Punjab Tractors Limited vs M/S International Tractors Ltd & ...
2009 Latest Caselaw 3846 Del

     *IN THE HIGH COURT OF DELHI AT NEW DELHI

+           IA No.1764/2002 in CS(OS) No.470/2004
                          (Instituted in 1999)

%                                  Date of decision:18.09.2009

PUNJAB TRACTORS LIMITED                                     ....Plaintiff
                         Through: Mr. Mr. Rajiv Nayar, Sr. Advocate with
                                  Mr. M.G. Ramachandra & Mr. Atishi
                                  Dipankar, Advocates for the plaintiff in
                                  suit No.470/04 & for defendant in suit
                                  No.301/03.

                                  Versus

M/S INTERNATIONAL TRACTORS LTD & ORS.... Defendants

                         Through: Mr. Dhruv Mehta, Mr. Sai Krishan Raja
                                  Gopal, Mr. Sagar, Advocate & Mr.
                                  Yashraj Singh, Deora, Advocates.


CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

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               YES
      in the Digest?


RAJIV SAHAI ENDLAW, J.

1. Application of the defendants under Section 340 of the Cr.PC

for proceeding against Mr. R.K. Manrao & Mr. G.S. Rihal of the

plaintiff is for consideration.

2. The plaintiff instituted this suit on the pleas:-

a. That it is engaged in the business of manufacture and

sale of agricultural tractors etc.;

b. Tractors manufactured by plaintiff are based on

technology and knowhow developed originally be Central

Mechanical Engineering Research Institute (CMERI)

under the Council for Scientific & Industrial Research

(CISR);

c. In terms of the arrangement between CMERI and the

Govt. of India, the patent design, copyright and all other

intellectual property rights in the tractor developed by

CMERI came to be vested in the National Research &

Development Corporation of India (NRDCI);

d. That NRDCI granted to Punjab State Industrial

Development Corporation Ltd. (PSIDCL) licenses to use

the aforesaid technology developed by CMERI including

the patent rights which CMERI possesses with respect

thereto and a license dated 31st July, 1972 was executed;

e. That PSIDCL assigned its rights under the aforesaid

license deed to the plaintiff and the plaintiff came to be

authorized to manufacture and sell tractors in

accordance with the knowhow technology etc. developed

by CMERI and vested with NRDCI;

f. That the plaintiff company commenced commercial

production of tractors in April, 1974;

g. That the plaintiff continued research on the tractor

models, affecting the modifications and changes required

from time to time for improved performance of the

tractors with Mr. G.S. Rihal & Mr. Manrao of the plaintiff

being Incharge of the Research & Development

Functions since 1991;

h. That the plaintiff company has a copyright in the

drawings prepared by it of various components of the

tractor;

i. That the defendants are also engaged in the business of

manufacture and sale of tractors; in September, 1996 the

plaintiff learnt of the attempts of the defendants to take

advantage of the specifications and tools of the tractors

developed by the plaintiff by getting approval from

Central Firm Machinery Training & Testing Institute

(CFMTTI); that the defendants have been copying the

drawings and specifications of components, parts,

assemblies of the tractors developed and prepared by the

plaintiff and manufacturing tractors therefrom;

j. That the plaintiff as Annexure A-1 to A-11 to the plaint

filed drawings developed by and belonging to the

plaintiff in relation to the tractors components;

k. That the plaintiff as Annexure B-1 to B-10 to the plaint

filed the drawings of the same components used by the

defendants and given by the defendants to their vendors

for procurement of components and parts;

l. It is the case of the plaintiff that a comparison of the two

sets aforesaid of the drawings will show the systematic

copying by the defendants of the plaintiff's drawings;

m. The plaintiff thus sought the relief, inter-alia of

restraining the defendants from infringing the copyright

vesting in the drawings of the plaintiff relating to

manufacture of tractors and components and parts of the

tractors as described in Annexure A-1 to A-11 or

otherwise;

3. The defendants contested the suit, inter-alia on the ground that

the drawings Annexure A-1 to A-11 to the plaint in which the plaintiff

claimed copyright were in fact the drawing authored by CMERI and

with respect whereto the plaintiff had no right to maintain the

action. Per contra, the contention of the plaintiff was that though it

had initially commenced manufacture on the basis of the drawings in

which CMERI had a right, the plaintiff had over the years made its

own innovation, improvement, research and the drawings Annexure

A-1 to A-11 were of the plaintiff and not of CMERI. The plaintiff as

Annexures C-1 to C-8 to the replication filed the drawings which the

plaintiff claimed were of the CMERI. According to plaintiff,

drawings B-1 to B-10 were similar not to drawings C-1 to C-8 but to

drawings A-1 to A-11.

4. The plaintiff along with the suit also filed an application for

interim relief. The plaintiff in support of its claim for interim relief

filed affidavit dated 24th January, 2001 of its Mr. R.K. Manrao. To

meet the defence aforesaid of the defendants and with the objective

of comparing Annexure A-1 to A-11 with the drawings developed by

CMERI in 1970, the plaintiff along with the affidavit of Mr. Manrao

filed further drawings demonstrating the differences in the drawings

of CMERI and in Annexure A-1 to A-11.

5. The defendants in response to the affidavit dated 24th January,

2001 filed the drawings of CMERI of the year 1982 to contend that

most of the improvements which the plaintiff was claiming to be its

own or of which the plaintiff was claiming to be the author were in

fact as per the drawings of the year 1982 of CMERI. The plaintiff

then filed the affidavit of September, 2001 of its Mr. G.S. Rihal to

demonstrate the differences between CMERI's drawings of the year

1982 and Annexure A-1 to A-11 to the plaint.

6. It is the contention of the defendants that the said Mr. Manrao

and Mr. Rihal have committed perjury in stating in their affidavits

aforesaid the differences between the drawings of CMERI and of the

plaintiff. It is further the contention of the defendants in the

application under consideration that the plaintiff has with a view to

show the said differences deliberately manipulated and altered and

tempered with the drawings filed with the affidavit, of plaintiff itself,

of CMERI as well as of the defendants. It is further the case of the

defendants that the drawings provided with the affidavit of Mr.

Manrao as of the plaintiff are different from the drawings Annexure

A-1 to A-11 filed with the plaint. The application under consideration

lists the manipulations allegedly carried out of the plaintiff in the

drawings.

7. Though the application was filed in the year 2002, the same

appears not to have been pressed and remained on the file. It was

only on 11th January, 2007 that the counsel for the defendants

pressed for notice thereof to be issued. However, since the counsel

for the plaintiff wanted to oppose even the issuance of notice, the

matter was adjourned to 19th March, 2007. By that time, the cross

examination of Mr. G.S. Rihal who has also filed his affidavit by way

of evidence on behalf of the plaintiff was already underway.

However, the order sheet reveals that even on 19th March, 2007 or at

any time thereafter notice of this application was not issued. The

defendants filed IA No.10593/2008 in this regard and which came up

before this court on 2nd September, 2008. The counsel for the

defendants contended that for the purposes of the said application

the defendants do not need to lead any evidence and were willing to

argue on the ingredient of Section 340 of the Cr.PC being satisfied

on the basis of the material on record only. However, since the trial

was still underway at that stage it was put to the counsel for the

defendants that they would be pressing the application at this stage

on their own peril and the application would be dismissed and

hearing of the application would not be deferred if the court was not

satisfied of maintainability of application at this stage. The counsel

for the defendants consented to the same and accordingly it was

ordered that this application be listed for consideration after the

conclusion of the plaintiff's evidence and before recording of the

cross examination of the witnesses of the defendants. Though as

aforesaid even the notice to the application has not been issued but

the plaintiff has in opposition thereto filed a reply dated 26th April,

2008 thereto and a rejoinder dated 23 rd August, 2008 has also been

filed.

8. The counsels have been heard on the application.

9. The counsel for the defendants/applicants have besides making

submissions on the differences in the drawings aforesaid also drawn

attention to the cross examination of Mr. G.S. Rihal recorded on 13th

February, 2008 and on 14th February, 2008 as well as the affidavit by

way of evidence filed in the year 2006 of the said Mr. G.S. Rihal. Mr.

G.S. Rihal has therein affirmed as correct the analysis of comparison

of drawings by Mr. Manrao in his affidavit dated 24th January, 2001.

However, Mr. G.S. Rihal has in his cross examination admitted

certain differences in the drawings filed as Annexure A-1 to A-11 to

the plaint and in the drawings filed as Annexure to the said affidavit

of Mr. Manrao to demonstrate the differences between the drawings

of the plaintiff and that of CMERI. Mr. Manrao has of course given

the explanation for the said differences but the contention of the

counsel for the defendants/applicants is that from the said cross

examination, the fabrication of drawings by Mr. Manrao and

affirmation thereof by Mr. G.S. Rihal stands admitted.

10. Mr. G.S. Rihal has in his cross examination deposed that the

filing of one of the drawings as Annexure to the affidavit of Mr.

Manrao was an error but denied that the same was deliberate and

has further claimed to have discovered the said error only during his

cross examination. Mr. G.S. Rihal in his cross examination on 14th

February, 2008 admitted similar error with respect to another

drawing also.

11. The counsel for the defendants relied on K. Karunakaran Vs.

T.V. Eachara Warrier (1978) 1 SCC 18 to canvass that any enquiry

to be held by the court under Section 340 of the Cr.PC is only to the

extent whether a prima-facie case is made out, which if urebutted

may have a reasonable likelihood to establish the specified offence

and whether it is also expedient in the interest of justice to take such

action. Reliance was also placed on Mahila Vinod Kumari Vs.

State of Madhya Pradesh (2008) 8 SCC 34 on the evils of perjury

assuming alarming proportion. On inquiry as to offence under which

of the provisions of IPC was claimed to have been committed,

reliance was placed on In Re: Suo Moto Proceedings against R.

Karuppan (2001) 5 SCC 289 laying down that justice dispensation

system would be wrecked if statutory restrictions are not imposed

upon the litigants who attempt to mislead the court by filing and

relying upon false evidence. In answer to another query as to what

advantage had been derived by the plaintiff by allegedly fabricating

the drawings, in as much as no interim relief had been granted to the

plaintiff, reliance was placed on Murray & Co. Vs. Ashok Kumar

Newatia (2000) 2 SCC 367 in relation to Contempt of Courts Act

and not Section 340 of the Cr.PC, laying down that whether a person

has by his alleged act obtained any definite advantage or not is not a

relevant factor for deciding whether the act constituted contempt of

court or not though the same may be relevant for deciding the

quantum of punishment. It was urged that the same principle would

apply to Section 340 of the Cr.PC also and whether the respondent

had benefited in any way whatsoever from fabrication of

documents/evidence is not a relevant consideration.

12. Per contra, the senior counsel for the plaintiff/non-applicant

has urged that the defendants have not denied using the drawings

Annexure B-1 to B-10 to the plaint. It is argued that thus the

question for determination in the suit is whether Annexure B-1 to B-

10 to the plaint are copies of Annexure A-1 to A-11 to the plaint. It is

further urged that out of 85 items in the comparative chart filed with

the affidavit dated 10th September, 2001 of Mr. G.S. Rihal, the

correctness of only two entries is challenged.

13. It is also the contention of the senior counsel for the

plaintiff/non-applicant that the plaintiff has at various times filed

different drawings; that the plaintiff was from time to time filing

drawings as improved from time to time. Reference in this regard is

also made to the order dated 2nd August, 2007. On that date, during

the cross examination of Mr. G.S. Rihal, it was recorded that the

plaintiff had along with the suit filed only photocopies of the

drawings Annexure A-1 to A-11 to the plaint; that original drawings

on tracing paper were filed by the plaintiff in 2006; however, the

original drawings were found to be not tallying with the photocopies

filed as Annexure A-1 to A-11 to the plaint. The submission of the

counsel for the plaintiff on that day was that the component

drawings were modified from time to time and what had been filed

by the plaintiff in the year 2006 were the drawings of the same

component duly upgraded since the year 1999 when the suit was

filed and that the original drawings had the same basic features

except that there were modifications concerning improvements made

by the plaintiff in the design. The contention of the counsel for the

defendants was that no copies of the drawings filed in the year 2006

had been supplied to the defendants and the plaintiff had not sought

leave of the court before placing the modified drawings on record.

This court on 2nd August, 2007 held that since the drawings filed in

2006 were not new documents but originals of Annexure A-1 to A-11

with slight modifications, the original drawings filed in 2006 shall be

considered as part of the record.

14. The defendants preferred an appeal being FAO (OS)

No.321/2007 to the Division Bench against the order aforesaid. The

said appeal was disposed of on 21st August, 2007. The counsel for the

plaintiff herein contended before the Division Bench that the suit

was and continued to be based entirely on the drawings Annexure

A-1 to A-11 to the plaint and that even though the single judge had

vide order dated 2nd August, 2007 allowed the original drawings filed

in 2006 to be brought on record, the plaintiff would not be relying on

the modifications made in the said drawings over and above

Annexure A-1 to A-11 to the plaint and the suit would continue as on

the basis of Annexure A-1 to A-11 to the plaint. On the basis of the

said statement of the counsel for the plaintiff the appeal was

disposed of.

15. It was suggested by the senior counsel for the plaintiff that in

fact the differences have arisen between the drawings Annexure A-1

to A-11 to the plaint filed in 1999 and the drawings filed along with

the affidavit of Mr. Manrao in the year 2001 and which are alleged to

be fabricated, also on account of the modifications carried out by the

plaintiff from time to time. It is further contended that after the

orders aforesaid in the appeal the entire basis of the application is

eroded.

16. As far as reference to the cross examination of Mr. G.S. Rihal

is concerned, it is contended that the statements relied upon show

that he has answered fairly and wherever a mistake had been

committed has admitted the same.

17. It is also contended that the defendants/non-applicants have in

their rejoinder to the application shied away from giving parawise

reply to the specific averments in the reply to the application by the

plaintiff. It is contended that in fact the application is preferred to

intimidate the witnesses of the plaintiff. Reliance is placed on

Chandrapal Singh Vs. Maharaj Singh (1982) 1 SCC 466 holding

that merely because the evidence of a witness is not accepted does

not tantamount to the offence of perjury; falsity can be alleged when

truth stands glaringly and to the knowledge of the person alleged to

be making a false statement and further that if in all cases where

complaints of perjury were to be filed against the losing party, it

would amount to abuse of the process of the court.

18. In my opinion, an application under Section 340 of the Cr.PC

ought to be normally considered at the time of final decision of the

case only and not at the interim stage as the defendants/applicant

have pressed in the present case. It is the settled legal position that

the said provision cannot be resorted to, to satisfy a private grudge

of the litigant. In fact the very genesis of this provision is to prevent

complaints being filed of offences having being committed in relation

to the court proceedings; it was felt that if such complaints are

permitted to be filed, the same may be used to force the other party

into giving up its claim/defence or to dissuade witnesses from

appearing before the courts under threat of criminal prosecution. It

was held as far back as in Rewashankar Moolchand Vs. Emperor

AIR 1940 Nagpur 72 that proceedings under Section 340 Cr.PC

should not be resorted to when the criminal case is calculated to

hamper fair trial of issue in the civil court before which the matter

would probably go on for longer. This court also in M/s Jindal

Polyster Ltd. Vs. Rahul Jaura 124 (2005) DLT 613 and in Kuldeep

Kapoor Vs. Susanta Sengupta 126 (2006) DLT 149 has held that

applications under Section 340 of the Cr.PC should be dealt with at

the final stage only and not at the interim stage. I also find a

consistency of view in this regard in the other High Courts. The law

is that a prosecution for perjury should not be ordered by the court

before the close of the proceedings in the case in which false

evidence is given. It is highly wrong for a court to take action under

the said provision against a witness or a party for giving false

evidence when trial is underway.

19. Section 340 of the Cr.PC cannot be resorted to when

genuineness of documents alleged to be forged and false in a case

was still subject matter of a pending civil suit. The application is

thus liable to be dismissed on this ground alone. The question of

deferring the decision on the application does not arise since the

counsel for the defendants/applicants had been warned in this

regard as noted herein above.

20. Even otherwise I entertain serious doubt as to whether in the

aforesaid facts it can be said that any perjury has been committed or

documents fabricated. The documents alleged to have been

fabricated are drawings showing the differences between various

sets of other drawings. Perjury is alleged in the matter of deposition

as to the differences or similarity in one set of drawings with the

other set of drawings. Such drawings/documents and depositions

would fall in the domain of an opinion and no action for fabrication

or perjury would lie. It may ultimately be held in the suit that the

opinion held by the persons against whom criminal prosecution is

sought to be lodged was wrong. But to say that the said opinion

found to be wrong by the court was deliberate or intentional is a

entirely different thing. Merely because an expert in the subject, as

Mr. Manrao and Mr. Rihal are, held an opinion which is found to be

wrong by the court or which is dissented from by the defendants is

no ground for prosecuting them. I may notice that this court in Net

Ram Vs. Beant Singh (1985) 28 DLT 318 in spite of finding a site

plan filed by the party to be contrary to the site did not allow an

application under Section 340 of the Cr.PC on that ground.

21. Formation of prima facie opinion that a person charged has

intentionally given false evidence is a condition precedent for

directing lodging of a complaint. The existence of mens rea or

criminal intention behind act complained of will have to be looked

into and considered before any action under Section 340 of the

Cr.PC is recommended. Before setting the criminal law into motion,

the court should exercise great care and caution and it must be

satisfied that there is reasonable foundation for the charge in

respect of which prosecution is directed. No prosecution ought to be

ordered unless reasonable probability of conviction is found.

Considering the nature of the documents and evidence in relation

whereto offences are alleged to have been committed, I find the said

ingredients to be lacking in the present case.

22. The affidavits of Mr. Manrao and Mr. Rihal aforesaid were in

the nature of pleadings of the plaintiff. The court must be very

cautious in its approach in prosecuting a person for making any

statement claimed to be false in regard to a pleading, so that party's

right to plead freely is not curtailed and he can take appropriate

pleadings throwing the burden on the opponent to prove the case to

the contrary.

23. It cannot also be lost sight of that in criminal prosecution there

is waste of public funds and time of courts. For this reason also in

every case of perjury the court would not mechanically take

cognizance or direct prosecution. Prosecution should be ordered

only when it is considered expedient and in the interest of justice to

punish the delinquent. Every incorrect or false statement does not

make it incumbent on the court to order prosecution.

24. There is yet another principle of law though relating to

witnesses. A witness is entitled to an opportunity to correct himself.

In the present case, Mr. Rihal during the cross examination admitted

two mistakes in the drawings alleged to be fabricated. Mr. Rihal

having corrected himself, ought not to be prosecuted.

25. This court in Rawal Singh Vs. Quality Stores AIR 1986

(Delhi) 236 in spite of finding a document having been fabricated,

yet dismissed the application under Section 340 of the Cr.PC finding

it not to be a fit case for recourse to any such action. In my view, the

application under Section 340 of the Cr.PC at this stage if allowed

would give a handle to the defendants against the plaintiff and would

give unfair advantage to the defendants over plaintiff in the suit

proceedings. It is still to be investigated and found out by this court

as to whether the plaintiff had devised improvements/modifications

over and above the drawings of CMERI and if so whether the

defendants have copied/infringed the said drawings of the plaintiff.

Allowing the application at this stage would tantamount to this court

returning finding that the drawings of the plaintiff are the same as

that of the CMERI. While the proposition in R. Karuppan (Supra) &

Mahila Vinod Kumari (Supra) cannot be disputed, it cannot also

be lost sight of that too frequent prosecutions for such offences tend

to defeat its very object. It is only in glaring cases of falsity where

conviction is highly likely that the court should direct prosecution.

26. For all the aforesaid reasons, I do not find any case for

allowing application to be made out. The same is dismissed.

No order as to costs.

RAJIV SAHAI ENDLAW (JUDGE)

September 18th, 2009 PP

#

% 19.09.2009

Present:

+ IA No.1764/2002 in CS(OS) No.470/2004.

* Vide separate order announced today the IA No.1764/2002

has been dismissed. The plaintiff has already concluded its evidence.

The defendants if till now have not filed affidavits by way of

examination in chief of their witnesses to file the same within four

weeks of today. List before the Joint Registrar on 4th November,

2009 for fixing the dates for cross examination of the witnesses of

the defendants.

RAJIV SAHAI ENDLAW,J

September 19th, 2009 PP