TaxTMI 
TaxTMI 
2014 (1) TMI 1115
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....ive in India and countries in SAARC region for a multinational company, Commerce One which was a global leader and pioneer in the business of E-commerce solution. The promoters of Commerce One were some of the largest companies in the world, which include SAP which is the second largest software company in the world. Through its products, portals and services, Commerce One creates access to worldwide markets, allow anyone to buy from anyone, at anytime from anywhere. Commerce One specializes in automating the process of buying and selling thereby making the process more efficient. Its services extend across all industries, including vertical strategic sectors such as banking, oil and gas, metals and mining, energy, aviation, telecom and the government sector. Commerce One‟s suite of E-procurement solutions are robust and scalable. Most of the Government organizations are user of Commerce One‟s solution. The plaintiff company offered the Commerce One solution to some of the largest corporates in India in the field of energy, textile, consumer, manufacturing etc. The plaintiff was the first and only company to build State Government owned solution www.fuelxs.com for buyin....
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....ing software system and had not bid for any such software system in any state of the country. An agreement dated 20th January, 2003 was executed between the plaintiff and the Applitech Tendercity.com (Pvt.) Ltd. through defendant No.2 forming an "association" and thus pursuant to the agreement the plaintiff was called upon by the defendant No.2 to provide software/ product so that other employees may get familiar with the product which was handed over to the defendant No.2 for the purpose of submitting the joint bid with the Madhya Pradesh Government. The parties agreed and undertook that Tendercity shall submit the bid to GOMP under the software of C1 India and Commerce One. Tendercity shall not at any stage of this tender (including bid, technical evaluation, commercial evaluation and award of the tender) offer any software other than the software of C1 India for the purpose of that bid. It was categorically agreed between the parties that they shall maintain confidentiality of the software during the subsistence of the agreement and one year thereafter and shall not in any manner disclose to any person, firm or enterprises by use of its own benefits. Vide agreement it was also c....
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.... under Section 11 of the Arbitration and Conciliation Act before this Court and moved an application under Section 9 of the Act seeking restrain orders against the Tendercity.com and the defendant No.2 from utilizing the electronic tendering module and electronic procurement module. Vide order dated 16th March, 2005 this Court injuncted the Respondent therein from using the software of the plaintiff in any manner whatsoever. Despite the order dated 16th March, 2005 the defendant No.2 sought to approach the I.T. Secretary, Government of Rajasthan, Department of Information Technology offering the electronic module/ procurement module with variations and adaptations to the Government of Rajasthan. The objections of the plaintiff company were brushed aside by the Government of Rajasthan and thus the plaintiff filed another application under Section 9 of the Arbitration Act wherein again an order was passed against the defendant therein restraining them from going ahead to supply of similar software to the Government of Rajasthan. Not only this, the defendant No.2 as Director/ COO of the Tendercity approached various public sectors undertakings, State Government and Central Government ....
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....w does it hold the copyright which has been infringed by the defendant No.1. In the written statement filed by the defendant No.1 the defendant No.1 has clearly pointed out distinction between two softwares i.e. of the plaintiff company and the defendant No.1 company. In the replication filed by the plaintiff company there is no denial of the distinctions between the two softwares and it is only stated that the defendant will have to demonstrate how the two softwares are different. It is contended that the plaintiff has to stand on its own legs and to prove the case the plaintiff has to prove that the software used by the defendant is identical to the software used by the plaintiff and also that the plaintiff holds the copyright in the work and thus there is infringement of the copyright of the plaintiff. In fact, the plaint does not disclose any cause of action and thus the defendant filed an application for interrogatories against the plaintiff. Vide IA 1971/2012 under Order XI Rule 1,2&4 CPC the learned Joint Registrar allowed the application directing the plaintiff to submit reply to the interrogatories at serial No. 6,7&8. However, even in the reply to the interrogatories the ....
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....m injunction against the defendant. Vide order dated 28th July, 2010 an ad interim ex-parte injunction was passed in favour of the plaintiff in terms of the prayers made in Paras „a‟ to „d‟ of the application and the defendants have been restrained from using the e-tendering/ e-procurement software of the plaintiff company or representing the same to various public sector undertakings as well as the world at large. 9. A perusal of the agreement between the plaintiff company and defendant No.2 on behalf of the Tendercity shows that the defendant No.2 undertook not to even develop a software comparable to that of the plaintiff. The defendant No.2 already suffers a decree against him in this regard. Indubitably, a company is a separate legal entity from its shareholders and thus can be sued in its own name. However, in order to avoid a mala-fide exercise and if an act of the company is prima facie meant to circumvent the orders passed by the Courts, this Court will certainly pierce the Corporate veil and find out the true position. Despite an apology being tendered before this Court on 26th November, 2007 in Contempt Petition 35/2005, an independent company i.....