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Understanding Geographical Indications

The document discusses the historical context and definition of geographical indications (GIs). GIs originated from appellations of origin, which were first mentioned in the 1883 Paris Convention and sought to protect names like "Champagne" that indicated quality/characteristics due solely to geographical origin. The TRIPS Agreement broadened protection to geographical indications, which identify goods originating from a place and have qualities due to that place. India protects GIs through registration under the Geographical Indications Act, which provides an exclusive right to registered GIs against unauthorized use. The purpose of GIs is to protect the reputation of products associated with places and allow consumers and producers to benefit from that linkage.

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0% found this document useful (0 votes)
16 views18 pages

Understanding Geographical Indications

The document discusses the historical context and definition of geographical indications (GIs). GIs originated from appellations of origin, which were first mentioned in the 1883 Paris Convention and sought to protect names like "Champagne" that indicated quality/characteristics due solely to geographical origin. The TRIPS Agreement broadened protection to geographical indications, which identify goods originating from a place and have qualities due to that place. India protects GIs through registration under the Geographical Indications Act, which provides an exclusive right to registered GIs against unauthorized use. The purpose of GIs is to protect the reputation of products associated with places and allow consumers and producers to benefit from that linkage.

Uploaded by

rahul rasve
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Geographical Indications

Historical Context, Meaning, and Definition


Geographical Indications (hereinafter, GI) owe their origin to a lesser known concept -
Appellations of Origin. Appellations of Origin first find mention in the Paris Convention for
Protection of Industrial Property, 18831, although the convention does not define the term. It
merely uses the term in conjunction with the term ‘indications of source’, and obliges member
countries to repress the use of false indications of source and acts which mislead the public
regarding ​inter alia the characteristics of the goods through legal remedies such as seizure of
goods.2

The inclusion of indications of source and appellations of origin in a Convention meant to


protect what was yet to be recognized as intellectual property, was a result of the struggle of a
group of wine producers from the region of Champagne, who sought to preserve the reputation
of the name of Champagne from misuse by wine producers from other localities, which started
sometime in the mid 19th Century.3

Around that time, trade marks were a recognized industrial property capable of being protected
through legal remedies and civil suits. However, the law of trade marks had developed in a
manner which sought to exclude the names of localities/regions/cities from becoming the
monopoly of an individual, as many traders and businessmen could lay claim to a valid use of the
name of the place of their establishment as a trade name/mark. Paris Convention reflects this
understanding in Article 6quinquies(B) where it provides that a mark is devoid of distinctive
character when it serves to designate the place of origin of the product, and a member country is
not obliged to protect it.

At the same time, a new understanding had developed about certain names of geographical
regions which had a reputation of their own with regard to certain products grown there. The

1
​[Link]
2
Article 10,10bis, and 10ter of Paris Convention.
3
​[Link]
chief of such products was sparkling wine, which was being referred to as Champagne by its
manufacturers. In 1845 a group of Champagne Houses (producers of sparkling wine from the
region of Champagne successfully got the protection of the French Court of Cassation for the
name of ‘Champagne’, as the Court banned the use of the name Champagne as a generic name
for sparkling wines.4 The reason was that while sparkling wines manufactured in other regions
were made from the same method that was used in Champagne, the grapes grown in the region
of Champagne had a unique quality to them not found in grapes grown in other regions, and thus
the sparkling wine made in Champagne was different from sparkling wines made elsewhere. It
was the Champagne wine that had a reputation in other parts of Europe, not just any sparkling
wine. The intention of the group was to protect this reputation, and prevent others from trading
on it.

This led to the development of the concept of Appellations of Origin, which are names of places
where a certain product is grown, and the quality, or characteristics of the product is essentially
or exclusively attributed to the geographical origin of the product, due to unique climatic and soil
conditions of the geographical area. The wine producers of Champagne eventually organized
themselves into an association which not only protects the name of Champagne from becoming
generic in reference to sparkling wine, but also ensures that all such sparkling wine
manufactured under the label of Champagne meets the set standards of quality. Much of the law
surrounding Appellations of Origin is a result of the initiatives of this group.

These initiatives for stronger protection to Appellations of Origin eventually culminated into the
Lisbon Agreement for the Protection of Appellations of Origin and their International
Registration5, which defines Appellations of Origin as ‘the geographical denomination of a
country, region, or locality, which serves to designate a product originating therein, the quality or
characteristics of which are due exclusively or essentially to the geographical environment,
including natural and human factors.’6 The agreement also provides for international registration

4
​[Link]
5
​[Link]
6
Article 2(1) of Lisbon Agreement.
of such appellations, obliging every member country of the Lisbon Union to protect the
appellations so registered.

The Lisbon Agreement and the Union however was not popular, as apart from wines, cheeses,
and certain types of meat, the European countries did not have many products that needed the
protection of appellations of origin, and while developing and least developed countries had
many such products whose reputation was linked to the place of origin, the stringent definition of
appellations of origin excluded most of them, as the characteristics/quality of the products was
not directly linked to the geographical origin.

When the negotiations for TRIPS Agreement started during the Uruguay Round of Trade
Negotiations in 1984, the inclusion of appellations of origin amongst the intellectual properties
that the Agreement would protect was controversial, mainly for the reasons that the developing
and least developed countries recognized that they have a wealth of products that could benefit
from the protection of the names of their places of origin, but the definition of appellations of
origin was not conducive for that result. The final text of the Agreement thus relaxed the
definition, leading to the creation of the concept of Geographical Indications, which has a
broader scope than Appellations of Origin, in that products whose reputation is linked to a
geographical area due to its geographical environment (including natural and human factors),
were also to be protected by member countries, as opposed to products whose
quality/characteristics must also be a result of the geographical environment.

The Agreement however differentiates between the protection available to GIs of agricultural
and handicraft products,and protection available to GIs of wines and spirits. The latter is more
stringent than the former, as it absolutely prohibits unauthorized use, whereas in the formal, the
likelihood of confusion/deception has to be established for protection against unauthorized use to
be available.

Article 22 to 24 of the TRIPS Agreement deals with GI protection and exceptions to it, and
obliges member countries to protect them either through a certification mark, or a sui generis
system. India provides for both schemes of protection. The Trade Marks Act 1999 provides for
registration of certification marks and their protection, whereas the Geographical Indications
(Registration and Protection) Act 1999 provides for registration of GIs and the protection
available to them.

The term ‘Geographical Indications’ is defined in section 2(1)(e). Following are the important
features of GI according to this section:

● GIs exist only in relation to goods, agricultural, natural, or manufactured.


● They identify goods as originating or manufactured in a particular region or locality.
● They identify these goods as having a quality, characteristic, or reputation.
● This quality, characteristic, or reputation is a result of these goods originating or
manufactured in the particular region or locality. In case of a manufactured product, it is
enough that either the production, the processing, or the preparation of the goods takes
place in the concerned region or locality.

The essential function of a GI is to protect the reputation of a product which originates in a


specific place, such that its superior attributes are known by a reference to the place where it
originates. For eg. If A goes to a marketplace to buy fruits, and a seller tells him that his oranges
are from Nagpur, A is going to be more inclined towards buying them, as the reputation of
oranges from Nagpur is well established. Consider what would happen if the oranges aren’t
actually from Nagpur and turn out to be sour. His most likely thought would be that oranges
from Nagpur have a hyped and undeserved reputation, though he might believe that he was
deceived. The former thought makes it likely that the next time he is going to be less inclined to
buy oranges from Nagpur, and the latter would make him wary of any claims of any seller of
oranges being from Nagpur, regardless of how genuine they are.

A registered GI tag however, consisting of a mark or a logo that can be affixed to the products
would enable the consumers to identify the products as in fact originating, from the place that
they are claimed to be originating. In essence, this is similar to the functions of a trade mark,
only they associate their products not to an individual or an entity, but to a location. If any person
now uses any reference to a location well known for the products that he is selling, but his
products do not actually come from this place, he can be prosecuted in a court of law for
infringement of rights in the registered GI.

Indeed, this is how the Champagne Houses of France were able to preserve and protect the
reputation of Champagne. One of their first actions was to prevent other manufacturers from
using the name of Champagne to market their sparkling wine, which led to the name Champagne
retaining its exclusivity and fetching a premium for producers entitled to use it. In adopting a sui
generis system for protecting such names of places, the Indian Government hopes to achieve a
similar result in respect of various products​.

Procedure for Registration of GI


The entire procedure is outlined in section 11 to 19 of the GI Act, 1999. The register of GIs is
divided into two parts, as per section 7. Part A contains the details of the registered GI, and the
applicant, whereas Part B consists of the details of the authorized users of the GI. To understand
this system, it is important to understand the concept of distinctivity of trade marks, and its
monopolistic nature.

Trade marks are owned by individuals or individual legal entities and cannot serve to designate
the place of origin of the product, amongst other things. The reason is that there may be
numerous trades located in one place, and each such trader would have the right to identify
himself and his products as originating in such a place. Therefore, the place of origin cannot
possibly serve to distinguish between different producers selling the same product, both located
in the same place, as each would have a right to use the name of the place in reference to his
product. Therefore, there should not exist a monopoly in that name.

The exception to this rule is that of acquired distinctiveness. If the product in association with the
name of the place, because of long use, has become identified as such, it acquired distinctivity,
and can perform the functions of a trade mark. In cases of Geographical indications, however,
there are still many local producers who can lay a valid claim to the use of the name of the place
in relation to their product, thus making trademark an unsuitable medium of protection. The GI
Acts rectifies this problem by allowing anyone with a valid claim to the use of a GI tag to
register themselves as authorised users in respect of that GI, thus sharing the monopoly amongst
those entitled to it.

Who can Apply


To register a GI, any association of people or producers, or any organization or authority
established by law which represents the interests of the producers of the concerned goods, can
apply to the Registrar for registration of the GI.

For registration as an authorised user, any person who claims to be a producer of the goods in
respect of which a GI has been registered can apply to the Registrar.

Contents of the Application


The application for the registration of a GI must contain the following:

● A statement of explanation regarding the connection between the geographical indication


and the goods grown in that locality, especially referring to the natural and human factors
present in the area and their direct link to the reputation, quality, or characteristics of the
product grown or made there.
● Class of goods to which the GI would apply.7
● Geographical map of the territory in which the goods originate or are made.
● Description of the GI tag - words, logo, caption, or a combination of any of these.
● Details of the proposed users of the GI, which will be initially registered in Part B of the
register.
● Any other document concerning information that the Registrar may require or prescribe.
● Details of the applicant, including an address for service in India, if the applicant is a
foreign entity.

7
The classification of goods is given in the Fourth schedule to the GI Rules.
[Link]
The application for registration of an authorised user should be accompanied by such statements
and documents as may be prescribed by the Registrar in order to determine the validity of the
claim made by the applicant, as to the entitlement to the use of the GI.

Both the applications must be accompanied by the prescribed fee. The application must be filed
in that registry within whose jurisdiction, the territorial area of the place of origin falls. If the
territorial area falls outside Indian territory, the registry within whose jurisdiction the address for
service falls is the appropriate office to file the application.

Steps of Registration
Once an application is received by the Registrar, it goes through the following steps:

A. Preliminary Examination8: The Registrar scrutinizes the application for any deficiencies
(such as correctness of furnished details, or the prescribed fee) and communicates the
same to the applicant. The applicant has one month to correct the deficiencies. The
Registrar can also raise any objection to the application (such as an already existing
similar or identical trade mark), and the applicant has to respond within two months, or
request a hearing. The final decision will be given by the Registrar, and is appealable (the
applicant has a month to file an appeal).

B. Acceptance9: Once the preliminary examination is complete, and the applicant has
successfully corrected any deficiencies, and rebutted any objection to the application, the
Registar accepts the application for further processing. This acceptance may be whole, or
subject to certain conditions and amendments that the registrar may seek to impose in
order to eliminate or minimize any deception or misrepresentation in public interest. The
registrar may also refuse to accept the application, or withdraw acceptance after it has
been given, but before the GI has been registered. The reasons for refusal or conditional
acceptance must be recorded in writing by the Registrar, and in case of withdrawal of
acceptance, the applicant is entitled to a hearing.

8
​[Link]
9
Section 11(6), 11(7), and 12.
C. Advertisement: Once accepted, the application is advertised in the prescribed manner,
mainly through publication in the GI Journal. The advertisement has to take place within
three months from the date of acceptance.10

D. Opposition11: Any person can file an opposition to an application, stating the reasons why
the application should not be granted. The opponent has three months from the date of
advertisement to file the application, which can be extended by a month more upon prior
request (i.e. a request filed before the expiry of three months).12 Once an opposition is
received, the Registrar forwards the notice of opposition to the applicant, who has two
months from the date of this notice to file a counter statement. Failure to respond within
these two months leads to an automatic abandonment of the application

When the applicant files a counter statement, a copy of it is forwarded to the opponent,
and both the parties are thereafter given a duration of time within which they have to
submit their respective evidences, after which a hearing is fixed at which both parties
present their arguments regarding why an application should be granted or refused.

E. Registration: After hearing both the parties in case an opposition was filed and
challenged, or after the expiry of the time period in which an opposition could have been
filed in case no opposition was received, the Registrar makes the final decision regarding
the grant of the application. He may choose to refuse the application, grant it
conditionally, or grant it in ful. In the former two situations, the reasons for his decision
are recorded in writing. Upon grant of application, a certificate of registration is issued to
the applicant and the authorised users respectively.

10
​[Link]
11
Section 14
12
​[Link]
Duration and Renewal of Registration13
The duration of registration of a GI is 10 years, and it is renewable for every 10 years, upon the
submission of an application along with the prescribed fee for renewal of the registration to the
registrar.

The duration of the registration of the authorised user is ordinarily 10 years, but is subject to the
validity of the registration of the GI. If the registration of GI expires before the expiry of
registration of authorised user and is not renewed, the registration of authorised user would also
cease. Subject to the continued existence of the registered GI, the registration of authorised user
can also be renewed for a subsequent period of 10 years upon submission of an application and
the payment of renewal fee to the registrar. There is no limit to the number of times a renewal
may be made.

Before the expiry of the registration, the Registrar has to send a notice to the owner of GI or the
authorized user advising them of the imminent expiry, as well as informing them about the
formalities and the prescribed fee for renewal of the registration. A period of grace of six months
from the date of expiry of registration is allowed, within which, upon payment of a surcharge, an
application for renewal of registration may still be made and granted. If this period expires, the
Registrar removes the GI from the register.

After removal of the GI from the application because of non-payment of renewal fee, an
application for restoration of the registration can be made within one year from the date of expiry
of the last registration. If the registrar thinks that it is justified, he may choose to restore the
application. Even if no such application for restoration is made, the removed GI will still be
considered a valid GI for a period of one year from the date of its removal, for the purposes of
consideration of any other application for registration of another GI.14 This condition can be
waived only in case of the following situations:

13
Section 18.
14
Section 19.
● There has been no ​bona fide use in course of trade of the removed GI for a period of two
years before it was removed from the register; or,
● The use of the GI which is the subject matter of the new application will not lead to any
confusion or deception with the previous GI.

Conditions of Registration
Section 9 of the GI Act 1999 prescribes a list of characteristics that the GI must not possess for it
to be registrable under the Act. The section prohibits the registration of a GI which possesses any
of these characteristics. They are:

● Likely to deceive or cause confusion.


● Contrary to law.
● Are scandalous or obscene.
● Likely to hurt religious susceptibilities.
● Have become generic names of the goods in respect of which they are used, and have
ceased to be protected in their country of origin. For eg. Cheddar cheese no longer
indicates that the cheese was made in the Cheddar region of England. Rather it has
become a generic name for a type of cheese made in the style it was originally made in
Cheddar, England.
● Have fallen into disuse in the country of origin
● Are literally true to the origin, but falsely represent the goods to be originating in another
territory. For eg. consider hypothetically, that a seller sells Basmati rice grown in Punjab,
but fails to indicate whether it is the Pakistani Punjab, or the Indian one. The rice is
actually from the Indian Punjab. In such a case, a consumer might buy it thinking it is
from Pakistani Punjab, even though the seller made no indication as to a Pakistani origin.
While the indication he used is true to the origin, it falsely represents another origin of
the goods.

Difference between Trade Mark and Geographical Indications


Trade Mark Geographical Indications

It is a mark used in the course of trade to It is a mark used in course of trade to identify
identify a product or a service as being a product originating from a particular
produced by a particular individual or entity. location, where the quality, characteristics, or
reputation of the product is essentially
attributable to the geographical environment
of the place.

It is applicable in respect of both goods and It is applicable in respect of goods only.


services.

It is owned by an individual or a single legal It cannot be owned by an individual. It is


entity owned by an association of local producers, or
any other organization or authority desirous of
representing their interests.

A mark which serves to designate the place of origin of goods may be protected either as a trade
mark or as a GI. The regimes of Collective Mark, and Certification mark are ideal to enable an
association to register a GI as a trade mark and allow all people, entitled to be the authorised
user, the use of the mark either as a member of the association in case of a collective mark, or as
an authorised licensee in case of a certification mark. Both the Trade Marks Act 1999, and the GI
Act 1999, make accommodation however, to resolve any conflict between applicability of GI
and/or trade mark protection over subject matter, which may be eligible for both.

Section 9 of the Trade Marks Act declares any mark which serves to designate the place of origin
of the goods as devoid of distinctive character, and thus ineligible to be registered as a trade
mark. The exception is if the mark has acquired a distinctive character through long use and/or
extensive promotion and advertisement.
Section 25 of the GI Act prohibits the registration of a GI as a trade mark, empowering the
Registrar to refuse or invalidate the registration of any trade mark which consists of or contains a
GI, in respect of goods which do not originate in the designated territory of the GI. However, this
refusal/invalidation can only be made if the use of the trade mark would lead to a likelihood of
confusion or deception amongst the consumers regarding the true origin of the goods.

However, there are exceptions to this rule.

A trade mark shall not be refused registration, because it consists of, or contains a GI, if the
rights in it were acquired (through prior use) before the commencement of GI Act, or before an
application was filed for the registration of the GI under this Act.

Similarly, in case of an already registered trade mark which consists of or contains a GI, such
that it is identical or similar to a GI, the trade mark will not be invalidated if the rights in it were
acquired before the commencement of GI Act, or before an application was filed for the
registration of the GI under this Act.

A person also has the right to use his name as a trade name, or his business predecessor’s name
as a trade name, regardless of any similarity or identity with a GI, as long as there is no
likelihood of confusion or deception amongst the public, regarding the origin of the goods.

Rights Conferred by Registration


Upon registration of a GI, following rights are acquired by the applicant, as well as any
authorised user that may be registered in respect of the GI15:

● Right to sue for infringement of GI.


● Right to exclusive use of the GI.

The latter right is available only to the authorised user of the GI, and is subject to any condition
imposed by the registrar during the registration of GI. It is also subject to the exclusive use of the

15
Section 21.
GI by other authorised users. However, this right can be exercised by any or all authorised users
in respect of any unauthorised use by third parties.

Infringement of GI
A registered GI is infringed by the following acts16:

1. Unauthorised use in a manner which indicates that the goods in respect of which they are
used originate in the territory designated by the GI instead of the actual place of origin.
2. Use of another GI in a manner which is literally true to the origin of the goods in respect
of which it is used, but falsely represents to the consumers that the goods originate in
another territory which is designated by the registered GI (Consider the hypothetical
example of Punjabi Basmati rice).
3. The unauthorised use of a GI along with suffixes or prefixes such as ‘like’, ‘type’,
‘kind’, ‘imitation’, etc. or even with an indication of the true origin of goods, in respect of
goods which do not originate in the territory designated by the GI. This provision is
applicable only in respect of notified class of goods, such as wines and spirits.
4. Use in a manner which constitutes an act of unfair competition, such as:
a. Acts which constitute passing off in respect of the registered GI
b. Acts which cause confusion with the establishment, goods, or
industrial/commercial activities of a competitor.
c. False allegations in course of trade which serve to discredit the establishment,
goods, or industrial/commercial activities of a competitor.
d. Use of the GI in a manner which would mislead people about the nature,
manufacturing process, characteristics, quantity, or suitability to the purpose, of
the goods in respect of which the GI is used.

Exceptions:

16
Section 22.
● The doctrine of first sale is also applicable in case of GI. Any person who lawfully
acquires goods under a registered GI is entitled to the use of the GI in further sale of
those goods, either in processed form, or unprocessed.
● The use of an unregistered trade mark which has continued unhindered for five years
after it became known to the registered proprietor or authorised user of the GI, provided
that the mark was not used in bad faith.17
● The use of a registered trade mark which has continued unhindered for five years after it
was registered, or after it became known to the registered proprietor or authorised user
(whichever comes earlier) of the GI, provided that the mark was not used or registered in
bad faith.18

Case Studies

Scotch Whiskey Association v Golden Bottling Ltd. 19


Golden Bottling Ltd. (hereinafter, GBL), were selling whiskey under the mark ‘Red Scot’.
Scotch Whiskey Association (hereinafter, SWA) is a registered UK company formed to protect
and promote the interest of Scotch Whiskey trade in Britain and abroad. In 2000 it came to know
of GBL’s use of the mark ‘Red Scot’ in respect of the whiskey it sold in India, and sent several
cease and desist notices, requesting GBL to not use the word ‘Scot’ or ‘Scotch’ or any similar
sounding word as its trade mark, to which GBL did not respond. Thereafter, since ‘scotch’ or
‘Scot’ was not registered as a GI in India, they filed a suit for passing off of whiskey as Scotch
Whiskey in Delhi High Court.

The Court held that the use of the word ‘Scot’ in the trade used to sell whiskey gives the
impression that the whiskey is Scotch whiskey, i.e. originating in Scotland. Hence GBL’s use of
the word constitutes passing off of the whiskey as Scotch whiskey. The court thus passed an

17
Section 26(4).
18
Id.
19
​2006 (32) PTC 656 Del
injunction restraining GBL from using the word ‘Scot’ or any other similar word which might
indicate that the origins of the whiskey is Scotland when it is not, and awarded damages to SWA.

Khoday Distilleries v Scotch Whiskey Association20


Khoday distilleries (hereinafter, KD) were manufacturers of whiskey under the mark ‘Peter Scot’
along with the caption ‘Pride of India’ since 1968, which was subsequently registered as a trade
mark in 1971. In 1974, the SWA came to know of the mark and in 1986, they filed an application
for rectification of the mark.

SWA contended that the mark ‘Peter Scot’ gave the impression that the whiskey was
manufactured in Scotland and was Scotch whiskey when it was not, and the mark was therefore
deceptive, and should not have been registered. KD raised the defense of delay and
acquiescence, citing the 12 year difference between the time when SWA came to know of Peter
Scot, and the application for rectification.

The application was allowed on the grounds that while there was delay and acquiescence, the
allegation and evidence of deception was not rebutted. The High Court, on appeal, also ruled in
favour of SWA, holding that ‘The acquiescence if it is to be made a ground for declining to
rectify, must be of such a character as to establish gross-negligence on the part of the applicant or
deliberate inaction which had regulated in the appellant incurring substantial expenditure or
being misled into the belief that the respondents though entitled to, had deliberately refrained
from taking any action and were unmindful of the use of the mark by the person in whose name
it was registered. The facts of this case are not such as to warrant the conclusion that there has
been acquiescence.’21

The Division Bench of the HC also dismissed the appeal holding that the single judge bench had
considered all relevant factors before arriving at his conclusion. Therefore, KD filed an appeal in
the SC.

20
Supreme Court of India, Appeal (civil) 4179 of 2008.
21
​[Link]
KD contended that

1. The contention of the single judge bench that the long delay in filing the application has
not led to any prejudice on behalf of KD was incorrect. During the time period, KD had
increased its sale and market by manifolds. Such a long delay and acquiescence by SWA
in fact amounts to a waiver of their rights.
2. The use of the mark ‘Peter Scot’ in respect of whiskey does not amount to passing off for
the following reasons:
a. The purchasers of the whiskey are rich and discerning, and can be presumed to
know the particulars of the product that they are buying.
b. The label on the bottle also carries the slogan ‘Pride of India’ as well as
information about the manufacturing unit in Bangalore. The purchasers thus,
cannot be held to be deceived into thinking that they are buying Scotch Whiskey.

SWA on the other hand relied upon the findings of the lower courts, as well as upon the evidence
of deception amongst the consumers regarding origins of whiskey sold by KD, which had not
been rebutted by KD.

On the question of delay, the SC observed that during the 1970s, SWA had opposed the
registration of various marks which contained the words ‘scot’, ‘glen’, ‘highland chief’, and
‘Scotch terrier’ among others, but KD was left out. ​While it is true that delay is not an
absolute defense, and depends on factors such as cause of delay, injury to the respondent,
and bad faith of the respondent, in this case, SWA has not been able to give justifiable reasons
of the delay, nor have they been able to establish bad faith of KD. Their non action on other hand
has allowed KD to develop their trade, and an injunction at this stage would cause them
irreparable harm.

On the question of passing off, the SC held that the sophistication of the consumers, and their
education level forms a valid factor in determining if there is misrepresentation leading to
deception amongst the consumers. The courts stated that, ‘​Where the class of buyers, as noticed
hereinbefore, is quite educated and rich, the test to be applied is different from the one where the
product would be purchased by the villagers, illiterate and poor… ...we are concerned with the
class of buyer who supposed to know the value of money, the quality and content of Scotch
Whisky. They are supposed to be aware of the difference of the process of manufacture, the
place of manufacture and their origin.’

The appeal was therefore allowed, and the previous decisions were reversed.

Tea Board of India v ITC Ltd.22


The Tea Board of India (hereinafter, TBI) is a statutory body incorporated in 1953 with the
responsibility of protecting and promoting the trade of tea in India and abroad. Amongst various
teas, it also administered Darjeeling tea, whose unique taste could be attributed to the climate
and terrain of Darjeeling. TBI is the owner of the certification mark and logo of ‘Darjeeling Tea’.
Upon the commencement of the GI Act, the ‘Darjeeling Tea’ was the first GI to be registered.

ITC is the owner of a chain of hotels, one of which was ITC Sonar Hotel in Kolkata. It had a
lounge which was named as ‘Darjeeling Lounge’, wherein among other beverages, tea was also
served. ITC had also applied for the registration of the mark ‘Darjeeling’ as a service mark in
respect of restaurant and hospitality services.

TBI opposed the registration and claimed that this use amounts to infringement of its registered
certification mark and GI, as well as passing off of its mark and logo of ‘Darjeeling Tea’. The
case eventually reached the HC on appeal.

The Court held that the use of the word Darjeeling in respect of a lounge does not lead to
deception or a likelihood of confusion amongst the consumers, and the use is in respect of
services which have very little nexus with the product in respect of which the certification mark
and GI is registered. Because of absence of likelihood of confusion or deception, an action of
passing off also cannot be sustained.

‘The word "Darjeeling" - as precious to tea as it may be as champagne to sparkling wines of that
province in France - cannot be exclusively claimed by the plaintiff by virtue of its registration as
a geographical indication or as a certification trade mark. Even for a case of passing-off, the use

22
Calcutta HC. ​CS No. 250 of 2010
of "Darjeeling" by a person other than the plaintiff can be complained of if the word or the
geographical indication has any nexus with the product with which it is exclusively associated
upon the registration.’

The appeal was dismissed.

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