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2012 Supreme(Del) 2015

IN THE HIGH COURT OF DELHI AT NEW DELHI
V.K.JAIN, J.
OIL AND NATURAL GAS CORPORATION LTD - Plaintiff
versus
“MARYADA”, THE WEEKLY NEWS MAGAZINE & ORS - Defendants
CS(OS) 1576/2008 and IA No. 9457/2008 (O. 39 R. 1&2 CPC)
Decided On : 17.10.2012

Advocates:
Advocate Appeared:
Mr Somiran Sharma, Adv.
None.

Headnote:

Defamation - Corporation's Right to Sue - Winfield on Tort - Salmond on Law of Torts - Naung Chit v. Maung Tun AIR 1935 Rangoon 108 - Indian Express Newspapers (Bom.) Pvt. Ltd. V. Jagmohan, AIR 1985 Bom 229 - Wall Street Journal Europe Sprl v. Jameel and Ors. (2006) UKHL 44 - Derbyshire County Council v. Times Newspapers Ltd. and Ors. (1993) AC 534 - Shendish Manor Limited v. Coleman (2001) EWCA Civ 913 - Bognor Regis Urban District Council v. Campion (1972) 2 Q.B. 169

Fact of the Case:

The plaintiff, a Government of India Undertaking, sued for defamation and damages against the defendants who published articles alleging corruption in the plaintiff's project. The plaintiff claimed that the articles had damaged its reputation and caused harm to its officers.

Finding of the Court:

The court found that the allegations in the articles and letters were defamatory to the officers named but not to the plaintiff as a corporation. It held that the defamation of the officers did not amount to defamation of the corporation itself, and therefore, the plaintiff had no legal right to seek damages from the defendants.

Issues: 1. Whether a corporation can sue for damages on account of defamation. 2. Whether the articles and letters published by the defendants were defamatory to the plaintiff company.

Ratio Decidendi: The court relied on legal principles from Winfield on Tort, Salmond on Law of Torts, and various case laws to establish that a corporation can sue for defamation only when the defamatory statement is calculated to injure the reputation and business interests of the corporation itself, and not just its officers. It concluded that the defamation of the officers did not amount to defamation of the corporation, and therefore, the plaintiff had no legal right to seek damages from the defendants.

Final Decision: The suit was dismissed as the court found that the articles and letters published by the defendants were defamatory to the officers named but not to the plaintiff as a corporation, and thus the plaintiff had no legal right to seek damages from the defendants.

JUDGMENT

V.K.JAIN, J.

1. This is a suit for injunction and recovery of Rs 10 crores as damages. The plaintiff is a Government of India Undertaking and is stated to be a Fortune 500 Company, engaged in exploration and production of Natural gas and oil in the country. The plaintiff claims to be a well-known and respected major oil and gas producer, having financial arrangements with international bankers and financiers. Defendant No.2 publishes a magazine, namely, Maryada, from Uran in District Raigad of Maharashtra. Defendant No. 3 claims to be a social worker, whereas defendant No. 4 prints the magazine „Maryada’. Defendant No. 3 wrote certain articles in various issues of Maryada, alleging corruption in the project of ONGC at Uran. It was alleged that Hemant Chavan and Haridas Mhatre (defendants 2 and 3 respectively) had exposed corruption of crores of rupees in the aforesaid project, whereupon Mr P.K. Borthakur, working director of ONGC, contractors and other officers of ONGC got angry and threatened them, stating they would burn the office of Maryada by sending their Gundas. It was further alleged that they had made a plot against defendant No. 3, by filing fake false complaints against him. It was also alleged that there had been theft of crores of rupees in the aforesaid project of Uran and Government of India was being cheated by allotting illegal contracts. It was also alleged that there was only one contractor at Uran plant, namely, Global S.S. Contraction, which was sending bills of Rs 5 crore and those bills were getting cleared quickly. It was further alleged that the plant-in-charge P.K. Borthakur had given special order that no one other than Parveen Sharma, whose father was an engineer in the ONGC, should be given contracts. It was also alleged that the previous In-charge of ONGC at Uran had also indulged in corrupt practices by allotting maintenance contract to S.S. Construction and Borthakur, Sultania, Mujumdar of Contract Cell, Contract Department and Tender Department of ONGC had contributed to corruption, by allotting contracts only to S.S. Construction, owned by Parveen Sharma. Yet another allegation made in the article was that the repair bill of the guest house was Rs 53 crore, which was a clear indication of loot of Government money by ONGC officers and that monthly bill of the guest house for lunch, dinner, breakfast, etc. came to about 4-5 lakh per month, all of which were fake and manipulated by the owner of S.S. Sibs Services and P.K. Borthakur was a participant in the corruption. It was also alleged that the contractors were fleecing ONGC of Rs 300-400 crores per month, by using illegal means.

2. In another article, it was alleged that defendant No. 3 had accused ONGC officers of conspiring steel scrap worth of Rs 4 crores and 13 lakh from ONGC plant at Uran on 05.03.2008. It was further alleged that this conspiracy was hatched by P.K. Borthakur (working director and Head Plant In-charge), D.D. Mishra (Deputy General Manager), P.K. Sultania (Deputy General Manager), V.V. Shah (Manager) and three truck of scrap going out of the plant were saved by timely action taken by defendant No. 3, who telephoned CBI and ONGC headquarters in this regard. It was also alleged that the people who had submitted the tenders were close relatives of P.K. Borthakur and the tenderers had conspired to fix the rate of scrap at Rs 21 per kg while the market rate was Rs 47 per kg. It was further alleged that Borthakur was helping the tenderer in getting the scrap had much lower rate and had also attempted lifting the scrap without weighing, besides instructing the tenderer to lift four ton extra scrap per truck. It was also alleged that scrap weighting 680 ton was being lifted officially at the rate of Rs 21 per kg while scrap weighing 240 ton was being diverted illegally and was not being accounted. It was further alleged that there was corruption of crores of rupees on daily basis in ONGC at Uran.

3. Defendant No. 2, Shri

































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