Zepto’s parent company, Kiranakart, recently secured a major legal victory in the Delhi High Court, bringing an end to an almost year-long trademark dispute in its favor.
The court ruled in favor of the four-year-old quick commerce startup, directing the removal of the trademark ‘Zepto,’ which had been registered by Mohammad Arshad on July 14, 2014, from the official Trade Marks Register. Zepto had filed a rectification petition seeking the cancellation of Arshad’s mark, arguing that it had been using the name ‘Zepto’ extensively since July 2021 and had built significant brand recognition around it.
In a judgment passed on March 3, Justice Amit Bansal sided with Zepto, noting that the company had continuously and prominently used the ‘Zepto’ trademark since 2021, resulting in strong brand association among consumers. On the contrary, the court observed that Arshad had never commercially used the trademark in the eight years since registering it, weakening his claim.
“The respondent (Arshad) had no genuine intention to use the trademark for the services claimed in the registration. Over eight years have passed since the mark was registered, yet the respondent has failed to put it to any commercial use under Class 35. Therefore, the trademark serves no real purpose and merely occupies space in the Trade Marks Register,” the court stated.
According to court records, Arshad’s ‘Zepto’ was registered under Class 9 and Class 35 for goods and services related to smartphones, phone accessories, computer software, and telephone instruments. However, there was no evidence to suggest that Arshad had used the trademark for any commercial purpose during this period.
Zepto argued that Arshad’s opposition to its trademark application was a deliberate attempt to delay the registration and harass the company. The startup also revealed that Arshad had approached them in July 2024, proposing an out-of-court settlement. However, Zepto rejected the offer after concluding that Arshad was merely trying to extract money under the pretense of an amicable resolution.
In its ruling, the court also noted that Arshad neither filed a response to the rectification petition nor appeared for the hearings, further strengthening Zepto’s case.
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Citing Section 47(1)(b) of the Trade Marks Act, the court highlighted that any registered trademark that remains unused for five consecutive years is liable to be removed from the Register of Trade Marks. Given that Arshad had failed to demonstrate any commercial use of the mark since its registration, the court found merit in Zepto’s plea.
During the hearing, Zepto also presented its business scale to underscore the significance of the trademark. The company revealed that it currently operates around 350 delivery hubs (dark stores) across India, employs over 1,000 full-time professionals, and has a network of 40,000 delivery executives. Zepto also stated that it has processed orders for over 8 million customers in more than 10 cities across the country.
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The startup, which raised $665 million in a funding round last June, had then announced plans to double its dark store count from 350 to 700 by March 2025. However, recent reports suggest that Zepto has already crossed the 900-store mark as of January 2025, surpassing its original target ahead of time. The company is now reportedly aiming to expand its dark store network beyond 1,000 locations in the near future.
In comparison, Zepto’s closest competitor, Blinkit, was operating 1,007 dark stores by the end of the December 2024 quarter. Meanwhile, Swiggy added 96 new dark stores in Q3 FY25, bringing its total count to 705.
Buoyed by its rapid growth, Zepto is now gearing up for a massive public listing. The startup is expected to file for an IPO in the range of $800 million to $1 billion, with roughly $300-400 million worth of shares to be offloaded through an Offer for Sale (OFS) and the remainder raised through new share issuance.
