Microsoft Corporation & Anr vs Rajesh Kumar & Ors
2017 Latest Caselaw 5752 Del

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*     IN THE HIGH COURT OF DELHI AT NEW DELHI
%                                       Reserved on: 27th September, 2017
                                         Pronounced on: 17th October, 2017

+     CS(COMM) 444/2016 & IA No.14114/2014

      MICROSOFT CORPORATION & ANR                ..... Plaintiffs
                   Through : Ms.Sajia Said, Adv.

                            versus

      RAJESH KUMAR & ORS                                     ..... Defendants
                  Through :                Mr.Rakesh Kumar and Mr.Anil
                                           Kumar Sahu, Advs.
CORAM:
HON'BLE MR. JUSTICE YOGESH KHANNA

YOGESH KHANNA, J.

IA No.5518/2016

1. This application under Order 7 Rule 10 CPC is moved by the defendants. It is alleged that in the entire plaint there is no averment of plaintiff's copyright violation within the territorial jurisdiction of this Court and rather per averments made in the plaint, the cause of action has arisen only at Gurugram, Haryana and in Hyderabad, Telangana at which places the plaintiffs have their offices and are also carrying its business, therefore, it is alleged this Court has no territorial jurisdiction to entertain this suit and the plaint be returned.

2. The learned counsel for the defendant has placed his reliance upon the decision in Ultra Home Construction Pvt. Ltd. vs. Purushottam Kumar Chaubey & Ors 2016 (4) R.A.J. 352 (Delhi) wherein while deciding the issue of territorial jurisdiction of Court under Section 134(2) of the Trademarks Act, 1999 and under Section 62(2) of the Copyright Act, 1957 in the light of the decision of the Supreme Court in Indian Performing Right Society Limited vs. Sanjay Dalia (2015) 10 SCC 661 has held as under:-

"i. First instance is the case where the plaintiff has a sole office. In such a case, even if the cause of action has arisen at a different place, the plaintiff can institute a suit at the place of the sole office; ii. Next is the case where the plaintiff has a principal office at one place and a subordinate or branch office at another place and the cause of action has arisen at the place of the principal ,office. In such a case, the plaintiff may sue at the place of the principal office but cannot sue at the place of the subordinate office;

iii. The third case is where the plaintiff has a principal office at one place and the cause of action has arisen at the place where its subordinate office is located. In such an eventuality, the plaintiff would be deemed to carry on business at the place of his subordinate office and not at the place of the principal office; and iv. The fourth case is where the cause of action neither arises at the place of the principal office nor at the place of the subordinate office but at some other place. In this case, the plaintiff would be deemed to carry on business at the place of its principal office and not at the place of the subordinate office. And, consequently, it could

institute a suit at the place of its principal office but not at the place of its subordinate office."

3. Thus, it is alleged by the learned counsel for the defendants that since the plaintiff has business and its subordinate offices at Gurugram and at Hyderabad and at which places the cause of action has also arisen so this court has no jurisdiction to try and decide this suit and the plaint be returned directing the plaintiff to file it at appropriate jurisdiction.

4. To press his argument the learned counsel for the defendants has also relied upon Bigtree Entertainment Pvt Ltd vs. Saturday Sunday Media Internet & Ors CS(Comm) No.53/2015 decided on 21.12.2015; M/s Allied Blenders & Distillers Pvt Ltd vs R.K. Distilleries Pvt ltd CS (OS) No.2266/2013 decided on 27.07.2016; Pepsico Inc & Anr vs. M/s Sagarnil Enterprises & Ors CS (COMM) 960/2016 decided on 21.12.2016; and Federal Express Corporation vs Fedex Securities Limited & Ors CS (OS) No.2213/2014 decided on 11.04.2017, which support the view taken in Ultra Home (supra) hence, there is no dispute qua the proposition of law laid in above cited cases, including Ultra Home (supra).

5. However, I need to refer to para No.28 of the plaint, which read as under:-

"28. This Hon'ble Court has jurisdiction to entertain and try the present Suit by virtue of Section 62 (2) of the Copyright Act, 1957 as the Plaintiff No.2, Microsoft Corporation India Private Limited, carries on business in New Delhi, from Eros Corporate Towers, 5th Floor, Nehru

Place, New Delhi - 110 019. The cause of action has also arisen within the territorial jurisdiction of this Hon'ble Court as the Plaintiffs believes that the Defendants would be servicing their clients, using the unlicensed software programs of the Plaintiffs, on the Defendants' employees laptops, during presentations etc, in Delhi."

6. The defendants have answered the above averments in its corresponding para No.28 of written statement which read as under:-

"28. That the contents of para 28 of the plaint are wrong therefore vehemently denied. It is denied that this Hon'ble Court has territorial and pecuniary jurisdiction to adjudicate the present suit. Besides, it is submitted that this Hon'ble Court has no territorial jurisdiction to adjudicate the present suit because admittedly neither plaintiff no. 1, who the plaintiffs claim to be owner of the copyright in the software in question has any office within territorial jurisdiction of this Hon'ble Court nor it works for gain therein. Plaintiff no. 2 being neither owner of any copyright in the software in question nor being assignee of the same has no locus standi to maintain the present suit against the defendants. Therefore this Hon'ble Court has no territorial jurisdiction to adjudicate the present suit as the Defendant are based in Gurgaon (Haryana) and Hyderabad (Telengana) where cause of action, if there is any, would have a arisen. So far as belief of the plaintiffs that the defendants would have been serving their clients in Delhi is a speculation and such speculation cannot confer this Hon'ble Court territorial jurisdiction to adjudicate the present suit."

7. In its para No.28 of written statement, apropos the cause of action the defendant does not unequivocally repudiate the allegations of its

servicing clients in Delhi by using the plaintiffs unlicensed/ licensed software programmes. It merely casts them in speculative light, which a fortiori, necessitates a trial to conclusively determine the issue.

8. The plaintiff has also filed a print out of the website of the defendants - annexure A to its reply to application under Order 7 Rule 10 CPC and refers to page No.14 wherein the defendant alleges itself to be a global software services company headquartered at New Jersey, USA and having other offices in DC Metros area and a state of the art outsourced software development based out of New Delhi, India. Further, the information at page No.18 and 29 of annexure A, is deleted, as could allegedly be related to the business at Delhi. At page No.24 of its website, the defendant admitted that they are using the plaintiff's technology and further at page No.37, the defendants write „Tekriti Software is a high-growth IT services company, with significant operations both in USA (New Jersey and Washington DC Metro area) and India (New Delhi/Hyderabad area). Further, at its page No.46, it notes the governing laws "the foregoing are subject to the laws of the Republic of India and the Courts in New Delhi, India shall have the exclusive jurisdiction on any dispute that may arise out of the use of this site."

9. Thus the defendants own documents at its website gives hints of its operative offices at New Delhi. Further, I may refer to Pfizer Enterprises Sarl vs. Cipla Limited ILR (2009) II Delhi 676 this Court observed:-

"7. 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.

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. ......

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. ....."

10. Further in LT Foods Limited vs Heritage Foods (India) Limited 210 (2014) DLT 721 (DB), while referring the observation of the Supreme Court in Exphar SA v. Eupharma Laboratories Ltd., A.I.R. 2004 SC 1682, this Court held:-

"9. xxx...In rejecting a plaint on the ground of jurisdiction, the Division Bench should have taken the allegations contained in the plaint to be correct"

13. Ms Prathiba Singh, the learned senior counsel, also pointed out that while in paragraph 26 of the plaint there is mention of the „cease and desist‟ notice dated 04.03.2011, there is also mention of the appellant‟s / plaintiff‟s reply to the said notice dated 19.04.2011 where the plaintiff has denied the statement of the defendant in the said notice dated 04.03.2011 to the effect that the defendant sold or supplied, directly or indirectly, the goods bearing the trade mark "HERITAGE" throughout the length and breadth of the country. However, we feel that this does not enable the respondent / defendant, at this prima-facie stage, to detract

from the position that the respondent / defendant had, in the said notice dated 04.03.2011, clearly stated that it had sold the goods under the said trade mark "HERITAGE" directly or indirectly throughout the length and breadth of the country which, obviously, would include Delhi as well. Whether the respondent / defendant can explain this admission and explain the circumstances so that it is not bound by it is a matter for trial. But at this prima-facie stage, the appellant / plaintiff has founded his cause of action on passing off on this admission on the part of the respondent / defendant and it is immaterial that the appellant / plaintiff had in its reply to the notice taken a contrary view."

11. Considering the law laid down in Pfizer's case (supra) and LT foods Ltd case (supra) it was incumbent upon the defendant to specifically deny each and every assertion of the plaintiff qua territorial jurisdiction lest there shall be a deemed admission. Coming to the facts of this case where the defendants on its website has admitted of its offices at New Delhi, it being a global company and per its governing laws viz. courts in New Delhi has the exclusive jurisdiction; coupled with the fact of no specific denial in its written statement to the averments made in para 28 of the plaint viz. the defendant deemed to have admitted such allegations and hence, at this stage it cannot be said this court has no jurisdiction. This issue rather needs to be elaborately gone into in evidence. The application being devoid of merits is thus dismissed. No orders as to costs.

CS(COMM) 444/2016 & IA No.14114/2014

12. List on 19.03.2018.

YOGESH KHANNA, J OCTOBER 17, 2017 M/RS