Delhi District Court
Namrata Vaid vs . Amit Shroff & Anr. on 6 February, 2020
IN THE COURT OF MS VANDANA JAIN,
ADDITIONAL DISTRICT JUDGE07 (SE),
SAKET COURTS NEW DELHI
(MORE THAN SIX YEARS OLD CASE)
CS No. 7231/16
Namrata Vaid Vs. Amit Shroff & Anr.
In the matter of:
1. Smt. Namrata Vaid
D/o Sh. N. K. Vaid,
Proprietor of Culinary & Cake
Decorating School, A96,
Okhla Phase II, DDA Shed,
Near Crowne Plaza Hotel,
New Delhi110025 ...........Plaintiff
VERSUS
1. Sh Amit Shroff
CEO of 72interactive
D7, Vivek Vihar,
PhaseI, New Delhi110095
2. Smt. Shalini Shroff,
Proprietor of 72interactive,
D7, Vivek Vihar,
PhaseI, New Delhi110095 ........Defendants
Date of Institution : 23.09.2013
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Date of reserving of judgment : 24.01.2020
Date of Judgment : 06.02.2020
JUDGMENT
1. This is a suit for recovery of Rs. 5,00,000/ alongwith interest.
2. Brief facts of the case are that the plaintiff is an e commerce store dealing in all bakery ingredients, tools, cake decorating and cooking gadgets. The plaintiff is also the authorised distributor of brands such as Wilton, Kitchen Aid, Satin Ice etc. It is stated that the plaintiff online portal, allows all consumers to receive their required products at their doorstep. It is further stated that the plaintiff is also involved in giving cooking courses and have trained thousands of cooking enthusiast since 1995, being the only specialized school Namrata Vaid Vs. Amit Shroff & Anrs Page 2 of 37 for cake baking in India.
3. It is further stated that the defendant No.2 is the proprietor of 72 interactive which is involved in website designing, having its registered office at D7, Vivek Vihar, Phase I, New Delhi110095, providing ecommerce and content management solutions to business, seeking to maximize their brand potential across all digital media.
4. It is further stated that the plaintiff being an e commerce business by the name of www.ccdsshop.com, practices all their transaction comprising of sale of products online vide the website since 15.03.2013. Namrata Vaid Vs. Amit Shroff & Anrs Page 3 of 37
5. It is further stated that in furtherance to the same, the defendant no.1 who is the CEO of 72interactive, approached the plaintiff to provide services and accordingly plaintiff and Defendant entered into a contact dated 02.03.2013 by which the defendant had to design the website of the plaintiff for the utility of business transaction.
6. It is further stated that as per the said contract, the plaintiff made the payment of Rs.50,000/ towards the defendant. It is further stated that as per the said contract, the work to be done by the defendant was to be completed in 25 days, starting from 02.03.2013 but to total dismay of the plaintiff, the work done by the defendant was never completed on time or as per the contract.
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7. It is further stated that the defendants with the most ulterior motive, delayed in performing their part of contract on one excuse or the other, causing business loss to the plaintiff and his valuable customers. It is further stated that when substantial time had elapsed, the plaintiff asked the reason for such a delay from the defendants to which the defendant no.1 with the most malafide and arm twisting intentions elaborated a demand of another Rs.10,000/ in his email dated 24.03.2013, claiming that the required work stands outside the contract and plaintiff agreed to pay the same under forced circumstances but in order to ensure completion of work, plaintiff withheld the said amount of Rs. 10,000/.
8. It is further stated that during this time, the Namrata Vaid Vs. Amit Shroff & Anrs Page 5 of 37 defendant with the intention to extract aforesaid payment from the plaintiff, closed down the website of the plaintiff on which the whole business was dependent.
This act of the defendant caused the business of the plaintiff to go on a total loss for more than 10 days i.e. from 22.07.2013 to 05.08.2013, which further also accounted on complaints from the customers of the plaintiff for the reason that they could not get supplies as per their requirements as the website was not functioning.
9. It is further stated that the plaintiff for the reason of loss of health incurred around Rs.50,000/ per day which in total amounted to Rs.5,00,000/. Namrata Vaid Vs. Amit Shroff & Anrs Page 6 of 37
10. It is further stated that the defendant aggravated the situation further. After the plaintiff managed to put the website on track i.e. in working mode, the defendant no.1 stole the plaintiff's 2000 clients email id from their website and sent a defamatory mail to all of them on 22.07.2013, calling the plaintiff a thief. It is further stated that he also posted defamatory comments on the Facebook profile page of the plaintiff on 22.07.2013, which is followed by almost 1,40,000 people. It is further stated that defamatory act of the defendant did not stop there and he further went on to post defamatory comments about the plaintiff on website like JUST DIAL which is visited by lakhs of people every day and infact is the main source of information by which the customers are informed of the plaintiff's business.
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11. It is further stated that the plaintiff sent a legal notice to the defendant no.1 to which the defendant no.1 made a counterblast reply stating frivolous facts.
12. It is further stated that being aggrieved by the same, the plaintiff approached the Police Station at Okhla on 08.08.2013 and got registered a complaint against the defendant no.1 but police did not take any action till date. It is further stated that the non cooperation showed by the Police Officials has further hurt the plaintiff. This suit has been filed for recovery of Rs.5,00,000/ for damages.
13. Written statement was filed by defendant wherein, it is stated that that the plaintiff has not placed on record a single document in support of her Namrata Vaid Vs. Amit Shroff & Anrs Page 8 of 37 averment that Ms. Namrata Vaid is the proprietor of M/s. Culinary & Cakes Decorating School. It is further stated that agreement dated 2nd March 2013 was entered in to between Ms Ayesha of M/s. CCDS Bakers Warehouse and Mr. Amit Shroff for M/s. 72Interactive.
14. It is further stated that the present suit is bad for misjoinder of parties. It is further stated that the defendant no.2 is not the proprietor of the said concern and is only the Chief Executive Office of the Defendant No.1 Concern. It is further stated that the defendants have filed a copy of the Service Tax registration form ST2 along with the present replication in support of the averment that Defendant no.2 is not the proprietor of M/s 72interactive.
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15. It if further stated that the plaintiff has not disclosed to Court that on 19th July 2013 the plaintiff changed the access codes of the website and therefore, denied access to the defendants to modify/make changes as requested by the plaintiff. It is further stated that by changing the access codes and denying the access of the source code to the defendants without first clearing the amount that was due to be paid to the defendants amounts to misappropriation and infringement of defendant's copyrights in the source code of the software program.
16. It is stated that time and again the plaintiff sought to include functionalities and modules which were clearly beyond the scope of the project. It is stated that defendant time and again sent reminders to the plaintiff Namrata Vaid Vs. Amit Shroff & Anrs Page 10 of 37 and her employees regarding approvals, however the same fell on deaf ears.
17. It is further stated that the consideration as mentioned agreement dated 2 nd March 2013 was Rs.50,000/ and in addition to that taxes/government levies as applicable to the services rendered were to be borne by plaintiff. It is further stated that any work not specified in the said agreement would be estimated separately as per the terms of the agreement. It is further stated that the plaintiff has till date withheld the payment of taxes and the cost of the additional out of the scope work. It is further stated that 25 days time to complete the work as mentioned in the agreement days was based on the premise that the defendant and the plaintiff work together in a timely manner but the delay Namrata Vaid Vs. Amit Shroff & Anrs Page 11 of 37 was caused due to non responsiveness of the plaintiff and her employees as evidenced by the email reminders regarding the approvals required at each stage of the work.
18. It is further stated that defendants had no intention to cause losses to the plaintiff. It is further stated that the defendants in good faith made several additions to the project as requested by the plaintiff at no cost, even though the same were clearly out of the scope of the agreement entered into between the defendants and the plaintiff. It is stated that vide email dated 24th May 2013, the plaintiff agreed to the extra cost of Rs.10,000 for implementing a function called the "Multi Category Listing" which was clearly beyond the scope of the initial project proposal. It is further stated Namrata Vaid Vs. Amit Shroff & Anrs Page 12 of 37 that till date Rs.17,461/ remains unpaid to the defendants.
19. It is further stated that defendant in a desperate effort to caution the public of the plaintiff's legal acts, posted on his personal Facebook page as well as on Just Dial the nature of the illegal acts done by the plaintiff. It is further stated that defendant no. 2 was simply exercising his freedom of speech and expression and the same can not be subjected to censorship of the plaintiff. It is further stated that the comments of the defendant on various forum do not amount to defamation as the same are founded in truth. It is further stated that the facts and circumstances of the present case and the nature of the comments posted by the defendant no. 2 are the absolute truth and therefore, no claim of Namrata Vaid Vs. Amit Shroff & Anrs Page 13 of 37 defamation can be raised on the basis of the said comments.
20. Replication to the written statement filed by the plaintiff wherein contents of the written statement were denied and contents of the plaint were reiterated.
21. After completion of the pleadings, following issues were framed vide order dated 20.07.2016.
1. Whether this court has no territorial jurisdiction to try and entertain the present suit ? OPP
2. Whether the publication carried out by defendants is defamatory? OPP
3. Whether the plaintiff is entitled to damages alongwith interest, as prayed for ? OPP Namrata Vaid Vs. Amit Shroff & Anrs Page 14 of 37
4. Whether the plaintiff is entitled to decree of permanent injunction, as prayed for ? OPP
5. Relief.
22. Thereafter, matter was listed for plaintiff's evidence. Plaintiff examined herself as PW1. Thereafter, PE was closed.
23. Thereafter, matter was listed for defendant's evidence. Defendant examined himself as DW1. Thereafter, DE was closed.
24. Thereafter, matter was listed for final arguments.
25. Ld. Counsel for the plaintiff has argued that the Namrata Vaid Vs. Amit Shroff & Anrs Page 15 of 37 plaintiff is running an ecommerce business by the name of www.ccdsshop.com, and sells it products online apart from giving cooking classes. It is stated that it is a ecommerce store dealing in all bakery ingredients, tools, cake decorating and cooking gadgets. Defendant no. 2 is the proprietor of 72 interactive and is involved in website designing. An agreement dated 02.03.2013 was executed between the plaintiff and the defendant to provide services by designing the website of the plaintiff for the utility of the business transaction. As per the contract, the payment of Rs. 50,000/ was made and the work was to be completed within 25 days.
26. Ld. Counsel for the plaintiff has argued that to the utter dismay of the plaintiff, the work was never Namrata Vaid Vs. Amit Shroff & Anrs Page 16 of 37 completed on time and after lapse of substantial time, the defendant no. 1 demanded another sum of Rs. 10,000/ in his email dated 24.03.2013 claiming that the required work stands outside the contract which the plaintiff was forced to agree to, however, this payment of Rs. 10,000/ was kept on hold in order to see the successful working of the website.
27. Ld. Counsel further argued that during this time, the defendant closed down the website of the plaintiff on which the whole business of the plaintiff was dependent thereby causing a loss of business for 10 days to the plaintiff from 22.07.2013 till 05.08.2013. The plaintiff was put to such mental agony that it led to the deterioration of the health of the plaintiff which caused a loss of around Rs. 50,000/ per day totalling Namrata Vaid Vs. Amit Shroff & Anrs Page 17 of 37 Rs. 5 lacs.
28. It is further argued that the plaintiff had to hire other specialist to put the website back on track and working mode which further costed Rs. 30,000 to Rs. 35,000/.
29. Ld. Counsel further submits that this did not stop here and the defendant sent a threat mail dated 22.07.2013 to the plaintiff threatening as under: "...........just changing the FTP & Database Password will not help. We can still put it down till you don't pay our dues".
30. Ld. Counsel further submits that he stole plaintiff's 2000 clients email ID from their website and sent a Namrata Vaid Vs. Amit Shroff & Anrs Page 18 of 37 defamatory mail to all of them on 22.07.2013 by calling plaintiff a thief. It is also stated that he posted a defamatory contents on the facebook profile page of the plaintiff on the same date which is followed by almost 1,40,000 people and simultaneously put the defamatory contents on the website like Just Dial which further caused grievances to the plaintiff.
31. Ld. Counsel has argued that the defendant is liable to pay damages of Rs. 5 lacs along with interest and therefore the suit be decreed.
32. On the other hand, Ld. Counsel for the defendant has argued that the defendant's office is in Vivek Vihar and therefore this Court has no territorial jurisdiction to try and entertain the present suit. It is further argued Namrata Vaid Vs. Amit Shroff & Anrs Page 19 of 37 that the plaintiff has herself admitted that an amount of Rs. 10,000/ was not paid. It is argued that the plaintiff has concealed the material facts that on 19.07.2013, plaintiff changed the access codes of website and denied access to the defendants to make further changes.
33. It is further argued that it was the plaintiff who caused the delay and she wished to include functionality which were clearly beyond the scope of project. Ld. Counsel submits that repeated correspondences were made with the plaintiff in order to clear the outstanding dues and for approvals but no response was received. It is further argued that defendant being a sufferer, in a desperate effort to caution the public of the illegal acts of the plaintiff, put Namrata Vaid Vs. Amit Shroff & Anrs Page 20 of 37 the said acts of plaintiff on the profile facebook page of the plaintiff and on Just Dial.
34. It is further argued that the present case does not fall under the scope of defamation and the defendant had only exercised his right of freedom and speech and expression as the contents of the post were founded in truth.
35. I have heard the arguments and have perused the record carefully.
36. Issue No. 1. Whether this court has no territorial jurisdiction to try and entertain the present suit ? OPP Namrata Vaid Vs. Amit Shroff & Anrs Page 21 of 37 Onus to prove this issue was upon defendant. Defendant has stated that agreement was signed in Noida whereas plaintiff has stated that agreement between the parties has been signed at Okhla. Perusal of record shows that present suit is for damages on account of publishing defamatory material on facebook page and on just dial. It is the case of the plaintiff that alleged defamatory contents has also been forwarded to plaintiff's 2000 clients through email. It is specifically stated in para no. 17 of the plaint that plaintiff has been subjected to defamation and ridicule on account of defendants within the territory of this court. Since the Facebook page can be accessed anywhere in or out of Delhi, therefore, putting of impugned wrong/defamatory contents on the internet amounts to circulation at all the places. Reliance is placed upon Namrata Vaid Vs. Amit Shroff & Anrs Page 22 of 37 M/s Frank Finn Management Consultants Vs Subhash Motwani & Ors 2008 (154) DLT 95. This court is well within its jurisdiction to decide this suit. Therefore, this issue is decided in favour of plaintiff and against defendant.
37. Issue No. 2. Whether the publication carried out by defendants is defamatory? OPP
38. The present suit has been filed for seeking damages on account of publishing defamatory contents by defendant against plaintiff.
39. Certain admitted facts in the present case are that : Namrata Vaid Vs. Amit Shroff & Anrs Page 23 of 37
(a) Both the parties entered into an agreement dated 02.03.2013 by which defendant was to design website of the plaintiff for the utility of the business transaction for which Rs. 50,000/ was paid by the plaintiff to the defendant as per said contract.
(b) The said contract was to be completed within 25 days.
(c) Defendant no. 1 raised a demand of extra Rs. 10,000/ by way of email dated 24.03.2013.
(d) In para no. 6 of the plaint, it is admitted that plaintiff agreed to pay the said amount.
(e) In the same paragraph no. 6, it is also admitted that said amount of Rs. 10,000/ was not paid.
40. Plaintiff stated that defendant closed down the Namrata Vaid Vs. Amit Shroff & Anrs Page 24 of 37 website of the plaintiff on which the whole business of the plaintiff was dependent whereas the stand of the defendant is that first of all plaintiff caused delay in approving functionalities of the website at various stages of its development and thereafter plaintiff sought to include functionalities and modules which were clearly beyond the scope of the project. The very fact that plaintiff agreed to pay extra Rs. 10,000/ to the defendant shows that something beyond the scope of project was to be done as nothing has been filed on record or has been proved by plaintiff in order to show that defendant was not entitled to receive extra Rs. 10,000/.
41. It is further the case of the defendant that on 19.07.2013, plaintiff changed the access codes to the Namrata Vaid Vs. Amit Shroff & Anrs Page 25 of 37 website denying the access to the defendant to modify or alter the changes. In the cross examination of PW1, she denied the suggestion that access code of the website was changed by plaintiff or by any of the representative of the CCDS. She voluntarily stated that it was changed by the defendant. Be the case as it may, it has not come on record as to who changed the access code and whether it was possible for the plaintiff or for the defendant to change the access code. At the same time, it is not proved on record that website of plaintiff was shut for a certain time period. The stand taken by plaintiff is that she had to incur extra cost of Rs. 30,000/ to 35,000/ to get back the website on track by appointing some other professional is also not proved. During her cross examination, she had stated that one AOne Site Solutions has done the remaining Namrata Vaid Vs. Amit Shroff & Anrs Page 26 of 37 work, however, no such evidence has been filed on record. Therefore, from the record it is very much clear that plaintiff was bound to pay Rs. 10,000/ to the defendant which was never paid as stated by plaintiff herself in the plaint. With this background, let us see what is the impugned defamatory material is on record. Plaintiff has filed print out of facebook page wherein it was mentioned that: "CCDS refuses to pay dues of 72interactive. We are surprise to work with unprofessional companies like CCDS."
"Nope bhai its Culinary & Cake Decorating Store #CCDS big cheats. They are in business of cheating people, whether its customer, vendors or students..."
42. Then again on Just Dial, it was mentioned that: "Extremely unprofessional company. We helped Namrata Vaid Vs. Amit Shroff & Anrs Page 27 of 37 them build a world class eCommerce store, where in their daily billing was min 50k, but even after complete support and help. They cheated us and refused to pay our dues. I am sure they must have done this with other vendors as well, since they had come to us after martjack and some other vendor. I would neither recommend vendors, students or people to trade with them."
43. Though, it is stated that email was also sent to 2000 clients of the plaintiff, however, this has not been proved on record. There is no list of clients of the plaintiff on record and further no one has been summoned by plaintiff in order to show that any such email was received by any client. Therefore, in total we have two alleged defamatory contents on record. One of facebook page and another on just dial which were Namrata Vaid Vs. Amit Shroff & Anrs Page 28 of 37 admitted to have put there by the defendant.
44. With this background of merits, let us dwell upon Section 499 of IPC which defines defamation: "Whoever, by words either spoken or intended to be read, or by signs or by visible representations, makes or publishes any imputation concerning any person intending to harm, or knowing or having reason to believe that such imputation will harm, the reputation of such person, is said, except in the cases hereinafter expected, to defame that person. Explanation 1.--It may amount to defamation to impute anything to a deceased person, if the imputation would harm the reputation of that person if living, and is intended to be hurtful to the feelings of his family or other near relatives.
Explanation 2.--It may amount to defamation to Namrata Vaid Vs. Amit Shroff & Anrs Page 29 of 37 make an imputation concerning a company or an association or collection of persons as such. Explanation 3.--An imputation in the form of an alternative or expressed ironically, may amount to defamation.
Explanation 4.--No imputation is said to harm a person's reputation, unless that imputation directly or indirectly, in the estimation of others, lowers the moral or intellectual character of that person, or lowers the character of that person in respect of his caste or of his calling, or lowers the credit of that person, or causes it to be believed that the body of that person is in a loathsome state, or in a state generally considered as disgraceful."
45. Certain exceptions has been carved out to this section so as to provide freedom of speech and expression.
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46. IX to Section 499 is provided as under: "Imputation made in good faith by person for protection of his or other's interests.--It is not defamation to make an imputation on the character of another provided that the imputation be made in good faith for the protection of the interests of the person making it, or of any other person, or for the public good."
47. In Standard Chartered Bank Vs. Vinay Kumar Sood & Ors 2009 SCC OnLine Del 277, the scope of exception IX to section 499 IPC was discussed which is as under: "9. 9th Exception of the Section takes away the imputation made in good faith by a person for protection of his or other‟s interest or Namrata Vaid Vs. Amit Shroff & Anrs Page 31 of 37 for public good from the purview of defamation as defined in the Section. This exception relates to private communication which a person makes in good faith for the protection of his own interest. This exception covers not only such allegations of facts as can be proved true but also expression of opinions and personal inferences.
10. 9th exception has been incorporated to protect the interests of the parties in their business transaction which are generally done bonafidely and, therefore, the rule of public good on which this principle is based is, that honest transaction of business and social intercourse would otherwise be deprived of the protection which they should enjoy.
11. Whether any imputation made is with a motive or malafide intention to lower the reputation or is made in good faith is to be determined from the facts and circumstances of the case. Undisputedly, the requirement of good Namrata Vaid Vs. Amit Shroff & Anrs Page 32 of 37 faith and public good, both, are to be satisfied and the failure to prove good faith would exclude the application of 9th exception in favour of the accused even if the requirement of public good is satisfied. The words „good faith‟ as appearing in exception 9th not only require logical infallibility but also due care and attention.
12. The court has to consider as to how far erroneous actions or statements are to be imputed for want of due care and caution in a case in reference to the general circumstances, the capacity and intelligence of the person whose conduct is in question. It is difficult to lay down any hard and fast rule for deciding whether an accused acted in good faith within the meaning of 9th exception, as it is an issue to be considered on the facts and circumstances of each case, nature of imputation made, the circumstances under which it was made, the status of the person who made it, and if there Namrata Vaid Vs. Amit Shroff & Anrs Page 33 of 37 was a malice in his mind when he made such imputation, whether he made any inquiry before any such imputation was made and if there were reasons to accept his story, that he acted with due care and attention and was satisfied that imputation was true.
13. In "Harbhajan Singh v. State of Punjab, (1965) 2 SCR 235", Exception 9 of Section 499 IPC has been interpreted in para 20 and 21 as follows: "20. Another aspect of this requirement has been pithily expressed by the Bombay High Court in the case of Emperor v.Abdool Wadood Ahmed."Good faith," it was observed "requires not indeed logical infallibility, but due care and attention. But how far erroneous actions or statements are to be imputed to want of due care and caution must, in each case, be considered with reference to the general circumstances and the capacity and intelligence of the person whose conduct is in question".
"it is only to be expected", says the judgment, "that the honest conclusions of a calm and philosophical mind may differ very largely from Namrata Vaid Vs. Amit Shroff & Anrs Page 34 of 37 the honest conclusions of a person excited by sectarian zeal and untrained to habits of precise reasoning. At the same time, it must be borne in mind that good faith in the formation or expression of an opinion, can afford no protection to an imputation which does not purport to be based on that which is the legitimate subject of public comment."
48. With this background of law in mind, it can be safely observed that since payment of Rs. 10,000/ was not made by plaintiff to defendant, therefore, out of frustration, this content was put on the facebook page. The factum of nonpayment as was put on the internet was a truth and the defendant felt cheated due to non payment, that's why he posted the said material on the site. It is safe to conclude that the alleged defamatory contents was the honest conclusion of defendant about the nature of plaintiff. Exception IX clearly covers the same as defendant had put the said material on record Namrata Vaid Vs. Amit Shroff & Anrs Page 35 of 37 in order to protect his own interest and to inform the public about his own experience. The aforesaid content cannot said to be defamatory. Therefore, this issue is decided against the plaintiff and in favour of defendant.
49. Issue no. 3. Whether the plaintiff is entitled to damages alongwith interest, as prayed for ? OPP Since issue no. 2 is decided against the plaintiff, plaintiff is not entitled to any damages or interest. Hence, this issue is decided against the plaintiff.
50. Issue No. 4. Whether the plaintiff is entitled to decree of permanent injunction, as prayed for ? OPP During the disposal of the application under Namrata Vaid Vs. Amit Shroff & Anrs Page 36 of 37 Order 39 Rule 1 and 2 CPC on 11.12.2013, it is recorded that defendant is no longer doing so and in view of this submission of Ld counsel for defendant, interim application was allowed.
In view of findings given in issue no. 2 and since there is no further complaint of posting any material anywhere by defendant, there is no necessity of passing any direction against the defendant. Thus, this issue is decided accordingly.
51. Relief: Suit of the plaintiff is dismissed.
52. Decree sheet be prepared accordingly. File be consigned to Record Room after due compliance. Digitally signed by VANDANA
Announced in the open VANDANA JAIN
JAIN Date:
court on 06.02.2020 2020.02.07
14:54:56 +0530
(VANDANA JAIN)
ADJ07/SE/SAKET COURTS/
NEW DELHI/06.02.2020
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