Gujarat High Court
Vimal Electric Company & vs Vimal Agro Products Pvt Ltd on 25 April, 2017
Bench: M.R. Shah, B.N. Karia
C/AO/422/2016 CAV JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
APPEAL FROM ORDER NO. 422 of 2016
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE M.R. SHAH sd/
and
HONOURABLE MR.JUSTICE B.N. KARIA sd/
=========================================
1 Whether Reporters of Local Papers may be allowed to see NO the judgment ?
2 To be referred to the Reporter or not ? NO
3 Whether their Lordships wish to see the fair copy of the NO
judgment ?
4 Whether this case involves a substantial question of law as NO
to the interpretation of the Constitution of India or any order made thereunder ?
============================================= VIMAL ELECTRIC COMPANY & 1....Appellant(s) Versus VIMAL AGRO PRODUCTS PVT LTD....Respondent(s) ============================================= Appearance:
MR RR SHAH, ADVOCATE for the Appellant(s) No. 1 2 MR KALPESH C PATEL, ADVOCATE for the Respondent(s) No. 1 ============================================= CORAM: HONOURABLE MR.JUSTICE M.R. SHAH and HONOURABLE MR.JUSTICE B.N. KARIA Date : 25/04/2017 CAV JUDGMENT (PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1.0. Feeling aggrieved and dissatisfied with the impugned order passed by the learned Judge, Commercial Court, Ahmedabad passed below Exh.21 in Commercial Civil Suit No. 155 of 2016 (old Civil Suit No. 272 of 2015), by which, the learned Commercial Court has allowed the said application preferred by the respondent herein original defendant and has ordered to return the plaint Page 1 of 29 HC-NIC Page 1 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT along with all the documents appended to it to the plaintiffs to present the same before the appropriate and competent Court having jurisdiction to try, entertain and dispose of the same, the original plaintiffs have preferred present Appeal From Order.
2.0. The facts leading to the present Appeal From Order in nutshell are as under:
2.1. That the appellants herein original plaintiffs have instituted Civil Suit No. 272 of 2015 in the City Civil Court at Ahmedabad for passing off action and has prayed for the following reliefs in the suit.
"[A] The Hon'ble Court be pleased to declare that the plaintiffs are the owner and proprietor under the trading name and style containing or consisting of word VIMAL and that no other person, firm or company is entitled to use the trade name or trading style containing or consisting of word VIMAL for ready to eat products or any other business.
[B] The defendants, their servants, agents, dealers, distributors etc. be restrained by an order of permanent injunction from manufacturing and marketing and advertising their goods under the trade name / trade mark / corporate name VIMAL, or any other identical and/or deceptively similar trade name / trade mark /corporate name which may be identical and/or deceptively similar to the various trading styles of the plaintiffs' group VIMAL GROUP containing the word VIMAL in respect of their various business activities, and thereby restrain them from committing act of passing off.
[C] The Hon'ble Court be pleased to direct the defendants to hand over all stocks of packing materials, advertising materials, blocks, stationary, articles etc. bearing or containing the objected trading Page 2 of 29 HC-NIC Page 2 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT style and/or corporate name containing VIMAL key word of VIMAL AGRO PRODUCTS PVT. LTD., destruction to the plaintiffs.
[D] The Hon'ble Court be pleased to direct the defendants to pay Rs.20,00,00,000=00 [Rupees Twenty crore only] towards and by way of damages or in alternate to render true and correct account of their business activities under the name and style of VIMAL AGRO PRODUCTS PVT. LTD., and /or or any other firm /company having VIMAL key word in its name, if any after verifying the books of accounts and ascertaining the illegal and unlawful profit made by the defendants be directed to pay the same to the plaintiff with 18% interest from the date of the suit till payment or realization.
[E] The Hon'ble Court be further pleased to order the defendants to pay costs of this litigation to the plaintiffs.
[F] Any other and further relief that may be deemed fit and proper be granted in favour of the plaintiffs."
2.2. That in the said suit/ plaint, in para 31, the plaintiffs have pleaded cause of action as under:
"31. Cause of action: That the cause of action to file the present suit firstly has arisen when the defendants have filed opposition proceedings to plaintiffs' registration application somewhere in July, August, 2014 and thereafter in the last week of November, 2014 when the plaintiffs inquired through their field staff as to whether which goods are manufactured and marketed by the defendants. Further, the cause of action has arisen when the plaintiffs came across the defendants' ready to eat products in the market. Further, the cause of action has arisen when the plaintiffs have issued cease and desist notice dated 05.12.2014 to the defendants and when the acknowledgment receipt slip was received under the rubber stamp of the defendants. Further, the cause of action has arisen when the defendants have chosen to give evasive reply to the notice dated 05.12.2014 issued Page 3 of 29 HC-NIC Page 3 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT by the plaintiffs and as and when the copy of the caveat application is received by the plaintiffs in the third week of December, 2014. The plaintiffs have got knowledge that the defendants are carrying the business in the city of Ahmedabad and the cause of action has arisen within the territorial jurisdiction of this Hon'ble Court. It is further submitted that the defendants' goods are sold in the territorial jurisdiction of this Hon'ble Court and the plaintiffs have purchased the defendants goods in the city of Ahmedabad vide cash memo Nos.2413 dated 19012015 from Alka Stores, Ahmedabad for Rs.730/and vide cash memo Nos.42 dated 09012015 from Shree Krushan Dudh Ghar, Ahmedabad for Rs.235/which is produced separately with the list. The plaintiffs are also carrying on their business at Mehsana, Ahmedabad and elsewhere in different cities in country and the plaintiffs' goods are also available in the city of Ahmedabad. The defendants are manufacturing and marketing their products under the trade name /trade mark VIMAl in a clandestine and surreptitiously manner and as such the cause of action is continuous and subsisting against the defendants from day to day till the defendants are restrained from using the key word VIMAL by an order of this Hon'ble Court. Moreover, the defendants have also passed off plaintiffs' VIMAL trade mark/ trade name by using the same or deceptively similar trade name/trading style and guilty of passing off plaintiffs' trade mark/ trade name VIMAL under section 34 of the Trade Marks Act, 1999 and also under section 20 of the Code of Civil Procedure, 1908. The plaintiffs say that the cause of action has also arised on 03012015 when the website of the defendant came to be known by the plaintiff no.2 when the reply at 27122014 was received by the plaintiffs on 08012015 and photocopy of the said website was taken out on 09012015. The plaintiffs say that the cause of action is continuous and recurring day by day."
2.3. That having served with the notice of the suit, original defendants submitted the application Exh.21 under Order 7 Rule 10 of the Code of Civil Procedure r/w Section 151 of the Code of Page 4 of 29 HC-NIC Page 4 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT Civil Procedure with a prayer to return the plaint to the plaintiff's to present it before the appropriate Court having jurisdiction to grant such relief, contending inter alia that City Civil Court at Ahmedabad has no territorial jurisdiction to grant the reliefs as prayed in the suit, by further submitting that as such no cause of action has arisen within the territorial jurisdiction of the City Civil Court at Ahmedabad. That thereafter, on establishment of Commercial Court at Ahmedabad, the aforesaid Civil Suit No.272 of 2015 has been transferred to the Commercial Court at Ahmedabad, which is numbered as Commercial Civil Suit No. 155 of 2016.
2.4. That it was the case on behalf of the defendant that the defendant does not carry out its business within the territorial jurisdiction of Court at Ahmedabad nor have any office or any other representatives or agents within the territorial jurisdiction the Court at Ahmedabad and therefore, for the relief sought in the plaint / suit, Court at Ahmedabad has no territorial jurisdiction. It was submitted that even in the plaint also, the plaintiff's also averred that "the defendant carries on business at Bardoli" which is beyond the territorial jurisdiction of the Court at Ahmedabad. It was also submitted that even the plaintiff's have not appointed any wholesaler, distributor or retailer for and on its behalf to carry on its business, nor has made any commercial sale or enter into any such transactions of supplying any goods to any such seller, distributor or retailer as averred and pleaded by the plaintiffs within the territorial jurisdiction of the Court at Ahmedabad. It was further submitted that even defendant has not entered into Page 5 of 29 HC-NIC Page 5 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT any such transaction with any of the distributor in the city, more particularly, Alka Stores and Shree Krushna Dudh Ghar in respect of the products in question. It was further the case on behalf of the defendant that the plaintiff's are not having any business and / or had not entered into transactions with any non parties as their representative, as the invoices produced by the plaintiffs are false and concocted. It was submitted that even the name of the defendant has been inserted in the invoices subsequently only with a view to bring the suit within the territorial jurisdiction of the Ahmedabad Court. It was submitted that even considering the pleadings and averments made by the plaintiffs, it is not the case of infringement of trade mark, copyright, patents etc. and that it is merely a case of passing off, and therefore, neither provisions of Section 134 of the Trade Marks Act nor Section 64 of the Copyright Act would apply. It was submitted that even considering the provisions of Section 20 of the Code of Civil Procedure, the cause of action cannot be said to have arisen within the territorial jurisdiction of the Court at Ahmedabad, as the defendant has not sold, nor having any retailer, nor carrying on business, nor having any registered office at Ahmedabad within the territorial jurisdiction of the Court at Ahmedabad and that essential characteristics of the business such as i.e. manufacture, packaging, dispatch, sales, receipt of orders, all admittedly take place at Bardoli district and therefore, no cause of action is said to have arisen within the jurisdiction of the Court at Ahmedabad. Therefore, it was requested to allow the application Exh. 21 and to return the plaint to the plaintiffs to present it before the appropriate Court having jurisdiction to grant such relief.
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2.5. The application Exh.21 was vehemently opposed by the plaintiffs. It was the specific case on behalf of the plaintiffs that as the suit filed by the plaintiffs is suit for passing off action and as the defendant's goods are being sold in the city of Ahmedabad, the Court at Ahmedabad would have jurisdiction to try and decide the suit and grant the relief as prayed in the suit. For the aforesaid, the plaintiffs relied upon two cash memos one issued by the Alka Stores and another by Shree Krushna Dudh Ghar (Non Parties at Ahmedabad). Therefore, it was submitted that in view of provisions of Section 134 of the Trade Marks and Section 20 of the Code of Civil Procedure, a part of cause of action is said to have arisen within the jurisdiction of Court at Ahmedabad and therefore, the Court at Ahmedabad would have jurisdiction to try the suit.
2.6. That after considering the rival submissions made by the learned advocates for the respective parties, by impugned order, learned Commercial Court has allowed the said application Exh.21 and has held that for the reliefs prayed / sought in the suit, the Court at Ahmedabda / Commercial Court, Ahmedabad would not have any territorial jurisdiction and therefore, by impugned order has returned the plaint to the plaintiffs to present it before the appropriate Court having jurisdiction to grant such relief.
2.7. Feeling aggrieved and dissatisfied with the impugned order passed by the learned Commercial Court, Ahmedabad in returning the plaint to the plaintiffs to present it before the Court having jurisdiction to grant reliefs prayed in the suit, by holding that for the reliefs sought in the plaint / suit, the Commercial Page 7 of 29 HC-NIC Page 7 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT Court, Ahmedabad shall not have any territorial jurisdiction, original plaintiffs have preferred the present Appeal From Order.
3.0. Shri R.R. Shah, learned advocate has appeared on behalf of the original plaintiffs and Shri Mitul Shelat, learned advocate has appeared on behalf of the original defendant.
4.0. Shri R.R. Shah, learned advocate for the original plaintiffs has vehemently submitted that in the facts and circumstances of the case the learned Commercial Court has materially erred in allowing the application Exh.21 submitted under Order 7 Rule 10 of the Code of Civil Procedure and in observing that Court at Ahmedabad would not have any territorial jurisdiction to grant relief sought / prayed in the suit.
4.1. Shri R.R. Shah, learned advocate for the original plaintiffs has vehemently submitted that while holding that the Court at Ahmedabad would not have any territorial jurisdiction to grant the relief prayed in the suit, the learned Judge has not properly appreciated the cause of action pleaded in the suit/ plaint.
4.2. It is further submitted by Shri R.R. Shah, learned advocate for the original plaintiff's that as the goods of the defendant are / were being sold in the city of Ahmedabad and as the suit was for passing off action the Court within whose jurisdiction the goods of the defendants are being sold, the suit for passing off action would be maintainable. In support of his above submissions, Shri Shah, learned advocate for the original plaintiffs Page 8 of 29 HC-NIC Page 8 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT has heavily relied upon the decision of the learned Single Judge of this Court in the case of Pam Pharmaceuticals vs. Richardson Vicks Inc & Ors reported in 2001(1) GLR 125 as well as in the case of Unilever PLC & Anr vs. Vesco Laboratories reported in AIR 2010 Gujarat 8. It is submitted that as held by this Court in the aforesaid decisions for passing off action wherever the goods are being sold which are deceptively similar to that of plaintiff, that Court has jurisdiction to entertain the suit, as it can be said that for passing off action, the cause of action has arisen within the territorial jurisdiction of that Court where the goods are being sold.
4.3. It is further submitted that in the present case in support of the case on behalf of the plaintiffs that goods manufactured by the defendant which are deceptively similar to that of the plaintiffs are being sold in the city of Ahmedabad, the plaintiffs have produced the necessary evidence such as cash memo, invoice etc. of Alka Stores and Shree Krushna Dudh Ghar (non parties). It is submitted that the necessary averments to that effect is also made in the plaint. It is submitted that while considering the application under Order 7 Rule 10 / Order 7 Rule 11 of the Code of Civil Procedure , at that stage only the averments made in the plaint alone are required to be considered. In support of his above submissions, Shri Shah, learned advocate for the plaintiffs has heavily relied upon the decision of the Hon'ble Supreme Court in the case of Saleembhai and others vs. State of Maharashtra and others reported in AIR 2003 SC 759.
4.4. It is further submitted by Shri Shah, learned advocate Page 9 of 29 HC-NIC Page 9 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT for the original plaintiffs that even otherwise in view of change circumstances of establishment of Commercial Court, Ahmedabad and as the registered office of the plaintiffs is at Mehsana and / or near the city of Ahmedabad and that the Commercial Court, Ahmedabad would have territorial jurisdiction considering Section 134 of the Trade Marks Act, even otherwise the Commercial Court, Ahmedabad would have territorial jurisdiction now to grant relief prayed in the suit.
Making above submissions and relying upon the above decisions, it is requested to allow the present Appeal From Order.
5.0. Present Appeal From Order is vehemently opposed by Shri Mitul Shelat, learned advocate for the original defendant. It is submitted that in the facts and circumstances of the case and more particularly, when even it is alleged by the defendant that cash memo / invoices of the non parties are forged and fabricated and that the defendant is not carrying on any business in the city of Ahmedabad as alleged and that the defendant has no business connection with the non parties, the learned Commercial Court has rightly allowed the application Exh.21 and has rightly held that the Court at Ahmedabad would not have any territorial jurisdiction to grant the relief as prayed in the suit and therefore, has rightly returned the plaint to the plaintiffs to present it before the appropriate Court having jurisdiction.
5.1. Shri Shelat, learned advocate for the defendant has requested to consider the following facts while considering the Page 10 of 29 HC-NIC Page 10 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT impugned order passed by the learned Commercial Court.
(i). That the original plaintiffs Vimal Electric Company is carrying on the business of electronic appliances which claims to have commenced in the year 1972 and original plaintiff no.2 Vimal Oil and Foods Ltd which claims to be registered as a Company on 14.5.1994.
That the plaintiffs have registered office situated at Mehsana. That the plaintiffs have registered label and word mark containing the words Vimal in clause 29 and 30.
(ii). That the defendant is a company who started its business of Rice Mill in the year 1975. It was incorporated as a company on 14.10.1988 and is carrying on the business of manufacturing, marketing, exporting and selling various food items. That the defendant has its registered office at Bardoli and has obtained various certificate, license under various laws at Bardoli. That defendant is the registered proprietor of the word mark Vimal in Class, 29, 30, 31 and 32 of the Trade Marks Act as well as label containing the word Vimal.
5.2. It is further submitted by Shri Shelat, learned advocate for the original defendant that original plaintiffs have instituted the suit within the territorial jurisdiction the Commercial Court at Ahmedabad considering Section 134 of the Trade Marks Act and Section 20 of the Code of Civil Procedure. It is submitted that provisions of Section 134 of the Trade Marks Act shall not be Page 11 of 29 HC-NIC Page 11 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT applicable in the present case as the suit filed by the plaintiffs is not for infringement of trade mark, but for passing off action and the remedy against passing off is available only under common law and territorial jurisdiction is to be considered in accordance with Section 20 of the Civil Procedure Code, 1908. In support of his above submission, Shri Shelat, learned advocate for the defendant has relied upon the decision of the Delhi High Court in the case of Heinz India Pvt Ltd vs. Shrejee Remedies reported in 2013(55) PTC 542(Delhi).
5.3. It is further submitted by Shri Shelat, learned advocate for the defendant that in the present case the plaintiffs have invoked the jurisdiction of the Court / Commercial Court, Ahmedabad by referring to the following causes in the plaint:
i. Opposition to the Registration of their TradeMark. ii. Receipt of acknowledgment of their cease and desist notice.
iii. Receipt of caveat application iv. Website of the respondent.
v. Purchase of defendants goods in the city of Ahmedabad.
5.4. It is submitted that it is an established law that the filing of an application for registration or objection thereof, does constitute cause of action for conferring the territorial jurisdiction in a suit for passing off. In support of his above submission, he has relied upon the following decisions of the Hon'ble Supreme Court as well as Madras High Court and Delhi High Court.Page 12 of 29
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1. Austin Reed Limited vs. Suntex Garments Others reported in 2007 (35) PTC 774 (Mad).
2. Premier Distilleries Pvt Ltd vs. Sushi Distilleries reported in 2001 (21) PTC 907 (Mad)
3. M/s. Lakhan Pal Shyam Kumar vs. Ram Prasad Gupta & Anr reported in 2012(51) PTC 141 (Del)
4. Dhodha House & Patel Field Marshal Industries vs. S.K. Maingi & P.M Diesel Limited reported in AIR 2006 SC 730. 5.5. It is further submitted by Shri Shelat, learned advocate for the defendant that even receipt of the notice within the jurisdiction of the Court would not ipso facto give rise to a cause of action for invoking the territorial jurisdiction of the Court. It is submitted that in the present case, it is not even the receipt of notice but (1) receipt of acknowledgment of service of notice and (2) receipt of caveat application filed by the respondent. It is submitted that none of the above two facts give rise to any cause of action for filing of the suit. In support of his above submissions, Shri Shelat, learned advocate has relied upon the decision of the Hon'ble Supreme Court in the case of Oil and Natural Gas Commission vs. Utpal Kumar Basu and ors reported in (1994) 4 SCC 711.
5.6. It is further submitted by Shri Shelat, learned advocate for the original defendant that in order to show that some part of the cause of action has arisen in the forum State, the plaintiffs are required to show that the defendant website targeted the viewers in Page 13 of 29 HC-NIC Page 13 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT the forum state and prima facie show any commercial transaction taken place as a result. It is submitted that in the present case no such pleadings exist to plead cause of action on the said ground. In support of his above submission, Shri Shelat, learned advocate for the defendant has heavily relied upon the following decisions of the Delhi High Court:
1.0. Banyan Tree Holding (P) Limited vs. A. Murali Krishna Reddy and Anr reported in 2010(42) PTC 361 (Del). 2.0. Hydac Fluidtechnik Gmbh and Anr vs. Flutec Industries reported in 2013(56) PTC 344 (Del).
5.7. Now, so far as reliance placed upon the invoices produced by the plaintiffs of Alka Stores and Shree Krushna Dudh Ghar referred to and produced by the plaintiffs to assert that the goods of the defendant are being sold within the territorial jurisdiction of the Court and in turn tried to establish a cause of action within the limits of the Court at Ahmedabad is concerned, it is vehemently submitted by Shri Shelat, learned advocate for the original defendant that said documents do not in any manner disclose that:
(a). Goods which are referred to in the invoice are the Goods of the defendant.
(b) That the defendant is selling goods through the said vendors or otherwise within the territorial jurisdiction of the Court either on a commercial basis or at all.
(c) That the Goods which are referred to in the invoice are so marked to be designed to lead purchasers to believe they are goods of plaintiffs.
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(d) That transaction produced as proof is a 'real
commercial transaction' and not a 'trap order' or 'trap transaction' set up by the plaintiff.
5.8. It is further submitted that apart from the fact that the contents of the invoices do not in any manner support the claim of the plaintiffs, the assessment of the invoices clearly establish that the same does not show that the defendant is selling any infringing goods within the jurisdiction of the Court since:
(1) The same merely refer to "Vimal Agro Products". (2) The said writing also is evidently overwritten by hand on the original document and appears unnaturally. (3) The purported label of the goods referred to in the invoice, which the plaintiffs believe to be the basis of their claim for passing off the goods of the defendant as that of the plaintiffs are also not produced.
5.9. It is further submitted that even the aforesaid invoices are not supported by any affidavit of the respective vendors to the effect that the goods in question are the goods supplied by the defendant to the vendor for sale.
5.10. It is further submitted that even the said vendors who as per the case pleaded by the plaintiffs are selling the goods and passing of the goods of the defendant as that of the plaintiffs are not impleaded as party defendant in the suit proceedings despite the Court below having given a specific opportunity to implead the said vendors.
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5.11. It is further submitted that even the aforesaid invoices are and do not show a genuine commercial transaction and in fact make it evident that the transaction is a set up created by the plaintiffs to invoke the jurisdiction of the Court.
5.12. It is further submitted by Shri Shelat, learned advocate for the defendant that in a suit for passing of it has to be established that the defendant is selling the goods which are designed to deceive intending purchasers that they are the goods of the plaintiffs within the jurisdiction of the Court. In support of his above submission, he has relied upon the decision of the Hon'ble Supreme Court in the case Ruston & Hornsby Ltd vs. Zamindara Engineering Co reported in (1969) 2 SCC 727.
5.13. It is further submitted that in the present case there are no material particulars set out in the plaint and documents to show that the defendant has prima facie:
(i) Sold and / or even dispatched goods and / or supplied goods on commercial scale for sale within the jurisdiction of the Commercial Court at Ahmedabad and
(ii) the goods which are so sold / dispatched/ supplied are such as liable to deceive intending purchasers into believing that they were goods of the plaintiffs. In support of his above submissions, he has relied upon the following decisions:
1. Firm Bhagwan Das Ramji Lal and another vs. Watkins Mayar and Co reported in AIR 1947 Lah 289.
2. Himachal Pradesh Horticulture Produce Marketing and Page 16 of 29 HC-NIC Page 16 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT Processing Corporation Limited vs. Mohan Meaki Breweries Limited reported in 1981(1) PTC 74 ( P & H)
3. Gold Seal Engineering Products Pvt Ltd and Ors vs. Hindustan Manufacturers and Ors reported in 1992(12) PTC 1 (Bom).
4. Archie Comic Publications, Inc vs. Purple Creations Pvt Ltd & ors reported in 2008(37) PTC 279 (Del).
5. A.V.R. Engineers vs. Sharma Molding Works and Ors reported in 2008 (38) PTC 243 (Del).
6. F. Hoffmann La Roche Ltd vs. Intas Biopharmaceuticals Limited reported in 2013(56) PTC 129 (Mad) (DB).
7. Austin Reed Limited vs. Suntex Garments Ors reported in 2007 (35) PTC 774 (MAD).
5.14. It is further submitted by Shri Shelat, learned advocate for the original defendant that in the present case question regarding the territorial jurisdiction of the Court in the subject suit for passing off is to be decided considering Section 20 of the Code of Civil Procedure. It is submitted that considering Section 20 of the Code of Civil Procedure, the plaintiffs are required to institute suit where the defendant resides or carries on business. It is submitted that it is the plaintiffs' own case that the defendant is not resident of Ahmedabad; that the defendant is having its office at Bardoli, Dist. Surat and there is no registered office or branch office in Ahmedabad.
5.15. It is further submitted that even it is the plaintiffs' own Page 17 of 29 HC-NIC Page 17 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT case in the plaint that the defendant has its office and carries on business at and from Bardoli, District Surat. It is submitted that there are no pleadings to support the case that the defendant is "carrying on business" within the jurisdiction of the Court. It is submitted that therefore, learned Commercial Court has rightly allowed the application Exh.21 by observing that for the relief sought in the plaint, Court at Ahmedabad would not have any territorial jurisdiction. In support of his above submissions, Shri Shelat, learned advocate has relied upon the following decisions:
1. Dhodha House and Patel Field Marshal Industries vs. S.K. Maingi & P.M Diesel Limited reported in AIR 2006 SC 730.
2. Shaw Wallace and Co Ltd vs. M.P.Beer Product Pvt Ltd reported in 2009(39) PTC 157 (Del).
3. SS Products of India vs. Star Plast reported in 2001(21) PTC 835 (Del).
5.16. It is further submitted by Shri Shelat, learned advocate for the original defendant that in a suit for passing off the cause of action would arise where the defendant is selling goods as marked as to be designed or calculated to lead purchasers to believe that they are the plaintiffs goods. It is submitted that it is only the factum of sale by the defendant of the infringing goods within the jurisdiction of the Court which can give rise to any cause of action for invoking the territorial jurisdiction of the Court. It is submitted that as it would become evident from a plaint, reading of the plaint and supporting documents, no cause of action has arisen within the territorial jurisdiction of the Commercial Court, Ahmedabad.Page 18 of 29
HC-NIC Page 18 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT 5.17. It is further submitted by Shri Shelat, learned advocate for the original defendant that the present appeal arises out of the order allowing the Order 7 Rule 10 application of the defendant. It is submitted that the law is clear on the point that the plaint and documents need to be looked into as a whole and no injustice should be caused to any party because of the cleaver drafting of the plaint. It is submitted that the averments made in the plaint which lack pith and substance cannot confer jurisdiction on the Court and suit therefore, cannot be entertained. In support of his above submissions, Shri Shelat, learned advocate for the defendant has relied upon the following decisions.
1.0. T.Arivandandam vs. T.V. Satypaal and Another reported in (1997) 4 SCC 467.
2.0. Heinz India Pvt Ltd vs. Shrejee Remedies reported in 2013(55) PTC 542 (DEL).
3.0. LTC Limited vs. Debts Recovery Appellate Tribunal And others reported in (1998) 2 SCC 70.
4.0. Church of Christ Charitable Trust and Educational Charitable Society vs. Ponniamman Educational Trust reported in (2012) 8 SCC 707.
5.0. Piccadily and Industries Ltd vs. Ashok Narwal reported in 2016(66) PTC 209 (Del).
Making above submissions and relying upon the decisions of the Hon'ble Supreme Court in the case of Neon Laboratories Limited vs. Medical Technologies Ltd & Anr reported in (2016) 2 SCC 672.
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6.0. Heard the learned advocates for the respective parties length. At the outset, it is required to be noted that by impugned order, the learned Commercial Court, Ahmedabad in exercise of powers under Order 7 Rule 10 of the Code of Civil Procedure, 1908 has returned the plaint to the original plaintiffs to present it before the appropriate Court having jurisdiction.
7.0. On considering the impugned order passed by the learned Commercial Court, it appears that what has been weighed with the learned Commercial Court is that;
(1) the suit is for permanent injunction and passing off; (2) no cause of action has arisen within the territorial jurisdiction of the Commercial Court, Ahmedabad; (3) that Section 134 of the Trade Marks Act shall not be applicable as the suit is only for the permanent injunction and passing off;
(4) that considering Section 20 of the Code of Civil Procedure as the defendant resides and / or carrying on the business and / or its registered office at Bardoli, the Commercial Court, Ahmedabad shall not have any territorial jurisdiction;
(5) that the invoices produced by the plaintiffs in support of their case that the goods of the defendant which deceptively similar to that of the plaintiffs are sold in Ahmedabad i.e. within the territorial jurisdiction of Ahmedabad are not genuine and that the person from whom the goods of the defendant are purchased are not joined as party defendant.
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8.0. Therefore, the short question which is posed for the consideration of this Court is whether in the facts and circumstances of the case and considering the averments and pleadings in the plaint/ suit the learned Commercial Court, Ahmedabad is justified in passing impugned order in exercise of the powers under Order 7 Rule 10 of the Code of Civil Procedure and in returning the plaint to the plaintiffs to present it before the appropriate Court having jurisdiction ?
8.1. While considering the aforesaid question / issue the necessary pleadings in the suit / plaint with respect to the cause of action pleased are required to be referred to, which are in para 31 of the plaint, reads as under:
"31. Cause of action: That the cause of action to file the present suit firstly has arisen when the defendants have filed opposition proceedings to plaintiffs' registration application somewhere in July, August, 2014 and thereafter in the last week of November, 2014 when the plaintiffs inquired through their field staff as to whether which goods are manufactured and marketed by the defendants. Further, the cause of action has arisen when the plaintiffs came across the defendants' ready to eat products in the market. Further, the cause of action has arisen when the plaintiffs have issued cease and desist notice dated 05.12.2014 to the defendants and when the acknowledgment receipt slip was received under the rubber stamp of the defendants. Further, the cause of action has arisen when the defendants have chosen to give evasive reply to the notice dated 05.12.2014 issued by the plaintiffs and as and when the copy of the caveat application is received by the plaintiffs in the third week of December, 2014. The plaintiffs have got knowledge that the defendants are carrying the business in the city of Ahmedabad and the cause of action has arisen within the territorial jurisdiction of this Hon'ble Court. It is further submitted that the defendants' goods are sold in Page 21 of 29 HC-NIC Page 21 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT the territorial jurisdiction of this Hon'ble Court and the plaintiffs have purchased the defendants goods in the city of Ahmedabad vide cash memo Nos.2413 dated 19012015 from Alka Stores, Ahmedabad for Rs.730/and vide cash memo Nos.42 dated 09012015 from Shree Krushan Dudh Ghar, Ahmedabad for Rs.235/which is produced separately with the list. The plaintiffs are also carrying on their business at Mehsana, Ahmedabad and elsewhere in different cities in country and the plaintiffs' goods are also available in the city of Ahmedabad. The defendants are manufacturing and marketing their products under the trade name /trade mark VIMAl in a clandestine and surreptitiously manner and as such the cause of action is continuous and subsisting against the defendants from day to day till the defendants are restrained from using the key word VIMAL by an order of this Hon'ble Court. Moreover, the defendants have also passed off plaintiffs' VIMAL trade mark/ trade name by using the same or deceptively similar trade name/trading style and guilty of passing off plaintiffs' trade mark/ trade name VIMAL under section 34 of the Trade Marks Act, 1999 and also under section 20 of the Code of Civil Procedure, 1908. The plaintiffs say that the cause of action has also arised on 03012015 when the website of the defendant came to be known by the plaintiff no.2 when the reply at 27122014 was received by the plaintiffs on 08012015 and photocopy of the said website was taken out on 09012015. The plaintiffs say that the cause of action is continuous and recurring day by day."
8.2. It is not in dispute and it is an admitted position that the original defendant is carrying on its business and is having its registered office at Bardoli (not within the territorial jurisdiction of the Commercial Court, Ahmedabad). It is not in dispute that the suit is for passing off action and for permanent injunction. It is not in dispute that the plaintiff's are carrying on their business and / or are having its registered office within the territorial jurisdiction of Ahmedabad. In light of the aforesaid facts, it is required to be Page 22 of 29 HC-NIC Page 22 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT considered whether the Commercial Court, Ahmedabad would have territorial jurisdiction to entertain the suit and grant reliefs as prayed in the plaint / suit.
9.0. Therefore, while considering the aforesaid issue, the cause of action pleaded in the suit is required to be considered. The cause of action pleaded in the suit is reproduced herein above. It is mainly pleaded that as the defendant goods are sold in the territorial jurisdiction of the Court at Ahmedabad and the plaintiffs have purchased the defendant goods in the City of Ahmedabad vide cash memo Nos.2413 dated 19012015 from Alka Stores, Ahmedabad for Rs.730/ and vide cash memo Nos.42 dated 09012015 from Shree Krushna Dudh Ghar, Ahmedabad for Rs.235/ and therefore, the goods manufactured by the defendant are being sold within the territorial jurisdiction of the Court at Ahmedabad. However, it is required to be noted and as rightly observed by the learned Commercial Court, the invoices relied upon by the plaintiffs of Alka Stores and Shri Krushna Dudh Ghar, Ahmedabad did not inspire any confidence and they did not appear to be genuine. The so called vendors Alka Stores and Shri Krushna Dudh Ghar, Ahmedabad are not joined as party defendants, though sufficient opportunity was given to the plaintiffs. Even from the cash memo's / invoices it does not establish even prima facie that the goods manufactured by the defendants are being sold within the territorial jurisdiction of the Court at Ahmedabad. Even, it does not suggest that except name of the defendant, which seems to have been written subsequently, it is not even established prima facie that the goods of the defendants are being sold. It is not Page 23 of 29 HC-NIC Page 23 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT averred in the plaint that Alka Stores and Shri Krushna Dudh Ghar, Ahmedabad are the agents / authorized dealers of the defendants. It appears that only with a view to get the suit within the territorial jurisdiction of the Court at Ahmedabad, the plaintiffs have come out with a illusory cause of action and it appears that as such no cause of action has arisen within the territorial jurisdiction of the Court at Ahmedabad.
9.1. Considering the pleadings in the plaint, there are specific averments in the plaint with respect to passing off trade mark / trade name of the plaintiffs. As observed herein above, the plaintiffs are carrying on their business and are having its registered office within the territorial jurisdiction of the Commercial Court, Ahmedabad. Under the circumstances and considering the averments in the plaint, more particularly, with respect to passing off the trade mark / trade name "Vimal", Section 134 of the Trade Marks Act, 1999 would come into play. Section 134 of the Trade Marks Act, reads as under:
"Section 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 subsection (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 Page 24 of 29 HC-NIC Page 24 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT 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 subsection (2), "person" includes the registered proprietor and the registered user."
9.2. Therefore, considering Section 134 of the Trade Marks Act, plaintiffs can institute suit for passing off arising out of the use by the defendant of any trade mark which is identical of any trade mark which is identical with or deceptively similar to the plaintiff's trade mark, whether registered or unregistered in a District Court having jurisdiction to try the suit and as per subsection (2) of Section 134 of the Act for the purpose of clause (a) and (b) of Section 134, a District Court having "jurisdiction" shall notwithstanding anything contained in the Code of Civil Procedure, 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 proceedings, the person instituting the suit or proceedings, resides or carrying on business or personally works for gain. It appears that in the present case, the trade mark / trade name "Vimal" is not a registered trade mark and therefore, as rightly observed by the learned Commercial Court that Section 134 of the Trade Marks Act shall not be of any assistance to the plaintiffs.
9.3. Therefore, for the purpose of jurisdiction, with respect to Page 25 of 29 HC-NIC Page 25 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT passing off the action Section 20 of the Code of Civil Procedure shall be applicable. Considering Section 20 of the Code of Civil Procedure, suit is required to be instituted in the Court within whose jurisdiction the defendant either resides and / or carries business and / or is having registered office and / or even the Branch office. As observed herein above, admittedly the defendant is carrying on business at Bardoli and is also having its registered office at Bardoli, beyond the jurisdiction of the Commercial Court, Ahmedabad.
10. However, it is the case on behalf of the plaintiffs that as the suit for permanent injunction and passing off the trade mark / trade name of the plaintiffs and therefore, the suit for permanent injunction and passing off shall be maintainable in a Court within whose jurisdiction the defendant goods are being sold which are similarly deceptively to that of the plaintiffs. In support of his above submission, learned advocate for the plaintiffs has heavily relied upon the decision of this Court in the case of Pam Pharmaceuticals (supra) and in the case of Unilever PLC & Anr (supra). Learned advocate for the plaintiff's has also heavily relied upon the decision of the Hon'ble Supreme Court in the case of Saleembhai and others (supra) in support of his submission that at this stage only the averments in the plaint are required to be considered. The plaintiffs have heavily relied upon two invoices of Alka Stores and Shree Krushna Dudh Ghar in support of their case that as the defendant goods are being sold in the city of Ahmedabad, the Commercial Court at Ahmedabad shall have jurisdiction. However, it is required to be noted that along with the plaint, the plaintiffs Page 26 of 29 HC-NIC Page 26 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT have not produced the original invoices issued by Alka Stores and Shree Krushna Dudh Ghar. Even the person / alleged dealers from whom the goods of the defendant are purchased are also not joined as party defendant. There are no averments whatsoever that as such those two dealers are the agents / dealers of the defendant and / or they are selling the goods of the defendant at the instruction given by the defendant and / or within the knowledge of the defendant. It is true that at this stage normally the averments in the plaint are required to be considered and not the defence. However, even the averments in the plaint must be supported by some cogent evidence and / or document. Mere averments in the plaint to bring the suit within the territorial jurisdiction of the Court shall not be sufficient. Even otherwise, considering the invoices / documents produced along with plaint i.e. invoices of Alka Stores and Shree Krushna Dudh Ghar produced by the plaintiffs to assert that the goods of the defendant are being sold within the territorial jurisdiction of the Court and in turn tried to establish a cause of action within the limits of the Court at Ahmedabad, the said documents do not in any manner disclose that the goods which are referred to in the invoices are the goods of the defendant. It also does not disclose that the defendant is selling goods through the said vendors or otherwise within the territorial jurisdiction of the Court either on a commercial basis or at all. It does not disclose that the transaction produced as proof is a "real commercial transaction" and not a "trap transaction" set up by the plaintiffs. The invoices merely refer to " Vimal Agro Products". Even the said writing seems to be overwritten by hand on the original document. The purported label of the goods referred to in the Page 27 of 29 HC-NIC Page 27 of 29 Created On Wed Aug 16 05:49:33 IST 2017 C/AO/422/2016 CAV JUDGMENT invoices, which the plaintiffs believe to be the basis of their claim for passing off the goods of the defendant as that of the plaintiffs are also not produced. The said invoices are also not supported by any affidavit of the vendor to the effect that the goods in question are the goods supplied by the defendant to the vendor for sale. The cause of action pleaded in the plaint is reproduced herein above. It appears that the plaintiffs have invoked the jurisdiction of the Commercial Court at Ahmedabad by referring to the following causes in the plaint.
i. Opposition to the Registration of their TradeMark. ii. Receipt of acknowledgment of their cease and desist notice.
iii. Receipt of caveat application iv. Website of the respondent.
v. Purchase of defendants goods in the city of Ahmedabad.
10.1. None of the aforesaid causes shall confer the jurisdiction in the Commercial Court, Ahmedabad. Thus, on the basis of cause of action pleaded in the plaint, it cannot be said that on such causes pleaded, the Commercial Court, Ahmedabad shall have territorial jurisdiction.
10.2. Considering the aforesaid facts and circumstances and more particularly, considering Section 20 of the Code of Civil Procedure and cause of action pleaded in the plaint, it cannot be said that the learned Commercial Court has committed any error in returning the plaint to the plaintiffs to present it before the appropriate Court having jurisdiction.
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11. In view of the above and for the reasons stated above, present Appeal From Order fails and same deserve to be dismissed and is accordingly dismissed.
sd/ (M.R. SHAH, J.) sd/ (B.N. KARIA, J.) Kaushik Page 29 of 29 HC-NIC Page 29 of 29 Created On Wed Aug 16 05:49:33 IST 2017