R. Bhaskaran, J.

1. By the judgment dated 20.2.2004 this Court had partly modified the order passed by the trial Court by deleting the condition for deposit of Rs.75,000/- for the grant of Injunction in favour of the appellant. One of the reasons stated in the judgment was that there was no cross objection filed by the respondent against the grant of injunction by the trial court. Since it was an omission to take note of the filing of cross objection, the judgment was reviewed and the counsel were heard again.

2. This appeal is filed against the order passed by the District Court, Ernakulam in I.A.804/2003 in O.S.23/2003. The appellant herein was the plaintiff in the suit. The prayer in the suit was for perpetual prohibitory injunction restraining the defendant and his agents from using the domain name PEN BOOKS.com or any name or trade mark similar to PEN BOOKS as a domain name, trade name or trade mark or offering for sale such domain name, trade name or trade mark and from doing any other thing which is likely to lead to passing off of the business of the defendant as those of the plaintiff. There was also a prayer for mandatory injunction directing the defendant to transfer the domain name PENBOOKS.com to the plaintiff or to file a voluntary request to cancel the domain name PENBOOKS.com to the Domain Registry where it has been registered so as to enable the plaintiff to register it in its name.

3. In the application for interim injunction the trial Court passed an order of injunction on condition that the petitioner deposits Rs.75,000 within two weeks from the date of the order. According to the petitioner the direction to deposit of Rs.75,000 as a condition for grant of interim injunction is illegal. The respondent has filed a cross objection contending that since there is no passing off as contemplated in the Trade and Merchandise Marks Act, 1958 the suit is not maintainable. It was also contended that the right of the appellant has been voluntarily and consciously abandoned. It is contended in the cross objection that the application for interim injunction should have been dismissed. It is also contended that since the plaintiff has not prima facie proved any passing off, petitioners application ought to have been dismissed in limine. It is pointed out that the plaintiff did not renew the website already registered in their name and has voluntarily and consciously abandoned the rights. Petitioner has no right to file application for injunction.

4. The plaintiff is a private limited company under the Indian Companies Act. According to the plaintiff, by virtue of long and continuous use of the mark PEN BOOKS the plaintiff acquired a proprietary right over the mark and also has a pending trade mark application to protect the mark PEN BOOKS from 1997 onwards. The case of the plaintiff is that the plaintiff is one of the largest business establishments in printing and publishing industry operating in the State of Kerala. The plaintiff promoted the mark by effective advertisement. The advertisement expenditure for the plaintiff for the year 2001-2002 is said to be to the tune of Rs. 1,00,34,278/-. In the suit as well as in the appeal, the dispute is with regard to the registration of domain name penbooks.com. Domain name is used to identify a persons internet address. It is used by commercial organisations to promote their products. It enables them to have an e-mail address and a website address. It serves the same function as trademark and is entitled to equal protection as a trademark. The registration of domain names was initially by the Inter Network Information Centre (Inter NIC) in United States. At present it is the Network Solutions Inc. (NSI) acting on behalf of the InterNIC. It is divided geographically. The system of assigning the domain name is on firstcome-first-registered basis. Obtaining fraudulent registration with an intent to sell the domain name to the lawful owner of the name at premium is called "cyber squatting". The Cyber squatters quickly sell the domain names to other non-related entities enabling passing off.

5. The appellant had registered the name PENBOOKS.com in the year 1999 and attempted to launch a website. But due to technical snags the website could not be operated smoothly. The period of registration of the domain name for the appellant has ended on 2.3.2001. The appellant wanted to redesign and launch the website again in 2002. At that time it was noticed by the appellant that the domain name PENBOOKS .com was registered in the name of the respondent and that it is advertised in the internet for sale. The appellant under the pretext of a prospective purchaser approached the respondent and the respondent offered the name for a price of Rs.50,000/-. Thereafter the appellant sent a lawyer notice informing the respondent that he has no right to register a domain name PENBOOKS.com as it is the property of the appellant and demanded transfer of domain name to the plaintiff or to cancel the registration. The appellant received a reply stating that the respondents employer has a claim of Rs.13,600/- as balance amount payable for developing the website. In addition to the above amount, the respondent also claimed Rs. 10,000/- towards expenses for maintain ing the registration and a premium of Rs.50,000/-. Since the demand was illegal, the plaintiff filed the present suit for injunction and for other reliefs. The appellant filed the application for interim injunction.

6. The respondent filed objections stating that the respondent is doing business of web designing and other computer operations. The petitioner applied to the defendant for designing the name WWW.penbooks.com. On the request of the petitioner the respondent designed the domain name WWW.penbook.com with 17 pages and the same was registered in the domain registry in the name of the Managing Director of the plaintiff-company. The petitioner did not pay the entire charges due to the respondent. The case of the respondent is that the domain name belongs to the respondent as the respondent has registered the same with the registrant. The plaintiff can use the domain name only during the period of registration and unless it is renewed it could be used by any other person. The respondent is not selling goods as that of the goods of the petitioner. As there is abandonment of domain name by not renewing the registration, the petitioner is not entitled to get cancellation of domain name registered by the respondent or to get it in their name.

7. The trial Court prima facie found that it is not just and proper to allow the respondent to sell the domain name to other persons. If it is so sold it will prejudicially affect the trademark of the petitioner. But the petitioner has to compensate the respondent for the loss sustained and, therefore, the trial court directed the plaintiff to deposit an amount of Rs.75,000/-.

8. According to the learned counsel for the appellant the direction to deposit

Rs.75,000/- is without any basis. The respondent has no case that he is a web designer of WWW.penbook.com. According to him he is one of the staffs of M/s. Ind-Us Graphics & Internet which is engaged in the field of web designing and the plaintiffs website with domain name consisting of 17 pages was designed by "Ind-Us Graphics & Internet". Learned counsel for the appellant submitted that the respondent cannot enforce the claim of Ind-Us Graphics & Internet in the present dispute. It is contended that though large amounts were paid to Ind-Us Graphics & Internet for designing website it was defective and the plaintiff had lost the amount already paid. Therefore, it is a dispute to be settled between the appellant and Ind-Us Graphics & Internet.

9. The main contention of the respondent is that the period of registration by the plaintiffs domain name penbooks.com was over and when the domain name was available with the registrant any person was free to apply and get it registered and there is no right available for the plaintiff to file a suit. The only argument of the plaintiff is with regard to the passing off and when the defendant has not started any publication in the name of penbooks.com there is no question of passing off and the suit itself is riot maintainable. It is therefore contended that the trial court should not have granted any injunction in favour of the plaintiff.

10. Since the suit is pending before the trial Court and it is not disposed of finally, the court is only concerned with the balance of convenience and prima facie case while disposing of the interim application for injunction, Therefore, nothing stated in the order of the trial Court or in this judgment should be treated as a final pronouncement with regard to the dispute between the parties. The learned counsel for the appellant Sri John Mathew and the learned counsel for the respondent Sri. P.A. Abdul Jabbar addressed elaborate arguments and it is only proper to advert to their arguments in brief while disposing of this appeal. The appellant has stated in para 9 of the plaint that the registration of PENBOOKS.COM in the name of the defendant is bound to create confusion in the minds of the users as they would take the website of the defendant as that of the plaintiff. Further the act of the defendant by registering and offering for sale of the domain name is a fraud on the public as the public relate the domain name PENBOOKS.com only to the plaintiff. Further such registration and advertisement for sale will tarnish the reputation of the plaintiff and dilute the invaluable trade mark rights of the plaintiff.

11. Abusive registration of domain name in violation of the rights of trade mark and service marks of others is popularly called "Cyber squatting". The learned counsel for the appellant relied on certain passages from "Trademarks & Cyber Property Rights" by V.K.Unni in para 69 of the book which reads as follows:

"The definition of abusive, registration (cybersquatting)-In popular terms, "Cybersquatting" is the term most frequently used to describe the deliberate, bad faith abusive registration of a domain name in violation of rights in trade marks and service marks. But, the term has different meanings to different people. Some people, for example, include "warehousing", or the practice of registering a collection of domain names corresponding to trade marks with the intention of selling the registrations to the owners of the trade marks, within the notion of Cybersquatting, while others distinguish between the two terms. Similarly, some consider "cyberpiracy" to be interchangeable with "cybersquatting", whereas WIPOs notion is that the former term relates to violation of copyright in the content of websites, rather than to abusive domain name registrations. Because of the flexible meaning of Cybersquatting in popular terminology, WIPO has preferred to use the term abusive registration of a domain name-in order to attribute to it a more precise meaning.

The definition of abusive registration is drafted in the following manner.

The registration of a domain name shall be considered to be abusive when all of the following conditions are met:

*the domain name is identical or misleadingly similar to a trade or service mark in which the complainant has rights; and

*the holder of the domain name has no rights or legitimate interests in respect of the domain name; and

*the domain name has been registered and is used in bad faith. A domain name shall be registered and used in bad faith:

* When there is an offer to sell, rent or otherwise transfer the domain name to the owner of the trade or service mark, or to a competitor of the owner of the trade or service mark, for valuable consideration; or

*When there is an attempt to attract, for financial gain, Internet users to the domain name holders website or other on-line location, by creating confusion with the trade or services mark of the complainant; or

*When the domain name has been registered in order to prevent the owner of the trade or service mark from reflecting the mark in a corresponding domain name, provided that a pattern of such conduct has been established on the part of the domain name holder; or

When the domain name is registered to disrupt the business of a competitor".

12. In Marks & Spencer v. One-in-a-Million (1998 FSR 265) it was held that any person who deliberately registers a domain name on account of its similarity to the name, brand name or trade markmust expect to find himself on the receiving end of an injunction to restrain the threat of passing off. This decision was followed by the Delhi High Court in Yahoo, Inc. v. AkashArora (1999 (19) PTC 201 [LQ/DelHC/1999/142] ) and in Mars Incorporated v. Kumar Krishna Mukerjee & Ors. (2003 (26) PTC 60 [LQ/DelHC/2002/2071] ). Mars Incorporateds case is an answer to the argument of the learned counsel for the respondent that the passing off is yet to take place and there is no present cause of action for the plaintiff. In the above- said decision it is stated as follows:

"15. Now the question arises whether incorporation of word MARS by the defendant company with the objective to launch food items and confectionary goods or adopting the word MARS in its Corporate name has rendered the defendant liable for Quia Timet Action or not.

16. Quia Timet is actually a Latin words which means "because he fears or apprehends". In legal terminology it has been defined in Osborne s Concise Law Dictionary (London: Sweet and Maxwell, 8th edn.1991, Bone and Rutherford) as an action by which a person may obtain an injunction to prevent or restrain some threatened act being done which, if done, would cause him substantial damage, and for which money would be no adequate sufficient remedy.

17. I am of the view that as in the case of infringement of registered trade mark or passing off action, the intention and object of infringer is mainly to trade or cash upon widespread and invaluable goodwill and reputation established over the years at huge cost by the plaintiff and in the process there occurs a dilution of the trade mark if goods manufactured and sold by infringer happen to be of poor quality, the underline intention of a person who proposes to adopt either same or deceptively or confusingly similar trade mark or even the Corporate name is to encash and become unjustly rich by trading upon the goodwill and reputation of the plaintiff."

13. It cannot now be disputed that absence of registration of a trade mark will not stand in the way of a claim for passing off. In Tata Sons Ltd. v. Manukosuri & Ors. (2001 PTC 432 (Delhi)) the Delhi High Court has held that domain names or internet sites are entitled to protection as a trade mark and that the Trade Mark Law applies to activities on internet. If that is so, the mere fact that petitioner has no registered domain name by itself may not stand in the way of in a passing off action. The Delhi High Court in Essel Packaging Ltd. v. SridharNarra & Ann (2002 (25) PTC 233 [LQ/DelHC/2002/947] ) has taken the same view.

14. It is also made clear in the Uniform Domain name dispute resolution policy that the applicant must represent that the registration of the domain name will not violate the rights of any third party. Under the policy if the domain name is registered for the purpose of selling or transferring to the complainant it will be treated as registered in bad faith. According to the learned counsel for the respondent, since the petitioner himself offered to purchase the domain name, he cannot file the suit. But this offer was through a third party to make sure that the respondent registered it only for the purpose of selling.

15. The learned counsel for the respondent submitted that the words Pen and Books are generic names and no one can claim monopoly in it. Though the two words are generic in nature when they are combined they get an identity of its own and is identified with the petitioners establishment for years together. They are not as generic as "mutual fund" or "Kabadibazar" with respect to which the courts have taken the view that they are generic words and nobody can monopolise it.

16. The learned counsel for the respondent also contended that the trial Court has only taken into the work done by some unemployed youths in preparing the advertisement only should nothave filed this appeal. As already noticed the amounts if any are not due to the respondent but to Ind-Us Graphics & Internet and it cannot be considered in the present suit.

From what has been stated I am also satisfied that the plaintiff had made out a prima facie case and the balance of convenience is also in its favour and the injunction granted was valid. But the condition imposed was unnecessary as the dispute was not between the parties and that the condition is deleted and the appeal is allowed to that extent. The respondent is restrained by an order of temporary inj unction from using the trade name WWW.Penbooks.com or offering the domain name for sale or alienating the domain name to any other persons. The cross objection is dismissed. The parties shall bear their costs in this appeal.