Citation : 2023 Latest Caselaw 6 Kant
Judgement Date : 2 January, 2023
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 2ND DAY OF JANUARY, 2023
BEFORE
THE HON'BLE MR. JUSTICE RAVI V. HOSMANI
M.F.A.NO.7382 OF 2022 (IPR)
C/W
M.F.A.NO.7914 OF 2022 (IPR)
IN M.F.A.NO.7382/2022:
BETWEEN:
M/s. BTV KANNADA PRIVATE LIMITED,
DULY REP. BY ITS DIRECTORS,
IN TERM OF AUTHORIZATION UNDER BOARD
RESOLUTION DATED 06.09.2022
1(A) SEEMANAZ,
1(B) KRISHNAPPA BABU
NO.38, MAHAGANAPATHI NAGAR,
WEST OF CHORD ROAD,
BENGALURU-560 010.
PRESENT OFFICE AT NO.32/1-2,
CRESCENT TOWER, CRESCENT ROAD,
HIGH GROUNDS, BENGALURU-560 001.
...APPELLANT
[BY SRI. SUNIL S.RAO, ADVOCATE (PH)]
AND:
1. M/s. EAGLESIGHT MEDIA PRIVATE LIMITED ( ESMPL)
CHAIRMAN & DIRECTOR MR. ASHWIN MAHENDRA,
DULY REP. BY HIS AUTHORIZED PERSON,
MR. MAHENDRA B., (FATHER OF ASHWIN MAHENDRA)
VIDE LETTER OF AUTHORIZATION DATED 24/01/2022
AGED ABOUT 62 YEARS,
R/A NO.301/10 36TH CROSS,
7TH 'C' MAIN ROAD, JAYANAGARA,
4TH BLOCK, BENGALURU-560011.
2
2.
M/s. EAGLESIGHT TELE MEDIA PRIVATE LIMITED,
DULY REP. BY ITS DIRECTORS,
1(A) KRISHNAPPA BABU,
1(B) NARAYAN RAVI KUMAR,
NO.68, 1ST STAGE, 5TH PHASE,
MAHAGANAPATHINAGAR,
4TH MAIN ROAD, WEST OF CHORD ROAD,
SHIVANAGAR, BENGALURU-560 079.
3.
MR. GANGADHARAPPA MUNINDRA KUMAR
@ KUMAR G M,
S/O GANGADARAPPA MUNINDRA,
AGED ABOUT 47 YEARS,
EX. DIRECTOR OF M/s. EAGLESIGHT TELEMEDIA
PRIVATE LIMITED, (DEFENDANT NO.1 COMPANY)
NO.68, 1ST STAGE 5TH PHASE,
MAHAGANAPATHINAGAR, 4TH MAIN ROAD,
WEST OF CHORD ROAD, SHIVANAGAR,
BENGALURU-560 079.
4.
MRS. MALLEGOWDANAHALLI KRISHNA MANJULA @
MANJULA M. K., W/O MR. KUMAR G.M.,
AGED MAJOR, EX DIRECTOR OF
M/s. EAGLESIGHT TELEMEDIA PRIVATE LIMITED
(DEFENDANT NO.1 COMPANY)
NO.68, 1ST STAGE, 5TH PHASE,
MAHAGANAPATHINAGAR, 4TH MAIN ROAD,
WEST OF CHORD ROAD,
SHIVANAGAR, BENGALURU-560 079.
...RESPONDENTS
(BY SRI. K.N.PHANINDRA, SR. COUNSEL FOR C/R1 TO R3 (PH)]
3
IN M.F.A.NO.7914/2022:
BETWEEN:
1. M/S EAGLE SIGHT TELE MEDIA PRIVATE LIMITED
DULY REP. BY ITS DIRECTOR,
1(a) KRISHNAPPA BABU,
1(b) NARAYAN RAVI KUMAR,
NO.68, 1ST STAGE, 5TH PHASE,
MAHAGANAPATHINAGAR, 4TH MAIN ROAD,
WEST OF CHORD ROAD, SHIVANAGAR,
BENGALURU-560079.
REP. BY AUTHORIZED PERSON,
NARAYANA RAVI KUMAR, S/O NARAYANA,
AGED ABOUT 37 YEARS,
R/A NO.22, DK AND JK, N S IYENGAR STREET,
SHESHADRIPURAM, BENGALURU-560 020.
...APPELLANT
[BY SRI. D.R.RAVISHANKAR, SR. COUNSEL FOR
SRI. CHANDRASHEKAR L., ADVOCATE (PH)]
AND:
1. M/s. EAGLESIGHT MEDIA PRIVATE LIMITED (ESMPL)
CHAIRMAN AND DIRECTOR, ]
MR.ASHWIN MAHENDRA,
DULY REP. BY HIS AUTHORIZED PERSON,
MR.MAHEDNRA.B (FATHER OF ASHWIN MAHENDRA),
VIDE LETTER OF AUTHORIZATION DATED 24/01/2022,
AGED ABOUT 62 YEARS, R/A 301/10, 36TH CROSS,
7TH 'C' MAIN ROAD, JAYANAGARA 4TH BLOCK,
BENGALURU-560011.
2. M/S BTV KANNADA PRIVATE LIMITED
DULY REPRESENTED BY ITS DIRECTORS,
1(a) SEEMANAZ,
1(b) KRISHNAPPA BABU,
NO.38, MAHAGANAPATHI NAGAR,
WEST OF CHORD ROAD, BENGALURU-560010,
PRESENT OFFICE AT NO.32/1-2,
CRESCENT TOWER, CRESCENT ROAD,
HIGH GROUNDS, BENGALURU-560001.
4
3. MR GANGADHARAPPA MUNINDRA KUMAR
@ KUMAR G M,
S/O GANGADARAPPA MUNINDRA,
AGED ABOUT 47 YEARS,
EX.DIRECTOR OF M/s. EAGLESIGHT
TELEMEDIA PRIVATE LIMITED,
(DEFENDANT NO.1 COMPANY),
NO.68, 1ST STAGE, 5TH PHASE,
MAHAGANAPATHINAGAR, 4TH MAIN ROAD,
WEST OF CHORD ROAD, SHIVANAGAR,
BENGALURU-560 079.
4. MRS MALLEGOWDANAHALLI KRISHNA MANJULA
@ MANJULA M K
W/O MR. KUMAR G M, AGED MAJOR,
EX.DIRECTOR M/S EAGLESIGHT
TELEMEDIA PRIVATE LIMITED,
(DEFENDANT NO.1 COMPNANY),
NO.68, 1ST STAGE, 5TH PHASE,
MAHAGANAPATHINAGAR, 4TH MAIN ROAD,
WEST OF CHORD ROAD, SHIVANAGAR,
BENGALURU-560079.
...RESPONDENTS
(BY SRI. K.N.PHANINDRA, SR. COUNSEL FOR
SRI. DEEPAK B.R., ADVOCATE FOR C/R1 (PH)]
THIS M.F.A No.7382/2022 IS FILED UNDER ORDER 43 RULE 1 (r)
OF CPC, AGAINST THE ORDER DATED 05.09.2022 PASSED ON I.A.NO.1
TO 3 IN O.S.NO.584/2022 ON THE FILE OF THE XVIII ADDITIONAL CITY
CIVIL JUDGE, BENGALURU CITY, ALLOWING I.A.NO.1 FILED U/O 39 RULE
1 AND 2 R/W SEC.151 OF CPC., ALLOWING I.A.NO.2 AND 3 FILED U/S
151 OF CPC.,
THIS M.F.A No.7914/2022 IS FILED UNDER ORDER 43 RULE 1(r)
OF CPC, AGAINST THE ORDER DATED 05.09.2022 PASSED ON I.A.NO.1
TO 3 IN O.S.NO.584/2022 ON THE FILE OF THE XVIII ADDITIONAL CITY
CIVIL JUDGE, BENGALURU CITY, ALLOWING I.A.NO.1 FILED U/O 39 RULE
1 AND 2 R/W SEC.151 OF CPC.,
5
THESE APPEALS HAVING BEEN HEARD AND RESERVED FOR
JUDGMENT ON 25.11.2022, THIS DAY, THE COURT PRONOUNCED THE
FOLLOWING AT DHARWAD BENCH THROUGH VIDEO CONFERENCE:
JUDGMENT
Challenging impugned order dated 05.09.2022 passed by
XVIII Additional City Civil Judge, Bengaluru City, passed in
O.S.no.584/2022, above appeals are filed.
2. While MFA no.7382/2022 is filed by defendant no.2
challenging order passed on I.As.no.1 to 3. Respondent no.1
therein is plaintiff; respondent no.2 - defendant no.1 and
respondents no.3 and 4 herein were defendants no.3 and 4
respectively.
3. MFA no.7914/2022 is filed by defendant no.1 challenging
order passed on IA no.1. Respondent no.1 therein is plaintiff;
respondents no.2 to 4 herein were defendants no.2 to 4
respectively. For sake convenience they will be referred to as such
herein.
4. O.S.no.584/2022 was filed seeking for:
(a) permanent injunction restraining defendants,
its agents, employees, representatives,
henchmen or anybody claiming through or
under it from misusing and misrepresenting
the logo, contents, channel name, visuals, documents, office and studio premises, technical equipments, same employees and all other assets belonging to plaintiff company;
(b) Also restrain defendants not to enter into contracts or agreements with media partners and channel partners of plaintiff company by misusing name of plaintiff company;
(c) Such other orders/reliefs etc.
5. In said suit, plaintiff filed I.A.no.1 under Order XXXIX
Rules 1 and 2 of CPC for temporary injunction restraining
defendants restraining defendants, its agents, employees etc., from
misusing and misrepresenting logo, contents, channel name,
visuals, documents, office and studio premises, technical
equipments and all other assets of plaintiff company; and to
restrain defendants not to enter into contracts or agreements with
media and channel partners of plaintiff company by misusing name
of plaintiff etc., during pendency of suit.
6. I.A.no.2 was filed under Section 151 of CPC for
permission to appoint new security guards at office premises of
defendants and for police protection to safeguard company movable
assets, files, documents, contents and his technical equipments.
7. I.A.no.3 was also filed under Section 151 of CPC to
appoint his security guards and avail police protection to safe guard
his company movable assets, files, documents and his technical
equipments.
8. Applications were opposed by filing objections. Under
impugned order, trial Court considered IA nos.1 to 3 together and
allowed applications. Assailing same, defendants no.1 and 2 are in
appeal.
9. Sri. Sunil Rao, learned counsel for defendant no.2
submitted that appeal was filed challenging orders on IA nos.1 to 3.
It was submitted that though I.As.no.2 and 3 were filed under
Section 151 of CPC, relief sought were also in nature of temporary
injunction for protection of subject matter of suit. Therefore, orders
passed thereon were appealable under Order XLIII read with
Section 108 of CPC. Reference was made to decision of Hon'ble
Supreme Court in Shyam Sel & Power Ltd. Vs. Shyam Steel
Industries Ltd.,1 , wherein classifying judgments into three kinds:
(i) Final judgment (ii) Preliminary judgment and (iii) Intermediary
2022 SCC OnLine SC 313
or Interlocutory judgments, it was held that there may be
interlocutory orders which are not covered by Order XLIII Rule 1 of
CPC, but which also possess characteristics and trappings of finality
wherein they may adversely affect a valuable right of party or
decide an important aspect of trial and therefore appealable. It was
contended that hence orders passed on I.As.no.2 and 3 were also
appealable under Order XLIII of CPC.
10. Relying upon decision of Hon'ble Supreme Court in
Reliance Petro Chemicals Ltd., v/s Indian Express
Newspapers, Bom. Pvt. Ltd., reported in 1988 (4) SCC 592, it
was submitted that while considering continuation of preventive
injunction against an entity of press/media, it was necessary to
examine balance of convenience on basis of existence of present
and imminent danger as continuation of injunction would amount to
interference with freedom of press and people at large in a
democracy had right to know. It was submitted that where there
was no such imminent danger, continuation of injunction was no
longer necessary.
11. Relying upon decision of Hon'ble Supreme Court in case of
Transmission Corpn. of A.P. Ltd., and Ors. vs. Lanco
Kondapalli Power (P) Ltd.,2 it was submitted that while granting
temporary injunction, it was a matter of prudence to take only such
measures as are calculated to preserve status quo. While making
such observation, reference was made to decision of House of Lords
in American Cyanamid Co., v/s Ethicon Ltd.,3 wherein it was
held that if defendant is enjoined temporarily from doing something
that he has not done before, only effect of interlocutory injunction
in event of his succeeding in trial is to postpone date at which he is
able to embark on course of action, which he had not previously
found it necessary to undertake; were to interrupt him in conduct of
established enterprise would cause much greater inconvenience to
him since he would have to start again to establish it after
succeeding in trial.
12. In light of above principles of law, it was contended that
there was no proper consideration of balance of convenience and
irreparable loss and injury.
(2006) 1 SCC 540
(1975) 1 All ER 504
13. Relying upon decision of Hon'ble Supreme Court in case
of Colgate Palmolive (India) Ltd., v/s Hindustan Lever Ltd.,4
it was submitted that Hon'ble Supreme Court enumerated specific
considerations in matter of grant of interlocutory injunction as
follows:
"24. We, however, think it fit to note herein below certain specific considerations in the matter of grant of interlocutory injunction, the basic being non-expression of opinion as to the merits of the matter by the court, since the issue of grant of injunction, usually, is at the earliest possible stage so far as the time-frame is concerned. The other considerations which ought to weigh with the court hearing the application or petition for the grant of injunctions are as below:
(i) extent of damages being an adequate remedy;
(ii) protect the plaintiff's interest for violation of his rights though, however, having regard to the injury that may be suffered by the defendants by reason therefore;
(iii) the court while dealing with the matter ought not to ignore the factum of strength of one party's case being stronger than the other's;
(iv) no fixed rules or notions ought to be had in the matter of grant of injunction but on the facts and circumstances of each case -- the relief being kept flexible;
(v) the issue is to be looked at from the point of view as to whether on refusal of the injunction
(1999) 7 SCC 1
the plaintiff would suffer irreparable loss and injury keeping in view the strength of the parties' case;
(vi) balance of convenience or inconvenience ought to be considered as an important requirement even if there is a serious question or prima facie case in support of the grant;
(vii) whether the grant or refusal of injunction will adversely affect the interest of the general public which can or cannot be compensated otherwise."
14. It was submitted that no such exercise was done by trial
Court herein, therefore calling for interference.
15. It was submitted that this Court in case of Life
Insurance Corporation v/s Bangalore LIC Employees
Housing Cooperative Society Ltd.,5 had laid down guidelines for
consideration of application for interim injunction as follows:
"39. While, I do not wish to be drawn into this controversy, I would however like to rely on these facts i.e., the defendant being in a position to offer alternative land to the plaintiff and that even otherwise, the defendant having the means to compensate the plaintiff adequately in the event of the suit land not being available for its use, in order to demonstrate that balance of convenience clearly lay in favour of refusing the injunction rather than of granting.
The suit no doubt is one for a permanent injunction, but then in the circumstances the relief to be eventually awarded can always be moulded is trite law. If the defendant is allowed to build and thus render the suit land
ILR 1988 KAR 2817,
unavailable for the plaintiff notwithstanding its success, a permanent injunction may not be granted but in lieu thereof there can always be a direction to compensate the plaintiff adequately as indicated above. The matter admitting of such simple resolution, it appears, to have nonetheless escaped the notice of the learned trial Judge all must at this stage go back to the decision of the House of Lords in American Cyanamid Company's case.
39. As already pointed out Lord Justice Diplock after declaring that there was no rule as was believed that the existence of a strong prima facie case was the basis for the grant of an interlocutory injunction, then went on to indicate as to what was the governing principle underlying a finding in regard to balance of convenience. Following is the enunciation made in that behalf:--
"17. As to that, the governing principle is that the Court should first consider whether if the plaintiff were to succeed at the trial in establishing his right to a permanent injunction he would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendants' continuing to do what was sought to be enjoined between the time of the application and the time of the trial. If damages in the measure recoverable at common law could be adequate remedy the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted, however, strong the plaintiff's claim appeared to be at that stage. If on the other hand, damages would not provide an adequate remedy for the plaintiff in the event of his succeeding at the trial, the Court should then consider whether, on the contrary hypothesis that the defendant were to succeed at the trial in establishing his right to do that which was sought to be enjoined, he would be adequately compensated under the plaintiff's undertaking as to damages for the loss he would have sustained by being prevented from doing so between the time of the application and the time of the trial. If damages in the measure
recoverable under such an undertaking would be an adequate remedy and the plaintiff would be in a financial position to pay them, there would be no reason upon this ground to refuse an interlocutory injunction.
18. It is where there is doubt as to the adequacy of the respective remedies in damages available to either party or to both, that the question of balance of convenience arises. It would be unwise to attempt even to list all the various matters which may need to be taken into con side action in deciding where the balance lies, let alone to suggest the relative weight to be attached to them. These will vary from case to case."
(Emphasis supplied)
Continuing on this His Lordship said:
"Save in the simplest cases the decision to grant or to refuse an interlocutory injunction will cause to whichever party is unsuccessful on the application some disadvantages which his ultimate success at the trial may show he ought to have been spared and the disadvantages may be such that the recovery of damages to which he would then be entitled either in the action or under the plaintiff's undertaking would not be sufficient to compensate him fully for all of them. The extent to which the disadvantages to each party would be incapable of being compensated in damages in the event of his succeeding at the trial is always a significant factor in assessing where the balance of convenience lies; and if the extent of the uncompensatable disadvantage to each party would not differ widely, it may not be improper to take into account in tipping the balance the relative strength of each party's case as revealed by the affidavit evidence adduced on the hearing of the application. This, however, should be done only where it is apparent upon the facts disclosed by evidence as to which there
is no credible dispute that the strength of one party's case is disproportionate to that of the other party. The Court is not justified in embarking upon anything resembling a trial of the action upon conflicting affidavits in order to evaluate the strength of either party's case."
(Emphasis supplied)
40. Balance of convenience is thus not something akin to a tradesman's scales to be manipulated adroitly but as indicated in the decision supra it is the resultant anticipation by the Court in an objective manner of the concomitant hardships experienced by the one vis-à-vis advantages secured by the other party subject to there being clear chances of mitigating in some manner the hardship endured pendente lite by one or the otherside and the prospect of being adequately compensated should preeminently be the primordial factor guiding exercise of discretion one way or the other.
41. The aforesaid principles when applied herein should lead to the conclusion that there was really no ground and not even an ostensible one for granting a temporary injunction restraining the Corporation from going ahead with its plans of exploiting its own property for the benefit of its customers. For the present it is enough to rely on the ground of balance of convenience alone, to vacate the temporary injunction although, as I have pointed out earlier on the question of estoppel the plaintiff's case being found to flounder, it is left without any serious case for pleading at the trial as things now stand. But then even on the basis that it had something substantial to commend to the Court at the trial, the balance of convenience is really against granting of the injunction and that would be the result arrived at once the basis of the yardstick that should have been applied by the Court below, the norms being as indicated supra viz., that for the injury or loss sustained by the plaintiff by the action of the defendant in appropriating the land for its own use, the plaintiff can be compensated adequately by the Corporation regards whose means to compensate the plaintiff, to its heart's content, there can never be any doubt at all. It therefore becomes evident that the balancing factor of convenience was clearly against granting the injunction.
42. In this context I am bound to note the hazardous result attendant on the grant of the injunction and call attention to the fact that each day the defendant's project gets delayed, it will add to the escalating costs of house construction which is sky-rocketing daily a factor which is so notorious, that no Court can avoid taking note of. Increased costs go to inflating the sale price ultimately to be paid by the policy holders for whom the houses are built and that would be so even on a break-even policy of no- loss no-profit system. If thus, the result of the injunction is to make the ultimate beneficiary groan under the weight of the underable cost of purchase price, but on the other hand the clearance of the defendants project would not make any dent in the plaintiff's fortune in the event of its success in the suit because the Corporation can always be ordered to make good the loss by placing alternative land at the disposal of the society or pay the value thereof so that the society can buy land of its own choice elsewhere in Bangalore City. Viewed from this angle, it becomes clear that the balance of convenience always lay in favour of refusing the injunction rather than in granting it. Having regard to my views as aforesaid, it becomes evident that the temporary injunction granted by the Court below is thoroughly unsustainable and has got to be vacated. As already pointed out, I am not inhibited in any manner in interfering with the order of the Court below, becausee the order is vitiated by adoption of the wrong perspective or approach and, therefore, it becomes the duty of the Court to interfere with such an order as pointed out by Shivashankar Bhat, J. in Mitravinda's case [1987 (2) KLJ
121.] which was a Writ Petition arising under Article 226 of the Constitution from a discretionary order refusing to grant stay and even in such a proceedings. His Lordship felt compelled to interfere because the Court below had adopted a wrong approach and to enable interference with the impugned order. His Lordship depended on the authority in American Cynamide's case as could be seen from para 12 thereof.
43. White the above does suffice for vacating the temporary injunction granted by the Court and in consequence to allow this appeal it seems to me that must
take this opportunity, for calling attention to a frequent omission to which our Court are always invariably suceptible to. Lord Justice Diplock in the course of the Judgment in Cynamid's case [ILR 1976 Kar 426.] referred to supra has pointed out to the salutary practice of the Courts in England making always as a rule an order granting an interlocutory application only on terms so that hardship to the defendant if any caused by the infliction of an interlocutory injunction can be mitigated to some extent in the event at the conclusion of the trial it is proved that the grant of the interlocutory injunction was unjustified.
44. I have in the course of this judgment earlier drawn attention to the observation of his Lordship emphasising the need to make an interlocutory injunction on terms so that, in case the making of the order turns out to be a misadventure the defendant can still be compensated for having suffered an undue restraint of his liberty or right to enjoy ones own property. Very pertinently attention to this common deficiency affecting orders of an interlocutory nature made by the Courts in this Country has been highlighted in the Editorial note accompanying the decision in American Cyanamid's case [ILR 1976 Kar 426.] as published in the Indian Law Reports Karnataka Edition. I must in this connection advert to the following observation of the learned editor:
"The principle underlying the necessity of protecting the interests of parties affected by the grant or denial, as the case may be by putting the opposite party on terms, is merely a concomitant of the true principles that emerge from these and other rulings. Despite the clear mandate the laxity of the manner in which this remedy is administered has invited criticism."
xxx xxx xxx xxx
The practice of requiring an undertaking as to damages upon grant of interlocutory injunction was that it aided the Court in doing that which was its great object, viz., abstaining from expressing any opinion upon the merits of the
case until the hearing, but protected the plaintiff against uncompensatable disadvantage.
(Emphasis supplied)
45. There can be no doubt that the above observations are well warranted, highlighting as they did, the sadly neglected part of the discipline regarding granting of interlocutory injunction. It is needless to add that any Court exercising jurisdiction in this behalf excludes this exercise at its own peril. The need to make an interlocutory injunction on terms has been again high-lighted very recently in England in Attorney General v. Wright [1987 (3) All. E.R. Ch. D. 579.] . In that decision it has been pointed out that even the Attorney General as a suitor on behalf of the crown was not exempt from the ken of this salutary principle viz., that the Court should protect the interest of the defendant whose liberty may turn-out to have been unjustly restricted, in the course of the judgment Their Lordships referred with approval to the observations of Lord Justice Diplock in Hoffmann La Roche's case [1974 (2) All. E.R. 1128.] in the following terms:
"As Lord Dipiock explained in the Hoffmann La Roche case(1974) 2 All ER 1128 at 1150, (1975) AC 295 at 361 the purpose of the cross undertaking is to avoid or mitigate the risk injustice to a defendant against whom a Court has granted an interlocutory injunction without full investigation of the facts or law. If it appears at the trial that the plaintiff was not entitled to relief, the cross-undertaking enables him to be compensated for loss which he has been caused by the existence of the injunction. The principle is therefore that Court should protect the interests of a defendant whose liberty may turn out to have been unjustly restricted."
(Emphasis supplied) The apparently well supported principle of making an interlocutory order subject to terms appears to have fallen into disuse in our Courts, I need hardly state that it is time that we emulate an extremely considerate and well conceived principle enunciated by Courts in England of
making an interlocutory injunction on terms so that the defendant, or even a plaintiff who suffers by the grant or refusal of an unjustified interlocutory injunction is not exposed to further bouts of litigation to seek re-compense for his travails and tribulations suffered at the hands of a freewheeling plaintiff indulging in a no-holds-barred venture. The Judgment under appeal, I must notice is no exception to the ordinary run of orders made on an interlocutory application without subjecting order to terms. While the defendant can undoubtedly compensate the plaintiff for causing any loss or injury sustained by its action, the same cannot be said of the plaintiff with equal fervour. After obtaining the injunction the litigation pends for years as can be expected and finally, the verdict is against the plaintiff, would result in the owner of the land being compelled not to exploit its own property and in this case to confer benefaction on its customers would be made to pay very dearly for any benefit a few years, hence the plaintiff admittedly not being in position to mitigate an obvious hardship will have only had the sadistic satisfaction of keeping at bay the defendant for nothing at all. The non- consideration of these facets was clearly a gross error for the correction of which I am bound to interfere, if not for any other reason."
16. It was submitted that while passing impugned order,
trial Court failed to apply such considerations. Reliance was also
placed on another Division Bench decision of this Court in M/s.
Patel Enterprises v/s M.P. Ahuja,6 it was submitted that
provisions of Order XLI Rule 27 of CPC, would be attracted to
appeals under Order XLIII of CPC.
ILR 1992 KAR 3772
17. Sri. D.R. Ravishankar, learned Senior Counsel
appearing for Sri. Chandrashekar K., advocate for defendant no.1
at outset, submitted that suit was filed alleging infringement of
intellectual property rights ('IPR' for short) resulting in loss of
business worth Crores of rupees, before Civil Court by notionally
valuing suit reliefs at Rs.1,000/- under Section 26(c) of Karnataka
Court Fees and Suit Valuation Act,(for short 'KCF and SV Act')
would not be maintainable. It was submitted that Section 134 of
Trade Marks Act ( for short 'TM Act'), mandated filing of suit before
District Court. Further, as per Section 6 of Commercial Courts Act(
for short 'CC Act), only 'Commercial Court' would have jurisdiction
to entertain suit falling within definition of 'commercial dispute'
defined under Section 2(1)(c) read with Section 2(1)(i), therefore,
jurisdiction of Civil Courts would be barred under Section 11 of CPC.
18. It was further submitted that in all IPR cases even
where value of suit relief was claimed to be less than Rs.3 lakhs,
suit would first have to be filed or made over to Commercial Court
for determination of 'specified value' under Section 12 and only
after such determination if it were found that suit was not a
commercial suit, it could be proceeded with by Civil Court.
19. It was submitted that High Court of Delhi, in Vishal
Pipes Ltd., Vs. Bhavya Pipe Industry7, referring to judgment
passed by this Court in Fine Footwear Pvt. Ltd., Vs. Sketchers
USA Inc. & Ors.8, had held that usually in all IPR case, valuation
ought to be Rs.3 lakhs and above and proper court fee paid on said
valuation. It was further held that all IPR matters should be first
instituted before District Court designated as Commercial Court
even where suit valuation was less than Rs.3 lakhs. Upon
examination of specified value, Commercial Court would pass
appropriate orders either directing plaintiff to amend plaint or pay
requisite court fee or to proceed with suit as non-commercial suit.
It was submitted that in present suit, assertions in paragraph no.26
would be indicative of fact that 'specified value' of subject matter of
suit was more than Rs.3,00,000/-. Therefore, impugned order
called for interference.
2022 SCC OnLine Del 1730,
(2019) 5 KLJ 358
20. Relying upon decision of Hon'ble Supreme Court in case
of Canara Bank v/s N.G. Subbaraya Setty,9 wherein it was held
that an erroneous decision as to jurisdiction of a Court cannot
clothe that Court with jurisdiction where it as none, it was
submitted that even though trial Court in instant case had passed
order on 03.09.2022 regarding maintainability of suit, same would
not bar such contention in appeal against other order passed in suit
and Hon'ble Supreme Court held that as a matter of public policy,
principles of res judicata would not apply to an erroneous decision.
Therefore, it was open for appellants to question order of injunction
on ground that impugned order was passed by Civil Court without
jurisdiction.
21. Learned Senior Counsel, drew attention of this Court to
cause title of plaint, though named plaintiff was M/s. Eaglesight
Media Private Limited represented by Chairman and Director,
Mr.Ashwin Mahendra, prosecuted by his father Mr.Mahendra B.,
under authorization, pleadings were virtually those of individual and
reference to plaintiff - Company was as third person. It was
(2018) 16 SCC 228
therefore submitted that entire pleadings were with reference to
individual authorisee, but relief sought was for company.
Alternatively as entire pleadings were in respect of authorized
person, same would be irrelevant insofar as plaintiff - Company.
Consequently, it has to be held that there was no material for grant
of injunction in favour of plaintiff - Company.
22. Referring to decision of Hon'ble Supreme Court in Seema
Arshad Zaheer and Ors. v/s Municipal Corporation of Greater
Mumbai & Ors.10, , wherein it was held that Appellate Court would
be justified in exercising jurisdiction and vacating temporary
injunction granted by trial Court without any material, which would
include not only cases where there was total dearth of material but
also to cases where there was no relevant material and also cases
where material taken as a whole was not reasonably capable of
supporting exercise of discretion.
23. It was further submitted that as per plaint averments,
plaintiff was aware of defendants having blocked plaintiff from
participating in affairs of plaintiff - Company as early as in year
(2006) 5 SCC 282
2016 and 2017 and that plaintiff was aware of formation of
defendants no.1 and 2 - Companies, which according to plaintiff
was with sole intention of diverting all business and funds of
plaintiff - Company. Even serious and severe allegations of fraud
etc., were alleged. Yet, suit for permanent injunction was filed only
on 24.01.2022. It was submitted that Judicial Committee of Privy
Council in The Lindsay Petroleum Company v/s Hurd and
Ors.11, held that delay and latches would defeat discretionary relief.
Therefore, plaintiff was not entitled for injunction on ground of
delay and latches.
24. It was submitted that plaintiff Company was
incorporated on 11.02.2015. However, entire pleadings and prayer
do not appear to be pertaining to company but to an individual. In
paragraph no.8, plaintiff states that he was neglected and was
projected as a defunct director of plaintiff - Company. It was
further stated in paragraph no.9 that date of ouster was on
20.10.2014 and on 23.12.2014 when defendant no.3 fraudulently
misrepresented and obtained written resignation of plaintiff.
1874 LR 5 PC 221
References to transactions in paragraph no.14 were not subject
matter of suit and in paragraphs no.19 and 20, it was stated that
defendant no.3 clandestinely formed another company with similar
name i.e. defendant no.1 to continue his illegal activities with two
Directors namely defendants no.3 and 4. Though defendant no.1
was incorporated on 09.03.2017, it was with sole intention of
diverting business and funds of plaintiff - Company. In paragraph
no.22, it was stated that defendant no.3 had taken complete
control of plaintiff - Company and defendant no.1 was misusing
logo, contents, channel name, visuals, documents, office and studio
premises, technical equipments and employees of plaintiff -
Company. Further, allegations in paragraph no.33, that in name of
defendant no.1 - dubious Company, had completely taken over
plaintiff - Company and was controlled only by defendant no.3, but
in names of present two Directors, who were his own employees.
Further allegations in paragraphs-36 to 39 were to effect that even
incorporation of defendant no.4 - company was with fraudulent and
that defendant no.3 would indicate admission about defendants
carrying business in their own name.
25. It was further submitted that neither in plaint nor in
application, plaintiff had mentioned schedule in respect of which
injunction was to operate and therefore, on this count also
impugned order called for interference. It was submitted that plaint
averments and allegations were virtually alleging passing off
without seeking any prayer in that regard. It was further contended
that in view of admitted position about existence of two legal
entities, which were claiming right in respect of same subject
matter, bare suit for injunction without seeking declaration would
not be tenable. Likewise, in view of admitted position that plaintiff
was not in possession and control over plaintiff - Company, suit for
bare injunction without seeking prayer for possession, would be
barred under Section 41(h) of Specific Relief Act, 1963.
26. It was also contended that in paragraph no.18 of
impugned order, trial Court had observed that plaintiff - Company
was inactive. Such being case, when plaintiff failed to establish
either prima facie case or balance of convenience and irreparable
loss and injury, grant of injunction was highly untenable and called
for interference.
27. It was submitted that as plaintiff had knowledge about
alleged illegal activities of defendant during year 2017, suit filed in
year 2022 was clearly barred by limitation prescribed in Article 68
of Limitation Act, 1963. To highlight same, it was submitted that
entire documents and account extracts produced by plaintiff were of
period prior to year 2016. It was also submitted that though
plaintiff claimed to be running TV channel, suit was filed without
even producing current licence or documents indicating upto date
compliances/permissions. Even plaint lacked such material
particulars. On above grounds, learned counsel sought for allowing
appeal and setting aside of impugned order.
28. On other hand, Sriyuths A.S.Ponnanna and
K.N.Phanindra, learned Senior Counsel appearing for
Sri.B.R.Deepak, advocate for respondent no.1 - plaintiff opposed
appeal and supported impugned order. At outset, it was contended
that scope of an appeal under Order XLIII of CPC, was extremely
limited to examine whether impugned order suffered from
perversity or untenability.
29. It was submitted that entire written statement of
defendants was that of general denial. There was no specific denial
of material assertions such as in paragraph no.32 of written
statement of defendant no.1, wherein it was stated that allegations
made by plaintiff in plaint paragraph no.36 were not within
knowledge of defendant no.1, would amount to admission as per
Order VIII Rules 3 to 5 of CPC.
30. Insofar as specific assertions by defendant no.1 in
paragraph no.49 of written statement that it learnt about status of
plaintiff's - Company being shown as inactive in RoC and therefore,
suit could not be filed by dead company, it was submitted that
observation of trial Court as well as contention of defendant no.1
was blown out of context. It was submitted that as per Sections
164(2) and 167 (1)(a) read with Section 164(2) of Companies Act,
if any director incurred disqualification under Section 164(2) in
respect of one company, then such director would be deemed to
have vacated from directorship in all other companies than one
which was in default. It was submitted that only in this context,
plaintiff - Company was endorsed as 'inactive'. It was submitted
that as per document no.2 produced by defendant no.2, plaintiff -
Company was shown as 'active (non-compliant)'.
31. It was submitted that while narrating facts, plaintiff had
stated about various illegal acts of defendants, which were sought
to be done in name of plaintiff. In suit, plaintiff sought to prevent
defendants from doing same in name of plaintiff by using its
resources and employees. Even assertion that plaintiff had nothing
to do with activities of defendants. It was submitted that plaint
averments in that regard therefore cannot be read or understood as
admission of defendants being in possession.
32. Insofar as present and imminent danger, it was
submitted that plaintiff had asserted about illegal activities of
defendants being carried on in name of plaintiff - Company. It was
further submitted that defendant no.3 in written statement had
pleaded that he had resigned from Directorship of plaintiff -
Company. Conduct of defendant no.3 in denying tendering
unconditional apology in CCC (Crl)no.1/2020, after admitting to be
owner of BTv News, (in paragraph no.39 of written statement) was
contrary to records. Same would clearly substantiate present and
imminent danger test. It was further submitted that documents
produced by defendant no.1 namely Annexure-R18 - Unconditional
apology, additional unconditional apology and memo filed by
defendant no.3 undertaking to follow guidelines would establish
conduct of defendant no.3 in making false assertions before Court.
It was further submitted that this Court in above mentioned
Contempt petition had made extensive references to contemptuous
acts of defendant no.3. Hence, grant of injunction by trial Court was
fully justified.
33. It was further submitted that though defendants no.1
and 2 claimed to have been registered prior to filing of suit and
claimed to be in business of running TV News Channel, they failed
to produce any material even to indicate that they had own
resources and wherewithal for same. It was submitted that as per
records produced, certificate of incorporation of defendant no.2 was
dated 16.06.2020. But finding of this Court in Contempt petition as
well as unconditional apology affidavit filed by defendant no.3
would establish that they were operating much prior to registration,
which apparently substantiated plaintiff's allegation that they were
using plaintiff's resources.
34. It was submitted that though in paragraph no.4 of
appeal, defendants sought to make out a case of grave urgency
based on various assertions, same were beyond pleadings before
trial Court.
35. It was submitted that while passing impugned order
trial Court considered grave circumstances asserted in plaint. In
paragraph no.12 of its order, it observed that defendants no.1 and
2 had remained totally silent about incorporation, but were harping
more on plaintiff - Company being inactive and Mr.Ashwin
Mahendra being disqualified from Directorship.
36. Insofar as contentions about suit being barred before
Civil Court on account of provisions of Commercial Courts Act,
mandating suits regarding intellectual property rights being filed
only before Commercial Courts, it was submitted that objections
regarding jurisdiction was examined by trial Court and specifically
rejected under its order dated 03.09.2022. In view of said order,
defendants were estopped from urging said contentions in this
appeal. Conduct of defendants would amount to acquiescence.
37. Insofar as contention regarding failure of plaintiff to add
schedule to application, it was submitted that Annexure-R7 in list of
documents produced by plaintiff contained list and particulars of all
moveable assets of plaintiff, which were being used by defendants.
It was submitted that said list contained sufficient material
particulars. Therefore, said contention was unjustified.
38. In support of submissions, learned Senior Counsel relied
upon following decisions:
Sl. No. Citation Proposition of Law
Wander Ltd. and Anr. v/s Antox Scope of interference with orders on
1.
India Pvt. Ltd. reported in 1990 applications for temporary
(Supp) SCC 727 injunction in appeal.
Mohd. Mehtab Khan & Ors. v/s Factors to be considered while
2.
Khushnuma Ibrahim Khan & Ors. granting temporary injunction and
reported in (2013) 9 SCC 231 scope of interference in appeal.
Neon Laboratories Ltd. v/s Scope for interference with orders
3.
Medical Technologies & Ors. Ltd. on temporary injunction limited to
reported in (2016) 2 SCC 672 perversity.
Om Prakash Agarwal v/s Vishan Estoppel against raising objection
4.
Dayal Rajpoot & Ors. reported in regarding jurisdiction, unless taken
(2019) 14 SCC 526 at earliest point.
Nusli Neville Wadia v/s Ivory Question of jurisdiction was mixed
5. Properties & Ors. reported in question of law and facts. Hence, an
(2020) 6 SCC 557 order passed without considering
jurisdiction would not be a nullity.
39. From above submissions, it is seen that defendant no.1
has filed appeal challenging order passed on I.A.no.1 alone,
defendant no.2 has however, challenged order passed on I.As.no.2
and 3 also. In both appeals, question of jurisdiction of Civil Court
have been urged apart from assailing impugned order on merits.
Hence, points that arise for consideration in this appeal are:
1. "Whether appellants establish that appeal against order passed on IAs no.2 and 3 filed under Section 151 of CPC would be maintainable?
2. Whether Appellants establish that impugned order would be a nullity having been passed by Civil Court without jurisdiction, in view of bar under Section 27(2) read with Section 134 of Trade Marks Act and Section 6 read with Section 12 and 2(1)(i) of CC Act?
3. Whether impugned order calls for interference on ground of having been passed without any material or being based on irrelevant material (pleadings)?
4. Whether there is proper consideration of all essential ingredients while granting temporary injunction by trial Court calling for interference in appeal?"
Re.Point no.1:
40. Admittedly, I.As.no.2 and 3 were filed under Section 151
of CPC and not under Order XXXIX Rule 1 and 2 or any other
provision against which an appeal would lie under Order XLIII.
Indeed, Hon'ble Supreme Court in case of Shyam Sel and Power
Ltd., (supra) has observed that there may be other orders than
enumerated in Order XLIII Rule 1, which may be appealable as they
determine rights of parties. Learned Senior Counsel for plaintiff
fairly submitted that reliefs sought in I.A.s no.2 and 3 were
ancillary to relief sought in I.A.no.1 and were not independent.
Therefore, testing of orders passed on I.A.s.no.2 and 3 would follow
result of Order on I.A.no.1.
Re. Point no.2:
41. To determine this point, reference to prayers sought for
in plaint would be essential, keeping in mind that valuation of suit
under Karnataka Court Fees and Suit Valuation Act (for short 'KCF
& SV' Act) is different than under Commercial Courts Act, (for short
'CC Act'). KCF & SV Act is a State enactment which provides for
valuation of suit for purposes of court fee as well as jurisdiction.
Insofar as relief of injunction, valuation would be notion, regardless
of value of property in relation to which injunction is sought.
42. But, Section 12 of CC Act provides for determination of
'specified value of subject matter of suit' by reference to relief
sought. Where relief claimed is a sum of money, Section 12 (1) (a)
CC Act provides that same shall be specified value.
Section 12(1)(b) and (c), however, mandates that where
relief claimed is in respect of movable or immovable property
respectively, market value of such movable or immovable property
is to be taken into account for determining specified value.
Section 12(1)(d) provides that where relief sought relates to
any other intangible right, market value of said right as assessed by
plaintiff is to be taken into account.
43. Admittedly, in instant case, there is no prayer for
claiming damages. Specific prayer sought by plaintiff is to restrain
defendants from misusing plaintiff's logo, contents, channel name,
visuals, documents, office and studio premises, technical
equipments, employees and other assets belonging to plaintiff -
Company. Said relief apart from being in relation to movable and
immovable properties, is also in relation to intangible right.
Therefore, determination of 'specified value' in instant case would
have to be as per Section 12(1)(b), (c) or (d) of CC Act.
44. Insofar as prayer (b) wherein plaintiff has sought
injunction against defendants from entering into contracts or
agreements with media and channel partners of plaintiff - Company
by misusing its name, value of said relief cannot be assessed at
present. Therefore, it will have to be considered under Section
12(1)(d) of CC Act and market value as assessed by plaintiff has to
be taken into account.
45. In case, such specified value is above Rs.3,00,000/-,
then both twin conditions for a dispute to be considered as
commercial dispute would stand complied and as per Section 6 of
CC Act, jurisdiction of Civil Court would be ousted. Suit would lie
only before Commercial Court.
46. But, in instant case, plaintiff has not given particulars of
movable and immovable properties, in relation to which suit is filed.
Though, particulars were claimed to be disclosed in list produced as
Annexure - R7, their market value is not mentioned. Therefore,
there cannot be adjudication regarding 'specified value' at present.
47. However, this Court in CRP.no.545/2022 disposed of on
13.12.2022, while deciding legality of order rejecting contention of
defendants regarding lack of jurisdiction of Civil Court, has issued
direction to plaintiff to assess specified value as per provisions of
CC Act and directed trial Court to take into account such
assessment for deciding whether suit would be maintainable before
Civil Court and to return it for re-presentation, in case, it was not.
Thus determination of specified value is not yet completed.
48. Without determination of specified value of subject
matter of suit as per Section 12 of CC Act, suit cannot be held to be
not maintainable by referring to quantum of loss pleaded to have
been suffered by plaintiff mentioned in paragraphs no.16 and 26 of
plaint, as same would be contrary to method of assessment
provided under Section 12 of CC Act. Therefore, answer to point
no.2 would be subject to determination of 'specified value' by Trial
Court as per directions issued in CRP no.545/2022.
49. It would be relevant to note that Entry no.95 in List - I of
Schedule - VII of Constitution of India empowers Union legislature
to vest jurisdiction in any Court in respect of any of subject matters
in Union list and Entry no.49 is in respect of Patents, inventions and
designs; copy right; trade marks and merchandise marks, which
would cover subject matter of this suit. Therefore, Union legislature
would be competent to vest jurisdiction with regard to any of
subjects in said list, with any Court. Consequently, provisions of
T.M. Act, would have to give way to provisions of CC. Act insofar as
jurisdiction.
Re. Point no.3:
50. There is no dispute about fact that plaintiff in instant suit
is Company. However, in certain portions of pleadings, assertions
appear more in relation to representative of plaintiff-company than
Company. But, relief sought is for and on behalf of company.
Insofar as relief of injunction, necessary facts would be about
incorporation of plaintiff-company, its business and manner of
interference by defendant and balance of convenience etc. In para
no.5 of plaint, there is clear assertion regarding incorporation of
plaintiff-company.
51. There are also assertions about manner of interference
with plaintiff's business by defendants, viz., by clandestinely
forming another Company i.e., defendant no.1 with very similar and
identical name as that of plaintiff-company. There are also clear
allegations about intention of incorporation of such Company with
view to divert all business and funds of plaintiff Company to it.
There are further averments about interference by defendant no.3
leading to filing of police complaint and private complaint. Plaintiff
has also alleged that defendant no.3 was misusing logo, contents,
channel name, visuals, documents, office and studio premises,
technical equipments, same employees and all other assets
belonging to plaintiff company in name of defendant no.1-company,
to blackmail and other criminal activities. Plaintiff has also stated
about criminal cases registered against defendant and also his
unconditional apology affidavit filed before this Court in CCC (Crl.)
no.1/2020 (suo moto). Said pleadings, with supporting documents
would substantiate prima facie case in favour of plaintiff. Incidental
narration of events relating to representative of plaintiff-company
would not either vitiate plaint averments or can be considered as
irrelevant material. Therefore, having due regard to law laid down
in Seema Arshad Zaheer & Ors. & Canara Bank, point no.3 is
answered in negative.
Re. Point no.4:
52. It is settled law that while granting injunction, trial Court
is required to give finding on following essential ingredients viz.,
prima facie case, balance of convenience and irreparable loss and
injury, keeping in mind well established factors for refusing
injunction such as, conduct of plaintiff, delay and laches, non-
exhaustion of alternative remedy etc.
53. It is contended that conduct of plaintiff in approaching
Court belatedly even after having knowledge of interference by
defendants disentitled plaintiff from getting temporary injunction. It
is also contended that as defendants were carrying on press and
media activity and nature of injunction sought would if granted,
prevent defendant from performing said function, trial Court was
required to consider additional factor such as present and
imminent danger, adverse effect of injunction on right of general
public for information and measures as were necessary for
maintenance of status quo.
54. Though certain plaint averments would give an indication
about ouster of representative of plaintiff-company from its
business much prior to filing of suit, plaint being presented by
Company, wherein cause of action referred to instances of illegal
activities of defendants referred to by this Court while passing
orders in CCC (Crl.) no.1/2020 and knowledge of usage of plaintiff's
logo, contents, channel name, visuals, documents, office and studio
premises, technical equipments, same employees and all other
assets belonging to plaintiff company by defendant no.3 in name of
defendant no.1 for his illegal activities, same would be sufficient to
substantiate present and imminent danger as well as adverse effect
on general public etc.
55. It cannot be lost sight of about damage that can be
caused by irregular and if not illegal operation of mass media
business especially as accountability would be totally absent. In
present case, plaintiff has stated about instance where its abuse
was taken note of by this Court in CCC (Crl.) no.1/2020, which is
noted by trial Court also. While passing impugned order, trial Court
has categorically observed that despite specific and unequivocal
assertion by plaintiff about defendant no.3 using men, material and
resources of plaintiff-company in name of defendant no.1 -
company for his illegal activities by incorporating dubious company
with deceptively similar name as that of plaintiff-company,
defendants failed to plead and place any material to substantiate
that they were having sufficient and legitimate means to conduct
business. Said circumstance would be relevant to gauge
seriousness of threat and would justify grant of injunction by trial
Court.
56. This Court as well as Hon'ble Supreme Court in
innumerable cases have clarified about scope of interference by
appellate Court in orders granting discretionary relief. It is settled
law that only in case of perversity or untenability, appellate Court
would be justified in interference. Keeping in mind law laid down by
Hon'ble Supreme Court in Wander Ltd. and Anr.; Mohd. Mehtab
Khan & Ors. and Neon Laboratories Ltd., cases (supra) etc.,
that appellate Court in exercise of jurisdiction under Order XLIII
cannot re-examine or re-appreciate entire material and its
jurisdiction would be limited to examining whether order impugned
suffered from perversity, I hold that none of grounds urged qualify
for interference. Point no.4 is answered in affirmative.
57. In view of answer to points no.3 and 4 being in favour of
plaintiff, point no.1 is answered as being unnecessary. Said findings
however, would not affect or come in way of determination of
jurisdiction by Civil Court as observed while answering point no.2.
58. In result, following:
ORDER
i. Appeals are dismissed, however impugned order dated 05.09.2022 passed by XVIII Additional City Civil Judge, Bengaluru City in O.S.no.584/2022 on I.As.no.1 to 3 would be subject to ruling of trial Court on its jurisdiction as per observations above.
ii. All contentions of both parties are kept open to be urged before trial Court at time of determination of jurisdiction.
iii. Plaintiff is directed to plead regarding specified value of suit, within 15 days from today. Trial Court is directed to determine whether same would be below threshold limit specified in CC Act and consequently decide on its jurisdiction to entertain suit, as expeditiously as possible, after providing opportunity to defendants also, but not later than 30 days.
iv. In case, suit is held not maintainable,
interim injunction would stand
vacated with liberty to plaintiff to seek
said relief before Commercial Court.
Sd/-
JUDGE
Psg*/GRD
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