Societe Des Produits Nestle S.A. & ... vs Italian Edibles Pvt. Ltd.
2015 Latest Caselaw 7235 Del

       IN THE HIGH COURT OF DELHI AT NEW DELHI

%                           Order delivered on: 22nd September, 2015

+              I.A. No.18210/2013 in CS(OS) No.1084/2013

       SOCIETE DES PRODUITS NESTLE S.A. & ANR.     ..... Plaintiffs
                      Through  Ms.Prathiba M. Singh, Sr. Adv. with
                               Mr.Sudeep Chatterjee and Mr.Kapil
                               Midha, Advs.


                        versus


       ITALIAN EDIBLES PVT. LTD.                  ..... Defendant
                      Through    Mr.Sanjeev Singh, Adv.

       CORAM:
       HON'BLE MR.JUSTICE MANMOHAN SINGH

MANMOHAN SINGH, J. (ORAL)

1. By way of this order I propose to decide the abovementioned application under Order VII Rule 10 and 11 read with Section 151 CPC for return of plaint or in the alternate the suit be dismissed with costs.

2. The plaintiffs have filed the suit for permanent injunction restraining passing off, misuse of plaintiffs well-known mark "MAGGI HUNGROOO" or a similar mark by the defendant and for damages and rendition of accounts against the defendant.

3. Counsel for the defendant submits that in view of the statement made in para 33 of the plaint itself, this Court has no territorial jurisdiction to entertain and try the suit. He further submits that no cause of action has arisen within the territory of this Court as the defendant is carrying on its business at Indore. There is also no

averment in the plaint to the effect that the defendant is carrying on business within the territory of this Court. Since no relief whatsoever is sought by the plaintiffs for infringement of copyright, therefore, the plaintiffs are not entitled to invoke Section 62 of the Copyright Act. The plaint is therefore liable to be returned or in the alternate the same be dismissed with costs.

4. Reply to this application has been filed. Plaintiff has invoked the jurisdiction of this Court on the basis that the cause of action has arisen within the territory of this Court. The plaintiff No.2 is manufacturing, marketing and selling noodles under the trademark HUNGROOO within the territorial jurisdiction of this Court. The plaintiff No.2 has its office within the territory of Delhi. Further, the goods are being advertised on the website of the defendant which is accessible at Delhi. In fact there is an imminent threat that the defendant may sell its goods in Delhi.

5. I have heard the learned counsel for the parties. Para 33 of the plaint reads as under:

"33. This Hon'ble Court has the jurisdiction to try and entertain the present suit as the cause of action has arisen within the territorial jurisdiction of this Hon'ble Court. The legal notice of the Defendant has been served upon the Plaintiffs in Delhi. The Defendant has also issued threats to the Plaintiffs and is likely to take other steps to obstruct and thwart the business of the Plaintiffs within the territorial jurisdiction of this Hon'ble Court. The Defendant's application for registration of the trade mark has been filed without any territorial restriction. The manufacturing, marketing and sale of "MAGGI HUNGROOO" is being carried out by Plaintiff no.2 in India, whose registered office is located in Delhi. This Hon'ble Court also has jurisdiction to try and entertain the present suit under Section 62 of the Copyright Act, 1957. This Hon'ble Court, therefore, has the jurisdiction to try and entertain the present suit."

6. Counsel for the defendant has not denied the fact that the goods of the defendant are advertised on the website of the defendant which is accessible at Delhi. He has also not denied that the plaintiff No.2 has its office in Delhi. The defendant has also not denied the documents placed on record which the defendant claims to be selling its products to many business houses in India and also has a huge and diverse trusted supplier network. The defendant has also not denied the fact that it has applied for registration of the trade mark HUNGROO claiming the user for whole of India. Averment in the plaint has also been made by the plaintiff that there is an imminent threat whereby the defendant may sell its products in Delhi in due course. The law on the issue of jurisdiction is quite settled.

7. In Tata Iron & Steel Co. Ltd. v. Mahavir Steels & Ors.; 47(1992) DLT 412 by Anil Dev Singh, J. it was observed in paras 11 as under :

"11. The question regarding jurisdiction can only be gone into after the evidence of the parties is recorded in the case. Even in the Punjab case the suit was not thrown out at the threshold under Order 7 Rule 11 CPC but only after the parties were given an opportunity to lead evidence. The plaint in the present suit categorically states that the defendant no.1 was selling the channels of defendant no.2 under the offending trade mark which is deceptively similar to that of the plaintiff. On these averments the Court must assume jurisdiction and proceed with the suit to determine the question relating to the confirmation/vacation of the stay order at this stage."

8. This aspect has been decided by Justice Badar Durez Ahmed in Pfizer Products Inc. v. Rajesh Chopra & Ors, 2006(32) PTC 301(Delhi) wherein it was observed as under :-

"12. The other aspect of the matter is that a threat of selling the offending goods in Delhi would in itself confer jurisdiction in the courts in Delhi to entertain a suit claiming an injunction in respect thereof. Whether the threat perception is justified or not is another matter which has to be considered and decided upon in the application filed by the plaintiff under Order 39 Rules 1 and 2 or on merits when the suit is taken up for disposal. Insofar as Order 7 Rule 10 is concerned, assuming that whatever is stated in the plaint is correct, one would have to also assume that the threat or the intention of the defendants to sell and offer for sale the offending goods in Delhi is also correct. Therefore, if the threat exists then this court would certainly have jurisdiction to entertain the present suit."

9. In LG Corporation & Anr. v. Intermarket Electroplasters(P) Ltd. and Anr.; 2006 (32) PTC 429 decided by Justice A.K.Sikri, wherein the following observations were made in para 7 :-

"7. ......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....."

10. In the present case it is an undisputed fact that the plaintiffs are residing and carrying on business within the territory of this Court. The allegation made in the plaint is also that the defendant has advanced threat to interfere in the rights of the plaintiffs at Delhi.

11. As already mentioned that the defendant's counsel has not denied the fact that the defendant has filed an application for registration for manufacturing and marketing the goods all over India. Even on this ground this Court has got the jurisdiction which shows that the defendant had the intention to use the trademark in due course which is the admitted position in view of the statement made by the defendant itself.

12. In the case of M/s. Jawahar Engineering Company and others v. M/s.Javahar Engineers Pvt. Ltd., AIR 1984 Delhi 166 (Division Bench), it was observed as under:

"There is another ground for holding that the Court has jurisdiction. Section 20 of the Code of Civil Procedure shows that a suit like the present can be filed wherever the cause of action wholly or partly arises. The plaintiffs has prayed for an injunction regarding a threatened breach of a registered trade mark. The learned Single Judge held that the Delhi Court does not have jurisdiction on the ground of any sale having been made in Delhi, but does have jurisdiction on account of the advertisement having appeared in the Trade Marks Journal. The real point which gives the Court jurisdiction is not the place where the advertisement has appeared, but the fact that the trade mark is sought for sale in Delhi amongst other places. Furthermore, when an injunction is sought, it is not necessary that the threat should have become a reality before the injunction and it can even be sought for a threat that is still to materialise.

An injunction being prohibitive in nature is intended to prevent something that is likely to happen. Once the plaintiffs have learnt that the defendants have applied for registration of trade mark in Delhi, they can claim an injunction to prevent any sale of the infringing product in Delhi. In this sense, the Court will have jurisdiction whether any sale in Delhi has taken place or not. In any case, as already stated, the decision is of a preliminary nature; once the exact scope of what the defendants intend to do is known, it is open to the Court to return the plaint. In that sense, it is not a final decision and is not open to appeal at the preliminary stage being not a final adjudication."

13. As far as availability of goods on the website of the defendant is concerned, the Division Bench of this Court has very recently in the case of World Wrestling Entertainment, Inc. v. Reshma

Collection & Ors., 2014 (60) PTC 452 (Delhi) (DB), has observed as under:

"21. But, we are not concerned with the question of cause of action between the appellant/ plaintiff and its customers in Delhi because the defendants are not such customers and they are, in any event, all residents of Mumbai. What we are examining is whether the third condition specified in Dhodha House (supra) is satisfied or not. In other words, if the contracts and/ or transactions entered into between the appellant/ plaintiff on the one hand and its customers are being concluded in Delhi, can it not be said that the essential part of the business of the appellant/ plaintiff, insofar as its transactions with customers in Delhi are concerned, takes place in Delhi? The offers are made by customers at Delhi. The offers are subject to confirmation/ acceptance of the appellant/ plaintiff through its website. The money would emanate or be paid from Delhi. Can it not then be considered that the appellant/ plaintiff is, to a certain extent, carrying on business at Delhi? In our view, it would be so. Because of the advancements in technology and the rapid growth of new models of conducting business over the internet, it is possible for an entity to have a virtual presence in a place which is located at a distance from the place where it has a physical presence. The availability of transactions through the website at a particular place is virtually the same thing as a seller having shops in that place in the physical world. Let us assume for the sake of argument that the appellant/ plaintiff had a shop in Delhi from where it sold its various goods and services. In that case, it could not be denied that the plaintiff carried on business in Delhi. This is apart from the fact that the appellant/ plaintiff may also have been regarded as having voluntarily resided in Delhi. When the shop in the 'physical sense' is replaced by the 'virtual' shop because of the advancement of technology, in our view, it cannot be said that the appellant/ plaintiff would not carry on business in Delhi.

22. Therefore, in our view, although the learned Single Judge had made a correct reference to the decision of the Supreme Court in the case of Bhagwan Goverdhandas

Kedia (supra), the full ramifications of that decision were not perceived by him. When the two decisions of the Supreme Court in Bhagwan Goverdhandas Kedia (supra) and Dhodha House (supra) are considered in the manner indicated above, it would appear that, on the averments made by the appellant/ plaintiff in the plaint, the Delhi High court would, on a demurrer, have jurisdiction to entertain the suit inasmuch as the appellant/ plaintiff would be regarded as carrying on business in Delhi within the meaning of the expression under Section 134(2) of the Trademarks Act, 1999 and Section 62(2) of the Copyright Act, 1957. Consequently, the learned Single Judge ought not to have returned the plaint under Order 7 Rule 10 CPC. As a result, the impugned order is set aside and the suit is restored to its original number and the same be placed before the Roster Bench for further steps therein on 28.10.2014, in the first instance. This, however, would not preclude the defendants from raising the plea of jurisdiction on facts which, if raised, could be considered by the court based on the evidence and upon the law explained above. The appeal is allowed, as above."

14. From the above it emerges that the averment made in the plaint about the territorial jurisdiction is to be taken as correct. The plaint cannot be rejected if the averment is supported by some prima facie evidence filed along with the plaint, as under these circumstances, the issue of territorial jurisdiction would become mixed question of law and fact and it would be appropriate to postpone the issue for trial. The earlier decisions passed by the Court are binding and the same cannot be ignored. Due respect has to be given while considering the said issue.

15. Under these circumstances, there is no merit in the application. The same is accordingly dismissed.

CS(OS) No.1084/2013 List the matter before the Joint Registrar for admission/denial of the documents on 16th November, 2015, the date already fixed. List before Court for framing of issues and hearing on interim application on 20th November, 2015, the date already fixed.

(MANMOHAN SINGH) JUDGE SEPTEMBER 22, 2015