Overview

Under the Designs Act 2001, a design refers to the appearance of an object. And it can be the shape, pattern, colors, or how it is assembled. It refers to things that you can physically feel, like 2-D or 3-D objects, and you can manufacture them in a plant, or you can make them with machinery, with hands, or with chemicals. The end goal of the final product: if it’s designed (visually) well enough, you should be able to see what its design is like by just using your eyes. But it does not cover things that are all about how they work, such as machines. 

How design registration process in India works: It is a means of protecting a new design that has been applied to an object manufactured in a factory. This prevents other people from creating counterfeit copies of it. When you register a design, you acquire a right to use it for 10 years, which you can renew for another five years. 

Benefits of Design Registration:

• Legal Right to Sue 

A registered design gives the proprietor the right to sue against anyone copying or imitating their design. This protects the uniqueness of this product and prevents counterfeiting production as a design filing in India. 

• Long-Term Protection 

A registered design is valid for 10 years and can be further renewed for an additional 5 years. 

• Protection from Copying 

Design registration in India is given legal protection for businesses from getting computerized. No other company may copy, sell, or create a design that replicates it. 

• Increased Market Value 

A recorded design adds business value to the product, as it stands out to customers and investors through top design filing in India. 

• Fair Competition 

This registrable right to exclusivity encourages fair competition and promotes new innovation by safeguarding distinctive designs. 

• Customer Appeal 

The appeal of a product to a customer is derived from its physical appearance, and this is where design registration helps in ensuring that a product is visually distinct and unique. 

• Profitable Investment 

Being a top design registration in India as a Services plus, aesthetics in a way that protects their design from copied competitors, an intangible asset can help businesses increase revenue and achieve a strong return on the overall investment. 

• Market Differentiation 

An official design registration makes a product look different from competitors, providing an additional advantage to the owner. 

• Licensing Opportunity 

And owners can license this design to other manufacturers and receive royalties that lead to step changes in business profit. 

Requirements for Design Registration in India:

• Must Be New and Unique 

The design must be new and should never have been applied for registration or appeared anywhere before the design registration process in India. 

• Clearly Different from Others 

It must not be a reproduction of a design in existence or new designs made from a design we already know. 

• No Offensive Content 

Your design cannot have any scandalous, obscene, or indecent elements. 

• Not an Invention Just for Function 

It has to be aesthetically valuable, not technical or mechanistic, according to the design registration company in India. 

• Applied to a Physical Object 

The design should mean something applied to an existing product that people can recognize and see. 

• Should Follow Public Ethics 

It should not be contrary to public morals, public order, or public policy. 

As a result, it becomes vital to polish any innovative work, heighten the market worth, and assure the prolonged existence of a business through design registration company in India.  

Tax & Process:

1. Application Fees and GST: 

• A statutory fee is paid to the Controller General of Patents, Designs, and Trademarks (CGPDTM) while applying for a design registration process in India. 

• This fee is liable to GST (Goods and Services Tax) at a rate of 18% (rate may vary depending on government). 

• The applicant must keep appropriate invoices and receipts for GST compliance purposes. 

1. Income Tax Treatment: 

• For Businesses: Design registration can be accounted for as a capital expenditure if it provides a long-term benefit to the business. 

• For Individuals: If this design is registered to you for your own use (and not your business creating it), no tax benefits are offered. 

1. The Impact of Design Registration on Depreciation: 

• Thus, registered designs are considered intangible assets under Section 32 of the Income Tax Act, 1961. 

• If the design is used for generating revenue, businesses can claim depreciation at 25% on the cost of design through companies as top design registration in India. 

1. Eligibility for GST Input Tax Credit (ITC): 

• If the business to which the design is available (i.e. the "design registrant") pays GST on design registration fees, it may claim input tax credit ("ITC") (GSTR-3A) provided it uses them to promote the best services in the business. 

• ITC can only be claimed for business-relevant designs. ITC cannot be claimed for studio designs used for personal and non-taxable supplies. 

1. Royalty and Taxation: 

• In case a registered design is licensed to a third party for commercial purposes the royalty receipts are taxable under Income from Other Sources or Business Income, depending on the nature of the business. 

• Section 194J of the Income Tax Act may impose TDS (Tax Deducted at Source) at 10% on royalty payments. 

1. Renewal Fees and Tax Write-off: 

When, after 10 years, a business renews its design registration, the cost of any renewal fees can also be deducted as a business expense. 

 Documents for Design Registration:

For a design registration process in India, the documents you will need to submit include: 

1. Application Form (Form 1) 

Preparing Form 1 as per Schedule II of the Designs Rules. 

2. Design Representations 

These shall also be submitted as duplicate representations of the design per Rules 12, 13, and 14 through a design registration company in India for clarity. 

3. Authorization Documents 

• In case of applying through a patent agent/lawyer, in the original power of attorney (Form-21). 

• Use a copy of the General Power of Authority (GPA) and indicate the design application number (to match the GPA), if applicable. 

4. Small Entity Status (if applicable) 

For applying as a small entity, submit Form-24 along with proof of MSME registration under the Act, 2006 (for Indian applicants). 

5. Documents for Foreign Applicants  

• Affidavit (Rule 42): According to Rule 42, foreign applicants are required to submit an affidavit to verify their claim. 

• Priority Document (Rule 15): If claiming priority to a foreign application, also submit the original priority document. 

• Translation: In case the priority document is not in English, attach the authenticated translation. 

• Assignment Document: Original assignment document to prove ownership transfer (if the original foreign applicant does not match the name of the Indian applicant).