Exphar SA and Anr. v. Eupharma Laboratories Ltd. and Anr.
(2004) 3 SCC 688
The appellant and M/s. Shreechem Laboratories filed a suit before the Hon’ble High Court of Delhi for infringement of Copyright in packaging, layout and design of their medicine ‘Maloxine’ along with a claim for passing off.
The claim of the appellants was, that the respondent No. 2 had a manufacturing agreement with the first appellant and the same was terminated. Despite that termination, the Respondent No. 2 continued to manufacture and export the medicine ‘Maloxine’ to M/s. Moore Associates.
An ex-parte interim order was passed in favour of the appellants which was later confirmed by the Single Judge. Interestingly, nowhere in the suit the question of lack of territorial jurisdiction was raised. Though the injunction was granted in favour of the appellant, the same was a limited injunction wherein the respondents were allowed to use the term ‘Maloxine’ but in a different packaging.
Both the parties filed an appeal against the said order. The respondents never raised the question of territorial jurisdiction. However, the appeal of the Respondents was allowed and the plaint of the Appellant were directed to be returned for the purpose of filing the same before the appropriate Court. Thus, the appeal of the appellants was also dismissed.
The Hon’ble Division Bench of the Delhi High Court held:
“Admittedly the goods are being traded outside India and not being traded in India and as such there is no question of infringement of trademark within the territorial limits of any Court in India what to of Delhi.”
Against the said order, the appellants filed the an appeal before the Hon’ble Supreme Court. The Supreme Court allowed the appeal of the appellants and held that:
- When an objection to jurisdiction is raised by way of demurrer and not at the trial, the objection must proceed on the basis that the facts as pleaded by the initiator of the impugned proceedings are true.
- In rejecting a plaint on the ground of jurisdiction, the Division Bench should have taken the allegations contained in the plaint to be correct.
- The Division Bench examined the written statement filed by the respondents in which it was claimed that no goods were sold within the jurisdiction of the Delhi High Court as well as the Respondent No. 2 did not carry any business within the jurisdiction of this Court.
- The Division Bench erred in construction of Section 62 of the Copyright Act.
- Jurisdiction of a Court for the purpose of Section 62 is wider than that of the Court as prescribed under the Code of Civil procedure, 1908.
- Section 62 prescribes an additional ground for attracting the jurisdiction of Court over and above the grounds as laid down in Section 20 of the Code of Civil Procedure.
- The Division Bench went beyond the words of the statute.
In coming to the said conclusion, the Hon’ble Supreme Court also relied on the following extract from the Report of the Joint Committee published on 23rd November, 1956.
“In the opinion of the Committee many authors are deterred from instituting infringement proceedings because the court in which such proceedings are to be instituted is situated at a considerable distance from the place of their ordinary residence. The Committee feels that this impediment should be removed and the new Sub-clause (2) accordingly provides that infringement proceedings may be instituted in the district court within the local limits of whose jurisdiction the person instituting the proceedings ordinarily resides, carries on business etc.”
 “Section 62. Jurisdiction of court over matters arising under this Chapter – (1) Every suit or other civil proceeding arising under this Chapter in respect of the infringement of copyright in any work or the infringement of any other right conferred by this Act shall be instituted in the district court having jurisdiction.
(2) For the purpose of Sub-section (1), a “district court having jurisdiction” shall notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908), or any other law for the time being in force, include a district court within the local limits of whose jurisdiction, at the time of the institution of the suit or other proceeding, the person instituting the suit or other proceeding or, where there are more than one such persons, any of them actually and voluntarily resides or carries on business or personal works for gain.”