Use of Trademark after end of contractual terms
we entered into contractual terms with a master franchise, ABC is an German company having presence worldwide and they have given master franchise to XYZ company in India. this XYZ company gives franchise in India. we took franchise of XYZ company and were operating the business under their guidelines. but later on we found that this XYZ company was cheating on us. Said they were giving us A material and were sending B material, Charged us 300% more price for the same product which is available in market for 300% less price. We still continued the business in usual manner with them. later on when our contract ended with them we did not renew the agreement with them and continued using their brand name, as they denied us service during our agreement term. Other disputes were also raised during the end of term but that remained unresolved. Later on one fine day I got a call from my local police station that XYZ has made a complaint against you.
My question is
1) is it a criminal offence of using trademark even after contract terms ended?
2) Can local police constable call me up in this case and investigate the matter?
3) when the matter is disputed can I have the prejudice of using the brand name?
4) Agreement states that extension of agreement will be done on mutual understanding and either party have to agree and not breach agreement.
5) Franchise based model is considered as "tried and tested" method and the party has to go out and do the business and in our case they tried different products on us and eventually we had to loose clients, can we claim damages from them as we have in writing about product failures and loss of business due to poor quality products?
6) is it a civil case or a criminal case?
7) Can a master franchise issue or make complaint against the franchise? as per my knowledge even they are the user of the brand from the company and not owner of the brand. The company has got no direct presence in India and operate only through franchise based model.
What can be our safety in this case as we have invested heavily into the brand to build it in local area. And even after working hard if were to loose the use of brand name it is going to hurt us.
What can be our legal option in the case.