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DECODING TRADEMARK RECTIFICATION: MADRAS HC'S FRESH TAKE ON THE SYNERGY OF SECTIONS 47, 57, AND 124 OF THE TRADEMARK ACT, 1999

September 15, 2024

*Ms.Pratistha Priyadarshi

INTRODUCTION:

The inclusion of counterclaims in trademark rectification petitions has been a contentious issue in Indian trademark law. Traditionally, petitions filed under Sections 47 and 57 of the Trademark Act, 1999, are treated as separate proceedings, with no clear framework for incorporating counterclaims. This has led to significant uncertainty, especially when these sections intersect with Section 124, which governs different aspects of trademark disputes. The question of whether counterclaims should be allowed is crucial, as it affects procedural efficiency and the comprehensive adjudication of related trademark issues.

On August 20, 2024, the IP Division of the Madras High Court delivered an important order in Solidaire Digital Electronics Private Limited v. Salahudeen Abdhullatheef & M/S. Sagar Enterprises. The court addressed whether counterclaims could be allowed within rectification petitions, a decision that could reshape how such disputes are handled. This ruling offers valuable insights into the court’s evolving interpretation of the Trademark Act and may set new precedents for future trademark cases in India.

The dispute in this case is centered around the trademark "Solidare" (Trademark No. 1574746 in Class 9). The court considered whether counterclaims could be included in rectification petitions filed under Sections 47 (non-use cancellation) and 57 (rectification) of the Trademark Act. This blog will explore the potential precedential significance of this ruling, particularly in terms of the interaction between Sections 47, 57, and 124 (stay during infringement suits)—a combination frequently encountered in rectification disputes.

BACKGROUND OF SECTIONS 47, 57, AND 124 OF THE TRADEMARK ACT

A rectification application under the Trademark Act must be filed in accordance with Sections 47, 57, 68, or 77, depending on the circumstances, along with Rule 92 of the Trade Marks Rules, 2002. In this case, the focus is on Sections 47 and 57. Analyzing the order requires consideration of two primary points:

  1. The authority granted to the Court under Section 57(3) and (4), which allows the Court to examine and rectify trademark-related matters. This enables the Court to entertain counterclaims even in the absence of explicit provisions in the Act.
  2. The lack of a dedicated provision in the Trademark Act permitting counterclaims within rectification petitions. This legal ambiguity raises doubts about whether counterclaims should be allowed in practice.

THE COURT'S BROAD JURISDICTION UNDER SECTION 57 OF THE TRADEMARK ACT

The recent ruling highlights the broad discretionary powers conferred upon the Court under Sections 57(3) and 57(4) of the Trademark Act. These provisions empower the Court to address questions regarding trademark registration, including the possibility of entertaining counterclaims, although counterclaims are not explicitly recognized under the Act. The respondent's counsel argued that the residual powers under Section 57 could extend to the inclusion of counterclaims. This argument relied on a Delhi High Court decision addressing the use of Section 57(4) in a procedural violation during a trademark infringement case. The respondent also cited the Supreme Court's ruling in Rajendra Prasad Gupta v. Prakash Chandra Mishra, where the court dealt with Section 151 of the Civil Procedure Code (CPC).

However, the Madras High Court did not fully accept the respondent's arguments. The court acknowledged the discretionary powers provided under Section 57(3) but clarified that this discretion is specifically intended for addressing issues directly related to trademark rectification. While Section 57(4) does grant the judiciary substantial powers, all concerned parties must be given notice and an opportunity to be heard. Since the counterclaim was submitted by a party already involved in the proceedings, the provision of Section 57(4) was deemed immaterial in determining whether the counterclaim was sustainable.

Nevertheless, the court's decision to consider the counterclaim as a separate petition questioning the legitimacy of the petitioner's mark is noteworthy. The counterclaim argued that the petitioner had copied the mark from a third party and thus had no basis for retaining the trademark in the Register. This approach by the court reflects its willingness to ensure proper procedural handling of trademark disputes, even in the absence of explicit statutory provisions for counterclaims in rectification petitions.

THE ABSENCE OF COUNTERCLAIMS IN TRADEMARK RECTIFICATION PETITIONS

The absence of provisions for counterclaims in trademark rectification proceedings remains a significant procedural gap in Indian law. Section 57(1) and (2) of the Trademark Act allows for rectification of entries in the Register based on procedural irregularities. However, the question of whether counterclaims can be introduced in rectification proceedings is not addressed by the Act.

In its recent ruling, the Madras High Court emphasized that the absence of counterclaim provisions in the Trademark Act contrasts with the CPC, which explicitly allows for counterclaims under Order VIII, Rules 6A to 6G. Similarly, the Madras High Court Intellectual Property Rights Division Rules, 2022, and the Trademark Manual issued by the Office of the Controller General of Patents, Designs & Trade Marks (CGPDTM) do not provide for counterclaims in rectification proceedings.

Historically, counterclaims in trademark disputes have been introduced in infringement or passing-off suits rather than rectification petitions. For example, in Vivek Kochher & Anr. v. KYK Corporation Limited & Ors., a counterclaim was filed in a passing-off suit after the court ordered rectification. Similarly, in Roland Corporation v. Sandeep Jain and Mandom Corp v. Fem Care Pharma Limited, counterclaims were introduced in related legal proceedings following rectification petitions. These precedents highlight the need for legislative clarity on whether counterclaims should be allowed in rectification proceedings.

REVISITING THE INTERSECTION OF SECTIONS 47, 57, AND 124 OF THE TRADEMARK ACT

Before exploring the interaction between Sections 47, 57, and 124, it is important to understand the distinct roles each section plays in trademark disputes. Section 124 provides for the stay of infringement proceedings when the validity of the trademark is in question. If either party disputes the validity of the other party's trademark in an infringement suit, Section 124 mandates that the suit be stayed until the question of validity is addressed.

The Supreme Court's landmark decision in Patel Field Marshal Agencies v. P.M. Diesels Ltd. clarified that Sections 47 and 57, which govern the rectification of trademarks, are constrained by Section 124 during ongoing infringement suits. The ruling established that a rectification petition can only be filed after the Civil Court frames an issue of invalidity in the infringement suit.

However, the Delhi High Court’s ruling in Anubhav Jain v. Satish Kumar Jain introduced a new dimension by suggesting that Section 124 does not necessarily override the rights provided under Sections 47 and 57. This raises an important debate about the interplay between these provisions.

CONCLUSION

In the present case, the Madras High Court chose to treat the counterclaim as an original petition rather than incurring the normal procedural costs and delays associated with filing a new petition. This approach is efficient in terms of time and resources. By converting the counterclaim into an original petition, the court enhanced procedural efficiency and minimized delays.

Nonetheless, the broader question of whether counterclaims should be allowed in rectification petitions remains unresolved. The current legal framework lacks explicit provisions for such counterclaims, highlighting the need for legislative reform to address this procedural gap in trademark law.

REFERENCES:

  1. Solidaire Digital Electronics Private Limited v. Salahudeen Abdhullatheef M/S. Sagar Enterprises, (T)OP(TM)/532/2023.
  2. Rajendra Prasad Gupta V. Prakash Chandra Mishra, (2011) 2 SCC 705.
  3. Madras High Court Intellectual Property Rights Division Rules, 2022, Rule 14.
  4. TRADEMARK MANUAL, Available At: https://Ipindia.Gov.In/Writereaddata/Portal/Ipoguidelinesmanuals/1_32_1_Tmr-Draft-Manual.Pdf.
  5. Vivek Kochher & Anr. v. KYK Corporation Limited & Ors., 2017 SCC Online Del 12294. 
  6. Roland Corporation v. Sandeep Jain, 2021 SCC Online Del 3482.
  7. Mandom Corp v. Fem Care Pharma Limited & Ors., ORA/293/2014/TM/MUM, On Aug 21, 2020. 
  8. Patel Field Marshal Agencies v. P.M. Diesels Ltd, C.O. (COMM.IPD-TM) 55/2021  
  9. Anubhav Jain v. Satish Kumar Jain, 2023 SCC Online Del 800. 

Authors:
* Ms.Pratistha Priyadarshi
5th Year Student,
National University of Study and Research in Law, Ranchi, Jharkhand

Disclaimer: The opinions expressed in the article are the personal opinions of the author. The facts and opinions appearing in the article do not reflect the views of the Alliance Centre for Intellectual Property Rights(ACIPR) and the Centre does not assume any responsibility or liability for the same.