Gujarat High Court
Carneige Institute Of Washington vs Fenix Diamonds Llc on 10 September, 2020
Author: G.R.Udhwani
Bench: G.R.Udhwani
C/MCA/374/2020 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/MISC. CIVIL APPLICATION NO. 374 of 2020
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CARNEIGE INSTITUTE OF WASHINGTON
Versus
FENIX DIAMONDS LLC
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Appearance:
MR KABIR A HATHI(6018) for the Applicant(s) No. 1,2
MR SHIVANG M SHAH(5916) for the Applicant(s) No. 1,2
MR SAURABH SOPARKAR, SENIOR COUNSEL WITH MR AMAR N
BHATT(160) for the Opponent(s) No. 3
MR AS VAKIL(962) for the Opponent(s) No. 1
MR MIHIR JOSHI, SENIOR COUNSEL WITH MR KUNAL P
VAISHNAV(5111) for the Opponent(s) No. 2
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CORAM:HONOURABLE MR. JUSTICE G.R.UDHWANI
Date : 10/09/2020
ORAL ORDER
1. This application is made under Order 26 Rules, 19, 20 and 21 read with Sections 78 and 151 of the Civil Procedure Code, 1908 (for short "CPC") with the prayers as below :
"12(a) To execute the Letter of Request dated 27.05.2020 issued by the Unites State District Court for the Southern District New York under the Convention;
(b) Appoint and issue a Commission in accordance with Order 26 Rule 19 and 20 of the Code of Civil Procedure, 1908 to examine witnesses under oath (deposition testimony under oath) mentioned in paragraph 1 of the Letter of Request namely Bakulbhai Limbasiya and Chirag Limbasiay;
(c) Permit inspection of facilities used by Bakulbhai Limbasiya and Chirag Limbasiay for manufacturing and treating CVD diamonds in accordance with Appendix C and Appendix F of the Letter of Request dated 27.05.2020;
(d) Permit production of documents by Bakulbhai Limbasiya and Chirag Limbasiay regarding issues identified in the Exhibit 1 Page 1 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER of the Letter of Request dated 27.05.2020;
(e) Further be pleased to pass an order of issuing a commission for purposes enumerated in Appendix A to F of the Letter of Request dated 27.05.2020 at ANNEXURE A on such terms and conditions as the Hon'ble Court may deem fit;
(f) Direct the Commissioner to permit video recording of all proceedings before it;
(g) Pass such other and further order(s) as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case."
2. The applicants - original plaintiffs in the District Court, Southern District, New York have sued the opponent No.1 original defendant in a patent litigation alleging infringement of U.S. Patent No. 6,858,078 entitled "Apparatus and Method for Diamond Production," and U.S. Paten No.RE41,189, entitled "Method Enhanced CVD Diamond". The opponent Nos. 2 and 3 are the intended witnesses therein.
3. Pursuant to Hague Convention dated 8th March, 1970 on the taking of the evidence abroad in civil or commercial matters, a Letter Rogatory is issued by the U.S. District Court for the Southern District New York, with a request to returning the response thereto, by 1 st August, 2020; while citing an urgency that the oral testimony requires to be completed before presentation of expert testimony scheduled on 7 th August, 2020; and in all events by 4th September, 2020, the request is to take the deposition testimony under oath, inspection of the facilities used for manufacturing and treating CVD diamonds; and production of documents regarding the issues identified in Exh.1 (Letter of Request). The questions to be put to the persons sought to be examined are set out in appendices A and D of Exh.1 to the Letter of Request. The documents and other properties to be inspected have been specified in appendices B, C, E and F of Exh.1. The Letter also solicits the written information about the time Page 2 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER and the place of the proceedings to be undertaken by the commissioner for the District Court, New York as also to the parties' representatives at the addresses mentioned in the Letter of Request in terms of Article 7 of the Hague Convention. The Letter of Request has been issued on 27th May, 2020. Several other requests are made which if necessary would be referred in this order.
4. Learned counsel for the applicants has sought reliance on Section 78 as also Order 26 Rule 19, 21 and 22 of the CPC and submitted that the commission should issue as all the required conditions for the purpose have been fulfilled. In his submission none of the other issues raised by the opponents deserve merit. Learned counsel placed reliance on Wooster Products Inc. Vs. Magna Tec Inc. and Ors, [Interim Application Nos. 9757, 9758 and 9759 of 1987 and Original Misc. Petition No. 143 of 1987] decided on 25.05.1988 by the High Court of Delhi.
4.1 Learned counsel Mr. Hathi for the applicants; while referring to Section 3 of the Indian Evidence Act submitted that the expression "evidence" comprehends the document and accordingly the document also can be solicited from the witnesses. It has been submitted that Rule 22 of Order 26 of CPC is only clarificatory in nature and Rule 16 of Order 26 is of wide amplitude comprehending the powers of the Commissioner to be exercised under "this order" for the purpose of calling for the documents, or inspecting the plant and machinery. In his submission said rule is applicable to this case.
5. Learned senior Counsel Mr.S.N. Soparkar has urged for the rejection of the prayers for : (1) expiry of Letter Rogatory which was required to be complied with by 1st August, 2020; the specified date having passed; (2) by virtue of omission of Rule 16 from Rule 22 of Page 3 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER Order 26 of the CPC, the Commissioner is no more empowered to call for the documents or enter upon the land or into the building for the purpose of inspection/investigation. He also drew attention of this Court to Rule 16A of Order 26 of the CPC with a submission that after deliberate omission of Rule 16, by the very amendment, Rule 16A is deliberately inserted making the intention of the legislature clear that the Commissioner appointed under Order 26 Rule 19 of the CPC would be entitled to record the evidence of the witness only. Shri Soparkar submitted that the judgment in Wooster Products Inc. (supra) on this count is per incuriam as it has incorrectly read Order 26 Rule 22 of the CPC; (3) that if at all the request was to be acceded to, the Hague Convention in absence of its effect by amendment in the Indian Procedural Law, would not be applicable to an extent of its incompatibility with Indian procedural laws and therefore the part of requests impermissible under the Indian law may be declined. Reliance is placed on State of West Bengal Vs. Kesoram Industries [(2004) 10 SCC 201]; (4) the opponent No.3 is cited as a witness, not being a party to the proceedings in US Court; the relevance of the questions having not been adjudicated by the requesting Court, the whole exercise would amount to a roving and fishing inquiry and the inspection of the document/machinery sought would impeach the secrecy of the business of the witness. Shri Soparkar contended that in the event the Court was inclined to accede to the Letter of Request, relevance of the questions should be determined and the secrecy of the business of the witness should be protected. It was contended that the opponent No.3 did invite the plaintiffs for local investigation of the machinery and relevant documents subject to the plaintiffs' guaranting the secrecy but the plaintiffs did not agree and thus intentions of the plaintiffs are not bona fide; (5) The ambit and scope of Letter of Request would not remain the original in view of several documents; the copies of the same having been already made available to the plaintiffs as is evident from the amended Page 4 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER plaint Annexure-D affirmed by counsel for the plaintiffs. In his submissions therefore the request may not be acceded to.
6. Learned senior counsel Mr.Mihir Joshi for the opponent No.2 would adopt the arguments advanced by learned senior counsel Mr.Soparkar. In addition, learned senior counsel Mr.Joshi would invite the attention of this Court to Sections 75 and 78 and Order 26, Rule 1, 9, 11, 13, 10A, 10C, 10D of the CPC with the submissions that Section 78 and Order 26 Rules 19, 20 and 21 are the only provisions relating to the commission to be issued at the instance of the Court in the foreign country and the expression "evidence of a witness" used in the said provisions as distinguished from "evidence from a witness", would not comprehend production/inspection of documents and inspection of premises or machineries.
7. Learned counsel Mr. Vakil for the opponent No.1 made principally three submissions: (1) that the Letter of Request was exhausted by the factum of frustration of the date fixed by the requesting court for the return of the Commission, in absence of its renewal, (2) that the Letter of Request stands frustrated on account of subsequent developments more particularly development indicating the supply of relevant papers to the applicants after the Letter of Request and (3) that Section 78 of the CPC was the principal provision bearing on the facts of the case where under the Commissions can be appointed only for examination of witnesses and for no other purpose. Learned counsel submitted that therefore the Letter of Request soliciting the documents or requesting the local inspection of the premises of the witnesses must fail. Reliance is placed on Sail Labs Technology, Vienna v. International Business Software Solutions Inc., Vienna [2008 SCC Online AP 652]. Learned counsel also would invite attention of this Court to Rule 18B of the CPC and would submit that the date fixed for return of the commission having expired by now, it Page 5 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER cannot be extended and the extension would tantamount to issuance of fresh Letter of Request by this Court substituting the foreign Court. Learned counsel placed reliance on Mrs. Rekha Mukherjee Vs. Ashis Kumar Das [(1988) 1 Cal LJ 199] .
8. Having considered the rival submissions, this Court rules as under :
8.1 For resolution of the controversy, ambit and scope of Sections 75 and 78 and the relevant provisions of Order 26 of the CPC deserve attention. Conjoint reading of Sections 75 and 78, Order 26 Rule 19 and Rule 22 of the CPC makes it clear that while the commissions can be issued for varied purposes enumerated in Section 75; the commissions only for examination of witnesses would be issued u/s 78, inter alia, at the request of foreign Court on satisfaction of the criteria indicated in Order 26 Rule 19 of the CPC and the procedure provided in Order 26 Rule 22 of the CPC would apply to such Commissions. [See Sail Labs Technology, Vienna v. International Business Software Solutions Inc., Vienna [2008 SCC Online AP 652].
Power of the Commissioners to adjudicate upon the matters referred to him and undertake an inquiry and for those purposes, examine the witnesses and solicit the documents from them and the power to enter upon or into any land or building which was once available under Order 26 Rule 22 of the CPC, having been taken away by deliberate omission of rule 16 from Order 26 Rule 22 by Amendment Act 104 of 1976, are no more exercisable by the Commissioner.
The expression "foreign court wishes to obtain evidence of a witness" employed in Order 26 Rule 19 of the CPC is a clear indication that Commission would not issue for any other purpose. It would not be permissible to resort to expression "evidence" as defined in the Indian Page 6 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER Evidence Act so as to read the production of document in Section 78 and Order 26 Rule 19 of the CPC as submitted by the learned counsel for the applicants, as that would result into injustice to the very clear legislative intent (supra) and this Court with great respect is unable to agree with the contrary findings to the one recorded by this Court, in Wooster Products Inc. (supra) for the above reasons. True that Rule 16 confers the power upon the Commissioner appointed "under this order' (Order 26), reading the expression in abstract of the legislative intent expressed in the amending Act (supra) would be doing injustice to such legislative intent. Pertinently the legislative intent (supra) was reemphasised by introducing Rule 16A in Order 26 of the CPC by the very amending Act. The provision intends to deal with a manner to deal with the objections in relation to a question "put to a witness" which expression makes it clear that it is the witness and not the document or inspection or investigation which would be in focus. The Rule apparently reckons the purpose of the Commission indicated in Section 78 and Order 26 Rule 19 of the CPC.
8.2 Another issue raised herein is as regards the adjudication of "relevance of evidence". In absence of the adjudicatory power under Order 26 Rule 19 of the CPC, the very exercise would be without jurisdiction and therefore the submissions do not deserve merits. The pronouncements in West Bengal Vs. Kesoram Industries and Mrs. Rekha Mukherjee Vs. Ashis Kumar Das (supra) were made in the context of specific foreign law applicable to the facts of that case and thus cannot be applied to the facts of the present case.
8.3 Apropos the frustration of the Letter of Request for the failure of date of return of the commission as specified by the requesting Court, this Court is of the opinion that the Commission would issue under Order 26 Rule 19 of the CPC on satisfaction that a foreign Court situated in a foreign country wishes to obtain the evidence of a witness in any Page 7 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER proceeding before it, that the proceeding is of a civil nature and that the witness is residing within the local limits of High Court's appellate jurisdiction; subject to Rule 20 of Order 26 of the CPC. As a necessary corollary the request by a foreign Court would fail only in absence of such satisfaction and on no other grounds. Rule 18B of Order 26 of the CPC cannot be applied for the purpose as it can be applied only at the time of issuance of the Commission by a Court of this country. Under the provision, while issuing the Commission, a date of return of the Commission can be fixed; such date would not be extendable except for the specified reasons, and the Commission executed beyond the specified/extended date would suffer a lawful authority. Rule 18B finds a reference in Rule 22 and thus the Commission issuing Court can fix or extend the date of return of the Commission. Thus, it would be permissible for this Court to resort to Order 26 Rule 18B of the CPC at the time of issuing the Commission irrespective of the expiry of date of return of the Commission fixed by the foreign Court. In fact a close scrutiny of Rule 18B would show that once the case for appointment of Commission is made out, the issuing Court would necessarily fix the date of its return; in absence of whereof the Commission executed beyond the specified date would suffer a legal authority. What is ruled in Mrs. Rekha Mukherjee (supra) is not exactly what learned counsel Mr.Vakil contends. It was dealing with the situation where the date of return of Commission was not extended and the argument that Commission executed beyond specified date suffered the authority was accepted; rightly so, for the forgoing reasons.
8.4 Not being an adjudicatory authority, this Court is only concerned with the Letter of Request and is not concerned with the subsequent events impacting the scope of the request and therefore the argument that the Letter of Request cannot be acceded to in its present form because certain requisitioned documents have been made available to the Page 8 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER plaintiffs after the date of the request deserves no merits inasmuch as, this Court does not find any such amendment in the Letter of Request Court (supra) above referred.
8.5 Having regard to the ratio in case of State of West Bengal (supra) that in absence of effecting Hague Convention by amendment in the relevant law, the Convention cannot be applied to the extent incompatible with the law of this country, it is held that Indian procedural laws will apply to this case.
8.6 So far as the issue of secrecy is concerned, it would be premature to answer the same at this stage. Needless to say that all the permissible objections can always be taken and dealt with under Indian procedural law during the evidence of the witnesses.
8.7 In view of the decision rendered in Bar Council of India Vs. A.K. Balaji and others [(2018) 5 SCC 379], it is not permissible for the legal representative other than the one enrolled as an advocate under the Advocates Act to practice and therefore the request of examination of witnesses by the named legal representatives of the parties to the suit is declined.
9. For the above reasons, the prayer made in Paragraph 12(a) is partly granted and the Principal District Judge, Surat, is appointed to record the evidence of witness Mr. Bakulbhai Limbasiya, Bhathwari Technologies on the topics indicated in appendix-A of the Letter of Request as also record the evidence of Mr. Chirag Limbasiya, Nouveau Diamonds LLP on the topics indicated in appendix-D of the Letter of Request. The evidence of both the witnesses shall be recorded in accordance with the Indian Procedural Laws using the Zoom videography platform, if available, and if found convenient, otherwise in person in a physical Page 9 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020 C/MCA/374/2020 ORDER Court. The evidence shall be recorded in English, if that language is known to the witnesses, otherwise in a local language. The exercise shall be completed within 30 days of the receipt of this order and immediately thereafter the Commission shall be returned to this Court in a sealed cover. Videograph if any, done by the Commissioner shall also be sealed and certified by the Commissioner under his seal and signature.
10. It will be open for the original plaintiffs and defendants to save the videographed evidence if done on the Zoom videography platform as also it will be open for the original plaintiffs and defendants to get the videography done if the evidence is recorded in the physical Court.
11. The witnesses and the parties shall appear in the first instance in a video conference to be hosted by the learned Principal District Judge, Surat, on 23.09.2020. The link and other details shall be forwarded by the learned Principal District Judge in advance, on the mobile or the e-mail address of the witnesses/parties, which may be supplied by them to the Registry of this court, and in turn, shall be forwarded to the learned Principal District Judge, Surat. The learned Principal District Judge, Surat, will then fix the calendar for executing the Commission. Soft copy of this order including the soft copy of the Letter of Request with annexures shall be made available to the learned Principal District Judge, Surat.
12. The applicants to deposit a sum of Rs.25,000/- initially with the Principal District Judge, Surat. It will be open for the applicants to deposit the said amount by electronic mode (swift) in the official account of the District Court, Surat; the details of account shall be made available to the applicants. Direct service through E-mail is permitted.
The application is disposed of.
(G.R.UDHWANI, J) MOHMMEDSHAHID/NIRU/SONGARA Page 10 of 10 Downloaded on : Fri Oct 16 04:49:25 IST 2020