2014 (9) TMI 1246 - HC - Indian Laws

Refusal of an exparte ad interim injunction - bonafide members of the petitioner society who had been unfairly expelled from the society - HELD THAT - The order impugned suffers from the malaise that merely because the appeal may become infructuous upon an ad interim injunction being declined, the Court perceives to be obliged to pass an order. Since the assumption of jurisdiction by the Appellate Court without considering the grounds on which the Trial Court declined the ad interim injunction appears to be irregular and improper, the order impugned dated September 16, 2014 is set aside and the appeal disposed of. The parties should immediately inform the Appellate Court so that it can record the disposal of appeal. The Trial Court is now requested to ensure that the plaintiffs' injunction application is taken up and disposed of within a period of one month after the reopening of the Court following the Puja Vacation - application disposed off.

Summary

Issues: Ex parte ad interim injunction, Urgency in filing suit, Balance of convenience, Doctrine of indoor management, Jurisdiction of Appellate Court, Disposal of appeal, Timely consideration of injunction application.

Analysis:
The judgment pertains to a case where the plaintiffs, claiming to be bonafide members of the petitioner society, had been unfairly expelled and requisitioned an extraordinary general meeting. The Trial Court initially declined the ex parte ad interim order citing lack of urgency in filing the suit promptly after the cause of action arose. The Court emphasized the commendable test of urgency needed to be met by the plaintiffs. However, the Appellate Court, without considering the Trial Court's reasons for refusal, restrained the petitioner society from passing resolutions at the annual general meeting, overlooking the balance of convenience and the nature of business conducted at such meetings.

Moreover, the Appellate Court failed to consider the doctrine of indoor management, which restricts court interference in internal matters of corporate bodies unless fraud or injustice is evident. The judgment highlighted that an ex parte order is an exception and should not be granted automatically upon filing a suit or appeal. The Court emphasized the importance of assessing the merits and balance of convenience before granting interim relief, cautioning against the assumption that an order must be passed merely due to the pendency of a legal action.

Consequently, the judgment set aside the Appellate Court's order as irregular, directing the Trial Court to expedite the plaintiffs' injunction application within a month. The parties were instructed to inform the Appellate Court for record-keeping, and a timeline was set for filing objections and rejoinders. Additionally, the judgment addressed the plaintiffs' complaint regarding non-service of pleadings, requiring the plaintiffs' counsel to provide copies to the defendants' advocate promptly.

In conclusion, the judgment emphasized the importance of due process, balance of convenience, and adherence to legal principles while considering ex parte injunctions and appellate jurisdiction, ensuring fairness and proper adjudication in the legal proceedings.