Delhi High Court
Agi Logistics Inc & Anr. vs Sher Jang Bahadur & Anr. on 16 September, 2009
Author: S. Muralidhar
Bench: S. Muralidhar
IN THE HIGH COURT OF DELHI AT NEW DELHI
CS(OS) 1314/2009
AGI LOGISTICS INC & ANR ..... Plaintiffs
Through Mr. Samdarshi Sanjay with
Ms. Surbhi Agarwal, Advocate
versus
MR. SHER JANG BHADHUR & ANR ..... Defendants
Through Ms. Vibha Mahajan Seth, Advocate
for D-1 to 5 and 7/applicants in IA 9768/09.
Mr. Bhaskar Mishra, Advocate for D-.8.
CORAM:
HON'BLE DR. JUSTICE S. MURALIDHAR
1. Whether reporters of the local newspapers be allowed to
see the order? No
2. To be referred to the Reporter or not? Yes
3. Whether the order should be reported in the Digest? Yes
ORDER
16.09.2009 IA No.9768/2009
1. This is an application filed by Defendants 2 to 5 and 7 (hereinafter „applicants‟/„defendants‟ under Order XXXIX Rules 3 and 4 CPC seeking vacation of an ex parte ad interim injunction granted by this Court by an order dated 22nd July 2009 in IA No.9150/2009 in the above suit.
2. Notice in this application was directed to issue by this Court on 3rd August 2009. Replies have been filed by the Plaintiffs and a rejoinder thereto has been filed by the applicants.
3. This Court has heard the submissions of Mr. Samdarshi Sanjay, the CS(OS) No.1314/2009 Page 1 of 12 learned Advocate for the Plaintiffs and Ms. Vibha Mahajan Seth, the learned Advocate for the Applicants/Defendants 2 to 5 and 7.
4. It is stated in the application that despite this Court in its order dated 22nd July, 2009 directing that the Plaintiffs should comply with the requirements of Order XXXIX Rule 3 CPC within one week, the Plaintiffs did not serve upon the Applicants within one week a copy of the plaint, the applications, the affidavits and documents filed by the Plaintiffs along with the Plaint. It is stated that this Court had appointed Local Commissioners to visit the Defendants‟ premises to examine the records including electronic records and seize any incriminating evidence to establish if the Defendants were carrying on business by using the words `AGI‟, `AGI Logistics‟ and `AG Freight‟ and whether they were dealing with the customers of the Plaintiffs. It is stated that even at the time of the visit of the Local Commissioner to the premises of Applicants/Defendants on 23rd July 2009 in Gurgaon, the complete set of papers were not served on the Applicants/Defendants or their counsel. It is further stated that at the time of the visit of the Local Commissioner, counsel for the Defendants had asked for copy of the plaint and entire documents from the counsel for the Plaintiffs assisting the Local Commissioner but this was declined.
5. It is stated in the application that a copy of the court notice was delivered to Defendant No.4 on 26th July 2009 by speed post. The cover in which the said notice was dispatched, has been placed on record. It has a postal receipt affixed to it showing that the weight of the envelope at CS(OS) No.1314/2009 Page 2 of 12 the time of dispatch was 25 gms. and the postage paid was Rs.24/-. It is obvious that the entire papers i.e. the plaint, affidavits, applications and documents were not sent by post by the counsel for the Plaintiffs to the Applicants/Defendants.
6. In reply to this application, the Plaintiffs state in para 6 as under:-
"It is submitted the plaintiffs/Non Applicants through their counsel had issued notices on the defendants/applicants informing them of the order dated 22.07.2009 of this Hon‟ble Court, but due to inadvertence and under bonafide mistake the copies of the plaint and the documents were not enclosed with the notices as issued on 24.07.2009. However, the plaintiffs/Non-applicants had no intention of purposefully disobeying the orders of this Hon‟ble Court as the Court on its own had permitted the plaintiffs to comply with the provisions of Order 39 Rule 3 within one week from the date of the order i.e. on or before 29.07.2009, so under the mistaken impression, that it would suffice if the plaintiffs/non-applicants filed the process fee for service of summons of the suit by way of ordinary process as well as through registered covers on all the defendants, it was for the said purposes that 18 sets of plaint and 9 sets of the documents were filed in the Registry of this Hon‟ble Court vide Diary No.117266 on 27.07.2009. Further, in compliance of the orders of the Court on 04.08.2009, the plaintiffs/non-applicants have supplied the copies of the plaint as well as the entire set of documents to the defendants/applicants, counsel, during the course of the proceedings. In view of the submissions made hereinabove, the averments of the present CS(OS) No.1314/2009 Page 3 of 12 application of the defendants/applicants, deserve no consideration at all."
7. Counsel for the Plaintiffs further drew attention of this Court to the affidavit of compliance filed by the Plaintiffs on 27th July 2009 enclosing therewith copies of the covering letter alongwith notices which were sent to the Defendants by way of registered post. A perusal of the said affidavit filed on 27th July 2009 shows that it is accompanied by copies of identical letters dated 23rd July 2009 addressed to each of the Defendants. A copy of the postal receipt affixed thereto again shows the total weight of the packet in which it was sent to be 25 gms. and the postage paid to be Rs.24/- each and the date of dispatch to be 24th July 2009. There is no other document attached to this affidavit which purports to be filed by way of the compliance of the Order XXXIX Rule 3 CPC.
8. Counsel for the Plaintiffs does not dispute that the complete set of the papers were delivered to the counsel for the Defendants/applicants only on 4th August 2009 in this Court when notice was first issued in this application.
9. There can be no manner of doubt that in the face of the above admissions by the counsel for the Plaintiffs that the requirement of Order XXXIX Rule 3 CPC was not complied with. The said provision reads as under:-
"3. Before granting injunction, Court to direct notice to opposite party-- The Court shall in all cases, except CS(OS) No.1314/2009 Page 4 of 12 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:
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."
10. It is plain that the Plaintiffs, after obtaining an ex parte ad interim injunction against the Defendants, failed to deliver to the Applicants/Defendants or to send them by registered post within one week, a copy of the application for ad interim 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 the documents on which the Plaintiffs rely upon. The statutory requirement is unambiguous. Every document filed by the CS(OS) No.1314/2009 Page 5 of 12 Plaintiffs themselves, on the basis of which they obtained an ad interim ex parte injunction, has to necessarily be "delivered" to the Defendant. The word `deliver‟ would necessarily mean actual physical delivery on the Defendant. The only alternative mode that the provision envisages is dispatch by registered post, immediately after the order granting injunction has been made. The dispatch by registered post as again would be of the entire set of documents as set out under Clause (a) to the proviso to Order XXXIX Rule 3 CPC. There can be no escape from complying with this provision.
11. The learned counsel for the Plaintiffs repeatedly urged that this was a bonafide mistake by associate counsel in the office of the learned Counsel for the Plaintiffs and that they should not be penalized for non- compliance with the above provision. He submits that the intention of the Plaintiffs was not to disobey the requirement of law as the entire process fee was filed as soon as the court granted the ex parte ad interim injunction.
12. The mandatory nature of the requirement of the provision has been emphasized by the Supreme Court in A. Venkatasubbiah Naidu v. S. Chellappan AIR 2000 SC 3032 and this Court in Himalaya Drug v. SBL Ltd. 1996 III AD (Delhi) 853. There is a logic behind insisting that a Plaintiff who obtain an ex parte ad interim injunction order should, at the earliest point in time, deliver to the party against whom such injunction has been granted, all the documents on the basis of which such injunction was granted. This is to enable the opposite party to know what the case CS(OS) No.1314/2009 Page 6 of 12 against it is and to approach the court at the earliest point in time to seek, if necessary, a variation of the interim order.
13. In this context following observations of the Supreme Court in Shiv Kumar Chadha Vs. MCD (1993) 3 SCC 161 are relevant:-
"34. The imperative nature of the proviso has to be judged in the context of Rule 3 of Order 39 the Code. Before the proviso aforesaid was introduced, Rule 3 said "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". The proviso was introduced to provide a condition, where Court proposes to grant an injunction without giving notice of the application to the opposite party, being of the opinion that the object of granting injunction itself shall be defeated by delay. The condition so introduced is that the Court "shall record the reasons"
why an ex parte order of injunction was being passed in the facts and circumstances of a particular case. In this background, the requirement for recording the reasons for grant of ex parte injunction, cannot be held to be a mere formality. This requirement is consistent with the principle, that a party to a suit, who is being restrained from exercising a right which such party claims to exercise either under a statute or under the common law, must be informed why instead of following the requirement of Rule 3, the procedure prescribed under the proviso has been followed. The party who invokes the jurisdiction of the Court for grant of an order of restraint against a party, without affording an opportunity to him of being heard, must satisfy the Court about the CS(OS) No.1314/2009 Page 7 of 12 gravity of the situation and Court has to consider briefly these factors in the ex parte order. We are quite conscious of the fact that there are other statutes which contain similar provisions requiring the Court or the authority concerned to record reasons before exercising power vested in them. In respect of some of such provisions it has been held that they are required to be complied with but non-compliance thereof will not vitiate the order so passed. But same cannot be said in respect of the proviso to Rule 3 of Order 39. The Parliament has prescribed a particular procedure for passing of an order of injunction without notice to the other side, under exceptional circumstances. Such ex parte orders have far reaching effect, as such a condition has been imposed that Court must record reasons before passing such order. If it is held that the compliance of the proviso aforesaid is optional and not obligatory, then the introduction of the proviso by the Parliament shall be a futile exercise and that part of Rule 3 will be a surplusage for all practical purpose. Proviso to Rule 3 of Order 39 of the Code, attracts the principle, that if a statute requires a thing to be done in a particular manner, it should be done in that manner or not all. This principle was approved and accepted in well-known cases of Taylor v. Taylor (1875) 1 Ch.D. 426, Nazir Ahmed v. Emperor AIR 1939 PC
253. This Court has also expressed the same view in respect of procedural requirement of the Bombay Tenancy and Agricultural Lands Act in the case of Ramchandra Keshav Adke v. Govind Joti Chavare AIR 1975 SC 915."
14. If the Court were to take a lenient view and not insist on strict compliance with the mandatory requirement of Order XXIX Rule 3, then CS(OS) No.1314/2009 Page 8 of 12 it would be possible for most Plaintiffs to continue to enjoy an ad interim ex parte stay in their favour for any length of time and plead genuine mistake by their counsel for non-compliance. Numerous suits accompanied by applications seeking urgent ex parte reliefs are filed in our courts everyday. The court, on a perusal of the documents filed before it, forms a prima facie view for grant of an parte ad interim injunction against the opposite party, even in the absence of the opposite party. The Court at that stage has no means of knowing what the version of the opposite party is. The court, therefore, makes such interim order both time bound and conditional. The condition is that there must be compliance with Order XXXIX Rule 3 CPC within the time specified by the court. Although Order XXXIX Rule 3(b) CPC requires the filing of an affidavit of compliance "on the day on which such injunction is granted or on the day immediately following that day", this Court has been granting a longer time accounting for the fact that the certified copy of the order passed by the court may not be available on the same day or even on the next date. However, there is no question of the Plaintiff not being required to comply with the mandatory requirement of Order XXXIX Rule 3 CPC within the time granted by the Court. In the considered view of this Court, a strict compliance with the mandatory requirement of this provision must be insisted and any laxity shown to parties might well defeat the very purpose for which such provision has been inserted.
15. The filing of process fee in this Court for service of summons/notice upon Defendants, no doubt, is another mandatory requirement of law. CS(OS) No.1314/2009 Page 9 of 12 However, that alone is not enough. If the Plaintiff wants to take the benefit of an ex parte ad interim injunction, then there is no escape from complying with the mandatory requirement of Order XXXIX Rule 3 CPC.
16. Since it is plain that the Plaintiffs have not complied with the requirement of Order XXXIX Rule 3 CPC, the interim order passed by this Court on 22nd July 2009 hereby stands vacated. IA No. 9768 of 2009 is accordingly allowed.
I.A. No. 9150/2009
17. The interim order dated 22nd July, 2009 stands vacated.
18. List this application on 27th October, 2009. IA No.11114/09(by Defendant No.7 under Order 39 Rules 1 & 2 CPC
19. This is an application by Defendant No.7 (AG Freight Carrier Pvt. Ltd.) seeking a direction to restrain the Plaintiffs from causing any impediment in the way of the Defendant No.7 carrying on its business under a changed name.
20. At the hearing of the above suit on 4th August 2009, a submission was made by counsel for Defendant No.7 that Defendant No.7 proposes to adopt „AWL Logistics India Pvt. Ltd.‟ as its changed name. The counsel for the Plaintiffs sought time to get instructions. It appears that thereafter on 16th August 2009, a letter was written by the Plaintiff No.1 to the CS(OS) No.1314/2009 Page 10 of 12 Registrar of Companies (ROC) requesting that "the name of AG Freight Carriers Pvt. Ltd. may kindly not be allowed to be changed".
21. It requires to be noted that the grievance of the Plaintiffs is that the Defendant No.7 by adopting the name of AG Freight Carriers Pvt. Ltd., is in fact infringing the trademark, trade name/corporate name of the Plaintiff No.1. Counsel for the Plaintiffs, while not denying that the aforesaid letter was written to the ROC, states that the concern of the Plaintiff is also that the Defendant No.7 should not deal with the clients/customers of Plaintiff No.1.
22. Counsel for the Applicant/Defendant No.7 has placed on record an e- mail dated 28th April 2006 by Defendant No.3 Mr. Rahul Mehra to James Minutello of Plaintiff No.1 which encloses a list of the clients of Plaintiff No.1 with whom no business was being conducted. She submits that the Plaintiff No.1 was throughout aware of the existence of AG Freight Carriers Pvt. Ltd. The copies of the e-mail dated 23rd May 2006 and e- mail dated 31st October 2007 have also been placed on record. Counsel for the Defendants states that these documents show that the only client which the Plaintiffs have referred to viz., „M/s Kohler‟ was in fact a client introduced by Defendant No.3 to Plaintiff No.1.
23. Counsel for the Plaintiffs states that he will place on record the list of clients of the Plaintiff No.1 who, according to him, are being either approached or contacted by the Defendants. He permitted to do so within two weeks by way of an affidavit.
CS(OS) No.1314/2009 Page 11 of 12
24. List this application for further consideration on 27th October 2009. IA No.12060/2009(under Order XXVII Rule 1 CPC)
25. Learned counsel for the Plaintiffs/applicants states that he wishes to withdraw this application.
26. Dismissed as withdrawn.
IA No. 12061/2009(under Order XXXIX Rule 2A CPC)
27. In view of the orders passed today, this application has become infructuous and it is dismissed as such.
IA No. 12066/2009(under Section 151 CPC by Defendant No.8)
28. In view of the orders passed today vacating the ad interim injunction granted on 22nd July 2009, this application seeking extension of that order does not survive. The Defendant No.8 may file an appropriate application seeking directions in accordance with law.
29. This application is dismissed.
IA Nos.12062, 12064 and 12065/2009
30. List on 27th October, 2009.
S. MURALIDHAR, J.
SEPTEMBER 16, 2009 ak CS(OS) No.1314/2009 Page 12 of 12