Svamaan vs. Sammaan – Delhi HC Rules on Brand Protection

Citation: Svamaan Financial Services Private Limited vs. Sammaan Capital Limited & Ors., CS(COMM) 871/2024, Delhi High Court

Judgment Date: February 10, 2025

Coram: Hon'ble Mr. Justice Amit Bansal

Headnote:

The Delhi High Court adjudicated a trademark infringement and passing off dispute between Svamaan Financial Services Pvt. Ltd. (Plaintiff) and Sammaan Capital Ltd. & Ors. (Defendants), both engaged in financial services. The court held that ‘Sammaan’ was deceptively similar to ‘Svamaan’, creating a likelihood of confusion, and restrained the defendants from using the impugned mark.

Background:

- Plaintiff, incorporated in 2017, operates as an NBFC-MFI (Micro Finance Institution) providing loans and financial services under the ‘SVAMAAN’ brand.

- Plaintiff has registered trademarks in Class 36 (Financial Services) and other allied classes, claiming use since 2017.

- Defendant No. 1 (previously Indiabulls Housing Finance Ltd.) rebranded as ‘Sammaan Capital Ltd.’ in 2024, along with related companies adopting the ‘SAMMAAN’ name.

- Plaintiff issued a cease-and-desist notice in November 2023, opposed the defendants' trademark applications, and filed objections with the Registrar of Companies (RoC) and RBI, but defendants proceeded with rebranding.

- Plaintiff alleged trademark infringement, passing off, and sought an injunction against defendants' use of ‘SAMMAAN’.

Key Issues:

1. Prior Use & Trademark Rights: Whether the plaintiff’s earlier adoption and registration of ‘SVAMAAN’ grants it exclusive rights over the mark.

2. Similarity & Likelihood of Confusion: Whether ‘SAMMAAN’ is deceptively similar to ‘SVAMAAN’, leading to consumer confusion.

3. Bonafide Adoption: Whether the defendants adopted the mark in good faith or with knowledge of the plaintiff’s brand.

4. Balance of Convenience & Irreparable Harm: Whether allowing defendants to use ‘SAMMAAN’ would cause harm to the plaintiff’s goodwill.

Court’s Observations:

1. Prior Use & Trademark Rights:

- The plaintiff had been using ‘SVAMAAN’ since 2017, well before the defendants’ adoption of ‘SAMMAAN’ in 2024.

- Plaintiff’s registered trademarks provided statutory protection under Section 28 of the Trade Marks Act, 1999.

2. Similarity & Likelihood of Confusion:

- The words ‘SVAMAAN’ and ‘SAMMAAN’ were found to be phonetically, visually, and conceptually similar, differing only by one letter.

- Since both marks were used in financial services, the likelihood of confusion among consumers was high, as per Section 29(2)(b) of the Trade Marks Act, 1999.

- The test of initial interest confusion applied: consumers encountering ‘SAMMAAN’ might associate it with the plaintiff’s ‘SVAMAAN’ brand.

3. Bonafide Adoption:

- Defendants failed to justify why they adopted ‘SAMMAAN’ despite prior notice from the plaintiff.

- The defendants' prior brand ‘INDIABULLS’ had no connection with ‘SAMMAAN’, indicating a deliberate shift to a similar-sounding name.

- The adoption was not bona fide, particularly as the plaintiff had already raised objections before regulatory authorities.

4. Balance of Convenience & Irreparable Harm:

- Plaintiff had substantial goodwill and reputation in the financial sector, and confusion could mislead consumers.

- Regulatory approvals (RBI, RoC) granted to defendants did not override trademark rights, as the jurisdiction for trademark disputes lay with civil courts.

- The court rejected the defendants' argument of delay and acquiescence, citing that the plaintiff had actively opposed the defendants' actions.

Judgment:

- The court granted an interim injunction restraining the defendants from using ‘SAMMAAN’ or any deceptively similar mark in their business operations.

- Defendants were directed to refrain from using the mark in advertisements, websites, and corporate branding.

- The case was scheduled for further proceedings on the permanent injunction and damages claim.

Significance:

- Affirms strong trademark protection for prior registered users in financial services.

- Expands the scope of deceptive similarity beyond identical marks, reinforcing the initial interest confusion doctrine.

- Clarifies the role of regulatory approvals, holding that corporate name approvals do not override trademark rights.

Conclusion: The ruling underscores the importance of prior use and trademark registration in brand protection, reinforcing that deceptively similar marks, even if subtly different, can be injuncted to prevent consumer confusion.