Chapter - 05 Consumer Protection
C o n t e n t -
• Introduction
• Consumer Movement
• The Consum er Protection Act
• Consum er Dispute Redressal Agencies
• The Sale of Goods Act
• The Essential Commodities Act
• The Drugs and Cosmetics Act
• The Prevention of Food Adulteration Act
• The Design Act
• Intellectual Property Rights
• Certification M arks in India Introduction -
This chapter covers the constitutional provisions available for counterfeiting and piracy. Chapter also provides history of consumer movement in India and its progress.
Further it discusses various Acts available for protecting consumer’s rights against counterfeiting and piracy. This chapter also mentions Intellectual Property Rights with special reference to Patent, Copyright and Trademark. At the end it discusses about some of the Statutory and Non-statutory certification marks available in India.
“Consumer” is an important part of economic activities; he has the power to influence demand and supply in economy. The act of consumption is the most fundamental need of living being which always inspired humans to try innovative things in life.
Consumption is the process that starts with life and ends with life. Consumer thus becomes an important factor in market.
A person w h o spends m o n e y alw ays expects value for m o n e y in return i.e. right quality, right quantity, right price etc... Former U S President ‘J. F. Kennedy’ is the one who is responsible for making world aware about revolutionary concept of
“Rights of Consumers” it includes four basic consumer rights as - Right to Safety,
Right to Information, Right to choice and Right to a fair hearing by government. 15*'’
March 1983 was the day when first “World Consumer Rights Day” was observed. In
India 24"’ December is considered as the National consumer rights day.
Consumerism popularly known as “Consumer movement” started in India since 1966.
In India, consumer movement has its roots in the growth of trade and commerce for many centuries, even though there are few isolated incidents of consumer redressals since historic times. ‘Kautilya’s Arthashastra’ mentions the strong punishments for exploitation by trade and industry. ‘Mauryan’ rulers were known to have awarded punishments for adulteration of food and even ‘Mughals’ were known to have enforced price control mechanism strictly.
199 5.1 Consumer Movement -
Consumer movement was influenced and received new directions based on the works of a few key personalities in different parts of the world. To mention key pioneers in this area - ‘Ralph Nader’’ of U S A has been a moving force behind the growth and sustenance of the consumer movement in U S A , and thereby a guiding force for the rest of the world. ‘Michael Young’ of U K is a well known authority in the area of consumer movement as the first director of consumer association, and first chairperson of National Consumer Council, he demonstrated dynamism towards making consumerism a social movement and a concern for ordinary consumers.
‘Anwar Fazal’ of Malaysia and ‘Toyohiko Kagawa’ of Japan, the father of the
Japanese consumer cooperation movement are the few other prominent figures in the development of consumer movement.
Consumer Movement in India -
In India, tide o f co nsum er m o v e m e n t w o u ld not have started, until the efforts o f
‘Father of Nation’, “M . K. Gandhi”. His belief was that, “A customer is the most important visitor on our premises. H e is not dependent on us. W e are dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an outsider to our business. H e is part of it. W e are not doing a favor by serving him. He is doing us a favor by giving us an opportunity to do so.^” During independence struggle, non-cooperation movement boycotted foreign goods symbolizes the organization of consumer movement in India.
The consumer movement in India was started in 1966 with the setting up of Consumer
Guidance Society of India was formed in Mumbai with the objective to protect consumers against rising prices of essential commodities. In the same year council for
Fair Business Practices was formed by leading industrialists like J.R.D. Tata and
Ramkrishna Bajaj. The Indian Consumers Union was established in 1971. The
' Bollier, D. (1991). Citizen Action and Other Big Ideas: A History of Ralph Nader and the Modem Consumer Movement Washington, D.C. Retrieved on 2012, December 27 from http://www.nader.org/history. ^ Retrieved on 2012, May 13 from http://www.mkgandhi.org/faq/q7.htm 200 activities o f this union include offering legal advice, testing facilities, arranging
lectures and seminars. ‘The Consumer Education and Research Centre’ was formed in
1978 at Ahmadabad to guide and protect consumer rights. Consumers Cooperative
Societies like, Grahak Panchayat and Government Employees Consumer Stores etc...
make their purchases directly from producers and sell them at reasonable prices to members. The Sahakari Bazars in urban areas have made a great contribution in protecting consumer interest. The growth of consumer movement in India is very slow due to several reasons such as the illiteracy o f Indian consum er, general attitude of the public, lack of active support from political parties and other members of the
society.
In m odem India, many laws were enacted to protect the consumers against various types of malpractices such as inferior quality products or services, false information, fraud selling etc... However consumers’ awareness about enactments is relatively less and access to related information is poor. Low literacy rate, ignorance of the consumers, low income etc... are the factors that works against the development of consumer awareness, which resulted in the lack of coordination among different agencies.
Indian consumers as compared to western consumers have certain reservations regarding the com plaint m e ch an ism , due to different factors o f social-cultural environment. Majority people of India, being deeply religious minded have developed an attitude o f self-satisfaction over the centuries, w h ic h gets reflected in their purchase behavior and post purchase behavior as well. Unlike the western consumers, who are quite aggressive by nature, Indian consumers are passive in nature regarding consumer movement. Their learning and behavior modification regarding the consumer laws and consumer protection have yet to develop to western levels.
Compared to the well developed western consumer movement, the Indian consumer movem ent is still in its early stage.
In modem economy, the government has minimum interference in economic activities. The producers and suppliers decide the quantity, quality, distribution and price of the goods and services produced, especially the consumer goods. As a result, some profit seeking entrepreneurs may adopt such policies and practices that are
201 against the interests of the consumers. The producers may produce or offer adulterated, fake or low quality products as sell it at the highest possible price or discriminating price. They may provide the consumer with misleading advertisement or wrong information about the company, deceptive packaging, exaggeration of claims and false quantity of products.
The Indian government also gave importance of protection of consumer rights from unethical suppliers and several laws were made to serve the purpose. Some of them are the Indian Contract Act, The sale of Goods Act, The Dangerous Drugs Act, The
Agricultural Produce (Grading and Marketing) Act, The Indian Standards Institution
(Certification Marks) Act, the prevention of Food Adulteration Act, The Standards of
Weights and Measures Act, etc... Although these acts serve the purpose of protecting consum er interests u p to so m e extent, they require the consum er to initiate action by way of a civil suit involving lengthy legal process which is very expensive and time consuming as well.
202 5.2 Consumer Protection Act, 1986 ^ -
A n A c t to provide better protection for the interests o f co nsum ers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumers’ disputes and for matters connected therewith.
Applicability of Act: This Act amended in 2002 applies to all goods and services unless specifically exempted by the Central Government. It is applicable to all private, public or cooperative sectors. This Act extends to the whole of India, except the state of Jammu and Kashmir.
Who is a CONSUM ER?
“Consumer” means any person who-
i) Buys any goods for a consideration which has been paid or promised or
partly paid and partly promised, or under any system of deferred payment
and includes any user of such goods other than the person who buys such
goods for consideration paid or promised, or under any system of deferred
payment when such use is made with the approval of such persons, but
dose not include a person who obtains such goods for resale or for any
commercial purpose.
ii) Hires or avails of any services for a consideration which has been paid or
promised or partly paid and partly promised, or under any system of
deferred payment and includes any beneficiary of such services other than
the person who ‘hires or avails’ of the services for considerations paid or
promised, or partly paid and partly promised, or under any system of
deferred payment, when such services are availed of with the approval of
the first mentioned person but does not include a person who avails of
such services for any commercial purposes.
^ National Consumer Dispute Redressa! Commission (NCDRC), Retrieved on 2012, August 25 from http://ncdrc.nic.in/l_l .html 203 “Consumer dispute” (According to Sec. 2 (e)) means a dispute where the person
against w ho m a complaint has been made, denies or disputes the allegations contained
in the complaint.
“Defect” (According to Sec. 2 (f)) means any fault, imperfection or shortcoming in
the quality, quantity, potency, purity or standard which is required to be maintained
by or under any law for the time being in force under any contract, express or implied
or as is claimed by the trader in any manner whatsoever in relation to any good;
“Deficiency” (According to 2 (g)) means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service;
“Spurious goods and services” (According to 2 (oo)) means such goods and services which are claimed to be genuine but they are actually not so;
“Unfair trade Practice” (According to 2 (r)) means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service adopts any unfair method or practice as (to mention few of them) -
i. Falsely represents that the goods are of a particular standard, quality, quantity,
grade, com position, style or m odel,
ii. Falsely represents that the services are of a particular standard, quality or
grade,
iii. Falsely represents any re-built, second-hand, renovated, reconditioned or old
goods as new goods,
iv. Represents that the goods or services have sponsorship, approval,
performance, characteristics, accessories, uses or benefits which such goods or
services do not have,
V. Makes a false or misleading representation concerning the need for, or the
usefulness of, any goods or services.
204 vi. Gives public any warranty or guarantee of the performance, efficacy or length
of life of a product or of any goods that is not based on an proper test thereof;
product fails to delivered according to expectations,
vii. Gives false or misleading facts disparaging the goods, services or trade of
another person, viii. Permits the publication of any advertisement whether in any newspaper or
otherwise, for the sale or supply at a bargain price, of goods or services that
are not intended to be offered for sale or supply at the bargain price,
- “ B argain price” is a price that is stated in any advertisement to be a
bargain price, by reference to an ordinary price or otherwise, or a price
that a person who reads, hears or sees the advertisement, would
reasonable understand to be a bargain price having regard to the prices
at which the product advertised or like products are ordinarily sold,
ix. Manufacture of spurious goods or offering such goods for sale or adopts
deceptive practices in the provision of services.
Overall this act provides the base to protect c o n su m e r’ s interest. T h e provisions incorporated in this act are very useful for settlement of consumer disputes and let market transactions workout in an hassle free environment.
205 5.3 Consumer Dispute Redressal Agencies -
The Act set up three Redressal Agencies to resolve consumer disputes -
1. District Consumer Dispute Redressal Forum:
Popularly known as District Forum, deals with complaints where the value of
goods, services and compensation, if any claimed does not exceed ? 20 lakhs.
At present there are 629 District Forums in India.
Each District Forum consist - a person as a President; who is qualified to be a
District Judge, and two other members, one of whom shall be a women and
should acquired prescribed qualification as mentioned in act.
Complaint can be made by any Consumer, (Section 12 under CPA) any
recognized c o n su m e r association, one or m ore consum ers having sam e interest
or Central Government or the State Government, as the case may be, either it
its individual capacity or as a representative on the interests of the consumers
in general. O n the receipt of the complaint made under sub-section (1), the
District Forum may, by order aloow the complaint to be proceeded with or
rejected.
District Forum shall, on admission of a complaint, if it relates to any good
(Section 13 under C PA ) - refer a copy of the admitted complaint, within
twenty-one days from the date of its admission to the opposite party
mentioned in the complaint directing him to give his version of the case within
a period of thirty days or such extended period not exceeding fifteen days as
m ay be granted by the District Forum.
Every complaint shall be heard as expeditiously as possible and endeavor shall
be made to decide the complaint within a period of three months from the date
of receipt of notice by opposite party where the complaint does not require
Vaz, M. (2010), Marketing and Human Resource Management, Manan Prakashan, Mumbai, India.
206 analysis or testing of commodities and within five months it requires analysis
or testing of commodities. In the event of complaint being disposed of after
the period so specified, the District Forum shall record in writing, the reasons
for the same at the time of disposing of the said complaint.
After the successful hearing, if District Forum is satisfied that the goods
complained against suffer from any of the defects specified in complaint, it
shall issue an order to opposite party directing him to do one or more of the
following things (Section 14 under C P A ) -
• To remove the defects from the goods in question.
• T o replace the goods with n e w goods o f similar description, this shall
be free from any defects.
• To return to the complainant the price of goods in question.
To award consumer any compensation, for any loss or injury
suffered by the consumer during consumption of good in question.
T o discontinue the unfair trade practice or not to repeat it.
Not to offer the hazardous goods for sale.
Any person aggrieved by an order made by the District Forum may prefer an appeal against such order to the State Commission within a period of 30 days from the date of the order, in such form and manner as may be prescribed.
Following table indicates the current status of cases filed or disposed or pending in
District Forum in India.
207 Table N o .5.1
State W ise Status of Cases filed or disposed or pending in District Forum
Source: www.ncdrc.nic.in (As on 01.03.2013)
Cases Cases filed disposed of Cases % o f No. Name of State since since Pending Disposal inception inception 1 Andhra Pradesh 192331 186441 5890 96.94 2 A & N Islands 330 301 29 91.21
3 Arunachal Pradesh 404 338 66 83.66 4 Assam 13704 11976 1728 87.39
5 Bihar 84369 73573 10796 87.2 6 Chandigarh 46795 45614 1181 97.48
7 Chattisgarh 37292 34129 3163 91.52 8 Daman & Diu 162 144 18 88.89
9 Delhi 239215 228875 10340 95.68 10 Goa 6387 5840 547 91.44
11 Gujarat 173597 161750 11847 93.18 12 Haryana 220997 203297 17700 91.99
13 Himachal Pradesh 57043 53672 3371 94.09
14 Jammu & Kashmir 20792 18855 1937 90.68 15 Jharkhand 33985 30720 3265 90.39 16 Karnataka 155588 150723 4865 96.87
17 Kerala 180640 172869 7771 95.7 18 Lakshadweep 75 65 10 86.67 19 Madhya Pradesh 184906 169904 15002 91.89
20 Maharashtra 255993 236744 19249 92.48
21 Manipur 1037 1012 25 97.59
22 Meghalaya 847 750 97 88.55
23 Mizoram 3466 2819 647 81.33 24 Nagaland 290 266 24 91.72
25 Odisha 92978 86305 6673 92.82 26 Puducherry 2907 2714 193 93.36
27 Punjab 154458 148813 5645 96.35
28 Rajasthan 289436 261290 28146 90.28
29 Sikkim 296 280 16 94.59 30 Tamil Nadu 102719 97061 5658 94.49
31 Tripura 2751 2538 213 92.26 32 Uttar Pradesh 565666 490670 74996 86,74
33 Uttarakhand 34759 32598 2161 93.78
34 West Bengal 86109 81310 4799 94.43
TOTAL 3242324 2994256 248068 92.35
208 2. State Commission;
Deals with complaints of amount that exceeds ? 20 lakhs but does not exceed
? 1 crore. It is the next in hierarchy of Consumer Redressal Forums under
Consumer Protection Act. At present there are 35 State Commissions
functioning in India. State Commission consists of a president and two
members. The president is a person who is or has been a judge of a High Court
and two other members, who shall be persons of ability, integrity and standing
and have adequate knowledge or experience of, or have shown capacity in
dealing with problems relating to economics, law, commerce, accountancy,
industry, public affairs or administration, one of w ho m shall be a woman.
The provisions of Section 12, 13, 14 and the rules made there under are
applicable to State Commission also. O n the application of the complainant or
of its own motion, (Under Section 17 and 17A) the State Commission may at
any stage of the proceeding, transfer any complaint pending before the District
F o r u m to another District F o ru m with the State if the interest o f justice so
requires. Any person aggrieved by an order made by the State Commission in
exercise of its powers conferred by sub-clause (i) of clause (a) of section 17
may prefer an appeal against such order to the National Commission within a
period of 30 days if it is satisfied that there was sufficient cause for not filling
it within that period.
3. National Commission;
Deals with the complaints of amount that exceeds ? 1 crore. It is the topmost
layer in the three-level hierarchy of the Consumer Forums. It was constituted
in the year 1988. The National Commission consist a president and four other
members. The president should be the one, who is or has been a judge of the
Supreme Court, and the members should be persons of eminence in economic,
law commerce, accountancy, industry, public affairs or administration. In
order to attain the objects of the C P A , the National Commission has also been
given sufficient powers of administrative control over all the State
209 Commission, by calling for periodical returns regarding the institution,
disposal and pendency of cases. It is empowered to issue instruction regarding,
I. Adoption of uniform procedure in the hearing of the matters.
II. Prior service of copies of documents produced by one party to the
opposite parties.
III. Speedy grant of copies of documents.
IV. Generally overseeing the functioning of the State Commissions or the
District Forums to ensure that the objects and purpose of the Act are
best served.
Following table indicate the status of cases filed or disposed or pending in National
Commission, State Commission and District Forum since its inception.
Table No. 5.2
Current Status for cases filed or disposed or pending
(As on 01.03.2013)
Cases C ases disposed C ases Total N o . Name of Agency filed since o f since P en d in g Disposal inception inception
1 National Commission 80014 6 9 2 5 3 10761 86.55%
2 State Commissions 600097 504834 95263 84.13%
3 District Forums 3242324 2 9 9 4 2 5 6 2 4 8 0 6 8 9 2 . 3 5 %
TOTAL 3922435 3 5 6 8 3 4 3 3 5 4 0 9 2 9 0 . 9 7 % Source: www.ncdrc.nic.in
Consumer Protection Act, 1986 is enacted mainly to protect the interest of consumers.
This act provides security to the consumers from frauds, cheating, getting deceived by the sellers etc... this act stands out to be the important provision in law where consumers disputes can be solved. This act provides base of legal provisions for all other acts w h ic h serves m ainly for the interest o f the consum ers.
S o m e o f the other important acts that provide protection to the consum ers from getting deceived or unfair trade practices o f sellers are:
210 5.4 Sale of Goods Act 1930^ -
This law was originally included under Indian Contract Act 1882 (Section 76 to 123).
But due to ever increasing mercantile transactions, the section 76 to 123 were found inadequate to meet with the required demand. That’s why new Sale of Goods Act was enacted. This Act came into force on the 1*' July, 1930. This Act extends to the whole of India except the State of Jam m u and Kashmir.
The main provisions of this Act are:
Section 5: Contract of Sale
i. A Contract of sale is made by an offer to buy/sell goods for a price and
there should be acceptance of such offer. The contract may provide for the
immediate delivery of the goods or immediate payment of the price of
both, or for the delivery or payment by installments, or that the delivery or
payment or both shall be postponed,
ii. Subject to the provisions of any law for the time being in force, a contract
of sale may be made in writing or by word of mouth, or partly in writing
and partly by word of mouth or may be implied from the conduct of the
parties.
Section 12: Conditions and Warranty
i. A stipulation in a contract of sale with reference to goods which are the
subject thereof m ay be a condition or a warranty.
ii. A condition is a stipulation essential to the main purpose of the contract,
the breach of which gives rise to the right to treat the contract as
repudiated.
iii. A warranty is a stipulation collateral to the main purpose of the contract,
the breach o f w h ic h gives rise to a claim for d a m a g e s but not to a right to
reject the goods and treat the contract as repudiated.
’ Retrieved on 2012, February 19 from http://www.indiankanoon.org/doc/651105 211 iv. 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 31: Duties of Seller and Buyer
It is the duty of the seller to deliver the goods and the buyer to accept and pay for them, in accordance with the terms of the contract of sale.
Section 33: Delivery
Delivery of goods sold may be made by doing anything which the parties agree shall be treated as delivery or which has the effect of putting the goods in the possession of the buyer or of any person authorized to hold them on his behalf.
Apart from the sections m entioned above, this entire act covers u p all the legal aspects o f an contract b etw een buyer and seller. Overall this act provides the base for such transactions where delivery or payment for the goods will be done in near future or as per the convenience o f said parties.
212 5.5 The Essential Commodities Act 1955 -
This Act provides the control of the production, supply, and distribution of, and trade and c o m m e rc e in certain, com m odities in the interests o f general public.
Act covers Essential Commodities as following -
• Cattle fodder, including oilcakes and other concentrates,
• Coal, including coke and other derivatives,
• Components/parts and accessories of automobiles,
• Cotton and w o o le n textiles,
• Drugs as stated under the Drugs and Cosmetics Act, 1940,
• Foodstuffs, including edible oilseeds and oils,
• Iron and steel, including manufactured products o f iron and steel,
• Paper, including newsprint, paperboard and straw board,
• Petroleum and petroleum products,
• R aw cotton, whether ginned or unginned, and cotton seed,
• Raw jute,
• Any other class of commodity which the Central Government may, by notified
order, declare to be an essential commodity for the purposes of this Act,
According to Act, under section 3, if the Central Government is of opinion that it is necessary or expedient to do so for maintaining or increasing supplies of any essential commodity or for securing equitable distribution and availability at fair prices, or for securing any essential commodity for the defense of India or the efficient conduct of military operations it may, by order, provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein. Under section 6 A where any essential commodity is seized by concerned authorities, a report of such seizure shall, without unreasonable delay, be made to the collector of the district. Under section 6B show-cause notice should be send before confiscation of
Essential Commodities. Any person aggrieved by an order of confiscation under
® Retrieved on 2012, March 15 from http://consumeraffairs.nic.in/consumer/sites/default/files/userfiles/ecactl955.pdf. 213 section 6 A may, within one month from the date of the communication to him of such order, appeal to the State Government under section 6C . State Government shall, after giving an opportunity to the appellant to be heard, pass such order as it may think fit, confirming, modifying or annulling the order appealed against.
Section 7 Penalties
If a person contravenes any order made under section 3 -
1. He shall be punishable with imprisonment for a term which may extend to one
year to seven years (in certain cases) and shall also be liable to fine.
2. Any property in respect of which the order has been contravened shall be
forfeited to the Government.
Overall this act covers production, distribution and sale of essential commodities in the market.
214 5.6 The Drugs and Cosmetics Act, 1940^ -
The Act provides constitutional protection for drugs and cosmetics. This act covers
import, manufacturing, sale and distribution of drugs and cosmetics. It provides protection at various steps of production for drugs and cosmetics and also covers the
interest o f general public from getting cheated by the manufacturers or sellers,
following are some of the important provisions of the Act, that provides protection to the consumers from counterfeiting and piracy or where consumers can get cheated by the sellers.
According to Act, section 8, Standards of quality in relation to cosmetics, which the cosmetic complies with such standard as, may be prescribed in the Act. This Act provides special quality check for Import and Manufacturing, sale and distribution of drugs and cosmetics under following sections.
According to section, 9C (for Import of Drugs and Cosmetics) and section 17C (for
Manufacturing, Sale and Distribution of drugs and cosmetics) cosmetics can be
misbranded if-
a. If it contains a color which is not prescribed or
b. If it is not labeled in a prescribed manner or
c. If the label or container or anything accompanying the cosmetics bears any
statement which is false or misleading in any particular.
Section 9 D (for Import of Drugs and Cosmetics) and section 17D (for Manufacturing,
Sale and Distribution of drugs and cosmetics) Spurious Cosmetics are -
a. Such cosmetics that imported under the name of another cosmetics or
b. If it is an imitation of, or is a substitute for, another cosmetics or resembles
another cosmetics in a manner likely to deceive or bears upon it or upon its
label or container the name of another cosmetics, unless it is plainly or
’’ Retrieved on 2012, February 20 from http://www.wipo,int/wipolex/en/text.jsp?file_id= 182378 215 conspicuously marked so as to reveal its true character and its lack of identity
with such other cosmetics or
c. If the label or the container bears the name of company or individual that does
not exist.
Under section 20, the State Government may, by notification in the official Gazette, appoint such a person as it thinks fit, having the prescribed qualification, to be
‘Governm ent Analysts’ for such areas in the state and in respect of such drugs or cosmetics as may be specified in notification. According to section 21 the Central
Government or a State Government may, by notification in the official Gazette, appoint such persons as it thinks fir, having the prescribed qualification to be
Inspectors for such cases as may be assigned to them by the Central Government or
State Government, as the case may be.
Section 22 of the Act, provides special powers to the Inspectors as follows -
a. Inspect -
Any premises wherein any drug or cosmetics is being manufactured and
the means employed for standardizing and testing the drugs or cosmetics.
Any premises wherein any drug or cosmetics is being sold, or stocked or
exhibited or offered for sale or distributed.
b. Take samples of any drugs or cosmetics -
- That is being manufactured or being sold or is stocked or exhibited or
offered for sale or is being distributed, from any person who is in the
course of conveying, delivering or preparing to delivers such drug or
cosmetics to a purchaser or a consignee.
c. At all reasonable times, with such assistance, it any as he considers necessary
Search any person, w h o he believe has is a part o f offence under this act,
- Enter and search any place in which he has reason to believe that an
offence under this act is being committed,
- Stop and search any vehicle, vessel or other conveyance which, he has
reasons to believe, is being used for carrying any drug or cosmetics in
respect o f w h ic h an offence under this act has being committed.
216 Under section 24 persons bound to disclose the place where drugs or cosmetics are manufactured or kept. Under section 26A provided power of Central Government to prohibit m anufacture o f drug and cosmetics in public interest. If the drug or cosmetics are likely to involve any risk to human being or animals or that any drug does not have the therapeutic value claimed or purported to be claimed for certain ingredients and in such quantity for which there is no therapeutic justification then production can be prohibited.
Penalty -
Section 27A -
Covers the penalty for manufacturer, sale of cosmetics in contravention of this Act -
- Any cosmetics deemed to be spurious under section 17C shall be
punishable with imprisonment for a term which may extend three years
and with fine.
- Any cosmetics other than referred above involves in contravention
according to Act, shall be punishable with imprisonment for a term which
may extend to one year or with fine which may extend to one thousand
rupees or both.
Section 28 -
Covers the penalty for non-discloser of the name of the manufacturer -
Whoever contravenes with the provision of section 24 shall be punishable with imprisonment for a term which may extend to one year, or with fine which may extend to one thousand rupees or both.
Section 28A -
Penalty for not keeping documents for non disclosure of information -
Whoever contravenes with the provision shall be punishable with imprisonment for a term which may extend to one year or with fine which may extend to one thousand rupees or with both.
217 Section 28B -
Penalty for manufacture of drugs or cosmetics in contravention of section 2 6 A -
A person who contravention of section 26A shall be punishable with imprisonment for a term which may extend to three years and shall also be liable to fine which may extend five thousand rupees.
Apart from above mentioned clauses, Act cover the interest of general public by prohibiting production on following grounds -
Manufacturing:
Section 144 prohibits manufacturer of cosmetics containing colors other
then those prescribed.
Section 144A prohibits production of those cosmetics that contains
‘Hexachlorophene’ (Because of its toxic effect and ability to penetrate
human skin, “Hexachlorophene” (HCP) may be used only when an
alternative preservative has not been shown to be as effective,
hexachlorophene became suspected of causing cancer, and studies
determined that oral ingestion of hexachlorophene led to weakness and
paralysis on lab tested rats). However “Hexachlorophene” can be used in
soaps but concentrations should not exceed one percent of weight. And
package of each soap should contain the note as - “Contains
Hexachlorophene - not to be used on babies”
- Section 145 prohibits the use of lead and arsenic compounds for the
purpose of coloring cosmetics.
Section 145D prohibits manufacturer of cosmetics containing mercury
c o m p o u n d s .
218 Labeling, Packing and Standards of Cosmetics:
Section 146 prohibits the sell or distribution of cosmetics which are not
manufactured by a licensed manufacturer and labeled and packed in
accordance with the rules.
Section 148 provides exact manner of labeling on packages:
a. O n both the inner and outer labels:
i. The name of the cosmetics.
ii. The name of the manufacturer and complete address of the
premises of manufacturer where cosmetics have been
manufactured.
b. O n the outer label:
A declaration of the net contents expressed in terms of weight for solids, fluid,
measures for liquids, weight for semi solids, combined with numerical count if
the content is sub-dived.
c. O n the inner label, where hazard exists:
i. Adequate direction for safe use,
ii. Any warning, caution or special direction required to be
observed by the consumers,
iii. A statement of the names and quantities of the ingredients those
are hazardous or poisonous.
iv. A n y cosmetics above 10 gram s in solid form and 2 5 milliliters
in liquid form should display a distinctive batch number being
preceded by the letter “ B ” .
v. Manufacturing license number, the number being preceded by
the letter “ M ” .
vi. If package contains only one label, then that label should
contain all the information of inner and outer labels.
219 Section M S A prohibits against altering inscriptions on containers, labels or
wrappers of cosmetics.
Section 149 provides labeling of hair dyes containing Dyes, Colors and
Pigm ents.
Section 14 9A provides special provisions relating to toothpaste containing
fluoride. If fluoride content in tooth paste shall not be more than 1000 ppm
and the contain of fluoride in terms of ppm shall be mentioned on the tube
and carton.
- Section 1 5 0 states that the report o f result o f test or analysis o f cosmetics
should be supplied in Form 34.
Part ID of ‘Drugs and cosmetics Rules, 1945’ provides specific requirements for manufacture of topical products that includes - Creams, Ointments, Pastes,
Emulsions, Lotions, Solutions, Dusting Powders and Identical Products.
1. The entrance to the area where topical products are manufactured shall be
suitable and airlock.
2. The area should have exhaust system which is effective in removing vapors,
s m o k e , floating dust particles.
3. Suitable cleaning equipments and material
4. A separate packing section may be provided for primary packaging of the
products.
Schedule M-II provides basic requirements of factory premises for manufacturer of cosmetics.
(I) General requirement covers - location and surroundings. Buildings, Water supply. Disposal of water. Health, Clothing and sanitary requirements of the staff.
Medical Services etc...
(II) Requirements of Plant and Equipment. - This schedule contains requirements of various plant and their m inim um basic required equipments. Following information
220 covers the requirements for some of the plants or product categories (As mentioned in chapter 2) related with research. Apart from bellow mentioned products, products like
Tooth-paste, Tooth-powder, Toilet soaps etc... are also a part of ‘Drugs and
Cosmetics rules, 1945’.
A . Face powder, cake make-up, compacts, face packs, masks and rouges etc...
E q u ip m en t;
a. Powder mixer of suitable type provided with a dust collector.
b. Perfume and color blender.
c. Sifter with sieves of suitable mesh size.
d. Ball mill or suitable grinder.
e. Trays an d scoops (stainless steel).
f Filling and sealing equipment provided with dust extractor.
g. For compacts :
i) A separate m ixer ii) com pact pressing m achine.
h. Weighing and measuring devices.
i. Storage tank.
An area of 15 square meters is recommended. The section is to be
provided with adequate exhaust fans.
B. Creams, lotions, emulsions, pastes, cleansing milks, shampoos, pomade,
brilliantine, shaving cream s and hair-oils etc.
E q u ip m en t:
a. Mixing and storage tanks of suitable materials.
b. H eating kettle -steam, gas or electrically heated.
c. Suitable agitator.
d. Colloidal mill or homogenizer (wherever necessary).
e. Triple roller mill (wherever necessary).
f. Filling and sealing equipment.
g. Weighing and measuring devices.
A n area of 25 square meters is recommended.
221 C. Nail Polishes and Nail lacquers.
E q u ip m en t:
a. A suitable m ixer.
b. Storage tanks.
c. Filling machine-hand operated or power driven.
d. Weighing and measuring devices.
An area of 15 square meters is recommended. The section shall be
provided with flameproof exhaust system
Premises: There are special requirements for Nail Polishes and Nail lacquers.
a. It shall be situated in an industrial area.
b. It shall be separate from other cosmetic-manufacturing areas by
metal/brick partition up to ceiling.
c. Floors, walls, ceiling and doors shall be fireproof.
d. Smoking, cooking and dwelling shall not be permitted and no naked fame
shall be brought in the premises.
e. All electrical w iring and connections shall be concealed and m ain electric
switch shall be outside the manufacturing area.
f All equipm ents, furniture and light fittings in the section shall be
flameproof.
g. Fire extinguisher likes foam and dry powder and sufficient of buckets
containing sand shall be provided.
h. All doors of the section shall open outwards.
Storage:
All explosive solvents and ingredients shall be stored in metal
cupboards or in a separate enclosed area.
Manufacture:
a. Manufacture of lacquer shall not be undertaken unless the above
conditions are complied with.
b. Workers shall be asked to wear shoes with rubber soles in the section.
Other requirements:
222 N o objection certificate from the local Fire Brigade Authorities shall
be furnished
D . Lipstick and Lip- glossed.
E q u ip m en t:
a. Vertical m ixer.
b. Jacketed kettle- steam, gas or electrically heated
c. M i x i n g vessel (stainless steel).
d. Triple roller mill/Ball mill.
e. M o u l d s w ith refrigeration facility.
f. Weighing and measuring devices.
A n area of 15 square meters is recommended.
E. Preparations used for Eyes: Such preparations shall be manufactured under
strict hygienic conditions to ensure that these are safe for use.
1. Eyebrows, Eyelashes, Eyeliners, etc.
E q u ip m en t:
a. M i x i n g tanks.
b. A suitable mixer.
c. Homogenizer (where necessary).
d. Filling and sealing equipments.
e. Weighing and measuring devices.
A n area of 10 square meters is recommended.
2. Kajal and surma :
E q u ip m en t:
a. B a se sterilizer.
b. P o w d e r sterilizer (dry heat oven).
c. Stainless steel tanks.
d. A suitable Mixer.
e. Stainless steel sieves.
f. Filling and sealing arrangements.
g. Weighing and measuring devices.
h. Homogenizer (where necessary).
223 i. Pestle and mortar (for Surma).
A n area of 10 square meters with a separate area of 5 square meters for
base sterilization is recommended.
a. False ceiling shall be provided wherever required.
b. Manufacturing area shall be made be made fly proof. A n airlock or
an air curtain shall be provided.
c. Base used for Kajal shall be sterilized by heating the base at 150
degree C for required time in separate enclosed area.
d. The Vegetable carbon black powder shall be sterilized in a drying
oven at 120 degree C for required time.
e. All utensils used for manufacture shall be of stainless steel and
shall be washed with detergent water, antiseptic liquid and again
with distilled water.
f. Containers employed for ‘kajal’ shall be cleaned properly with
bactericidal solution and dried.
g. Workers shall put on clean overalls and use hand gloves wherever
necessary.
F. Aerosol.
E quipm ent:
a. Air-compressor
b. Mixing tanks
c. Suitable propellant filling and crimping equipments
d. Liquid filling unit
e. Fire extinguisher
f. Suitable filtration equipm ent
g. Weighing and measuring devices
A n area of 15 square meters is recommended.
- N o Objection Certificate from the Local Fire Brigade Authorities shall be
furnished.
G. Alcoholic Fragrance Solutions
E q u ip m en t:
a. Mixing tanks with stirrer
224 b. Filtering equipment
c. Filling and sealing equipment
d. Weighing and measuring devices
A n area of 15 square meters is recommended.
H. Hair Dyes.
E q u ip m en t:
a. Stainless steel tanks.
b. M ix e r
c. Filling Unit
d. Weighing and measuring devices
e. Masks, gloves and goggles.
A n area of 15 square meters is recommended.
The above mentioned requirements are for basic manufacturing of different categories of cosmetics. It does not include requirements of machinery, equipments and premises required for preparations of containers and closures of different categories of cosmetics. Licensing authority shall have the discretion to examine the suitability and adequacy of the machinery, equipments and premises at the time of requirements of license.
Schedule Q , Part I provides list of Dyes, Colors and Pigments permitted to be used in
Cosmetics and Soaps as given under IS: 4707- 1988 as amended by the Bureau of
Indian Standards.
Schedule S, Section 150-A covers the list of following cosmetics in finished form which shall conform to the Indian Standards Specification laid down from time to time by the Bureaus of Indian Standards (BIS).
Overall ‘The Drugs and Cosmetics Act, 1940’ covers all different types of areas from
Import, Manufacturing, (i.e. production) Sale, Distribution of both Drugs and
Cosmetics in India. This act provides the base for manufacturers and also to consumers about quality of product and consumer safety.
225 5.7 The Prevention of Food Adulteration Act, 1955
Access to the pure, nutritious food, which is free from any type of aduUeration, is the right of every citizen. The Directorate of Prevention of Food AduUeration is responsible for checking adulteration or misbranding of food commodities. The
Prevention of Food Adulteration Act was enacted in 1954 to strengthen the system for preventing food adulteration. The Act came into effect from 1*‘ June, 1955.
The central Government or the State Government may, by notification in the Official
Gazette, appoint such persons having the prescribed qualifications to be public analysts for such local area as m ay be assigned to them by the Central Government or the State Government as the case required. Different public analysts m ay be appointed for different articles o f food.
The Central Government or the State Government may, by notification in the Official
Gazette, appoint such persons having the prescribed qualifications to be Food
Inspectors for such local areas as m ay be assigned to them.
• Powers of Food Inspectors :
1. H e can take sam ples o f any article o f food from - any persons selling
such article, or any person w h o is in the course o f conveying, delivering or
preparing to deliver such article to a purchaser.
2. Send such sample for analysis to the public Analyst for local area
within which such sample has been taken.
3. With the approval of Food or Health Authority he can prohibit the sale
o f any article o f food in the interest o f the public health.
4. Any Food Inspector may enter and inspect any place where any article
of food is manufactured, or stored for sale, or stored for the manufacture of
any other article o f food for sale.
226 There are four central food laboratories have been established under the Act, which work as appellate laboratories for the purpose of analysis of appeal samples of food articles lifted b y the F o o d Inspectors o f States. Th ese laboratories are -
1. Food Research and Standardization Laboratory. - Ghaziabad
2. Central Food Laboratory. - Calcutta
3. Central Food Laboratory. - Pune
4. Central Food Laboratory. - Mysore
A very unique act in its type provides protection to the consumers from adulteration of food. The makes sure that every citizen should have the supply of good quality, pure and nutritious food. This act is very useful in keeping check on producers those w ho use low quality raw material to earn excess profit. 5.8 The Designs Act, 2000*
The Act came into force on 12"’ May 2000 (Published in Gazette). This act is associated with the physical characteristics of goods that can be considered as its design.
According to Act, Section 2(d) ‘Design’ means only the features of shape, configuration, pattern, ornament or composition of lines or colors applied to any article whether in two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate or combined, which in the finished article appeal to and are judged solely by the eye; but does not include any mode or principle of construction or anything which is in substance a mere mechanical device, and does not include any trade mark as defined in clause (v) of sub-section (1) of section 2 of the Trade and Merchandise Marks Act,
1958 or property mark as defined in section 479 of the Indian Penal Code or any artistic work as defined in clause (c) of section 2 of the Copyright Act, 1957
A cc o rdin g to A ct, the go o ds or its design that falls under any on e category m entioned below then registration of that design is prohibited under the Act.
A design which a. is not new or original, b. has been disclosed to the public anywhere in India or in any other country by
publication in tangible form or by use or in any other way prior to the filing
date, or where applicable, the priority date of the application for registration, c. is not significantly distinguishable from known designs orcombination of
known designs, d. comprises or contains scandalous or obscene matter shall not be registered.
The Controller General of Patents, Designs and Trade Marks appointed under sub section (1) of section 4 of the Trade and Merchandise Marks Act, 1958 shall be the
Controller o f D e s ig n s for the purposes o f this Act. T h e controller shall grant the certificate of registration to the proprietor of design when registered. The Proprietor
® The Design Act 2000. 228 will have the copyright of the design for the period of Ten years which can be further
extended for five more years after fulfillment of official requirements.
Piracy of registered design within the copyright period -
(a) For the purpose of sale to apply or cause to be applied to any article in any
class of articles in which the design is registered, the design or any fraudulent
or obvious imitation
(b) To import for the purposes of sale, without the consent of the registered
proprietor,
(c) Knowing that the design or any fraudulent or obvious imitation thereof has
b een applied to any article in any class o f articles in w h ic h the design is
registered without the consent of the registered proprietor,
If any person acts in contravention of this section, he shall be liable for every
contravention-
(a) To pay to the registered proprietor of the design a sum not exceeding twenty-
five thousand rupees recoverable as a contract debt, or
(b) If the proprietor elects to bring a suit for the recovery of damages for any such
contravention, to pay such damages as may be awarded and to be restrained by
injunction accordingly: Provided that the total sum recoverable, in respect of
any o n e design under clause, shall not exceed fifty thousand rupees: Provided
further that no suit or any other proceeding for relief under this subsection
shall be instituted in any court below the court of District Judge.
If the said designed is rejected by the controller, appeal declared by this Act lie from controller to the High Court. The appeal shall be made within Three months from the date of order passed by the controller.
229 5.9 Intellectual Property
The existing nature of Human Rights is based on various types of International treaties and conventions. T R I P S agreement is also one o f part o f it. Before W T O , the last few years, the United States and various European countries, have pushed to incorporate uniform protections o f Intellectual property rights into the structure o f the global trading system.
This initiative b eg an w ith T R I P S A g re em en t formulated in the U r u g u a y R o u n d in
1994, during the formation of the World Trade Organization. It has been continued through a series o f bilateral free-trade agreements including additional (T R I P s -plus) provisions, that enable patent holders to extend their monopoly beyond the twenty years allowed in the TRIPs Agreement. It is adopted by all W T O members with interest in protecting copyrights, patents and trademarks. It is linked to W T O dispute settlement system.
Intellectual property protects applications of ideas and information that have commercial value. One of fundamental similarity among various types of Intellectual
Property Rights is its ‘Negative’ nature. These rights stops others doing things such as rights in other words to stop pirates, counterfeiters, imitators and even in some cases third parties who have independently reached the same ideas, from exploiting them without the license of the right owner.
Apart from this shared characteristic, the three central types of Intellectual Property
Rights - Patents for Inventions, Copyrights for literary and artistic w orks and associated products and Trade Marks and names for the goodwill attaching to marketing symbols cover distinct subject matter and have different objectives.
However these property rights protect one’s right from getting violated or used by the others.
230 • Patents-
Patents are granted in respect of inventions. According to ‘Manual of Patent Office -
Practice and Procedure’ modified on 22"^’ March 2011^,
According to Section 2(1) j “Invention” means a new product or process
involving an inventive step and capable of industrial application.
Section 2(1) j a “Inventive step” means a feature of an invention that
involves technical advance as compared to existing knowledge or having
economic significance or both and that makes the invention not obvious to
a person skilled in the art.
A patent is a right approved by national government to an inventor or their assignee
for a limited period of time. The term patent usually refers to a right granted to anyone who invents or discovers any new and useful process, machine, article of
manufacture or composition of matter, or any new and practical improvement thereof
The procedure for granting patents, the supplies placed on the patentee, and the extent of the restricted rights vary widely stuck between countries according to national laws
and international agreements.
Benefits of Patent
Patenting creation allows, once to avert others from making, using or selling
invention. A patent can also help to increase the worth of business because it is
measured as valuable asset by banks and potential purchaser. There are many ways to
financially benefits from a patent. A patent can be sold in absolute w ay to anybody for
monetary remuneration. O ne can also license his/her patent to one or more parties for a percentage of the sale price. A patent gives you the right to stop others from copying, manufacturing, selling, and importing creation without inventor’s permission. It also gives inventor’s legal right to take action to stop others exploiting
innovation and to claim damages.
Patent protection secures the legal authority of the patent holder over the registered invention or patent, provides certain due and exclusive rights to the patent owner
' Retrieved on 2013, June 16 from http://ipindia.nic.in/ipr/patent/patactl970-3-99.html. 231 regarding the personal and commercial uses and trading of the patent, and full legal
rights to sue against the patent infringers and thus get compensation for the losses and
dam ag es caused b y the infringing activities.
According to recommendations of TR IPS Agreement'®, the patent protection period in
most of the domestic and International Jurisdictions, has been set to Twenty Years
for inventions and patents in most of the economic fields. This patent protection
period generally starts from the date of filing the patent application and its further
expandable through patent renewals. In India, patent registration and protection is
provided under the Patents Act, 1970, which is now in close agreement with the
TRIPS Agreement, after amendment in it in the year 2005. Since 2005, the patent
protection period in India for patents in all commercial and industrial fields, including
the field of pharmaceuticals, has been extended to Twenty Years, from the date of
registration of the patent. Again, this patent protection in India is available for
inventions or patents regarding both products and processes in these economic fields.
Every country has ^ferent law for patent registration. The Patent Act 1970 sets the
rules and regulation to register a patent in India. This registration of a patent can be
filed by an individual or jointly with partner or by legal representative. Patent agents
are also available on fixed charges. Patent registration offices are established under
the ministry of commerce and industry, department of industrial policy and
promotion, which are available to guide and advise the applicant.
Patent Infringement
Without an authorizing permission of patent holder, any type of infringing upon the
legitimate rights of the patent holder is known as Patent Infringement. A n patent
holder enjoys the sole rights of personal and commercial use of his patented
innovation. There are Domestic as well as International laws for patent infringement.
In India, patent infringement is covered under the ‘Patent Act 1970’ and ‘Patent Rules
1972’. At International level, the most recognized and effective patent infringement
laws are governed and supervised by authorities like W T O through TRIPS
Comish, W and Lewelyn, D (2003). Intellectual Property: Patents, Copyright, Trade-Marks and Allied Rights, Sweet and Maxwell publication, London. 232 Agreement, the World Intellectual Property Organization (W IP O ), Berne of Paris
Convention, and the European Patent Office.
In India, at any point of time if patentee finds that his rights has been infringed by third party, then matter can be settle on understanding by providing license for specific period of time with the consent of patent holders. But if the infringement continued, the patentee can file a law suit against the infringer. The Indian Limitations
Act governs the period of limitation for bringing a suit for infringement of patent, which is 3 years from the infringing takes place and not from the date of the grant.
District court of respected geographical area has the legal authority to hear and determine causes of action.
Infringement can take place in form of -
1. Imitation o f an invention with slight change in color.
2. Mechanical changes in invention which would lead to the same outcome or
result as obtained by the patentee.
3. Variation in the inventions.
4. Using some key features of the inventions.
Even if the term of the patent has expired and infringement takes place, a legal suit can be instituted e ven after the expiry o f the term.
Various sections of Indian Patents Act, 1970" -
Section 104 - A suit of infringement has to be filed in a District court.
Section 105 - Power of court to make declaration as to non-infringement.
Section 106 - Power of court to grant relief in cases of groundless threats of
infringement proceedings.
Section 107 - Defenses in suits for infringement is available under section 47 and
section 64.
Section 107A - There are also certain acts which do not amount to infringement which includes: any act of making construction, using, selling or importing a patented
" Retrieved on 2012, December 30 from http;//www.mightylaws.in/758/patent-infringement-part l-II.
233 invention solely for was reasonably related to the development and submission of information required under any law in India or in any other country that regulates the making, constructing, using, selling or importing. Importation of patented products by any person from a person who is duly authorized under the law to produce and sell or distribute the products is not to be considered as infringement of patent rights.
Section 1 0 8 - Reliefs in suits for infringement.
Section 109 - Right of exclusive licensee to take proceedings against infringement.
Following table indicates the current status (Till 2012) of countries according to number of patent applications and granted patents.
Table No. 5.3
List of Countries According to Patent Applied and Granted
(Till 2012)
Nam e of Country Patent Patent
(Not in Ranking Order) Applications Granted
Japan 472,417 2 3 8 ,3 2 3
China 435,608 1 7 2 ,1 1 3
U S A 4 3 2 ,2 9 8 2 2 4 ,5 0 5
G e r m a n y 1 7 2 ,7 6 4 1 1 ,7 1 9
France 6 5 ,3 4 9 1 0 ,2 1 3
UK 49,938 7,173
Russia 3 1 ,4 3 3 2 9 ,9 9 9
Italy 27,679 6,380
C a n a d a 2 4 ,5 2 8 2 0 ,7 6 2
India 15,717 5 ,1 6 8
Source: http://en.wikipedia.org/wiki/List_of_countries_by_patents
There have been changes in patent laws all over the world in recent times. Not only the number or types of patents claimed has increased during last decade, but the process of claiming them has also gone through considerable changes. Ever-changing technological up gradation might bring more challenges towards patentees in near future.
234 • Copyrights’^ -
The Copyright Act, 1957 came into effect from January 1958. This Act has been amended five times since then, i.e., in 1983, 1984, 1992, 1994 and 1999, with the
amendment of 1994 being the important one. Prior to the Act of 1957, the Law of
Copyrights in the country was governed by the Copyright Act of 1914. This Act was
essentially the extension of the British Copyright Act, 1911 to India.
Copyright is the right given against the copying of defined types cultural,
informational, and entertainment productions. These are the rights given by the law to creators of literary, dramatic, musical and artistic works and producers of
cinematograph films and sound recordings. It covers the rights of reproduction, communication to the public, adaptation and translation of the work etc... The
Copyright A ct, 1 9 5 7 protects original literary, dramatic, m usical and artistic w orks
and cinematograph films and sound recordings from unauthorized uses. In India
Copyright covers following works:
1. Original literary, dramatic, musical and artistic w orks.
2. Cinematograph films,
3. Sound recording.
Rights in case of Literary Work: (Except Computer Programme)
• To reproduce the work
• To issue copies of the work to the public
• To perform the work in public
• To communicate the work to the public
• To make any translation of the work
• To make any adaptation of the work.
Rights in case of Dramatic Work:
• To reproduce the work
• To communicate the work to the public or perform the work in public
• To issue copies of the work to the public
'■ Retrieved on 2013, April 20 from http://copyright.gov.in/Documents/handbook.html 235 • To include the work in any cinematograph film
• To make any adaptation of the work
• To make translation of the work
Rights for Artistic work:
• To reproduce the work
• To communicate the work to the public
• To issue copies of the work to the public
• To include the work in any cinematograph film
• To make any adaptation of the work
Rights in Musical work:
• To reproduce the work
• To issue copies of the work to the public
• To perform the work in public
• To Communicate work to public
• To make translation of the work
• To make any adaptation of the work
Rights in a Cinematograph films:
• To make a copy of the film including a photograph of any image forming part
there of,
• To sell or give on hire or offer for sale or hire a copy of the film
• To communicate the cinematograph film to the public
Rights in Sound Recordings:
• To make any other sound recording embodying it
• To sell or give on hire, or offer for sale or hire, any copy of the sound
recording
• To communicate the sound recording to the public.
The Act provides the right of reproduction to the copyright owner. Under which no person shall make one or more copies of a work or any part of it in any material form
236 including sound and film recording without the permission of right owner. This right
is generally being enjoyed b y the re-printing o f editions o f w ork .
Procedure for registration of work under the Copyright Act -
Copyright Rules, 1956, chapter VI provides guidelines about the procedure of registration of work under the Act. It covers following things -
1. Application for registration is to be made on form IV as prescribed in the first
schedule of the Rules.
2. Separate applications should me made for registration of each work.
3. Every application should accompany with the required fee prescribed in the
second schedule of the Rules.
4. The application should be signed by the applicant or a person in whose favor a
Power of Attorney has been executed.
5. Three copies of the published work may be sent along with the application.
6. A copy of manuscript has to be sent along with the application for affixing the
stamp of the copyright office in proof of the work having been registered. (If
work is unpublished)
The Copyright Board consisting of a Chairman and two or more, but not exceeding
fourteen, other members for adjudicating certain kinds of copyright cases. The
chairman of the Board is of the level of a judge of a High Court.
Following are some of the commonly known acts involving infringement of copyright
M aking infringing copies for sale or hire or selling them for hire,
- Permitting any place for the performance of works in public where such
performance constitutes infringement of copyright.
Distributing infringing copies for the purpose of trade or to such an extent
so as to affect prejudicially the interest o f the o w n e r o f copyright.
- Public exhibition of infringing copies that includes trade,
- Import of infringing copies into India.
237 Any person who knowingly infringes the copyright in any work should be considered as criminal offence under Section 63 of Act. A Copyright owner can take legal action against any person w ho infringes the copyright. The District Court has the jurisdiction power in civil suits regarding copyright infringement.
The minimum punishment for infringement of copyright is imprisonment of Six months with the minimum fine of Rs. 50000/- In the case of a second and subsequent conviction the m inimum punishment is imprisonment for one year and fine of Rs. One
L a k h .
Trade M ark (Trademark or Trade-mark)
Trade mark is a symbol, work or series of work legally registered for a company or an product. It is a recognizable sign, symbol, design or expression which identifies product or company. The owner of trade mark can be an individual person or an organization. Essential role of Trademark is to create an identity of a product which will help in identifying the origin of product or services.
There are two basic symbols are associated with trade marks as -
The Trademark Symbol - (It can be used by any common law usage of a mark)
The Registered Trademark Symbol - ® (It may only be used by the owner of a mark following registration with national authority)
The Service Mark - (It is mainly used in U.S to identify service rather than a product)
The proper manner to display either symbol is immediately following the make in superscript style.
The Trade Marks Registry was established in India in 1940 and presently it administers the Trade Marks Act, 1999 and the rules there under. The objectives of the Trade mark Act, is to register trade marks applied for in the country and to provide for better protection of trademark for goods and services and also to prevent
Retrieved on 2013, January 04 from http://ipindia.nic.in/tmr_new/default.htm 238 fraudulent use of the mark. The main function of it is to register Trade Marks which qualifies for registration under the Act and Rules.
Conditional pre-requisites -
• If it is a word mark, or if it is a mark containing at least in part a word, then
that w o r d ought to be easy to speak, spell and re m e m ber
• Invented word or coined words that cannot be found in dictionary as such
form the best trade marks of all, since they can seldom be used as a generic
word for any purpose
• One should always be careful to avoid selection of a geographical name
precisely for the same reason
Marks that can be adopted as trade mark -
• Any name (including personal or surname of the applicant or predecessor in
business or the signature of the person), which is not unusual for related trade
to adopt as a mark.
• An invented word or any arbitrary dictionary word or words, not being
directly descriptive o f the character or quality of the goods/service
• Letters or numerals or any combination thereof.
• Devices, including fancy devices or symbols
• Monograms
• Combination of colors or even a single color in combination with a word or
device. ^
• Sh ap e o f goods or their packaging
• Marks constituting a 3-dimensional sign.
• Sound marks when represented in conventional notation or described in words
by being graphically represented.
• All of the aforesaid marks have to be sufficient for the purpose of
identification of and distinguishing the goods, in relation to which they are
being used, from other goods.
239 Types of trade marks -
• Product trademarks associated with particular goods
• Service trademarks associated with a particular kind of service such as
insurance, building construction etc.
The Fourth Schedule of Trade Mark Rules, 2002 provides a comprehensive classification of different types of trade marks associated with different goods and services that can be registered in India. T h e right to use a m ark can be exercised either by the registered proprietor or a registered user or anybody else who has been duly authorized by the registered proprietor or a registered user.
Legal requirements -
• The selected mark should be capable of being represented graphically (that is
in the paper from)
• It should be capable of distinguishing the goods or services of one undertaking
in relation to which it is being used from those of others
• It should be used or proposed to be used in relation to goods or services for the
purpose of indicating a connection in the course to trade between the goods or
services and some person having the right to use the mark with or without
revealing identity o f that person.
Duration of trade mark protection available in India -
• Term of registration of a trademark is ten years, which may be renewed for a
further period of ten years on payment of prescribed renewal fees.
• However, non-usage of a registered trademark for a continuous period of five
years is a valid ground for cancellation of registration of such trademark at the
behest of any aggrieved party.
The procedural forms for major trademark transaction -
• For filing new application- There are prescribed forms depending on the
nature of application such as Form TM-1, TM-2, TM-8, TM-51 etc...
• To file a Notice of Opposition to oppose an application published in Trade
Marks Journal - Form TM-5
240 • For Renewal of a Regd.Trademark - From TM-12
• Surcharge for belated renewal - Form-10
• Restoration of removed mark - Form TM- 13
• Application for rectification of registered trade mark - Form TM- 26
• Legal Certificate- F o r m T M - 4 6
• Official search request for trademark- Form TM-54
• Preliminary advice of the Registrar as to the registrability of mark - Form
T M - 5 5
• Copyright search request and issuance of certificate - Form TM-60
Steps for registration of a trademark -
• The first step I conducting a trademark search so as to ensure that the logo or
name in respect of which you intend to register a trademark is not identical to
an existing logo or name.
• A trademark can be revoked even after it is granted, if somebody successfully
challenges it on the ground that it is confusingly similar to an already
registered trademark. It is advisable to hire a trademark attorney with some
experience for conducting the search, in order to ensure that your business
logo or name is not confusingly similar to an already registered trademark.
This will minimize chance of your trademark being revoked subsequently,
after it has b een granted.
• Next, the trademark application in prescribed format under the Trademarks
Rules needs to be m a d e to the Tradem ark Registry.
Trade mark registry address for M um bai region -
Trade Mark Registry Mumbai
Intellectual Property Office,
Antop Hill Post Office,
S . M . R o a d
Antop Hill,
Mumbai -400 037
Jurisdiction - Maharashtra, Madhya Pradesh and Goa
241 • The application must be made in respect of one or more of the various
categories of goods and services as classified under Schedule IV of the Trade
Marks Rules, 2002 of the application is in respect of one class, the is IN R
3500. However, if the application is in multiple classes, it is more expensive,
the fee being IN R 3500 multiplied by the number of classes. Hence, one must
identify the category/ categories under which you wand to apply.
• The application must be filed by the applicant or his agent. The agent must be
legal practitioner or a person registered as a trademarks agent.
• After the application has been filed, the Trademarks Registry shall search
whether an identical mark or a mark which is deceptively similar to the mark
applied for, already exists, in respect of the same goods and services or similar
goods and services.
• The trademark is valid for ten years, but may be renewed afterword (Renewal
fees typically range between IN R 2500 to IN R 5000, except for certification
m arks.)
Other aspirants*'* -
These three types of intellectual property may be regarded as setting the models to which aspirants will turn for the protection of other ideas, information and “trade values”. Throughout the period of industrialization there have been claimants who seek either to fit a new subject-matter within one of the model systems or else to have anew regime created to protect it.
(a) Industrial designs
A n Industrial design is an Intellectual Property right that protects the visual
design of objects. Industrial design consist creation of a shape, configuration
or composition of pattern or color, or combination of pattern and color. It can
be two dimensional or three dimensional depending upon the pattern used by
the producers. In India, India’s Design Act, 2000 was enacted to consolidate
14 Cornish, W and Lewelyn, D (2003). Intellectual Property: Patents, Copyright, Trade-Marks and Allied Rights, Sweet and Maxwell publication, London.
949 and amend the law relating to protection of design. The new act defines
‘Design’ as only physical features of shape, pattern, configuration, ornament,
or com position o f lines or color applied to any product or article whether in
two or three dimensional or in both forms. Many countries have a design
registration system, but they differ in the extent to which the right granted is
akin to patent protection or to copyright. Som e use artistic copyright itself to
give protection of the designs of industrial products, often with some
modification fits scope.
(b) Trade secrets and other confidential information
A Trade Secret (Know-how) or Undisclosed Information is any information
that has been intentionally kept as secret. It generally includes technical data,
internal processes, methodologies, survey methods, a new invention for which
a patent application has not yet been filed, list of customers, process of
manufacturing, techniques, formulas, drawings, code numbers etc... It protects
information that confers a competitive advantage to those w ho not possess this
information. In India, there is no specific legislation regulating the protection
of trade secrets in India. India follows common law approach of protection
and all matters relating to it are generally covered under the Contract Act,
1 8 7 2 .
Following are the legislation which have a connection with the trade secrets -
1. Copyright Act, 1957 (Section 51, 55 and 69)
2. The Design Act, 2000
3. The Information Technology Act, 2000 (Section 65, 72)
4. Indian Penal Code (Section 408,415)
5. The Indian Contract Act (Section 27)
6. The Competition Act, 2002 (Section 3)
7. Civil Procedure Code
8. Criminal Procedure Code
243 Conclusion:
Intellectual Property contributes very heavily to our economies. M any industries across the nations rely on the adequate enforcement of their patents, trademarks and copyrights where consumers those who are going to purchase their commodities will be safe and satisfied. It is also very useful in protecting innovations and motivating new inventors by providing them guarantee and security about their inventions. Even though the nature o f obtaining intellectual property is a bit co m p le x, the k n o w le d g e o f
IP is essential for every individual.
244 5.10 Certification Marks in India -
As a consumer very often we seem to rely on the mercy of shopkeepers and manufacturers for all type of purchase information. It is often experienced that, shopkeepers often talk positively about their product and usually ends up selling the product they want to sell rather than the product a consumer wants to buy.
Authenticity of products that consumers buy can be questioned if they rely mainly on the information sellers or shopkeeper provides them. Discrimination on price is the most usual practice of many sellers. However, some sort of basic knowledge about certification marks could help consumers to buy not only genuine product but it will also provide guarantee about price of the product. India practices product certification system governed by the law of Indian Parliament. Some these marks are mandatory for so m e product w hile others hold m ainly advisory status. All the industrial standardization and industrial product certification is governed by “ Bureau of Indian
Standards”, “The National Standards Organization” and some other governmental agencies.
• State Enforced Certification Marks -
1. I S I M a r k '^ :
ISI M a r k
IS XXXX
CM/L- XXXXXXX
It is a standardization mark effective since 1955, issued by the Bureau of
Indian Standards ( B I S ) to certify that the product conform the m i n im u m
quality standards. It is mainly industrial product certification mark in India.
Retrieved on 2012, December 14 from Bureau of Indian Standards. Official web site. 'Product Certification Schemes
245 The name ISI is an abbreviation of ‘Indian Standards Institute’. ISI mark is
m andatory for certain products to be sold in India, like m a n y o f the electrical
appliances and other products like L P G valves, L P G cylinders, automotive
tyres etc. But in many other cases it is voluntary. For original ISI mark it is
mandatory that 7 digit license number required by BIS and IS number should
be printed on top of the ISI mark which signifies the number of the Indian
Standard for the particular product. Use of fake ISI mark is punishable by law.
2. FPOMark'^-
F P O M a r k
“Food Product Order” Mark is mandatory on all processed fruit products sold
across the country under the Food Safety and Standards Act of 2006. It
includes packaged fruit beverages like fruit jams, crushes and squashes,
pickles, dehydrated fruit products and fruit extracts. This mark guarantees that
the product is m anufactured in a safe environm ent that ensures that product is
safe for consum ption. T h e F P O license is, necessary to start a fruit processing
industry in India.
16Retrieved on 2013, January 04 from http://mofpi.nic.in
246 3. AGMARK*’ -
AGMARK
The term A G M A R K came by joining the words ‘A g’ for Agriculture and
‘mark’ for certification marks. This term was originally introduced in the bill
presented in the parliament of India for the Agricultural Product (Grading and
Marketing) Act. A G M A R K is a certification mark on agricultural products in
India. The current A G M A R K standards in India covers quality guidelines for
205 different commodities which includes pulses, cereals, essential oils,
vegetable oils, semi processed products etc... A G M A R K certification is
practiced in 11 regional laboratories situated in M um bai, N e w Delhi, Chennai,
Kolkata, Kanpur, Kochi, Guntur, Amritsar, Jaipur, Rajkot and Bhopal.
4. NON POLLUTING VEHICLE MARK'* -
NON POLLUTING VEHICLES
The Non Polluting Vehicle mark is another mandatory certification mark
required on all automobiles sold in India. This mark certifies that the motor
vehicle conforms to the relevant version of the Bharat Stage Emission
Retrieved on 2013, January 06 http://agmarknet.nic.in/agm_stdl.htm
'* Retrieved on 2013, January 06 from http.7/cpcbenvis.nic.in/newsletter/Inspection/ch60503.htm
247 Standards. For n e w vehicle certificate is valid for one year from the date o f
sale o f the vehicle, but after this the vehicle has to be tested afresh in local
testing franchisee to obtain P U C - Pollution U n d e r Control certificate.
5. BIS Hallmark
»:Ct:4C Bureau of Indian Standards
This Hallmark system for Gold and Silver jewellery sold in India covers the
certificate o f purity o f metal. Th is system o f H allm arking has started in India
since 2000 for Gold and in 2005 for Silver. The B IS Precious Metals Sectional
Committee (M T D 10) has formulated and published the following Indian
Standards on Gold^° -
A . IS 1417 - Grades of gold and gold alloys.
B. IS 1418 - Assaying of Gold in Gold Bullion, Gold alloys and Gold
Jewellery.
C. IS 2790 - Guidelines for manufacture of 23, 22, 21, 18, 14 and 9 carat
gold.
D . IS 3095 - Gold solders for use in manufacture of jewellery.
E. IS 2112 - The standard specification for ‘Hallmarking of Silver Jewellery’
” Retrieved on 2013, January 05 from http://en.wikipedia.org/wiki/BIS_hallmark
Available from http://www.bis.org.in/cert/hallmark.htm
248 6. Indian Organic Certification Mark
Indian Organic is a Certification mark for food products manufactured in
India. Th is certification m ark certifies that an organic food product conform s
to the National Standards for Organic Product established in 2000. These
standards ensure that the product or the raw materials used in the product were
g r o w n w ith organic farm ing and without the use o f fertilizers, pesticides or
other chemicals. The certification scheme and marking has came into
existence in 2002.
7, ECO-MARK-
Eco mark is a certification issued by Bureau of Indian Standard for eco-
friendly products. Products that conform to the standard set b y B I S for
environmental protection are permitted eco-labeling of their products. This
m arking sc hem e w a s started in 1 9 9 1 . O n e o f the m a in purpose o f the m ark is
increasing awareness among the consumers towards reducing environment
^‘Retrieved on 2013, January 05 from http://www.apeda.gov.in/apedawebsite/organic/Organic_Products.htm
249 impact. The products where eco-mark can be found are paper, packaging materials, textiles, detergents etc...
Other Marks -
1. Vegetarian Mark -
These marks are used to indicate the presence of vegetarian ingredients in
processed food items. A small green circle inside a square on the package
of some products like bread, milk powder, honey, spices etc... symbolizes
that it is m a d e up with vegetarian ingredients.
2. Non-Vegetarian Mark -
The red circle inside a square on food items that contains non-vegetarian
ingredients indicates non vegetarian products. The Government of India
has made it mandatory for all packages of processed food items to bear the
Vegetarian or non-vegetarian mark.
250 3. Toxicity Labels^^ -
Toxicity labels with red label, yellow label, blue label and green label are
mandatory labels for pesticide containers in India which signifies level of
toxicity of the contained pesticide. The labeling scheme proposes four
different colors that represent toxicity as follows.
Name Level of Toxicity
R e d Label Extremely Toxic
Yellow Label Highly Toxic
B lu e Label Moderately Toxic
Green Label Slightly Toxic
22 Retrieved on 2013, January 10 from http;//en.wikipedia.org/wiki/Toxicity_labei
251 Non- Statutory Marks -
T h e s e m arks d o not have any statutory status, but still they help in guiding
consumers about quality of the product. With the development in
technological sectors, methods used by producers to protect their brands from
duplication are increasing. To name few of them -
1. Silk M a r k
Silk Mark is a quality assurance label for the assurance of pure silk and in
addition serves as a brand for generic promotion of pure silk. It is a
registered Trade Mark. And it can be used in all silk products like dress
materials, garments, carpets, sarees etc... The certification is managed by
the ‘Silk Mark Organization of India, a society setup by the state
controlled Central silk Board of India. This mark is only of advisory nature
and not legally endorsed yet.
2. Wool Mark-
23 Silk mark of Organisation of India
252 It is a certification mark that appears on woolen garments that use pure
quality wool. This standard for woolen products is prescribed by the
International W o o l Secretariat.
3. Bar-Code & Q R Code
x x x x x x x x
Bar Codes are a set of parallel vertical line (combination of bars and
space) that can be read by specific scanners. It consists of a particular
numbers of bars of different width along with the number. It is used
worldwide as part of product packages, as price tags, carton labels and
even in credit card bill it is easily readable by scanners. It facilitates unique
product identification through using international numbering system,
promotes brand image and help in identification of product also. Even
though till date, this system is not mandatory on producers, Government of
India provides financial assistance to all micro and small manufacturing
enterprises to adopted bar code certificates.
Q R codes or Quick Response codes are the most popular types of barcodes
today. T h e s e codes started o ff in Japan in 1 9 9 4 and m a k in g progress into
other western national since. A Q R code contains an U R L, text or any
Retrieved on 2013, January 15 from http://dcmsme.gov.in/emerge/barcoding/overview.htm
253 other type of data. It can be read by devices which have a camera and a
barcode scanner or reader. Almost all smart phones these days can read
Q R code and help user to access or read the data. Due to its easy
accessibility these codes very popular am ong new generations.
4. Hologram Stickers -
Hologram stickers are specially designed labels with 2 dimensional or 3
dimensional (2D or 3D ) images. Such stickers are used for security or
verification purpose. Manufacturing of holographic sticker is very
technical process. Any type of image, number, text or photo can be used
for hologram sticker. Forgery of hologram is very difficult because it
required expensive machinery that would give 2D or 3D effect to the
stickers. Som e of the holographic stickers are highly sensitive that once
they can get easily damaged if someone tries to remove them. Many
producers prefer these highly sensitive holographic stickers for their
product from being getting copied.
These all above mentioned standardization marks provides guideline to the consumers about originality of a product. But it is the consumer w ho makes the final call about his consumption. It is his decision that matters for what he is going to consume at that point of time. Governments, organizations, individual producers can only try to minimize chances of getting beaten by these fake sellers. W h en all the guidelines are available about consumer safety it’s up to consumer to become wise in choosing original product.
Conclusion:
Overall this chapter provides information about constitutional provisions against counterfeiting and piracy. A s till date there is no separate law or act is in existence, this chapter discusses different those laws together where there is a provision related with the counterfeiting and piracy or infringement of intellectual property rights.
254