Registrar of Trade Marks vs Ashok Chandra Rakhit Ltd
Rewritten Version Notice: This is a rewritten version of the original judgment.
Court: supreme-court
Case Number: Civil Appeal No. 116 of 1953
Decision Date: 15 April, 1955
Coram: Natwarlal H. Bhagwati, Bhuvneshwar P. Sinha
The case was titled Registrar of Trade Marks versus Ashok Chandra Rakhit Ltd and was decided on 15 April 1955 by the Supreme Court of India. The judgment was delivered by a bench that included Justice Natwarlal H. Bhagwati and Justice Bhuvneshwar P. Sinha. The petitioner in the proceedings was the Registrar of Trade Marks and the respondent was Ashok Chandra Rakhit Ltd. The judgment bears the citation 1955 AIR 558 and 1955 SCR (2) 252. The legal provisions that formed the core of the dispute were drawn from the Trade Marks Act 1940 (Act V of 1940), specifically section 13 which deals with the meaning and scope of registration subject to a disclaimer, and section 76 which governs an appeal to the High Court.
The headnote of the judgment explained that the power conferred on the Registrar by section 13 of the Trade Marks Act is a discretionary power. Such discretion must be exercised not arbitrarily or capriciously, but in accordance with established principles that guide all judicial discretion. The headnote further noted that the two jurisdictional facts set out in clauses (a) and (b) of section 13, together with a finding that the trade mark contains parts or matters that are exclusively the property of another, do not by themselves settle the issue. It must still be demonstrated that there is a satisfactory ground for imposing a disclaimer, and only then will the tribunal exercise its discretionary power for a cause shown to be good. For a proper understanding of section 13, it is essential to remember that the provision vests the discretionary authority in the “tribunal,” which under section 2(n) means either the Registrar or, where appropriate, the Court before which the proceedings are pending.
Assuming, without deciding, that an appeal under section 76 of the Act from a decision of the Registrar made under section 13 is before the High Court, the headnote clarified that the High Court is not bound by the Registrar’s prior exercise of discretion. The High Court may exercise its own discretion just as it could if the matter had originally been instituted before it. Nevertheless, the initial discretionary power resides with the Registrar. If the Registrar has acted in good faith and has not contravened any legal requirement, the High Court should not interfere merely because it might have reached a different conclusion or because it believes it would have exercised discretion differently had it been the first forum. The correct approach, therefore, is for the High Court to examine whether the Registrar’s decision was so erroneous that interference with his discretion is warranted.
The headnote also explained the substantive purpose of requiring a disclaimer. A disclaimer is intended to define the rights of the proprietor under the registration so as to minimise the risk of unwarranted or excessive claims that could arise from the registration of a trade mark. The proviso to section 13 preserves any right that the proprietor may have under other laws in respect of the mark or any part of it. The disclaimer operates only for the purposes of the Trade Marks Act and does not affect the proprietor’s rights except those that arise from the registration itself. Consequently, the special advantages conferred by the Act on the proprietor do not extend to the parts of the mark that are disclaimed.
In this case, the Court explained that a disclaimer attached to a trade-mark registration is intended to limit the scope of protection that the law grants to the proprietor. The purpose is to reduce, though not entirely remove, the risk that the registration could be used to support extravagant or unauthorised claims. The Court noted that the proviso to section 13 of the Trade Marks Act preserves any right that the proprietor may have under other legislation in relation to the mark or any part of it. Accordingly, a disclaimer operates only for the purposes of the Act and does not affect those rights except where they arise directly from the registration itself. In other words, the special benefits that the Act confers on the proprietor because of the registration of his trade-mark do not extend to the portions of the mark that are disclaimed. After reviewing all the circumstances, the Court held that the Registrar had not acted so improperly as to require interference by the High Court. The Court emphasized that, if the matter were to be treated as a question of whether the High Court should impose a disclaimer, the High Court had failed to consider a crucial factor: the strong possibility that the respondent company might claim a statutory right to the word “Shree” solely on the basis of its registration, thereby enabling it to pursue infringement actions without the factual proof that would otherwise be required in a passing-off suit or a criminal prosecution under the Indian Penal Code. Because this important consideration was omitted, the Court concluded that the High Court had not properly exercised its discretion.
The judgment further recorded that the Court referred to several authorities to support its reasoning, including Sharp v. Wakefield (L.R. 1891 A.C. 173), Albert Baker Co.’s Application and Aerated Bread Company’s Application (In re (L.R. 1908 2 Ch. 86; 25 R.P.C. 513)), the matter of an application by the Diamond T. Motor Car Co. ([1921] 38 R.P.C. 373 at 379), Eno v. Dunlop (L.R. 1890 15 A.C. 252; 7 R.P.C. 311), the matter of an application by F. Reddaway & Co. Ltd. ([1926] 44 R.P.C. 27), Smokeless Powder Co.’s Trade In re (L.R. 1892 1 Ch. 590; 9 R.P.C. 109), Greers Ltd. v. Pearman and Gorder Ltd. ([1922] 39 R.P.C. 409), Cadbury Brothers’ Application (In re (L.R. 1915 2 Ch. 307; 32 R.P.C. 456)), De Cordova and others v. Vick Chemical Coy. ([1951] 68 R.P.C. 103), Pinto v. Badman (8 R.P.C. 181), Apollinaris Company’s Trade Marks (L.R. 1891 2 Ch. 186) and Clement & Cie In re (L.R. 1900 1 Ch. 114). The judgment concluded with the formal citation of the appeal: it was a civil appeal (No. 116 of 1953) in the Civil Appellate Jurisdiction, arising from the judgment and order dated 23 August 1951 of the Calcutta High Court in Appeal No. 112 of 1950, which in turn stemmed from the Registrar’s order dated 24 March 1950 concerning Registered Trade Mark No. 3815.
Counsel for the appellant was R. H. Dhebar, assisted by a colleague, while counsel for the respondents was S. C. Isaacs, assisted by P. K. Ghosh. The judgment was pronounced on 15 April 1955, and the opinion of the Court was delivered by Justice Das. The case before the Court was an appeal against the judgment and order issued on 23 August 1951 by a Division Bench of the Calcutta High Court in Appeal No. 112 of 1950. That High Court judgment had reversed the order dated 24 March 1950 made by the Registrar of Trade Marks, an order in which the Registrar had corrected the trade-mark register by inserting a disclaimer to the word “Shree”, which formed part of the respondent company’s registered trade mark numbered 3815. The material facts relevant to the appeal were then set out. In 1897 the late Durga Charan Rakhit adopted as his trade mark a device for the ghee he produced and marketed. With only minor modifications that did not alter its essential features, the respondent company later applied for and obtained registration of that device as its trade mark No. 3815. The mark consists of the word “Shree” placed at the top in bold Bengali characters; beneath it appears an ornamental figure within which the word “Shree” is written in small Devanagari script at the centre. On the left side of the ornamental figure the English word “TRADE” is shown in an inclined position, and on the right side the English word “MARK” appears similarly inclined. At the bottom of the device the words “Shree Durga Charan Rakhit” are written in Bengali characters. The ornamental figure itself is formed by a triangle surmounted by an inverted triangle, the centre of which contains the word “Shree” in the small Devanagari script, the whole figure being enclosed by a circle that is surrounded by twelve ornamental petals. In an affidavit sworn by Malli Nath Rakhit, a director of the respondent company and filed in these proceedings, the mark was consistently referred to as “the said mark SREE”. Subsequently, Durga Charan Rakhit was adjudicated insolvent, and all of his assets, including the goodwill of his ghee business and the trade mark, vested in the Official Assignee of Calcutta.
On 15 January 1915 the Official Assignee sold the goodwill of the business together with the trade mark by public auction. The highest bidder and purchaser was Hem Dev Konch, who was a minor at the time. A notice announcing the sale was published in the Calcutta Exchange Gazette on 25 January 1915 by an attorney acting on behalf of the purchaser. The sale was formally confirmed by a deed of assignment executed by the Official Assignee on 27 January 1915. Later, on 22 August 1917, Haripriya Konch, the father and natural guardian of the minor purchaser, acting in that capacity and on behalf of the minor, conveyed to Ashok Chandra Rakhit—who was the son of the late Durga Charan Rakhit—the goodwill of the business, including the right, title and interest in
The Court recorded that Ashok Chandra Rakhit continued to operate the ghee business and used the said mark in marketing the product. On 15 September 1926 he caused a public notice stating his ownership of the mark to appear in the Calcutta Exchange Gazette, and on 22 December 1926 he arranged for a declaration of his ownership to be filed with the Registrar of Assurances of Calcutta. In 1932 the respondent company was incorporated as a private limited company under the Indian Companies Act, 1913, and Ashok Chandra Rakhit transferred to that company the goodwill of his business together with his right, title and interest in the mark. The following year, 1933, the respondent’s mark was entered in the Trade Mark Registry of Hong Kong pursuant to the Hong-Kong Trade Marks Ordinance, 1909, and the registration was published in the Straits Settlements Government Gazette. In 1934 two individuals, Rajendra Prasad and Dilliram, were convicted by the Chief Presidency Magistrate of Calcutta, on a complaint brought for the respondent company, under section 486 of the Indian Penal Code for infringing the mark; that conviction was upheld by the Calcutta High Court. In 1935 another person, Chiranjilal Sharma, was similarly convicted by the Chief Presidency Magistrate for infringement of the same mark. The Court noted that the respondent’s ghee business, conducted under the mark, was substantial, with annual turnover ranging between ten lakh and fifteen lakh rupees and annual advertising expenditures varying from ten thousand to thirty-nine thousand rupees. The ghee marketed by the respondent and its predecessors was widely recognized by the public under the name “Shree”. After the Indian Trade Marks Act, 1940 came into force in 1942, the respondent filed an application on 21 August 1942 for registration of its mark under the Act. On 29 November 1943 the Registrar, by letter, proposed that the word “Shree” be disclaimed. The respondent, through a letter dated 15 February 1944, objected to the proposal, stating that the trade mark “Shree” was essential to its device and that the ghee was commonly identified by that mark. The respondent also filed an affidavit, signed by director Bidyut Bikash Rakshit, supporting its objection. The Registrar did not pursue the disclaimer, and the mark was duly entered as Trade Mark No. 3815. Subsequently, the Registrar observed that the word “Shree” was employed by Hindus as an auspicious symbol and appeared on letterheads, concluding that it was not adapted to distinguish goods within the meaning of the Act.
In this matter the Registry had long followed a practice of either refusing registration of the word “Shree” as part of a trade mark or requiring a disclaimer whenever the word appeared in a mark. The practice was applied so rigidly that, apart from trade mark number 3815, no other mark containing the word “Shree” had ever been entered on the register without a disclaimer. This uneven treatment was perceived as an invidious discrimination, and reference was made to the need for the Registry to deal impartially and uniformly with all applications concerning this practice. Accordingly, the Registrar acted on the issue by invoking section 46(4) of the Trade Marks Act, 1940 and, on 8 March 1947, issued a notice directing the respondent company to show cause why the register should not be rectified by inserting a disclaimer of exclusive rights in respect of the word “Shree.” The respondent answered the notice by filing an affidavit sworn by Malli Nath Rakhit, as has been referenced. After hearing the counsel representing the respondent, the Registrar concluded that the word “Shree” was not adapted to distinguish the goods and, for the reasons set out in his judgment dated 24 March 1950, ordered the register to be corrected by entering a disclaimer stating: “Registration of this Trade Mark shall give no right to the exclusive use of the word ‘Shree.’” Dissatisfied with this decision, the respondent company appealed to the Calcutta High Court under section 76 of the Act. The High Court observed that the term “Shree” possessed numerous meanings and that no trader could claim exclusive rights over such a word. Nevertheless, the Court held that the Registrar’s order lacked any foundation because the respondent had never asserted a claim to exclusive use of “Shree.” Consequently, the High Court allowed the appeal, set aside the Registrar’s rectification order, and, recognizing the novelty and significance of the issue for future Registry actions, certified the case as appropriate for appeal to this Court under Article 133(1)(c) of the Constitution. The present appeal therefore challenges the Registrar’s order of rectification, which was made under section 13 read with section 46(4) of the Trade Marks Act, 1940. Section 13 provides that a registration may be subject to a disclaimer if the mark contains any part not separately registered, any matter common to the trade, or any element of a non-distinctive character; the Tribunal may require the proprietor to disclaim any exclusive right to such part, provided that the disclaimer does not affect any rights arising from the registration itself.
Section 13 provides that if a trade mark contains either (a) the name of the proprietor or any element for which no separate application for registration has been made, or (b) any matter that is common to the trade or otherwise lacks distinctiveness, then, when the tribunal is deciding whether the trade mark should be entered in or remain on the register, it may, as a condition of registration, require the proprietor to either disclaim any right to the exclusive use of that part or of any portion of that matter, insofar as the tribunal holds the proprietor not to be entitled to such exclusive use, or to make any other disclaimer that the tribunal considers necessary to define the proprietor’s rights under the registration. The provision further states that no disclaimer shall affect any rights of the proprietor except those rights that arise out of the registration of the trade mark to which the disclaimer relates.
At the outset, it is clear that the tribunal’s power to impose a disclaimer is conditioned upon the existence of one of the two jurisdictional facts set out in clauses (a) and (b). Only when one of those jurisdictional facts is established does the Registrar acquire jurisdiction to consider imposing a disclaimer. However, before exercising that discretion, the Registrar must first find and hold that the trade mark contains parts or matters whose exclusive use the proprietor is not entitled to enjoy. Only after making such a finding does the Registrar become entitled to exercise his discretionary power.
During the arguments, it was initially contended that once the requisite jurisdictional fact was established and the finding was made that the proprietor was not entitled to the exclusive use of a particular part or matter, the Registrar could, without any further justification, require a disclaimer of that part or matter. This extreme position was subsequently abandoned, and it was conceded that the power conferred on the Registrar by this section is always a matter of discretion. That discretion must be exercised not capriciously or arbitrarily but in accordance with the sound principles that govern all judicial discretion. The Court referred to the observations of Lord Halsbury, L.C., in Sharp v. Wakefield (L.R. 1891 A.C. 173 at p. 179), noting that the law of trade marks in our Act largely mirrors English law with only slight modifications. Accordingly, reference to the judicial decisions on the corresponding English provision is appropriate and helpful. Section 15 of the English Trade Marks Act 1905, later reproduced in section 14 of the English Act 1938 and corresponding to our section 13, was considered by the High Court.
In England, the cases In re Albert Baker Co.’s Application and In re Aerated Bread Company’s Application (collectively known as the ABC case) were examined. In those proceedings, Justice Eve held, on the evidence, that the Albert Baker Company was widely recognised by the public as “A.B.C.” or “A.B. & Co.”, but observed that the letters “A.B.C.” were not exclusively linked to the company’s goods and that, because the letters were commonly used in trade, the company could not claim exclusive rights to them. The judge, however, did not decide the matter solely on that observation. He explained that the Legislature’s purpose was to free traders from the need to make a disclaimer and therefore any condition imposing a disclaimer should be supported by a good reason rather than imposed automatically. He added that the wording of the statute was in an enabling form, granting the tribunal the power to impose a condition only when good cause was shown. From this it followed that merely establishing one of the two jurisdictional facts listed in clauses (a) and (b) of section 13, together with a finding that the trade mark contains elements for which the proprietor does not have exclusive rights, was insufficient. The authority still had to demonstrate a satisfactory reason for ordering a disclaimer, and the tribunal would exercise its discretionary power only when such good cause was established (see L.R. [1908] 2 Ch. 86; 25 R.P.C. 513).
The second important point, if section 13 is to be correctly understood and applied, is that the statute vests a discretionary authority in the “tribunal”. By virtue of section 2(n), this “tribunal” refers to the Registrar, or, as appropriate, the Court before which the proceeding is pending. An application for rectification of the register may be filed, under subsections (1) and (2) of section 46, either with the Registrar or with the High Court. Sub-section (4) of the same provision, which underlies the present proceedings initiated by the Registrar, empowers both the High Court and the Registrar to commence proceedings on their own motion. Because the High Court also possesses discretion under section 13, a question arose whether the observations of P. O. Lawrence, J. in In the matter of an application by the Diamond T. Motor Car Co. (see [1921] 38 R.P.C. 373 at p. 879) applied. In that case, Justice Lawrence had held that when the High Court reviews an appeal from a decision of the Registrar made under section 8(2) of the English Act of 1919, the High Court is not constrained by the Registrar’s prior exercise of discretion. This principle was considered for its relevance to the present matter.
In this case the Court considered whether the High Court, when hearing appeals filed under section 76 of the Act against decisions of the Registrar made under section 13, could exercise its own discretionary power in the same way it could if the proceedings had originally been instituted before the High Court. Assuming, without deciding, that such appeals are indeed within the High Court’s jurisdiction, the Court recalled the language of Lord Macnaghten in Eno v. Dunn, observing that the Registrar is the authority “to whom in the first instance is committed the discretionary power.” The Court stated that if the Registrar has exercised that discretion in good faith and without contravening any legal provision, the High Court should not set aside the Registrar’s decision merely because the High Court believes it might have decided differently, or even that it would have decided differently, had the matter been presented to it initially. The appropriate course, according to the Court, is for the High Court to examine whether the Registrar’s exercise of discretion was so erroneous that interference becomes necessary, a principle articulated by Lord Dunedin in the matter of an application by F. Reddaway & Co. Ltd. The Court further noted that the expressed purpose of the relevant section is not to grant any direct advantage to rival traders or the general public, but rather to delineate the rights of the trademark proprietor as defined by registration. It observed that registration of a trademark bestows considerable benefits upon its owner, as set out in Chapter IV under the heading “Effect of Registration.” Nonetheless, the Court recognised that some proprietors attempt to expand the operation of their marks beyond legitimate limits, citing the case of In re Smokeless Powder Co.’s Trade Mark as an example. It also mentioned instances where proprietors have made exaggerated exclusive claims over parts of their marks despite expressly disclaimed rights, referring to Greers Ltd. v. Pearman and Corder Ltd., commonly known as the “Banquet” case. The Court explained that the purpose of a disclaimer is to define the proprietor’s rights under the registration and to minimise, if not entirely prevent, extravagant and unauthorized claims. Finally, the Court highlighted that the proviso of the section preserves any right the proprietor may possess under other laws, emphasizing that the disclaimer operates solely for the purposes of the Act.
The Court explained that a disclaimer attached to a trade mark does not affect the proprietor’s rights except those that arise solely from the registration itself. In other words, the special benefits conferred by the Trade Marks Act on the owner because of the registration do not extend to the parts or matters that the owner has expressly disclaimed. The disclaimed elements are therefore excluded from the statutory protection afforded by the Act. This exclusion, however, does not mean that the proprietor loses any other rights he may have in those elements outside the Act. If, for example, the proprietor has acquired a right through long and uninterrupted use of the disclaimed part in connection with goods he manufactures or sells, or otherwise in the course of his trade, he may, upon proving the necessary facts, enforce those rights by a passing-off action or by a prosecution under the Indian Penal Code. The disclaimer itself does not diminish such common-law rights. With this principle in mind, the Court turned to the question of whether, in the present case, the Registrar had correctly exercised his discretion in entering a disclaimer for the word “Shree” in the register, consistent with the meaning and purpose of section 13 of the Trade Marks Act, 1940 as previously discussed.
The Court noted that it was not contested that the respondent’s trade mark, registration number 3815, is a distinctive device that falls within the ambit of section 6 of the Act. The mark prominently incorporates the word “Shree”, which had never been registered separately by the respondent nor had any application been filed for its independent registration. Consequently, the jurisdictional condition referred to in clause (a) of section 6 was satisfied. The Registrar, after examining the matter, concluded—relying on reasons he set out—that the word “Shree” was not adapted to distinguish the goods of the respondent and therefore failed to meet the registrability test laid down in section 6, particularly sub-section (3). The High Court concurred, observing unequivocally that “Shree” is a word with numerous meanings and that no trader could realistically claim an exclusive right to its use. As a result, the respondent’s mark was found to contain a non-distinctive element, satisfying the second jurisdictional condition. Nonetheless, the High Court held that there was no proper basis for the Registrar’s order. It viewed the Registrar’s decision as arising solely from a rigid practice within the Registry, whereby a word such as “Shree” would either be refused registration or be subject to a disclaimer if it formed part of a mark, a practice the Court considered to be inappropriate in the circumstances of the present case.
In the matter before the High Court, the word “Shree” was either refused registration as a trade mark or a disclaimer was imposed whenever it formed part of a trade mark. The High Court observed that, on this basis, the present case was indistinguishable from the decision in In re Cadbury Brothers’ Application (1). That earlier case had been decided under section 9 of the English Trade Marks Act 1905, where clause (5) of that provision was expressed in language that differed from clause (5) of section 6 of the Indian Act. Under section 9(5) of the English Act a name, signature or word that did not fall within the description of paragraphs I to 4 could not be deemed a distinctive mark unless the Board of Trade or a court ordered otherwise. The word “Tudor”, being a surname, did not fall within clause (4) of the English Act; consequently the Registrar then had no power to register it as a distinctive mark under clause (5). Because of this limitation, the Registrar in England adopted a practice that whenever a mark contained a name outside clause (4) and beyond his authority to register under clause (5), a disclaimer of that word had to be entered without any inquiry into its distinctiveness. Accordingly, the Registrar declined to register the mark solely because it contained a name that he could not register alone under section 9(5), and he did so without deciding whether the word was distinctive or non-distinctive, following the inflexible practice of refusing registration in the absence of a disclaimer.
This decision of the Registrar was later overruled by Sargant J. The learned judge, after examining the material before him, concluded that the word “Tudor” was not common to the trade and that, as used by the applicants in connection with chocolates, it was not a matter of non-distinctive character but rather denoted their goods. As a result, the jurisdiction to impose a disclaimer under clause (b) of section 15 of the English Act of 1905 did not arise. Any jurisdiction that might have existed could only have arisen under clause (a), namely where the trade mark contained parts that were not separately registered by the proprietor as trade marks. Having found that “Tudor” possessed distinctive character because it identified the applicants’ chocolate products, the Court could have disposed of the matter on the brief ground that the applicant was entitled to the exclusive use of that name in relation to chocolates and similar goods, and therefore no disclaimer was necessary. Nevertheless, treating the issue still as one of discretion, the judge considered the commercial arguments advanced by the applicants. They contended that imposing a disclaimer would effectively invite the public to ignore the common-law rights they had acquired in the name “Tudor” and would force them into numerous passing-off actions. The Court noted that the facts of the Tudor case were clearly distinguishable from the present case, where both the Registrar and the High Court had concurrently found that “Shree” was not adapted to distinguish and was not a word over which any trader could claim exclusive rights. In that context, the concern that a disclaimer might precipitate a flood of passing-off actions was not as pressing or relevant as it had been in the Tudor case.
In the earlier Tudor case the applicants argued that, if they were forced to relinquish any claim to the exclusive use of the word “Tudor,” they would effectively be inviting the public to ignore the common-law rights they had already acquired in that name. The Court observed that imposing a disclaimer on the word, even after recognizing its distinctiveness for the applicants’ goods, would compel the applicants to commence a multitude of passing-off actions. The present matter, however, was distinguished from that earlier case. Both the Registrar and the High Court concurred that the word “Shree” was not adapted to distinguish the goods and that no trader could claim an exclusive right over it. Because of this finding, the worry that a disclaimer might force the respondent company into a flood of passing-off suits was not as pressing as it had been in the Tudor dispute. Accordingly, the Court held that the respondent could, as it indeed had, protect its interests through other legal avenues such as passing-off actions or prosecutions permitted by the proviso, provided that the necessary factual foundation—facts which were not before the Registrar—could be satisfactorily established.
The judgment further noted that it would be inaccurate to state that the Registrar, following the example of his English counterpart, based his decision solely on the so-called invariable practice of the Registry. While it was true that the Registrar placed considerable emphasis on that practice and perhaps over-stressed it, his decision was not founded exclusively on that ground. The documents before the Registrar, particularly the affidavit filed on behalf of the respondent company, plainly showed that the respondent claimed a proprietary right to the name “Shree.” Throughout the affidavit the respondent referred to its mark as “the said mark Shree,” asserted that this mark was well known in the market, and contended that its ghee was commonly requested and sold under the name “Shree.” The two prosecutions initiated by the respondent, together with the facts set out in the main affidavit and the supporting affidavits of two retail dealers, reinforced the claim that the respondent sought exclusive use of the word “Shree.” Moreover, a letter from the respondent’s agents dated 15 February 1944, which objected to any disclaimer of the word, described it as “trade mark Shree” and described it as “very important in the devise.” In sum, the respondent asserted that “Shree” itself constituted its trade mark, separate from the overall device.
In this case, the Court noted that the respondent company, through counsel before the Registrar, explained that if the word “Shree” were required to be disclaimed, it would be far easier for the company to succeed in an infringement action than in a passing-off action. That statement indicated that the company did not wish any other trader to use the word “Shree” in a trademark for ghee, and that the company believed the registration of its mark containing the word would, by itself, give it a right to that word. The company intended to bring infringement proceedings under the Trade Marks Act against any other trader who used the word “Shree”, whether alone or as part of a mark, in connection with ghee. The Registrar could reasonably have thought that the fact other traders who obtained trademarks containing “Shree” were required to submit a disclaimer, while the respondent obtained registration without such a disclaimer, might embarrass those other traders and might encourage the respondent to claim a proprietary right to the exclusive use of the word “Shree”. The respondent might also have been encouraged by the observations of Lord Radcliffe in De Cordova and others v. Vick Chemical Coy.(1), where it was held that if a word that forms part of a mark has become identified in the market with the goods of the owner, another trader’s use of that word as a mark or as part of a mark would constitute infringement because it is likely to cause confusion. These considerations could therefore have led the Registrar to require a disclaimer. The Court observed that none of those considerations were present or mentioned in the Tudor case, and that this difference clearly distinguishes the present matter from that earlier decision. The Court also reiterated the principle that when a distinctive label is registered as a whole, the registration does not give the proprietor an exclusive statutory right to each individual word contained in the label, but only to the label as a combined whole. As Lord Esher said in Pinto v. Badman(2): “The truth is that the label does not consist of each particular part of it, but consists of the combination of them all.” Similar observations can be found in In re Appollinaris Company's Trade Marks(1), In re Smokeless Powder Co., In re Clement and Cie(1) and In re Albert Baker and Company (supra).
In this part of the judgment, the Court referred to Baker & Company (supra) and to the Tudor case decided by Sargant, J. It observed that, although those authorities suggested that a disclaimer might not be required, that observation does not mean that a disclaimer is always unnecessary in similar circumstances. The Court emphasized that one of the factual bases for the tribunal’s jurisdiction to order a disclaimer is that the trade mark contains components that have not been registered separately. Accordingly, the statutory provision expressly contemplates that a disclaimer may be imposed on parts of a trade mark that is registered as a whole, even though registration of the whole mark does not confer any statutory right in respect of the individual part. The Court further noted that the possibility of a proprietor attempting to enlarge the operation of his trade mark cannot be ignored. That possibility must be taken into account by the tribunal—whether the Registrar or a Court—when it exercises the discretionary power conferred by the statute. The High Court had referred to the observations of Eve, J. in the A.B.C. case and had posed the question whether any good cause had been shown for the necessity of a disclaimer in the present case. The High Court answered that no cause had been demonstrated beyond the desirability of maintaining a uniform practice. The Court disagreed with that conclusion. It pointed out that, apart from the desire for uniform practice, the Registrar had drawn attention to another important consideration. On the evidence before him and on the counsel’s statements, it was clear that the company opposed the disclaimer because it mistakenly—though erroneously—believed that registration of the trade mark as a whole would give it an exclusive right to use the word “Shree” as if that word were separately registered, and that such a belief would make it easier to succeed in an infringement action than in a passing-off action. The Court held that the very possibility of such an extravagant and untenable claim called for a disclaimer in order to define the rights of the respondent company under the registration. This aspect, the Court observed, had not been pressed before or adverted to by the High Court. Considering all the circumstances discussed above, the Court was not of the opinion that the Registrar had acted so incorrectly as to make it necessary for the High Court to interfere with his discretion. If the matter were to be regarded as a discretionary exercise by the High Court as to whether a disclaimer should be imposed, it was clear that the attention of
In the Court’s view, the High Court had failed to consider a material point. That point was the considerable likelihood that the respondent company could invoke a statutory entitlement to the word “Shree” merely because it had secured registration of that word as a trade mark. By relying on the registration, the respondent could potentially bring infringement proceedings against other parties without having to produce the factual evidence that would ordinarily be required to succeed in a passing-off claim or to support a prosecution under the Indian Penal Code. Because the High Court did not take this possibility into account, the Court concluded that the High Court had not exercised its discretionary power in a proper manner. As a consequence of this error, the Court held that the appeal filed by the appellant must succeed. Accordingly, the respondent company was ordered to pay the costs incurred by the appellant in both the Supreme Court and the High Court.