Delhi High Court Directs Toplad To Change Name, Finds 'TOPLAD' Too Nearly Resembles 'TOPLAND'

The Delhi High court has directed Toplad Private Limited to change its name, holding that “TOPLAD” too nearly resembles the registered “TOPLAND” trademark of Topland Engines Private Limited.

“Except for the letter 'N', both the words completely resemble each other and to the mind of a person with average intelligence, the mere negation of the letter 'N' would not make the names visually or phonetically dissimilar,” Justice Amit Mahajan observed.

The court set aside the May 15, 2023 order of the Regional Director, Ministry of Corporate Affairs, which had rejected the application filed by Topland Engines under Section 16 of the Companies Act, 2013.

Topland Engines was incorporated in April 2021 and manufactures and provides services relating to diesel engines, generators and their parts. Toplad, incorporated in June 2020, provides online and offline education in various disciplines, including Company Secretary, Chartered Accountancy and Cost Management Accountancy.

Topland Engines registered the “TOPLAND” trademark in 2008. The judgment records that, considering future projects and diversification, the petitioner got the trademark registered in all classes, including Class 41, which includes education.

The company approached the Regional Director under Section 16 seeking rectification of Toplad's name. The provision allows a registered trademark proprietor to seek a change where a company's name is identical with or too nearly resembles its registered trademark.

The application was rejected after the Regional Director split the names into parts. The authority found that “LAND” and “LAD” had distinct meanings and that no exclusivity could be claimed over the common word “TOP”.

Counsel for the Regional Director defended the order, arguing that the names were distinct when considered as a whole. The two companies also operated in completely different businesses and had different trade channels and target consumers, the counsel submitted.

Justice Mahajan rejected that approach.

“The path adopted by Respondent No.2 in segregating 'TOPLAND' and 'TOPLAD' into two words is erroneous,” the court ruled.

The court held that the name had to be examined as a whole. On that comparison, it found the two expressions structurally and phonetically similar. Apart from the missing “N”, they completely resembled each other, the court observed.

The missing letter could also be slurred over while pronouncing the name, the court observed. Simply removing one letter, therefore, did not make the expression sufficiently distinct.

Section 16(1)(b) allows a registered trademark proprietor to seek correction of a company name that is identical with or too nearly resembles its registered trademark. The application has to be made within three years of the company's incorporation, registration or change of name.

The court observed that the power under Section 16 is wider and stricter than the standard applied in a trademark dispute. The Regional Director does not have to determine whether consumers are likely to be deceived or confused.

Instead, the question is whether the company name is identical with or too nearly resembles the registered trademark.

“The power stipulated in the said provision is wider and stricter than the standard contemplated in trademark dispute,” the court observed.

The court also noted that how competing names are ordinarily pronounced, written or represented in Indian languages can be relevant in assessing resemblance.

It ultimately held that “TOPLAD” too nearly resembles “TOPLAND”. The Regional Director's order was set aside, and Toplad was directed to change its name to one that does not resemble the registered trademark.

The Regional Director, Ministry of Corporate Affairs, was directed to take the steps required under law within four weeks.