IN THE HIGH COURT OF JUDICATURE AT BOMBAY
R.I. CHAGLA, J.
Mangalam Organics Ltd. – Plaintiff
Versus
Patanjali Ayurved Ltd. and Others – Defendants
Interim Application (L) No. 4586 of 2024, Interim Application (L) No. 22226 of 2023, Commercial IPR Suit (L) No. 21853 of 2023
Decided On : 29-07-2024
Contempt - Interim Application - Order XXXIX Rule 2A, Section 151 - The court emphasized the willful disobedience of its orders, interpreting the provisions to uphold the authority of the court and ensure compliance with injunctions, leading to a significant financial penalty against the respondents.
Fact of the Case:
The plaintiff sought enforcement of an ex-parte ad-interim order against the defendants for violating an injunction related to trade dress and packaging, alleging continued sales despite knowledge of the order.
Finding of the Court:
The court found that the defendants willfully disobeyed the injunction order, continuing to manufacture and sell the impugned products even after being aware of the order, demonstrating contempt for the court's authority.
Issues: Whether the defendants' actions constituted willful disobedience of the court's injunction order and what penalties should be imposed for such contempt.
Ratio Decidendi: The court held that willful disobedience of its orders warrants serious consequences, emphasizing that past violations must be addressed even if compliance is achieved later.
Result: The respondents are ordered to pay Rs. 4,00,00,000 to the plaintiff for contempt of court.
ORDER :
1. By this Interim Application, which has been filed under Order XXXIX Rule 2A of the Code of Civil Procedure, 1908 (for short “CPC”) read with Section 151 of the CPC, the Applicant/Plaintiff has sought direction against the Defendants/Respondents to comply with the ex-parte ad-interim order dated 30th August 2023 and discontinue non compliance thereof. Further, relief is sought to punish with simple imprisonment Respondent Nos.2 to 10 who are in charge of the day to day business affairs of the Defendant/Respondent No. 1 for violation and/or disobedience of the ex-parte ad-interim order dated 30th August 2023 and for contempt of Court. The relief of disclosure and striking off the entire defence of Respondent No. 1 in the present Suit are not being pressed.
2. This Court by the ex-parte ad-interim order dated 30th August 2023 passed in Interim Application (L) No. 2226 of 2023 filed in the present Suit had granted ad-interim relief in terms of prayer clauses (a) and (c) of the Interim Application in favour of the Applicant/Plaintiff by which the Defendants/Respondents were restrained from in any manner using the impugned cone shape trade dress and impugned carton packaging shown at Exh.-X1 or any other shape/trade dress/carton packaging which is identical and/or deceptively similar to the Plaintiff’s said cone shape trade dress and said artistic packaging shown at Exhibit I to the Plaint, so as to pass off the Defendants’ impugned product and for those of the Plaintiff or in any other manner whatsoever. Further relief was granted in terms of prayer (c) which was for appointment of the Court Receiver and directions issued to the Court Receiver to execute the commission.
3. On 27th and 28th September 2023, the Court Receiver through the Additional Special Receiver who was also appointed under the order dated 30th August 2023 executed the commission and during which the Respondent/Defendant No. 1 was served with the copy of the said order and also copies of the pleadings filed in the above Suit. The Additional Special Receiver had prepared the Site Reports and the Defendant/Respondent No. 1 became fully aware of the ex-parte ad-interim order dated 30th August 2023.
4. The Defendant/Respondent No. 1 filed Interim Application (L) No. 33220 of 2023 on 29th November 2023 under Order XXXIX Rule 4 of the CPC inter alia seeking to vacate the said ex-parte ad-interim order.
5. The Applicant/Plaintiff has stated that inspite of being aware of the ex-parte ad-interim order dated 30th August 2023, on 28th September 2023, the Defendant/Respondent No. 1 in flagrant violation of the said Order continued to manufacture, market, advertise and sell the impugned Camphor product bearing the impugned cone shape trade dress and impugned carton packaging and thereby committing willful disobedience and contumacious breach of the said order dated 30th August 2023 passed by this Court.
6. The Applicant/Plaintiff has stated that the impugned goods continued to be sold on www.amazon.in website. An order was placed by the Applicant/Plaintiff on 1st February 2024 and the impugned goods were received on 6th February 2024. Invoice in respect of the impugned goods was issued by “S.S. Enterprises” and “packed on” date printed showed “September 2023.”
7. The Applicant/Plaintiff has further stated that on 2nd February 2024, the field representative of the Applicant came across the impugned product bearing impugned cone shape trade dress and the impugned carton packaging being sold at “Patanjali Mega Store” at Virar. As per the Applicant’s directions, the representative caused to conduct a trap purchase of the impugned product and a purchase invoice dated 2nd February 2024 was issued. Upon a closer up look at the impugned product purchased on 2nd February 2024, the Applicant was shocked and surprised to learn that the ‘packed on’ date printed thereon was ‘DECEMBER 2023 i.e. almost two months after being served with a copy of the said order dated 30th August 2023.
8.
Willful disobedience of court orders, even if later complied with, can lead to significant penalties to uphold the authority of the court.
Power to order civil imprisonment under Order XXXIX Rule 2A curtails an individual's fundamental right, albeit through a process of law.
The court established that third parties can be held liable for contempt if they knowingly assist in violating court orders, reinforcing the court's authority to enforce compliance.
Scope of execution proceedings are irrelevant for contempt jurisdiction of High Court.
Interim orders cease upon the issuance of final judgments, impacting the enforceability of prior mandates.
Breach of injunction – Instead of being directly sent to civil prison, respondents can be directed to pay compensation.
The court emphasized that evidence is required to establish breach of injunction orders, and punitive measures must be proportionate to the nature of disobedience.
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