Uttarakhand High Court
Dr. Shireesh Gupte vs State Of Uttarakhand And Others on 16 March, 2020
Author: Ravindra Maithani
Bench: Ravindra Maithani
Reserved on 14.02.2020
Delivered on 16.03.2020
IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL
Criminal Misc. Application No. 675 of 2012
Dr. Shireesh Gupte ......Petitioner
Vs.
State of Uttarakhand and Others ..... Respondents
Present:- Mr. Abhinav Agnihotri, Advocate for the petitioner.
Mr. T.C. Agrawal, A.G.A. alongwith Ms. Farida Siddiqui, Brief Holder
for the State of Uttarakhand.
Mr. Udyog Shukla, Advocate for respondent no.2.
Hon'ble Ravindra Maithani, J.
The present petition under section 482 of the Code of Criminal Procedure, 1973 (for short 'the Code') has been preferred for quashing the chargesheet as well as the entire proceedings of Case No.2323 of 2012, State Vs. Madan Lal Kankaria and Others, pending in the court of learned Chief Judicial Magistrate, Haridwar (for short 'the case').
2. In the case after receipt of the chargesheets, cognizance was taken and on 03.04.2012, the petitioner and other co-accused have been summoned under sections 479, 481, 482 and 483 IPC and section 63 of Copyright Act, 1957 (for short 'Copyright Act).
3. Brief facts of the case are as hereunder:-
Respondent no.2 filed an FIR on 03.09.2010 against Madan Lal Kankaria and others under sections 479, 481, 482 and 483 IPC and section 63 of Copyright Act. According to it, 2 respondent no.2 is the Managing Director of Indian Herbs Research and Supply Company, Shardanagar, Saharanpur (for short 'the Company') The company entered into an agreement with the petitioner in connection with distribution of the products of the company with the understanding that the composition of the finished products and other information shall be kept secret. The agreement was in existence for a long but thereafter, the petitioner in order to get more profits and to cause damage to the company, under a criminal conspiracy with the co-accused leaked the secret information with regard to composition, etc. and illegally used the property trademark and copyright of the company. He leaked this information to M/s Padmawati Pharmaceuticals Haridwar and also gave the logo of the company to M/s Padmawati Pharmaceuticals.
Respondent no.2 visited the premises of M/s Padmawati Pharmaceuticals. There, they found the products manufactured with the logo of the company. When questioned, it was informed that under the directions of the petitioner, logo is being used. With these and other related averments, FIR was lodged. After investigation, chargesheet has been submitted and proceedings of the case was instituted. The present petition challenges the proceedings of the case.
4. Learned counsel for the petitioner would submit that no offence has been made out; there has been no intention of the petitioner to cheat. The following points have also been raised by learned counsel in his arguments:-
(i) Petitioner applied for a logo under the Copyright Act. 3
(ii) The trademark registry informed that the logo has not been registered in any other name under the Trade marks Act, 1994 (for short 'The Trademark Act')
(iii) Petitioner runs his business in Austria, where his logo is registered.
(iv) Respondent no.2 filed objection with the Austrian Authority which indicate that the dispute is civil in nature.
5. It is argued that in the agreement, there is an arbitration clause. Respondent no.2 could have invoked the arbitration clause; there is no element of criminality.
6. Learned counsel for the petitioner would submit that the proceeding of the case deserves to be quashed. In support of his contention, learned counsel placed reliance on the principles of law as laid down in the case of Hridaya Rangan Pd. Verma and Others Vs. State of Bihar and Another, (2000) 2 SCR 859. In this case, Hon'ble Supreme Court, inter alia, held as hereunder:-
"In determining the question it has to be kept in mind that the distinction between mere breach of contract and the offence of cheating is a fine one. It depends upon the intention of the accused at the time to inducement which may be judged by his subsequent conduct but for this subsequent conduct is not the sole test. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction that is the time when the offence is said to have been committed. Therefore it is the intention which is the gist of the offence. To hold a person guilty of cheating it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise. From his mere failure to keep up promise subsequently such a culpable 4 intention right at the beginning, that is, when he made the promise cannot be presumed."
7. On the other hand, learned counsel for respondent no.2 would submit that the logo of the company has been registered with Copyright Authorities and the life of logo under section 22 of the Copyright Act is for the lifetime, which still exists. Petitioner was never given a logo as applied by him. The search certificate given by Trademark Authority has no effect because the logo registered by the company has been registered with the Copyright Authorities.
8. According to learned counsel, it is not a dispute of civil nature. It is an offence committed by the petitioner. Earlier, the petitioner was allowed by the company to use the logo of the company, but, once the agreement discontinued, this permission was also revoked by the company. Despite that, it is argued that the petitioner used the logo of the company and leaked the secret information to the M/s Padmawati Pharmaceuticals. It is argued that no interference is warranted and the petition deserves to be dismissed.
9. It is true that every breach of contract does not give rise to criminal prosecution. The intention since inception is material. But, here is a case with regard to infringement of copyright. The principles of law as laid down in the case of Hriday Rangan (supra) relates to the offence under section 420 IPC. One 5 of the essentials ingredients of section 420 IPC is dishonest intention.
10. The instant petition is filed under section 482 of the Code. The jurisdiction of section 482 of the Code is too wide but guided with principles as laid down in various cases including in the cases of R.P. Kapoor Vs. State of Punjab, AIR 1960 Supreme Court 866, State of Haryana and Others Vs. Bhajan Lal and Others, 1992 Supp (1) SCC 335, Amit Kapoor v. Ramesh Chander, (2012) 9 SCC 460 and Rajiv Thapar and Others Vs. Madan Lal Kapoor, (2013) 3 SCC 330. Undoubtedly, if, prima facie, no case is made out, the court may under section 482 of the Code make an interference. Similarly, if the matter is essentially civil in nature without any element of criminality, in such situation also, an interference under section 482 of the Code is warranted.
11. In the case of Sushil Sethi and Another Vs. State of Arunachal Pradesh and Others, 2020 SCC OnLine SC 115, Hon'ble Supreme Court referred to various judgments, on the subject, to uphold that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception.
12. In the case of Amit Kapoor (supra), Hon'ble Supreme Court elaborated principles qua "civil wrong" and "criminality" that may be considered by the High Court while exercising the jurisdiction under Section 482 of the Code. It was, 6 inter alia, held that "where the allegations made and as they appeared from the record and documents annexed therewith to predominantly give rise and constitute a "civil wrong" with no "element of criminality" and does not satisfy the basic ingredients of a criminal offence, the court may be justified in quashing the charge" (Para 27.8).
13. In the instant case, petitioner is not chargesheeted under section 420 IPC. The question of intention to that extent may not be relevant. The petitioner is chargesheeted for the offence punishable under section 63 of the Copyright Act also, which provides punishment for infringement of copyright. This section 63 reads as hereunder:-
63. Offence of infringement of copyright or other rights conferred by this Act.--Any person who knowingly infringes or abets the infringement of--
(a) the copyright in a work, or
(b) any other right conferred by this Act, except the right conferred by section 53A shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to three years and with fine which shall not be less than fifty thousand rupees but which may extend to two lakh rupees:
Provided that where the infringement has not been made for gain in the course of trade or business the court may, for adequate and special reasons to be mentioned in the judgment, impose a sentence of imprisonment for a term of less than six months or a fine of less than fifty thousand rupees.7
Explanation.--Construction of a building or other structure which infringes or which, if completed, would infringe the copyright in some other work shall not be an offence under this section.
14. Copyright has been elaborated under section 14 of the Copyright Act. It is the case of respondent no.2 that their logo has been registered with the Copyright Authorities. They have filed the registration given by Copyright Authorities on 28.01.1991. According to it, the work is artistic. The 'artistic work' has further been defined under section 2 (c) of the Copyright Act, which reads as hereunder:-
2. Interpretation.- .............................................................................
................................................................................. ..................................................................................
"(c) "artistic work" means,--
(i) a painting, a sculpture, a drawing (including a diagram, map, chart or plan), an engraving or a photograph, whether or not any such work possesses artistic quality;
(ii) a work of architecture; and
(iii) any other work of artistic craftsmanship;"
15. It is a case of petitioner himself that he had entered into an agreement with the company. The agreement have been filed which reveals that the company had authorized the petitioner to use the trademark of the company. Although, this agreement has now expired. It is further the case of respondent no.2 that after revocation of the permission, the petitioner continued to use the logo and he shared it with M/s Padmawati Pharmaceuticals, Haridwar. In the petition itself, in paragraph 12, petitioner has admitted that he sent some purchase order to M/s Padmawati 8 Pharmaceuticals and also sent logo to it. These are Annexure Nos.5 and 6. Prima facie, it is apparent that the logo of the company which was registered with the Copyright Authorities was sent by the petitioner to M/s Padmawati Pharmaceuticals for its use.
16. On behalf of the petitioner, it is argued that he had applied for logo and in a search certificate issued by Trademark Authorities on 23.02.2011, it was informed that the company's logo was not registered with the trademark authorities. It is not the case of respondent no.2 that their logo was registered with the Trademark Authority. Their logo was registered with Copyright Authorities.
17. When registration of logo is applied to the Copyright Authorities, under section 45 of the Copyright Act, a search is made with the Trademark Authorities. This is what happened in petitioner's case, but, it does not mean that petitioner's logo was registered. Mere apply for logo does not give any right to the petitioner to use the logo. The petitioner knew that the logo which he applied for registration with Copyright Authorities had already been registered in the name of the Company. Company had earlier authorized to use this logo and subsequently revoked this permission
18. The logo which the petitioner shared with the M/s Padmawati Pharmaceuticals is the logo of the company. The logo which is registered in the name of petitioner in Austria is annexure 1 to the petition. It is a different logo. It has nothing to do with the 9 logo registered in the name of the company, which the petitioner admittedly shared with the M/s Padmavati Pharmaceuticals. Registration of any logo in the name of the petitioner in Austria does not have any bearing in the case. Even if any objections are filed by the company with the Austrian Authorities, it also does not absolve the petitioner of any criminal liability that may arise under section 63 of the Copyright Act.
19. Argument has been advanced that there is an arbitration clause in the agreement. This argument is devoid of merits for two reasons namely (1) There is no agreement in force between the parties when the alleged offence was committed and (2) If any criminal offence is committed, it is definitely beyond the scope of any Arbitration.
20. It is true that civil remedies are also available for infringement of copyright and they are enumerated under chapter 11 of the Copyright Act. But, that does not mean that criminal prosecution may not be launched under section 63 of the Copyright Act.
21. The FIR in the instant case, prima facie, made out a case under section 63 of the Copyright Act. The Investigating Officer after investigation has submitted the chargesheet. The chargesheet has been submitted under section 63 of the Copyright Act and sections 479, 481 and 483 IPC. Section 497 IPC defines property mark. Section 481 IPC defines as to what is the use of false property mark. Section 482 IPC provides for punishment for 10 using of false property mark. Section 483 IPC relates to counterfeiting a property mark used by another. The case is that the logo was infringed. In the instant case, prima facie, case under section 63 of the Copyright Act and sections 482, 483 IPC is made out. But, there is no question of any case having been made out under sections 479 and 481 IPC because they are definitions. This aspect may be further seen in the trial of the case.
22. In view of the foregoing discussion, this Court is of the view that there is no reason to make any interference under Section 482 of the Code. Accordingly, the petition deserves to be dismissed.
23. The petition is dismissed with the observation as made hereinabove.
(Ravindra Maithani, J.) Ujjwal