Trade Mark Cancellation Risks from Non-Use in India: Proof of Use, Licensing and the Limits of Token Use

Introduction : A trade mark certificate can be easily framed and put up on the office wall. Defending it, on the other hand, is a more involved process. Section 28 of the Trademarks Act, 1999 grants the registered proprietor with an exclusive right to use the mark for the goods/service covered by the registration, but the same statute puts a rider on that right. Marks left idle for too long can be removed at the instance of any person aggrieved.

Since 2021, when the Intellectual Property Appellate Board was abolished and the rectification work passed to the High Courts, petitions of non-use have often come in as a counter. A trader finds its application blocked by an earlier registration and checks whether the cited mark had ever been sold, and often finds no trace of it in the market. The owner pulls out whatever is in the filing cabinet: a few old invoices, a brochure, a screenshot. That material can fail because it is outside the period the statute looks at or shows such thin use that it is an act in the name of keeping a registration alive. This blog discusses the statutory scheme, the evidentiary standard Indian courts apply and the position of licensees and affiliates and ends with a recordkeeping checklist for businesses.

Legal Provisions

Section 47 of the Trade Marks Act, 1999

Section 47(1) provides two grounds for removal, (a) where the mark was registered without bona fide intention to use and there has been no bona fide use of the mark up to three months before the application. (b) the main ground on which petitions are filed; where, up to three months before the application, a period of five or more consecutive years has elapsed since the mark has actually been entered in the register without bona fide use by any proprietor for the time being. A proviso permits the Registrar or the High Court to refuse removal if the sign has been used in good faith for goods or services of the same description, or for associated goods or services. Section 47(3) provides protection where the non-use flows from special circumstances in the trade, including restrictions imposed by any law or regulation in India; but the protection is lost where the non-use reflects an intention to abandon the mark.

Section 57 and the Statutory Meaning of Use

Section 57 allows any person aggrieved to apply for rectification of an entry wrongly remaining on the register and petitions commonly invoke both provisions. In relation to goods, use under s. 2(2)(b) includes use of the mark upon the goods or in any physical or other relation to them, and s. 48(2) deems 'permitted use' of the mark to be used by the proprietor for the purposes of s. 47, and s. 2(1)(r) extends permitted use to an unregistered licensee who has the proprietor's consent in a written agreement.

Legal Analysis

What Counts as Bona Fide Use

Indian law is generously worded in relation to 'use'. In Hardie Trading the Supreme Court refused to restrict 'use' to physical sales, and allowed that advertisements, invoices and orders could each be deemed use in respect of goods. This liberality has a limit, for the use must also be bona fide. The Court of Justice of the European Union expressed the requirement in terms of Ansul: genuine use is real commercial exploitation aimed at creating or maintaining an outlet for the goods, with use serving merely to preserve the rights conferred by registration being merely token. The English Court of Appeal had previously refused to regard a small, engineered launch of NERIT cigarettes as bona fide use, on the basis that the registration served predominantly to fence off the descriptive word MERIT. A single consignment shipped weeks before a dispute, or a sale to a related party at a nominal price, will be read against the rest of the record. With no stock, distribution or advertising behind it, such a transaction looks engineered for the file.

Burden of Proof and the Evidentiary Window

The onus lies initially with the applicant to prove non-use, typically by the submission of investigators' reports and market surveys, after which the proprietor is obliged to respond by way of document production. The failure to do so can prove extremely expensive. In Russell Corp, the Delhi High Court took action upon an unrebutted investigator's affidavit indicating that SHERRIN had been discontinued since 2010. In January 2026, the same Court admitted a plea of non-use against the BANDOOK mark which had not been answered.

Timing is a frequent pitfall for proprietors. For a petition filed on 1 October 2026, the question arises whether there has been bona fide use between 1 July 2021 and 1 July 2026.

An invoice dated in 2019 can say little for such a period, however genuinely it may be dated, and a hurried launch in the final three months lies outside it altogether. Consider the proprietor in Rong Thai, whose invoices stretch from 2012 to 2022 and who was able to retain the BAOJI registration.

The Abandonment Question

The case law on the point is far from conclusive. Hardie Trading interpreted an intention to abandon into the non-use inquiry under the 1958 Act, and Rong Thai accepted that the applicant should provide evidence on abandonment, but Kabushiki Kaisha Toshiba drew attention to the other alternative that the two provisions have different scope, and that the subsequent case law provides grounds for distinguishing between them. Toshiba cited earlier authorities, according to which, when interpreting clause (b), the court must consider that the intention of the owner to use the trademark has ceased to have relevance at the moment when the period of non-use expires. The text of the 1999 Act seems to confirm the interpretation advanced by Toshiba, since in Section 47(3) a mention of intention to abandon appears only in connection with the withdrawal of protection in the case of special circumstances on the part of the applicant. Until the Supreme Court clarifies the issue, trademark owners should consider proof of intention as an additional criterion to demonstrate the absence of abandonment.

Licensing and Use by Affiliates

Many Indian groups carry marks in a parent or holding company by way of subsidiaries which manufacture and market the goods. Section 48(2) protects such a structure if the subsidiary's use falls within the category of permitted use requiring a written agreement and a nexus during the course of trade. Hardie Trading credited the use of a registered user to the proprietor, and Gujarat Bottling accepted licensing which causes no confusion, preserves distinctiveness and maintains a trade connection with the proprietor, which in practice speaks of quality control. An oral understanding between sister concerns, or invoices raised by a distributor who signed nothing, leaves the proprietor to ask a court to credit the sales of another person to it.

Partial Use Across Product Lines

The use of a trademark on one product protects that product and its coverage over the rest of the specification is limited. In Vishnudas Trading, the Supreme Court narrowed down the registration of the CHARMINAR for ‘manufactured tobacco’ to cigarettes, the only article the proprietor made, reasoning that a trader dealing in some articles within a broad class should not monopolize all of them. A company that has registered a mark for an entire class and launched one product line is exposed for everything else.

Relevant Case Laws

Hardie Trading Ltd v Addisons Paint and Chemicals Ltd., (2003) 11 SCC 92: Addisons, former registered user of Hardie's, ceased using the SPARTAN marks in 1971 and applied to remove them in 1977. The Supreme Court restored the registrations, finding that use of the mark extends to advertisements, invoices and orders, that the use by a registered user is that of the proprietor, and that the import restrictions on paints were special circumstances.

Kabushiki Kaisha Toshiba v Toshiba Appliances Co., (2008) 10 SCC 766: TOSHIBA was challenged in class 7 for washing machines and spin dryers, with the only evidence being an advertisement from 1985, which the single judge found not to be used of the mark. The Supreme Court agreed to hear Toshiba's appeal on the limited issue of whether the lower courts erred in finding that the applicant would not be damaged by the entry.

Vishnudas Trading v Vazir Sultan Tobacco Co Ltd., (1997) 4 SCC 201: The owner of CHARMINAR had applied for registration of manufactured tobacco but produced only cigarettes, whereas, the appellant has been using CHARMINAR for quiwam and zarda since 1973. The Court upheld the order which restricted registration to cigarettes.

Infosys Technologies Ltd v Jupiter Infosys  Ltd., (2011) 1 SCC 125: Despite the removal of three INFOSYS registrations by the IPAB, the Supreme Court ruled that the applicant's grievance must have existed at the time of filing, persisted until the decision was reached, and was subject to examination for each registration.

Practical Implications

The risk rarely shows itself at registration. It appears after several years, when a competitor or a foreign company launching in India turns up with a request to clear the register and the owner has to present evidence within a limited time frame. Records routinely kept by sales executives are often incomplete or incorrectly dated or bear the wrong entity's name.

Recordkeeping Checklist

• Map registrations to live products.

• Keep dated sales evidence for every year.

• Pair invoices with images.

• Preserve advertising records.

• Paper every license.

• Align regulatory approvals.

• Record reasons for any pause.

• Audit annually.

Conclusion

A registration in India is based on use, which must be evidenced by documents corresponding to the statutory time frame. The interpretation of 'use' advanced in Hardie Trading is advantageous to owners, but the High Courts increasingly decide petitions on the papers and an unexplained investigator's report can defeat a registration. Token sales and stale invoices are poor protection against such a finding and the granting of intra-group licenses exposes to litigation where the agreement required by Section 48(2) is lacking.

Two reforms to the law would be of benefit. The first would be a definitive pronouncement on whether the intention to abandon is a relevant factor in applying Section 47(1)(b) and the second is the requirement for a periodic declaration of use similar to the United States Lanham Act, which would give the register a more accurate reflection of marks in use. Until then, the most prudent course for a brand owner is the meticulous recordation of use built up from years and products in a measured way.

Author: Priyanshu Kandpal in case of any queries please contact/write back to us via email to content@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney