Doctrine of honest concurrent use of Trademark

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION NO.310 OF 2012
IN

SUIT NO. 284 OF 2012

1. ITM Trust
A Trust registered under the Bombay Public Trusts Act, 1950
Having its principal place of business at Bunglow No. 12, Gulab View,
Chembur, Bombay 400 074.

2. Mr. Putcha Venkata Ramana,
Indian Inhabitant, aged 71 years having
office at, 601, Centre Point Building,
18th Road, Chembur (E), Mumbai 400071

3. Mrs. Putcha Lalitha Ramana,
Indian Inhabitant, aged 65 years having
office at, 601, Centre Point Building,
18th Road, Chembur (E), Mumbai 400071 … Plaintiffs

versus

Educate India Society,
a Society registered under the Societies Registration Act, 1860, having its Principal
Place of business at M/s. Huda Sector 23-A,
Gurgaon 122 017. … Defendants

A PPEARANCES

FOR THE PLAINTIFFS Mr. Aspi Chinoy, Senior Advocate a/w Ms.Chandana Salgaoncar, Aditya Thakkar i/b Vigil Juris.
FOR THE DEFENDANT Mr. Arvind Chaudhary, i/b Amol Deshpande.

CORAM : G.S.Patel, J.
JUDGMENT RESERVED ON : 16th July 2014
JUDGMENT PRONOUNCED ON
ig : 15th September 2014
JUDGMENT : (Per G.S. Patel, J.)

1. The Plaintiffs claim to have a trade mark, ITM, registered under Class 41 (educational services) since 2004. They allege infringement of and passing off in respect of this mark by the Defendant, and seek suitable injunctions. The suit is an action in trademark infringement combined with a cause of action in passing off. The petition under Cl. XIV of the Letters Patent for leave to combine the cause of action in passing off with the cause of action in infringement was contested. Leave was granted by a reasoned order and judgment of Mr. Justice Kathawalla on 22nd February 2012.

2. This is the present Notice of Motion’s second lease of life. It was earlier dismissed on 20th July 2012, on a finding that the contesting marks were dissimilar. The Defendant’s plea of honest and concurrent user was not considered. The matter was carried in appeal. The order of the learned single Judge was set aside by consent in the Appeal Court, and the matter remitted, but only for a consideration of the plea of honest and concurrent user. The question of deceptive similarity was concluded, both sides agreeing that the marks in question were identical. This was by an order dated 8th May 2013. Paragraphs 5 and 6(iii) of the appeal court order read:

5. The learned Single Judge has not dealt with the defence of honest and concurrent user that has been set up by the Respondent. The Respondent has also filed a written statement raising that defence. The written statement was filed after the impugned order was passed. In this background, both the learned counsel state that the impugned order of the learned Single Judge may be quashed and set aside and the proceedings may be remitted back for considering the defence of honest and concurrent user that has been set up by the Respondent. However, it is agreed that since the marks ‘ITM’ of the Appellants and of the Respondent are identical, the impugned finding of the Single Judge would have to be set aside. Other aspects of the defence can be kept open.
(iii) The learned Single Judge shall consider the Notice of Motion afresh. It is, however, clarified that the finding on which the learned Single Judge has dismissed the Notice of Motion namely that there is a dissimilarity between the marks of the Appellants and of the Respondent is set aside and shall stand concluded in view of the admitted position that the essential features of both the marks are the letters ‘ITM’ ;
(emphasis supplied)
3. With this, the controversy is now narrowed. There is a single defence to consider, that of honest and concurrent user. The question of testing the rival marks for deceptive similarity no longer survives: that stands concluded by consent and, in any event, by the order of the Division Bench in appeal.
4. I have heard Mr. Chinoy, learned Senior Counsel for the Plaintiffs, and Mr. Chaudhary, learned Counsel for the Defendant, at some length. I have considered carefully their respective submissions and the considerable material on record. I am not persuaded that the Defendants have been able to establish a case of honest and concurrent user. What they claim is use of the mark is nothing but use as a common abbreviation; there is no use of the mark as a mark per se. I have therefore granted the injunctions sought.
5. The prayers in the Notice of Motion are wider: the Plaintiffs also seek to restrain the Defendants from using the words “Institute of Technology & Management”. Mr. Chinoy readily accepts that this is not in issue and the Defendants can continue to use this mark.
He restricts himself to the Defendant’s use of the mark “ITM” either by itself or in conjunction with any other word, including the word “University” (i.e., as “ITM University”).

6. Now that the question of similarity does not arise, I will take the Plaintiffs’ claims to user as broadly accepted, since the only matter for decision is the Defendants case’ of honest and concurrent user. The following abbreviated factual background to the Plaintiffs’ use of the mark in question should suffice:

(a) The 1st Plaintiff is a public charitable and educational trust registered under the Bombay Public Trusts Act, 1950. Plaintiffs Nos. 2 and 3 are its trustees. Till 1991, the Plaintiffs trade mark was “INSTITUTE FOR TECHNOLOGY & MANAGEMENT” in a curved or spherical form surrounding a circular device embedded with another device of a shield at its centre. The shield itself had four quadrants, each with a graphic. In a ribbon device at the base were the words “SUMMA OPTIMAQUE”, and below that the year 1991. From 1993, the Plaintiffs’ trade mark was different. The words “INSTITUTE FOR TECHNOLOGY & MANAGEMENT” remained in the curved form, but in the centre the shield was replaced with the expression “ITM”. The lower ribbon’s slogan was different, too: it now read “INFORMATION IS LIFE”. The year 1991 remained. Below the entirety of this were the words ITM TRUST between two horizontal lines. The term “ITM” at the centre was depicted in a stylized graphical manner, less font than design. The Plaintiffs claim to be rendering services from 1993 under this trade mark, ITM.
(b) Since 1991, the Plaintiffs have run a technology and management educational institution. In February 1991, the Plaintiffs entered into an association with the Southern New Hampshire College (formerly the New Hampshire College), Manchester, New Hampshire, USA. This is a well known business management institute, said to be among the top ten in the United States. Its brochures and other printed material refer to its association with the Plaintiffs’ institute, and references their marks “ITM” and “ITM University”. On 8th July 1993, control and management of the Institute of Technology & Management was formalized by a Deed of Trust of that date. The Trust Deed specifically says that the name of the trust is “Institute for Technology and Management Trust” or “ITM Trust” or both.
(c) The Plaintiffs claim to have pioneered private unaided colleges, there being none such in 1991, and also educational courses combining technology and management. They also claim to have used their mark, ITM, continuously since 1991, and support this claim by relying on a considerable volume of material annexed to the plaint: booksellers’ invoices for sales to them, lecture schedules, attendance sheets, correspondence from the New Hampshire College, graduation certificates and so forth.
(d) By 1999, the Plaintiffs had four educational centres at Mumbai, Bangalore, Chennai and Warangal, all offering educational services under the mark “ITM”. The courses offered included Post Graduate Diploma in Business Administration (“PGDBA”) (MBA) course. From 1997 onwards, the Plaintiffs have used the domain name www.itm.edu with a fully functional website under it.
(e) In 2000, the Plaintiffs got the word mark “ITM” registered in Class 16 (stationery, printed matter, publications, etc.) showing use from 1993. On 26th July 2004, the Plaintiffs got the trade mark “ITM” set in a circle, i.e., the word mark ITM plus the logo, registered in Class 41, for educational services, showing use from 1993. This mark and logo were also registered in Class 16 with effect from April 2000 (showing use from 1993). Additional registrations were obtained in classes 9, 28, 35, 36 and 38. In June 2010, the Plaintiffs applied for registration of the mark “ITM-University” in Class 41, contending that this has been in continuous and uninterrupted use since 2002.
(f) The Plaintiffs also established the ITM University at Raipur. The 2nd Plaintiff was appointed Chancellor of this university in 2003. The university itself was set up in 2004. Though the 2002 statute under which it was granted recognition as a private university was struck down by the Supreme Court in in Prof. Yashpal & Anr. v State of Chhattisgarh & Ors.,1 renewed recognition of ITM University as a private university followed under a new statute of 2005-2006.
(g) There are further credentials: an application for a deemed university in KhargHar in 2008; accreditation by the National Assessment & Accreditation Council in the same year; an institute called ITM Coastal Institute of Technology & Management in Vijaynagar in 2009; other institutes in Hyderabad and Nagpur in 2010, followed by yet another in Thane in association with the South India Association and called the SIA-ITM Business School. From 2011, the Plaintiffs also have a certification of MBA equivalence from the Association of Indian Universities. About 20,000 students are said to have graduated the Plaintiffs’ courses since 1991, and between 1993 and 2010 students have obtained placements as well. The Plaintiffs’ institutes have been written up in various business magazines at different times between 1999 and 2011, and the Plaintiffs have also widely advertised their courses at a cost of over Rs.50 crores in the nearly two decades between 1992 and 2011. The 1st Plaintiff has a corpus of Rs.50 crores, and physical assets of Rs.250 crores. Material in support of all these assertions is annexed to the plaint.

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7. The Plaintiffs claim that it was not till 18th March 2010 that they learned of the Defendants’ rival institute. A student seeking admission to the Plaintiffs’ Institute for Technology & Management informed their admissions centre in Delhi that there was a recent blog that referred to the closure of “ITM Gurgaon” and alleged misappropriation at that institute. This institute was in no way connected with the Plaintiffs, who had no establishment in Gurgaon.

This incident is of some consequence to Mr. Chinoy’s case, for he submits that in and of itself, this shows that confusion and deception are not any longer in the realm of mere possibility; they have actually occurred; and if that be so, there can be no question of ‘honest’ user. I will return to this argument presently.

8. On 31st March 2010, the Plaintiffs, through their advocates, sent a notice to the Defendant about their use of the mark claimed by the Plaintiffs, and also sought the intervention of various authorities to prevent the Defendants from, as the Plaintiffs claimed, further damaging the Plaintiffs’ goodwill, image and reputation.

9. The next day, 1st April 2010, the Defendants applied for registration of the mark “ITM University” in class 41, saying it was proposed to be used. This, according to the Plaintiffs, is the offending mark, at Exhibit “KK” the plaint, at page 488. It has the word “itm” in lower case set above the word “UNIVERSITY” in capital letters, and, above these is a circular device with a stylized graphic of a bird taking flight and which might also be seen as a lamp with a flame.

10. On 13th April 2010, the Defendants, through their advocates, responded to the Plaintiffs’ attorneys’ notice of 31st March 2010. The Defendants claimed to have been using the name “Institute for Technology and Management” since 1996, and also claimed, and this is important for several reasons, that ITM was an abbreviation over which the Plaintiffs could assert no exclusivity. The Plaintiffs’ attorneys’ responded on 21st April 2010 with another cease-and-desist notice.

11. On 22nd June 2010, the Plaintiffs applied for registration of the trade mark “ITM University” in class 16 and class 41.

12. On 22nd July 2011, the Defendants’ advocates replied saying that the Defendants had adopted the trade mark “Institute of Technology and Management” in 1999, in combination with a device of a shield and in respect of educational services. They also said that the Defendants were the registered proprietors of the trade mark with the alphabets ITM in class 16 in respect of stationery and printed matter. The Defendants alleged that it was the Plaintiffs who had adopted the Defendants’ mark.

13. The Plaintiffs’ advocates replied on 17th August 2011 denying these allegations. This suit was filed on 4th January 2012 and a Notice of Motion filed for interim reliefs. On 4th February 2012, the Defendants filed an affidavit in reply claiming honest and concurrent user of the mark “ITM” since 1999. On 20th July 2012, the Plaintiffs’ Notice of Motion was dismissed on the ground that there was no similarity between the rival marks. There then followed the appellate order of 8th May 2013 to which I have earlier referred. Following this, further affidavits have been filed.

14. The Defendants claims to trade mark registration are that:

(a) In 1996, they obtained registration of a mark with a shield device inset with a cross set in a chequered background, with a lamp at the cross’s centre, and the words “INSTITUTE OF TECHNLOGY & MANAGEMENT” beside the device. The word “ITM” does not appear on this trade mark.
(b) In 2007, they obtained registration of a trademark in class 16. This was a device of a shield with a cross embedded on a chequered background, a scroll beneath the shield device, the words “INSTITUE OF TECHNOLOGY AND MANAGEMENT” beside it and, above the shield, the letters “ITM”. The application appears to have been made on 7th March 2002. There is no evidence of this mark having been used.
(c) On 1st April 2010, as I have noted, the Defendants applied for registration of the mark “ITM University” with the logo in class 41, saying that the user was ‘proposed’.

15. The Defendants’ case in paragraph 3 of the affidavit in reply is, specifically, of the use of “Institute of Technology and Management” since 1996 and, importantly for the purposes of this Notice of Motion, of the “mark ‘ITM’ since the year 1999”. In paragraph 4, the Defendants make the claim of honest and concurrent user. These claims are repeated a few pages later.

16. Mr. Chinoy’s submission is that the only registration that the Defendants have is in class 16 and even that can, at best, be traced back to 2002, though granted in 2004. In April 2010, the Defendants merely applied for registration. There is, he submits, no material to show prior user of the mark “ITM”. The Plaintiffs, in contrast, have a class 41 registration (in respect of educational services) of 2007, with effect from 2004, but with demonstrable use since 1993.

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17. Pursuant to the Appeal Court order, the Defendants filed an additional affidavit dated 21st May 2013. There is, in the first few pages of this affidavit, an attempt to establish user: AICTE approvals, affiliations, accreditations and so on. None of these are in respect of the mark ITM as a mark and going back to 1999. What is of particular interest is the averment made in respect of this mark, ITM (the only one with which I am concerned), in paragraphs 13 and 14, where the Defendants say:

“13. I state that the defendant’s honesty of adoption of the mark ITM is proved from the factum that the Trade Mark “ITM” is an acronym derived from the first three alphabets of the abbreviated format of its earlier name, “Institute of Technology and Management” when the Defendant was running an affiliated college created in 1995-96, duly approved by the statutory bodies such as the All India Council for Technical Education (AICTE), State Government and the affiliated University. The said acronym, “ITM” has been derived from the first alphabet of each of the words of “Institute of Technology and Management”, which is a common practice with respect to educational institutes across the country and is not oly peculiar to the defendant for example Indian Institute of Technology is called IIT and Indian Institute of Management is called IIM. Further, the name “Institute of Technology and Management” was coined by the defendant as it was describing the courses of study conducted by the defendant’s institute as it has been providing Engineering and Management courses at its Institute, when it was an affiliate college. Later on, when the defendant became the first University with the name “ITM University”, it started awarding degrees in Engineering, Management, Law and Humanities which are also duly recognized and approved by the statutory bodies such as the UGC, Bar Council of India, Directorate of Technical Education, Haryana and AICTE. Thus, the defendant is the prior authorised user of the Trade Mark “ITM University” .
14. I state that Section 12 of the Trade Marks Act, 1999 and Section 12(3) of the Trade & Merchandise Marks Act, 1958 under which both the plaintiff and the defendant got registration provides for registration of two similar marks by honest and concurrent users/proprietors of mark who could have thought of two similar/identical marks being totally unaware of the other’s users or trying to take advantage of others goodwill.”
18. What is it that the Defendants say in these paragraphs? First, it is clear that they have no registration of the word “ITM” as a mark. Their avowed use of the term is as an acronym, and not as a mark, properly so called. The plea taken is of honest and concurrent user. Of the documents annexed to this affidavit and to which Mr. Chaudhary referred, the only one is at page 305, a notification of the Maharshi Dayanand University, Rohtak that refers to the Defendants as the ‘Institute of Technology and Management, Gurgaon (ITM)’ and confers autonomy. The only use, therefore, appears to be as an acronym, and that too by the Government in referring to the Defendants, not use in the context of a trade mark. Mr. Chaudhary drew attention to a letter of 13th October 2010 from the University of Warwick. This, too, refers to the Defendants as ITM University; but again, this seems prima facie to be use as an acronym not as a trade mark, and is also by another party. That the use is as an abbreviation or an acronym is evident from the next document to which Mr. Chaudhary refers, a Memorandum of Understanding between “ITM University”, further shortened to “ITMU” and the Institute of Technology Blanchardstown, described as “ITB”. There is, finally, a brochure at page 410, and said to be of 2001. The cover page does not use the word “ITM” at all, but the full form of the Defendants’ institute and the shield device. Scattered through the body of this brochure are repeated uses of “ITM”, but clearly this is used as an abbreviation and nothing else. At page 432 there is the shield device with “ITM” above it, but that again does not seem to be use as a trade mark. This is, I think, clear from some of the subsequent pages where the Defendants have used their trade mark; and what they have used is the shield device with the words “Institute of Technology and Management” (pages 434 and 436, for instance). These are indeed uses of the Defendants’ trade mark, but that mark does not include the word “ITM”. The next 186 pages of annexures to this affidavit is a full set of the Defendants’ mandatory disclosures made to various authorities at different times. There is nothing in this morass of material to show the use of the word “ITM” as anything other than an acronym; certainly there is no use of it as a trade mark.

19. Now the averment of “ITM” being an acronym, and of it being used as an acronym or abbreviation, is one that, as Mr. Chinoy correctly said, ousts any plea of honest and concurrent user of the word as a trade mark. In the very considerable material placed by the Defendants, there is no evidence such use, i.e., of the expression “ITM” as a trade mark. Its only use seems to be as an acronym.

There is certainly no material to evidence use of any kind since 1999. In addition, it is not in dispute that the Defendants themselves applied for registration of ITM as a mark (since “University” cannot possibly be registered) only on 1st April 2010. On that application, the Defendants were informed of the Plaintiffs’ prior registration. Consequently, two results must follow: there is no material to show use from 1999 as claimed, and any use after April 2010 is not ‘honest’ since the Defendants were made aware of the Plaintiffs’ prior mark existing on the Register of Trade Marks. Equally important is the fact that in the application of 1st April 2010, the Defendants said that the mark of which they sought registration, “ITM University”, was proposed to be used.

20. Mr. Chaudhary then submitted that the documents annexed to the further rejoinder establish his clients’ case. Specifically, the information brochure, Exhibit “Z-2”, and pages 685 to 687 that contain a long list of participating colleges and institutes. To the right of the name of each college is the abbreviation by which it is referred in that document; and the column heading specifically says that these are abbreviations. How this assists Mr. Chaudhary in establishing the Defendants’ claimed use of the mark “ITM” since 1996 is unclear.

21. In any case, I do not see how the Defendants’ only prior registration, that of 2007 in class 16 (for stationery, etc.), can possibly be an answer to the Plaintiffs’ prior registration of 2004 in class 41 (for educational institutions). The only earlier registration the Defendants had was of 1996, and it did not use the term “ITM” at all.

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22. I understood Mr. Chaudhary to submit that the Plaintiffs do not have any university at all, and to reiterate that the word “ITM” is used by the Defendants merely an abbreviation followed by a description of the Defendants’ status as a university. Whether or not the Plaintiffs’ or any of their institutes are a university and the validity of that recognition are all matters beyond the scope of this Notice of Motion. I believe Mr. Chaudhary’s formulation to be faulty, and self-defeating. If, as he says, the term “ITM” is only used as an abbreviation, then there can be no claim of “honest and concurrent user”, for the latter claim only arises in the context of use of a term or expression as a trade mark. Are the Defendants using “ITM” as a trade mark or are they not? On the one hand they say it is a mere acronym or an abbreviation. At the same time, they have sought registration of that very term, and have even filed suits in the Delhi High Court claiming to be proprietors of this term “as a mark”. Both submissions cannot co-exist. Given that there is no material to show any use, let alone any honest or concurrent use, since 1999.

23. Mr. Chaudhary then referred to Exhibit D-14 to the written statement filed by the Defendants. This is a brochure of 1999-2000 issued by the Defendants. The cover page shows the shield device with the expression “ITM” above it. I do not think this is evidence of use of “ITM” as a mark sufficient to support the Defendants’ pleadings and establish a case of honest and concurrent user. The use of “ITM” here, too, seems to be as an abbreviation. This is apparent, and with some startling vividity, from page 861, a pro- forma diploma in Economics from the Defendants’ institute with a mention at the foot of the University of London, Lead College, and the London School of Economics. This pro-forma uses the Defendants trade mark, viz., the one with the shield device and the full name, “Institute of Technology and Management”. The term “ITM” does not appear on this pro-forma diploma at all. I would expect that a document like this, one of some formality, and likely to be preserved for a very long time, would as a matter of course show “ITM” as the Defendants’ trade mark if they indeed had it or used it. The expression is altogether absent, and this only substantiates Mr. Chinoy’s case that there is no material to show that the Defendants’ have ever appropriated this expression to themselves as a trade mark.

24. I believe Mr. Chaudhary’s reliance on the Supreme Court decision in Skyline Education Institute (India) Pvt Ltd v S. L. Vaswani & Anr.2 to be misplaced. There, the trial court restrained the defendant from starting any new courses similar to those of the plaintiff, and did so in a trade mark infringement action. The Division Bench reversed in appeal, and the Supreme Court upheld (2010) 2 SCC 142 the order of the Division Bench. I do not see how that decision has any application to the case at hand. Mr. Chinoy does not seek to restrain the Defendants from going about their business. Indeed, he makes it clear that he does not even seek to interfere with the use of their name, “Institute of Technology and Management”. He restricts himself to the Defendants’ attempted use of the Plaintiffs’ trade mark “ITM” either by itself or in conjunction with any other word, i.e., the use of this mark as a mark.

25. Mr. Chaudhary’s reliance on the decision of a learned single Judge of this Court in Hindustan Unilever Ltd v Ashique Chemcials & Ors.3 is equally inapposite. There, Mr. Justice Vazifdar found that a registered mark had not been used even once for 60 years, not even by an assignee or a licensee. To claim a monopoly in that situation, Mr. Justice Vazifdar held, was entirely incorrect and impermissible. The case at hand can hardly be said to be on the same footing, given the Plaintiffs’ demonstrated extensive use of their mark, as a mark, coupled with their prior registration.

26. I cannot possibly go into the question of whether the Plaintiffs’ mark was validly registered. It has long been the view of this court,4 including a Division Bench,5 a view only latterly doubted,6 that it is not the practice of this court to consider the (2011) 6 Bom C.R. 854 : (2011) 5 Mh L.J. 836 Hindustan Embroidery Mills Pvt. Ltd. v K. Ravindra and Co., (1974) 74 Bom L. R. 146;

Maxheal Pharmaceuticals (India) v Shalina Laboratories Pvt. Ltd., Appeal No. 88 of 2005 in Notice of Motion No.2638 of 2004 in Suit No. 2663 of 2004; judgment dated 16th February 2005.

Lupin Ltd v Johnson & Johnson, 2013 (53) PTC 90 (Bom).

validity of registration of a trade mark on a motion for interlocutory reliefs filed by the registrant of a mark. While the mark remains on the register, even wrongly, it is not, our court has said, desirable that others imitate it. That issue is, I believe, referred to a Full Bench, whose decision is yet awaited. Till then, I am bound by the view of the Division Bench in Maxheal Pharmaceuticals.7 In any case, given the limited scope of this Notice of Motion following the order of the Division Bench in appeal, I do not see how I can possibly examine this question at all. The Division Bench’s order is clear: the only issue for determination is the Defendants’ plea of honest and concurrent user. No question of testing the validity of the Plaintiffs’ registration can possibly arise.

27. Mr. Chinoy is also correct in saying that once a defendant has itself sought registration of a mark, it can hardly be heard to say that the mark is not distinctive, and therefore ought not to have been registered to the plaintiff in the first place. The law on that issue is now far too well-settled to merit repetition.8

28. The Defendants having failed to show any user at all since 1999, let alone any honest or concurrent user of the mark “ITM” as a trade mark, the motion succeeds. Pending the hearing and final disposal of the suit, the Defendants, by themselves, their agents and employees are restrained from using the mark “ITM” or any other Supra.

Automatic Electric Limited v R.K. Dhavan & Anr., 1999 PTC (19) 81; Indian Hotels Company Ltd. & Anr. v Jiva Institute of Vedic Science and Culture, 2008 (37) PTC 468 (Del.) (DB); Ultra Tech Cement Limited v Alaknanda Cement Pvt. Ltd. & Anr., 2011 (5) Bom CR 588; Corn Products Refining Co. v Shangrila Food Products Ltd., AIR 1960 SC 142.

deceptively similar mark in respect of technical and educational services so as to infringe the Plaintiffs’ registered trade mark “ITM” or pass off (or enable others to pass off ) the Defendants’ services as those of the Plaintiffs.

29. Notice of Motion is disposed of in these terms, with no order as to costs.

30. At the request of the learned advocate for the Defendants, operation of this order is stayed for a period of six weeks from today.

The only reason for granting the stay is that there is no ad-interim order and the motion is itself of the year 2012.

(G.S. PATEL, J.)

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