Karnataka High Court
Life Insurance Corporation vs Bangalore L.I.C. Employees Housing ... on 27 May, 1988
Equivalent citations: ILR1988KAR2817, 1988(2)KARLJ455
JUDGMENT Shyamasundar, J.
1. This appeal is from an order made by the 15th City Civil Judge, Bangalore, on I.As. 2 and 3 in O.S. No. 4369 of 1986, on the 31st of January 1987. By the aforesaid order the learned Judge, affirmed the ad interim injunction granted to the plaintiff in the suit, restraining in particular the 1st defendant from utilising for its own purpose the suit property being a vacant land measuring 51 acres in extent, situate in the City of Bangalore, during the pendency of the suit.
2. It would appear, the 1st defendant in the suit being the Life Insurance Corporation of India, (to be shortly called the 'Corporation') who is admittedly the owner of the suit plot had arranged for laying a foundation stone on the 26th of September, 1986 signifying the commencement of a project for constructing 122 houses on the suit plot for the benefit of the policy holders of the Corporation, accredited to the Bangalore Division.
3. By an ad interim injunction the Court stopped any steps being taken in furtherance to the programme of foundation laying on the 26th of September, 1986, with the result the scheme of building houses for the policy holders on the suit plot has now come to a stand still, albeit, the preliminary preparations made i.e., such as calling for tenders, awarding of contract etc., being aspects adverted to by Counsel for the appellant during the course of the argument in this appeal.
4.I shall refer to the parties as Plaintiff and Defendants, during the course of this judgment. The plaintiff and the 2nd defendant in the suit an officer called the Senior Divisional Manager, Divisional Office, L.I.C. of India, are the respondents. This appeal, however, is contested by the plaintiff, with the 2nd respondent being a mere on-looker which infact is the stance adopted by him even in the suit. Therefore the quarrel herein is only between plaintiff and the first defendant Corporation.
5. The plaintiff is stated to be a House Building Cooperative Society (to be shortly called the 'Society') patronised mainly by the employees of the defendant-Corporation working in the Bangalore Division and through the plaintiff Society they are seeking to acquire right, title and interest in the suit property on the basis of an assurance stated to have been held out by the defendant Corporation in a resolution dated 24-5-1980 or adopted by the Board of the L.I.C. approving the earmarking of the suit plot for allocation to the plaintiff Society for eventual allotment to its Members comprising of Class-Ill Officers attached to the Bangalore Division of the Corporation. It is contended that on the strength of the resolution of the Board referred to supra, the plaintiff was able to secure registration of the Society from the Registrar of Co-operative Societies and had thereafter gone about inviting applications from its Members and collecting deposits etc. But, at a subsequent stage the plaintiff sued defendant Corporation in the year 1981 for the relief of permanent injunction which suit was however, withdrawn later according to the plaintiff, with leave to file a fresh suit after the Government of India, had lifted the ban against transfer of property by the Corporation, an aspect pleaded by way of defence in that suit. The Court in that suit however, granted leave to withdraw, but did not grant specific permission to file a fresh suit on the same cause of action but said that the plaintiff can sue the defendant de novo on the fresh cause of action that may arise when the Government of India lifted the ban against alienation of property by the Corporation.
6. One of the questions arising in this suit is whether it is maintainable, as according to the defendants, it purports to be based, not on any new cause of action available as envisaged, following the Government removing the restraint against the transfer of property by the Corporation, a step which is not yet taken according to the Corporation. It is therefore, contended that the suit itself is not maintainable in view of the earlier suit having been with drawn without leave to adopt fresh proceedings on the basis of the same cause of action.
7. Be that as it may, upon noticing the activities of the defendant with reference to the suit plot of seeking to utilise it for its own purpose the plaintiff hastened to file the suit under reference and obtained the ad interim injunction referred to supra. Subsequently, upon notice being issued to the defendant Corporation, it appeared in Court, filed a written statement as also a statement of objections to the Interlocutory application for grant of temporary injunction and on both fronts it pleaded amongst other things, the suit was not maintainable because it was a renewal of the old lis that had been withdrawn without specific leave to renew and also on grounds of limitation etc. But the chief ground on which the suit mainly resisted, was on the denial of any assurance having being given by the Corporation to the plaintiff regarding allocation of the suit plot. It was sought to be explained that the communication which carried the purported assurance by the defendant Corporation regarding allocation of the suit property to the society was not addressed to the plaintiff but to the Registrar of Cooperative Societies in Karnataka with a view to help the Society to secure registration without which it could not have functioned as a House Building Co-operative Society at all. it was also contended that the said letter, written by the 2nd defendant travelled beyond the resolution if any adopted by the Corporation on 4-7-1980 and consequently the communication, itself, being ultravires could not hence be relied upon. Other contentions like want of any legal right and interest in the plaintiff to claim relief in the suit was urged pointing out inter alia that the suit itself was not being for specific performance of an agreement the prayer for a bare injunction would not suffice to clothe the plaintiff with any right, title or interest in the suit property being yet a further reason for the Court not to muzzle the defendant in the manner sought to be done was that the injunction granted against the Corporation resulted in inflicting heavy losses on the Corporation by bringing to a stand still the house building project for the policy holders by pushing up the building cost resulting in great hardship to the ultimate purchaser. It was also pointed out that the plaintiff who had no right to the suit property at all, was trying to force the Corporation to satisfy a claim that was clearly non est in law. Apart from pleading facts like balance of convenience prima facie case etc., all being in favour of the defendants, the above are the chief defences on which the defendants seek for vacating the interim injunction.
8. The learned Judge, after hearing both sides proceeded, however, to confirm the injunction holding that the balance of convenience was in favour of such continuation and that the suit itself disclosed issues worthy of being tried. He also pointed out that the Corporation-having kept the land vacant all these years could not now be heard to plead severe prejudice in keeping the land vacant till the suit was disposed off.
9. I am to mention that in the suit, the relief sought for by the plaintiff is based mainly on the ground of estoppel resting on the assurance supposedly held out by the defendant Corporation to the plaintiff society regarding allocation of suit land to the society for distribution amongst its Members as house sites. The resolution of the Corporation on which the plaintiff depends upon is yet to be placed before the Court, but instead a letter written by the second defendant to the Registrar of Co-operative Societies in Bangalore, is relied upon by bothsides. The following is the text of the letter :
DIVISIONAL OFFICE Jeevan Prakash, Jayachamaraja Road, P.B. No. 6694, Bangalore - 560 002.
July 24. 1980.
To The Registrar of Co-operative Societies, All Askar Road, Bangalore.
Dear Sir, RE: Development of Employees Housing We have 15 acres of land in three plots bought by us in Sarakki Layout from the Bangalore Development Authority.
One of the plots (Sector III) has been allotted to the insurance Corporation Employees' Housing Co-operative Society Limited, in July 1976 and they have developed the houses.
In order to have manageable societies and for various considerations, our Board has approved that the remaining TWO plots should be allotted to the following Societies :-
(1) Sector I consisting of 4.46 acres (approximately 60 sites) to BIMARASMI CO-OPERATIVE HOUSING SOCIETY, to be registered. Members of this society will be Class I Officers of our organisation.
(2) Sector 2 consisting of 5.1 acres(approximately 96 sites to BANGALORE LIC EMPLOYEES' CO-OP. HOUSING SOCIETY) in which our Class III employees will be Members).
We hereby certify that the above decision is taken by our Board in its meeting dated 24-5-1980.
We have to request you to kindly register these TWO societies.
Thanking you Yours faithfully, Sd/-
SENIOR DIVISIONAL MANAGER
10. On the basis of this letter, the plaintiff raises a plea of promissory estoppel and holds the defendants bound by it. It has hence asked for an injunction restraining the defendant Corporation from appropriating the suit land for a different purpose.
11. The learned Judge, after taking note of the contentions of the defendant-Corporation felt, that regard being had to the fact of acknowledgment by the Corporation of the contents of the letter and in not denying further the passing of a resolution touching the appropriation of land in the manner referred to in the letter, should at this stage and subject to further elucidation be treated as having committed itself to the plaintiff society regards allocation of the land, a circumstance which without more entitled the Court to hold that the plaintiff had made out a prima facie case for relief. In that context the Judge referred to a passage in the decision of the Supreme Court in EXPRESS NEWS PAPERS v. UNION OF INDIA, . He next adverted to the question of balance of convenience and held as pointed out earlier that such balance of convenience was in favour of continuing the injunction as in its view by ordering the maintenance of status quo the defendant Corporation would not suffer regard being had to the fact that land had been lying vacant ever since acquisition from the Bangalore Development Authority in the year 1978 as I understand.
12. In this appeal by the defendant Corporation Shri. S.G. Sundaraswamy, learned Counsel for the appellant maintains that the learned Judge, has totally misdirected himself in holding that the plaintiff had made out prima facie case for relief and that balance of convenience was in favour of granting an injunction against the defendant resulting thereby in the Corporation which is admittedly the owner of the suit property being prevented from putting it to beneficial use by building houses for its valued customers viz., policy holders. It is urged that the Court below had failed to take notice of the fact that the project planned by the Corporation for building houses for its policy holders was to enure for the benefit of over two lakhs policy holders as against 2000 and odd employees working in the Bangalore Division Corporation, who were seeking to wrest the suit land by preventing its appropriation to build houses for the policy holders. It is urged that the interest of the minority should necessarily yield as against the claim of the larger number of policy holders for whose welfare the Corporation, is committed just as in case of its employees.
13. Per contra Mr. Raviprakash, who appears for the plaintiff society in this Court maintains that the Corporation was trying to blow hot and cold and being an instrumentality of the State should stop indulging in such reprobatory tactics. Learned Counsel submits that the land itself having been acquired from the B.D.A. for the purpose of promoting the interests of its employees and the Corporation having passed a resolution in the year 1980 ear-making the land for the Members of the plaintiff-society, it was now seeking to back-track from its commitment to the plaintiff. In law the defendant must be held to be estopped on the principle of promissory estoppel. He joined issue on other aspects of the matter particularly, with reference to the maintainability of the suit following the withdrawal of the earlier suit and contends that this suit as also the earlier suit being one for a permanent injunction, specific leave for filing, a fresh suit was not necessary and in this connection Counsel relied on the decision of this Court in GOWRAMMA v. KRISHNA, 1973(2) KLJ SN 150. He also dwelt on the principle which is firmly established viz., that in an appeal arising from an interlocutory order granting or refusing an injunction the Court of appeal generally does not interfere with the discretion exercised by the trial Court, unless it found the exercise of such discretion to be arbitrary or capricious. Learned Counsel points out that the mode or manner in which the trial Court had exercised its discretion in this case cannot be said to be arbitrary or capricious as borne out by the order which was well reasoned and based on an appropriate consideration of all the factors that are traditionally relied upon by a Court either in granting or refusing an injunction. Mr. Raviprakash, also made it clear that his client was not very anxious that the suit plot alone should be handed over to it and that the plaintiff was ready and prepared to accept land elsewhere in Bangalore if awarded by the Corporation, which admittedly owned considerable extent of land in suburban Jeevan Bima Nagar of Bangalore. Mr. Prakash, says that if the Corporation was prepared to give an equal amount of land out of its holding in Jeevan Bima Nagar, the plaintiff would not press for its pound of flesh in securing allocation of the suit land.
14. Mr. Sundaraswamy for the Corporation did not, however, like to commit himself on these matters and stated that the counter offer if any to be made to the society would depend on the outcome in the suit.
15. Be that as it may, it seems to me that even a little advertance to the facts of this case is bound to leave one in a mazeat the turn of events wherein claim for a substantial extent of land is sought to be made on the basis of disputed premise even if true at the moment appears to be purely executory in nature. It may be seen further that the society stakes a claim to acquire right title and interest in the suit plot merely on the basts of a promise stated to have been made by the Corporation by taking a decision to allot the land to the society.
16. This is not a case of any direct agreement with the society regards allocation of land nor is it stated that the society had acquired any interest in the land consequent on the promise made to allocate land to the society. There is of course no case of this society having been put in possession in part performance of the compromise stated to have been made by the Corporation to the society. Under the circumstances the rights of the society far from being cohate and there being as yet no transaction between them which could be said to be finite, clear and categoric the question may arise as to whether in those circumstances a simple suit for injunction would suffice to sustain the claim of the society to have the land kept free from exploitation at this juncture when plaintiff is yet to acquire any right title and interest in the same. Presumably realising the vulnerability of a claim not based on actual and corporeal rights to property it would now appear, the society had made an application in the Court below for converting the suit into one for specific performance. That application having been opposed, I am given to understand the same is still pending consideration.
17. I have found it necessary to extol! these aspects in order to point out that in a case where predicting of a possible result for the plaintiff as things now stand being some what hazardous, it would be very necessary to tread with great caution the ground for grant of temporary injunction. I must point out that in the decision relief upon by learned Counsel for the society in support of the plea that the defendant Corporation was estopped from going back on its assurances regarding allocation of land to the society, none of them are cases in which a right to property was being put-forward on the basis of an executory compromise. The first of those cases relied upon by Mr. Raviprakash for the society is the one in Express News Paper's case, . In that case the question for consideration was whether the Union Government could go back on the permission granted by the then Minister for Works and Housing on the basis of which Express News Papers had constructed a new building with an increased floor area and a double basement both of which were in conformity with the permission granted by the lessor i.e., the Union of India, it was therefore held that the lessor was later precluded from contending that the order of the Minister was illegal or improper, by the application of the doctrine of promissory estoppel. The decision in DELHI C & G MILLS LTD. v. UNION OF INDIA, was a case where the Railways had assured the appellant-company that if it set up a fertilizer company at Rajasthan, the railways would then charge a rate beneficial to the company for transporting a chemical called 'Naptha' in railway wagaons to the factory site. This assurance, it transpires had been given by the railways to the company even before it had set up the factory at Kota and was given in the context of a request made by the company for such concessional treatment. It later turned out when the factory was ready for being commissioned the company having made a request for charging concessional rates for transporting Naptha, as earlier agreed, the railways declined the request and hence the claim for holding railways bound to their earlier assurance, regard being had to the fact that the company had fully acted upon the same. Under those circumstances, the Court held the, railways bound to the assurance given earlier in the context. The Court made in that enunciation the following observations:
"The Court, however, would compel the opposite party to adhere to the representation acted upon or abstained from acting. The entire doctrine proceeds on the premise that it is reliance based and nothing more.
xx xx xx xx The concept of detriment as it now stands is whether it appears unjust, unreasonable or inequitable that the promisor should be allowed to resile from his assurance or representation, having regard to what the promise has done or refrained from doing in reliance on the assurance or representation."
The two decisions referred to herein and the one cited by Mr. Sundaraswamy in M.P. SUGAR MILLS LTD. v. STATE OF U.P., AIR 1971 SC 621 which was followed later by the Supreme Court in UNION OF INDIA v. GODFREY PHILLIPS INDIA LTD., none of them were cases where on the basis of estoppel or promissory estoppel, title to immoveable property was sought to be founded. But on the other hand they were all cases where the doctrine of estoppel was involved for the purpose of enforcing recognition of a pre-existing state of affairs that had arisen or already ushered in by a promise made or assurance given by the promisor. The aforesaid distinction, the facts of this case do admit vis-avis, the decisions referred to supra, has got to be borne in mind.
18. Even so, while not losing sight of the fact that at the moment, I am to decide an appeal from an interlocutory order, granting the injunction against the defendant in a suit on the basis that the plaintiff had established a prima facie case and that the balance of convenience was in favour of granting such an injunction, I have adverted to these special features of this case in the foregoing passage, only to point out the unusual nature of the claim made for garnering property rights and the some-what striking characteristics which make it a little different from the mill of the run cases which Courts are accustomed to deal in this regard. A pronounced feature of this case and the result of the temporary injunction now granted by the Court is to muzzle the owner of the land from using it as it likes subject, of course to (imitations of building laws and regulations. It may be pointed out, law itself forbids a transfer of property burdened with a clog against alienation. Section 10 of the Transfer of Property Act, is in point. If therefore, with the law it self frowning on any condition or term which ties up the hands of the land-owner in the matter of disposal, it may be pertinent to ask whether an injunction can be or should be issued against appropriation of one's own land by the owner at the instance of a person or body which is yet to make out a discernable right that is finite and tangile in law. The defendant Corporation is admittedly the owner of the suit property. The plaintiff is yet to acquire rights in the property. It has not advanced any right to the same on the basis of the part performance of an agreement and nor has it in its hands any written agreement under which the defendant had committed itself to the plaintiff. Matters being in such a flux state the question is whether a temporary injunction should have been issued restraining the defendant Corporation from exploiting its own property as has now been done.
19. Granting that these facts which are some-what unusual in nature, admit of evaluation in the context of the prayer for temporary injunction appropos the usual para meters viz., prima facie case, blance of convenience etc., now what should be done is to evaluate facts as they stand, on the basis of the aforesaid norms.
20. Mr. Raviprakash, appearing for the plaintiff, however, cautions me again by saying that this being an appeal from an interlocutory order unless it can be said the order or the findings are so arbitrary or capricious, I should not interfere with the same even granting that it is open to me to come to a different conclusions on facts. Strong reliance is placed by Mr. Prakash on the decision of his Lordship Mr. Justice Hon'ble Venkataswamy, J. (as he then was) in RANGAMMA v..KRISHNAPPA, 1968(1) KLJ 553 and a later decision of this Court in LALITHAKSHI v. SADASHI-VAPPA, wherein Sabhahit, J. (as he then was) followed the decision in Rangamma v. Krishnappa., 1968(1) KLJ 553 But, then as pointed out by Shivashankar Bhat, J. in MITRAVRINDA v. D.C. BANGALORE DISTRICT & ORS., 1987(2) KLJ 121 whereas the grant or refusal of a discretionary order like a stay is no doubt a matter of judicial discretion, but, if that discretion is found to have been exercised or not exercised as a result of wrong approach, such an order is liable to be set aside. It therefore seems to me that if ultimately the order is or can be said to be vitiated by a wrong approach then there is little that can deter this Court from interfering with the impugned order and infact it may even be its duty to do so.
21. With these observations I shall now address myself to the question debated in this case being whether the order of the Court below was justified and whether it has been arrived at after recourse to the appropriate norms or para meters. In this connection, it would be useful to invite attention to the celebrated decision of the House of Lords in AMERICAN CYANAMID CO., v. ETHICON LTD., ILR Karnataka 1976(1) 426 This decision is noted both for its literary excellence as also for its legal content. It would appear till the advent of this decision, in England the practice was to embark upon a meticulous scrutiny of the case for the plaintiff in a quia time action for an injunction to see whether the plaintiff's case was so fool-proof that it was bound to result in securing the ultimate relief sought for in the proceedings. In other words, if the plaintiff had a case strong enough to ensure its ultimate success in the suit, then only a temporary injunction of the like nature would be granted. In the decision referred to supra, the House of Lords entertained the appeal in question after the trial Judge and the Court of appeal had differed in their views as to the grant of a temporary injunction to examine particularly the question as to whether consideration of other ensuing questions would merit consideration only if the case of the plaintiff was virtually fool-proof in nature. That was a case in which the plaintiff American Cyanamid had a patent in certain surgical sutures. It feared that a produce put-forward by the defendant Ethicon Ltd., engaged in the production of a similar product would interfere with its own trade and cut into its profits. It therefore, brought an action to restrain the defendant from trading in that article. In the context, it also applied for a a temporary injunction. The trial Judge, granted the same, but on appeal it was vacated and on a further appeal to the House of Lords the decision of the trial Judge, came to be restored.
22. The utility of this decision to Courts in this Country has been succintly pointed out in the Editorial note of the Indian Law Reports Karnataka series appended to this decision preceding the report as under :
"The pronouncement of the House of Lords in American Cyanamid v. Ethicon Ltd., (Law OR. Vol. 91 April 1975 page 168) in its reaffirmation of the true principles underlying the grant of interlocutory injunction is of particular relevance and value to our Courts which are constantly called upon to administer this much misunderstood and misapplied form of interlocutory remedy. The significance of American Cyanamid consists in the reaffirmation of the twin principles ; the first, the need to eliminate, at this stage, the time consuming 'mini-trial' to assess the strength of the imperative but often disregarded, need to protect the party against whom the interlocutory injuction is granted by putting the opposite party on terms.''
23. Why and when an injunction is granted, the nature and content of an injunction are so lucidly set-out in that decision so as to merit reproduction hereunder :
"My lords, when an application for an interlocutory injunction to restrain a deft, from doing acts alleged to be in violation of the plaintiffs legal right is made upon contested facts, the decision whether or not to grant an interlocutory injunction has to be taken at a time when exhypothesis the existence of the right or the violation of it, or both, is uncertain and will remain uncertain until final Judgment is given in the action. It was to mitigate the risk of injustice to the plaintiff during the period before that uncertainty could be resolved that the practice arose of granting relief of interlocutory injunction; but since the middle of the 19th century this has been made subject to his under-taking to pay damages to the defendant for any loss sustained by reason of the injunction if it should be held at the trial that the plaintiff had not been entitled to restrain the defendant from doing what he was threatening to do. The object of the interlocutory injunction is to protect the plaintiff against injury by violation of his right for which he could not be adequately compensated in damages recoverable in the action if the uncertainly were resolved in his fayour at the trial: but the plaintiff's need for such protection must be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately compensated under the plaintiff's undertaking in damages if the uncertainly were resolved in the defendant's favour at the trial. The Court most weigh one need against another and determine where 'the balance of convenience' lies."
The use of such expressions as "a probability" "a prima facie case" or "a strong prima facie case" in the context of the exercise, of a discretionary power to grant an interlocutory injunction leads to confusion as to the object sought to be achieved by this form of temporary relief. The Court no doubt must be satisfied that the claim is not frivolous or vexatious; in other words, that there is a serious question to be tried.
His Lordship then went on to state if on the material available at the preliminary hearing Court is satisfied that plaintiff had some chances of success in the suit, it must then proceed to consider whether balance of convenience lies in favour of granting or refusing the interlocutory relief sought for.
24. The preventive remedy of injunction is thus granted as an instant antidote to stop or prevent the invasion of the plaintiff's rights in regard to which a complaint is made. The Court having regard to the expediency involved should not embark upon a nit-picking operation at that stage by holding a Mini trial to lay thread-bare the case of the plaintiff to find out if a prima facie case is made out or not. it would be sufficient if the Court is assured that questions raised by the plaintiff are not vexatious or too casual, but are such as to merit serious consideration at a subsequent stage. That such is the content and frontiers of the expression prima facie case is also the view of Govinda Bhat, J. (as His Lordship then was) in the case of STATE OF KARNATAKA v. S. VENKATARAJ, 1975(1) Kar.L.J. 142 and Jagannatha Shetty, J. (as His Lordship then was) in J. KRISHNAMOORTHY v. BANGALORE TURF CLUB., ILR Karnataka 1975, 1957
25. But at the same time in exercising its discretion the Court must be totally circumvent and exercise extreme caution being unmindful of the fact either grant or refusal of the remedy will cause some harm or inconvenience to one side or the other. My experience in this Court, while over-seeing the exercise of this jurisdiction has left me convinced that despite the guide-lines and welt laid out principles covering exercise of this jurisdiction, Courts I note with regret have been administering the same like the proverbial Chancellors foot of yore.
26. Applying herein the test of prime facie case as connoting the existence of a serious issue to go in to trial, the question now is whether any such serious issue was raised in this case. The learned Judge has found that the resolution of July 1980 by the Board which was yet to be produced in the suit, was sufficient to invest a right in the society or to create an interest in the suit property in favour of the society so as to occasion a fuller investigation of the matter invoking in aid the principle of promissory estoppel. He therefore thinks there was a prime facie case, but then regrettably, he did not indicate whether in his view there also existed any indicia regarding existence of the requirement for founding an estoppel on the basis of the representation made or assurance given. He does not appear to have pointed out what changes the plaintiff had made in terms of the resolution passed in the month of July 1978 by the Corporation. But, I do not wish to venture into that aspect of the matter, since it may yet be open to the plaintiff to show what changes it had made on the basis of the defendant's acts, although in the arguments all that Mr. Raviprakash was able to point out was that the society had secured registration and had thereafter invited applications for allotment of sites. Whether these acts or steps taken by a House Building Society can be said to be steps taken pursuant to any assurance given by the Corporation or whether they were simply instances of trading activities by a society, done in the usual course are matters regarding which I would not like to subscribe my views at this stage.
27. But in this connection I am however, bound to notice an argument now advanced before me by Shri Sundaraswamy, learned Counsel for the Corporation that there can be no estoppel of any kind precluding any authority from changing or revising its policy in regard to any matter under its consideration and that estoppel cannot hinder formation of policy, since it appears to strike at the very vitals of the plaintiff's case resting on the principle of estoppel.
28. I am to recall that in the Express News Paper's case, on which Mr. Raviprakash, relied upon their Lordships indicated therein an important limitation against the operation of the doctrine of estoppel making it clear that it did not operate at the level of Government policy. This aspect of the matter is highlighted in para 182 at page 949 in these terms :
"Another limitation is that the principle of estoppel does not operate at the level of Government policy. Estoppels have however been allowed to operate against public authority in minor matters of formality where no question of ultra vires arises : Wade, Administrative Law 5th Edition pp 233-34
29. The limitation against estoppel based on reversal of Governmental policy or change in Government policy was upheld by the Court of appeal in England in LAKER AIRWAYS LTD., v. DEPARTMENT OF TRADE, 1977 OB 643. That was a case in which a Government department encouraged and induced a private airline to invest in the purchase of aircraft on the under-standing that the licence for operating the airline would be continued, but following a change in the Government and a reversal of the earlier policy, the licence granted earlier was withdrawn. The question for consideration was whether Government was estopped from discontinuing the licence. Of the three Judges, who were associated with that decision excepting Lord Justice Denning, the others rested their decision also on the applicability of the principle of estoppel. The two other Judges Lord Justice Roskill and Lord Justice Lawton, held that there was no estoppel and gave the following reasons. Lord Justice Roskill said:
"As Lawton L.J. says at the conclusion of his Judgment, the doctrine of estoppel cannot be allowed to hinder the formation of Government policy - or, one might add, the constitutional result of a general election."
Lord Justice Lawton said:
"I add only a short commencement on the issue of estoppel. Whatever representations the Secretary of the State in office between 1972 and 1974 may have made to Laker Airways Ltd., he made them pursuant to his public duty and in good faith. If in 1976 his successor was of the opinion that the public interest required him to go back on those representations, he was in duty bound to go back on them. The fact that Laker Airways Ltd. suffered loss as a result of the change is unfortunate; they have been the Victims, of a change of Government policy. This often happens. Estoppel cannot be allowed to hinder the formation of Government policy."
30. The above principle as adverted by the author HWR Wade in his treatise on Administrative Law having been accepted by the Supreme Court in Express News Papers' case, referred to supra, it seems to me that if there was a change in the policy and the L.I.C. now thinks that it would do welt to build houses for the policy holders rather than leave the land to be utilised by its employees there is little ground to plead any estoppel against the Corporation. But then it is urged that no resolution of the Board has been placed before the Court to show that the Board had revised its policy in regard to utilisation of the said land. It is pointed out that in the pleading all that is alleged i.e., in the written statement is that the Bangalore Development Authority having issued a notice to the Corporation in the year 1985 threatening to re-acquire vacant land the Corporation immediately took a decision to appropriate it for building houses for its policy holders. It is also pointed out that the Corporation had been through out pleading that the transfer of land sought for by the Society was not possible because of a ban imposed by the Government of India, the ban was still in force and if that was so, the present conduct of the Corporation saying that it would use the land to build houses for its customers and not give it to employee's was clearly untenable. It is argued that the Corporation has in this mariner been taking a highly incongruent stand most unbecoming of an instrumentality of the State. It is sought to be urged that there is no resolution of the Board revising its earlier policy of ear-making the land for its employees and authorising a different use in lieu thereof and hence the change of policy as a bar for relief is clearly without an without any substance.
31. But then it is common ground that the Corporation had now set out to use the land for building houses for its customers. The suit itself came to be filed in the context of the function organised by the Corporation for laying the foundation stone to signal the commencement of the project for building houses for its policy holders. There can hence be little doubt that the Corporation has now changed its mind in regard to the earlier decision if any of ear-marking land for allocation to its employees. A change in policy can be implicit and need not always.be explicit. A change of policy can be inferred even without so much being stated in words. Conduct can spell out the same indication being that what is now sought to be done not tying up with something that was planned earlier.
32. It therefore seems to me that the policy change herein although implicit was made clear by the specific disclosure of the mind of the Corporation signalling the commencement of the project for building houses for the policy holders. Even if no resolution was adopted by the Corporation rescinding the earlier resolution of July 1980 and supplanting it by a new resolution authorising user of land for a different purpose, the very fact that the Corporation was to the knowledge of the plaintiff planning to start a project for the benefit of the policy holders impliedly connoted a change of policy. That a policy change can be implicit and need not always be explicit becomes clear from the decision of the Supreme Court on which Mr. Sundarswamy, relied upon in the case of STATE OF U.P. v. VIJAY BAHADUR SINGH, . That was a case in which the State Government had refused confirmation of an auction sale of authorised lots following the acceptance of the higher bid. The Government, however, chose instead to allot the authorised lots to the Forest Corporation. That auction being challenged before Court, it was held:
"The Government was entitled to change or revise its policy subsequent to the acceptance of the provisional bid. The Government therefore, could refuse to accept the highest bids and could allot the lots to the Forest Corporation and thus implement the policy of legislature envisaged by the U.P. Forest Corporation Act (4 of 1975). Even if there was no express policy decision of the Government recorded after the date of auction it was implicit in the very action of the Government in cancelling the auction and allotting the forest lots to the Forest Corporation,"
33. The pronouncement by the Supreme Court as aforesaid leaves little doubt that revision of policy may be implicit and that the same can be deduced from the conduct of parties. Therefore in this case the Corporation having now admittedly decided to use the land for building houses for its policy holders it becomes evident that it has given up its earlier policy if any of allotting this land to the employees of the society and in those circumstances the principle of promissory estoppel cannot preclude the Corporation from acting on the basis of its revised policy and it can no longer be pegged down to any earlier decision on the basis of promissory estoppel. That in such cases a change of policy might even affect others adversely but the same cannot deter the authority as pointed out by the decision in Laker Airways case supra, 1977 OB 643 cannot be a ground for ignoring the change in policy to hold the promissor bound by the earlier promise. Therefore it has got to be held that the doctrine of promissory estoppel cannot be relief upon therein at all.
34. This conclusion should at once lead to free the defendant's hands from the manacle sought to be forced on the defendant by the plaintiff on the basis of the estoppel theory which would then leave plaintiff as things now stand without any serious question to plead at the trial. But then, I am told the plaintiff has now sought leave to amend the plaint by including therein a prayer for specific performance and that the said prayer is keenly opposed in the Court below. Be that as it may, it thus becomes clear that the prima facie case on which the plaintiff has so far relied upon must now be treated as having been whittled down considerably and that should in itself suffice to vacate the impugned order.
35. But then I do not propose to do so and instead pass on to consider the further question that has engaged the learned trial Judge's attention being the question of balance of convenience.
36. On this aspect of the matter, the learned, Judge, appears to think that the balance of convenience lay in granting the injunction rather than in refusing it because, he felt that if the injunction was granted what merely followed was only some delay in the execution of the defendant's plans for building houses for the policy holders. On the other, he pointed out that if the injunction was refused thus leaving the defendants free to carry on with their plans, the same would result in grave hardship to the plaintiff who will then lose the suit land resulting in such total loss that in law cannot be compensated adequately. The learned Judge, in para 8 of the Judgment deals with this aspect thus:
"Now coining to balance of convenience and hardship, these cannot be weighed or measured in fine and golden scales. However even on this score, it is the plaintiff and not the defendants who is entitled to succeed. As already pointed out above, the plaintiff society was formed and registered solely and exclusively for securing the suit land and no other land, for formation of sites thereon and allotment of the Sites to the Members. As per Bye law No 2 of the Society its jurisdiction and activities are confined and restricted to the suit land allegedly promised for allotment to it as long back as in 1980. After having made it wait for nearly 7 years, with almost bated breath, its very existence is sought to be jeopardised by revising the alleged decision and approval for allotment in its favour by covering the suit land with houses for policy holders. Whether there is jurisdiction for such a swing on the part of the defendants and whether it is in fact a breach of a legal obligation or whether they are bared by the doctrine of promissory estoppel are all serious questions entailing a deeper probe on merits at the trial of the suit. If pending such adjudication, the very topography of the suit land were to be changed or effaced, it cannot be argued that plaintiff can seek damages. Apart from the Defendants merely having called for tenders, there is nothing to show that in fact agreements have been entered into with the advances paid to contractors or builders. Hence the defendants, staying their hands for some more time and not proceeding with the execution of their scheme in favour of their policy holders and against their own employees, wilt certainty not subject them to any hardship worth the name. As against this, the very suit of the plaintiff will become infructuous if pending Its disposal the suit land were to be converted into a colony of policy holders."
37. It seems to me the learned Judge, did not consider the aforesaid aspect of the matter in the proper perspective. There is in the plaint itself a reference to the almost inexhaustible means of the defendant which is undoubtedly a financial institution having at its disposal vast funds to draw upon. It is said that even now the defendant Corporation has ample vacant land in Jeevan Sima Nagar, at Bangalore. In fact, Mr. Ravi Prakash, learned Counsel for the plaintiff made it clear that his client was prepared to accept land in Jeevan Bima Nagar, in lieu of the suit land and that they were not keen on forcing the issue regarding suit land but that the plaintiff would be satisfied if it is given lands elsewhere in Bangalore. It is pointed out the defendant having the wherewithal both in cash and kind to satisfy the needs of the plaintiff, for the gauntlet of wasteful litigation was still being flung at it by the defendants instead of crying a haft to a policy of vengeful reaction against the plaintiff society.
38. Mr. Sundaraswamy, learned Counsel for the Corporation does not deny the Corporation has the means to satisfy the plaintiff's demand even otherwise but says that the Corporation will not buckle down to such strong arm tactics by any person and submitted that the question of offering alternative land to the plaintiff, or finding other alternatives to require its needs would arise only in the event of there being a decree in favour of the plaintiff and not otherwise.
39. While, I do not wish to be drawn into this controversy, I would however like to rely on these facts i.e., the defendant being in a position to offer alternative land to the plaintiff and that even otherwise, the defendant having the means to compensate the plaintiff adequately in the event of the suit land not being available for its use, in order to demonstrate that balance of convenience clearly lay in favour of refusing the injunction rather than of granting. The suit no doubt is one for a permanent injunction, but then in the circumstances the relief to be eventually awarded can always be moulded is trite law. If the defendant is allowed to build and thus render the suit land unavailable for the plaintiff notwithstanding its success, a permanent injunction may not be granted but in lieu thereof there can always be a direction to compensate the plaintiff adequately as indicated above. The matter admitting of such simple resolution, it appears, to have nonetheless escaped the notice of the learned trial Judge I must at this stage go back to the decision of the House of Lords in American Cyanamid Company's case, ILR Karnataka 1976(1) 426.
39. As already pointed out Lord Justice Diplock after declaring that there was no rule as was believed that the existence of a strong prima facie case was the basis for the grant of an interlocutory injunction, then went on to indicate as to what was the governing principle underlying a finding in regard to balance of convenience. Following is the enunciation made in that behalf :-
"17. As to that, the governing principle is that the Court should first consider whether if the plaintiff were to succeed at the trial in establishing his right to a permanent injunction he would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendants' continuing to do what was sought to be enjoined between the time of the application and the time of the trial. If damages in the measure recoverable at common law could be adequate remedy the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted, however, strong the plaintiff's claim appeared to be at that stage. If on the other hand, damages would not provide an adequate remedy for the plaintiff in the event of his succeeding at the trial, the Court should then consider whether, on the contrary hypothesis that the defendant were to succeed at the trial in establishing his right to do that which was sought to be enjoined, he would be adequately compensated under the plaintiff's undertaking as to damages for the loss he would have sustained by being prevented from doing so between the time of the application and the time of the trial. If damages in the measure recoverable under such an undertaking would be an adequate remedy and the plaintiff would be in a financial position to pay them, there would be no reason upon this ground to refuse an interlocutory injunction.
18. It is where there is doubt as to the adequacy of the respective remedies in damages available to either party or to both, that the question of balance of convenience arises. It would be unwise to attempt even to list all the various matters which may need to be taken into consideration in deciding where the balance lies, let alone to suggest the relative weight to be attached to them. These will vary from case to case."
Continuing on this His Lordship said:
"Save in the simplest cases the decision to grant or to refuse an interlocutory injuction will cause to whichever party is unsuccessful on the application some disadvantages which his ultimate success at the trial may show he ought to have been spared and the disadvantages may be such that the recovery of damages to which he would then be entitled either in the action or under the plaintiff's undertaking would not be sufficient to compensate him fully for all of them. The extent to which the disadvantages to each party would be incapable of being compensated in damages in the event of his succeeding at the trial is always a significant factor in assessing where the balance of convenience lies; and if the extent of the uncompensatable disadvantage to each party would not differ widely, it may not be improper to take into account in tipping the balance the relative strength of each party's case as revealed by the affidavit evidence adduced on the hearing of the application. This, however, should be done only where it is apparent upon the facts disclosed by evidence as to which there is no credible dispute that the strength of one party's case is disproportionate to that of the other party. The Court is not justified in embarking upon anything resembling a trial of the action upon conflicting affidavits in order to evaluate the strength of either party's case."
40. Balance of convenience is thus not something akin to a tradesman's scales to be manipulated adroitly but as indicated in the decision supra it is the resultant anticipation by the Court in an objective manner of the concomitant hardships experienced by the one vis-a-vis advantages secured by the other party subject to there being clear chances of mitigating in some manner the hardship endured pendente lite by one or the otherside and the prospect of being adequately compensated should preeminently be the primordial factor guiding exercise of discretion one way or the other.
41. The aforesaid principles when applied herein should lead to the conclusion that there was really no ground and not even an ostensible one for granting a temporary injunction restraining the Corporation from going ahead with its plans of exploiting its own property for the benefit of its customers. For the present it is enough to rely on the ground of balance of convenience alone, to vacate the temporary injunction although, as I have pointed out earlier on the question of estoppel the plaintiff's case being found to flounder, it is left without any serious case for pleading at the trial as things now stand. But then even on the basis that it had something substantial to commend to the Court at the trial, the balance of convenience is really against granting of the injunction and that would be the result arrived at once the basis of the yardstick that should have been applied by the Court below, the norms being as indicated supra viz., that for the injury or loss sustained by the plaintiff by the action of the defendant in appropriating the land for its own use, the plaintiff can be compensated adequately by the Corporation regards whose means to compensate the plaintiff, to its heart's content, there can never be any doubt at all. It therefore becomes evident that the balancing factor of convenience was clearly against granting the injunction.
42. In this context I am bound to note the hazardous result attendant on the grant of the injunction and call attention to the fact that each day the defendant's project gets delayed, it will add to the escalating costs of house construction which is sky-rocketing daily,a factor which is so notorious, that no Court can avoid taking note of. Increased costs go to inflating the sale price ultimately to be paid by the policy holders for whom the houses are built and that would be so even on a break-even policy of no-loss no-profit system. If thus, the result of the injunction is to make the ultimate beneficiary groan under the weight of the underable cost of purchase price, but on the other hand the clearance of the defendants project would not make any dent in the plaintiff's fortune in the event of its success in the suit because the Corporation can always be ordered to make good the loss by placing alternative land at the disposal of the society or pay the value thereof so that the society can buy land of its own choice elsewhere in Bangalore City. Viewed from this angle, it becomes clear that the balance of convenience always lay in favour of refusing the injunction rather than in granting it. Having regard to my views as aforesaid, it becomes evident that the temporary injunction granted by the Court below is thoroughly unsustainable and has got to be vacated. As already pointed out, I am not inhibited in any manner in interfering with the order of the Court below, because the order is vitiated by adoption of the wrong perspective or approach and, therefore, it becomes the duty of the Court to interfere with such an order as pointed out by Shivashankar Bhat, J. in Mitravinda's case, 1987(2) KLJ 121 which was a Writ Petition arising under Article 226 of the Constitution from a discretionary order refusing to grant stay and even in such a proceedings, His Lordship felt compelled to interfere because the Court below had adopted a wrong approach and to enable interference with the impugned order, His Lordship depended on the authority in American Cynamide's case, ILR Karnataka 1976(1) 426 as could be seen from para 12 thereof.
43. White the above does suffice for vacating the temporary injunction granted by the Court and in consequence to allow this appeal, it seems to me that I must take this opportunity, for calling. attention to a frequent omission to which our Courts are always invariably suceptible to Lord Justice Diplock in the course of the Judgment in Cyanamid's case, ILR Karnataka 1976(1) 426 referred to supra has pointed out to the salutary practice of the Courts in England making always as a rule an order granting an interlocutory application only on terms so that hardship to the defendant if any caused by the infliction of an interlocutory injunction can be mitigated to some extent in the event at the conclusion of the trial it is proved that the grant of the interlocutory injunction was unjustified.
44. I have in the course of this Judgment earlier drawn attention to the observation of his Lordship emphasising the need to make an interlocutory injunction on terms so that, in case the making of the order turns out to be a misadventure the defendant can still be compensated for having suffered an undue restraint of his liberty or right to enjoy ones own property. Very pertinently attention to this common deficiency affecting orders of an interlocutory nature made by the Courts in this Country has been highlighted in the Editorial note accompanying the decision in American Cyanamid's case, ILR Karnataka 1976(1) 426 as published in the Indian Law Reports Karnataka Edition, I must in this connection advert to the following observation of the learned editor:
"The principle underlying the necessity of protecting the interests of parties affected by the grant or denial, as the case may be by putting the opposite party on terms, is merely a concomitant of the true principles that emerge from these and other rulings. Despite the clear man. Hate the laxity of the manner in which this remedy is administered has invited criticism."
xxx xxx xxx xxx The practice of requiring an undertaking as to damages upon grant of interlocutory injunction was that it aided the Court in doing that which was its great object, viz.. 'abstaining from expressing any opinion upon the merits of the case until the hearing/ but protected the plaintiff against uncompensatable disadvantage."
45. There can be no doubt that the above observations are well warranted, highlighting as they did, the sadly neglected part of the discipline regarding granting of interlocutory injunction. It is needless to add that any Court exercising jurisdiction in this behalf excludes this exercise at its own peril. The need to make an interlocutory injunction on terms has been again high-lighted very recently in England in ATTORNEY GENERAL v. WRIGHT AND ORS., 1987(3) All.E.R. Ch.D.579. In that decision it has been pointed out that even the Attorney General as a suitor on behalf of the crown was not exempt from the ken of this salutary principle viz., that the Court should protect the interest of the defendant whose liberty may turn-out to have been unjustly restricted. In the course of the Judgment Their Lordships referred with approval to the observations of Lord Justice Diplock in Hoffmann La Roche's case, 1974(2) All.E.R. 1128 in the following terms:
"As Lord Dipiock explained in the Hoffmann La Roche case (1974) 2 All ER 1128 at 1150, (1975) AC 295 at 361 the purpose of the cross undertaking is to avoid or mitigate the risk injustice to a defendant against whom a Court has granted an interlocutory injunction without full investigation of the facts or law. If it appears at the trial that the plaintiff was not entitled to relief, the cross-undertaking enables him Jo be compensated for loss which he has been caused by the existence of the injunction. The principle is therefore that Court should protect the interests of a defendant whose liberty may turn out to have been unjustly restricted."
The apparently well supported principle of making an interlocutory order subject to terms appears to have fallen into disuse in our Courts, I need hardly state that it is time that we emulate an extremely considerate and well conceived principle enunciated by Courts in England of making an interlocutory injunction on terms so that the defendant, or even a plaintiff who suffers by the grant or refusal of an unjustified interlocutory injunction is not exposed to further bouts of litigation to seek recompense for his travails and tribulations suffered at the hands of a freewheeling plaintiff indulging in a no-holds-barred venture. The Judgment under appeal, I must notice is no exception to the ordinary run of orders made on an interlocutory application without subjecting order to terms. While the defendant can undoubtedly compensate the plaintiff for causing any loss or injury sustained by its action, the same cannot be said of the plaintiff with equal fervour. After obtaining the injunction the litigation pends for years as can be expected and finally, the verdict is against the plaintiff, would result in the owner of the land being compelled not to exploit its own property and in this case to confer benefaction on its customers would be made to pay very dearly for any benefit a few years, hence the plaintiff admittedly not being in position to mitigate an obvious hardship will have only had the sadistic satisfaction of keeping at bay the defendant for nothing at all. The non-consideration of these facets was clearly a gross error for the correction of which I am bound to interfere, if not for any other reason.
46. In the result, therefore, and for the reasons aforesaid, this appeal succeeds and is allowed. The order dated 31st January 1987 made in O.S. No. 4369 of 1986 on I.A.III is hereby set-aside, resulting in the temporary injunction granted against the defendants therein restraining them from putting up constructions for the benefit of the policy-holders on the suit plot shall hereby stand vacated. The Court below will, however, expedite the disposal of the suit and is directed to dispose it off within six months from the date of receipt of this order.
47. Costs in this appeal will be costs in the cause and will abide by the final result in the suit.