Full Text
Date of Decision: 15th November, 2018 CS(COMM) No.1170/2018
NV DISTILLERIES PVT. LTD. .... Plaintiff
Through: Mr. Pradeep Chhindra, Mr. Nikhil Singh & Mr. Parinay T. Vasandani, Advs.
Through: Mr. Mohan Jain, Sr. Adv. with Mr. Chirojit Mukherjee & Ms. Prabhleen Kaur, Advs.
JUDGMENT
1. The applicant / defendant, in this suit for permanent injunction restraining infringement of trade mark, copyright, passing off and for ancillary reliefs seeks, return / rejection of the plaint on the ground of this Court not having territorial jurisdiction to entertain the suit.
2. The senior counsel for the applicant / defendant was heard at length on 30th October, 2018 when this application came up first before this Court. However, on that date, on the request of the senior counsel for the applicant / defendant, the hearing was adjourned to today. Today, the counsel for the plaintiff also appears and the counsels have been further heard.
3. The plaintiff, by this suit seeks to restrain the applicant / defendant from infringing the registered trade mark „CRAZY ROMEO‟ of the plaintiff by marketing the same goods i.e. alcoholic beverages, under the mark 2018:DHC:7284 „CRAZY RIDER‟. The suit came up first before this Court on 8th October, 2018 when, while issuing summons of the suit and notice of the application for interim relief, the applicant / defendant, vide ex parte ad interim order, was restrained from dealing in products with the registered trade mark of the plaintiff „CRAZY ROMEO‟ and / or from dealing in alcoholic beverages bearing the label „CRAZY RIDER‟ or any label deceptively similar to the plaintiff‟s „CRAZY ROMEO‟ label and a commission was also issued to visit the factory premises of the applicant / defendant at district Sonipat, Haryana.
4. The plaintiff, in the memo of parties to the plaint, has given the address of itself as well as of the applicant / defendant at New Delhi. Additional address of the applicant / defendant at district Sonipat, Haryana has also been given. In the plaint, it is pleaded that (i) the registered office of the plaintiff is at New Delhi; (ii) the registered office of the applicant / defendant is at New Delhi; and, (iii) the plaintiff came to know of the infringement when came across the impugned label of the applicant / defendant when the same was filed by the defendant before the Excise Department, Panchkula, Haryana for approval / registration.
5. The plaintiff, in para no.33 of the plaint has pleaded as under:
6. The applicant / defendant, in the application has pleaded that (i) the territorial jurisdiction of this Court has been invoked pleading that the defendant has its registered office at Delhi and that there is a reasonable apprehension that the defendant will launch the product in New Delhi; (ii) till date, the applicant / defendant has not sold the brand in question in Delhi and has no permission from Excise Department to sell the brand / product in question in Delhi; (iii) the applicant / defendant has no intention to sell the goods in question in Delhi, as the applicant / defendant has only the permission from Excise Department, Haryana to sell the goods in question in Haryana; and, (iv) the applicant / defendant has its distillery at District Sonipat, Haryana.
7. The application otherwise runs into 22 odd pages and is full of law and passages from the judgments referred to in the application. However, upon it being pointed out to the senior counsel for the applicant / defendant on 30th October, 2018 that the application is in violation of the law relating to pleadings, he stated that the judgments be ignored and only the pleadings made in the application be read.
8. The senior counsel for the applicant / defendant, on 30th October, 2018 relied on Piccadily Agro Industries Ltd. Vs. Ashok Jain (2017) 241 DLT 424 which in turn relies extensively on Piccadily Agro Industries Ltd. Vs. Ashok Narwal (2016) 229 DLT 604 which was not placed before this Court. Since the applicant / defendant neither in the application nor during the hearing controverted the registered office of the applicant / defendant being situated at Delhi, it was on 30th October, 2018 enquired from the senior counsel for the applicant / defendant, whether not owing to the said fact alone, this Court would have territorial jurisdiction under Section 20 of the CPC which is independent of Section 134 of the Trade Marks Act, 1999 conferring additional territorial jurisdiction with respect to suits for infringement.
9. The senior counsel for the applicant / defendant contended that since no cause of action had accrued to the plaintiff, notwithstanding the registered office of the applicant / defendant being at Delhi, this Court would not have territorial jurisdiction. On enquiry, whether not this Court, under Section 20 of the CPC would have territorial jurisdiction owing to the registered office of the applicant / defendant being at Delhi, even if no cause of action had accrued at Delhi, the senior counsel for the applicant / defendant referred to Patel Roadways Ltd., Bombay Vs. Prasad Trading Company (1991) 4 SCC
270.
10. On 30th October, 2018, it was also the contention of the applicant / defendant that the plaintiff had committed a fraud and a bunch of papers in that regard was handed over in the Court. However, on further enquiry in that regard being made, the senior counsel for the applicant / defendant had sought adjournment and the hearing as aforesaid was adjourned to today.
11. Today, the senior counsel for the applicant / defendant has confined the ground for return / rejection of the plaint to this Court not having territorial jurisdiction and has not pressed the other ground of fraud qua which a compilation of judgments was also handed over during the hearing on 30th October, 2018. Thus, the need to record the said judgments in this order is not felt.
12. The senior counsel for the applicant / defendant pegs his case on Patel Roadways Ltd. supra and argues that Supreme Court therein has on an interpretation of Section 20 of the CPC held that a corporation / company cannot be sued at the address of its registered office, if has a subordinate / branch office elsewhere and where the cause of action has also accrued. It is argued that the plaintiff in the plaint has admitted using the mark / label, of which infringement is claimed, in Haryana and to having its distillery at Ambala in Haryana. It is argued that the cause of action has accrued at Haryana and the defendant, owing to having distillery at Sonipat, Haryana has a subordinate office at Haryana and the suit could have been filed at Haryana only and not at Delhi where though registered office of defendant is but no cause of action has arisen.
13. It is deemed appropriate, at the cost of adding to the length of this judgment, to set out herein below Section 20 of the CPC (without illustrations) as under:-
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." (emphasis added) and the relevant paragraphs of Patel Roadways Ltd. supra as under:
14. As would immediately become clear on a careful reading of the aforesaid, Supreme Court in Patel Roadways Ltd. supra though held the explanation to Section 20 of the CPC to be an explanation to Clause (a) thereof rather than to Clause (c) thereof but was concerned with only the alternative “carries on business”, of the several alternatives in Clause (a). It was not the contention before the Supreme Court in Patel Roadways Ltd. supra that the place where the registered office of a corporation / company is situated is also the place where the corporation, if a defendant in the suit, “actually and voluntarily resides”. Thus, no finding was returned in the said judgment on the said aspect. Supreme Court, in the context only of alternative “carries on business” in Clause (a) of Section 20 having held that by virtue of explanation, which also is only to, where a corporation shall be deemed to carry on business, having held that where a defendant company / corporation has its principal office at one place and subordinate office at another place and cause of action arises at a place where the subordinate office is located, suit has to be filed only in the Court within whose jurisdiction the company / corporation has its subordinate office and not in Court within whose jurisdiction it has its principal office, cannot be held to have also held that notwithstanding the word “or” between the words “actually and voluntarily resides” or “carries on business” or “personally works for gain”, the alternative of suing the corporation at the place where it actually and voluntarily resides is also not available. The judgment cannot be read as eclipsing the option given by the legislature to a plaintiff, under Section 20(a) of the Code, of suing at the place where the defendant, at the time of commencement of the suit, actually and voluntarily resides.
15. I have not come across any judgment holding that in case a defendant is a company or a corporation, only the option in Section 20(a) of the CPC, of “carries on business” is available and not the option of “actually and voluntarily resides”. In Morgan Stanley Mutual Fund Vs. Kartick Das (1994) 4 SCC 225, it was held, as far as India is concerned, the residence of the company is where the registered office is located and normally cases should be filed only where the registered office of the company is situated. Again, in Dhodha House Vs. S.K. Maingi (2006) 9 SCC 41, it was reiterated that ordinarily the residence of the company would be where its registered office is. Once it is so, a company can always be sued under Section 20(a) of the CPC, in the Court within whose jurisdiction the registered office of the company is located. Not only as per the language of the explanation to Section 20 but even as per Patel Roadways Ltd., the explanation to Section 20 is attracted only to the alternative “carries on business” in Section 20(a) and not to the alternative “actually and voluntarily resides”.
16. Mention in this regard may also be made of a dicta of the Division Bench of the High Court of Bombay in Pratap Singh Vs. The Bank of America 1976 SCC OnLine Bom 111, concluding on an interpretation of Clause 12 of the Letters Patent of that Court but at par with Section 20 of the CPC and also referring thereto, that the word „defendant‟ in Section 20 must be given its proper meaning and would include within its compass both natural and artificial persons i.e. living beings as well as corporations and no distinction is made in law between corporations as are incorporated in India and corporations as are incorporated outside India. It was further held that under Section 20, a suit can be brought if the defendant, at the time of institution of the suit, „dwells‟ or „carries on business‟ or „personally works for gain‟ within the limits of the Court and that for consideration of jurisdiction under Section 20(a), the consideration whether the cause of action has accrued wholly or in part within or without the limits of said jurisdiction is wholly irrelevant. Though Clause 12 of the Letters Patent uses the word „dwells‟ instead of „resides‟ but Mulla, in his treatise on the Code of Civil Procedure, 19th Edition, has authored that there is no distinction between the word „resides‟ as used in Sections 16,19 and 20 of the CPC and the word „dwell‟ in Clause 12 of the Letters Patent and the cases decided on the latter word would be authorities on the consideration of the former. Mention, at this stage may be made of Union of India Vs. Sri Ladulal Jain AIR 1963 SC 1681 holding that the principle behind Section 20(a) and Section 20(b) of the CPC is that the suit be instituted at a place where the defendant be able to defend the suit without undue trouble. Applying the said principle also, I fail to see as to how the defendant herein is put to any trouble by being sued in the courts at Delhi within whose jurisdiction the registered office of the defendant is situated. Rather, Supreme Court in Morgan Stanley Mutual Fund supra held that where a corporation is sued with respect to urgent reliefs, as of restraining its public issue, not at the place of the registered office but at the place of its subordinate office, the Court should have regard to the time taken in the subordinate office receiving instructions from the registered office.
17. In this context, it may also be noticed that Patel Roadways Ltd. supra was concerned with challenge by Patel Roadways Ltd. to the jurisdiction of the Courts at Madras, where the subordinate office of the defendant Patel Roadways Ltd., wherein the goods were entrusted to Patel Roadways Ltd. for transportation to Delhi. Patel Roadways Ltd. contested jurisdiction of the Courts at Madras on the plea that as per the agreed terms and conditions of transportation, the exclusive jurisdiction was of the Courts at Bombay where the registered office of Patel Roadways Ltd. was situated. It was in this context held that since Patel Roadways Ltd. had a subordinate office at Madras, the plaintiff situated at Madras could not be compelled to travel to Bombay to sue Patel Roadways Ltd. and by consent jurisdiction could not be conferred on the Courts at Bombay which did not have jurisdiction. Patel Roadways Ltd. supra thus, was not a case where the defendant was sued in Court of the place where registered office of defendant was situated. Though in Piccadily Agro Industries Ltd. Vs. Ashok Narwal supra, the registered office of the defendant no.2, being the manufacturer of the impugned product (defendant no.1 was the agent), was at Delhi but it was not the contention that the defendants therein could be sued at Delhi owing to the defendant no.2, who was the main contesting defendant, actually and voluntarily residing at Delhi on account of having its registered office at Delhi and thus the question as has been adjudicated herein, did not come to be decided. Patel Roadways Ltd. supra was followed, holding that no part of the cause of action had accrued at Delhi. Same was the position in Piccadily Agro Industries Ltd. Vs. Ashok Jain supra.
18. It is a settled position in law that a judgment is not a precedent on what was not for adjudication therein, what was not discussed and debated. The Courts, in Patel Roadways Ltd., Piccadily Agro Industries Ltd. Vs. Ashok Narwal and Piccadily Agro Industries Ltd. Vs. Ashok Jain supra, having not considered the effect of a defendant company being sued in the Court within whose jurisdiction its registered office is situated, though also having a subordinate office at another place and where the cause of action had also accrued, the said judgments do not constitute precedent for the proposition that such a company cannot be sued at the place of its registered office under Section 20(a), owing to actually and voluntarily residing within the jurisdiction of that Court.
19. Mention in addition may also be made of my dicta in Millennium & Copthorne International Ltd. Vs. Aryans Plaza Services Pvt. Ltd. 2018 SCC OnLine Del 8260 against which no appeal is found to have been preferred, holding territorial jurisdiction under Section 19 of the CPC to be also available qua suits for infringement and / or passing off and for ancillary reliefs. The matter having been discussed in detail in the cited judgment, it is not deemed necessary to elaborate.
20. No merit is thus found in the application of the defendant for return / rejection of the plaint.
21. Though I have not found any merit in the application but the contentions of the counsel for the plaintiff made also be noticed.
22. The counsel for the plaintiff argues, that (i) the plaintiff has nowhere in the plaint admitted to the applicant / defendant having subordinate office or branch office at Haryana; (ii) plea, of the applicant / defendant having a distillery at Sonipat in Haryana is not a plea of the applicant / defendant having a subordinate / branch office at Haryana; (iii) Black‟s Law Dictionary defines a „branch bank‟ as an office of a bank physically separated from its main office, with common service and functions, and corporately part of the bank and a branch office of a bank includes office, unit, station, facility, terminal, space or receptacle at a fixed location other than a principal office;
(iv) that a distillery does not qualify as a branch office; (v) that the present suit is in the nature of a quia timet action and the Division Bench of this Court in Allied Blenders & Distillers Pvt. Ltd. Vs. R.K. Distilleries Pvt. Ltd. 2017 SCC OnLine Del 7224 has held that if there is a reasonable and credible apprehension that the impugned product would also be launched and sold in New Delhi, it constitutes a cause of action for instituting a suit in the nature of a quia timet action and the cause of action would accrue at Delhi;
(v) that the Division Bench in Allied Blenders & Distillers Pvt. Ltd. supra has further held that considerations with regard to territorial jurisdiction in the context of Order VII Rule 10 are entirely different from those in the context of an application under Order XXXIX Rules 1 and 2 of the CPC; (vi) in the backdrop of Order VII Rule 10 of the CPC, it is only the averments contained in the plaint that have to be seen; (vii) the averments contained in the plaint in the present suit disclose this Court to be having territorial jurisdiction and the plaint cannot be ordered to be returned on the ground of this Court not having territorial jurisdiction at this stage; (viii) mere denial by the applicant / defendant of not intending to launch its product in Delhi cannot defeat a quia timet action; reliance in this regard is placed on the dicta of the Division Bench of this Court in Teva Pharmaceutical Industries Ltd. Vs. Natco Pharma Ltd. (2014) 210 DLT 591.
23. The senior counsel for the applicant / defendant in rejoinder has contended that there can be no distillery without a branch office.
24. Merit is found in the contentions aforesaid of the counsel for the plaintiff also, to defeat this application for return / rejection of the plaint.
25. I may add, that while the pleading in the application is of the distillery of the defendant at Sonipat, Haryana, the pleading in the plaint is of the distillery of the plaintiff at Ambala, Haryana.
26. The senior counsel for the applicant / defendant has not clarified whether according to the applicant / defendant, the applicant / defendant can be sued under Section 20 of the CPC only at Sonipat, Haryana. Applying Section 134 of the Trade Marks Act and in accordance with the dicta of the Division Bench of this Court in Ultra Home Construction Pvt. Ltd. Vs. Purushottam Kumar Chaubey (2016) 227 DLT 320, the plaintiff, having its registered office at Delhi and distillery at Ambala (if treated to be a subordinate office), would be entitled to sue the defendant at Ambala also and the defendant cannot compel the plaintiff to sue the defendant in the Courts at Sonipat, Haryana only.
27. I am, therefore, of the view that no ground for return / rejection of the plaint is made out.
28. The application is dismissed.
RAJIV SAHAI ENDLAW, J. NOVEMBER 15, 2018/„gsr‟..