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TMI Blog1996 (5) TMI 409X X X X Extracts X X X X X X X X Extracts X X X X ..... ot 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. - C.A. 8266 OF 1996 - - - Dated:- 10-5-1996 - K. RAMASWAMY, FAIZAN UDDIN AND G.B. PATTANAIK, JJ. JUDGMENT Leave granted. We have heard learned counsel on both sides. The admitted facts are that the respondents through their agents had registered trade mark "Raleigh" and other trade marks (12 marks) under the Indian Merchandise Marks Act, 1889 (4 of 1989) and the Trade Marks Act, 1940 (5 of 1940). The Trade and Merchandise Marks Act, 1958 (43 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re filing that rectification application. A continuous period of 5 years or longer had passed and the trade mark had not been bona fide used by the respondent. Having regard to the extended nature of non-user of the concerned trade mark after November 1, 1976, any further use of the said trade marks by the respondents was likely to deceive and cause confusion to the trade and public alike in India etc. Simultaneously, an application for registration of three trade marks An their favour was filed by the appellant on March 25, 1982. By proceedings dated June 13, 1984, the Registrar of Trade Marks informed the appellant that the registered user's applications were abandoned since the appellant failed to comply with the statutory requirements. The learned single Judge dismissed the application by his judgment dated September 13, 1990 holding, inter alia, that any proprietor mentioned in Section 46(1)(b) of the Act extends to bona fide user other than registered users. Special circumstances as a defense were available to the respondent for non-user; even after 1979, the supply-technical know-how by the respondent was not totally absent. After termination of the collaboration and user ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s agent Sen Raleigh as Permitted user" for a period of 5 years immediately preceding the date of the application under Section 46 for removal of the trade mark from the Register, there was no bona fide user thereof in relation to those goods by the proprietor himself. The respondents admittedly did not use the same. The appellant cannot be said to be either the proprietor of the trade mark since 1976, since the agreement lapsed or permitted user-. The High Court therefore was wrong in holding that 5 years' period had not lapsed. The harmonious construction should be put up in such a way that Section 48(2) and Section 466 by of the Act could be permitted to have their- full play in their operational structure. The construction put up by the High Court renders sub-section (2) of Section 48 otiose or surplusage which interpretation is impermissible. It is contended that the registered user must be understood to be the user by the proprietor or authorised user registered under Section 48. The period of 5 years should be computed from that date of expiry of registered user. The Division Bench,therefore, was wrong in its conclusion that the appellant has failed to establish it. On the ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of the trade mark and passes off the goods in the market manufactured by the appellant, is construed to be a bona fide user for and on behalf of the registered proprietor, namely, the respondents. Admitted position is that the respondent being the registered proprietor, until it is proved that its trade mark was not used to pass off the goods manufactured by the appellant and that the appellant had discontinued the user and 5 years lapsed thereafter, the non-use of the trade mark continues thereafter, the rectification application under Section 46 (l)(b) would be ordered. In view of the prohibition to import bicycles, the respondent was prevented to use the trade mark but by collaboration agreement, it was continuing to use the trade mark by the permitted user. The special circumstance is that the appellant filed an application for registration under section 48(1) and continued it till it was abandoned. It would also be considered as a special circumstance for non user. The discretion exercised by the Court must be judged in the light of the facts and circumstances, The appellant having used the trade mark, it does not lie in the mouth of the appellant to contend that he is not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of making application for rectification for a continuous period of 5 years or longer if registered trade mark had not been use during that period, there was no bona fide user in relation to those goods by the proprietor thereof for the time being. The trade mark should be taken off and struck out form the register of trade marks in respect of any goods in respect of which the trade mark is registered . Sub-section (3) enables the registered proprietor to show special circumstances for the non use of the trade mark due to which circumstances in the trade, he could not use the trade mark for the above period and not with any intention to abandon the use of trade mark or not to use the trade mark in relation to good to which the application for rectification relates. Sub-section (2) of Section 48 give defence to "permitted user" in relation to a registered trade mark. It means the use of the trade mark by a registered user of the trade mark in relation to good with which he is connected in the course of trade and in respect of which the trade mark remains registered for the time being and for which he is registered as a registered user and which complies with any conditions or restri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use it as a commodity would be trafficking in that trade mark. It requires to be prevented and prohibited. The Court would not lend assistance to such registered proprietors of the trade mark. There must be real trade connection between the proprietor of the trade and licensee of the goods and the intention to use the trade mark must exist at the date of the application for registration of trade mark and such intention must be genuine and bona fide and continue to subsist in order to disprove the charge of trafficking in trade mark. It is a question of fact in every case. The question is: whether the trade connection exists to dispel the charge of trafficking in the trade mark? This question was considered by this Court in American Home Products Corporation vs. Mac Laboratories Pvt Ltd Anr [(1986) 1 SCC 465 in paragraphs 38 and 39] and they need no reiteration. It is seen that preceding the nationalization of the Cycle manufacturing industry under the IDR Act, the respondent had a collaboration agreement with Sen Raliegh who was a registered user under Section 48. From him, the appellant came to succeed by statutory operation. It was, therefore, not a case of getting the trade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ima facie shows non-user for the relevant period. Then the burden shifts to the proprietor of the trade mark to affirmatively prove the special Circumstances for non-user of trade mark. It must be shown that the non-use of the trade mark is due to special circumstances of the trade and not due to some other Cause which would have operated, whether the special Circumstances had arisen off not. Although the special circumstances of trade taken by themselves would have prevented the use of the trade mark. If the non-user was, in fact, due to some other circumstances and would have occured whether the circumstances had followed or not, subsection (3) would not apply. It must, therefore, be duty of the registered proprietor to show What non-user was strictly due to the special circumstances of trade and not of any intention on the part of the registered proprietor not to use the trade mark during the relevant period. Though there was a ban on impart of the Raleigh cycles manufactured outside India and passed off under the registered mark of the respondents as a registered proprietor, the circumstances do not attracted sub-section (3) of Section 46 to relieve the respondents to establi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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