2012 (6) TMI 672 - HC - Companies Law

Dispute about the name of the company - petition against the order directing the petitioner, registered as a company in the name of M/s International Trade and Exhibitions India Private Limited to change its name - name which is identical with or too nearly resembles - Powers under Section 22 of the Companies Act - Rectification of Name of company - full form of the abbreviation ITE in the name of the respondent no. 2 was also International Trade and Exhibitions and further since both respondent no. 2 and the petitioner were in the same business of Events Held that - the test provided in the guidelines under Section 20 could not have been applied to a rectification proceedings under Section 22 when the Legislature has not deemed it appropriate to provide for rectification of undesirable names other than those covered by Section 20(2). The remedy against undesirable names falling in any category other than Section 20(2) is not under Section 22 but would be before the Civil Court Legislature in its wisdom has confined power of Central Government to registered names and marks only and did not extend inquiry into identical with and resemblance with unregistered names and marks Respondent no. 2 is unregistered company - power of rectification in section 22 is limited to form an opinion as to identical with and resemblance with registered names and marks only - It thus cannot be said that any case for exercising of powers for rectification under Section 22 was made out. I am unable to find any identity or resemblance between ITE or ITE India and International Trade and Exhibitions . The alphabets IT and ITE are today identified more as Information Technology and Information Technology Enabled than with International Trade and Exhibitions . It thus cannot be said that any case for exercising of powers for rectification under Section 22 was made out. Petition succeeds and is allowed

Issues Involved:
1. Validity of the order directing the petitioner to change its name under Section 22 of the Companies Act, 1956.
2. Interpretation of Section 22 of the Companies Act, 1956.
3. Applicability of the Department's Guidelines for availability of names.
4. Distinction between registered and unregistered names and trademarks.

Issue-wise Detailed Analysis:

1. Validity of the order directing the petitioner to change its name under Section 22 of the Companies Act, 1956:
The petition challenges the order dated 21st January 2011 by the Regional Director, Northern Region, Ministry of Corporate Affairs, directing the petitioner to change its name "International Trade and Exhibitions India Private Limited" within three months. The order was made in response to an application by respondent no. 2, who claimed that the petitioner's name was identical to or resembled their registered and well-established trademarks "ITE India" and "ITE."

2. Interpretation of Section 22 of the Companies Act, 1956:
The court emphasized that Section 22 of the Companies Act, 1956, provides for the rectification of a company's name if it is "identical with or too nearly resembles" a previously registered name or a registered trademark. The court noted that the legislative intent was to limit the scope of Section 22 to registered names and trademarks only. The court clarified that the Central Government's power under Section 22 does not extend to unregistered names or trademarks, even if they are in use.

3. Applicability of the Department's Guidelines for availability of names:
The court examined the Department's Guidelines for availability of names, which suggest that names resembling popular or abbreviated descriptions of important companies should not be adopted, even if unregistered. However, the court held that these guidelines apply to the initial registration of company names under Section 20 of the Act, not to rectification proceedings under Section 22. The court emphasized that Section 22's scope is narrower and only concerns registered names and trademarks.

4. Distinction between registered and unregistered names and trademarks:
The court highlighted that the respondent no. 2's claim was based on the use of the words "International Trade and Exhibitions" in conjunction with their registered name and trademarks. However, these words were not part of the registered name or trademarks. The court concluded that Section 22 does not permit rectification based on names or trademarks that are in use but not registered. The court further noted that disputes involving unregistered names and trademarks typically require detailed investigation, which is beyond the Central Government's competence under Section 22.

Conclusion:
The court set aside the order dated 21st January 2011 of the Regional Director, holding that the order was not sustainable under Section 22 of the Companies Act, 1956. The court reiterated that the power of rectification under Section 22 is confined to registered names and trademarks and does not extend to unregistered names or marks. The petition was allowed, and no order as to costs was made.

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