Final Order 1

Order Details: Ex-parte Judgement
Pdf Text: Comm.Suit No. 195/19. 1 Ex-parte Judgment (Exh.19).
MHCC010103582019
Presented on : 09-10-2019
Registered on : 19-11-2019
Decided on : 29-10-2021
Duration : 2 years, 0 months, 20 days
IN THE BOMBAY CITY CIVIL COURT AT BOMBAY.
COMMERCIAL SUIT NO. 195 OF 2019
Exh.19.
Yaashkrishni Food Science Ltd., )
A Company duly incorporated under )
The Companies Act, 1956, )
Having its Registered Office at )
B16, Sidhpura Industrial Estate, )
Opp. L.B.S. Marg, Amrut Nagar, )
Ghatkopar [West], Mumbai – 400086; )
And having its Plant at )
R267, MIDC TTC Industrial Area, )
Rabale, Navi Mumbai – 400 701; )
Through its C.M.D., Mr. Satish Vittal Shetty, )
age 53 years, )...Plaintiff
Versus
Mrs. Swati S. Patankar, )
Proprietor Shubham Enterprises, )
1, Patankar Tower, Beside Patankar Park, )
Station Road, Nalasopara West – 401203, )
Also at )
B/101, Patankar Towers, Beside Patankar Park, )
Station Road, Nalasopara West – 401203 )...Defendant
SUIT FOR RECOVERY OF MONEY
CORAM : HIS HONOUR JUDGE SHRI R.R.BHAGWAT.
(C.R.NO.31).
DATE : 29th OCTOBER, 2021.
-- 1 of 10 --
Comm.Suit No. 195/19. 2 Ex-parte Judgment (Exh.19).
Mr. O.V.Hingorani, Advocate for the plaintiff.
Defendant – (Exparte).
JUDGMENT (EXPARTE)
1. This is suit for recovery of money.
2. Case of the plaintiff, in brief, is as under :
The plaintiff is a company incorporated under the
Companies Act, 1956. C.M.D. Shri Satish Shetty has filed the present
suit as an authorized representative of the plaintiff company. The
plaintiff is engaged in the business of manufacturing, distribution and
sale of cakes, pastries and other confectionery and bread etc. under the
registered brand and trademark 'Ribbons and Balloons'. The defendant
is the proprietor of 'Shubham Enterprises'. The plaintiff has appointed
franchises in various parts of the country. The defendant approached
the plaintiff and informed about ownership of Shop No.1 in Patankar
Tower, beside Patankar Park, Station Road, Nalasopara (West) and
expressed desire to start the shop for selling cakes, pastries etc.
Accordingly, the defendant was appointed as a Distributor of the
plaintiff company for setting up and running the retail outlet in above
referred premises as per agreement dated 16/03/2015.
3. Then, the defendant furnished the interior and exterior of
the premises in accordance with the specifications and requirements of
the plaintiff. For this purpose, the plaintiff had provided the designs of
graphics, counters, layout, signage etc. to the defendant. The plaintiff
incurred the expenses of advertising the said outlet in local papers and
other media for increasing the revenue and sales. As the plaintiff
developed brand name and built superior products and incurred
-- 2 of 10 --
Comm.Suit No. 195/19. 3 Ex-parte Judgment (Exh.19).
expenses to market the outlet, business of the defendant increased
manyfold.
4. Subsequently, termination clause 11 of the agreement was
changed by making addition in it and the defendant was prevented
from carrying out the similar business in the said premises for a period
of five years from the date of termination of the agreement and she
shall cease to exploit any intellectual property rights owned by the
plaintiff or any company related to it. Changes in the termination
clause 11 of the agreement were informed to the defendant as per letter
dated 18/11/2016 which was duly received and acknowledged at the
outlet of Shubham Enterprises on 19/11/2016.
5. Franchises were required to place orders latest by 9.00 p.m.
everyday and supplies were made on the following day. Accordingly,
the defendant continued to place orders with the plaintiff till
20/10/2018. As the defendant stopped placing orders abruptly from
21/10/2018, the staff of the plaintiff contacted the defendant. The
defendant informed them that due to personal problems, she was
keeping the outlet closed for the period of five days. When staff of the
plaintiff visited the outlet on 18/12/2018, they noticed that name of the
shop was changed to 'The Medals Cake Shop'. Layout and internal
design of the said shop was the same as the layout and designs of the
plaintiff's layout. As per the agreement, the defendant was bound to
give the notice of termination of 90 days. The said act of not placing
the orders and changing name of the shop is an act of unilateral
termination of the agreement without notice by the defendant.
6. The plaintiff issued notice dated 17/01/2019 to the
-- 3 of 10 --
Comm.Suit No. 195/19. 4 Ex-parte Judgment (Exh.19).
defendant informing her about illegal acts and unlawful violation of the
agreement resulting into loss of Rs.18,85,744/ with following
specification :
1. Loss due to stoppage of business of Rs.17,40,000/,
2. Arrears towards due amount of Rs.9,324/,
3. Expenses incurred for promotion of the outlet of Rs.21,420/,
4. Damages for illegal use of proprietary layouts and designs of
the plaintiff Rs.25,000/,
5. Damages for the breach of clause 11 of the agreement of
Rs.1,00,000/.
7. The said notice is duly served upon the defendant. The
plaintiff further calculated average purchase from June 2016 to October
2018 by the defendant amounting to Rs.62,53,011/. The defendant
earned Rs.1,52,520/ per month during this period. On the basis of this
average monthly profit, the plaintiff calculated loss of Rs.15,25,000/.
He further claimed per day loss of Rs.10,000/ for 188 days from
17/01/2019 till the date of filing of the suit. After giving all these
details, the plaintiff filed the suit for recovery of Rs.37,65,744/
[amount of Rs.18,85,744/ as per prayer clause (b) plus amount of
Rs.18,80,000/ as per prayer clause (c)]. He also sought relief of
declaration that the defendant is in breach of the agreement dated
16/03/2015. He prayed for injunction restraining the defendant and
her employees, agents etc. from conducting the business similar to the
business of the plaintiff in the said shop and also within area of one km.
radius where the outlet was located. He also claimed costs of the suit.
8. The defendant was duly served with writ of summons as
per affidavit of service (Exh.2), but she failed to appear and oppose the
-- 4 of 10 --
Comm.Suit No. 195/19. 5 Ex-parte Judgment (Exh.19).
claim of the plaintiff. Therefore, my learned Predecessor passed the ex
parte order against her on 17/02/2020.
9. PW 1 Satish Shetty deposed on evidence affidavit (Exh.3)
and proved documents filed with list of documents (Exh.5). Proved
documents are at Exh.6 to 17. The plaintiff closed evidence vide pursis
(Exh.18). Heard learned counsel Shri O.V.Hingorani for the plaintiff.
10. After considering pleadings of the plaintiff and evidence on
record, following points arose for my determination with my findings
against them with reasons to follow :
SR.NO. POINTS FINDINGS
1. Does the plaintiff prove that he is
entitled to relief of declaration that the
defendant is in breach of the agreement
dated 16/03/2015 ? In the Affirmative.
2. Does the plaintiff prove that he is
entitled to recover amount of
Rs.18,85,744/ as mentioned in prayer
clause (b) of the plaint ? In the Affirmative.
3. Does the plaintiff prove that he is
entitled to recover amount of
Rs.18,80,000/ as mentioned in prayer
clause (c) of the plaint ? Partly in the
Affirmative.
To the extent of
Rs.9,40,000/.
4. Does the plaintiff prove that he is
entitled to relief of injunction as prayed
in prayer clause (d) of the plaint ? In the Affirmative.
5. What order as to costs ? As per final order.
-- 5 of 10 --
Comm.Suit No. 195/19. 6 Ex-parte Judgment (Exh.19).
6. What order and decree ? Suit is partly
decreed.
REASONS
AS TO POINT NOS.1 TO 5 :
11. PW 1 Satish Shetty has deposed about franchises
agreement between the plaintiff and the defendant executed on
16/03/2015 as per which the defendant was appointed as a distributor
of the plaintiff company for sale of bakery products and confectionery
under the registered brand and trademark 'Ribbons & Balloons'. The
defendant had started the shop in her premises at Nalasopara (West).
PW 1 Satish Shetty has proved resolution (Exh.5) authorizing him to
represent the company in the present matter. He also proved
agreement dated 16/03/2015 (Exh.7). He further stated about setup
of the shop as per layout plan and designs of the plaintiff. Layout plan
is at Exhibit 8. Similarly, tax invoice (Exh.9) provides details of
expenses of Rs.21,420/ incurred for printing the pamphlets for
promotion and advertisement of the defendant's shop. In addition to it,
letter dated 18/11/2016 (Exh.10) is forwarded to the defendant by the
plaintiff making additions in termination clause 11 of the agreement.
Copy of the same is received by the defendant on 19/11/2016.
12. The plaintiff has also placed on record summary of orders
from June, 2018 to October, 2018 (Exh.11 colly.) and sale summary
(Exh.12 colly.). All these documents demonstrates that the defendant
had purchased the goods worth Rs.39,96,594/ during this period and it
points out proportion of overall turnover. Printout of photographs
(Exh.13 colly.) and xerox copy of bill issued by the Medals Cake Shop
(Exh.14) shows that the defendant started similar business of bakery
-- 6 of 10 --
Comm.Suit No. 195/19. 7 Ex-parte Judgment (Exh.19).
products at the place which was expected to be utilized for running
franchises shop/outlet of the plaintiff. It is in express violation of the
conditions stipulated in the agreement (Exh.7). More particularly, the
defendant did not give notice of 90 days for termination of the
agreement as per second clause under the head “Duration” in the
agreement. In addition to it, the defendant was prevented from using
the trademark and trade name without permission of the plaintiff.
Furthermore, the plaintiff has stated about the use of layout plan and
designs provided to the defendant by the plaintiff after setting up the
Medals Cake Shop in the said premises. In short, the plaintiff has
adduced on record ample evidence to prove that the defendant
committed breach of terms of the agreement.
13. It is evident from material on record that the defendant
obtained franchises of the plaintiff's shop and she succeeded in
attracting large number of customers considering turnover reflecting in
Exh.11 and 12. The defendant succeeded in exploiting the goodwill
and brand name of the plaintiff for flourishing her business.
Subsequently, she started the similar business in the same premises by
violating terms of the agreement. It is express violation of trademark
and intellectual property rights of the plaintiff company. The plaintiff is
deprived of getting further benefits as a result of conduct of the
defendant inconsistent with the agreement between the parties. The
defendant has utilized the brand name of the plaintiff for her personal
gain at the cost of financial losses to the plaintiff. The defendant has
not only unilaterally terminated the contract without intimation to the
plaintiff but also continued to carry on similar business in violation of
clause 11 of the agreement which prevents her from using the same
premises for similar business for the period of five years from the date
-- 7 of 10 --
Comm.Suit No. 195/19. 8 Ex-parte Judgment (Exh.19).
of termination of the agreement.
14. For all these reasons the plaintiff is entitled to reliefs as per
prayer clause (a), (b) and (d) of the plaint. So far as relief claimed in
prayer clause (c) for granting per day amount of Rs.10,000/ is
concerned, it is the demand inconsistent with monthly profits of
Rs.1,52,520/ earned by the defendant as pleaded in para 17 of the
plaint. Therefore, reasonable reduction is required to be done while
granting relief as per prayer clause (c). Accordingly, amount of
Rs.5,000/ per day for 188 days from 17/01/2019 till the date of filing
of the suit in lieu of damages for sale of similar products can be
granted. In the result, amount claimed in prayer clause (c) is reduced
to Rs.9,40,000/. The plaintiff has not claimed future interest in prayer
clauses of the plaint and therefore, no order as to future interest is
passed. Costs of the suit is liable to be imposed on the defendant. In
the result, I record my findings as to points no.1, 2 and 4 in the
affirmative and as to point no.3 in the partly affirmative with
modification in the amount to be paid in lieu of damages as discussed
above. Hence, I pass the following order :
ORDER
1. Commercial Suit No. 195/2019 is partly decreed.
2. It is hereby declared that the defendant is in breach of the
agreement dated 16/03/2015.
3. The defendant is directed to pay amount of Rs.18,85,744/
(Rupees Eighteen Lakhs Eightyfive Thousand Seven
Hundred Fortyfour Only) to the plaintiff within three
months from the date of decree.
4. The defendant is directed to pay amount of Rs.9,40,000/
(Rupees Nine Lakhs Forty Thousand Only) to the plaintiff
in lieu of damages for sale and supply of similar items in
-- 8 of 10 --
Comm.Suit No. 195/19. 9 Ex-parte Judgment (Exh.19).
the outlet during 17/01/2019 till the date of the suit within
three months from the date of decree.
5. The defendant, her employees, agents or any person
claiming through the defendant are hereby prevented from
conducting any business similar to the business of the
plaintiff as agreed in the agreement dated 16/03/2015
(Exh.7) from the store in Shop 1, Patankar Tower, besides
Patankar Park, Station Road, Nalasopara (West) and also
from conducting similar business as that of the plaintiff
within area of one km. radius where outlet is located for
the period of five years from the date of this decree.
6. The defendant shall bear the costs of the suit.
7. Decree be drawn up accordingly.
(R.R.BHAGWAT)
Judge,
City Civil & Sessions Court,
(Court Room No.31)
Date : 29/10/2021. Mumbai.
1. Dictated online on : 29/10/2021.
2. Signed on : 29/10/2021.
3. Delivered to Certified :
Copy Section on
“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
UPLOAD DATE AND TIME NAME OF STENOGRAPHER
29/10/2021. 5.05 p.m. Miss M.A.Kulkarni.
Name of the Judge (with Court Room no.) HHJ Shri R.R.Bhagwat.
(Court Room No.31).
Date of Pronouncement of Judgment/Order 29/10/2021.
Judgment/Order signed by P.O. on 29/10/2021.
Judgment/Order uploaded on 29/10/2021.
-- 9 of 10 --
Comm.Suit No. 195/19. 10 Ex-parte Judgment (Exh.19).
-- 10 of 10 --