Corporate Name and Trade Mark Infringement
Introduction:This case involves a dispute over the rectification of the corporate name under Section 16 of the Companies Act, 2013, between the petitioner, M/s. Shaktiman Equipments Pvt. Ltd., and the third respondent, Tirth Agro Technology Pvt. Ltd. The petitioner challenged the order of the Regional Director (R2) directing it to change its name, alleging that it infringed upon the trademark rights of the third respondent.
Background: The Petitioner namely Shaktiman Equipments Pvt. Ltd., incorporated in 2012 under the name "Pioneer Generators Pvt. Ltd." and renamed in 2019. Respondent (R3): Tirth Agro Technology Pvt. Ltd., using the trademark "Shaktiman" since 2001 for agricultural machinery and equipment.
Dispute: The third respondent filed a petition under Section 16 of the Companies Act, alleging that the petitioner's corporate name was identical to its trademark, causing confusion and violating statutory provisions. The Regional Director accepted the petition and directed the petitioner to change its name. The petitioner filed a writ petition challenging this decision.
Trademark Usage: R3 is the registered owner of the trademark "Shaktiman," with registrations across multiple classes since 2001. The petitioner adopted the name "Shaktiman Equipments Pvt. Ltd." in 2019.
Regional Director’s Order: R2 held that the petitioner’s corporate name violated Rule 8A(1)(d) of the Companies (Incorporation) Rules, 2014, and directed a name change.
Arguments Before the Court:R3 argued prior and extensive use of the trademark, resulting in significant goodwill. The petitioner contended that its adoption of the name was bona fide and did not cause confusion.
Issues Raised:Whether the petitioner’s corporate name infringed upon the third respondent’s trademark rights. Whether the petitioner’s use of the name violated Section 16 of the Companies Act and Rule 8(2)(a)(ii) of the Companies (Incorporation) Rules, 2014. Whether businesses operating in different industries can use identical or similar names.
Petitioner's submission: Claimed bona fide adoption of the name "Shaktiman" based on due diligence.
Argued that the term "Shaktiman" is descriptive and used by multiple entities. Highlighted differences in business nature and product categories between the petitioner and R3.
Respondent (R3) Submission: Asserted prior use of the trademark "Shaktiman" since 2001. Highlighted trademark registrations across various classes, including international registrations.Claimed that the petitioner’s name caused confusion and diluted its brand identity.
Judgments Referred:
MindTree Ltd. v. Regional Director:
Held that suffixing additional words to a distinctive name does not negate the similarity.
Montari Overseas Ltd. v. Montari Industries Ltd.:
Affirmed that adoption of a similar trade name likely results in appropriation of goodwill.
Raymond Pharmaceuticals Pvt. Ltd. v. Union of India:
Established that similarity or identity in names is a bar against subsequent adoption.
These precedents reinforced the principles of prior use and the bar on identical names under the Companies Act.
Reasoning of the Court:
Prior Use and Goodwill:The Court emphasized that R3 had been using the trademark "Shaktiman" since 2001, establishing significant goodwill in the agricultural machinery industry.
Violation of Statutory Provisions:The petitioner’s use of the name violated Rule 8(2)(a)(ii) of the Companies (Incorporation) Rules, which prohibits identical names without the trademark owner’s consent.
Distinct Industries Argument:The Court rejected the petitioner’s argument that the parties operated in different industries, holding that similarity in names is barred across trades.
Descriptive Nature of the Mark:The Court held that while "Shaktiman" may be descriptive, its long-standing association with R3 gave it a secondary meaning, making it distinctive.
Public Confusion:The Court found that the similarity in names could confuse the public and dilute the distinctiveness of R3’s trademark.
Decision: The Court dismissed the writ petition and upheld the Regional Director’s order, directing the petitioner to change its corporate name within three months. The Court emphasized that the statutory framework protects prior users and prohibits identical or deceptively similar names to avoid confusion.
Case Title: Shaktiman Equipments Pvt. Ltd. Vs. Union of India & Others
Date of Order: October 14, 2024
Case Number: W.P. No. 12314 of 2021
Neutral Citation: 2024:MHC:4124
Court: High Court of Madras
Bench: Hon’ble Dr. Justice Anita Sumanth
Advocate Ajay Amitabh Suman
[Patent and Trademark Attorney]
High Court of Delhi
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