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PETITIONER: AMERICAN HOME PRODUCTS CORPORATION

       Vs.

RESPONDENT: MAC LABORATORIES PRIVATE LIMITED AND ANR.

DATE OF JUDGMENT30/09/1985

BENCH: MADON, D.P. BENCH: MADON, D.P. SEN, AMARENDRA NATH (J)

CITATION:  1986 AIR  137            1985 SCR  Supl. (3) 264  1986 SCC  (1) 465        1985 SCALE  (2)933

ACT:      Trade Marks  Act, 1940  (5 of 1940), ss.14(1) and 39(2) and Trade  and Merchandise Marks Act, 1958 (43 of 1958), ss. 18,  46(1)(a)(b)   and  48  -  "Trade  Mark"  -  What  is  - Registration of  Valuable right  on the  proprietor  whether conferred - Infringement of rights - Remedies - What are.      Trade Marks  Act, 1940 - s.14(1) - Trade mark ’Dristan’ Registration of.      Trade and  Merchandise Marks  Act, 1958 - S.46(1)(a)(b) "Trade Mark" - Removal of from Register of Trade Marks - Two conditions  precedent  under  cl.(a)  must  be  cumulatively satisfied - Burden of proving applicability of s.46(1)(a)(b) - On  person seeking  removal of  trade mark  -  Distinction between cls.  (a) and  (b) - What is - S.46(1) - Object of - Trafficking  in  trade  mark  What  is  -  Ascertainment  of bonafide intention  to use  trade mark  Whether dependant on the facts  and circumstances of each case Whether continuous chain of  events even  subsequent  to  the  application  for registration to  be considered - Intention to use trade mark sought to  be registered  - Must  be genuine and real at the date of  application for  registration -  Whether the  words "proposed to  be used  by him"  in s.18 mean "proposed to be used by the proprietor, his agents and servants" - Effect of sub-s.(2) of s.48 on sub-s. (1) of s.18 - What is.      Trafficking in Trade Marks - What is.      Interpretation OF Statutes:      Deeming provision - Full effect to be given.      Construction leading  to manifest absurdity, injustice, inconvenience or anomaly to be avoided.      Precedents: Doctrine of      English  decisions   -  Can   be   referred   to,   but applicability would  depend upon  context  of  Indian  laws, legal procedure  and practical  realities of  litigation  in India. 265

HEADNOTE:      The appellant-American  Home Products Corporation, is a Corporation incorporated  in the  United States  of America. One of  its activities  is, the manufacture and marketing of pharmaceutical products  and drugs  carried on  through  its division "Whitehall Laboratories". The appellant was dealing

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with the  Indian Company  -  Geoffery  Manners  &  Co.  Ltd. through its  subsidiary -  Home Products  International Ltd. Some time  prior to 1956 lt acquired 40% shareholding in the Indian Company.  In 1956 it introduced an anti-hystamin drug in the  American market  under the  trade-mark ’Dristan’. It got the  trade mark  ’Dristan’ registered  as a  distinctive trade mark  in the Trade Marks Register in the United States and subsequently in several foreign countries.      The appellant  entered into  a technical  collaboration agreement with  the Indian  Company effective  from Nov.  1, 1957. Under  this agreement  the Indian Company received the formulae, manufacturing  technology,  and  other  assistance essential for  the efficient manufacture in India of various products of  the appellant.  The appellant  granted  to  the Indian  Company,  for  the  duration  of  the  agreement  an exclusive and  non-transferable licence to make and sell the "Licensed Products"  in India under the name or marks of the appellant. The  agreement inter  alia further  provided that rights of  registered user  will be  extended to  the Indian Company  in  respect  of  each  "Licensed  Product"  by  the appellant - proprietor of such trade mark.      Pursuant to  the  collaboration  agreement  the  Indian Company  manufactured  and  marketed  the  products  covered thereunder and  got itself registered as the registered user in respect of the trade marks relating to the goods of which the appellant  was the  registered proprietor.  On and  from December 1957  it was decided that the Indian Company should introduce in  the  Indian  market  nine  new  drugs  of  the appellant including  ’Dristan’ tablets.  On August 18, 1958, the appellant  filed an  application under  8.14(1)  of  the Trade Marks  Act 1940,  in Form TM-I for registration of the trade  mark   ’Dristan’  in  class  5  claiming  to  be  its proprietor and  that the same was proposed to be used by it. The application  was advertised  as required  by  the  Trade Marks  Rules   1942.  No   Notice  of   opposition  to   the registration of  the trade mark was filed by any one and the trade mark  ’Dristan’ was  registered on June 8, 1959 by the Registrar of  Trade Marks  as trade mark No. 186511 in class 5. Thereafter, the Indian Company obtained a licence for the purchase of a machine for manufacturing of ’Dristan’ tablets and installed the same. 266      On  May   31,  1960,   the  first   respondent  -   Mac Laboratories Private  Ltd. - applied for registration of the trade mark  ’Tristine’ in  class 5. On January 18, 1961, the appellant filed  a notice  of opposition to the registration of the mark ’Tristine’ on the ground that it was deceptively similar  to   its  trade  mark  ’Dristan’.  The  appellant’s opposition was  not accepted  by the  Assistant Registrar of Trade Marks  and by his order dt. March 27, 1962, he ordered the trade  mark ’Tristine’ to be registered in Part A of the Register of  Trade Marks.  The appellant  thereupon filed an appeal in  the Bombay  High Court  which was  allowed  by  a Single Judge  on Feb. 5, 1963. The appeal filet by the first respondent before  a division  Bench was  allowed  with  the directions that  the respondent’s  application be amended so as to read the trade mark ’Tristine’ as ’Tristine’.      During the  pendency of  the application  of the  first respondent for registration of the trade mark ’Tristine’ the Indian Company  on Sept.  23, 1960  applied to  the  Central Govt. under  s.11  of  the  Industries  .  (Development  and regulation) Act 1951 for a licence to manufacture the tablet ’Dristan’ which  was granted  on January  19, 1961  for  the manufacture of  ’Distran’ tablets  to the  extent of 5 lakhs tablets per month with the conditions that "no royalty would

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be payable"  ant that the products will be marketed with the trade mark already in use or without any trade mark. It also applied for  an import  licence for  import of materials for manufacture of  ’Dristan’  tablets,  and  got  approval  for manufacture of ’Dristan’ tablets.      On October  18, 1961 another agreement was entered into between the appellant ant the Indian Soprano for granting to the latter  the non-exclusive  right to  use the  trade mark ’Dristan’ upon  or in  relation to  the goods  in respect of which  the   said  trade  mark  was  registered  during  the unexpired residue  of the  term of  the registration  of the said ‘trade  mark. Under  this agreement  the Indian Company agreed to  become the  registered user  of  the  trade  mark ’Dristan’ ant  further agreed  that the rights granted to it under the agreement would not be deemed to entitle it to use the  trade  mark  otherwise  than  as  the  registered  user thereof.      On October  22, 1961,  the ’Dristan’ tablets were first marketed in India by the Indian Company. On March 6, 1962, a joint application in Form TM-28 was ate by the appellant ant the Indian  Company for  registering the Indian Company as a registered user  of the  trade mark  ’Dristan’ in respect of the goods for 267 which it  was registered  subject to  certain conditions  or restrictions.  The  application  stated  that  the  proposed permitted use  was without  limit of  period subject  to the right of  the appellant  registered proprietor  to apply for cancellation of  the registered  user forthwith after notice in writing to the Indian Company.      The first  respondent on  April 10, 1961 filed with the Registrar of  the Trade Marks an application under 88.46 and 56 of  the 1958  Act for  rectifying the  register of  Trade Marks by  removing  therefrom  the  appellant’s  trade  mark ’Dristan’ on the grounds:           (i) That  the trade  mark ’Dristan’ is deceptively           ant  confusingly   similar  to   the  trade   mark           ’Bistan’’ already  registered in class 5 ant which           has been used and is being used.           (ii) That  the trade mark ’Dristan’ is deceptively           similar to   the  trade mark  ’Tristine’ which the           Applicants have  lawfully been using since October           1960 in respect of their medicinal preparation.                (111) That there has been no bona fide use of                trade mark  ’Dristan’ in India in relation to                the goods  for  which  it  is  registered  by                proprietor thereof  for the  time being  upto                date  one  month  before  the  date  of  this                application."      On May  5,  1961,  the  first  respondent  applied  for amendment of  the Rectification  Application by substituting the submissions in support of the grounds taken earlier. The submissions so substituted were :           "(1)  That   the  trade  mark  ’Dristan’  was  not           distinctive mark and/or was not registerable trade           mark under  s.6  of  the  Trade  Marks  Act,  1940           (corresponding to  s.9  of  Act  No.40  of  1958),           except upon evidence of its distinctiveness ant no           such  evidence  was  submitted  to  the  registrar           before registration.           (ii) That  the said  trade mark  was registered in           contravention of  s.8 of the Trade Marks Act, 1940           (corresponding to s.11 of Act of 1958). 268           (iii) That the said trade mark offends against the

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         provisions of 6.11 of the Act.           (lv)  That   the  trade   mark  ’Distran’  is  not           distinctive  of   the  goods   of  the  registered           proprietors.           (v) That  the trade  mark ’Dristan’ was registered           without any bona fide intention on the part of the           Applicants that  it would  be used  in relation to           their  medicinal   preparation   for   symptomatic           treatment of respiratory ailments by them and that           there has, in fact, been no bona fide use in India           of the  said trade  mark ’Dristan’  in relation to           the said goods by the said proprietors upto a date           one month before the date of this application."      On December  7, 1964,  the  Registrar  of  Trade  marks dismissed  the   Rectification  Application   of  the  first Respondent holding  that the  Whitehall Laboratories  was  a division of  the appellant  and not  a separate legal entity and, therefore, the mark could not be registered in its name but only  in the  name  of  the  appellant  and  accordingly ordered the entry in the Register relating to the Trade mark ’Dristan’  to   be  varied   by  amending   the   registered proprietor’s  name   to  read  as  "American  Home  Products Corporation trading  as Whitehall  Laboratories." The appeal filed by  the first  respondent was  allowed by  the  Single Judge holding  (1) that  at the  date of  the making  Of the application for  registration the  appellant did  not have a bona fide  intention to  use the  trade  mark  ’Dristan’  by itself, (2)  that the appellant had not at any time used the said trade mark in relation to the goods in respect of which it was  registered, (3)  that the  legal fiction  created by 8.48(2) of  the 1958  Act came  into play only after a trade mark was  registered and  that an intention to use the trade mark through  someone who  would  subsequently  get  himself registered as  a  registered  user  did  not  amount  to  an intention on  the part  of the applicant for registration to use the  trade mark  himself; and  (4) that  to  accept  the appellant’s   contention    would   amount   to   permitting trafficking in trade marks. In view of these conclusions the Single Judge did not decide the question whether  trade mark ’Dristan’ was  deceptively and  confusingly similar  to  the trade mark ’Bistan’.      In the appeal filed by the appellant the Division Bench held that  trade mark  ’Dristan’  was  not  deceptively  and confusingly similar  to the  trade mark ’Bistan’. Dismissing the appeal it, 269 however, agreed  with the  view taken by the Single Judge in respect of  the construction  which he had placed upon ss.18 and 48  of the  1958 Act  to come to the conclusion that the appellant had no bona fide intention to use itself the trade mark ’Dristan’  and that  the appellant  had not at any time made use of the said trade mark.      In the  appeal to this Court on behalf of the appellant it was contended:           (1) the legal fiction created by sub-s.(2) of 8.48           18, as  expressly stated  in that sub-section, for           the purposes  of y 46 or for any other purpose for           which such  use is  material under the 1958 Act or           any other  law. To  confine this fiction to a case           of an  actual use  of a trade mark by a registered           user is to confine it only to use for the purposes           of clause(b)  of 8.46(1)  which is contrary to the           purpose for  which the  fiction was  created  ant,           therefore,  when   8.18(1)   of   the   1958   Act           (corresponding to  8.14(1) of  the 1940  Act) uses

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         the words  "proposed to  be used, these words must           be read  as "proposed  to be  used by  a  proposed           registered user".           (2) To  register a trade mark which is proposed to           be used  by a  register d  user does  not  per  se           amount to  trafficking in  trade marks and whether           it does  so or  not must depend upon the facts and           circumstances of each case.           (3) The  reliance  placed by the High Court - both           by the  Single Judge and the Division Bench - upon           the ’PUSSY  GALORE’ Trade marks Case [1967] R.P.C.           265, was  unjustified and  unwarranted inasmuch as           the provisions  of the  English Trade  Marks  Act,           1938, are  radically different  from those  of the           1938 Act as also the 1940 Act and, therefore, that           case has  no relevance  80 far as the construction           of 8.18(1)  read with  8.48(2) of  the 1958 Act is           concerned.           (4) The reliance placed by the High Court (both by           the Single  Judge and the Division Bench) upon the           Shavaksha  Committee   Report  ant  the  Ayyanagar           Report was equally misplaced as Parliament did not           accept  the   recommendation   with   respect   to           registered users. 270           (5) The  facts and  circumstances of the case show           that the  appellant had, at the date of the making           of the  application for  registration, a bona fide           intention to  use the trade mark ’Dristan’ through           a registered user.           (6) In  any event,  the appellant  itself had made           bona fide  use of the trade mark ’Dristan’ up to a           date one  month  before  the  date  of  the  First           Respondent’s Application for Rectification.      On behalf of the First Respondent following contentions were made.           (1) The  words "proposed to be used" in 8.18(1) of           the  1958   Act  8.14(1)  of  the  1940  Act  mean           "proposed  to   be  used   by  the  applicant  for           registration, his  servants and agents" and not by           any person who is proposed to be got registered as           a  registered   user  and,  therefore,  the  legal           fiction enacted in 8.48(2) cannot be imported into           8.18(1).           (2) A  registered user  can only  come into  being           after a trade mark is registered. Therefore, as at           the date  of an  application for registration of a           trade  mark,   there  cannot   be  any  person  in           existence who  is a  registered  user.  The  words           "proposed to  be used"  cannot therefore  possibly           mean "proposed to be used by a proposed registered           user"           (3) To  permit a  trade mark to be registered when           the applicant  himself does  not propose to use it           but proposes  to use  it through  someone else who           would subsequently  be registered  as a registered           user would be to permit trafficking in trade marks           which is  contrary to  the policy  underlying  the           Trade Marks laws.           (4) The  only case  which the 1958 Act per its the           registration of  a trade  mark when  the applicant           for registration does not intend to use it himself           but intends  to use  it through another is the one           set out  in 8.45,  namely, where  the registrar is           satisfied that a company is about to be formed and

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         registered under  the Companies Act, 1956, and the           applicant intends to assign the trade mark to that           company with  a view  to the  use thereof  by  the           company. 271           (5) The  1958 Act  is, as  the 1940 Act was, based           upon   the English  Trade Marks Act, 1938, and the           decision in  the ’PUSSY  GALORE’ Trade  mark  case           (supra)   concludes   this   point   against   the           appellant.           (6)  The   Shavaksha  Committee   Report  and  the           Ayyangar Report show the legislative intent not to           allow a proposed use be a proposed registered user           to be equated with a proposed u e by the applicant           for registration.           (7)The appellant  had not  at any  relevant-  time           made use of the trade mark ’Dristan’.           (8)  The   appellant  had   fradulently   obtained           registration  of   the  trade  mark  ’Dristan’  by           stating in  the application  for registration that           it proposed  to use the said trade mark itself and           by not disclosing the fact that it proposed to use           it through a proposed registered user.           (9) The  trade mark  ’Dristan’ was deceptively and           confusingly similar  to the  trade  mark  ’Bistan’           and, therefore,  lt cannot be allowed to remain on           the Register of Trade Marks.           (10) to  allow the  trade mark ’Dristan’ to remain           on the Register of Trade Mark would be contrary to           the policy of the Government of India.      Allowing the appeal, ^      HELD :  (1) The  Judgment of  the Division Bench of the Calcutta High  Court appealed  against is  reversed and  the order passed by it is set aside. Appeal No.165 of 1968 filed by the  appellant before  the division Bench is allowed with costs and  the judgment and order of the Single Judge of the High Court  are reversed  ant set aside. As a result, Appeal No. 61  of 1965  filed by  the First  Respondent before  the Single Judge  of the  High Court is dismissed with costs and the  order  of  the  Registrar  of  Trade  Marks,  Calcutta, dismissing   the    First   Respondent’s   Application   for Rectification, No.CAL-17 is confirmed. 1341 B-C]      2. Before  a  person  can  make  an  application  under 8.46(1) to take off a trade mark from the Register he has to be a "person 272 aggrieved". Undisputedly, the first Respondent was a "person aggrieved" within  the meaning  of  8.46(1).  Section  46(1) provides for  two cases in which a registered trade mark may be taken off the Registrar in respect of any of the goods in respect of which it is registered. The first case is set out in cl.(a)  of 8.46(1)  and the second in cl.(b) of that sub- section. Before  cl.(a) can become applicable two conditions are to  be satisfied,  namely, (1)  that the  trade mark was registered without  any bona  fide intention  on the part of the applicant  for registration  that it  should be  used in relation to  those goods  by him, and (2) that there has, in fact, been  no bona  fide use of that trade mark in relation to those  goods by any proprietor thereof for the time being up to  a date  one month  before the date of the application under 8.46(1).  The only exception to the first condition is of a  case to  which the  provisions of 8.45 apply. Both the conditions in  cl.(a) are  cumulative and  not  disjunctive. Clause (a),  therefore, will  not apply  where even  though

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there has  been no  bona fide  intention on  the part of the applicant for  registration to  use the  trade mark  but, in fact, there  has been  a bona  fide use of the trade mark in relation to  those goods  by any  proprietor thereof for the time being  up to  a date  one month  before the date of the application under  8.46(1). Similarly, cl.(a) will not apply where, though  there had  been a  bona fide intention on the part of  the applicant  for registration  to use  the  trade mark, in  fact, there has been no bona fide use of the trade mark in  relation to  those goods  by any proprietor thereof for the time being up to a date one month before the date of the application under 8.46(1). [311 G-H; 312 A-E]      3. Clause (b) of s.46(1) applies where for a continuous period of  five  years  or  longer  from  the  date  of  the registration of  the trade mark, there has been no bona fide use thereof  in relation  to those goods in respect of which it is  registered by  any proprietor  thereof for  the  time being. An  exception to  cl.(b) is created by s.46(3). Under 8.46(3), the non-use of a trade mark, which is shown to have been due  to special  circumstances in  the trade and not to any intention  to abandon  or not  to use  the trade mark in relation to  the goods  to which  the  application  .  under s.46(1) relates,  will not amount to non-use for the purpose of cl.(b). [312 P-H]      4. The distinction between cl.(a) and cl.(b) is that if the period  specified in  cl.(b) has elapsed and during that period there  has been  no bona  fide use of the trade mark, the fact  that the  registered proprietor  had a  bona  fide intention to use the 273 trade mark  at the  date of the application for registration becomes immaterial  and the  trade  mark  is  liable  to  be removed from  the  Register  unless  his  case  falls  under 8.46(3), while under cl.(a) where there had been a bona fide intention  to  use  the  trade  mark  in  respect  of  which registration was  sought, merely  because the trade mark had not been  used for a period shorter than five years from the date of its registration will not entitle any person to have that trade mark taken off the Register. [313 A-B]      (5) Under both these clauses the burden of proving that the facts  which bring  into play  cl.(a) or  cl.(b), as the case may  be, exist  is on  the person who seeks to have the trade mark  removed from the Register. Thus, where there has been a non-User of the trade mark for a continuous period of five years and the application for taking Off the trade mark from the  Register has been filed one month after the expire of such  period, the  person seeking  to have the trade mark removed from  the Register has only to prove such continuous non-user and  has not  to prove  the lack  of  a  bona  fide intention on  the part  of the  registered proprietor to use the  trade   mark  at   the  date  of  the  application  for registration. Where,  however, the  non-user is for a period of less  than five  years, the person seeking  to remove the trade mark  from the Register has not only to prove non-user for the  requisite period  but has  also to  prove that  the applicant for  registration of  the trade  mark had  no bona fide intention  to use  the trade  mark when the application for registration was made. [313 C-E]      (6) The  definition of "trade mark" contained in cl.(v) of 8.2(1) shows that a trade mark is a mark used or proposed to  be  used  in  relation  to  goods  for  the  purpose  of indicating or  so as  to indicate a connection in the course of trade  between the goods and some person having the right to use  the mark.  It is,  therefore, not necessary for the purpose of  registering a trade mark that those goods should

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be  in   existence  at  the  date  of  the  application  for registration. If the position were that the mere non-user of a trade  mark for  the period mentioned in cl.(a) of 8.46(1) would make a trade mark liable to be taken off the Register, it would  result in  great hardship and cause a large number of trade  marks to be removed from the Register, because the c one  month has  elapsed, after the registration of a trade mark had been ordered, a trade rival can make an application on the  ground set  out in  cl.(a) of  8.46(1) claiming that there has  been no  bona fide  w e of the trade mark up to a date one  month before the date of his application. It is in order to  revent such  harassment and absurd result that the two  conditions   specified  in   cl.(a)  have   been   made cumulative. [313 F-H; 314 A-C] 274      (7)  The   object  underlying  8.46(1)  is  to  prevent trafficking in  trade marks.  This is,  in fact,  the object underling all  trade mark  Laws. A  trade mark  is meant  to distinguish the  goods made  by one  person fro  tho made by another. A  trade mark, therefore, cannot exist in vacuo. It can only  exist in  connection with the goods in relation to which lt  18 used  or intended  to be used. Its object 18 to indicate a  connection in  the course  of trade  between the goods and  some person  having the  right to  use  the  mark either with  or without  any indication  of the  identity of that person.  when a  person gets his trade mark registered, he acquires  valuable rights by reason of such registration. Registration of his trade mark gives him the exclusive right to the use of the trade mark in connection with the goods in respect of  which it  is registered  ant  if  there  18  any invasion of  this right  by any  other person  using a  mark which is  the same or deceptively similar to his trade mark, he can  protect his  trade mark by u action for infringement in which  he can obtain injunction, damages or an account of profits  mate  by  other  person.  In  such  an  action  the registration of  a trade mark is prima facie evidence on its validity. After  the expiry  of seven years from the date of the registration,  a trade  mark  is  to  be  valid  in  all respects except  in the  three cases  set out  in 8.32.  The proprietor of  an unregistered  trade  mark  whose  mark  is unauthorisedly used  by another cannot, however, use for the infringement of  such trade  mark. His  only remedy  lies in bringing a  passing-off action,  an inconvenient  remedy  as compared to an infringement action. [314 C-H; 315 A-B]      7(i) In a passing-off action the plaintiff will have to prove that  his mark has by user acquired such reputation as to become distinctive of the plaintiff’s goods 80 that if it 18 used  in relation  to any goods of the kind dealt with by the plaintiff, it will be understood by the trade ant public as meaning that the goods are the plaintiff’s goods. [315 B- C]      7(ii) In  an infringement  action, the plaintiff is not required to prove the reputation of his mark. Further, under 8.37 a  registered  mark  is  assignable  and  transmissible either with  or without  goodwill of  the business concerned while  under   8.38,  an  unregistered  trade  mark  is  not assignable or  transmissible except  in the  three cases set out in 8.38(2). [315 C-D]      (8)  As  the  registration  of  a  trade  mark  confers valuable rights  upon the  registered proprietor  thereof, a person cannot  be permitted to register a trade mark when he has not used it in relation to the goods in respect of which it sought  to be  registered  or  does  not  intend  to  use relation to such goods. [315 D-1] 275

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    Batt’s case, (1898) 2 Ch-D 432, 436; s.c.15 R.P.C. 262, 266, (1898) 2 Ch. D. 432 at pages 439-442, sub nominee Johan Batt &  Co. v. Dunnett and another, (1899) A.C. 420; s.c. 16 R.P.C. 411 relied upon.      (9)  To   get  a  trade  mark  registered  without  any intention to  use lt  in relation to any goods but merely to make money  out of  it by selling to others the right to use it would  be trafficking  in that trade mark. If there is no real trade convection between the proprietor of the mark and the licensee  or his goods, there is roam for the conclusion that the  grant of the licence is a trafficking in the mark. It is  a question of fact and degree in every case whether a sufficient trade connection exists. [316 A-B; 317 A-B]      Re American Greetings Corp.’s Application, [1983] 2 All E.R. 609 & 619 [1984] 1 All E.R. 426, 433 relied upon.      (10) The  intention to  use a  trade mark  sought to be registered must  be genuine  and real  and the fact that the mark was  thought to  be something  which some  day might be useful  would   not  amount  to  any  definite  ant  precise intention at  the time  of registration  to use  that  trade mark. The  intention to  use the mark must exist at the date of  the   application  for  registration.  Section  46(1)(a) expressly speaks  of "bona fide intention on the part of the applicant for  registration. which  would mean  "at the date when such applicant makes his application for registration." [317 C-E]      In re Ducker’s Trade mark (1928) Ch.1 405, 409 referred to.      (11) Intention  is a  state of mind. No person can make out the  state of  mind or  any other  person- None the less courts  are  often  called  upon  for  various  purposes  to determine the  state of  a person’s mind. The court can only do to  by deducting  the existence  of a particular state of mind from the facts of a case. [317 B; 318 A]      (12) In  the instant  case, in  order to  ascertain the intention  of  the  appellant  at  the  date  of  filing  of application for  registration the  facts could be summarised with reference to three periods: (1) events which took place upto the  date of  the application for registration, namely, August 18, 1958, (2) events which happened between that date and the  date of Application for Rectification, namely April 10, 1961 and (3) events which happened subsequently to April 10, 1961. [320 D-E] 276      12(1) Prior  to 1956,  the  appellant  had  acquired  a substantial shareholding  to the  extent of  40 percent  the Indian Company.  In 1956  the appellant introduced ’Dristan’ tablets in  the American  market  and  got  the  trade  mark ’Dristan’ registered  in the United States of America and in several other countries. technical collaboration between the Appellant and  the Indian  Company commenced  from  Nov.  1, 1957, and  an agreement in that behalf was signed on May 16, 1958. In  pursuance of  the said collaboration agreement the Indian Company  manufactured and markets several produced of the appellant.  The appellant got registered its trade marks in respect  of such  products and  the  Indian  Company  was registered as  the registered  were in respect of such trade marks. As  early as  December 1557,  it was decided that the Indian Company  should introduced  in the Indian market nine new products  of the  appellant including ’Dristan’ tablets. On August  18, 1958,  the appellant filed an application for regls tratlon of the trade mark ’Drlstan’ and the said trade mark was tuly registered on June 8, 1959. [320 FiH; 321 A]      12(ii) During  the period  between August 18, 1958, and the  date   of  the  First  Respondent  is  Application  for

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Rectification, that  is April  10, 1961  the Indian  Company applied for  and obtained  a licence  for the  purchase of a Stokes Triple  Layer  Machine  for  manufacturing  ’Dristan’ tablets and  when the said machine was received installed it at  its   Ghatkoper  factory.  It  also  obtained  from  the appellant three  units of  ’Dristan’ tablets  as samples and the  manufacturing  manual  for  the  tablets.  Further,  lt applied  to   the  Central  Government  under  8.11  of  the Industrials (Development  and regulation)  Act, 1951,  for a licence to  manufacture ’Dristan’  tablets which was granted to lt. It also applied for and obtained a licence to import certain ingredients  used in  the manufacture  of  ’Dristan’ tablets and  imported such   ingredients. It further applied for  and   obtained  from   the  Director,   Drugs   Control Administrating   State   of   Maharashtra,   permission   to manufacture ’Dristan’  tablets. The  appellant also  filed a notice of  opposition to  the First  Respondent’ Application for registration of their mark ’Tristine’. [321 H; 322A-C]      12(iii) During  the  period  subsequent  to  the  First respondent’s  Application   for   Rectification,   that   is subsequent to  April 10,  1961,  on  October  18  1961,  the registered user  agreement  was  entered  into  between  the appellant and  the Indian  Company. On  October 22, 1961 the ’Dristan’ tablets were first marketed in India by She Indian Company. On  March 6,  1962, the  appellant and  the  Indian Company jointly  made an  application to register the Indian Company as  a registered  user of  the trade mark ’Dristan’. [322 C-E] 277      12(iv) The  facts set  out above clearly show that each of them  is an integral link in a chain and that they cannot be divided  into three  separate periods.  m  is  continuous chain of  events establishes beyond doubt that the appellant had an  intention that  the trade  mark ’Dristan’  should be used  in   relation  to  the  tablets  in  question  by  the manufacture and sale of these tablets in India. [322 E-F]      (13) The  appellant’s application  for registration  of the trade  mark ’Dristan’ was made under 8.14(1) of the 1940 Act and  was registered  under the Act. Under 8.14(1) only a person claiming to be the proprietor of a trade mark used or proposed to  be used  by him could apply for registration of that trade  mark. The  provisions of 8.18(1) of the 1958 Act are identical. [323 F-G]      (14) If  the 1940  Act did  not contain a legal fiction similar to  that enacted  in s.48(2)  of the  1958 Act,  the appellant’s case  would fall  to the  ground because then at the date  of its  application for  registration of  the said trade mark,  its intention would be not to use it itself but to use  it through another. The 1940 Act, however, also made provisions with  respect to  registered users  and created a similar legal fiction in 8.39(2) of that Act. [325 A-B]      (15) The only difference between 5.392) of the 1940 Act and s.48(2)  of the 1958 Act is that while under 8.39(2) the legal fiction  created by  it applies  "for any  purpose for which such use is material under this Act or any other laws, under s.48(2) the legal fiction applies "for the purposes of s.48 or for any other purpose for which such use is material under this  Act or any other laws. The addition of the words "for the  purposed of  8.46" in  8.48(2) does  not make  any difference  but  clarifies  the  scope  of  the  said  legal fiction. Clause  (a) of  s.48(1) refers  both to  bona  fide intention on the part of the applicant for registration that the trade  mark should be used in relation to those goods by him as  also to  bona fide use of the trade mark in relation to those goods by any proprietor thereof for the time being.

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It cannot  possibly be  that when 8.48(2) expressly provides that the permitted user f a trade mark by a registered user is to  be deemed  to be  user by the proprietor of the trade mark for  the purposes cf s.48, the fiction is intended only to apply  to the  use of  the trade  mark referred to in the second condition  of cl.(a) of 8.46(1) and not to the use of that trade  mark referred  to  in  the  first  condition  of cl.(a). Under  8.18(1), on application for registration of a trade mark can only be made 278 by a  person who  claims to  be the proprietor of that trade mark. Therefore,  the words  applicant for  registration" in cl.(a) of  s.48(1) would mean "the person claiming to be the proprietor of  the trade  mark  who  is  the  applicant  for registration of  that trade  mark". The  first condition  of cl.(a) would,  therefore, read  "that  the  trade  mark  was registered without  any bona  fide intention  on the part of the person  claiming to be the proprietor of that trade mark who has made the application for registration that it should be w  ed in  relation to those goods by him." So read, there can be  no difficulty  in reading the words "by him" also as "by a  registered user".  Similarly, the  legal  fiction  in .48(2) can  also be applied to 8.18(1). S.18(1) in the light of the  legal fiction  would read as "any person claiming to be the  proprietor of  a trade  mark used  or proposed to be used by  him or  by a  registered user".  By reason  of  the provisions of  8.39(2) of  the 1940  Act, 8.14  of that  Act should also be read in the same way. [325 B-U; 326 A-D]      East  End   Dwellings  Co.  Ltd.  v.  Finsbury  Borough Council, (1952)  A.C.109 &  state  of  Bombay  y.  Pandurang Vinayak Chaphalkar and Or., [19531 S.C.K. 773 relied upon.      (16) The  purposes  for  which  the  fiction  has  been enacted are  set out  in 8.48(2).  These  purposes  are  the purposes of  8.46 or  for any  other purposes for which such use is  material under  the 1958  Act or  any other  law. To confine the  purpose only  to a  part of  8.46 would  be  to substantially cut  down the  operation of the legal fiction. The purpose for which the legal fiction is to be resorted to is to  deem the  permitted use  of a trade mark, which m the use of  the trade  mark by  a registered user thereof, to be the use by the proprietor of that trade mark. [327 A-B]      (17) Section 17(1) of the English Trade Marks Act, 1938 (1 & 2 Geo, 6, c.22) sets out who can apply for registration of a  trade mark  and is in pari materia with 8.18(1) of the 1958 Act.  Under s.17(4),  the refusal  by  a  Registrar  to register the trade mark is subject to appeal to the Board of Trade or to the Court at the option of the applicant. If the appeal is  to the  Court, there can be further appeal to the Court of  Appeal ant  from there  to  the  House  of  Lords. Section 26  provides for  removal of  a trade  mark from the Register and  is in  pari materia with 8.46 of the 1958 Act. Section 32 teals with rectifying the entries in the Register and is analogous to 8.56 of the 1958 Act. [327 E-F]      (18) Under 8.87 of the Patents, Desings and Trade Marks Act, 1883  (46 &  47 Vict.  c.57), any registered proprietor could grant  licences to use the mark subject to any equity. The 1883 Act in 279 so far  as it  rel ted  to Trade  marks was  repealed by the Trade   marks Act,  1905 (5  Edw. 7  c.15). The 1905 Act did not, however, contain any power in the registered proprietor to  grant  licences.  the  English  Act  of  1938,  however, introduced a system of official approval for licences to use a trade  mark particularly  by providing  for registering  a person other  than the  proprietor of  the trade mark as the

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registered user of the trade mark. [327 G-H; 328 A]      (19) The  High Court  was  unduly  impressed  by  Pussy Galore Trade  mark case  and  unnecessarily  attached  great importance to  it. The  High Court  was justified in relying upon that  case by  referring to  the case  of Ashok Chander Rakhit  Ltd.,  [1955]  2  S.C.R.  252  but  the  High  Court overlooked  that  in  Ashok  Chander  ’Rakhit’s-  case  the section of  the 1940  Act which  fell for interpretation was not in  pari materia  with the  corresponding section of the English Act of 1938 which had been judicially interpreted by the courts in England. [332 E-E]      The Registrar  of Trade  mark v.  Ashok Chandra   LTD., [1955] 2 S.C.R. 252 referred to.      (20) In  the absence  of any  binding authority  of  an Indian Court on a particular point of law, English decisions in which  judgments were  delivered by  judges held  in high repute can be referred to as they are decisions of courts of a country  from which  Indian Jurisprudence and a large part of Indian  Law 18  derived, for they are authorities of high persuasive value  to which  the court  may legitimately turn for assistance;  but whether  the rule  Laid down  in any of these case can be applied by Indian courts lust, however, be judged in the context of Indian laws and legal procedure and the practical  realities of litigation in India. [332 H; 333 A-B]      Forasol v.  011 and  Natural Gas  Commission, [1984]  1 S.C.R. 526, 549, 567; S.C. [1984] Supp. S.C.C. 263, 280, 295 referred to.      (21) The  relevant provisions  relating  to  registered users IN  the English Act and IN the 1958 Act are materially different. The  English Act creates two legal fictions". The first is contained in 8.28(2) which relates to the permitted w e of a trade mark. That fiction is for the purpose of 8.26 (Which correspond to section 46 of the 1958 Act) and for any other purpose  for which  such use  is  material  under  the English Act  o-r at  common law.  The second 1- contained in s.29(2) and relates to 280 intention on  the part of an applicant for registration that a trade  mark should  be used  by him. The second fiction 18 for  the   purposes  of   paragraph(a)  of   8.26(1)   which corresponds to  cl.(a) of  s.46(1) of the 1958 act. The 1958 Act, however,  contains only  one fiction. It is in 8.48(2), which 18  in pari  material with s.28(2) of the English Act. The   omission   from   the   1958   Act   of   a  provision similar   to  that   contained   in    8.29(2)    of     the English Act  does not make any difference if one were to see 6- (2)  in its  proper setting  and contest. The English Act does not  prescribe, just  as the  1958 Act  does  not,  any period of tile from the date of registration of a trade mark within which an application for registering of a person as a registered user  of that  trade mark should be made. Section 29(1)  of   the  English  Act,  however,  provides  that  an application  for   registration  of  a  trade  mark  can  be accompanied by  an application  for there  registration of a person as  a registered  user of  that trade  mark’,  if the tribunal is  satisfied that the proprietor of the trade mark intend it  to be  used by  that person  in relation to those goods and  is also  satisfied that person will be registered ns a  registered user  thereof after the registration of the trade mark,  it will  not refuse to register the trade mark. The effect of 8.29(1), therefore, is that an application for registering a  person as  a  registered  user  can  be  made simultaneously with  the  application  for  registering  the trade mark  and if  both are  found to  be satisfactory, the

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application  for   registration   would   be   granted   and immediately thereafter  the registration  of the  registered user would  be allowed. In such a case, the intention on the part of  the applicant  for registration that the trade mark should be  used by  the registered  user thereof  is  to  be deiced to  be an  intention to  use that  trade mark  by the applicant for  registration. This  is  a  special  provision applicable to a special case. The fiction created by s.29(2) 18 also  made applicable  to the case of a corporation above to be  constituted to  which the applicant intends to assign the trade  mark.  There  is  no  such  fiction  relating  to intention expertly  provided in  the 1958  Act, nor is there any provision  for simultaneously  making an application for registration of  a  trade  mark  and  an    application  for registering a  person a  the registered  user of  that trade mark. The  purpose for  which  the  fiction  was  created  y 8.29(2) the  respect to  a registered  user was to eliminate all possibility  of trafficking  in a trade mark by a person getting himself registered as the proprietor of a trade mark and there  after going in search of so the person who will w e it as the registered user thereof. If the existence of the special  fiction  created  by  5.29(2)  cuts  down  he  full operation of the general fiction enacted in s. 28(2), it 281 does not  follow that the absence of such special fiction in the 1958 Act will also cut down the operation of the fiction in s.48(2)  in the same way by limiting it to the actual use of a  trade mark  only. In  the 1958 Act wherever the phrase "used by  him occurs the fiction will apply. In other words, the permitted use of a trade mark is, by the fiction enacted in s.48(2),  equated with  use by the registered proprietor- Consequently  wherever  the  word  e  occurs  with  all  its permutations and  commutations, as  for instance  in phrases such as proposed to be used be him or intended to be used be in, the  fiction will  apply. Form No.TM-2, which is the for prescribed for  an application  for registration  of a trade mark prescribed by the English  Trade Marks Rules, 1938, was substituted in  1982 and  under the  substituted From  a new column is  provided which requires details of an application under s.29(1)  to be  given. The  old Form  No.TM-2 did  not contain this  requirement nor does Form TM-1 appended to the Trade and Merchandise Mark rules, 1959 [333 B-H; 334 A-G]      (22) Under the 1958 Act an application for registration of a  trade mark  ad also  an application  for registering a registered user  are to  be made  to the Registrar and it is the Registrar  who has  to grant both of them. The Registrar would refuse  the application  if lt appears to him that the grant thereof  would tend  to facilitate  trafficking  in  a trade mark.  this  question  is  to  be  considered  by  the Registrar himself.  provisions of the 1940 Act were the same but the  provisions of the 1958 Act are radically different. Under  the   1958  Act,  though  both  the  application  for registration  of  a  trade  mark  and  the  application  for registration of  registered user  are  to  be  made  to  the registrar,  the   Registrar  has  the  power  to  grant  the application for  registration of the trade mark only. So far as the  application for registering a person as a registered user is  concerned, he  has to  forward lt together with his report to  the Central  Government and  it for  the  Central Government to  decide whether  to permit such application to be granted  or Lot-  in order  to decide  this, the  Central Government or  to take  into account  the matters set out in subs-s.(3)   of .49  and on rule 85 of the Trade Marks Rules 1959. The  matter to be considered by the Central Government include not  only whether  the permitted  use,  if  allowed,

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would about  to trafficking  in  trade  mark  but  also  the interested of  the general public and the development of any industry, trade  or commerce  in India.  After  the  Central Government has  taken  its  decision  the  Registrar  is  to dispose of the application in accordance with the directions issued by  the Central  Government.  Thus  while  under  the English Act the authority to decide an 282 application for registering a registered user is the same as the authority  for registering  a trade mark, under the 1958 Act they  are different  and 80 are the considerations which are to be taken into account. [334 h; 335 A-E]      (23) Under  the 1958 Act an application for registering a registered  user can  only be  made after  a trade mark is registered. If  an intended  use by  a person  who  will  be registered as a registered user is not to be included in the legal fiction  created by  section 48(2), it would make that fiction operate  within a  very  narrow  compass  an  almost render  the   provision   relating   to   registered   users meaningless. It  16 in very rare circumstances that a person will get  a trade  mark registered as proposed to be used by himself, use  it in  relation to  the concerned  goods,  and thereafter permit  it to  be used by another as a registered user. It  is also not open to everyone who wants to register a trade  mark to for a company to which after the trade mark is registered  and the proposed company is incorporated, the trade mark  will be assigned. These things are not practical realities and Parliament could not have intended such absurd results. 1335 F-H]      (24) It is not necessary that the appellant should have got the  trade mark  registered with  the intention  that it will itself  use the  trade mark  and in order to effectuate that intention  the appellant  should have  set up a factory and manufactured and marketed the tablets ’DRISTAN’ and then either assigned  the trade  mark to the Indian Company or to get the  Indian Company registered as the registered user of that  trade   mark.  By   reason  of  foreign  exchange  and industrial policies  in India  it  is  not  possible  for  a foreign company  to establish its own industry India. It can only do  so by  entering into  a collaboration  with  Indian entrepreneurs in  which the  foreign company  would  not  be permitted to  have more  than 40  per cent  shareholding and would be  subject to  other restriction.  Even if  a foreign proprietor of  a trade mark were to establish an industry of his own  in India,  it would  be absurd  to imagine  that it would thereafter  cease manufacturing  the goods  and  allow someone else  to do  80. It  is equally  illogical that  the appellant and the Indian Company should have jointly applied for registration  of the trade mark ’DRISTAN’. The appellant was already  in collaboration with the Indian Company. There was no  need for it to seek other collaborators to establish a new  company. To  assign the  trade  mark  to  the  Indian Company or  to make  jointly  with  the  Indian  Company  an application for  registration of  the trade  mark  ’DRISTAN’ would be  to destroy  the appellant’s proprietorship in that trade nark. [336 A-D] 283      (25) It  is a well-known principle of interpretation of statutes that  a construction  should  not  be  put  upon  a statutory provision  which would  lead to manifest absurdity of futility,  palpable injustice, ox absurd inconvenience or anomaly. While  placing construction  on 6.48(2),  the  High Court did not apply this principle and failed to give to the legal fiction  enacted by 8.48(2) its full force and effect. [336 E-F]

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    ’BOSTITCH’ Trade  Mark (1963)  R.P.C.  183  and  ’PUSSY GALOK’ Trade Mark, 119671 R.P.C. 265 inapplicable.      (see: -  Beneath and  Ore. v. Muddala Veeramallappa and Ck.) [1961] 2 S.C.R. 295, 303 referred to.      Aston v.  Harlee Manufacturing  company, (1959-60)  103 C.L.R. 391 relied upon. (26) The  Parliament did  not accept the recommendation made in Shavakasha  Committee Report  and Ayyanagar Report. These Reports, therefore,  cannot be  referred to for ascertaining the intention  of  Parliament  when  enacting  the  relevant provisions of 1958 Act. [337 G]      (27) In  the instant case, the facts on the record show that only when it was decided to introduce ’DRISTAN’ tablets in the  Indian market  through the  Indian Company  that the appellant made  its application  to register  the trade mark ’DRISTAN’. There  was a  close connection  in the  course of trade between  the appellant  and the  Indian  Company.  The appellant owned  40 per  cent of  the shareholding  in  the Indian  Company.   It   had   entered   into   a   technical collaboration  agreement   with  the  Indian  Company  which provided for  strict quality  control and  for formulae  and services to  be provided  by the appellant. The manufacture, marketing  and   advertising  of   all  products  under  the agreement were  to be  under the  control of  the appellant. There was  no royalty  payable by  the Indian Company to the appellant in respect of the use of the trade mark ’DRISTAN’. In the event of the collaboration agreement being terminated by reason of the happening of any of the events mentioned in the agreement,  amongst which events was the shareholding of the appellant  becoming less  than 40  per cent,  the Indian Company was  to cease  to be  entitled  to  manufacture  the tablets ’DRISTAN’. There was here, therefore, no question of any trafficking in a trade mark. In these circumstances, the intention of  the appellant  to use the trade mark ’DRISTAN’ through the  Indian Company  which was  subsequently to  get itself registered  as the  registered user of the said trade mark cannot  but be characterised as bona fide. [338 Lr; 339 A] 284        (28)  The two  conditions of  cl-(d) of  8-46(1)  are cumulative and  since  the  first  condition  has  not  been satisfied in  this case,  it la  unnecessary to consider the question whether  the appellant  had in addition to having a bona fide intention to use the trade mark ’Dristan’ had also used it  within a  period of  one mouth  before the  date of Application for Rectification. 339 A-C]

JUDGMENT:      CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2159 of 1970      From the  Judgment and  Decree dated  16.12.69  of  the Calcutta High Court in Appeal No. 165 of 1968.      F.S. Nariman,  J.I. Mehta, Michal Fysh, T.M. Ansari, V. Tulzapurkar, C.M.  Maniar, Ashok Sagar, Aditia Narayan, Alok Vidyalankar and D.N. Misra for the Appellant.      Dr.V.  Gouri   Shankar,  K.L.   Hathi,   Manoj   Arora, Narendrabhai Zaveri,  Ms. Malati  Jhaveri and  Vijay F. Shah for Respondent No.l.      Ex-parte for Respondent No. 2.      T.U. Mehta and V. Dave for Intervener.      The Judgment of the Court was delivered by      MADON, J.  This Appeal  has been  filed pursuant  to  a certificate granted  by the  Calcutta High Court against its

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judgment and  order dated December 16, 1969, in Appeal . 165 of 1968.  The certificate  has been  given by the High Court under sub-clause  (a) and  (c) of  clause (1) of Article 133 prior to the substitution of that clause by a new clause (1) by the  Constitution (Thirtieth  Amendment) Act,  1972.  The grounds on which the certificate has been given are (i) that the value  of the  subjectmatter in  dispute in the court of the first instance and still in dispute on appeal was and is not less  than Rs.20,000  and that as the judgment in appeal was one  of affirmance,  the appeal  involves a  substantial question of  law, and  (ii) that  the case was a fit one for appeal to the Supreme Court. The High Court obserbed:           The appeal  raises a  question of great importance           in Trade  Marks Law,  that is  to  say  whether  a           proprietor 285           of a  trade mark who intends to use it solely by a           registered- user  is entitled  to registration  of           his   trade mark,  under Sec. 18 of the Trade Mark           Act, or  to  put  it  differently,  do  the  words           ’proposed to  be used  by him’  in  Sec.  18  mean           ’proposed to  be  used  by  the  proprietor,  his           agents  and   servant’  only....   The  case  also           involves the  question  of  construction  of  sub-           section (2)  of Sec.  48 and  consideration of the           effect of  that sub-section  on sub-section (1) of           sec. 18  of the  Trade and  Merchandise harks Act,           1958. The questions  so posed by the High Court resolve themselves into the following two questions :           (1) Whether  a proprietor  of  a  trade  mark  who           intends to  use it  solely by a registered user is           entitled to  registration of high trade mark under           section 18 of the Trade and Merchandise Marks Act,           1958 ?           (2) Whether  by reason  of the  provisions of sub-           section  (2)  of  section  48  of  the  Trade  and           Merchandise marks Act, 1958, the words proposed to           be used by him in sub-section (1) of section 18 of           the said  Act mean  proposed to  be  used  by  the           proprietor, his  agents and  servants only  or  do           they also  include a  proposed user by someone who           will get himself registered under section 48(1) of           the said Act as a registered user? The High Court further observed :           The  matter   is  of  considerable  importance  to           foreign proprietors  of trade marks, to registered           users  of  trade  marks  in  general  and  to  the           Industry and Commerce at large.      Before embarking on a discussion of the above questions it will  be convenient  to relate first the facts which have given rise to this Appeal.      The Appellant, American Home Products Corporation, is a multi-national corporation  incorporated under  the laws  of the State  of Delaware  in the United States of America. One of the  activities of  the appellant  is the manufacture and marketing of pharmaceutical products and drugs. The division of the Appellant 286 which at  all relevant times carried on and still carries on this  activity   is  called  the  Whitehall  Laboratories  . Geoffrey Manners  & Co. Ltd. (hereinafter referred to as the Indian Company ) is a company registered as a public limited company under  the Indian  Companies Act,  1913,  and  is  a public company  within the  meaning of  the  Companies  Act,

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1956. Home  Products International Limited is a wholly owned subsidiary of  the  Appellant  and  at  all  material  times represented the  Appellant  in  its  dealings  with  foreign distributors, licences and subsidiaries. In the present case the said  Home Products International Limited had carried or correspondence on  behalf of  the Appellant  with the Indian Company. International  Chemical Company  Limited is another wholly owned subsidiary of the Appellant. Some time prior to 1956, the  Appellant acquired  a substantial shareholding to the extent of 40 per cent in the Indian Company. In 1956 the Appellant introduced  an anti-hystamin  drug in the American market under  the trade  mark ’DRISTAN’ for the treatment of respiratory ailments  in the  form of  a decongestant tablet for  symptomatic   relief  for   cold  and  congestion.  The Appellant got  the trade  mark  ’DRISTAN’  registered  as  a distinctive trade  mark in  the Trade  Marks Register in the United States  and subsequently thereto between 1957 to 1961 in  about   39  other  foreign  countries.  These  countries included Great  Britain, Ireland,  Belgium, Denmark, France, Holland and  other countries  in the  Continent  of  Europe, Canada, Mexico, and several countries in south America, Asia and Africa.      By an  agreement signed on May 16, 1958, effective from November 1,  1957, the  Appellant entered  into a  technical collaboration  agreement   with  the   Indian  Company.  The recitals of  the said  agreement are  material  and  may  be reproduced. They read as follows :           WHEREAS,  American   Home   Products   Corporation           directly or  through its wholly owned subsidiaries           is one  of the  leading  American manufacturers of           drugs,  pharmaceuticals,   biologicals,  vaccines,           antibiotics,    nutritionals     and     medicinal           preparations  and   conducts  continuously  active           research  in  its  various  Laboratories  for  the           discovery  of  new  and  improvement  of  existing           therapeutic products, and           WHEREAS,  American   Home   Products   Corporation           prepared to  provide Geoffrey Manners on the terms           and conditions  of this Agreement the formulae and           manufacturing technology and other assistance 287           essential for  the efficient  manufacture in India           of   various American  home  Products  Corporation           products, and           WHEREAS, Geoffrey Manners has access to and use of           lands  and   buildings  and  has  the  experience,           facilities,  equipment  and  personnel  needed  or           desired  for   successful  production,   sale  and           distribution of  the  aforementioned  products  in           India. The said  agreement related  to  two  classes  of  products, namely, Whitehall  Products  and  Whet  Products  .  We  are concerned in  this Appeal  with Whitehall Products. m e term "Whitehall Products’  was defined  in the  said agreement as meaning  all  formulations  owned  by  or  whose  sales  are promoted  under  the  direction  of  Whitehall  Laboratories Division  of   American   Home   Products   Corporation   or International   Chemical    company   Limited    which   are manufactured and  sold under  the name  or  trade  marks  of Whitehall Laboratories  Division of  American home  Products Corporation or  International Chemical  Company Limited  and packaged in  form for  sale and distribution by the trade to the ultimate  costumer .  The term  "Licensed" Products  was defined in  the said  agreement as  meaning those  Whitehall Products whose  import, manufacture, sale or distribution in

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India by Geoffrey Manners are licensed under and pursuant to the terms  of this  Agreement.  These  shall  include  those identified in  Schedule a  annexed hereto  and made  a  part hereof. Schedule  A to  the  said  agreement  set  out  four products,  namely,   ’Anacin’,   ’Kolynos’   Dental   Cream, ’Bismag’, and  ’Anne French’  Cleansing Milk.  ’DRISTAN’ was thus not  mentioned in  the said  Schedule A. Under the said agreement, the  Appellant agreed  to furnish  or cause to be furnished to the Indian Company the manufacturing technology and other assistance essential for the efficient manufacture by the  Indian Company  of inter  alia the Licensed Products and further  agreed that  qualified employees  of the Indian Company may visit the laboratories, PLANTS and facilities of the Appellant  to observe  and learn for the period required to obtain  the necessary  working knowledge, the methods and equipment for  the production  of the  Licensed Products and that qualified members of the appellant would be assigned to discuss  such  method  and  equipment  with  such  qualified employees of  the Indian  Company during the period of their visits. The  Indian company  likewise agreed  that qualified employees of  the  appellant  may  visit  the  laboratories, plants and  facilities of  the Indian  Company in  order  to observe and  examine the  methods  being  employed  and  the equipment being 288 used for the Licensed Products. The Appellant further agreed to supply  to the  Indian company  a written  description of each  process   utilized  for  the  production  of  Licensed Products including  flowsheets of  processes, necessary test methods and basic specifications for apparatus and equipment unitized in production and that thereafter the Appellant and the Indian  Company  should  furnish  each  other  with  all significant information  which either  of them developed and was  free   to  disclose   concerning  improvements  in  the processes  and   in  the   equipment,  raw   materials   and intermediates used  therein.  It  was  further  agreed  that before making  any offer to a third party or contracting any commitment with a third party for the purpose of manufacture and sale  in India  of any Whitehall Products, the Appellant would offer  to the  Indian Company,  upon the  thermic  and conditions set  out in  the said  agreement,  the  right  to manufacture, sell  and/or distribute such products in India. In the  event of  such offer  being accepted  by the  Indian Company in  respect of  any Whitehall  products such product would be  deemed a  Licensed Product for the purposes of the said agreement. During the period of the said agreements the Indian Company agreed not to manufacture, distribute of sell any new products whose production or sale would compete with the production and sale of the Licensed Products except with the prior  consent  thereto  in  writer  obtained  from  the Appellant, and  the Appellant  granted to the Indian Company for the duration of the said agreement an exclusive and non- transferable license  to make and sell the Licensed Products in India  under the  name or  marks which for these purposes the Appellant  would design or cause to be designed for such products. Clause  (a) of  Article IV  of the  said agreement inter alia  provided that  Rights of registered user will be extended to  Geoffrey Markers  in respect  of each  Licensed Product by  the proprietor  of such  trade mark  .  Furthers under the said agreement the Appellant was to furnish to the Indian Company  the manufacturing  technology applicable  to each Licensed  Product and to provide reasonable engineering and  technical   assistance  and   instructions   to   those representatives of  the Indian Company who were to direct or supervise the  manufacture of  such products  and who  would

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visit  the   Appellant’s  plants  for  such  assistance  and instructions.  The   advertising  expenditures,   plans  and budgets for  each fiscal  year with respect to each Licensed Products was  to be determined annually and approved by the Appellant and  the selection, appointment of all advertising agencies by  the Indian  Company for  promoting the sale and distribution of  the  Licensed  Products  was  to  have  the previous agreement  in writing  of the  Appellant. The  said agreement also sat out in detail the various 289 services which  were to  be rendered by the Appellant to the Indian Company.  The said agreement was to continue in force for an  indefinite period  of time  subject  to  its  sooner termination in the event of any of the eventualities set out in the  said agreement  taking place, one of them being that of the  Appellant ceasing to be the owner of at least 40 per cent of  the issued  and outstanding  share capital  of  the Indian Company.  The  said  agreement  contained  a  secrecy clause and  upon the  termination of the said agreement, the Indian  Company   had  to   return  to   the  Appellant  all manufacturing technology  received by  it from the Appellant and not to make any use of it thereafter.      In pursuance  of the  said collaboration  agreement the Indian  Company   manufactured  and  marketed  the  products covered  thereunder   and  got   itself  registered  as  the registered user  in respect  of the  trade marks relating to the said  goods of  which the  Appellant was  the registered proprietor. The  correspondence on  the record shows that on and from  December 1957  it  was  decided  that  the  Indian Company should  introduce in  the  Indian  market  nine  new products of  the Appellant  including ’DRISTAN’  tablets. On August 18,  1958, the  Appellant filed  an application under section 14(1)  of the  Trade Marks  Act, 1940  (Act No. V of 1940) in  the prescribed  form T-I  for registration of the trade  mark   ’DRlSTAN’   in   class   5   (which   includes pharmaceutical substances)  as a  medicinal preparation  for treatment  of   respiratory  ailments  claiming  to  be  the proprietor of  the said  mark by  whom  the  said  mark  was proposed to be used. The said application was advertised as required by  the Trade  Marks  Rules,  1942.  No  notice  of opposition to  the registration  of the  said trade mark was filet by  anyone and the trade mark ’DRISTAN’ was registered by the  Registrar of  Trade Marks,  Bombay, as Trade Mark No 186511 in class 5 on June 8, 1959. With effect from November 25, 1959,  the Trade  marks  Act,  1940,  was  repealed  and replaced by  the Trade  and Merchandise Marks Act, 1958 (Act No. 43 of 1958).      Thereafter the  Indian Company applied for and obtained a licence  for the purchase of a Stokes Triple Layer Machine which could produce two-layered tablets, the intention being to  use  this  machine  for  the  purpose  of  manufacturing ’DRISTAN’ tablets. The Indian Company intimated this fact to the Appellant asking it to supply urgently the manufacturing manual for ’DRISTAN’ tablets. The Indian Company also wrote to the  Appellant asking  lt to  supply free  of cost  three units (comprising  twenty four  tablets in all) of ’DRISTAN’ tablets as  samples. me  MANUFACTURING manual  as  also  the samples were  duly sent  by the  Appellant to  1 the  Indian Company. 290      On May  31, 1960, Mac Laboratories Private Limited, the First Respondent in this Appeal, applied for registration of the trade  mark ’TRISTINE’  in class  5 in  respect  of  its medicinal   preparation   for   symptomatic   treatment   of respiratory airlines.  On January  1,  1961,  the  Appellant

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filed a notice of opposition to the registration of the said mark ’TRISTINE’ on re ground that it was deceptively similar to its  trade mark ’DRISTAN’. The Appellant’s opposition was not accepted  by the  Assistant Registrar  of  Trade  Marks, Bombay, and  by his  order dated  March 27, 1962, he ordered the trade  mark ’TRISTINE’ to be registered in Part A of the Register of  Trade Marks.  The Appellant  thereupon filed an appeal in  the Bombay  High Court  which was  allowed  by  a learned Single  Judge of that High Court on February 5 1963. The First  Respondent thereupon  filed an  appeal  before  a division Bench of the said High Court and the Division Bench on April  l 1968,  allowed the said appeal but directed that the Respondent  application be  amended so  as to  read  the trade MARK ’TRISTIN’ as ’TRISTINA’.      In  the   meantime,  while   the   First   Respondent’s application for  registration of  the trade  mark ’TRISTINE’ was pending,  the Indian  Company applied  on September  23, 1960, to  the Central  Government under  section 11  of  the Industries (Development  and Regulation)  Act, 1951,  for  a licence to  manufacture the  tablets ’DRISTAN’.  In the said applications the Indian Company stated :           No Royalty  payment is  involved. This new product           will be  marketed under  the trade  mark ’DRISTAN’           which   belongs    to   American   Home   Products           Corporation, New  York who own 40 of the Company’s           capital and  whose products  are manufactured  and           distributed by us in India. The Indian  Company installed the said Stokes machine at its Ghatkopar factory  on October  5, 1960 and also informed the appellant that as the said machine was installed, the Indian Company  would   be  working   on  experimental  batches  of ’DRISTAN’ tablets  after completing  a few formalities which the Governments  It also  wrote to  the said  Home  Products International Limited  requesting it for a sample of 200 gms of Phenindamine  Tartarate U.S.P.,  one of  the  ingredients used in  the manufacture  of ’DRISTAN’  tablets. The  Indian Company also  applied for  an import  licence for  import of Phenylophrine Hydrocloride and Phenindamine Tartarate to the value of Rs. 6,000 and Rs. 12,000 c.i.f. Bombay respectively for the purpose of initial production of ’DRISTAN’ 291 tablets. The  licence under  the Industries (Development and Regulation) Act,  1951 was  granted to the Indian Company on January 19,  1961, for  the manufacture of ’DRISTAN’ tablets to the  extent of  five lakh  tablets per  month. Two of the conditions of the said licence were that no royalty would be payable and that the product will be marketed with the trade mark already  in use  or without  any trade mark . A further condition was  that no  special concession  in regard to the import of  basic raw  materials  and  ingredients  would  be sought in  relaxation of  the general  policy in  force from time to  time. On  January  23,  1961,  the  Indian  Company applied to the Director, Drugs control Administration, State of Maharashtra,  for  permission  to  manufacture  ’DRISTAN’ tablets. The  said application  was approved  by  the  Drugs Controller on  February 10,  1961. Meanwhile, on January 18, 1961, the  Appellant had filed a notice of opposition to the application for  registration of  the mark  ’TRISTINE’. As a counterblast to  the said  notice of  opposition, the  First Respondent on  April 10,  1961, filed  with the Registrar of Trade Marks, Calcutta, an application, being Application No. Cal-17, for  rectifying  the  Register  of  Trade  Marks  by removing therefrom  the Appellant’s trade mark ’DRISTAN’. On May 5,  1961, the first Respondent applied for amendment of the said  Recitification  Application  by  substituting  the

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paragraph containing  the  submissions  in  support  of  the grounds taken  therein by  a new paragraph. This application for amendment was allowed.      On October  18, 1961,  an agreement  was  entered  into between the Appellant and the Indian Company for granting to the Indian  Company the non-exclusive right to use the trade mark ’DRISTAN’  upon or  in relation to the goods in respect of which  the said  trade mark  was  registered  during  the unexpired residue  of the  term of  the registration  of the said trade  mark and  during  all  extensions  of  the  same subject to  the  determination  of  the  said  agreement  as provided therein.  By the said agreement, the Indian Company agreed to  become the registered user of the said trade mark ’DRISTaN’ and  further agreed  that the rights granted to it under the  said agreement  would not be deemed to entitle it to use  the said trade mark otherwise than as the registered user thereof.  Clauses 3,  4,  5,  6  and  7  of  the  said agreement provided as follows :           "3. The  Indian Company  shall follow the formulae           and specifications  prescribed and supplied by the           American Company.  The Indian Company will conform           to the  technical advice  tendered, will  use  the           quality 292           control methods  prescribed by or on behalf of the           American Company  in the  course of manufacture of           the goods  and will  not place upon the market any           goods which  do not  attain  to  the  standard  of           quality fixed by the American Company.           4. To  ensure maintenance of standards, the Indian           Company will  submit to the American Company or to           laboratories designated  by the  American  Company           for test  purposes  batch  samples  of  the  goods           manufactured  and   also  permit  duly  authorised           representatives of the American Company to examine           and inspect the Indian Company’s installations and           manufacturing processes  and control  methods used           in the  manufacture  of  the  said  goods  on  the           premises of the Indian Company at any time.           5. The  Indian Company convenants that it will not           u e  the said  Trade hark in any manner whatsoever           which    may    jeopardize    the    significance,           distinctiveness or validity of the said Trade Mark           and the  Indian Company will take all steps within           its power  to protect  and  defend  or  assist  in           protecting defending  the right  of  the  American           Company in and to the said Trade Mark.           6. All  use of  the said  Trade lark by the Indian           Company shall  clearly show  its ownership  by the           American Company  and its  ownership by the Indian           Company  only   by  permission   of  the  American           Company. The  Indian Company  therefore will apply           and use  the said Trade mark only in such form and           manner as  the American  Company may  from time to           time direct  and all  labels, containers, packing,           pamphlets, advertising and the like shall show the           said Trade  mark in  manner, design and use as the           American Company  so directs  and with  the  prior           approval in writing of the American Company.           7. There  is  no  royalty  or  other  remuneration           payable by  the Indian  Company  to  the  American           Company for the proposed permitted use of the said           trade mark. The said  agreement provided that in the event of any breach or default  by the  Indian Company  of any of the conditions

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contained in  the said  agreement, the  appellant would have the right  to prohibit  forthwith further  use by the Indian Company of the trade 293 mark ’DRISTAN’.  The said  agreement was  to remain in force until   determined by either party by ninety days’ notice in writing and  in the  event of  such termination  the  Indian Company was to discontinue all further use of the said trade mark and  to deliver  to  the  Appellant  the  manufacturing technology relating  to the said tablets ’DRISTAN’ including formulae, raw  materials, finishing  materials  and  packing materials supplied  by or  on behalf of the Appellant and to hold a  the disposition  of the  Appellant or its authorized representative  all  stocks  of  finished  goods  ready  for transfer to  any party  or parties  to whom the Appellant or its authorized  representative may  direct delivery  against payment of  any accrued or unpaid manufacturing charges with respect to the same.      On October  22, 1961,  the ’DRISTAN’ tablets were first marketed in  India by  Indian Company.  On March  6, 1962, a joint application  in Form  TM-28 was  made by the Appellant and the Indian Company for registering the Indian Company as a registered  user of the trade mark ’DRISTAN’ in respect of the goods  for  which  it  was  registered  subject  to  the following conditions  or restrictions  set out  in the  said application :-           The Trade  Mark is  to be  used by  the registered           user in  relation to the goods only so long as the           goods are  manufactured  in  accordance  with  the           formulae   and   specifications   prescribed   and           supplied by  the registered  proprietor,  only  so           long  as  the  registered  user  conforms  to  the           technical advice  tendered and  uses  the  quality           control methods  prescribed by or on behalf of the           registered proprietor in the course of manufacture           of the  goods and  only so  long as the registered           proprietor has a right to inspect, on the premises           of   the   registered   user,   the   goods,   the           installations, manufacturing processes and control           methods used  in the  manufacture of the goods and           is supplied on request with samples of the goods. In the  said application  it was  stated that  the  proposed permitted use  was without  limit of  period subject  to the right of the registered proprietor, namely the Appellant, to apply for  cancellation of  the  registered  user  forthwith after giving  ninety days  notice in  writing to  the Indian Company.  The   said  application   was  accompanied  by  an affidavit of Kenneth A. Bonham, the executive Vice President of the  Appellant, affirmed  on October  18, 1961,  that the trade mark ’DRISTAN’ was not till then used in India. In 294 view  of   the  said  rectification  proceedings,  the  said application for registering the Indian Company as registered user of  the trade mark ’DRISTAN’ was not processed but kept pending  until  the  final  decision  of  the  Rectification Application made by the First Respondent.      On December  7, 1964,  the Registrar  of  Trade  Marks, Calcutta,  dismissed   with  costs  the  First  Respondent’s Rectification Application.  The First  Respondent  thereupon filed an  appeal in  the Calcutta  high Court,  being Appeal No.61 of  1965, making  the Second  Respondent before us the Registrar of  Trade Marks,  Calcutta, the  Second Respondent thereto. A  learned single  Judge of  the said high Court by his judgment  delivered on May 10, 13 and 14, 1968, reported as Mac  Laboratories private  Ltd. v. American home Products

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Corporation and  Anr. A.I.R. 1969 Cal. 342, allowed the said appeal with  costs and  set aside the order of the Registrar of Trade  marks. Thereupon,  the Appellant  filed a  further appeal, being  Appeal No.  165 of  1968. A Division Bench of the said High Court by its judgment and order dated December 1, 1969,  reported as  American home  products Corpn. v. Mac Laboratories Private  Ltd. and Anr. (1970-71) 75 C.W.N. 118, S.C., L194  Fleet Street  Reports 215,  dismissed  the  said appeal with  no order  as  to  costs.  It  is  against  this judgment and  order that  the present  Appeal by certificate has been filed .      In order  to appreciate  what was held by the Registrar of Trade Marks and the learned Single Judge and the Division Bench of the Calcutta high Court and to test the correctness of the  rival submissions  advanced before  us,  it  is  now necessary to refer to the relevant statutory provisions.      The first  legislation in India relating to trade marks was  the  Trade  Marks  Act,  1940  (Amt  No.  V  of  1940), hereinafter referred  to as  the 1940 Act . The 1940 Act was repealed and  replaced with  effect from November 25, 1959, by the  Trade and Merchandise Marks Act, 1958 (Act No. 43 of 1958), hereinafter  referred to  as the 1958 Act . Section 2 of the  1958 Act  is the  definition section.  Clause (v) of section 2(1) defines the expression trade mark inter alia as meaning a  mark used  or proposed  to be used in relation to goods for  the purpose  of indicating or so as to indicate a connection in the course of trade between the goods and some person  having   the  right,  either  as  proprietor  or  as registered user, to use the mark whether with or without any indication of  the identity  of that person . The definition of the expression trade mark contained in clause (1) 295 of section  2 of  the 194 Act was the same as the portion of clause (v)  of section  2(1), of  the  1958  Act  reproduced above. Under  clause lb) of section 22) any reference to the use of a mark in relation to the goods is to be construed as a reference  to the use of the mark upon, or in any physical or in any other relation whatsoever, to such goods . Clauses (q), (r)  and (s)  of section  2(1  define  the  expressions registered proprietor , registered trade mark and registered user . They read as follows :           "(q) ’registered  proprietor’, in  relation  to  a           trade mark,  means the  person for  the time being           entered in the register as proprietor of the trade           mark;           ’registered trade  mark’ means  a trade mark which           is actually on the register;           (s) ’registered  user’ means  a person  who is for           the time being registered as such under section 49           . Clause (x)  of section  2(1) defines the expression tribunal as meaning  the Registrar  or, as  the case may be, the High Court, before which the proceeding concerned is pending .      The other  definition which is relevant for our purpose is that  of the expression permitted use contained in clause (m) of section 2(1). That definition is as follows :           (m) ’permitted  use’, in  relation to a registered           trade mark, means the use of a trade mark -           (i) by  a registered  user of  the trade  mark  in           relation to goods           (a) with  which he  is connected  in the course of           trade; and           (b) in  respect of  which the  trade mark  remains           registered for the time being; and           (c) for which he is registered as registered user;

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         and           (ii)  which   complies  with   any  conditions  or           restrictions to  which  the  registration  of  the           trade mark is subject . 296      Section 6  provides for  the maintenance  of  a  record called the  Register of  Trade Marks in which all registered trade marks  are to  be  entered.  Under  section  71),  the Register is to be divided into two parts called respectively Part A  and Part  . Under section 72), the register or Trade Marks existing  at the commencement of the 1958 Act is to be incorporated with  and  to  form  part  of  Part  A  of  the Register. The  Appellant’s trade  mark ’DISTAN’ leaving been registered under  the 194  Act, it  became part of Part A of the Register  of Trade  Marks  under  the  1958  Act.  Under section 136(2),  a registration  made under the 1940 Act is, if in force at the commencement of the 1958 Act, to continue in force and have effect as if trade under the corresponding provision of  the 1958  Act. Sub-section (1) of section 9 of the 1958  Act,  which  corresponds  to  sub-section  (1)  of section 6  of the  1940 Act  sets  out  the  requisites  for registration cf  a trade  mark. Under it a trade mark is not to be  registered in  Part  A  of  the  Register  unless  it contains or  consists of  at  least  one  of  the  essential particulars  set   out  in  that  sub-section.  One  of  the essential particulars set out in section 9(1) is one or more invented words .      Sub-section (1) and (4) of section 1 provide as follows :           1. Application for Registration. -           (1) Any  person claiming to be the proprietor of a           trade mark used or proposed to be used by him, who           is desirous  of registering  it,  shall  apply  in           writing to the Registrar’ in the prescribed manner           for the  registration of  his trade mark either in           Part A or in Part  of the Register.           x    x     x     x     x     x           (4) Subject  to the  provisions of  this Act,  the           Registrar may refuse the application or may accept           it  absolutely  or  subject  to  such  amendments,           modifications, conditions  or limitations,  if any           as he may think fit. The Appellant’  application for  registration of  the  trade mark ’DRISTAN’  was made under section 14(1) of the 1940 Act which provided a follows :           "14. application for registration.- 297           (1) Any  person c  np- to  be the  proprietor of a           trade mark  used or proposed to be used by him who           is A  desirous of  registering it  shall apply  in           writing to the Registrar in the prescribed manner,           and subject  to the  provisions of  this Act,  the           Registrar may refuse the application or may accept           lt  absolutely  or  subject  to  such  amendments,           modifications, conditions  or limitations, if any,           as he may think fit- It is  pertinent to note that both under section 141) of the 1940 Act  and section  18(1) of the 1958 Act, an application for registration  must  be  a  person  claiming  to  be  the proprietor of  a trade  mark used  or proposed to be used by him. Therefore,  unless it  is the  case of an applicant for registration that he is the proprietor of a trade mark which has been used by him or which is proposed to be used by him, he is not entitled to registration. Admittedly, in this case the trade  mark ’DRISTAN’  was not  at any  time used by the

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Appellant in  India at the date when it made its application for registration on August 18, 1958, nor did it claim in its application that the said trade mark had been 80 used by it. that was  stated in  the said  application as  that the said trade  mark   was  proposed  to  be  used  by  it.  Once  an application for  registration is  made  a  accepted  by  the registrar, the  Registrar has to cause the application to be advertised and  within three  months from  the date  of  the advertisement, any  person may  lodge with  the Registrar  a notice of  opposition in writing to the registration of such mark. A  copy of  such notice  of opposition is to be served upon the applicant. These provisions made in sections 20 and 21 of  the 195 Act correspond to section 15 of the 1940 Act. Under section 23(1), if the application has not been opposed and the time for giving the notice of opposition has expired or if  the application  has been  opposed and the opposition has been  decided in  favour of the applicant, the Registrar is "unless  the  Central  Government  otherwise  directs  to register the  said trade  mark in  Part A  or  Part  of  the Register, as  the case may be The trade mark when registered is to  be registered  as of  the date  of the  making of the application for  registration and  such date is to be deemed to be the date of registration. A similar provisions existed in section  16 of  the 1940  Act. to notice of opposition to the registration of the trade mark ’DRISTAN’ was ever lodged by anyone,  and accordingly  it was ordered to be registered by the  Registrar of  Trade marks. In view of the provisions of section 16 of the 1940 Act, the said trade mark ’DRISTAN’ was to  be deemed  for the  purposes of  the 1940  Act to be registered from the date of the application for its 298 registration namely, from August 18, 1958 and even after the coming into  force of  the 1958  Act  to  be  deemed  to  be registered from  the same  date for the purposes of one 1958 Act. under  section 25 of the 1958 Act, which corresponds to section 1  of the  190 Act, the registration of a trade mark is to  be for  a period  of seven  years, but can be renewed from time  to time  on application  made by  the  registered proprietor of  the trade  mark in  the prescribed manner and within the  prescribed period  and subject to the payment of the prescribed  fee. The  renewal of  the registration  of a trade mark  is to  be for  a period  of seven years from the date of  expiration of the original registration or the last renewal of registration, as the case may be.      The registration  of a trade mark confers very valuable rights upon  the registered  proprietor of  that trade mark. Under section 27(1) of the 1958 Act, no person can institute any proceeding  to prevent,  or to  recover damages for, the infringement of  an unregistered  trade mark.  however,  his right of  action against any person for passing off goods as the goods  of another  person or  the  remedies  in  respect thereof is not affected by reason of the fact that his trade mark is an unregistered one. Under section 28(1) of the 1958 Act,  subject   to  other   provisions  of   the  Act,   the registration of  a  trade  mark,  if  valid,  gives  to  the registered proprietor  of the trade mark the exclusive right to the  use of  the trade  mark in  relation to the goods in respect of  which the trade mark is registered and to obtain relief in  respect of  that a  company is about to be formed and registered  under the  Companies Act, 1956, and that the applicant intends  to assign the trade mark to- that company with a view to the use thereof in relation to those goods by the company.      (2) The  tribunal may,  in a-case  to which sub-section (1) applies,  require the applicant to give security for the

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costs of  any proceedings  relative  to  any  opposition  or appeal, and in default of such security being duly given may treat the application an abandoned.      (3) Where in a case to which sub-section (1) applies, a trade mark in respect of any goods is registered in the name of an  applicant who relies on intention to assign the trade mark to a company, then, unless within such period as may be prescribed, or  within such further period not exceeding six months as  the Registrar  may, on  application being made to him in  the prescribed  manner, allow,  the company has been registered as  the proprietor  of the trade marks in respect of those goods, the registration 299 shall ceased  to have  effect  in  respect  thereof  at  the expiration of that period, and the Registrar shall amend the register  accordingly.      An important  section for  the purpose  of the  present Appeal is  section  46  which  provides  for  removal  of  a registered trade mark from the Register. The infringement of the trade  mark in  the manner  provided by  the 1958 Act. A similar provision  was to  be found  in section 21(1) of the 1940  Act.   Section  29   of  the  1958  Act  defines  what constitutes infringement  of a  trade mark  while section 30 sets out the acts which do not constitute an infringement of the right  to the  use of  a registered  trade  mark.  Under section 36,  a registered proprietor of a trade mark has the power to  assign the  trade mark.  Under section 37, a trade mark is assignable and transmissible whether with or without the goodwill  of the  business concerned and that in respect either of  all the  woods in respect of which the trade mark is registered  or of some only of those goods. Under section 38,  an   unregistered  trade  mark  is  not  assignable  or transmissible except in the cases set out in sub-section (2) of that section.      Section 45 provides as follows :           "45 Proposed  use of  trade mar  by company  to be           formed.-           (1) No application for the registration of a trade           mark in respect of any goods shall be refused, nor           shall  permission   for     such  registration  be           withheld, on  the ground only that it appears that           the applicant  does not  use or propose to use the           trade mark, if the Registrar is satisfied material           provisions of section 46 are as follows :           46. Removal  from    register  and  imposition  of           limitations on ground of no-use.           (1) Subject  to the  provisions of  section 47,  a           registered  trade   mark  may  be  taken  off  the           register in respect of any of the goods in respect           of which  it is  registered on application made in           the prescribed  manner to  a High  Court or to the           Registrar by  any person  aggrieved on  the ground           either           (a) that the trade mark was registered without any           bonafide intention  on the  part of  the applicant           for 300           registration that it should be used in relation to           those goods  by him  or, in  a case  to which  the           provisions of  section 45  apply, by  the  company           concerned, and  that there  ha, in  fact, been  no           bona fide  use of  the trade  mark in  relation to           those goods by any proprietor thereof for the time           being up  to a  date one  month before the date of           the application; or

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         (b) that up to a date one month before the date of           the application, a continuous period of five years           or longer  had elapsed during which the trade mark           was registered  and during which there was no bona           fide use thereof in relation to those goods by any           proprietor thereof for the time being:           Provided that, except where the applicant has been           permitted under  sub-section (3)  of section 12 to           register an  identical or  nearly resembling trade           mark in  respect of the goods in question or where           the tribunal  is of opinion that he might properly           be permitted so to register such a trade mark, the           tribunal may  refuse an  application under  clause           (a) or  clause (b) in relation to any goods, if it           is shown  that there has been, before the relevant           date or  during the  relevant period,  at the case           may be,  bona fide  use of  the trade  mark by any           proprietor thereof  for the time being in relation           to goods  of the  same description, being goods in           respect of which the trade mark is registered.           x        x        x         x         x           (3) An  application shall  not be entitled to rely           for the  purpose of  clause (b) of sub-section (1)           or for the purposes of sub-section (2) on any non-           use of  a trade  mark which  is shown to have been           due to  special circumstances in the trade and not           to any  intention to  abandon or  not to  use  the           trade mark  in relation  to the goods to which the           application relates."      The   First    Respondent’s   said    application   for rectification was  made both  under section 46 and 56 of the 1958 Act.  Under section  56(2), any person aggrieved by any entry made in the Register of Trade Marks without sufficient cause or  by any entry wrongly remaining on the Register may apply in the prescribed 301 manner to a High Court or to the Registrar, and the tribunal may make  such order  for making,  expunging or  varying the entry as it A may think fit. Under section 56(4), this power can also  be exercised by the High Court or the Registrar of its own  motion after giving notice to the parties concerned and after  giving them  an opportunity  of being heard. This power includes  the power to cancel or vary the registration of a trade mark. Against such an order made by the Registrar rectifying, cancelling  or removing  a trade  mark from  the Register of Trade Marks, an appeal lies under section 109 to a Single  Judge of  the High Court and against an order made by the Single Judge of the High Court, a further appeal lies to a Bench of the High Court.      What is now required to be set out is section 48 of the 1958 Act,  the interpretation  of which  is crucial  for the purpose of  deciding this  Appeal, for that section provides for registration of a registered user and the effect of such registration.      Section 48 provides as follows :           48. Registered users.-           (1) Subject  to the  provisions of  section 49,  a           person other  than the  registered proprietor of a           trade mark  may be  registered as  the  registered           user thereof in respect of any or all of the goods           in respect  of which  the trade mark is registered           otherwise than  as a defensive trade mark; but the           Central Government  may, by  rules  made  in  this           behalf,   provide    that   no   application   for           registration as  such shall  be entertained unless

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         the agreement  between the  parties complies  with           the  conditions   laid  down   in  the  rules  for           preventing trafficking in trade marks.           (2) The  permitted use  of a  trade mark  shall be           deemed to  be use  by the  proprietor thereof, and           shall be  deemed not  to be  use by a person other           than the  proprietor, for  the purposes of section           46 or  for any other purpose for which such use is           material under this Act or any other law. Section 49  prescribes the  procedure for  registration of a registered user and is in the following terms :           49. Application  for  registration  as  registered           user.- 302           (1) Where  it is  proposed that a person should be           registered as  a registered  user of a trade mark,           the  registered   proprietor  and   the   proposed           registered user  shall jointly apply in writing to           the Registrar  in the prescribed manner, and every           such application shall be accompanied by -           (i)  the   agreement  in   writing   or   a   duly           authenticated copy  thereof, entered  into between           the  registered   proprietor  and   the   proposed           registered user  with respect to the permitted use           of the trade mark; and           (ii)  an   affidavit  made   by   the   registered           proprietor or  by some  person authorised  to  the           satisfaction  of  the  Registrar  to  act  on  his           behalf,-           (a)  giving   particulars  of   the  relationship,           existing or  proposed, between  the proprietor and           the   proposed    registered    user,    including           particulars showing  the degree  of control by the           proprietor over  the  permitted  use  which  their           relationship will  confer and whether it is a term           of their relationship that the proposed registered           user shall  be the  sole registered  user or  that           there shall be any other restriction as to persons           for  whose   registration  as   registered   users           application may be made;           (b)  stating   the  goods   in  respect  of  which           registration is proposed;           (c) stating  the conditions  or  restrictions,  if           any, proposed  with respect to the characteristics           of the  GOODS to  the mode  or place  of permitted           use, or to any another matter;           (d) stating whether the permitted use is to be for           a period or without limit of period, and, if for a           period, the duration thereof; and           (iii) such  further documents or other evidence as           may be  required by  the Registrar  or as  may  be           prescribed.           (2) When  the requirements of sub-section (1) have           been  complied   with  to  his  satisfaction,  the           Registrar shall  forward the  application together           with his  report and all the relevant documents to           the Central Government. 303           (3) On receipt of an application under sub-section           (2), The  Central Government, having regard to all           the circumstances of the case and to the interests           of the  general public, and the development of any           industry, trade  or commerce  in India, may direct           the Registrar           (a) to refuse the application; or

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         (b) to  accept application  either  absolutely  or           subject  to   any  conditions,   restrictions   or           limitations which the Central Government may think           proper to impose;           Provided  that   no  direction  for  refusing  the           application or  for its  acceptance  conditionally           shall be  made unless the applicant has been given           an opportunity of being heard.           (4) The Registrar shall dispose of the application           in accordance  with the  directions issued  by the           Central Government sub-section (3).           (5)  The  Central  Government  and  the  Registrar           shall, if  so requested  by  the  applicant,  take           steps for  securing that information given for the           purpose  of  an  application  under  this  section           (other than  matters entered  in the  register) is           not disclosed to rivals in trade.           (6)  The  Registrar  shall  issue  notice  in  the           prescribed manner  of the registration of a person           as a registered user, to ocher registered users of           the trade mark, if any.      As we have seen, before a person can be registered as a registered user  of a  registered trade mark, the registered user’s agreement  between the  parties is to comply with the conditions laid down in the Rules for preventing trafficking in  trade  marks.  section  133  confers  upon  the  Central Government,  by   notification  published  in  THE  Official Gazette  and   subject  to   the   condition   of   previous publication" the  power to  make  rules  to  carry  out  the purposes of  the 1958  At. Under  section 134,  all rules so made are  to be  laid for  not less  than thirty days before each house  of Parliament  as soon  as may be after they are made  and   are  to  be  subject  to  such  modification  as Parliament may make in the session in which they are so laid or the session immediately 304 following In  exercise of  this power the Central Government has made  the  Trade  and  Merchandise  Marks  Rules,  1959. Chapter V  of these  Rules consisting  of  Rules  82  to  93 relates to  registered users.  Under Rule 82, an application for registering a person as a register user is to be made in Form TM-28  jointly by  the proposed registered user and the registered proprietor  of  the  trade  mark  and  is  to  be accompanied inter alia by the agreement in writing or a duly authenticated  copy   thereof  entered   into  between   the registered proprietor  and the proposed registered user with respect to  the permitted  use of the trade mark. Rule 85 is in the following terms :           85. Consideration by the Central Government.-           The  Central   Government,  on   receipt   of   an           application for  registration as  registered  user           forwarded to it by the Registrar under sub-section           (2) of  section 49,  shall, if  satisfied that the           application and  the accompanying documents comply           with the  provisions of  the Act  and  the  rules,           consider whether  the  APPLIED  cation  should  be           allowed having  regard to the matters specified in           sub-section (3)  of that  section, and in doing so           may take  into account all or any of the following           matters :-           (1) whether  the permitted  use if  allowed  would           contravene the  policy of  the  Act  which  is  to           prevent trafficking in trade marks;           (2)  whether   the   registered   proprietor   has           registered the  trade mark  without any  bona fide

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         intention to  use it  in relation  to his goods in           the course  of trade  or solely  or mainly for the           purpose of  permitting  others  to  use  it  under           agreements for registered user; and           (3) whether the registered proprietor has acquired           title to  the trade mark by assignment without any           bona fide  intention to  use it in relation to his           goods in  the course  of trade or solely or mainly           for the  purpose of  permitting others  to use  it           under agreements for registered user.      Explanation I.  - For considering the bona fides of the registration of the trade mark under clause (2) regard shall be h had inter alia to - 305           (a) whether the goods for which the trade marks is           registered are  similar to  or are  different from           the goods  in which  the registered proprietor has           been trading or dealing before the registration or           the mark;           (b) whether  the registered  proprietor  has  ever           used the mark in question in relation to his goods           in the  course of  trade before  the date  or  the           agreement for  registered user,  and  if  so,  the           amount and duration of such user;           (c) whether  the terms  as to  royalty  and  other           remuneration payable  by the  proposed  registered           user  and   reasonable  taking  into  account  the           expenses which the registered proprietor is likely           to incur i exercising over the permitted use.      Explanation II.  - For  Considering the  bona fides  of the I  acquisition of title under clause (3) regard shall be had, besides  the matters  SEL out  in Explanation  I to the following further  matter, namely,  whether  the  registered proprietor has obtained assignment of other registered trade mark and  if o, whether he ha dealt with such other marks by way of assignment or registered user.      Three grounds  were  taken  in  the  First  Respondents Application  for   Rectification.  lt   will  facilitate  an understanding of  the controversy  between the parties if we were to reproduce these grounds. They are :           (i)  ’That   the  said  trade  mark  ’DRISTAN’  is           deceptively and  confusingly similarity  the  mark           ’BISTAN’ Registered  under No  122391 in  class  5           (advertised in T.M. Journal No. 47) in the name of           Messrs  Prof.  Gajjar’s  Standard  Chemical  Works           Ltd., of Bombay. The said trade mark  ’BISTAN’ has           been  used   and  is   being  used   by  its  said           proprietors  in   respect   of   their   medicinal           preparation since several years pat.           (ii) That  the Registered  Proprietor on  the said           trade  mark   ’DRISTAN’  alleged   in   the   said           opposition No.  Bom. 76  that the  said trade mark           ’DRUSTAN’ is deceptively similarity the said trade           mark ’TRISTINE’ which the 306           Applicants have  lawfully been using since October           1960  in respect of their medicinal preparation.           (iii) That  there has  been no bonafide use of the           said trade  mark ’DRISTAN’ in India in relation to           the goods  for  which  it  is  registered  by  any           proprietor thereof  for the  time being  upto date           one month before the date of this application. The second  ground mentioned  above was  taken in order make out that the First Respondent was a person aggrieved for the purposes of  section 46  and  56(2)  of  the  195  Act.  The

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Appellant had  contested this  position but this particular controversy does  not survive  for it  is no more in dispute that the First Respondent was person aggrieved.      The submission  set out  in the  said  Application  for Rectification in  support of  the above  three grounds  were substituted  by   fresh  submissions   by  an  amendment  as mentioned earlier. These submissions define the scope of the controversy  between   the  parties.   The  submissions   so substituted were           (i) That  the said  trade mark  ’DRISTAN’ was  not           distinctive mark and nor was not regenerable trade           mark under  Sec.6 of  the Trade  marks  Act,  1940           (corresponding to  Section 9  of  Act  No.  40  of           1958), except upon evidence of its distinctiveness           and  no   such  evidence   was  submitted  to  the           Registrar before registration.           (ii) That  the said  trade mark  was registered in           contravention of Section 8 of the Trade Marks Act,           1940 (corresponding  to Section  11 of the present           Act, of 1958).           (iii) That the said trade mark offends against the           provisions of Section 11 of the Act.           (iv) That  the said  trade mark  ’DRISTAN’ is  not           distinctive  of   the  goods   of  the  registered           proprietors.           (v)  That   the  said  trade  mark  ’DRISTAN’  was           registered without  any bonafide  intention on the           part of  the Applicants  for registration  that it           should be used in 307           relation  to   their  medicinal   preparation  for           symptomatic treatment  of respiratory  ailments by           them and  that there  has, in  fact, been  no bona           fide use in India of the said trade mark ’DRISTAN’           in  relation   to  the  said  goods  by  the  said           proprietors upto  a date one month before the date           of this application.      All  the   above  submissions   were  rejected  by  the Registrar. In  coming to  the conclusion  that the Appellant had the  bona fide intention to use the trade mark ’DRISTAN’ the Registrar  relied upon  the decision of Lloyd-Jacob, J., in the  case of  ’BOSTITCH’ Trade  Mark, (1963)  R.P.C. 183. Accordingly, the  Registrar dismissed the said Rectification Application. During  the course of the proceedings, a carton of ’DRISTAN’  tablets was filed along with an affidavit made on behalf  of the First Respondent. The legend upon the said carton read as follows :           MADE IN INDIA BY ; GEOFFREY MANNERS & CO. LIMITED,           Magnet  House,   Doughall  Road,  Bombay  for  the           Proprietors  Whitehall  Laboratories,  New  York,           N.Y., U.S.A." The Registrar  held that  Whitehall Laboratories  was not  a separate legal  entity and, therefore, the mark could not be registered in its name but only in the name of the Appellant of which  it formed  a par  and  accordingly  the  Registrar ordered the entry in the Register relating to the Trade Mark ’DRISTAN’  to   be  varied   by  amending   the   registered proprietor’s  name   to  read  as  ’American  Home  Products Corporation (  a corporation organised under the laws of the State of  Delaware, United  States of  America)  trading  as Whitehall Laboratories  . In  the appeal  filed by the First Respondent against  the order  of the  Registrar the learned single Judge  held that  at the  date of  the making  of the application for  registration the  Appellant did  not have a bona fide  intention to  use the  trade mark  ’DRISTAN’,  by

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itself. In  coming to  this conclusion  the  learned  Single Judge relied  upon the  decision of  the word  of  Trade  in England in  the case  of ’PUSSY  GALORE’ Trade  Mark, (1967) R.P.C. 265,  1954 (hereinafter  referred to as the Shavaksha Committee Report ), and the Report of Mr. Justice Rajagopala Ayyangar on  Trade Marks  Law  Revision,  1955  (hereinafter referred to  as the  Ayyangar Report  ). The  learned Single Judge further  held that  the Appellant  had not at any time used the said trade mark in relation to the goods in respect of which  it was registered. According to the learned Single Judge, the  legal fiction  created by  section 48(2)  of the 1958 Act came 308 into play only after a trade mark was registered and that an intention to  use a  trade mark  through someone  who  would subsequently get himself registered as a registered user did not amount  to an intention on the part of the applicant for registration to  use the  trade mark  himself.  The  learned Single Judge  held  that  to  accept  the  Appellant’s  said contention would  amount to permitting traffic hang in trade marks. In view of the conclusion he had reached, the learned Single Judge  did not decide the question whether trade mark ’DRISTAN’ was  deceptively and  confusingly similar  to  the trade mark  ’BISTAN’. The  learned Single  Judge accordingly allowed the  said appeal.  In further  appeal  the  Division Bench rejected  the contention that the trade mark ’DRISTAN’ was deceptively  and confusingly  similar to  the trade mark ’BISTAN’. It, however, confirmed the judgment of the learned Single Judge  in respect  of the  construction which  he had placed upon  section 18  and 48  of the  195 Act in order to come to  the conclusion  that the Appellant had no bona fide intention to  use itself  the trade  mark ’DRISTAN’ and that the Appellant had not at any time made use of the said trade mark.  It  accordingly  dismissed  the  Appellant’s  further appeal. The main judgment of the division each was delivered by S.K.  Mukherjee, J., with whom A.K. Mukherjee, J., agreed and at  the conclusion  of his  judgment S.K. Mukherjee, J., pointed out  the hardship  which the  construction placed by the Division  Bench upon  section 18  and 48 of the 1958 Act would lead to. These observations are (at page 143) :           "It is  neither good  sense nor  good policy to be           plus royaliste  que  le  roi,  to  be  more  of  a           royalist than  the king himself. A legal situation           which permits  use of a registered trade mark by a           registered user  but disqualifies  the  proprietor           from registering  his mark if he intends to use it           only through a registered user even when a user is           available  who   is  ready   and  willing   to  be           registered on  terms which are unexceptionable, is           a situation  fraught with three-quarters irony and           the rest unconscious humour.           It is  not for the Courts of Law to provide relief           where relief should be provided by the legislature           by ignoring  a conscious departure the statute has           made, strain  its construction  and assume  powers           which ore properly belong to the legislature."                                         (Emphasis supplied.) 309 proper construction of the relevant sections of the 1958 Act shows that there is neither any cause for sardonic merriment nor any need to shed tears.      The submissions  made at  the hearing of this Appeal by Mr. F.S.  Nariman, learned counsel for the Appellant, may be thus summarized :      1. The  leal fiction  created  by  sub-section  (2)  of

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section 48  is, as expressly stated in that sub-section, for the purposes  of section  46 or  for any  other purpose  for which such  use is  material under  the 195 Act or any other law. To confine this fiction to a case of an actual use of a trade mark by a registered user is to confine it only to use for the  purposes of  clause (b)  of section  46(1) which is contrary to  the purpose  for which  the  said  fiction  Was created and,  therefore, when  section 1(1)  of the  15  Act (corresponding to  section 14(1  of the  1940 Act)  uses the words proposed  to be  used", these  words must  be read  as proposed to be used by a proposed registered user.      2. To  register a  trade mark  which is  proposed to be used by  a  registered  user  does  not  per  se  amount  to trafficking in trade marks and whether it doe so or not must depend upon the facts and circumstances of each case.      3. The  reliance placed  by the High Court, both by the learned single  Judge and  Division Bench  upon  the  ’PUSSY GALORE’ Trade  Mark Case  was  unjustified  and  unwarranted inasmuch as  the provisions  of the English Act, namely, the Trade Marks Act, 1938, are radically different from those of the 1958  Act as  also the  194 Act an, therefore, that case has no relevance so far as the construction of section 18(1) read with section 48(2) of the 1958 Act is concerned.      4. The  reliance placed  by the High Court (both by the learned  single  Judge  and  the  Division  Bench  upon  the Shavaksha Committee  Report  and  the  Ayyangar  Report  was equally  misplaced   as  Parliament   did  not   accept  the recommendations with  respect to  registered users  made  in either of these reports.      5. The  facts and  circumstances of  the case show that the  appellant  had  at  the  date  of  the  making  of  the application for  registration a  bona fide  intention to use the trade mark ’DRISTAN’ through a registered user. 310      6. In  any event,  the Appellant  itself had  made bona fide use  of the  said trade  mark up  to a  date one  month before the  date of  the First  Respondent’s Application for Rectification.      The submissions  made by  Dr.  Gauri  Shankar,  learned Counsel for the First Respondent, were as follows :      1. The  words proposed  to be used" in section 18(1) of the 1958 Act and section 14(1) of the 1940 Act mean proposed to be  used by  the applicant for registration, his servants and agents  and not  by any person who is proposed to be got registered as  a registered  user and,  therefore, the legal fiction enacted  in section  48(2) cannot  be imported  into section 18(1).      2. A  registered user  can only come into being after a trade mark  is registered.  Therefore, as  at the date of an application for  registration of  a trade mark, there cannot be any  person in  existence who  is a  registered user, the words "proposed to be used" cannot possibly mean proposed to be used by a proposed registered user      3. To  permit a  trade mark  to be  registered when the applicant himself does not propose to use it but proposes to use it  through  someone  else  who  would  subsequently  be registered  as   a  registered   user  would  be  to  permit trafficking in  trade marks  which is contrary to the policy underlying the Trade Marks laws.      4. The  only case  in which  the 1958  Act permits  the registration  of   a  trade  mark  when  the  applicant  for registration does  not intend  to use it himself but intends to use  in through another is the one set out in section 45, namely, where  the Registrar  is satisfied that a company is about to  be formed  and registered under the Companies Act,

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1956, and  the applicant intends to assign the trade mark to that company with a view to the use thereof by the Company.      5. The 1958 Act is, as the 1940 Act was, based upon the English Trade  Marks Act  , 1938,  and the  decision in  the ’PUSSY GALORE’  Trade Mark Case concludes this point against the Appellant.      6. The  Shavaksha Committee  Report  and  the  Ayyangar Report show  the legislative  intent not to allow a proposed use by  a proposed  registered user  to be  equated  with  a proposed use by the u applicant for registration. 311      7. The  Appellant had not at any relevant time made use of  the trade mark ’DRISTAN’      8. The  Appellant had fradulently obtained registration of the  trade mark  ’DRISTAN’ by  stating in the application for registration that it proposed to use the said trade mark itself and  by not  disclosing the  fact that it proposed to use it through a proposed registered user.      9.  The   trade  mark  ’DRISTAN’  was  deceptively  and confusingly  similar   to  the   trade  mark  ’BISTAN’  and, therefore, it cannot be allowed to remain on the Register of Trade Marks.      10. To  allow the trade mark ’DRISTAN’ to remain on the Register of  Trade Marks  would be contrary to the policy of the Government of India.      We  will   no  test  the  correctness  of  these  rival submissions.      The first  Respondent’s Application  for  Rectification was stated  to be  made under  section 46 and 56 of the 1958 Act and  Rule 94  of the  Trade and Merchandise Marks Rules, 1959. Rule  94 is irrelevant because it merely prescribes in which form  an  application  for  rectification  of  or  for varying or  expunging any  entry in  the Register  of  Trade Marks  is   to  be  made  and  by  what  documents  such  an application is  to be accompanied. Under section 56 an entry wrongly remaining  on the  Register of Trade Marks is liable to be  expunged therefrom.  An entry  relating to a mark the use of  which would be likely to deceive or cause confusion, would be  an entry  wrongly remaining  on the  Register and, therefore, liable to be expunged therefrom.      The principal  challenge of the First Respondent to the trade mark  ’DRISTAN’ remaining  on the  Register was  under clause (a)  of section  46(1). The  main question before us, therefore, is  whether the entry in the Register relating to the said  trade mark  falls within  the mischief of the said clause (a); for if it does, it is liable to be taken off the Register. The relevant provisions of section 46 have already been set  out above. Before a person can made an application under section  46(1) to  take off  a  trade  mark  from  the Register he  has to  be a  "person aggrieved".  It is now no more disputed  that  the  First  Respondent  was  a  "person aggrieved" within  the meaning  of  section  46(1).  Section 46(1) provides  for two  cases in  which a  registered trade mark may  be taken off the Register in respect of any of the goods in respect of which it is 312 registered. The  first case  is set  out  in  clause  (a  of section 4(1)  and the  second in  clause  (b  of  that  sub- section. There  are two  conditions to  be satisfied  before clause (a) can become applicable. These conditions are      1. that  the trade mark was registered without any bona fide intention  on the  applicant for  registration that  it should be used in relation to those good ‘by him, and      2. that  there has,  in fact,  been no bona fide use of that trade  mark in relation to those good by any proprietor

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thereof or  the time  being to  a date  one month before the date of the application under section 46(1)      The only exception to the first condition set out above is of  a case  to which  the provisions of section 45 apply, that is,  if the  trade mark of which registration is sought is proposed  to be  used by  a company  which is about to be formed and  registered under the Companies Act, 1956, and to which the  applicant intends t() assign the trade mark. Both the conditions  set out in clause (a) are cumulative and not disjunctive. Clause  (a), therefore,  will not   apply where even though  there had  been no  bona fide  intention on the part of the applicant for registration to use the trade mark but, in  fact, there  has been  a bona fide use of the trade mark in  relation to  those goods  by any proprietor thereof for the time being up to a date one month before the date of the application  under section  46(1). Similarly, clause (a) will not  apply where,  though there  had been  a bona  fide intention on  the part  of the applicant for registration-to use the trade mark, in fact, there has been no bona fide use of the  trade  mark  in  relation  to  those  goods  by  any proprietor thereof for the time being up to a date one month before the date of the application under section 46(1).      Clause  (b)  of  section  46(1)  applies  where  for  a continuous period  of five  years or longer from the date of the registration  of the  trade mark, there has been no bona fide use  thereof in  relation to  those goods in respect of which it  is registered  by any  proprietor thereof  for the time being. An exception to clause (b) is created by section 46(3). Under  section 46(3),  the non-use  of a  trade mark, which is  shown to have been due to special circumstances in the trade  and not to any intention to abandon or not to use the trade  mark in  relation  to  the  goods  to  which  the application under  section 46(1) relates, will not amount to non-use for the purpose of clause (b). 313      The distinction  between clause  (a) and  clause (b) is that if  the period  specified in clause (b) has elapsed and during that  A period there has been no bona fide use of the trade mark,  the fact  that the  registered proprietor had a bona fide intention to use the trade mark at the date of the application for  registration  becomes  immaterial  and  the trade mark  is liable  o be removed from the Register unless his case  falls under  section 46(3), while under clause (a) where there  had been a bona fide intention to use the trade mark in  respect of  which registration  was sought,  merely because the  trade mark  had not  been  used  for  a  period shorter than  five years  from the  date of its registration will not  entitle any  person to  have that trade mark taken off the Register-      Under both these clauses the burden of proving that the facts which bring into play clause (a) or clause (b), as the case may  be, exists  is on the person who seeks to have the trade mark  removed from the Register. Thus, where there has been a non-user of the trade mark for a continuous period of five years and the application for taking off the trade mark from the  Register has been filed one month after the expire of such  period. the  person seeking  to have the trade mark removed from  the Register has only to prove such continuous non-user and  has not  to prove  the lack  of  a  bona  fide intention on  the part  of the  registered proprietor to use the  trade   mark  at   the  date  of  the  application  for registration. Where,  however, the  non-user is for a period of less  than five  years, the  person seeking to remove the trade mark  from the Register has not only to prove non-user for the  requisite period  but has  also to  prove that  the

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applicant for  registration of  the trade  mark had  no bona fide intention  to use  the trade  mark when the application for registration was made.      The reason  why the  two conditions specified in clause (a) are  made cumulative  is obvious.  As the  definition of trade mark" contained in clause (v) of section 2(1) shows, a trade mark is a mark used or proposed to be used in relation to goods  for the purpose of indicating or so as to indicate a connection  in the  course of  trade between the goods and some person  having the  right  to  use  the  mark.  It  is, therefore, not  necessary for  the purpose  of registering a trade mark  that those  goods should  be in existence at the date of  the application  for  registration.  A  person  who intends to  manufacture goods  or has  made preparations for the  manufacture  of  goods  but  the  manufacture  has  not commenced and,  therefore, goods  have not  been marketed is none the  less entitled  to get  the trade  mark  which  the proposes to use 314 in relation  to those  goods registered.  In the present day world of commerce and industry, a manufacturing industry can neither be  commenced nor  established overnight.  There are innumerable preparatory  steps  required  to  be  taken  and formalities to  be complied  with before the manufacture of goods can  start and  the manufactured  goods marketed.  The processes must  of necessity take time. If the position were that the  mere non-user  of a  trade  mark  for  the  period mentioned in  clause (a) of section 46(1) would make a trade mark liable  to be taken off the Register it would result in great hardship and cause a large number of trade marks to be removed from  the Register, because the moment one month has elapsed after  the registration  of a  trade mark  has  been ordered, a trade rival can make an application on the ground set out in clause (a) of section 461 claiming that there has been no  bona fide  use of  the trade  mark up to a date one month before  the date of his application. It is in order to prevent such  harassment and  absured result  that  the  two conditions  specified   in  clause   (a)  have   been   made cumulative.      The object  underlying  section  46(1)  is  to  prevent trafficking in  trade marks.  This is,  in fact,  the object underlying all  trade mark  laws. A  trade mark  is meant to distinguish the  goods made by one person from those made by another. A  trade mark, therefore, cannot exist in vacuo. It can only  exist in  connection with the goods in relation to which it  is used  or intended  to be used. Its object is to indicate a  connection in  the course  of trade  between the goods and  some person  having the  right to  use  the  mark either with  or without  any indication  of the  identity of that person.  Clause (v)  of section  2(1) which defines the expression ’trade  mark’ makes  this abundantly clear. Trade marks became  important after  the Industrial  Revolution  a distinguish goods  made by  one person  from those  made  by another; and  soon the  need was  felt  to  protect  traders against those  who were unauthorizedly using their marks and accordingly registration  of trade  marks was  introduced in England by the Trade Marks Registration Act, 1875, which was soon replaced  by more  detailed and  advanced  legislation. When a  person gets  his trade  mark registered, he acquires valuable rights by reason of such registration. Registration of his  trade mark  gives him the exclusive right to the use of the trade mark in connection with the goods in respect of which it  is registered and if there is any invasion of this right by  any other person using a mark which is the same or deceptively similar  to his  trade mark,  he can protect his

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trade mark  by an  action for  infringement in  which he can obtain injunction, damages or an account of profits made 315 by the  other person. In such an action, the registration of a trade  mark is prima facie evidence of its validity. After the expiry  of seven years from the date of the registration a trade  mark is  to be  valid in all respects except in the three cases  set out  in section  3. The  proprietor  of  an unregistered trade mark whose mark is unauthorisedly used by another cannot,  however, sue  for the  infringement of such trade mark.  His only  remedy lies in bringing a passing-off action,  an   inconvenient  remedy   as   compared   to   an infringement action.  In a  passing-off action the plaintiff will have  to prove  that his mark has by user acquired such reputation as to become distinctive of the plaintiff’s goods so that  if it  is used in relation to any goods of the kind dealt with  by the  plaintiff, it  will be understood by the trade  and   public  as  meaning  that  the  goods  are  the plaintiff’s goods.  In an infringement action, the plaintiff is not  required  to  prove  the  reputation  of  his  mark. Further, under  section 37  a registered  mark is assignable and transmissible  either with  or without  goodwill of  the business concerned  while under  section 38  an unregistered trade mark  is not assignable or transmissible except in the three cases set out in section 3(2).      As the  registration  of  a  trade  mark  confers  such valuable rights  upon the  registered proprietor  thereof, a person cannot  be permitted to register a trade mark when he has not  used it in relation o the goods in respect of which it is  sought to  be registered or does not intend to use it in relation  to such  goods. The  reason for  not permitting such trade  marks to be registered was thus stated by Romer, J., in  In re  the Registered  Trade-Marks of John Batt  Co. and In  re Carter’s  Application for a Trade-Mark:, (1898) 2 Ch. D. 432, 436, S.C. 15 R.P.C. 262, 266.           " ...one  cannot help  seeing the  evils that  may           result from  allowing trade-marks to be registered           broadcast, if  I may  use  the  expression,  there           being no  real intention of using them, or only an           intention possibly  of using  them in respect of a           few articles.  The inconvenience it occasions, the           cost it  occasions, is very large, and beyond that           I cannot  help seeing  that it  would lead  in  of           cases to absolute oppression, and to persons using           the position  they  have  obtained  as  registered           owners of  trade marks  (which are not really bona           fide trade  marks) for  the purpose of trafficking           in then  and using the as a weapon to obtain money           from subsequent  persons who  may want to use bona           fide trade  marks in  respect of  some classes  in           respect of which they find those bogus trade-marks           registered.                                          (Emphasis supplied) 316 The judgment  of Romer,  J., in  Batts case was confirmed by the Court  of Appeal, (1898)2 ch.D.432 at pages 439-442, and by the  house of Lords sub nominee John Batt & co.v. dunnett and Anr. (1986) A.C.420; S.C. 16 R.P.C. 411.      To get a trade nark registered Without any intention to use it  in relation to any Gods but merely to make money out of it  by selling  to others  the right  to use  it would be trafficking in  that trade mar. In Re American Greetings Cor Application, [1983]  2 ALLEY.  ALL E.K. 609, 619, Dillon, L. J., said in the Court of Appeal :           "Trafficking in  a  trade mark has from the outset

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         been one  of the  cardinal sins of trade mark law.           but  there   is  no     statutory   definition  of           trafficking, and  one may  suspect that,  as  with           usury in the middle       Ages, though it is known           to be  a deadly  sin, it  has become less and less           clear, as  economic circumstances  have developed,           what the sin actually comprehends.           Trafficking must   involve   trading in or dealing           with the  trade  mark for money’s worth, but it is           not all dealing with a trade mark or money that is           objectionable,, since it has always  been accepted           that it  is permissible o sell trade mark together           with the goodwill of the business in the course of           which the trade Mark has teen used.                                        (Emphasise supplied.) In the  same case,  Lord Brightman  in the  house of  Lords, [1984] 1  All E.K..  426,433, summed  up the position in law thus:           " My  Lords, although  as  a  matter  of  ordinary           English, trafficking in trade marks might mean the           buying  and  selling  of  trade  marks,  it  seems           obvious that  it is  to have  a  more  specialised           meaning in a trade mark context. I have no quarrel           with the  definitions suggested  by the  assistant           registrar and  by Sir  Denys Buckley,  but perhaps           one further  attempt on  y part  may not be out of           place. The  courts have to grope for some means of           delineating  the   forbidden  territory,   and   h           different modes of expression may help to indicate           boundaries which  are not and cannot be marked out           with absolute  precision. To  my mind, trafficking           in a trade 317           mark context  conveys   the notion  dealing  in  a           trade mark  primarily as,  commodity  in  its  won           right and  not  primarily  for  the    purpose  of           indentifying or promoting merchandise in which the           proprietor of  the nark is interested. if tiler is           no real trade connection between the proprietor of           the mark  and the  licensee or his goods, there is           room for  the conclusion  that the  grant  of  the           licence is  a trafficking  in the  ark.  It  is  a           question of fact and degree in ever case whether a           sufficient trade connection exists. We have  no hesitation in accepting the meaning given to the expression trafficking  in a  trade   Dillon, LJ.,  and Lord Brightman.      The  intention  to  use  a  trade  mark  sought  to  be registered must  be, therefore,  genuine and   real  and  as pointed out  by J  Tomlin, J.,  in In re ducker’s Trade mark (1928)   Ch. L  405, 409,  the fact  that the  mark  was  as thought to be something which some day might be useful would not amount to any definite and precise intention at the time of registration  to use  that mark. The intention to use the mark  must   exist  at  the  date  of  the  application  for registration and  such intention  must be  genuine and  bona fide. In  fact, section  46(1)(a) expressly  speaks of "bona fide  intention   on  the   part  of   the  application  for registration  which  would  mean  "at  the  date  when  such applicant makes his application for registration      We will  now address  ourselves to the question whether the facts  which bring into play clause (a) of section 46(1) exist in  the present  case. What  is first  required to  be ascertained for this purpose is whether the Appellant had an intention that  the trade  mark ’DRISTAN’  should be used in

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India in  relation to  the  concerned  goods.  Assuming  the Appellant had  such an  intention, the  next question  which will fall  to be determined is whether this intention was an intention on  the part  of the  Appellant to   use  the said trade mark itself or to use it through a registered user and if he  intention was  to use  it through  a registered user, whether clause  (a) of section 46(1) would be attracted. The third question will be whether such intention on the part of the Appellant was a  bona fide one.      Intention is  a state  of mind.  No person can make out the state  of mind  of another  person. None the less courts are often 318 called upon for various purposes to determine the state of a person’s mind.  The Courts  can only  do so by deducting the existence of  a particular state of mind from the facts of a case section 14 of the Indian Evidence Act, 187, provides as follows:           "14. Facts  Showing existence of state of mind, or           of body or bodily feeling.-           Facts showing  the existence of any state of mind,           such  as   intention,   knowledge,   good   faith,           negligence,  rashness,   ill-will   or   good-will           towards any  particular  person,  or  showing  the           existence of  any state of body or bodily feeling,           are relevant, when the existence of any such state           of mind  or body  or bodily feeling is in issue or           relevant.           Explanation 1.  A fact  relevant  as  showing  the           existence of  a relevant  state of  mind must show           that the  state of mind exists, not generally, but           in reference to the particular matter in question.           x       x         x             x The second  Explanation to  that section is not material for out purpose .      It was submitted by  Dr. Gauri Shankar, learned Counsel for the  First Respondent,  that in  order to ascertain what the Appellant’s  intention was,.  the Court can only look at events previous  to the  relevant date,  namely, the date of the application for registration made by the Appellant, that is, August  18, 1958,  and  not  to  any  events  subsequent thereto. Whether subsequent events are relevant or not would depend upon the facts and circumstances of each case and the question at  issue therein.  In Srinivas Mall Bariroliya and Anr. v.  Emperor, A.I..  1947 P.C.  135, Appellant  No. 1, a Salt Agent  for the  District  Magistrate,  was  inter  alia charged with  having abetted  Appellant No.2,  who had  been appointed by him, in selling salt to licensed retail dealers to whom  allocations of specific quantities of salt had been made by  the Central Government, on three specified dates at a price  exceeding the maximum price which had been fixed by the District  Magistrate. Appellant  No.1 was  convicted and sentenced to imprisonment under Rule 81(4) of the Defence of India Rules,  1939, relating  to the  control of  prices. In addition to the evidence of the three dealers to whom 319 the salt  was sold,  nine other  dealers who had bought salt from appellant  No.1 and had to deal with Appellant No.2 and had obtained  salt from  him at  a price exceeding the fixed maximum price,  were also  called in evidence as prosecution witnesses. The transactions with the other nine dealers took place not  only during and shortly before the dates on which the offences  were  committed  but  also  after  the  period covered by the dates of the offences. The Judicial Committee of the Privy Council held (at page 139 :

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         "... The  evidence was  relevant to  the charge of           abettin, because  it showed  an intention  to aid           the commission  of the  offence and an intentional           omission to  put a  stop to  an illegal  practice,           which, it  need hardly  be added,  was an ’illegal           omission’. The  evidence was  thus  admissible  to           prove intention under s. 14 Evidence Act.’                                         (Emphasis supplied.)      Dr. Gauri  Shankar then  submitted   that in  any event facts subsequent  to the  date  of  the  First  Respondent’s Application for  Rectification, namely, April 1, 1961, could not be  looked at  by the  Court. We  are equally  unable to agree. As  we nave  pointed out  earlier, where a trade mark has been  registered on  the round  that the  applicant  for registration proposes  to use such trade mark, a trade rival in order  to cause vexation and harassment to the registered proprietor can  file his  application immediately  after the expiry of  one month  from the date of the order registering the trade  mark. As pointed out by us, where a trade mark is proposed co  be used, the manufacture and marketing of goods in relation  to which such trade mark is proposed to be used SL of  necessity case  time;  and  not  to  look  at  events subsequent to  the date of the Application for Rectification would result in great injustice      It was next submitted by Dr. Gauri Shankar that for the purpose of  ascertaining the intention of the Appellant, the Court cannot  look at  the technical collaboration agreement and the  registered user agreement inasmuch as neither these agreements nor  copies thereof were produced before the High Court bu copies the were produced for tile first time during the course  of the  hearing or this Appeal his argument also cannot be accepted. Both these agreement  have been referred to in  the ii  affidavits filed before the Registrar and the High Court and also 320 dealt with  by the  Registrar, the  learned Single Judge and the Division  Bench in  their respective  judgments. In this connection, it  will not be out of place to set out here the circumstances in which copies o these agreements came not be produced before this Court. During the course of the hearing of the peal, w called upon learned Counsel for the Appellant to file before us copies of the application for registration of  the   trade  mark  ‘DRISTAN’  and  the  application  for registering the Indian Company as the registered user of the said trade  mark. The  original file  relating to  the trade mark ‘DRISTAN’  was before  the Registrar  when he heard the First Respondent’s  Application for  Rectification and  also before the  High Court  when the  matter was  heard  by  the learned Single Judge and the Division Bench Copies, however, of the  said two applications were not on the record, and we wanted to  ascertain for  ourselves what was stated in those applications. At  that time  learned Counsel  for the  first Respondent got up and requested Us that the Appellant should also be  asked to  produce copies of the said two agreements and accordingly  we directed the Appellant to file copies of those two agreements also, which it did.      It is  because the  intention of  the Appellant  at the date of  filling  the  application  registration  is  to  be ascertained from  the facts  existing in  this case  that we have related  them at some length in the earlier part of our judgment. We  will now  summarize these facts with reference to three  periods :  (1) events  which took  place up to the date of  the application for registration, namely, August 18 1958, (2)  events which  happened between  that date  an the date of  he Application for Rectification, namely, April 10,

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1961 and  (3) events  which happened subsequent to April 10, 1961.      So far  a the  period up  to August 18, 1958 concerned, prior to  156, the  Appellant  had  acquired  a  substantial shareholding to  the extent  of 40  per cent  in the  Indian Company. In  1956 the  Appellant introduced ’DRISTAN’ TABLES in the  American market  and got  the  trade  mark  ’DRISTAN REGISTERED i  the United  States of  America and  in several other  countries.   technical  collaboration   between   the Appellant and the Indian. Company commenced from November 1, 1957, and  an agreement in that behalf was signed on May 16, 1958. In  pursuance of  the said collaboration agreement the Indian Company manufactured and marketed several products of the Appellant. The Appellant got  registered its trade marks in respect  of such  products and  the  Indian  Company  was registered as the registered user in respect 321 of such  trade marks.  As early  as December  1957,  it  was decided that  the Indian  Company should  introduce  in  the Indian market  nine new  products of the Appellant including ’DRISTAN’ tablets.  On August  18, 1958, the Appellant filed an application  for registration of the trade mark ’DRISTAN’ and the said trade mark was duly registered on June 8, 1959.      Dr.  Gauri   shankar,  however,   submitted  that   the collaboration agreement  was  irrelevant  because  ’DRISTAN’ tablets were  not  mentioned  in  Schedule  A  to  the  sail agreement,  and,   therefore,  the  intention  to  introduce ’DRISTAN’  tablets  in  the  Indian  market  and  the  facts relating thereto  did not  have anything to do with the said collaboration agreement.  In this  behalf, Dr. Gauri Shankar relied upon  the definition  of ’Licensed Products’ given in the  said  agreement.  This  submission  is  wholly  without foundation. That definition related to Whitehall Products in respect   of   whose   marketing,   manufacture,   sale   or distribution in India, the Indian Company was to be licensed under and  pursuant to  the terms  of the said collaboration agreement and  it further  stated that  "these shall include those identified  in Schedule Annexed hereto and made a part hereto". lt  is true  that Schedule  A to the said agreement does not  mention ’DRlSTAN’ tablets but the products set out in schedule A are not exhaustive of the Licensed Products to which the  said collaboration  agreement related and this is made  clear  by  the  rule  of  the  word  ‘‘include’’  with reference to the products identified in Schedule A. There is no dispute  that ’DRISTAN’  tablets are  Whitehall Products. The division  of the  Appellant, which at all relevant times carried  on   and  still   carries  on   the   activity   of manufacturing  and  marketing  pharmaceutical  products,  is called the Whitehall laboratories and it was for this reason that the  Registrar ordered  the entry relating to the trade mark ’DRISTAN’  to be  amended so  as to  show the Appellant trading  as   ’Whitehall  Laboratories.  The  definition  of "Licensed Products"  in  the  said  collaboration  agreement comprehended not  only the  Whitehall Products  set  out  in Schedule A  to the  collaboration agreement  but also  other products in  respect of  which the  Indian Company  would be licensed for  import, manufacture,  sale or  distribution in India  under   the  terms   of  the   said  agreement.   The correspondence between  the parties leaves no doubt that the manufacture and  of  the  ’DRISTAN  tablets  by  the  Indian Company in  India was  to be  under the  said  collaboration agreement.      So far  as the second period is concerned, namely, that . between  August 18,  1958,  and  the  date  of  the  first Respondent’s

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322 Application for  Rectification, that  is,  April  10,  1961, during that  period  the  Indian  Company  applied  for  and obtained a  licence for  the purchase  of a  Stockes  Triple Layer Machine  for manufacturing  ’DRlSTAN’ tablets and when the said  machine was received installed it at its Ghatkopar factory. It  also obtained from the Appellant three units of ’DRISTAN’ tablets  as samples  and the  manufacturing manual for the  said tablets.  Further, it  applied to  the Central Government under  section 11  of the Industries (Development and Regulation)  Act, 1551,  for a  licence  to  manufacture ’DRISTAN’ tablets  which was  granted to it. It also applied for and  obtained a  licence to  import certain  ingredients used in  the manufacture  of ’DRISTAN’  tablets and imported such ingredients.  It further  applied for and obtained from the  Director,   Drugs  Control   Administration,  State  of Maharashtra, permission  to manufacture  ’DRISTAN’  tablets. The Appellant also filed a notice of opposition to the First Respondent’s Application  for  registration  of  their  mark ’TRISTINE’.      During the  third period, namely, the period subsequent to the  First Respondent’s  Application  for  Rectification, that is,  subsequent to April 10, 1961, on October 18, 1961, the said  registered user agreement was entered into between the Appellant  and the  Indian Company. On October 22, 1961, the ’DRISTAN’  tablets were  first marketed  in India by the Indian Company.  On March  6, 1962,  the Appellant  and  the Indian Company  jointly made  an application to register the Indian Company  as a  registered  user  of  the  trade  mark ’DRISTAN’.      The facts  set out  above clearly show that each of the is an  integral link  in a  chain and  that they  cannot  be divided into  three separate  periods as  contended  by  Dr. Gauri Shankar.  This continuous  chain of events establishes beyond doubt  that the  Appellant had  an intention that the trade mark  ’DRISTAN’ should  be used  in  relation  to  the tablets in  question by  the manufacture  and sale  of these tablets in India.      This brings us to the question whether the intention of the Appellant to market and manufacture ’DRISTAN’ tablets in India was  to do  so itself or to do so through a registered user.  Mr.   Nariman,  learned  Counsel  for  the  Appellant submitted that  as the  intention of  the Appellant  was  to market ’DRISTAN’  tablets in  India, it could translate that intention into  action either by getting it manufactured and marketed by  a registered  user in India or as exporting the tablets to India and if the import 323 policy did  not permit  this to be done, it could export the tablets to  India when  the import  policy was relaxed. This argument is  contrary to the facts on the record and must be rejected. A  person’s intention  is shown  by the facts of a case and  not by  statements made  at the  Bar. The facts of this case  clearly establish  that the Appellant’s intention in applying for registration of the trade mark ’DRISTAN’ was to use  it in  relation to  goods  to  be  manufactured  and marketed by the Indian Company and that for this purpose the Indian Company would get itself registered as the registered user of the said trade mark. Further, in the affidavit sworn on April  13, 1962,  by S.  Waldron, Vice-President  of  the Appellant, it is categorically stated as follows :           "It was  intended that  the  product  bearing  the           ’DRISTAN’  trade   mark  be  introduced  in  India           through Geoffrey  Manners &  Co.  Ltd.  should  be           registered as  registered user  in  India  of  the

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         trade  mark   ’DRISTAN’.  For   this  reason   all           applications to  Government authorities  and  Drug           Control authorities  were made by Geoffrey Manners           & Co.  Ltd. In  implementation of the intention to           appoint Geoffrey  Manners & Co. Ltd. as registered           users of  the trade  mark ’DRISTAN’,  preparations           were undertaken  to appoint Geoffrey Manners & Co.           Ltd. as registered users and these culminated into           execution of registered user agreement between the           Registered Proprietors  and Geoffrey Manners & Co.           Ltd.  which  has  been  dated  the  18th  October,           1961"’. In view  of this  sworn statement  made  on  behalf  of  the Appellant it  is not  open to  Counsel to  submit  that  the proposed use  by the  Appellant  could  also  have  been  by exporting ’DRISTAN’ tablets to India.      The Appellant’s  application for  registration  of  the trade mark  ’DRISTAN’ was  made under  section 14(1)  of the 1940 Act  and was  registered under that Act. Under the said section 14(1),  only a  person claiming to be the proprietor of a  trade mark  "use or  proposed to be used by him" could apply for registration of that trade mark. The provisions of section 18(1)  of the 1958 Act are identical. This brings us to the  crucial question  whether the  words "proposed to be used by  him" would  include "proposed  to be used through a registered proprietor".  In other  words,  the  question  is whether a proposed user by a registered user of a trade mark can be equated with a proposed user by the proprietor of the trade mark. 324      On behalf  of the  Appellant it  was submitted  by  Mr. Nariman that  the two  phrases "proposed  to be used by him" ant "proposed  to be  used by  a registered  user"  must  be equated by  reason of the statutory legal fiction created by section 48(2)  of the  1958 Act which corresponds to section 39(2) of  the 1940 Act. According to Mr. Nariman, unless the legal fiction  enacted in  section 48(2) applied also to the provisions of  section 18(1),  it would  have a very limited operation and  can apply only so far as the second condition of clause  (a) of  section 46(1) and clause (b) of that sub- section are concerned, which, according to him, would render nugatory the  words "or for any other purpose for which such use is  material under  this Act or any other law" occurring in section 48(2).      Dr. Gauri  Shankar on  behalf of  the First Respondent, however submitted  that both under the 1940 Act and the 1958 Act a  registered  user  is  not  the  same  person  as  the proprietor of  a registered trade mark for a registered user can only  be some  person other  than the  proprietor of the trade mark  and that  no registered user can come into being unless and  until a  trade  mark  has  been  registered  and thereafter an application for registration as the registered user thereof  has been  made and  granted. He also submitted that the  legal fiction enacted in section 48(2) of the 1958 Act and section 39(2) of the 1940 Act cannot for this reason apply to  the provisions  of section  18(1) or  to the first condition of  clause (a)  of section  46(1) of  the 1958 Act and, therefore,  the Appellant  was not entitled to seek the protection of the said legal fiction. According to Dr. Gauri Shankar, if  the proprietor  of a trade mark intended to use it through  another, he could only do it by having resort to section 45  of the 1958 Act, which corresponds to section 36 of the 1940 Act, by getting it registered for the purpose of assigning it  to a company to be formed and registered under the Companies  Act, 1956.  In Dr. Gauri Shankar’s submission

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the only  three ways  in which,  therefore, the  trade  mark ’DRISTAN’ could  have  been  used  in  India  were  for  the Appellant to have resort to section 45 by floating a company to  which,  when  incorporated,  the  trade  mark  would  be assigned or  by manufacturing  the tablets ’DRISTAN’ it self in India  and thereafter  by  assigning  it  to  the  Indian Company or by Jointly applying along with the Indian Company to have the Indian company registered as the registered user of the said trade mark.      The Appellant’s  application for  registration  of  the trade mark  ’DRISTAN’ was  made under  the 1940  Act and its registration  was   also  ordered   under  that   Act.   The application for registering 325 the Indian company as the registered user was, however, made under the  1958 Act. If the 1940 Act did not contain a legal fiction similar to that enacted in section 48(2) of the 1958 Act, the  Appellant’s case  would fall to the ground because then at  the date of its application for registration of the said trade mark, its intention would be not to use it itself but to  use it through  another. The 1940 Act, however, also made provisions with respect to registered users and created a similar legal fiction in section 39(2) of the Act. Section 39 of the 1940 Act provided as follows :           "39. Registered users.-           (1) A  person other that the proprietor of a trade           mark  may  be  registered  as  a  registered  user           thereof in  respect of  all or any of the goods in           respect of  which it is registered (otherwise than           as a  defensive trade  mark) and  either  with  or           without conditions or restrictions.           (2) The  permitted use  of a  trade mark  shall be           deemed to  be use  by the  proprietor thereof, and           shall be  deemed not  to be  use by a person other           than the  proprietor, for  any purpose  for  which           such use  is material  under this Act or any other           law. "The only difference between section 39(2) of           the 1940  Act and section 48(2) of the 1958 Act is           that while  under section  39(2) the legal fiction           created by  it applies  "for any purpose for which           such use  is material  under this Act or any other           law",  under   section  48(2)  the  legal  fiction           applies "for the purposes of section 46 or for any           other purpose for which such use is material under           this Act  or any  other law".  The addition of the           words "for  the purposes of section 46" in section           48(2) not  only does  not make  any difference but           clarifies the  scope of the said legal fiction. As           we have  seen, clause  (a) of section 46(1) refers           both to  "bona fide  intention on  the part of the           applicant for  registration that  it (that is, the           trade mark)  should be  used in  relation to those           goods by  him" as  also to  "bona fide  use of the           trade mark  in relation  to  those  goods  do  any           proprietor thereof  for the time being." It cannot           possibly be  that  when  section  48(2)  expressly           provides that  the permitted  user of a trade mark           by a registered user is to be deemed to be user by           the proprietor  of the trade mark for the purposes           of section  46, the  fiction is  intended only  to           apply to the use of the trade mark 326 referred to in the second condition of clause (a) of section 46(1) and  not to  the use of that trade mark referred to in the first  condition of  the said  clause (a). Under section

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18(1), an  application for  registration of a trade mark can only be  made by a person who claims to be the proprietor of that  trade   mark.  Therefore,  the  words  "applicant  for registration" in clause (a) Of section 46(1) would mean ’the person claiming  to be  the proprietor of the trade mark who is the  applicant for  registration of that trade mark". The first condition  of clause  (a) would, therefore, read "that the trade  mark  was  registered  with  out  any  bona  fide intention on  the part  of the  person claiming  to  be  the proprietor of  that trade  mark who has made the application for registration that it should be used in relation to those goods by  him". So  read, there  can  be  no  difficulty  in reading the  words "by him." also as "by a registered user". Similarly, we  see  no  difficulty  in  applying  the  legal fiction in  section 48(2) to section 18(1). Section lb(l) in the light of the said legal fiction would read Is any person claiming to  be the  proprietor of  a  trade  mark  used  or proposed to  be used  by him  or by  a registered  user". By reason of  the provisions  of section 39(2) of the 194C Act, section 14(1)  of that  Act should  also be read in the same way.      In celebrated  passage Lord  Asquith of  Bishopstone in East End  Dwellings Co.  Ld.  v.  Finsbury  Borough  Council (1952) A.C. 109, said (at page 132) :           " If you are bidden to treat an imaginary state of           affairs  as   real,  you   must   surely,   unless           prohibited from,  doing so,  also imagine  as real           the  consequences  and  incidents  which,  if  the           putative state  of affairs  had in  fact  existed,           must invitably have flowed from or accompanied it.      In the  State of Bombay v. Pandurang Vinayak Chaphalkar and Others  [1953] S.C.R.773,  this Court held (at page 132) while approving the above passage of Lord-Asquith :           "When a  statute enacts  that something  shall  be           deemed to  have been done, which in fact and truth           was not  done, the  court is entitled and bound to           ascertain  for  what  purposes  and  between  what           persons the statutory fiction is to be resorted to           and full  effect must  be given  to the  statutory           fiction and  it should  be carried  to  its  logic           conclusion." 327      The purposes  for  which  the  said  fiction  has  been enacted are   set  out in  section 48(2). These purposes are the purposes  of section  46 or  for any  other purpose  for which such  use is  material under the 1958 Act or any other law. To  confine the  purpose only  to a  part of section 46 would be  to substantially  cut down  the operation  of  the legal fiction. The purpose for which the legal fiction is to be resorted to is to deem the permitted use of a trade mark, which means  the use  of the trade mark by a registered user thereof, to be the use by the proprietor of that trade mark. Having regard  to the  purposes for  which  the  fiction  in section 48(2) was created and the persons between whom it is to be  resorted to, namely, the proprietor of the trade mark and the  registered user thereof, and giving to such fiction its full  effect and  carrying it to its logical conclusion, no other  interpretation can  be placed  upon  the  relevant portions of section 18(1) and of clause (a) of section 46(1) than the one which we have given.      In reaching  the conclusion which they did, the learned Single Judge and the Division Bench of the High court relied heavily upon  the PUSSY GALORE’ Trade Mark Case. In order to understand what  was held in that case it is necessary first to refer  to some  of the  provisions of  the English  Trade

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Marks Act,  1938 (1  & 2  Geo. 6, c. 22), as the 1958 Act is based largely  upon the provisions of the English Act though with certain  important differences.  Section 17(1)  of  the English Act  sets out  who can  apply for  registration of a trade mark  and is in pari materia with section 18(1) of the 1958 Act. Under section 11(4), the refusal by a Registrar to register the trade mark is subject to appeal to the Board of Trade or to the court at the option of the applicant. If the appeal is  to the  court, there can be further appeal to the Court of  Appeal and  from there  to  the  House  of  Lords, Section 2h  provides for  removal of  a trade  mark from the Register and  is in pari materia with section 46 of the 1958 act. Section  32 deals  with rectifying  the entries  in the Register and is analogous to section 56 of the 1958 Act.      Under section  87 of  the Patents,  Designs  and  Trade Marks Act,  1883 (46  & 47  Vict.  c.  57),  any  registered proprietor could  grant licences  to use the mark subject to any equity.  The 1883  Act in  so far as it related to trade marks was repealed by the Trade marks Act, 1905 (5 Edw. 7 c. 15). The 1905 Act did not, however, contain any power in the registered proprietor  to grant licences. The English Act of 1938, however,  introduced a system of official approval for licences to use a trade mark 328 Particularly by  providing for  registering a  Person  other than the proprietor of the trade mark as the registered user of the  trade mark.  It  will  be  useful  to  set  out  the provisions cf the English Act of 1938 relating to registered users in  order to  Focus our  attention on  the differences between the  English Act  and the  1958 Act  with respect to registered users.      Sub-sections (1),  (2) and  (4) to  (2) of  section  28 provide as follows :           "28. "Registered users.-           (1) Subject  to the  provisions of this section, a           person other  than the  proprietor of a trade nark           mark  may  be  registered  as  a  registered  user           thereof in  respect of  all or any of the goods in           respect of  which it is registered (otherwise than           as a  defensive trade  mark) and  either  with  or           without conditions or restrictions.           The use  of a  trade mark  by  a  registered  user           thereof in  relation to  goods with  which  he  is           connected in the course of trade and in respect of           which for  the time  being the  trade mark remains           registered and  he is  registered as  a registered           user,  being  use  such  as  to  comply  with  any           conditions   or    restrictions   to   which   his           registration is  subject, is  in this Act referred           to as the ’permitted use’ thereof.           (2) The  permitted use  of a  trade mark  shall be           deemed to  be use  by the  proprietor thereof, and           shall be  deemed not  to be  use by a person other           than the  proprietor, for  the purpose  of section           twenty six  of this Act and for any other purposes           for which  such use  is material under this Act or           at common law.           (4) Where  it is  proposed that a person should be           registered as  a registered  user of a trade mark,           the proprietor  and the  proposed registered  user           must apply  in writing  to the  Registrar  in  the           prescribed manner  and must  furnish  him  with  a           statutory declaration  made by  the proprietor, or           by some person authorised to act on his behalf and           approved by the Registrar-

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         (a)  giving   particulars  of   the  relationship,           existing or  proposed, between  the proprietor and           the proposed 329           registered user, including particulars showing the           degree of  control  by  the  proprietor  over  the           permitted use which their relationship will confer           and whether  it is  a term  of their  relationship           that the  proposed registered  user shall  be  the           sole registered  user or  that there  shall be any           other  restriction   as  to   persons  for   whose           registration as  registered users  application may           be made;           (b)  stating   the  goods   in  respect  of  which           registration is proposed;           (c)  stating   any  conditions   or   restrictions           proposed with  respect to  the characteristics  of           the goods,  to the mode or place of permitted use,           or to any other matter, and           (d) stating whether the permitted use is to be for           a period  or without limit of period, and if for a           period,  the   duration  thereof;  and  with  such           further documents,  information or evidence as may           be required under the rules or by the Registrar.           (5) When  the requirements  of the  last foregoing           subsection  have   been  compled   with,  if   the           Registrar,  after   considering  the   information           furnished  to   him  under  that  sub-section,  is           satisfied that in all the circumstances the use of           the trade  mark in  relation to the proposed goods           or any  of them  by the  proposed registered  user           subject to  any conditions  or restrictions  which           the Registrar  thinks proper would not be contrary           to the public interest, the Registrar may register           the proposed  registered user as a registered user           in respect  of the  goods as  to which  he  is  so           satisfied subject as aforesaid.           (6) The  Registrar  shall  refuse  an  application           under the  foregoing provisions  of his section if           it appears  to him  that the  grant thereof  would           tend to facilitate trafficking in a trade mark. Sub-section (1) and (2) of section 29 provide as follows :           "29. Proposed  use of trade mark by corporation to           be constituted. etc. 330           (1) No application for the registration of a trade           mark in respect of any goods shall be refused, nor           shall  permission   for   such   registration   be           withheld, on  the ground only that it appears that           the applicant  does not  use or propose to use the           trade mark,           (a) if  the tribunal  is  satisfied  that  a  body           corporate is about to be constituted, and that the           applicant intends  to assign the trade mark to the           corporation with  a view  to the  use  thereof  in           relation to those goods by the corporation; or           (b)  if  the  application  is  accompanied  by  an           application for  the registration of a person as a           registered  user   of  the  trade  mark,  and  the           tribunal is  satisfied that the proprietor intends           it to  be used by that person in relation to those           goods and  the tribunal  is  also  satisfied  that           person will  be registered  as a  registered  user           thereof immediately  after the registration of the           trade mark.

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         (2) The  provisions of  section twenty-six of this           Act shall have effect, in relation to a trade mark           registered  under   the  power  conferred  by  the           foregoing sub-section, as if for the reference, in           paragraph  (a)  t.  of  sub-section  (1)  of  that           section, to  intention on the part of an applicant           for registration  that a trade mark should be used           by him  there  were  substituted  a  reference  to           intention on  his part  that it  should be used by           the corporation or registered user concerned."      In the  ’PUSSY GALORE’  Trade mark Case a company filed forty-six applications for registering different trade marks in  respect  of  goods  falling  under  seventeen  different classes. official  objection was  raised that,  owing to the very large and diverse range of goods covered by the several applications, the  Registrar  was  not  satisfied  that  the applicant company  had itself the necessary intention to use the marks applied For. All the marks sought to be registered related to  novels written  by the late Ian Fleming. Thirty- nine of  the said  applications related to marks ’James Bond Secret Agent’  and ’007  Secret Agent’, James Bond being the hero of  those novels  and ’007’  being  his  official  code number. The  remaining seven applications were in respect of the mark  ’PUSSY  GALORE’.  Pussy  Galore  was  a  character featuring in Ian Fleming’s novel ’Godfinger’, being a female with Jew’ 331 unorthodox morals  and a  name which  would appear  to be an obscene  pun in very questionable taste. The Registrar heard one of the said applications which related to the trade mark ’PUSSY GALORE’.  The other  relevant  facts  appear  in  the decision of  the  Registrar.  The  relevant  passage  is  as follows (at page 266) :           " The  mark in suit and the others to which I have           referred all contain references either directly or           indirectly to  the well-known  fictional character           James  Bond  and  Mr.  Bevan  explained  that  the           applicant company  were closely connected with the           devisor  of  that  character,  the  late  Mr.  Ian           Fleming and  that his  widow has  some interest in           the company.  Mr. Bevan further explained that at           the time  the various  applications were filed the           applicants  did   not  propose  to  use  the  mark           themselves but were filed of the intention to seek           others who  would put  the mark  to use  either as           registered users  or as licensees. The application           was not  however  accompanied  by  application  to           register users  as specified  in section 29(1)(b).           Mr.  Bevan   stated  that   it  was  a  convenient           commercial practice  to operate through registered           users but  the latter might not be agreeable so to           act Until  the mark  was registered.  He submitted           that the  requirements of  the Act as to intention           to use are satisfied in these conditions." The Registrar  took the  view that  the English  Act of 1938 required that, to qualify as an applicant, the proprietor of the mark  must either  possess the intention to use the mark himself at the time of application or have applied under the conditions of clause (a) or clause (b) of section 25(1). The Registrar accordingly refused the application. The applicant appealed to  the Board  of Trade and the appeal was heard by G.W. Tookey,  Esq., Q.C.,  who dismissed  the  appeal’.  The relevant passages  from the  judgment of  the Board of Irade are as follows (at pages 269 and 27C) :           "  Having   carefully  considered   the   relevant

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         sections  of   the  Act,   I  conclude   that  the           Registrar’s decision is right. In My view, section           17 has the limited meaning attributed to it by the           Registrar. There  is no  difficulty about the case           of servants  and agents,  because although various           executive acts may be performed by them on behalf           of their  principal who  is the  applicant for the           Dark, the use of the mark 332           vis-a-vis the  public is  by the  applicant and no           one  else.   As  regards  registered  users,  when           section 17  was framed  by  the  legislature,  the           effect of the introduction into trade mark law for           the first  time of registered user provisions must           have been  borne in mind. It would be obvious from           the provisions  of section  28, and  also from the           definition of  ’trade mark’  in section  68,  that           actual use of a trade mark might be exclusively by           a registered user and not by the proprietor at all           I agree  with the  Registrar that  section  28  is           dealing   with    matters   which    arise   after           registration, and  has no  such bearing  upon  the           interpretation  of   section  17  and  29  as  the           applicants have  contended. As above indicated, my           view is  that section  29 state  the only  case in           which an  intended use,  ex hypothesi not a use by           the  applicant,  can  be  regarded  as  justifying           dispensation from  the requirements of section 17.           What  happens   after  registration   calls   for           different consideration both as regards the use of           marks in  accordance with the provision of the Act           and as  regards the  consequences of use otherwise           than in  accordance with  the  provision  of  that           Act."      In our  opinion, the High Court was unduly impressed by this case and unnecessarily attached great importance to it. The High  Court justified  its reliance  upon that  case  by referring to the following passage from the judgment of this Court in  The Registrar  of Trade  Marks  v.  Ashok  chandra Rakhit Ltd. [1955] 2 S.C.R. 252. (at pages 259-60) :           "As the  law of  Trade Marks  adopted in  our  Act           merely reproduces the English Law with only slight           modifications,  a   reference  to   the   judicial           decisions on  the  corresponding  section  of  the           English Act is apposite and must be helpful." What the  High Court  overlooked was  that in  Ashok Chandra Rakhit’s Case  the section  of the  1940 Act  which fell for interpretation was  in Pari  materia with  the corresponding section of the English Act of 1938 which has been judicially interpreted by  the court in England. As pointed out by this Court in  Forasal v.  Oil d  Natural Gas Commission [1984] 1 S.C.R. 526,  549, 567;  s.c. (1984)  Supp. S.C.C.  263, 280, 295, in the absence of any binding 333 authority of  an Indian  Court on a particular point of law, English decisions  in  which  judgments  were  delivered  by judges held  in high  repute can  be referred to as they are decisions  of   courts  of   a  country  from  which  Indian Jurisprudence and  a large  part of  our law is derived, for they are  authorities of  high persuasive value to which the court may legitimately turn. for assistance; but whether the rule laid  down in  any of these cases can be applied by our courts must,  however, be  judged in  the context of our own laws and  legal procedure  and the  practical  realities  of litigation in our country.

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    The relevant provisions relating to registered users in the  English   Act  and  in  the  1958  Act  are  materially different. The  English Act  creates two legal fictions. The first is  contained in  section 28(2)  which relates  to the permitted use  of a  trade mark.  That fiction  18  for  the purpose of  section 26  (which corresponds  to section 46 of the 1958  Act) and  for any other purpose for which such use 18 material  under the  English Act  or at  common law.  The second  is   contained  in  section  29(2)  and  relates  to intention on  the part of an applicant for registration that a trade  mark should  be used  by him. The second fiction is for the  purposes of  paragraph (a)  of section  26(1) which corresponds to  clause (a) of section 46(1) of the 1958 Act. The 1958  Act, however,  contains only one fiction. It 18 in section 48(2),  which is  in pari materia with section 28(2) of the  English Act.  In our  opinion, the omission from the 1958 Act of a provision similar to that contained in section 29(2) of the English Act toes not make any difference if one were to see the said section 29(2) in its proper setting and context. The  English Act  does not  prescribe, just  as the 1958 Act  does not,  any period  of time  from the  date  of registration of a trade mark within which an application for registering a person as a registered user of that trade mark should be  made. Section  29(1) of the English Act, however, provides that  an application  for registration  of a  trade mark  can   be  accompanied   by  an   application  for  the registration of  a person as a registered user of that trade mark, and  if the  tribunal is satisfied that the proprietor of the  trade mark  intends lt  to be used by that person in relation to  those goods  and is also satisfied that  person will be  registered as  a registered  user thereof after the registration of  the trade  mark,  lt  will  not  refuse  to register the  trade  mark.  The  effect  of  section  29(1), therefore, is  that an  application for registering a person as a  registered user  can be  made simultaneously  with the application for  registering the  trade mark and if both are found to  be satisfactory,  the application for registration would be granted and 334 immediately thereafter  the registration  of the  registered user would  be allowed. In such a case, the intention on the part of  the applicant  for registration that the trade mark should be  used by  the registered  user thereof  is  to  be deemed to  be an  intention to  use that  trade mark  by the application for  registration. This  is a  special provision applicable to a special case. The fiction created by section 29(2) is  also made  applicable to the case of a corporation about to  be constituted  to which  the applicant intends to assign the  trade mark. There is no such fiction relating to intention expressly  provided in  the 1958  Act, or is there any provision  for simultaneously  making an application for registration  of   a  trade  mark  and  an  application  for registering a  person as  the registered  user of  the trade mark. It  appears to  us that  the purpose for wh ch fiction was created  by section  29(2) with  respect to a registered user was  to eliminate  all possibility  of trafficking in a trade mark  by a  person getting  himself registered  as the proprietor of a trade mark and thereafter going in search of some person  who will use it as the registered user thereof. Assuming that  the existence  of the special fiction created by section 29(2) cuts down the full operation of the general fiction enacted  in section  28(2), it  does not follow that the absence  of such  special fiction  in the  1958 Act will also cut  down the operation of the fiction in section 48(2) in the  same way by limiting it to the actual use of a trade

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mark only.  As pointed out earlier, in the 1958 Act wherever the phrase  "used by  him" occurs the fiction will apply. In other words,  the permitted  use of  a trade mark is, by the fiction enacted  in section  48(2), equated with "use by the registered proprietor". Consequently wherever the word "use" occurs with  all its  permutations and  commutations as  for instance in  phrases such as "proposed to be used by him" or ’intended to  be used  by him",  the fiction  will apply. At this stage,  it is  pertinent to  note that  form No.  TM-2, which  is   the  form  prescribed  for  an  application  for registration of a trade mark prescribed by the English Trade Marks Rules,  1938, was  substituted in  1982 and  under the substituted Form  a new  column is  provided which  requires details of  an application  under section 29(1) to be given. The old  Form No.  TM-2 did not contain this requirement nor does form  TM-l appended  to the Trade and Merchandise Marks Rules, 1959.      There is another vital point of distinction between the provisions of  the English.  Act and  those of  the 1958 Act relating  to  registered  users.  Under  the  1958  Act,  an application for  registration of  a trade  mark as  also  an application for 335 registering  a  registered  user  are  to  be  made  to  the Registrar and   it is the Registrar who has to grant both of them. The  Registrar would  refuse  the  application  if  it appears  to  him  that  the  grant  thereof  would  tend  to facilitate trafficking  in a trade mark. This question is to be considered  by the  Registrar himself.  The provisions of the 1958  Act were  the same  but the provisions or the 1958 Act are  radically different.  Under the  1958 . Act, though both the  application for  registration of  a trade mark and the application for registration of a registered user are to be made  to the  Registrar, the  Registrar has  the power to grant the  application for  registration of  the trade  mark only. So  far as the application for registering a person as a registered  user  is  concerned,  he  has  to  forward  it together with his report to the Central Government and it is for the  Central Government to decide whether to permit such application to  be granted  or not. In order to decide this, the Central  Government has to take into account the matters set out  in sub-section  (3) of section 49 and in rule 85 of the Trade Marks Rules, 1959. The matters to be considered by the  Central   Government  include   not  only  whether  the permitted use,  if allowed,  would amount  to trafficking in trade marks but also the interests of the general public and the development of any industry, trade or commerce in India. After the  Central Government  has taken  its decision,  the Registrar is  to dispose  of the  application in  accordance With the  directions issued by the Central Government. Thus, while under  the English  Act the  authority  to  decide  an application for registering a registered user is the same as the authority  for registering  a trade mark, under the 1958 Act they  are different  and so are the considerations which are to be taken into account-      Under the  1958 Act  an application  for registering  a registered user  can only  be made  after a  trade  mark  is registered. If  an intended  use by  a person  who  will  be registered user  is not  to be included in the legal fiction created by  section 48(2) it would make that fiction operate within  a   very  narrow   compass  and  almost  render  the provisions relating  to registered  users meaningless. It is in very  rare circumstances  that a person will get a  trade mark registered as proposed to be used By himself, use to no relation to the concerned goods, and thereafter permit it to

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be used by another as a registered user. It is also not open to everyone  who want  to register  a trade  mark to  form a company to  which after the trade mark is registered and the proposed company  is incorporated,  the trade  mark will  be assigned. These  things  are  not  practical  realities  and Parliament could not have intended such absurd results. The 336 argument of Dr. Gauri Shankar that the Appellant should have got the  trade mark  registered with  the intention  that it will itself  use the  trade mark  and in order to effectuate that intention  the Appellant  should have  set up a factory and manufactured and marketed the tablets ’DRISTAN’ and then either assigned  the trade  mark to the Indian Company or to get the  Indian Company registered as the registered user of that trade  mark is  illogical. By  reason  of  our  foreign exchange and  industrial policies  it is  not possible for a foreign company  to establish  its own industry in India. It can only  do 80 by entering into a collaboration with Indian entrepreneurs in  which the  foreign company  would  not  be permitted to  have more  than 40  per cent  shareholding and would be subject to other restrictions. Even assuming that a foreign proprietor of a trade mark were to be established an industry of  his own in India, it would be absurd to imagine that it  would thereafter  cease manufacturing the goods and allow someone  else to  do  80.  Equally  illogical  is  the argument of Dr. Dr. Gauri Shankar that the Appellant ant the Indian Company  should have jointly applied for registration of the  trade mark  ’DRISTAN’. The  Appellant was already in collaboration with the Indian Company. There was no need for it to  seek other  collaborators to establish a new company. To assign  the trade  mark to  the Indian Company or to make jointly  with   the  Indian   Company  an   application  for registration of the trade mark ’DRISTAN’ would be to destroy the appellant’s  proprietorship in  that trade  mark. It  is well-known principle  of interpretation  of statutes  that a construction should  not be  put upon  a statutory provision which would lead to manifest absurdity or futility, palpable injustice, or  absurd inconvenience  or  anomaly.  (see:  M. Pentiah and  Ors. v.  Muddala Veeramallappa  and Ors. [1961] S.C.R. 295,  303. The  Division Bench  of the  Calcutta High Court  saw   the  absurdity,   inconvenience  and   hardship resulting from  the construction which was placed by it upon section 48(2), as is shown by the passages from its judgment reproduced earlier.  It, however, forget the above principle of construction  and failed  to give  to the  legal  fiction enacted by section 48(2) its full force and effect.      The ’PUSSY  GALORE’ Trade  Mark Case  was a decision of the Board  of Trade and not of any English Court. As against that case,  we have  the  decision  of  the  High  Court  of Australia in  Aston v.  Harlee Manufacturing Company, (1959- 60) 103  C.L.R. 391,  on which  Fullagar, J., held (at pages 402-3) :           "I would  only  add  that  the  ’registered  user’           provisions of  the Trade Marks Act were introduced           in 337           1948, and  an intention to take advantage of those           provisions would,  in my  opinion, be a sufficient           ’intention to use’."      So far as the ’BOSTITCH’ Trade Mark Case relied upon by the Registrar  is concerned,  it has  no  relevance  to  the question which  we have  to decide.  It turned  upon its own facts and what was held in that case was that the provisions of section  28 of  the English  Act are  not  mandatory  but permissive.

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    The  high   Court  also  took  the  assistance  of  the Shavaksha Committee Report and the Ayyangar Report to enable it to  place the  construction which  it  did  upon  section 48(2). When  it was  intended to  revise the  1940 Act,  the Government of  India set up in 1953 that Trade Marks enquiry Committee under  the Chairmanship of Mr. K.S. Shavaksha, the then, Registrar  of Irade Marks. The Report of the Shavaksha Committee  was  made  in  1954.  The  Government  thereafter appointed Mr.  Alagiriswami, who  had acted as the Secretary of the  Committee, as  Special Officer  to  consider  L  the Shavaksha  Committee   Report,   and   he   made   his   own recommendations. The  Government, therefore,  felt that  the Shavaksha Committee  Report and  the recommendations made by the Special Officer should be further examined by a judicial authority  and   it  accordingly   appointed   Mr.   Justice Rajagopala Ayyangar  to examine the matter. Both the learned Single Judge and the Division Bench were of the opinion that the recommendation made in the Ayyangar Report were accepted by the  Government.  This  is,  however,  not  correct.  The Shavaksha Committee  had  recommended  the  insertion  of  a provision similar  to clause  (b) of  section 29(1)  of  the English Act  in section 36 of the 1940 Act which corresponds to section  45 of  the 1958 Act. The Ayyangar Report did not accept this  recommendation but had recommended the addition of a  provision to  the effect  that a registered proprietor should not  be entitled  to permit  use by  registered  user unless such  proprietor had  used the  mark in  relation  to goods in  the course  of trade  for a period of at least two years before the date of the application for registration of a  registered   user.  Parliament   did   not   accept   the recommendation  made  in  either  of  these  Reports.  These Reports, therefore,  cannot be  referred to for ascertaining the intention  of  Parliament  when  enacting  the  relevant provisions of the 1958 Act.      From what we have said above, we must not be understood to mean  that a  person, who  does not intend to use a trade mark himself  can get  it registered  and when faced with an application 338 under clause  (a) of  section 46(1)  to have that trade mark removed, turn  round and  say that  he intended  to  use  it through some person who was proposed to be got registered as a registered  user. This would clearly amount to trafficking in a trade mark. ’PUSSY GALORE’ Trade Mark Case could easily have been  decided on  the ground  that the applications for registration made  therein,  if  granted,  would  amount  to trafficking in  trade marks.  This has  been pointed  out in Halsbury’s Laws  of England,  Fourth Edition,  Volume 48, in footnote 6 to paragraph 30 at page 25.      In our  opinion, to  enable the  proprietor of  a trade mark who has got it registered on the ground that he intends to use  the trade  mark to  avail  himself  of  the  fiction created by  section 48(2),  he must  have had in mind at the date of his application for registration some person to whom he intends  to  allow  the  use  of  the  trade  mark  as  a registered  user.   This  would  eliminate  all  chances  of trafficking  in   a  trade   mark.  If   an  applicant   for registration did not have at the date of his application for registration a particular registered user in view, he cannot be said  to have  had a bona fide intention to use the trade mark and  in such  an event he cannot resist ar. application made under clause (a) of section 46(1) of the 1958 Act.      Turning now  to the  present Appeal,  the facts  on the record show  that only  when it  was  decided  to  introduce ’DRISTAN’ tablets  in the  Indian market  through the Indian

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Company that  the Appellant made its application to register the trade  mark ’DRISTAN’.  There was  a close connection in the course  of trade  between the  Appellant and  the Indian Company. The Appellant owned 40 per cent of the shareholding in the  Indian Company.  It had  entered  into  a  technical collaboration  agreement   with  the  Indian  Company  which provided for  strict quality  control and  for formulae  and services to  be provided  by the Appellant. The manufacture, marketing and  advertising of  all products  under the  said agreement were  to be  under the  control of  the Appellant. There was  no royalty  payable by  the Indian Company to the Appellant in respect of the use of the trade mark ’DRISTAN’. In the event of the collaboration agreement being terminated by reason of the happening of any of the events mentioned in the  said   agreement,  amongst   which   events   was   the shareholding of  the Appellant  becoming less  than  40  per cent, the  Indian Company  was to  cease to  be entitled  to manufacture the  tablets ’DRISTAN’  or to use its formula or to use  the trade mark ’DRISTAN’. There was here, therefore, no question  of any  trafficking in  a trade  mark. In these circumstances, the intention of the Appellant to use the 339 trade mark  ’DRISTAN’ through  the Indian  Company which was subsequently to get itself registered as the registered user of the  said trade  mark cannot but be characterized as bona fide.      Mr. Nariman,  learned Counsel  for the  Appellant, also urged that  in addition  to having  a bona fide intention to use the trade mark ’DRISTAN’, the Appellant had also used it within a  period  of  one  month  before  the  date  of  the Application for  Rectification. For  this  purpose,  learned Counsel relied upon the samples sent by the Appellant to the Indian Company. In the view which we have taken that the two conditions of clause (a) of section 46(1) are cumulative and that the  first condition  has not  been satisfied  in  this case, we find it unnecessary to consider this point.      It was  also submitted  by Dr.  Gauri Shankar,  learned Counsel for  the First Respondent that the Appellant was not entitled to  retain the trade mark ’DRISTAN’ on the register because it  had obtained  its registration by making a false statement in its application for registration inasmuch as it had not  stated in  the said application that the said trade mark was  proposed to  be used  by  a  registered  user  but instead stated  that it  was to be used by the Appellant who claimed to  be the  proprietor thereof.  This point  was not raised at  any time  before the  Registrar or the High Court and it  is not  open to  the First Respondent to take this E point for  the first  time in  this Appeal  by  certificate. Apart from  that, there  is no substance in this point. Form TM-l appended  to the  Trade and  Merchandise  Marks  Rules, 1959, does  not contain  any column similar to the column in the new  Form No.  TM-2 appended  to the English Trade Marks Rules, 1938. The relevant portion of Form TM-l is as follows :           " Application  is hereby  made for registration in           Part A(a)/B  of the  register of  the accompanying           trade mark  in class  (b) ....  in respect  of (c)           .... in  the name(s) of (d)...... whose address is           (e) ......... who claim(s) to be the proprietor(s)           thereof (and  by whom the said mark is proposed to           be used)  (f) or  (and by  whom  and  his  (their)           predecessor(s) in title (g) the said mark has been           continuously used since ..... 19..... ) in respect           of the said goods(h)." The Appellant,  therefore, cannot  be said to have practised

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any deception in stating in its application that it intended to use 340 the trade mark itself. In our opinion, it would be better if the Central  Government were  to amend  Form TM-l to require the applicant  to state whether he proposes to use the trade mark himself  or through  a registered proprietor and if so, to state the particulars of the proposed registered user.      It was  next sought  to be  argued by Dr. Gauri Shankar that  the   trade  mark   ’DRISTAN’  was   deceptively   and confusingly similar  to the trade mark ’BISTAN’ of which the registered  proprietor   is  M/s.  Prof.  Gajjar’s  Standard Chemical Works  Ltd. This  is not  one of the questions upon which the  certificate was  granted by the High Court and it is not  open to  the First  Respondent to take this point in this Appeal.  In any  event, this  point too  is without any substance. It  was rejected  by the  Registrar. The  learned single Judge did not deal with it. Though the Division Bench was of  the opinion that it was not necessary to decide that question, it recorded the facts relating thereto which would justify the  rejection of  that contention.  These facts are that though  the proprietor  of the said trade mark ’BISTAN’ had made an affidavit supporting the First Respondent in the proceedings for  rectification of  the Register  it had  not either opposed  the registration of the trade mark ’DRISTAN’ nor had  it  at  any  time  alleged,  apart  from  the  said affidavits that there would be any confusion or deception by the use of the trade mark ’DRISTAN’.      In  the   written  submissions   filed  by   the  First Respondent after  the hearing before us was concluded it was contended that  the Court’s  discretion should  be exercised against the  trade mark  ’DRISTAN’ remaining on the Register inasmuch as  to allow it so to continue would be contrary to the policy  of the  Central Government with respect to brand names belonging to foreign companies and also because two of the ingredients  used in  the formula for the manufacture of ’DRISTAN’ tablets were banned by the authorities. In support of  this   contention   copies   of   some   circulars   and notifications were filed along with the written submissions. This point was not at any time taken before the Registrar or the High  Court nor does the certificate granted by the High court cover  it. It  is not  fair to  produce copies  of any circular or  notification  along  with  written  submissions after oral  arguments have closed because the other side has no opportunity  to meet  this case. For ought we know, after some ingredients in the composition of the ’DRISTAN’ tablets were banned, the manufacturers may have changed the formula. We are  not concerned in this Appeal with this question. The application  for  registering  the  Indian  Company  as  the registered user of the 341 said trade  mark is  still  pending  and  when  the  Central Government comes  to  consider  that  application,  it  will decide the  matter for  itself. After all, the best guardian of the  policy of  the Central  Government  is  the  Central Government itself and not a private limited company, namely, Mac  Laboratories  Private  Limited,  the  First  Respondent before us,  which has  a vital  interest in having the trade mark ’DRISTAN’ removed from the Register.      For the  reasons given  above, this Appeal must succeed and is allowed and the judgment of the Division Bench of the Calcutta High  court appealed  against is  reversed and  the order passed  by it  is set  aside. Consequently, Appeal No. 165 of 1968 filed by the Appellant before the Division Bench of the  Calcutta High  Court is  allowed with  costs and the

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judgment of  the learned Single Judge of that High Court and the order  passed by  him are  reversed and  set aside. As a result Appeal  No. 61  of 1965 filed by the First Respondent before the  learned Single  Judge of the Calcutta High Court is dismissed  with costs  and the  order of the Registrar of Trade Marks,  Calcutta, dismissing  the  First  Respondent’s Application for  Rectification  No.  CAL-17  with  costs  is confirmed.      The First  Respondent will  pay to  the  Appellant  the costs of this Appeal. A.P.J.                                       Appeal allowed. 342