Holding

The Commission erred in granting the interim injunction because the complaint did not allege the term "Suraksha Chakra" as an unfair trade practice and the complainant failed to establish a prima facie case of public deception, rendering the injunction invalid.

Summary

The Supreme Court examined two appeals arising from an order of the Monopolies and Restrictive Trade Practices (MRTP) Commission that restrained Colgate Palmolive India Ltd. from using the phrase "Suraksha Chakra" in its Colgate Dental Cream advertisements. The Commission had granted a temporary injunction under Section 12A of the MRTP Act despite the complaint not specifically alleging that the phrase constituted an unfair trade practice. The Court held that a temporary injunction can be granted only when the complaint alleges a specific unfair practice and the complainant establishes a prima facie case of public deception, which was absent. It also emphasized the need to comply with the procedural requirements of Regulation 76 and 77(2) and noted that the delay in filing the complaint was a relevant factor. Consequently, the Court set aside the injunction, allowing Colgate's appeal and dismissing Hindustan Lever's counter‑appeal.

Issues considered

Whether the MRTP Commission can grant a temporary injunction under Section 12A when the impugned representation is not specifically pleaded as an unfair trade practice.
Whether the Commission complied with the evidential and procedural requirements of Section 12A, Regulation 76 and Regulation 77(2) before granting the injunction.
Whether a prima facie case of likelihood of deception to the public existed in the present advertisement.
Whether the delay of more than thirteen years in filing the complaint barred the grant of an injunction.
Whether simple commendatory statements in advertising amount to an unfair trade practice under Section 36A.

Legislation cited

Code of Civil Procedure, 1908s. Order XXXIX Rules 2A-5
Monopolies and Restrictive Trade Practices Act, 1969s. 12A, s. 36A

Subjects

MRTP Acttemporary injunctionunfair trade practiceadvertising claimspublic interestSection 12ASection 36ASuraksha Chakraprima facie casedelay in filing

Judgment

A COLGATE PALMOLIVE (INDIA) LTD.
v.
HINDU ST AN LEVER LTD.

AUGUST 18, 1999

B [B.N. KIRPAL AND U.C. BANERJEE, JJ.]

Monopolies and Restrictive Trade Practices Act, 1969:

Section 12A (as amended by MRTP Amendment Act, 1984): ~-

c Grant of temporary injunction by the Commission-Scope of -In a
I
;

complaint being lodged by trader in respect of unfair trade practice-Held,
if Commission comes to a finding that there is likelihood of deception to the
public, then and in that event only, the question of grant of injunction would
arise-To appreciate the powers under Section 12A and to read the same in
D its proper perspective, Regulations 76 and 77(2) ought also to be noticed-
Regulation 76 provides that such application ought to be supported by an
affidavit stating the circumstances under which the trade practices can be
ascribed to be prejudicial to the interest of the public, consumer etc.-
Whereas Regulation 77(2) provides a safeguard that before making an order,
. E the Commission may direct an investigation by the DG-lnvestigation and to
submit a report to it, and upon consideration thereof, an appropriate order
may be passed by the Commission-Section 36-A-MRTP Regulations 1991,
Regulations 76 and 77(2).

Grant of temporary injunction-Commission's power under-Held,
.F somewhat akin to that of the Civil Court under Rules 2A to 5 of Order XXXIX
of the Code of Civil Procedure-A/so held the jurisdiction of Commission is
purely discretionary in nature though ordered only on the exigencies of the
situation and not as a matter of course in accordance with known principles
of law-Civil Procedure Code, 1908, Order 39 Rules 2A to 5-Grant of
temporary injunction-Delay/latches in approaching the Commission-Effect
G of-Held, a relevant factor for grant or refusal to grant such injwiction and
such delay cannot be ignored.

Section 36-A-unfair trade practice-Trade advertisement-Simple
commendation of the quality of goods by the seller, unless intended to be a
H warranty, would not amount to unfair trade practice-Extent of latitude
560
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. 561
allowed in an advertisement. A
Civil Procedure Code, 1908:

Order 39-/njunction--Object of-Held, to protect the plaintiff against
the injury by reason of violation of his right and relief by way of interlocutory
injunction granted to mitigate the risk of injustice to the plaintiff during the B
period before the uncertainty could be resolved

Order 39-:Temporary Injunction-Grant of-Advertisement issued by
appellant claiming that Colgate Dental Cream acts as germs fighter, fights
tooth decay and stop bad breath and hence provides a safety ring around
family as "Suraksha Chakra"-Respondent made a complaint to the C·
Commission that the claims of the appellant was highly misleading qua the
consumers and trade-No allegation in the complaint against the term
"Suraksha Chakra", not notice of inquiry containing any reference that this
being unfair trade practice-Held, in the absence of any evidence regarding
the basic a/legation of germs fighting, tooth decay. and bad breath-No D
prima facie case made out warranting issue of temporary injunction against
use of words "Suraksha Chakra" against the appellant-

Maxims- "Simplex commendatio non obligate-Meaning of

Appellant started its advertisement campaign for 'Colgate Dental Cream' E
using the phrase "Stop bad breath" and "Fight tooth decay" from 1960. The
user of the words "Suraksha Chakra" commenced however, from 1985. In
March 1997, the respondent complained to the Advertising Standard Council
of India (ASCI) against Appellant's advertisement in respect of Colgate
Dental Cream. The Consumer Complaint Council of ASCI scrutinised the
appellant's advertisement in detail and came to a finding that the same does F
not in any way be termed to be unfair or deceptive. Significantly, however,
though there was a provision for review, respondent did not choose to proceed
with the matter and allowed the matter to be set at rest.

On October 15, 1997, appellant filed a complaint before the MRTP G
Commission against respondent by reason of the respondent's advertisement
wherein it was stated that the respondents' product "New Peposodent" had
102% more germs fighting capability as compared to the 'leading toothpaste'.
According to the appellant this 'leading toothpaste' could not but referred
to 'Colgate Toothpaste' and as such the advertisement was directly aimed at ·
disparagement of the appellant's product namely Colgate Dental Cream. On H
562 SUPREME COURT REPORTS [1999) SUPP. I S.C.R.

'A October 22, 1997, the respondent also filed a complaint before MRTP
Commission against appellant's advertisement in respect of 'Colgate Dental
Cream', which was ascribed to be purely as a counter blast. The main
grievance of the respondent before the Commission was that the appellant's
claim that its toothpaste was a "Germ fighter" having the ability to "stop bad
B breath" and "fight tooth decay" were highly misleading qua the consumers
and the trade. However, the Commission took the view that without going
through the evidence it was neither feasible nor proper. to pass any order in
respect of the alleged claim of the appellant that Colgate D~ntal Cream
fights germs and tooth decay and stops bad breath but passed an order
restraining the appellan,t from displaying the ring round the family as
C "Surksha Chakra" in appellant's hoarding, print advertisements and on T.V.
Hence this appeal.

It was contended by the appellants that the ring could not but be termed
as an incidental issue of the three broad heads of grievance, no injunction
D was warranted; that the allegations of unfair and restrictive trade practices
being a rather serious allegation of misconduct as regards the trade, there
ought to be specific pleading in the complaint as also in the notice of inquiry
together with full particular thereof and the absence thereof, the question
of any credence would not arise, far less the grant of an order of injunction;
the Commission as a matter of fact was persuaded to issue interim order
E pertaining to "Suraksha Chakra" by reason of the factum of an order of
injunction granted by the Federal Trade Commission in the USA wherein a
complaint was made by the respondent's parent company in USA in respect
of Colgate Dental Cream with Gardol, that in the US advertisement, there
was an invisible shield protecting the tooth whereas in the present impugned
F advertisement, there was no such protection but it was the resultant effect
of the foaming action which helped in stopping bad breath and tooth decay;
that Hindi word "Suraksha" has meaning in common acceptation and implied
safety and the Hindi word "Chakra" meant a wheel or a disc and the words
put together could not be equated or understood to mean an invisible shield
which wo~ld protect the tooth as was available in the US advertisement; and
G that the advertisement of invisible shield and representation as to the degree
or extent of protection was found to be false, misleading and deceptive by
Federal Trade Commission and an order was passed directing the respondent's
parent company to cease and desist from representing directly or by ·
implication that Colgate Dental Cream with Gardol afforded to users complete
H protection against tooth decay or development of cavities in their teeth.
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. 563

Allowing the appeal, the Court A
HELD: 1.L MRTP Act as originally framed d_id not confer any.iJOwer
to the Commission to grant temporary injunction during the coutse of
inquiry. The Sachhar Committee report however, recorded that p~wer to
issue temporary injunction order ought to be made available to the Commission
in order to give effect and strengthen the jurisdiction and, authority of the B
Commission and it is by reason therefor the legislature thought it fit to
incorporate Section 12 A in the body of the Act by MRTP Amendment Act,
1984 conferring such a power to the Commission. [567-D-F]

1.2. While it is true that the conferment of power, under Section 12~., C
has very wide remifications but the legislature was itself conscious ebough
to record in the body of the Section certain in-built requirement to be
fulfilled in order to clothe the Commission with the authority and jurisdiction
in the matter of grant of an order of injunction and it is on this perspective
that Section 12A ought to be noticed. [567-F-GJ
D
1.3. The Commissions power can be invoked under Section 12A within
however such limits and restrictions as provided in the Section itself. For
an appreciation of powers under Section 12A and to read the same in its
proper perspective, Regulation 76 and 77(2) of the MRTP Regulations 1991
ought also to be noticed. Regulation 76 provides that an application (or the
grant of temporary injunction ought to be supported ·by an ~ffidavit stating E
therein the circumstances under which the trade practices can be ascribed
to be prejudicial to the interest of the public, consumer etc. and Regulation
77(2) provides a safeguard to the effect that the Commission before making
an order under Section 12A, may direct the Director General of investigation
to make an investigation and submit a report to the Commission afid the F
Commission, upon consideration thereof, may pass appropriate orders in
regard thereto. (569-A-C]

1.4. In the event of a complaint being lodged by a trader in respect of
unfair trade practice, it is for the trader to convince by way of 'evidence-
sufficient' that there is involved an element of public interest in the complaint, G
in order to obtain an order of injunction in terms of Section 12A and the
Commission in its turn, has thus to consider as to whether or not, the public
are being deceived or likely to be deceived and in the event, the Commission
. comes to a finding that there is likelihood of such a deception, then and in
that event only, the question of grant of an order of injunction would. arise.
The Commission's powers to grant temporary injunction is somewhat akin H
564 SUPREME COURT REPORTS [1999] SUPP. 1 S.C.R.

A to that of the Civil Court under Rules 2A to 5 of Order X:XXIX of the Code
of Civil Procedure. [569-D-F)

.1.5. The bro~d legislative perspective in the matter of conferment of
power and authority to th.e Commission in regard to the grant of injunction-
be it statutory or otherwise-involving equitable considerations and the same
B being purely discretionary in nature though ordered only on the exigencies
of the situation and not as a matter of course in accordance with the known
principles of law. (569-F-H]

2. The object of interlocutory injunction is to protect the plaintiff
against injury by reason of violation of his right and relief by way of
C interlocutory injunction is granted to mitigate the risk of injustice to the
plaintiff during the period before the uncertainty could be resolved. Generally,
however, the interlocutory remedy by way of grant of an order of injunction
is intended to preserve and maintain in status quo the rights of the parties
and to protect the plaintiff, being the initiator, of the action against incursion
D of his rights and for which there is no appropriate compensation being
quantified in terms of damages. The basic principle of the grant of an order
of injunction is to assess the right and need of the plaintiff as against that
of the defendant and a duty incumbent on to the law courts to determine as
to where the balance lies. Another redeeming feature in the matter of grant
of interlocutory injunction is .that, in the event of a grant of injunction in
E regard to a party defendant where the latter's enterprise has commenced and
in that event the consideration may be somewhat different from that where
the defendant is yet to commence its enterprise. 1570-A-CJ

Wander ltd. v. Antox India, (P) Ltd., (1990) Supp SCC 727; Power
F Con,trol Appliances v. Sumeet Machines (P) Ltd., (.1994) 2 SCC 448 and
Gujarat Bottling Co. Ltd. v. Coca Cola Co., (19951 5 SCC 545: AIR [1995)
SC 2372, referred to.

American Cyanamid Co. v. Ethican Ltd., (1975)1 ALL ER 504; J.T.
Stratford & Sons Ltd. v. Lindley, (1965)AC 269; Dimbleby & Sons Ltd. v.
G National Union of Journalists, (1984) I All ER 751; Series 5 Software v.
Clarke & Ors., (1996) 1 All ER 853 and Hubbardv. Vosper, (1972) I All ER
1023: (1972) 2 QB 84, referred to.

3. A distinction shall always have to be made as latitude is allowed in
the event of there being an advertisement to gain a purchaser or two. The
H latitude spoken of, however, cannot and does not mean any misrepresentation
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. 565
by description of permissible assertion. Further, assuming there was in fact A
(567-D-F)an express warranty but that by itself would necessarily result
from a "simple commendation of the quality of goods by the seller": for in
this case the rule of civil law, "simplex commendatio non obligate" - simple
commendation can only be regarded as a mere invitation to a customer
without any obligation as regards the quality of goods: every seller will B
naturally try and affirm that his wares are otherwise good to be purchased
unless of course the same appears to be on evidence that the commendation
was intended to be a warranty. The popular English saying "in a purchase
without warranty, one's eyes tastes and senses must be his protector" has
its definite connotation and its application is a matter of the nature as the
present one. (581-G-H; 582-D-E) C
Lakhanpal National Ltd. v. MR.T.P. Commission, (1989) 3 SCC 251,
relied on.

Tata Press Ltd. V. Mahanagar Telephone Nigam Ltd., [1995) 5 SCC
139; HMM Ltd. v. MR. T.P. Commission, (1998) 6 SCC 485, referred to. D

Dimmack v. Hallett, f18661LR2, Ch. App. 2 and Smith v. Land & House
Property Corporation, (1884) 28 Ch. D. 7, referred to.

Anson's law of Contract, (27th Edn.), referred to.
E
4.1. The allegations in the complaint filed by the respondent stand
restricted or confined to Colgate's claim of "germ fighting", "bad breath"
and "tooth decay~·. The Commission rightly took the view that without going
through the evidence, it is neither feasible nor proper in any event to pass
any orders thereon at that juncture. [581-B; 589-C)
F
4;2. While not disturbing the three specific features available in the
complaint, viz. germ fighting, tooth decay and bad breath, by reason of lack
of evidence, the commission erred in taking up for consideration the issue
of Suraksha Chakra which was an incidental issue wholly d.ependant upon
those three specific features and issuing the injunction, when there was no G
allegation in the complaint against the term "Suraksha Chakra" more even
an allegation that the same is misleading or an unfair trade practice. The
notice of enquiry also does not contain any reference to "Suraksha Chakra"
as unfair trade practice or there being any involvement or any falsity or that
. in any way the same tantamounts to a misleading information to the people
at large. There was no evidence of a single consumer being misled or not H
566 SUPREME COURT REPORTS [1999] SUPP. 1 S.C.R.

A a whiisper as to what-constituted an unfair trade practice pertaining to
"Sur~ksha Chakra". The Commission also thought it fit not to record any
reaSOfl or justification for the grant of an interim order of injunction•.
. (581-A-B; E)

4.3. The factum of non-availability of any explanation for more than 13
B years' delay has also not been delved into by the Commission at all. It is not
possible to accept the contention that the complaint pertains to vindication
of a public right and since the public interest is involved, the question of ~ny
delay for moving the Commission does not arise and more so, it is a remedy
to put>lic wrong and not a personal relief. Public wrong, if any, needs to be
C asses$ed and proved, without which the question of having an order of
injunction would not arise. While it is true that the relief prayed for is
statutory in nature but that does not clothe the Commission with power to
pass orders dehors the basic principles of law. [588-F-H; 589-F)

· 4.4. Moreover, the- submission as regards the bona jides of the
D appli~ation under Section 12-A cam~ot also-be brushed aside and non-
. consideration thereof by the Commission ha~ resulted in a clear error on
. the part of the Commission. The fact that with.in a period of 10 days of the
. appli~ation by.the appellant before the Commission, the respondent filed the
'\
inStatft complaintwith an application for an interim prayer-though, however,
·this l'Suraksha Chakra" admittedly is available in .the commercial
E adve.rtisement since 1985 and irithe visual advertisement in Hindi at least
since 1987- there was no lodgement of any protest or complaint in public
inter~st but it was only filed as a backlash on the appellant's complaint and
the motive therein cannot also be ruled out..Therefore, the question of there
being any order of injunction at this stage of the proceedings on the face of
F th~ findings as passed by the Commissfon itself does not and cannot arise.
[589-A-B; Fl

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2620of1998
Etc.

G From the Judgment and Order dated 30.4.98 of the M.R.T.P. Commission,
New Pelhi in U.T.P.E. No.415of1997.

Kapil Sibal, Dr. A.M. Singhvi, Ashok H. Desai, R.N. Karanjawala, S.
Ganei;h, G.aurab Banerjee, Ms. Nandini Gore, Ms. Ruby Singh Ahuja and Ms.
Manil< Karanjawala, for the Appellant in C.A. No. 2620/98 and for Respondent
H No. 1 in C.A. No. 3288/98
COLGATE PALMOLIVE(INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 567

Rakesh Dwivedi, Harish N. Salve, Dalip Kumar Malhotra and Rajesh A
Malhotra, for the Respondent in C.A.No.2620/98 and for appellant in C.A. No.
3288198.

1 P. Parmeswaran, (NP) for the Respondent No. 2 in C.A.No. 3288/98

The Judgment of the Court was delivered by B
BANERJEE, J. These two appeals under Section 55 of the Monopolies
and Restrictive Trade Practices Act (hereinafter referred to as the 'MRTP
Act') are directed against the order of the Monopolies and Trade Practices
Commission under Section 12 A of the MRTP Act dated 30th April, 1998 in C
matter No. UTPE 415 of 1997. The matter pertains to colgate toothpaste, a
product of Colgate Palmolive India Limited and by reason of a complaint from
M/s. Hindustan Lever Limited being the Appellant in the 2nd appeal. Whereas
CA No.2620 of 1998 is against the order of the Commission containing an
order of restraint as regards the display of the ring round the family as
"Suraksha Chakra" in Colgate Palmolive's hoardings, print advertisements D
and T.V. commercials, the CA No. 3288of1998 filed by M/s. Hindustan Lever
Limited is against the order of refusal on the part of the Commission to put
a total ban on the product of the Colgate Palmolive as noticed above.

Before adverting to the rival contentions, be it noted that the M.R.T.P.
Act as originally framed did not confer any power on to the Commission to E
grant temporary injunction during the course of inquiry. The Sachhar Committee
report however, recorded that power to issue temporary injunction order
ought to be made available to the Commission in order to give effect and
strengthen the jurisdiction and authority of the Commission and it is by
reason therefor the legislature thought it fit to incorporate Section 12A in the F
body of the Act by MRTP Amendment Act 1984 conferring such a power to
the Commission.

While it is true that the conferment of power, under Section 12A, has
very wide ramifications but the legislature was itself conscious enough to
record in the body of the section certain in-built requirements to be fulfilled G
in order to clothe the Commission with the authority and jurisdiction in the
matter of grant of an order of injunction and it is on this perspective that
Section 12A ought to be noticed at this juncture. Section 12A reads as
below:-

"12A Power of the Commission to grant temporary irijunctions- H .··
568 SUPREME COURT REPORTS [1999) SUPP. I S.C.R.

A (1) Where, during an inquiry before the Commission, it is proved,
whether by the complainant, Director General, any trader or class of
traders. or any other person, by affidavit or otherwise, that any
undertaking or any person is carrying on, or is about to carry on, any
monopolistic or any restrictive, or unfair, trade practice and such
monopolistic or restrictive, or unfair trade practice is likely to affect
B prejudicially the public interest or the interest of any trader, class of
traders or traders generally or of any consumer or consumers generally,
the Commission may, for the purposes of staying or preventing the
undertaking or, as the case may be, such person from causing such
prejudicial effect, by ·order, grant a temporary injunction restraining
c such undertaking or person from carrying on any monopo1istic or
restrictive, or unfair, trade practice until the conclusion of such inquiry
or until further orders.

(2) The provisions of rules 2A to 5 (both inclusive) of order XXXIX
of the First Schedule to the Code of Civil Procedure, 1908 ( 5 of 1908)
D shall, as far as may be, apply to a temporary injunction issued by the
Commission under this section, as they apply to a temporary injunction
issued by a Civil Court, and any reference in any such rule to a suit
shall be construed as a reference to an inquiry before the Commission.

[Explanation I- For the purposes of this section an inquiry shall be
E deemed to have commenced upon the receipt by the Commission of
any complaint, reference or as the case may be, application or upon
its own knowledge or information reduced to writing by the
Commission.

Explanation II-For the removal of doubts, it is hereby declared thatthe
F power of the Commission with respect to temporary injunction includes
power to grant a temporary injunction without giving notice to the
opposite party.]"

On a plain reading of the provision the following requirements thus
emerge:-
G
(a) Temporary injunction can be granted only during an inquiry.
(b) There must be proof of certain practices mentioned therein to
have been carried on or are about to be carried on by the person
specified therein.
H (c) Such practices are likely to affect prejudicially the public interest
COLGATEPALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 569

.... and there must be some evidence either by way of an affidavit A
or otherwise.

The situation thus after the incorporation of the Act of 1984, in the
Statute Book emerges that the Commission's power can be invoked under
Section l 2A within however such limits and restrictions as noticed above. Be
it placed on record, that for an appreciation of the powers under Section I2A B
and to read the same in its proper perspective, Regulations 76 and 77 (2) of
the MRTP Regulations 1991 ought also to be noticed. Regulations 76 provides

-
that an application for grant of temporary injunction ought to be supported
by an affidavit stating therein the circumstances under which the trade
practices can be ascribed to be prejudicial to the interest of the public, C
consumer etc. and Regulation 77(2) provides a safeguard to the effect that the
Commission before making an order under Section 12A, may direct the Director-
General of Investigation to makt an investigation and submit a report to the
Commission and the Commission, upon consideration thereof, may pass
appropriate orders in regard thereto.
D
Incidentally, be it noted that in the event of a complaint being lodged
by a trader in respect of unfair trade practice, it is for the trader to convince
by way of 'evidence-sufficient' that there is involved an element of public
-· interest in the complaint, in order to obtain an order of injunction in terms of
Section l 2A and the Commission in its turn, has thus to consider as to E
whether or not, the public are being deceived or likely to be deceived and in
the event, the Commission comes to a finding that there is likelihood of such
a deception, then and in that event only, the question of grant of an order
of injunction would arise.

Needless to record here that the Commission's powers to grant temporary F
injunctions is somewhat akin to that of the Civil Court under Rule 2A to 5
of order XXXIX of the Code of Civil Procedure.

Having dealt with however, the broad legislative perspective in the
matter of conferment of power and authority on to the Commission in regard G
to the grant of injunctions and whilst on the subject let us however discuss
the state of the law in the matter of grant of an order of injunction be it
statutory or otherwise involving equitable considerations and the same being
purely discretionary in nature though ordered only on the exigencies of the
situation and not as a matter of course in accordance with the known principles
~~ H
570 SUPREME COURT REPORTS [1999) SUPP. I S.C.R.

A Generally, however, the interlocutory remedy by way of a grant of an
order of injunction is intended to preserve and maintain in status quo the
rights of the parties and to protect the plaintiff, being the initiator, of the .
action against incursion of his rights and for which there is no appropriate
comp~nsation being quantified in terms of damages. The basic principle of the
B grant of an order of injunction is to assess the right and need of the plaintiff
as against that of the defendant and it is a duty incumbent on to the law
courts to determine as to where the balance lies.

Another redeeming feature in the matter of grant of interlocutory
injunction is that, in the event of a grant of 'injunction in regard to a party
C defendant where the latter's enterprise has commenced and in that event the
consideration may be somewhat different from that where the defendant is yet
to commence its enterprise.

The decision of this Court in Wander Ltd v. Antox India P. Ltd., [1990] -
.Supplement sec 727 lend support to the observations as above.
D
This Court in paragraph 9 of the Report observed:

"Usually, the prayer for grant of an interlocutory ·injunction is at a
stage when the existence of the legal right asserted by the plaintiff
and its alleged violation are both contested and uncertain and remain
E uncertain till they are established at the trial on evidence. The court,
at this stage, acts on certain well settled principles of administration
of this form of interlocutory remedy which is both temporary and
discretionary. The object of the interlocutory injunction, it is stated

" .. is to protect the plaintiff against injury by violation of his rights
for which he could not adequately be compensated in damages
recoverable in the action ifthe uncertainty were resolved in his favour
at the trial. The need for such protection must be weighed against the
corresponding peed of the defendant to be protected against injury
resulting from his having been prevented from exercising his own
legal rights for which he could not be adequately compensated. The
G
Court must weigh one need against another and determine where the
'balance of convenience' lies."

The interlocutory remedy is intended to preserve in status quo,
the rights of parties which may appear on a prima facie case. The
H court also, in restraining a defendant from exercising what he considers
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 571

his legal right but what the plaintiff would like to be prevented, puts A
into the scales, as a relevant consideration whether the defendant has
yet to commence his enterprise or whether he has already been do"ing
so in which latter case considerations somewhat different from those
that apply to a case where the defendant is yet .to commence his
enterprise, are attracted."
B
Incidentally, the House of Lords prior to the decision in American
Cyanamid Co. v. Ethican Ltd, [1975] I All ER 504 in J.T. Stratford & Sons
Ltd v. Lindley, (I 965) AC 269 in no uncertain terms laid down that the plaintiff
had to show a strong prima facie case that his rights has been infringed and
thereafter the plaintiff was required to show that the damages would not be C
an adequate remedy in the event of there being a success of the plaintiff at ·
the trial and that the balance of convenience favoured the grant. This
requirement, however, in the matter of grant of an injunction so far as the
English Courts are concerned, stands slightly diluted by reason of the decision
in American Cyanamid's case (supra) which records that in the event of there
being a serious issue to decide, the grant would be available to a plaintiff on D
however, compliance with the other fundamentals as noticed below. A strong
prima facie case, therefore, stands substituted by a serious issue to be
decided.

At this juncture, however, the decision of the House of Lords in American
Cyanamid's case though raised certain eye-brows lately, ought to be considered E

.. in slightly more greater detail.

Lord Dip/ock in Cyanamid's case laid down the following guiding
principles for the grant of interlocutory injunction:

(I) "The plaintiff must first satisfy the Court that there is a serious F
issue to decide and that if the defendants were not restrained
and the plaintiff won the action, damages at common law would
be inadequate compensation for the plaintiffs loss.

(2) The Court, once satisfied of these matters will then consider
whether the balance of convenience lies in favour of granting G
injunction or not, that is, whether justice would be best served
by an order of injunction.

(3) The Court does not and cannot judge the merits of the parties's
respective cases and that any decision of justice will be taken
in a state of uncertainty about the parties' rights." H

-~-
572 SUPREME COURT REPORTS [1999] SUPP. I S.C.R.

A It would seem to follow therefore, that what should be borne in mind,
in addition to what has been phrased in Lord Diplock's speech, is that ifthere
is uncertainty, the Court should be doubly reluctant to issue an injunction,
the effect of which is to settle the parties' rights once for all.

On a clear analysis of the speech of Lord Diplock, it appears that if
B damages, recoverable at common law, would be an adequate remedy and the
defendant Would be in a financial position to pay the same, no interlocutory
injunction should normally be granted, howsoever strong the plaintiffs claim
appear to be at that stage. Lord Diplock went on to observe further that in
the event of there being any doubt, as to the adequacy of the respective
C remedies and damages available to either party or both, then and in that
event, the question of balance of convenience arises and the same will vary
from case to case.

Similar view has also been expressed by the House of Lords in the case
of Dimbleby & Sons Ltd v. National Union of Journalists, ( 1984) l ALL ER .
--
D 751).

In Power Control Appliances v. Su meet Machines Ltd., [1994] 2 SCC
448) this Court did follow the decision of this Court in Antox India's case
(supra) and expressly approved the main dicta of the House of Lords in ....
American Cyanamid's case.
E

-
In Gujarat Bottling Co. Ltd. v. Coca Cola Co. and Ors., [1995] 5 SCC
545: AIR (1995) SC 2372 this Court however sounded a different note, though
however, emphasised the discretionary power in the malter of grant of
interlocutory injunction and in paragraph 43 this Court observed:

F "43. The grant of an interlocutory injunction during the pendency of
legal proceedings is a matter requiring the exercise of discretion of the
court. While exercising the discretion the court applies the following
tests - {i) whether th.e plaintiff has a prima facie case; (ii) whether the
balance of convenience is in favour of the plaintiff; and (iii) whether
the plaintiff would suffer an irreparable injury if his prayer for
G interlocutory injunction is disallowed. The decision whether or not to
grant an interlocutory injunction has to be taken at a time when the
existence of the legal right assailed by the plaintiff and its alleged
violation are both contested and uncertain and remain uncertain till ..
they are established at the trial on evidence. Relief by way of
H interlocutory injunction is granted to mitigate the risk of injustice to
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 573

the plaintiff during the period before that uncertainty could be resolved. A
The object of the interlocutory injunction is to protect the plaintiff
against injury by violation of his right for which he could not be
adequately compensated in damages recoverable in the action if the
uncertainty were resolved in his favour at the trial. The need for such
protection, has, however, to be weighed against the corresponding
need of the defendant to be protected against injury resulting from his B
having been prevented from exercising his own legal rights for which
he could not be adequately compensated. The court must weigh one
need against another and detennine where the "balance of convenience"
lies. (see: Wander Ltd v. Antox India, (P.) Ltd, [1990] (supp.) SCC at
pp. 731-32.) In order to protect the defendant while granting an C
interlocutory injunction in his favour the court can require the plaintiff
to furnish an undertaking so that the defendant can be adequately
... compensated if the uncertainty were resolved in his favour at the
trial".

As noted above, lately the 'triable issue concept' as introduced by Lord D __.
Diplock in Cyanamid's case has been thought to be much too rigid and wide
even conceptually and doubts are even raised as to its legal efficacy having
regard to the facts of adequate compensation theory. As a matter of fact the
Courts in England have even gone to the extent of ascribing the judgment
to be beneficial for the richer sections of the society! We however can not E
subscribe to such a view, neither find any justification for such uncharitable
comments and it seems that Cynamid's decision has been more misunderstood
than understood and in this regard we record our concurrence with the views
expressed by Laddie J. in Series 5 Software v. Clarke and Others in, (1996)
1 ALL ER 853 wherein the learned Judge has explained the judgment of
American Cyanamid with extreme competency and in our view also correctly F
Laddie, J. observed:

"In many cases before American Cyanamid the prospect of success
was one of the important factors taken into account in assessing the
balance of convenience. The courts would be less willing to subject
the plaintiff to the risk of irrecoverable loss which would befall him G
if an interlocutory injunction was refused in those cases where it
thought he was likely to win at the trial than in those cases where it
thought he was likely to lose. The assessment of the prospects of
success therefore was an important factor in deciding whether the
court should exercise its discretion to grant interlocutory relief. It is H
574 SUPREME COURT REPORTS [1999] SUPP. I s.'c.R.

A this consideration which American Cyanamid is said to have prohibited
in all but the most exceptional case. So it is necessary to consider with
some care what was said in the House of Lords on this fasue.

Lord DiplockSaid, (1975) l ALL ER504 at 511, [1975] AC 396 at409:

' .. if the extent of the uncompensatable disadvantage to each party
B
would not differ widely, it may not be improper to take into .account
in tipping the balance the relative strength of each party's case as
revealed by the affidavit evidence adduced on the hearing of the
application.. The court is not justified in embarking on anything
resembling a trial of the action on conflicting affidavits in order to
c evaluate the strength of either party's case.'

It appears to me that there is nothing in ·this which is inconsistent
with the old practice. Although .couched in terms 'it may not be
improper', this means that it is legitimate for the court to look at the
relative strength of the parties' case as disclosed by the affidavit!\.
D The warning contained in the second of the quoted senten~es is to
avoid courts at the interlocutory stage engaging in mini-trials, which
is what happened, at least in the Court of Appeal, in American
Cyanamid itself. Interlocutory applications are meant to come on quickly
and to be disposed of quickly.
E The supposed problem with American Cyanamid centres on the
following statement by Lord Diplock, ((1975) AC 396 at 409):

'[Asssessing the relative strength of the parties' cases], however,
should be done only where it is apparent upon the facts disclosed by
evidence as to which there is no credible dispute that the strength of
F one party's case is disproportionate to that of the other party.'

If this means that the court cannot take into account its view of the
strength of each party's case if there is any dispute on the evidence,
as suggested by the use of the words 'only' and 'no credible dispute',
then a new inflexible rule has been introduced to replace that applied
G by the Court of Appeal. For example, all a defendant would have to
do is raise a non-demurable dispute as to releva!lt facts in his affidavit
evidence and then he could invite the court to ignore the apparent
strength of the plaintiffs case. This would be inconsistent with the
flexible approach suggested in Hubbard v. Vosper, [ 1972] l ALL ER
H 1023, [1972] 2 QB 84 which was cited with approval earlier in American
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTl). [BANERJEE, J.] 575

- Cyanamid, (1975) 1 ALL ER 504 at 510, (1975) AC 396 at 407.
Furthennore, it would be somewhat strange, since American Cyanamid
directs courts to assess the adequacy of damages and the balance of
A

convenience, yet these too are topics which will almost always be the
subject of unresovled conflicts in the affidavit evidence.

In my view Lord Diplock did not intend by the last-quoted B
passage to exclude consideration of the strength of the cases in most
applications for interlocutory relief It appears to me that what is

-
intended is that the court should not attempt to resolve dif!icult
issues offact or law on an application for interlocutory relief If, on
the other hand, the court is able to come to a view as to the strength C
of the parties ' cases on the credible evidence, then it can do so.

-
(Emphasis supplied)."

The learned Judge, thereafter went on to record that the House of Lords
in American Cyanamid did not suggest that it was changing the basis upon
which most courts had approached the exercise of discretion in this important D
/ area.

Thus on an analysis of the decisions as noticed above, there does not
seem to be any difficulty in appreciating the view as expressed by Lord
Diplock in American Cynamid. As a matter of fact, laddie, J. 's decision in
Series 5 Software case (supra) has been able to resolve the issue without any E
departure from the true perspective of the judgment as noticed above.

We, however, think it fit to note herein below certain specific
considerations in the matter of grant of interlocutory injunction, the basic
being-non~expression of opinion as to the merits of the matter by the Court,
since the issue of grant of injunction usually, is at the earliest possible stage F
so far as the time frame is concerned. The other considerations which ought
to weigh with the Court hearing the application or petition for the grant of
injunctions are as below:-

(i) Extent of damages being an adequate remedy;
G
(ii) Protect the plaintiffs interest for violation of his rights though
however having regard to the injury that may be suffered by the
defendants by reason therefor;
(iii) The court while dealing with the matter ought not to ignore the
factum of strength of o_pe' party's case being stronger than the H
576 SUPREME COURT REPORTS [1999] SUPP. I S.C.R.

A others;
(iv) No fixed rules or notions ought to be had in the matter of grant
of injunction but on the facts and circumstances of each case
- the relief being kept flexible;
(v) The issue is to be looked from the point of view as to whether
B on refusal of the injunction the plaintiff would suffer irreparable
loss and injury keeping in view the strength of the parties case;
(vi) Balance of convenience or inconvenience ought to be considered
as an important requirement even if there is a serious question
.r
or prima facie case in support of the grant;
c (vii) Whether the grant or refusal of injunction will adversely affect
the interest of general public which can or cannot be
compensated otherwise.
It is on this backdrop that exercise of discretion by the Commission
D shall have to be considered and it is at this juncture certain further factual
details ought to be noted.

On the factual score it appears that the appellant started its advertisement
campaign for 'Colgate Dental Cream' using the phrase "Stop bad breath" and
"Fight tooth decay" from 1960. The user of the words 'Suraksha Chakra'
E commenced however from the year 1985.

The records depict that in March 1997 the Respondent in Civil Appeal
No.2620 of 1998 being Hindustan Lever, complained to the Advertising
Standards Council oflndia (ASCI) against Appellant's advertisement in respect
of Colgate Dental Cream. The Consumer Complaints Council of ASCI scrutinised
F the appellant's advertisement in detail and came to a finding that the same
does not in any way be termed to be unfair or deceptive. Significantly,
however, though there is existing a provision for review, the respondent has
chosen not to proceed with the matter and allowed the matter to be set at rest.

Subsequently, however on 15th October, 1997, the appellant herein filed
G a complaint before the MRTP Commission being No.UTPE 405of1997 against
respondent by reason of the Respondent's advertisement wherein it has been
stated that the Respondent's product "New Pepsodent',' had 102% more germ-
fighting capability as compared to the 'leading toothpaste'. According to the
Appellant this ·leading toothpaste' cannot but refer to 'Colgate Toothpaste' ·
and as such the advertisement is directly aimed at disparagement of appellant's
H product namely Colgate Dental Cream and it only thereafter the respondent
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 577

herein on 22nd October 1997, filed a complaint before MRTP Commission A
against Appellant's advertisement in respect of 'Colgate Dental Cream' which
is ascribed to be purely as a counter blast. We are not however expressing
any opinion in that regard.

Be that as it may, records depict that the complaint initiated by the
respondent herein contained three specific grievances relevant extracts thereof B
are set out herein below:-

"For the purpose of promoting the sale, use and supply of its said
product, Colgate Dental Cream, the Respondent has been using
television, POP (Point of Purchase), hoardings, radio and press
advertisement campaigns, which contain statements which are false C
and misleading. T.V. advertisements and storyboards of the same in
Hindi, along with their English translation, is annexed hereto and
marked as Annexure I (collectively). A copy of POP is also enclosed
as Annexure 2.

In the said advertisements for promotion of sale of Colgate Dental D
Cream (CDC), the Respondent has inter alia; made the following claims,
which it is submitted, are both false and misleading:
(a) The Respondent's CDC toothpaste is claimed to have action
of 'Germ Fighter', which is· projected as a process by which germ
activity (which is the root cause of oral problems viz. tooth decay and E
bad breath) is controlled.
(b) The Respondent's CDC toothpaste is stated to have the ability
to 'fight tooth decay'.

(c) The Respondent's toothpaste is stated to have the ability to F
'Stop bad breath'.

The above mentioned claims are false and highly misleading qua
the consumers and trade.

It is submitted that the advertisement of the Respondent's CDC G
toothpaste purport to set up "germs" as the cause of both toothdecay
and bad breath. It then suggests that Colgate Dental Cream has _a
special "Germ Fighter". The advertising then goes on to suggest that
as a result the toothpaste offers the benefit of Stops Bad Breath,
Fights Toothdecay" and provides a ring or circle of safety or protection.
The complainant craves leave to refer to and rely upon cassettes of H
578 SUPREME COURT REPORTS {1999] S~PP. 1 S.C.R.

A all these TV advertisements at the time of hearing.

The Complainant/Informant believe the impugned advertisement ·.
of Colgate Dental Cream has been on air since August 1996 claiming
"Germ Fighter" proposition. Prior to the impugned advertisement no
claim of any "Germ fighter" was made in respect of CDC. However, for
B last more than one year the Respondent have introduced new
advertising in which this new claim has been made even though there
has been no change in the ingredients of Colgate Dental Cream. Story·
boards of the adv~ising before August'9~ are annexed hereto and
marked Annexure 3."

C It therefore, appears that the principal grievance of the respondent
herein before the Commission is that the claim of the appellant that its
toothpaste is 'germ fighter' having the ability to 'stop bad breath' and its
ability to 'fight tooth decay' are highly misleading qua the consumers and the
trade. The complaint itself further records that the advertisement of the
D appellant purport to suggest that Colgate Dental Cream has a special germ
fighter and thereafter the complainant records as a result, the toothpaste
offers the benefit of stoppage of 'bad breath' and 'tooth decay' and thus
provides the ring of safety or protection and it is on this perspective Mr.
Desai contended that since the principal grievance pertains to the th{ee
broad-heads as above and the ring cannot but be termed to be an incidental
B· issue on which, the order of injunction is wholly unwarranted.

Mr. Desai, in support of the appeal further contended that the allegations
of unfair and restrictive trade practices is rather a serious allegation of
misconduct as regards the trade and there ought to be specific pleading in
F the complaint as also in the noti"e of inquiry together with full particulars
thereof and in the absence of which, question of any credence thereto does
not arise, for less the grant of an order of injunction as has been granted by
, , the Commission and impugned in this appeal.

In order however, to assess the substance of the point in issue as raised
G by Mr. Desai, a look at Section 36A may be convenient at this juncture.
Section 36A defines "unfair trade practice" as a trade practice which for the
purpose of promoting the sale, use or supply of any goods or for provision
of any services, adopts any unfair method or unfair or deceptive practice as
mentioned in t~e Section and thereby causes loss or injury to the consumer
of such goods or services, whether by eliminating or restricting competition
H or otherwise and in this context specific reference may be made to specific
CO LG ATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 579

sub-Sections appended thereunder which are of some relevance and as such A
noted herein below:-

(i) "falsely represents that the goods are of a particular standard,
quality, [quantity] grade, composition, style or model;

(it) falsely represents that the services are of a particular standard, B
quality or grade;

(v) represents that the seller or the supplier has a sponsorship or
approval or affiliation which such seller or supplier does not
have;
c
(vi) makes a false or misleading representation concerning the need
for, or the usefulness of, any goods or services;

(vii) gives to the public any warranty or guarantee of the performance,
efficacy or length of life of a product or of any goods that is not
based on an adequate or proper test thereof; D
Provided that where a defence is raised to the effect that such
warranty or guarantee is based on adequate or proper test, the burden
of proof of such defence shall lie on the person raising such defence;

(viii) makes to the public a representation in a form that purports to E
be -
(i) a warranty or guarantee of a product or of any goods or
services; or
(ii) a promise to replace, maintain or repair an article or any part
thereof or to repeat or continue a service until it has achieved F
a specified result,

if such purported warranty or guarantee or promise is materially
misleading or there is no reasonable prospect that such warranty,
guarantee or promise will be carried out;
G
(ix) gives false or misleading facts disparaging the goods, services
or trade of another person."

It is in this context however that the observations of this Court in
Lakhanpal's case Lakhanpal National Ltd. v. MRTPC, [1989] 3 SCC 251 is
rather apposite. This Court in paragraph 7 of the report observed: H·
580 SUPREME COURT REPORTS [1999] SUPP. 1 S.C.R.

A "7. However, the question in controversy has to be answered by
· construing the relevant provisions of the Act. The definition of "unfair ·
.7
trade practice" in Section 36-A mentioned above is no inclusive or
flexible, but specific and limited in its contents. The object is to bring
honesty and truth in the relationship between the manufacturer and
the consumer. When a problem arises as to whether a particular act
B can be condemned as aq unfair trade practice or not, the key to the
solution would be to examine whether it contains a false statement
and is misleading and further what is the effect of such a representation
made by the manufacturer on the common man? Does it lead a
reason.able person in the position of a buyer to a wrong conclusion?
c The issue cannot be resolved by merely examining whether the
representation is correct or incorrect in the literal sense. A
representation containing a statement apparently correct in the
technical sense may have the effect of misleading the buyer by using
tricky language. Similarly a statement, which may be inaccurate in the
technical ·literal sense can convey the truth and sometimes more
D effectively than a literally correct statement. It is, therefore, necessary
to examine whether the representation, complained of, contains the
element of misleading the buyer. Does a reasonable man on reading )
the advertisement form a belief different from what the truth is? The
position will have to view.ed with objectivity, in an impersonal rrianner.
E It is stated in Halsbury's Laws of England (4th edn., paragraphs 1044
and I 045) that a representation will be deemed to be false if it is false ..
in substance and in fact; and the test by which the representation is
to be judged is to see whether th~ discrepancy between the fact as
represented and the actual fact is such as would be considered material
by a reasonable representee. "Another way of stating the rule is to
F say that substantial falsity is, on the one hand, necessary, and, on the
other, adequate, to establish a misrepresentation" and "that where the
entire representation is a faithful picture or transcript of the essential
facts, no falsity is established , even though there may have been any
number of inaccuracies in unimportant details. Conversely, if the general
G impression conveyed is false, the most punctilious and· scrupulous
accu~acy in immaterial minutiae will not render the representation
true". Let us examine the relevant facts of this case in this background."

Similar is the finding of this Court.that "for holding a trade practice to
be unfair trade practice, therefore, it must be found that it causes loss or
.H irijury to the cor1Sumer" (emphasis supplied) HMM Ltd. v. Monopolies &
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 581

Restrictive Trade Practices Commission, [ 1998] 6 Supreme Court Cases 485 A
at490.

In the instant matter there are no allegations in the complaint against
the tenn "Suraksha Chakra" nor even an allegation that the same is misleading
or an unfair trade practice. The notice of inquiry also does not contain any
reference to "Suraksha Chakra" as unfair trade practice or there being any B
involvement or any falsity or in any way the same tantamounts to a misleading
infonnation to the people at large. The allegations in the complaint filed by
Hindustan Lever stand restricted or confined to Colgate's claim in respect of
'germ fighting', 'bad breath' and 'toothdecay'.

On the factual analyses as above, would we be justified in ascribing the
c
grant of the order of injunction by the Commission that the same is in
accordance with the known principles of law and the factors which ought to
weigh with the court in the matter of grant of injunction as indicated above
- the answer obviously cannot possibly be in the affirmative. The rigours of
American Cynamid and subsequent modulations thereof by the other English D
decisions along with the observations of Laddie, J. (supra) do not in any
event run counter the observations as above. The decision of this Court in
Antox India cannot but lend concurrence to the view expressed above to the
effect that the object of interlocutory injunction is to protect the plaintiff
against the injury by reason of violation of his right and relief by way of E
interlocutory injunction is granted to mitigate the risk of injustice to the
plaintiff during the period before the uncertainty could be resolved - three
specific features available in the complaint have not in any way been disturbed
by reason of lack of evidence but an incidental issue wholly dependent upon
those three specific features has been taken up for consideration and an order
of injunction granted. This is where the Commission is in error. The vindication F
of public right or public injury as contended by Mr. Salve does not, however,
make a dent in the contextual facts, since the case with which a party comes
to court ought to be considered in all fairness, in its proper perspective but
a
unfortunately -there is total lack of the same in the instant matter.

In any event, a distinction shall always have to be made and a latitude G
is allowed in the event of there being an advertisement to gain a purchaser
or two. The latitude spoken of, however, cannot and does not mean any
misrepresentation but by a description of permissible assertion. In this context
a passage from Anson's Law of Contract, (27th Edn.) may be of some relevance
and the same is quoted herein below:- H
582 SUPREME COURT REPORTS [1999] SUPP. I S.C.R.

A "Commendatory expressions, such as advertisements to the effect
that a certain brand of beer 'refreshes the parts that other beers
cannot reach', or that an after-shave lotion is irresistibly attractive to
the opposite sex, are not dealt with as serious representations of fact.
A similar latitude is allowed in private contracts to a man who wants
to gain a purchaser, though it must be admitted that the borderline of
B pennissible assertion is not always easily discernible. At a sale by
auction, land was stated to be 'fertile and improvable'; it was in fact
partly abandoned and useless. This was held to be a mere flourishing
description by an auctioneer' Dimmock v. Hallett, (1866), LR 2, Ch.
App. 21 ]. But where in a sale of a hotel the property was said to be
c let to 'a most desirable tenant', whereas his rent could only be obtained
under pressure and was currently much in arrear, such a statement
was held to entitle the purchaser to rescind the contract. Smith v.
land and House Property Corporation, (1884) 28 Ch. D.7

Further, assuming there was in fact an express warranty but that By
D itself would not necessarily result from a 'simple commendation of the quality
of goods by the seller': For in this case the rule of civil law, 'simplex
commendatio non obligat' - simple commendation can only be regarded as a
mere invitation to customer without any obligation as regards the quality of
goods: Every seller will naturally try and affirm that his wares are otherwise
E good to be purchased unless of course the same appears to be on evidence
that the commendation was intended to be a warranty. The popular English
saying 'in a purchase without warranty, one's eyes, tastes and senses must
be his protector' has its definite connotation and its application in matters of
the nature as the present one.

F On this score Mr. Desai contended that when there is an advertisement
and the same is said to have constituted an unfair trade practice, the
Commission has to examine the advertisement as a whole and assess its
impact on the users and viewers. An advertiser is pepnitted to indulge in
some amount of exaggeration or hyperbole since an advertisement is not an
G affldavit and as such question of going into the same to its 'letter' does not
arise and it is on this context, strong reliance was placed on the decision of
this Court in the case of Tata Press v. M T.N.L., [1995] 5 SCC 139 in which
this Court held that commercial speech is a part of the freedom of speech and
expression of guarantee under Article 19(1)(a) of the Constitution. We do not
however, think it fit to express any opinion in regard thereto since the matter
H does not warrant such a detailed discussion on this aspect of the matter at
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 583

this stage. A
The other aspect of the matter on which strong reliance was placed by
Mr. Desai is the delay involved in the matter. Admittedly "Suraksha Chakra"
featured continuously in the appellant's advertisement since the year 1985
without any demur or protest from any quarter and not even from the
complainant. As noticed above on the factual score that the complaint was B
filed as late as on 22.10.1997 immediately after the appellant's complaint
against the advertisement in respect of 'New Pepsodent' and it is on this
score that Mr. Desai contended that the finding of the Commission as regards
"Suraksha Chakra" or the grant of an interim order of injunction in regard
thereto does not and cannot arise. Mr. Desai ascribed this move of the C
respondent herein as nothing but a counter blast and we do find some
justification in regard thereto. The Commission according to Mr. Desai was
in clear error when it recorded that "Suraksha Chakra" was assailed first
before the Commission. Mr. Desai contended that "Suraksha Chakra" was not
at all an independent complaint and at least cannot but be ascribed to be
merely an incidental one by reason of the three specific complaints as noticed D
above. Mr. Desai contended that the Commission as a matter of fact was
persuaded to issue interim order pertaining to "Suraksha Chakra" by reason
of the factum of an order of injunction granted by the Federal Trade Commission
in the United States of America wherein a complaint was made in respect of
Colgate Dental Cream with Gardol in November 1959 in the United States. In E
the U.S. advertisement incidentally, there was an invisible shield protecting
the tooth. But in the facts of the matter under consideration, there is no such
protection as was offered in the United States but it is the resultant effect of
the foaming action which stops bad breath and toothdecay and the entire
family would be safe so far as toothdecay is concerned. 'Suraksha' has a
meaning in common acceptation and implies safety and 'Chakra' mean a wheel F
or a disc and the words put together as 'Suraksha Chakra' cannot be equated
or be understood to mean an invisible shield which would protect the tooth
as was available in the U.S. advertisement. In this context it would be pertinent
to note the observations of the Commission pertaining to its order of the
grant of injunction. The Commission stated: G

"In the complaint the respondent's parent company in USA was
alleged to have made fati:;e, misleading and deceptive representations
in advertising CDC with Gardol. The print and television advertisements
gave the impression to the prospective purchasers of CDC with Gardol
that persons who brush their teeth with that toothpaste would prevent ,H
584 SUPREME COURT REPORTS [1999] S.UPP. l S.C.R.

A decay from getting to their teeth as an invisible protective shield
• around the teeth is formed by CDC with Gardol. The TV advertisement
depicted a coconut, tennis. ball and lariat being thrown towards a
. person but, the coconut, tennis ball and lariat bounce off and do not
reach the person at whom they are thrown because of an invisible
transparent glass shield as also in no way damaged or penetrated. The
B advertisement of invisible shield and representation as to the degree
or extent of protection was found to be false, misleading and deceptive
by the FTC and an order was passed directing the respondent's
parent company to cease and desist from representing directly or by
implication that CDC with Gardol afforded to users complete protection
c against tooth decay or development of cavities in their teeth. It was
also brought to our notice that although the respondent had voluntarily
abandoned the impugned advertisements and TV commercials during
the course of hearing before FTC and gave an undertaking not to
display the advertisement, containing the objectionable claim of
invisible protective shield, the above cease and desist order was
D passed because the assurance given by the respondent's parent
company, was not considered sufficient for ruling out the likelihood
of resumption of the impugned advertisements and unfair trade practice
in some other form. It was also pointed out that since no appeal was
filed, this order of FTC had become final."
E
Let us now however consider the observations of the Commission
itself which runs to this effect: "falsity or otherwise of these claims can be
established conclusively at the stage of trial when evidence will be adduced
by the informant/complainant by examining experts and their cross examination
by the respondent. Due weight and consideration has to be given to the
F opinions of experts while appreciating and evaluating evidence in order to
arrive at a just conclusion and this can be done at the final stage of the
enquiry." In our view the observation or expression of opinion as above, as
a matter of fact, runs counter to an order of injunction as has been granted
by the Commission. Obviously the commission was persuaded to pass the
G order of injunction pertaining to "Suraksha Chakra" as and by way of an
interlocutory order by reason of the factum of the injunction as granted by
the Federal Trade Commission in the United States of America and we have
already noticed earlier that in the advertisement under controversy no invisible
shield to protect the tooth is available. It is the complainant's definite case
that the advertisement pertaining to the foaming action, stopping bad breath
H and tooth decay cannot but be said to be a misrepresentation of facts and
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J .] 585

as such ought not to be pennitted to be continued with such an advertisement A
and it is in this perspective as a matter of fact the complainant records in the
complaint:

"The Complainant carried out in their Research Centre well accepted
test to study the anti-bacterial efficacy, if any, of the CDC. The B
Executive Summary of the test shows that:-

Contact Germ Kill test (Ref. - Spangler S.K. Jacobs MR, and Applebaum
PC, J of Antimicro Chemo Therapy 39 (suppl 8) p. 23, 1997).

"The test data shows that Colgate Dental Cream has no significant C
impact on the survival rate of oral bacterial during the contact of

.. 60 seconds which is more than the average brushing time of
consumers. The same test done for toothpaste will standard anti-
bacterial agent shows a significant drop in the survival rate of these
bacteria under similar conditions". The Complainant craves leave to
refer to and rely upon the detailed report, enclosed as Annexure 6. D

The analytical report clearly establishes that Colgate Dental Cream

.. has no proven anti-bacterial ingredient nor dies it have any
significant anti- bacterial activity or effect. The claim made in the
advertising are not proved and/or substantiated scientifically/ E
technically and are thus false and misleading.

In India the ability of a toothpaste to protect against h~rmful oral
genns is a very compelling consumer benefit. A national survey of
consumers done by the complainant/informant in 1994 showed that
55% of all consumers see 'ability to fight germs' as the most important F
attribute of a toothpaste. In fact, germ protection is a strong source
of competitive advantage in the market. As such, any claim in this
area, must be backed by proven efficacy of the product to combat the
threat of harmful oral bacteria.
G
The Respondent is thus making advertising claims on Colgate Dental
Cream· for promoting sale of Colgate Dental Cream that are misleading
and false, to gain unfair advantage in the market place to the extent
of monopolising The toothpaste market, beyond the intrinsic quality
of the product. The Respondent has also been making the claim of
'fights toothdecay' for promoting sale of Colgate Dental Cream. This H··
586 SUPREME COURT REPORTS (1999) SUPP. 1 S.C.R.

A claim again is false and absolutely misleading. It is a scientifically
established fact that the well known agent that can fight "toothdecay"
is Fluoride. More than I 00 long tenn clinicalls have been carried out
to show in unequivocal tenns that fluoride is capable of reducing
toothde~ay. The complainant enclose a summary of literature on

B toothdecay and the role of fluoride in reducing the same in support
of the fact that presence of. 'fluoride' can help in reducing tooth
decay. (Annexure 8 (Colly).

The Complainant/informant submits that Colgate Dental Cream does
not have soluble fluoride. The fact that Colgate Dental Cream does
c not have soluble fluoride can be ascertained from the pack of Colgate
Dental Cream (copy CDC pack photocopy is enclosed as Annexure 9).

The Complainant further submits that even the claim of "Stops Bad
Breath" is false and misleading, as bad breath is the result of action
of oral bacteria that act on proteins present in saliva or food particles
D
giving Volatile Sulphur Compounds (VSC) like hydrogen sulphide and
Indoles. These compounds are volatile and are currently considered
as root cause of bad breath. Process of generation of VSCs is well
reported (Steenberghe van D and Rosenberg M (ed.), Lueven University
Press 1995).
E
The Respondent has also published a report (Niles H.P., J dent. Res.73
sp.issue, Abst. No.1579) demonstrating that reduction in VSCs can be
achieved by using triclosan in the toothpaste. A placebo (without
triclosan) showed no effect over and above the negative control.
F Demonstration of reduction in VSC is pre-requisite for making claims
on bad breath. It is, therefore, clear that Colgate Dental Cream which
does not contain triclosan, can not supress the bad breath leave
alone "stops" it." (Emphasis supplied)

The averments as above unmistakably therefore, depict that it is on the
G basis of laboratory tests that the complainant has found that representation
is not correct and it is on this perspective that Mr. Desai also contended that
the entire grievance of the complainant has to be decided on the basis of the
evidence at the time of the trial but not at any stage prior thereto. As a matter
of fact the Commission itself, as noted above, has recorded such a finding,
H but after recording the same, came to find about 'Suraksha Chakra' and we
\
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 587

find some justification in Mr. Desai's criticism as regards the non application A
of mind in the matter of passing of an order of injunction as impugned in this
appeal. On a perusal of the complaint 'Suraksha Chakra' cannot be said to
be within ambit of the foaming action and has been referred therein only to
complete the advertisement portion as an incidental issue and obviously the
Commission was persuaded more by the U.S.Trade Commission's Report
rather than consideration of the allegations in the complaint itself. B

. Mr. Salve appearing for the Respondent/Complainant strongly contended
that by using 'Suraksha Chakra' in the commercial advertisement specially in
Hindi, the appellant has, in fact, targeted the ordinary common man in the
Hindi belt so as to give an expression that the toothpaste as matter of fact C
provides a durable and permanent protection with respect to germs, toothdecay
and bad breath to the entire family and "Suraksha Chakra" depicts the same.
Mr. Salve contended that at this stage, question of there being any definite
finding on any of the issues would not arise since only an arguable case is
required to be made out at this juncture. Probably an arguable case leading
to the establishment of the prima facie case is required - we have dealt with D
this issue in the early part of this judgment and as such we need not detain
ourselves on this score but the fact remains that question of the balance of
convenience of the parties have not been dealt with or discussed in the order
of the Commission. Mr. Salve in continuation of his submission contended
that there is, in fact, a cross appeal by the Complainant by reason of the E
failure of the commission to pass orders as regards the three limbs of the
advertisement namely 'germ fighting', 'toothdecay' and 'bad breath' and the
fact however remains that the Commission was otherwise satisfied that this
cannot but be termed to be a case similar in nature as was heard by the
Federal Trade Commission wherein the invisible shield was taken recourse to
by the appellants. Mr. Salve contended that at least there would be an F
arguable case by reason of the order of FTC and as such question of
interference in Appeal by this Court in terms of provisions of Section 55 does
not arise more so by reason of the fact that the Commission has not returned
any finding as regards the three principal issues but passed an order of
injunction only as regards the 'Suraksha Chakra' by reason of the specific G
order of the FTC as noticed above.

The submission of Mr. Salve at the first blush is rather attractive that
at this stage we are not really concerned with the factum of establishment of
any truth or falsity but merely a prima facie case or an arguable case resulting
in establishment of a prima facie case and in that perspective the issue H
I"''

588 SUPREME COURT REPORTS [1999) SUPP. 1 S.C.R.

A therefore emerges as to whether such a prima facie case has been made out
or not - we are however afraid that the answer cannot but be the negative.
The Federal Trade Commission was confronted with an invisible shield which
was protecting the tooth from a coconut, tennis ball and a piece of stone and
it is on this factual back-drop that FTC came to a conclusion that withstanding
B of the pressure of the coconut or resistance by an invisible shield by reason
of the user of the toothpaste would not arise. The situation in the present
context is however totally dissimilar. No material object is bouncing back after
hitting the tooth by reason of "Suraksha Chakra". "Suraksha Chakra" comes
up by reason of the factum of fighting of germs, tooth decay and bad breath
- it has not been proved or even enquired as to whether the Colgate Dental
C Cream can avoid decay or germs or whether it does or does not· stop bad .
breath - It is only against these three items that there is 'Suraksha' by means
of a 'Chakra'. There is no claim that the toothpaste would act as a shield
against any hard substance which may or may not tantamount to misleading
the common unwary purchaser in the clampham omnibus: This "Suraksha
Chakra" refers two basic elements, namely 'toothdecay' and 'germ fighting'
D coupled with stopping of bad breath. It does not as a matter of fact require
any special knowledge to appreciate or understand as to the effect of the
"Suraksha Chakra". No evidence has been led as to whether there would be
avoidance of 'tooth decay' or ·germ fighting' by reason of the user of the

E
toothpaste and without rendering evidence on these two basic elements in
our view, question of there being a prima facie case for establishment for the
--
grant of interlocutory injunction does not and cannot arise. The Commission,
as appears, was totally obsessed with the FTC's finding in regard to the
invisible shield without however any factual support in the matter under
consideration. The Commission it seems in fact, misapplied arid misread the
observations of Federal Trade Commission since there is no factual similarity
F between the two. Prima facie case or at least arguable case does not and
cannot possibly suggest an order of injunction without any factual support.
There ought to be some such support on facts without which there would not
be any justification for grant of an interim order.

Mr. Salve next contended that the complaint pertains to vindication of
G a public right and since the public interest is involved, question of any delay
for moving the Commission does not arise and more so, it is a remedy to
public wrong and not being a personal relief. We are, however, unable to
-·
record. our concurrence at this juncture. Public wrong, if any, needs to be
assessed and proved, without which question of having an order of injunction
H would not ~rise. While it is true that the relief prayed for is statutory in nature
COLGATE PALMOLIVE (INDIA) LTD. v. HINDUSTAN LEVER LTD. [BANERJEE, J.] 589

but that does not clothe the Commission to pass orders de hors the basic A
principles of law.

In fine, the submission of Mr. Desai as regards the bona fides of the
application under Section 12A cannot also be brushed aside and in our view
non consideration thereof by the Commission has resulted ih a clear error on
the part of the Commission. The fact that within a period of l 0 days of the B
application by the appellant herein before the Commission, the Respondent
files the instant complaint with an application for an interim prayer - though,

- however, this "Suraksha Chakra" admittedly is available in the commercial
advertisement since 1985 and in the visual advertisement in Hindi at least
since 1987- there was no lodgment of any protest or complaint in public
interest but it only filed as a back lash on the appellant's complaint as noticed
C

above and the motive therein in our view cannot also be ruled out.

The appeal preferred by the complainant as against the failure of the
Commission to pass orders on the other three elements of the advertisement
in our view at this stage cannot be entertained and we record our concurrence D ,
with the finding of the Commission that without going through the evidence,
it is neither feasible not proper in any event to pass any orders thereon at
this juncture. We are dismayed however by the fact that after recording a
finding on that score as noticed above, the Commission passed an order of
injunction in regard to an issue without however any material on record. E
As a matter of fact there is no evidence of a single consumer being
misled an.d not a whisper as to what constitute an unfair trade practice
pertaining to "Suraksha Chakra". Th~ Commission also thought it fit not to
record any reason or justification for the grant of an interim order of injunction
in spite of finding as above and before the matter is investigated and complaint F
is finally heard. This apart, the factum of non-availability of any explanation
of more than 13 years delay has also riot been delved into by the Commission
at all.

In that view of the matter question of there being any order of injunction G
at this stage of the proceeding on the face of the finding as passed by the
Commission itself does not and cannot arise. The Appeal No.2620 of 1998
Colgate Palmolive {India) Ltd v. Hindustan Lever Ltd, therefore succeeds:
The. Appeal as filed by the complainant being No. 3288 of 1998 Hindustan
Lever Ltd. v. Colgate Palmolive (India) Ltd, stands dismissed. Each party
to bear its own cost. H
590 SUPREME COURT REPORTS (1999) SUPP. l S.C.R.

A Be it recorded that any observation made in this order shall not in any
way effect the hearing of the matter before the Commission and the Commission
would be at liberty to deal with the matter in accordance with the law and
without being inhibited by any observations made in this order.

RKS. Appeal allowed;

.i