Chapter V - Assignment and Transmission
Section 40
Section 40: Transfers creating multiple exclusive rights
A transfer is restricted where it would create multiple confusing exclusive rights in identical or nearly resembling marks.
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This article is for general information. Refer to the Trade Marks Act, 1999 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) Notwithstanding anything in sections 38 and 39, a trade mark shall not be assignable or transmissible in a case in which as a result of the assignment or transmission there would in the circumstances subsist, whether under this Act or any other law, exclusive rights in more than one of the persons concerned to the use, in relation to—
(a) same goods or services;
(b) same description of goods or services;
(c) goods or services or description of goods or services which are associated with each other, of trade marks nearly resembling each other or of identical trade mark, if having regard to the similarity of the goods and services and to the similarity of the trade marks, the use of the trade marks in exercise of those rights would be likely to deceive or cause confusion:
Provided that an assignment or transmission shall not be deemed to be invalid under this sub-section if the exclusive rights subsisting as a result thereof in the persons concerned respectively are, having regard to limitations imposed thereon, such as not to be exercisable by two or more of those persons in relation to goods to be sold, or otherwise traded in, within India otherwise than for export therefrom, or in relation to goods to be exported to the same market outside India or in relation to services for use at any place in India or any place outside India in relation to services available for acceptance in India.
(2) The proprietor of a registered trade mark who proposes to assign it may submit to the Registrar in the prescribed manner a statement of case setting out the circumstances and the Registrar may issue to him a certificate stating whether, having regard to the similarity of the goods or services and of the trade marks referred to in the case, the proposed assignment would or would not be invalid under sub-section (1), and a certificate so issued shall, subject to appeal and unless it is shown that the certificate was obtained by fraud or misrepresentation, be conclusive as to the validity or invalidity under sub-section (1) of the assignment in so far as such validity or invalidity depends upon the facts set out in the case, but, as regards a certificate in favour of validity, only if application for the registration under section 45 of the title of the person becoming entitled is made within six months from the date on which the certificate is issued.
Rule and business relevance
The rule covers the stated same, similar-description or associated goods and services relationships. The proviso recognises specified limitations preventing overlapping exercise. A proposed registered-mark assignment can be put to the Registrar for the certificate described in subsection (2).
Limits and related provisions
The certificate is subject to appeal and fraud or misrepresentation qualifications. A favourable certificate’s protection depends on the specified section 45 application within six months and on the facts set out in the case.
Hypothetical business example
Hypothetical example: A brand owner proposes splitting closely related product rights between two buyers. It evaluates confusion and appropriate limitations before relying on a Registrar certificate.
Practical decision flow
Map the resulting proprietors, marks and goods or services.
Assess likely deception or confusion and any qualifying limitations.
If seeking a certificate, present the facts accurately and track the six-month title-application condition.
Applying the Act and current procedure
Read the statutory rule together with the applicable Trade Marks Rules, current Registry directions and the facts of the particular mark. Forms, fees and procedural requirements should be checked against their current official source before filing.
Practical checklist
Do
- Map the resulting proprietors, marks and goods or services.
- Assess likely deception or confusion and any qualifying limitations.
- If seeking a certificate, present the facts accurately and track the six-month title-application condition.
Avoid
- The certificate is subject to appeal and fraud or misrepresentation qualifications. A favourable certificate’s protection depends on the specified section 45 application within six months and on the facts set out in the case.
Glossary
- Multiple exclusive rights
- Exclusive rights divided between persons in the circumstances described.
- Certificate of validity
- The Registrar’s certificate on the proposed assignment within subsection (2).
Frequently asked questions
Does every split of rights automatically fail?
The actual statutory confusion test and proviso must be applied.
Is a favourable certificate unconditional?
No. Its factual basis, appeal, fraud and timing qualifications matter.
What six-month step is specified?
The section 45 application to register the new title after issue of a favourable certificate.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026