2012 (5) TMI 868 - SC - Indian Laws

Summary

Issues Involved:
1. Prima Facie Case for Temporary Injunction
2. Balance of Convenience
3. Irreparable Injury
4. Specific Performance of Contract

Summary:

1. Prima Facie Case for Temporary Injunction:
The Supreme Court examined whether the Respondent No. 1 (Aditya Birla Nuvo Ltd.) had a prima facie case. The Court noted that Liberty Agencies had given a warranty u/s B-2 of the agreement to retain possession of the suit schedule property until the expiry of the agreement. The agreement duration was twelve years from the date of the agreement, expiring in 2017, and only Respondent No. 1 had the right to terminate it after six years. The breach by Liberty Agencies was evident when they sent a letter on 26.02.2010, indicating a breach of clause B-2. Thus, the trial court and the High Court were correct in concluding that Respondent No. 1 had a prima facie case.

2. Balance of Convenience:
The Court considered whether the balance of convenience was in favor of the Plaintiff (Respondent No. 1). The trial court and the High Court had found that if the temporary injunction was not granted, Liberty Agencies might lease or sub-lease the property, leading to multiplicity of proceedings and hardship for Respondent No. 1. However, the Supreme Court noted that Respondent No. 1, being a limited company, would primarily suffer financial losses, which could be compensated by damages.

3. Irreparable Injury:
The Court emphasized that even if a prima facie case exists, a temporary injunction should be refused if the Plaintiff would not suffer irreparable injury. The Respondent No. 1 had claimed damages of Rs. 20,12,44,398/- in the plaint, indicating that the injury could be compensated monetarily. The Supreme Court held that the Respondent No. 1 would not suffer irreparable injury as they could be compensated by damages if they succeeded in the suit.

4. Specific Performance of Contract:
The Appellants argued that the agreement was an agency contract and could not be specifically enforced u/s 14(1)(b), (c), and (d) of the Specific Relief Act, 1963. The Respondent No. 1 countered that specific performance could be decreed in exceptional cases and cited Section 42 of the Specific Relief Act, 1963, which allows for the enforcement of negative agreements. However, the Supreme Court did not delve into these contentions, stating that temporary injunctions are regulated by the Code of Civil Procedure, not the Specific Relief Act, 1963.

Conclusion:
The Supreme Court set aside the order of temporary injunction passed by the trial court and the High Court, stating that the Respondent No. 1 would not suffer irreparable injury as they could be compensated by damages. The appeals were allowed with no order as to costs.