SSRana Newsletter 2023 Issue 10

BLINKHIT and MISSED- Blinkhit Private Limited vs. Blinkit

By Arpit Kalra and Sulagna Goswami

Blinkhit Private Limited vs. Blink Commerce Private Limited (Blinkit)

The Hon’ble Supreme Court refused to restore the temporary injunction order passed by the additional City Civil Judge Bangalore on account of Appellant i.e. Blinkhit Private Limited having failed to establish any concrete business activity or financial transaction since its inception and further upheld the Karnataka High Court’s order of setting aside the trial court’s order on being erroneous.

Brief Background

The Addl. City Civil Judge, Bangalore vide its order dated August 10, 2022 passed an order in favour of the Appellant i.e. Blinkhit Private Limited inter alia granting temporary injunction restraining the Respondent i.e.

Blink Commerce Private Limited from infringing their registered trademark either by the way of Respondent’s use of the name/mark BLINKIT or any other variations thereof.

The said order was solely based on the Appellant’s contentions of having procured prior registration of the mark and to have cumulated vast reputation and goodwill in the market since its inception in 2016. Additionally, the Respondent’s (which was originally known as Grofers India private Limited) subsequent and fairly recent adoption of the deceptively and confusingly similar name/mark BLINKIT/ in 2021 has made the Appellant incur severe losses. The Appellant also went ahead and alluded the Respondent to have calculatedly and dishonestly adopted a similar mark only with the motive to ride upon the goodwill enjoyed by the Plaintiff, given its well repute all over the country.

Displeased with the trial court’s order, Blink Commerce Private limited proceeded to file an appeal in the Karnataka High Court on the ground of the trail court’s order to be erroneous, arbitrary and contrary to the well settled principles of law governing passing of an order of injunction in relation to trademarks.

Contentions of Blink Commerce Private Limited

• Registration of a trademark does not provide free pass to squat over the same without actually using the mark for the purpose of carrying out business.
• Not only is the nature of business of the entity different for which registration has been obtained, no actual business has been carried out since its registration, thus giving no rise to any cause of action.
• Trademark registration has been obtained for the device mark which incorporates multiple elements and thereby does not attribute specific rights to the name/mark BLINKHIT alone.
• The name/mark is visually, structurally, conceptually, and phonetically different from the mark or the alleged mark BLINKHIT, thereby leaving no room for any deception and confusion.
• Blinkhit Private Limited has made out a case of temporary injunction solely on the basis of mere similarities which is not sufficient to infer either infringement or passing off.

Comparison of IPR Rights

Blinkhit Pvt. Ltd.

Basis	Blink Commerce Private Limited	Blinkhit Private Limited
First Use	December 13, 2021	November 09, 2016
Trademark	Blinkhit Pvt. Ltd. Trademark Date Class Status Dec 24, 2021 16, 35, 38, 42 Opposed	demo Trademark Date Class Status B – BLINKHIT Feb 10, 2017 35 Registered B – BLINKHIT Feb 10, 2017 45 Registered
Goods & Services	Online software for providing delivery of grocery items	Social Work Services, Social Services Rendered by others to meet the needs of individuals, Providing information, including online, About Personal And Social Services, Consultancy Services relating to Social Planning, Dating And Social Introduction rervices provided via online Personal Advertisements
Company Name	Incorporated on May 26, 2015 Initially incorporated under the name Grofers Pvt. Ltd. Changed to Blink Commerce Pvt. Ltd. in 2021.	Incorporated on November 09, 2016
Website	Blinkit.com Blinkit.in  (December 02, 2021)	Iblinkhit.com – February 28, 2023 (Not operational)
Social Media	Facebook-311k Instagram- 116k LinkedIn- 505k Google Play Store- 1 Crore downloads App Store- 279k downloads	Facebook- 368 Google Play Store- 50 downloads

Despite Blinkhit Private Limited having obtained prior registration for the mark , online presence in terms of social media and application use/downloads portrays a very different view point. Blinkhit Private Limited’s lack of proper business operations since its inception is further substantiated by its non-operational website as well as nominal downloads of its application resulting in little to no activity of the same.

When compared to Blink Commerce’s reach and the quantum of engagement in terms of social media as well as application downloads, Blinkhit stands no ground to claim Blink Commerce Private Limited having adopted a similar mark to ride upon the goodwill or well set reputation, when they appear to possess none.

Karnataka High Court’s Order

• The court was of the opinion that merely obtaining registration of a trademark i.e. the device mark comprising of the word BLINKHIT as a component by Blinkhit Private Limited can not be construed or treated as document of title.The court also quoted a 2016 Apex Court judgment S.SyedMohideen vs P.Sulochana Bai wherein it was held “It is also a well settled principle of law in field of trade marks that the registration merely recognizes the rights which are already pre-existing in common law and does not create any rights’.In addition to above, the court quoted the judgment passed by the Hon’ble Delhi High Court in Century Traders v. Roshal lal Duggar & Co. “Use plays an all important part. A trader acquires a right of property in a distinctive mark merely by using it upon or in connection with his goods irrespective of the length of such user and the extent of his trade. Registration under the statute does not confer any new right to the mark claimed or any greater rights than what already existed at common law and at equity without registration. …. The trade mark exists independently of the registration which merely affords further protection”.
• Further the court emphasized that in case of conflict between registered proprietors, the evaluation of better rights is based on the principles of common law rights i.e. by way of use. Given that registration of rights was introduced later, registration is held as mere recognition of pre-existing rights in common law and rights under common law shall be held superior.
• The court also took note that the nature of business of Blinkhit Private limited is completely different to that of the Blink Commerce Private Limited. Having obtained registration in the same class but carrying completely difference business does not make a prima facie café of temporary injunction.
• Lack of any financial activity and income as reflecting on the balance sheet /profit and loss account statement of Blinkhit Private Limited is sufficient to establish that no business activity was being conducted under the mark . Thereby, Blinkhit Private Limited not only abandoned the same but also disentitled itself to an order of temporary injunction.
• The court concluded the balance of convenience to be in favour of Blink Commerce Private limited who would actually suffer irreparable injury and hardship if an order of temporary injunction is passed against them in comparison to Blinkhit Private limited who would be caused no prejudice, injury, loss or hardship if injunction is refused.

Analysis

The Karnataka High Court time and again emphasized over the existing rights one possesses under the common law and that registration is just a mere recognition of the pre-existing rights. By virtue of the same, despite Blink Commerce Private Limited not having statutory rights of the name/mark BLINKIT/ , its extensive and continuous use since 2021 was given precedence over a registered mark which has next to no use.
In view of the present case, the Hon’ble Supreme Court saw through the lack of financial activity and called out the Appellant’s zero turnover. The court simply disregarded the trademark registration obtained by the Appellant and its non-use since inception i.e. since 2016 was given precedence compared to the expansive and continuous use of the Respondent.

Non-use of the mark by the Blinkhit Private Limited also turned out to be detrimental when it came to adjudicating the balance of convenience. Given the next to no use of the Appellant, no loss, injury or harm was to be suffered if temporary injunction was not granted. Whereas, the said temporary injunction would have led to an immense loss to Blink Commerce Private Limited, given the mobile application under the mark is used widely by more than 1 crore users in India.

However, one should always conduct due diligence at their end and peruse through the registry’s record for possible hindrances prior to taking such an important decision of re-branding their business. Prior registrations will always come around to create impediments. It was the non-use of the registered trademark which led to the shift of balance of convenience.

Therefore, obtaining registration of the mark just bestows upon the right to seek remedy, however non-use post registrations shall leave your rights unprotected. The rights so obtained by registration is not a one stop solution for overall protection. One has to understand the holistic nature of brand protection where registration and enforcement actions go hand in hand with promoting and propagating the business under the said brand you seek to protect.

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Non-Submission of Evidence By Way Of Affidavit not a ground to refuse Well-Known Status of Trademark

By Hashmeeta Sehgal and Harsh Maheshwari

In a recent case of Kamdhenu Ltd vs The Registrar Of Trade Marks[1], the Hon’ble Delhi High Court passed a noteworthy order while holding that documentary evidence without an affidavit can still establish well-known status of the mark. While allowing the Appeal in the present case, the Court held that Non-filing of the affidavit by the Appellant could not have resulted in the dismissal of the Application itself.

FACTS:-

• A request under the Form-TM-M vide Application no. TM-M764900 of the Trade Mark Rules 2017 (hereinafter referred to as the “the Application”) was filed by M/s Kamdhenu Limited (hereinafter referred to as the “the Appellant”) dated August 17, 2017 to include the trademark ‘KAMDHENU‘ in the List of Well-Known Trademarks in India.
• The Registrar rejected the grant of the Application primarily stating the reason that the Appellant failed to provide evidence of the wellknown status of the mark by way of an affidavit.
• In the impugned order, the Registrar has referred and commented on the cases upon which the Appellant relied in the documentary evidence as below:

Khody Eshwarsa & Sons, Bangalore vs. Kamdhenu Ispat Limited.

In this matter although a reference is made in regard to well-known status of the mark Kamdhenu but the same was not been determined but it is simply a passing reference. Neither any issue as to well known status of the mark was raised nor was it contested nor any material was appreciated by the Registrar for determination of the trademark as well known trademark.

Kamdhenu Ispat Limited vs. Kamdhenu Metal; CS (OS) No. 1204 of 2004

An ad interim injection was allowed in favour of the plaintiff but the Hon’ble court has not observed Kamdhenu as a well-known trademark although a reference as such was made in the submissions by the Ld. Counsel for the plaintiff.

Kamdhenu Ispat Limited vs. Pragati Primary Milk Products; CS (OS) 2564 of 2015

An injunction was granted on the basis of deceptive similarity of the mark under question and the basis of engagement of the plaintiff in the same field of activities of the plaintiff. The Hon’ble court has nowhere observed or determined Kamdhenu as a well-Known trademark.

The Tribunal relied upon the above observations to conclude that the Mark ‘KAMDHENU‘ shall not be included in the list of Well-Known trademarks as per the provisions of Rule 124 of The Trade Marks Rules, 2017.

• The Appellant claimed to be the owner and proprietor of the trademark ‘KAMDHENU‘ which was adopted by the Appellant in the year 1994 in relation to various goods and services such as TMT steel bars, structural steel, plywood, PVC pipes, plaster of paris, etc. Over the years the Appellant gradually ventured into the business of milk, dairy products, mineral water, paint, reals estate, etc. since 1994. The aforesaid expansion is mentioned as below:

Blinkhit Pvt. Ltd.

S. No.	Name	Goods	Date
1	KAMDHENU TMT	TMT Bars.	1994
2	KAMDHENU CEMENT	Cement.	2005
3	KAMDHENU POP	POP	2006
4	KAMDHENU HOMZ	Real Estate.	2006
5	KAMDHENU WIRE BOND	Wire Bond.	2006
6	KAMDHENU PLYWOOD	Plywood	2007
7	KAMDHENU STRUCTURAL STEEL	Structural Steel.	2007
8	KAMDHENU COLOUR DERAMZ	Paints.	2008
9	KAMDHENU MILK	Milk.	2008
10	KAMDHENU PVC	PVC Pipes.	2008
11	KAMDHENU CONSTRUCTION CHEMICALS	Construction Chemicals.	2009
12	KAMDHENU FRESH	Mineral water.	2009
13	KAMDHENU SS10000	Premium TMT	2013
14	KAMDHENU SHEETS	Colour Coated Sheets	2014
15	KAMDHENU NXT	TMT Bars	2017

 

• The Appellant has also filed and registered several trademarks in various classes, and has also obtained copyright registrations for the mark ‘KAMDHENU’. The Appellant prominently features its mark ‘KAMDHENU’ on its registered domain name www.kamdhenulimited.com which is being used for Advertisement and Promotion purpose.
• The Appellant claims to have a network of more than 8500 dealers and produces 25 lakh metric tons of steel bars and structural steels every year. With their strong reputation and expansion into different industries, the Appellant intended to seek well-known status.
• The Application was filed dated August 17, 2017, along with various documents evidencing use of the mark ‘KAMDHENU’ such as newspaper advertisements, contracts, invoices, media-related documents, a list of successful cases laws and judicial orders recognizing the ‘KAMDHENU’ as a well-known mark were filed.
• Pursuant to a hearing dated February 22, 2018 before the Learned Deputy Registrar of Trade Marks and Geographical Indication, the Application was rejected primarily due to the Appellant’s failure to provide evidence of the well-known status of the said mark by way of an Affidavit.
• The Appellant filed an appeal before the Intellectual Property Appellate Board (IPAB) in 2019, which was later transferred to the Delhi High Court in the year 2021 after the abolition of the IPAB.

Submissions by the Appellant

The learned counsel appearing on behalf of plaintiff made the following submissions before the honorable court:-

• As stated in the order, the Learned Registrar rejected the Application primarily on the ground of non-filing of evidence by way of an Affidavit even after several documentary evidence were submitted in support of their claim for inclusion of the mark ‘KAMDHENU’ as well-known.
• Rules 80, 86, 95, 96 and 45 of the Trademark Rules 2017 specifically state, whenever the evidence is to be filed by way of an affidavit. Further, Rule 124 of the Trademark Rules, 2017 does not mandate that the submission of evidence has to be filed only by way of an Affidavit in order to include a mark under the List of Well-Known marks in India. If documentary evidence is filed, the same should be sufficient for compliance with the said rules.
• Filing only the supporting documentary evidences along with the application, could have been considered as a curable defect and instead of directly rejecting the Application, an opportunity should have been provided to the Appellant to file the required Affidavit.
• Relying upon the provisions of the Indian Evidence Act, 1872, the Appellant stated that evidence include both oral and documentary evidence and as per the Section 1, the Indian Evidence Act is not applied to Affidavits which are presented before a Court or an officer. Thus, submission of merely an Affidavit is not considered as an evidence and rejecting an application solely on this ground is unjustified.
• That Section 129 of the Trade Marks Act, 1999 states that during any proceeding before the Registrar, the evidence shall be given by Affidavit. However, if the Registrar deems it appropriate, they may accept oral evidence instead or in addition to the evidence provided by Affidavit. The Appellant further content that the provision is a directory provision, in terms of the Statement of Objects and Reasons accompanying the Trade Marks Bill, 1999.

Submissions by the Respondent

The Respondent i.e. the Registrar of Trademarks relied upon a public notice dated May 22, 2017 issued by the Office of the Controller General of Patents, Designs and Trademarks which stated the requirements of filing evidence in order to declare a mark as well-known.
Further they also contended that, considering the nature of the evidences if an Affidavit is not filed it would mean that the same cannot be considered by the Registrar.

What are Well-known Trademarks?

The concept of Well-Known Trademarks was introduced by the Trade Marks Act, 1999. A well-known trademark is defined in Section 2(zg) of the Trade Marks Act 1999. The Registrar is obligated to consider certain facts while determining whether a mark is a well-known trademark or not, as laid down in Section 11(7) of the Trade Marks Act, 1999. Further, Section 11(9) of the Trade Marks Act, 1999states the negative stipulations, laying down the conditions that may not be required for considering a mark as a well-known mark

Issue raised in the case:

What is the nature of the evidence and the documents which are to be filed by an Applicant for determination of a Trademark as a well-known trademark under Section 11 of the Trade Marks Act, 1999 read with Rule 124 of the the Trade Mark Rules 2017?

Court’s Observations

After hearing the submissions of both the parties, the Hon’ble Court observed the following:

1. As stated in the case Rolex SA v. Alex Jewellery Private Limited [215 (2014] DLT 6] “The test of a well known trademark in Section 2(zg) is qua the segment of the public which uses such goods”, it was observed that that a mark need not be widely known by the general public or society as a whole. Instead, it is sufficient if the mark is well-known within a specific segment of the trade or consumers. Further in the case Tata Sia Airlines Ltd. v. Union of India (2023:DHC:3659), it was observed by the court that Rule 124(5) of the Trade Mark Rules 2017 does not draw any difference between a well-known trade mark declared by the Court, or by the Registrar.
2. As per Rule 124 of the Trade Mark Rules 2017, Form TM-M i.e. the Application is to be filed along with the statement of case, all the evidence and documents in order to record a mark as well-known in the List of Well-known Marks. Thereafter, the Registrar will determine whether the mark is well-known. Rule 124 of the Trade Mark Rules 2017 states as below:

   “124. Determination of Well Known Trademark by Registrar.-

   1. Any person may, on an application in Form TM-M and after payment of fee as mentioned in First schedule, request the Registrar for determination of a trademark as well-known. Such request shall be accompanied by a statement of case along with all the evidence and documents relied by the applicant in support of his claim.
   2. The Registrar shall, while determining the trademark as well-known take in to account the provisions of sub section (6) to (9) of section 11.
   3. For the purpose of determination, the Registrar may call such documents as he thinks fit.
3. Further, the Learned Judge stated that the documentary evidences required while filing a request for well-known mark would have to be substantially documentary and showing continuous use, reputation and goodwill of a trademark and could include the following :-
   • Invoices showing use of the mark in a large geographical area rather than a restricted area;
   • Promotion and advertising of the mark through investment made as also copies of electronic and print advertising;
   • Participation in exhibitions, trade fairs, any market survey, decisions of Courts enforcing the trademark in respect of related or unrelated goods;
   • The consumer base for the concerned product or service and any material that would establish the recognition of the mark by the said consumer base, such as a Market Survey;
   • Number of C&F Agents, wholesale distributors, retail distributors, retailers;
   • Exposure on e-commerce platforms;
   • Any awards or recognition.
   • Balance sheets, chartered accountant certificates and other accounting related documents to establish sales figures and investment on promotion, advertising, etc.
4. Rule 124 of the the Trade Mark Rules 2017 states the word “evidence and documents” which could also include affidavits by way of evidence and other documents. The Hon’ble Court also noted that the Trade Marks Rules nowhere states that submitting an affidavit along with documentary evidence is mandatory. Submitting mere Affidavit by way of evidence without supporting documents may not be sufficient to determine the well-known status of the mark and submitting of documentary evidence without of an Affidavit are enough to prove well-known status of the mark.
5. While some documents may be publicly acknowledged and verifiable without an affidavit, others may require one to support certain facts, such as the reasons for adoption of a mark. However, there is no hard and fast rule that an affidavit is mandatory, and even the Public Notice nowhere mentions the requirement of an affidavit.
6. That an Affidavit by way of evidence cannot be set as an essential pre-requisite to determine the well-known status of the mark but documentary evidence would be essential under the Trade Marks Act, 1999 and the the Trade Mark Rules 2017. However, if the Registrar believes that certain documents need to be supported by an Affidavit, then opportunity may given to the Appellant to file the Affidavit and allow them to provide additional evidence or address any concerns raised, instead of rejecting the application;
7. The Court also noted that in the present case, the Appellant had submitted supporting documents and hence the Registry should have given it an opportunity to establish its claim for well-known status, instead of dismissing the Application directly.

Decision of the Court

After observing the above submissions, the Hon’ble Court issued an order in favor of the Appellant. The Court granted the Appellant an opportunity to file a supporting Affidavit and any further documents in support of its Application for the recordal of its mark ‘KAMDHENU’ as well-known before the Registrar of Trade Marks within eight weeks. Further, the Court ordered the Registrar to schedule a hearing in the said matter, and decide the said application in accordance to the merits of the case.
[1] C.A.(COMM.IPD-TM) 66/2021

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Navigating the Maze of EPF Inoperative Accounts: The Interest Conundrum

By Rupin Chopra and Shantam Sharma

Introduction

The Employees’ Provident Fund (EPF) is a cornerstone of the social security scheme established under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952¹ . This scheme plays a vital role in securing the financial future of the salaried class in India. Managed by the Employees’ Provident Fund Organization (EPFO), EPF accounts are mandatory for employees earning up to ₹15,000 a month in establishments with over 20 workers. Under this scheme, both the employee and the employer contribute 12% of the employee’s monthly salary (comprising basic wages plus dearness allowance); of the employer’s share, 8.33% is allocated to the Employees Pension Scheme (EPS). The EPF interest rate is declared annually by the EPFO. However, one contentious issue regarding EPF interest arises when accounts become inoperative.

Interest on Inoperative Accounts

The issue of interest on inoperative accounts stems from Paragraph 72(6) of the EPF Scheme, 1952² (“Scheme”), which classifies an account as inoperative³ . These accounts have typically lain dormant for various reasons, leaving the funds in a state of limbo. Situations that lead to an account being classified as inoperative are:

1. Member Has Not Withdrawn Money within 36 months after retirement or migrated abroad: One common scenario that results in an inoperative account is when a member retires from their job or permanently moves abroad but does not withdraw the EPF balance within 36 months. The funds remain untouched, and the account becomes inactive.

Example: Mr. Sharma retired from his previous company in 2020 but did not withdraw his EPF balance. Hence, In 2023, his EPF account was classified as inoperative.

2. Member Has Died, But the Claim Has Not Been Filed or Settled within 36 months of his death: In unfortunate cases where a member passes away, but no claim has been filed or settled within 36 months of the member’s death, the account is categorised as inoperative.

Example: Priya’s husband passed away after joining a new company, and she did not file a claim for his EPF balance within 36 months of his death. His account, thus, becomes inoperative.

3. Amount Remitted to a Person Has Been Undelivered or Not Claimed Back: Sometimes, the EPF funds sent to a member may remain undelivered or unclaimed. In such cases, the account turns inoperative until the issue is resolved.

Example: Mr. Singh’s EPF funds were undelivered due to want of latest address, and he never received them. His account is marked as inoperative.

4. Employer Has Not Made Any Contribution to the Account (for 36 Months): When an employer ceases contributions to an employee’s EPF account for an extended period, typically 36 months, the account can be considered inoperative.

Example: Mr. Khan’s company stopped contributing to her EPF account for three years due to financial difficulties. Her account becomes inoperative.

Inoperative accounts represent a unique challenge within the EPF framework. They often raise questions about the payment of interest and the accessibility of funds for members. Before the 2011 amendment⁴ to the Scheme, there was no statutory embargo on payment of interest on inoperative accounts. But, after the 2011 amendment, Paragraph 60(6)⁵ was introduced that imposed an embargo on interest payments on inoperative accounts.

However, the 2016 amendment⁶ to the scheme introduced significant changes in Paragraph 72(6) of the scheme which dealt with the definition of inoperative accounts. The words “ceased to be employed” were replaced with “retired from service after attaining the age of 55 years or migrated abroad permanently.”

This meant that, post-2016, the cessation of employment became irrelevant for determining inoperability. Instead, the crucial factor became retirement after reaching the age of 55 years or permanent migration. The account would become inoperative after 36 months from the date of retirement or migration if no application for withdrawal was made during that time.

These two amendments raise a fundamental question: What is the extent of interest payment on inoperative accounts? Does a member who left the job before 2011 and claims interest after 2016 receive interest for the entire period from when the account became inoperative, or are they entitled to interest only until 2011 when the account initially became inoperative, based on the 2011 amendment?

Answering the Question

To address this confusion, several high courts, including the Hon’ble High Court of Madras, have taken up cases involving interest on inoperative accounts. The case of M.V.Ramakrishnan vs The Provident Fund Commissioner⁷ serves as a noteworthy example.

Mr. M V Ramakrishan worked at “Thermax Limited” from 1992 to 2006. He sought provident fund of Rs. 4,35,551 until March 2011, along with interest accrued on that amount. However, he was informed that he could not claim any interest beyond March 2011, as he left the company before April 2011. Dissatisfied with this decision, Mr. Ramakrishan filed a writ petition in 2017.

In response, the respondents argued that the amendment to Paragraph 72(6) in 2011 rendered Mr. Ramakrishan’s account inoperative as he ceased to be employed after July 2006, and he did not apply for withdrawal within 36 months of the amount becoming payable. According to the amendment, interest should not be credited to an inoperative account from the date it becomes inoperative. However, they also noted that another amendment in 2016 entitled Mr. Ramakrishan to interest, which was duly credited to his account.

The crux of the dispute was whether Mr. Ramakrishan was entitled to interest for the period between 2011-12 and 2016-17. Mr. Ramakrishan’s counsel argued that, since he had not retired after turning 55 and had no occasion to make a withdrawal, the respondents could not deny him interest for the mentioned period.

In contrast, the respondents relied on the amended Paragraph 72(6) of the Employees’ Provident Funds Scheme, 1952, stating that Mr. Ramakrishan was not entitled to interest from 2011-12 to 2016-17 because he ceased employment before the 2011 amendment and was not covered by the 2016 amendment.

Conclusion

The High Court’s decision in Mr. M V Ramakrishan’s case highlights the importance of legal clarity in matters related to interest on inoperative PF accounts. In this instance, the Court determined that Mr. Ramakrishan was not entitled to interest for the period from 2011-12 to 2016-17, as he fell under the purview of the 2011 amendment, which barred interest on inoperative accounts.

The amendments made to Paragraph 72(6) in 2011 and 2016 created a situation where members like Mr. Ramakrishan, who left their jobs before 2011 but sought interest after 2016, faced uncertainty and potential disputes. The High Court’s decision, thus, brought much needed clarity with regards to interpreting the law on interest paid to inoperative PF accounts, ensuring that employees receive their rightful due, ultimately serving the broader goal of social security and financial well-being for all.

1 Available at: https://www.epfindia.gov.in/site_docs/PDFs/Downloads_PDFs/EPFAct1952.pdf
2 Available at: https://www.epfindia.gov.in/site_docs/PDFs/Downloads_PDFs/EPFScheme.pdf
3 Paragraph 72(6) of EPF Scheme, 1952 Available at: https://www.epfindia.gov.in/site_docs/PDFs/Downloads_PDFs/EPFScheme.pdf
4 Subs. by G.S.R. 25(E), dated 15th January, 2011 (w.e.f. 1-4-2011)
5 (6) Interest shall not be credited to the account of a member from the date on which it has become Inoperative Account, under the provisions of sub-paragraph (6) of paragraph 72.
6 Notification for amendment to para 72 (6) of EPF Scheme, 1952 (inoperative accounts) – 11.11.2016 Available at: https://labour.gov.in/sites/default/files/11.11.2016_notification_for_amendment_to_para_72_6_of_epf_scheme_1952_inoperative_accounts.pdf
7 W.P.No.29166 of 2017

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TikTok’s Liability: Violation of Children’s Data

Introduction

In recent years, the Chinese-owned short video platform, TikTok has witnessed a meteoric rise in popularity, particularly among the demographic of teenagers. This surge in growth has made TikTok a global sensation, shaping the social media landscape and redefining how the younger generation interacts with content and each other in the digital arena.

However, the rise of TikTok has not been without its share of controversies and concern. Issues related to data privacy and content moderation have raised questions about the platform’s safety and security, which further led to increased scrutiny by regulators and policymakers in various countries.

TikTok is becoming a more frequent target of parents, policymakers and regulators who are wary of the company’s data-collection practices and the platform’s effect on the mental health of young people. In a 2022 survey, 67 percent of American teens said they use TikTok, with 16 percent saying they use it “almost constantly,” according to the Pew Research Center.[1]

Fine on TikTok

Recently, it has been brought to light that the European Union regulator imposed a substantial fine of 345 million euros on TikTok for violating the European strict data privacy rules, particularly pertaining to processing of children’s personal data.

The 345 million euros fine, which is equivalent to 369 million dollars, represents the culmination of a two-year inquiry conducted by the Ireland’s Data Protection Commission (DPC).

The Irish regulatory authority, which holds a pivotal role in enforcing the EU’s GDPR regulations, granted TikTok a three month period to align its data processing practices with the prescribed rules.

In the month of September 2021 the DPC initiated an assessment of TikTok’s adherence to GDPR standards concerning platform configurations and the processing of personal data for users below the age of 18 years. The DPC also scrutinized the age verification measures adopted by TikTok, concluding that there were no infringements in this regard. However, the investigation did reveal that the platform had not conducted thorough assessment of the potential risks associated with younger individuals registering on their services.

The European regulators in its ruling dated September 15, 2023 highlighted that an investigation found that children who signed up for TikTok had their accounts configured as “public” by default, allowing anyone to view and/or comment on their content.

The DPC also raised concerns regarding TikTok’s “family pairing” mode, which is intended to connect parents accounts with those of their teenage offspring and discovered through its investigation that the company did not adequately verify the parental or guardian status of users utilizing this feature.

TikTok respectfully disagrees

However, TikTok respectfully disagrees with the decision of imposing the fine, saying it has made the changes well several months before the investigation even began, toughening parental controls to family pairing in November 2020 and making all accounts for teen under 16 private by default in January 2021.

TikTok’s head of privacy, Elaine Fox, published a statement arguing that the platform has made several changes to make it easier for younger users to understand the app’s privacy policy since 2021. Fox said the company plans to “further strengthen protections for teenagers on TikTok”.[2]

It was also contended by TikTok that it closely monitors the age of its users and take action, as and when required. Furthermore, TikTok claims to delete approximately 17 million accounts worldwide in the first three month of this year due to suspicions that they belonged to people under 13 years old.[3]

TikTok has announced its intentions to enhance its privacy documentation, with a specific focus on providing greater clarity on the distinction between public and private accounts. As part of these efforts, the platform will automatically preselect a private account option for users aged 16 or 17 when they register for the app, starting later this month.

The DPC granted TikTok a 3 months grace period to rectify all the processing practices that were found to be non-compliant with the regulations.

The regulator is still carrying out a second investigation into whether TikTok complied with the EU’s General Data Protection Regulation when it transferred users’ personal information to China, where its owner, ByteDance, is based. [4]

TikTok has faced accusations it poses a security risk over fears that users’ sensitive information could end up in China. It has embarked on a project to localize European user data to address those concerns: opening a data centre in Dublin this month, which will be the first of three in the continent.

Conclusion

This is not the first time TikTok has been punished for its handling of children’s data. In April, British regulators fined the company 12.7 million pounds, worth about $15.8 million today, for not preventing children under the age of 13 from signing up for the service. In 2019, Musical.ly, the service that would later become TikTok, agreed to pay $5.7 million to settle charges by the Federal Trade Commission for violating U.S. data protection rules for children.[5]

In addition to TikTok, several other major tech industry players, including Instagram, WhatsApp and their parent company, Meta have faced substantial fines imposed by the Irish regulator over the course of the past year. These fines have underscored the heightened scrutiny and enforcement measures being applied to big techs regarding data protection, privacy and compliance with relevant regulations.

The Irish regulator’s actions reflect the growing emphasis on holding tech giants accountable for their data handling practices and ensuring that they adhere to the stringent standards set forth by data protection laws such as the GPDR and now the newly enforced Digital Personal Data Protection Act, 2023 (also known as the DPDP Act) in India as well.

As the digital landscape continues to evolve, it is imperative to acknowledge that children now make up a substantial portion of active internet users. In today’s fast-paced online environment, their digital activities are changing and expanding at an unprecedented rate. This dynamic shift has given rise to significant concerns surrounding the paramount importance of safeguarding both the safety and privacy of these young users. In furtherance of the same, the children’s data should be subjected to a greater protection.

As per the DPDP Act, child means an individual who has not attained the age of 18 years. The DPDP Act places additional obligation on the Data Fiduciaries to obtain “verifiable consent” from the parent or legal guardian, as the case may be, before processing the personal data of a child as enumerated under Section 9 of the DPDP Act.[6] Failure to adhere to such data protection regulation can result in substantial penalties, which may extend to INR 200 crore.

Further, the implementation of the DPDP law implies that the social media platforms will now have to obtain parental consent for users between the age groups of 13 years and 18 years, thereby, confirming the identity of both the child and their parents. Likewise, if a parent agrees to share the data, they will have to enter a one-time password (OTP) to provide consent. This consent will then be recorded in the parent’s consent ledger. The mechanism will be such that the parents would be required to declare all their children, hence, consequently allowing mapping of children with their parents. For more information, please refer to our article titled: “Parental Consent to be stored in Digilockers”.[7]

In today’s interconnected world, where data breaches and privacy violations are widely publicized, the consequences of non-compliance extend beyond monetary penalties, they can tarnish an entity’s image and erode the trust that stakeholders, clients and the public place in them. Therefore, it is imperative for all entities handling personal data to prioritize compliance with data protection regulations to safeguard their financial stability and maintain their hard-earned reputation.

[1] https://www.nytimes.com/2023/09/15/business/tiktok-european-union-fine.html

[2] https://therecord.media/TikTok-gdpr-violations-child-accounts-fine

[3] https://telecom.economictimes.indiatimes.com/news/mvas-apps/eu-hits-TikTok-with-big-fine-over-child-data/103701822

[4] https://www.reuters.com/technology/tiktok-fined-345-million-euros-over-handling-childrens-data-europe-2023-09-15/

[5] https://www.nytimes.com/2023/09/15/business/tiktok-european-union-fine.html

[6] https://www.meity.gov.in/writereaddata/files/Digital%20Personal%20Data%20Protection%20Act%202023.pdf

[7] https://ssrana.in/articles/parental-consent-stored-digilockers/

India Attains International Organisation of Legal Metrology Certificate-Issuing Authority Status: Boosting Global Competitiveness

By Rupin Chopra and Shantam Sharma

Introduction

The ever-evolving landscape of food safety regulations in India has witnessed another milestone as the Food Safety and Standards Authority of India (FSSAI) recently unveiled a significant amendment¹ to the Food Safety and Standards (Alcoholic Beverages) Regulations, 2018² (for brevity “Regulations”). To fully appreciate the implications of this recent amendment, it is essential to delve into the historical context of its inception.

This amendment, which was initially drafted and published in the Gazette of India on 17th May 2022, is mandated by section 92(1) of the Food Safety and Standards Act, 2006. Following a 60-day window for public suggestions and objections, FSSAI has now unveiled the final version of this amendment after careful consideration.

Understanding the OIML

The Food Safety and Standards (Alcoholic Beverages) First Amendment Regulations, 2023 (for brevity “Amended Regulations”) are set to be enforced starting from 1st March 2024. This transitional period affords manufacturers, distributors, and retailers the time necessary to adapt to the new labelling requirements and definitions.

The Amended Regulations bring several key takeaways into the limelight. Here are the major highlights:

• Malt or Grain Whisky Revisions:

³Single Malt Whisky: The amendment introduces a refined definition of single malt whisky, which is now characterized as a distillate obtained exclusively from fermented mash that employs malted barley, with no other grain additives. Furthermore, it must be distilled using pot stills and produced within a single distillery.

Example: Consider the case of a renowned whisky producer in India. Previously, they labelled a certain product as “single malt whisky” even though it contained traces of other grains in the fermentation process. With the new regulations, they will be required to change the label to accurately reflect the product’s classification as “single grain whisky.”

Single Grain Whisky: This category encompasses distillates produced in a single distillery using either malted or unmalted grains, but crucially, it excludes single malt whiskies, blended malt whiskies, and blended grain whiskies.

In other words, the definition of single malt whisky has undergone a transformation. It now exclusively refers to a distillate obtained from fermented mash that uses malted barley without any addition of other grains. This whisky must also be distilled using a pot still and produced within a single distillery. Moreover, the new regulations introduce the concept of single-grain whisky, involving a distillate obtained from a fermented mash using malted or unmalted grain. However, this category explicitly excludes single malt whisky, blended malt whisky, and blended grain whisky.

Labelling Norms Update⁴:

Perhaps the most notable change in this amendment is the exclusion of nutritional I information from alcoholic beverage labels. Part 5 of the regulations governs labelling requirements. The only exception permitted is the declaration of energy content in kilocalories (kcal), which remains a voluntary declaration for producers.

Example: Until now, consumers in India could easily find information on the nutritional content of alcoholic beverages, including details about carbohydrates, proteins, fats, and more. With the new regulations, this information will no longer be available on the labels, except for the calorie count. This change may impact consumers who have grown accustomed to making informed choices based on nutritional data.

Blinkhit Pvt. Ltd.

Regulations	Amended Regulations
(i) Single malt or Single grain whisky: Single malt or Single grain whisky is a distillate obtained from fermented mash that uses one particular malted barley or malted grain, respectively, distilled in pot still only, and produced in a single distillery.	(i) Single malt whisky is a distillate obtained from fermented mash that uses malted barley without adding any other grain, which is distilled in pot still only and produced in a single distillery.   (ia) Single grain whisky is a distillate obtained from a fermented mash that uses malted or unmalted grain, and produced in a single distillery. Single grain whisky shall not include single malt whisky and blended malt whisky or blended grain whisky
5.5 Alcoholic beverage shall not contain any nutritional information on the label.	5.5 Alcoholic beverage shall not contain any nutritional information on the label except energy content in kcal. Such declaration related to energy content shall be voluntary

Conclusion

The FSSAI’s unwavering commitment to enhancing food safety and quality standards in India is clearly evident in its continuous efforts to refine regulations and ensure consumer protection. The Amended Regulations, signify a significant step forward in aligning regulations with evolving industry practices while prioritizing transparency and information for consumers. As the implementation date approaches, stakeholders in the alcoholic beverage sector are strongly advised to familiarize themselves with these amendments to ensure compliance and a seamless transition. These changes not only enhance the clarity surrounding alcoholic beverages but also reinforce FSSAI’s commitment to serving the best interests of consumers and the industry alike.

[1]Notification- CG-DL-E-23082023-248239, Dated August 23, 2023, Available at:https://www.fssai.gov.in/upload/notifications/2023/08/64e6eb3635eb8FSS%20(Alcoholic%20Beverages)%20First%20amendment%20regulations,%202023.pdf

[2]Available at: https://www.fssai.gov.in/upload/uploadfiles/files/Compendium_Alcoholic_Beverages_Regulations_04_03_2021.pdf

[3]Regulation 2.8.1 (i) of the Food Safety and Standards (Alcoholic Beverages) Regulations, 2018

[4]Regulation 5.5 of the Food Safety and Standards (Alcoholic Beverages) Regulations, 2018