TaxTMI 
TaxTMI 
TaxTMI 
2024 (11) TMI 1530
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....ginal plaintiffs before the trial court, instituted the Special Civil Suit No. 54 of 2019 for declaration, cancellation of registered sale deed bearing no. 2863 dated 23.03.2018 and permanent injunction against the respondents herein, that is, the original defendants. In the said suit, the plaintiffs filed an application below Exhibit-5 for grant of temporary injunction under Order 39 Rules 1 and 2 read with Section 151 of the Code of Civil Procedure, 1908 ("CPC"). 5. For the sake of convenience, the parties are referred to by their nomenclature in the original suit. 6. Plaintiff nos. 1 to 3 respectively are real brothers and plaintiff nos. 4 to 6 respectively are their respective wives. Defendant no. 1 is the real brother of the plaintiff nos. 1 to 3 respectively and defendant no. 2 is his wife. Defendant nos. 3 and 4 respectively are the sons of the defendant nos. 1 and 2 respectively, and defendant no. 5 is the wife of the defendant no. 3. 7. In brief, it is the case of the plaintiffs that they purchased the suit property situated in Sub-Plot No. 1, Navrang Co-operative Housing Society, Survey No. 549/2, Alkapuri, Vadodara on 19.09.1991 by way of a registered sale deed ....
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....y became redundant, but was kept preserved in the office for the sake of record. b. In 2012, the defendant no. 1 expressed his inclination to retire and part ways from the family business, however this was not accepted by the plaintiff nos. 1 to 3 respectively as they wanted the family members to live jointly. Subsequently, the defendant no. 1 stopped paying attention to the family business and withdrew his share as well as additional amounts from the family business and created his individual responsibilities. As the liabilities of the defendant no. 1 increased, the family business being conducted on the suit property had to be shut down in November, 2013. However, the business records, documents, ornaments, stocks, etc. were kept in the showroom. Thereafter, the plaintiffs along with their sons started their own business. c. The defendant no. 1, in collusion with the officials of the office of the sub-registrar, executed a sale deed of the suit property without any sale consideration in favour of his son, that is, the defendant no. 3, illegally relying on the power of attorney of 1995. The other son of the defendant no. 1 and the wife of the defendant no. 3 stoo....
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....howroom and as a result the stock in trade, finished and semi-finished goods, gold, diamond, platinum, etc. was taken away by the plaintiffs. d. At the time of the closure of the showroom, the plaintiff nos. 1 to 3 handed over the keys of the showroom to the defendant no. 1 and instructed him to sell the same in the open market and distribute the consideration equally among the joint owners. Accordingly, the physical & vacant possession of the suit property was handed over to the defendant no. 1. e. The defendant no. 1 intimated the plaintiff nos. 1 to 3 over a phone call that he was selling the suit property in favour of the defendant no. 2 and also that the sale consideration of Rs 1.70 Crore would be adjusted towards the dues of the defendant no. 1. f. The power of attorney is a registered document and was never cancelled by the plaintiffs, and the said power of attorney was used with the consent of all the signatories to it. 13.The trial court, after hearing the parties on the application for grant of temporary injunction, took the view that the conditions for grant of injunction in favour of the plaintiffs were satisfied and accordingly allowed th....
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.... attorney only after taking consent of all the signatories. As per the family arrangement, an amount of Rs 16.50 Crore is due to the defendant no. 1 from the plaintiffs. f. Clause No. 5 of the power of attorney dated 05.04.1995 suggests that the power was given to undertake the procedure for sale in reference to the Income Tax authority and clause no. 6 suggests that the defendant no. 1 is empowered to fully utilize that power. g. The defendant no. 3 is a bona fide purchaser of the suit property for a sale consideration of Rs 1.70 Crore and since the registered sale deed is not void, there can be no injunction against the purchaser from enjoying the suit property and the sale in his favour cannot be said to be null and void. h. The defendants, under the threat of being forcibly & illegally dispossessed from the suit property, preferred Regular Civil Suit No. 36/2019 before the 10th Additional Chief Judicial Magistrate & Civil Judge, First Class, Vadodara seeking mandatory injunction against the plaintiffs, wherein the said Civil Judge was pleased to restrain the plaintiffs and their agents from entering into the premises of the suit property till the disp....
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....h the parties. The appellate court should remain slow in substituting its own discretion with the one exercised by the court of first instance unless the exercise of discretion by the first court was shown to be malicious, capricious, perverse or having been exercised in ignorance of the settled principles of law regulating the grant or refusal of interlocutory injunctions. 18.The High Court by way of the impugned order, allowed the appeal filed by the defendants and vacated the order granting injunction in favour of the plaintiffs. The High Court took the view that with the grant of injunction, the trial court had virtually allowed the suit, though no case for grant of interim injunction could be said to have been made out. The High Court also referred to other pending civil and criminal litigations between the parties and observed that the same suggested that the plaintiffs were intentionally harassing the defendants one way or the other. The relevant observations made by the High Court are extracted below: "16. [...] It also emerges from the record that the respondents seek share from the property which the appellant is entitled to get as family settlement and they a....
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.....02.2019, which came to be rejected by this Court. It reveals that against the order dated 04.02.2019 passed in Special Criminal Application No.859 of 2019 and order dated 20.03.2019 passed in Criminal Misc. Application No.1 of 2019, the defendants preferred Special Leave to Appeal before the Hon'ble Supreme Court, which came to be dismissed vide order dated 24.02.2020. 18. Considering the facts of the case, it appears that the plaintiffs have tried to see that any how, the defendants - appellants herein be ruined and surrendered to the demands of the original plaintiffs. It seems that the original plaintiffs one after another initiated proceedings against the present appellants including the civil as well as criminal. It is relevant tonote here that in criminal proceedings though "C" summary report came to be filed by the Investigating Officer before the concerned Court, the original plaintiffs by utilizing the political pressure have restrained the Investigating Officer to submit the "C" summary report before the concerned Court and/or to withdraw "C" summary report. It also appears that in earlier round of litigation, the original plaintiffs reached upto the Hon'ble....
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....Court reversed the findings of the trial judge. This Court, upon due consideration of the matter, took notice of two egregious errors said to have been committed by the High Court: a. First, as regards the scope and nature of the appeals before it and the limitations on the powers of the appellate court to substitute its own discretion in an appeal preferred against a discretionary order; and b. Secondly, the weakness in ratiocination as to the quality of Antox's alleged user of the trademark on which the passing off action is founded. 22.With regards to (a), this Court held thus: "In such appeals, the appellate court will not interfere with the exercise of discretion of the court of the first instance and substitute its own discretion, except where the discretion has been shown to have been exercised arbitrarily or capriciously or perversely, or where the court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions ... the appellate court will not reassess the material and seek to reach a conclusion different from the one reached by the court below ... If the discretion has been exercised by the trial court ....
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....ples of law; and b. In addition to the above, an appellate court may in a given case have to adjudicate on facts even in such discretionary orders. 27.The principles of law explained by this Court in Wander's (supra) have been reiterated in a number of subsequent decisions of this Court. However, over a period of time the test laid down by this Court as regards the scope of interference has been made more stringent. The emphasis is now more on perversity rather than a mere error of fact or law in the order granting injunction pending the final adjudication of the suit. 28.In Neon Laboratories Ltd. v. Medical Technologies Ltd. reported in (2016) 2 SCC 672 this Court held that the Appellate Court should not flimsily, whimsically or lightly interfere in the exercise of discretion by a subordinate court unless such exercise is palpably perverse. Perversity can pertain to the understanding of law or the appreciation of pleadings or evidence. In other words, the Court took the view that to interfere against an order granting or declining to grant a temporary injunction, perversity has to be demonstrated in the finding of the trial court. 29.In Mohd. Mehtab Khan v. Khush....
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....ilable. It further observed that if the appellate court itself decides the matters required to be decided by the trial court, there would be no necessity to have the hierarchy of courts. 31.This Court in Monsanto Technology LLC v. Nuziveedu Seeds Ltd. reported in (2019) 3 SCC 381, observed that the appellate court should not usurp the jurisdiction of the Single Judge to decide as to whether the tests of prima facie case, balance of convenience and irreparable injury are made out in the case or not. 32.The appellate court in an appeal from an interlocutory order granting or declining to grant interim injunction is only required to adjudicate the validity of such order applying the well settled principles governing the scope of jurisdiction of appellate court under Order 43 of the CPC which have been reiterated in various other decisions of this Court. The appellate court should not assume unlimited jurisdiction and should guide its powers within the contours laid down in the Wander (supra) case. PRINCIPLES GOVERNING GRANT OF TEMPORARY INJUNCTION 33.In the case of Anand Prasad Agarwal v. Tarkeshwar Prasad reported in (2001) 5 SCC 568,it was held by this Court that it woul....
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....obably be defined as one that is not only against the weight of evidence but is altogether against the evidence. In Godfrey v. Godfrey reported in 106 NW 814, the Court defined "perverse" as "turned the wrong way"; not right; distorted from the right; turned away or deviating from what is right, proper, correct, etc. 36.The expression "perverse" has been defined by various dictionaries in the following manner: a. Oxford Advanced Learner's Dictionary of Current English, 6th Ed. Perverse - Showing deliberate determination to behave in a way that most people think is wrong, unacceptable or unreasonable. b. Longman Dictionary of Contemporary English - International Edition Perverse - Deliberately departing from what is normal and reasonable. c. The New Oxford Dictionary of English - 1998 Edition Perverse - Law (of a verdict) against the weight of evidence or the direction of the judge on a point of law. d. New Webster's Dictionary of the English Language (Deluxe Encyclopedic Edition) Perverse - Purposely deviating from accepted or expected behavior or opinion; wicked or wayward; stubborn; cross or petulant. e. Stroud'....
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.... the High Court is voluminous and runs into more than 55 pages, yet it regrettably falls short of addressing the pivotal issues raised by the plaintiffs. While the High Court has observed that the order of the trial court has virtually decided the suit, in favour of the plaintiffs, a reading of the impugned order indicates other way round that it is indeed the order of the High Court which seems to have accepted the entire defence put forward by the defendants as the gospel truth, without assigning any cogent reasons for not accepting the prima facie case put up by the plaintiffs. 42.Instead of subjecting the order of the trial court to the right degree of appellate scrutiny warranted in appeals against interlocutory orders, the High Court has made general and overbroad observations touching upon the malicious intention of the plaintiffs in filing the civil suit and the application below Exhibit5 for the grant of temporary injunction. The failure of the High Court in pointing out any perversity in the order of the trial court is a glaring reminder of why the High Courts must exercise their appellate jurisdiction against interlocutory orders involving the exercise of discretion o....
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....e of all pendente lite transfers; but it may not always be good enough to take fullest care of the plaintiffs interest vis-a-vis such a transfer. We may give one appropriate illustration of a suit for specific performance of contract based on an agreement of sale. In a suit wherein the plaintiff prays for specific performance and if the defendant is not restrained from selling the property to a third party and accordingly a third party purchases the same bona fide for value without any notice of the pending litigation and spends a huge sum for the improvement thereof or for construction thereon, the equity in his favour may intervene to persuade the Court to decline, in the exercise of its discretion, the equitable relief of specific performance to the plaintiff at the trial and to award damages only in favour of the plaintiff. It must be noted that Rule 1 of Order 39 of the Code clearly provides for interim injunction restraining the alienation or sale of the suit property and if the doctrine of lispendens as enacted in Section 52 of the T. P. Act was regarded to have provided all the panacea against pendente lite transfers, the Legislature would not have provided in Rule 1 for in....