Case: Kanade Anand Udyog Private Limited Vs. Indiana Gratings Private Limited &amp; Others

Plaintiffs original artistic work in the drawings. The Plaintiff averred that Defendant No.24 has been awarded six contracts of the value of Rs.4.7 crores by Bharat Heavy Electricals Ltd. Essentially, in the fresh motion three reliefs were sought by the Plaintiff – (i) Action under Order 39 Rule 2A for breach of the order of injunction; (ii) The striking out of the defence of the Defendants; and (iii) The appointment of a Receiver of electroforged grating machines manufactured from parts based on the drawings of the Plaintiff.6. Defendant No.24 filed an affidavit in response to the Notice of Motion on 9 June 2009. In the affidavit, it was stated that the brochures which are relied upon by the Plaintiff pertain to a machine which was imported by the Defendant from a South African supplier against an order placed on 15 January 2008. Defendant No.24 stated that the Company had commissioned the electroforged machine imported from the South African supplier and has been conducting its business from the said machine. What Defendant No.24 did not disclose in his affidavit is that besides the machine imported from South Africa, the Company was in possession of two additional machines which were sourced indigenously.7. A rejoinder was filed by the Plaintiff on 29 August 2009. Exhibit ‘A to the rejoinder contains a statement of the orders obtained by Defendant No.24, many of which were prior to the date of the import of the machine from South Africa. This was relied upon by the Plaintiff in order to establish the case that Defendant No.24 was in possession not only of an imported machine, but other machines which were based on the use of the parts made in infringement of the copyright of the Plaintiff.8. On 22 June 2010, in a statement made on behalf of Defendant No.24 before the Learned Single Judge, the Company conceded that it had three electroforged grating machines one of which was imported from South Africa. The Learned Single Judge directed Defendant No.24 to show how and when these three electroforged grating machines or parts thereof had been purchased. In response to those directions, an affidavit was filed by Defendant No.24 on 28 June 2010. In the affidavit, it was stated that Defendant No.24 has three machines, one of them being sourced from South Africa and for the other two machines, parts were purchased locally in India from diverse manufacturers. Documents were disclosed by Defendant No.24.9. The Plaintiff filed an affidavit before the Learned Single Judge on 6 July 2010. The affidavit buttressed the case of the Plaintiff that the two indigenous machines which were in the custody of Defendant No.24 had been assembled from the use of parts which were made in infringement of the copyright of the Plaintiff in its artistic work. For instance, in respect of the first machine, the Plaintiff pointed out that Defendant No.24 was incorporated only on 12 July 2005 and hence the company could not have procured or acquired the parts of that machine. Most of the purchase orders corresponding to the invoices were prior to the date of incorporation of Defendant No.24. None of the invoices were raised on Defendant No.24. Of the total payment of Rs.72.52 lakhs, Defendant No.24 made a payment of Rs.2.84 lakhs. Significantly, Defendant No.24 failed to produce even a single drawing to establish that the two indigenous machines had been assembled on the basis of drawings other than the drawings of the Plaintiff. The Plaintiff also highlighted various invoices which pertain to specific machine parts for which drawings were necessarily required. Exhibit ‘A to the affidavit filed by the Plaintiff is titled Illustrative invoices exposing Infringement. Exhibit ‘A contains a list of orders placed by Defendant No.24 on parties from whom drawings pertaining to the particular part were recovered. For instance, in Sr.No.1 of Exhibit ‘A which relates to Defendant No.20, the drawings of the Plaintiff were recovered from that Defendant and from the workshop of the First Defendant. Exhibit ‘D to the affidavit contains a statement of invoices produced by Defendant No.24 which as a matter of fact referred to drawings. Despite being called upon to produce the drawings by the Plaintiff, Defendant No.24 failed to produce any drawings.10. The principal contention which has been urged on behalf of the Appellant, original Defendant No.24, is that no comparison was made by the Learned Single Judge of the machines in the custody of Defendant No.24 with the artistic drawings of the Plaintiff and it is only on that basis that a case for infringement could have been made out. In our view, the Learned Single Judge has carefully evaluated the documents which were produced on the record and the surrounding circumstances of the case before entering a finding that the two indigenous machines in the custody of Defendant No.24 were assembled on the basis of parts which in turn had utilized drawings of the Plaintiff. Significantly, Defendant No.24 did not produce any drawings at all. The case of the Plaintiff was that the machines were assembled on the basis of the parts sourced from various fabricators to whom the Plaintiffs drawings had been supplied in the past by its employees who had since resigned from service and joined the First Defendant. A prima facie case was made out for the grant of interim relief. The balance of convenience clearly lay in favour of the grant of relief as sought. Despite an order of injunction that was granted by the Learned Single Judge in the earlier motion, a device was created to defeat the order by setting up a case that Defendant No.24 was now in custody of the electroforged machine sourced from South Africa which is producing electroforged gratings. In these circumstances, the Learned Single Judge was entirely justified in appointing a Receiver in respect of the two indigenous electroforged grating machines and in directing the Receiver to seal the two machines. The Defendants have been permitted to use the machine which has been imported from Sough Africa.

Court's decision (1 = petition accepted / positive for appellant, 0 = rejected / negative): 0

Reasoning from the judgment:
0[ds]In our view, the Learned Single Judge has carefully evaluated the documents which were produced on the record and the surrounding circumstances of the case before entering a finding that the two indigenous machines in the custody of Defendant No.24 were assembled on the basis of parts which in turn had utilized drawings of the Plaintiff. Significantly, Defendant No.24 did not produce any drawings at all. The case of the Plaintiff was that the machines were assembled on the basis of the parts sourced from various fabricators to whom the Plaintiffs drawings had been supplied in the past by its employees who had since resigned from service and joined the First Defendant. A prima facie case was made out for the grant of interim relief. The balance of convenience clearly lay in favour of the grant of relief as sought. Despite an order of injunction that was granted by the Learned Single Judge in the earlier motion, a device was created to defeat the order by setting up a case that Defendant No.24 was now in custody of the electroforged machine sourced from South Africa which is producing electroforged gratings. In these circumstances, the Learned Single Judge was entirely justified in appointing a Receiver in respect of the two indigenous electroforged grating machines and in directing the Receiver to seal the two machines. The Defendants have been permitted to use the machine which has been imported from Sough Africa.