Indian Journal of Law and Legal Research Volume IV Issue III | ISSN: 2582-8878

A STUDY ON THE EFFECT OF NON-USE OF TRADEMARKS

IN INDIA

Md Shoaib, Galgotias University

ABSTRACT

This paper surveys the operation of user requirements and the effect of non-
use of trademarks in India and examines what constitutes ‘use’ of a
trademark and then also examines non-use and its effects. Even though proof
of use is not required in many countries for either registration or renewal, it
is critical for maintaining trademark rights. Generally, the right to exclusive
use of a mark grows out of its use in connection with an established business
or trade. The user who first appropriates the mark obtains an enforceable
right to exclude others from using it, as long as the initial appropriation and
use are accompanied by an intention to continue exploiting the mark
commercially. Accordingly, failure to use the mark can result in a loss of that
right, and trademarks may be attacked on the ground of abandonment or non-
use. Almost all countries in the world permit a third party to petition the
Trademark Office to cancel a registration for non-use.

Keywords: use, non-use, trademark.

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Introduction:

Trade and business go on expanding and markets keep on growing, consequently, an

increasing number of trademarks are registered all over the world. Trademarks are, generally,
words, names, symbols, devices, designs, or other distinctive signs or marks which serve to
identify the source of goods or services and distinguish them from those sold by others. A
trademark will not always reveal the name of the source, but if consumers understand that all
of the goods or services sold under a particular mark emanate from a single entity, or from
others approved by that single entity, then such mark functions as a trademark. Trademarks
also symbolize the goodwill, that a company has established for a product or service, and
provide protection for the company’s investment in that goodwill. Moreover, trademarks
perform an important role as advertising tools for their owners. They aid consumers because
trademarks represent consistent quality. Trademarks are exclusive rights conferred on the
owner. Consequently, the use of trademarks by others without permission in connection with
similar goods or services is an actionable wrong because such use is an infringement of the
owner’s rights.1

If there is a breach of trademark, the proprietor of the registered trademark can take legal action
but for an unregistered trademark the only option is passing off.

The will be no uniqueness if there is non-use of a mark, where non-use is on the part of the
registered trade mark holder but not in relation to exterior factors beyond the control of such
registered trade mark holder. Thus it cannot be doubted that granting of relief under Section 46
is a discretionary relief and the Legislature in its wisdom has provided a period which must
lapse before an application may be made, however, the provision of the Act is silent with
respect to the starting time of limitation.

In India trademark law is far more laidback in comparison and certainly takes a broader view
of “use” of the mark. For starters, rectification/cancellation procedures can only take effect
when there is an objection to the non-use of the mark by a third party. Standing as it is,
registration does not get cancelled, even though the mark may not have been in use for a

1
Marylee Jenkins, Introduction to trademarks, 800 PLI/Pat 57, 60.

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considerable period of time, since registered trademark owners in India are not required to
periodically prove ongoing use of their marks in order to maintain registration.

India has confirmed certain countries as convention countries, which afford to citizens of India
similar privileges as granted to its own citizens. A person or company from a convention
country, May within six months of making an application in the home country, applies for
registration of the trademark in India. If such a trademark is accepted for registration, such
foreign national will be deemed to have registered their trademark in India from the same date
on which they made an application in the home country.2

The functions of a Trade Mark:

The function of the trademark is to distinguish the goods or services of one undertaking from
those of other undertakings. The vital function of the trademark is to recognize and distinguish
the source of origin, while other functions have become at least as essential as the
communication, advertising and investment functions. The scope of the
trademark corresponds with the classes that delegate one or more goods and services.
According to this specificity principle, the senior trademark is safeguarded against identical
marks for the same goods, and markets keep on growing and trade and business go on
expanding. Consequently an increasing number of trademarks are registered all over the world.
Trademarks are, generally, words, names, symbols, devices, designs, or other distinctive signs
or marks which serve to identify the source of goods or services and distinguish them from
those sold by others.

Rights of a Trade Mark user:

A trademark will not always reveal the name of the source, but if consumers understand that
all of the goods or services sold under a particular mark emanate from a single entity, or from
others approved by that single entity, then such mark functions as a trademark. Trademarks
also symbolize the goodwill, that a company has established for a product or service, and
provide protection for the company’s investment in that goodwill. Moreover, trademarks
perform an important role as advertising tools for their owners. They aid consumers because

2
https://zestip.com/critical-overview-of-the-effect-of-non-use-of-trademarks

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Indian Journal of Law and Legal Research Volume IV Issue III | ISSN: 2582-8878

trademarks represent consistent quality. Trademarks are exclusive rights conferred on the
owner.

Duty cast onto the registered proprietor not only to show that there is no intentional
abandonment or intent to use the trade mark, in relation to the goods, but there must exist a
definite intent to use the mark and a continuation of the same throughout the entire period as
envisaged in the statute but all his efforts were rendered fruitless by reason of the statutory ban
on imports. The affidavit of Buttress, however, negates such a situation and as such the issue
under Section 46(3) being answered in favour of the appellant does not and cannot arise

Uses of a Trade mark

Chapter VI of the Trademarks Act, 1999 deals with use of trademarks and registered users 3and
Section 47 allows the removal of a trademark from the register for non-used Section 47 of the
Act provides that a registered trademark can be taken off the register on an application made
by any person aggrieved if there was no bona fide intention of using the mark by the registrant
or by the company to be formed and the mark had not been used up to three months prior to
the application or if the mark was not used on the goods for more than five years starting the
three months prior to the application.4.

In the case of J N NICHOLAS LTD V ROSE AND THISTLE court interpreted that ‘use’ does not
necessarily mean and imply actual physical sale; even mere advertisement without having even
the existence of the goods can be said to be a ‘use’ of the mark.5

Non Use:-

A registered trademark can be cancelled within five years of the date of completion of the
registration procedure the mark has not been put to legitimate use by the proprietor or anybody
who has his consent and there are no proper reasons for non-use.

Indian trade mark does not require the filing of an affidavit for the uninterrupted use of
trademark however non-use of trade mark for five years is a ground for removal from the

3
Section 46 of the Act deals with the registration of a trademark by a company to be formed.
4
Wadhera B L, Law Relating to Patents, Trademarks, Copyright, Designs and Geographical Indications, 3rd
edn, (Universal Law Publishing Company, Delhi), 2004, p. 222
5
J N Nicholas Ltd v Rose and Thistle, 1993

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register. Under the Indian trade mark system once the owner of a mark registers the mark it is
sufficient for such registration to be prima facie evidence of validity.6

When is the use required?

In India, according to Section 47 of the Trademarks Act, 1999 use of a trademark has to be
shown by the registrant if an application is filed by an aggrieved person stating that the said
trademark was registered without bona fide intention on the part of the applicant for registration
that it should be used in relation to those goods or services by him. Moreover, there has to be
use of the trademark up to a date three months before the date of the application. In India, it
has been held that the burden of proof of non-use lies on the applicants for rectification of
register, and they have to show that there was no bona fide intention to use the mark or any
bona fide use of the trademark.7

Effect of non-use of Trademark:-

Result of Non-Use on Trademark in India the main effect of non-use is removal of the
trademark from the trademark registry. However, sometimes new goods or services are
launched to the market using trademarks which have not been re-registered or which have not
been used for a very long period of time. In such cases, most of the trademark proprietors keep
quiet about the new trademark which infringes their existing mark because of the fear of the
new user attacking the trademark on the ground of non-use and in such a case it would result
in the trademark being completely removed from the registry. In India, rectification on the
ground of non-use arises usually in the course of opposition proceedings or infringement action
as a counterblast. Where the proprietor has not used the mark for more than five years and has
not taken any steps to use it may tend not to object to the registration of similar marks by others
or launch infringement proceedings.

Section-47 removal from register and imposition of limitation on ground of non use of
trade mark:

Ø According to Trade mark Act 1999, Section 47 says, A trade mark once registered can
be removed or taken off from the register upon application to concerned body on the

6
https://zestip.com/critical-overview-of-the-effect-of-non-use-of-trademarks
7
Trade mark act 1999, chapter-VI, Section-47

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following grounds.

• No valid intention existed to use the trade mark:

An application for removing trademark can be made by any person on the ground that the
trademark was registered by proprietor without any intention to use such trademark in relation
to those goods and services.

There should be no bona fide use of the trademark in relation to those goods and services since
three months before the date of such application under the section 47

• No use of trademark by the proprietor for 5 years :

A registered trademark can be removed from the registered if it has not been used by the
proprietor for a continiuous period of 5 years or more relation to those goods and services.

Under these provision the period of 5 years has been calculated from the date from which the
trade mark is actually entered in the registered.

Exception to this rule- if special reasons have been proved by the proprietor for non use of
trade mark such as restriction imposed by law and not with any intent to not use the mark, then
such Trade mark will not be removed from the register.8

Land mark judgment on section 47

The Honble Supreme court in the case of kabushiki kaisha Toshiba v. TOSIBA appliances
(2008)- held that the intention to use a trade mark sought to be registered must be genuine and
real. The division bench further explained that when a trademark is registered, it confers a
valuable right. It seeks to distinguish the goods made by one person from those made by
another. The person therefore, who does not have any bona fide intention to use the trade mark
is not expected to get his product registered as to prevent any other person from using the
same.9

8
Section 47 of the trademark act 1999.
9
kabushiki kaisha Toshiba v. TOSIBA appliances(2008)

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Case laws:

In Ruston and Hornby Ltd. v. Zamindara Engineering Co., it was held that since the
trademark has been registered in the name of the plaintiff validly which was renewed, the
defendant had no right to use the said mark of the plaintiff as it would amount to infringement
of the plaintiff’s exclusive rights. In that case, noticeably it was established as a fact that, non-
use of the trademark by the plaintiff was not willingly but due to limitations imposed by the
Government in respect of dairy business and in the circumstances, there was no abandonment.10

In K.R Beri & Co. vs. The Metal Goods Mfg. Co Pvt Ltd. and Anr, the Division Bench in lieu
of Section 48(2) held that an unregistered user of the trade mark even with the consent of the
proprietor, cannot be construed to be a registered user under Section 48(1) and such
construction renders violation of sub-section (2) of Section 48. On a strict interpretation, the
view of the Division Bench may be correct, but it is not correct to hold that by a bona fide user
of an unregistered user when connection between the proprietor of the trade mark and the
permitted user in relation to passing off the goods under the trade mark are proved, it does not
render violation of sub-section (2) of Section 48.

A trademark may be removed from the register for non-use incessantly for five years except
when it is shown that the non-use has been due to existence of ‘special circumstances’ in the
trade and not due to any intention to abandon or not to use the trade mark. In the instant case,
the applicants failed to prove such ‘special circumstances’. The Court said that word ‘use’ does
not necessarily mean an imply actual physical sale and even more advertisement without
having even the existence of the goods can be said to be a ‘use’ of the mark.11

Research methodology:

The methodological approach used in the research paper is doctrinal and case study method.
The data used in the research is collected from both primary and secondary sources.

Conclusion:-

The phase of non-use of a trade mark for five years as a ground for removal should be reduced

10
Ruston and Hornby Ltd. v. Zamindara Engineering Co
11
K.R Beri & Co. vs. The Metal Godds Mfg. Co Pvt Ltd. and Anr

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to three years under the Indian law. In Indian legislation, there should be a separate provision
for remedies for similarity of famous marks. In India grounds that the trademark had been
registered without any bona fide intention to use, and there has not been the use of the
trademark for a continuous period of time. It is then that the trademark can be removed from
the trademark register. In India ‘use’ is given broader interpretation, thus, even if there are no
real sales of the goods or provision of services, mere advertisement would suffice. To the effect
that apart from bringing an action for infringement of trade mark, the owner of trade mark
could initiate a dilution suit for claiming special damages, as famous marks have close
association with the goodwill of the business.

India seems to be lenient in accepting excuses for non-use. On a comparative basis, the USA
seems to be far ahead as the courts have held even cases of strikes as a justifiable reason for
non-use. India also permits non-use ‘due to special situations in the trade. However, it is not
very clear as to what extent the courts would accept what is meant by special circumstances in
the trade’ as the cases which have come before the courts mainly deal with clear-cut cases such
as import restrictions, government policy etc. Indian courts seem to have tried to accommodate
the needs of the Indian scenario when dealing with trademark cases.

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