"Registration vs. Prior Use: Comprehending Sections 12 And 34 Of The Trade Marks Act, 1999"

INTRODUCTION

In the present economy the utilization of trademarks has transcended from mere purposes of a symbol or name to representation of goodwill, reputation and a distinctive identity of a business or a firm. In today's world where markets are expanding and becoming more competitive day by day, trademarks have become an integral part of the prevailing commercial laws. In India, the Trade Mark Act 1999 governs and regulates the registration, protection and enforcement of trademarks. However, there exists a huge conundrum within this field of law that is the relationship between statutory rights derived from registration and common law rights derived from prior use of the impugned mark.

The Trademark Act 1999, provides two key provisions which cover this, i.e., Section 12 which talks about Bona fide Concurrent use and Section 34 that provides protection of prior user rights. Section 12 authorizes the registration of similar or identical marks when done in bona fide manner, while Section 34 ensures the rights of a prior user are not prejudiced by later registration of a similar or identical mark. This raises essential questions about the balance between promoting registration and providing safety to established market goodwill of a mark, making it a very important area of scrutiny in Indian Trade Mark Law.

LEGISLATIVE FRAMEWORK

The Trademark Act, 1999 is a primary legislation which governs and regulates the process of registration and protection of the registered trademarks in India. The Act combines both statutory rights through registration and common law rights through prior use in order to maintain an equilibrium between protecting the commercial goodwill and ensuring certitude in the trademark register. The main provisions which are revenant in understanding this are:

• Section 12 of the Trademark Act 1999 provides that "In the case of honest concurrent use or of other special circumstances which in the opinion of the Registrar, make it proper so to do, he may permit the registration by more than one proprietor of the trade marks which are identical or similar (whether any such trade mark is already registered or not) in respect of the same or similar goods or services, subject to such conditions and limitations, if any, as the Registrar may think fit to impose."¹
  
  It provides powers to the registrar of Trade Marks to allow the registration of the trademarks which are identical or have a similarity with marks which are already registered provided that the applicant of the mark showcases and proves that such adoption of the mark was bona fide & honest and that the mark is in use concurrently in the market. This provision takes into consideration the Indian diverse and widespread market where it can be very possible for two businesses to adopt a similar or identical mark and build a good reputation and goodwill around that mark in good faith and honesty. Under this provision, full discretion is given to the Registrar who can also impose limitations if he deems fit.
  
  Requisites for honest concurrent use of a trademark includes:

"In London Rubber Co. Ltd. v. Durex Products Inc., the dispute concerned the trademark "Durex." Although London Rubber claimed prior use in India since 1932, the Supreme Court upheld Durex Products Inc.'s registration under Section 10(2) of the Trade Marks Act, 1940, holding that honest concurrent use and special circumstances—such as genuine commercial use, long-standing international presence, and the public welfare nature of contraceptives—justified registration. The case is significant for clarifying the scope of honest concurrent use and special circumstances in trademark law."²

"In the case of Kores (India) Ltd. vs. M/s Khoday Eshwarsa and Son (1984), decided by the High Court of Bombay, herein, the petitioners, Kores (India), filed an application in respect of carbon papers, typewriting ribbons, and stencils for a trade mark consisting of a device of a typist girl at the typewriter, which was objected by the respondents under Section 9 of the Act as an identical device and the word "khoday" was already registered by the respondents.
According to Section 12(3) of the Trade and Merchandise Marks Act, 1958, the following facts were required to be taken into consideration while determining the registrability of a trade mark under such a provision:

• The genuineness of the concurrent use;
• The quantum of concurrent use of trade marks shown by the applicant having regard to the duration, area, and volume of trade and to the goods concerned;
• The probability of confusion resulting from the similarity of the applicant's and opponent's trade marks, as a measure of the public interest or public inconvenience;
• Whether any instances of confusion have on record been proved; and
• The relative inconvenience that may be caused to the parties concerned.

The High Court of Bombay decided that both trade marks used a similar device of a typist girl. The goods for which both trade marks were being used were identical and there was a likelihood of confusion among consumers due to the similarity of the trade marks and the identical nature of the goods. The overall expression of the devices was similar."³

"In a recent case of Lowenbrau AG v. Jagpin Breweries Ltd., the Delhi High Court dealt with a trademark dispute over the use of the word "Lowenbrau" for beer products in India. The plaintiff, Lowenbrau AG, claimed exclusive rights in the mark and sought an injunction against Jagpin Breweries. The Court, however, held that "Lowenbrau," meaning lion's drink in German, had long been used by multiple beer manufacturers in Germany and had thus become generic or public juris. It further noted that the plaintiff had failed to act promptly despite the defendant's ongoing use, which weakened its claim. Taking into account the descriptive nature of the word and the long coexistence of the parties in different jurisdictions, the Court accepted the defence of honest concurrent use under Section 12 of the Trade Marks Act, 1999, and declined to grant an injunction."⁴

• Section 34 of the Trademark Act 1999 states that "Nothing in this Act shall entitle the proprietor or a registered user of registered trade mark to interfere with or restrain the use by any person of a trade mark identical with or nearly resembling it in relation to goods or services in relation to which that person or a predecessor in title of his has continuously used that trade mark from a date prior—
  
  (a) to the use of the first-mentioned trade mark in relation to those goods or services by the proprietor or a predecessor in title of his; or
  
  (b) to the date of registration of the first-mentioned trade mark in respect of those goods or services in the name of the proprietor of a predecessor in title of his; whichever is the earlier, and the Registrar shall not refuse (on such use being proved) to register the second mentioned trade mark by reason only of the registration of the first-mentioned trade mark."⁵
  
  Section 34 of the Indian Trademark Act 1999 provides protection to the rights of a prior user of a trade mark which is similar or identical to an already existing mark. It states that a registered person can't interfere in the utilization of a similar or identical mark by a person who is the prior user of it. The rationale behind this section is for it to provide recognition to the trademarks which attain their value not from being registered but by the goodwill and reputation which they have acquired by the utilization of that mark. Therefore, even if a party has gotten its mark registered, it still can not supersede the rights of a prior user who has acquired the goodwill by prior use and establishment.

"In S. Syed Mohideen v. P. Sulochana Bai, the Supreme Court of India addressed the conflict between two parties, both holding registered trademarks for the term "Iruttu Kadai Halwa". The appellant, S. Syed Mohideen, had registered the mark in 2008, while the respondent, P. Sulochana Bai, had been using the mark since 1900 and registered it in 2007.

The Court emphasized the principle that prior use rights supersede registration rights. It held that the respondent's long-standing use of the mark conferred superior rights over the appellant's later registration. The Court also clarified that the statutory rights conferred by registration are subject to the rights of prior users, as outlined in Section 34 of the Trade Marks Act, 1999.Consequently, the Supreme Court upheld the High Court's decision in favour of the respondent, reinforcing the precedence of prior use in trademark disputes."⁶

INTERRELATIONSHIP BETWEEN SECTION 12 AND 34

Sections 12 and 34 of the Trademark Act 1999, prima facie addresses different issues however they are very interrelated in practical aspects. At their very core, both the provisions aim to reconcile the conflict between statutory registration rights and the rights of a prior user who has established reputation and goodwill in that mark.

S12 recognizes the present reality where in India due to diverse and huge market, a business may have identical and similar trademarks with an existing mark and they can register the same provided its bona fide, in good faith. It basically permits and allows coexistence of such marks on the register subject to certain limitations and conditions such as no exclusivity rights over one another and same rights against third party provided under Section 28⁷

However, Section 34 ensures that such registration does not undermine the rights of earlier user. It is provided that even if a person has secured registration under section 12, the rights of the earlier user still supersede because the of principle that "priority in adoption and use prevails over priority in registration."

"In M/s. L. D. Malhotra Industries v. M/s. Ropi Industries, I.L.R. 1976 (1) Delhi 278, the Delhi High Court decisively reaffirmed the principle that "priority in adoption and use prevails over priority in registration." The dispute involved two dress hook manufacturers, Malhotras and Ropis, both claiming rights over the mark "Kismat." While Malhotras obtained registration in December 1967, Ropis had been using the mark in commerce since April 1963 and applied for registration later. The Court, through Avadh Behari, J., held that use is paramount, noting that a trader acquires rights in a distinctive mark simply by putting it into commercial use, regardless of the date of registration. Registration under the Trade Marks Act does not create new rights but facilitates enforcement and provides a public record of rights. Consequently, common law rights of prior users remain fully protected, and earlier use gives superior rights over subsequent registration."⁸

"In Neon Laboratories Ltd. v. Medical Technologies Ltd., the Supreme Court addressed a trademark dispute between Neon Laboratories' "ROFOL" and Medical Technologies' "PROFOL", both used for the pharmaceutical drug Propofol. Neon Laboratories had obtained registration of "ROFOL" in 2001 but commenced actual use only in 2004, while Medical Technologies had been using "PROFOL" in the market since 1998 and filed for its registration the same year. The Court emphasized that prior use in commerce confers superior rights over mere registration, applying Section 34 of the Trade Marks Act, 1999, which protects prior users against later-registered proprietors. It held that Medical Technologies' earlier use established superior rights, and a temporary injunction was upheld to restrain Neon from using "ROFOL" in a manner that could infringe those rights. The case reaffirmed that actual market use is critical in establishing and protecting trademark rights in India."⁹

CHALLENGES AND CRITICAL ANALYSIS

The nexus between Section 12 and 34 indicates the attempt to strike an equilibrium but it includes a no. of challenges for its implementation. Section 12 provides for a provision that safeguards the rights of persons who in bonafide manner applied for the registration of their mark which is similar to an already existing mark however, Section 34 preserves the paramountcy of the prior users which ensures that merely registering a mark does not lead to extinguishment of vested goodwill in that mark.

One of the biggest challenges which the nexus of these section faces is the confusion among the public at large. Authorizing concurrent registration of identical marks in a nation like India where a lot of customers are brand oriented and buy products merely by looking at the marks shall lead to misleading. Although the registrar is empowered to use his discretionary powers to impose restrictions but such is not enough in a dynamic marketplace. Furthermore, if multiple similar marks are registered it will undermine the rights of exclusivity among owners and the reliability of the register itself as it would pose unnecessary complications in due diligence.

The protection granted to prior users under section 34 can lead to discouragement among business owners who comply with the provisions for registration of their mark under section 18. Unlike in EU where registration is paramount, in India emphasis is placed on the utilization of the mark which makes the enforcement unpredictable.

The provisions provided under Section 12 and 34 may promote fairness but they pose even greater ambiguousness between encouraging registration and protecting the interests of prior users. The main challenge which is very evident in Indian Trademark Act 1999 is that there exists no clear balance between these provisions which creates ambiguity among the business entities.

CONCLUSION

The Indian Trademark Act 1999, does indeed provide protection of both kinds, under statutory provisions of registration and common law protection through use.

Section 12 of the Act acknowledges that is honest and bonafide concurrent use is the commercial reality in today's dynamic market place and further provides authorization for the coexistence of the similar and identical marks under certain limitations as per the registrar's discretion. However, Section 34 reinforces the principle that the prior use of a mark shall supersede mere registration of marks while determining the actual proprietor of similar marks. It ensures that no registration of a mark can override the goodwill that is established by an earlier user of the mark.

These provisions embody a balance between fairness to honest traders and protection of the vested rights in a mark. However, it does lead to certain challenges like consumer confusion and sanctity of the trademark register. With the perpetual rise in the volume and complexities of trademark disputes, the judicial interpretations will play a crucial role in shaping the Indian Trademark jurisprudence and its interplay would be very essential for developing protection of brand identities.

Footnotes

1 https://www.indiacode.nic.in/bitstream/123456789/15427/1/the_trade_marks_act,_1999.pdf

2 London Rubber Co. Ltd. v. Durex Products Incorporated, 1963 SCC OnLine SC 223

3 https://indiankanoon.org/doc/1226902/

4 https://indiankanoon.org/doc/276675/

5 https://www.indiacode.nic.in/bitstream/123456789/15427/1/the_trade_marks_act,_1999.pdf

6 S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683

7 https://www.indiacode.nic.in/bitstream/123456789/15427/1/the_trade_marks_act,_1999.pdf

8 L.D. Malhotra Industries v. Ropi Industries, 1975 SCC OnLine Del 172

9 Neon Laboratories Ltd. v. Medical Technologies Ltd., (2016) 2 SCC 672

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