Centre Not Precluded From Directing Name Change Of Company With Similar Name On Application By Complainant Company: Delhi High Court
The Delhi High Court was considering a Petition challenging an order passed under Section 16(1)(a) of the Companies Act, 2013.
Justice Anish Dayal, Delhi High Court
The Delhi High Court has dismissed a petition challenging an order directing the name change of a company as it resembled the complainant company’s name. The High Court also clarified that the Central Government cannot be precluded from formulating an opinion and moving forward with a decision under Section 16(1)(a) of the Companies Act, 2013 only because it was triggered by an application.
The High Court was considering a Petition challenging an order passed by the second respondent (Regional Director, Office of Regional Director) under Section 16(1)(a) of the Companies Act, 2013, whereby the petitioner/company (DNA Forensics Test Solution Private Limited) was directed to change its name, on the ground that it was similar to and, resembled that of the respondent-complainant company, namely, ‘DNA Forensics Laboratory Private Limited’.
The Single Bench of Justice Anish Dayal held, “The Central Government cannot be precluded from formulating an opinion and moving forward with a decision under Section 16(1)(a) of the Act, only because it has been triggered by an application. That would be curtailing and binding the hands down of the regulator to an extreme and illogical extent.”
Advocate Mohd. Kashif represented the Petitioner while Senior Panel Counsel Sarika Singh represented the Respondent.
Arguments
The petitioner raised an issue of jurisdiction and stated that the trigger under Section 16(1)(a), is in contradistinction to Section 16(1)(b) of the Act. Under Section 16(1)(b) of the Act, a direction can be issued on an ‘application’ made by the registered proprietor of a trademark; whereas under Section 16(1)(a), it has to be based upon an ‘opinion’ of the Central Government. It was the petitioner’s case that since the impugned order was triggered by an application moved by the complainant company, the same could not be entertained under Section 16(1)(a).
Reasoning
The Bench explained, “Under Section 16(1)(a) of the Act, decision is taken by the Central Government if it opines, that the name of a newly registered company is identical with or too nearly resembles the name of a company in existence which had been previously registered, and therefore, it can direct the newly registered company to change its name.”
The Bench noted that Section 16(1)(b) of the Act is triggered by an application, since the registered proprietor of a trademark, who is aggrieved with an identical name being used by a newly registered company, will necessarily apply for getting the name struck off. “However, Section 16 (1)(a) of the Act is a wider power, which allows the Central Government to suo motu, on its own, direct rectification of a name, in case it is found to be identical or too similar”, it added.
The Bench took note of the petitioner’s acceptance of the fact that the petitioner/company was working in exactly the same area as that of the complainant company i.e. DNA testing. “Therefore, the similarity between DNA Forensics Test Solutions Pvt. Ltd. (petitioner company) and DNA Forensics Laboratory Pvt. Ltd (respondent no. 3/complainant company) is too similar/almost identical, to ignore.”, it stated.
Taking such facts and circumstances into consideration, the Bench dismissed the Petition.
Cause Title: DNA Forensics Test Solutions Private Limited v. Union of India (Neutral Citation: 2026:DHC:5949)
Appearance
Petitioner: Advocates Mohd. Kashif, Mohd. Suza Faisal
Respondent: Senior Panel Counsel Sarika Singh