Court holds that only registered trade mark proprietor can file application under Companies Act, 2013 Section 16(1)(b); company itself, even if directed by proprietor, cannot maintain such applications
In a significant judgment dated September 9, 2026, the Kerala High Court, through Justice Bechu Kurian Thomas, has quashed orders that directed two Ayurveda companies registered under the names "M/s. Kandamkulathi Ayurveda Vaidyasala (P) Ltd." and "Kandamkulathi Francis Vaidyan's Ayurveda Vaidyasala (P) Ltd." to change their names. The orders had been issued under Section 16 of the Companies Act, 2013, following applications filed by another company alleging name resemblance.
The dispute arose because a third company, M/s. K. P. Pathrose Vaidyan's Kandamkulathy Vaidyasala Pvt. Ltd., which had been in existence since 1995, filed applications under Section 16(1)(b) of the Companies Act, 2013, seeking rectification of the names of the two newer companies registered in 2016 and 2017 respectively. The contention was that the names of the two companies were identical or too closely resembled the existing company's registered trade mark "Kandamkulathy."
However, the High Court emphasized that applications under Section 16(1)(b) of the Companies Act, which deals with rectification of company names on grounds of resemblance to registered trade marks, can only be filed by the registered proprietor of the trade mark. In this case, the registered proprietor of the trade mark "Kandamkulathy" was Dr. Rosemary Wilson, not the company that filed the applications for rectification.
The Court ruled that a company is a distinct legal entity, separate from its directors or shareholders. Even though Dr. Rosemary Wilson was a director in the applicant company, that did not confer the right on the company itself to file the application. The Court held that the applications were not maintainable as per the statutory language of Section 16(1)(b), which explicitly requires the applicant to be the registered trade mark proprietor.
Further, the Court noted that the Central Government has the authority under Section 16(1)(a) to initiate suo moto proceedings against companies if their names are identical or closely resemble existing company names. However, no such proceedings had been initiated in this case.
The Court also rejected the argument for exclusion of time spent in pursuing writ petitions under Section 14 of the Limitation Act, 1963, to allow the registered proprietor to file a fresh application, holding that such exclusion was not permissible since no proceedings had been initiated by the registered proprietor.
Ultimately, the Kerala High Court set aside the impugned orders directing the name change and allowed the writ petitions filed by the two companies. The Court clarified that only Dr. Rosemary Wilson, as the registered proprietor of the trade mark, could have filed an application for rectification under the Companies Act. The judgment reinforces the principle of separate legal personality of companies and strict adherence to statutory provisions regarding trade mark rights and company name rectification.
Bottom Line:
An application for rectification of a company's name under Section 16(1)(b) of the Companies Act, 2013, can only be made by the registered proprietor of the trade mark. A company, even if its director is the registered proprietor, cannot maintain such an application as it is a separate legal entity.
Statutory provision(s): Companies Act, 2013 Section 16(1)(a), Section 16(1)(b), Limitation Act, 1963 Section 14
