The Act can be divided into the following category:

1. General Principles of Contracts

2. Specific kinds of Contracts

General Principles of Contract

1st September 1872

Basic Concepts

What is a contract? 

A contract is an agreement that can be enforceable by law.   An agreement is  an offer and its acceptance.  An
agreement which can be enforceable by law must have some essential elements. According to Section 10 "All
agreements are contracts if they are made by the free consent of the parties competent to contract, for a
lawful consideration and with a lawful object, and are not hereby expressly declared to be void" As per the
above section, a contract must have the following elements.

1.  Intention to create legal relationship.

2.  Lawful object

3.  *Agreement not expressly declared void

4.  *Proper offer and it s acceptance

5.  *Free Consent

6.  Capacity of parties to contract

7.  *Certainty of meaning.

8.  Possibility of performance.

9.  *Lawful consideration

10.  Legal formalities

Intention to create legal relationship: The parties entering into a contract must have an intention to create a
legal relationship. If  there is no intention to create a legal relationship, that agreement cannot be treated as a
valid contract. Generally there is no intention to create a legal relationship in social and domestic agreements.
Invitation for lunch does not create a legal relationship. Certain agreements and obligation between father and
daughter, mother and son and husband and wife does not create a legal relationship. An agreement wherein it
is clearly mentioned that "This agreement is not intended to create formal or legal agreement and shall not be
subject to legal jurisdiction in the law of courts." cannot be treated as a contract and not valid.  

Lawful Object: The objective of the agreement must be lawful. Any act prohibited by law will not be valid and
such agreements cannot be treated as a valid contract. A rents out his house for the business of prostitution or
for making bomb, the acts performing there are unlawful. Hence such agreement cannot be treated as a valid
contract. Therefore the consideration as well as the object of the agreement should be lawful.

*Agreement not expressly declared void: Section 24 to 30 specify certain types of agreement which have been
expressly declared void. For example Restraint of marriage which has been expressly declared void under
Section 26. If John promises to pay $50 to Mary if she does not marry throughout her life and Mary promise
not to marry at all. But this agreement cannot be treated as a valid contract owing to the fact that, under
section 26 restraint of marriage expressly declared void. Some of the agreement which have been expressly
declared void are agreement in restraint of legal proceedings, agreement in restraint of trade, agreement in
restraint of marriage and agreement by way of wager.

*Proper offer and it s acceptance: To create a valid contract, there must be two or more parties. One who
makes the offer and the other who accepts the offer. One person cannot make an offer and accept it. There
must be at least two persons. Also the offer must be clear and properly communicated to the other party.
Similarly acceptance must be communicated to the other party and the proper and unconditional acceptance
must be communicated to the offerer. Proper offer and proper acceptance should be there to treat the
agreement as a contract which is enforceable by law.

*Free Consent: According to section 14, consent is said to be free when it is not caused by (i) coercion/force, (ii)
undue influence (iii) fraud, (iv) misrepresentation, or (v) mistake. If the contract made by any of the above four
reason, at the option of the aggrieved party it could be treated as a void contract. If the agreement induced by
mutual mistake the agreement would stand void or canceled. An agreement can be treated as a valid contract
when the consent of the parties are free and not under any undue influence, fear or pressure etc. The consent
of the parties must be genuine and free consent.

Capacity of parties to contract: Parties entering into an agreement must be competent and capable of entering
into a contract. If "A" agrees to sell a Government property to B and B agrees to buy that property, it could not
treated as a valid agreement as A is not authorized or owner of the property. If any of the party is not
competent or capable of entering into the agreement, that agreement cannot be treated as a valid contract.
According to Section 11 of the Act which says that every person is competent to contract who is of the age of
majority according to the law to which he is subject and who is of sound mind, and is not disqualified from
contracting by any law to which he is subject.  So it is clear that the party must be of sound mind and of age to
enter into a valid agreement which can be treated as a valid contract.

*Certainty of meaning: Wording of the agreement must be clear and not uncertain or vague. Suppose John
agrees to sell 500 tonnes of oil to Mathew. But, what kind of oil is not mentioned clearly. So on the ground of
uncertainty, this agreement stands void. If the meaning of the agreement can be made certain by the
circumstances, it could be treated as a valid contract. For example, if John and Mathew are sole trader of
coconut oil, the meaning of the agreement can be made certain by the circumstance and in that case, the
agreement can be treated as a valid contract. According to Section 29 of the Contract Act says
that Agreements, the meaning of which is not certain or capable of being made certain, are void.

Possibility of performance: As per section 56, if the act is impossible of performance, physically or legally, the
agreement cannot be enforced by law. There must be possibility of performance of the agreement. Impossible
agreements like one claims to run at a speed of 1000km/hour or Jump to a height of 100feet etc. would not
create a valid agreement. All such acts which are impossible of performance would not create a valid contract
and cannot treated as a valid contract. In essence, there must be possibility of performance must be there to
create a valid contract.

*Lawful consideration: An agreement must be supported by a consideration of something in return. That is,
the agreement must be supported by some type of service or goods in return of money or goods. However, it
is not necessary the price should be always in terms of money. It could be a service or another goods. Suppose
X agrees to buy books from Y for $50. Here the consideration of X is books and the consideration of Y is $50. It
can be a promise to act (doing something) or forbearance (not doing something). The consideration may be
present, future or can be past. But the consideration must be real. For example If John agrees to sell his car of
$ 50000 to Peter for $20000. This is a valid contract if John agrees to sell his car not under any influence or
force. It can be valid only if the consideration of John is free. An agreement is valid only when the acts are
legal. Illegal works like killing another for money, or immoral works or illegal acts are cannot be treated as a
valid agreement. So, illegal works will not come under the contract act.

Legal formalities: The contract act does not insist that the agreement must be in writing, it could be oral. But,
in some cases the law strictly insist that the agreement must be in writing like agreement to sell immovable
property must be in writing and should be registered under the Transfer of Property Act, 1882. These
agreement are valid only when they fulfill the formalities like writing, registration, signing by the both the
parties are completed. If these legal formalities are not completed, it cannot be treated as a valid contract.

Most important essentials of a valid contract are mentioned above. These elements should be present in a
contract to make it a valid contract. If any one of them is missing we cannot treat that agreement as a valid
contract.

*An agreement must not be expressly declared to be void :

A void agreement is not enforceable by law (Sec 2(g)). It has no legal sanctity. It  
does not give rise to any rights and obligations. Various agreements are expressly 
declared void under the Act. 

Discuss the warranties and conditions under the sale of goods act.

Conditions and Warranties - Opening para of section 16 makes it clear that there is no implied warranty or
condition as to quality of fitness of goods for any particular purpose, except those specified in Sale of Goods
Act or any other law. - - This is the basic principle of caveat emptor’ i.e. buyer be aware.

However, there are certain stipulations which are essential for main purpose of the contract of sale of goods.
These go the root of contract and non-fulfilment will mean loss of foundation of contract. These are termed as
‘conditions’. Other stipulations, which are not essential are termed as ‘warranty’. These are collateral to
contract of sale of goods. Contract cannot be avoided for breach of warranty, but aggrieved party can claim
damages. - - A breach of condition can be treated as breach of warranty, but vice versa is not permissible.

A stipulation in a contract of sale with reference to goods which are the subject thereof may be a condition or
a warranty. [section 12(1)]. A condition is a stipulation essential to the main purpose of the contract, the
breach of which gives rise to a right to treat the contract as repudiated. [section 12(2)]. A warranty is a
stipulation collateral to the main purpose of the contract, the breach of which gives rise to a claim for damages
but not to a right to reject the goods and treat the contract as repudiated. [section 12(3)]. Whether a
stipulation in a contract of sale is a condition or a warranty depends in each case on the construction of the
contract. A stipulation may be a condition, though called a warranty in the contract. [section 12(4)].

Where a particular stipulation in contract is a condition or warranty depends on the interpretation of terms of
contract. Mere stating ‘Conditions of Contract’ in agreement does not mean all stipulations mentioned are
‘conditions’ within meaning of section 12(2).

When condition to be treated as warranty - Where a contract of sale is subject to any condition to be fulfilled
by the seller, the buyer may waive the condition or elect to treat the breach of the condition as a breach of
warranty and not as a ground for treating the contract as repudiated. [section 13(1)]. Where a contract of sale
is not severable and the buyer has accepted the goods or part thereof, the breach of any condition to be
fulfilled by the seller can only be treated as a breach of warranty and not as a ground for rejecting the goods
and treating the contract as repudiated, unless there is a term of the con tract, express or implied, to that
effect. [section 13(2)]. Nothing in this section shall affect the case of any condition or warranty fulfillment of
which is excused by law by reason of impossibility or otherwise. [section 13(3)].

Time of payment is not essence of contract but time of delivery of goods is, unless specified otherwise - Unless
a different intention appears from the terms of the contract, stipulations as to time of payment are not
deemed to be of the essence of a contract of sale. Whether any other stipulation as to time is of the essence of
the contract or not depends on the terms of the contract. [section 11]. As a general rule, time of payment is
not essence of contract, unless there is specific different provision in Contract. In other words, time of
payment specified is ‘warranty’. If payment is not made in time, the seller can claim damages but cannot
repudiate the contract.

Caveat Emptor - The principle termed as ‘caveat emptor’ means ‘buyer be aware’. Generally, buyer is expected
to be careful while purchasing the goods and seller is not liable for any defects in goods sold by him. This
principle in basic form is embodied in section 16 that subject to provisions of Sale of Goods Act and any other
law, there is no implied condition or warranty  as to quality or fitness of goods for any particular purpose. As
per section 2(12), “Quality of goods” includes their state or condition.

Rights of Unpaid seller

"Unpaid seller" defined. –

(1) The seller of goods is deemed to be an "unpaid seller" within the meaning of this Act-
(a) When the whole of the price has not been paid or tendered.
(b) When a bill of exchange or other negotiable instrument has been received as conditional payment,
and the conditions on which it was received has not been fulfilled by reason of the dishonour of the
instrument or otherwise.
(2) In this Chapter, the term "seller" includes any person who is in the position of a seller, as, for instance, an
agent of the seller to whom the bill of lading has been endorsed, or a consignor or agent who has himself paid,
or is directly responsible for, the price.

Unpaid seller’s rights. –

(1) Subject to the provisions of this Act and of any law for the for the time being in force, notwithstanding that
the property in the goods may have passed to the buyer, the unpaid seller of goods, as such, has by implication
of law.
(a) a lien on the goods for the period while he is in possession of them,
(b) in case of the insolvency of the buyer a right of stopping the goods in transit after he has parted
with the possession of them.
(c) a right of re-sale as limited by this Act.
(2) Where the property in goods has not passed to the buyer, the unpaid seller has, in addition to his other
remedies, a right of withholding delivery similar to and co-extensive with his rights of lien and stoppage in
transit where the property has passed to the buyer.

Seller’s lien.-
(1) Subject to the provisions of this Act, the unpaid seller of goods who is in possession of them is entitled to
retain possession of them until payment or tender of the price in the following cases, namely :-
(a) where the goods have been sold without any stipulations as to credit.
(b) where the goods have been sold on credit, but the term of credit has expired.
(c) where the buyer becomes insolvent.
(2) The seller may exercise his right of lien notwithstanding that he in possession of the goods as agent or
bailee for the buyer.

Part delivery.- Where an unpaid seller has made part delivery of the goods, he may exercise his right of lien on
the remainder, unless such part delivery has been made under such circumstances as to show an agreement to
waive the lien.

Memorandum & Article of Association

The Memorandum and Articles of Association is a legal document drawn up by a lawyer, which is required
during the incorporation of a company. This document is made up of two constituent parts - the Memorandum
of Association and the Articles of Association. The following is a brief description of this document and the
contents of its two constituent parts.
The Memorandum of Association of a company is the document which governs the relationship between that
company and the rest of the world. The document is designed to communicate to the public the company's
state of affairs, as well as its purpose of being and operating. This enables company stakeholders such as
creditors, suppliers and shareholders to evaluate the extent of their risk, as well as the possibilities of the
company being able to overcome them in the future.

This document is required to state the name and type of the company, its objectives, authorized share capital
and its original shareholders. The objects of the company include information such as what a company is
permitted to do - which therefore limits the company's capacity to act. The Memorandum acknowledges
where the company is duly registered, and usually includes clauses on the property and sources of income of
the company. The Memorandum of Association must be witnessed then notarized a notary public.

The Articles of Association of a company are the rules governing the relationship between the directors and
shareholders of the company. Together with the Memorandum of Association, the Articles of Association
constitute the constitution of a company.

The Articles of Association provide for the different voting and dividend rights attached to different share
classes, as well as restrictions on the transfer of shares. These further include a preliminary clause with word
definitions provided so as to prevent ambiguity during interpretation. This document also defines the company
and provides for its members; it provides guidelines for the resignation and termination of directors by the
Board; it also includes rules on holding annual and extraordinary general meetings, with regard to quorum,
notices of meetings, proceedings and voting. It also indicates the maximum and minimum number of directors
the company must have and how they may be disqualified; it provides for the inclusion of alternate directors,
the powers and duties of directors and their interests and proceedings at Board meetings. The Articles of
Association also include provisions for the CEO and Company Secretary, and details clauses relating to the
company seal, auditing and accounting, winding up and indemnity.

Winding proceeding of a company

Winding up of a company is defined as a process by which the life of a company is brought to an end and its
property administered for the benefit of its members and creditors.

An administrator, called the liquidator, is appointed and he takes control of the company, collects its assets,
pays debts and finally distributes any surplus among the members in accordance with their rights. At the end
of winding up, the company will have no assets or liabilities. When the affairs of a company are completely
wound up, the dissolution of the company takes place. On dissolution, the company's name is struck off the
register of the companies and its legal personality as a corporation comes to an end.

The procedure for winding up differs depending upon whether the company is registered or unregistered. A
company formed by registration under the Companies Act, 1956 is known as a registered company. It also
includes an existing company, which had been formed and registered under any of the earlier Companies Acts.

Winding up a Registered Company

The Companies Act provides for two modes of winding up a registered company.

Grounds for Compulsory Winding Up or Winding up by the Tribunal

 If the company has, by a Special Resolution, resolved that the company be wound up by the Tribunal.
 If default is made in delivering the statutory report to the Registrar or in holding the statutory
meeting. A petition on this ground may be filed by the Registrar or a contributory before the expiry of
14 days after the last day on which the meeting ought to have been held. The Tribunal may instead of
 winding up, order the holding of statutory meeting or the delivery of statutory report.
 If the company fails to commence its business within one year of its incorporation, or suspends its
business for a whole year. The winding up on this ground is ordered only if there is no intention to
carry on the business and the Tribunal's power in this situation is discretionary.
 If the number of members is reduced below the statutory minimum i.e. below seven in case of a
public company and two in the case of a private company.
 If the company is unable to pay its debts.
 If the company has made a default in filing with the Registrar its balance sheet and profit and loss
account or annual return for any five consecutive financial years
 If the company has acted against the interests of the sovereignty and integrity of India, the security of
the State, friendly relations with foreign States, public order, decency or morality.

The petition for winding up to the Tribunal may be made by :-

 The company, in case of passing a special resolution for winding up.

 A creditor, in case of a company's inability to pay debts.
 A contributory or contributories, in case of a failure to hold a statutory meeting or to file a statutory
report or in case of reduction of members below the statutory minimum.
 The Registrar, on any ground provided prior approval of the Central Government has been obtained.
 A person authorised by the Central Government, in case of investigation into the business of the
company where it appears from the report of the inspector that the affairs of the company have been
conducted with intent to defraud its creditors, members or any other person.
 The Central or State Government, if the company has acted against the sovereignty, integrity or
security of India or against public order, decency, morality, etc.

Voluntary Winding Up of a Registered Company

When a company is wound up by the members or the creditors without the intervention of Tribunal, it is called
as voluntary winding up. It may take place by:-

 By passing an ordinary resolution in the general meeting if :- (i) the period fixed for the duration of the
company by the articles has expired; or (ii) some event on the happening of which company is to be
dissolved, has happened.
 By passing a special resolution to wind up voluntarily for any reason whatsoever.

Within 14 days of passing the resolution, whether ordinary or special, it must be advertised in the Official
Gazette and also in some important newspaper circulating in the district of the registered office of the
company.

The Companies Act (Section 484) provides for two methods for voluntary winding up:-

Members' voluntary winding up

It is possible in the case of solvent companies which are capable of paying their liabilities in full. There are two
conditions for such winding up:-

 A declaration of solvency must be made by a majority of directors, or all of them if they are two in
number. It will state that the company will be able to pay its debts in full in a specified period not
exceeding three years from commencement of winding up. It shall be made five weeks preceding the
date of resolution for winding up and filed with the Registrar. It shall be accompanied by a copy of the
report of auditors on Profit & Loss Account and Balance Sheet, and also a statement of assets and
 liabilities upto the latest practicable date; and
 Shareholders must pass an ordinary or special resolution for winding up of the company.

The provisions applicable to members' voluntary winding up are as follows:-

 Appointment of liquidator and fixation of his remuneration by the General Meeting.

 Cessation of Board's power on appointment of liquidator except so far as may have been sanctioned
by the General Meeting, or the liquidator.
 Filling up of vacancy caused by death, resignation or otherwise in the office of liquidator by the
general meeting subject to an arrangement with the creditors.
 Sending the notice of appointment of liquidator to the Registrar.
 Power of liquidator to accept shares or like interest as a consideration for the sale of business of the
company provided special resolution has been passed to this effect.
 Duty of liquidator to call creditors' meeting in case of insolvency of the company and place a
statement of assets and liabilities before them.
 Liquidator's duty to convene a General Meeting at the end of each year.
 Liquidator's duty to make an account of winding up and lay the same before the final meeting.

Creditor's voluntary winding up

It is possible in the case of insolvent companies. It requires the holding of meetings of creditors besides those
of the members right from the beginning of the process of voluntary winding up. It is the creditors who get the
right to appoint liquidator and hence, the winding up proceedings are dominated by the creditors.

The provisions applicable to creditors' voluntary winding up are as follows:-

 The Board of Directors shall convene a meeting of creditors on the same day or the next day after the
meeting at which winding up resolution is to be proposed. Notice of meeting shall be sent by post to
the creditors simultaneously while sending notice to members. It shall also be advertised in the
Official Gazette and also in two newspapers circulating in the place of registered office.
 A statement of position of the company and a list of creditors along with list of their claims shall be
placed before the meeting of creditors.
 A copy of resolution passed at creditors' meeting shall be filed with Registrar within 30 days of its
passing. 

 It shall be done at respective meetings of members and creditors. In case of difference, the nominee
of creditors shall be the liquidator.
 A five-member Committee of Inspection is appointed by creditors to supervise the work of liquidator.
 Fixation of remuneration of liquidator by creditors or committee of inspection.
 Cessation of board's powers on appointment of liquidator.

As soon as the affairs of the company are wound up, the liquidator shall call a final meeting of the company as
well as that of the creditors through an advertisement in local newspapers as well as in the Official Gazette at
least one month before the meeting and place the accounts before it. Within one week of meeting, liquidator
shall send to Registrar a copy of accounts and a return of resolutions.

Patent Points
- Definition
- Necessity for patent
- How to obtain
- Things that cannot be patented
- Infringement
- Rights & duties
Things that cannot be patented
1. Contrary to well established natural law
2. Contrary to public policy
3. Discovery of things existing in nature
4. Substance formed by mixture
5. Method of agriculture or horticulture
6. Process for medical, surgical treatment
7. Mathematical or business method or computer programme or algorithm
8. Invention related to atomic energy
9. Topography of integrated circuit
10. Presentation of information
11. The laws of nature, physical phenomena, and abstract ideas.
12. A new mineral or a new plant found in the wild.
13. Inventions intended solely for use in special nuclear material or atomic energy for weapons.
14. A machine that does not serve a useful purpose.
15. Methods of doing business.
16. Printed matter.
17. In the case of mixtures of ingredients, such as medicines, a patent cannot be granted unless the effect
of the mixture is greater than the effect of its components.
18. Human beings.
19. Mere substitution of one material for another or changes in size to a previously known useful
invention without "novelty," or newness.

Necessity for patent

1. Novelty
2. Inventive step
3. Usefulness / industrial application

Intellectual Property Rights

An intellectual property right is a legal concept that confers rights to owners and creators of the work, for their
intellectual creativity. Such rights can be granted for areas related to literature, music, invention etc, which are
used in the business practices.

In general, the intellectual property law offers exclusionary rights to the creator or inventor against any
misappropriation or use of work without his/her prior knowledge. Intellectual property law establishes
equilibrium by granting rights for limited duration of time.

Every nation has framed their own intellectual property laws. But on international level it is governed by the
World Intellectual Property Organization (WIPO). The WIPO convention lays down following list of the activities
or work which are covered by the intellectual property rights -

 Industrial designs
 Scientific discoveries
 Protection against unfair competition
 Literary, artistic and scientific works
 Inventions in all fields of human endeavor
 Performances of performing artists, phonograms and broadcasts
 Trademarks, service marks and commercial names and designations
 All other rights resulting from intellectual activity in the industrial, scientific, literary or artistic fields.

Types of Intellectual Property Rights

Intellectual Property Rights signifies to the bundle of exclusionary rights which can be further categorized into
the following heads-
  Copyright

Copyright, one of the form of intellectual property right, offers exclusive rights for protecting the
authorship of original & creative work like dramatic, musical and literary in nature. Symbolized as "©"

 Patent

A patent is termed as the exclusionary rights given by the government or the authorized authority to
its inventor for a particular duration of time, in respect of his invention.

 Trademark

The trademark or trade mark, symbolized as the â„¢ and ®, is the distinctive sign or indication which is
used for signifying some kind of goods or/and services and is distinctively used across the business.

 Trade Secrets

Trade secret points towards a formula, pattern, any instrument, design which is kept confidential and
through which any business or trade can edge over its rival and can enjoy economic gain.

 Geographical Indication

Geographical Indication (GI) signifies to the name or sign, used in reference to the products which are
corresponding to the particular geographical area or somewhat related to the origin like town, region
or nation.

 Industrial Design Rights

Industrial design rights are defined as the part of the intellectual property rights which confers the
rights of exclusivity to the visual designs of objects which are generally not popular utilitarian.

Advantages of Intellectual Property Rights

Intellectual property rights help in providing exclusive rights to creator or inventor, thereby induces them to
distribute and share information and data instead of keeping it confidential. It provides legal protection and
offers them incentive of their work. Rights granted under the intellectual property act helps in socio and
economic development.

Copyright

Copyright, one of the forms of intellectual property law, offers exclusive rights for protecting the authorship of
original & creative work like dramatic, musical and literary in nature. Symbolized as "©", here the term
'exclusive rights' mean that the holder has the right to determine who will be credited with the work, who will
perform the work and who will be benefited financially from it. However, copyright does not extend any
protection to the facts, methods of operation, system, ideas except to the ways in which they can be
expressed.

Being a copyrighted item does not mean that other person can't use or write on subject matter of particular
item. For e.g, if a person has written on a new motor cycle and he has copyrighted his article then it means
that other person can't use that article but he is free to write his thoughts on the similar motor cycle.
Copyright holder does not hold the rights by themselves. Instead of it they relinquish it to publishers or big
companies by entering into the contractual agreement. Generally copyright is enforceable as civil cases but in
some jurisdiction, there are criminal infringement statutes. Criminal Sanctions are made for targeting the
counterfeiting work. There are innumerable factors which determine the length of the duration term. Like the
nature of work, the status of work i.e, whether it is published or unpublished and finally whether the work has
been created by single person or group. Generally in various part of the world, the copyright has been granted
for whole life of the author plus for 50 or 70 years. 

Indian Copyright Act, 1957

The Indian copyright act facilitates the owner for reproducing or reusing their copyrighted items, to prepare its
derivate, to public their work and to distribute copies of their creative items. Copyright aims to protect the
work of creator, transformed in a tangible form of expression. It includes art work, plays, movies, shows,
various types of music, sound and songs, books, manuscripts, written work and all types of images, photos,
pictures, drawings, graphics.

Copyright Registration

Copyright comes into effect as soon as the work is done and no formalities are required to be follow. However,
certificate of copyright registration and entries made their upon serves as the prima facie evidence, at the time
of any dispute, in the court. But there is a procedure exist for registering the both published/unpublished work
in the Register of Copyrights, maintained in the Copyright Office of the Department of Education. If the work
has been registered as the unpublished in the Register of Copyright but subsequently it is published then the
requisite changes can be made by the applicant in the Register of Copyright with addition to prescribed fees.

Procedure of Copyright

It is required to be in written form duly signed and authenticated by assignor or by his authorized agent. It
should legibly specified the amount of work and rights which are assigned to the other person. To avoid
emergence of conflict in near future, time with duration and territorial area should be explicitly mentioned. It
should clearly specify the royalty which is required to be paid to author or his legal representative. The
mentioned assignment should be clearly subject to termination, extension on terms & conditions duly agreed
and signed by both parties. There are some acts which have been put under the head of 'copyright
infringements' -

 Preparing infringing copies for the purpose of selling or hiring or let them to be hire by third party.
 Authorizing for the performance of work in such public places where such performance gives result to
the copyright infringement.
 Making distribution of the infringe copies for trading with a motto of affecting prejudicially the
copyright owner interests.
 Public exhibiting the infringing copies for the purpose of trade.
 Importing the infringing copies into the India.

Advantages of Copyright

Copyright helps in protecting the original published/unpublished work, that can be fall under the different
heads of literature, musical, dramatic, artistic and intellectual. If we say the economic and social development
of the nation relies upon the creativity skills of its people, then there would be no exaggeration. Copyright
helps in making a protective shield, which is conducive for the growth rate of writers, artists, producers,
musicians, cinematographic artists and induce them towards indulging into more creative work. By
copyrighted their creation, copyright holder can enjoys following rights -

 One can use, re use, reproduce the copies and can sell the copies.
 One can import or export whole or part of work.
 One is free to create any derivative work.
 One can publicly demonstrate its work.
 One can sell or pass its rights to other person.
 One can indulge in transmitting or displaying work by radio or video.
Trademark
The trademark or trade mark, symbolized as the ™ and ®, is the distinctive sign or indication which is used
for signifying some kind of goods or/and services and is distinctively used across the business organization or
by an individual for identifying and uniquely classifying the source or their products and/or services among
consumers and making a distinction of its products or services from the other entities. One of the part of the
intellectual property law, trademark signifies to the name, word, phrase, logo, image, design, symbol or
combination of any or all of these elements. The trademark grants rights to the owner which in turns may take
or can commence legal proceedings in case of infringement of trademark. However registration is not
compulsory in trademark. The owner of common law trademark can also file the suit but in case of the
unregistered mark, the protection granted will only be confined only to that geographical area within which it
has been used or in that area into which it is expected to be expand.

Informally the term 'trademark' is used for distinguishing those characteristics or attributes which helps in
identifying any individual. When the word 'trademark' is used in context of services rather than products, it
may called service mark. When the trademark is used for describing the product or service, instead of making a
distinction from the third parties then it is popularly called generalized trademark. As any sign which is
attributed of doing the essential required functions of the trademark may be headed under the term
'trademark'. It may include various non-conventional signs like shapes(three dimensional trademarks), smells,
sounds, moving images, taste, color and even texture. The extent to which these non conventional trade marks
are recognized or even protected varies from one jurisdiction to another. 

Advantages of Trademarks

The trademark owner is conferred upon the 'exclusionary rights' which says that the owner enjoys the right of
using the registered trademark and can indicate it by using the symbols- ™ and ® in relation of those goods
and services for which the owner has registered the trademark. At the time of any infringement, the owner
can take upon the case in the court. Trademark provides the guarantee for the unchanged quality and helps in
creating and advertising the products and services in public.

International Trademark Laws

Due to the increasing globalization of trading activities, it becomes necessary to integrate the trademark law
and policy, nucleus of which must be constancy in its various activities. The following trademark laws have
candidly enable the industrial market across the world to save their time and resources by allowing the
centralized filing system and completion of various procedures related to it.

 Agreement on Trade-Related Aspects of Intellectual Property Rights : 

Administered by the World Trade Organization (WTO), the Agreement on Trade Related Aspects of
Intellectual Property Rights (TRIPS) is the international agreement which laid down the minimum
standards for different parts of the intellectual property (IP) regulation. In the year 1994, the said
agreement was negotiated at the end of the Uruguay round of the general agreement on tariffs and
trade (GATT). The TRIPS encompasses of the various requirements which laws in different countries
are required to abide for along with the specification of the procedures, remedies and disputes. In the
Article 15(1) of TRIPS, 'sign', which has been used in part or form of the 'trademark' in the trademark
legislation of various jurisdiction in throughout the world.
 The Madrid system for the international registration of marks : 
The madrid system is seen as the pivotal international system for enabling the trademark registration
in more than one jurisdiction. It offers the centrally administered system for achieving the trademark
registrations in the jurisdiction of member nations by extending and facilitating the protection of the
international registration obtained through the World Intellectual Property Organization. The
international registration is said to be based on the application or registration which is acquired by
the trademark applicant within its home jurisdiction. The foremost benefit derived from the madrid
system is that it facilitates the trademark owner in obtaining trademark protection in multiple
jurisdictions by filing the application only in 1 jurisdiction on the payment of one set of fees. This
system allows the applicant to make amendments and complete registration process across all the
 jurisdictions by applying through the single administrative process. Moreover, it is easy to extend the
international registration coverage to the other member jurisdictions at any given point of time.
 Trademark Law Treaty : 
The trademark law treaty aims to establish the system through which jurisdictions of member nations
agree for standardizing the various procedural requirements of the registration process in connection
to the trademark.
 The Communal Trademark System : 
It is the super national trademark system which is prevalent in the European union.

Trademark Laws in India

The Indian trademark law defines the trademark as the signature, device, word, invented word, letter,
numeral, brand, name written in the particular style, the shape of goods other than those for which the mark is
intended to be used, or any combination thereof or the combination of colors etc. Except in certain cases, the
trademark may also signified by the name of living or dead person. The trademark helps in making an
identification of the goods and services along with its origin. It helps the trademark holder to advertise its
products or/and services and also creates a good image in the mind of its final consumer but the trademark
chosen should be capable of making a distinction between the goods or services of different people.
Furthermore, it should not be deceptively identical to the existing mark of the other person and should not be
such that which is restricted in the act.

In India, any person who claims to be the trademark proprietor can apply for the trademark registration of the
goods and services. For registration, the application can be filed in the Trademark Office, in whose jurisdiction
the principal place of your business falls. If the principal office is not situated in India then the applicant can file
the application in the trademark office in whose jurisdiction the lawyer appointed by the applicant is situated.
In case it is the company which is yet to be formed then anyone can apply for the registration on the behalf of
the company. It is prudent to make a proper search in the trademark office for ensuring that your registration
may not be canceled due to the similarity of the proposed mark to the already existing one. In India, the
registration term of the trademark is 10 years which can be renewed further for next 10 years by paying the
renewal fees.

In India, only the trademark proprietor whose trademark has been registered can put the symbol ® into use.
If any use the symbol without the registration of mark he/she will be held under illegal use of the trademark. If
anyone is engage in selling or providing services by using the false trademark he/she will be entitle to the
penalty of minimum 6 months which may extend to maximum of 3 years and with the fine of not less than
Rs.50,000 and which can extend to Rs.2,00,000.

Lifting of corporate veil

Key points

- the veil of incorporation may be lifted where a company is a sham and no third party has an
involvement with it
- it may also be lifted where the company is a party to a fraud
- it will not be lifted just because justice demands
- a director can escape personal liability to a third party in negligence by acting through his company
and ensuring that he is perceived as accepting no personal liability for what he is doing
- he cannot escape personal liability where he acts fraudulently on behalf of his company

Digital Signature
A digital signature or digital signature scheme is a mathematical scheme for demonstrating the authenticity of
a digital message or document. A valid digital signature gives a recipient reason to believe that the message
was created by a known sender, and that it was not altered in transit. Digital signatures are commonly used for
software distribution, financial transactions, and in other cases where it is important to detect forgery or
tampering.
Digital signatures employ a type of asymmetric cryptography. For messages sent through a non secure
channel, a properly implemented digital signature gives the receiver reason to believe the message was sent
by the claimed sender. Digital signatures are equivalent to traditional handwritten signatures in many respects;
properly implemented digital signatures are more difficult to forge than the handwritten type. Digital signature
schemes in the sense used here are cryptographically based, and must be implemented properly to be
effective. Digital signatures can also provide non-repudiation, meaning that the signer cannot successfully
claim they did not sign a message, while also claiming their private key remains secret; further, some non-
repudiation schemes offer a time stamp for the digital signature, so that even if the private key is exposed, the
signature is valid nonetheless.

Below are some common reasons for applying a digital signature to communications:
Authentication

Although messages may often include information about the entity sending a message, that information may
not be accurate. Digital signatures can be used to authenticate the source of messages. When ownership of a
digital signature secret key is bound to a specific user, a valid signature shows that the message was sent by
that user. The importance of high confidence in sender authenticity is especially obvious in a financial context.
For example, suppose a bank's branch office sends instructions to the central office requesting a change in the
balance of an account. If the central office is not convinced that such a message is truly sent from an
authorized source, acting on such a request could be a grave mistake.
Integrity

In many scenarios, the sender and receiver of a message may have a need for confidence that the message has
not been altered during transmission. Although encryption hides the contents of a message, it may be possible
to change an encrypted message without understanding it. (Some encryption algorithms, known as non-
malleable ones, prevent this, but others do not.) However, if a message is digitally signed, any change in the
message after signature will invalidate the signature. Furthermore, there is no efficient way to modify a
message and its signature to produce a new message with a valid signature, because this is still considered to
be computationally infeasible by most cryptographic hash functions.
Non-repudiation

Non-repudiation, or more specifically non-repudiation of origin, is an important aspect of digital signatures. By

this property an entity that has signed some information cannot at a later time deny having signed it. Similarly,
access to the public key only does not enable a fraudulent party to fake a valid signature. This is in contrast to
symmetric systems, where both sender and receiver share the same secret key, and thus in a dispute a third
party cannot determine which entity was the true source of the information.
GI

“Trademarks allow consumers to identify the products of companies that have satisfied them in the past. Thus,
a trademark becomes an asset of the firm, embodying its accumulated goodwill. When governments grant
firms exclusive property rights to their marks, they protect firms’ investments. Without such protection, firms
would find it difficult to appropriate the benefits from maintaining the quality of their products and would
have less incentive to do so.”

“Geographical indications are understood by consumers to denote the origin and the quality of products.
Many of them have acquired valuable reputations which, if not adequately protected, may be misrepresented
by dishonest commercial operators. False use of geographical indications by unauthorised parties is
detrimental to consumers and legitimate producers. The former are deceived and led into believing to buy a
genuine product with specific qualities and characteristics, while they in fact get a worthless imitation. The
latter suffer damage because valuable business is taken away from them and the established reputation for
their products is damaged.”

Three elements to the definition of GIs are identifiable, which constitute the conditions for the grant of
protection.
1. The indication must necessarily identify a good. The indication can take the form of a word/phrase
or be an iconic symbol or emblem. Thus, iconic symbols like the Pyramids for Egyptian goods, the Taj
Mahal for Indian goods, or the Statue of Liberty for American goods are permissible. Further, as there
is no requirement for the indication to be a direct geographical name, non geographical indications
are permitted. This aspect of the TRIPS definition has not been missed by legislators in India where
interest in protecting an indication like ‘Basmati’. Finally, the use of the term goods’, rather than
‘products’.
2. The good must necessarily possess ‘given quality’, a ‘reputation’ or ‘other characteristics’ that are
‘essentially attributable’ to the designated geographical area of origin. What is important here is that,
ceterius paribus, each one of these qualifiers is on its own an adequate condition for the grant of
protection.
3. It is necessary for the designated geographical area to be identified in some manner through the
indication-good link. This would require a level of homogeneity (across goods and manufacturing
units) in the distinguishing features (quality etc.) of the good to be achieved across the designated
geographical area. Moreover, according to one commentator the definition requires the goods to
originate in the territory, region or locality, which would deny possibility of issuing licenses for use of
GIs.

Particularly where GIs are available through a sui generis legislation (e.g. the EC system), GIs are
public/collective rights that are not vested in an individual firm, person or enterprise. According to the
Secretariat’s survey, eligibility criteria seek to ensure that producer associations, public entities, local or
regional governments, etc. are the appropriate bodies initiating the application process. Moreover, in some
cases the producer group is not the owner of the right but only a user of the GI much like any other entity that
fulfils the conditions specified by the GI, as such a ‘collective’ right. Yet, the survey also notes that in
jurisdictions, where the legal means are not through a sui generis law but, say, through trademark law (e.g. the
US system), then it is possible for collective/private rights like certification marks38 to be available.

Right to License
Following from above and in jurisdictions with a sui generis legislation, the scope of protection does
not include the ‘right to assign’ an indication – a right that exists for trademarks and patents within
the TRIPS Agreement. While some observers may consider this as circumscribing the scope of
protection to GI-holders, it is also appreciated as a feature of GIs that corresponds with its
public/collective right ethos. To be clear, all enterprises fulfilling the conditions specified in a GI have
the ‘right to use’ the indication but do not have the ‘right to authorise use’ to others. It is useful to
note that in jurisdictions where the ‘legal means’ are provided through laws other than a sui generis
system the right to authorise use might be provided. Thus, for example, if an IGO is protected as a
collective or certification mark then the owners of the mark possess the right to license the mark. For
example, in the US, the owner of the certification mark usually does not apply the mark (as in the case
 of trademarks) but assigns or authorises others to use the mark on goods or services upon their
meeting certain requirements

Confusingly Similar ‘Marks’

When comparing the protection granted to GIs to the protection granted to trademarks, it has been
noted that the latter is relatively expansive since ‘confusingly similar marks’ will be automatically
considered infringing. In comparison, GIs are not granted any such provision to widen the economic
space of an indication to include ‘confusingly similar indications’.

Duration of Protection
In general, where GIs are protected through a sui generis legislation, protection is offered without a
fixed limit in time and without procedures for renewal. Where renewal is required this occurs at
intervals of about 10 years. However, in these jurisdictions it is also the case that GIs may lapse and
be revoked if it falls into disuse or standards are not maintained. In other juridical systems, GIs have
to follow provisions for renewal that exist for collective marks, trademarks etc. as the case might be.

Geographical Origin
Following on from the definition of GIs, any good to be protected must originate in the territory,
region, or locality indicated in the designation.

there are six components to the scope of protection:

1. Misleading the Public
Provisions exist to prohibit the use of indications (words, phrases, symbols and images) that will
mislead the public about the good’s geographical origin. Thus, the use of iconic symbols like the
pyramids or the Taj Mahal to infer the good’s association with Egypt and India respectively or the use
of a language or script to impute erroneous geographical origin is prohibited. The holder of the
infringed indication has to bear the burden of proof in establishing that consumers have been misled.
Principle for stronger protection by directly prohibiting the use of indications for wines and spirits on
wines and spirits that do not originate in the place indicated by the GI in question even where the
true origin of the goods is indicated. Moreover, the translated use of indications for wines and spirits
by phrases such as ‘like’, ‘imitation’, etc. is also strictly prohibited. To continue, the burden of proof is
nominal in that it requires verifying the true geographical origin of the goods deemed to be infringing.

2. Unfair Competition
The second element of the scope of protection, protection against the use of indications in a manner
that are deemed to be acts of unfair competition, is considered an important achievement given the
opposition to earlier attempts. According to WIPO’s International Bureau, affecting this element of
the scope of protection might require significant effort: “In order to be successful in such an action,
the plaintiff must show that the use of a given geographical indication by an unauthorised party is
misleading and, as the case may be, that damages or a likelihood of damages results from such use.
An action against the unauthorised use of a geographical indication based on unfair competition can
only be successful if the geographical indication in question has acquired distinctiveness or, in other
words, if the relevant public associates goods sold under that geographical indication with a distinct
geographical origin and/or certain qualities. Since law suits based on passing off or unfair
competitions are only effective between the parties of the proceedings, the distinctiveness of a given
geographical indication must be shown every time that geographical indication is enforced.”

3. Trademarks and GIs

In general terms, TRIPS allows for refusal or invalidation of a trademark which contains or consists of a
GI when the said goods do not originate in the territory indicated. The interface between GIs and
trademarks is complex. As a general rule, trademarks must be distinctive so as to fulfil the role of
distinguishing goods/services of one manufacturer from those of another. Consequently, the general
proposition that GIs are excluded from the domain of trademarks. Yet, there are many conceivable
and real instances where a trademark consists of or contains a GI. For example, the use of Antarctica
as a trademark for bananas is considered permissible as there is no deceptive element in terms of
implying geographical origin. Moreover, trademarks can consist of GIs in other circumstances, such as
when the use of a GI is entirely fanciful, though not denoting geographical indication per se, and the
trademark is considered distinctive as in the case of ‘Mont blanc’ for high quality writing equipment
and ‘Thames’ for stationery. It could also be the case that the reputation of a trader endows the GI
with secondary significance leading to an identification of the trader as such.

4. Deceptive Indications
A range of situations can be identified where indications are literally true but nonetheless their use is
considered misleading. This may be the case with deceptive indications and/or homonymous
indications. Producer groups in the ‘original’ region in the imperial country could prohibit use of the
indication by the expatriates.

5. Homonymous Indications
Homonymous indications refer to that set of indications where the indications originate in different
countries but are actually spelt or pronounced similarly. A wellknown example is that of ‘Rioja’ – an
indication for wine originating in regions with the same name in Spain and in Argentina. As noted in
earlier, honest use of the indication by producers in each of the different countries is envisioned and
obliges each Member to “determine the practical conditions under which the homonymous
indications in question will be differentiated from each other”, while ensuring equitable treatment of
producers and that consumers are not misled.

6. Multilateral Register
The TRIPS Agreement obliges Members to enter into negotiations “concerning the establishment of a
multilateral system of notification and registration” of GIs for wines to “facilitate” their protection.