1 conp114-04 jud.sxw pps IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION Contempt Petition No.114 of 2004 in Notice of Motion No. 3714 of 2003 in Suit No. 3940 of 2003 Hindustan Petroleum Corporation Ltd. A Government of India Enterprise, having its Registered Office at 17, Jamshedji Tata Road, Mumbai 400 020 .. Petitioner (Original Plaintiff) v/s. 1. H.P.Oil Corporation Ltd. A Company incorporated under the Companies Act, 1958 having its registered office at 704 Krishna Tower, 15/63, Civil Lines, Kanpur 208 001 ..Respondent No.1 (Original Defendant) 2. Dinesh Chand Katiyar Director of H.P. Oil Corporation Ltd. having its office at 704 Krishna Tower, 15/63, Civil Lines, Kanpur 208 001 3. Anil Kumar Katiyar Director of H.P. Oil Corporation Ltd. having its office at 704 Krishna Tower, 2 conp114-04 jud.sxw 15/63, Civil Lines, Kanpur 208 001 Respondent Nos.2 and 3 Mr. Salil Shah with Mr.Gajria i/b/ Gajria & Co. for the Petitioner. Mr. Pranav Sampat i/b. Thakore Jariwala & Associates for the Respondents CORAM : R.Y.GANOO, J. DATED : 9th March, 2011 & 10th March, 2011 ORAL JUDGMENT : 1. The petitioners herein is a Public Corporation namely Hindustan Petroleum Corporation Limited. The respondent No.1 is a limited company incorporated under the Companies Act, 1956. The respondent no.2 and 3 are the Directors of respondent no.1. According to the petitioners, the respondent no.1 committed certain acts which resulted in violation of the trade mark held by the petitioners in regard to their products. In order to injunct the respondent no.1 from violating the trade marks held by the petitioners, the petitioners instituted Suit No.3940 of 2003 in this Court against the respondent No.1 company under the Trade Mark Act, 1999. The petitioners sought substantive relief in the nature of injunction to protect their marks. Interim reliefs were sought in 3 conp114-04 jud.sxw the said suit. 2. The petitioners had taken out Notice of Motion No.3714 of 2003 in the aforesaid Suit No.3940 of 2003 and had asked for following reliefs: a) That pending the hearing and final disposal of the Suit, the Defendants, their servants and agents be restrained by an order and injunction of this Honourable from in any manner manufacturing, marketing selling, advertising or using in any manner in relation to Liquified Petroleum Gas, Petroleum, industrial oil and grease, lubricants, dust laying and absorbing compositions, fuels, illuminants candles, tapes, night lights, wicks or any other goods in Class 4 of the Fourth Schedule of Trade Marks Act, 1999 and Rules thereunder, the mark and logo described in Exhibit E to the plaint or any other mark/logo or device indentical or deceptively similar to the plaintiffs registered trade mark nos.330304, 350757 & 410320 in class 4 so as to infringe the same; b) That pending the hearing and final disposal of this suit, the defendants, their servants and agents be restrained by an order and injunction of this Honourable Court from in 4 conp114-04 jud.sxw any manner manufacturing, packaging, using, selling or suffering for sale of Liquified Petroleum Gas or any other goods containing the letters “HP” or the logo described in Exhibit-E to the plaint or any part thereof or any other mark or logo to words deceptively similar to the plaintiffs marks or logos or its corporate name so as to pass of its products or business as and for that of the plaintiff. c) That pending the hearing and final disposal of this Suit, the Defendants, their servants and agents be restrained by an order and injunction of this Honourable Court from in any manner using its Corporate name “Hindustan Petroleum Oil Corporation Ltd.” or the letters “H.P.” or words “Hindustan Petroleum”, or any other letters or words deceptively similar to the plaintiffs name or marks, as part of its trading style. d) That pending the hearing and final disposal of this suit, this Honourable Court be pleased to appoint the Court Receiver, High Court, Bombay with all powers under Order XL, of the Code of Civil Procedure 1908, including the power to enter and search at any time and palce (even after sunset) including on holidays without notice, to seize, destroy, erase and or store the impugned products, labels, cartons, packets materials, boards, goods, wrappers, papers, 5 conp114-04 jud.sxw books, dies and things bearing the impugned trade marks or logo to letter “H.P” wherever situate and to take police assistance when deemed fit. 3. The said motion was taken up for ad-interim hearing and by order dated 4.3.2004 an ad-interim order of injunction was passed against the respondent no.1 in terms of prayer clauses (a), (b), (c) and (d) so that the respondent no.1 would not indulge in infringement of the registered trade mark. It is to be noted that ad-interim order in terms of prayer clause (d) was suspended for a period of four weeks from 4.3.2004. 4. The respondent no.1 filed Appeal No.352 of 2004 before the Division Bench of this Court so as to challenge the ad-interim order dated 4.3.2004. That appeal was dismissed by the Division Bench by its order dated 16.6.2004. Against the said Order dated 16.4.2004, the respondent no.1 filed Special Leave Petition (L) No.19378 of 2004 and it is a common ground that the said Special Leave Petition has been dismissed. On account of dismissal of appeal on 16.6.2004 the limited stay granted to prayer clause (d) 6 conp114-04 jud.sxw also came to an end on 16.6.2004. 5. The aforesaid developments will clearly go to show that respondent no.1 was injuncted in terms of prayer clauses (a), (b) and (c). It is to be noted that the Notice of Motion No.3714 of 2003 is pending. 6. After the order dated 4.3.2004 the employees of the petitioner in the company of the representative of the Court Receiver visited the premises of the respondent no.1 on 15.9.2004. The Court Receiver found that the respondent no.1’s office was working and there were several employees present. He also found several items namely Rubber Stamp, Pamphlets containing HP Logo, copy of advertisement in vernacular language, bunch of copies of confirmation of territory for appointment of distributors/dealers/sub-dealers, bunch of proposal forms for H.P. Oil Corporation Ltd. for dealers and letterheads of H.P. Oil Corporation Ltd., bunch of envelopes containing HP Logo and blank agreement file. The Receiver’s Representative took 7 conp114-04 jud.sxw possession of all these articles. All this material which was found in the office of the respondent no.1 shall hereinafter be referred to as the said ‘material’. 7. It is also the case of the petitioners that the order of injunction in terms of prayer clause (a), (b) and (c) is running against the respondent No.1 even today. The petitioners came across in all four advertisements said to be published by respondent no.1 calling for applications from various persons to appoint them as agents in the State of Maharashtra for distribution of their LPG Gas as also supply of complete set (cylinder, burner stove, regulator with pipe). These advertisements were found in the following newspapers with respective dates, (1) Time of India – Bombay Edition dated 24.10.2004, (2) Indian Express – Bombay Edition dated 24.10.2004, (3) Economic Times- Bombay Edition dated 24.10.2004, (4) Mid Day -Bombay Edition dated 28.10.2004. The four advertisements as they appeared in news papers are annexed to the petition at Exhibit D-1 to D-4. It is to be noted that the name of the Company shown in the 8 conp114-04 jud.sxw advertisement is H.P. Oil Corporation Limited. As per the advertisements the applications were to be submitted at the following address:- H.P.Oil Corporation Ltd. Marketing Division, 704 Krishna Tower, 1563, Civil Lines, Kanpur 1. It is to be noted that the aforesaid address tallies with the address of the respondent no.1. 8. According to the petitioners finding of the said material in the office of the respondent no.1 coupled with publication of the advertisements at Exhibits D-1 to D-4 resulted in violation of the order of injunction dated 4.3.2004. (Hereinafter referred to as said Order’) According to the petitioners, respondent nos.2 and 3 have in their capacity as Directors of Respondent No.1have violated said order. According to the petitioners violation of said order by Respondent Nos.1 to 3 has resulted in contempt of the court. The Petitioners have prayed for action against Respondent Nos.1 to 3. in accordance with the provisions of Contempt of 9 conp114-04 jud.sxw Court Act, 1971. 9. After the service of contempt petition upon the respondents, respondent no.2 has filed in all three affidavits, namely affidavit dated 12.4.2005, 8.7.2005 and 2311.2007. The respondent no.3 has filed affidavit dated 25.2.2011 when hearing of the contempt petition commenced. 10.According to the Petitioners finding of said material in the office of respondent no.1 shows that the respondent nos.1 and its Directors have been carrying on the business in the name of H.P. Oil Corporation Ltd. and the such carrying on business in the name of H.P. Oil Corporation Limited amounts to violating the terms of the said order. It is also the stand of the petitioners that the advertisements published at Exhibit D-1 to D-4 clearly indicated that the respondent no.1 and its Directors namely the respondent Nos.2 and 3 wanted to give an impression to the members of the public at large that there is an organization by name H.P. Oil Corporation Ltd., and the said organization is 10 conp114-04 jud.sxw receiving the applications for appointment of agents. The advertisements at Exhibit D-1 to D-4 are in complete violation of the order of injunction in terms of prayer clauses (a), (b) and (c). It is also the stand of the petitioners that after the order of injunction, it was wrong on the part of the petitioners to continue to use the name of the Company as H.P.Oil Corporation Ltd. 11.With the above allegations of contempt, I have heard learned counsels on both sides. It would be convenient at this juncture itself to deal with the stand taken by the respondent nos.1 to 3 in terms of their affidavits. In the said reply dated 12.4.2005 the stand was taken by the respondent no.2 that Mr.Raj Kishore Katiyar and Mr. Manoj Katiyar are not the Directors of the respondent no.1. It appears that on account of this stand, names of Rajkishore Katiyar and Anilkumar Katiyar were deleted and Dinesh Chand Katiyar and Anil Kumar Katiyar were brought on record as respondent nos.2 and 3 respectively. It is required to be stated that the respondent no.1 does not dispute this change. Dinesh Katiyar and Anil Katiyar have admitted that they are 11 conp114-04 jud.sxw Directors of respondent no.1. It is in this circumstances, one will have to consider whether respondent nos.2 and 3 have violated said order and committed contempt. 12.The affidavit in reply dated 12.4.2005 filed by the respondent no. 2 suggests that the application for change of name of the Company was made on 12.4.2005 and change of logo was sought to be made by 4.12.2004. By the next affidavit dated 8.7.2005 the allegations are denied. According to the respondents there is no willful default. It is pertinent to note that in affidavit in reply dated 8.7.2005 the respondent no.2 has admitted the visit of the Court Receiver. He has also admitted finding of letterheads, rubber stamp, etc. However, according to him all that material was printed prior to the injunction order. The respondent no.2 in the said affidavit has denied the advertisement having been issued by respondent no.1. Respondent No.2 has reiterated his stand about taking steps to change the name of the company and logo. 12 conp114-04 jud.sxw 13.In the third affidavit dated 23.11.2007 it is sought to be contended that the order of injunction is complied with and new name is secured by the Company namely Bharat Oil & Gas Corporation. In paragraph 5 it is specifically mentioned that non compliance of any order of this court , if any, is unintentional, not deliberate and on behalf of the respondents apology is tendered. In paragraph 6 following sentence is noted with reference to the apology. “I once again reiterate and apologize for any conduct of myself and by my co-respondents that may be considered as contemptuous” It is to be noted that till 25.2.2011 respondent no.3 had not filed any affidavit in reply. Ultimately the respondent no.3 has filed an affidavit in reply dated 25th February 2011. By this affidavit the respondent no.3 has taken the stand that throughout the duration of the matter (possibly respondent no.3 wants to suggest that throughout the proceeding instituted by the plaintiff for order and injunction etc upto the hearing of the contempt petition) he was not incharge of day to day affairs of the company. He states that his Cousin brother and respondent no.2 were incharge of the 13 conp114-04 jud.sxw affairs of the company. He further staes that very recently when the warrant was issued he started interacting with his Advocates. He submitted that he is not guilty of Contempt. He has tendered his unconditional apology. 14.With the aforesaid affidavits in reply, I am now required to decide whether the petitioners have been able to make out a case as put up in the contempt petition. The order of injunction dated 4.3.2004 is very clear and it had the effect of protecting the trade mark of the petitioners with reference to the logo as well as the name of the company as Hindustan Petroleum Corporation. I have already indicated that during the visit of the Receiver for the purpose of compliance of prayer clause (d) the Receiver inspected the premises of the Respondent no.1 at Kanpur on 15.9.2004 and said material was found. It is pertinent to note that the said visit of the Receiver is accepted by the respondent no.2 in affidavit dated 8.7.2005. Even in the said affidavit the presence of the said material in the premises of the respondent no.1 is admitted. The respondent no.2 has come out with explanation 14 conp114-04 jud.sxw that the said material was printed prior to the order of injunction. In my view the presence of the said material in the premises of the respondent no.1 after passing of the order of injunction itself is sufficient to come to the conclusion that the respondent no.1 and the directors intended to use the said material for the purpose of using the name of the company as H.P. Oil Corporation. In the normal course, after the issuance of the order of injunction it was necessary for the respondent no.1 and its Directors to destroy the said material or surrender it to the Receiver. The very fact that the respondent no.1 and its Directors continued to retain the said material in the premises of the respondent no.1 after the order of injunction clearly indicates that they intended to use the said material whenever it was required to be used. 15.The respondent no.2 has come out with the case that the application to change the logo of the company was made sometime in December 2004 and the application for change in the name of company was made in April 2005. This indicates that the respondent no.1 and the Directors continued to use the name of 15 conp114-04 jud.sxw the respondent no.1 in the manner and style in which it was prevented by the order of injunction till April 2005. This will mean that the finding of the said material in the premises of the respondent no.1 was not without any meaning and that the said material was not lying in the premises of the respondent no.1 as idle or waste material. In my view, the presence of the said material in the premises of the company has the effect of violating the order dated 4.3.2004. 16. A specific stand has been taken that steps were taken to change name of the Company in April 2005 and for the change in logo was made in December 2004. These steps are taken after 6 months from the dismissal of the appeal. This clearly shows that the respondent no.1 and its Directors were using the name of the company despite the order of injunction. To that extent the respondents have clearly committed Contempt of this Court. 17.I now come to the question whether the advertisements at Exhibit D-1 to D-4 amount to violation of order of injunction. The 16 conp114-04 jud.sxw perusal of cuttings which are annexed at Exhibit D-1 to D-4 go to show that the said advertisement is published by the company whose name is just the same as the respondent no.1. The address for communication appearing in the said cutting is just same as respondent no.1. The logo of H.P. appearing in the said advertisement as well as the name of the company “H.P.Oil Corporation Limited’ is in complete violation of the order of injunction dated 4.3.2004. The question is whether these advertisements have been published at the instance of the respondent no.1 and whether respondent nos.2 and 3 could be held responsible for that. 18.When the advertisement is published in a news paper the members of the public would labour under impression that the said advertisement is published by the company for whose benefit the said advertisement is published. In very exceptional case, a person would arrange to publish the advertisement at his cost in the name of some other company. 17 conp114-04 jud.sxw 19.In the present case, the respondents have merely denied the publication of advertisement at their instance. This mere denial is not sufficient defence. Respondents were served with the copy of the contempt petition along with its exhibits. Hence it can be observed that on receipt of the copy of the contempt petition it was brought to their knowledge that a company having name similar to the name of the respondent no.1 has published advertisement and prima facie those advertisements are in violation of the order of injunction. On perusal of these advertisements and the relief granted in favour of the plaintiffs, it is clear that these advertisements have violated the order of injunction. 20.The next question is whether the case put up by the respondents that they had not published the advertisements should be accepted. After these advertisements were brought to the notice of the respondent, it was possible for the respondents to approach the respective news papers and try to get information from them as to who had placed order to publish the 18 conp114-04 jud.sxw advertisements. Surely, these advertisements have not been published by these newspapers on their own. The respondents have not specifically stated that these advertisements do not pertain to their company. 21.As mentioned earlier, it is was possible for the respondents to collect the necessary data from the concerned news papers and produce it before the court show that the advertisements were published at the instance of some other person and not at the instance of the respondent no.1 or its Directors. No such steps have been taken by the respondents. In the absence of such data, I am inclined to draw adverse inference against the respondents. The very fact that the respondent no.1 took steps to change the logo in December 2004 and to change the name of the company in April 2005, clearly indicated that respondent no.1 intended to use the objectionable name even in the month of October 2004 i.e. the period when the order was running against the respondents. For the aforesaid reasons, I am inclined to observe that these advertisements have been published by the respondents. In a 19 conp114-04 jud.sxw peculiar matter like this mere denial by the respondents was not sufficient. 22.For the reasons mentioned aforesaid, I hold that the petitioners have made out a case that the respondent no.1 has committed contempt of court. 23. Respondent Nos.2 and 3 are Directors of Respondent No.1 The Directors work for the benefit of the company and therefore the Directors of the Limited company are responsible for the acts which are committed for and on behalf of the company. The respondents in their capacity as Directors participated in the affairs of the company and they were responsible for retaining the said material in the premises of the respondent no.1. They were also responsible for publishing advertisements at Exhibit D-1 to D-4. The respondent nos.1 and 2 did not take steps to suspend the use of the company’s name and logo immediately on passing of said order. It took steps for changing the logo and the name of the company only in December 2004 and April 2005 respectively i.e. 20 conp114-04 jud.sxw much after the order of dismissal of the appeal. All this will clearly go to show that the conduct of the respondent nos.2 and 3 as directors of respondent no.1 was not innocent. The respondents nos.2 and 3 fully knew the consequences of their acts. They are responsible for all acts which led to violation of order of injunction. 24.For the reasons mentioned aforesaid, I hold that the petitioners have been able to make out a case that the respondent nos. 2 and 3 have committed contempt of this court by violating the order of injunction dated 4.3.2004. (Judgment part dictated. Adjourned to 10.3.2011) [R.Y.GANOO, J.] (Judgment continued on 10.3.2011) 25.The next question is whether the apology tendered by the respondent nos.2 and 3 through affidavits should be accepted and 21 conp114-04 jud.sxw the case be treated as closed. The respondents have in all filed four affidavits, three of them are filed by respondent no.2 and one is filed by respondent no.3. In the affidavit in reply dated 12.4.2005 and 8.7.2005 filed, respondent No.2 has not tendered apology. In the third affidavit dated 23.11.2007 filed by the respondent no.2 in very sketchy manner respondent has tendered apology. The relevant sentence is as under: “ I once again reiterate and apologize for any conduct of myself and of my co-respondents that may be considered as contemptuous” In my view, this sentence quoted aforesaid cannot be considered as an apology. The said statement is not couched with a view to place before the Court an apology. It has been made in a casual manner. Hence the so called apology tendered by the respondent no.2 vide affidavit dated 23.11.2007 cannot be accepted. Then comes the affidavit filed by respondent no.3 dated 25.2.2011. It is only when in the course of hearing it was noticed that the respondent no.3 has not filed any affidavit in reply, the said fact was indicated to the Advocate appearing for the respondents. It 22 conp114-04 jud.sxw appears that the respondent no.3 took hint from the said suggestion and proceeded to file affidavit in reply dated 25.2.2011. In this affidavit, the respondent no.3 has stated in paragraph 2 that he is tendering unconditional apology. Respondent no.3 has offered explanation about his role in the working of the company. He has stated that he was not concerned with the day to day affairs of the company and that is how he is trying to save himself. It is to be noted that the respondent no.1, a private limited company has only two Directors i.e. respondent no.2 and respondent no.3. In this peculiar situation it is difficult to conceive as to how the respondent no.3 will not have day to day connection with the affairs of the respondent no.1. Therefore the stand taken by the respondent no.3 in paragraph 2 just can’t be accepted. In paragraph 3 he states that when he came to know about the issuance of warrant by the court, he started interacting with the Advocate and got the information. He further states that he is not guilty of the contempt however tendered apology in following words: “In any event, I tender my unconditional apology to this 23 conp114-04 jud.sxw Honourable Court”. In my view this portion quoted above cannot be considered as an apology. It cannot be accepted and the respondent no.3 cannot be excused. Hence the submission made by the Counsel for the respondents that the apology tendered by the respondent nos.2 and 3 be accepted and the