T.T.Ltd. Vs Union of India (Madras High Court)
The Madras High Court disposed of four writ petitions challenging separate orders dated 22.02.2018 passed by the Regional Director, Ministry of Corporate Affairs, rejecting the petitioner’s applications under Section 16(1)(a) of the Companies Act, 2013 seeking rectification of the names of the respective third respondent companies on the ground that their names were identical with or too nearly resembled the petitioner’s name.
The petitioner contended that the impugned orders were passed without proper application of Section 16(1)(a) of the Companies Act, 2013. According to the petitioner, unlike Section 22(1)(ii)(b) of the Companies Act, 1956, Section 16(1)(a) does not prescribe any limitation period. It was submitted that the Companies Act, 2013 came into force on 01.04.2014, replacing the Companies Act, 1956, and that the applications under Section 16(1)(a) were filed in May 2017, prior to the Ministry of Corporate Affairs General Circular No. 04/17 dated 16.05.2017. The petitioner further argued that the Circular applied only to applicants whose earlier applications under Section 22(1)(ii)(b) of the Companies Act, 1956 had been rejected on limitation, whereas the petitioner had never invoked that provision. It was also asserted that the petitioner had been incorporated in 1978 and that its founder had been a registered trademark user since 1964, whereas the respective third respondent companies were incorporated subsequently.
The respective third respondents opposed the writ petitions, stating that they had been incorporated under the Companies Act, 1956 and that their names were bona fide derived from the initials of T.T. Krishnamachari and his descendants. They referred to their long-standing business presence, goodwill and use of the “TT” mark in logistics, insurance, aviation and other services. They also pointed out that the petitioner had earlier instituted trademark suits before the Delhi High Court seeking to restrain use of “TT Services” and “TT Logistics”, which were dismissed on merits on 20.02.2013. Appeals filed by the petitioner were subsequently withdrawn. The third respondents further contended that the petitioner was attempting to re-agitate the same issues and that the applications were barred by principles of res judicata.
The Regional Director had rejected the applications on four principal grounds. First, the findings of the Delhi High Court in the earlier trademark litigation had attained finality and barred the applications under the principle of res judicata. Secondly, the respondent companies had been incorporated under the Companies Act, 1956, under which Section 22 permitted rectification only within the prescribed period, and the Central Government could not exercise such power under Section 16(1)(a) of the Companies Act, 2013 after the expiry of that period. Thirdly, Section 16(1)(a) conferred only a suo motu power on the Central Government, making private applications under that provision not maintainable. Fourthly, General Circular No. 04/2017 dated 16.05.2017 clarified that omission of the limitation provision in Section 16(1)(a) did not revive claims that had already become barred under Section 22 of the Companies Act, 1956.
The High Court examined the legislative framework under Section 22 of the Companies Act, 1956 and Section 16 of the Companies Act, 2013. It observed that while Section 22 expressly prescribed a limitation period of twelve months for exercise of the Central Government’s power, Section 16(1)(a) omitted such express limitation. However, the Court held that absence of an express limitation period does not permit exercise of statutory powers at any time without restriction. Referring to the principles governing limitation and public policy, the Court observed that where no limitation is prescribed, statutory powers must nevertheless be exercised within a reasonable period. It relied upon the Supreme Court’s observations in Mohamad Kavi Mohamad Amin vs. Fatmabai Ibrahim and noted that the same principle had also been followed in Union of India and another vs. Citi Bank N.A.
The Court observed that the respective third respondent companies had been incorporated in 2000 and 2007, whereas the petitioner filed applications under Section 16(1)(a) only during 2016 and 2017. It held that permitting rectification proceedings after such prolonged delay would be inconsistent with the legislative intent and the principles governing limitation. Accordingly, it upheld the Regional Director’s conclusion that the applications were barred by limitation.
The Court further held that Section 16 contains two distinct mechanisms. Section 16(1)(a) empowers the Central Government to act on its own opinion and confers only a suo motu power. Section 16(1)(b), on the other hand, specifically enables a registered proprietor of a trademark to apply for rectification where a company name resembles its registered trademark, subject to the prescribed limitation. The Court rejected the petitioner’s contention that applications could be maintained under Section 16(1)(a), holding that such an interpretation would effectively confer dual remedies upon a registered trademark proprietor contrary to the statutory scheme. The Court also held that previous instances in which the Regional Director had entertained similar applications did not constitute binding precedents.
The Court further observed that, having failed to secure interim relief before the Delhi High Court in the trademark litigation, the petitioner had subsequently invoked Section 16(1)(a). It held that the Regional Director was justified in relying upon the earlier findings of the Delhi High Court and in rejecting the applications on the ground of res judicata.
The Court also noted that although the impugned orders were passed on 22.02.2018, three writ petitions were filed only in 2020 and the fourth in 2022. It held that the writ petitions were also liable to be rejected on the ground of laches. Finding no merit in any of the challenges, the High Court dismissed all four writ petitions without costs.
Cases Discussed
- Union of India and another vs. Citi Bank N.A. (Supreme Court), Civil Appeal No.9337 of 2010 dated 24.08.2022
- Mondelez Foods Private Limited Vs. The Regional Director (North), Ministry of Corporate Affairs (Delhi High Court), W.P.(C) No.5289 of 2014 and C.M.No.10518 of 2014
- Mohamad Kavi Mohamad Amin vs. Fatmabai Ibrahim (Supreme Court), (1997) 6 SCC 7
- Intelgain Technologies Pvt. Ltd. Vs. Regional Director and Another (Bombay High Court), 2014 (1) ALL MR 87
- MRC Logistics Private Limited Vs. Regional Director and Another (Bombay High Court), 2009 SCC Online Bom 769
- Lords Insullations India Private Limited Vs. The Regional Director, Department of Company Affairs and Another (Madras High Court), 2005 (1) CTC 34
- Wander Ltd. and Another Vs. Antox India P. Ltd. (Supreme Court), 1990 (Supp) SCC 727
