Assignment and Licensing of

Trade marks
Dr. Ruchir Singh
Assistant Professor
Bennett School of Law
Introduction…
Assignment and Transmission have been defined under Section 2(1) (b)
and 2(1)( zc) of the Trade Marks Act, 1999 respectively. Section 2(1) (b) defines
“assignment” as assignment in writing by act of the parties concerned. Under
section 2(1)(zc) “transmission” means transmission by operation of law,
devolution on the personal representative of a deceased person and any other
mode of transfer, not being assignment.

Assignment of trade mark involves transfer of ownership of the trade mark

to another person or entity. The provisions concerning assignment and
transmission of trade mark are contained in section 37 to 45 of the Trade marks
Act, 1999 read with rule 75 to 85 of the Trademarks rules, 2017.
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• Section 37 entitles the registered proprietor of a trade mark to assign the trade
mark and to give effectual receipts for any consideration for such assignment.
Under the new Act, a registered trade mark is assignable and transmissible
whether with or without goodwill of the business either in respect of all goods
or services or part thereof. The assignment or transmission of trade mark has
been prohibited under Section 40, where multiple exclusive rights would be
created in more than one person in relation to same goods or services; same
description of goods or services; or goods or services or description of goods
or services associated with each other, the use of such trade marks would be
likely to deceive or cause confusion.
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• Assignment of a trade mark without goodwill of business is not allowed
unless the assignor obtains directions of the Registrar and advertises the
assignment as per the Registrar’s directions. The assignment and
transmission of certification trade marks is allowed only with the consent of
the Registrar. Associated trade marks are assignable and transmissible only
as a whole but they will be treated as separate trade marks for all other
purposes.

• The assignment and transmission of trade marks is are absolute. The validity
of the assignment can be challenged only on the basis of the provisions
Different kinds of Trademark Assignments
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1. Complete Assignment: – The owner of the trademark assigns all rights in the trademark to
a new owner, including the ability to receive royalties and make additional transfers.
For instance, X is the owner of the brand “ABC.” By way of a contract, X totally transfers
to Y his trademark “ABC.” After that, X will not have any legal claim to the “ABC” brand.

2. Partial Assignment: – Regarding only particular services or items, the trademark owner
assigns the trademark to a different party with respect to only specific services or goods.
The sale of the trademark’s ownership is limited to certain services or goods.
For instance, X is the owner of the sauce and dairy product brand ABC. X transfers to Y
the rights to the brand “ABC” regarding exclusively dairy goods while keeping the rights
regarding sauces.
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3. Assignment with Goodwill of Business: – The owner of a trademark
transfers to another person the privileges, rights, values, entitlements and
values associated with a trademark. Here, the absolute ownership over the
rights and value of a trademark associated with the product is transferred from
one entity to another. When a trademark is assigned along with goodwill, the
assignee is permitted to use it for any category of products or services,
including those that the assignor was already using.
For instance, X is the owner of the “Sherry” hair product brand. X assigns the
goodwill of the “Sherry” brand to Y. Y will be permitted to use the “Sherry”
name in relation to food goods and any other products they produce.
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4. Assignment without the Goodwill of Business: – The trademark owner assigns to
the assignee all rights and entitlements in the trademark regarding goods or services
that are not in use. The assignment without goodwill is also known as “gross
assignment”. In the event of an assignment without goodwill, the assignor places
restrictions on the transfer of trademark rights. The assignor transfers the trademark
with the caveat that the assignee is not permitted to use it in connection with any
products or services that the assignor is currently using.
For instance, “A” is the owner of a brand and uses his trademark for selling
computers. “A” sells his brand to “B” such that “B” will have no rights to use the
brand trademark for selling his computer products. However, “B” can use the brand
trademark in the chain of businesses other than a computer.
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• Conditions for assignment and transmission under Section 42

Section 42 of the Trademark Act outlines the conditions for the assignment and
transmission of a trademark, specifically when it is not associated with the goodwill
of a business. According to this section, the assignment or transmission of a trademark
without goodwill will only be effective if the assignee applies to the registrar for
directions regarding the advertisement of the assignment.

The assignee must advertise the assignment within the timeframe specified by the
Registrar, which should not exceed six months from the date of the assignment or an
extended period of three months if permitted by the Registrar. Additionally, if the
assignment includes goods for export or services used outside of India along with the
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• Restrictions on Assignment of Trademarks

The Trademark Act imposes certain restrictions on the assignment and

transmission of trademarks to prevent confusion among users or the
general public. These restrictions include:

Restriction on assignment or transmission that would create multiple

exclusive rights.

Restriction on assignment or transmission that would create exclusive

rights in different parts of India.
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• Process of Assignment and Transmission of Trademark (Section 45)
The process for the assignment and transmission of a trademark, as described
in Section 45 of the Trademark Act, involves the following steps:
Application to the Registrar of Trademarks using Form TM-P, along with
duly certified original documents.
The Registrar will review the application and provide a decision within three
months. The decision may include informing the applicant about the
assignment or requesting additional proof if there are doubts.
If the assignment is approved, the Registrar will make an entry in the
Register, including details such as the name and address of the assignee, the
date of the assignment, a description of the rights assigned (if applicable), the
basis of the assignment and the date of entry in the register.
In case of a dispute between the parties regarding the validity of the
assignment or transmission, the registrar may refuse to register it until the
rights of the parties have been determined.
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• Assignment and Transmission of Registered Trademark (Section 38)

Section 38 of the Trademark Act states that a registered trademark can be

assigned and transmitted, with or without the goodwill of the business
associated with it. This can apply to all the goods or services covered by the
registered trademark or only to a specific subset of goods or services.

• Assignment and Transmission of Unregistered Trademarks (Section 39)

According to Section 39 of the Trademark Act, an unregistered trademark can

also be assigned or transmitted, with or without the goodwill of the business
concerned.
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• Benefits of Assignment and Transmission of Trademark

Expansion of business: By assigning and transmitting a trademark, the owner can

expand their business by using the same trademark in multiple locations
simultaneously. Additionally, partial authority can be given to assign the trademark to
more than one person.

Leveraging an established brand: Assigning and transmitting a trademark allows the

assignee to benefit from an already established brand in the market, saving them the
effort and resources required to create a new brand.

Legal proof: The assignment and transmission of a trademark serve as legal proof in
case of any disputes related to trademark usage. The rights and liabilities associated
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• Monetary benefits: The owner of the trademark can enjoy monetary
benefits through the assignment and transmission process, including
any financial gains resulting from the assignment or transmission.
Furthermore, operating with the same trademark in multiple locations
can increase the value of the brand.
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• The following steps are included in the trademark assignment process in India:
1.Through a trademark assignment agreement, the trademark owner (assignor)
transfers his or her ownership of the mark to the assignee;
2.By submitting an application of a trademark assignment in Form TM-P to the
register of trademarks, the assignor, assignee, or both, may make a combined
request to register the assignment;
3.Within six months of the assignment date, Form TM-P must be submitted to the
trademark registrar. After six months of assignment, the application can be
submitted, however the fee may change appropriately;
4.The assignment must be publicised in the manner and for the duration specified
by the trademark registrar;
5.The trademark registrar’s office should receive a copy of the advertisement and
the registrar’s instructions; and
6.The trademark registrar will register the assignee as the proprietor of the
trademark and record the specifications of the assignment in the register upon
receipt of the trademark assignment application (form TM-P) and necessary
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• Structural Waterproofing and ORS v. Amit Gupta ORS [93 (2001) DLT
496]

In this case, a dispute arose regarding the assignment and transmission of a

trademark. The court highlighted that the registrar has the authority to refuse the
registration of the assignment and transmission until a decision is made by the
competent court. The plaintiff claimed ownership of the trademark based on a
Memorandum of Understanding (MoU) between the parties.

However, the court rejected the plaintiff’s request for an injunction against
the defendant. The court emphasised that a change in the name of the registered
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• Cinni Foundation v. Raj Kumar Shah and Sons [2009 (41) PTC 320 (Del)]

In this case, the trademark “CINNI” was being used by the owner. A deed of
assignment had been executed and signed between the parties. However, it was later
discovered that the trademark was not registered. The defendant attempted to claim
rights over the trademark. The court ruled that according to the law, the assignee
acquires no title to the trademark without the registration of the assignment deed.
Consequently, the defendant’s claim to the trademark was dismissed.

These cases illustrate the importance of registration and proper documentation in

the assignment and transmission of trademarks. Registration provides legal protection
and establishes ownership rights, while adherence to the legal requirements ensures the
validity and enforceability of the assignment or transmission of the trademark.
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• Meaning of Licensing of Trademarks: – Licensing of Trademarks
simply means the permission granted by the owner of the
trademark to a third person. Such a license is granted in consideration
of a Royalty. For Example: – Where an owner of a brand authorizes and
allows a third party to use its brand/mark in the course of trade for
goods/services. The most important thing to remember is
that ‘licensing’ is not sale of the mark or absolute transfer. The
ownership to the mark is retained by the owner/holder and only a limited
right to use, sell products under the mark etc are given to the third party.
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• Process for Registration of a Trademark License

A Registered User is currently registered under Section 49 of the Trademarks Act of

1999. In this case, the Licensee is the Registered User. Permitted use of a trademark is
defined under Section 2(1)(r) of the Trademarks Act. Thus both registered and
permitted users can be the licensees.

By a registered user of the trademark in relation to goods or services:

1. With which he is connected during trade;

2. In respect of which in the trademark remains registered for the time being;

3. For which he is registered as a registered user;

4. Which complies with any conditions or limitation to which the registration of the registered
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By a person other than the registered proprietor and registered user in

relation to goods or services:

1. With which he is connected during trade;

2. In respect of which the trademark remains registered for the time being;

3. By consent of such registered proprietor in a written agreement; and

4. Which complies with any conditions or limitation to which such user is

subject and to which the registration of the trademark is subject”.

Continued…
The registration of a trademark license agreement is not mandatory under the
law. But registration always comes to the rescue as it forms a record/ evidence in
possible future disputes.

In the case of Himalaya Drug Co. Pvt. Ltd., Bangalore vs. Arya Aushadhi
Pharmaceutical Works, Indore, AIR 1999 MP 110, the Court ruled that if a
company fails to prove that it is a registered user then the suit is liable to be
dismissed. It is therefore always good to register the Trademark License with the
Trademark Office. Only a Registered owner/ Proprietor of the Trade Mark is
competent to launch proceedings for the trademark infringement as per the
Trademarks Act, 1999. If a User is not registered under the act then he cannot
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• Therefore, to register the trademark license:

1. The agreement must be in writing;

2. The trademark owner and the intended user should apply for registration (section 49) with
the Trademark Registrar jointly;

3. The form to use for the application is TM-U;

4. An affidavit signed by the owner of the trademark and authenticated by him or her,
detailing the license’s terms and specifying the following: –
1. Relationship between the parties

2. Duration of the use

3. Goods/services for which it is applicable

Continued…
According to the Act’s provisions, a registered user may be granted
permission to use a registered trademark, but in order to do so, the registered
owner of the Trade Mark must enter into a contract with the prospective
registered user.

Within six months of the date the parties’ agreement was formed, an
application for registration must be submitted. If everything is acceptable, the
Trademark Office (TMO) will subsequently register the user. Following that,
the user will be a “Registered User” of the trademark.

• The Trademark Office will notify the trademark owner and any other
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• Cancellation is possible in the following situations:

1.If the provisions of the agreement are broken or violated;

2.If the mark is used in a manner not permitted under the agreement;

3.If the mark is utilised to trick consumers or the public by creating confusion;

4.If any party withholds information that is important and necessary to the agreement;

5.If one of the parties makes false statements or cheats.

The Trademark Office notifies the Trademark owner as well as any additional
registered users who might be impacted by the cancellation of the Trademark License.
The official cancellation cost is Rs. 4500 for each mark.
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Conclusion…