Name Clashes: Resolving Conflicts between Corporate Identities and Trade Marks

When it comes to Section 16, Companies Act, what really matters is whether two names look or sound too much alike — not who owns what.

Introduction

The dispute arises when an existing company or trade mark proprietor finds that a company recently incorporated has a similar or identical name and is likely to deceive the public and dilute its goodwill. Traditionally, disputes related to corporate names were governed by the Companies Act, 1956 (1956 Act), with an express intent to maintain the integrity of the company register. However, the Companies Act, 2013 (2013 Act), has broadened its scope of protection by recognising trade mark proprietors expressly in corporate name disputes.

This evolution is more than legislative reform; it is a conceptual shift in Indian corporate jurisprudence from protection of mere administrative accuracy to protection of commercial identity and intellectual property. The blog proceeds to trace this development chronologically, explaining the transition from Section 22 of the 1956 Act to Section 16 of the 2013 Act, power of court, limited interference of tribunal, jurisdiction, limitation followed by an analysis of how courts have interpreted, and applied these provisions through landmark judgments.

Legislative framework: Section 22 of the 1956 Act and Section 16 of the 2013 Act

Back when the Companies Act, 1956 was in force, Section 22 let the Central Government step in and order a company to change its name if it matched or looked too much like the name of another registered company, or a registered trade mark. But the Government only had 12 months from the date the company was incorporated or changed its name to act. If the company ignored the order, it had to pay a daily penalty.

Then the Companies Act, 2013¹ came along and switched things up. Section 16 replaced the old rule. Now, under Section 16(1)(a), the Government still has the power to force a name change if a company registered a name that is too close to an existing one. This section does not set a time-limit. Without that deadline, people started arguing — can someone really complain about a company’s name long after it is been around, just because there is no set window for objections?

Section 16(1)(b) handles things differently for trade mark owners. If a company’s name is identical or too similar to a registered trade mark, the trade mark owner can ask for a name change — but only within three years of the company’s incorporation or name change. Trade mark owners have a strict deadline, but when it comes to the Government acting on its own under clause (a), the expectation is that it will still act reasonably, even without a fixed time-limit.

Who may apply — when and why

There is another interpretation about whether private parties can file Section 16(1)(a). The Madras High Court in T.T. Ltd. v. Union of India², settled this stating that clause (a) is just for the Central Government. Trade mark owners or anyone else cannot rely on it — they have to file Section 16(1)(b) instead, which lays out a specific process and a set deadline. Courts have also made clear that if a law does not spell out a deadline, the authority in charge cannot just wait forever. They need to act within a reasonable time. The Supreme Court said as much in cases like Mohamad Kavi Mohamad Amin v. Fatmabai Ibrahim³ and Union of India v. Citi Bank N.A.⁴ that If someone sits on their rights for too long, the law loses its certainty and fairness. So, even the Central Government cannot dig up old cases under Section 16(1)(a) years — maybe decades — after a company has already been set up. The reasonable time-frame must be interpreted in harmony with the older provision under Section 22, which allowed only twelve months for such action.

How to decide the jurisdiction of regional director

The location of the company’s registered office determines the jurisdiction of the Regional Director (RD) of the Ministry of Corporate Affairs under both the current Section 16, Companies Act, 2013 and the previous Section 22 of the repealed Companies Act, 1956. Name rectification and related proceedings will be decided by the RD who has jurisdiction over the geographic area where the company’s Registrar of Companies (ROC) is located.

For a company registered in Uttarakhand, the ROC concerned⁵ is ROC — Uttarakhand (Dehradun), which falls under the jurisdiction of the Northern Regional Director, New Delhi; whereas a company registered in Jaipur, Rajasthan comes under ROC — Rajasthan (Jaipur), which is governed by the North Western Regional Director, Ahmedabad, and accordingly any proceedings under Section 16, Companies Act, 2013 must be filed before the respective RD based on the location of the company’s registered office against which applicant wants to file rectification application.

Judicial development and chronological case law analysis

Courts have played a big part in shaping how Sections 22 and 16 work. If you look at the big cases over the years, you see a steady evolution — getting clearer about what counts as resemblance, who has the power to act, how long someone can wait to file, and where the RD’s authority stops.

1. Company name scrutiny prevails over trade mark findings

In CGMP Pharmaplan (P) Ltd. v. Union of India⁶, the petitioner tried to keep “Pharmaplan” in its company name, arguing that a civil court had already found no deceptive similarity with another trade mark. However, the High Court dismissed that assertion stating that said company law uses stricter tests than trade mark law. Even if there is just a close resemblance — no actual confusion needed — the name can be changed. The Court made it clear that the RD can decide on resemblance independently, and company law works on its own track, separate from intellectual property law, even though they sometimes overlap.

2. The Madras High Court in Shaktiman Equipments v. Union of India⁷, the Court looked at the rights of prior users and the weight of goodwill. Here, the company “Shaktiman Equipments” popped up in 2019, while Tirth Agro had already been using “Shaktiman” as a trade mark for over sixty years. The RD ordered rectification because the names were identical, and the court backed that up. The reasoning was blunt: If the names are identical, confusion is likely, even if the businesses are not in the same field. Prior users get stronger protection, and even if the new company did not mean to copy, the name still has to go. The main takeaway? It is all about the likelihood of association in the public’s mind — not whether the businesses overlap.

3. Courts protect well-known corporate prefixes from misuse that may mislead an ordinary person.

Similarly, the issue raised before the Telangana High court in GMR Spintex v. Regional Director⁸ whether a textile company could use the “GMR” prefix. The established “GMR Group” objected, and the RD told the petitioner to drop “GMR” from its name. The High Court agreed. They said you do not need identical businesses for there to be a problem famous corporate prefix that can mislead people into thinking there is a connection. The test? What would an ordinary person with an imperfect memory think? The Court also made it clear that timing matters, but trade mark rectification follows the idea of “reasonable time”, not a hard deadline. It is all about protecting big, recognisable names from getting watered down or misused.

4. Determination on the applicability and limitation of Section 16(1)(a)

That Madras High court in T.T. Ltd. case⁹ made it clear that private parties cannot file applications under Section 16(1)(a), Companies Act, 2013. That power belongs only to the Central Government. A registered trade mark owner can file application under Section 16(1)(b) within three years from when the company was incorporated or changed its name. Now, even though Section 16(1)(a) does not spell out a time-limit, the Court said the Government still needs to act within a reasonable time — pretty much like the old twelve-month window under Section 22 of the 1956 Act. In this case, the companies had been around for years, so these petitions were just too late. The Government was right to reject them. The Court also threw out the writ petitions, not just because of the delay, but also because the petitioner had already tried and failed to get relief in a trade mark suit.

5. Trade mark ownership disputes lie outside Section 16 proceedings

The most recent case of the Delhi High Court in Panchhi Petha Store v. Union of India¹⁰, really spelled out what the RD can and cannot do. Two parties fought over the famous “Panchhi Petha” name from Agra. The RD tried to figure out who owned the trade mark, siding with one party. The High Court was not having it — they said the RD went too far. His job is only to decide if names are too similar, not who really owns the mark or whether there is infringement. Ownership disputes belong in Intellectual Property (IP) Tribunals or civil courts. The High Court also said its own role under Article 226 is just to check if the RD followed the law and was fair — not to second-guess the resemblance decision. This case drew a clear line around the RD’s authority in company name rectification.

Conclusion

When it comes to Section 16, what really matters is whether two names look or sound too much alike — not who owns what. The Registrar of Companies can only check for that resemblance, nothing more. Also, trade mark owners now get legal recognition, but they have to move fast — they get three years to raise objections under Section 16(1)(b). Even though the law does not always spell out deadlines, there is something called “reasonable time”, and it keeps the authorities from dragging their feet. When disputes land in court, High Courts do not act as appeal courts — they just make sure everything stays on track.