Citation Codes

Equivalent Citations

citation codes

Case Number

Misc. (First) Appeal No. 200 of 1983

Advocates

For Appellants— M.M Sapre.
For Respondents— K.P Munshi.

Judges

B.C Varma, J.

Acts

Order 30. Rules 1 and 2 of the Code of Civil Procedure. Since this provision
CIVIL PROCEDURE CODE AMENDMENT ACT
Order 43. Rule 1 (r) of the Code of Civil Procedure.
Rule 4 of Order 39.
Rule 3 of Order 39
Order 43. Rule 1

See more information ...

Smart Summary

Structured Summary of the Provided Opinion

Factual and Procedural Background

The dispute arises from a registered partnership firm (plaintiff No. 1/respondent No. 1), which manufactures and sells bidi. The appellants and other respondents are partners in the firm. Two factions have formed among the partners: the two appellants on one side and respondents 2 to 7 on the other, and their interests are adverse.

The respondents (plaintiffs) alleged that the appellants undertook hostile activities adverse to the partnership, including: starting a competitive business under a name identical to the plaintiff firm (M/s. Purshottam Bhai Dhoribhai and Company), withdrawing Rs. 50,000 from partnership funds for themselves, issuing directions to banks freezing the firm's accounts, and an incident in which one Atul Patel was allegedly manhandled (a police report was made). The plaint also alleges that these actions caused panic among about 2,500 employees and disrupted the firm's business.

The plaintiffs brought a suit seeking (inter alia) a declaration that they are entitled to conduct the partnership business to the exclusion of the appellants or only in consultation with them, and various injunctions restraining the appellants from entering the firm's premises, interfering with management, conducting a similar business under an identical or deceptively similar name, and from interfering with day-to-day matters. An application for a temporary injunction was filed with supporting affidavit and documents.

The trial Court granted an ex parte temporary injunction restraining the appellants from interfering with the routine and day-to-day administration of the business of plaintiff No. 1. The present appeal challenges that ex parte injunction order.

Legal Issues Presented

Whether the trial Court properly exercised its power under Order 39, Rule 3 (and the proviso added by the Civil Procedure Code (Amendment) Act No. 104 of 1976) to grant an ex parte temporary injunction without prior notice to the appellants.
What is the scope of appellate/revisional review of an ex parte temporary injunction granted under Rule 3 of Order 39 and its proviso — in particular, whether the reviewing court should examine merits or only whether the trial Court had good reasons to grant ex parte relief.
Whether an appeal against an order granting an ex parte temporary injunction is maintainable under Order 43, Rule 1(r) of the Code of Civil Procedure (this point was raised but the Court refrained from expressing any opinion on it).

Arguments of the Parties

Respondents' (Plaintiffs') Position

The respondents presented a plaint and an application (with affidavit and documents) asserting that the appellants' alleged activities (competitive business in identical name, withdrawal of funds, bank instructions freezing accounts, alleged assault) were hostile and prejudicial to partnership business, justifying immediate ex parte relief to prevent further damage and to maintain the status quo.
Learned counsel for respondents objected to the maintainability of the appeal, citing authorities that an appeal against an order granting ex parte temporary injunction is not maintainable (see text: Parijatha v. Kamalaksha Nayak and Abdul Shakoor v. Umachander).

Appellants' Position

Learned counsel for the appellants placed before the Court certain facts which, according to him, would disentitle the respondents to an order of temporary injunction; these facts and supporting material were not detailed in the opinion.
Appellants' counsel relied upon authorities taking a contrary view on the maintainability of an appeal against an ex parte temporary injunction (see text: Zila Parishad v. B. R. Sharma; Chhaganlal v. Niwasdas; Shaik Jusa v. Ganpat Dagdu; Rai Kumari v. Prem Lal).

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Order 30, Rules 1 and 2, Code of Civil Procedure	Governs the grant of temporary injunctions.	The Court noted these provisions as the general law governing temporary injunctions; they permit relief even without final adjudication on merits.
Order 39, Rule 3, Code of Civil Procedure (with proviso added by Civil Procedure Code (Amendment) Act No. 104 of 1976)	Requires notice to the opposite party before granting an injunction except where delay would defeat the object; proviso requires recording reasons and post-order service of pleadings/documents and an affidavit of service.	The Court analysed the purpose of Rule 3 and its proviso, emphasising that the proviso is a safeguard against abuse: the trial Court must record compelling reasons for granting ex parte relief and ensure the applicant sends copies to the opposite party and files an affidavit of such compliance. The Court held that the trial Court had applied its mind and recorded reasons and therefore did not contravene Rule 3 and its proviso.
Order 39, Rule 4, Code of Civil Procedure	Provides that a person affected by an ex parte injunction may appear before the Court to show cause against it and the Court may discharge, validate or set aside the order after hearing.	The Court relied on Rule 4 to note that appellants have an available remedy before the trial Court to seek discharge of the ex parte injunction; this supported the conclusion that appellate interference was unnecessary where the trial Court had recorded reasons and applied its mind.
Order 43, Rule 1(r), Code of Civil Procedure	Pertains to the maintainability of appeals against certain interlocutory orders (issue raised in the opinion).	The Court acknowledged conflicting authorities on whether an appeal against an order granting an ex parte temporary injunction is maintainable under this provision but expressly refrained from deciding the maintainability question and proceeded to decide the appeal on merits.
Parijatha v. Kamalaksha Nayak, AIR 1982 Kant 105	Cited as authority that an appeal against an order granting ex parte temporary injunction is not maintainable.	Cited by respondents' counsel in support of the non-maintainability argument; the Court recorded the citation but did not decide the broader question of maintainability.
Abdul Shakoor v. Umachander, AIR 1976 Mad 350	Cited as authority that an appeal against an order granting ex parte temporary injunction is not maintainable.	Cited by respondents' counsel; the Court recorded this position but refrained from expressing an opinion on maintainability.
Zila Parishad v. B. R. Sharma, AIR 1970 All 376 (FB)	Cited as authority taking a contrary view (i.e., that such appeals may be maintainable).	Cited by appellants' counsel as supporting maintainability; the Court noted this conflicting authority and did not resolve the conflict in this opinion.
Chhaganlal v. Niwasdas, AIR 1963 Madh Pra 208	Cited as authority taking a contrary view on maintainability.	Cited by appellants' counsel; the Court recorded the citation but did not adjudicate the maintainability issue.
Shaik Jusa v. Ganpat Dagdu, AIR 1976 Bom 222	Cited as authority taking a contrary view on maintainability.	Cited by appellants' counsel; the Court noted the citation and refrained from pronouncing on the issue.
Rai Kumari v. Prem Lal, AIR 1972 Him Pra 671	Cited as authority taking a contrary view on maintainability.	Cited by appellants' counsel; the Court recorded the citation but did not decide the maintainability question.

Court's Reasoning and Analysis

The Court's reasoning proceeds from an analysis of the statutory scheme governing temporary injunctions and the special position of ex parte interim relief:

The Court explained the purpose of Order 39, Rule 3 and its proviso: while Rule 3 permits grant of ex parte temporary injunction where giving notice would defeat the object, the proviso (introduced by the 1976 amendment) imposes safeguards — the trial Court must record reasons for concluding that delay would defeat the object and must require the applicant to send copies of the application, affidavit, plaint and relied-upon documents to the opposite party immediately after the order, and to file an affidavit of such service. The proviso aims to prevent abuse of ex parte relief.
Given the special nature of ex parte temporary injunctions (they aim to maintain status quo or prevent imminently prejudicial acts without adjudication on merits), the Court held that the scope of appellate/revisional review of such relief is limited. A reviewing court should not re-adjudicate the merits of the plaintiff's substantive claim; rather, it should examine whether the trial Court had "good reasons" and applied its mind before granting the ex parte injunction.
If the applicant places good and compelling reasons before the trial Court and the trial Court records reasons for proceeding ex parte, and the requirements of the proviso are complied with (including post-order service and affidavit), the reviewing authority should generally not interfere. The availability of Rule 4 (allowing the affected party to appear before the trial Court and seek discharge or setting aside of the order) further limits the need for appellate interference at that stage.
Applying these principles to the present case, the Court examined (as recited by the trial Court in its order) the reasons given by the respondents for urgent relief — allegations of competitive business in identical name, withdrawal of funds, freezing of bank accounts, alleged assault, and disruption of business affecting employees. The trial Court had applied its mind and formed an opinion that the appellants should be restrained from interfering with day-to-day management.
The Court acknowledged that partners ordinarily have rights to participate in management and access business premises and books, but these rights do not entitle them to undertake hostile activities that may bring the partnership to a standstill. The pleaded allegations, in the Court's view, justified the trial Court's intervention by an ex parte order to prevent immediate prejudice.
The Court therefore concluded that there was no violation of Rule 3 and its proviso in the impugned order and that interference by the appellate court was not warranted. The Court also noted the appellants' option to appear before the trial Court under Rule 4 to seek discharge of the ex parte order and expressly refrained from deciding the technical question of whether an appeal against such an order is maintainable under Order 43, Rule 1(r).

Holding and Implications

Core Ruling: The Court held that the impugned ex parte temporary injunction order passed by the trial Court "cannot in any way be said to be contravening the terms of Rule 3 of Order 39" and, accordingly, that the appellate court should not interfere with that order.

Implications and Direct Consequences:

The trial Court's ex parte injunction restraining the appellants from interfering with the day-to-day management of the partnership business remains undisturbed by this appellate order.
The appellants retain the procedural remedy under Order 39, Rule 4 to appear before the trial Court, show cause against the injunction and seek discharge, validation or setting aside of the ex parte order; the opinion expressly recognizes this procedural route.
The Court declined to rule on the broader, technical question of the maintainability of an appeal against an order granting an ex parte temporary injunction under Order 43, Rule 1(r); consequently, this opinion does not settle that point as precedent.

This summary is strictly confined to the statements and materials contained in the provided opinion and does not add, infer, or interpret facts beyond those expressly set out in that text.

Show full summary ...

Bipin Chandra And Another v. M/S. Purushottam Bhai Dhoribhai And Company And Others .

1. Respondent No. 1 (plaintiff No. 11 is a registered partnership firm of which the appellants and other respondents are partners. The firm deals in manufacture and sale of bidi and has extensive property. It has accounts in different banks. It appears that the two appellants on one side and the respondents 2 to 7 on the other have now formed two separate groups and their interests are adverse to each other. The respondents feel that the recent activities of appellants are adverse to the interest of the partnership and therefore, in order to prevent them from continuing such activities, they brought a suit claiming declaration that they to the exclusion of the appellants are en-

titled to conduct the business of the partnership only in consultation with the appellants, the appellants cannot oust the plaintiffs from controlling the management of the affairs of the partnership firm, and that the appellant be injuncted either personally or through their agents from entering the business premises of the firm and from interfering with the management of the firm in any manner whatsoever. An injunction is also claimed restraining the appellants from interfering with day-to-day and routine matter connected with the control and management of the affairs of the firm. Injunction is also claimed restraining the appellants from starting or carrying on any independent business in the name and style of "M/s. Purshottam Bhai Dhoribhai and Company (H.U.F.) or under any other name identical to or deceptively similar to the name of the plaintiff firm. Certain other reliefs have also been claimed. In paragraphs 11 to 23 of the plaint, various averments have been made showing the adverse activities of the appellants, the sum total of which is that they have started a competitive business in a name identical with the name of the plaintiff firm (M/s. Purshottam Bhai Dhoribhai and Company), that they have withdrawn a sum of Rs. 50.000 for themselves out of the partnership funds, that they have issued directions to the banks freezing accounts of the firm with those banks, and that one Atul Patel was manhandled of which a report was loaded to the Police Station, Kanker. It is also alleged that due to the aforesaid activities of the appellants, about 2500 employees of the firm have become panicky and the business of the firm cannot be carried on smoothly. An application for grant of temporary injunction was made simultaneously with the suit along with an affidavit and certain documents. The plaintiffs could succeed in persuading the trial Court to pass an ex parte temporaray injunction restraining the appellants from interfering in any manner whatsoever with the routine and day-to-day administration of the business of the plaintiff No. 1. The present appeal is directed against this order.

2. The grant of temporary injunction is governed by Order 30. Rules 1 and 2 of the Code of Civil Procedure. Since this provision permits indulgence to a suitor even without adjudication of his claim on merits. Rule 3 of Order 39 requires the Court to issue a notice of the application for grant of temporary injunction to the opposite party before passing any order in terms of that order. The provisions are, however, aimed at preventing any immediate waste, damage or alienation of the property in dispute in a suit or from its being wrongfully sold in execution of a decree. The purpose of this provision is also to prevent a defendant to remove or dispose of his property with a view to defraud this creditor and to restrain him from committing a breach of a contract or any other injury of the kind. Occasions are not few when a party needs immediate intervention of the Court for a direction to the opposite party in terms of Order 39. At such occasions, the issuance of notice to the opposite party of an application for grant of temporary injunction pending disposal of the suit and awaiting the reply of that party may defeat the object of the application itself and it may be that by the time the notice is served and the opposite party is heard, the mischief sought to be prevented may already be done and the application may become infructuous. It has, therefore, been provided under Rule 3 of Order 39 that the Court may depart from the general rule of issuing notice of the application for Brant of temporary injunction to the opposite party and may pass an ad interim injunction in case where "it appears that the object of granting the injunction would be defeated by the de-lay". The terms of Rule 3 are as follows:

''The Court shall in all cases, except where it appears that the object of granting the injunction would be defeated by the delay, before granting an injunction, direct notice of the application for the same to be given to the opposite party."

By the Civil Procedure Code (Amendment) Act No. 104 of 1976, the following proviso has been added to this Rule:

"Provided that, where it is proposed to grant an injunction without giving notice of the application to the opposite party, the Court shall record the reasons for its opinion that the object of granting the injunction would be defeated by delay and require the applicant-

(a) to deliver to the opposite party or to send to him by registered post, immediately after the order granting the injunction has been made, a copy of the application for injunction together with-

(i) a copy of the affidavit filed in support of the application:

(ii) a copy of the plaint: and (iii) copies of documents on which the applicant relies, and

(b) to file, on the day on which such injunction is granted or on the day immediately following that day, an affidavit stating that the copies aforesaid have been so delivered or sent." Thus, while Rule 3 permits the Court to grant an ex parte temporary injunction, the proviso enacts a safeguard to the exercise of that jurisdiction. It makes incumbent upon a Court to record its reason for the opinion that withholding of ex parte injunction would defeat the very object of granting injunction. What seems to be intended by adding the proviso is that there should appear to be compelling reasons for the Court to proceed to pass an ex parte temporary injunction without notice to the opposite party and that such reasons must be recorded before the power is exercised. Those reasons must be sufficient to draw an inference that the object of granting the injunction would be defeated if the Court were to await for noticing and hearing the opposite party. The proviso thus is intended to prevent the abuse of the exercise of power granted by Rule 3 to issue ex parte temporary injunction without notice to the opposite party.

3. In view of the object underlying Rule 3 and its proviso. I am of the opinion that the scope of an appeal/revision filed against the grant of ex parte temporary injunction without notice to the opposite party is very limited. The merits of the claim for grant of temporary injunction have not to be examined. Since the ex pare temporary injunction only aims at maintaining status quo for the time being or the forbearance from doing an act imminently prejudicial to the plaintiff who obtains the order and does not seriously affect the right of the parties: what may be seen for the review of that order is whether the Court had good reasons before it to proceed to grant an ex parte temporary injunction.

If the reviewing authority finds that the party seeking the injunction places good and compelling reasons before the Court for maintaining the status quo or for a direction preventing performance of any prejudicial act, and that the trial Court has applied its mind to those facts and has recorded the reasons to grant an ex parte injunction the reviewing authority may not interfere. This is particularly so because Clause (a) of the proviso to Rule 3 itself requires that the Court shall direct the party seeking ex parte temporary injunction to deliver to the opposite party or to sent to him by registered post a copy of the application for injunction along with affidavit filed in its support and a copy of plaint and conies of documents on which reliance is placed: and also because Rule 4 of Order 39 enables the person affected by such grant of ex parte temporary injunction to appear before the Court itself and show cause against the application and net the order discharged or validated or set aside. When he so appears the Court shall hear him at length and then may decide the application on merits.

4. For the reasons stated in the plaint and the application, which I have referred to earlier, the respondents/plaintiffs requested the trial Court for an ex carte direction to prevent the appellants from interfering with the day-to-day management of the partnership business. The trial Court has in the impugned order mentioned those reasons. It has applied its mind to them and formed an opinion that the appellants should be prevented from interfering with the day-to-day management of the partnership business by the respondents. While it is true that being partners the appellants' right to participate in the business of the partnership and to have access to the place of business and the account books cannot be denied, it is equally true that they cannot be permitted to carry hostile activities which may adversely affect the partnership business itself and may bring it to a standstill. The allegations made in the plaint and the application, in my opinion, rightly prompted the trial Court to step in to prevent the appellants from interfering with the day-to-day management and working of the partnership. It, therefore, cannot be said that the formation of opinion by the trial Court to proceed in terms of Rule 3 and its proviso to pass an ex parte temporary injunction violates any of those provisions and calls for any interference. Learned counsel for the appellants placed before me certain facts which, according to him, would disentitle the respondents to an order of temporary injunction in their favour. It is not for me in this appeal to consider the merits and demerits of the application in the light of the facts alleged by the appellants. The appellants may well place all those facts and the supporting material before the trial Court and pray for discharge of the rule in terms of Rule 4 of Order 39. In my opinion, the impugned order cannot in any wav be said to be contravening the terms of Rule 3 of Order 39 and, therefore, cannot be interfered with.

5. Shri K. P. Munshi, learned counsel for the respondents, raised an objection that the appeal is not maintainable. No doubt there are authorities to say that an appeal against the order granting ex parte temporary injunction is not maintainable under Order 43. Rule 1 (r) (see: Parijatha v. Kamalaksha Nayak, AIR 1982 Kant 105 and Abdul Shakoor v. Umachander, AIR 1976 Mad 350). Shri M. M. Sapre, learned counsel for the appellants, however, placed certain authorities taking a contrary view. (See ; Zila Parishad v. B. R. Sharma, AIR 1970 All 376 (FB). Chhaganlal v. Niwasdas, AIR 1963 Madh Pra 208, Shaik Jusa v. Ganpat Dagdu, AIR 1976 Bom 222 and Rai Kumari v. Prem Lal, AIR 1972 Him Pra 671. Shri Munshi however, expressed that this appeal be decided on merits and not on this technical ground and, therefore, I refrain from expressing any opinion if an appeal against on order passed granting an ex parte temporary injunction is maintainable under Order 43. Rule 1 (r) of the Code of Civil Procedure.

Bipin Chandra And Another v. M/S. Purushottam Bhai Dhoribhai And Company And Others .

Structured Summary of the Provided Opinion

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Respondents' (Plaintiffs') Position

Appellants' Position

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Bipin Chandra And Another v. M/S. Purushottam Bhai Dhoribhai And Company And Others .

Comments