Although the clash over 'Khadi' between the German company Khadi Naturprodukte and Khadi and Village Industries Commission (KVIC) is far from resolution, the latter has already filed another suit, this time against Fabindia for writing 'Khadi' over its products.

The KVIC claims an exclusive right over the use of the mark 'Khadi', as it secured the registration of the said mark and has been using it for a few products since 1978. Considering the history and origin of Khadi it is debatable if Khadi should continue to hold the status of a registered trademark or it should instead be considered as a Geographical Indication (GI).

History of Khadi

Khadi or Khaddar is an Indian homespun cotton cloth. The handspun yarn which was used for the making of this cloth was of poor quality but expensive. The mill owners in order to create a monopoly denied the opportunity to the handloom weavers to buy yarn. Mahatma Gandhi initiated the 'Khadi Movement' in which he used the Spinning Wheel (Charkha) himself to make cloth out of handspun yarn and also encouraged others to do so. He also made it mandatory for the members of the Indian National Congress to spin cotton themselves. It became popular and an integral part of the Indian independence movement. Mahatma Gandhi also made an effort to create organisations at the grass-root level to boycott the foreign cloth as the British Raj was buying cotton from India at a cheap price and use the cotton to manufacture the cloth and sell it at a very high cost. Mahatma Gandhi promoted Khadi for the self-reliance and self-employment instead of using the British manufactured cloth. Khadi is also recognised by many of the prominent dictionaries as a hand spun fabric from India.

'Khadi' as a Trademark

The Government of India wants to promote Khadi as an "Indian Brand" globally. As already mentioned above, KVIC alone can claim the rights and promote the mark as its own. KVIC is a non-trading body established under Khadi and Village Industries Commission Act, 1956. The purpose of KVIC was to promote, plan and organise the establishment and development of Khadi industries in the rural areas. Today KVIC holds registration for the word 'KHADI' and 'KHADI' formative marks in most of the classes of the trademark. Functions of KVIC are different from manufacturing of Khadi, yet it was able to secure the registration of the word 'KHADI' under the description of the non-trading body as 'manufacturers and merchant' of the products. It also claims to be the prior user of the mark since 1978.

The definition of trade description under 'The Trade Marks Act, 1999, Section 2(1)(za) "trade description" means any description, statement or other indication, direct or indirect –

(vi) as to the mode of manufacture or producing any goods or providing services;

(vii) as to the material of which any goods are composed.

The Khaddar (Protection of Name) Act, 1950 says that, "the words "Khaddar" and "Khadi" whether in Hindi or in any other Indian language or in English, when applied to any woven material, shall be deemed to be a trade description within the meaning of the Indian Merchandise Marks Act, 1889, (4 of 1889) indicating that such material is cloth woven on handlooms in India from cotton, silk or woolen yarn handspun in India or from a mixture of any two or all of such yarns".

Interpreting the above mentioned section it can be seen that though the act does not limit use of the word Khadi, the language used makes it clear that Khadi when applied to hand-woven cloth would be considered as a trade description. Even the section 2(d) of the Khadi and Village Industries Commission Act defines 'Khadi' as, "any cloth woven on handlooms in India from cotton, silk or woollen yarn handspun in India or from a mixture of any two or all of such yarns".

As 'Khadi' has already been registered as a trademark in numerous application made by KVIC, It cannot be ignored that in the light of above definitions that the registration in all cases might not be appropriate as it is well established that Khadi is a term used to describe handspun cloth and any merchant should be allowed to use the term to describe his goods and product as Khadi.

Khadi as a Geographical Indication

The Geographical Indication of Goods Act of 1999 states that, "geographical indication", in relation to goods, means an indication which identifies such goods as agricultural goods, natural goods or manufactured goods as originating, or manufactured in the territory of a country, or a region or locality in that territory, where a given quality, reputation or other characteristic of such goods is essentially attributable to its geographical origin and in case where such goods are manufactured goods one of the activities of either the production or of processing or preparation of the goods concerned takes place in such territory, region or locality, as the case may be". Khadi has been used in India to refer to hand-woven cloth for more than 80 years. Khadi has received recognition in many of the prominent dictionaries as a handspun fabric from India and hence the word has acquired a secondary meaning, as any other cloth not made in India, even though it might have been obtained by a similar method shouldn't be allowed to be called 'Khadi' as the word has now been associated with a geographical origin.

Intellectual Property Rights Attorney Association (IPRAA) has already filed for application of registration for Khadi as GI on behalf of all the producers and manufacturers of Khadi. If the registration to Khadi is granted, it will be in conflict with the Trademark registration of KVIC and may become invalid as per the section 25(a) of the GI act of 1999, which states that "Notwithstanding anything contained in the Trade Marks Act, 1999, the Registrar of TradeMarks referred to in section 3 of that Act, shall, suo motu or at the request of an interested party, refuse or invalidate the registration of a trade mark which- (a) contains or consists of a geographical indication with respect to the goods or class or classes of goods not originating in the territory of a country, or a region or locality in that territory which such geographical indication indicates, if use of such geographical indications in the trademark for such goods, is of such a nature as to confuse or mislead the persons as to the true place of origin of such goods or class or classes of goods"


Khadi has been an issue for quite some time in India. As already seen above, KVIC has claimed registration and shown a prior use of the mark 'Khadi' in some classes since 1978. The clash over Khadi mark between KVIC and Fabindia has taken a toll on KVIC as Fabindia and IPRAA, has pushed for the Khadi being a geographical indication. If GI registration for Khadi is granted the right of KVIC over the mark 'KHADI' will be cancelled. It'll be interesting to see the move that the trademark registry takes in granting a GI tag to Khadi however, even if Khadi is granted a GI tag , the KVIC may still be permitted to hold their trademark under Section 26 of the GI act which allows for registration of a GI as a Trademark in good faith.

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