Full Judgment Text
2013:BHC-OS:5572-DB
VBC 1/18 app206.12-12.6
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
O. O. C. J.
APPEAL NO.206 OF 2012
IN
NOTICE OF MOTION NO.563 OF 2007
IN
SUIT NO.272 OF 2007
WITH
NOTICE OF MOTION NO.961 OF 2012
Ashwin Management Sawani & Ors. ...Appellants.
Vs.
M/s.Raj Enterprises & Ors. ...Respondents.
....
Mr.Ravi Kadam, Senior Advocate with Mr.H.N.Thakore and Ms.Jyhoti Ghag
i/b. Thakore Jariwala and Associates for the Appellants.
Mr.V.R.Dhond, Senior Advocate with Mr.Farhan Dubhash i/b. Sita Kapadia &
Associates for Respondent No.1.
Dr.Virendra Tulzapurkar, Senior Advocate with Mr.Anil Menon and
Ms.Smruti Karande i/b. Anil Menon & Associates for Respondent
Nos.4 and 5.
.....
CORAM : DR.D.Y.CHANDRACHUD AND
A.A. SAYED, JJ.
June 12, 2013 .
ORAL JUDGMENT (PER DR.D.Y.CHANDRACHUD, J.) :
The appeal by the Third, Fourth and Eighth Defendants arises
from a judgment and order of a Learned Single Judge, dated 14 December
2011 on a motion for interlocutory reliefs.
2. The First Respondent is the original Plaintiff. The Second and
Third Respondents are the original First and Second Defendants. The
Second Defendant was a producer of a film titled “Hum Hai Rahi Pyar Ke”.
An agreement was entered into between the First and Second Defendants on
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7 February 1991, under which the Second Defendant as producer, assigned
to the First Defendant, described as World Right Controllers, sole, exclusive
and perpetual rights in the motion picture, including copyrights and rights of
distribution, exhibition and exploitation of the film. The First Defendant was to
procure and arrange for distributors of the film to the satisfaction of the
producer. The agreement provided for a guaranteed payment to the
producer, described as a minimum coverage, of a sum of Rs.1 crore for the
sale and disposal of all rights in the film, including distribution, exhibition and
exploitation for all territories of the world.
3. On 30 October 1992, an agreement was entered into between the
Plaintiff and the First Defendant to which the Second Defendant as producer
of the film, was a confirming party. The recitals to the agreement stated that
on the request of the First Defendant, the Plaintiff had agreed to assist in the
discharge of obligations of the First Defendant as World Right Controllers by
arranging for advances to the extent of an amount of Rs.45 lakhs. The
agreement provides that the First Defendant had already received an amount
of Rs.38 lakhs prior to the execution of the agreement. Clause 3 of the
agreement stipulated the consideration that was payable by the First
Defendant to the Plaintiff and was as follows:
“3. In consideration aforesaid and of the various terms
and conditions hereof the party of the First Part hereby agrees to
pay to the Party of the Second Part the following amounts:
(a) commission at the rate of 6% (six per cent) of the total
amount of coverage, as defined in clause (4) of the said
agreement, of the said picture in 35 m.m. size for all the territories
of the world and All India Home Video rights of the said picture
payable under all agreements and/or arrangements in respect of
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the grant or disposal of the rights, for the first release, of the said
picture in all the territories of the world;
(b) Overflow at the rate of 12% (Twelve per cent) of the
first overflow of Rs.35,00,000/- (Rupees Thirty Five Lakhs only)
and 50% (fifty per cent) of the further overflow of the said picture.
It is agreed that the term “overflow” in this agreement shall have
the same meaning as defined in the said agreement;
(c) 50% (fifty per cent) of all income or proceeds of and from
T.V.rights, Air and High Seas and non-commercial grant or
disposal of standard or substandard distribution rights anywhere in
India;
(d) 50% (fifty per cent) of all further net income,
recoveries and realisations of all kinds whatsoever in respect of or
arising from the said picture or any of its rights or properties and
attached thereto and that may be attached thereto for all the
territories of the world other than what is mentioned above and
other than income or proceeds from sale of Gramophone records
and cassettes of songs of the said picture.”
Clause (4) inter alia stipulated that all monies that would be received by the
Plaintiff would be appropriated firstly towards the return or recoupment of the
amounts paid and arranged to be paid to the First Defendant and thereafter
for the payment of commission and towards all costs, charges and expenses
and other monies payable to the Plaintiff under the agreement. The balance
was to be paid to the First Defendant. Under Clause (5), towards the
payment of the amount of Rs.45 lakhs, commission on coverage and towards
the share in the overflow and other amounts payable to the Plaintiff, a security
was created in favour of the Plaintiff. Under clause (5) the security created
was in respect of: (i) The film while under production as well as after
completion together with all other rights which were charged and
hypothecated; (ii) The negatives and other material of or in connection with
the film which were to be held by the laboratory in the name of the Plaintiff by
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way of pledge. In addition, it was agreed that the First Defendant (i) shall not
transfer, mortgage, charge or create any security on or dispose of the
negatives or any other rights in respect of the film or enter into any agreement
for distribution, exhibition or exploitation without the prior consent of the
Plaintiff; (ii) would not be entitled to remove negatives or prints from the
laboratory or issue instructions for removal of the prints without the consent
of the Plaintiff. The First Defendant covenanted in clause (8) of the
agreement that the amounts due and payable to the Plaintiff, including Rs.45
lakhs, the commission, costs, charges and expenses and other monies would
be paid by 31 May 1993, which was to be the due date. Clause (8) provided
as follows:
“8. The party of the First Part hereby covenants to pay to
the Party of the Second Part the said sum of Rs.45,00,000/- and
commission at the rate of 6% of the total amount of coverage of
the said picture as mentioned in clause 3(a) above and all costs,
charges and expenses and other moneys, if any, payable to the
Party of the Second Part by virtue of this agreement on or before
st
31 May 1993, hereinafter referred to as “the due date”. It is
agreed that out of the said sum of Rs.45,00,000/- the Party of the
Second Part shall retain with themselves the amounts advanced
by them and pay off the remaining amounts to such third parties
from whom any advances are arranged by the Party of the
Second Part in terms of this agreement. The Party of the First
Part may pay to such third parties directly the said advances
arranged by the Party of the Second Part in terms of this
agreement.”
The First Defendant was not liable to pay interest on the sum of Rs.45 lakhs
until the due date, after which, interest became payable at the rate of 18% per
annum.
4. A suit was instituted by the Plaintiff seeking the following reliefs: (i)
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A permanent injunction restraining the First and Second Defendants from
assigning or granting any licence in respect of or dealing with or disposing of
or exploiting the film or any of its copyrights or other rights, including satellite
rights, Pay TV rights, DBS, DTH and Cable TV rights; (ii) An injunction
restraining the Third, Fourth, Fifth, Sixth and Eighth Defendants from
assigning or transferring satellite rights purported to have been acquired by
them and from exhibiting the satellite rights or any other rights; (iii)
Impounding, seizing and delivering up and destroying by and under the orders
and directions of the Court material relating to the film in the possession,
power or control of the Third, Fourth, Fifth, Sixth and Eighth Defendants; (iv) A
decree against the Third, Fourth, Fifth, Sixth and Eighth Defendants to pay
over to the Plaintiff the consideration received for the alleged assignment of
the film; (v) For accounts and other consequential reliefs.
5. The Plaintiff has restricted its claim in the suit to satellite rights,
Pay TV rights, DBS, DTH and Cable TV rights claimed by an entity by the
name of Kunal Overseas and by the Fourth, Fifth, Sixth and Eighth
Defendants. According to the Plaintiff, the agreement dated 30 October 1992
was modified by an arrangement recorded by a letter dated 15 April 1993.
The Plaintiff has averred that the picture negatives and sound negatives were
transferred in its name with effect from 19 September 1992 following which it
was constituted as Negative Rights Holders. The film was released on 23
July 1993. The Plaintiff claimed that in view of the terms of the agreement,
the First Defendant was not entitled to deliver prints for the purposes of
exploitation of any of the rights. On 18 December 1995, it was agreed
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between the Plaintiff and the First and Second Defendants that the negatives
and all other material pertaining to the film should be transferred in the name
of the Plaintiff and the First Defendant and that all instructions for delivery of
the prints would be acted upon by the laboratory (the Seventh Defendant)
only if issued by the Plaintiff and the First Defendant jointly. This was
recorded in a joint communication to the Seventh Defendant. On 19 April
2002, a public notice was issued by the Fifth Defendant in a Film Weekly
stating that it had negotiated to acquire from Kunal Overseas certain rights in
respect of the film. The Plaintiff objected on 23 April 2002 contending that
Kunal Overseas had no right in respect of the film. On 29 April 2002, the
Fifth Defendant in an Advocate's reply assured the Plaintiff that it would not
conclude the deal until the matter was legally resolved between the Plaintiff
and Kunal Overseas.
6. On 1 February 2003, the Plaintiff received from the First
Defendant a statement of accounts for a share due to the Plaintiff in the
overflow for the period between 1 August 1999 and December 2002,
reflecting an amount of Rs. 3.52 lakhs as due and payable to the Plaintiff. By
a further letter dated 3 May 2003, the Plaintiff was informed that its share in
the overflow for the period between 1 August 1999 and 3 May 2003 was Rs.
10.87 lakhs. The case of the Plaintiff is that a few months before May 2006, it
was informed that the film was telecast by satellite transmission on three or
four occasions.
7. The cause of action set up in the plaint is that a fraud has been
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perpetrated on the Plaintiff by the First and Second Defendants, Kunal
Overseas, as well as by the Fourth and Fifth Defendants. According to the
Plaintiff, though the Fifth Defendant upon being apprised of the rights of the
Plaintiff, had assured it that it would not conclude any transaction for the
acquisition of satellite rights, these rights have been secretly dealt with,
keeping the Plaintiff in the dark. According to the Plaintiff, under the
agreement dated 7 February 1991 between the First and Second Defendants,
the sole, exclusive and perpetual rights in the film were assigned by the
Second Defendant to the First Defendant. The Second Defendant had hence
divested itself of all rights and was not competent to assign the satellite rights
and the transactions which have been entered into are void and
unenforceable. According to the Plaintiff, the covenants in the agreement
dated 7 February 1991 continue to subsist and are valid and binding and the
Second Defendant was not entitled to create any security on the rights in the
film or to deal with or dispose of the satellite rights. The Plaintiff has
submitted that the covenants contained in the agreement dated 30 October
1992 are valid and binding and the First and Second Defendants were not
entitled to create any security in favour of Kunal Overseas and the Fourth
Respondent in respect of the rights in the film. The assignment of satellite
right is, hence, claimed to be unlawful. The plaint has been amended so as to
impugn the further dealings that have taken place in respect of the rights in
the film.
8. When the motion came up for hearing before the Learned Single
Judge, a preliminary objection was raised on behalf of the Fifth Defendant on
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the ground that the suit is barred by limitation. Accordingly, a preliminary issue
was framed in view of the provisions of Section 9A of the Code of Civil
Procedure, 1908. The Learned Single Judge answered the preliminary issue
by holding that the suit was within limitation. With the consent of Counsel, the
motion was thereafter heard on merits and a common judgment has been
delivered dealing with the preliminary issue and the merits of the motion. The
Learned Single Judge has made the Notice of Motion absolute in terms of
prayer clauses (a), (b), ( c), (e) and (e1). Briefly stated, the reliefs which have
been granted by the Learned Single Judge are as follows: (i) An injunction
restraining the First and Second Defendants from assigning or granting any
licence in respect of or transferring or exploiting the film or any of its
copyrights or other rights, including satellite rights, Pay TV rights, DBS, DTH
and Cable TV rights and delivering the prints or copies of the film to the
Fourth, Fifth, Sixth and Eighth Defendants or to any other distributors without
the prior consent of the Plaintiff; (ii) An injunction restraining the Third,
Fourth, Fifth, Sixth and Eighth Defendants from assigning or transferring
satellite rights in respect of the film purported to have been acquired by them
and from exploiting those rights or any other rights in respect of the film; (iii)
An order directing that the prints, copies and material in relation to the film
which are in the possession, power and control of the Third, Fourth, Fifth,
Sixth and Eighth Defendants be impounded, seized and delivered up and
destroyed by and under the directions of the Court; (iv) A direction to the
Third, Fourth, Fifth, Sixth and Eighth Defendants to render true and faithful
accounts in respect of the telecast, exhibition, distribution and exploitation of
the film; (v) A direction to pay to the Plaintiff the amounts realized and
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recovered together with interest at 18% per annum; and (vi) A direction to
the Defendants to disclose all dealings from and after 15 May 1996 with
respect to the motion picture.
9. For convenience of reference, it would be appropriate to deal with
the issue of limitation which has been framed and answered as a preliminary
issue and the merits of the motion separately.
Preliminary issue :
10. The submission on the preliminary issue is that in substance, the
suit is for enforcement of the security which was created in favour of the
Plaintiff without claiming a money decree. The submission is that the Plaintiff
ought to have instituted a suit for the enforcement of the security within three
years of the due date prescribed in the agreement which is 31 May 1993. The
Plaintiff is – it has been urged - not the owner of the copyright and the claim
for enforcement of the security is hence barred by limitation.
11. In order to answer the issue of limitation, it is necessary to
comprehend the case of the Plaintiff on a reading of the plaint as a whole. It
is with that object that we have adverted to in a considerable amount of detail
to the basis of the action which has been instituted by the Plaintiff. The case
of the Plaintiff is that under the agreement dated 7 February 1991, the Second
Defendant as producer of the film assigned to the First Defendant, for a
consideration of a minimum coverage of Rs.1 crore, sole, exclusive and
perpetual rights in respect of the film, including copyrights or all other rights,
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including the right to distribute, exhibit and exploit the film for all the territories
of the world. The case of the Plaintiff is that in pursuance of the agreement
dated 30 October 1992 that it entered into with the First Defendant and to
which the Second Defendant was a confirming party, the Plaintiff was entitled
to the payment of various amounts, including (i) Commission at the rate of six
percent in respect of the first release of the film; (ii) Overflow as stipulated in
clause 3(b); (iii) Fifty percent of all income or proceeds of the nature stipulated
in clause 3(c); and (iv) Fifty percent of all further net income, recoveries and
realizations of all kinds whatsoever in respect of or arising from the picture or
any of its rights or properties attached thereto and that may be attached
thereto for all the territories of the world as stipulated in clause 3(d). The
Plaintiff has relied upon the covenants which enured to its benefit under
clause 5 of the agreement. Under those covenants, according to the Plaintiff,
the film both when it was under production as well as after completion
together with the world negative rights, copyrights and all other rights came to
be charged and hypothecated in its favour and the prints and negatives were
recorded in its name by way of a pledge. According to the Plaintiff, the First
and Second Defendants could not have transferred or created any right in
respect of the film and its prints without the prior consent in writing of the
Plaintiff. The case of the Plaintiff is that though the Second Defendant had
divested itself of all its rights by the first agreement dated 7 February 1991, a
fraud has been perpetrated upon the Plaintiff by the subsequent dealings with
the film to the detriment of the Plaintiff. These averments in the plaint would
indicate that the suit that has been instituted, is not for the enforcement of
the security or charge which has been held by the Plaintiff. The Learned
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Single Judge has, in our view, correctly adverted to the averments in the
plaint, the nature of the claim in the suit and to the reliefs which have been
claimed. The case of the Plaintiff is that it was kept in the dark in relation to
the subsequent dealings with the film and that there were collusive dealings
on the part of the Defendants by the creation of rights in favour of Defendants
3 to 6 and 8. No written statement has been filed by those Defendants and
the averments against them remained to be controverted. Even as against
the Fifth Defendant, the Plaintiff has, in the amendment which was made by
the insertion of paragraph 20A of the Plaint, referred to the purported
agreement in favour of the Fifth Defendant which was alleged to have been
clandestinely entered into in order to deprive the Plaintiff of the right which
was created in its favour. Both before the Learned Single Judge and in
appeal before this Court, it has not been submitted or even urged that the
Plaintiff was made aware of the rights which have been created in favour of
the Fifth Defendant.
12. In this view of the matter, the basis and foundation of the
submission on the issue of limitation that was urged on behalf of the original
Fifth Defendant is erroneous. Clearly the suit is not barred by limitation and
the Learned Single Judge was not in error in coming to that conclusion.
Merits of the Motion :
13. On merits, it has been urged on behalf of the Appellants that: (i)
The Plaintiff is not the owner of the copyright in the film; (ii) The right of the
Plaintiff under its agreement dated 30 October 1992 was to enforce the
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charge which was created in its favour; and (iii) The Plaintiff has failed to
institute proceedings within a period of three years for the enforcement of the
charge of the due date of 31 May 1993. In sum and substance, the judgment
has been sought to be assailed on the ground that the agreement between
the Plaintiff and the First Defendant constituted a financial transaction under
which in pursuance of the monies which were lent and advanced by the
Plaintiff in the amount of Rs.45 lakhs, a series of rights was conferred upon
the Plaintiff by way of security. According to the Appellants, clause 8 of the
agreement stipulated that the amounts, which were due and payable under
the agreement, fell due on 31 May 1993 and the rights of the Plaintiff stood
crystalised on that day. The Plaintiff, it has been submitted, chose to stand by
thereafter and is disentitled to reliefs.
14. While dealing with those submissions, it would, for the purposes of
a prima facie evaluation, be necessary to construe the terms of the agreement
dated 30 October 1992 between the Plaintiff and the First Defendant. The
agreement contemplated that the Plaintiff had agreed to assist the First
Defendant in the discharge of its obligation as World Right Controllers to the
Second Defendant which was producing a motion picture. Evidently, the
production of the motion picture was not complete on the date of the
agreement and it is not in dispute that the film was released on 23 July 1993.
Clause 3 of the agreement stipulated that in consideration of the assistance
that was rendered by the Plaintiff to the First Defendant, the First Defendant
agreed to pay to the Plaintiff the amounts as reflected therein. These amounts
included: (i) Commission at the rate of six percent of the total amount of
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coverage for all territories of the world and All India Home Video Rights with
the first release of the picture; (ii) The payment of overflow at the rate of
twelve percent for the first overflow of Rs.35 lakhs and fifty percent of the
further overflow; (iii) Fifty percent of all income or proceeds of and from TV
rights, Air and High Seas and non-commercial grant or disposal of distribution
rights; and (iv) Fifty percent of all further net income, recoveries and
realizations “of all kinds whatsoever”. Clause 3(d) contemplates the payment
of fifty percent of “all further net income”. The expression “further” would
clearly mean income which was to be realised in future. This also covers
“recoveries and realisations of all kinds whatsoever in respect of or arising
from the said picture or any of its rights or properties and attached thereto and
that may be attached thereto for all the territories of the world”. These are
words of the widest amplitude and were designedly introduced by the parties.
A business sense would have to be attributed to those words in order to
read the agreement in consonance with the business understanding between
the parties. The Learned Single Judge was correct in holding that if the intent
of the parties was that the Plaintiff was to be entitled only to the amount of
Rs.45 lakhs or if parties intended that the rights of the Plaintiff would be
crystalised on the due date of 31 May 1993, the agreement would have been
differently worded. Clause 3 of the agreement has to be harmoniously
construed with the provisions of Clause 8. The film was under production
when the agreement was entered into and was released on 23 July 1993
which is after the due date of 31 May 1993 mentioned in Clause 8. The
contention of the Appellants would lead to an absurd conclusion, as a result
of which the Plaintiff could expect no more than a return of the amount of
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Rs.45 lakhs together with interest after the due date. Prima facie the due date
of 31 May 1993 was for the repayment of the amount of Rs.45 lakhs. This is
evident from the fact that the agreement itself stipulated that the interest
should be payable from the due date until payment.
15. The contemporaneous conduct of the parties is a matter of
significance because it throws light on the manner in which parties
themselves construed the agreement. On 18 December 1995, a
communication was addressed by the Plaintiff to the laboratory which was
holding the prints of the film by which the laboratory was informed that the
negatives, positives and all other materials of or pertaining to the film should
be transferred to the joint names of the Plaintiff and the First Defendant. The
letter which is addressed by the Plaintiff and which was confirmed by the First
and Second Defendants also provided that all instructions pertaining to the
film, including deliveries of prints should be acted upon only if they were
issued jointly by the Plaintiff and the First Defendant and that neither the
Plaintiff nor the First Defendant would be entitled to remove the negatives or
any other material or deal with or dispose of the same without the prior
consent of both the parties. Parties understood in that communication that
neither of them would be entitled to deal with or dispose of the picture or any
of its rights without the prior consent in writing of the Plaintiff and the First
Defendant. If the Plaintiff was not entitled to any further amounts after the
due date of 31 May 1993, there would have been no occasion to address
such a communication. On 16 May 1996, a letter was addressed by the
Laboratory to the Plaintiff and the First Defendant stating and confirming that
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it had in its records transferred the final picture and negatives to the joint
names of the Plaintiff and the First Defendant and that in future all instructions
would have to be issued jointly by the parties in writing. Parties therefore,
understood that the Plaintiff would be entitled to the benefit of the covenants
contained in the agreement even after 31 May 1993.
16. After the film was released, the Plaintiff addressed a notice on 23
April 2002 through its Advocate to the Fifth Defendant recording that under its
agreement dated 30 October 1992, the Plaintiff had a first and paramount
charge and lien on the picture then produced or that may be produced
thereafter. The Plaintiff while relying upon the terms of its own agreement
denied that Kunal Overseas had any right or interest in the motion picture and
placed on record that it had not furnished any consent for the assignment or
transfer of any rights whatsoever. In response, the Fifth Defendant by its
reply dated 29 April 2002 informed the Plaintiff that it shall not conclude any
deal with Kunal Overseas until the matter is legally resolved between the
Plaintiff and Kunal Overseas. Despite this, it is evident prima face, that the
rights in respect of the film were dealt with to the detriment of the Plaintiff and
without the consent of the Plaintiff.
17. On 1 February 2003, the First Defendant furnished to the Plaintiff
a statement of account for the share of the overflow due to the Plaintiff
between 1 August 1999 and December 2002, which showed that an amount
of Rs. 3.52 lakhs was due and payable. The First Defendant assured the
Plaintiff that the payment which had been delayed would be effected within a
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period of one month. By a further communication dated 3 May 2003, the First
Defendant informed the Plaintiff that its share in the overflow for the period 1
August 1999 to 3 May 2003 was Rs. 10.87 lakhs for which payment would
shortly be made. These letters which have been addressed by the First
Defendant clearly militate against the submission that the rights of the Plaintiff
stood crystalised on 31 May 1993, after which the Plaintiff was not entitled to
any further sum. On 15 July 2006, a letter was addressed by the Plaintiff to
the First and Second Defendants recording that it had been agreed between
the parties that a payment of Rs.50 lakhs was to be made to the Plaintiff by
the First Defendant inter alia for the losses suffered by the Plaintiff on account
of the aforesaid decision not finalising the transactions for sale of satellite
rights of the film to Zee Telefilms Limited and Software Suppliers International
Limited for the Asian Region and for the whole world. Paragraph (f) of the
letter stipulated that the agreement dated 31 October 1992 would stand
modified by the letter and would continue to be in full force as modified. The
First and Second Defendants confirmed their acceptance at the foot of the
letter. The submission of the Appellants that the Plaintiff was not entitled to
any amount after 31 May 1993 is, therefore, clearly belied by the clear and
consistent course of conduct of the parties.
18. For these reasons we have come to the conclusion that on the
basis of the material on the record, the Plaintiff made out a strong prima facie
case for the grant of interlocutory reliefs. The rights which enured to the
benefit of the Plaintiff under its agreement dated 30 October 1992 were within
the knowledge of the Defendants. In breach of those rights, the Defendants
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created rights among themselves in respect of different aspects of the picture
and for different periods. The Learned Single Judge has recorded that the
facts as disclosed indicate that some of the Defendants have in turn
transferred some of their rights for certain periods to parties who are not
before the Court. Hence, the Single Judge clarified that their rights will not be
affected in any manner whatsoever. Liberty has, however, been granted to
apply for reliefs in respect of the other prayers after giving notice to and/or
impleading or adopting proceedings against those third parties. The balance
of convenience was clearly in favour of the Plaintiff and it is evident that
irreparable injury would be caused unless the rights of the Plaintiff are
protected by an injunctive order. We, however, find on perusing the record
that the relief which has been granted in terms of prayer clause (e) by the
Learned Single Judge is in the following terms:
rd
“(e) that pending the hearing and final disposal of the suit, the 3 ,
th th th th
4 , 5 , 6 and 8 Defendants may be directed to render true and
faithful accounts to the Plaintiffs in respect of telecast, exhibition,
distribution and exploitation of the said picture and recoveries
made/to be made by them in relation thereto and be ordered and
directed to pay to the Plaintiffs the amounts realized and
recovered as per the said accounts together with interest at 18%
p.a. till payment and realization.” (emphasis supplied)
The latter part of prayer (e) directing the Third to Sixth and Eighth Defendants
to pay to the Plaintiff the amounts realised and recovered together with
interest would not be warranted at the interim stage. The aforesaid direction
for payment together with interest shall hence stand set aside. We, however,
confirm the grant of reliefs by the Learned Single Judge in terms of prayer
clauses (a), (b), ( c), (e) (with the modification noted above) and (e-1).
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19. The appeal shall accordingly stand disposed of. There shall be no
order as to costs.
20. In view of the disposal of the appeal, the Notice of Motion in the
appeal does not survive and is hence, disposed of.
( Dr.D.Y.Chandrachud, J.)
( A.A. Sayed, J. )
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
O. O. C. J.
APPEAL NO.206 OF 2012
IN
NOTICE OF MOTION NO.563 OF 2007
IN
SUIT NO.272 OF 2007
WITH
NOTICE OF MOTION NO.961 OF 2012
Ashwin Management Sawani & Ors. ...Appellants.
Vs.
M/s.Raj Enterprises & Ors. ...Respondents.
....
Mr.Ravi Kadam, Senior Advocate with Mr.H.N.Thakore and Ms.Jyhoti Ghag
i/b. Thakore Jariwala and Associates for the Appellants.
Mr.V.R.Dhond, Senior Advocate with Mr.Farhan Dubhash i/b. Sita Kapadia &
Associates for Respondent No.1.
Dr.Virendra Tulzapurkar, Senior Advocate with Mr.Anil Menon and
Ms.Smruti Karande i/b. Anil Menon & Associates for Respondent
Nos.4 and 5.
.....
CORAM : DR.D.Y.CHANDRACHUD AND
A.A. SAYED, JJ.
June 12, 2013 .
ORAL JUDGMENT (PER DR.D.Y.CHANDRACHUD, J.) :
The appeal by the Third, Fourth and Eighth Defendants arises
from a judgment and order of a Learned Single Judge, dated 14 December
2011 on a motion for interlocutory reliefs.
2. The First Respondent is the original Plaintiff. The Second and
Third Respondents are the original First and Second Defendants. The
Second Defendant was a producer of a film titled “Hum Hai Rahi Pyar Ke”.
An agreement was entered into between the First and Second Defendants on
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7 February 1991, under which the Second Defendant as producer, assigned
to the First Defendant, described as World Right Controllers, sole, exclusive
and perpetual rights in the motion picture, including copyrights and rights of
distribution, exhibition and exploitation of the film. The First Defendant was to
procure and arrange for distributors of the film to the satisfaction of the
producer. The agreement provided for a guaranteed payment to the
producer, described as a minimum coverage, of a sum of Rs.1 crore for the
sale and disposal of all rights in the film, including distribution, exhibition and
exploitation for all territories of the world.
3. On 30 October 1992, an agreement was entered into between the
Plaintiff and the First Defendant to which the Second Defendant as producer
of the film, was a confirming party. The recitals to the agreement stated that
on the request of the First Defendant, the Plaintiff had agreed to assist in the
discharge of obligations of the First Defendant as World Right Controllers by
arranging for advances to the extent of an amount of Rs.45 lakhs. The
agreement provides that the First Defendant had already received an amount
of Rs.38 lakhs prior to the execution of the agreement. Clause 3 of the
agreement stipulated the consideration that was payable by the First
Defendant to the Plaintiff and was as follows:
“3. In consideration aforesaid and of the various terms
and conditions hereof the party of the First Part hereby agrees to
pay to the Party of the Second Part the following amounts:
(a) commission at the rate of 6% (six per cent) of the total
amount of coverage, as defined in clause (4) of the said
agreement, of the said picture in 35 m.m. size for all the territories
of the world and All India Home Video rights of the said picture
payable under all agreements and/or arrangements in respect of
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the grant or disposal of the rights, for the first release, of the said
picture in all the territories of the world;
(b) Overflow at the rate of 12% (Twelve per cent) of the
first overflow of Rs.35,00,000/- (Rupees Thirty Five Lakhs only)
and 50% (fifty per cent) of the further overflow of the said picture.
It is agreed that the term “overflow” in this agreement shall have
the same meaning as defined in the said agreement;
(c) 50% (fifty per cent) of all income or proceeds of and from
T.V.rights, Air and High Seas and non-commercial grant or
disposal of standard or substandard distribution rights anywhere in
India;
(d) 50% (fifty per cent) of all further net income,
recoveries and realisations of all kinds whatsoever in respect of or
arising from the said picture or any of its rights or properties and
attached thereto and that may be attached thereto for all the
territories of the world other than what is mentioned above and
other than income or proceeds from sale of Gramophone records
and cassettes of songs of the said picture.”
Clause (4) inter alia stipulated that all monies that would be received by the
Plaintiff would be appropriated firstly towards the return or recoupment of the
amounts paid and arranged to be paid to the First Defendant and thereafter
for the payment of commission and towards all costs, charges and expenses
and other monies payable to the Plaintiff under the agreement. The balance
was to be paid to the First Defendant. Under Clause (5), towards the
payment of the amount of Rs.45 lakhs, commission on coverage and towards
the share in the overflow and other amounts payable to the Plaintiff, a security
was created in favour of the Plaintiff. Under clause (5) the security created
was in respect of: (i) The film while under production as well as after
completion together with all other rights which were charged and
hypothecated; (ii) The negatives and other material of or in connection with
the film which were to be held by the laboratory in the name of the Plaintiff by
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way of pledge. In addition, it was agreed that the First Defendant (i) shall not
transfer, mortgage, charge or create any security on or dispose of the
negatives or any other rights in respect of the film or enter into any agreement
for distribution, exhibition or exploitation without the prior consent of the
Plaintiff; (ii) would not be entitled to remove negatives or prints from the
laboratory or issue instructions for removal of the prints without the consent
of the Plaintiff. The First Defendant covenanted in clause (8) of the
agreement that the amounts due and payable to the Plaintiff, including Rs.45
lakhs, the commission, costs, charges and expenses and other monies would
be paid by 31 May 1993, which was to be the due date. Clause (8) provided
as follows:
“8. The party of the First Part hereby covenants to pay to
the Party of the Second Part the said sum of Rs.45,00,000/- and
commission at the rate of 6% of the total amount of coverage of
the said picture as mentioned in clause 3(a) above and all costs,
charges and expenses and other moneys, if any, payable to the
Party of the Second Part by virtue of this agreement on or before
st
31 May 1993, hereinafter referred to as “the due date”. It is
agreed that out of the said sum of Rs.45,00,000/- the Party of the
Second Part shall retain with themselves the amounts advanced
by them and pay off the remaining amounts to such third parties
from whom any advances are arranged by the Party of the
Second Part in terms of this agreement. The Party of the First
Part may pay to such third parties directly the said advances
arranged by the Party of the Second Part in terms of this
agreement.”
The First Defendant was not liable to pay interest on the sum of Rs.45 lakhs
until the due date, after which, interest became payable at the rate of 18% per
annum.
4. A suit was instituted by the Plaintiff seeking the following reliefs: (i)
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A permanent injunction restraining the First and Second Defendants from
assigning or granting any licence in respect of or dealing with or disposing of
or exploiting the film or any of its copyrights or other rights, including satellite
rights, Pay TV rights, DBS, DTH and Cable TV rights; (ii) An injunction
restraining the Third, Fourth, Fifth, Sixth and Eighth Defendants from
assigning or transferring satellite rights purported to have been acquired by
them and from exhibiting the satellite rights or any other rights; (iii)
Impounding, seizing and delivering up and destroying by and under the orders
and directions of the Court material relating to the film in the possession,
power or control of the Third, Fourth, Fifth, Sixth and Eighth Defendants; (iv) A
decree against the Third, Fourth, Fifth, Sixth and Eighth Defendants to pay
over to the Plaintiff the consideration received for the alleged assignment of
the film; (v) For accounts and other consequential reliefs.
5. The Plaintiff has restricted its claim in the suit to satellite rights,
Pay TV rights, DBS, DTH and Cable TV rights claimed by an entity by the
name of Kunal Overseas and by the Fourth, Fifth, Sixth and Eighth
Defendants. According to the Plaintiff, the agreement dated 30 October 1992
was modified by an arrangement recorded by a letter dated 15 April 1993.
The Plaintiff has averred that the picture negatives and sound negatives were
transferred in its name with effect from 19 September 1992 following which it
was constituted as Negative Rights Holders. The film was released on 23
July 1993. The Plaintiff claimed that in view of the terms of the agreement,
the First Defendant was not entitled to deliver prints for the purposes of
exploitation of any of the rights. On 18 December 1995, it was agreed
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between the Plaintiff and the First and Second Defendants that the negatives
and all other material pertaining to the film should be transferred in the name
of the Plaintiff and the First Defendant and that all instructions for delivery of
the prints would be acted upon by the laboratory (the Seventh Defendant)
only if issued by the Plaintiff and the First Defendant jointly. This was
recorded in a joint communication to the Seventh Defendant. On 19 April
2002, a public notice was issued by the Fifth Defendant in a Film Weekly
stating that it had negotiated to acquire from Kunal Overseas certain rights in
respect of the film. The Plaintiff objected on 23 April 2002 contending that
Kunal Overseas had no right in respect of the film. On 29 April 2002, the
Fifth Defendant in an Advocate's reply assured the Plaintiff that it would not
conclude the deal until the matter was legally resolved between the Plaintiff
and Kunal Overseas.
6. On 1 February 2003, the Plaintiff received from the First
Defendant a statement of accounts for a share due to the Plaintiff in the
overflow for the period between 1 August 1999 and December 2002,
reflecting an amount of Rs. 3.52 lakhs as due and payable to the Plaintiff. By
a further letter dated 3 May 2003, the Plaintiff was informed that its share in
the overflow for the period between 1 August 1999 and 3 May 2003 was Rs.
10.87 lakhs. The case of the Plaintiff is that a few months before May 2006, it
was informed that the film was telecast by satellite transmission on three or
four occasions.
7. The cause of action set up in the plaint is that a fraud has been
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perpetrated on the Plaintiff by the First and Second Defendants, Kunal
Overseas, as well as by the Fourth and Fifth Defendants. According to the
Plaintiff, though the Fifth Defendant upon being apprised of the rights of the
Plaintiff, had assured it that it would not conclude any transaction for the
acquisition of satellite rights, these rights have been secretly dealt with,
keeping the Plaintiff in the dark. According to the Plaintiff, under the
agreement dated 7 February 1991 between the First and Second Defendants,
the sole, exclusive and perpetual rights in the film were assigned by the
Second Defendant to the First Defendant. The Second Defendant had hence
divested itself of all rights and was not competent to assign the satellite rights
and the transactions which have been entered into are void and
unenforceable. According to the Plaintiff, the covenants in the agreement
dated 7 February 1991 continue to subsist and are valid and binding and the
Second Defendant was not entitled to create any security on the rights in the
film or to deal with or dispose of the satellite rights. The Plaintiff has
submitted that the covenants contained in the agreement dated 30 October
1992 are valid and binding and the First and Second Defendants were not
entitled to create any security in favour of Kunal Overseas and the Fourth
Respondent in respect of the rights in the film. The assignment of satellite
right is, hence, claimed to be unlawful. The plaint has been amended so as to
impugn the further dealings that have taken place in respect of the rights in
the film.
8. When the motion came up for hearing before the Learned Single
Judge, a preliminary objection was raised on behalf of the Fifth Defendant on
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the ground that the suit is barred by limitation. Accordingly, a preliminary issue
was framed in view of the provisions of Section 9A of the Code of Civil
Procedure, 1908. The Learned Single Judge answered the preliminary issue
by holding that the suit was within limitation. With the consent of Counsel, the
motion was thereafter heard on merits and a common judgment has been
delivered dealing with the preliminary issue and the merits of the motion. The
Learned Single Judge has made the Notice of Motion absolute in terms of
prayer clauses (a), (b), ( c), (e) and (e1). Briefly stated, the reliefs which have
been granted by the Learned Single Judge are as follows: (i) An injunction
restraining the First and Second Defendants from assigning or granting any
licence in respect of or transferring or exploiting the film or any of its
copyrights or other rights, including satellite rights, Pay TV rights, DBS, DTH
and Cable TV rights and delivering the prints or copies of the film to the
Fourth, Fifth, Sixth and Eighth Defendants or to any other distributors without
the prior consent of the Plaintiff; (ii) An injunction restraining the Third,
Fourth, Fifth, Sixth and Eighth Defendants from assigning or transferring
satellite rights in respect of the film purported to have been acquired by them
and from exploiting those rights or any other rights in respect of the film; (iii)
An order directing that the prints, copies and material in relation to the film
which are in the possession, power and control of the Third, Fourth, Fifth,
Sixth and Eighth Defendants be impounded, seized and delivered up and
destroyed by and under the directions of the Court; (iv) A direction to the
Third, Fourth, Fifth, Sixth and Eighth Defendants to render true and faithful
accounts in respect of the telecast, exhibition, distribution and exploitation of
the film; (v) A direction to pay to the Plaintiff the amounts realized and
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recovered together with interest at 18% per annum; and (vi) A direction to
the Defendants to disclose all dealings from and after 15 May 1996 with
respect to the motion picture.
9. For convenience of reference, it would be appropriate to deal with
the issue of limitation which has been framed and answered as a preliminary
issue and the merits of the motion separately.
Preliminary issue :
10. The submission on the preliminary issue is that in substance, the
suit is for enforcement of the security which was created in favour of the
Plaintiff without claiming a money decree. The submission is that the Plaintiff
ought to have instituted a suit for the enforcement of the security within three
years of the due date prescribed in the agreement which is 31 May 1993. The
Plaintiff is – it has been urged - not the owner of the copyright and the claim
for enforcement of the security is hence barred by limitation.
11. In order to answer the issue of limitation, it is necessary to
comprehend the case of the Plaintiff on a reading of the plaint as a whole. It
is with that object that we have adverted to in a considerable amount of detail
to the basis of the action which has been instituted by the Plaintiff. The case
of the Plaintiff is that under the agreement dated 7 February 1991, the Second
Defendant as producer of the film assigned to the First Defendant, for a
consideration of a minimum coverage of Rs.1 crore, sole, exclusive and
perpetual rights in respect of the film, including copyrights or all other rights,
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including the right to distribute, exhibit and exploit the film for all the territories
of the world. The case of the Plaintiff is that in pursuance of the agreement
dated 30 October 1992 that it entered into with the First Defendant and to
which the Second Defendant was a confirming party, the Plaintiff was entitled
to the payment of various amounts, including (i) Commission at the rate of six
percent in respect of the first release of the film; (ii) Overflow as stipulated in
clause 3(b); (iii) Fifty percent of all income or proceeds of the nature stipulated
in clause 3(c); and (iv) Fifty percent of all further net income, recoveries and
realizations of all kinds whatsoever in respect of or arising from the picture or
any of its rights or properties attached thereto and that may be attached
thereto for all the territories of the world as stipulated in clause 3(d). The
Plaintiff has relied upon the covenants which enured to its benefit under
clause 5 of the agreement. Under those covenants, according to the Plaintiff,
the film both when it was under production as well as after completion
together with the world negative rights, copyrights and all other rights came to
be charged and hypothecated in its favour and the prints and negatives were
recorded in its name by way of a pledge. According to the Plaintiff, the First
and Second Defendants could not have transferred or created any right in
respect of the film and its prints without the prior consent in writing of the
Plaintiff. The case of the Plaintiff is that though the Second Defendant had
divested itself of all its rights by the first agreement dated 7 February 1991, a
fraud has been perpetrated upon the Plaintiff by the subsequent dealings with
the film to the detriment of the Plaintiff. These averments in the plaint would
indicate that the suit that has been instituted, is not for the enforcement of
the security or charge which has been held by the Plaintiff. The Learned
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Single Judge has, in our view, correctly adverted to the averments in the
plaint, the nature of the claim in the suit and to the reliefs which have been
claimed. The case of the Plaintiff is that it was kept in the dark in relation to
the subsequent dealings with the film and that there were collusive dealings
on the part of the Defendants by the creation of rights in favour of Defendants
3 to 6 and 8. No written statement has been filed by those Defendants and
the averments against them remained to be controverted. Even as against
the Fifth Defendant, the Plaintiff has, in the amendment which was made by
the insertion of paragraph 20A of the Plaint, referred to the purported
agreement in favour of the Fifth Defendant which was alleged to have been
clandestinely entered into in order to deprive the Plaintiff of the right which
was created in its favour. Both before the Learned Single Judge and in
appeal before this Court, it has not been submitted or even urged that the
Plaintiff was made aware of the rights which have been created in favour of
the Fifth Defendant.
12. In this view of the matter, the basis and foundation of the
submission on the issue of limitation that was urged on behalf of the original
Fifth Defendant is erroneous. Clearly the suit is not barred by limitation and
the Learned Single Judge was not in error in coming to that conclusion.
Merits of the Motion :
13. On merits, it has been urged on behalf of the Appellants that: (i)
The Plaintiff is not the owner of the copyright in the film; (ii) The right of the
Plaintiff under its agreement dated 30 October 1992 was to enforce the
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charge which was created in its favour; and (iii) The Plaintiff has failed to
institute proceedings within a period of three years for the enforcement of the
charge of the due date of 31 May 1993. In sum and substance, the judgment
has been sought to be assailed on the ground that the agreement between
the Plaintiff and the First Defendant constituted a financial transaction under
which in pursuance of the monies which were lent and advanced by the
Plaintiff in the amount of Rs.45 lakhs, a series of rights was conferred upon
the Plaintiff by way of security. According to the Appellants, clause 8 of the
agreement stipulated that the amounts, which were due and payable under
the agreement, fell due on 31 May 1993 and the rights of the Plaintiff stood
crystalised on that day. The Plaintiff, it has been submitted, chose to stand by
thereafter and is disentitled to reliefs.
14. While dealing with those submissions, it would, for the purposes of
a prima facie evaluation, be necessary to construe the terms of the agreement
dated 30 October 1992 between the Plaintiff and the First Defendant. The
agreement contemplated that the Plaintiff had agreed to assist the First
Defendant in the discharge of its obligation as World Right Controllers to the
Second Defendant which was producing a motion picture. Evidently, the
production of the motion picture was not complete on the date of the
agreement and it is not in dispute that the film was released on 23 July 1993.
Clause 3 of the agreement stipulated that in consideration of the assistance
that was rendered by the Plaintiff to the First Defendant, the First Defendant
agreed to pay to the Plaintiff the amounts as reflected therein. These amounts
included: (i) Commission at the rate of six percent of the total amount of
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coverage for all territories of the world and All India Home Video Rights with
the first release of the picture; (ii) The payment of overflow at the rate of
twelve percent for the first overflow of Rs.35 lakhs and fifty percent of the
further overflow; (iii) Fifty percent of all income or proceeds of and from TV
rights, Air and High Seas and non-commercial grant or disposal of distribution
rights; and (iv) Fifty percent of all further net income, recoveries and
realizations “of all kinds whatsoever”. Clause 3(d) contemplates the payment
of fifty percent of “all further net income”. The expression “further” would
clearly mean income which was to be realised in future. This also covers
“recoveries and realisations of all kinds whatsoever in respect of or arising
from the said picture or any of its rights or properties and attached thereto and
that may be attached thereto for all the territories of the world”. These are
words of the widest amplitude and were designedly introduced by the parties.
A business sense would have to be attributed to those words in order to
read the agreement in consonance with the business understanding between
the parties. The Learned Single Judge was correct in holding that if the intent
of the parties was that the Plaintiff was to be entitled only to the amount of
Rs.45 lakhs or if parties intended that the rights of the Plaintiff would be
crystalised on the due date of 31 May 1993, the agreement would have been
differently worded. Clause 3 of the agreement has to be harmoniously
construed with the provisions of Clause 8. The film was under production
when the agreement was entered into and was released on 23 July 1993
which is after the due date of 31 May 1993 mentioned in Clause 8. The
contention of the Appellants would lead to an absurd conclusion, as a result
of which the Plaintiff could expect no more than a return of the amount of
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Rs.45 lakhs together with interest after the due date. Prima facie the due date
of 31 May 1993 was for the repayment of the amount of Rs.45 lakhs. This is
evident from the fact that the agreement itself stipulated that the interest
should be payable from the due date until payment.
15. The contemporaneous conduct of the parties is a matter of
significance because it throws light on the manner in which parties
themselves construed the agreement. On 18 December 1995, a
communication was addressed by the Plaintiff to the laboratory which was
holding the prints of the film by which the laboratory was informed that the
negatives, positives and all other materials of or pertaining to the film should
be transferred to the joint names of the Plaintiff and the First Defendant. The
letter which is addressed by the Plaintiff and which was confirmed by the First
and Second Defendants also provided that all instructions pertaining to the
film, including deliveries of prints should be acted upon only if they were
issued jointly by the Plaintiff and the First Defendant and that neither the
Plaintiff nor the First Defendant would be entitled to remove the negatives or
any other material or deal with or dispose of the same without the prior
consent of both the parties. Parties understood in that communication that
neither of them would be entitled to deal with or dispose of the picture or any
of its rights without the prior consent in writing of the Plaintiff and the First
Defendant. If the Plaintiff was not entitled to any further amounts after the
due date of 31 May 1993, there would have been no occasion to address
such a communication. On 16 May 1996, a letter was addressed by the
Laboratory to the Plaintiff and the First Defendant stating and confirming that
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it had in its records transferred the final picture and negatives to the joint
names of the Plaintiff and the First Defendant and that in future all instructions
would have to be issued jointly by the parties in writing. Parties therefore,
understood that the Plaintiff would be entitled to the benefit of the covenants
contained in the agreement even after 31 May 1993.
16. After the film was released, the Plaintiff addressed a notice on 23
April 2002 through its Advocate to the Fifth Defendant recording that under its
agreement dated 30 October 1992, the Plaintiff had a first and paramount
charge and lien on the picture then produced or that may be produced
thereafter. The Plaintiff while relying upon the terms of its own agreement
denied that Kunal Overseas had any right or interest in the motion picture and
placed on record that it had not furnished any consent for the assignment or
transfer of any rights whatsoever. In response, the Fifth Defendant by its
reply dated 29 April 2002 informed the Plaintiff that it shall not conclude any
deal with Kunal Overseas until the matter is legally resolved between the
Plaintiff and Kunal Overseas. Despite this, it is evident prima face, that the
rights in respect of the film were dealt with to the detriment of the Plaintiff and
without the consent of the Plaintiff.
17. On 1 February 2003, the First Defendant furnished to the Plaintiff
a statement of account for the share of the overflow due to the Plaintiff
between 1 August 1999 and December 2002, which showed that an amount
of Rs. 3.52 lakhs was due and payable. The First Defendant assured the
Plaintiff that the payment which had been delayed would be effected within a
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period of one month. By a further communication dated 3 May 2003, the First
Defendant informed the Plaintiff that its share in the overflow for the period 1
August 1999 to 3 May 2003 was Rs. 10.87 lakhs for which payment would
shortly be made. These letters which have been addressed by the First
Defendant clearly militate against the submission that the rights of the Plaintiff
stood crystalised on 31 May 1993, after which the Plaintiff was not entitled to
any further sum. On 15 July 2006, a letter was addressed by the Plaintiff to
the First and Second Defendants recording that it had been agreed between
the parties that a payment of Rs.50 lakhs was to be made to the Plaintiff by
the First Defendant inter alia for the losses suffered by the Plaintiff on account
of the aforesaid decision not finalising the transactions for sale of satellite
rights of the film to Zee Telefilms Limited and Software Suppliers International
Limited for the Asian Region and for the whole world. Paragraph (f) of the
letter stipulated that the agreement dated 31 October 1992 would stand
modified by the letter and would continue to be in full force as modified. The
First and Second Defendants confirmed their acceptance at the foot of the
letter. The submission of the Appellants that the Plaintiff was not entitled to
any amount after 31 May 1993 is, therefore, clearly belied by the clear and
consistent course of conduct of the parties.
18. For these reasons we have come to the conclusion that on the
basis of the material on the record, the Plaintiff made out a strong prima facie
case for the grant of interlocutory reliefs. The rights which enured to the
benefit of the Plaintiff under its agreement dated 30 October 1992 were within
the knowledge of the Defendants. In breach of those rights, the Defendants
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created rights among themselves in respect of different aspects of the picture
and for different periods. The Learned Single Judge has recorded that the
facts as disclosed indicate that some of the Defendants have in turn
transferred some of their rights for certain periods to parties who are not
before the Court. Hence, the Single Judge clarified that their rights will not be
affected in any manner whatsoever. Liberty has, however, been granted to
apply for reliefs in respect of the other prayers after giving notice to and/or
impleading or adopting proceedings against those third parties. The balance
of convenience was clearly in favour of the Plaintiff and it is evident that
irreparable injury would be caused unless the rights of the Plaintiff are
protected by an injunctive order. We, however, find on perusing the record
that the relief which has been granted in terms of prayer clause (e) by the
Learned Single Judge is in the following terms:
rd
“(e) that pending the hearing and final disposal of the suit, the 3 ,
th th th th
4 , 5 , 6 and 8 Defendants may be directed to render true and
faithful accounts to the Plaintiffs in respect of telecast, exhibition,
distribution and exploitation of the said picture and recoveries
made/to be made by them in relation thereto and be ordered and
directed to pay to the Plaintiffs the amounts realized and
recovered as per the said accounts together with interest at 18%
p.a. till payment and realization.” (emphasis supplied)
The latter part of prayer (e) directing the Third to Sixth and Eighth Defendants
to pay to the Plaintiff the amounts realised and recovered together with
interest would not be warranted at the interim stage. The aforesaid direction
for payment together with interest shall hence stand set aside. We, however,
confirm the grant of reliefs by the Learned Single Judge in terms of prayer
clauses (a), (b), ( c), (e) (with the modification noted above) and (e-1).
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19. The appeal shall accordingly stand disposed of. There shall be no
order as to costs.
20. In view of the disposal of the appeal, the Notice of Motion in the
appeal does not survive and is hence, disposed of.
( Dr.D.Y.Chandrachud, J.)
( A.A. Sayed, J. )
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