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1994 DIGILAW 700 (DEL)

AUTOMATIC ELECTRIC LIMITED v. R. K. DHAWAN

1994-10-17

VIJENDER JAIN, VUENDER JAIN

body1994
Mr. Vijender Jain, J. ( 1 ) AT the outset this Court took the objection that properan adequate Court fees has not been paid and the plaint is deficient. This is a suit forpermanent injunction restraining infringement, passing off, rendition of accounts ofprofits etc. The plaintiff claims to be a Company registered under the Companiesact. According to the case of the plaintiff in 1945the plaintiff adopted the trade mark dimmerstat in relation to their goods. Plaintiff has incurred substantialexpenses in sales promotion and advertising compaign pertaining to the goodsbearing the trade mark dimmerstat and therefore it has been averred that thetrademark of the plaintiff has earned reputation and good will. In paragraph 3of the plaint the plaintiff has given the turnover of sales of its product which in 1983-84 was approximately Rs. 10. 49 crores and in 1993-94 Rs. 31 crores. The suit has beenfiled by the plaintiff and it has been averred that defendants 1 and 2 are also engagedin the business of manufacturing and selling same kind of goods as has beenmanufactured and sold by the plaintiff. It has been averred that the defendants areusings the trade mark dimmer DOT which is deceptively similar with the trademark of the plaintiff. A legal notice was issued by the plaintiff on 7/4/1994 to stop thewrongful user of the trade mark. On the basis of these averments plaintiff has valuedthe suit for Court fees and jurisdiction in the following manner :- " (I) for a decre for permanent injunction restraining infringement of trademark, this relief is valued for purposes of Court fees and jurisdiction atrs. 200. 00 and Court fees of Rs. 20. 00 is affixed thereon; (ii) for a decree for permanent injunction restraining passing off, this reliefis valued for puposes of Court fees and jurisdiction at Rs. 200. 00 andcourt fees of Rs. 20. 00is affixed thereon; (iii) for a decree for delivery of infringing goods, this relief is valued forpurposes of Court fees and jurisdiction at Rs. 200. 00and Court fees of Rs. 20. 00 is affixed thereon; (iv) for an order for rendition of accounts of profits earned by the defendants, this relief is valued for purposes of Court fees at Rs. 200. 00 andcourt fees of Rs. 20. 200. 00and Court fees of Rs. 20. 00 is affixed thereon; (iv) for an order for rendition of accounts of profits earned by the defendants, this relief is valued for purposes of Court fees at Rs. 200. 00 andcourt fees of Rs. 20. 00is affixed theredon;this relief is valued for purpose of jurisdiction under the provisions of Order7 Rule 2 Civil Procedure Code read with Section 7 of Court-fees Act, 1870 and Section 9 of the Suitvaluation Act, 1887 alongwith Rules 3 and 4 of the Punjab and Haryana High Courtrules at Rs. 5,50,000. 00 as the said amount could be found due on rendition ofaccounts of profits by the defendants. The plaintiff undertakes to pay suchadditional Court fees as may be directed by this Court on the ascertainment of theamount so found due. Thus the suit is valued for the purpose of jurisdiction atrs. 5,50,000. 00and forthe purpose of court fees at Rs. 800. 00 and Court fees of Rs. 80. 00 is affixed thereon. At the end of paragraph 14 of the plaint the plaintiff has averred that the reliefis valued for purposes of jurisdiction under the provisions of Order 7 Rule 2 CPCread with Sec. 7 of the Court-fees Act, 1870 and Sec. 9 of the Suits Valuation Act, 1887along with Rules 3 and 4 of the Punjab and Haryana High Court Rules at Rs. 5. 50,000. 00 as the said amount could be found due on rendition of accounts of profitsby the defendants. It has been further averred by the plaintiff that the plaintiffundertakes to pay such Additional Court-fees as may be directed by this Court onthe ascertainment of the amount so found due. On the basis of this aforesaidvaluation as contained in paragraph 14 of the plaint the plaintiff has valued the suitfor purposes of jurisdiction at Rs. 5,50,000. 00 and for purposes of Court fees at Rs. 800. 00 and Court fees of Rs. 80. 00 has been paid on the plaint. ( 2 ). Mr. Aggarwal learned Counsel for the plaintiff has argued that in view ofthe amendment in the Punjab and Haryana High Court Rules and in view of Rules 3and 4 of the said amendment the plaintiff has got the right to fix any value for suitsfor rendition of accounts. 80. 00 has been paid on the plaint. ( 2 ). Mr. Aggarwal learned Counsel for the plaintiff has argued that in view ofthe amendment in the Punjab and Haryana High Court Rules and in view of Rules 3and 4 of the said amendment the plaintiff has got the right to fix any value for suitsfor rendition of accounts. The plaintiff valued this suit for purposes of jurisdictionat a figure which brought the suit within the pecuniary jurisdiction of this Court. Forthe purpose of present controversy Rule 4 is relevant which is as follows :- " (I) Suits in which plaintiff in the plaint seeks to recover the amount whichmay be found due to the plaintiff in taking unsettled accounts betweenhim and the defendant. (ii) Suits of either of the kinds described in Order XX, Rule 13 of the Codeof Civil Procedure:value for the purpose (a) As determined by theof Court fee Court-fees Act, 1870. Value for the purpose (b) For the purposes ofof jurisdiction the Suits Valuation Act, 1887,and the Punjab Courts Act,1918, as valued by the plaintiffin the plaint, subject todetermination by thecourt at any stage of the trial. " ( 3 ). Mr. Aggarwal has further contended that this Rule itself provides that if atany stage of trial the Court is of the opinion from material on record or evidenceproduced that the suit is under valued the Court can order for making up thedeficiency in Court fees but at the time of institution of the suit the law enjoinsplaintiff the right to fix its own valuation for purposes of rendition of accounts whichin this case he has valued at Rs. 200. 00 and the valuation for purposes of jurisdictionat Rs. 5,50,000. 00 which he is entitled to do in law. He has also invited the attentionof this Court to a decision M/s Commercial Aviation and Travel Co. (Inc.) and Others v. Vimal Pannalal, AIR 1986 Delhi 439 and on the basis of said authority Mr. Aggarwal has argued that the plaintiff could put his estimated value for purposesof jurisdiction and the grievance that the value for jurisdiction is higher would makeno practical difference since the value for purpose of Court-fees could be differentin view of the Rules being framed under Sec. 9 of the Suits Valuation Act and evenif the value is fixed for jurisdiction at a higher figure jurisdiction will remain in thiscourt. In M/s. Commercial Aviation and Travel Co. (supra), the Court laid downthat- "16. The Full Bench noted the various words used in various parts of Order 7of the Code. Order 7 Rule l (i) of the Code speaks of the "value of the subjectmatter". Order 7 Rule 2 of the Code speaks of the "amount sued for". Paragraph (iv) of Section 7 of the Court-Fees Act speaks of, "the amount atwhich he values the relief". The Full Bench considered the entire scheme of0rder7of the Code alongwith provisions of Section 7 (iv) of the Court-fees Act,1870 and came to the conclusion that. . . . . 8. 00that paragraph (iv) of Section 7 ofthe Court-fees Act gives a right to the plaintiff to place any value that he likeson the relief he seeks and the Court has no power to interfere with the plaintiff svalue. It was also held that this view is quite in conformity with the nature ofthe suit mentioned in Clauses (a) to (f) of paragraph (iv) of Section 7 of thecourt-fees Act. " ( 4 ). Relying his argument on the observations of the Division Bench Mr. Aggarwal has argued that paragraph (iv) of Sec. 7 of the Court-fees Act gives a rightto the plaintiff to place any value that he likes on the relief for rendition of accounts,he seeks, and Court has no power to interfere with the plaintiff s valuation on suchrelief. Mr. Aggarwal has further cited M/s. Commercial Aviation and Travelcompany and Others v. Mrs. Vimla Pannalal, AIR 1988 Supreme Court 1636 insupport of his submissions and has argued that the Supreme Court in M/s. Commercial Aviation Travel Co. (supra) has settled the controversy as in thatcasealso it was held that the valuation for the relief of the rendition of accounts of theplaintiff was maintained by the Supreme Court. No doubt, there is no controversyregarding fixing of Court fees by the plaintiff on the relief of rendition of accountsand the choice is left to the plaintiff to exercise that right in a proper manner. In thecase before me plaintiff has filed a suit essentially for seeking injunction, inter alia,alleging that the sale turnover of the plaintiff is Rs. No doubt, there is no controversyregarding fixing of Court fees by the plaintiff on the relief of rendition of accountsand the choice is left to the plaintiff to exercise that right in a proper manner. In thecase before me plaintiff has filed a suit essentially for seeking injunction, inter alia,alleging that the sale turnover of the plaintiff is Rs. 30 crores and he is seekinginjunction in view of his trade mark being registered and in the alternative on theground of passing off alleging that the trade mark of the defendant is deceptivelysimilar to that of the plaintiff and a further pray. is also made for rendition ofaccounts for alleged infringement or passing off. At the first instance in paragraph14 of the plaint plaintiff has placed the valuation of the relief of rendition of accountsat Rs, 200. 00 on which a Court fees of Rs. 20. 00 has been paid. In the same breath inthe same paragraph the plaintiff taking recourse to the provisions of Rules 3 and 4of the Punjab and Haryana High Court Rules which have been also adopted by thedelhi High Court has valued the relief for jurisdiction at Rs. 5,50,000. 00. Plaintiff hastaken the relief for rendition of accounts and placed its own valuation at Rs. 200. 00on which Court fees of Rs. 20. 00 has been paid. He has fixed the value for purposesof jurisdiction at Rs. 5,50,000. 00 taking benefit of the amendment of Rules 3 and 4 ofthe Punjab and Haryana High Court Rules. This is simply done in order to invoke thejurisdiction of this Court as this Court will have pecuniary jurisdiction if thejurisdiction of the subject-matter is over Rs. 5 lacs, otherwise in the normal course thejurisdiction would lie with the Subordinate Judge, Delhi. No doubt, law providesthat in case of relief for rendition of accounts when the amount is not ascertained aplaintiff cannot be asked to give a specific and ascertained figure of the amount onwhich relief is sought in the suit but that does not give a licence to the plaintiff to placea figure which is ridiculously on the lower side, whimsical and demonstrativelyarbitrary. I would also like to mention that the peculiar situation has arisen in Delhias most of the High Courts do not have Original Side jurisdiction in the country. I would also like to mention that the peculiar situation has arisen in Delhias most of the High Courts do not have Original Side jurisdiction in the country. Thesuit is filed to be maintained in this Court and that is why a figure of jurisdictionalvalue is fixed at Rs. 5,50,000. 00 so as to bring the suit in the pecuniary jurisdiction ofthe Original Side of Delhi High Court. There is no nexus rationale, objectivity ormaterial before the plaintiff to fix the valuation except to oust the jurisdiction of thecourt of the first instance, i. e. the Court of Subordinate Judge, Delhi. If the relief forrendition of accounts is not sought the plaintiff s suit which is essentially a suit forinjunction as mentioned aforesaid to maintain that suit within the pecuniaryjurisdiction of this Court the plaintiff has to pay Court fees at Rs. 5,50,000. 00. The suitswhich emanate from the breach of legal obligations regarding copy right, trademark, passing off are essentially the suits where the first relief is sought is aninjunction. The relief for renditon of accounts is to bring the suit within the ambit ofsec. 9 of the Suits Valuation Act, Court-fees Act read with Rules 3 and 4 of the Punjaband Haryana High Court Rules. The valuation is not only demonstratively arbitraryand whimsical but also mala fide. I would also like to observe that relying onabdal Humid Shamsi v. Abdul Majid and Others JT 1988 (2) SC 69,1 had the occasion to dealwith this controversy in Eastman Kodak Company v. M/s. Af. R. Electronics and Ors. 1994 III Apex Decisions (Delhi) 927. ( 5 ). The intention of the Legislature in enacting this provision was not to burdenthe plaintiff with Court fee to be paid on an amount which is unspecified andunascertained. As it would be only fair to have Court fee paid by the plaintiff onamount which the plaintiff feels in his bona fide and reasonable belief to be theamount at which he assesses the value of the relief so that he can ultimately pay theamount of actual Court fee after rendition of account when a decree in terms thereofis passed. But it does not give the plaintiff a right to undervalue the relief, put up anarbitrary or ridiculously low amount in order to escape the payment of Court fee atthe time of institution of the suit. ( 6 ). But it does not give the plaintiff a right to undervalue the relief, put up anarbitrary or ridiculously low amount in order to escape the payment of Court fee atthe time of institution of the suit. ( 6 ). The Supreme Court in M/s. Commercial Aviation and Travel Co. (supra) also observed thus:- "we are also of the view that the plaintiff cannot whimsically choose aridiculous figure for filing the suit most arbitrarily where there are positivematerials and/or objective standards of valuation of the relief appearing onthe face of the plaint. These materials or objective standards will also enablethe Court to determine the valution for the purpose of Order VII, Rule 11 (b) ofthe Code of Civil Procedure. Indeed, in Abdul Hamid Shamsi s case, it hasbeen noticed by this Court that the plaintiff has laid a claim to a sum of Rs. 1. 26,796. 72, besides another sum of over Rs. 84,000. 00 as his share in the profitfor a particular period by reference to the proceeding of the Income-taxdepartment mentioned in paragraph II of the plaint. Further, a copy of theprofit and loss account for the calendar year 1979 was annexed by the plaintiffto the additional affidavit filed on his behalf before this Court, which also gavepositive indication as to the valuation of the relief. The plaintiff in that casevalued the suit without making any reference whatsoever to those materials orobjective standards available to him and in the context of these facts, this Courtmade the above observation. But, if there be no material or objective standard,the plaintiff s valuation has to be accepted. "thus, I am also of the view that the plaintiff can not whimsically choose a ridiculouslylow figure for filing the suit and artificially give pecuniary jurisdiction to this Court. In the plaint before me in sub-para (iv) of para 14 the plaintiff has valued the relieffor rendition of accounts at Rs. 200. 00 and a Court fees of Rs. 20. 00 has been affixedthereon and for purpose of jurisdiction the same has been valued at Rs. 5,50,000. 00with averment that the said amount could be found due on renditon of accounts onprofits by the defendants. 200. 00 and a Court fees of Rs. 20. 00 has been affixedthereon and for purpose of jurisdiction the same has been valued at Rs. 5,50,000. 00with averment that the said amount could be found due on renditon of accounts onprofits by the defendants. In my considered opinion the valuation for purposes ofjurisdiction is without any objective standard and that being the situation even inview of the averment made by the plaintiff in the plaint this Court has not to go intoany other material at this stage but to direct the plaintiff to make good the deficiencyin Court fees on the amount of Rs. 5,50,000. 00 within a period of one week failingwhich the plaint shall be rejected in terms of the provision of Order 7 Rule 11 of the Code of Civil Procedure.