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2001 Supreme(Mad) 1303
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE P. SHANMUGAM
S.V.S. Agro Refineries Private Limited - Appellant
Versus
Union of India and Others - Respondents
Writ Petition No. 18332 of 2001
Decided On : 06 November 2001
The joint ownership of a trade mark does not constitute consent of the owner for its use by another party, and compliance with Guideline Nos. 17 and 18 under the Companies Act is necessary for the registration of a company name.
Headnote:
Companies Act - Trade Mark - Sections 20, 22 - Guideline Nos. 17, 18
Fact of the Case:
The petitioner sought to quash an order under Section 22 of the Companies Act, 1956 directing the petitioner to change its name by deleting the word 'S.V.S'. The petitioner claimed joint proprietorship of the trade mark 'S.V.S' and argued that the third respondent had no locus standi to file the application under Section 22.
Finding of the Court:
The court found that the order of the second respondent, guided by Guideline Nos. 17 and 18, was valid as the petitioner failed to produce consent or a no objection certificate from the registered proprietors of the 'S.V.S' trade mark. The court also noted that the third respondent had obtained an injunction against the petitioner from using the expression 'SVS'.
Issues: The issues involved the applicability of Guideline Nos. 17 and 18 under the Companies Act, the joint proprietorship of the trade mark 'S.V.S', and the validity of the order under Section 22.
Ratio Decidendi: The court held that the petitioner's joint ownership of the trade mark did not constitute consent of the owner, and therefore, the order under Section 22 was valid. The court also considered the existence of an injunction against the petitioner from using the expression 'SVS'.
Final Decision: The writ petition was dismissed, and the order of the second respondent was sustained.
P. Shanmugam, J.
Petitioner has prayed for the issue of a Writ of Certiorari to quash the order of the second respondent dated 10.8.2001 by calling for the records. The impugned order is passed under Section 22 of the Companies Act, 1956 directing the petitioner to change its name within three months by deleting the word "S.V.S" from its name.
2. According to the petitioner, he is the joint proprietor of the trade mark "S.V.S" as well as the use of the letters "S.V.S". It is stated that The third respondent cannot claim monopoly to the family name and has no locus standi to file an application under Section 22 of the Companies Act. The petitioner, being the joint proprietor of the trade mark and the initials S.V.S., is entitled to use the same in any business carried on by him. According to him, the jurisdiction under Sections 20 and 22 of the Companies Act would arise only where the company with the impugned name is incorporated by a person other than the owner of the trade mark in question. It is contended that the second respondent has failed to consider this question and therefore, the order of the second respondent is liable to be set aside and the matter remanded for fresh consideration.
3. Mr. N.A.K. Sharma appearing on behalf of the third respondent submitted that on account of the use of the name and style of SVS Agro Refineries Pvt. Ltd. by the petitioner, using the Key letters of the respondents firm in the same address, they have initiated proceedings under Sections 20 and 22 of the Companies Act and a reasoned considered order, impugned herein, has been passed. The use of a company's name is permissible only if either the 'owner' of the trade mark consents or gives a no objection certificate. According to him, assuming, without conceding that the claim of the petitioner is that he is the joint proprietor of SVS trade mark, his consent alone does not constitute a consent of the owner for the use of SVS trade mark by the petitioner's company. The three partners of SVS Oil Mills, who are all registered proprietors of SVS trade mark, have neither consented to the use of SVS trade mark by the petitioner company nor they have given any no objection certificate. Hence, Guideline, No. 17 has been clearly violated and the exercise of power under Section 20 is perfectly valid. It is contended that if every joint owner of the registered trade mark is allowed on his own to give consent to the use of a trade mark without reference to the other joint owners, it will amount to flagrant violation of Section 24 of the Trade and Merchandise Marks Act, 1958, besides leaving to trafficking the trade mark. According to him, even under Guideline No. 18, petitioner company is not eligible to be registered under a name which includes the term 'SVS' when it has no connection with the existing firm of long standing and trading under the style SVS Oil Mills. Since SVS Oil Mills have built up enormous reputation and its annual turnover grosses rupees thirty nine crores, if the petitioner company is allowed to use SVS as part of its corporate name, it will mislead any reasonable person that some trade connection exists between the petitioner company and SVS Oil Mills.
4. I have heard both the counsel and considered that matter.
5. Though both the counsel referred to the previous history of the firm and the retirement of the petitioner and the arbitration proceedings. I am of the view that those are not necessary for the disposal of this writ petition. As a matter of fact. Mr. Arvind Dattar has confined himself to the short question of applicability of Guideline Nos. 17 and 18 and sought for remand of the matter for a fresh consideration.
6. It is seen from the impugned order that the second respondent has also confined himself to the Companies Act and the matters related thereto. The second respondent was guided by the principles set out by the Government of India. Department of Company Affairs for giving the name under the Companies Ac
