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146 (2008) DELHI LAW TIMES 657
DELHI HIGH COURT
Reva Khetrapal, J.
KENSOFT INFOTECH LTD. – Plaintiff
versus
R.S. KRISHNASWAMI & ORS. – Defendants
CS (OS) No. 1493 of 2006
Decided on : 8.1.2007
KENSOFT SYSTEM - COPYRIGHT INFRINGEMENT - JURISDICTION - [SECTION 20(C) OF CPC] - SUIT FILED BY PLAINTIFF FOR PERMANENT INJUNCTION, RESTRAINING INFRINGEMENT OF COPYRIGHT, BREACH OF CONFIDENCE, DAMAGES AND RENDITION OF ACCOUNTS OF PROFITS - DEFENDANT FILED APPLICATION UNDER ORDER 39 RULE 4, CPC FOR VACATION OF STAY ORDER - COURT HELD THAT THE LOCATION OF SUBORDINATE OFFICE OF ONE OF DEFENDANTS, PER SE WILL NOT VEST JURISDICTION IN COURTS ALL OVER INDIA, PARTICULARLY IN THE ABSENCE OF ANY SPECIFIC AVERMENT MADE BY THE PLAINTIFF RELATING TO ANY ACT OF INFRINGING THE RIGHTS OF THE PLAINTIFF - COURT HELD THAT THE ATTEMPT OF THE PLAINTIFF TO INVOKE THE JURISDICTION OF THIS COURT . APPARENTLY IS A DELIBERATE ATTEMPT TO INVOKE THE JURISDICTION OF THE COURT WHERE NONE IS VESTED IN THE COURT, AND THAT TOO IN A CASE WHERE THE PROVISIONS OF SECTION 62 OF THE COPYRIGHT ACT PROVIDE AN ADDITIONAL FORUM TO THE PLAINTIFF AT MUMBAI - COURT HELD THAT THE PLAINT OF THE PLAINTIFF IS ORDERED TO BE RETURNED FOR PRESENTATION BEFORE THE COURT OF COMPETENT JURISDICTION.
Fact of the Case:
Plaintiff, a software company, filed a suit for permanent injunction, restraining infringement of copyright, breach of confidence, damages and rendition of accounts of profits. Defendant filed an application under Order 39 Rule 4, CPC for vacation of stay order. Plaintiff sought time for filing a reply and was directed to do so before the next date. In the meanwhile, a Special Leave Petition was filed before the Hon'ble Supreme. The Supreme Court directed the parties to argue the injunction application before the High Court.
Finding of the Court:
Court held that the location of subordinate office of one of defendants, per se will not vest jurisdiction in Courts all over India, particularly in the absence of any specific averment made by the plaintiff relating to any act of infringing the rights of the plaintiff. Court held that the attempt of the plaintiff to invoke the jurisdiction of this Court . apparently is a deliberate attempt to invoke the jurisdiction of the Court where none is vested in the Court, and that too in a case where the provisions of Section 62 of the Copyright Act provide an additional forum to the plaintiff at Mumbai. Court held that the plaint of the plaintiff is ordered to be returned for presentation before the Court of competent jurisdiction.
Issues: Whether the Court has territorial jurisdiction to entertain the present suit.
Ratio Decidendi: The Court held that the location of subordinate office of one of defendants, per se will not vest jurisdiction in Courts all over India, particularly in the absence of any specific averment made by the plaintiff relating to any act of infringing the rights of the plaintiff. The Court held that the attempt of the plaintiff to invoke the jurisdiction of this Court . apparently is a deliberate attempt to invoke the jurisdiction of the Court where none is vested in the Court, and that too in a case where the provisions of Section 62 of the Copyright Act provide an additional forum to the plaintiff at Mumbai.
Final Decision: The Court held that the plaint of the plaintiff is ordered to be returned for presentation before the Court of competent jurisdiction.
Reva Khetrapal, I.-The present suit is filed by the plaintiff for permanent injunction, restraining infringement of copyright, breach of confidence, damages and rendition of accounts of profits.
2. The plaintiff is a software company engaged in the business of developing application software having its registered office at Mumbai.
The plaintiff alleges that the defendants have infringed the flagship product of the plaintiff "KEN-HFS" (hereinafter referred to as "Kensoft system") which is a housing finance software for use by companies engaged in the said business. The said niche Kensoft System was originally developed by the plaintiff in the year 1994 and was initially installed with the Bank of India in the year 1994 itself. Subsequently, in the year 1996, it was installed at the premises of defendant No.3. Allegedly, the plaintiffs software has many unique features and the plaintiff being the first owner of the copy right in the aforesaid literary work within the meaning of Section 17 of the Copyright Act, 1957 is entitled to the exclusive rights flowing from such ownership.
3. The defendant No.1 is a Director of the defendant No.2, i.e., office at Phoenix Softnet Technologies Pvt. Ltd., having its registered office at Mumbai. Defendant No.3 is the GIC-Housing Finance Ltd., Universal Insurance Building, Sir P.M. Road, Fort, Mumbai.
4. The fulcrum of the case of the plaintiff is that the defendant Nos. 1 and 2 in conjunction with defendant No.3 have hacked and infringed the copyright of the plaintiff in its Kensoft System by unlawfully reproducing the said System without the plaintiffs consent, permission or licence and offered the said software for sale under the name "Home Loans Express", The plaintiff alleges that this was brought to the notice of the plaintiff by one of its clients i.e. M/s. Sundaram Finance and while the plaintiffs investigations were ongoing, the plaintiff received an e-mail from one M/s. Shirdi Industries Pvt. Ltd., wherefrom to the utter shock of the plaintiff, it discovered that defendant No.3 had written to M/s. Shirdi Industries Pvt. Ltd. and claimed to have developed the said "Housing Loans Express".
5. On the above facts, by order dated 28th July, 2006, an ex parte ad interim injunction was granted by this Court to the plaintiff restraining the defendants from using or otherwise copying, selling, offering for sale or distributing the infringing version of the plaintiffs software. In order to ascertain the correct factual position, this Court also appointed two Local Commissioners to visit the defendants premises to inspect the computers of the defendant Nos. 2 and 3 with the help of an independent technical expert and to take print outs of the source code and backups of all the hard discs containing the infringing software.
6. The aforesaid ex parte interim order led to the filing of an appeal being FAO(OS) No. 505/2006, which was dismissed as withdrawn on 7.8.2006, as the same had been filed without moving an application under Order 39 Rule 4, Code of Civil Procedure for vacation of the stay order. A second appeal, being FAO(OS) No. 524/2006, was also dismissed as withdrawn with liberty to the appellant to raise the issues raised in the appeal before the Single Judge on 21.8.2006. On 8.9.2006, when the matter came up for hearing before this Court, however, it was agreed between the parties that an expert comparison would be required for coming to a conclusion as to whether the software of the plaintiff i.e. "KEN-HFS" was identical/ similar with the software of the defendant No. 1. Thereupon, a consent order was passed, whereby and whereunder Mr. Narain Murthy of Infosys was requested to undertake the comparative evaluation of the two softwares and record his conclusions thereon. The said order dated 8th September, 2006 reads as follows:
"8.9.2006:
IA Nos. 8306/2006,9153/2006 and 9497/2006:
It is agreed between the parties that an expert comparison would be required for coming to a conclusion as t
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