Fabindia has started removing the brand name Khadi it uses to promote its cotton products after a legal notice by Khadi India that the use of the word amounted to "unfair trade practice" and misusing its trade name.
Khadi & Village Industries Commission (KVIC) had sent a legal notice to Fabindia Overseas Pvt Ltd, a chain of ethnic wear retail outlet, asking it to immediately stop using the word Khadi from all its cotton products and remove display banners from its showrooms.
Sources said Fabindia CEO Viney Singh has responded to KVICs notice, saying it was complying with all the directions of the KVIC. Fabindia has stated that "as per the direction issued" by KVIC, it has complied with them, they said.
Fabindia, in its reply, has also sought a meeting with KVIC officials to explain its position in order to resolve the matter to the satisfaction of Khadi India.
KVIC Chairman V K Saxena, who justified serving the legal notice, referred to the earlier communications with Fabindia by which the private firms application for Khadi mark was treated as closed.
He cited a September 29, 2016 letter which stated that "upon the request of Fabindia, several meetings were held with KVIC and the last meeting was held on August 2, 2016, with Chairman of KVIC at New Delhi. During the meeting, it was assured that Fabindia will communicate their consent shortly.
"Since two months have passed and KVIC has not yet received any response from your end, it is presumed that you are not interested to obtain Khadi mark certificate for sales and promotion of Khadi products.
"Hence in the present circumstances, your application for Khadi mark certificate may please be treated as closed. Henceforth, no correspondence on this subject will be entertained," the communication said.
Saxena also drew attention to a February 16 letter of KVIC in which it was decided to issue Khadi mark certificate in favour of Fabindia to carry out trading/selling of genuine Khadi and Khadi products attaching Khadi mark tags/labels, subject to several conditions which were also mentioned.
KVIC, which is an autonomous body under the Ministry of
KVIC, which is an autonomous body under the Ministry of Micro, Small & Medium Enterprises, had accused
Fabindia of misleading and confusing the consumers by promoting its goods under its registered trade mark Khadi.
In the February 8 legal notice addressed to Fabindias New Delhi-based CEO, KVIC had said "You are called upon to explain your position in the above matter within 15 days from the date of receipt of this notice, failing which the KVIC will be constrained to proceed against your company as per law for the violation of Khadi Mark Regulation and payment or incidental damages for the losses caused to KVIC by Fabindia."
It also said Fabindia was denied the certificate to use the brand name as it did not adhere to the procedural formalities for Khadi mark certification which was discussed with its representatives.
The notice to Fabindia said that as per the Khadi Mark Regulations, 2003 and Khadi & Village Industries Commission Act, 1956 in order to regulate the production, sale or trading of Khadi and Khadi products in India, "no textile shall be sold or otherwise trade by any person or certified Khadi institution as Khadr or Khadi products, in any form or manner without it bearing a Khadi Mark tag or label issued by KVIC".