Recently, the Bombay High Court in a petition filed by Electonica India Ltd. against Electonica Hitech Machines Private Limited (respondent no 1) and others, found it appropriate and fit to remand back the matter to the Trademark Registry for them to reconsider it, having decided that the registry had failed to pass any reasoned order while allowing the trademark registration of respondent no. 1.
Justice RI Chagla while passing the order made it explicitly clear that the proceedings under Section 45 of the Trade Marks Act cannot be merely an administrative function particularly since the Sub-Section 2 of Section 45 of the Trade Marks Act read with Rule 77 of the Rules provides that the Registrar may require the applicant to furnish such proof of title over the concerned trademarks which the Registrar may require for his satisfaction.
Petitioner's Case
The Petitioner had raised a challenge to the purported orders of the Trademark Registry allowing the two Form TM-24 applications by respondent no. 1 for bringing on record their name as the subsequent proprietor from a Partnership Firm to a Limited Company.
The TM Registry has admittedly not passed any reasoned order while allowing the said applications. It was the petitioner's case that the TM Registry has failed to consider its objections raised in the letter dated January 19, 2018 to respondent no 1's request on Form TM-24 for recordal under Section 45 of the Trade Marks Act, 1999 nor does it provide any reasons for rejecting the objections of the petitioner.
According to the petitioner, their rights have been completely disregarded by the TM Registry in sheer violation of the principles of natural justice. Further, in the application under Form TM-24 a false affidavit was filed by respondent no. 1 after being called by the Trade Mark Registrar to disclose on affidavit all and any pending disputes pertaining to the mark "Electronica".
Moreover, the petitioner averred that they had in fact already challenged Respondent No. 1's exclusive claim to the subject mark. Had Respondent No. 1 disclosed the Pune Suit proceeding in the said Affidavit, the TM Registry would have followed the mandate laid down in Section 45(3) of the Act and not decided on the application until the time the rights in the subject mark were decided by the competent Court. Irrespective of the outcome, the TM Registry ought to have passed a reasoned order in the said proceedings, the petitioner's argued
Respondent No.1's Defense
Counsel for the Respondent No.1 on the other hand in principle made the following submissions,
- His client cannot be made to suffer due to any acts done/not done by the TM Registry with respect to the order dated January 25, 2018. In the event the matter is sent back to the Registrar for fresh consideration under Section 45, grave prejudice and irreparable loss will be caused to his client as the registration of trademark would exist in a vacuum. According to the respondent no.1, no document is required for conversion of a partnership to a company as in the present case, the subject trademark "Electronica" was registered in the name of the partnership firm M/s. Electronica from 2004 both under Class 7 and Class 9 of the Trade Marks Act and the subject mark had thereafter automatically vested in respondent no. 1 Company upon the firm's conversion to part IX Company under the Companies Act which would amount to transmission.
- When an application is made under the provisions of Section 45 of the Trade Marks Act before the TM Registrar, no other document of title is required to be considered to register in the name of Respondent No. 1 in place of the partnership firm.
- According to the respondent no.1, the TM Registrar was only required in the present case to replace the name of respondent no. 1 company in place of partnership firm as the registered proprietor of the trademark in accordance with the document of title being the certificate of incorporation of respondent no. 1.
Court's Decision
Relying upon Section 45 of the Trade Marks Act, particularly Sub Section 2, the Court was of the view that this provision requires the TM Registry upon a receipt of an application for either assignment or transmission to follow due process of law and in certain instances, require the applicant to furnish evidence in proof of title where there is a reasonable doubt about veracity of any statement or any document furnished. It is only upon such satisfaction that the Registrar may register the applicant as the proprietor of the trade mark in respect of the goods or services in respect of which the assignment or transmission has effect, and shall cause particulars of such assignment or transmission to be entered on the register.
Relying upon sub section 3 of Section 45, the court held that when the validity of an assignment or transmission is in dispute between the parties, the Registrar may refuse to register the assignment or transmission until the rights of the parties have been determined by a competent Court and in all other cases the Registrar shall dispose of the application within the prescribed period.
Further, Court also referred Section 91 of the Trade Marks Act to hold that he provisions of the Trade Marks Act, 1999 for registration of assignment and transmission contemplates adjudication of the applications made to the Registrar and passing of an order by the Registrar which is subject to Appeal to this Court. The court was overall of the view that relevant rules of the Trademarks Act provides for proper adjudication by the Respondent No. 2 which in its view has acted contrary to Section 45 of the Trade Marks Act in failing to consider the Objection Letter of the Petitioner. Accordingly, while allowing the petition, the Court remanded back the matter to be taken up afresh and pass reasoned orders.
Authors’ View
This Judgment clarifies the position as to irrespective of the outcome of the proceedings filed under section 45 of the Trademark Act, the TM Registry must hear the parties, take into account all relevant objections in support with the evidence and pass a reasoned order. Just because, the subject mark was already being used by the predecessor firm (subsequently to new formed Company), the TM Registry cannot proceed with registration/transmission of assignment in favour of the new Company, without hearing all relevant parties and passing reasoned order.
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