Calcutta High Court (Appellete Side)
Partha Chakraborty & Others vs Anindya Mitra & Others on 31 July, 2026
2026:CHC-AS:1159
IN THE HIGH COURT AT CALCUTTA
CIVIL REVISIONAL JURISDICTION
APPELLATE SIDE
BEFORE:
THE HON'BLE JUSTICE OM NARAYAN RAI
C.O. 4439 OF 2025
WITH
I.A. NO.: CAN 1 OF 2026
I.A. NO.: CAN 2 OF 2026
WITH
C.O. 224 OF 2026
WITH
C.O. 431 OF 2026
WITH
C.O. 1052 OF 2026
WITH
C.O. 1513 OF 2026
PARTHA CHAKRABORTY & OTHERS
-VS-
ANINDYA MITRA & OTHERS
For the Petitioners : Mr. S. N. Mookerjee, Sr. Adv.
Mr. Jishnu Chowdhury, Sr. Adv.
Ms. Nandini Khaitan, Adv.
Mr. Pratik Shanu, Adv.
Mr. Subhrojyoti Mookerjee, Adv.
Mr. Vidush Sinha, Adv.
Mr. Mehul Bachhawat, Adv.
Mr. Andolan Sarkar, Adv.
For the Opposite Parties : Mr. Sabyasachi Chowdhury, Sr. Adv.
Mr. Rajarshi Dutta, Adv.
Mr. Niladri Saha, Adv.
Mr. Sarbesh Chowdhury, Adv.
Heard on : 21.05.2026
Judgment on : 31.07.2026
OM NARAYAN RAI, J.: -
1. Since all the revisional applications under Article 227 of the Constitution of India are
directed against interlocutory orders passed by the learned District Judge at Alipore,
South 24 Parganas in the same proceeding i.e. Misc. Appeal No. 380 of 2025, which
has been preferred by the opposite party no.1 (hereafter "the opposite party") against
an order dated November 14, 2025 passed by the learned Civil Judge (Senior Division),
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5th Court at Alipore in Title Suit No. 1715 of 2025, therefore, all of them are being
taken up together and are being dealt with by a common order.
2. C.O. 4439 of 2025 is directed against order dated November 18, 2025 passed by the
learned District Judge at Alipore in Misc. Appeal No. 380 of 2025 whereby the
petitioners have been restrained from taking any step to sell any share of the opposite
party to the petitioner no.2 company without the leave of the learned Court.
3. C.O. 224 of 2026 assails an order dated December 18, 2025 whereby the earlier order
dated November 18, 2025 was extended without deciding the objection as regards
territorial jurisdiction of the Court taken by the petitioner.
4. C.O. 431 of 2026, C.O. 1052 of 2026 and C.O. 1513 of 2026 are all directed against
orders extending the initial interim order dated November 18, 2025 passed by the
learned District Judge at Alipore in the said appeal.
FACTS OF THE CASE:
5. The relevant facts of the case may be briefly recounted:-
i. The opposite party has instituted Title Suit No. 1715 of 2025 against the
petitioners/defendants before the learned Civil Judge (Senior Division), 5th Court at
Alipore, South 24 Parganas praying inter alia for decrees for declaration and
permanent as well as mandatory injunction.
ii. Shorn of vast details, the case run in the plaint is as follows:-
a. Both the petitioner no.1 and the opposite party were initially employed in IBM,
India. At IBM, India, the petitioner no.1 was the manager of the opposite party. It is
the opposite party-plaintiff’s case that he “sacrificed a secure job in respect of an
Indian Company with multinational presence, being heavily influenced by the
defendant no.1” (i.e., the petitioner no.1 herein).
b. The petitioner no.1 formed and incorporated the petitioner no.2 company in
England and Wales. Thereafter, the petitioner no.1 set up/established the petitioner
no.3 company in India as a wholly owned subsidiary of the petitioner no.2 company
aiming to bring in senior qualified IT personnel as shareholders of the petitioner
no.2 company while employing them in petitioner no.3 company.
c. When the opposite party moved to the United Kingdom (hereafter “UK”) and joined
his services at IBM, UK, the petitioner no.1 contacted the opposite party and
thereafter, in April 2025 (sic 2024), the proforma opposite party no.3 (i.e. the wife of
the opposite party) became a shareholder of the petitioner no.2 company upon
entering into a Share Holders’ Agreement (hereafter “the SHA”) inter alia with the
petitioner nos.1 and 2.
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d. Thereafter, the opposite party became an employee of the petitioner no.3 company
with effect from August 01, 2024. The petitioner no.1 convinced the opposite party
to take 50% reduction of his previously drawn salary at IBM.
e. As the proforma opposite party no.3 could not continue to do business with the
petitioner nos.1 and 3, therefore, it was agreed that the shares of the opposite party
no.3 would be transferred in favour of the opposite party and the opposite party
would become a shareholder of the petitioner no.2 company. Accordingly, a Deed of
Adherence (hereafter “DOA”) was entered into between the petitioner no.2 company
and the opposite party whereby the petitioner no.1 agreed to be bound by the SHA.
Although, the said DOA is dated August 09, 2024, the same was signed on
September 15, 2024. The opposite party thus became a shareholder of the
petitioner no.2 with 10% holding in the petitioner no.2 company.
f. After a brief stint of employment in the petitioner no.3 company, disputes and
differences arose between the petitioner no.1 and the opposite party. The opposite
party therefore tendered his resignation on June 01, 2025 and ultimately left the
employment of the petitioner no.3 company on August 31, 2025 upon expiry of the
three months’ notice period.
g. After remaining jobless for two months the opposite party took up another job with
effect from November 03, 2025.
h. The petitioners thereafter sought to buy-back the shares of the petitioner no.3
company that the opposite party owns. The opposite party claims that the
petitioners are not entitled thereto and as such the opposite party has instituted
the suit praying for the reliefs claimed in the plaint.
iii. In the said suit the opposite party made an application under Order XXXIX Rules 1
and 2 of the Code of Civil Procedure, 1908 (hereafter “the Code”) praying for
temporary and ad interim injunction.
iv. The said application was pressed by the opposite party for ex-parte ad-interim order
before the learned Trial Court on November 14, 2025. Upon hearing the opposite
party and upon perusing the material on record, the learned Trial Court observed
that the opposite party had been able to make out a prima facie case as regards
prayer (a) of the said application and accordingly restrained the defendants in the
suit from “disturbing the peaceful employment” of the opposite party till December
09, 2025. The learned Trial Court further observed that the other prayers made in
the said application would be “decided” upon hearing the defendants.
v. Feeling aggrieved thereby, the opposite party carried the matter in appeal being
Misc. Appeal No. 380 of 2025 before the learned District Judge at Alipore. In thePage 3 of 34
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said Misc. Appeal, the opposite party filed another application under Order XXXIX
Rules 1 & 2 of the Code praying for ad interim reliefs.
vi. The said application was moved ex-parte on November 18, 2025. Upon hearing the
opposite party, the learned Appellate Court passed an ex-parte ad interim order of
injunction in terms of prayer (a) of the said application thereby retraining the
petitioners from “taking any step to sell any shares having number 1,00,000 of the
plaintiff/appellant in favour of the respondent/defendant no.2” without the leave of
the Court till December 18, 2025.
6. Feeling aggrieved thereby the petitioner has approached this Court by filing C.O. 4439
of 2025. The other revisional applications have been filed assailing the orders
extending the said interim order that was passed initially on November 18, 2025 as
already indicated hereinabove.
ARGUMENTS ON BEHALF OF THE PETITIONERS:
7. A brief summary of the submissions made by Mr. Mookerjee, learned Senior Advocate
appearing for the petitioners (both orally as well as in the written notes) is as follows:-
a. The impugned order is not sustainable as the appeal being Misc. Appeal No. 380 of
2025 was incompetent and not maintainable in law. The order dated November 14,
2025 passed by the learned Trial Court is not an appealable order under Order
XLIII of the Code since the learned Trial Court had not taken any decision or denied
any relief to the opposite party but had merely deferred or postponed the
determination of certain prayers by two weeks. This does not amount to an
adjudication affecting rights or liabilities and therefore no statutory appeal could
have been filed under Order XLIII of the Code. In support of his submissions, he
relied on a judgment of the Hon’ble Supreme Court in the case of Shyam Sel And
Power Limited & Another vs. Shyam Steel Industries Limited1.
b. The prayer granted by the learned Appellate Court in relation to the buyback of
shares was not made in the interim injunction application before the learned Trial
Court.
c. In his first interim application, the opposite party had prayed for a “temporary
mandatory injunction” seeking a direction to sell the subject shares “at a reserved
price as pleaded hereinabove or as may be later determined by this Learned Court”.
Therefore, the learned Appellate Court erred in failing to determine whether it had
jurisdiction before passing the ex-parte interim order.
1 (2023) 1 SCC 634
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d. There is nothing on record to show how the learned Appellate Court assumed
jurisdiction. Jurisdiction has to be determined at the threshold before passing any
order, including interim orders and at least a prima facie satisfaction has to be
arrived at. A judgment of the Hon’ble Supreme Court in the case of Asma Lateef &
Another vs. Shabbir Ahmad & Others2 was relied on in support of such
contention.
e. No reason or authority has been shown to demonstrate that there could be
departure from this settled principle of law. Furthermore, no extraordinary or high-
hardship scenario has been shown to exist that was considered in the impugned
order or in the pleadings in the learned Courts below.
f. The impugned order that has been passed is wholly without jurisdiction as all
prayers in relation to the subject shares concern a company incorporated in UK and
governed by instruments expressly subject to English laws and the exclusive
jurisdiction of the Courts of England and Wales. The petitioner no.2 is a foreign
company incorporated under the laws of England. Its Articles of Association
(hereafter “AoA”) were adopted pursuant to Chapter 2 of Part 13 of the UK
Companies Act, 2006. The proceedings before the learned Trial Court and the
learned Appellate Court are therefore ex facie not maintainable.
g. The interim prayers made by the opposite party in the appeal relating to the
buyback of shares are governed by the AoA of the opposite party no.3. The AoA
specifically contemplates two classes of “Leavers”, namely a “Good Leaver” and a
“Bad Leaver”. Since the opposite party ceased to be a relevant employee, he was
rendered a “Bad Leaver”, thereby triggering Clause 16 of the AoA, which entitles the
opposite party no.3 to compulsorily buyback the shares and execute all necessary
instruments to give effect thereto.
h. Since the situs of the shares of petitioner No.2 Company is in UK therefore, the
learned Appellate Court does not have jurisdiction to pass orders in respect of
property located outside its jurisdiction. The judgment in the case of Vodafone
International Holdings BV vs. Union of India & Another3 was relied on for such
purpose.
i. The opposite party voluntarily became a shareholder of the petitioner no.2 – a UK
Company. He has signed the DOA and is bound by the SHA and all the obligations
contained therein. The SHA unequivocally provides that the agreement shall be
governed by English laws and that all disputes arising therefrom shall be subject to
2 (2024) 4 SCC 696
3 (2012) 6 SCC 613
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the exclusive jurisdiction of the Courts of England and Wales. Parties are entitled to
confer exclusive jurisdiction upon foreign Courts, and such forum selection clauses
must ordinarily be enforced by Indian Courts. Modi Entertainment Network &
Another vs. W.S.G Cricket Pte. Limited4 was relied on for such purpose. The
written note captioned “Short Points of Arguments on behalf of the petitioners” also
refers to another judgment in the case of British India Steam Navigation Co.
Limited vs. Shanmughavilas Cashew Industries & Others5 to buttress the same
point.
j. In view of the forum selection clause, the learned Trial Court and the learned
District Judge had no jurisdiction to the pass the impugned order. The Courts of
England and Wales are Courts of competent jurisdiction and can decide the
compliance of the transaction with Indian laws.
k. In view of the exclusive jurisdiction clause, the UK High Court (Commercial
Division) passed an order of temporary injunction on December 12, 2025
restraining the opposite party from pursuing the Indian proceedings. This
injunction was made permanent vide order dated January 16, 2026. Due to the
opposite party’s breaches of these orders, the UK High Court found the plaintiff to
be in contempt and sentenced him to 12 months imprisonment vide order dated
April 17, 2026
l. The impugned order is unreasoned. It does not disclose any independent reasoning
for reaching its conclusion on the prima facie case sought to be established by the
opposite party.
m. Paragraphs 1 and 4 of the impugned order demonstrate that the learned Appellate
Court merely reproduced and adopted the submissions advanced by the opposite
parties without recording “what” its findings are and “why” they have reached such
findings.
n. The impugned order and its subsequent extensions (as challenged in the batch of
COs), fail to meet the ‘what’ and ‘why’ test as it does not disclose any findings,
justifications or reasons for holding that there is a prima facie case. Asma Lateef &
Another (supra), Sailesh Bhansali vs. Alok Dhir & Others6 and Uniworth
Resorts Limited & Another vs. Ashok Mittal & Others7 were cited to support
the assertion.
4 (2003) 4 SCC 341
5 (1990) 3 SCC 481
6 2025 SCC OnLine SC 512
7 2007 SCC OnLine Cal 535
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o. Without prejudice to the objection as to of jurisdiction, the opposite party has failed
to establish any prima facie case. In the title suit, the opposite party has contended
that the buyback of the subject shares at the issue price violates the provisions of
the Income Tax Act, 19618 (particularly Sections 50CA, 56(2)(x), 92 and 92F thereof)
and FEMA, thus being void pursuant to Section 24 of the Indian Contract Act, 1872
(hereafter “the 1872 Act”).
p. FEMA Act as well as the Foreign Exchange Management (Overseas Investment)
Rules, 2022 and Regulations of 2022 do not contemplate any prohibition or bar or
any such transaction. In any event, any alleged violation of FEMA does not make
the transaction void. Any alleged violation is curable and rectifiable and does not
mean that the transaction is in violation of law or fundamental policy of Indian law,
therefore, it cannot be said that the transaction or its object or the consideration is
unlawful. Vijay Karia & Others vs. Prysmian Cavi E Sistemi SRL & Others9
was cited in support of such argument.
q. Section 50CA or Section 56(2)(x) of the 1961 Act does not contemplate any bar or
prohibition against the sale of shares at the issue price. Instead the statutory
scheme expressly recognizes that such situations may arise where consideration
received may not be the same as the value of the shares and lays down how such
proceeds are to be taxed. Similarly, Sections 92 and 92F of the 1961 Act are not
attracted in the instant case since the transaction involved in the suit does not
pertain to “associated companies” or transfer pricing.
r. Any tax payable and compliance required are squarely the plaintiff/opposite party’s
personal obligation and do not create any liability on the company. The opposite
party was always aware of the implications of being rendered a ‘Bad Leaver’. The
same would be evident from the emails dated October 22, 2025 and email dated
October 28, 2025. From such correspondence, it is also clear that the plaintiff was
always aware that he had a tax liability and that the AD Bank “regulatory block”
resulted in only “hold” on the buyback till regularisation process was completed
with Reserve Bank of India (hereafter “RBI”). Therefore, the case made on illegality
or violation of FEMA cannot be sustained.
s. All allegations of FEMA violation by the Plaintiff/opposite party based on the email
from HDFC Bank are misplaced. The violation alleged in that email relates to a
failure to disclose the transfer of shares from opposite party no.4 to the
Plaintiff/opposite party as required under the FEMA Act and Rules framed
8 Hereafter “the 1961 Act”
9 (2020) 11 SCC 1
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thereunder. In any event, they could be regularized with RBI through the payment
of LSF (Late Submission Fee).
t. In any event, all rights and contentions of the opposite party that the manner of the
working of the transaction is contrary to the abovementioned provisions can always
be urged before the Courts of England and Wales.
u. It was urged that the initial order granting injunction and all the subsequent orders
of extension, ought to be set aside.
ARGUMENTS ON BEHALF OF THE OPPOSITE PARTIES:
8. A brief summary of the submissions made by Mr. Chowdhury, learned Senior
Advocate appearing for the opposite parties (both orally as well as in the written notes)
is as follows:-
a. Clause 22.2 of the SHA has three limbs which define the subject matter that can be
carried to the agreed English Court. The first limb of this clause relates to disputes
or claims (including any non-contractual disputes or claims) which may arise out of
or in connection with the SHA. The second limb relates to disputes or claims in
connection with the subject matter or formation of the SHA. The third limb relates
to disputes or claims as to the rights and liabilities of the shareholders in
connection with the business and their holding of shares. The present dispute does
not fall under any of the three limbs of Clause 22 of the SHA.
b. While the Petitioners rely upon the principles of international comity and choice of
forum laid down in Modi Entertainment Network & Another (supra), that
landmark ruling itself explicitly recognizes that a domestic Court will refuse to
enforce a foreign exclusive jurisdiction clause if the agreed foreign forum is shown
to be oppressive or vexatious. Forcing an Indian resident individual, under the
threat of offshore penal committal, to execute a transaction on Indian soil that
directly commands a blatant breach of mandatory domestic exchange controls and
fiscal policies constitutes the oppression, which completely strips Clause 22.2 of its
binding effect.
c. If the reliefs that the opposite party claims in the suit can never be granted by the
English Court, upon consideration of the Indian law (FEMA, the 1872 Act and the
1961 Act), it is but obvious that there is no ouster of jurisdiction under Clause 22
of the SHA for the learned Court to receive, try and entertain the suit.
d. Furthermore, the English Courts do not have jurisdiction. Relying on Taprogge
Gesellschaft MBH vs. IAEC India Limited10, it was submitted that a contract,
10 1987 SCC OnLine Bom 345
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valid by the proper law cannot be enforced in the country where it has to be
performed if its performance is opposed to the fundamental principles of public
policy or a statute of that country.
e. In terms of Article 16 of the AoA, the opposite party is required to deliver the
relevant share certificates against payment of the sale price for such shares to
complete the transaction of sale envisaged therein. In the event the orders under
challenge are set aside and/or vacated and the injunction is lifted, the petitioners
would be entitled to buyback the opposite party’s shares and deposit the fund in a
trust which then would require the opposite party to repatriate such funds to its
Indian account within 90 days, as per Regulation 9(4) of the FEMA Overseas
Investment Regulations, 2022. Therefore, performance of the obligations would end
at India only when the fund is repatriated. Relying on paragraph 23 of the report, it
was contended that if the contract has to be performed in India, Indian statute will
govern the legality of the performance. Indian Courts will not enforce the contract if
its performance involves the violation of an Act of the legislature.
f. Referring to Regazzoni vs. K. C. Sethia (1944) Limited11 which has been relied on
by the Hon’ble Bombay High Court in Taprogge Gesellschaft MBH (supra) it was
sought asserted that in that case too, the English Court took judicial notice of the
Indian law and refused to enforce the agreement between the contracting parties.
g. The performance of the AoA and the SHA would contravene the various laws under
the FEMA regime namely:-
(i) Article 16.1.3(c) of the AoA directly contravenes 16(1) of the FEMA Overseas
Investment Rules 2022 (which provides for pricing guidelines and requires price
to be arrived at on arm’s length basis) inasmuch as the sale price of the shares
for a Bad Leaver would be the lower of the Fair Price and the Issue Price and in
this case the Fair Price, being the price of the shares at market value, is
currently worth much more than the Issue Price of around Rs. 1 Crore. In fact,
Rule 16(2) provides that the AD bank, before facilitating a transaction under sub-
rule (1), shall ensure compliance with arm’s length pricing taking into
consideration the valuation as per any internationally accepted pricing
methodology for valuation.
(ii) Any arrangement of specifically or compulsorily performing a buy-back in the
United Kingdom and holding the proceeds of such alleged compulsory buy-back
in a trust for the benefit of the plaintiff would completely frustrate the directions
under Regulation 9(4) of the FEMA Overseas Investment Regulations 2022 which
11 [1956] 2 Q.B. 490
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provides that a person resident in India having overseas direct investment
(hereafter “ODI”) in a foreign entity, wherever applicable, shall realise and
repatriate to India, all dues receivable from the foreign entity with respect to
investment in such foreign entity, the amount of consideration received on
account of transfer or disinvestment of such ODI and the net realisable value of
the assets on account of the liquidation of the foreign entity as per the laws of
the host country or the host jurisdiction, as the case may be, within ninety days
from the date when such receivables fall due or the date of such transfer or
disinvestment or the date of the actual distribution of assets made by the official
liquidator.
(iii) Thus, the funds receivable by the person resident in India must be repatriated
into India within 90 days from the date when such receivables fall due i.e., from
the date when the buy-back is effected and if that is done the opposite party
would suffer.
h. While the principles of law relied upon by the petitioners in their submissions
cannot be challenged, the same do not have any application to the facts of the
present case.
i. The learned Appellate Court has jurisdiction to decide upon the issues raised in the
suit. Once the learned Appellate Court is established to have jurisdiction, any
further question involving interim reliefs would be rendered nugatory.
j. The petitioners have relied upon the judgment in the matter of Shyam Sel And
Power Limited & Another (supra) in support of the contention that an Appellate
Court has no power to interfere with the exercise of discretion of the Court of first
instance and substitute its own discretion, except where the discretion has been
shown to have been exercised arbitrarily, or capriciously or perversely or where the
Court had ignored the settled principles of law regulating grant or refusal of
interlocutory injunctions. According to the petitioners, the learned First Appellate
Court did not decide the jurisdictional objection while extending the ex-parte ad-
interim order dated November 18, 2025, on December 18, 2025.
k. As would appear from paragraph 31 of the report, the Hon’ble Supreme Court took
note of the fact that the hierarchy of the learned Trial Court and the learned
Appellate Court existed so that the learned Trial Court exercises its discretion upon
the settled principles of law. The present civil revisional applications have remained
pending since 2025. If an issue of jurisdiction is to be decided by the learned First
Appellate Court, a direction could be issued on the learned First Appellate Court to
decide such issue considering the hierarchy of the Courts. The Supreme Court also
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takes note of such fact that if the learned Appellate Court itself decides the matters
required to be decided by the learned Trial Court, there would be no necessity to
have the hierarchy of Courts.
l. Paragraph 41 of Asma Lateef & Another (supra) explicitly carves out an exception
for extraordinary, high-hardship scenarios, preserving a Court’s inherent power to
protect the subject matter of a suit where a refusal of ad-interim relief would
instantly result in an irreversible, structural violation of sovereign domestic laws.
m. If the learned Trial Court has the jurisdiction to receive, try and entertain the suit,
the learned Appellate Court also has the jurisdiction to pass and extend the ad-
interim orders on November 18, 2025 and December 18, 2025, respectively.
n. Without prejudice, it is submitted that this Hon’ble Court has the power to
supplant reasons in support of the jurisdiction argument advanced by the opposite
party, considering the balance of convenience and inconvenience and the
irreparable injury that may be suffered by the opposite party if the orders under
challenge are set aside or vacated.
o. In the facts of the present case, if the revisional Court itself decides the point of
jurisdiction, it would have the effect of nipping the plaint in the bud, ignoring the
essence of the principles relating to hierarchy of Courts.
p. The provisions of Section 15 of FEMA enable compounding of any contravention
under the Act. The RBI is empowered to compound any contravention as defined
under Section 13 of FEMA. Section 13 of FEMA provides for the penalties that are
to be imposed if a person contravenes any provision of the Act.
q. RBI issued the Circular dated October 01, 2024, containing directions for
compounding of contraventions under FEMA for all AD banks to follow, being FEMA
Directions Compounding of Contraventions 2024 (“RBI Circular”) under FEMA,
1999.
r. In terms of Clause 2.2 of the RBI Circular, the contravention of Rule 21 of the
FEMA Overseas Investment Rules, 2022 is compoundable. There is no other Rule in
the FEMA Overseas Investment Rules, 2022 that is envisaged as compoundable in
the RBI Circular 2024. It therefore transpires that contravention of pricing
guidelines under Rule 16 of the FEMA Overseas Investment Rules, 2022 is not
compoundable.
s. Under Clause 3.1 of the RBI Circular 2024, an application for compounding is
envisaged, which can be filed either suo motu or based on a Memorandum of
Contraventions issued by RBI. Such an application cannot be made by the plaintiff
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as violation of Rule 16 of the FEMA Overseas Investment Rules, 2022 is not
envisaged as compoundable contravention.
t. In arguendo, even if the RBI Circular 2024 is applicable and an application for
compounding is maintainable for contravention of Rule 16 of the FEMA Overseas
Investment Rules 2022, Clause 4.2 of the RBI Circular 2024 provides that no
compounding application shall be processed without relevant administrative action.
Amongst others, administrative actions include repatriating the receivable dues and
compliance with pricing guidelines.
u. Such repatriating of receivable dues is to be complied under Regulation 9(4) of
FEMA Overseas Investment Regulations, 2022 and compliance with pricing
guidelines must be followed under Rule 16 of the FEMA Overseas Investment Rules,
2022.
v. The petitioners have relied upon paragraph 88 of the judgment in the matter of
Vijay Karia & Others (supra)12. In this case, the foreign award which was sought
to be enforced directed sale of shares by a resident of India to a non-resident at a
sum which shall not be less than market value of the shares in violation of Rule 21
of the Non-Debt Instrument Rules. The award directed the shares to be a sold at a
sum less than the market value. Relying upon paragraph 88 of the report, petitioner
has argued that the enforcement of a foreign award was not allowed to be resisted
on the ground that the same was in contravention of the “fundamental policy of
Indian law”.
w. The expression used in Section 48 of the Arbitration and Conciliation Act, 1996 is
“fundamental policy of Indian law”, which is different from the expression used in
Section 13(f) of the Code which is “breach of any law in force in India”. The
arbitration-centric narrow standards advanced by the petitioners in Vijay Karia &
Others (supra) is wholly inapplicable to a civil suit testing a Foreign Court’s orders
under Section 13(f) of the Code. The inclusion of the literal word “any” in Section
13(f) creates a zero-tolerance bar against any statutory infraction (it may be
recorded that the written note also mentions that “Renusagar (supra)” alongwith
Vijay Karia & Others (supra) but the Renusagar case was not cited by the
petitioners).
x. The opposite party here relies upon Section 13(f) of the Code whereby a foreign
judgement shall not be conclusive as to any matter thereby directly adjudicated
upon between the same parties or between parties under whom they or any of them
12 Wrongly written as “NAFED vs. Alimenta SA” in the written notes of argument on behalf of the opposite
parties
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claim litigating under the same title except where it sustains a claim founded on a
breach of any law in force in India. It is submitted that a decree of the English
Court shall be rendered inconclusive and inexecutable in India as the same would
violate provisions of FEMA, being breach of law in force in India.
y. In Griesheim GMBH (Now Called Air Liquide Deutschland GMBH) vs. Goyal MG
Gases Private Limited13, the order of the Delhi High Court refusing to enforce a
foreign judgement passed by the English Court was under challenge. One of the two
questions that arose related to the bar of enforcement in view of the conditional
prior permission given by RBI under the repealed FERA 1973. Section 47 of FERA
and the effect of Section 47(3)(b) engrafted an express limitation in mandatory
terms stipulating that “no steps shall be taken for the purpose of enforcing any
judgement/order …….. except….. as the RBI…. may permit”. This mandatory
provision was not complied. The Supreme Court held that the foreign judgement
suffered from fundamental infirmities of the Code, which included Section 13(f) and
the enforcement of liability contrary to binding statutory conditions brings the
decree within the prohibition contained in Section13(f), being opposed to the law in
force in India. The foreign judgement therefore failed the substantive tests
mandated in Section 13(f) of the Code.
z. Although this appears to be a defence raised to resist enforcement of a foreign
judgement, the suit instituted by the opposite party is to seek declaratory reliefs on
the self-same principles so as to avoid a foreign judgement which could be resisted
in future. What can be used as a defence at a later stage in litigious proceedings
should not preclude the plaintiff from using the same as a cause of action to seek
reliefs, which the English Court, in any event, would not be competent to grant in
the first place.
aa. The opposite party has sought for a declaration that the SHA is void and nullity. If
the SHA cannot be enforced, the shares held by the opposite party in petitioner no.2
company cannot be sold/bought back. The interim prayer in the learned First
Appellate Court, seeking for a temporary injunction against the defendants from
selling the opposite party’s shares in petitioner no.2 company, is in aid of the final
reliefs in the suit and therefore maintainable.
bb. Prayer (e) of the injunction application filed before the learned Trial Court, is for a
temporary/mandatory injunction directing the petitioners to sell the shares at a
reserve price or at such other price determined by the learned Court. Prayer (a) of
the injunction application filed in the learned First Appellate Court is for a
13 2026 SCC OnLine SC 648
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temporary injunction to restrain the petitioners from selling the opposite party’s
shares. Both the prayers are to protect the opposite party’s interest in the subject
shares and do not run contrary to each other.
cc. These prayers are in support of the main reliefs (b) and (c) of the plaint. As the
prayers sought in the injunction applications before the learned Trial Court and the
learned First Appellate Court are couched within the broader relief sought in the
plaint, the same ought not to be interfered with.
dd. Reasons cannot be said to be absent if it is rendered after considering detailed
submissions of the petitioners. The learned First Appellate Court was not inclined
to interfere with the order dated November 18, 2025 as the petitioner had already
challenged such order in C.O. 4439 of 2025. The issue of jurisdiction, being the
primary challenge in C.O. 4439 of 2025, was sub judice before the Hon’ble Court,
and therefore applying the principles of judicial propriety and comity, the learned
First Appellate Court thought it fit to extend the ad-interim order dated November
18, 2025.
ee. The reason for this is also recorded in the order dated December 18, 2025, which
records that “…this Court should restrain and avoid passing order that could
circumvent, prejudice, or render infructuous the proceeding”.
ff. Since the issue was res sub judice, the learned First Appellate Court passed the
order dated December 18, 2025 and has been continuing to extend the original ex-
parte ad-interim order dated November 18, 2025, from time to time.
gg. The English Court has granted relief in the nature of anti-suit injunction to the
contesting petitioners by passing an order dated December 12, 2025. This order has
been confirmed by another order dated January 16, 2026.
hh. As indicated above, if this Court decides the issue of the opposite party jurisdiction
in favour of the petitioner, the corollary to this would be that the orders of the
English Court granting anti-suit injunction will not prevent the opposite party from
pursuing or continuing the suit. A Court of natural jurisdiction can grant an anti-
suit injunction under certain exceptional circumstances.
ii. Any order of interference would amount to lifting and/or vacating the interim
protection in respect of 100000 shares that is being enjoyed by the opposite party.
This would have the immediate result of permitting a forced, illegal buyback of the
shares held by the opposite party, thereby rendering the suit itself infructuous.
jj. For the reasons aforesaid, the applications filed by the petitioners challenging the
orders dated November 18, 2025 and December 18, 2025 as well as the extension of
the interim orders thereafter on diverse dates, deserve to be dismissed.
Page 14 of 34
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REJOINDER OF THE PETITIONERS:
9. Mr. Mookerjee, learned senior advocate appearing for the petitioners made the
following submissions in reply:-
a. The opposite parties have sought to misread and misconstrue the decision of the
Hon’ble Supreme Court in the case of Shyam Sel And Power Limited & Another
(supra). The said decision was not relied upon by the petitioners for the
propositions asserted in paragraph 37 of their note.
b. Shyam Sel And Power Limited & Another (supra) was cited for the proposition
that since there was only a postponement of determination by the learned Civil
Judge, there was no “order” that could be appealed from. As such, the appeal before
the learned Judge was not maintainable and was incompetent. The opposite party
has failed to answer this point. In fact, the opposite party has not even attempted to
answer this point.
c. The opposite party has sought to distinguish the decision in Asma Lateef (supra)
in paragraph 38 and 39 of their note but the judgment was not cited for the
proposition mentioned in paragraph 38. The said case was cited for the proposition
that jurisdiction has to be decided first before passing any order, or even interim
orders and at least a prima facie satisfaction has to be arrived at. The opposite party
has no answer to this proposition.
d. The Courts of England and Wales are Courts of competent jurisdiction and can
decide the compliance of the transaction with Indian laws. This will be evident also
from the decision (cited by opposite party) in Griesheim GMBH (supra). In fact,
English Courts have also taken note of Indian laws when deciding the enforcement
of contracts, which will be evident from the decision (relied upon by the opposite
party) in Regazzoni (supra), which has been affirmed in appeal by the House of
Lords.
e. It is submitted that the opposite parties have sought to distinguish the decision in
Modi Entertainment Network & Another (supra) in paragraph 30 in their note.
They have sought to contend that a domestic Court will refuse to enforce a foreign
exclusive jurisdiction clause if the agreed forum is shown to be oppressive and
vexatious. The said contention cannot be accepted since: (i) there is no such finding
in the impugned orders; (ii) such point was not raised as a ground before the
District Judge, (iii) In any event, the transaction was in the course of international
commerce, with both parties fully aware of the clauses therein and the implications
thereof. There is no evidence of any oppression or vexatious proceedings. In any
event, as stated above, the subject matter of the dispute pertains to shares of a
Page 15 of 34
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foreign company, and the Courts in UK are the only competent Court to decide on
any dispute with respect to the same.
f. The opposite parties have relied upon the decision reported in Griesheim GMBH
(supra) to contend that a foreign judgment which does not consider violations under
the FERA Act cannot be enforced in India by virtue of Section 13(f) of the Code.
However, the said contention is wholly misconceived for the many reasons:- (a) The
Hon’ble Supreme Court rejected the submission that there is an absolute bar of
enforcement of decree, if there is a breach of conditions imposed under FERA. It
held that the government authorities can exercise its regulatory power can grant
approval for implementing the judgment. (b) In any event, the cited case concerned
FERA and not FEMA. FERA and FEMA are materially different as noted in the case
of Vijay Karia & Others (supra), which also held that transactions which violate
FEMA cannot be held to be void.
g. The judgments relied upon by the opposite parties themselves holds that UK Courts
will consider foreign law and any violation thereof, including Indian law, while
deciding a lis.
h. The opposite parties have relied on a decision in Taprogge Gesellschaft MBH
(supra) for the proposition that when there is a conflict between foreign law and its
enforcement in a country where it has been performed such contract cannot be
enforced in India since it contravenes the provisions of Indian law even if it is valid
under foreign law.
i. The petitioners herein have not challenged the order of the learned Civil Judge
restraining the petitioners from interfering with the new employment of opposite
party. Therefore, there is no grievance with respect to that part of the order and the
cited case is of no consequence.
ANALYSIS & DECISION:
10. Heard the learned Senior Advocates appearing for the respective parties and
considered the material on record.
11. The first ground on which the appellate orders have been sought to be impeached is
that the appeal itself is not maintainable. Such point has been raised for the first time
before this Court and the opposite party’s appeal is still pending before the learned
Appellate Court. It would not be proper for this Court to decide the said issue finally at
the first instance, however, a prima facie finding on such aspect will be required to be
returned inasmuch as if it is found that the appeal itself is prima facie notPage 16 of 34
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maintainable, the interim orders passed therein would lose life and there would be no
further requirement to examine the orders impugned.
12. The petitioners have cited Shyam Sel And Power Limited & Another (supra) in
support of their contention pertaining to non-maintainability of the appeal. The said
judgment had been rendered in the context of a Letters Patent appeal. Under Clause
15 of the Letters Patent of 186514 a judgment passed by an Hon’ble Single Judge of
this Court can be carried in appeal before the Hon’ble Division Bench of this Court.
13. Shyam Sel And Power Limited & Another (supra) is substantially based on an
earlier judgment of the Hon’ble Supreme Court in the case of Shah Babulal Khimji
vs. Jayaben D. Kania & Another15, where the Hon’ble Supreme Court had to
undertake the exercise of ascertaining the true meaning of the expression “judgment”
in the context of Letters Patent since the said expression has not been defined in the
Letters Patent.
14. The following paragraphs of Shah Babulal Khimji (supra), which have also been
quoted in Shyam Sel And Power Limited & Another (supra) deserve to be noticed
before proceeding further:-
“114. In the course of the trial, the trial Judge may pass a number of orders whereby some
of the various steps to be taken by the parties in prosecution of the suit may be of a routine
nature while other orders may cause some inconvenience to one party or the other, e.g., an
order refusing an adjournment, an order refusing to summon an additional witness or
documents, an order refusing to condone delay in filing documents, after the first date of
hearing an order of costs to one of the parties for its default or an order exercising discretion in
respect of a procedural matter against one party or the other. Such orders are purely
interlocutory and cannot constitute judgments because it will always be open to the aggrieved
party to make a grievance of the order passed against the party concerned in the appeal
against the final judgment passed by the trial Judge.
115. Thus, in other words every interlocutory order cannot be regarded as a judgment but
only those orders would be judgments which decide matters of moment or affect vital and
valuable rights of the parties and which work serious injustice to the party concerned.
Similarly, orders passed by the trial Judge deciding question of admissibility or relevancy of a
document also cannot be treated as judgments because the grievance on this score can be
corrected by the appellate court in appeal against the final judgment.”
15. Thus, while routine orders cannot be said to be judgments withing the meaning of
Clause 15 of Letters Patent, orders which decide matters of moment or affect vital and
valuable rights of the parties and which work serious injustice to the party concerned
would qualify to be called judgments and would therefore be appealable under Clause
15 of the Letters Patent.
16. The following paragraphs of Shyam Sel And Power Limited & Another (supra)
capture the Hon’ble Supreme Court’s reasoning in support of the conclusion that the
14 Hereafter “Letters Patent”
15
(1981) 4 SCC 8
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order of the Hon’ble Single Judge was not a “judgment” within the meaning of Clause
15 of the Letters Patent:-
“23. In the light of this observation, we will have to consider as to whether the order
passed by the learned Single Judge dated 2-4-2019 [Shyam Steel Industries Ltd. v. Shyam Sel
& Power Ltd., 2019 SCC OnLine Cal 9130] , could be construed as a “judgment” within the
meaning of Clause 15 of the Letters Patent.
24. What the learned Single Judge has done by the said order, was to grant two weeks’
time to the appellant-defendants to file affidavit-in-opposition and postpone the issue of grant
of ad interim injunction by three weeks. No doubt, that the learned Single Judge has at one
place observed that prima facie, he was of the view that ” SHYAM” being a part of the business
name of the appellant-defendants, no injunction should be passed to restrain the appellant-
defendants from using the said word “SHYAM” on their packaging, but in the same order, he
has clarified that all the observations he has made in the said order were prima facie for the
purpose of passing an order at the ad interim stage and the same would have no relevance at
the time of considering and deciding the said application after exchange of affidavits.
25. It could thus be seen that the order in fact was postponement of the question as to
whether the respondent-plaintiff was entitled to grant of an ad interim injunction or not, and
that too, by merely three weeks. The order was only giving an opportunity to the appellant-
defendants to file their affidavit-in-opposition within a period of two weeks. The order clarified
that no prayer for extension of time shall be entertained. The learned Single Judge therefore
postponed the issue with regard to consideration of the prayer of the respondent-plaintiff for
grant of ad interim injunction by a period of mere three weeks and that too only in order to
afford an opportunity to the appellant-defendants to file their affidavit-in-opposition. While
doing the same, the respondent-plaintiff’s interest was also protected, inasmuch as the
appellant-defendants were directed to maintain weekly accounts of sale of their products
covered by Class 6, which were sold under the mark “SHYAM”.
26. It is thus clear that there was no adjudication with regard to the rights of the
respondent-plaintiff to get an ad interim injunction during the pendency of the suit. Though by
postponement of the issue with regard to grant of ad interim injunction, the order might have
caused some inconvenience and may be, to some extent, prejudice to the respondent-plaintiff;
the same could not be treated as a “judgment” inasmuch as there was no conclusive finding
as to whether the respondent-plaintiff was entitled for grant of ad interim injunction or not. As
such, the order passed by the learned Single Judge did not contain the traits and trappings of
finality. If it is held otherwise, this will open a floodgate of appeals for parties who may even
challenge the order of adjournment or grant of time to the other side to file affidavit-in-reply.
We are therefore of the considered view that the order dated 2-4-2019 [Shyam Steel Industries
Ltd. v. Shyam Sel & Power Ltd., 2019 SCC OnLine Cal 9130] cannot be construed to be a
“judgment” within the meaning of Clause 15 of the Letters Patent and as such, the appeal to
the Division Bench of the High Court was not tenable.
27. We clarify that as held in Shah Babulal Khimji [Shah Babulal Khimji v. Jayaben D.
Kania, (1981) 4 SCC 8], we are holding so, taking into consideration the facts and
circumstances as they appear in the present matter.”
(Emphasis supplied)
17. The aforequoted observations make it evident that in the said case the order impugned
before the Hon’ble Division Bench of this Court had protected the interest of the
plaintiff in that case. In other words, the order neither affected the vital and valuable
rights nor worked serious injustice to the said plaintiff. The Hon’ble Supreme Court has
Page 18 of 34
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clarified that the said judgment had been passed “taking into consideration the facts
and circumstances as they” appeared in that matter.
18. Now the present case is one where the orders impugned have been passed in an
appeal under Order XLIII Rule 1(r) of the Code. Order XLIII Rule 1(r) of the Code reads
thus:-
“1. Appeals from Orders:
An appeal shall lie from the following Orders under the provisions of section 104, namely:-
***************** ******************* *****************
r) an Order under rule 1, rule 2 4[rule 2A], rule 4 or rule 10 of Order XXXIX;”
19. There can be no quarrel to the factual position that the order dated November 14,
2025 that has been impugned in the appeal before the learned Appellate Court was
passed by the learned Trial Court on an application praying for temporary as well as
ad interim injunction under Order XXXIX Rules 1 and 2 of the Code. However, it
needs to be tested whether the said order can be said to be one under Order XXXIX
Rules 1 and 2 of the Code. In order to form a prima facie opinion as regards the same,
the prayers made in the application for temporary injunction filed before the learned
Trial Court may be noticed:-
a. An order for temporary injunction restraining the Respondents/Defendants and/or their men
and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or
successor-in-office from interfering and/or disturbing in any manner whatsoever with the new
peaceful employment of the Petitioner/Plaintiff;
b. An order for temporary injunction restraining the Respondents/Defendants and/or their men
and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or
successor-in-office from suing by initiating any proceeding or suit against the
Petitioner/Plaintiff before any Forum including but not limited to any Forum in the UK
particularly in England and Wales, without the leave of this Learned Court as it will be
oppressive and vexatious;
c. An order for temporary injunction directing the Respondents/Defendants and/or their men
and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or
successor-in-office allowing the Petitioner/Plaintiff to continue with his peaceful employment in
the manner which the Petitioner/Plaintiff thinks fit and proper;
d. An order for temporary injunction restraining the Respondents/Defendants and/or their men
and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or
successor-in-office from giving any effect to the Articles of Association dated 12/04/2024 and
the shareholding agreement dated 14/04/2024 in relation to or in connection with the
pleadings as stated hereinabove and/or prejudicial to the interest of the Petitioner/Plaintiff;
e. An order for temporary mandatory injunction directing the Respondents/Defendants and/or
their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-
interest and/or successor-in-office by directing them to sell the shares of the
Petitioner/Plaintiff at a reserved price as pleaded hereinabove or as may be determined by
this Learned Court and thereafter to transfer the amount to the Petitioner/Plaintiff forthwith;
Page 19 of 34
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f. An enquiry be made into the proper valuation of the shares of the Petitioner/Plaintiff and
thereafter to mandatorily direct the Respondents/Defendants to pay such amount as may be
deemed fit and proper by this Learned Court;
g. Ad-interim injunction in terms of prayer (a) to (e);
h. Cost:
i. Such further and/or other order/s and/or direction/s be given as This Learned Court may
deem fit and proper;
20. Having regard to the aforesaid prayers, certain observations of the learned Trial Court
in the order dated November 14, 2025 merit attention:-
“9. The plaintiff has stated that defendant no. 1 is the resident of the jurisdiction of this
court; therefore, this case has been instituted in this court, and according to the plaintiff, he
has resigned from the employment of respondent/defendant no. 3 with the expiry of
31.08.2025, and as such, he was jobless for more than two months and again reemployed
from 03.11.2025. It is averred by the plaintiff that he has cogent reason to conclude that the
defendant will try to obtain an order in furtherance of the restrained of trade clause, which is
completely void and inoperative in India.
10. The plaintiff has knocked the door of this court on the ground that defendant 1 will
make a distress sale of the share of the plaintiff, preferably to one or more of the respondents.
It is further stated that defendant no. 1 in communication in October 2025 explicitly
threatened to initiate legal proceedings against the plaintiff if he is reemployed unless he
signs a buyback agreement that will enable the company to buy back the shares at the issue
price of 1 British pound per share. The plaintiff has further stated that the defendant will
obtain an injunction from the UK court barring the plaintiff from working with his new
employer and has also threatened the plaintiff to tarnish his image and reputation. The
plaintiff is seeking a quia timet action to restrain the defendant from carrying out the
threatened legal action. Learned Counsel appearing on behalf of the plaintiff has emphasized
that the restriction imposed by the defendant is void and violative of Section 24 and Section
27 of the Indian Contract Act.
11. Now the plaintiff is seeking an ad interim injunction order.”
21. The above observations would show that the learned Trial Court was quite alive to the
pleadings made in the application for injunction and the urgency pleaded. In
paragraph 12 of the order, the learned Trial Court has referred to the various
documents that were relied on by the plaintiff/opposite party in support of his case for
ad interim injunction. In paragraph 13 of the order the learned Trial Court has posed
the question that it proposed to answer and then in paragraphs 21 and 22 thereof the
learned Trial Court held thus:-
“21. In the light of the aforesaid deliberation, prima facie, it appears that the plaintiff has
passed the ‘litmus test of ad interim in regard to prayer (a) of the Ad interim/Temporary
injunction application. It is to underscore that all other prayers will be decided by this Court
after giving an audience to the defendants… It is limpid to this court that if an order of ad
interim injunction is not passed, it will cause loss or prejudice to the plaintiff, provided that it
has been passed by adhering to the settled rubric pertaining to injunction jurisprudence. It is
limpid that the plaintiff has been able to pass the “three pillars triple test” by establishing his
prima facie case, showing the balance of convenience and inconvenience tilted in his favour,Page 20 of 34
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and also showing that if the defendants are not prohibited at this stage, then the plaintiff
would suffer irreparable loss and injury beyond monetary relief.
22. In the light of the above, considering the urgency of the matter, this court is inclined to
allow the prayer for an interim injunction in the form of restraining defendants from disturbing
in any manner whatsoever the new peaceful employment of the plaintiff.”
22. The learned Trial Court then proceeded to grant the ad interim relief as indicated by it
in the paragraphs quoted hereinabove with the following directions in paragraph 24
thereof:-
“24. Issue notice upon the defendants to show cause within 15 days from the date of
receipt of the notice as to why the plaintiff’s prayer for a temporary injunction shall not be
made absolute………..”
23. On a wholesome reading of the order in the light of the prayers made, it will be clear
that it is a case where – there were prayers made for ad interim reliefs in the
application for injunction; the application was pressed ex-parte for ad interim reliefs;
the learned Trial Court considered the application in totality and directed issuance of
notice to the defendants to show cause why the plaintiff’s prayer for a temporary
injunction shall not be made absolute while observing that the “plaintiff has passed
the litmus test of ad interim in regard to prayer (a) of the Ad interim/ Temporary
injunction application”.
24. Does this not demonstrate the Court’s implied conclusion that the plaintiff (opposite
party) had failed the “litmus test of ad interim” as regards the other prayers, all the
more so when the defendants have been called upon to show cause why the plaintiff’s
prayer for temporary injunction will not be made absolute? In the prima facie view of
this Court, the answer is in the affirmative and the learned Trial Court has impliedly
refused the ad interim reliefs at least at the ex-parte stage.
25. There are two reasons for this Court to arrive at such conclusion. Firstly, if the
opposite party had passed the tripod test for ad interim injunctions as regards all the
ad interim reliefs, then the other ad interim reliefs would have been granted. Secondly,
if the learned Trial Court had merely postponed the decision then it would have asked
the defendants to show cause why ad interim reliefs as prayed for would not be
granted and not “why the plaintiff’s prayer for a temporary injunction shall not be made
absolute”. More than three decades back an Hon’ble Division Bench of this Court had
in the case of Jagjit Singh Khanna vs. Dr. Rakhal Das Mullick & Another16
succinctly summed up the difference between the two stages of grant of interim reliefs
under Order XXXIX Rules 1 and 2 in the following manner:-
16 1987 SCC OnLine Cal 88 : AIR 1988 Cal 95 : (1987-88) 92 CWN 190
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“4. Both the applications for ad interim/temporary injunctions must, therefore, be treated
as applications under S. 94(c) read with O. 39 of the Code, even though the first one was
labelled as one under O. 39 only and the second one as one under S. 94 only. The net
question, therefore, is that if a Court has refused ad interim injunction and has only issued
notice to show cause on an application for temporary injunction, can it, on a subsequent
application, grant ad interim injunction till the disposal of the earlier application for temporary
injunction. A temporary injunction may, as it very often does, consist of two stages, one
granted without finally disposing of the application for injunction to operate immediately till
the disposal of the said application and the other granted while finally disposing of the main
application to enure generally till the disposal of the suit and while the former is generally
classed as ad interim injunction, the latter is generally called temporary injunction. Neither on
principle nor on authority we find any bar to the Courts granting ad interim injunction till the
disposal of the application for the temporary injunction, if subsequent developments or altered
circumstances warrant such grant, even though it has refused to grant the same earlier on the
materials then on record. If, however, the materials on record stand as they stood when the
ad interim injunction was refused earlier, a grant of ad interim injunction on such materials
may not be permissible as that might amount to impermissible review of the earlier order.”
(Emphasis supplied)
26. This was reiterated by another Hon’ble Single Bench of this Court in the case of Fiona
Ray vs. Sipra Roy & Another17 thus:-
“26. On perusal of the provisions contained in Order 39 Rules 1 and 2 as well as the
provision contained in Order 39 Rule 3 of the Code of Civil Procedure, this Court has no
hesitation to hold that Order 39 Rules 1 and 2 are the only enabling provisions which
authorise the Court to pass interim injunction; be it ad interim or temporary. In fact, temporary
injunction consists of two stages, i.e., first stage–ex parte ad interim injunction and second
stage –contested temporary injunction. Ad interim injunction can be extended upto the
disposal of the temporary injunction petition and temporary injunction continues upto the
disposal of the suit.”
(Emphasis supplied)
27. Viewed in the light of the aforesaid legal position, the language of the order passed by
the learned Trial Court prima facie suggests that the learned Trial Court had impliedly
refused all the ex-parte ad interim reliefs except the one in terms of prayer (a).
28. As to whether a case for grant of the other ad interim reliefs was actually made out or
not is a different matter altogether. However, in the facts of this case, prima facie, it
cannot be said that there was no order under Order XXXIX Rules 1 and 2 of the Code.
29. This Court is alive to the definition of the expression “order” in Section 2(14) of the
Code which reads thus:-
“(14). “order” means the formal expression of any decision of a Civil Court which is not a
decree;”
30. It can well be argued that deemed refusal of relief is not a formal expression of any
decision. It is also noteworthy that while there is a clarification as regards deemed
17 (2008) 2 CHN 402
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decrees under Section 2(2) of the Code and a provision for implied refusal of reliefs
claimed in the plaint, if the same are not expressly granted by the decree, under
Explanation V to Section 11 thereof, there is no such provision as regards orders in
the Code. In fact excepting cases where interlocutory orders have attained finality18
there can be no application of the principles of res judicata at interlocutory stages (and
all the more so for ex-parte ad interim stages).
31. Would it, therefore, mean that in all cases where several ad-interim reliefs have been
claimed and pressed ex-parte, grant of only one of them or a few of them while
postponing the other would not amount to implied refusal of the said ad interim relief
at the ex-parte stage? The answer has to be in the negative. It cannot be so in all
cases while it may so in many cases. As settled by the Hon’ble Supreme Court in
Shah Babulal Khimji (supra) and reiterated in Shyam Sel And Power Limited &
Another (supra) the question has to be answered having regard to the facts of the
given case and there cannot be a blanket proposition covering all cases.
32. To wit, there may be cases where ad interim reliefs have not been prayed for and only
a prayer for temporary injunction is made. Then there may be cases where ad interim
relief has been prayed for but has not been pressed at the ex-parte stage. In all such
cases issuance of notice would be clearly a procedural order and appeal would not lie.
Say for example an ex-parte ad interim relief against an order of demolition is prayed
for and the Court merely issues notice to the defendant, will it in such a situation not
amount to an order refusing ad interim injunction? The authoritative dictum of the
Hon’ble Supreme Court in the case of Shah Babulal Khimji (supra) which has been
followed in Shyam Sel And Power Limited & Another (supra) provides a perfect
answer to such a question. In such a case the order would be one that would affect
vital and valuable rights of the parties and which work serious injustice to the party
concerned and would therefore be appealable.
33. Here again, the question as to whether in the order passed by the learned Trial Court
has affected valuable rights of the opposite party and worked serious injustice to him
would be a question of facts which would be required to be answered by the learned
Appellate Court after examining the facts of the case in the light of the law on the
subject.
34. In the present case as already indicated hereinabove, the appeal is one under Order
XLIII Rule 1 of the Code which provides for appeals against orders. It is a remedial
18 Satyadhyan Ghosal vs. Deorajin Debi, 1960 SCC OnLine SC 15 Arjun Singh vs. Mohindra Kumar, 1963
SCC OnLine SC 43
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provision which must be construed reasonably, practically and liberally such that any
doubt as regards the right of appeal is resolved in favour of the right.19
35. If the appeal is prima facie maintainable, it would now be required to be examined
whether the orders impugned in the revisional applications before this Court suffer
from illegality and material irregularity warranting interference.
36. The order dated November 18, 2025 is the main order granting ex-parte ad interim
injunction. That needs to be tested first.
37. The petitioners have asserted that the order is unreasoned. The opposite party has on
the other hand argued that once an order is rendered after considering the detailed
submissions of the appellants, it cannot be said to be unreasoned.
38. The order dated November 18, 2025 has captured the arguments of the opposite party
(i.e. the appellant before the learned Appellate Court) in the first two pages and a little
less than half of the third page of the order. The reasoning starts thereafter which is
reproduced hereinbelow:-
“Heard the Ld. Advocate for the plaintiff/appellant.
Perused the voluminous documents filed by the plaintiff/appellant and other materials on
record.
Considering the urgency of the matter and finding prima facie case in favour of the plaintiff
in view of the Section 24 and 27 of The Indian Contract Act and Section 50 CA and Section 56
(2)(X) of the Income Tax Act and also finding the balance of convenience and inconvenience in
favour of the plaintiff, I am of the opinion that at this stage it is necessary to prevent
irreparable loss and injury caused to the plaintiff/appellant. Urgency is also evident from the
materials on record and if an ad-interim injunction as per prayer ‘a’ of the instant application
for temporary injunction is not passed at this stage, then there is every likelihood of
multiplicity of proceedings.
Thus, I am inclined to allow the ad interim order at this stage in respect of prayer (a) of the
instant application under Order 39 Rule 1 and 2 read with Section 151 of C.P.C. The prayer of
the plaintiff/appellant in respect of anti-suit injunction is refused at this stage as the said
relief can be granted sparingly in rare and exceptional circumstances and without affording
an opportunity of hearing to the respondents such an order cannot justifiably be passed ex-
parte.
Hence, it is,
ORDERED
that the prayer for an order of temporary injunction on ad-interim basis is allowed in favour
of’ the appellant in terms of prayer (a) of the application for temporary injunction under Order
39 Rule 1 and 2 read with Section 151 of C.P.C. till 18.12.2025.
The respondents and their men and agents are hereby restrained from taking any step to
sell any shares having number 1,00,000 of the plaintiff/appellant in favour of the
respondent/defendant no.2 without the leave of this Court till 18.12.2025.
The appellant is directed to comply with the provisions enumerated under Order 39 Rules
3(a) and 3 (b) of C.P.C.
Issue notices.
Fix 18.12.2025 for S/R and A/D.”
19 V.C. Shukla vs. State through CBI, 1980 Supp SCC 92; CIT vs. Ashoka Engineering Co., 1993 Supp (1)
SCC 754
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39. A perusal of the said order would reveal that the same only states the conclusions
which may be summarised thus:-
a) there is prima facie case in favour of plaintiff in view of the provisions of Section 24 and 27
of the Indian Contract Act and Section 50CA and 56(2)(X) of the Income Tax Act
b) finding balance of convenience and inconvenience in favour of the plaintiff
c) urgency is evident from the materials on record- and
d) if ad interim injunction as per prayer ‘a’ of the instant application is not passed at this
stage there is every likelihood of multiplicity of proceedings.
40. There is evidently no reason whatsoever to support the conclusions. There is nothing
to show how would there be violations of the various provisions of the statutes referred
to in the said order. Again there is no reason to justify why and how the balance of
convenience and inconvenience tilted in favour of the appellant/opposite party. Yet
again, there is nothing to convey which material on record persuaded the Court to
reach the conclusion that there was such an urgency involved in the matter that ex-
parte ad interim injunction was required to be granted. The learned Appellate Court
has ultimately held that if ad interim injunction is not passed there would be
multiplicity of proceedings but here again there is no discussion how there would be
multiplicity of proceedings. While on this it may be noted that the learned Appellate
Court has refused the appellant’s prayer for anti-suit injunction.
41. In this context, paragraph 58 of judgment of the Hon’ble Supreme Court in the case of
Asma Lateef & Another (supra) relied on by the petitioners becomes highly relevant.
The same is reproduced hereinbelow:-
“58. It is one of the cardinal principles of the justice delivery system that any verdict of a
competent judicial forum in the form of a judgment/order, that determines the rights and
liabilities of the parties to the proceedings, must inform the parties what is the outcome and
why one party has succeeded and not the other — the “why” constituting the reasons and
“what” the conclusion. Apart from anything else, insistence of the requirement for the reason(s)
to support the conclusion guarantees application of mind by the adjudicator to the materials
before it as well as provides an avenue to the unsuccessful party to test the reasons before a
higher court.”
42. Uniworth Resorts Limited & Another (supra), a judgment rendered by an Hon’ble
Single Judge of this Court, is also apposite to the context. Paragraph 11 thereof
deserves notice:-
“11. Judicial orders of such nature need to meet the twin tests of “why” and “what”. It is
the “why” that sustains the “what”. Reasons are the safeguard against the ipse dixit of the
decision making process. They discuss how the judicial mind has been applied to the matter
in issue and convey the nexus between the matters that have been considered and the
conclusion based thereon. The justification and the reasonableness of a conclusion depend on
the reasons given in support thereof. The order impugned has no element of “why” for the
“what” therein to stand on.”
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43. It must be borne in mind that the order passed by the learned Appellate Court is one
where the learned Appellate Court has granted something which was not granted by
the learned Trial Court. To be precise, the order impugned is not a case of affirmation.
Seen in such context the following observations of the Hon’ble Supreme Court in
paragraphs 5 and 6 of the judgment in the case of Sailesh Bhansali (supra) become
very relevant:-
“5. Law is well settled that an order of affirmation may not require elaborate reasons as
required in the case of an order of reversal but it does not mean that such order of affirmation
need not contain any reason at all. Whether or not there was application of mind can only be
disclosed by reason, howsoever briefly alluded to. If any authority is required, one may
profitably refer to the decision of this Court in Rani Lakshmi Bai Kshtriya Gramin
Bank v. Jagdish Sharan Varshney.
6. What follows from the above is that the ‘what’, i.e., the conclusion, must have the ‘why’,
i.e., the reasons (at least in brief), to stand on, which is conspicuous by its absence in the
impugned order of affirmation. On this short ground, we set aside the revisional order of the
BCI.”
44. The Hon’ble Supreme Court has in the case Bloomberg Television Production
Services India Private Limited & Others vs. Zee Entertainment Enterprises
Limited20 reiterated the well settled legal requirements that are to be fulfilled by a
Court while considering a prayer for ex-parte ad interim relief. That was also a case
where the order under consideration was somewhat similar to the one at hand. The
Hon’ble Supreme Court has in paragraph 2 of the judgment quoted the relevant
paragraph containing the reasons assigned by the learned Trial Court and then
observed as follows:-
“4. The threefold test of establishing: (i) a prima facie case, (ii) balance of convenience, and
(iii) irreparable loss or harm, for the grant of interim relief, is well-established in the
jurisprudence of this Court. This test is equally applicable to the grant of interim injunctions in
defamation suits. However, this threefold test must not be applied mechanically
[DDA v. Skipper Construction Co. (P) Ltd., (1996) 4 SCC 622, para 38 : (1997) 89 Comp Cas
362.] , to the detriment of the other party and in the case of injunctions against journalistic
pieces, often to the detriment of the public. While granting interim relief, the court must provide
detailed reasons and analyse how the threefold test is satisfied. A cursory reproduction of the
submissions and precedents before the court is not sufficient. The court must explain how the
test is satisfied and how the precedents cited apply to the facts of the case.
************************** ************************** **********************
10. The order of the trial Judge does not discuss, even cursorily, the prima facie strength of
the plaintiff’s case, nor does it deal with the balance of convenience or the irreparable
hardship that is caused. The trial Judge needed to have analysed why such an ex parte
injunction was essential, after setting out the factual basis and the contentions of the
respondent made before the trial Judge. The trial Judge merely states, in paras 7-8, that the
court has “gone through the record available as on date” and noticed certain precedents where
an ad interim injunction was granted. Without even cursorily dwelling on the merits of the
20 (2025) 1 SCC 741
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plaint, the ad interim injunction granted by the trial Judge amounts to unreasoned censorship
which cannot be countenanced.
11. Undoubtedly, the grant of an interim injunction is an exercise of discretionary power
and the appellate court (in this case, the High Court) will usually not interfere with the grant of
interim relief. However, in a line of precedent, this Court has held that appellate courts must
interfere with the grant of interim relief if the discretion has been exercised “arbitrarily,
capriciously, perversely, or where the court has ignored settled principles of law regulating the
grant or refusal of interlocutory injunctions”. [Ramdev Food Products (P) Ltd. v. Arvindbhai
Rambhai Patel, (2006) 8 SCC 726, paras 126 & 128; Shyam Sel & Power Ltd. v. Shyam Steel
Industries Ltd., (2023) 1 SCC 634, para 37 : (2023) 1 SCC (Civ) 301.] The grant of an ex parte
interim injunction by way of an unreasoned order, definitely falls within the above
formulation, necessitating interference by the High Court. This being a case of an injunction
granted in defamation proceedings against a media platform, the impact of the injunction on
the constitutionally protected right of free speech further warranted intervention.
12. In view of the above, the High Court ought to have, in our view, also at least prima
facie assessed whether the test for the grant of an injunction was duly established after an
evaluation of facts. The same error which has been committed by the trial Judge has been
perpetuated by the Single Judge of the High Court. Merely recording that a prima facie case
exists, that the balance of convenience is in favour of the grant of injunction and that an
irreparable injury would be caused, would not amount to an application of mind to the facts of
the case. The threefold test cannot merely be recorded as a mantra without looking into the
facts on the basis of which an injunction has been sought. In the absence of such a
consideration either by the trial Judge or by the High Court, we have no option but to set aside
both the orders of the trial Judge dated 1-3-2024 and of the Single Judge of the High Court
dated 14-3-2024 [Bloomberg Television Production Services India (P) Ltd. v. Zee Entertainment
Enterprises Ltd., (2024) 4 HCC (Del) 99]. We do so accordingly.”
45. The situation in the present case is no different from what was there before the
Hon’ble Supreme Court. The relevant portion of the order dated November 18, 2025
passed by the learned Appellate Court has already been extracted hereinabove which
would reveal that the same also only records the submission of the learned Advocate
for the appellant (i.e. the opposite party herein) and then reaches the conclusions.
This Court is cognisant of the fact that Bloomberg Television Production Services
India Private Limited & Others (supra) was a case of defamation, but the principles
stated therein are of universal application to matters pertaining to grant of ex-parte ad
interim injunctions.
46. It had been argued by the petitioners that the learned Appellate Court has passed an
order of injunction restraining the petitioners from selling the subject shares without
appreciating that such an interim relief had not been prayed for by the opposite party
before the learned Trail Court.
47. The opposite parties have on the other hand argued that both prayer ‘e’ of the
injunction application before the learned Trial Court seeking a direction on the
defendants to sell the shares at the reserve price or at such price as determined by the
learned Court and prayer ‘a’ of the application for injunction before the learned
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Appellate Court seeking restraint orders on the defendants from selling the shares of
the opposite party, are aimed at protecting the subject matter of the suit and they do
not run contrary to one another.
48. The prayers made in the injunction application before the learned Trial Court, have
already been quoted hereinabove. Now the prayers made in the injunction application
filed before the learned Appellate Court need to be noticed. The same are, as under:-
a. An order for temporary injunction restraining the Respondents/Defendants and/or their
men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest
and/or successor-in-office and/or directors, and/or shareholders, and/or any other
person/s in association with and/or in connection with the Respondents/Defendants from
taking any steps to sell and/or from selling any shares having number 100,000 of the
plaintiff in favour of the Respondents/Defendant No. 2 without the leave of the Learned
Court;
b. An order for temporary injunction restraining the Respondents/Defendants and/or their
men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest
and/or successor-in-office and/or directors, and/or shareholders, and/or any other
person/s in association with and/or in connection with the Respondents/Defendants from
taking any steps to institute and/or from instituting any proceeding/s without the leave of
This Learned Court;
49. On a comparison of the two sets of prayers it will be evident that prayer ‘e’ made
before the learned Trial Court is clearly inconsistent with prayer ‘a’ made before the
learned Appellate Court.
50. While the former is a prayer for mandatory injunction directing the defendants to sell
at a particular price the latter is one for prohibiting the defendants from selling the
shares at all. The opposite partys’ argument therefore, fails to appeal.
51. Rather, on a deep analysis, prayer ‘d’ of the injunction application before the learned
Trial Court can, in a sense, be said to be gravid with prayer ‘a’ before the learned
Appellate Court. To be precise, prayer ‘a’ before the learned Appellate Court is a
request for injunction on a portion of the SHA as well as the AoA whereunder the
parties (i.e. the petitioners and the opposite party) had agreed to a share-buyback
mechanism. If it is compared with the prayer ‘d’ made in the application for temporary
injunction before the learned Trial Court, it would be clear that prayer ‘a’ before the
learned Appellate Court is a subset of prayer ‘d’ before the learned Trial Court. It can
be argued that if prayer ‘d’ before the learned Trial Court had been granted prayer ‘a’
before the learned Appellate Court would have stood answered anyway because in
such case the petitioners would not have been able to act in terms of the SHA and the
AoA and consequently could not have enforced the buyback of shares.
52. However, even if the matter is viewed from such angle, the problem does not get solved
and that by itself does not make the order dated November 18, 2025 any better.
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Firstly, the moment the prayers are so interpreted, the order dated November 18, 2025
assumes the character of an order of reversal in the sense that what was impliedly
refused by the learned Trial Court has been granted by the learned Appellate Court. In
fact the learned Appellate Court has explicitly observed so in the fourth paragraph at
the first page of the order. That being the position, the learned Appellate Court was
required to return a threshold prima facie finding indicating, as to why was the order
passed by the learned Trial Court bad in not granting the other ex-parte ad interim
reliefs to the opposite party. There is, however, neither any discussion nor any prima
facie finding on such aspect in the order dated November 18, 2025.
53. Secondly, while considering prayer ‘d’, the learned Trial Court assessed the prima facie
case, balance of convenience and inconvenience and irreparable injury for a blanket
freeze on the entire contract and it was never required to weigh the balance of
convenience specifically regarding sale of shares. The learned Appellate Court on the
contrary has granted a specific injunction without any prima facie finding as to how
the learned Trial Court erred in doing what it did. It is well settled that the scope of an
appeal under Order XLIII Rule 1 of the Code is limited to examining the correctness of
the order under challenge before it. While examining such order at ex parte at the ad
interim stage, will the learned Appellate Court, be entitled to pass an order which was
never explicitly prayed for before the learned Trial Court? Such a question would be
required to be answered by the learned Appellate Court.
54. Thirdly and most importantly, if such a prayer had been asked for by the opposite
party before the learned Trial Court and the learned Trial Court had granted it, then
the petitioner would have had a forum for appeal. Making a prayer for the first time in
the learned Appellate Court without expressly asking for the same before the learned
Trial Court would rob the opposing party of a forum of appeal as has happened in the
present case. This aspect would also be required to be considered by the learned
Appellate Court while considering the opposite party’s prayer for injunction.
55. Extensive arguments were made by the petitioners on the point that the learned
Appellate Court’s conclusion that “there is prima facie case in favour of plaintiff in view
of the provisions of Section 24 and 27 of the Indian Contract Act and Section 50CA and
56(2)(X) of the Income Tax Act” is entirely wrong inasmuch as FEMA violations cannot
be said to be void. In such context reliance was placed on Vijay Karia & Others
(supra). The opposite party on the other hand relied on Griesheim GMBH (supra) to
contend that any foreign judgment rendered sustaining a claim founded on breach of
FEMA laws and regulations framed thereunder would be inexecutable in India.
Regulation 9 of the Foreign Exchange Management (Overseas Investment) Regulations,
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2022 and Rule 16 of the Foreign Exchange Management (Overseas Investment) Rules,
2022 and clauses 2.2, 3.1 and 4.2 of the RBI Circular to contend that violation of Rule
16 is non-compoundable.
56. However, since the order dated November 18, 2025 contains no reason in support of
the ultimate conclusions that it indicates, it would not be proper for this Court to test
such conclusion and return a finding on the merits of the arguments made by the
parties without first knowing what weighed with the learned Appellate Court to reach
such conclusion and without the Courts of facts rendering the findings at the first
instance. That would, in a sense, lead to the assessment of the prima facie case of the
opposite party by the High Court under its supervisory jurisdiction at the threshold,
which should be avoided.
57. While it is true that this Court, in exercise of its jurisdiction under Article 227 of the
Constitution of India, can supply reasons if the ultimate conclusion is correct but then
that can be done only when the reasons assigned in support of such conclusion are
either inadequate or not fully right and not when there is no reason at all. It is
clarified that this observation does not mean that the conclusion reached by the
learned Appellate Court is correct. Such observation is only intended to explain that
the said conclusion cannot be tested by this Court in a vacuum. The order dated
November 18, 2025 therefore, deserves interference.
58. Moving on to the next order dated December 18, 2025, this Court finds that the said
order too deserves intervention. That is an order whereby the injunction granted
earlier was extended by the learned Appellate Court overruling the petitioners’
objection as regards the territorial jurisdiction of the Court. The learned Appellate
Court has postponed the decision on the objection to territorial jurisdiction by
observing as follows:-
“…..Upon hearing both the sides and on appreciation of the appearing circumstance,
specifically the fact that the ad interim order dated 18-11-2025 as passed by the Learned
Judge-in-charge of this Court has been placed under challenge before the Hon’ble High Court
at Calcutta in C.O.No.4439 of 2025, the matter being subjudiced, this Court is of its prima
facie view that passing any order pending challenge before the Hon’ble Court is contrary to
the principles of judicial propriety and comity and when the matter is pending before the
Hon’ble High Court at Calcutta, this Court should restrain and avoid passing order that could
circumvent, prejudice or render infructuous the proceeding. It has also been settled by the
Hon’ble Courts that once an appeal is filed, the decision loses its character of finality and
what was once res judicata again becomes res sub-judice, i.e., a matter under judicial inquiry.
Therefore, at this juncture, this Court is of its opinion that when a revisional application has
been filed against the order of this Court before the Hon’ble High Court, the same issue
becomes a pending matter. Accordingly, this Court as on this day strictly avoids to set aside
the order which is already under challenge before the Hon’ble Court as per the prayer of the
respondents that the Civil Court in India has no territorial jurisdiction to try the case on thePage 30 of 34
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basis of contractual obligations between the parties to the suit and the order from the Court in
U.K. is binding upon the party to the Suit/Appeal.”
59. The reason assigned to extend the ad interim injunction granted ex parte fails to prop
the extension, even feebly. It is no reason at all, so to say. It well settled that at the
time of considering prima facie case the Court must be prima facie satisfied with the
existence of its jurisdiction to entertain such suit, be it territorial, pecuniary or
inherent21. Thus when the petitioners raised the point of lack of territorial jurisdiction
of an Indian Court to entertain the suit and therefore the appeal, the point should
have been addressed by the Court at least prima facie before extending the order of
injunction.
60. In such context the judgment of the Hon’ble Supreme Court in Asma Lateef &
Another (supra), which has been cited by the petitioners, provides an insightful
guidance in paragraph 50 thereof. The same is reproduced hereunder:-
“50. Although not directly arising in the present case, we also wish to observe that the
question of jurisdiction would assume importance even at the stage a court considers the
question of grant of interim relief. Where interim relief is claimed in a suit before a civil court
and the party to be affected by grant of such relief, or any other party to the suit, raises a
point of maintainability thereof or that it is barred by law and also contends on that basis that
interim relief should not be granted, grant of relief in whatever form, if at all, ought to be
preceded by formation and recording of at least a prima facie satisfaction that the suit is
maintainable or that it is not barred by law. Such a satisfaction resting on appreciation of the
averments in the plaint, the application for interim relief and the written objection thereto, as
well as the relevant law that is cited in support of the objection, would be a part of the court’s
reasoning of a prima facie case having been set up for interim relief, that the balance of
convenience is in favour of the grant and non-grant would cause irreparable harm and
prejudice. It would be inappropriate for a court to abstain from recording its prima facie
satisfaction on the question of maintainability, yet, proceed to grant protection pro tem on the
assumption that the question of maintainability has to be decided as a preliminary issue
under Order 14 Rule 2CPC. That could amount to an improper exercise of power. If the court is
of the opinion at the stage of hearing the application for interim relief that the suit is barred by
law or is otherwise not maintainable, it cannot dismiss it without framing a preliminary issue
after the written statement is filed but can most certainly assign such opinion for refusing
interim relief. However, if an extraordinary situation arises where it could take time to decide
the point of maintainability of the suit and non-grant of protection pro tem pending such
decision could lead to irreversible consequences, the court may proceed to make an
appropriate order in the manner indicated above justifying the course of action it adopts. In
other words, such an order may be passed, if at all required, to avoid irreparable harm or
injury or undue hardship to the party claiming the relief and/or to ensure that the proceedings
are not rendered infructuous by reason of non-interference by the court.”
61. The aforequoted paragraph would reveal that if the Court is of opinion at the stage of
hearing the application for interim relief that the suit is not maintainable it will assign
such reason for refusing interim relief. Asma Lateef & Another (supra) has after
21 Axis Bank Ltd. vs. MPS Greenery Developers Ltd., (2010) 3 CHN 112 (Cal)
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mandating that decision as regards jurisdiction or maintainability must precede an
order granting injunction, clarified that even in cases where taking final decision may
lead to irreversible consequences, the learned Court is still required to form at least a
prima facie opinion about the maintainability of the suit before passing an order of
injunction. The assertive instruction that “if an extra ordinary situation arises where it
would take time to decide point of maintainability of the suit and non-grant of protection
pro tem pending such decision could lead irreversible consequences the Court may
proceed to make an appropriate order in the manner indicated above justifying the
course of action it adopts” clearly reveals that the Court is not relieved of its duty to
return a prima facie finding as regards the maintainability of the suit before passing
an order of injunction.
62. There is in fact no justification in the order dated December 18, 2025 passed by the
learned Appellate Court for extending the order of injunction. The learned Appellate
Court has in effect only postponed the decision merely because of pendency of a
revision before this Court and has extended the injunction. That is not the mandate of
law.
63. It cannot be gainsaid that Court can in appropriate cases, not covered by Section 94
read with Order XXXIX Rules 1 and 2 of the Code use its inherent power to pass an
order of injunction but then that can also be done only if, at the first place the Court
has jurisdiction to pass such order. Decision as to jurisdiction is therefore imperative.
64. It was also argued before this Court that the learned Trial Court and the learned
Appellate Court lack jurisdiction to deal with the matter since the situs of the shares
which form the subject matter of the lis is at UK and there is an exclusive jurisdiction
clause in the SHA. Vodafone International Holdings BV (supra) was cited to assert
that the situs of the shares would be at the place where the relevant company is
incorporated and/or the place where the share can be dealt with by way of transfer. It
was contended that since the relevant company is incorporated in UK and the subject
shares are to be dealt with at UK, therefore, Indian Court would not have jurisdiction
over the same.
65. Modi Entertainment Network & Another (supra) was placed to demonstrate that
the principle that parties cannot by agreement confer jurisdiction on a Court that
lacks it applies to Courts to which the Code applies but this principle cannot be
extended to jurisdiction of foreign Courts and that in such cases, the English Courts
permit invocation of their jurisdiction. Relying on the said judgment, it was stressed
that a Court of natural jurisdiction would normally not grant anti-suit injunction
against a defendant before such Court if the parties have agreed to submit to the
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exclusive jurisdiction of another Court including foreign Court save in exceptional
circumstances for sufficient reasons in order to prevent injustice.
66. The opposite party has on the other hand cited Taprogge Gesellschaft MBH (supra)
and Regazzoni (supra) to counter the salvo aimed at the Court’s jurisdiction.
67. Here again, this Court would refrain for returning any finding on the jurisdiction of the
learned Courts to entertain the suit and hence the appeal on the grounds urged, since
the same ought to be decided by the same Court where it was first raised i.e. the
learned Appellate Court itself, at the threshold while deciding the prima facie case of
the opposite party.
68. In view of the discussion made hereinabove, the orders dated November 18, 2025 and
December 18, 2025 cannot be sustained. The same therefore stand set aside.
69. Insofar as the orders of extension of the initial order of injunction dated January 21,
2026, March 02, 2026, April 09, 2026 and order dated May 06, 2026 (included as a
part of C.O. 1513 of 2026 by way of a supplementary affidavit on May 21, 2026 upon
leave granted by this Court) are concerned, the same do not have any independent
existence. The same are dependent on the parent order dated November 18, 2025.
Once the same is set aside all of them would lose life instantly following the doctrine of
dependant orders22. It now well settled that orders of extension granted routinely,
without any fresh and independent application of mind are not required to be
challenged separately23.
70. The opposite party shall be entitled to renew its prayer for injunction on the next date
fixed and shall also be at liberty to pray for preponement of the date upon prior notice
to the petitioners, subject to the convenience of the learned Court. It is however made
clear that before taking any decision the learned Appellate Court must arrive at a
finding as regards the jurisdiction of the Court, at least prima facie apart from the
other essential prima facie findings and considerations required for deciding a request
for injunction.
71. However, since the interim order that has continued thus far is getting vacated and
this Court has prima facie found the opposite party’s appeal to be maintainable,
therefore, just by way of a short term equitable measure, it is directed that if the
petitioners are desirous of taking any step as regards the subject shares at any time
within a week from date, the petitioners would do so only upon putting the opposite
party on three working days’ prior written notice either by e-mail or physical mail.
22 Rikhabsao Nathusao Jain vs. Corpn. of the City of Nagpur, (2009) 1 SCC 240
23 Karnani Properties Limited vs. Harrow Hall, a Registered Society & Ors.; (2025)1 CHN 630
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CONCLUSION:
72. C.O. 4439 of 2025 along with the connected applications, C.O. 224 of 2026, C.O. 431
of 2026, C.O. 1513 of 2026 and C.O. 1052 of 2026 stand disposed of with the above
observations. No costs.
73. Urgent photostat certified copy of this order, if applied for, be supplied to the parties
on urgent basis after completion of necessary formalities.
(Om Narayan Rai, J.)
LATER:
After the judgment is pronounced, Mr. Dutta learned Advocate appearing for the
opposite party submits that the learned Appellate Court may be directed to prepone
the date on the prayer of the opposite party, however, such a mandatory direction
cannot be passed. The learned Appellate Court is requested to consider the opposite
party’s request for preponement of date, if made, and fix a date according to the
learned Court’s convenience upon notice to the petitioners.
(Om Narayan Rai, J.)
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