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TMI Blog1990 (7) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... ions Act, 1971. The petitioner No. 2 are not a Company to which Part 'A' of Chapter III of the Monopolies and Restrictive Trade Practices Act, 1969 applies. The petitioner No. 1 are world renowned manufacturers of tooth paste, a variety of cosmetics and toilet preparations. The petitioner No. 1 Company are generally known as Colgate-Palmolive and the products are sold under various trade marks, word marks, label marks and as well as device marks which have been registered as trade marks in several countries of the world including India. The petitioner No. 1 company till the year 1949 were exporting to India Colgate Dental Cream, Palmolive soap and various other goods bearing their trade marks. The petitioner No. 1 when incorporated in the year 1937 was a wholly owned subsidiary of petitioner No. 1. From the year 1949 onwards, in deference to the policy of Government of India, petitioner No. 2 commenced manufacturing of Dental Cream, Shaving Cream and other cosmetics and toilet products in this country and for that purpose, petitioner No. 1 made available the know-how, information and data and techniques in respect of products to be manufactured. The products manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondence with the Government. The Registrar then informed the petitioner by notice dated May 19, 1981 that the Government of India proposes to refuse the applications for registration in respect of the remaining trade marks and the refusal was on the ground that it is not in the interest of general public and the development of indigenous industry in India, and the manufacture of brushes including tooth brushes was reserved for exclusive development in Small Scale Sector. The petitioners sent reply on September 29, 1981 claiming that the grounds supplied by the Government are totally vague and inadequate and registration cannot be declined. The Government of India then gave hearing to the petitioners and thereafter on December 17, 1982, the Registrar intimated to the petitioners the order, rejecting the registration of petitioner No. 2 as Registered User, in accordance with the directions given by the Government. The grounds communicated for rejection of applications are: 1. The trade marks for which petitioner No. 2 is sought to be registered as Registered User are foreign owned brand name and it is the general policy of the Government not to allow use of foreign owned bra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be contrary to the public interest, then the Registrar may register the proposed registered user as a registered user in respect of the goods as to which he is so satisfied. The statutory provision in respect of trade marks was first enacted in India in the year 1940 and S. 41 of the Trade Marks Act, 1940 provides for application for registration as Registered User. Sub-sec. (1) provides for application by the petitioner and the proposed registered user and the documents which are to be annexed to such application. Sub-sec. (2) of S. 41 of the Act provides that when the requirements of sub-sec. (1) are complied with and if the Registrar is satisfied that in all the circumstances the use of the trade mark by the proposed registered user would not be contrary to the public interest, then the Registrar may register the proposed registered user as a registered user in respect of the goods to which he is so satisfied. The provisions S. 4l of the Trade Marks Act, 1940 are almost identical to that of S. 28 of the Trade Marks Act, 1938 prevalent in England. The Trade Marks Act, 1940 was repealed by the Trade and Merchandise Marks Act, 1958 and which came into force from November 23, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Sub-sec. (4) of S. 49 demands that the Registrar shall dispose of the application in accordance with the directions issued by the Central Government under sub-sec. (3). The change effected between the provisions of S. 41 of Trade Marks Act, 1940 and S. 49 of the present Act is two-fold. In the former Act, the decision as to whether the application for being registered as registered user should be granted or otherwise was left to the Registrar of Trade Marks, while in the present Act, the decision has to be taken by the Central Government and the Registrar is merely required to dispose of the application in accordance with the decision and direction of the Central Government. The second change is that while in the former Act, the Registrar of Trade Mark had to bear in mind all the circumstances of the case and to enquire whether registration would not be contrary to the public interest, in the present Act, the Central Government can take into consideration all the circumstances of the case and the interest of the general public and the development of the industry, trade or commerce of India. 5. The Central Government in exercise of powers conferred by S. 133 of the Act read wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed policy of Government and the relevant consideration are totally ignored. It was submitted that petitioner No. 2 Company is a Public Limited Company with 60% of capital held by Indian shareholders and thus the Company is an Indian Company. The marks Colgate and Palmolive constitute the corporate name, trade name and trading style of the Company and incidentally these also happen to be used as trade marks, and, therefore, the Company has right to use its own corporate trade mark on the grounds produced by it. It was also contended that by virtue of strict control exercised by the registered proprietors, the petitioner No. 2 Company is maintaining a very high standard in the quality of products and that their marketing under the known trade marks such as those sought to be registered is very essential to prevent the spurt in the sale of spurious goods. Shri Tulzapurkar submitted that refusal of registration in respect of the marks already used for over several years would amount to disposition of substantive rights and would lead to very unusual results, as there is danger of marks being removed for non-user. The principal contention urged on behalf of the petitioners is that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not entitle the Central Government to reject registration on the basis of general policy of the Government. What sub-sec. (3) provides is that the registration can be refused if it is not in the interest of general public. Now, expression interest of general public under sub-sec. (3) Of S. 49 must have nexus or relation to the object for which the Act was enacted. The preamble to the Act provides that legislation was passed to provide for the registration and better protection of trade marks and for the prevention of the use of fraudulent marks on merchandise. S. 48(1) also recites that the application for registration shall not be entertained unless the agreement between the proprietor and the registered user complies with the conditions laid down in the rules for preventing trafficking in trade marks. It is, therefore, obvious that while examining whether the registration would affect the interest of general public, the Central Government must restrict the enquiry to the effect on the general public of the fact of registration of registered user in respect of the mark. The expression interest of general public does not entitle the Central Government to travel beyond the amb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the Calcutta High Court. The decision of the single Judge of the Calcutta High Court was carried in appeal and was set aside by Division Bench in the judgment reported in 1978-80 Industrial Property Law Reporter 9, Registrar of Trade Mark v. J. B. Williams and Co. Inc. It must be mentioned at once that before the Division Bench, the counsel appearing for proposed registered user stated that his client has no interest to seek the relief granted by the single Judge and, therefore, he was not interested in defending the appeal. The appeal was, therefore, heard by the Division Bench without any contest. The Division Bench set aside the decision of the single Judge holding that while it is permissible to look at the preamble of the Act for understanding the import of various clauses, full effect should be given to the express provisions of the Act even though they appeared to be beyond the terms of the preamble. The Division Bench held that the Courts could not start with the preamble for construing the provisions of the Act, though resort to it would be justified if the language used by the Parliament was ambiguous or too general. The Division Bench felt that there is no ambigu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision AIR1980Delhi200 , J.M.A. Industries Ltd. v. Union of India. It was held that the administrative authorities exercising powers under statutory provisions should realise that whether they are issuing a show cause notice why a certain action should not be taken or are communicating the reasons for decisions, it is not sufficient merely to recite the language of the statutory provisions but it is also necessary that the actual facts on which the decision is based should also be indicated. The Delhi High Court was examining the challenge to the action of the Central Government in refusing application filed u/S. 49 of the Act and observed that the words interest of the general public and the development of indigenous industry in India cannot give a true idea as to what facts or circumstances or reasons arising out of their application could be described as coming under these phrases. The Delhi High Court held that irreparable loss would be caused to the applicant if specific facts are not furnished to enable the applicants to controvert the objection raised by the Central Government. It is, therefore, obvious that the order rejecting the application should not merely refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t permissible to deprive them of user of trade mark by declining application u/S. 49(3) of the Act. I enquired from Mr. Master as to whether respondents are in possession of any material or data to indicate what is the demand for brushes including tooth brushes in the country and whether Small Scale Sector is in a position to meet such demand. I also enquired whether the Small Scale Sector would be able to maintain the price level of the brushes and the tooth brushes. Shri master stated that he is not in a position to make any statement on this aspect. Unless and until the Government has relevant data to reach the conclusion that it is possible for the Small Scale Sector to meet the demands of the customers in respect of tooth brushes and allowing user of foreign brand name in respect of tooth brushes would adversely affect the development and existence of indigenous industry, the application of proposed registered user could not be summarily thrown out. Even assuming that the conclusion of the Government that user of foreign brand name in respect of tooth brushes would affect the development of industry is correct, still the application could not have been thrown out and at the mo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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