Temporary injunctions require irreparable injury; a prima facie case alone is insufficient where loss is compensable in damages.

Temporary injunctions under Order 39 Rules 1 and 2 of the Code of Civil Procedure require a prima facie case, balance of convenience, and irreparable injury. The Supreme Court accepted that the respondent had a prima facie basis to allege breach of the covenant, but held that injunction could not be sustained because the claimed loss was compensable in damages. Since the plaint itself showed quantified financial loss, goodwill loss, and relocation loss, the injury was not irreparable. The temporary injunction and the High Court's order were set aside.

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Issues: (i) Whether the order of temporary injunction was justified on the basis of a prima facie case under Order 39 Rules 1 and 2 of the Code of Civil Procedure, 1908. (ii) Whether an injunction could be sustained when the claimed injury was capable of compensation by damages and no irreparable injury was shown.

Issue (i): Whether the order of temporary injunction was justified on the basis of a prima facie case under Order 39 Rules 1 and 2 of the Code of Civil Procedure, 1908.

Analysis: Temporary injunctions are governed by the Code of Civil Procedure, 1908, and the settled requirements are prima facie case, balance of convenience, and irreparable injury. On the terms of the agreement, the respondent had a prima facie basis to complain of breach of the covenant requiring retention of possession until expiry of the agreement, and the courts below were correct on that limited aspect.

Conclusion: The existence of a prima facie case was accepted.

Issue (ii): Whether an injunction could be sustained when the claimed injury was capable of compensation by damages and no irreparable injury was shown.

Analysis: Even where a prima facie case exists, injunction cannot issue unless refusal would cause irreparable injury. The plaint itself quantified substantial alternative damages, including projected loss of profit, goodwill loss, and relocation loss, showing that the grievance was essentially compensable in money. The courts below erred in treating the apprehended financial loss as irreparable injury.

Conclusion: The injunction could not be sustained because no irreparable injury was shown.

Final Conclusion: The temporary injunction and the High Court's order were set aside, and the appeals succeeded with no order as to costs.

Ratio Decidendi: A temporary injunction under Order 39 Rules 1 and 2 of the Code of Civil Procedure, 1908 cannot be maintained merely on a prima facie case where the alleged injury is compensable in damages and therefore not irreparable.

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