Co-owners Inderjit Singh Nagpal and Manmeed Singh Bhatia had put up the "Singhbury's Local" sign on their store in Aylesbury, Buckinghamshire, last February.
The lettering and colour were very similar to Sainsbury's Local signs across the UK.
"The first part of the name is Singh, for our names, and the second is bury for Aylesbury. We used the colour orange because that is the colour of our Sikh religion," claimed Nagpal.
After pictures of the store began circulating on social media, they were contacted by Sainsbury's to take down the sign.
The Singhs' store has been without a sign since October last year.
The co-owners say that while they are willing to change the colour of any new sign, they have full justification to hold on to the name.
A decision between their legal representative and Sainsbury's is expected later this month.
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