1996 (5) TMI 409 - SC - Companies Law

Whether the High Court was right in refusing to rectify and strike off the trade marks of the respondents from the register of trade marks? Held that - It is true that while exercising discretion, the Court under Section 46 of the Act should take into consideration not only commercial interest of the parties but also public interest The High Court refused to exercise the discretion to strike off the trade mark from the register. It is seen that the appellant had not abandoned, at any point of time, the use of the trade mark of the respondent-registered proprietor till filing of the application. Though the appellant has not used the trade mark by itself since 1954 and after the expiry of the permitted use by Sen Raleigh until the notice was issued by the respondent directing the appellant not to use the trade mark, the appellant came to use the same in passing off bicycles manufactured by it under trade mark of the respondent. It is not relevant for the purpose of Section 46(1)(b) whether the bicycles were manufactured with the assistance of technical know-how passed on by Sen Raleigh or the permitted user. Suffice it to state that the appellant, as a fact, had used the trade mark of the respondent in passing off the bicycles manufactured by it. The High Court, in our view, declined, for good reasons, to rectify the trade mark under Section Act b) of the Act. We are also not persuaded to take a different view from that of the High Court. In these circumstances, we are of the view that the High Court has properly exercised its discretion and refused to rectify and strike off the trade mark, from the register of trade marks of the Registrar. Appeal dismissed.

Summary

Issues Involved:
1. Non-use of the trade mark by the registered proprietor.
2. Bona fide use of the trade mark by the appellant.
3. Special circumstances justifying non-use of the trade mark.
4. Discretion of the court in rectifying the trade mark.

Detailed Analysis:

1. Non-use of the trade mark by the registered proprietor:
The appellant argued that the respondents had not used the trade mark "Raleigh" for a continuous period of five years preceding the application under Section 46 of the Trade and Merchandise Marks Act, 1958. The respondents had failed to provide technical assistance and the trade mark had not been bona fide used by the respondent or its registered user, Sen Raleigh, after November 1, 1976. The High Court found that the respondents had allowed the appellant to manufacture bicycles according to their specifications and to pass off the goods under their trade marks, thus maintaining a connection in the course of trade.

2. Bona fide use of the trade mark by the appellant:
The appellant contended that they were not a registered user of the trade mark after the agreement lapsed in 1976, and thus, the trade mark should be removed from the register. However, the High Court held that there was no specific bar for an unregistered licensee to use a registered trade mark as long as there was a connection in the course of trade between the licenser and the licensee. The court found that the appellant had used the trade mark bona fide in passing off bicycles manufactured by it under the trade mark of the respondent.

3. Special circumstances justifying non-use of the trade mark:
The respondents argued that the non-use of the trade mark was due to special circumstances, such as the prohibition on importing bicycles and the collaboration agreement with Sen Raleigh. The High Court noted that the appellant had filed an application for registration under Section 48(1) and continued it until it was abandoned, which could be considered a special circumstance for non-use. However, the court found that the respondents did not establish special circumstances for non-use under Section 46(3) and that the non-use was not due to any intention to abandon the trade mark.

4. Discretion of the court in rectifying the trade mark:
The High Court exercised its discretion under Section 46 of the Act and refused to rectify and strike off the trade mark from the register. The court considered both the commercial interests of the parties and public interest, noting that the appellant had not abandoned the use of the trade mark at any point and had continued to use it in passing off bicycles manufactured by it. The court found that the appellant had used the trade mark bona fide and that the respondents had not established special circumstances for non-use. Thus, the High Court properly exercised its discretion and refused to rectify the trade mark.

Conclusion:
The Supreme Court upheld the High Court's decision, dismissing the appeal and confirming that the High Court had properly exercised its discretion in refusing to rectify and strike off the trade mark from the register. The appeal was dismissed without costs.