TRADE MARK

What is a Trade Mark

The essence of a trade mark is that it indicates a connection in the course of
trade between the goods and some person having the right to use the same.
The function of a trade mark is to give an identification to the purchaser or a
possible purchaser as to the manufacturer or quality of the goods, to give an
indication, to his eye, of the trade source from which the goods come or the
trade hands through which they pass on their way to the merchant.
A trader acquires a right of property in a distinctive mark merely by using it
upon or in connection with the goods, irrespective of the length of such user
and the extent of his trade. A trader who adopts such a mark is entitled to
protection directly, the article having assumed a vendible character, is
launched upon the market. Registration in such a case does confer a new
right to the mark. In fact, a single actual use with intent to such use "eo
instante" confers a right to such mark as a trade mark. Registered trade mark
is a valuable right, a right to exclusively use the trade mark in connection with
the goods a right which cannot be encroached upon or infringed by any other
person".
Trade Mark is property:
Trade Mark is also one of the species of intangible property and which is in
modern language described as intellectual property. It is also an industrial
property as trade mark is essentially related to commerce or industry. While a
patent involves some invention, in a trade mark there is no invention. Any
mark such as a design, a label, a sign etc. known to every body can be used
to indicate certain goods and once the association of the mark with the goods
gets established in the mind of the customers, a right to use the that mark in
connection with those goods may arise.
In case of a patent. the right is to the patented articles itself and which is the
object of commerce. In case of trade mark. the goods which are the subject of
commerce are different from the mark which is not the subject of commerce
but a close relation is built up between the goods and the mark and they go
together though they are separate. Patent is therefore totally different from a
trade mark though both are concerned as intangible moveable property.

Similarly while in a copy right there is a creation of some artistic or literary

mark there is no such thing in a trade mark. A trade mark may not be artistic.
While a copy right involves the use of human intellectual faculty, a trade mark
does not; at the most, it involves some commercial or trading aptitude, though
trade mark is also called an intellectual property. In fact. it can be only and
aptly be described as industrial property while a copy right cannot be aptly
called an industrial property.
A trade mark is like an indicator which when looked at, immediately identifies
the goods as well as the maker of the goods.
It has been held in the case of
Acqua Mineral D V.s. Pramode Borse, AIR 2001 Del. 463
that 'domain' name functions as the trade mark and is not a mere address or
like finding number on the internet and therefore is entitled to equal protection
as trade mark for it also identifies the internet site to those who reach it, much
like a person's name identifies a specific company. In other words the domain
name has the same protection as any trade name has been provided under
the Trade and Merchandise Marks Act, 1958.2
DEFINITION OF TRADE MARK
Under the Act 47 of 1999 : - The Indian Trade Marks and Merchandise Act of
1958 has now been repealed and replaced by the Trade Marks Act of 1999.
The statement of objects and reasons of the Act says that Trade and
Merchandise Act, 1958 had served its purpose and need was felt that in view
of development in trading and commercial practices and increasing
globalisation of trade and industries to encourage to investment flows and
transfer of technology as well as for simplification and harmonization of trade
mark management system and to give effect to important judicial decisions.

The expression trade mark is defined in sec. 2 (zb) of the new Act to mean
"a mark capable of being represented graphically and which is capable of
distinguishing the goods or services of one person from those of others and
may include shape of goods, their packaging and combination of colours and
(i)

in relation to offences generally a registered trade mark or a mark

used in relation to goods and services for the purpose of indicating
and so as to indicate a connection in the course of trade between
the goods or services as the case may be and some person having
the right as proprietor to use the mark and

(ii)

in relation to other provisions of this Act a mark used or proposed to

be used in relation to goods or services for the purpose of indicating
or so to indicate a connection in the course of trade between the
goods and services as the case may be, and some person having
the right either as proprietor or by way of permitted user, to use the
mark whether with or without any indication of the identity of that
person and includes certification trade mark or collective mark.

So the definition includes two types of trade marks, one to which the
provisions of the Chapter XII of the Act apply and other trade marks. And a
trade mark does not only mean a mark in relation to goods but also in relation
to services.
The word 'mark' is defined in sec. 2(m) to include a device, brand, heading,
label, ticket name, signature, word, letter, numerical, shape of goods,
packaging or combination of colours or any combination thereof.
The word 'services' is defined, in Sec. 2(z) to mean service of any description
which is made available to potential users and includes provision of services
in connection with business of any industrial or commercial matters such as
banking, communication, education, financing, insurance, chit funds, real
estate, transport. storage, material treatment, processing, supply of electrical
or other energy, boarding, lodging, entertainment, amusement construction
repairs, conveying of news or information and advertising.
So under this Act trade mark not only applies to goods but even to services.

Chapter XII containing Sec. 101 to 121 relates to offences, penalties and
procedures. Sec. 101 gives the meaning of applying a trade mark or trade
description and inter alia provides that a person shall be deemed to apply a
trade mark or mark or trade description to goods or services who
(a) applies it to the goods themselves or uses it in relation to services or
(b) applies it to any package in or with which the goods are sold or exposed
for sale or had in possession for sale or for any purpose of trade or
manufacture.
Sec. 102 deals with what amounts to falsify a trade mark and falsely applying
trade mark to goods or services and the remaining sections of that Chapter
deal with penalty forfeiture and the procedure for prosecuting of offenders. So
section 2(zb) (i) defines a trade mark, the falsification or misapplication of
which is punishable while sub-clause [ii] contains a general definition of the
expression 'trade mark'. Certification trade mark means briefly the mark which
is certified by the proprietor under Chapter IX Sec. 2(e) and 'collective mark' is
defined in sec. 2(g) to mean "a mark distinguishing the goods and services of
members of an association of persons (not being a partnership within the
meaning of the Indian Partnership Act, 1932) which is the proprietor of the
mark from those of others."
ASSIGNMENT OF TRADE MARK
Where the assignment is made of trade mark otherwise then in connection
with goodwill of the business. the assignment shall not take effect unless
within 6 months or extended period of three months, the Assignee applies to
the Registrar for directions with respect to the advertisement of the
assignment and advertises it as required by the Registrar.
Assignment of trade mark in respect of some of the goods or services
accompanied by transfer of goodwill or assignment of trade mark for goods
exported out of India or services rendered out of India accompanied by
transfer of goodwill of the export business is not assignment made otherwise
than in connection with the goodwill.

(iv) A certification of trade mark shall not be assignable otherwise than with
the consent of the Registrar. The expression certificates of Trade Marks is
defined in Sec. 2(e) of the Act.
REGISTRATION :
Every assignment is required to be registered with the Registrar of Trade
Mark (See Sec. 45 of the Act)
REGISTERED USER:
A proprietor of a registered trade mark can allow any other person to use the
trade mark for his own benefit or on his own account. That is the registered
trade mark owner can give a licence to another to use the trade mark without
assigning the trade mark. But such user is required to be registered. Sec. 48
provides that a person other than the registered proprietor of a trade mark
may be registered as a registered user in respect of any or all the goods or
services in respect of which the trade mark is registered. For that purpose
under Sec. 49 both the proprietor and the user of the trade mark. are required
to enter into an agreement in writing with respect to the permitted use of the
trade mark and a copy of that agreement and an affidavit of the proprietor are
required to be filed with the Registrar and after going through the prescribed
procedure he is to register the name of the registered user. Under Sec. 54 a
registered user has no right to assign his right though he can be a partner in a
firm and use the trade mark as a partner on behalf of the firm.
It may be stated that the registration of a trade mark is liable to be refused if
the Registrar finds that the trade mark is being used by a person other than a
registered user or proposed registered user.

LICENCE :
Apart from the assignment of Trade Mark. A Trade Mark can be allowed to be
used on licence basis for any or all of the goods in respect of which the trade
mark is registered. There is no direct or specific provision in the Act that a
trade mark can be allowed to be used by another on licence basis. There is
no specific prohibition against licensing on the other hand. The provisions of
S. 41 indicate that it can be done.
While an assignment is a permanent transfer of the rights of a trade mark
proprietor to the assignee, a licence is only a temporary permission of the
proprietor of a trade mark to another for a temporary use of the trade mark
exclusively or non exclusively. On a licence the ownership of the trade mark
remains with the registered proprietor while in an assignment, the owner
ceases to be the owner. Besides assignment can be made of a trade mark
alongwith or without the goodwill of the business of the proprietor. But in case
of a licence, the goodwill will remain with the owner. An assignment cannot be
revoked. while a licence is always revocable, on breach of the terms of the
license. Licence should be for a short period as there is always a danger of
the licensed trade mark being treated as the trade mark of the licensee in
respect of the goods manufactured or sold by him by long usage and the
original owner of the trade mark loosing the reputation of being the owner of
the trade mark in respect of the goods manufactured or sold by him. and there
is danger of the registered proprietor loosing the registration. Therefore in a
licence. precaution should be taken to see that it does not result in confusion
or deception in the public or that the trade mark is continued to be recognised
as that of the original proprietor and also continues to be connected with
goods manufactured or sold by the proprietor. Subject to these precautions. a
trade mark can be given for use on licence with or without the goodwill of the
business. Licensing can be done in two ways. One is to allow the Licensee to
use the trade mark in the manufacture and/or sale of the goods on account of
the Licensee. The other is to allow the Licensee to manufacture the goods
with the trade mark stamped thereon but the right to sell the goods is retained
by the Licensor that is the proprietor of the trade mark.

A licence may be registered or not. But the Act provides for registration of a
user's licence. Section 48. however, provides that a person other than a
registered proprietor of a trade mark may be registered as the registered user
thereof in respect of any or all the goods in respect of which the trade mark is
registered. The procedure for registration of such registered user is also laid
down in sections 49 to 53. Section 54 provides that nothing in the Act shall
confer on the registered user of a trade mark any assignable or transmissible
right to the use thereof. However. a registered user can enter Into a
partnership with any other person for carrying on the business concerned and
in such a case the firm may use the trade mark only for so long as the
registered user is a member of the firm.
Stamp Duty On the assignment of Trade Mark, stamp duty will be the same
as on conveyance of moveables ad valorem basis on the consideration.
Registration A document of assignment or licence is not required to be
registered under the Registration Act, 1908 but registration is required under
the Trade Mark Act.