Microsoft Corporation & Anr. vs Hitendra Idnani & Anr.
2014 Latest Caselaw 1282 Del

             *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                       Date of decision: 10th March, 2014.

+                               CS(OS) 2403/2008

       MICROSOFT CORPORATION & ANR.             ..... Plaintiffs
                   Through: Ms. Jaya Negi, Adv.

                                   Versus

    HITENDRA IDNANI & ANR.                                   ..... Defendants
                 Through: None.
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1.     The plaintiffs have instituted the present suit for an order of

permanent injunction restraining the defendants from violating the

plaintiffs' copyright by way of unauthorized hard-disk loading of the

plaintiffs' software on the branded computers sold by them to their

customers, and for ancillary reliefs of delivery-up, rendition of accounts and

damages, pleading:

       (I)     that the plaintiff no. 1 Microsoft Corporation is a company

       organized and existing under the laws of the State of Washington,

       USA and engaged in manufacturing and licensing a range of software

       products, whereas plaintiff no. 2 Microsoft Corporation India Pvt.




CS(OS) No.2403/2008                                                Page 1 of 7
        Ltd. is its wholly owned marketing subsidiary having its office in

       Nehru Place, New Delhi;

       (II)   that the popular software products developed and marketed by

       the plaintiffs such as MICROSOFT WINDOWS and MICROSOFT

       OFFICE are 'computer programs' within the meaning of Section

       2(ffc) of the Copyright Act, 1957 and included in the definition of

       'literary works' as per Section 2(o) of the Act and the plaintiffs being

       the owner of the copyright in the aforesaid literary works are entitled

       to all the exclusive rights flowing from such ownership enumerated

       under Section 14 of the Copyright Act;

       (III) that the plaintiffs' computer programs are 'works' that have

       been first published and registered in the USA, and as such also enjoy

       protection in India by virtue of Section 40 of the Copyright Act read

       with the International Copyright Order, 1999;

       (IV) that the plaintiffs in the month of November 2008 learnt that

       the defendant no. 1 Mr. Hitendra Idnani, in his capacity as proprietor

       of defendant no. 2 M/s Laptech Solutions Pvt. Ltd. - a business entity

       engaged in marketing and selling of computer hardware (including

       computer accessories and peripherals) and having its offices/shops in


CS(OS) No.2403/2008                                                 Page 2 of 7
        Pune - was infringing the plaintiffs' copyrights and other intellectual

       property rights by unauthorized hard-disk loading of the plaintiffs'

       software on the branded computers sold by him to his customers;

       (V)    that accordingly the plaintiffs deployed an independent

       investigator to purchase one of such computers being sold by the

       defendants and which confirmed that the defendants were offering

       their customers pre-loaded software of the plaintiffs without charging

       any additional costs;

       (VI) that the computer purchased by the independent investigator

       from the defendants was also inspected by the plaintiffs' technical

       expert and which revealed that software programs of the plaintiffs'

       being MICROSOFT WINDOWS XP (Professional Version 2002)

       and MICROSOFT OFFICE (2007), were present on the computer

       without any authorization from the plaintiffs; and,

       (VII) that since the software programs supplied by the defendants

       were not accompanied by the Certificate of Authenticity Label,

       Holographic CD and the User Manual which are supplied by the

       plaintiffs along with their software, it was evident that the software




CS(OS) No.2403/2008                                                 Page 3 of 7
        programs pre-loaded by the defendants on the hard-disk of the

       computer sold to the independent investigator were pirated versions.

2.     This Court issued summons in the suit to the defendants on

19.11.2008 and vide order of the same date granted an ex-parte ad-interim

injunction in favor of the plaintiffs. Though a Local Commissioner was also

appointed by this Court at the request of the plaintiffs to inspect one of the

premises of the defendants, however no report of the Local Commissioner is

found on record. Since none appeared on behalf of the defendants despite

due service, they were ordered to be proceeded ex-parte vide order dated

04.05.2009 and the interim order dated 19.11.2008 was made absolute.

Upon the plaintiffs, tendering their ex-parte evidence, the suit was listed for

ex-parte hearing on 22.11.2013, when this Court stressed the need for the

plaintiffs to also examine the independent investigator and the technical

expert, upon whose reports the plaintiffs have predicated their case for

infringement of copyright, and adjourned the matter for today to enable the

plaintiffs to produce the said witnesses. Though the counsel for the plaintiffs

has circulated an adjournment slip for today, but considering that the ex-

parte matter has been languishing for more than five years now and that

locating and examining the independent investigator and the technical


CS(OS) No.2403/2008                                                 Page 4 of 7
 expert would consume further substantial time, I have nevertheless perused

the record to ascertain whether a decree can be passed forthwith.

3.     The plaintiffs, in support of their case, have examined one witness -

Mr. Achuthan Sreekumar, the Constituted Attorney of the plaintiffs, who

has tendered in evidence the Court Certified Copies of Original Copyright

Registration Certificates of the various software programs of the plaintiffs

(including MICROSOFT WINDOWS XP and MICROSOFT OFFICE).

4.     The defendants, though ex-parte in the matter, are found to have filed

a written statement as well as a reply to the application of the plaintiffs for

temporary injunction under Order 39 Rule 1 & 2 of the CPC. However, a

perusal of the same reveals no substantial defense to have been raised by the

defendants to the case set up by the plaintiffs.

5.     As far as the primary relief of permanent injunction is concerned, I

am of the opinion that the plaintiffs have made out a case of infringement of

their copyright and other intellectual property rights by the defendants.

Though, as pointed out vide order dated 22.11.2013, it perhaps would have

been desirable that the independent investigator and technical expert

employed by the plaintiffs were personally examined, I do not see the

omission to do so as being fatal to the case of the plaintiffs insofar as I find


CS(OS) No.2403/2008                                                  Page 5 of 7
 on the record the original duly notarized affidavits of the two and the

contents whereof alongwith supporting documents filed as annexures

thereto, in my opinion sufficiently corroborate and affirm the averments

made in the plaint in this regard. There is no reason for this Court to

disbelieve the said affidavits and a technical error, if any, in my opinion

must not prevent the Court from passing an order of permanent injunction

preventing infringement of intellectual property rights, where there is

otherwise sufficient material on record to sustain such a finding. Moreover,

by issuing such injunction, the Court is doing nothing more than enforcing

the law as the activity which the defendant is proved to be indulging in,

there can be no doubt, is illegal. I accordingly pass a decree for permanent

injunction in terms of prayer paragraph (a) of the plaint and also order

delivery-up of the infringing copies of the plaintiffs' software programs.

6.     The plaintiffs have also claimed damages of Rs.20 lakhs from the

defendants on account of various factors such as illegal profits earned by the

defendant by sale of such pirated software, loss of revenue to the plaintiffs

from such unauthorized sale, as well as damage to the plaintiffs' reputation

and goodwill by such infringing activities of the defendants. This Court in

Time Incorporated Vs. Lokesh Srivastava 2005 (30) PTC 3 (Del.), while


CS(OS) No.2403/2008                                                 Page 6 of 7
 awarding punitive damages of Rs.5 lakhs in addition to compensatory

damages also of Rs.5 lakhs has held that time has come when the Courts

dealing in actions for infringement of trademarks, copyrights, patents etc.,

should not only grant compensatory damages but also award punitive

damages with a view to discourage and dishearten law breakers who indulge

in violation with impunity out of lust for money, so that they realize that in

case they are caught, they would be liable not only to reimburse the

aggrieved party but would be liable to pay punitive damages also, which

may spell financial disaster for them. In the facts and circumstances of this

case, I deem it fit to award damages to the tune Rs.5 lakhs with a right to the

plaintiffs to demand rendition of accounts from the defendant in order to

ascertain and receive the shortfall, if any, in the figure awarded above.

7.     Decree Sheet be drawn up in the aforesaid terms. The plaintiffs shall

also be entitled to costs of the suit with the counsel's fees quantified at

Rs.20,000/-.



                                               RAJIV SAHAI ENDLAW, J.

MARCH 10, 2014. aa