Section 27 of the Trademark Act, 1999 reads as follows:
“27. No action for infringement of unregistered trade mark.—(1) No person shall be entitled to institute any proceeding to prevent, or to recover damages for, the infringement of an unregistered trade mark.
(2) Nothing in this Act shall be deemed to affect rights of action against any person for passing off goods or services as the goods of another person or as services provided by another person, or the remedies in respect thereof.”
The above-mentioned section simply state that there shall lie no infringement action with respect to an unregistered trademark, at the same time it also states that the common law right of the trademark owner to take action against any person for passing off their goods/services as the goods of another person or as services provided by another person.
The hon’ble Supreme Court in Dhariwal Industries Ltd. & And. Vs. M.S.S. Food Products, has stated that Section 27 of the Trademarks Act, 1999 provides that nothing in that act shall be deemed to affect the right of action against any person or the remedies in respect thereof. Therefore, the fact that neither party has a registered trade mark as on the date of the suit cannot stand in the way of entertaining the claim of the plaintiff and granting the plaintiff an injunction in case the plaintiff is in a position to show prima facie that it was the prior user of its mark, that it had a prima facie case and that the balance of convenience was in favour of the grant of an interim injunction.
It is clear that the a owner of an unregistered trademark cannot initiate a proceeding to prevent or recover damages for infringement but can initiate a proceeding for passing off on proving that he is the prior user of the mark. Thus every owner of a mark must get it registered as per the rules, regulations and on payment of requisite fees to the trademark authority. An owner of unregistered trademark cannont claim damages for infringement but can only initiate a proceeding for passig off.
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