Delhi High Court
Bharat Heavy Electricals Limited vs Egyptian Electricity ... on 17 December, 2018
$~OS-6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 17.12.2018
+ CS(COMM) 675/2017
BHARAT HEAVY ELECTRICALS LIMITED..... Plaintiff
Through Mr.Amit Sibal, Sr.Adv. with
Mr.Prashant Mehta, Ms.Vasundhara Bhardwaj and
Mr.Soham Kumar, Advs.
versus
EGYPTIAN ELECTRICITY TRANSMISSION COMPANY & ORS
..... Defendant
Through None for D-1
Mr.Ravinder Sethi, Sr.Adv. with Mr.Ajay Monga,
Mr.Ateev Mathur, Mr.Amol Sharma and
Ms.Jagriti Ahuja, Advs.for D-2
Mr.Naresh Thanai, Mr.J.P.Singh, Ms.Khushboo
Singh and Mr.Tushar Sharma, Advs.for D-3
CORAM:
HON'BLE MR. JUSTICE JAYANT NATH
JAYANT NATH, J. (ORAL)
IA No.6074/2018
1. This application is filed under Order 39 Rule 4 CPC by defendant
no.3 seeking to vacate the interim order passed by this court on 3.10.2017.
This court on 3.10.2017 passed an interim order directing the defendants to
maintain status quo regarding the bank guarantees. Defendants No.2 and 3
were also restrained from transmitting to defendant No.1 the funds of the
Bank Guarantee as noted in that order.
2. The case of the applicant/defendant No.3 in the present application is
that defendant No.3 is a foreign entity formed and working in Egypt and it is
not amenable to the jurisdiction of this court. The grievance of the applicant
CS(COMM) 675/2017 Page 1
is that defendant No.2 is not releasing the amount of guarantees despite the
same being invoked by defendant No.3 in view of the interim order passed
in these proceedings. It is also pleaded that applicant/defendant No.3 has
filed its written statement without submitting to the jurisdiction of this court
and has filed the present application seeking vacation of the interim
injunction order dated 3.10.2017. It is pleaded that on the ex parte order
been granted to the plaintiff it was mandatory for the plaintiff to deliver to
the applicant a copy of the application for injunction together with copies of
affidavit, plaint and documents being relied upon by the plaintiff. Plaintiff
has failed to supply the same and has failed to comply with the mandatory
provision of Order 39 Rule 3 CPC.
3. It is further pleaded that on 19.9.2017 defendant No.1 had made
demands on the bank guarantees issued by defendant No.3. Therefore,
defendant No.3 in turn made demands under the counter guarantees issued
by defendant No.2. vide swift message sent on 28.9.2017. The applicant was
it is pleaded obliged to discharge the guarantees issued by it by paying the
guaranteed amount to defendant No.1. Hence, it is pleaded that defendant
No.3/applicant released fund to defendant No.1 on 20.12.2017. Hence, the
present application.
4. I have heard learned counsel for the parties. Learned counsel
appearing for the applicant has vehemently submitted that there is no non-
compliance of the provisions of Order 39 Rule 4 CPC and hence the interim
order ought to be vacated. He relies upon the judgments of the Supreme
Court in A.Venkatasubbiah Naidu vs. S.Chellappan and Others, (2000) 7
SCC 695 and; AGI Logistics Inc & Anr. vs. Sher Jang Bahadur & Anr.,
163(2009) DLT 137.
CS(COMM) 675/2017 Page 2
5. Learned senior counsel appearing for the plaintiff has pointed out tht
immediately after the injunction order was passed by this court on
03.10.2017 they had by courier on 10.10.2017 in compliance of the
provisions of Order 39 Rule 3 CPC dispatched the complete paperbook to
defendant No.3. The paper book was received on 15.10.2017. Reliance is
placed on a legal opinion filed by defendant No.3 dated 18.10.2017 which
notes that the counsel were approached on 15.10.2017 for its opinion. This
document it is pleaded shows that on 15.10.2017 courier has been delivered
to the defendant No.3. He also relies upon judgments of the Division Bench
in Himalaya Drug Company vs. SBL Limited, 194 (2012)DLT 536 and
judgments of this court in Nat Organic Chemicals Industries vs.
B.L.Industries, (1988) 34 DLT 232 and Ashwani Pan Products Pvt. Ltd.
vs. Krishna Traders, 2012 (128) DRJ 592 to plead that unless grave
prejudice is shown by the applicant/defendant No.3 there can be no reason to
vacate the interim order.
6. Order 39 Rule 3 CPC reads as follows:-
"3. Before granting injunction, Court to direct notice to
opposite party
The Court shall in all cases, except where it appears that the
object of granting the injunction would be defeated by the
delay, before granting an injunction, direct notice of the
application for the same to be give to the opposite party:
[Provided that, where it is proposed to grant an injunction
without giving notice of the application to the opposite party,
the Court shall record the reasons for its opinion that the
object of granting the injunction would be defeated by delay,
and require the applicant-
CS(COMM) 675/2017 Page 3
(a) to deliver to the opposite party, or to send to him by
registered post, immediately after the order granting the
injunction has been made, a copy of the application for
injunction together with-
(i) a copy of the affidavit filed in support of the
application;
(ii) a copy of the plaint; and
(iii) copies of documents on which the applicant
relies, and
(b) to file on the day on which such injunction is granted
or on the day immediately following, that day, an
affidavit stating that the copies aforesaid have been so
delivered or sent.]"
7. The Supreme Court in A.Venkatasubbiah Naidu vs. S.Chellappan
and Others (supra) held as follows:-
"15. What would be the position if a court which passed the
order granting interim ex parte injunction did not record
reasons thereof did not require the applicant to perform the
duties enumerated in clauses (a) and (b) of Rule 3 of Order
39. In our view such an order can be deemed to contain such
requirements at least by implication even if they are not
stated in so many words. But if a party, in whose favour an
order was passed ex parte, fails to comply with the duties
which he has to perform as required by the proviso quoted
above, he must take the risk. Non-compliance with such
requisites on his part cannot be allowed to go without any
consequence and to enable him to have only the advantage of
it. The consequence of the party (who secured the order) for
not complying with the duties he is required to perform is that
he cannot be allowed to take advantage of such order if the
order is not obeyed by the other party. A disobedient
beneficiary of an order cannot be heard to complain against
any disobedience alleged against another party."
8. Hence, the Supreme Court had noted that non compliance of such a
CS(COMM) 675/2017 Page 4
procedure cannot be allowed to go without any consequence and the
consequence would be that the party who is granted the interim order cannot
be allowed to take advantage of such order if the order is not obeyed by the
other party.
9. Similarly, this court in AGI Logistics Inc & Anr. vs. Sher Jang
Bahadur & Anr.(supra) held as follows:-
"14. If the Court were to take a lenient view and not insist on strict
compliance with the mandatory requirement of Order XXIX Rule
3, then it would be possible for most plaintiffs to continue to enjoy
an ad interim ex parte stay in their favour for any length of time
and plead genuine mistake by their counsel for non-compliance.
Numerous suits accompanied by applications seeking urgent ex
parte reliefs are filed in our courts everyday. The court, on a
perusal of the documents filed before it, forms a prima facie view
for grant of an parte ad interim injunction against the opposite
party, even in the absence of the opposite party. The Court at that
stage has no means of knowing what the version of the opposite
party is. The court, therefore, makes such interim order both time
bound and conditional. The condition is that there must be
compliance with Order XXXIX Rule 3 CPC within the time
specified by the court. Although Order XXXIX Rule 3(b) CPC
requires the filing of an affidavit of compliance 'on the day on
which such injunction is granted or on the day immediately
following that day', this Court has been granting a longer time
accounting for the fact that the certified copy of the order passed
by the court may not be available on the same day or even on the
next date. However, there is no question of the plaintiff not being
required to comply with the mandatory requirement of Order
XXXIX Rule 3 CPC within the time granted by the Court. In the
considered view of this Court, a strict compliance with the
mandatory requirement of this provision must be insisted and any
laxity shown to parties might well defeat the very purpose for
which such provision has been inserted."
10. The court was of the view that a lenient view cannot be taken when
CS(COMM) 675/2017 Page 5
there is failure to comply with order 39 Rule 3 CPC. In those facts as the
plaintiff had not complied with the provisions of Order 39 Rule 3 CPC the
interim order passed by this court was vacated.
11. A perusal of the reply filed by the plaintiff here would show that
alongwith the reply a copy of the receipt issued by DHL had been attached
which is purported to be proof of compliance of Order 39 Rule 3 CPC and
which is said to have been dispatched on 10.10.2017. It has been pleaded
that the complete paper book was dispatched.
12. At this stage, learned counsel for defendant No.3 raises a controversy
that the total weight of the packet is only 0.05 gram and hence the complete
paper book has not been sent.
13. In my opinion, the receipt which has been attached to the reply is
prima facie proof of dispatch to defendant No.3. The weight of the packet is
0.5 kg. The applicant admittedly was aware of the interim order on
15.10.2017.
14. The next issue is as to whether there was delay in compliance of the
Provisions of Order 39 Rule 3 CPC and if so what is the effect thereof. The
fact is that compliance is purportedly made one week after the interim order
was passed, namely, on 10.10.2017. Order 39 Rule 3 CPC requires that the
party who has been granted injunction order must within 24 hours file an
affidavit of having dispatched the necessary documents to the other side. In
this case there is delay of 7 days. What would be the effect of such delay?
15. Reference in this context may be had to the judgment of this court in
Nat Organic Chemicals Industries vs. B.L.Industries (supra). This court
while dealing with Order 39 Rule 3 CPC held as follows:-
"8. Coming to the facts of the present case, the injunction was
CS(COMM) 675/2017 Page 6
granted on 17th December 1987, 18th December, 1987 was the
last working day when the Court functioned. According to the
report of the Local Commissioner the defendant became aware of
the injunction on 23rd December, 1987 when the Commissioner
gave a copy of the injunction order to the representative of the
defendant. It is true that there was delay on the part of the
plaintiff in complying with the provisions of Order 39 Rule 3
proviso. According to the plaintiff, it got a copy of the order of
this Court granting the injunction only on the evening of 18th
December, 1987. Provisions of proviso to Order 39 Rule 3 does
not require the plaintiff co send copy of the order to the
defendant. The requirement of the proviso to Order 39 Rule 3 is
to deliver to the opposite party or to send by registered post copy
of the application of injunction, copy of the plaint etc. The
plaintiff could and ought to have taken necessary action under the
said proviso either on the day when the injunction was granted or
on the following day. It appears that the plaintiff complied with
the provisions of Order 39 Rule 2 proviso only on 26th
December, 1987 when the said documents were sent by
registered post. Thereafter the Court reopened after vacation and
on 4th January, 1988 affidavit as provided by Order 39 Rule 3
proviso was filed by the plaintiff.
9. From the facts enumerated above, it does appear that there has
been a lapse on the part of the plaintiff in not complying with the
provisions of Order 39 Rule 3 proviso. The question which
however, arises is that has that lapse resulted in any serious
prejudice being caused to the defendant. As. I have already noted
above the Court closed for winter vacation after 18th December,
1987 and re-opened on 4th January, 1988, though the Registry of
the High Court opened on 2nd January, 1988 for the purpose of
filing. It is before 2nd January, 1988 that the defendant had been
served both with the order of injunction as well as copy of the
application for injunction, plaint, affidavit in support of the
injunction and copies of the documents on which the applicant
relied. As such the defendant could take appropriate action either
in filling a reply to the application under Order 39 Rules 1 and 2
and/or filing an independent application under Order 39 rule 4
CS(COMM) 675/2017 Page 7
immediately on the reopening of this Court. The delay in sending
the documents to the defendant has not, in my opinion, caused
any serious prejudice to the defendant."
16. Facts in the present case are somewhat identical to the facts of the
above judgment. In that case, the court concluded as no serious prejudice
was caused to the defendant, the interim order passed by this court would
not automatically stand vacated. In the present case also, I may note,
defendant No.3 has not been able to show what prejudice was caused to him
by the delay of 6-7 days in despatch of the documents sent by the plaintiff.
17. However, I need not dwell further into this aspect in view of the
conduct of defendant No.3. The case of defendant No. 3 is that they are
outside the jurisdiction of this court and are not bound to comply with the
interim orders passed by this court. It is an admitted fact that the injunction
order of this court dated 03.10.2017 was known to defendant No. 3 on
15.10.2017 though it claims that it received knowledge of this interim order
from defendant No.2. Acting contrary to the interim order defendant No.3
has released payment to defendant No.1. It is manifest that no prejudice
whatsoever was caused to defendant No. 3. Defendant No. 3 has not obeyed
the interim order passed by this court but defendant No. 3 prays for vacation
of the interim order on the ground that there was delay in compliance of
Order 39 Rule 3 CPC. It is settled proposition of law that "He Who Seeks
Equity Must Do Equity". Defendant No. 3/applicant himself has clearly
stated that he is not bound to obey the interim orders. He himself is guilty of
misconduct and cannot heard to say that the plaintiff is guilty of misconduct
and hence the defendant should be granted relief. He cannot now say that on
non-compliance of the procedural requirement of Order 39 Rule 3 CPC, the
CS(COMM) 675/2017 Page 8
interim order should be vacated.
18. I see no merit in the application and the same is dismissed.
IA No.14196/2017 & 15291/2017
List on 1.2.2019 at 3:15 PM for arguments.
IA No.17212/2018
Issue notice to defendant No.3. Learned counsel for defendant No.3
accepts notice. Reply be filed within three weeks. Rejoinder, if any, be filed
within four weeks thereafter.
List on 1.2.2019.
CS(Comm.) 675/2017
None has appeared for defendant No.1. Defendant No.1 is proceeded
ex parte. Written submissions have been filed by learned senior counsel for
defendant No.2.
List on 1.2.2019.
JAYANT NATH, J
DECEMBER 17, 2018
n
CS(COMM) 675/2017 Page 9
