Hindustan Unilever Limited Vs. Sushil Kumar Sitaldas Dhirani - Court Judgment

1 IN THE HIGH COURT AT CALCUTTA ORDINARY ORIGINAL CIVIL JURISDICTION G.A.1802 of 2016 G.A.1805 of 2016 With C.S.100 of 2016 HINDUSTAN UNILEVER LIMITED -VsSUSHIL KUMAR SITALDAS DHIRANI G.A.1037 of 2016 With C.S.101 of 2016 HINDUSTAN UNILEVER LIMITED -VsNITIN KUKREJ.Before: THE HON’BLE Mr.JUSTICE HARISH TANDON Date: 01/07/2016 Apprearance: Mr.Sudipto Sarkar, Sr.Adv., Mr.Siddhartha Mitra, Sr.Adv., Mr.Ratnanko Banerji, Sr.Adv., Ms.Moushumi Bhattacharya, Mr.D.Gomes, Mr.A.Deb.

….for the Petitioner.

Mr.Ranjan Bachawat, Sr.Adv., Mr.Debnath Ghosh, Mr.Sushanta Dutta, Mr.Chanchal Kumar Dutt, Ms.Krishna Mullick, Mr.Prithwiraj Sinha, Mr.Souvik Mitra.

Mr.Atish Ghosh, Mr.Arindam Chanda … for the Respondents The Court: This bunch of petitions has been taken up together as the common question of law is evolved therein.

A preliminary objection is taken by the respondent over the jurisdiction of this Court to entertain a suit filed by the Hindustan Unilever Limited.

Admittedly the petitioner is incorporated in India having his registered office at Mumbai.

The suits are filed alleging the infringement of trademark and passing off action and in some of the suits the infringement of copyright is also the subject matter.

The point which assumes importance and is a center of debate before me is the interpretation of the judgment rendered by the Supreme Court in case of Indian Performing Rights Society Limited –versus Sanjay Dalia & Anr.

reported in (2015) 10 SCC161 The preliminary objection of the respondent is that Section 134(2) of the Trade Marks Act and Section 62(2) of the Copyright Act should be interpreted harmoniously with Section 20 of the Code of Civil Procedure.

The respondent contends that explanation to Section 20 of the Code of Civil Procedure provides that the suit for can be instituted by a company at its subordinate / branch office provided a part of the cause of action arose within the jurisdiction of that Court.

The aforesaid argument is basically founded on the judgment rendered by the Apex Court in case of Indian Performing Rights Society (Supra) and as per the respondent if none of the cause of action arose within the jurisdiction of this Court, simply because the respondent has a branch office within the jurisdiction of this Court, the suit is not maintainable.

Before proceeding to deal with the point as framed above, it would be relevant to quote the relevant provisions from the Trade Marks Act, Copyright Act and the Code of Civil Procedure which runs thus:“Section 134 of the Trade Marks Act: 134.

Suit for infringement, etc., to be instituted before District Court.----(1) No suit---(a) for the infringement of a registered trade mark; or (b) relating to any right in a registered trade mark; or (c) for passing off arising out of the use by the defendant of any trade mark which is identical with or deceptively similar to the plaintiff’s trade mark, whether registered or unregistered, shall be instituted in any court inferior to a District Court having jurisdiction to try the suit.

(2) For the purpose of clauses (a) and (b) of sub-section (1).a ‘District Court having jurisdiction’ shall, notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908) or any other law for the time being in force, include a District Court within the local limits of whose jurisdiction, at the time of the institution of the suit or other proceeding, the person instituting the suit or proceeding, or, where there are more than one such persons any of them, actually and voluntarily resides or carries on business or personally works for gain.

Explanation.—For the purposes of sub-section (2).‘person’ includes the registered proprietor and the registered user.” Section 62 of the Copyright Act: “62.

(1) (2) Jurisdiction of court over matters arising under this Chapter.--Every suit or other civil proceeding arising under this Chapter in respect of the infringement of copyright in any work or the infringement of any other right conferred by this Act shall be instituted in the District Court having jurisdiction.

For the purpose of sub-section (1).a ‘District Court having jurisdiction’ shall, notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908).or any other law for the time being in force, include a District Court within the local limits of whose jurisdiction, at the time of the institution of the suit or other proceeding, the person instituting the suit or other proceeding or, where there are more than one such persons, any of them actually and voluntarily resides or carries on business or personally works for gain.” Section 20 of the Code of Civil Procedure: “20.

Other suits to be instituted where defendants reside or cause of action arises.—Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction--(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or (b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution; or (c) the cause of action, wholly or in part, arises.

Explanation.--- A corporation shall be deemed to carry on business at its sole or principal office in India or, in respect of any cause of action arising at any place where it has also a subordinate office, at such place.” It would be profitable to narrate the facts involved in the India Performing Rights Society Limited’s case.

The facts as emerged therefrom are that a suit for infringement of a copyright and the trademarks was instituted by the appellant therein in the Original Side of the High Court at Delhi as the branch office is situated at Delhi wherefrom the said appellant is carrying on the business.

Admittedly, the registered office / head office of the appellant was situated at Mumbai and the infringement as alleged therein as well as the entire cause of action arose in Mumbai in the State of Maharashtra.

An argument was advanced before the Supreme Court in view of the provisions contained under Section 134 of the Trade Marks Act and Section 62 of the Copyright Act which provides an additional forum for institution of a suit at a place where the plaintiff actually and voluntarily resides or carries on business or personally works for gain.

It was, therefore, argued therein that because of the nonobstante clause appearing under the aforesaid sections, the applicability of the provisions of Section 20 of the Code of Civil Procedure was impliedly taken away and / or superseded.

In paragraph 18 of the said report the Supreme Court held:“18.

On a due and anxious consideration of the provisions contained in Section 20 CPC, Section 62 of the Copyright Act and Section 134 of the Trade Marks Act, and the object with which the latter provisions have been enacted, it is clear that if a cause of action has arisen wholly or in part, where the plaintiff is residing or having its principal office/carries on business or personally works for gain, the suit can be filed at such place(s).The plaintiff(s) can also institute a suit at a place where he is residing, carrying on business or personally works for gain dehors the fact that the cause of action has not arisen at a place where he / they are residing or any one of them is residing, carries on business or personally works for gain.

However, this right to institute suit at such a place has to be read subject to certain restrictions, such as in case the plaintiff is residing or carrying on business at a particular place/having its head office and at such place cause of action has also arisen wholly or in part, the plaintiff cannot ignore such a place under the guise that he is carrying on business at other far-flung places also.

The very intendment of the insertion of provision in the Copyright Act and the Trade Marks Act is the convenience of the plaintiff.

The rule of convenience of the parties has been given a statutory expression in Section 20 CPC as well.

The interpretation of provisions has to be such which prevents the mischief of causing inconvenience to the parties.” It is further held that where the corporation is having a principal place of business and a cause of action has also arisen at that place the suit has to be instituted at such place and not the other places.

It was ultimately held that the provisions contained under Section 134 of the Trade Marks Act and Section 62 of the Copyright Act cannot be read in isolation with Section 20 of the Code of Civil Procedure and applied the mischief rules in the following words:“25.

Considering the fiRs.aspect of the aforesaid principle, the common law which was existing before the provisions of law were passed was Section 20 CPC.

It did not provide for the plaintiff to institute a suit except in accordance with the provisions contained in Section 20.

The defect in existing law was inconvenience/deterrence caused to the authors suffering from financial constraints on account of having to vindicate their intellectual property rights at a place far away from their residence or the place of their business.

The said mischief or defect in the existing law which did not provide for the plaintiff to sue at a place where he ordinarily resides or carries on business or personally works for gain, was sought to be removed.

Hence, the remedy was provided by incorporating the provisions of Section 62 of the Copyright Act.

The provisions enabled the plaintiff or any of them to file a suit at the aforesaid places.

But if they were residing or carrying on business or personally worked for gain already at such place, where cause of action has arisen, wholly or in part, the said provisions have not provided additional remedy to them to file a suit at a different place.

The said provisions never intended to operate in that field.

The operation of the provisions was limited and their objective was clearly to enable to plaintiff to file a suit at the place where he is ordinarily residing or carrying on business, etc.as enumerated above, not to go away from such places.

The legislature has never intended that the plaintiff should not institute the suit where he ordinarily resides or at its head office or registered office or where he otherwise carries on business or personally works for gain where the cause of action too has arisen and should drag the defendant to a subordinate office or other place of business which is at a far distant place under the guise of the fact that the plaintiff corporation is carrying on business through branch or rightly submitted on behalf of the respondents, the abuse of the provision will take place.

Corporations and big conglomerates, etc.might be having several subordinate offices throughout the country.

Interpretation otherwise would permit them to institute infringement proceedings at a far-flung place and at an unconnected place as compared to a place where the plaintiff is carrying on their business, and at such place, cause of action too has arisen.

In the instant cases, the principal place of business is, admittedly, in Mumbai and the cause of action has also arisen in Mumbai.

Thus, the provisions of Section 62 of the Copyright Act and Section 134 of the Trade Marks Act cannot be interpreted in a manner so as to confer jurisdiction on the Delhi Court in the aforesaid circumstances to entertain such suits.

The Delhi Court would have no territorial jurisdiction to entertain it.”

26. The avoidance of counter-mischief to the defendant is also necessary while giving the remedy to the plaintiff under the provisions in question.

It was never visualised by the lawmakers that both the parties would be made to travel to a distant place in spite of the fact that the plaintiff has a remedy of suing at the place where the cause of action has arisen where he is having head office/carrying on business, etc.The provisions of the Copyright Act and the Trade Marks Act provide for the authors/trade mark holders to sue at their ordinary residence or where they carry on their business.

The said provisions of law never intended to be oppressive to the defendant.

The Parliamentary debate quoted above has to be understood in the manner that suit can be filed where the plaintiff ordinarily resides or carries on business or personally works for gain.

Discussion was to provide remedy to the plaintiff at convenient place; he is not to travel away.

Debate was not to enable the plaintiff to take the defendant to farther place, leaving behind his place of residence/business, etc.The right to remedy given is not unbridled and is subject to the prevention of abuse of the aforesaid provisions, as discussed above.

Parliament never intended that the subject provisions be abused by the plaintiff by instituting suit in wholly unconnected jurisdiction.

In the instant cases, as the principal place of business is at Mumbai the cause of action is also at Mumbai but still the place for suing has been chosen at Delhi.

There may be a case where the plaintiff is carrying on the business at Mumbai and cause of action has arisen in Mumbai.

The plaintiff is having branch offices at Kanyakumari and also at Port Blair, if interpretation suggested by the appellants is acceptable, mischief may be caused by such plaintiff to drag a defendant to Port Blair or Kanyakumari.

The provisions cannot be interpreted in the said manner devoid of the object of the Act.” The Apex Court concluded in the following:“52.

In our opinion, the provisions of Section 62 of the Copyright Act and Section 134 of the Trade Marks Act have to be interpreted in the purposive manner.

No doubt about it that a suit can be filed by the plaintiff at a place where he is residing or carrying on business or personally works for gain.

He need not travel to file a suit to a place where the defendant is residing or cause of action wholly or in part arises.

However, if the plaintiff is residing or carrying on business, etc.at a place where the cause of action, wholly or in part, has also arisen, he has to file a suit at that place, as discussed above.” On a meaningful reading of the observations made by the Supreme Court in the above report, there is no ambiguity that though Section 134 of the Trade Marks Act and Section 62 of the Copyright Act provide a special forum for institution of the suit on infringement of the trademark and the copyright but once the company has both the registered place and the branch office within the jurisdiction of the different Courts then if the cause of action arose within the jurisdiction of any of that Court it would exclude the jurisdiction of the other Court and the suit has to be instituted before the Court where not only the company has the registered office or the branch office but the cause of action has also arisen therein.

The point took another turn when the petitioner advanced his argument and distinguished the judgment rendered in Indian Performing Rights Society (Supra) to the effect that it has no applicability to the chartered High Courts which are governed by the Letters Patent.

In other words, Clause 12 of the Letters Patent does not contain the explanation which is incorporated in Section 20 of the Code of Civil Procedure and therefore the judgment rendered in the above report has no manner of applicability in the instant case.

It is, further, argued that Section 120 of the Code of Civil Procedure excludes the applicability of Section 16, 17 and 20 of the Code to the High Court exercising Ordinary Original Civil Jurisdiction and therefore the judgment relied upon by the respondent should be considered in this context.

To support the submission that Section 120 of the Code of Civil Procedure excludes the applicability of the provisions enumerated therein, the reliance is placed upon the judgment of the Madras High Court in case of Wipro Limited –versus Aushadha Chandrika Ayurvedic India PVT.LTD.reported in 2008 (3) CTC724 It is, thus, contended that the judgment is what is decided in the perspective of the facts involved therein and its applicability is to be seen in the context of the dispute and the applicability of the special statute.

It is undeniable that Clause 12 of the Letters Patent somewhat stands in pari materia with Section 20 of the Code of Civil Procedure but the distinctive features can be noticed because of the absence of an explanation.

A joint committee was constituted to amend and consolidate the law relating to copyrights as many authors were facing immense difficulties in instituting the infringement proceedings to a Court situated at a considerable distance from the place of their ordinary residence.

The joint committee recommends the institution of the infringement proceedings in the District Court within the local limits of whose jurisdiction the person instituting the proceeding ordinarily resides or carries on business.

On such recommendation the Section 62 of the Copyright Act was duly amended which is followed by an amendment under Section 134 of the Trade Marks Act.

The Apex Court in Indian Performing Rights Society (Supra) interpreted the said provisions vis-à-vis Section 20 of the Code of Civil Procedure and held that it is an additional forum which is provided and does not take away in absolute terms the applicability of the provisions contained under Section 20 of the Code.

Admittedly, the Delhi High Court exercising Ordinary Original Civil Jurisdiction are not governed by the Letters Patent which is applicable to the three chartered High Courts namely Calcutta, Bombay and Madras.

The respondent emphasized on a judgment of the Delhi High Court in case of The Foundry Visionmongers LTD.–versus Satyanarayana Reddy S and ORS.reported in (2015) 64 PTC108where the decision of the Supreme Court rendered in case of Indian Performing Rights Society (Supra) was noticed and it is held that if the cause of action wholly or in part have not arisen either in the principal office or at the registered office the suit cannot be instituted at a distant place alleging the infringement of a copyright.

On perusal of the said report, it appears that the jurisdiction was invoked as the reseller of the plaintiff’s product was situated in Delhi and infringement of the copyright was alleged to have taken place therein.

It was ultimately held that the accrual of the cause of action is sine qua non for filing a suit, which is recognized, under Section 20 of the Code.

It was further held that neither the situs of the registered office of the company nor its branch office were at Delhi and merely that the reseller sells its product neither fulfils the criterion enshrined under Section 62 of the Copyright Act nor satisfies the conditions of Section 20 of the Code of Civil Procedure.

The provision of Section 20 of the Code of Civil Procedure was further applied in another decision of the Delhi High Court in case of Ultra Home Construction PVT.LTD.–versus Purushottam Kumar Chaubey & ORS.reported in 2015 (64) PTC119 It is held therein that though Section 62 of the Copyright Act and Section 134 of the Trade Marks Act have somewhat removed the embargo of suing at a place of accrual of cause of action wholly or in part at a place where the plaintiff neither carries on business nor personally works for gain but such right is subject to the rider that if cause of action arose wholly or in part at a place of business of the plaintiff, the suit should be filed at such place and not other place at all.

The aforesaid observations were made on applying the ratio laid down in Indian Performing Rights Society (Supra) case, which cannot be doubted at all.

But a question is still begging an answer whether the ratio laid down in Indian Performing Rights Society (Supra) case and the cases decided by the Delhi High Court as noted above apply to a chartered High Court, which is regulated, guided and controlled by the Letters Patent.

Ancillary to th