Delhi High Court
Lg Corporation And Anr. vs Intermarket Electroplasters (P) Ltd. ... on 13 February, 2006
Author: A.K. Sikri
Bench: A.K. Sikri
JUDGMENT A.K. Sikri, J.
IA No. 258/06
1. Defendant No. 1 has moved this application under Order 7, Rule 11 of the Code of Civil Procedure (which is essentially an application under Order 7, Rule 10 CPC) read with Section 151 thereof for return/rejection of the plaint on the ground that this Court has no territorial jurisdiction to entertain the suit. In support, recent judgment of the Supreme Court in the case of Dhodha House v. S.K. Maingi is cited.
2. From the perusal of the plaint it is clear that the plaintiff has claimed that this Court has the jurisdiction:
(i) In view of the fact that the application for registration of the trade mark is filed in the Trade Mark Registry in Delhi and is advertised in Delhi;
(ii) In view of the provisions of Section 134 of the Trade Marks Act, 1999; and
(iii) In view of the fact that the defendant is selling the goods within the territorial jurisdiction of this Court.
3. It is conceded by learned Counsel for the plaintiff that in view of the Judgment of the Supreme Court in Dhodha House v. S.K. Maingi (supra), the plaintiff cannot claim the territorial jurisdiction of this Court on the basis of first two grounds. Therefore, it is the third ground only which needs to be considered and is pressed by the learned Counsel for the plaintiff and the submission is that this Court would have the territorial jurisdiction, once it is proved that the goods are sold in Delhi.
4. In para 30 of the plaint, the plaintiff has made specific averment that "the impugned goods of the defendants are also selling in Delhi, though without issuance of supporting invoices." Learned Counsel for the plaintiff has also referred to the documents filed by defendant No. 1 itself which include invoices dated 22nd March 2001 and 29th November 1999 as per which, the infringing goods have been sold to two parties in Delhi.
5. Learned Counsel for the defendants, on the other hands, submits that the defendant No. 1 is a company incorporated under the Indian Companies Act. Since it is not having any branch office or agent in Delhi, it cannot be said that it is carrying on any business or is working for gain in Delhi. In support of this reliance is placed on the judgment of the Supreme Court in the case of Kusum Ingots Alloys Ltd. v. Union of India . Submission made is that though that was a writ petition filed under Article 226 of the Constitution of India, the Supreme Court clearly opined that for interpretation of the phraseology used therein, regard shall be had to the provisions of Section 20(c) of the Code of Civil Procedure which shall apply to the writ proceedings as well. It is thus argued that ratio of that case shall be applicable while examining this question of territorial jurisdiction in a suit, as that case was decided on the principles contained in Section 20(c) of the Code of Civil Procedure which have direction application to suits.
6. Since it is not in dispute and there cannot be any dispute that for determination of the territorial jurisdiction of this Court provisions of Section 20 of the CPC are applicable, let me first examine the issue in the light of the said provision. Section 20 reads as under:
Section 20. Other suits to be instituted where defendants reside or cause of action arises. - Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction-
(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or
(b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution: or
(c) the cause of action, wholly or in part, arises.
[Explanation.] - A corporation shall be deemed to carry on business at its sole or principal office in India or, in respect of any cause of action arising at any place where it has also a subordinate office, at such place.
As per Clause (a), if the defendant actually and voluntarily resides or carries on business, or personally works for gain within the territorial jurisdiction of this Court, then this Court will have the jurisdiction. When the defendant is a company, ordinarily, the residence of a company would be where registered office is situated (Morgan Stanley Mutual Fund v. Kartick Das ). In so far as other two expressions contained in this clause, namely, "carries on business" and "personally works for gain" are concerned, these were explained in the judgment Dhodha House v. S.K. Maingi (supra) in the following manner:
A cause of action in a given case both under the 1957 Act as also under the 1958 Act may be overlapping to some extent. The territorial jurisdiction conferred upon the Court in terms of the provisions of the Code of Civil Procedure indisputably shall apply to a suit or proceeding under the 1957 Act as also the 1958 Act. Sub-section (2) of Section 62 of the 1957 Act provides for an additional Forum. Such additional Forum was provided so as to enable the author to file a suit who may not otherwise be in a position to file a suit at different places where his copyright was violated. The Parliament while enacting the Trade and Merchandise Marks Act in the year 1958 was aware of the provisions; of the 1957 Act. It still did not choose to make a similar provision therein. Such an omission may be held to be a conscious action on the part of the Parliament. The intention of the Parliament in not providing for an additional Forum in relation to the violation of the 1958 Act is, therefore, clear and explicit. The Parliament while enacting the Trade Marks Act, 1999 provided for such an additional Forum by enacting Sub-section (2) of Section 134 of the Trade Marks Act. The Court shall not, it is well well-settled, readily presume the existence of jurisdiction of a Court which was not conferred by the statute. For the purpose of attracting the jurisdiction of a Court in terms of Sub-section (2) of Section 62 of the 1957 Act, the conditions precedent specified therein must be fulfillled, the requisites wherefor are that the plaintiff must actually and voluntarily reside to carry on business or personally work for gain.
7. Therefore, there is no doubt that as the defendant No. 1 is not having any branch office or an agent in Delhi, it cannot be said that the defendant is carrying on business in Delhi. Up to this extent there is no quarrel. However, learned Counsel for the plaintiff has submitted that since infringing goods are sold in Delhi, part of cause of" action has arisen within the territorial jurisdiction of this Court. It may be stated that not only this averment s specifically made in the plaint, the plaintiff has also placed on record documents to show that sale of the infringing goods is taking place in Delhi. The question as to whether the Court has territorial jurisdiction to entertain a suit or not has to be arrived at on the basis of averments made in the plaint, that truth or otherwise thereof being immaterial as it cannot be gone into at this stage. Sale of the goods by defendant No. 1 in Delhi, which, according to the plaintiff, are the infringing goods and violate the trade mark of the plaintiff will give rise to the cause of action and, therefore, this Court will have the jurisdiction.
8. It has to be left to be determined in each individual case as to where cause of action arises. The jurisdiction is conferred upon a Court even when part of cause of action arises. Present suit is filed on the ground that the defendant is passing off its goods as that of the plaintiff and for this purpose the goods are being sold in Delhi also. It is the sale of goods in Delhi by the defendant which has given cause to the plaintiff to enforce the legal remedy for redress. Fact of the sale of infringing goods in Delhi has the nexus and relevance with the lis that is involved in the case. It has, in fact, a direct bearing with the Us or the dispute on the basis of which grievance is raised by the plaintiff. It is this sale which has given the plaintiff right to use.
9. Learned Counsel for the defendant relied upon para 20 of the judgment of the Supreme Court in Kusum Ingots Alloys Ltd. v. Union of India (supra) to contend that it was discretionary jurisdiction of this Court and this Court could still refuse to exercise the jurisdiction. In order to appreciate this contention of the learned Counsel for the defendant, we may first take note of para 30 of the said judgment which makes the following reading:
30. We must, however, remind ourselves that even if a small part of cause of action raises within the territorial jurisdiction of the High Court, the same by itself may not be considered to be a determinative factor compelling the High Court to decide the matter on merit. In appropriate cases, the Court may refuse to exercise its discretionary jurisdiction by invoking the doctrine of Forum convenience. (See Bhagar Singh Bagga v. Dewan Jasbir Sawhany ; Mandal Jalan v. Madanlal (1945) 49 CWN 357; Bharat Coking Coal Limited v. Jharia Talkies and Cold Storage Pvt. Ltd. (1997) CWN 122; S.S. Jain and Co. and Anr. v. Union of India and Ors. (1994) CHN 445; New Horizon Ltd. v. Union of India ).
10. The principle laid down by the Supreme Court in the aforesaid case to the effect that in appropriate cases the High Court may refuse to exercise discretionary jurisdiction by invoking the doctrine of Forum convenience has no applicability in suit. However, those observations are clearly in the context of Article 226 of the Constitution as the Court exercises extraordinary jurisdiction in writ petitions and it is trite law that the jurisdiction under Article 226 is discretionary. That would not be a position when a suit is filed, as in the instant case, and if it is established that even a part of cause of action has arisen, there is no question of then refusing to exercise the jurisdiction. I may state that though counsel for the plaintiff conceded that the filing of application for registration of the trade mark in the Trade Mark Registry, Delhi would not give jurisdiction to this Court. In a recent judgment of this Court, (per Hon'ble Mr. Justice Badar Durrez Ahmed in IA No. 1347/2006 in CS (OS) No. 311/2005- Pfizer Products, Inc. v. Rajesh Chopra and Ors., decided on 8th February 2006) after discussing the judgment in the case of Dhodha House v. S.K. Maingi (supra) the Hon'ble Judge has opined that the application for registration in the Trade Mark Registry in Delhi would also confer jurisdiction in this Court. This application is, therefore, rejected.
CS (OS) No. 1359/2004List before the Joint Registrar for admission/denial of documents on 17th April 2006 and before the Court for framing of issues as well as arguments in IA No. 8009/2004 on 6th July 2006.
IA No. 8010/2004No further orders are required to be passed on this application, which is accordingly disposed of.