Allahabad High Court
Managing Director U.P. State Bridge ... vs Sri Neeraj Upadhyaya S/O Sri Vijendra ... on 25 May, 2007
Equivalent citations: 2007(4)AWC3840
Author: Amitava Lala
Bench: Amitava Lala, V.C. Misra
JUDGMENT Amitava Lala, J.
1. This appeal is arising out of an interim order of injunction passed under Order XXXIX Rule 1 of the Code of Civil Procedure (hereinafter in short called as "C.P.C.") by Civil Judge (Senior Division), Varanasi on 29th March, 2007 in a suit being Original Suit No. 1220 of 2006 (Neeraj Upadhyaya v. Managing Director and Anr).
2. The fact remains that the appellant No. 2 is collecting toll tax from the concerned bridge constructed as per the scheme of the State Government. From 2002 to 2004 the collections were Rs. 8,37,04,210.00, Rs. 8,51,80,415.00 and Rs. 8,77,22,695.00, but in 2005 and 2006 the collections of toll tax were Rs. 7,09,14,305.00 and Rs. 7,42,59,505.00. After enquiry the appellants found that because of diversion of vehicles the income by way of toll tax was substantially reduced. However, with effect from 01st January, 2007 additional toll tax of Rs. 5/- was introduced. In any event, the appellants explored the possibility of engaging a private enterprise for the purpose of collection of toll tax. A decision was taken and a tender was floated. The floor-price of the tender was fixed at Rs. 9,00,00,000.00 since the corporation itself was able to earn upto the extent of Rs. 8,77,00,000.00. The respondent No. 1 submitted the tender with the earnest money offering a bid of Rs. 6,72,01,000.00, which was the highest bid. The corporation refused to accept such price since it was much below not only than the floor-price but also than the highest collection of toll tax made by the corporation itself.
3. It is well settled by now that the highest tenderer can not claim any right to get a tender as a matter of course, therefore, he can not compel a governmental authority to give so. Moreover, in the facts and circumstances, it is not feasible for a governmental authority to accept such tender, which will ultimately cause loss of public revenue, if engaged, not only for the quoted price but also on account of payment of agents' commission. The only ground, which could have been taken by the respondent, is that whether ground of refusal is backed by any cogent reason or not because in a case of contract or no contract the governmental authority will have to act fairly, reasonably and without any discrimination. This principle is well settled in many judgments particularly in (Mahabir Auto Stores and Ors. v. Indian Oil Corporation and Ors.) and thereafter upto the date.
4. Assuming for the moment, the aggrieved feels that he has legitimate expectation that his tender will be accepted by the corporation, he could have, at best, move to the High Court under Article 226 of the Constitution of India to apply the high prerogative writ thereunder for the purpose of sending the matter back to the Governmental authority for consideration of cause applying the principles of equitable justice, but he can not have any accrued right to compel a governmental authority to accept his tender against the above factual background by way of suit. In a suit question of law and equity both are to be taken into account. Therefore, when law does not exist, equity alone can not withstand.
5. Against this background, a suit, being Original Suit No. 1220 of 2006, was instituted in the civil court in the nature of suit for injunction praying inter alia as follows (as per the translated copy of the plaint supplied by the party):
A. The defendant No. 1 be restrained by the decree of permanent injunction to the effect the performed legal auction dated 16.12.2006 be not cancelled on the contrary if the highest bid of the plaintiff is less the after negotiation, stopping the toll tax collection, according to government order, the toll tax collection on the bridge in question, the defendant No. 1 transfers the same to the plaintiff or during the pendency of case the defendant after doing negotiation with plaintiff, fixing the instalment day by day on total amount obtained in one year, on paying 186/2 crore by the plaintiff to the defendant No. 1 or depositing the fixed security amount, from the date of payment according to rules the work of toll tax collection the defendant No. 1 transfers to plaintiff. The plaintiff will deposit the fixed installment for day by day on the beginning of every week in the office of defendant No. 1.
B. Issue any other relief which this Hon'ble may deem fit in favour of plaintiff against the defendant No. 1.
C. Award the total cost of case to the plaintiff from the defendant set No. 1.
6. Immediately after filing of the suit, the contesting respondent herein had filed an interlocutory application praying inter alia similar relief and at an interim stage on 04th January, 2007 following order was passed (as per translated copy supplied by the party):
The defendant may file the statement of collection in the court made earlier within 15 days. The plaintiff on account of being highest bidder the collection of 9 crore per year on the basis of proportionate day by day toll tax collection is ordered. The defendant may issue license for toll tax collection after getting deposited advance money of 15 days from the plaintiff. This arrangement is made temporarily till the application 6-C is decided finally, and seeing the loss of revenue and burden on the public, is being made. If the plaintiff does not comply it the plaintiff will have no right to collect toll tax.
The record be produced for 2.3.2007 for disposal.
7. Thereafter finally the order impugned was passed on 29th March, 2007 as follows (as per the translated copy supplied by the party):
The application 6-C is allowed. Accordingly the defendant No. 1 and 2 are directed that during the pendency of suit, to the limit of maximum collected amount by the defendants, the contract of toll tax collection by the system of computerized W.I.M. be issued accordingly the rules and the defendant No. 1 transfers the toll tax collection work during the pendency of case to the plaintiff.
Reply of suit be filed within the legal time bound. For framing the issues let it be put up on fixed date.
8. From the order impugned it is apparent that not only the suit was almost decreed but an order of execution was almost passed, which under no stretch of imagination can be said to be sustainable. Apart from any other ground, it is to be remembered that collection of toll tax is normally fixed on year to year basis and by chance the hearing of the suit is delayed beyond such period and the injunction order is sustained then the purpose of respondent/plaintiff will be subserved irrespective of determination of question of maintainability of the
9. Therefore, the prime question before us is whether the question of maintainability of the suit will come first or the order of injunction. Suit is maintainable if any right exists. Therefore, the Court has to ascertain the prima facie case on the basis of the suit. Out of all relevant guidelines, one of the major guideline is that the plaintiff should have a strong case for trial. That is, it shall be of a higher standard than a prima facie case which is normally required for a prohibitory injunction apart from the question of irreparable loss and balance of convenience. However, grant or refusal of an interlocutory mandatory injunction shall ultimately rest in the judicial discretion of the Court to be exercised in the light of the facts and circumstances in each case as per the ratio of (Hindustan Petroleum Corporation Ltd. v. Sriman Narayan and Anr.). If the suit is not maintainable prima facie, interlocutory application in the nature of ultimate relief in the suit can not be held to be sustainable at all. In further, balance of convenience can not be said to be one way traffic. Moreover, this is not the case where even for the sake of argument suit succeeds but can not be compensated with money. The entire basis of passing the order impugned is preposterous.
10. From the Halsbury's Laws of England, Fourth Edition Reissue, Volume 24, we can get several guidelines which can be applied and applied hereunder for the purpose of effective disposal of the appeal arising out of order of interlocutory mandatory injunction.
11. An injunction is a judicial remedy by which a person is ordered to refrain from doing or ordered to do a particular act or thing. In the former case it is called a prohibitory or restrictive injunction, and in the latter a mandatory injunction. Either type of injunction may be interlocutory or perpetual. An injunction is a remedy of an equitable nature, and therefore acts in personam. The words 'just and convenient' in the statutory provision do not mean that the court can grant an injunction simply because it thinks it convenient, but mean that it should grant an injunction for the protection of rights or the prevention of injury according to legal principles. They confer neither arbitrary nor unregulated discretion on the court, and do not authorise it to invent new modes of enforcing judgments in substitution for the ordinary modes. The general rule is that if a plaintiff applies for an injunction in respect of a violation of a common law right, and the existence of that right or the fact of its violation is denied, he must establish his right at law. It has been said that the power of granting mandatory injunctions must be exercised with the greatest possible care, but every injunction, whether restrictive or mandatory, ought to be granted with care and caution. A mandatory injunction can be granted on an interlocutory application as well as at the hearing, but, in the absence of special circumstances, it will not normally be granted. However, if the case is clear and one which the court thinks ought to be decided at once, or if the act done is a simple and summary one which can be easily remedied, or if the defendant attempts to steal a march on the plaintiff, such as where, on receipt of notice that an injunction is about to be applied for, the defendant hurries on the work in respect of which complaint is made so that when he receives notice of an interim injunction it is completed, a mandatory injunction will be granted on an interlocutory application. The court will not grant an injunction requiring a defendant (I) to perform personal services, (2) to do repairs, (3) to do an act which requires the continuous employment of people, or (4) to carry on a business, except in special circumstances. It will not impose an obligation to do something which is impossible, or which cannot be enforced, or which is unlawful. In order to determine where the balance of convenience lies the court must weigh two matters. The first is to protect the plaintiff against injury by violation of his rights for which he could not be adequately compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial. The second matter is the defendant's need 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 uncertainty were resolved in the defendant's favour at the trial.
12. Mr. Ravi Kant, learned Senior Counsel appearing in support of the respondents, relied upon various judgments in support of his case which are not applicable herein. In (Dorab Cawasji Warden v. Coomi Sorab Warden and Ors.) it appears that on account of transfer of immovable properly i.e. dwelling house as per Section 44 of the Transfer of Property Act, 1882 an order of injunction was passed on the pretext that the dwelling house was belonging to an undivided family. Undivided family would certainly mean in the context undivided qua the dwelling house so that the family which owns the house has not divided it by metes and bounds. Therefore, the above decision of the Supreme Court can not be equated with the present one under any stretch of imagination. In (Gujarat Bottling Co. Ltd. and Ors. v. Coca Cola Co. and Ors.) the question arose in connection with the contract. But situation of passing of order of injunction arose out of an existing contract when the Court visualised that refusal of an interim order will ultimately affect industry and the workers will remain idle and become unemployed.
13. In order to grant a relief of injunction fallowings are to be tested:
(i) Whether the plaintiff has a prima facie case;
(ii) Whether the balance of convenience is in favour of the plaintiff; and
(iii) Whether the plaintiff would suffer an irreparable injury if his prayer for interlocutory injunction is disallowed.
14. The decision whether or not to grant an interlocutory injunction has to be taken at a time when the existence of the legal right assailed by the plaintiff and its alleged violation are both contested and uncertain and remain uncertain till they are established at the trial on evidence. The relief by way of interlocutory injunction is granted to mitigate the risk of injustice to the plaintiff during the period before that uncertainty could be resolved. 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 uncertainty were resolved in his favour at the trial. The need for such protection has, however, to 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 right, for which he could not be adequately compensated. The Court must weigh one need against another and determine where the balance of convenience lies. In order to protect the defendant while granting an interlocutory injunction in his favour the Court can require the plaintiff to furnish an undertaking so that the defendant can be adequately compensated if the uncertainty were resolved in his favour at the trial.
15. The ratio of (Deoraj v. State of Maharashtra and Ors.) has no manner of application in the present suit and interlocutory application in connection thereto. The judgment was delivered at a stage of fait accompli in connection with an election when the provision of quorum lost its significance. 2005 (11) SCC 567 (Prem Singh Chaudhary and Ors. v. State of Uttaranchal and Ors.) arose out of demolition of the construction of hotel on the nallah when it arose that by virtue of construction of such hotel the adjoining colony will be flooded. Therefore, such judgment has no bearing or relevance with the matter pending before this Court.
16. From [Transmission Corporation of A.P. Ltd. v. Lanco Kondapalli Power (P) Ltd.] we find that interim direction ordinarily would precede finding of a prima facie case. When existence of a prima facie case is established, the Court shall consider the other relevant factors, namely, balance of convenience and irreparable injuries. [Ramdev Food Products (P) Ltd. v. Arvindbhai Rambhai Patel and Ors. ] is arising out of the matter of intellectual property. However, in connection with applicability of injunction by the appellate court, the Supreme Court held that normally the appellate court would be slow to interfere with the discretionary jurisdiction of the trial court. The grant of an interlocutory injunction is in exercise of discretionary power and hence, the appellate courts will usually not interfere with it. However, the appellate courts will substitute their discretion if they find that discretion has been exercised arbitrarily, capriciously, perversely, or where the Court has ignored the settled principles of law regulating the grant or refusal of interlocutory injunctions. In coming to decision the Supreme Court followed the judgments reported in 1990 Supp SCC 727 [Wander Ltd. v. Antox India (P) Ltd.], (Laxmikant V. Patel v. Chetanbhai Shah) and (Seema Arshad Zaheer v. Municipal Corporation of Greater Mumbai).
17. In [Colgate Palmolive (India) Ltd. v. Hindustan Level Ltd. ] we find certain rule for grant or refusal for order of injunction as follows:
(i) extent of damages being an adequate remedy;
(ii) protect the plaintiff's interest for violation of his rights though, however, having regard to the injury that may be suffered by the defendants by reason therefor;
(iii) the court while dealing with the matter ought not to ignore the factum of strength of one party's case being stronger than the other's;
(iv) no fixed rules or notions ought to be had in the matter of grant of injunction but on the facts and circumstances of each case--the relief being kept flexible;
(v) the issue is to be looked at from the point of view as to whether on refusal of the injunction the plaintiff would suffer irreparable loss and injury keeping in view the strength of the parties' case;
(vi) balance of convenience or inconvenience ought to be considered as an important requirement even if there is a serious question or prima facie case in support of the grant;
(vii) whether the grant or refusal of injunction will adversely affect the interest of the general public which can or cannot be compensated otherwise.
18. We get from (M. Gurudas v. Rasaranjan) that while considering an application for injunction, the Court would pass an order thereupon having regard to (i) prima facie case, (ii) balance of convenience, and (iii) irreparable injury. A finding on prima facie case would be a finding of fact. However, while arriving at such a finding of fact, the Court not only must arrive at a conclusion that a case for trial has been made out but also other factors requisite for grant of injunction exist.
19. In Seema Arshad Zaheer (supra) it was held that for grant of a temporary injunction the plaintiff is to establish (i) existence of a prima facie case as pleaded, necessitating protection of the plaintiff's right by issue of a temporary injunction; (ii) when the need for protection of the plaintiff's right is compared with or weighed against the need for protection of the defendant's rights or likely infringement of the defendant's rights, the balance of convenience tilting in favour of the plaintiff; and (iii) clear possibility of irreparable injury being caused to the plaintiff if the temporary injunction is not granted. In addition, temporary injunction being an equitable relief, the discretion to grant such relief will be exercised only when the plaintiff's conduct is free from blame and he approaches the Court with clean hands.
20. Above all in this case we do not find any unfair means, unreasonable, discriminatory act on the part of the appropriate respondent.
21. In view of the aforesaid observations, the order impugned in this appeal being dated 29th March, 2007 passed by the Court below can not be sustained and is set aside. Thus, the appeal is allowed on contest at the stage of admission heard on the informal papers as agreed by the parties. Let the suit be expedited upon framing the issues inclusive of the issue of maintainability of the suit, which will be determined at first before any other issues.
22. However, no order is passed as to costs.