Delhi District Court
Additional District Judge (Central) vs M/S Das Entertainment Pvt. Ltd on 1 October, 2012
1
IN THE COURT OF SHRI MAN MOHAN SHARMA
ADDITIONAL DISTRICT JUDGE (CENTRAL) 01
TIS HAZARI COURTS, DELHI.
Civil Suit No.: 32/2008
Unique case ID no 02401C0268902008
M/S BCI Optical Disc Ltd.
2 SSI, Industrial Area,
G.T Karnal Road, Delhi 33. ...Plaintiff
VERSUS
1. M/s Das Entertainment Pvt. Ltd.
301314, 3rd Floor, Samarth Vaibhav
New Link Road, Near Indra Darshan
Andheri (West)
Mumbai.
2. Sh. Dhyanu Das
Director M/s Das Entertainment Pvt. Ltd.
301314, 3rd Floor, Samarth Vaibhav
New Link Road, Near Indra Darshan,
Andheri (West) Mumbai
....Defendant
Date of institution of the suit : 20.02.2008
Reserved for judgment on : 01.10.2012
Date of pronouncement of judgment : 01.10.2012
JUDGMENT:
1. The case of the plaintiff is as under:
CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 1 of 15 2
(i) The plaintiff is a public ltd. company duly incorporated under the Companies Act, 1956 having its registered office at the above given address and Sh. Raju Bathla, Son of Shri M.L Bathla is the Director of the company who is well conversant with the facts of the case and duly empowered to sign, verify the pleadings and institute the present proceedings and has been duly authorized in this behalf, vide resolution passed by Board of Directors of the plaintiff company and has also been authorized to appoint Mr. M.P Khurana, Principal Officer of the company who is well conversant with the facts of the case as Special Attorney to peruse the case and duly empowered to act as per special power of attorney executed in his favour.
(ii) The plaintiff company is engaged in the business of manufacturing and trading CD, DVD, Audio and Video.
(iii) The plaintiff publishes its sound recording, VCD, DVD etc. of the Cinematographic films and audio visual song etc. either as the owner of the copy right of the works embodied therein or after taking assignment of right from the producers / copy rights owners.
CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 2 of 15 3
(iv) The defendant no.2 had represented himself as Director of the defendant no.1 to be the sole, exclusive unrestricted producer and all negative and other holders of the films and was carrying on business under the name and style of defendant no.1 at the address given above and intended that the plaintiff company to purchase the copyright which are being owned by them as sole exclusive unrestricted producer and all communication and other right holder of three cinematograph films titled as 1) Sonia Sonia (A love story - love for an Indian and India) 2) Lagan - (The Dedication) 3) Anjaan - (When a stranger comes calling).
(v). The defendants trapped the plaintiff company to take the sole and exclusive assignment of all the commercial and non commercial video copyrights for communication to and for the public and all other rights touching the said films for the Territory of entire India including Nepal, Bhutan, and Sikkim and also agreed to accept the assignment in all forms of recording, embodying processing publication, dubbing, subtitling, mechanical synchronization for distribution CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 3 of 15 4 exhibition, exploitation telecast, broadcast and or communication to and for the publication in any manner and for any purposes and by any method and technology now in existence or may be discovered and invented in all other rights howsoever arising from or touching the said films, as per agreement dated 14th day of November 2005, duly entered between the parties.
(vi) The defendant induced plaintiff to purchase the communication by cable T.V rights and video rights of the said films item no.1 for a sum of Rs. 4,00,000/, item no.2 for a sum of Rs.2,00,000/ item no.3 for a sum of Rs.6,00,000/ and obtained a sum of Rs.80,000/ against item no.1 and Rs.
1,00,000/ for item no.3, thus obtained a sum of Rs.1,80,000/ vide cheque no. 681330 dated 14.11.05 drawn on Oriental Bank of Commerce, for a sum of Rs.80,000/ against film Sonia Sonia and cheque no. 681332 dated 14.11.2005 for a sum of Rs. 1,00,000/ against film Anjaan and a receipt to this effect was also issued by the defendants on 14.11.05, these cheques had been duly encashed and credited to the accounts of defendant CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 4 of 15 5 no.1.
(vii) The defendants had given second film as agreed vide agreement dated 14.11.2005 titled lagan - The dedication, and received a sum of Rs.1,80,000/ as the total amount agreed for the said film was Rs. 2,00,000/ but the defendants for the reasons best known to them had not delivered the remaining two films titled as Sonia Sonia, and Anjaan inspite of repeated requests, demands and reminders and personal visits, nor the defendants refunded the advance given to them in this regard nor they informed the plaintiff regarding non supply of the said films. The said conduct on the part of the defendants was such as if they never intended to part with the copy rights of these two films and wanted to cheat and defraud the plaintiff company to the tune of Rs.1,80,000/.
(viii) The plaintiff company had suffered damages due to wrongful and illegal act of the defendants as the plaintiff has been deprived of any such other good films which the plaintiff company could purchase if the same has been informed to the plaintiff and the amount had been returned to the plaintiff. The CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 5 of 15 6 entire business of the plaintiff company was withheld as the plaintiff company suffered recurring loss as the entire process came to stand still. The modusoperandi of the plaintiff company is that after purchasing the copy rights of the cinematographic films, the same is released and published on DVD and VCD after release of the cinematographic film on theaters. The demand for DVD and VCD is much during that period and the plaintiff could recover at least cost of the copy rights in 2/3 months and the same is again reinvested in the other films and so on and the circle goes on moving but the entire circle of the plaintiff company became stand still due to the wrongful, illegal and criminal act of the defendants. It had not been confirmed by the defendant whether these films were made at all or not. The plaintiff had not been informed regarding the status of these two films. During this period of 26 months, there ought to have been at least 10 such repeats so then at least there was a profit of Rs. 1,00,000/ per circle which comes to Rs.10,00,000/. There is also loss of interest, which as per market usage in the trade is at least 2 % per month. There is CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 6 of 15 7 other business loss as the retailers wanted to have a complete set of CD and DVD of the film released during this period but due to withholding of the money by the defendant company the plaintiff company could not complete the set. The plaintiff company also suffered loss of reputation as the plaintiff company could not fulfill his obligations to its dealer regarding the release of these two films and the plaintiff company assessed consolidated damages to the minimum which comes to Rs.11,00,000/.
That now the plaintiff claims:
a. The refund of the amount advanced
to the defendant. Rs. 1,80,000/
b. Consolidated damages as per paragraph
no.9. Rs.11,00,000/
c. Notice and other charges Rs 11,000/
Total Rs. 12,91,000/
(ix) A legal notice dated 9.8.07 was duly served upon the
defendants vide registered cover as well as under the certificate of posting but no response was received from the defendants in CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 7 of 15 8 this regard.
2. The notice of the suit had been sent to defendant no.1 and 2 and vide minutes of proceeding dated 2.3.2009, the defence of defendant has been struck off. The defendant did not join the future proceedings and the case continued as exparte.
3. I have heard the arguments as addressed by ld. Counsel for plaintiff.
4. It is submitted that the evidence of plaintiff is unchallenged and thus his case, based on oral and documentary evidence, stands proved. Ld. Counsel for the plaintiff has read the pleadings and the evidence and has also referred to the documents on record.
5. I have considered the submissions and the material on record.
6. The plaintiff has tendered his oral evidence through Sh. M.P Khurana as PW1. His oral deposition is contained in affidavit Ex.P1. He has tendered the following documents on record:
(i). Ex.PW1/1 is extracts of resolution of Board dated 21.01.2008.
(ii). Ex.PW1/2 is GPA favouring Shri M.P Khurana dated 16.02.2007.
(iii). Ex. PW 1/ 3 is copy of the certificate of incorporation of CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 8 of 15 9 plaintiff.
(iv). Ex.PW1/4 is an agreement dated 14.11.2005.
(v). Ex.PW1/5 is a receipt of Rs 2,00,000/ dated 14.11.2005.
(vi). Ex.PW1/6 is copy of a legal notice dated 9.08.2007.
(vii). Ex.PW1/7 is the registered postal receipt; Ex.PW1/8 is the UPC certificate and Ex.PW1/9 is AD card.
7. Another witness examined by the plaintiff is the Notary Public as PW2 to prove the attestation of the power of attorney Ex. PW1/2.
8. Ex. PW 1/ 3 is copy of the certificate of incorporation of plaintiff; Ex. PW 1/1 is the extracts of Board Resolution of plaintiff company dated 21.01.2008 and Ex. PW 1/ 2 is the Special Power of Attorney. Together these documents prove the factum of existence of the plaintiff company and the authority of Shri M. P. Khurana to institute the suit and represent the plaintiff company.
9. Ex. PW 1/4 is agreement dated 14.11.2005 and Ex. PW 1/5 is receipt dated 14.11.2005. Together these documents prove the transaction between the plaintiff and the defendant, its terms and the payment of money.
10. Ex. PW 1/6 is Legal Notice dated 09.08.2007;Ex. PW 1/7 is the CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 9 of 15 10 postal receipt; Ex. PW 1/8 is UPC Certificate; Ex. PW 1/ 9 is the AD Card. Together these documents prove the factum of the notice to the defendant as to the breach of its obligation visàvis the contract between the parties.
11. Though the testimony of the plaintiff has remained un challenged and unrebutted, this Court has to sift the evidence on record to arrive at the conclusion as to what facts stand proved in accordance with the rules of evidence; what they establish and to what relief the plaintiff is entitled to on the basis of the facts established in evidence.
12. The case of the plaintiff must stand on its own legs. Even in the cases in which defendant is exparte or the defence of the defendant has been struck off, the propounder does not get absolved of his duty to establish the relevant facts, which constitute the genesis of his claim, by some credible evidence. The rule of law is 'actori incumbit onus probandi' i.e. the burden of proof lies on the plaintiff or the prosecution. Mere absence of the adversary does not ipsofacto means that he or she has acquiesced in the existence of or the truth of the facts pleaded in the plaint. Such absence of defendant does not by CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 10 of 15 11 itself justify a presumption that the plaintiff's case is true. The summons, which were directed to the defendant, only put him on a caveat that in the default of his appearance the matter would proceed exparte. It did not state that his nonattendance would invite the presumption of the truth of the plaintiff's version.
13. It is on the touchstone of this settled position of law that the evidence of this case has to be appreciated, notwithstanding the fact that the defendant preferred to remain exparte.
14. The payment of Rs.1,80,000/ is established by the receipt Ex.PW1/1, which documentary evidence is unchallanged. Therefore, the plaintiff is entitled to refund of the same on account of there being default on the part of the defendant in the discharge of its obligation under the agreement Ex. PW 1/4. The plaintiff is thus entitled to refund of this amount.
15. As regard the damages claimed by the plaintiff, there is no tangible evidence on record regarding the quantum of damages. No mode or manner of calculation of damages in tangible terms has been disclosed and only self serving statement has been made. Hypotheses cannot take place of evidence.
CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 11 of 15 12
16. PW1 has stated that the plaintiff has been deprived of any such other good films which the plaintiff company could purchase if the same has been informed to the plaintiff and the amount had been returned to the plaintiff. This statement is based in the economic concept of the 'Opportunity Cost' i.e. the cost of the next best alternative.
17. The loss is the absence of profit. The same could have been proved by the plaintiff either by showing the past transactions in which the plaintiff had earned certain profits in the similarly placed transaction. It could also have been proved by bringing the evidence of some other Contemporary in the business to show that he had made certain profit in the same or similar kind of transaction. This kind of evidence could have been found either in the accounts books of the plaintiff or in the accounts books of the Contemporary in business and would have been the most credible evidence to establish this factual aspect.
18. Thus the past or the contemporary books of accounts could have been the best evidence showing that under the similar transactions the plaintiff or its business contemporary has made a profit and by CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 12 of 15 13 claiming parity to claim loss. Such accounts or evidence had been within the reach of the plaintiff. However it was not produced.
19. Even the notice dated 09.08.2007 Ex.PW1/6 plaintiff has not claimed any damages. Thus, at no point of time before the filing of the suit the defendants had been put to any notice of suffering or the likelihood of suffering any damages on the part of plaintiff. However taking a cue from the law laid down in Jeevan Diesels & Electricals Ltd. vs. M/S Jasbir Singh Chadha (HUF) 183 (2011) DLT 712, the date of service of plaint and documents is deemed to be date of service of notice. Thus the plaintiff had adequately put the defendant as to the notice of damages from the date of service of plaint with documents.
20. The deposition of plaintiff regarding suffering of damages is boisterous and hyperbolic without disclosing any intelligible differentia which can assist the court in arriving at some credible basis for assessment of damages.
21. Therefore in the absence of any such material the Court has to take judicial notice as laid down in a catena of case law. It is the duty of the Court to balance the rights and liabilities of the parties. On the CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 13 of 15 14 one hand, the Plaintiff cannot be granted the sky just for the asking, on the other hand the defendant cannot be allowed to reap benefits out of the his own defaults, as the same would tantamount to rewarding the wrong doer and giving a premium over the dishonest conduct.
22. Therefore the damages can be awarded to the plaintiff on the yardstick of reasonableness. Activity of any reasonable and prudent man is directed towards maximization of profits. The plaintiff is not a busy body who has whiled away his efforts and money is fruitless activities. It is a business concern aimed at earning profits. Profit is a not a dirty word. It is a reward of enterprise in the same manner as the wages are the reward of services; rent is the reward of use of capital assets and interest is the reward of parting with the liquidity of money.
23. Taking a collective assessment and applying the doctrine of reasonableness it would serve the interest of justice, if the plaintiff is awarded damages equal to double the amount of the money paid by it to the defendant. The plaintiff is thus awarded a sum of Rs. 3,60,000/ consolidated towards all the counts as damages against the defendant.
24. As the sending of the legal notice has been necessitated on CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 14 of 15 15 account of the breach of agreement on the part of the defendant the plaintiff is also awarded the sum of Rs. 11,000/ as claimed towards the notice charges.
25. Thus the suit of the plaintiff is decreed for Rs. (Rs. 5,51,000/ (Rupees Five Lakhs Fifty One Thousand Only). The plaintiff is also awarded pendetalite and future interest, w.e.f from the date of institution viz. 20.02.2008 till the date of final realization on the said amount of Rs. 5,51,000/ (Rupees Five Lakhs Fifty One Thousand Only) @ 12% per annum which appears to be the reasonable rate of interest commensurate with the current business milieu, nature of transaction in question and the element of risk involved etc. The plaintiff is also awarded the costs of the suit.
26. Decree be drawn accordingly.
27. File, after necessary compliance be consigned to the Records Room.
Announced in the Open Court On this 1st day of October 2012 (MAN MOHAN SHARMA) ADJ (Central)01, Delhi CS 32/2008 BCI OPTICAL DISC LTD. V. DAS ENTERTAINMENT PVT. LTD. Page 15 of 15