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2019 Supreme(Cal) 801
IN THE HIGH COURT OF JUDICATURE AT CALCUTTA
ARIJIT BANERJEE, J.
Sharma Ayurved Private Limited – Plaintiff
Versus
B.N. Sharma Ayurved Private Limited – Defendant
G.A. No. 772 of 2013, C.S. No. 62 of 2007
Decided On : 19-11-2019
Advocate Appeared:
For the Plaintiffs : P.C. Sen, Arup Nath Bhattacharya, Anirban Ray, Sreetama Biswas.
For the Defendants : Ratnanko Banerjee, Lapita Banerjee, Patita Paban Biswas, Kuldip Mallik, Sristi Barman Roy.
The main legal point established in the judgment is that the rights and liabilities of the parties in relation to the business were decided by a competent tribunal, and the plaintiff's lack of transparency in disclosing material facts affected the court's decision.
Headnote:
Copyright Infringement - Ownership of Business - Copyright Act, 1957, Sections 51, 55 - The court held that the defendant was entitled to use the name BANPHOOL on its label and carton for marketing the hair oil, as the business and assets of the plaintiff company were divided between two groups of the Sharma family by the CLB order, and the defendant was permitted to carry on the same family business through a newly floated private limited company at the Delhi and Baddi units. The court found that the rights and liabilities of the two groups in relation to the business were decided by a competent tribunal and such decision was not assailed before a higher forum. The court also noted that the plaintiff was less than candid in its approach to the court by not disclosing the similarity of prayers in a previous application before the CLB.
Fact of the Case:
The plaintiff filed a suit for copyright infringement of the artistic work BANPHOOL (Label) and BANPHOOL OIL (Carton) against the defendant, seeking an injunction to restrain the defendant from using the said label and carton for manufacturing and selling hair oil. The plaintiff claimed ownership of the copyright in the artistic work on the label and carton, which was registered in the name of the partnership firm M/s Sharma Chemical Works and later vested in the plaintiff company.
Finding of the Court:
The court found that the defendant was entitled to use the name BANPHOOL on its label and carton for marketing the hair oil, as the business and assets of the plaintiff company were divided between two groups of the Sharma family by the CLB order, and the defendant was permitted to carry on the same family business through a newly floated private limited company at the Delhi and Baddi units.
Issues: The main issue was whether the defendant was entitled to use the name BANPHOOL on its label and carton for marketing the hair oil, and whether the plaintiff was entitled to an injunction to restrain the defendant from committing copyright infringement.
Ratio Decidendi: The court held that the rights and liabilities of the two groups in relation to the business were decided by a competent tribunal and such decision was not assailed before a higher forum. The court also noted that the plaintiff was less than candid in its approach to the court by not disclosing the similarity of prayers in a previous application before the CLB.
Final Decision: The application for injunction filed by the plaintiff was dismissed, and the defendant was found entitled to use the name BANPHOOL on its label and carton for marketing the hair oil. The court also noted that there would be no order as to costs.
JUDGMENT :
ARIJIT BANERJEE, J.
1. In this suit filed for alleged infringement of copyright in the artistic work BANPHOOL (Label) and the artistic work BANPHOOL OIL (Carton), the plaintiff has filed this interlocutory application essentially praying for an order of injunction to restrain the defendant from producing or selling or marketing any product using the said label and carton as portrayed in Annexures-K and L to the petition. The short contention of the plaintiff/petitioner is that it is the owner of the copyright in the artistic work on the said label and carton. It has not permitted the defendant to use the said label and carton for carrying on the defendant's business of manufacture and sale of hair oil. By manufacturing and marketing/selling its hair oil using the said label and carton, the defendant is infringing the plaintiff's copyright in the said label and carton.
2. The undisputed facts of the case are that, at all material times, the Sharma Brothers carried on the family business of manufacture and sale of Ayurvedic hair oil under the name of BANPHOOL. This business was carried on in co-partnership, pursuant to a partnership deed executed in 1982 by and between the Sharma Brothers. The name of the partnership was M/s Sharma Chemical Works. The copyright in respect of the artistic work on the said label and carton was registered in the name of the partnership firm. The registration number for the label was A42227/83 and that for the carton was A41272/83. In the registration certificate, in respect of the label, the name of the author of the artistic work BANPHOOL was shown as Shri Biswanath Sharma, partner of Sharma Chemical Works. The registration certificate in respect of the carton showed the name of the author of the artistic work as Shri Kanakendu Tosh.
3. In the year 1999 the members of the Sharma family viz. Biswanath Sharma (Biswanath), Sheo Shankar Sharma (Sheo Shankar), Prabhu Nath Sharma (Prabhu Nath), Om Nath Sharma (Om Nath), Mrs. Saraswati Sharma (Saraswati), Mrs. Sova Sharma (Sova) and Saroj Kumar Sharma (Saroj) incorporated a Private Limited company by the name of Sharma Ayurved Private Limited which is the plaintiff herein. The certificate of incorporation under the Companies Act, 1956, was issued by the Registrar of Companies, West Bengal on 09 August, 1999. The main object with which the said company was incorporated, as stated in the objects clause of its Memorandum of Association, was “to become vested with rights to continue the partnership business now being carried on under the name and style of Sharma Chemical Works including all its assets, rights, interests, benefits, titles, approvals, registrations, permits, facilities, concessions, sanctions, privileges, licences, deeds, liabilities of the parties hereto in the partnership business and in connection therewith.”
Upon incorporation of the said company, the family business of manufacture and sale of Banphool Hair Oil was continued through the instrumentality of the said company of which the promoters and share-holders were the members of the Sharma family.
4. Disputes and differences arose between two factions of the Sharma family regarding the business of the said company. One set of share-holders of the company viz. Saraswati and Others filed Company Petition No. 49 of 2008 before the Company Law Board (CLB), Kolkata Branch against the company and the other shareholders being Biswanath and Others, under Sections 397/398 of the Companies Act, 1956 alleging mismanagement and oppression. Since this was a derivative action, the company was made a party respondent. The said proceeding was disposed of by the CLB by an order dated 14th September, 2011. This order is of vital importance. The directions contained in the said order insofar as the same are relevant for the purpose of the present proceeding, are, inter-alia, to the following effect:
(i) The petitioners' group (Saraswati Group) would get the Kolkata unit of the company (plaintiff herei
