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Judgment
Raghbir Singh, J
The petitioner filed O.P. No. 405/03 under Section 56 read with Sections 107 and 108 of the Trade and Merchandise Marks Act, 1958 (hereinafter
referred to as the Act) in the High Court of judicature at Madras and the same has been transferred to this Board in terms of Section 100 of the
Trade Marks Act, 1999 and numbered as TRA/43/04/TM/CH.
According to the petitioner referred to above, in 1945 one Shri P. Iya Nadar conceived and popularised and brand 'CAMEL' and got the same
registered under No. 109120 dated 4.4.1945 for being used for safety matches under the name and style of South Indian Lucifer Match Works. There
are certain events whereby the said proprietary concern was converted into a partnership firm and ultimately reverting back to a proprietary concern,
which events are not material for the present case excepting that the issues relate to parties who are part of the same family owing its origin to Shri P.
Iya Nadar. Shri Iya Nadar by a deed of settlement dated 1.10.1980 transferred the ownership of the trade mark to a public charitable trust under the
name of P. Iya Nadar Charitable Trust. On a request in form TM-24 dated 12.6.1981, the Registrar by an order dated 2.4.1984 registered the mark in
the name of public charitable trust. The said trust applied for another trade mark 'CAMEL' for card board safety matches in class 34 and the same
was registered under No. 439372 dated 24.6.1985. The said mark was treated in association with earlier registered mark No. 101920. A deed of lease
dated 1.4.1983 was executed between the respondent trust and the petitioner by which the entire business including the plant and machinery and land
and building were given out on lease to the petitioner for a period of five years on an agreed rental. The said lease has been periodically renewed and
the last such renewal was dated 31.3.2003 making the lease valid for a period of 20 years from 1.4.2003 to 31.3.2003 on a rental of Rs. 75,000 per
annum. With the demise of Shri Iya Nadar on 27.12.1982, there had been frictions and disputes in respect of family properties and businesses amongst
the children of Shri Iya Nadar. The petitioner has submitted that it had been sub-contracting of manufacturing of safety matches with the 'CAMEL'
brand with various other manufacturing facilities to various units detailed by it in the petition which are held by the members of the family of late Shri
iya Nadar and some others. The petitioner alleges that recently respondent No. 1 has issued certain notices to sub-contractors for having not paid
royalty allegedly due and payable to respondent No. 1. The petitioner has submitted that it has taken advice from trade marks specialists recently and
has been advised that the very registration of the mark in favour of the respondent trust by a deed of settlement dated 2.10.1980 is ultra vires of the
Act, in particular in matter of Section 6(2) of the Act which provides that ""No notice of any trust, express or implied or constructive, shall be entered
in the register and no such notice shall be receivable by the Registrar"". The petitioner alleges that the 'CAMEL' brand safety matches are
manufactured and sold by not less than 30 units in Tamil Nadu only, some of which are owned and operated by family members of late Shri Iya Nada.
Thus the device is being allowed to be diluted. The petitioner has submitted for the expunction of the registered mark 'CAMEL' under registration No.
109120 and 439372 both in class 34 in respect of safety matches and card board safety matches on the ground that their registration in itself is in
violation of the provisions of Section 6(2) of the Act. The respondent has no legal right to maintain the mark and it has no intention to use the same
and it is only interested in trading with the mark for consideration by way of lease or royalty. Through such indiscriminate usage by several parties, the
very distinctiveness of the mark has been lost completely.
In the counter-statement filed on behalf of the first respondent certain preliminary objections have been raised to the filing of the petition. It has
been submitted that the petitioner is estopped to dispute the respondent's absolute right as proprietor over the trade mark 'CAMEL' since he had been
acknowledging its right since 1980. The petitioner being lessee cannot take advantage of its own wrong. The petition is barred by limitation as the right
of the first respondent over the trade mark 'CAMEL' has been unequivocally acknowledged and accepted by the petitioner over a period of 23 years.
The persons who manage the petitioner company and the first respondent trust are close relatives and belong to the family of late Shri Iya Nadar. The
present dispute is only an offshoot of ongoing disputes within the family. The first respondent has given details of 25 factories established by Shri Iya
Nadar and his family members who are using the trade mark 'CAMEL'. The first respondent has filed various suits for the recovery of royalty in
different civil courts which are still in progress'. The first respondent has also given details of the various suits filed against the 17 manufacturing units
mentioned by the petitioner in his petition. All these units are held by the family members of late Shri P. Iya Nadar. The first respondent has disputed
the interpretation raised by the petitioner in matter of Section 6(2) of the Act. It is fallacious. All the 30 units held by the petitioner in the State of
Tamil Nadu using the brand 'CAMEL' are owned and operated by the family members of late Shri Iya Nadar on the basis of permission from the first
respondent trust. There are only a few infringers including the units established by Shri V. Ramamurthy and action against those infringers as and
when occasion arises had been initiated by the first respondent through civil and/or criminal proceedings. Thus, the charge of trafficking in the
'CAMEL' trade mark is false and groundless. The petitioner being the beneficiary of the first respondent trust cannot be permitted to maintain the
petition on the principle of equity, justice and good conscience and in particular under the principle of estoppel. Petitioner filed his reply and evidence in
the form of affidavit on 2.8.2004.
The petition was taken up for arguments on 25.10.2004 in the sitting of the Board held at Chennai. Learned counsel Shri P.S. Raman appeared for
the petitioner and learned counsel Shri Satish Parasaran appeared for the first respondent.
Learned counsel for the petitioner basing his arguments upon the pleas raised in the petition submitted that the first respondent is indulging in
trafficking of the mark and thus the mark is diluted. It has lost its distinctiveness. Furthermore, he submitted that the first respondent cannot own the
mark being a trust in view of the provisions contained in Section 6(2) of the Act. Learned counsel for the first respondent submitted that the first
respondent is a trust consisting of all family members. He re-emphasised the submission made in para 14 of the counter-statement of the first
respondent submitting that the petitioner having derived the rights from the first respondent trust is estopped from questioning the title of the first
respondent trust in 'CAMEL' trade mark. He drew our attention to para 11 of the counter-statement wherein genesis of the family disputes leading to
the present application for rectification has been given. He made a mention about para 8 of the counter-statement wherein details of the 25 factories
set up by Shri Iya Nadar was been given which he allowed to one or the other of his children. Learned counsel for the first respondent submitted that
since most of the units making use of the trade mark 'CAMEL' are within the same single family belonging to Shri Iya Nadar and thus there is no
dilution of the mark and whenever there had been any, unauthorised use of the mark, the first respondent has promptly taken action against such units.
The issues involved in this matter broadly concentrate upon two aspects of the case.
(a) Whether the first respondent can validly hold the trade mark in view of provisions of Section 6(2) of the Act;
(b) Whether the first respondent has indulged in trafficking resulting into any dilution of the mark.
First respondent with a view to support his plea of estopped in the matter put reliance upon para 215 of the Law Relating to Estoppel by
Representation, Butterworth 1977 edition. It lays down that a licencee who has used and enjoyed a licence granted to him by the owner of the patent,
like a tenant who has been let into possession of the premises demised to him, or a bailee who has received the goods on a bailment, is deemed to
acknowledge the title of his licensor, and the validity of the patent, by the mere act of accepting the licence, as much as he is by any express recitals
and representations to that effect which may be contained in the instrument whereby the licence is conferred, and he is accordingly estopped, as
against the licensor, from afterwards disputing such title or validity by setting up that the patented invention was not used, or was not useful, or that the
patentee was not the first and true inventor thereof, or that the specification was defective or was not enrolled within the period prescribed by the
statute, or on any other grounds. Learned counsel for the first respondent argued and cited the dictum laid down by Justice Lakshmanan, the then
Judge of Madras High Court, in K.R. Jadayappa Mudaliar trading as Sarasu Match Works v. K.B. Venkatachalam trading as Golden Match
Industries, MLJ 1990 Madras 423 wherein the learned Judge laid down that the mark remaining on the Register without any blemish and use thereof
makes it distinctive. It was further held that by mere use of mark by certain unregistered users, the mark does not become public juris. Learned Judge
further emphasised that in case general permission to affix trade mark labels is given-it does not result into trafficking. In totality the conclusions in
that case lead to support first respondent's claim that the first respondent is registered as a proprietor on the Register of Trade Marks. The mark is in
continuous use by persons under the authority of the registered proprietor and wherever there had been any unauthorised use thereof, appropriate
action has been taken against infringers by the first respondent. First respondent drew our attention to the list of proprietors/partners/trusts using the
mark who are direct in lineage to late Shri Iya Nadar.
Learned counsel for the petitioner failed to support his claim for the alleged large scale trafficking of the mark by the first respondent. The plain
meaning interpretation of the language of Section 6(2) leads to no interpretation other than that it is not intended to create prohibition of trust being
registered as the proprietors of the trade mark. It is with a view to provide an exclusion about the registration of any information relating to the
equitable relationship which the registered proprietor, being a trust, may have with another person. The provision in the Act is based upon similar
precedents available in other corporate laws. Section 153 of the Companies Act, 1956 makes a provision exactly on the same lines in relation to the
register of members or of debenture holders of the company. Section 153 of the Companies Act, 1956 again has its linkage to similar provisions in the
English Company Law. The provisions had been interpreted by the Courts and the proposition of the law in this regard is well settled as under in re,
Parkins, (1890) 24 QBD 613 Per Lord Coleridge, C.J.
It seems to me extremely important not to throw any doubt on the principle that companies have nothing whatever to do with the relations between
trustees and their cestui que trust in respect of shares of the company. If a trustee is on the company's register as a holder of shares, the relations
which he may have with some other person in respect of the shares are matters with which the company has nothing whatever to do; they can look
only to the man whose name is on the register"" In the same case Lord Esher M.R. put it: ""the law has given the company the right to say we do not
care whether you are a cestui que trust or not; if you are, we have a right to take no notice of you.
Provisions in the nature of ""Trust not to be entered on register"" whether in Section 6(2) of the Trade and Merchandise Marks Act, 1958 or Section
153 of the Companies Act, 1956, are only with a view to avoid the liability of the Registrar of Trade Marks or the company in matter of inter vivos
relationship of the trustee and the cesti que trust.
Learned counsel for the first respondent drew our attention to the case of Amrit Banaspati Company Limited, (1994) 4 Comp LJ 101 (CLB)
wherein the Company Law Board directed the company to form a trust and transfer certain shares involved in that case in the name of the trust, thus
leading to recognizability of the trusts as shareholders on the Register of shareholders. In a matter decided by the Company Law Board, Estern
Region Bench, Chennai on 26.9.2000 in the case of Smt. Sulochana Nathany v. Hindustan Malleables & Forgins Ltd., C.P. 10/1995 C.A. Nos.
56/1998 and 8 of 2000, the Company Law Board recognised the ownership of trusts as shareholders. In Shantaben Karasanbhai Patel and Ors. v.
S.C. Jain and Anr., 2001 (2) CTMR 47, a case decided by Hon'ble Mr. Justice A.K. Sikri of Delhi High Court wherein the plaintiffs were the trustees
and registered as proprietors of the trade mark on the Register of Trade Marks leading to recognition of the concept that the trust can validly be
registered as a proprietor of trade marks and it does not suffer from any disqualification on that score under Section 6(2) of the Act. Indicentally, it
shall not be out of place to quote an order passed by the Trade Marks Registry in Chinar Trust v. Usha (India) Limited, 1999 PTC (19) 688 wherein
the learned Assistant Registrar has observed that he had found a large number of trusts on the Register as holders of trade mark registration and in
any event the trade mark is a property and a trust can be a holder of a trade mark just like any other property. It shall be worthwhile to mention herein
that a practice has grown in the Trade Marks Registry to register the names of trustees through which the concerned trust operates and that is only
with a view to protect the interest of the trusts and it has nothing to do with as such the eligibility or otherwise of the registration of the trust as the
registered proprietor of the trade mark.
In view of the above, we are of the view that the petitioner fails on both grounds as to the dilution of the trade mark and loss of distinctiveness as
argued by it and also the non-registrability of a trust as trade mark in view of the provisions of Section 6(2) of the Act. Accordingly we dismiss the
petition with no order as to costs.