Judgment

Rajiv Sahai Endlaw, J.

1. IA No. 1196/2017 and IA No. 1197/2017 (of the defendants no.1 to 3 under Order 7, Rule 10 and Order 7, Rule 11 of the Code of Civil Procedure, 1908 (CPC) respectively).

These applications have come up today for the first time. The counsel for the plaintiff appears on advance notice.

2. Considering the nature of the applications, which have to be decided on the basis of the contents of the plaint and the documents of the plaintiff, need to call for reply is not felt. Be that as it may, before commencing arguments, it has been so enquired from the counsel for the plaintiff and the counsel for the plaintiff also agrees.

3. The counsel for the applicants/defendants seeks return/rejection of the plaint on the ground of this Court not having territorial jurisdiction to entertain the suit.

4. Though in the application under Order 7, Rule 10 of CPC, a ground of this Court not having pecuniary jurisdiction also has been taken, pleading inconsistency between Delhi High Court Act, 1966 as amended by Delhi High Court (Amendment) Act, 2015 and the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 and contending that the minimum pecuniary jurisdiction of this Court having been raised to above Rs.2,00,00,000/-, this Court cannot have jurisdiction to try a commercial suit the valuation whereof is Rs.1,00,00,000/- and above but the counsel for the applicants/defendants agrees that the said plea is to be adjudged by the Division Bench and not by a Single Bench of this Court.

5. Return/rejection of the plaint on the ground of lack of territorial jurisdiction is sought contending (i) that the territorial jurisdiction of this Court, in para 35 of the plaint has been invoked, referring to Section 134 of the Trade Marks Act, 1999 and not on the basis of any cause of action having accrued within the jurisdiction of the Court; (ii) that the plea of the plaintiff is also of allegedly infringing goods being sold outside Delhi; (iii) the plaintiff has expressly pleaded in para 35 of the plaint that the plaintiff does not have a branch/subordinate office in Gujarat where the defendants are located; (iv) however the plaintiff itself, at page 429 of its documents, in the document titled 'Corporate Information' has shown having a 'Regional Office' at Ahmedabad; (v) attention is also drawn to page 429 listing EVOK Stores, where under also mention is made of Gujarat Zodiac Square, S.G. Highway, Bodakd, Ahmedabad; (vi) the plaintiff has thus, in para 35 of the plaint falsely pleaded not having any branch/subordinate office in Gujarat where the defendants are located; (vii) that even otherwise, the plaintiff admittedly has its registered office at Kolkata; (viii) that the Division Bench of this Court in para 14 of Ultra Home Construction Pvt. Ltd. v. Purushottam Kumar Chaubey (2016) 227 DLT 320 has held that where the cause of action has accrued neither at the place of principal office nor at the place of subordinate office but at some other place, the plaintiff can be deemed to carry on business at the place of its principal office and not at the place of its subordinate office; and (ix) thus the plaintiff herein, even if has a subordinate office at Delhi, though the same is also disputed, cannot invoke Section 134 at Delhi and can at best invoke the same at Kolkata.

6. The counsel for the plaintiff has in response contended, (i) that though the plaintiff at page 429 supra has shown regional office at Ahmedabad but thereunder has not given any address and has given only a telephone number and an e-mail address which are just 'helpline numbers' and otherwise the plaintiff has no office at Ahmedabad or in Gujarat; (ii) the plaintiff has already filed an application under Order 7, Rule 14 of the CPC in CS(COMM) No. 1082/2016 titled HSIL v. Imperial Ceramic, CS(COMM) No. 1087/2016 titled HSIL v. Gujarat Ceramic Industries and CS(COMM) No. 1088/2016 HSIL v. Max Ceramic Industries which were also filed along with this suit, to place on record clarification issued in November, 2016 on the website of the plaintiff in this regard; (iii) thus the plea in the plaint, of the plaintiff not having a branch/subordinate office in Gujarat is correct; and (iv) that EVOK Stores are Home Stores and are of a different entity than the plaintiff and are not Stores of the plaintiff.

7. With respect to the contention of the defendants/applicants qua para 14 of Ultra Home Construction Pvt. Ltd. supra, attention is drawn by counsel for plaintiff to page 799 of the documents, being a copy of the order dated 8th July, 2016 in FAO(OS)(COMM) No. 35/2016 titled HSIL Ltd. v. Oracle Ceramic, 2016 (66) PTC 511(Del), where the Division Bench has inter alia held as under:-

"3. With respect to the impugned order dated May 11, 2016, having heard learned counsel for the parties we find that the law culled out by the learned Single Judge with respect to the decision of the Supreme Court reported as AIR 2015 SC 3479 Indian Performing Rights Society Ltd. v. Sanjay Dalia.

4. As per said decision if plaintiff has no presence in the territory where the offending activity is carried on, remedy of territorial jurisdiction with reference of Section 134 of the Trade Marks Act, 1999 can be availed of. Though there is no positive view of a negative fact in the plaint, but there is no admission that the plaintiff i.e. the appellant has presence in Rajkot (Gujarat), where the alleged offending activity is being carried on.

5. Accordingly, we set aside the impugned order dated May 11, 2016. We declare that the three suits, the plaints where of have been directed to be returned, shall continue in Delhi for the reason as pleaded in the plaint, there would be territorial jurisdiction in this Court. Of course, if the defendants plead and can prima-facie show that the plaintiff has presence in Rajkot, of the kind contemplated by law, plea of lack of territorial jurisdiction can be raised."

On the basis of the aforesaid order it is contended that it is of a date subsequent to Ultra Home Construction Pvt. Ltd. supra and has held that the plaintiff can sue at Delhi if has a subordinate office at Delhi.

8. I have considered the aforesaid contentions.

9. The document at page 429 of the plaintiff's own documents appears to be photocopy of a page out of Annual Report of the plaintiff. The counsel for the plaintiff however controverts and draws attention to the index of the documents wherein at serial no.10, against the pages 124 to 430, the description given of the document is "Copy of various advertising brochures of the Plaintiff Company" and states that page 429 is not part of Annual Report of plaintiff but is a part of an advertising brochure of the plaintiff. However there does not appear to be any merit in the said contention. The document at page 429 from its preceding two pages which are a 'Proxy Form' and 'Attendance Slip', is clearly a part of the Annual Report of the plaintiff. Even otherwise it, defies logic as to why in an advertising brochure, 'Corporate Information' would be given. A further flipping of pages shows page 429 to be a part of the Annual Report of the plaintiff for the year 2014-15 commencing from page 242.

10. The counsel for the plaintiff also, after studying his file agrees that the statement earlier made of page 429 supra being from the advertising brochure and the description in the list of documents of the said document as advertising brochure, is erroneous and the document is indeed the Annual Report. The counsel for the plaintiff is however not carrying the original thereof with him.

11. Once it is not in dispute that page 429 supra is indeed a part of the Annual Report of the plaintiff for the year 2014-15, then the plaintiff which on enquiry is informed to be a public listed company, cannot to its shareholders and to the public at large represent that it has a regional office and a retail outlet at Ahmedabad and in the Court take a stand that it has no branch/subordinate office or retail outlet at Ahmedabad, contending the said regional office to be not a brick and mortar office but only a telephone number and e-mail address and the retail outlet to be of some other entity. The plaintiff, in such an event, would be guilty of violation of several guidelines of Securities and Exchange Board of India (SEBI), Stock Exchange Listing Requirements and best practices advised for the public listed companies. Moreover the plaintiff, in the plaint, while making a unequivocal statement of not having a branch/subordinate office in Gujarat, did not so clarify and which may have resulted in the suit being not even entertained and has given this explanation now only when defendants/applicants have drawn attention to page 429. The plaintiff, by following such practise, is also not found to have approached the Court with clean hands and has dis entitled itself to any discretionary relief.

12. The second of the aforesaid contentions of the counsel for the plaintiff, on the basis of the order dated 8th July, 2016 supra of the Division Bench, is also not found to have any merit. The Division Bench therein has not considered the question, whether Section 134 can be invoked at the place of the subordinate office if no cause of action has accrued therein, as has been considered in detail in Ultra Home Construction Pvt. Ltd. In fact Ultra Home Construction Pvt. Ltd., which was pronounced on 20th January, 2016, is also not found to have been considered in the order dated 8th July, 2016. The Division Bench in order dated 8th July, 2016 cannot thus be said to have held contrary to Ultra Home Construction Pvt. Ltd. as indeed it could not have. It may also be noted that what is not for consideration before the Court cannot constitute the ratio of the order of the Court. It has been held in Union of India v. Dhanwanti Devi (1996) 6 SCC 44, Bhavnagar University v. Palitana Sugar Mill (P) Ltd. (2003) 2 SCC 111, Kalyan Chandra Sarkar v. Rajesh Ranjan (2005) 2 SCC 42, Bharat Forge Co. Ltd. v. Uttam Manohar Nakate (2005) 2 SCC 489 and Inderpreet Singh Kahlon v. State of Punjab (2006) 11 SCC 356 that a judgment is a precedent on what falls for adjudication and not what can be logically deduced or inferred therefrom. The Division Bench, in order dated 8th July, 2016, was not considering whether Section 134 can be invoked at the place of plaintiff's subordinate office if cause of action has not accrued there, as Ultra Home Construction Pvt. Ltd. has done in detail. A judgment will constitute binding precedent in law, when an issue is raised, the statute and binding precedent cited, case thoroughly debated and properly considered by Court and then finding recorded. Where, an earlier judgment binding on the Bench which has enunciated a principle of law is not considered, such a decision will be per incuriam, binding parties thereto alone and will not constitute a binding precedent to be followed. Reference in this regard may be made to Draupadi Devi v. Union of India (2004) 11 SCC 425 and S. Nagaraj v. B.R. Vasudeva Murthy (2010) 3 SCC 353. Thus, even if it be held that the Division Bench in order dated 8th July, 2016 has found the plaintiff entitled to invoke Section 134 against the defendant not situated within the jurisdiction of this Court and against whom no cause of action had accrued to the plaintiff within the jurisdiction of this Court, for the reason of the plaintiff having a subordinate office within the jurisdiction of this Court, the same would only be res judicata for the purposes of the suit in which it was so decided and would not be a binding precedent to be followed in other cases filed by the plaintiff. Moreover, the Division Bench in the order dated 8th July, 2016 has not decided the issue of territorial jurisdiction finally and left it to be decided after the stage of filing of the written statement.

13. The counsel for the plaintiff at this stage draws attention to page 794 being the order dated 25th May, 2016 in the same appeal which was disposed of on 8th July, 2016 to contend that the Division Bench while issuing notice thereof considered the said aspect. It is further contended that the order of the Single Bench which was for consideration before the Division Bench was purely based on Ultra Home Construction Pvt. Ltd.

14. The same would in my view not make any difference. The final order dated 8th July, 2016, by which the appeal was disposed of, cannot as aforesaid be said to be laying down any law contrary to Ultra Home Construction Pvt. Ltd. for it to be even said that there is any conflict in the order dated 8th July, 2016 and the judgment in Ultra Home Construction Pvt. Ltd.

15. The counsel for the applicants/defendants in this regard draws attention to M/s. Allied Blenders & Distillers Pvt. Ltd. v. R.K. Distilleries Pvt. Ltd. 2016 SCC OnLine Del 4097 but need to refer whereto which is a dicta of a Single Judge of this Court is not felt.

16. The counsel for the plaintiff at this stage insists on reading out paras 1 to 4 of the order dated 25th May, 2016 but which only record the contentions of the counsel for the appellant before the Division Bench and after recording which notice was issued. The same is an ex parte order and merely because notice of the appeal was issued does not allow the counsel for the plaintiff to rely on his own contentions recorded therein and to cite the same as precedent. As far as the final order dated 8th July, 2016 is concerned, I have already re-produced the relevant part thereof herein above and which cannot be read as laying anything contrary to what has been held in Ultra Home Construction Pvt. Ltd.

17. The request of the counsel for the plaintiff at this stage, to refer the matter to the Division Bench owing to a conflict between the order dated 8th July, 2016 supra and Ultra Home Construction Pvt. Ltd. cannot be accepted. I may notice that a Single Judge of this Court in RSPL Ltd. v. Mukesh Sharma (2016) 229 DLT 651 expressed reservations qua the view taken in Ultra Home Construction Pvt. Ltd. though observing the same to be binding on the Single Judge. The same Division Bench which had pronounced Ultra Home Construction Pvt. Ltd., in appeal in RSPL Ltd. v. Mukesh Sharma, in rather strong words, deprecated such expression of views by the Single Judge.

18. The counsel for the plaintiff has not controverted that as per para 14 of Ultra Home Construction Pvt. Ltd. and the relevant part whereof is re-produced herein below,

"The fourth case is where the cause of action neither arises at the place of the principal office nor at the place of the subordinate office but at some other place. In this case, the plaintiff would be deemed to carry on business at the place of its principal office and not at the place of the subordinate office. And, consequently, it could institute a suit at the place of its principal office but not at the place of its subordinate office."

This Court does not have territorial jurisdiction. Thus, irrespective of whether the plaintiff has a regional office in Gujarat or not, this Court as per the dicta in Ultra Home Construction Pvt. Ltd. and on the averments in the plaint does not have jurisdiction to entertain the suit and the applications have to succeed.

19. The applications are thus allowed.

20. The plaint is returned/rejected.

21. Needless to state that the ex parte order dated 5th October, 2016 stands vacated.

22. The question of costs shall be considered at a later stage.

23. Not

ice is issued to the plaintiff and the person who has signed and verified the plaint on behalf of the plaintiff to show cause as to why appropriate action should not be taken against the plaintiff and the said person for false verification of the plaint and for mis-description of the document at page 429 in the list of documents and as to why the matter should not be referred to SEBI and to the Ministry of Corporate Affairs, for the plaintiff in the Annual Report claiming Regional Offices at Ahmedabad, Bengaluru, Bhubaneswar, Chandigarh, Chennai, Eranakulam, Ghaziabad, Guwahati, Indore, Jaipur, Lucknow, Mumbai, Pune, Ranchi, Secunderabad, Vijayawada and Vizag, to inspire confidence in the shareholders of the plaintiff and before this Court taking a stand that there are no offices and there are only telephone numbers and e-mail addresses. Had the shareholders known that it is so, they may have viewed the functioning and affairs of the plaintiff differently. 24. In this regard it may be stated that the documents of the plaintiff run into 895 pages and it is not possible while reading the file before the hearing to run through each and every page and an inkling of the documents is taken from the description thereof in the list/index which is filed. The plaintiff, describing the documents in the index as advertising brochures, cannot file other documents. Had the document been described as the Annual Report, it is well-nigh possible that while so reading the file, the Annual Report may have been perused, suit may not have been entertained and ex parte orders of injunction and appointment of Court Commissioner not made. 25. The reply to the show cause be filed within ten days. 26. List on 21st February, 2017.