J.B Goel, J.— By this order I will dispose of I.A No. 7411/96 filed by the plaintiff under order 39 rules 1 & 2 read with section 151 c.p.c for interim injunction and I.A No. 8466/96 under Order 39 Rule 4 read with Section 151 C.P.C filed by the defendant for vacating the ex-parte ad interim injunction granted on August 16, 1996.
2. By the interim order dated 16.8.96 the defendant was restrained from acting on behalf of Hl-:#:—I.As.7411 & 8466/96 or dealing or entering into contract with Sidel & Husky directly.
3. The plaintiff is a private limited company and carries on work inter alia as Agents and Consultants for various manufacturers for promoting their products and sale services.
4. Sidel-SA a company incorporated and registered in France, who manufacturers various types of machines including Blow Moulding machines and equipment had entered into a contract of agency dated July 28, 1994 with the plaintiff which was made effective from 1.3.1994 vide Sidel's letter dated 29.7.1994
5. One Husky Injection Moulding System SA of Luxembuourg (for short Husky) which is also manufacturer of injection moulding systems for preforms etc. had also entered into another contract of agency dated July 1, 1994.
6. The terms of both the agencies were in identical terms and the agency was for a period of 2 years with renewal clause.
7. The defendant carries on business under the name and style of High Tech Consultants and has a consultant and Manufacturers business, and it is alleged, that he has been involved in various projects and works with the plaintiff company since 1989.
8. For carrying out the work of agency for various clients including Sidel and Husky Plaintiff had a subsidiary unit known as Petequip. After these aforesaid two agency contracts were taken, the plaintiff and the defendant agreed to work on certain terms which were reduced into writing vide letter dated 30th July, 1994 on commission basis to be paid by Petequip to the defendant at the rates and terms as specified in this agreement.
9. After about a year's working of the two agencies there were some comments made by Sidel and Husky as well as by the defendant to the plaintiff about the unsatisfactory working of existing arrangement and a request was made to suitably modify the same on the terms which would be acceptable to all the parties.
10. In pursuance of these comments, it appears certain discussions took place between the Mr. Gautam Mahajan, Defendant and one Mr. Debashish Bhaduri and the proposed Understanding/arrangement arrived at between them was reduced into writing in the form of a letter on 28.7.1995 which was signed by all these three persons. This letter was sent to both Sidel and Husky. This arrangement though appreciated by Husky and Sidel in letter dated 24.8.1995 and FAX dated 28.8,1995, respectively but their acceptance was not conveyed to the other parties.
11. Article 10 of the two agency agreements between the plaintiff and Sidel and plaintiff and Husky provided for duration of the contract as under:—
“Article 10-Duration of the contract
1) This contract is valid for two years and will be renewable automatically for similar periods unless written notice of cancellation is given by either party before six months from the expiry of the contract period.”
12. And terms about extent and limits of the sole agency as agreed is contained in Article 7 which reads as under:
“Article 7-Extent and Limits of the Sole Agency.
1) In the territory granted to the Agent with exclusivity, the Manufacturer prohibits himself from ceding to anyone else the agency or the sale of equipment stipulated in the contract.
(Manufacturer means Sidel and Husky and Agent means Petequip in two contracts)
Case of the plaintiff is that the agreement between the plaintiff and Sidel was made effective from 1.3.1994 and this was valid for a period of 2 years,i.e, up to the end of February, 1996 and was automatically renewable for a similar period of 2 years unless written notice of cancellation was given by either party before 6 months of the expiry of the contract period as provided in Article 10. A notice of cancellation dated 18.12.1995 given by Sidel to the plaintiff which it is alleged was not valid as it was not of 6 months duration as the agreement of agency could be terminated by 6 months prior to expiry on 1.3.1996, i.e, on or before 1.9.1995
13. It is thus alleged that there was subsisting contract between the plaintiff and Sidel and yet the defendant informed the plaintiff vide letter dated 16.7.1996 that he was entering into a direct contract of agency with ‘Sidel’ and would work directly with them which is in complete breach of trust and in violation of the agreement as contained in letter dated 28.7.1995 and its clause 8 which provided as under:—
8. As a result of the new organization, all involved have agreed not to work directly with PETEQUIP'S clients and principals nor to compete for a period of 3 years after leaving PETEQUIP.”
14. Plaintiff has accordingly filed the present suit for a decree for permanent injunction restraining defendant directly or indirectly from dealing with or entering into any contract, agreement or understanding with any of the principals of the plaintiff including Sidel and Husky contrary to the agreement dated 28. 7.1995 for a period of 3 years commencing from 1.8.1996 and for a preliminary decree for rendition of accounts in respect of any dealings which might have taken place between the defendant and the said principals of the plaintiff.
15. Defendant has contested the claim of the plaintiff both in suit and the application. It is inter alia pleaded that the agreement dated 30.7.1994 between the plaintiff and defendant was for a period of one year from 1.8.1994 However, it was later on modified on 14.7.1995 on changed terms and was made valid for the period of one year from April 1, 1995. This agreement came to an end on 31.3.1996 and since 1.4.1996 there has been no contract or subsisting agreement between the plaintiff and the defendant. The arrangement as contained in the letter dated 28.7.1995 between the plaintiff and defendant was not a binding or enforceable and valid contract and at the most it was a contingent contract as defined under section 31 of the Indian Contract Act (For short the Contract Act) and as the terms and conditions as mentioned in this contract had not been complied with or fulfilled, it is a void and unenforceable contract in view of sections 32 and 33 of the Contract Act in as much as the arrangements contemplated in letter dated 28.7.1995 were neither implemented nor accepted by Sidel or Husky and both Sidel and Husky terminated the agency agreements of the plaintiff; Sidel w.e.f 1.8.96 and Husky w.e.f 1.7.1996 and there was no subsisting agency agreement between the plaintiff and Husky or Sidel thereafter. The mutual agreement between plaintiff and defendant having come to an end on 31.3.1996 there was no new or subsisting agreement to work together. It is also alleged that the plaintiff has concealed material fact about termination of its agency by Husky. Suit is also not maintainable under section 41(e), 41(h), 41(i) of the Specific Relief Act. The suit and the application for interim injunction are thus liable to be dismissed and the ex-parte injunction granted is also liable to be vacated.
16. Separate reply has been filed to the application.
17. I have heard the learned counsel for the parties.
18. Learned counsel for the plaintiff has contended that there were two agency agreements between the plaintiff on the one hand and Sidel and Husky on the other, as contained in agency agreements dated 28.7.1994 and 1.7.1994 both for a period of 2 years but were to be automatically renewed as contemplated under Article 10 thereof if no notice of 6 months prior to the expiry of this period was given. The agency agreement of Sidel was effective from 1.3.1994 and as the termination notice given on 18.12.1995 was not given 6 months prior to its expiry, it was automatically renewed for further two years on 1.3.1996 During the subsistence of this agency with plaintiff, by Article 7(1) of the Agency agreement Sidel was debarred from creating another agency in favour of any one else for their same business. The agreement dated 28.7.1995 between the plaintiff and defendant also provided that the parties would not work directly and indirectly with the plaintiff's clients and principals nor would compete for a period of 3 years after leaving Petequip. And as such the Agency agreement entered into between the Sidel and defendant is in violation of this specific agreement and is not legal and valid and plaintiff is entitled to protection of their rights by an injunction. Learned counsel has relied on Niranjan Shankar Golikari v. Century Spinning and Manufacturing Co. Ltd. AIR 1967 SC 1098 and Sunil Chand C. Mazumdar (orig. Defdt:) v. The Aryodaya Spg. & Wvg. Mills Co. Ltd.(Orig. Plaintiff) AIR 1964 Gujarat 115.
19. Whereas learned counsel for the defendant has contended that neither of the agency agreements with Sidel and Husky was subsisting nor there was any valid agreement between the plaintiff and the defendant; the arrangement as contained in letter dated 28.7.1995 is not valid agreement. It was a proposal or contingent contract. Its terms were not implemented and the proposals sent to Sidel and Husky were not accepted by them and so no contract came into existence. Even otherwise this is in restraint of trade by defendant and is void and not enforceable under Section 27 of the Contract Act. He has relied on Krishan Murgai… v. Superintendence Company Of India (P) Ltd.…. AIR 1979 Delhi 232; Superintendence Company Of India (P) Ltd. v. Krishan Murgai. AIR 1980 SC 1717; Taproggc Gesellschaft MBH v. I.A.E.C India Ltd. AIR 1988 Bombay. 157; Sadeev Singh Sandhu v. Turk (GmbH) Gutenbergstrassy & Anr. 1995 (35)DRJ 80 and National Advertisers v. Mysore State Road Transport Corporation AIR 1964 Mysore 220.
20. Most of the correspondence exchanged between the plaintiff and the defendant and also between the plaintiff and Sidel and Husky has been placed on record.
21. Sidel, a company registered in France, is a manufacturing company and gave the sole agency for the sale of equipments produced by it in the territory of India to the plaintiff in the name of Petequip on the terms and conditions as agreed in detailed contract of agency executed on July 28, 1994. Article 10(1) which provided duration of the contract reads as under:
Article 10-Duration of the contract
1) This contract is valid for two years and will be renewable automatically for similar periods unless written notice of cancellation is given by either party before six months from the expiry of the contract period.
Article 7(1) thereof contained clause of exclusivity which reads as under:
“Article 7 - Extent and Limits of the Sole Agency.
1) In the territory granted to the Agent with exclusivity, the Manufacturer prohibits himself from ceding to anyone else the agency or the sale of equipment stipulated in the contract. If sale results sin shipment of machine to the territory be awarded usual commission in case sale is signed outside territory.
(Agency is Petequip, a subsidiary of Interlink Services Pvt. Ltd. and Manufacturer is Sidel).
22. Letter dated 29.7.1994 from Sidel to plaintiff provided that this agreement was to be considered valid since March 1.
23. With similar terms, a separate contract of agency dated July 1, 1994 had earlier been executed between the plaintiff and Husky which, apparently came into force on its execution.
24. Defendant carries on its business in the name of High Tech Consultants at Bombay.
25. Petequip had also entered into an agreement with defendant for running this agency business on the terms and conditions as incorporated in letter dated July 30, 1994 for this purpose and it was agreed that the defendant had to work for the business of Petequip in Bombay Region on commission basis which was 33.3% of the net commission received from their principals by Petequip with a minimum retainership of Rs.60,000/- per year. It was also agreed that this agreement was valid for one year from August 1, 1994. It could be renewable every year by mutual agreement and was also terminable by serving 3 months notice by either party.
26. Terms of agreement with defendant were amended on the terms as jointly agreed in letter dated 14.7.1995 and thereby it was also agreed that the amended agreement was valid for a period of one year from April 1, 1995.
27. Sidel vide their letter dated July 6, 1995 had made some grievances about working of its agency business by Petequip. It had, however, appreciated the performance of its Bombay Office under the structural set up controlled by defendant. They made several suggestions for improvement in the working of its business in other parts of the country including Delhi.
28. Some discussions had taken place between plaintiff's Mr. Gautam Mahajan and defendant on 13.7.1995 and in his letter dated 17.7.1995 sent by defendant to the plaintiff, defendant had made several suggestions and proposals to the plaintiff for more satisfactory, smooth and purposeful working of the agency business, and also about their own inter se working. It appears that further discussions had also taken place between Gautam Mahajan, Debashish Bhaduri both of plaintiff and defendant and thereafter they had mutually agreed to certain terms for working together and also for more satisfactory working of the agency business with reorganised organizational set up. These were incorporated in a joint letter dated 28.7.1995 signed by them, namely Debashish Bhaduri, Gautam Mahajan and S.P Bangera (defendant) and all had shown concern for more satisfactory working under a new company independent of the plaintiff. This letter was sent to Sidel.
29. It appears that Husky was also not satisfied with the business of their agency with plaintiff and in the meantime they also in their letter dated 20.7.1995 sent to Petequip had conveyed their dissatisfaction and they had proposed to set up their own office in India. Another letter dated 28.7.95 in similar terms as sent to Sidel and signed by all the aforesaid three persons was sent to Husky also. Both Sidel and Husky apparently appreciated the proposal made in the said two letters dated 28.7.1995 but both do not appear to have given their express acceptance to the same. Husky again in their letter dated 24.8.1995 informed Petequip that they would open their own Regional Office in Bombay. Sidel in their FAX message on 28.8.1995 raised certain queries seeking information about working/implementing of new set up.
30. What transpired between Petequip and Sidel and Husky on the proposal as contained in letter dated 28.7.1995 thereafter no material has been placed on record by the plaintiff. It is not the case of the plaintiff that these two companies had agreed to this proposal or had agreed to continue their respective agencies in acceptance of this proposal sent by plaintiff. No mention has also been made in the plaint if agency of Husky was continued beyond its expiry on 1.7.1996 Defendant in his written statement has pleaded that Husky had terminated Agency w.e.f 1.7.1996 This fact has been admitted by the plaintiff in its replication dated 18.9,1996. It is not the case of the plaintiff that this termination was not valid for any reason. One of the grievance of the defendant is that this material fact was concealed from the Court while seeking ex-parte injunction in the suit.
31. As regards the agency with Sidel, Sidel vide their letter dated December 18, 1995 gave notice to Petequip under Article 10(1) of the Contract of Agency informing it that the contract of agency after its expiry on 28.7.1996 would not be renewed. Their contract of agency with plaintiff thus also stood terminated on or about 28.7.1996
32. It appears, in the meantime, Sidel has approached defendant for giving their agency to the latter w.e.f 1.8.1996 which fact was brought by defendant to the notice of the plaintiff in his letter dated 16.7.1996 Grievance of the plaintiff is against this agency taken by the defendant.
33. The question arises whether there was any subsisting agreement between the plaintiff and Sidel in view of termination of the agency by Sidel by their letter dated 18th December, 1995? The contention of the learned counsel for the plaintiff is that the agency agreement was for 2 years commencing on 1.3.1994 and it could be terminated by 6 months' prior notice. Otherwise, it automatically was renewable and in the present case such notice was not given 6 months before 1.3.1996 and as such agency was automatically renewed and it was not legally terminated by a notice dated December 18, 1995. Whether or not the agency has been validly terminated is not the question before this Court. That is a dispute if at all between the plaintiff and Sidel which would be decided in a competent Forum as contemplated under the contract of agency between them. If the termination is ultimately found to be not valid plaintiffs at the most may be entitled to claim damages from the defendant and so it can not be said that there is any subsisting agency agreement between the plaintiff and Sidel. And it is not disputed that the agency of Husky stood terminated on 1.3.1996 and there is no subsisting agreement between the plaintiff and Husky after 1.3.1996
34. The other question is whether there is any subsisting contract between the plaintiff and the defendant? As already noticed a business agreement was entered into between Petequip and the defendant on the terms and conditions as mentioned in the letter dated July 30, 1994. This agreement was valid for one year starting from August 1, 1994. The terms were amended/modified vide another letter dated July 14, 1995 mutually agreed between the parties and the agreement was made valid for a period of one year from April 1, 1995. This agreement would end on 31.3.1996 and actually ended so. In pursuance of this agreement the accounts of the defendant were also settled for the year from April 1, 1995 to March 31, 1996 as per Petequip's letter dated May 16, 1996 sent to the defendant.
35. However, the case of the plaintiff is that a fresh agreement was entered into between the parties on July 28, 1995 as evidenced by letter of that date which is signed by three persons, namely, Gautam Mahajan, Debashish Bhaduri, and S.P Bangera, defendant. As already noticed two letters both dated 28.7.1995 were sent on behalf of Petequip one to Sidel and the other to Husky to meet the objection raised by Sidel and Husky about unsatisfactory working of their agency business by Petequip. In this letter, inter alia, change in organizational set up was proposed on the following lines:
“1. A new company, PETEQUIP India Private Limited is being formed which will be majority employees owned.
2. Both Mr. Bangera and Mr. Bhaduri will be part of this organization and are aware of the changes and are in agreement with it. Adequate compensation has been agreed to.
3. Mr. Bangera will assume day to day control of PETEQUIP India Private Limited. Mr. Bhaduri will assist him not only in the North but elsewhere.
4. We are prepared to add more staff, as necessary.
5. I have told Continental that I will be involved in sales calls for SIDEL.
6. The new PETEQUIP organization will come into effect immediately.
7. We believe the new organization puts in the best blend of strategic inputs, operational strengths, and marketing skills all of which will benefit SIDEL in India.
8. As a result of the new organization, all involved have agreed not to work directly with PETEQUIP'S clients and principals nor to compete for a period of 3 years after leaving PETEQUIP.
36. The terms as mentioned in this letter contemplated that a new company under the name of Petequip India Pvt. ltd. is to be formed and such company will be majoritv employees owned.
37. This letter in itself does not contain all the modalities of the said company and interalia it does not indicate about equity holding and sharing of profits by the constituents. It appears that to sort out this aspect some further discussions had taken place between Mr. Gautam Mahajan and the defendant in a meeting held on 25.9.1995 The gist/minutes of the meeting were sent by defendant to the plaintiff in his letter dated 26.9.1995 and interalia equity holding and sharing of profits by (1) Gautam Mahajan (2) S.P Bangera, and (3) Trust in other employees was discussed and decisions taken were as under:
(i) The new company, i.e PETEQUIP (INDIA) PVT. LTD. will be formed with the following equity participation:
Gautam Mahajan
33.3%
S.P Bangera
33.3%
Trust for other employees
33.3%
(ii) Mr. S.P Bangera will run the business in the capacity of managing director for atleast a minimum period of three years. Subsequent to this a C.E.O may be either employed or created from the amongst the staff if found suitable.
(iii) For running the show, Mr. Bangera will get the benefits as under:—
(a) 17.5% of total commission received.
(b) 33.3% of net profit
On relinquishing the charge as managing director, Mr. Bangera will continue to receive 10% of total commission and 33.3% of net the profit.
(iv) Mr. Mahajan will receive 10% of total commission and 33.3% of the net profit perpetually.
38. There is no explanation from the side of the plaintiff brought on record in the plaint, application, reply, replication or rejoinder, or otherwise as to whether or not terms as mentioned in this letter dated 26.9.1995 were actually implemented or not and if any organizational set up had been formed after this discussion. The fact remains that neither any material has been brought on record nor it is the case of the plaintiff that these decisions were actually implemented. On behalf of the plaintiff copy of a certificate of incorporation of M/s. PETEQUIP (INDIA) PVT. LTD., dated 16.6.1995 has been placed on record which shows that PETEQUIP (INDIA) PVT. LTD. had already been formed on 16.6.1995 much before 28.7.1995 when the letter of that date containing the terms of alleged agreements was sent under the signatures of three persons to Sidel and Husky. Obviously the company that was so formed was not in accordance with the arrangement arrived at between the parties in letter dated 28.7.1995 Defendant in his rejoinder dated 4.10.1996 has pleaded that the company Petequip India Pvt. Ltd. formed on 16.6.1995 was formed by two persons, namely, K.K Sood and A.K Sood, father and son each having 10 shares of Rs. 10/- each. Obviously, Plaintiff and defendant had no right or interest therein as was contemplated in Letter dated 28.7.1995 It also cannot be said that the terms and conditions as mentioned in letter dated 28.7.1995 in itself formed a concluded contract between the parties. As already mentioned the proposal contained in letter dated 28.7.1995 sent to Sidel and Husky was in the nature of proposal to meet their objections about unsatisfactory working of the agency business and to satisfy them so that they may continue the agency business with the plaintiff. Sidel and Husky never conveyed their acceptance of these terms and conditions and as such this proposed arrangement between plaintiff and defendant is not binding either on Sidel or on Husky.
39. These terms and conditions also did not form concluded contract between the three signatories, namely, Gautam Mahajan, Debashish Bhaduri and the defendant in as much it contemplated setting up of a new private limited company under the name of PETEQUIP (INDIA) PVT. LTD. a majority employee owned and both Mr. Bangera (defendant) and Mr. Bhaduri were to assume day to day control of PETEQUIP (INDIA) PVT. LTD. Mr. Bhaduri was to assist him all through out and other modalities as were discussed in another meeting on 25.9.1995 as mentioned in minutes contained in defendant's letter dated 26.9.1995
40. There is nothing on record that these terms were implemented at all. It was all in preliminary stage and as such it cannot be said that a concluded contract had taken place between the plaintiff and defendant on the lines as mentioned in letter dated 28.7.1995 This again was not more than proposed set up. As the parties had not come to terms of the agreement the proposal made in letter dated July 28, 1995 never became an enforceable contract between them creating mutual rights and obligations. It follows that clause 8 contained jn this letter, which is very strongly relied on behalf of the plaintiff did not come into force and this cannot be availed by the plaintiff for the relief claimed in the suit. Moreover, as already noticed there was a contract between plaintiff and Husky which came to an end on 1.3.1996 and the contract of agency between the plaintiff and Sidel had also come to an end on 28.7.1996 There is no subsisting contract between the plaintiff and those two principals. The said clause 8 apparently was intended to safeguard the interest of both Sidel and Husky on the one hand and the plaintiff on the other and as there is no subsisting contract between Sidel and Husky and the plaintiff the question of protecting their interest after termination of the agency agreements would not arise.
41. Section 27 of the Contract Act declares that every agreement by which any one is restrained from exercising a lawful profession, trade or business of any kind is to that extent void. In Niranjan Shankar Golikari (supra) (AIR 1967 SC 1098); Superintendence Company Of India (P) Ltd. v. Krishan Murgai.'s case (supra) (A.P Sen, J.) AIR 1980 SC 1717; and in Gujarat Bottling Company Ltd. v. Coca Coala Company Ltd. 1995 (5) SCC 545 in paras 31-32 it has been held that the doctrine of restrain as contained in Section 27 of Contract Act does not apply during the period the contract is subsisting but it applies when the contract comes to an end. Thus after the agency of Sidel and Husky came to an end the restrictive covenant contained in clause 8 would be unenforceable under section 27 of the contract.
42. Also as already noticed the arrangement/contract as was arrived at between the plaintiff and defendant on 30.7.1994 and which was modified on 14.7.1995 had already come to an end on 31.3.1996 And there was no subsisting contract between the plaintiff and defendant also and as such clause 8 of the agreement contained in letter 28.7.1995 would not be enforceable against defendant also being in restraint of trade under Section 27 of the Contract Act.
43. Section 42 of the Specific Relief Act, 1963 prescribes that notwithstanding anything contained in clause (e) of section 41, where a contract comprises an affirmative agreement to do certain act coupled with negative agreement, express or implied, not to do a certain act, the circumstance that the Court is unable to compel specific performance of the affirmative agreement shall not preclude it from granting an injunction to perform the negative agreement and this is subject to proviso that the plaintiff has not failed to perform the contract so far it is binding on him. Obviously, injunction can be granted in a contract which cannot be specifically performed where the contract between the parties contains affirmative terms and negative covenants. In the present case as already noticed there is no positive subsisting contract between the parties and as such the question of issuing injunction for enforcement of negative covenant would not arise.
44. Moreover, the Court is not bound to grant injunction in every case and injunction to enforce a negative covenant even could be refused in appropriate cases. When the alleged contract itself is not a valid contract or in any case is vague, its negative covenant could not be enforced by granting injunction. It is an established principle that where in a case ultimately permanent injunction cannot bo granted the Court would not grant temporary injunction.
45. An order of temporary injunction can be justified only if prima-facie case is made out by the plaintiff showing that in all probability the plaintiff is entitled to obtain ultimately a permanent injunction. Such prima-facie case is not made out or exists in favour of the plaintiff. Moreover, assuming there is any contract, for its violation the plaintiff could be suitably compensated by damages in as much as the plaintiff may be entitled to share in the profits that the defendant may obtain out of the agency business with Sidal and/or Husky if it is held to be in violation of agreement/contract between the plaintiff and defendant. The contracts of agency between plaintiff and Sidel and Husky have come to an end. The latter obviously are not going to have business dealings with the plaintiff. Though it appears that they have entered into some agreements with defendant, it will not serve any body's interest if the defendant is also restrained from doing business with Sidel and/or Husky. Balance of convenience also does not lie in favour of the plaintiff rather it is on the other side.
46. For all these reasons the plaintiff is not entitled to interim injunction.
47. Learned counsel for defendant has also contended that the plaintiff had not complied with the mandatory provisions of Order 39 Rule 3 C.P.C in as much as the affidavit of compliance of the same was not filed by the plaintiff. Objection to this effect was taken in arguments. And an affidavit dated 16.10.1996 was filed was filed after hearing of arguments were commenced.
48. Order 39 Rule 3 C.P.C enjoins upon the applicant for injunction to deliver to the opposite party or to send to him by registered post immediately after the order granting ex-parte injunction has been made, a copy of the application for injunction together with other relevant documents as mentioned therein on which applicant relies and file on the date on which such injunction is granted or on the date immediately following that date an affidavit that such copies as aforesaid were so delivered or sent. In Shiv Shankar Chadha v. Municipal Corporation of Delhi 1993 (3) SCC 161 it was held that the compliance of this provision is mandatory. Following this judgment this Court in M/s. Marble Udyog Ltd. M/s. P&O India Agency Pvt. Ltd. 1995(3)AD Delhi 812 has held that for non compliance of this provision there was no option left with the Court except to vacate the ex-parte order of injunction. For this reason also the temporary injunction is liable to be vacated. However, the plaintiff has been found to be not entitled to temporary injunction on merits.
49. In view of the above discussion the IA No.7411/96 filed by the plaintiff is dismissed and IA No.8466/96 filed by the defendant under Order 39 Rule 4 C.P.C is allowed with costs. The temporary injunction granted on 16.8.1996 is set aside and vacated. Costs assessed at Rs.5,000/- to be paid by the plaintiff.