Trademark Holders Cannot Be Penalized For Non-Compliance Of Rules By Registrar: Delhi HC Upholds Single Judge's Order [Read Order]

The Delhi High Court, on Friday, upheld Justice Vibhu Bakhru's in-depth analysis of the provisions relating to renewal and restoration of the trademark in the case of M/S Epsilon Publishing House Pvt. v. Union Of India.

In the impugned order, Justice Bakhru had inter alia emphasized on the legal proposition that a registered proprietor of a trademark cannot be penalized for non-compliance of rules by the Registrar of Trademarks.

This order had now been challenged by Epsilon Publishing House Pvt. Ltd., before a Bench comprising Justice S. Ravindra Bhat and Justice A.K. Chawla.

The matter concerned renewal of the trademark, 'LOKPRIYA EASY NOTES' which belonged to the Respondent, Mr. Pardeep Kumar Jain. Epsilon had contended that an application for renewal was filed on 19 May, 2011, when the registration had already expired on 2 May, 2011.

It had relied on Section 25(3) of the Trade Marks Act, 1999 as well as Rules 65 and 66 of the Trade Marks Rules, 2002 to contend that since the renewal application was not filed before the expiry of the trademark, the Registrar was required to remove it from the Register.

Section 25 (3) essentially requires the Registrar to send a notice to the proprietor for renewal of the registered mark and allows the Registrar to remove the trademark from the register, in case the prescribed conditions are not complied with.

Relying on this provision, Epsilon had submitted that since the renewal application was made 17 days after the expiry of the trademark, it should have been accompanied by the prescribed surcharge in addition to the prescribed fee. It then pointed out that Mr. Jain had not paid the surcharge and hence, the Registry should not have granted the renewal.

It had further asserted that Section 25(3) did not grant discretionary power to the Registrar to condone delay. It had, therefore, demanded that Mr. Jain's trademark should be removed from the register.

Justice Bakhru had, however, not accepted these contentions and had opined that if the trademark must automatically stand removed from the date of expiry of the registration, then the registered proprietor would be deprived of the grace period of six months as provided in the proviso to Section 25(3). He further asserted that such an interpretation would also deprive the proprietor of the right to seek restoration, which can be exercised within a period of six months.

Justice Bakhru had also observed that the language employed by Section 25(3) negated such interpretation, explaining, "It is necessary to note that the word used in section 25(3) of the Act is 'may‟ and not 'shall'. The proviso to Section 25(3) is also couched in negative language which proscribes the Registrar from removing the mark, if an application is made in the prescribed form and prescribed fee and surcharge is paid within a period of six months.

Thus, in any event, the Registrar has to continue to retain the trademark on the Register till the expiry of the period of six months from the expiry of registration in order to provide a full play to the proviso to Section 25(3) of the Act. Thus, even if an application for renewal with the prescribed fees and surcharge is received within a period of six months from the expiry of the registration of the trademark, the Registrar cannot remove the trademark from the Register."

More importantly, Justice Bakhru had stressed on the Registrar’s responsibility to point out defects in a renewal application, so that the registered proprietor gets the opportunity to cure them. He had observed, "In the present case, it is pointed out that there is a consistent practice to examine all applications for renewal and to point out deficiencies. This would obviously include the deficiency in payment of fee/surcharge as well, thus, enabling the concerned party to cure the same."

He had further noted that Rule 64(1) of the 2002 Rules requires the Registrar to inform the proprietor regarding the approaching expiration of the trademark at least one month and, not more than three months prior to the date of expiry.

 Furthermore, Justice Bakhru had rejected the contention that Epsilon should have been granted a hearing, and did not accept reliance on Rule 66, which requires the Registrar to have regard to the interests of affected persons. He noted that such right arises only once the trademark has been removed from the Register.

The Division now agreed with Justice Bakhru's findings and upheld the impugned order.