IMITATION V. INNOVATION: COUNTERFEITING AND THE LAW IN INDIA
INTRODUCTION
Imagine your creation being copied into a fake knock-off and sold under your name without your consent. This fraudulent imitation of goods is counterfeiting. The International Anti-Counterfeiting Coalition (IACC) defines counterfeiting as a crime, involving the manufacturing and distribution of goods under someone else’s name, and without their permission. It is generally an imitation of a genuine item and closely resembles the original in order to deceive consumers into believing it to be authentic.
In terms of its practice in India, counterfeiting is spread across numerous sectors from fashion, textiles, and cosmetics. Counterfeited products enter the market through broader channels and are then circulated through domestic markets, retail shops and e-commerce platforms. Due to the large population of the country and lack of regulation in the supply chain management and domestic markets, there is a lack of legal accountability, causing numerous owners of authentic products to suffer huge losses and the consumers being deceived.
In January 2025, the Delhi High Court granted injunction to Rahul Mishra in their case against counterfeiters, marking yet another case highlighting the need for stronger remedies against counterfeiters in India.
INDIA’S LEGAL AND REGULATORY FRAMEWORK
The subject matter of counterfeiting in India is not covered in a single comprehensive statute but is rather divided in various legal frameworks such as intellectual property laws, criminal statutes, customs regulations, and so on. The enforcement of these frameworks take place in India through a combination of methods of border measures, police raids, searches ordered by the Courts, and online takedowns, with the judiciary playing a central role.
IP Frameworks and Border Measures
Counterfeiting in India is covered under India’s IP laws and includes the Trade Marks Act, 1999 which covers the ambit of falsification of trademarks, sale of counterfeited goods, and search and seizure. The Copyright Act, 1957 also provides authorisation to the police officers to seize infringed copies without a warrant.
Furthermore, the Customs Act, 1962 and the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007 provides border measures and empowers Customs to suspend clearance and seize infringed goods.
Offline Practices
Offline practices in India are followed through the way of raids - police raids and Court-supervised raids. Police raids are carried under Section 115(4) of the Trade Marks Act, 1999 and Section 64 of the Copyright Act, 1957. Under raids which are supervised by the Courts, the Courts often issue the Anton Piller orders and John Doe injunctions to allow brand owners to locate and secure counterfeited goods.
Online Practices
Over the recent decades, there is an increase in fake domains and social media accounts. The Courts in India have adopted the issuing of dynamic injunctions along with directing domain registrars and platforms to suspend rogue sites and take down infringing listings. The Information Technology Act, 2000 and the IT Rules, 2021 address the regulations of these online counterfeits.
Intermediary Liabilities
With the growth of e-commerce platforms, social media marketplaces, and online intermediaries, counterfeit goods are no longer specifically found in only street markets. Intermediaries have now started to play a huge role in the trade of counterfeited goods.
In the case of Christian Louboutin v. Nakul Bajaj and Ors. AIR 2018 DEL 1962, the case dealt with intermediaries and held that the e-commerce platform in question was not a passive intermediary and hence, safe harbour was denied.
In the case of Rahul Mishra and Anr. v. John Doe and Anr. CS (COMM) 1194/2024, the Court granted Rahul Mishra dynamic injunction against counterfeit websites selling fake Rahul Mishra dresses.
GAPS AND CHALLENGES IN REGULATION
There might be numerous statutory and regulatory frameworks in India, however, the country lacks in executing these frameworks properly and thoroughly. The fragmentation of laws into multiple statutes leads to an overlap and confusion in the proper execution of these laws. They complicate the actions which are to be taken and cause confusion in the legal procedural steps which are to be followed. Furthermore, there are inconsistencies in the Court-made laws especially in cases where online platforms are involved.
The border measures with regards to customs action is largely limited to imports, however, as per the 2007 IPR Rules, there are exclusions which include personal baggage and small consignments. This limits border management severely since these factors are the largest mechanisms for small counterfeited parcels.
Intermediaries are also huge liabilities since there is a lack of regulation and tracking in the supply chain management. Although there are numerous statutory frameworks which aim to regulate this, there is a clear failure seen in terms of the execution.
Lastly, the penalties and fines assigned to counterfeiting are relatively moderate to low. Pairing that with a practical failure in proper enforcement of laws, there is a weak deterrence within the country.
REFORMS AND POLICY RECOMMENDATIONS
In order to resolve the gaps and challenges faced in the execution of the frameworks laid down, there must be unified laws and border and logistics control. The current laws dealing with counterfeiting are spread across multiple statutes causing confusion and complications. A single unified law based on anti-counterfeiting would resolve this issue. Along with that, the 2007 IPR Rules can be expanded in order to include practices which may resolve counterfeiting in small packages.
There must also be a strengthening of platform governance in terms of intermediary liabilities under Section 79 safe habour under the IT Rules. This can be achieved by legislatively clarifying the “active participation” test and codifying “dynamic injunctions”.
The enforcement capacity needs to be made stringent through additions of IP Divisions for search and seizure of goods as well as there must be transparency in the data collected through these enforcement methods.
CONCLUSION
Counterfeiting in India has negatively and severely expanded in India over the last few years and the growing pile of cases are evidence which cannot be ignored. Although India has laid down numerous frameworks to control the situation, it is now becoming obvious that there are huge gaps which require an urgent need to be resolved in order to protect the owners of the original goods from suffering any further damage and loss.
