V.S. Aggarwal, J.@mdashMahesh Chand Naliwal has filed the present suit u/s 55 of the Copyright Act, 1957 for permanent injunction against infringing of the copyright, rendition of accounts and delivery up of goods. The facts alleged are that plaintiff claims that he is software programmer and is doing the said professional work for last more than ten years. He is carrying on the business of developing, installing and maintaining software under the name and style of M/s Excelsior Software as a sole proprietor. Prior to that he was carrying on the business under his own name Mohan Chand Naliwal. Due to his hard labour he developed software useful for purposes of keeping and maintaining the financial accounts. He named the said financial accounting software as Integrated Financial Accounting Package. It was installed in the computers being used by certain other companies. The plaintiff improved, modified and changed and developed his own skills to make useful for maintaining the maintenance records of the vehicles. In 1996 plaintiff further developed, modified and maintained his previous work by his own skill. the said software was installed and right to use only a licensee with Sagar Estate. The plaintiff further modified his original work. In 1997 he was approached to develop and modify his original software to make it useful for business to chit fund. He had been able to do the same.
2. It is asserted that defendant No. 1 is the proprietor of defendant No. 2. It came in contact with the plaintiff. Defendant No. 1 approached the plaintiff that he had certain clients who were in need of software developed by the plaintiff as it was excellent to meet out the requirements of persons dealing in the business of pharmaceutical and allied products. Defendant No. 1 offered himself to allow him to do the work of marketing Pharma Integrated Financial Accounting Software for the plaintiff on sharing basis. The defendant proposed that for the orders the defendants had to bear the expenditure like conveyance, running establishment. Therefore, out of the total income the defendant was being allowed 1/3rd as expenses and 1/3rd as their share for marketing. Defendant assured that they would disclose the exact income received from individual clients because it may vary from individual to individual. The plaintiff allowed the defendants, as per the said oral agreement, to do the marketing of Pharma Integrated Financial Accounting Software. The defendants brought certain orders to use the said Pharma Integrated Financial Accounting software to the new clients through the defendants. The defendants paid the share of the plaintiff only in respect of the clients which have been shown at Seriall No. 1 to 26. Subsequently, it is alleged that defendant No. 1 became dishonest. plaintiff asserts that he is entitled to some of Rs.1,61,000/- as per 1/3rd of the total amount received by the defendants. The defendants are avoiding to make the payment. It is further alleged that he came to know that defendants have published a notice in ''Sandhy Times'' newspaper that defendant No. 1 claims to be the owner of the said accounting software. On inspection of the register maintained by Registrar, Copyrights, it was revealed that defendant through Everest Trade Mark. Delhi had filed an application for registration of Pharma Integrated Financial Accounting Software. The plaintiff filed his objections that he is the sole, absolute and exclusive owner of the said software. He had developed the same. The defendants are stated to be having no right in this regard.
3. On these broad facts, a decree for permanent injunction against the defendants, its employees is claimed to restrain them from infringing, selling, transferring or dealing with the Software Pharma Integrated Financial Accounting Software and directing then to render accounts of the sales.
4. The defendants preferred an application u/s 10 of the Civil Procedure Code. It has been asserted that before filling of the present suit by the plaintiff Mohan Chand Naliwal, the defendant had already filed on 6th January 2000 a civil suit for permanent injunction to restrain the present plaintiff from infringing, passing off, selling, modifying or dealing with the software developed by the defendant. Parties in both the suit are same and the controversy in both the suit also is the same. To avoid multiplicity of proceedings, it was prayed that the present suit may be stayed.
5. No formal reply as such has been filed to this application but certain facts were not in controversy and keeping in view the same arguments were addressed on the is 7433/200. By the present order, the said is is being disposed.
6. Section 10 of the CPC runs as under :-
Stay of suit- No court shall proceed with the trial of any suit in which the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties, or between parties under whom they or any of them claim litigating under the same title where such suit is pending in the same or any other Court in (India) having established or continued by (the Central Government) and having like jurisdiction, or before (the Supreme Court.
7. It is clear from bare perusal of the provision referred to above that the provisions of Section 10 are procedural. Subsequently instituted suit must be stayed if the matter in issue is directly and substantial in issue in the previously instituted suit between the parties. In that event, the court has little option but to stay the subsequently instituted suit.
8. Attention of the court has been drawn towards the suit filed by Rakesh Garg, defendant, against the plaintiff being suit No. 86/2000. The same is pending in this court. The said suit filed by Rakesh Garg is also for permanent injunction against infringement of copyright, rendition of accounts and delivery up of goods. It had been asserted by defendant No. 1 in the said suit filed by him that he is one of the partners in developing a software and had developed Financial Accountant also popularly known as Pharma Integrated Financial Accounting Software. Therein defendant No. 1 claims that he is the author and developer of the same and has put in his entire career in the said development. He has been in continuous touch with the licensees for purposes of installation, upgradiation, maintenance etc. of the said software. It is the exclusive property of defendant No. 1 under the provisions of Copyright Act, 1957. The plaintiff in the present suit has been paid for the work done by him. It has further been asserted that recently with malafide intentions and with a view to usurp the entire clientele of defendant No. 1 by taking advantage of the source code of the software, the plaintiff has copied, pirated and infringed the software of defendant No. 1 Defendant No. 1 Therefore claims a restraint order against the plaintiff for infringing the copyright of defendant No. 1 in the said software and from passing off the software of defendant No. 1 in a deceptive manner besides rendition of accounts.
9. It is established beyond any pale of controversy that the controversies that are arising as a result of the plaints of both the plaintiff and defendant No. 1 are identical. They are substantially the same. They are blaming each other and claim themselves for the author of of the above said software. The main controversy in both the suits is the same as to who is entitled to the said software and whose rights have been infringed.
10. Learned counsel for the plaintiff asserts that some of the reliefs that have been claimed in his suit are different as against the suit filed by Rakesh Garg. Though it is admitted that suit filed by defendant No. 1 is previously instituted suit. But in this regard the said contention for facts of the present case has to be stated to be rejected. Reasons are not far to fetch. A clever draftsman can always add a different relief but the basic controversy, as already referred to above, is similar in both the suits that are pending. The acid test which has always been accepted in such like controversies is that the decision in the earlier suit will operate as rest judicate or not in the subsequent suit. In the present case even in the suit filed by Rakesh Garg the same controversy is there. If it is held therein that present plaintiff and not Rakesh Garg is the original owner, developer and author of Pharma Integrated Financial Accounting Software, the same would operate as res judicata and that is as referred to above is the controversy between the parties. The other reliefs couched in different language would only flow from the findings in this dispute. Therefore provision of Section 10 of the CPC are clearly attracted.
11. Confronted with that position, learned counsel for the plaintiff urged vehemently that in any case the present suit should not be stayed but it should be consolidated or tried together with the earlier suit filed by defendant No. 1. He had drawn the attention of this court to different precedents. Strong reliance was placed on the decision in the case of
In fact the said court observed:
"13. .....The key words in the Section are: "the matter in issue is directly and substantially in issue" in the previously instituted suit. The words "directly and substantially in issue" are used in contradistinction to the words "incidentally or collaterally in issue". That means that the Section would apply only if there is identity of the matter in issue in both the suits meaning thereby that the whole of the subject-matter in both the proceedings is identical and not merely one of the many issues which arise for determination in the two suits. That, however, does not mean that all the issues must be identical, that is, the subject matter need not be the same in every particular."
12. Subsequently it was further analysed:
"14. ..... It is, however, a question of fact to be gathered from the pleadings of the two suits as to whether the matter in issue in the subsequently instituted suit is directly and substantially in issue in the previously instituted suit. In the present two suits the parties are the same and both the suits arise out of the very same contract. The scope of the first suit is, however, limited in that the endeavor of the plaintiff in that suit is to restrain the defendant from committing a breach of the contract. That suit, Therefore, clearly arises under the contract. Once the contract is established and there is a reasonable apprehension of the contract being broken, the plaintiff is entitled to request the court to restrain the defendant-firm from committing a breach of the contract. The subsequently instituted suit, however, proceeds on the basis that the defendant has been guilty of non-performances of the contract and, Therefore, the plaintiff company has become entitled to damages. The subsequently instituted suit also arises out of the very same contract, as its non-performance entitles the plaintiff company to sue the defendant firm in damages."
13. The principles so enunciated make it clear that the ratio decidendi of the decision still is that if the earlier instituted suit has the same controversy which is directly and substantially in issue in the subsequently instituted suit, the latter suit has to be stayed. As regards the other findings which are confined to the facts it has little application because the facts were totally different.
14. Further reliance was placed by the learned counsel for the plaintiff on the decision in the case of
15. Reliance further was placed on the decision from the Gauhati High Court in the case Kashitish Chandra Bhowmick vs. Harakchand Betals & Ors. AIR 1985 Guw 55. The Gauhati High Court held that if one of the issues is identical that is not enough to attract Section 10 of the Civil Procedure Code. What has to be seen is whether the filed of controversy is the same. To that extent indeed it would be so. But where basic issue which is the tilting factor is the same and decision as referred to above is going to operate as res judicata position of law becomes totally different. In the present case as referred to above, re-mentioning at the risk of repetition, the basic controversy is identical in both the suits.
16. Same was the view point expressed in the case of
17. Lastly, reliance was placed on the Division Bench decision of this court in the case of M/s Arijies Aluminium Udyog vs. Sudhir Batra AIR 1977 Delhi 232. The dispute therein related to trade marks. The trade mark of M/s Arjies was ARJIES, the trade mark of the respondent was ARCHIS. On 13th December, 1994 a civil suit was filed by the appellant before the court of District Judge, Delhi u/s 120 of the Trade and Merchandise Marks Act, 1958 for damages. It was alleged that appellant was proprietor of ARJIES. Another suit was filed therein the other party was alleged to have adopted the distinctive trade mark ARCHIS. The learned single Judge of this court had refused to stay the subsequently instituted suit. The appeal was dismissed. The Division Bench held that Section 10 of the CPC contemplates substantial identity of subject matter in issue. It is not the identity of main issue but the identity of the matter in issue.
18. In the present case in hand it is the identity of the matter in issue which is established. It has been referred to above in detail that both the parties claim a relief of restraint against each other from infringing the copyright or otherwise of Pharma Integrated Financial Accounting software. That is the controversy. As is apparent from perusal of both the plaints and Therefore the matter in issue is substantially the same. Necessarily the subsequently instituted suit is liable to be stayed.
19. For these reasons the application is allowed. The Civil Suit No. 1569/2000 is stayed keeping in view the provisions of Section 10 of the Code of Civil Procedure.
