Courts will refuse to enforce an illegal agreement at the instance of a person who is himself a party to an illegality or fraud.

RAJIV SAHAI ENDLAW, J.

1. The plaintiff has approached the court with a case that; (i) It is engaged inter-alia in the business of manufacturing and marketing Audio & Video, CDs & DVDs;

(ii) That M/s Magnasound (India) Ltd., (hereinafter called Magnasound) was also engaged in the same trade and owned copyright of various Audio & Video Albums;

(iii) Magnasound was being managed by Mr. Shashi Gopal, his wife Ms. Kalpana Gopal and Mr. Madhav Dass being the husband of Ms. Sudha Dass sister of Mr. Shashi Gopal;

(iv) That Magnasound was facing financial crises and owed monies to several creditors, one of which filed a petition in the High Court of Bombay for winding up of Magnasound;

(v) That the aforesaid persons in management of Magnasound, on the verge of their removal and appointment of the provisional liquidator wanted to transfer the copyright of Music Videos, owned by Magnasound and which was a valuable asset of Magnasound;

(vi) They in furtherance of their misdeeds, involved the defendant No.1 in their conspiracy and manipulated a sham, bogus and back dated agreement dated 20th September, 2002 of transfer of copyright of Magnasound of the Albums, to the defendant No.1 and to the detriment of Magnasound.

(vii) However, since Mr. Shashi Gopal aforesaid could not trust the defendant No.1, he also got an agreement dated 25th October, 2003 of transfer of the rights under the agreement dated 20th September, 2002 by the defendant No.1 in favour of the defendant No.3 being a proprietary concern of Mrs. Sudha Dass aforesaid;

(viii) This was done because Magnasound could not directly transfer the rights to the defendant No.3 owing to the relationship;

(ix) That the transfer of copyright in favour of the defendant No.1 and then to the defendant No.3 is a clear case of fraud, cheating, misrepresentation and conspiracy.

(x) That Mr. Sashi Gopal however did not trust his sister also and obtained a power of attorney from her regarding the rights so created in favour of defendant No.3; He acting under the said power of attorney approached the plaintiff for assignment of rights which were originally vested with Magnasound to the plaintiff;

(xi) That since Mr. Shashi Gopal was incharge and controlling authority of Magnasound, the plaintiff did not doubt the transfer of rights by Shri Shashi Gopal to the plaintiff even though through such circuitous agreements;

(xii) That the plaintiff purchased the copyright for consideration of Rs.2 lac paid to the defendant No.3.

(xiii) That accordingly an agreement dated 17th June, 2004 with respect to the said copyright was executed in favour of the plaintiff.

2. The case of the plaintiff is that even though the agreement dated 20th September, 2002 which had been executed in favour of the defendant No.1 was fraudulent as aforesaid and even though the defendant No.1 had transferred the rights acqired under the said agreement in favour of the defendant No.3 vide agreement dated 25th October, 2003 but the defendant No.1 on the basis of the agreement dated 20th September, 2002 was interfering with the exercise of rights under the agreement dated 17th June, 2004 by the plaintiff. The plaintiff thus claimed the relief of permanent injunction restraining the defendant No.1 from interfering with the exercise of copyrights vested in favour of the plaintiff under the agreement dated 17th June, 2004 and for restraining the defendant No.1 from infringing the said copyright. The defendant No.2 is one of the stockist of the plaintiff to whom threats are alleged to have been meted out by the defendant No.1. The necessary reliefs of mandatory injunction, accounts, delivery, and damages have also been claimed. On 5th November, 2008 when this suit was listed before the court, the plaintiff informed the court that the defendant No.1 had instituted CS (OS) No.1187/2005 in this court against some parties, in relation to the copyrights aforesaid. On that date the statement of the representative of the plaintiff was also