Madras High Court
Air 1954 Patna 492 (Rohtas Industries ... vs Indian Hume Pipe Company Limited) on 19 August, 2011
Author: S.Rajeswaran
Bench: S.Rajeswaran
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 19.08.2011 CORAM THE HON'BLE MR. JUSTICE S.RAJESWARAN A.No.5529 of 2010 in A.No.5166 of 2010 in C.S.No.801 of 2010 ORDER
This Application No.5529 of 2010 has been filed by the defendant in C.S.No.801 of 2010 to revoke the leave granted to the respondents/plaintiffs in A.No.5166 of 2010 on 16.09.2010 by this Court to file a suit before this Court and consequently return or reject the plaint.
2. C.S.No.801 of 2010 has been filed by the respondents/plaintiffs against this applicant/defendant, for a permanent injunction restraining the applicant/defendant herein from launching, making, selling, distributing, advertising, exporting, importing, offerng for sale and in any other manner directly or indirectly deal in any pharmaceutical or chemical compound products that infringes the Indian Patent No.196774 registered by the plaintiffs.
3. The case of the plaintiffs as stated in the plaint in brief is as follows:
The first plaintiff is the largest Bio-Tech Company and an Innovator of products and services for early detection and treatment of diseases. The second plaintiff specializes in the discovery and development of innovative molecular targeted therapies for patients suffering from life- threatening diseases. The second plaintiff entered into an agreement with Pfizer, Inc. on 1.04.1986 to conduct collaborative research in the field of cancer. This agreement was renewed and modified on 01.04.1991 and 01.04.1996. The research ultimately led to the discovery of a compound designated by Pfizer, Inc. as CP-358,774 an Epidermal Growth Factor Receptor Tyrosine Kinase (EGFR TK) inhibitor. On account of the acquisition of Warner Lambert by Pfizer, Inc., the Federal Trade Commission of the United States of America required Pfizer, Inc. to divest its rights in EGFR TK inhibitor compound. Accordingly Pfizer, Inc. returned all rights to the CP-358,774 compound to the second plaintiff by an agreement dated 23.05.2000.
4. Thereafter the plaintiffs 1 and 2 entered into an agreement on 08.01.2001 in which the first plaintiff was granted exclusive license outside United States to use, offer for sale and sell CP-358,774 compound which was eventually patented in India under Patent Number 196774 (suit patent). The plaintiffs 1 and 2 and Pfizer Products Inc. entered into an Exclusive License Agreement dated 04.09.2008 under which the first plaintiff was declared as exclusive licensee for Indian Patent No.196774 under the license agreement dated 08.01.2001. At the request of the first plaintiff, the license agreement dated 08.01.2001 and 04.09.2008 respectively were recorded by the Patent Registry. While so, Pfizer, Inc. had applied for a grant of patent in respect of the CP-358,774 compound filed application dated 13.03.1996. Subsequently, Pfizer Inc. has assigned the entire right to Pfizer Products Inc. who in turn has assigned one half share to the second plaintiff and these assignments were filed at the Patent Office on 7.11.2005. The patent application of the plaintiffs was also published in the Gazette inviting objections, if any. One Natco Pharma Limited filed a pre-grant opposition challenging the second plaintiff's patent application on 10.04.2007. After offering adequate opportunity to the second plaintiff and Nacto Pharma Limited, Indian Patent Office rejected the application filed by the said Company on 04.07.2007. Consequently on 06.07.2007 the Patent Certificate was issued for the Patent No.196774 by the Controller of Patents. Thus the second plaintiff and Pfizer Products Inc. are the co-owners of Patent No.196774 claiming ERLOTINIB HYDROCHLORIDE compound, which is an innovation in the treatment of cancer. The patent is administered in the form of tablet sold by the plaintiffs under the trade mark of 'TARCEVA' which is a registered one in the name of the second plaintiff. This trade mark has been approved by U.S. Food and Drug Administration in the year 2004. The said trade mark is also registered by the Central Drug Standard Control Organisation, Directorate General of Health Services and the Government of India in the year 2005.
5. Now the trade mark TARCEVA is available throughout the country. It is the case of the plaintiffs that a number of other companies like CIPLA Limited, NATCO, Dr.Reddy's Laboratories and Glenmark Pharmaceutical Limited attempted to infringe the Indian Patent No.196774 and to protect the IPR rights, they intiated suits in the High Court of Delhi and the suits are pending.
6. The plaintiffs in August 2010 received a notice from Intellectual Property Appellate Board, Chennai with regard to revocation filed by the defendant against the suit patent along with an application for stay. From the pleadings of the defendant the plaintiff came to know that the defendant intended to manufacture 'EROLTINIB HYDROCHLORIDE' compound without the due authorisation from the plaintiffs. Thus the plaintiffs claim that there is an infringement of the plaintiffs statutory rights by this defendant. The defendant has not in fact started the launching of their products. In the light of the impending lauch/intention of the defendant to infringe the Indian Patent No.196774, the present suit of the plaintiff is QUIA TIMET and the equities and the balance of convenience are in favour of the plaintiffs. The activities of the defendant would directly affect the statutory rights of the plaintiffs. Therefore the above suit has been filed by the respondents/plaintiffs for the aforesaid prayer.
7. Before numbering the suit, the plaintiff filed an Application in A.No.5166 of 2010 for obtaining leave to sue the defendant who are in Secunderabad, outside the jurisdiction of this Court. This Court on 16.09.2010 granted the leave as prayed for. Thereafter, the suit was numbered and on 17.09.2010 this Court in O.A.No.993 of 2010 granted an order of injunction ex-parte as prayed for, for a period of eight weeks and the order of injunction continues till date.
8. The respondent/defendant entered appearance through counsel and filed two applications, namely, A.No.5529 of 2010 to revoke the leave obtained by the plaintiff in A.No.5166 of 2010 from this Court and A.No.5530 of 2010 to vacate the order of interim injunction granted by this Court in O.A.No.993 of 2010 on 17.09.2010.
9. Now Application No.5529 of 2010 filed by the defendant to revoke the leave granted by this Court in A.No.5166 of 2010 on 16.09.2010 alone is argued and Application No.5530 of 2010 filed by the defendant to vacate the order of injunction granted by this Court would be taken up later in the event of the defendant fails in A.No.5529 of 2010.
10. A common affidavit was filed by the defendant in both the applications and the case of the defendant is as follows:
The case of the defendant is that leave has been obtained by the respondents/plaintiffs by misleading and misrepresenting the case before this Court. The defendant's registered office is located at Hyderabad and the Principal Office and the Manufacturing Unit are also in and around Hyderabad. The defendant has no office or manufacturing unit in Chennai and has no business activity establishing a nexus with Chennai whatsoever; whereas the respondents/plaintiffs are Foreign Corporations which are not based within the jurisdiction of this Court. The respondents/plaintiffs have executed a General Power of Attorney on 08.02.2009 mainly for instituting the infringement Suit in the High Court of Delhi. In 2009, the plaintiffs filed Infringement Suits against CIPLA, Dr.Reddy's Laboratories, NATCO and GLENMARK in New Delhi, all of whom, unlike the applicant, were manufacturing a competing product. The Delhi High Court has not granted any interim ex-parte stay in all the four suits. Though the defendant has no operations in Chennai, the respondent/plaintiff filed an application for leave and filed a suit before this Court. A mere statement by the defendant that they have intended to commercially make/use/sell/distribute a generic version of 'EROLTINIB HYDROCHLORIDE' all over India cannot give rise to a cause of action of infringement. However, the plaintiffs appear to have taken the defendant's statement in a revocation petition filed by them on 30.04.2010 before the Intellectual Property Appellate Board, Chennai. But, that statement was made by the defendant in the revocation application before the Appellate Board under Section 64 of the Patents act to show they were the person interested. As per Section 48 of the Patents Act, 1970, the cause of action must include some act done. Till date, the defendant had not performed any act which would amount to the infringement of the plaintiffs patent No.196774. As on date, the defendant does not make/use/offer for sale/sale or import for commercial purposes, the plaintiffs product patent No.196774, within the jurisdiction of this Court or for that matter anywhere in India. Whileso, the plaintiffs have mis-represented and suppressed the fact before this Court and obtained leave only to harass this defendant. Further, it is stated that the defendant has made submissions of their intention to commercialize similar to the one made in the revocation petition on 30.04.2010 before the Intellectual Property Appellate Board on other occasions in the past. Particularly, the defendant has made similar statements in their successful post-grant opposition against the first plaintiff for the revocation of Indian Patent No.207232 for the product 'VALGANCICLOVIR' as early as 28th June 2007. Till date, the first respondent/plaintiff never initiated any infringement action based on such statements, as it is well established that a party seeking to file a post-grant opposition under Section 25(2) of the Patents Act, 1970 or a revocation petition under Section 64 of the Patents Act, 1970 must establish that they are the person interested in for the purpose of Patents Act, 1970 is concerned. Thus, the plaintiffs have adopted a double standard and they do not truly believe that the statement of interest to commercialize can amount to cause of action of infringement of its patents. Therefore, their application for leave to sue is motivated and a mere statement expressing interest in manufacturing and marketing a patented product cannot constitute a cause of action of infringement. Thus, the defendant's statement before the Intellectual Appellate Board cannot confer a territorial jurisdiction upon this Court to file a pre-emptive infringement suit. Further, the plaintiffs, in their application for leave, has merely stated that this defendant might utilise the services of LOTUS LABS which is situated in Chennai for Research on 'EROLTINIB HYDROCHLORIDE' products. They have not stated that this defendant is currently conducting any Clinical Testing or Studying on the representations of the patented plaintiff's products. The Managing Director of said LOTUS Laboratory Private Limited has also submitted a statement that their laboratory is not involved in the testing of the product relating to IN-196774 for or on behalf of the defendant, the invention, for which, the suit is filed. According to the defendant, even assuming that the defendant is conducting research on the defendant's patented product with LOTUS Laboratory in Chennai, such research is expressly excluded from constituting an act of infringement under Section 107(A)(a) of the Patents Act, 1970. As a result, no cause of action for infringement can arise from such research/testing. Therefore, if there is no cause of action, then, the grounds for seeking leave will have to fail. The plaintiffs are merely engaging in speculative litigation which is unsupported by any true cause of action and it is intended solely to harass the defendant. Therefore, besides being no part of cause of action in infringement has arisen in Chennai, the applicant's entire operations are in Hyderabad, Andhra Pradesh. Instead of agitating their rights in the appropriate forum, the plaintiffs have chosen to file a suit before this Court only with ulterior motives. Hence, the leave obtained by the plaintiffs before this Court has to be rejected, as the defendant has been put to significant inconvenience at the instance of the plaintiffs. Therefore, there is total lack of jurisdiction to file the leave to sue application and the same is liable to be dismissed. Hence, the defendant prayed for revocation of the leave granted in A.No.5166 of 2010 in the above suit.
11. I have heard Mr.Aravind Datar, learned senior counsel appearing for the plaintiffs and the learned counsel appearing for the defendant. I have also gone through the documents made available on record.
12. The learned senior counsel for the plaintiffs submits that the defendant has gone before the Intellectual Patent Appellate Board at Chennai and filed a Revocation Petition wherein they have specifically stated that they are the persons interested and therefore, a part of the cause of action has definitely arisen in Chennai, within the jurisdiction of this Hon'ble Court and therefore, leave has been rightly granted by this High Court.
13. In support of his submissions, the learned senior counsel relied on the following judgments:
1.AIR 1954 PATNA 492 (Rohtas Industries Limited and others vs. Indian Hume Pipe Company Limited)
2.JT 2001 (1) SC 287 (Rajasthan High Court Advocates Association vs. Union of India and others) 3.2002 (1) SCC 567 (Union of India and others vs. Adani Exports Limited and another) 4.2008 (1) SCC 618 (Laxman Prasad vs. Prodigy Electronics Limited and another)
14. Per contra, the learned counsel for the defendant strenuously contended that the filing of the revocation petition before the Board would not make out a cause of action for filing the suit. Referring to the averments contained in the affidavit filed in support of the revocation application, the learned counsel for the defendant points out that a false statement has been made by the plaintiffs by stating that the defendant is going to infringe the products in the Laboratory situated in Chennai. He further submits that there is no intention nor they have done anything with regard to patending the product and in fact produced a letter given by the lab stating that no such activity is going on in the lab. Therefore, according to the learned counsel for the defendant when the product is neither made, nor manufactured, nor sold, it is not appropriate for the plaintiffs to come before this Court to file the above suit to harass the defendant. In support of his submissions, the learned counsel for the defendant relies on the following judgments:
1.1983 (3) PTC 245 DEL (Ajay Industrial Corporation, Delhi vs. Shiro Kanao of Ibaraki City, Osaka, Japan)
2.MANU/TN/2056/2007 (Parle Products Private Limited represented herein by its Area Sales Manager, South Zone A.Syed Malange Basha and Surga Food and Agro Limited vs. Parle Products Private Limited)
3.MANU/DE/1198/2008 (P.M.Diesel Limited vs. Patel Field Marshall Industries)
15. In so far as the judgment of the Patna High Court reported in AIR 1954 PATNA 492 (cited supra) referred to by the learned senior counsel for the plaintiffs, the learned counsel for the defendant submits that the judgment could not be relied upon to the facts of the present case, as in the Patna Judgment the defendant manufactured the product and stopped it latter after selling it. Therefore, the Patna High Court came to the conclusion that there was a definite threat and intention on the part of the defendant to infringe the product of the plaintiff and only in that context, the observation was made and the same could not be applied to the facts of the present case.
16. I have considered the rival submissions carefully with regard to facts and circumstances of this case.
17. In the light of the above facts and circumstances and in the backdrop of the arguments advanced by both the learned counsel, the only question that arises for consideration is whether the leave granted by this Court in A.No.5166 of 2010 is to be revoked or not.
18. The case of the plaintiffs is that, they have the Patent No.196774, which relates to the compound 'EROLTINIB HYDROCHLORIDE', the authority of which is confirmed in their favour. This product has been marketed by them in the name of TARCEVA tablets in every country including India for several years. Whileso, the plaintiffs received a notice from IPAB in the Revocation Petition filed by the defendant, wherein the defendant intended to commercially make/sell/distribute/market the very same compound which is the subject matter of the suit patent. Therefore, they have filed the present suit for the reliefs stated therein. In so far as the cause of action that arises for the territorial jurisdiction of this Court is concerned, it is stated by the plaintiffs that in view of the notice received by them from the IPAB in Chennai filed by the defendant, they have within their right to approach this Court to sue in Chennai by getting the leave of this Court as the defendant is situated in Andhra Pradesh State.
19. However, this was sought to be assailed by the defendant by contending that mere filing of the revocation petition in the IPAB, Chennai, will not give rise to a cause of action for the plaintiffs to approach this Court, as the defendant is situated elsewhere, they do not make the product in Chennai nor they sell the product also and in such circumstances, this exercise of the plaintiffs' is a speculative litigation which could not be permitted by this Court.
20. In so far as the case in hand is concerned, the arguments advanced on behalf of the defendant appears to be that there is no cause of action for filing the suit itself, as mere filing of revocation petition before the IPA Board will not give rise to a cause of action at all for the plaintiffs to file an infringement suit before this court. However, I am not dealing with an application filed under Order VII Rule 11 to reject the plaint for want of cause of action.
21. This Court has to consider whether there is any territorial jurisdiction for this Court to entertain the above suit and for that purpose, what is necessary is to find out whether any cause of action or part of the cause of action has arisen in Chennai and within the jurisdiction of this Court.
22. The undisputed fact is that, a Revocation Petition has been filed by the defendant before the IPAB, Chennai, wherein they have clearly stated that they place to manufacture and commercialize the drug 'EROLTINIB HYDROCHLORIDE' and the defendant proposes to use/offer for sale and sell in India as well as export the drug. It is further stated by them in the case filed before the IPA Board that the subject matter of the product is under a Patent No.196774 granted to the plaintiffs and the product is marketed in India under the brand name 'TARCEVA TABLETS'. The defendant has stated that they are actually inclined to make a NOVEL POLIMORPHIC form of the Compound 'EROLTINIB HYDROCHLORIDE'. While NOVEL POLIMORPHIC form of the compound is not covered under the Patent No.196774, there is every likelihood that the plaintiffs may institute infringement action against the defendant on the basis of the patent, eventhough the defendant would manufacture and market the NOVEL POLIMORPHIC form of the compound.
23. If that being so, I am of the considered view that there is a definite cause of action that has arisen in Chennai within the jurisdiction of this Court and therefore, the plaintiffs can file a suit before this Court against the defendant for infringement of their patent. It is another matter wherein the mere intention to make the product will give rise to a cause of action or not, which could not be gone into in an application filed to revoke the leave granted by the Court.
24. In the Patna High Court judgment, which was referred by the learned senior counsel for the plaintiffs, no doubt that there was an observation by the Patna High Court that even an intention is sufficient to initiate an infringement suit. However, as rightly pointed out by the learned counsel for the defendant, the facts are totally different, as in the Patna High Court judgment it was not in dispute that the defendant did manufacture the product of the plaintiffs and sold the same at the same time.
25. However, I am of the considered view that the question of considering the cause of action for filing the suit itself does not arise at this stage of going into the question of whether there is a part of cause of action that arises so as to enable the plaintiffs to file the suit before this Court. As already referred to by me, the defendant approached the IPA Board situated in Chennai and made their intention very clear that they wanted to produce a product which will not offend the product of the plaintiffs, but they filed the revocation petition on the apprehension that the plaintiffs would object to such a new product that may be manufactured and sold by them. This itself is sufficient as it is definitely a part of cause of action that arises in Chennai and within the jurisdiction of this Court and therefore, the leave granted by this Court in A.No.5166 of 2010 cannot be revoked.
26. In AIR 1954 PATNA 492 (cited supra), a Division bench of the Patna High Court held as follows:
"16. Mr.Advocate General appearing for the defendants has however contended that even if it be found that the defendant company did use for some time in the past the machines covered by the plaintiffs' patents that would not justify the grant of perpetual injunction agaisnt the use of those machines by them in future. According to his contention, even at the time when Mr.Bhide visited the factory there was no trace available in the premises of the defendants company of the machines covered by the plaintiffs patent. That is according to him sufficent to suggest that the defendants even if they had been using the machines covered by the plaintiffs patents previously had by that time given up using them and removed them from their premises. In those circumstances the plaintiffs are not entitled to an order of permanent injunction against the defendants. This contention, in my opinion, has got no substance. Once it is held, which I think has to be held in this case, that the defendants did use the machines covered by the plaintiffs' patents, there is at least a potential likelihood of those machines being used again in future and the rights of the plaintiffs secured to them under grants in their favour usurped. It is difficult if not impossible for any plaintiff to establish a case of infringement of patents by exactly proving the presence of the patented machines of the products manufactured out of them in the custody of the persons alleged to be responsible for the infringement. In my opinion even proof of an intention to infringe, apart from actual infringement, my justify an injunction to restrain the infringement provided it is established to the satisfaction of the Court that the alleged infringer, dealing what he is doing as a matter of substance, he is taking the invention claimed by the patent 'Dudgeon vs. Thomson', (1877) 3 AC 34 at p.44 (D); - 'Marconi's Wireless Telegraph Co. vs. Mullard Radio Valve Co. Limited', (1924) 41 RPC 323 at p.344 (E).
17. In that present case it is not said that the substance of the invention has been taken by the defendants. What is alleged on the other hand, is that the very inventions of the machines covered by the plaintiffs' patent were being used by the defendants and their allegation to that extent as already held is, in my opinion, proved beyond reasonable doubt."
27. No doubt, this case seems to support the case of the plaintiffs to some extent and as referred to by me earlier, the facts are totally different and this observation made by the Patna High Court could not be straightaway imported to the facts of the present case. Even otherwise as observed by me, I am not dealing with the question of whether there is any cause of action at all for filing the suit under Order VII Rule 11 and whether this court has got territorial jurisdiction or not is a question to be decided in these two applications.
28. In JT 2001 (1) SC 287 (cited supra), the Hon'ble Supreme Court held as follows:
"15. The expression similar to the one "in respect of cases arising in the districts of" as used in para 2 of the Presidential Order came up for the consideration of a four-Judges Bench of this Court in Nasiruddin v. State Transport Appellate Tribunal - MANU/SC/0026/1975 : [1976]1 SCR 505 . It was in the context of division of territorial jurisdiction between Allahabad and Lucknow Benches in Uttar Pradesh. This Court held :-
...the expression "cause of action" in an application under Article 226 would be as the expression is understood and if the cause of action arose because of the appellate order or the revisional order which came to be passed at Lucknow then Lucknow would have jurisdiction though the original order was passed at a place outside the areas in Oudh. It may be that the original order was in favour of the person applying for a writ. In such case an adverse appellate order might be the cause of action. The expression "cause of action" is well-known. If the cause of action arises wholly or in part at a place within the specified Oudh areas, the Lucknow Bench will have jurisdiction. If the cause of action arises wholly within the specified Oudh areas, it is indisputable that the Lucknow Bench would have exclusive jurisdiction in such a matter. If the cause of action arises in part within the specified areas in Oudh it would be open to the litigant who is the dominus litis to have his forum conveniens. The litigant has the right to go to a Court where part of his cause of action arises. In such cases, it is incorrect to say that the litigant chooses any particular Court. The choice is by reason of the jurisdiction of the Court being attracted by part of cause of action arising within the jurisdiction of the Court. Similarly, if the cause of action can be said to have arisen partly within specified areas in Oudh and partly outside the specified Oudh areas, the litigant will have the choice to institute proceedings either at Allahabad or Lucknow. The Court will find out in each case whether the jurisdiction of the Court is rightly attracted by the alleged cause of action.
...the expression "cause of action" with regard to a civil matter means that it should be left to the litigant to institute cases at Lucknow Bench or at Allahabad Bench according to the cause of action arising wholly or in part within either of the areas. If the cause of action arises wholly within Oudh areas then the Lucknow Bench will have jurisdiction. Similarly, if the cause of action arises wholly outside the specified areas in Oudh then Allahabad will have jurisdiction. If the cause of action in part arises in the specified Oudh areas and part of the cause of action arises outside the specified areas, it will be open to the litigant to frame the case appropriately to attract the jurisdiction either at Lucknow or at Allahabad.
Applications under Article 226 will similarly lie either at Lucknow now or at Allahabad as the applicant will allege that the whole of cause of action or part of the cause of action arose at Lucknow within the specified areas of Oudh or part of the cause of action arose at a place outside the specified Oudh areas. [Underlining by us]
17. The expression "cause of action" has acquired a judicially settled meaning. In the restricted sense, cause of action means the circumstances forming the infraction of the right or the immediate occasion for the action. In the wider sense it means the necessary conditions for the maintenance of the suit, including not only the infraction of the right, but the infraction coupled with the right itself. Compendiously the expression means every fact which it would be necessary for the plaintiff to prove, if traversed in order to support his right to the judgment of the Court. Every fact which is necessary to be proved, as distinguished from every piece of evidence which is necessary to prove each fact, comprises in 'cause of action'. It has to be left to be determined in each individual case as to where the cause of action arises. The Chief Justice of the High Court has not been conferred with the legislative competence to define cause of action or to declare where it would be deemed to have arisen so as to lay down artificial or deeming test for determining territorial jurisdiction over an individual case or class of cases. The permanent Bench at Jaipur has been established by the Presidential Order issued under Sub-section (2) of Section 51 of the Act. The territorial jurisdiction of the permanent Bench at Jaipur is to be exercised in respect of the cases arising in the specified districts. Whether the case arises from one of the specified districts or not so as to determine the jurisdiction competence to hear by reference to territory bifurcated between the principal seat and the Bench seat, shall be an issue to be decided in an individual case by the Judge or Judges hearing the matter if the question may arise in that regard. The impugned explanation appended to the Order of the Chief Justice dated 23rd December, 1976 runs counter to the Presidential Order and in a sense it is an inroad into the jurisdiction of the Judges hearing a particular case or cases pre-empting a decision to be given in the facts of individual case whether it can be said to have arisen in the territory of a particular district. The High Court is right in taking the view which it has taken."
29. In 2002 (1) SCC 567 (cited supra), the Hon'ble Supreme Court held as follows:
"16. It is clear from the above constitutional provision that a High Court can exercise the jurisdiction in relation to the territories within which the cause of action, wholly or in-part, arises. This provision in the Constitution has come up for consideration in a number of cases before this Court. In this regard, it would suffice for us to refer to the observations of this Court in the case of Oil and Natural Gas Commission v. Utapl Kumar Basu and Ors. MANU/SC/0759/1994 : (1994) 4 SCC 711 wherein it was held :
"Under Article 226 a High Court can exercise the power to issue directions, orders or writs for the enforcement of any of the fundamental rights conferred by Part III of the Constitution or for any other purposes if the cause of action, wholly or in part, had arisen within the territories in relation to which it exercises jurisdiction, notwithstanding that the seat of the Government or authority or the residence of the person against whom the direction, order or writ it issued is not within the said territories. The expression "cause of action" means that bundle of facts which the petitioner must prove, if traversed, to entitle him to a judgment in his favour by the Court. Therefore, in determining the objection of lack of territorial jurisdiction the court must take all the facts pleaded in support of the cause of action into consideration albeit without embarking upon an enquiry as to the correctness or otherwise of the said facts. Thus the question of territorial jurisdiction must be decided on the facts pleaded in the petition the truth or otherwise of the averments made in the petition being immaterial."
30. In 2008 (1) SCC 618 (cited supra), the Hon'ble Supreme Court held as follows:
"30. We find considerable force in the submission of the learned counsel for the respondent Company. In our view, 'cause of action' and 'applicability of law' are two distinct, different and independent things and one cannot be confused with the other. The expression 'cause of action' has not been defined in the Code. It is, however, settled law that every suit presupposes the existence of a cause of action. If there is no cause of action, the plaint has to be rejected [Rule 11(a) of Order VII). Stated simply, 'cause of action' means a right to sue. It consists of material facts which are imperative for the plaintiff to allege and prove to succeed in the suit. The classic definition of the expression ('cause of action') is found in the observations of Lord Brett in Cooke v. Gill. His Lordship stated:
"Cause of action means every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the court".
37. The argument of the defendant that the agreement was executed in Hong Kong and hence suit could have been instituted only in that country is, in our opinion, not well founded. It is no doubt true that the suit could have been instituted in Hong Kong as well. That, however, does not take away the jurisdiction of Delhi Court where a part of cause of action has arisen. In the plaint, it was specifically alleged by the plaintiff Company that the defendant committed breach of terms and conditions of agreement during the Trade Fair in February, 2005 held in Pragati Maidan, Delhi. It was, therefore, open to the plaintiff Company to institute a suit in a competent Court within the jurisdiction of Delhi and that is how the suit is filed in the High Court on its Original Side.
39. It was submitted by the learned counsel for the appellant that once there is an agreement as to choice of Court or forum, the parties are bound by it. For the said proposition, our attention has been invited to several decisions rendered by this Court. We do not intend to burden our judgment on that point as the law is well settled and the learned counsel for the respondent Company has not disputed the proposition. What was contended was that Clause 18 does not take away the jurisdiction of a competent Court and the agreement did not exclude territorial jurisdiction of any Court.
46. Territorial jurisdiction of a Court, when the plaintiff intends to invoke jurisdiction of any Court in India, has to be ascertained on the basis of the principles laid down in the Code of Civil Procedure. Since a part of 'cause of action' has arisen within the local limits of Delhi as averred in the plaint by the plaintiff Company, the question has to be considered on the basis of such averment. Since it is alleged that the appellant- defendant had committed breach of agreement by using trade mark/trade name in Trade Fair, 2005 in Delhi, a part of cause of action has arisen in Delhi. The plaintiff Company, in the circumstances, could have filed a suit in Delhi. So far as applicability of law is concerned, obviously as and when the suit will come up for hearing, the Court will interpret the clause and take an appropriate decision in accordance with law. It has, however, nothing to do with the local limits of the jurisdiction of the Court."
31. If the above judgments are considered in the proper perspective, I am of the considered view that the facts of the present case would make it very clear that there arises a part of the cause of action in Chennai, within the jurisdiction of this Court, by the act of the defendant in approaching the IPA Board by filing a Revocation petition and therefore, the leave granted earlier cannot be revoked.
32. Now, let me consider the decisions relied on by the learned counsel for the defendant:
33. In 1983 (3) PTC 245 DEL (cited supra), the Delhi High Court held that an application can be filed either at a place whether the patent holder resides or carries on business or the place where the cause of action arises i.e., the place where the patent is registered or the place or places where the applicant has been sought to make liable for infringement of patent.
34. This decision relied on by the learned counsel for the defendant is not helpful to them as it was rendered in a different set of facts and even in this decision, the Delhi High Court clearly held that the application could be maintained where the cause of action arises. As observed by me, a part of the cause of action arose in this case in Chennai within the jurisdiction of this Court and therefore, this decision is not helpful to the case of the defendant.
35. In MANU/TN/3056/2007 (cited supra), a learned Judge of this court held that if there is nothing to show that sales have taken place within the jurisdiction of this Court, then, leave cannot be granted. This judgment is also clearly distinguishable on facts.
36. In MANU/DE/1198/2008 (cited supra), the Delhi High Court held that when there is no commercial sale within the territorial jurisdiction of a Court to constitute a part of the cause of action, investing such courts with jurisdiction is not proper. This decision also is not useful to the case of the defendant in the light of my observation that there arises a part of the cause of action in Chennai within the jurisdiction of this Court.
37. Considering the totality of facts and circumstances of the case, the leave granted by this Court cannot be revoked and hence, the application filed by the defendant in A.No.5529 of 2010 to revoke the leave granted by this Court in A.No.5166 of 2010 is dismissed. No cost.
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