Delhi High Court
Pfizer Enterprises Sarl vs Cipta Ltd. on 24 October, 2008
Author: Vikramajit Sen
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ FAO(OS)356/2008 & CM No.11752/2008
# PFIZER ENTERPRISES SARL ....Appellant through
! Mr. Saikrishan Rajgopal with
Mr. Sidharth Chopra and
Mr. Saurabh Srivastava,
Advs.
-versus-
$ CIPLA LTD. ...Respondent through
^ Mr. Ajay Sahni with
Ms. Vrinda Bajaj, Advs.
WITH
FAO(OS)428/2008 & CM No.14785/2008
P.M. DIESELS LTD. ....Appellant through
Mr. Valmiki Mehta, Sr. Adv.
with Mr. R.K. Aggarwal,
Mr. Natwar Rai & Mr. Amit
Gaurav Singh, Advs.
-versus-
PATEL FIELD MARSHAL INDUSTRIES...Respondent
through
Mr. Shailen Bhatia with
Ms. Ekta Nayal Saini, Advs.
% Date of Decision : October 24, 2008
CORAM:
* HON‟BLE MR. JUSTICE VIKRAMAJIT SEN
HON‟BLE MR. JUSTICE S.L. BHAYANA
1. Whether reporters of local papers may
be allowed to see the Judgment? Yes
2. To be referred to the Reporter or not? Yes
3. Whether the Judgment should be
reported in the Digest? Yes
FAO(OS)356/2008 Page 1 of 20
VIKRAMAJIT SEN, J.
JUDGMENT
1. In the Pfizer Appeal the Plaintiffs have assailed the Order
dated 16.7.2008 of the learned Single Judge holding that the
High Court of Delhi lacks territorial jurisdiction. The impugned
Order returns the Plaint for filing in the appropriate court. The
dispute centres upon the averments made in the Plaint and the
response thereto contained in the Written Statement.
2. P.M. Diesels litigation has remarkable annals. For the
present purposes the relevant pleadings are found in paragraph
30 of the Plaint wherein it has, inter alia, been asserted that
"the goods of the parties bearing the impugned trade marks are
also sold in the Union Territory of Delhi". The interim injunction
had been declined on 10.3.1998 principally for the reason that
the Plaintiff/Appellant had failed to establish the territorial
jurisdiction of the courts in Delhi. In the Appeal the Division
Bench set aside the Order and the lis was carried further to the
Supreme Court. Their Lordships noted that one of the three
contentions raised was that the Defendants were selling the
offending goods in Delhi, and that the Delhi High Court did not
advert to it. Indeed, the Supreme Court remanded the matter to
the Delhi High Court for it to answer this aspect of the dispute
opining that questions of fact "required to be properly
determined in case evidence is led by the parties". Eventually,
the Defendant filed the application under Order VII Rule 11 of
the Code of Civil Procedure, 1908 (CPC for short) for dismissal
of the Suit which was allowed but after treating it under Order
VII Rule 10 (return of the Plaint). It is this Order dated
20.8.2008 which has been assailed before us.
3. The respective pleadings in the Pfizer Enterprises action
relevant for the present purposes are produced in juxtaposition:-
Plaint Written Statement
17. This Hon‟ble 17. That the contents of para 17 of the
Court has plaint are wrong and emphatically denied
necessary and the plaintiffs are put to strict proof of
jurisdiction to their said averments. It is submitted that
entertain and try this Hon‟ble Court has no territorial
the present Suit, jurisdiction to entertain and try the present
by virtue of suit in as much as none of the plaintiffs are
Section 134(1) of the „registered proprietor‟ of the
the Trade Marks aforementioned trade marks in terms of
Act, 1999 as the Section 2(1)(v) of the Trade Marks Act,
Plaintiffs‟ products 1999 and the present suit for an alleged
including infringement is liable to be dismissed on
DALACIN C, are this account alone. Even an alleged action
available for sale of passing off is not maintainable in as
& distribution much as the trade marks, get-up,
within the placement, design, prices, packaging, etc.
jurisdiction of this of the two competing products is
Hon‟ble Court. completely different and one can by no
Further, the stretch of imagination be confused/passed
Defendants‟ off as the other particularly in view of the
products under fact that both the medicines are scheduled
the impugned drugs and there is neither any possibility
mark are available nor even any remote probability of one
for sale in Delhi being mistaken for the other. From the
and therefore, the array of parties as disclosed in the plaint it
cause of action is clear that the both the plaintiff and the
has also arisen defendant carry on their business in
within the Mumbai and therefore this Hon‟ble Court
jurisdiction of this would have no territorial jurisdiction to
Hon‟ble Court. entertain and try the present suit. Reply to
the preceding paragraph may be read as a
reply to this paragraph also.
4. It would be of advantage to recall Order VI Rule 2 of the
CPC which mandates that the evidence by which the material
facts are to be proved ought not to be pleaded. Rule 4
prescribes that in all cases in which the party pleading relies on
any misrepresentation, fraud, breach of trust, wilful default, or
undue influence, and in all other cases in which particulars may
be necessary beyond such as are exemplified in the forms
contained in Appendix-I, particulars shall be stated in the
pleading. Order VII Rule 1 of the CPC spells out the particulars
that should be contained in the Plaint and inter alia requires
that facts showing that the Court has jurisdiction must be
contained therein. Rule 10 contemplates the return of the Plaint
at any stage of the suit if the Court is of the opinion that it
should be presented in some other Court.
5. Order VIII of the CPC places substantially similar
obligations on the Defendant. Rule 2 thereof specifically states
that the Defendant must raise by his pleadings all matters which
show the suit not to be maintainable. It further requires to be
pleaded all grounds of defence as, if not raised, would be likely
to take the plaintiff by surprise, or would raise issues of fact not
arising out of the Plaint. Rule 3 clarifies that it would not be
sufficient for a Defendant in his Written Statement to deny
generally the grounds alleged by the Plaintiff; the Defendant
must deal specifically with each allegation of fact and of which
he does not admit the truth. Rule 4 prescribes that where a
Defendant denies an allegation of fact in the Plaint, he must not
do so evasively, but must answer the point of substance. An
illustration is contained in the Rule itself which is poignant to
the point before us. It is that if it is alleged by the Plaintiff that
the Defendant had received a certain sum of money, it shall not
be sufficient for the Defendant to deny that he received that
particular amount, but the Defendant must deny that he
received that sum or any part thereof, or else set out how much
he received. The Defendant must categorically refute the
averments in the Plaint on the strength of which territorial
jurisdiction is claimed. Rule 5 further goes on to state that every
allegation of fact in the Plaint, if not denied specifically or by
necessary implication, or stated to be not admitted in the
pleading of the Defendant, shall be taken to be admitted.
Indeed, the CPC takes pains to stipulate that the assertions in
the Plaint must be categorical and unambiguously answered. If
the Defendant fails to effectively respond to the pleadings in the
Plaint and instead sets out extraneous reasons why the Court
does not possess jurisdiction, the non traversed pleadings will
be deemed to be correct.
6. By an amendment introduced with effect from 1.7.2002
Rule 14 of Order VII requires, where a plaintiff sues upon a
document or relies upon document in his possession or power in
support of his claim, that he shall enter such documents in a list,
and shall produce it in Court when the Plaint is presented by
him and shall, at the same time deliver the document and copies
thereof, to be filed with the Plaint. Order XXXIX of the CPC
makes the existence of documents critical at the pre-trial stages
of the suit, inasmuch as it mandates service of documents on
which the Plaintiff relies on the opposite party. That, however,
will be relevant to the aspect of whether the applicant has
succeeded in making out a case for the issuance of an
injunction, ex parte or after hearing the adversaries.
7. Returning to the pleadings in the case in hand, it is
worthwhile to underscore that the Plaint states that „DALACIN
C‟ is "available for sale and distribution within the jurisdiction of
this Court. Further, the Defendant‟s products under the
impugned mark are available for sale in Delhi". In response to
these categorical pleadings, no doubt the Defendant has
commenced his response by generally stating that contents of
the corresponding paragraph of the Plaint are wrong and
emphatically denied, and that this Court has no territorial
jurisdiction to entertain and to try the Suit. However, this
objection has been predicated on three grounds - firstly that
none of the Plaintiffs are the registered proprietors of the trade
mark; secondly that the claim of passing off is not maintainable
since the trademark, getup, placement etc. are completely
different and both the medicines are scheduled drugs and there
is no possibility of a customer being mistaken; lastly and most
importantly that both the Plaintiffs and the Defendant carry on
business in Mumbai and, therefore, Courts in Delhi have no
territorial jurisdiction. There is not even a whisper with regard
to the Plaintiff‟s assertion that „DALACIN C‟ is available for sale
and distribution in Delhi and that the Defendant‟s offending
products are also available for sale in Delhi. As has been
graphically stated by the Apex Court, the cause of action
constitutes a bundle of facts any of which, and not collectively
all of which, may constitute the cause of action necessary for
filing of a lis in a particular Court.
8. In Trade Connection -vs- International Building
Products(P) Ltd., 2002 III AD (Delhi) 344, a learned Single Judge
of this Court had transformed a failure to reply to paragraphs in
the Plaint into unequivocal admissions of fact. In H.S.E.B. -vs-
Ram Nath, (2004) 5 SCC 793 their Lordships noted that there
was no denial to the categoric averments to the effect that
electrical wires were loose and were drooping and touching the
roof of houses and, therefore, a deemed admission must be
drawn against the Defendant. In Ram Singh -vs- Col. Ram
Singh, 1985 (Supp.) SCC 611 the Supreme Court again applied
Order VIII Rule 5 of the CPC in concluding that the Respondent
must be deemed to have admitted that two persons named in
the Petition were the relatives of the Respondent because of his
failure to specifically deny this assertion. Badat and Co. -vs-
East India Trading Co., AIR 1964 SC 538 is extremely
important. After briefly considering the provisions of Orders VII
and VIII of the CPC and specifically Rules 3 to 5 thereof, it was
observed as follows -"These three Rules form an integrated code
dealing with the manner in which allegations of fact in the plaint
should be traversed and the legal consequences flowing from its
non-compliance. The written statement must deal specifically
with each allegation of fact in the plaint and when a defendant
denies any such fact, he must not do so evasively but answer the
point of substance. If his denial of a fact is not specific but
evasive, the said fact shall be taken to be admitted. In such an
event, the admission itself being proof, no other proof is
necessary." Without adverting to Badat and Co. a Three-Judge
Bench in Biswanath Prasad -vs- Dwarka Prasad, AIR 1974 SC
117 opined that an admission by a party is substantive evidence
in respect of which it is not a necessary requirement that the
statement containing the admission would not be put to the
concerned party because it is evidence pro prio vigore. In
Nagindas Ramdas -vs- Dalpatram Iccharam, AIR 1974 SC 471 a
Coordinate Bench had observed that - "admissions in pleadings
or judicial admissions admissible under Section 58 of the
Evidence Act made by the parties or their agents at or before
the hearing of the case, stand on a higher footing than
evidentiary admissions. The former class of admissions are fully
binding on the party that makes them and constitute a waiver of
proof. They by themselves can be made the foundation of the
rights of the parties. On the other hand evidentiary admissions
which are receivable at the trial as evidence are by themselves
not conclusive. They can be shown to be wrong".
9. The significance attached to an admission in pleadings is
also evident from the string of precedents dealing with the
amendments of pleadings calculated to withdraw or nullify or
dilute an admission. Justice Yogeshwar Dayal, his Lordship as
then was, held in Neera Graver -vs- Narinder Jaggi, 21 (1982)
DLT 33 that since the tenant had not denied the specific
averment in the eviction petition to the effect that the premises
were for residential purposes, this position must be treated to
have been admitted by the tenant. An admission to plead, by
way of an amendment, that the premises were let out for both
residential and commercial purposes, was rejected as it would
tantamount to withdrawing an admission already made. To the
same effect the Supreme Court had in Sangramsinh P. Gaekwad
-vs- Shantadevi P. Gaekwad, AIR 2005 SC 809 held that an
admission made by the petitioner in a petition under Sections
397/398 could not be permitted to be withdrawn through the
device of an amendment. After analysing the above-mentioned
case, their Lordships opined in paragraph 29 that "judicial
admissions by themselves can be made the foundations of the
rights of the parties".
10. In this analysis, there is no alternative but to conclude
that the Defendant Cipla Ltd. must be deemed to have admitted
that the Plaintiffs‟ products, including "DALACIN C" are
available for sale and distribution in Delhi and furthermore that
the Defendant‟s products under the impugned mark are also
available for sale in Delhi. As categorically pleaded in the Plaint
itself, the cause of action has, therefore, undeniably arisen in
Delhi. Documents become unnecessary. Even in the absence of
an admission facts can be proved by means of Parol and/or
documentary evidence. The Division Bench in Intas
Pharmaceuticals Ltd. -vs- Allergan Inc., AIR 2007 Delhi 108
opined that Section 134 of the Trade Marks Act does not
override Section 20 of the CPC; rather it provides an additional
forum and place for filing the suit. Keeping in view the fact that
Defendant in that case had been selling the offending products
in Delhi, the Division Bench upheld the view of the learned
Single Judge holding that courts in Delhi possessed territorial
jurisdiction to entertain the suit. The Division Bench analysed
and applied Dhodha House -vs- S.K. Maingi, (2006) 9 SCC 41
and thereupon concludes firstly that since the Plaintiff had
pleaded in the plaint that the Defendant was selling the
offending product in Delhi, Delhi Courts possessed territorial
jurisdiction; secondly that Section 20(c) of the CPC makes
available, in addition to Section 134 of the Trade Marks Act,
another forum of adjudication. We are in entire agreement with
the views expressed by our Coordinate Bench. These apply on
all fours to the case in hand since the Defendant Cipla Ltd.
before us must be deemed to have admitted that the Plaintiffs‟
products are available for sale in Delhi and that their products
are also available for sale in Delhi. No further evidence, oral or
documentary, has to be produced by the Plaintiff to substantiate
these facts.
11. The exposition of law to be found in Exphar SA -vs-
Eupharma Laboratories Ltd., 2004 (28) PTC 251(SC) is apposite.
Even if a deemed admission is not drawn against the Defendant,
the averments made in the Plaint must, in interlocutory
proceedings, be treated as true. The Supreme Court has
observed that when an objection to jurisdiction is raised by way
of demurrer and not at the trial, the objection must proceed on
the basis that the facts as pleaded by the initiator of the
impugned proceedings are true. The submission in order to
succeed must show that granted those facts the Court does not
have jurisdiction as a matter of law. Unlike the case in hand,
the Defendant before the Supreme Court had denied the
assertion that the Plaintiffs goods were not sold in Delhi. A
fortiori, when relevant pleadings are not denied, the Court
would be falling in error in not accepting as correct the factual
version expressed in the Plaint. A similar enunciation of the law
is to be found in Laxman Prasad -vs- Prodigy Electronics Ltd.,
2008 (37)PTC 209 (SC) : (2008) 1 SCC 618. A reading of
Laxman Prasad will unquestionably disclose that the Intas
opinion now has the imprimatur of the Supreme Court. Learned
counsel for the Appellants has elaborately quoted from Dhodha
House but in our view this case does not help the resolution of
the conundrum before us.
12. The Preliminary Question which arose in Dhodha House
was whether the existence of jurisdiction under Copyright Act,
1957 would also enable the clubbing of the dispute arising from
the Trade and Merchandise Act, 1958. The Supreme Court
explained that existence of territorial jurisdiction by virtue of
one Act would not clothe that very Court with a determination of
a dispute under another Act only because of the provisions of
Order II of the CPC (The parties in the P.M. Diesel were also
one of the Appellants in the Dhodha House matter). Secondly,
it had been observed that this Court had not adverted to the
third contention that had arisen in the matter, viz. whether the
Defendant had been selling its products on a commercial scale
in Delhi. We think it necessary to at once clarify that in P.M.
Diesel averments made in the Plaint have not been admitted in
the Written Statement as is the case in the Pfizer Appeal. Our
attention has also been drawn to the observations made by their
Lordships in Dabur India -vs- K.R. Industries, 2008 (37) PTC
332(SC) where it was reiterated that since the primary ground
upon which jurisdiction of the Delhi High Court had been
invoked was violation of the Trade and Merchandise Marks Act,
1958 the provisions of Section 62(2) of the Copyright Act, 1957
could not be invoked. This was also the ratio of Dhodha House.
It was also observed that the Plaintiff in Dhodha House was
not a resident of Delhi; that he had not been able to establish
that it carried on any business at Delhi; for this purpose the
question as to whether the Defendant had been selling its
produce in Delhi or not was wholly irrelevant. The last of the
three observations clarifies the position pertaining to the place
where the Plaintiff transacts business. Section 134(2) of the
Trade Marks Act, 1999 enables the Plaintiff to institute any suit
or proceedings in the District Court having jurisdiction over the
territories where it "actually and voluntarily resides or carries
business or personally works for gain". This is also what is
postulated by Section 62(2) of the Copyright Act, 1957. It was
for this reason that their Lordships clarified that it was wholly
irrelevant whether the Defendant was selling its products in the
place where the suit had been filed. However, if the territorial
jurisdiction is invoked by the Plaintiff on the ground of the cause
of action having arisen in the form of sale of offending goods
within the territories of that Court, the question of Defendant‟s
activity would become relevant and the Plaintiffs activity would
become irrelevant. If the Plaint discloses that the Defendant
has violated the Plaintiff‟s Trademark or Copyright in a
particular place, the cause of action would arise therein and the
observations in Laxman Prasad would clothe that Court with
jurisdiction.
13. We approve the approach adopted in Pfizer Products Inc. -
vs- Rajesh Chopra, 2006 (32) PTC 301 and in Boston Scientific
International B.V. -vs- Metro Hospital, 2007 (136) DLT 278.
14. We are unable to appreciate the argument of learned
Counsel for the Defendant which found favour before the
learned Single Judge that Liverpool & London S.P. & I
Association Ltd. -vs- M.V. Sea Success I, (2004) 9 SCC 512
supports the Defendant‟s case. Their Lordships had succinctly
and perspicuously covered the conundrum before us in these
words:-
Rejection of plaint
139.Whether a plaint discloses a cause of action or not
is essentially a question of fact. But whether it does or
does not must be found out from reading the plaint
itself. For the said purpose the averments made in the
plaint in their entirety must be held to be correct. The
test is as to whether if the averments made in the
plaint are taken to be correct in their entirety, a decree
would be passed.
Dealing with the merits of the case their Lordships noted that so
far as the existence of a cause of action was concerned the
documents filed along with the pleadings should be looked into.
This was in addition to the pleadings, in order to explain or
support them. Their Lordships did not enunciate that documents
are necessary even if facts stand admitted. This is an altogether
different situation from the "return" of the Plaint, which is
onerous only to the extent that the same Plaint has to be filed in
the Court which is competent to entertain it. So far as the
rejection of a Plaint is concerned, it is tantamount to a dismissal
of the Plaint and, therefore, the CPC justifiably enumerates the
circumstances in which such an order can be passed. It is trite
that if a cause of action has not arisen, a suit has to be
dismissed. Secondly, if the proper Court Fee has not been paid,
and despite the opportunity the Plaintiff remains recalcitrant in
making up the deficiency, there is every justification for
dismissing the suit. Furthermore, if on a plain reading of the
Plaint itself its entertainment appears to be barred by any law, it
would be reasonable for it to be dismissed. Because of these
implications, there is every reason that a Judge must be fully
satisfied before passing an order which would have serious
repercussions; therefore, it would be in the fitness of things for
the Court to also look at documents which are available on the
records before passing an order which virtually dismisses the
suit, the only saving being that a fresh suit is not barred.
15. We have already noted the provisions of the CPC which
enable documents to be filed at different stages of an
adjudication of the plaint. Let us take the case of a plaint which
merely asseverates certain facts and does not substantiate it by
filing documents which may be available. In case the Plaintiff is
desirous of obtaining interim relief, it would be reasonable for
the Court not to act only on the pleadings. When the Court is
called upon to decide an application under Order XXXIX
documents become relevant and, therefore, they are required to
be served on the opposite party for fear that on failure the
interim order would stand recalled. However, if an ex parte
order is not passed and a statement made in the plaint is
admitted in the Written Statement, documents or oral evidence
would become superfluous. At no point had their Lordships
indicated that if documents have not been filed substantiating
the averments made in a Plaint, the suit is liable to be
dismissed. Myriad problems will arise if documents are to be
looked at for the purposes of rejection of a plaint. At what stage
of the proceedings must this exercise be carried out? Certainly,
it is not possible to rely or take note of documents which are yet
to be proved. Therefore, apart from very unlikely event where a
document stands admitted by the Defendant at the earliest
stages of the litigation, it would be of little or no use to act upon
them. However, if the Court is of the view that the suit is
vexatious or has palpably been filed in a Court which does not
possess jurisdiction, it is fully empowered to proceed under
Order X of the CPC. Rule 1 thereof enables the Court to
ascertain from the either parties before it whether it admits
allegations of fact made in the Plaint or the Written Statement.
Rule 2 thereof also postulates the Court examining any party to
the lis with a view to elucidating matters in controversy in the
suit or in answer to any material question relating to the suit.
Obviously, this course could also be adopted by Courts to decide
an issue which requires evidence to be adduced. Of course, the
Court will take recourse to this provision only if it has, of its
own, come to the conclusion that the litigation is an abuse of the
process of Court. Otherwise, the provisions of Order XIV Rule 2
enjoin that Issues both of law and of fact would be decided at
the end of suit. The said Rule envisages that if an Issue relating
to the jurisdiction of the Court is an Issue of law only, in
contradistinction to an Issue both of law and of fact, it may try
such an Issue first. Seen from all perspectives, therefore, it
would be in very rare cases (such as an admission of fact by the
adversary) that a plaint can be returned or rejected, as the case
may be. Otherwise, as applies to both the Plaint and the
Written Statement, the pleadings at the initial stages must be
approached as if they are correct either for rejecting the plaint
or decreeing the suit. This is what Liverpool holds as it
reiterates the established position that pleadings at the initial
stages must be taken as a true and correct narration of events.
16. For the manifold reasons mentioned above, FAO(OS)
356/2008 is accepted. Since the Defendant has not specifically
traversed the pleadings pertaining to the territorial jurisdiction
of this Court, the position is that the Plaintiffs would not be
required to lead any evidence on this aspect of the case. That
being so, it is beyond cavil that the Plaint ought not to have
been returned. The distinction between the return of a Plaint to
facilitate its filing in a Court possessing territorial jurisdiction
and the rejection of a Plaint on the ground that a cause of action
has not been made out, is extremely poignant and important.
17. So far as FAO(OS) 428/2008 (P.M. Diesels) is concerned,
the position is very clear, as their Lordships have remanded the
matter to this Court to decide the third contention raised
therein, namely, whether the Defendant was selling the
offending goods in Delhi, which could be decided only after
evidence has been brought on record. Additional to this
undebatable position, since P.M. Diesels had pleaded that the
Defendant was selling offending goods in Delhi, the Court had
perforce to proceed at the present stage of the lis on the
assumption that the averment to this effect was verily true.
Therefore, the Plaint could not have been returned. This Appeal
is also allowed. However, we take note of the statement pleaded
in the Appeal to the effect that before the Learned Single Judge,
the learned Senior Advocate for the Plaintiff/Appellant had
"offered that he had no objection if the present suit along with
the pending applications and the injunction granted by this
Hon‟ble Court, is transferred to the Court at Rajkot and
proceedings start at Rajkot from the stage as at present before
this Hon‟ble Court" (paragraph 22). In view of the submission
we return the Plaint along with all the other pleadings to the
Plaintiff for filing in the Courts in Rajkot. Certified copies of the
entire Paper-Book be retained and dispatched to Record Room.
18. We set aside the impugned Order but there shall be no
order as to costs.
( VIKRAMAJIT SEN )
JUDGE
October 24, 2008 ( S. L. BHAYANA )
tp JUDGE
