The Judgment was delivered by : HON'BLE JUSTICE C. K. THAKKER
Case Facts:
Prodigy Electronics Ltd is a Hong Kong based company and engaged in the business of trading electronic goods particularly in Printed Circuit Board (PCB). Mr.Laxman Prasad was working for Prodigy Electronics Ltd since July 22, 2002 till December 20, 2004. He entered an employment contract with the Prodigy Electronics Ltd on October 2, 2003 and subsequently when he is shifted to India on September 13, 2004.
Mr.Laxman Prasad has joined another company Multi Circuit Board (CHINA) Ltd., one of the supplier companies to Prodigy Electronics Ltd and attended a Trade Fair in Delhi (Componex/Electronic India, 2005) which was held between February 1, 2005 to February 4, 2005 at Pragati Maidan, New Delhi.
Prodigy Electronics Ltd., alleged that Mr.Laxman Prasad has breached the contact entered on September 13, 2004 and has used goodwill and passed on the tradename 'Prodigy' during the Trade fair in Delhi. He has also registered a domain name 'www.prodigycircuits.com'.
Aggrieved by these acts of Mr.Laxman Prasad Prodigy Electronics Ltd., has approached Delhi High Court requesting for permanent and mandatory injunction against the defendant as also for damages by ordering rendition of accounts also requested interim injunction restraining the defendant from using the name 'Prodigy', 'Prodigy Circuit' or any other identical or deceptively similar name or from passing off any such identical or deceptively similar trade mark or trade name.
Mr.Laxman Prasad asserted that there was an agreement between the plaintiff-Company and the defendant by which exclusive jurisdiction was granted to Courts in Hong Kong and jurisdiction of all other Courts had been ousted and on that ground also Delhi Court had no jurisdiction in the matter.
Delhi High Court considered the application of the Mr.Laxman Prasad and dismissed it holding that the agreement did not take away jurisdiction of the Court as contended by him and the application had been filed only with a view to delay the progress of the suit which was liable to be dismissed and it was accordingly dismissed with costs of Rs.4, 000/-.
Aggrieved by Delhi High Court’s Order Mr.Laxman Prasad has approached honorable Supreme Court of India under this Special Leave Petition.
Issue:
Whether Delhi High Court has jurisdiction to entertain the civil suit considering the agreement between Mr. Laxman Prasad and Prodigy Electronics Ltd which specifically confers jurisdiction to Hong Kong Courts?
Holding:
The Honorable Supreme Court of India held that Delhi High Court has jurisdiction to entertain the suit.
Analysis:
The Honorable Supreme Court of India observed that 'cause of action' and 'applicability of law' are two distinct, different and independent things and one cannot be confused with the other.
The Court further observed that territorial jurisdiction of a Court, when the plaintiff intends to invoke jurisdiction of any Court in India, has to be ascertained on the basis of the principles laid down in the Code of Civil Procedure. Since a part of 'cause of action' has arisen within the local limits of Delhi that is using goodwill and passing off the tradename 'Prodigy' during the Trade fair has happened in Delhi the High Court of Delhi has the Jurisdiction.