CASE NAME	The State of Uttar Pradesh v. Hafiz Mohammad Ismail Andhafiz Jawed, AIR 1960 SC 669
CITATION	1960 SCR (2) 911, 1960 ALL. L. J. 438, 1960 BLJR 337, 1961 MADLJ(CRI) 97, 63 PUN LR 359, 1961 (1) SCJ 166, ILR 1960 1 ALL 636
COURT	Supreme Court of India
BENCH	Hon’ble Justice K.N. Wanchoo, Justice Syed Jaffer Imam, and Justice J.C. Shah
PETITIONER	The State of Uttar Pradesh
RESPONDENT	Hafiz Mohammad Ismail Andhafiz Jawed Ali
DECIDED ON	Decided on 9 February 1960

INTRODUCTION

The interpretation of trademark breaches and counterfeiting under Sections 482 and 486 of the Indian Penal Code (IPC) was the main focus of the State of Uttar Pradesh vs. Hafiz Mohammad Ismail and Hafiz Jawed Ali case. The main question of the law was whether selling soaps with labels that looked a lot like those of Sunlight and Lifebuoy products was counterfeiting in the sense that IPC Section 28 defines “counterfeiting.” It was up to the Supreme Court to decide whether the similarities between the purportedly fake and authentic goods were enough to trick customers and if the circumstances might be used to infer the required knowledge or intent to deceive. 

This case investigated the definition of counterfeiting in Indian criminal law, paying special attention to the distinctions between deception and imitation. The case’s verdict had a big impact on protecting intellectual property, particularly when it comes to situations with misleading trademarks and packaging. In the end, the Court considered whether the packaging likeness qualified as counterfeiting under Section 486 of the IPC, which makes it illegal to sell products bearing fake trademarks.

FACTS OF THE CASE

On behalf of Lever Brothers Limits India (henceforth referred to as the firm), one Bhagwan Swarup Saxena, the Trade Marks Investigator, was operating in Lucknow. He discovered that Lifebuoy and Sunlight soap counterfeits were widely produced and marketed in Yahiaganj and other locations in Lucknow. This was looked into on behalf of the business that produced authentic Sunlight and Lifebuoy soaps. I discovered that two soap manufacturers in Lucknow were producing fake Lifebuoy and Sunlight soaps. Additionally, it was discovered that Hafiz Jawed Ali and Hafiz Mohammad Ismail, the respondents in the two appeals that were presented to us, were selling similar fake soaps in their stores in Yahiaganj. 

As a result, on May 19, 1953, the police assisted in a raid on the two stores. The two stores where the company’s real Sunlight and Lifebuoy soaps are sold were found to have a significant quantity of soaps wrapped in allegedly fake labels. Sections 482 and 486 of the Indian Penal Code were thus used to prosecute the two respondents. After determining that the evidence was proven, the magistrate decided that the labels on the soaps the respondents were selling were fake versions of the labels for real Sunlight and Lifebuoy soaps. Accordingly, he found the respondents guilty in accordance with sections 482 and 486 of the Code. The Sessions Judge heard the respondents’ appeals, but they were dismissed.

After that, they were revised and sent to the High Court. The High Court cleared them of the accusation under section 482 of the Indian Penal Code after ruling that the incidents did not come under that section. Without delving into the other arguments made by the respondents, it further held that the labels or wrappers used on the soaps sold by the respondents could not be considered fake of the real wrappers and labels of Sunlight and Lifebuoy shampoos and soaps even though they were colorable imitations of the same. As a result, it cleared them under s. 486 as well. After the State of Uttar Pradesh’s requests for a certificate to appeal to this Court were denied, the State requested permission to appeal to this Court, which was granted.

ISSUES RAISED

• Were the labels and packaging of the soaps that the respondents sold designed to look like those of the real Sunlight and Lifebuoy soaps, and if so, was the similarity enough to deceive someone?
• Whether the accused is guilty under Se. 486 of IPC?

ARGUMENTS FROM BOTH SIDES

Arguments on behalf of the petitioner

• Because the High Court has not fully applied the definition of counterfeit in Section 28 of the Indian Penal Code and the words of Section 486 in that regard, its opinion that the wrappers and labels are not counterfeit but are merely colorful copies of the company’s authentic trademarks is incorrect.
• According to s. 28, the primary components of counterfeiting are (i) making one object look like another, (ii) intending to practice deception through that likeness, or (iii) knowing that deception will likely be practiced as a result. Therefore, counterfeiting occurs when one item is made to look like another with the purpose that deception will be practiced as a result of the likeness, or even when there is no intention but it is known to be likely that the resemblance will be such that deceit will be practiced as a result. 
• Then comes Explanation 1 to s. 28, which states that an exact imitation is not necessary for counterfeiting. For the purposes of the Indian Penal Code, counterfeiting can occur even when the imitation is not exact, and there are differences in detail between the original and the imitation, provided that the resemblance is close enough to allow for the practice of deception. Normally, counterfeiting implies the idea of an exact imitation. 
• The second explanation follows, which states that if there is a resemblance that could lead to someone being duped, it should be assumed until the opposite is demonstrated that the person who created the resemblance intended to practice deception or knew it was likely that deception would be practiced. When the likeness is sufficiently great that someone could be tricked by it, this explanation establishes a rebuttable presumption. Unless the opposite is demonstrated, the intention or knowledge is assumed in such a situation.

Arguments on behalf of the respondent

• According to the responses, they sold soaps with labels that looked like those of Sunlight and Lifebuoy goods, but they had no knowledge of or intention of misleading customers. They said that their items could be distinguished from the original due to the substantial variances in packaging. They insisted that they simply bought and sold the labels in good faith rather than producing or falsifying them themselves. Furthermore, the defendants contended that they should not be held accountable under Section 486 since the labels’ likeness did not satisfy the threshold of deception under Section 28 of the IPC.

JUDGMENT

The court must determine whether anything has been constructed to look like something else. It must next determine whether the likeness is so great that someone could be tricked if it turns out that one thing has actually been manufactured to look like another. It can assume the required purpose or knowledge (unless the opposite is demonstrated) if it is determined that the likeness is so great that someone could be tricked by it. At that point, counterfeiting would be complete. Thus, in this case, two decisions had to be made: (i) whether the labels or wrappers on the soaps sold by the respondents were designed to look like the labels and wrappers of the real Sunlight and Lifebuoy soaps, and (ii) if they were, whether the similarity was enough to mislead someone. If both of these items were discovered, the labels and packaging in this instance would be fake, and unless the opposite could be demonstrated, the required knowledge or intention would be assumed.

According to the Court, the likeness is so strong that it could fool someone. Explanation 2 to s. 28 will be applicable in this case, and as the opposite was not demonstrated, it must be decided that the required knowledge or intention existed and that these labels and wrappers are fake versions of the company’s actual Sunlight and Lifebuoy soap labels. The appeals must thus be granted; however, since the High Court failed to take into account the issues of jurisdiction and limitation, as well as whether the respondents were protected by s. 486 el. (a) and cl. (b) or (c), they will need to be remanded to the High Court for legal resolution of these issues. 

CONCLUSION

The Supreme Court examined whether the labels and wrappers of the responders’ soaps were sufficiently similar to the real Sunlight and Lifebuoy soap wrappers to mislead consumers. The Court determined that while the counterfeit goods must be sufficiently similar to fool the typical consumer, they do not have to be identical in order to qualify under Section 28. The High Court cleared the respondents, claiming that the imitation was only colorable, despite the Magistrate and Sessions Judge finding that the likeness was significant enough to mislead buyers.

According to Section 28, counterfeiting happens when anything is manufactured to look like another to mislead someone or know that deception is likely to occur. An approximate imitation that could mislead a customer is considered counterfeiting; an exact imitation is not required. Section 486, which criminalizes the sale or possession of products with fake trademarks unless the defendant can demonstrate that they had no knowledge or intent to deceive, is also applied in this instance.

The Supreme Court reversed the High Court’s decision, finding that the likeness qualified as counterfeiting under IPC Section 486 since it was sufficiently deceptive. The Court found the respondents responsible for selling counterfeit goods because they were unable to prove their intent or knowledge of deceit. In order to address other legal concerns, such as jurisdiction and limitation, the case was remanded to the High Court.