Delhi High Court Grants Injunction in Trademark Infringement Case: “SVAMAAN” vs. “SAMMAAN” – Use of “SAMMAAN” Found to Infringe Trademark “SVAMAAN” Due to Strong Likelihood of Consumer Confusion

Court’s Decision

The Delhi High Court ruled in favor of the plaintiff, holding that the defendants’ use of the mark “SAMMAAN” in their corporate names and branding amounted to trademark infringement and passing off. The Court found that the plaintiff was the prior adopter, user, and registered proprietor of the mark “SVAMAAN” in the financial services sector.

It determined that “SVAMAAN” and “SAMMAAN” were deceptively similar, both phonetically and visually, creating a high likelihood of confusion among consumers. The Court issued an injunction restraining the defendants from using “SAMMAAN” in their corporate identity and branding.

Facts of the Case

Plaintiff’s Business and Trademark Usage

1. The plaintiff, a Non-Banking Finance Company (NBFC), was incorporated in 2017 and provides microfinance loans for small businesses, housing, and personal emergencies.
2. It holds multiple registered trademarks for “SVAMAAN” in Class 36 (financial services), among others.
3. The plaintiff’s financial services are well-recognized, with over 2,48,163 borrowers and a loan book worth INR 968 crores.
4. The plaintiff operates under the domain www.svamaan.in and has a strong presence on digital and social media platforms.

Defendants’ Adoption of “SAMMAAN”

1. The defendants were previously part of the Indiabulls Group and operated under the “INDIABULLS” brand for over two decades.
2. In 2024, they decided to change their corporate names, replacing “INDIABULLS” with “SAMMAAN.”
3. Defendant No.1 (Sammaan Capital Limited) focuses on housing loans and mortgage-backed finance, similar to the plaintiff’s microfinance services.
4. The defendants applied for trademark registrations for the “SAMMAAN” name between February 2024 and May 2024, after receiving a cease-and-desist notice from the plaintiff in November 2023.
5. Despite objections, the defendants received regulatory approvals from the Ministry of Corporate Affairs (MCA) and the Reserve Bank of India (RBI) in mid-2024.

Legal Issues Before the Court

1. Is the mark “SAMMAAN” identical or deceptively similar to “SVAMAAN”?
2. Would the use of “SAMMAAN” create confusion among consumers?
3. Are the plaintiff and defendants engaged in identical or similar financial services?
4. Did the defendants adopt “SAMMAAN” in good faith?
5. Does the plaintiff’s delay in filing the suit weaken its case?

Petitioner’s Arguments (Plaintiff’s Contentions)

1. Prior User and Registered Owner of “SVAMAAN”
   • The plaintiff adopted “SVAMAAN” in 2017 and has used it in financial services since 2019.
   • The plaintiff holds multiple trademark registrations for “SVAMAAN” in financial and banking services.
   • The defendants only adopted “SAMMAAN” in 2024, much later than the plaintiff.
2. Similarity Between the Two Marks
   • “SAMMAAN” is phonetically, visually, and conceptually similar to “SVAMAAN.”
   • The only difference is the letter “V” replaced with “M”, which is insufficient to distinguish the marks.
   • Courts must compare the dominant portions of the marks, not just additional words like “Capital” or “Finance.”
3. Likelihood of Confusion
   • Both the plaintiff and the defendants operate in the financial services sector, leading to an overlap of customers.
   • Consumers who are illiterate, semi-literate, or non-Hindi speaking will likely be confused between the two marks.
   • Under Section 29 of the Trade Marks Act, 1999, confusion is presumed when similar marks are used for identical services.
4. Defendants Acted in Bad Faith
   • The defendants had full knowledge of the plaintiff’s mark but still proceeded with adopting “SAMMAAN.”
   • A cease-and-desist notice was sent to the defendants in November 2023, but they ignored it.
   • The defendants rushed to register “SAMMAAN” as a trademark after receiving legal objections from the plaintiff.
5. Regulatory Approvals Do Not Override Trademark Law
   • Just because the defendants received RBI and MCA approvals does not mean they have the legal right to use “SAMMAAN.”
   • Trademark rights are determined by the courts, not regulatory bodies.
6. No Delay in Filing Suit
   • The plaintiff took immediate action in November 2023 by sending a legal notice.
   • The plaintiff filed objections with MCA and RBI before filing the suit in October 2024.

Respondent’s Arguments (Defendants’ Contentions)

1. Marks Are Different
   • The defendants argued that “SVAMAAN” and “SAMMAAN” are not identical.
   • The visual presentation of the marks, including logos and typography, is different.
2. Defendants’ Consumers Are Knowledgeable
   • The defendants cater to high-value loan customers, who are educated and financially literate.
   • Such consumers are less likely to be confused between “SVAMAAN” and “SAMMAAN.”
3. Regulatory Approvals Justify Use
   • The defendants received RBI and MCA approvals, suggesting their corporate name is legally permissible.
4. Plaintiff’s Mark Is Descriptive
   • The defendants argued that “SVAMAAN” is a common Hindi word meaning “self-respect” and should not be monopolized.

Court’s Legal Analysis

1. Are the Marks Identical or Similar?

The Court relied on precedents, including:

• Ruston & Hornsby v. Zamindara Engineering – A minor spelling change does not prevent confusion.
• Corn Products Refining v. Shangrila Food Products – Phonetic and conceptual similarity is enough to prove infringement.
• Shree Nath Heritage Liquor v. Allied Blender – Two marks with a similar meaning can cause confusion.

The Court ruled that “SVAMAAN” and “SAMMAAN” are deceptively similar, leading to consumer confusion.

2. Are the Services Similar?

• The Court noted that both parties operate in financial services and lend money to consumers.
• Even if their loan structures differ, there is a trade connection, leading to confusion in the market.

3. Bad Faith in Adoption of “SAMMAAN”

• The defendants had prior knowledge of “SVAMAAN” before adopting “SAMMAAN.”
• The timing of their trademark applications, after receiving legal objections, suggests dishonest adoption.

4. Regulatory Approvals Do Not Matter in Trademark Law

• The Court emphasized that MCA and RBI approvals do not grant immunity from trademark infringement.
• The Court has the final authority to determine whether the mark violates trademark rights.

Conclusion

The Court ruled in favor of the plaintiff and issued a permanent injunction, barring the defendants from:

1. Using “SAMMAAN” in branding, advertisements, or corporate names.
2. Promoting their financial services under the “SAMMAAN” name.

Implications

• Trademark owners with prior registrations have strong legal protections.
• Regulatory approvals do not override intellectual property rights.
• Companies must conduct thorough trademark searches before rebranding.

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