Calcutta High Court
Hindustan Lever Limited vs Cavinkare Limited And Ors. on 16 July, 2003
Equivalent citations: 2004CRILJ349
Author: Kalyan Jyoti Sengupta
Bench: Kalyan Jyoti Sengupta
ORDER
1. This contempt application has arisen in connection with the petitioner's/plaintiffs action for infringement of their process patent of their product 'Fair and Lovely' skin cream. The petitioner sought various reliefs including damages against the respondents/defendants, and in connection therewith application for interlocutory relief was taken out and they were successful in obtaining order of injunction from this Court. However, that interim order of injunction was vacated on combined disposal of the suit and the interlocutory application. Good sense prevailed upon between the parties as they settled the dispute, involved in the suit, as well as the interlocutory application by filing the terms of settlement. The relevant clauses of the terms of settlement, which are germane in the contempt application, are set out hereunder.
"Clause 3 : Defendants Nos. 1 and 2 through Mr. T.A. Srinivasan, Company Secretary of the Defendant No, 1, give an undertaking to this Hon'ble Court not to manufacture and/or market either by themselves or by their servants, agents or assigns any fairness cream by using silicon compound in combination with the other ingredients converted in Patent No. 169917 of the Plaintiff namely Niacinamide, Parsol MCX, Parson 1789 with effect from 15th Sept. 2000.
4. The Defendant Nos. 1 and 2 through Mr. T.A. Srinivasan, Company Secretary of the Defendant No. 1, give an undertaking to this Hon'ble Court to exhaust all finished and semi finished FAIREVER Fairness Cream available with them at present and which may be manufactured till 14th Sept. 2000 in terms of Clause 3 above consisting of Silicone Compound on or before 30th Sept. 2000.
5. The plaintiff undertakes not to interfere with the sale of FAIREVER Fairness Cream manufactured on or before 15th Sept. 2000 containing Silicone Compound and lying with wholesalers, re-distribution stockist and retailers."
2. Once it was thought that the dispute and differences between the parties have come to an end but it reveals now in present contempt application the plaintiff alleges breach of undertaking. Now, it is being examined whether there is breach of the aforesaid Undertaking.
3. Before I examine the nature of the allegations, I would appropriately record that the aforesaid undertaking not only recorded in the signed document, namely the terms of settlement filed in Court, but the respondent No. 3 himself appeared before this Court and on oath, he accepted and acknowledged the aforesaid undertaking having been given to this Court.
4. The allegations of the petitioner is that the respondent No. 1 despite giving the said undertaking in deliberate and wilful breach thereof is continuing to manufacture and distribute 'fairever' cream containing same ingredients with the given range and is therefore blatantly infringing patent No. 16997. The above use of the ingredients in manufacturing and distributing of the respondent's cream is apparent and established by the chemical analysis report undertaken and prepared by the reputed and renounced chemists and laboratories of the respondent's finished product which was collected from the market.
5. On being satisfied with the prima facie evidence this Court passed various interlocutory orders. In the contempt proceeding itself this Court appointed Special Officers for collecting sample of finished product from various places and the samples thereof were tested by the independent chemical laboratories and the reports therefrom have been collected by the said Officer and produced before this Court. The Court issued Rule in this matter. Before the Rule could be served the respondents came with two applications for discharge of the Special Officer and for vacating interim order passed in this proceeding and further for discharge of the Rule. Therefore, this Court, though the Rule was not served but returnable date thereof, was extended from time to time thought it fit pending decision as to whether the Rule should be discharged on the plea that prima facie case of drawing up contempt proceeding has not been established, not to ask the alleged contemnors to be personally present. So, this Court has heard at length, on the preliminary question whether Rule should be discharged or not.
6. Mr. Dipankar Gupta, learned Senior Advocate with Mr. S. Pal, and Mr. Debal Banerjee, learned Senior Advocates has contended that the undertaking recorded in the written document namely 'terms of settlement' is of such a nature that can be meant to have been given to the parties/plaints/ petitioners not to Court though the word 'Court' mentioned but in essence this undertaking should be construed to have been given not to the Court. He contends that the breach of undertaking amounts to contempt, in the event the contemnor by making a false representation in the shape of undertaking to the Court obtains benefit for himself and if he fails to honour the undertaking he practices fraud on the Court itself and thereby obstruct the course of justice and bring judicial institution to disrepute. Moreover, it is contempt where there is breach of undertaking on oath on the faith of which the Court sanctions a particular course of action. In support of this contention he has relied on following authorities.
Nish Kanto Roy Chowdhury v. Smt. Saroj Bashini Goho.
Baburam Gupta v. Sudhir Bhasin.
Noorali Babul Thanewala v. Sh. K.M.M. Shetty.
7. Therefore, his contention is that whether there has been an undertaking given to the Court or to a party, or breach of which will amount to contempt, is a matter of construction of the language of the order. The plain meaning of the language is not the determining factor rather the circumstances under which such undertaking was given is to be found. Thus, in a given case the expression undertaking to Court may have been used but upon true construction it may be between parties inter se. Thus the Court must be involved in the undertaking. The Court must see that it is the recipient of the undertaking and having accepted the same, passed order before the contempt jurisdiction can be attracted.
8. In his alternative argument Mr. Gupta submits that even if it is held and construed by the Court that the undertaking having been given to the Court, then having regard to the complexity of this matter it would not be proper for this Court to draw up any proceeding to decide this matter. Numerous affidavits have been filed by these respondents placing their defence and evidences in support of their case. The petitioner has not been able to establish prima facie that there is breach of undertaking deliberately by the respondents. The petitioner cannot succeed on its own and it is fishing evidence and material, to sustain its case. He contends that fundamentally in order to succeed a contempt proceeding which is a quasi criminal nature the petition must disclose the act of contempt is willful and deliberate; there must be clear, cogent and unimpeachable evidence; that the charge must be brought home beyond all reasonable doubt; that mere probabilities would not be enough and that the Court does not take cognizance of technical contempt. In support of his submission he has relied on the numerous authorities of Supreme Court and those of this Court as follows :
Tapan Kumar Mukherjee, Jiwani Kumari Parekh, V. G. Nigam, Ashok Kumar Singh (1922) 1 SCC 152 : (1992 Cri LJ 284) (Para 10) Manish Gupta, Niaz Md., Choturam, Mritunjoy Das AIR 2001 SC 1293 : (2001 Cri LJ 1702) (Paras 13-18) Deben Adhicari, (1-985) Cri LJ 87 (Cal) (Para 4) AIR 1953 Madhya Bha 245, 246 : (1953 Cri LJ 1675) (FB) Motilal Ghose AIR 1914 Cal 69 : (1913 (14) Cri LJ 321) (SB).
9. His further contention is this that both the parties have filed their respective reports of the analysis and test of the product and this Court in summary jurisdiction will not be able to decide this matter as to whether there is any breach or not. Moreover, the way, report has been procured by the petitioner to charge them with the breach of undertaking is wholly unreliable as the same is based on ineffectual procedure and process. The petitioner has adopted standard operating procedure to find out use and existence of the silicon oil in the products of the respondents. It is extremely difficult, as it has been explained by the expert's affidavits of the respondents to find out the object. Therefore, when the fundamental basis of the experiment is flawed the entire result is also obviously erroneous and unacceptable. Thus, the petitioner has not been able to establish prima facie case of contempt nor any proof thereof.
10. Mr. Gautam Chakraborty, learned Senior Counsel submits that there is no dispute as regard the proposition that only upon construction and interpretation of the language and the surrounding circumstances the Court will judge whether the undertaking was given to the Court or to the parties. It depends upon facts and circumstances of each and every individual case. He contends that the language used in Clause 3 of the undertaking clearly mention that the same having been given to Court and there is no scope to misunderstand by any stretch of imagination that it was not given to any person other than Court particularly when the Court has accepted written undertaking after the same having been signed by the respondent No. 3 and same is also vouchsafed by him in Court in the witness box. He has cited the decisions of the Supreme Court and of this Court almost on the similar facts and circumstances of this case in support of his contention, : and ajudgment of the learned single Judge of this Court reported in (2002) 2 Cal HN 148.
11. He contends that at this stage it is not necessary to go into the evidence of this case, which has been produced by the petitioner. This can be examined after the Rule is served and contempt proceeding is sought to be contested. Therefore, the Court need not examine the standard or degree or sufficiency of the proof at this stage. Accordingly, he contends the Rule which has already been issued should be served and let the alleged contemnor appears in person and elect whether they are willing to defend the contempt proceeding by filing their affidavit, in the event the alleged contemnors decide to contest this proceeding then the petitioner will establish the case by producing sufficient evidence.
12. Extensive argument of both the sides have been advanced in this matter and at this stage this Court is concerned with as to whether the Rule already issued should be allowed to be proceeded with for full-fledged trial of the contempt proceeding or not. In other words whether Rule already issued will be discharged at this stage or not. Naturally interim order passed in this contempt proceeding should be vacated or not. The petitioner has also taken out further application for getting the sample collected by the special officer and tested to find out whether 'Fairever' cream contains any ingredient of the range prescribed in the patent of petitioner and which are undertaken not to be used by the respondents. At this stage the scope of the enquiry is very limited that is to say on reading of the language of the aforesaid clauses whether undertaking has been given to the Court or not, is to be found out.
13. Mr. Chakraborty and Mr. Gupta did not dispute the proposition if it is found undertaking having been given clearly to the Court and there is wilful breach there of certainly, contempt proceeding will lie. Both the learned counsels have relied on the Division bench Judgment of this Court rendered in case of Nisha Kanto Roy Chowdhury v. Saroj Bashini Goho . In that case the Division Bench while upsetting the order of eviction of the learned single Judge on the fact found there was no undertaking given to the Court and it was given to the parties. In that case the appellant purported to settle the suit on compromise. The tenant/appellant gave undertaking, which was embodied in the written agreement to remove certan images installed in the suit premises. On the basis of this agreement the suit was decreed on compromise. The Division Bench of this Court did not accept the argument of the landlord that since undertaking recorded in the agreement between the parties, which was ultimately accepted by the Court by passing a decree should be read and construed as having given to the Court although there was no specific expression in the clause to whom undertaking was given. The Court held that in such a situation it could not be held that undertaking given to the Court rather it was given to the party. However, the ratio laid down in the aforesaid judgment remains in later part of paragraph 20, which is quoted hereunder.
"...,..................It appears to me that each case must be decided on its particular facts and upon the precise words in the compromise under discussion and cases are not very helpful unless the words are precisely similar. In the present case, it appears to me, on a true construction of para 6 of the compromise, that there was nothing more than a solemn promise by the defendant to the plaintiff and the nature of that promise or undertaking could never be changed by reason of the compromise being accepted by the Court and a decree passed in its terms."
21. ......................If one of the terms of compromise is that one of the parties should be given an undertaking to the Court then the compromise should make it clear that such is the case. If it does not make it clear and the compromise merely states that one of the parties "undertakes" then the ordinary construction must be given that that is promise or solemn promise given to the other party and not to the Court."
14. In the case of Chhaganbhai v. Soni Chandu Bhai the Supreme Court proceeded with the contempt proceeding having found a cleat Undertaking given to the Court recorded in the form of a written agreement between the parties which was filed and accepted by the Court.
15. In the case of Noor Ali Babul Thanewala v. Sh. K. M.M. Shetty it was held that :
"When a Court accepts an undertaking given by one of the parties and passes order based on such undertaking the order amounts in substance to an injunction restraining that party from acting in breach thereof. The breach of an undertaking given to the Court by or on behalf of a party to a civil proceeding is, therefore, regarded as tantamount to a breach of injunction although the remedies were not always identical. For the purpose of enforcing an undertaking that undertaking is treated as an order so that an undertaking, if broken would involve the same consequences on the person breaking that undertaking as would their disobedience to an order for an injunction."
16. This Court in case Peerless General Finance and Investment Company Limited v. Bijoy Kumar Swalka reported in 2002 (2) Cal HN page 148 while analyzing the various judgments including , has held amongst others that "to charge a person for breach of undertaking one has to establish without any shadow of doubt that undertaking was given to the Court expressly or by necessary implication."
17. In case of Baburam Gupta v. Sudhir Bhasin it has been held amongst others that :
"it is manifest that any person appearing before the Court can give an undertaking in two ways : (1) that he files an application or an affidavit clearly setting out the undertaking given by him to Court, or (2) by a clear and express oral undertaking given by .................If any of these conditions are satisfied then a willful breach of the under-taking would doubtless amount to an offence under the Act. It is further observed in that same paragraph that : "There is a clear cut distinction between a compromise arrived at between the parties or a consent order passed by the Court at the instance of the parties and a clear and categorical undertaking given by any of the parties. In the former, if there is violation of the compromise or the order no question of contempt of Court arises, but the party has a right to enforce the order or the compromise by their executing the order or getting an injunction from the Court."
18. Mr. Gupta has cited various decisions of the Supreme Court in order to remind me that the contempt proceeding should be drawn up in a clear case of contempt, and sparingly, and the conviction should be recorded only on the standard of proof of beyond reasonable doubt and such burden of proof should be on the petitioner. According to him in this case even if the Rule is allowed to be heard the proof produced before this Court is not of such a standard or degree for which conviction can be recorded. Under these circumstances it would not be proper for this Court to proceed any more with the hearing of the Rule.
19. I think the aforesaid contention at this stage should not be judged. We should be concerned with for the time being, whether undertaking was given by his client to the Court or to the petitioner namely Mr. Chakraborty's client in terms of the agreement. The decisions cited by Mr. Gupta in support of his contention do not lay down that the Court will in certain cases, look into evidence or to assess the probabilities of success at the threshold. All those cases were rather dealt after the contempt proceeding had been drawn up and at the time of final hearing. I am of the view before issuance of the Rule the Court is concerned with prima facie allegations of breach of undertaking with particulars nothing more, nor any proof is required. I have already quoted language and wordings used in the compromise which has been accepted and received by this Court. The said agreement containing undertaking was not only signed by and on behalf of the respondent Nos. 1 and 2 the same were also accepted in Court on oath. The language of the aforesaid clause is absolutely clear and ambiguous, as the same has been given to Court not to the parties.
20. Both the parties keeping their minds open have recorded that the undertaking should be given to Court not to any of the parties and the Court has accepted the same by passing order pursuant thereto as the same has been given to it. In case of undertaking and/or compromise, given by one party to another the same can be enforced by their own action but when undertaking is given to the Court it can only be implemented by Court and not by anybody else. If it is found that the undertaking is breached deliberately and wilfully then obviously the contempt proceeding is the best method to deal with such situation. As I recorded my conviction the undertaking given to Court and from the averment in the petition I find the breach thereof is willful and deliberate, I issued Rule. So, I do not find any justification not to draw up the proceeding, or to discharge the Rule.
21. The petitioner has produced certain materials prima facie to substantiate the willful breach of the aforesaid undertaking at the instance of the Court further materials has been obtained by procuring independent evidence to see whether there is any substance in the allegations of the petitioner at least prima facie.
22. Therefore, I hold that this proceeding should be heard in usual method. I dismiss all the applications of Mr. Gupta's client for discharge of Rule or for other reliefs. Therefore, the Rule is made returnable one week after the Puja Vacation when the respondent would be entitled to take further defence as may be advised. Naturally, the application already filed by Mr. Chatterjee's client for chemical test of the sample collected by the Special Officer is allowed. Special officer is accordingly directed to get the same tested chemically.
23. Mr. Bose, learned counsel appearing for the alleged contemnors, submits that stay of operation of this judgment and order should be allowed.
24. I have considered his prayer and I do not find any reason to grant any stay as I have already extended the returnable date.