In the case of Patel Field Marshal Agencies Ltd. vs PM Diesels Ltd & Ors the supreme court has solved an important question of law in the Trade Marks Act. The relevancy of section 46 and section 56 on hand and on other the interplay between section 107 and section 111 of the Trade and Merchandise Mark Act, 1958 is dealt by the bench of Justice Ranjan Gogoi and Justice Navin Sinha.
Section 46 of the act provides for the removal of any registered trademark on the ground that the mark was not applied with bonafide intention and the mark has not been used prior to one month of the removal application whereas the section 56 of the act gives the power to the tribunal or the high court to cancel the registration of the registered trademark if there is failure to observe any condition on which the trademark was registered. Further, when a suit for infringement of trademark is filed the question is raised regarding the validity of the trademark either by the plaintiff or the defendant. Section 107 of the act states that notwithstanding that the section 46 & section 56 of the act the application for rectification is to be filed before the high court and not before the registrar.
The section 111 of the act provides for the stay of proceedings when validity of mark is questioned. The section provides that if the application of rectification has been filed and is before the high court and the suit for infringement is filed during the pendency of the application then the suit proceedings shall be stayed. Section 111 also provide that if the suit of infringement is filed when there is no application for trademark is pending but the issue has been found tenable the suit shall be stayed for three months.
The question in the present case was whether the failure to pursue the rectification under section 107 and section 111 will foreclose the right to party to individually proceed under section 46 read with section 56 of the act. The Supreme Court answered the issue by stating that independent procedure for rectification was not maintainable once the issue was abandoned in the suit.
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