1. The present petition has been filed under Section 9 of the
Arbitration and Conciliation Act, 19961, seeking the following
reliefs:
2. The Petitioner is a company duly incorporated in India under
the Companies Act, 1956, having its registered office at K-18 Hauz
Khas Enclave, New Delhi, India. Respondent No. 1 is a company
engaged in the healthcare sector, having its registered office at 3,
Bahadur Shah Zafar Marg, Link House, New Delhi. Respondent No. 2
3. On 02.05.2016, the Petitioner and Respondent No.1 executed a
Radiology Services Agreement2 for a period of fifteen (15) years,
whereunder the Petitioner was entrusted with the responsibility of
establishing, managing and operating the Radiology Department at the
hospital premises of Respondent No.1 and was required, inter alia, to
render radiology services in a competent and uninterrupted manner in
compliance with applicable laws, to ensure that the equipment
installed met the prescribed standards, and to obtain and maintain the
requisite statutory permits and licences.
4. The Agreement was to remain in force until 02.05.2031, subject
to termination in accordance with Clause 10 thereof. Clause 10
provides for termination in specified contingencies, including
termination on account of a material breach, subject to issuance of
written notice and the grant of a cure period of forty-five (45) days.
Clause 13 of the Agreement contains the dispute resolution
mechanism, requiring the parties to first attempt resolution through
mutual discussions and, failing such resolution, to refer the disputes to
arbitration.
5. It is stated that after such an arrangement had been continuing
for several years, a meeting was convened between the representatives
of the parties. In the course of the said meeting, Respondent No.1
conveyed its intention to commence and operate the Radiology
Department independently with effect from 01.04.2026.
6. Thereafter, in December 2025, communications were
exchanged between the parties concerning various items of
radiological equipment installed in the Radiology Department,
including matters relating to commissioning and de-commissioning of
equipment, servicing and maintenance, and compliance with the
provisions of the Pre-Conception and Pre-Natal Diagnostic
Techniques (Prohibition of Sex Selection) Act, 19943 and the
regulatory framework under the Atomic Energy Act, 19624.
7. Pursuant to this, on 02.01.2026, Respondent No.1 issued a
Termination Notice5 alleging breaches of contractual and statutory
obligations and stating that the Agreement would stand terminated
with effect from 02.02.2026.
8. The Petitioner, vide its reply dated 08.01.2026 to the Impugned
Termination Notice, disputed the validity of said Notice, contending
that the Agreement was binding for a fixed tenure of fifteen years and
could be terminated only in the event of a contractual breach or by
mutual consent of the parties, neither of which had arisen.
9. Alleging violations of contractual obligations under the
abovementioned Agreement, the Petitioner has approached this Court
by way of the present petition seeking urgent interim measures,
including ad-interim injunctions restraining the operation and effect of
the Impugned Termination Notice, maintenance of status quo with
respect to the Radiology Department, and a prohibitory ad-interim
injunction restraining the Respondents from creating any third-party
rights or installing any radiology equipment at the Hospital.
10. Mr. Rajeev K. Virmani, learned Senior Counsel appearing on
behalf of the Respondents, would contend that the prayers sought in
the present petition are statutorily barred in view of Section 14(d) of
the Specific Relief Act, 19636, as it states that a contract which is in
its nature determinable cannot be specifically enforced. It would be
submitted that Clause 10 of the Agreement renders the Agreement as
one that is determinable in nature.
restrain or nullify the termination and thereby continue the
Agreement, is legally untenable.
13. Learned Senior Counsel for the Respondents would further
submit that, in any event, the reliefs sought in the present petition are
also barred under Section 14(b) of the SRA inasmuch as the
Agreement embodies continuing and reciprocal obligations requiring
sustained performance over a period of time. Grant of the reliefs
prayed for would necessarily involve constant judicial supervision of
such performance, which is impermissible in law. A contract
involving continuous duties that the Court cannot supervise is not
specifically enforceable.
14. Learned Senior Counsel would further contend that the present
petition does not disclose the complete and correct factual matrix
leading to the issuance of the Impugned Termination Notice. It would
be submitted that the termination was preceded by and founded upon
multiple and serious breaches on the part of the Petitioner, inter alia,
non-compliance with statutory requirements under the PC-PNDT Act
and the regulatory framework under the Atomic Energy Act, operation
and continued use of equipment which had reached end-of-life and
end-of-support status, failure to obtain or update requisite registrations
and endorsements in respect of installation and transfer of equipment,
engagement of unauthorised service agencies, and disruption of
uninterrupted radiology services owing to the non-functioning of
critical equipment.
15. Learned Senior Counsel would thus contend that these
violations, taken cumulatively, constituted breaches going to the root
of the Agreement and justified the action taken by Respondent No.1.
submit that the Respondents' reliance on Section 14(d) of the SRA is
wholly misconceived. It would be contended that not every contract
containing a termination clause is determinable in nature, and to
bolster this argument, reliance would be placed by the learned Senior
Counsel, on the judgment of the Hon'ble Supreme Court in K.S.
Manjunath and Others v. Moorasavirappa alias Muttanna
Chennappa Batil10, particularly paragraphs 62, 64 and 65, wherein the
Apex Court has clarified that the determinability of a contract must be
assessed with reference to its terms and the nature of rights and
obligations flowing therefrom.
18. Learned Senior Counsel for the Petitioner would further submit
that the Respondents' reliance on Section 14(b) of the SRA is equally
misplaced. The interim relief sought does not require this Court to
supervise continuous performance or undertake day-to-day monitoring
of reciprocal obligations. The Agreement has operated for nearly nine
years without judicial oversight, and the Petitioner merely seeks
preservation of the existing contractual framework and enforcement of
the negative covenants pending arbitration. Such limited protection
does not attract the statutory bar under Section 14(b) of the SRA.
19. Learned Senior Counsel for the Petitioner would contend that
the reliance placed on alleged "End-of-Life" communications,
temporary downtime of equipment, and supposed irregularities under
the PC-PNDT Act and other legal frameworks are wholly
misconceived, inasmuch as the equipment remained licensed, duly
maintained and compliant, and no adverse order has ever been passed
by any competent authority. The allegations, it would be urged, are
based on internal audit observations and selective reading of
documents, and do not disclose any fundamental violation warranting
termination of a long-term commercial contract.
20. Learned Senior Counsel for the Petitioner would further submit
that the Impugned Termination Notice is ex facie contrary to the
contractual mechanism. Even assuming any breach had occurred, the
Respondents were mandatorily required under Clause 10.2(a) to issue
a notice granting a cure period of forty-five (45) days. No such cure
notice was issued. It would therefore be contended that the termination
is arbitrary and in breach of the express terms of the Agreement.
21. It would further be submitted that once the foundational
requirement of a contractual cure period is disregarded, the
termination cannot be sustained in law, and all consequential steps
flowing therefrom would stand vitiated.
22. It would also be contended that the entire premise of the
Impugned Termination Notice is that the said breaches are incurable
in nature and the same is a unilateral determination without reference
to the contractual framework.
23. Lastly, learned Senior Counsel would submit that the well-
established triple test for the grant of an injunction stands satisfied in
the present case, with particular emphasis on the irreparable injury that
would be caused to the Petitioner in the form of loss of reputation and
erosion of goodwill, which are incapable of being adequately
compensated by damages or monetary relief and, therefore, necessitate
the interference of this Court by way of injunctive protection.
24. This Court has heard the learned Senior Counsel appearing on
behalf of the parties and, with their able assistance, has carefully
perused the paperbook and other material documents placed on record.
25. At the outset, this Court notes that it is conscious of the limited
compass of its jurisdiction under Section 9 of the A&C Act. The
power conferred thereunder is interim and protective in nature,
intended to preserve the subject matter of the arbitration and to
safeguard the efficacy of the arbitral process. At this stage, the Court
is required only to examine whether the well-settled parameters
governing the grant of interim relief, namely, the existence of a prima
facie case, the balance of convenience, and the likelihood of
irreparable injury, stand satisfied for the purposes contemplated under
Section 9 of the A&C Act. In ArcelorMittal Nippon Steel (India) Ltd.
v. Essar Bulk Terminal Ltd.11, the Hon'ble Supreme Court has
expounded upon the contours of such jurisdiction in the following
terms:
(2022) 1 SCC 712.
"88. Applications for interim relief are inherently applications
which are required to be disposed of urgently. Interim relief is
granted in aid of final relief. The object is to ensure protection of
the property being the subject-matter of arbitration and/or
otherwise ensure that the arbitration proceedings do not become
infructuous and the arbitral award does not become an award on
paper, of no real value.
89. The principles for grant of interim relief are (i) good prima
facie case, (ii) balance of convenience in favour of grant of interim
relief and (iii) irreparable injury or loss to the applicant for interim
relief. Unless applications for interim measures are decided
expeditiously, irreparable injury or prejudice may be caused to the
party seeking interim relief.
90. It could, therefore, never have been the legislative intent that
even after an application under Section 9 is finally heard, relief
would have to be declined and the parties be remitted to their
remedy under Section 17.
91. When an application has already been taken up for
consideration and is in the process of consideration or has already
been considered, the question of examining whether remedy under
Section 17 is efficacious or not would not arise. The requirement to
conduct the exercise arises only when the application is being
entertained and/or taken up for consideration. As observed above,
there could be numerous reasons which render the remedy under
Section 17 inefficacious. To cite an example, the different
arbitrators constituting an Arbitral Tribunal could be located at far
away places and not in a position to assemble immediately. In such
a case, an application for urgent interim relief may have to be
entertained by the Court under Section 9(1)."
(emphasis supplied)
26. The Hon'ble Supreme Court, in Essar House Pvt. Ltd. v.
Arcelor Mittal Nippon Steel India Ltd.12, has made some pertinent
observations concerning the nature and contours of the jurisdiction of
the Court under Section 9 of the A&C Act, which are extracted
hereinbelow:
"48. Section 9 of the Arbitration Act confers wide power on the
Court to pass orders securing the amount in dispute in arbitration,
whether before the commencement of the arbitral proceedings,
during the arbitral proceedings or at any time after making of the
arbitral award, but before its enforcement in accordance with
Section 36 of the Arbitration Act. All that the Court is required to
(2022) 20 SCC 178
see is, whether the applicant for interim measure has a good prima
facie case, whether the balance of convenience is in favour of
interim relief as prayed for being granted and whether the applicant
has approached the court with reasonable expedition
*****
49. Proof of actual attempts to deal with, remove or dispose of the
property with a view to defeat or delay the realisation of an
impending Arbitral Award is not imperative for grant of relief
under Section 9 of the Arbitration Act. A strong possibility of
diminution of assets would suffice. To assess the balance of
convenience, the Court is required to examine and weigh the
consequences of refusal of interim relief to the applicant for
interim relief in case of success in the proceedings, against the
consequence of grant of the interim relief to the opponent in case
the proceedings should ultimately fail."
27. The principal controversy in the present case turns upon the
question whether the Agreement executed between the parties is "in
its nature determinable" within the meaning of the SRA, as
contemplated under Section 14 thereof. This Court considers it
apposite to reproduce Section 14 of the SRA, which reads as follows:
"14. Contracts not specifically enforceable. --The following
contracts cannot be specifically enforced, namely: -
(a) where a party to the contract has obtained substituted
performance of contract in accordance with the provisions of
section 20;
(b) a contract, the performance of which involves the performance
of a continuous duty which the court cannot supervise;
(c) a contract which is so dependent on the personal qualifications
of the parties that the court cannot enforce specific performance of
its material terms; and
(d) a contract which is in its nature determinable."
28. Having delineated the statutory contours, it becomes necessary
to advert to the termination clause contained in the Agreement, as the
issue of determinability must be assessed with reference to the
contractual stipulations; accordingly, Clause 10 of the Agreement,
which governs termination, is extracted hereinbelow for ready
reference:
"10. TERM & TERMINATION
10.1. This Agreement shall be valid and binding between the
Parties commencing on the Effective Date and shall remain in force
for a period of 15 years from the Effective Date. It is agreed that
three months prior to the expiry of the Term, the Parties shall
mutually discuss the possibility of extending/renewing the Term of
this Agreement.
10.2. Notwithstanding anything contained above, this Agreement
may be terminated:
(a) By either Party forthwith upon written notice to the
other Party in the event of a material breach of the
provisions, including without limitation the
representations and warranties of the Parties of this
Agreement by any Party hereof ('"Breaching Party"),
which breach has not been remedied by the Breaching
Panty within forty five (45) days of receipt of written
notice requiring remedy of the such breach:
(b) By either Party forthwith upon written notice to the
other Party, if any proceedings under any law relating to
insolvency are commenced against the other Party or if
any Party makes un application under any such law for
being adjudged/declared an insolvent:
(c) Either party may terminate this agreement with mutual
consent by giving a 90 day written notice to the other
party. MIPL agrees and undertakes to remove itself from
the premises on the expiry of the ter or on the sooner
termination of this agreement.
10.3. The right of either Party to terminate this Agreement will be
in addition to any other remedies it may have. All remedies to
either Party under this Agreement are cumulative and not
alternative and may be enforced successively or concurrently.
10.4 Expiry/termination of this Agreement will be without
prejudice to any rights that either Party may have accrued against
the other prior to termination."
29. This Court takes note of the authoritative pronouncement of the
Hon'ble Supreme Court in K.S. Manjunath (supra). The said decision
undertakes a detailed contemplation of precedent on the concept of
contracts "in their nature determinable" within the meaning of Section
14 of the SRA, and elucidates the principles governing the grant or
refusal of specific performance in such cases. For the sake of ready
reference, the relevant paragraphs of the judgment are extracted
below:
"47. The High Court of Madras in A Murugan v. Rainbow
Foundation Ltd, 2019 SCC OnLine Mad 37961, had further
elaborated on the aspect of determinable contracts. For the purpose
of ascertaining determinability, the court bifurcated contracts into
several categories: (i) contracts that are unilaterally and inherently
revocable or capable of being dissolved such as licenses and
partnerships at will; (ii) contracts that are terminable unilaterally on
a "without cause" or "no fault" basis; (iii) contracts that are
terminable forthwith for cause or that cease to subsist "for cause",
without a provision for remedying the breach; (iv) contracts which
are terminable for cause subject to a breach notice being issued and
an opportunity to cure the breach being given, and; (v) contracts
without a termination clause, which could be terminated for breach
of a condition but not a warranty, as per applicable common law
principles. The court held that the abovementioned (iii), (iv) and
(v) categories of contract are not determinable contracts. The court
further observed that although the (iv) and (v) categories
are terminable yet the same cannot be said to be in
nature determinable. The relevant observations are as under:
"17. On examining the judgments on Section 21(d) of SRA
1877 and Section 14(c) of the Specific Relief Act, as
applicable to this case, i.e. before Act 18 of 2018, I am of
the view that Section 14(c) does not mandate that all
contracts that could be terminated are not specifically
unenforceable. If so, no commercial contract would be
specifically enforceable. Instead, Section 14(c) applies to
contracts that are by nature determinable and not to all
contracts that may be determined. If one were to classify
contracts by placing them in categories on the basis of
ease of determinability, about five broad categories can be
envisaged, which are not necessarily exhaustive. Out of
these, undoubtedly, two categories of contract would be
considered as determinable by nature and, consequently,
not specifically enforceable : (i) contracts that are
unilaterally and inherently revocable or capable of being
dissolved such as licences and partnerships at will; and
(ii) contracts that are terminable unilaterally on "without
cause" or "no fault" basis. Contracts that are terminable
forthwith for cause or that cease to subsist "for cause"
without provision for remedying the breach would
constitute a third category. In my view, although
the Indian Oil case referred to clause 27 thereof, which
provided for termination forthwith "for cause", the
decision turned on clause 28 thereof, which provided for
"no fault" termination, as discussed earlier. Thus, the
third category of contract is not determinable by nature;
nonetheless, the relative ease of determinability may be a
relevant factor in deciding whether to grant specific
performance as regards this category. The fourth category
would be of contracts that are terminable for cause
subject to a breach notice and an opportunity to cure the
breach and the fifth category would be contracts without a
termination clause, which could be terminated for breach
of a condition but not a warranty as per applicable
common law principles. The said fourth and fifth
categories of contract would, certainly, not be
determinable in nature although they could be terminated
under specific circumstances. Needless to say, the
rationale for Section 14(c) is that the grant of specific
performance of contracts that are by nature determinable
would be an empty formality and the effectiveness of the
order could be nullified by subsequent termination."
(Emphasis Supplied)
48. In Narendra Hirawat & Co. v. Sholay Media Entertainment
Pvt. Ltd., 2020 SCC OnLine Bom 391, the Bombay High Court
observed that the phrase "a contract which is in its nature
determinable" would mean a contract which is determinable at the
sweet will of a party to it, without reference to the other party or
without reference to any breach committed by the other party or
without any eventuality or circumstance. In other words, the phrase
would contemplate a unilateral right in a party to a contract to
determine the contract without assigning any reason. The relevant
observation is as under:
*****
49. The Delhi High Court in DLF Home Developers
Limited v. Shipra Estate Limited, 2021 SCC OnLine Del 4902,
while considering an agreement to sell a property held that the
question whether a contract is in its nature determinable must be
answered by ascertaining whether the party against whom it is
sought to be enforced would otherwise have the right to terminate
or determine the contract when the other party is willing to perform
and is not in default. In other words, where a contract cannot be
terminated so long as the other party remains willing to perform its
part, such a contract is not determinable and, in equity, is
specifically enforceable. The relevant observation is as under:
"78. Section 14 of the Specific Relief Act, 1963 sets out
certain classes of contracts that are not specifically
enforceable. One such class of contracts comprises of
contracts, which are in their nature determinable. Clause
(d) of Section 21 of the Specific Relief Act, 1877 expressly
provided that contracts which are in their nature
„revocable‟ are unenforceable. The said statute was
repealed and replaced by the Specific Relief Act, 1963.
Clause (c) of Section 14(1) of the Specific Relief Act, 1963,
as was in force prior to Specific Relief Act, 1877,
expressly provided that contracts, which are in the nature
determinable, were not specifically enforceable. The word
„revocable‟ as used in Clause (d) of Section 21 of the
Specific Relief Act, 1877 was replaced by the word
„determinable‟. The rationale for excluding such
contracts, which are in their nature determinable, from the
ambit of those contracts which may be specifically
enforced, is apparent. There would be little purpose in
granting the relief of specific performance of a contract,
which the parties were entitled to terminate or otherwise
determine. The relief of specific performance is an
equitable relief. It is founded on the principle that the
parties to a contract must be entitled to the benefits from
the contracts entered into by them. However, if the terms
or the nature of that contract entitles the parties to
terminate the contract, there would be little purpose in
directing specific performance of that contract. Plainly, no
such relief can be granted in equity.
79. Viewed in the aforesaid perspective, it is at once
apparent that the contract is in its nature determinable if
the same can be terminated or its specific performance
can be avoided by the parties. Thus, contracts that can be
terminated by the parties at will or are in respect of
relationships, which either party can terminate; would be
contracts that in their nature are determinable. If a party
can repudiate the contract at its will, it is obvious that the
same cannot be enforced against the said party.
80. However, if a party cannot terminate the contract as
long as the other party is willing to perform its
obligations, the contract cannot be considered as
determinable and it would, in equity, be liable to be
enforced against a party that fails to perform the same.
Almost all contracts can be terminated by a party if the
other party fails to perform its obligations. Such a
contract cannot be stated to be determinable solely
because it can be terminated by a party if the other party
is in breach of its obligations. The party who is not in
default would, in equity, be entitled to seek performance of
that contract. In such cases, it cannot be an answer to the
non-defaulting party's claim that the other party could
avoid the contract of the party seeking specific
performance, had breached the contract; therefore, the
same is not specifically enforceable. Thus, the question
whether a contract is in its nature determinable, must be
answered by ascertaining whether the party against whom
it is sought to be enforced would otherwise have the right
to terminate or determine the contract even though the
other party are ready and willing to perform the contract
and are not in default.
81. The contention advanced on behalf of Indiabulls that
the ATS is in its nature determinable as Indiabulls could
terminate it on failure of the other parties to perform their
obligations is, plainly, unmerited. This contention is
premised on the basis that Indiabulls is correct in its
assumption that the other parties had breached the terms
of their obligation. Concededly, if the other parties were
ready and willing to fully perform their obligations,
Indiabulls would not have any recourse to the termination
clause. Such recourse is contingent on the failure of the
other parties to perform the contract. It cannot be stated
that the contract by its very nature is not specifically
enforceable because it entitles a party to terminate the
contract if the other parties have failed to perform their
obligations.
xxx xxx xxx
94. The question whether the contract by its very nature is
determinable is required to be answered by ascertaining
the nature of the contract. Contracts of agency,
partnerships, contracts to provide service, employment
contracts, contracts of personal service, contracts where
the standards of performance are subjective, contracts
that require a high degree of supervision to enforce, and
contracts in perpetuity are, subject to exceptions, in their
nature determinable. These contracts can be terminated by
either party by a reasonable notice.
(Emphasis Supplied)
50. In Affordable Infrastructure & Housing Projects (P)
Ltd. v. Segrow Bio Technics India (P) Ltd., 2022 SCC OnLine
Del 4436, the lease deed provided for a termination clause. Under
the termination clause, the respondent had an option to terminate
the lease deed by serving a 15 days' written notice in case the
petitioner failed to make the payment for two consecutive months.
The Delhi High Court on the strength of DLF Home (supra)
observed that almost all contracts can be terminated by a party, if
the other party fails to perform its obligations and that such
contracts cannot be stated to be determinable solely because it can
be terminated by a party if the other party is in breach of an
obligation. The non-defaulting party would in equity be entitled to
seek performance of that contract. The court held that the question
whether a contract is in its nature determinable must be answered
by ascertaining whether the party against whom it is sought to be
enforced would otherwise have a right to terminate or determine
the contract even though the other party is ready and willing to
perform the contract and is not in default. The relevant observation
is as under:
"37. The law as stated above mandates against grant of
stay against Termination Notice in respect of the
Contracts which are determinable. The petitioner has
relied upon DLF Home Developers Limited v. Shipra
Estate Limited, (2022) 286 DLT 100, wherein it was
observed that a party cannot terminate the Contract so
long as the other party is willing to perform its
obligations. The Contract cannot be considered as
determinable as it would in equity be liable to be enforced
against a party that fails to perform the same. Almost all
Contracts can be terminated by a party, if the other party
fails to perform its obligations. Such a Contract cannot be
stated to be determinable solely because it can be
terminated by a party if the other party is in breach of the
obligations. The party who is not in default would in
equity be entitled to seek performance of that Contract. In
such cases, it cannot be an answer to a non-defaulting
party's claim that the other party could avoid the Contract
of the party seeking specific performance and the same is
not specifically enforceable. Thus, the question whether
the Contract is in its nature determinable must be
answered by ascertaining whether the party against whom
it is sought to be enforced would otherwise have a right to
terminate or determine the Contract even though the other
party is ready and willing to perform the Contract and is
not in default."
(Emphasis Supplied)
51. The Bombay High Court in Kheoni Ventures (P)
Ltd. v. Rozeus Airport Retail Ltd., (2024) 2 HCC (Bom) 60, also
observed that in order to arrive at a conclusion whether a contract
is determinable or not, it is to be ascertained whether the parties
have a right to terminate it on their own, without the stipulation of
any contingency and without assigning any reason. The relevant
observation is as under:
"11. In order to infer whether a contract is determinable
or otherwise, it is to be ascertained, whether the parties
have a right to terminate it on their own, without stipulation
of any contingency and without assigning any reason. An
inherently determinable contract would permit either party
to terminate it without assigning any reason and merely by
indicating, that the contract shall come to an end, either by
giving a notice for specified period, if stipulated or even
without such a notice."
(Emphasis Supplied)
*****
62. Since in principle unilateral termination of the contract is
impermissible except where the agreement is determinable within
the meaning of Section 14 of Act of 1963, it also becomes
necessary, at this juncture, to examine whether the ATS dated
28.04.2000 was in its nature determinable. This question requires
to be answered on a scrutiny of the terms of the ATS and the nature
of the rights and obligations flowing therefrom.
****
64. In this backdrop, it would be useful to advert to the
classification set out in A. Murugan (supra), wherein the Madras
High Court categorised contracts into five broad classes depending
on their ease of determinability. Out of those, the first two i.e., (i)
contracts inherently revocable such as licences and partnerships at
will, and (ii) contracts terminable unilaterally on a "without-cause"
basis, were held to be determinable in nature. The remaining
classes, namely, (iii) contracts terminable for cause without
provision for cure, (iv) contracts terminable for cause with
notice and opportunity to cure, and (v) contracts without a
termination clause but terminable only for breach of a condition,
were all held not determinable in nature.
65. Further, as laid down in DLF Home (supra), the question
whether a contract is in its nature determinable lies in ascertaining
whether the party against whom specific performance is sought has
the right to terminate the contract even when the other party is
ready and willing to perform. This means if the contract cannot be
terminated so long as the other party stands willing to perform, it is
not determinable in its nature and would, in equity, be specifically
enforceable. The same reasoning was followed in Affordable
Infrastructure (supra), where it was held that a contract terminable
for breach cannot merely for that reason be regarded as
determinable, otherwise, no contract could ever be specifically
enforced.
66. Applying these principles, the ATS in the present case cannot
be said to be a determinable contract. Viewed in light of the
classification as set out in A. Murugan (supra), the ATS would
squarely fall within category (v) as mentioned above. The ATS was
devoid of any clause enabling termination for convenience or
otherwise empowering either party to terminate unilaterally. The
only conceivable circumstance in which ATS could be brought to
an end in the present case was upon a breach of a condition by
either of the parties. Thus, the original vendors did not possess any
contractual right to terminate the ATS in the absence of default by
the original vendees. The grounds cited in the notice of termination
dated 10.03.2003, namely, the subsistence of a status quo order and
the death of one of the original vendors cannot be said to be based
on any default or breach by the original vendees. The original
vendees had performed their part by paying a substantial amount
and were also ready and willing to perform the terms of ATS."
(emphasis supplied)
30. It would suffice to observe that in paragraph 64 of the aforesaid
judgement, the Hon'ble Supreme Court has clearly delineated various
classes of contracts on the basis of the nature and manner of their
determinability. The Apex Court, approving the classification adopted
by the Madras High Court in A Murugan v. Rainbow Foundation
Ltd13, has clarified that contracts which are inherently revocable, such
as licences and partnerships at will, or those which are terminable
unilaterally on a "without cause" or "no fault" basis, would fall within
the ambit of Section 14(d) of the SRA, being determinable in nature.
31. In contradistinction, contracts which are terminable only for
cause, particularly where termination is conditioned upon the
existence of a breach and is subject to issuance of notice and affording
an opportunity to cure, do not fall within the category of contracts that
are determinable by their very nature.
32. Tested on the anvil of the aforesaid principles, Clause 10.2(a) of
the present Agreement does not confer an unfettered, unilateral, or at-
will right of termination. The right to terminate is expressly contingent
upon the occurrence of a material breach and is further circumscribed
by the mandatory requirement of issuance of a written notice granting
a cure period of forty-five (45) days. The contractual stipulation thus
squarely falls within the fourth category identified in paragraph 64 of
K.S. Manjunath (supra), namely, contracts terminable for cause
subject to notice and opportunity to cure, which have been held not to
be determinable in nature.
33. This Court also takes note of the judgment of this Court in HK
Toll (supra), which, after considering a catena of authorities, explains
the scope of the statutory embargo contained in Section 14(d) of the
SRA and underscores that the determinability of a contract must be
2019 SCC OnLine Mad 37961
examined in light of the termination stipulations agreed between the
parties. The reasoning adopted therein emphasizes that where
termination is conditioned upon specific contingencies or breaches,
and is not exercisable at the mere will of a party, the contract cannot
ipso facto be regarded as determinable in nature.
34. The above exposition, read holistically, clarifies that the
question whether a contract is "in its nature determinable" must
necessarily be answered with reference to the termination mechanism
embodied in the contract and the extent of the power reserved to the
parties thereunder. Where a contract envisages termination only upon
the occurrence of specified contingencies, particularly subject to
notice and cure provisions, and does not confer an unfettered right of
revocation, such a contract cannot be characterised as determinable in
the sense contemplated under Section 14(d) of the SRA.
35. Clause 10 of the Agreement in the present case provides for
termination strictly upon the occurrence of defined contingencies and
subject to compliance with a stipulated cure period. It does not vest
either party with an unqualified or at-will power of termination. The
issue of determinability must, therefore, be examined within that
contractual framework, and not divorced from the express stipulations
mutually agreed upon by the parties.
36. This Court finds merit in the submissions advanced by the
learned Senior Counsel for the Petitioner and is of the considered
opinion that the termination clause embodied in Clause 10 of the
Agreement is not in its nature determinable within the meaning of
Section 14(d) of the SRA. The mere existence of such a clause,
particularly one conditioned upon the occurrence of breach and
compliance with a cure mechanism, cannot operate as a statutory
embargo against consideration of interim protection. Consequently,
the bar under Section 14(d) of SRA is not attracted so as to preclude
the grant of interim relief against the Impugned Termination Notice.
37. Insofar as the objection founded upon Section 14(b) of SRA is
concerned, this Court is unable to accept the same. Section 14(b) of
SRA proscribes specific performance of a contract, the performance of
which involves a continuous duty that the Court cannot supervise. The
emphasis is on the nature of the obligation and the impracticability of
judicial supervision over its execution.
38. In the present case, Clause 10 of the Agreement does not
contemplate the enforcement of any continuous or minute operational
obligations requiring constant oversight by the Court. The relief
sought is confined to protection against termination pending arbitral
adjudication. A bare perusal of the Agreement itself delineates the
respective rights and obligations of the parties and does not require the
Court to regulate day-to-day performance or assume managerial
control over the arrangement.
39. To this Court's mind, the bar as contemplated under Section
14(b) of SRA would arise only where the Court is compelled to
remain in seisin of the matter and supervise the ongoing execution of
reciprocal duties. No such situation is presented here. Accordingly, the
bar under Section 14(b) of SRA is not attracted.
40. As respects the rival submissions touching upon the validity or
otherwise of the Impugned Termination Notice are concerned, the
same traverse into the merits of the underlying disputes between the
parties. Nevertheless, for the sake of completeness and convenience,
this Court considers it appropriate to reproduce herein the tabular
statement filed along with the Rejoinder by the Petitioner, which is
extracted as follows:
RADIOLO ALLEGATIO RESPONSE DOCUMENT
GY NS RAISED
EQUIPME VIDE REPLY
NT DATED
30.01.2026
Philips RES 8(a) @ Pg. 11: The said CT Machine
MX16 - CT 11-year delay was being run prior
Scan in intimation of Petitioner entering to
CT Scan the into the RSA
Machine to dated 02.05.2016.
Respondents The Petitioner took
the over the machine
(DOCUMENT when it entered into
R-3; Page the RSA.
110@ 112).
The license issued by
the Competent DOCUMENT
Authority which is [License issued
valid till 05.11.2026, competent R-3 by
thus on examination authority valid till
of the date of end of 05.11.2026] (Pg.
life as stated in the 113-115)
letter dated
1.08.2025, it is clear
that that as per the
statutory authority
the equipment is safe
to use.
As per rule 3 of the
Atomic Energy
Rules, no person
shall operate any
radiation generation
equipment without
the license, therefore
licence has been
given by the AERB
after confirming
itself that equipment
it safe to use till
05.11.2026, hence,
the allegation that the
equipment was
unsafe and unusable
for the patients is a
false and a malicious
statement to
somehow create a
breach in spite of a
valid license, issued
by the AERB
authority.
8(b)@ Pg. 12: The RSA nowhere DOCUMENT R-3
The Philips mandates the [Email dt.
RES MX16 Petitioner to convey 18.12.2025 issued
achieved end this information to by Mrs. Dolly
of life status on not the Respondents, Sharma to the
31.12.2025 and however when the Respondent] (Pg.
the same was information was 110)
intimated sought on DOCUMENT - 7
Respondent 18.12.2025, the same [email dt.
was promptly replied 18.12.2025, sent
to on the same date by the Respondent
itself along with to the Petitioner]
supporting.
Since the DOCUMENT R-4 as DOCUMENT R-4
machine has relied on by the [End of life notice
reached end of Respondents dated 1.08.2025
life, it will not nowhere states that sent by the
be serviced the manufacturer will manufacturer] (Pg.
anymore not service the 174)
machine. What it
clearly states is that
the manufacturer will
provide support to
the best of its ability
however the same
would be dependent
on parts availability.
It is nowhere
written that the
machine will not be
serviced at all. In
fact, the
manufacturer stated
that it will continue
to honour the service
agreement subject to
the above. The
document relied on
nowhere states that
the machine has
become
unusable/unsafe. End
of Life does not
mean the end of
clinical life of an
equipment.
8(c) @Pg. 12: The Petitioner had DOCUMENT -9
The CT itself informed the [Email
machine has Respondents about 22.12.2025]
stopped the breakdown of the (Pg.330 @332)
functioning CT machine and DOCUMENT 10
since further it was [Purchase Order of
28.12.2025. informed vide dated the new CT
22.12.2025 that email machine dt.
the Petitioner is in 23.12.2025] (Pg.
the process of 335)
ordering a new CT
machine in order to DOCUMENT R-5
replace the existing [WhatsApp dated
MX-16 machine. issued message
It was further 30.12.2025 the
informed that in the Petitioner] (Pg.
interim, CT scans of 175)
the patients will be
done in other centres
of the Petitioner, in
compliance with
Clause 4.2 of the
RSA.
8(d) @Pg. 12: The Respondent was DOCUMENT 9
The Petitioner well aware m [Email dt.
was asked in advance regarding 22.12.2025] (Pg.
continuation of the new CT machine 330 @ 332);
the being ordered vide DOCUMENT R-
Termination communications 10 [Response to
Notice period dated 22.12.2025, email dated
on 07.01.2026 02.01.2026 and email 27.12.2025] (Pg.
and was asked sent by Dr. Vaze 219@228)
to remove the prior to the DOCUMENT 15
said CT communication dated [Email dt.
machine, in 07.01.2026. 07.01.2026 sent by
order to let the Incorrect date of the Petitioner to
Respondent breakdown is the Respondent]
make the mentioned as the (Pg. 378)
alternate same could be DOCUMENT 16
arrangements. confirmed [letter dated
Respondents letter 07.01.2026 sent by
from dated the Respondent]
07.01.2026 wherein (Pg. 380)
they have clearly
breakdown
30.12.2025.
8(f) @Pg. 13: Customer Service DOCUMENT P-4
The machine Reports of Philips dt. [Customer service
has not 31.12.2025 which Report]
underwent any clearly evidence the
preventive and preventive and
corrective corrective
maintenance maintenance
and further undertaken by the
Philips has Petitioner. Even prior
clearly not to the same the
rendered any preventive and
such service. corrective
maintenance has
taken place at all
times service reports
dt. 31.12.2025, DOCUMENT P-3
21.08.2025,24.02.202 [PMS Reports]
520.02.2025,05.06.20
24, 28.05.2024 and
04.01.2024 attached.
Further the
preventive and
corrective services
printed by the
manufacturer
25.08.2025, dated
14.02.2025,
05.08.2024,
06.01.2024 so as to
answer the
respondents
allegation that the
same was never
conducted by the
petitioner is attached
here as DOCUMENT B
8(g) @Pg. 13: There is no DOCUMENT R-6
The Petitioner suppression as the [Request for sale
has suppressed Petitioner was and transfer of CT
the request nowhere mandated machine to the
12.01.2026 under the agreement appropriate
letter dt. and to intimate to the authority vide
permission for respondent. letter dt.
sale and information been 12.01.2026] (Pg.
transfer dated sought by Whenever 176)
19.01.2026 has the Respondents,
obtained from the same has been DOCUMENT R-7
the appropriate provided by the [Permission for
authority Respondent. Further sale and transfer of
such a permission is the CT machine
required and issued by
mandated as per appropriate
Rules 3a of the PC- authority vide
PNDT Rules, 1994 letter dt.
which the Petitioner 19.01.2026] (Pg.
has scrupulously 178)
followed.
8(j)@ Pg. 14- The Petitioner is in DOCUMENT 15
15: due compliance with [Email dt.
In accordance the Rule 13 of the 07.01.2026] (Pg.
with Rule 13 of PC-PNDT Rules as 378)
the PC-PNDT the delivery at site is
Rules, at least subjected to the DOCUMENT P-5
30 days statutory clearance.
advance notice
is to be given In furtherance, to the
statutory to the Purchase Order dated
authorities 23.12.2025, the
before Petitioner has
replacement of informed the
any equipment, Respondents vide
same was not email dated
given with 05.02.2026 Wherein,
regard to the the Petitioner has
Purchase order attached the
intimation letter
dated 05.02.2026,
and intimated the
Respondent about the
availability of the
new CT machine and
same to be installed
at Premises by the
Hospital 09.02.2026
subject to their
coordination to
which the
Respondent hasn't
respondent as of
06.02.2026
9 @Pg. 15-16: The allegations made
The Petitioner by the Respondents
has been using 1s unsupported and
end of life and mere speculations
end of support without any
equipment m contractual or
breach of its statutory support,
duties and with reference to the
obligations, end of life notice
(DOCUMENT R-4
@ Pg. 174) as relied
upon by the
Respondent also
finds no mentioning
that the said
equipment is not
usable or is unsafe.
GE Logiq l l(b)@Pg. 17: It is nowhere stated DOCUMENT 18 .
E9 The equipment in the mentioned (COLLY) [Letter
Ultrasound has achieved letter that the said for installation
(S. No. end of Life machine should be dated 08.06.2016]
200239US5 status in replaced after March (Pg.418)
) March, 2025 as 2025, it only states
declared by the that it cannot DOCUMENT R-9
supplier Wipro guarantee spare part [letter dt.
GE Healthcare availability and full 23.02.2023 sent by
Pvt. Ltd. and maintenance support Wipro GE
full support without any reference Healthcare Pvt.
cant be to the usability or Ltd.] (Pg. 218)
provided to safety of the
machine equipment in the
event of continued
use post March 2025.
l l(c)-(d) @ Pg. The petitioner is in DOCUMENT 18
17-18: The no way barred from (COLLY) [PC-
Petitioner did using the said PNDT
not dispute the equipment if the CERTIFICATE
fact that the same is compliant valid till
said machine with the applicable 27.04.2026] (Pg.
has achieved laws as evidenced 425)
end of life vide the PC-PNDT
status. The certificate and the
Petitioner same being issued by
alleged that the appropriate
this machine authority.
provides
optimal
functioning, is
in operation
and is duly
maintained.
11 (e) @Pg. The Petitioner has DOCUMENT R-
18: The not suppressed the 10 [Petitioner's
Petitioner has response dated Reply dated
suppressed its 02.01.2026 as the 02.01.2026 to the
response dated supports the same Respondent No.1
02.01.2026, Petitioner's case. email dated
which was an However, the 27.12.2025] (Pg.
attachment to attachment was 219@226)
its email dated inadvertently missed
02.01.2026. out by the Petitioner,
the same has been
evidently attached by
the Respondents in
its reply as Document
No. R-10. The same
supports the
Petitioner's case.
ll(g) @Pg. 18: No statutory or
Continued use contractual
of the said obligations state that
machine post the use of the said
its attainment equipment unreliable
of the End of or unsafe to the
Life is in patients. 1s These are
breach of mere speculation
Clauses 2.1 and without any basis
2.3 whether statutory or
contractual.
Philips En 12 (c)@ Pg. No statutory or DOCUMENT
Visor CHD 19: Petitioner contractual [Principles
Ultrasound that informed obligations state that Practices R-8 and
(S. No. despite the use of the said for the Cyber
US7050669 equipment this equipment unreliable Security of Legacy
4) having or unsafe to the Medical Devices,
achieved end patients. 2023] (Pg. 179)
of life status,
no steps were
taken by the
Petitioner to
get a new
equipment
12(d)@ Pg. The achievement of DOCUMENT 18
19-20: The the End of-Life status (COLLY)
petitioner did doesn't in any way [permission for
not dispute the affects the usability sale and transfer
fact that the and safety of the said dated 02.07.2024]
said machine equipment, the said (Pg. 414)
has achieved machine DOCUMENT 18
end of life and decommissioned (COLLY) [ non-
stated that permission letter was returnable gate
machine was vide dated pass dated
not in use since 02.07.2024 issued by 05.07.2024
many years and the appropriate Issued by
was disposed authority, further the Respondent No.1]
of as per PC- machine has been (Pg. 416)
PNDT has transferred to M/S
produced Calyx Infotech and
permission Services and
dated intimation regarding
02.07.2024 the same could also
intimation be evidenced vide
dated non-returnable gate
05.07.2024 pass dated
05.07.2024
Issued by the
itself.
12(e)@ Pg. 20: The Petitioner has DOCUMENT 18
Certificate of intimated the (COLLY)
Registration appropriate authority [Intimation letter
page 425 of the about the handing dated 03.07.2024]
present over of the said (Pg. 415)
petition reveals equipment to M/s
that the said Calyx Infotech
equipment was Services vide letter
delete d from dated 03.07.2024, the
the said delay in the deletion
certificate more certificate
than 10 months attributable to the
physically over administrating
after handing processing by the
over the said appropriate authority
equipment to which is beyond the
M/s Calyx control of the
Infotech Petitioner.
Services on
05.07.2024.
Siemens 13(a)-(e) @ Pg. The petitioner DOCUMENT 18
Heliophos- 21-23: The said regularly services the (COLLY)
D X-Ray equipment was equipment as and [intimation for
last serviced by when required, decommissioning
the supplier servicing of the said to the competent
Siemens on equipment has authority dt.
17.06.2021 and always been 14.08.2025] (Pg.
thereafter third conducted by an 395)
party namely AERB authorized DOCUMENT R-
M/s agency 1.e. M/s 12 [SERVICE
Healthline Bionation Imaging REPORT dt.
Engineers. pvt. Ltd., further, 15.06.2021 &
contractual there or is 17.06.2021] (Pg.
no statutory 229)
obligation upon the DOCUMENT P-6
Petitioner to get the [M/s Bionation
servicing of the AERB license]
equipment done only DOCUMENT 18
through the (COLLY) [Quality
manufacturer, these Assurance report
servicing have prepared by M/s
nothing to do with Bionation Imaging
the machine said Pvt. Ltd. Dt.
achieving end of life. 28.07.2025] (Pg.
Further the said 426)
servicing is with
regard through Mis
Bionation Imaging
Pvt. Ltd. could also
evidenced through
the QA report dated
25.07.2025 as
attached in the
petition @ pg. 426.
Allengers 14 @ Pg. 23-24 The information DOCUMENT R-
MAR S-40 The Petitioner about the 20.01.2026 14 [Email dt.
X-Rav on 20.01.2026 has communication 20.01.2026] (Pg.
requested been wrongfully 237)
Respondent misrepresented by DOCUMENT l
No. 1 to allow the Respondent as the 8(COLLY)
the Fujifilm same could be [AERB valid
Engineer for evidenced vide email License
maintenance of dt. 20.01.2026 as 14.08.2030] (Pg.
the Xray attached by the 397)
system. M/s Respondents as
Fujifilm are not DOCUMENT R-14
an approved @ 235, the
servicing communication
agency the clearly states that the
same is a said agency has been
statutory contacted for
violation essential functioning
and maintenance CR
system of X-ray
equipment and not
AERB related
servicing, this
statement has been
knowingly
misrepresented in
order to misled the
court.
GE Logiq 17 @ Pg. 26: There has been a DOCUMENT 18
E9 (S. No. The petitioner typographical error in (COLLY)
200230US5 claims that the the serial number of [intimation letter
) intimation for the machine in the dt. 08.06.2016]
installation of list attached in the (Pg. 418)
the said email dated
equipment is at 18.12.2025, further it
page 418 of the stated the correct
Petition, serial number of the
however, the machine is
machine 200230US5 and the
referred to in said machine has
that email is been installed at the
GE model Hospital premises
Logiq E9 serial vide letter dated
No. 1- 08.06.2016 and
5960363147 remains fully DOCUMENT 18
installed on functional and (COLLY) [PC-
31.05.2016 is currently in use at the PNDT
currently hospital. CERTIFICATE]
working at the The ultrasound (Pg. 425)
Respondent machine model
No.1 hospital. Logiq E9 bearing
There is no serial no. 200230US5
other is currently installed
ultrasound at the Hospital
machine model premises and the
Logiq E9 same is included in
shown in the the PC-PNDT
said list. certificate, further the
Further the PC- Respondent through
PNDT these confusing
certificate statements is trying
doesn't find to misled the Hon'ble
mentioning of Court.
the said
machine.
Sonoscape 18 @Pg. 27- The said machine DOCUMENT
P-20 29: Prior was installed at the (COLLY)
Doppler (S. intimation for hospital premises [Intimation letter
No. 916) installation was only after obtaining dt. 07.10.2024]
given on all the statutory (Pg. 417)
30.09.2024 and approvals and due
it was installed intimation was given
07.10.2024 to the appropriate
which shows authority of the said
the said change, the delay in
equipment was the addition of the
installed within said machine is
7 days of purely attributable to DOCUMENT P-2
intimation the administrative [letter dated
which is a clear processing by the 16.10.2012 along
violation of authority. with the attached
Rule 13 of the Moreover, the order (W.P. (C)
PC-PNDT Hon'ble Delhi High 4009 of 2012
Rules 30 days Court in W.P. (C) (Indian
advance notice 4009 of 2012 (Indian Radiological
Radiological and Imaging and
Imaging Association Association
(IRIA) Vs. Union of (IRIA) Vs. Union
India and Medical of India and
Council of India) Medical Council
held that condition of of India))]
an advance of 30
days as per Rule 13
of the PC-PNDT
Rules, 1996 is
onerous, and further
directed an
arrangement qua
Rule 13 to be made
wherein for every
change in place,
equipment and
address an advance
notice of seven days
be given to the
Appropriate
Authority and for
every change in
employee intimation
can be given within 7
days of such change.
The Court also held
that a delay on the
part of the
Appropriate
Authority in
incorporating the
change and re-issuing
the certificate would
not prevent the
concerned clinics
from effecting the
change in place
address of the
equipment after a
lapse of seven days
and to continue with
their activities.
GE Voluson 19 @Pg. 29- The petitioner had DOCUMENT 18
E8 Expert 30: The duly obtained the (COLLY)
(S. No. equipment was said equipment vide [Permission dated
D00527) registered two letter dt. 18.04.2022, 18.04.2022
months after further the same was intimation
the installation installed at the installation
which is in Hospital premises 26.04.2022] (Pg.
violation of only post the 423-424)
rule 18 (1) read installation
with rule 13 of intimation dt.
the PC-PNDT 26.04.2022, thus the
Rules Petitioner has
completed the due
compliance and only
after that installed the
said equipment. The
delay in the addition
of the said machine
in the PC-PNDT
certificate is purely
attributable to the
administrative
processing by the
authority and as per
Indian Radiological
and Imaging
Association (IRIA)
Vs. Union of India
and Medical
Council of India
(Supra) the same
would not prevent the
concerned clinics
from effecting the
change in place
address of the
equipment after a
lapse of seven days
and to continue with
their activities.
Mindray 21 @Pg. 31- The with petitioner DOCUMENT 18
M7 (S. No. 32: had obtained the (COLLY)
NW420037 The Petitioner permission for sale [Permission for
58) had obtained and transfer from the sale and transfer
the permission authority vide letter dt. 02.07.2024,
for sale and dated 02.07.2024, intimation for sale
transfer from intimation letter for and transfer dt.
the authority the sale and transfer 03.07.2024, Non-
vide letter of the said machine returnable gate
dated was sent on 05.07.2024 issued
02.07.2024, it 03.07.2024 and the by Respondent
was further non-returnable gate No.1] (Pg. 414-
sold to M/s pass was issued by 416)
Calyx Infotech the Respondent No.1
Services on on 05.07.2024, this
05.07.2024, the clearly shows that the
said equipment lawfully transferred
was deleted the said machine and
from the PC- not used it thereafter.
PNDT The delay in the
certificate on deletion of the said
22.05.2025 machine in the
which after PCPNDT certificate
more than 10 is purely attributable
months post to the administrative
the sale processing by the
authority and as per
Indian Radiological
and Imaging
Association (IRIA)
Vs. Union of India
and Medical
Council of India
(Supra) the same
would not prevent the
concerned clinics
from effecting the
change in place
address of the
equipment after a
lapse of seven days
and to continue
activities.
Philips 22 @Pg. 32- The petitioner had DOCUMENT 18
IU22 (S. 33: obtained the (COLLY)
No. The Petitioner permission for sale [Permission for
B05P8L) had obtained and transfer from the sale and transfer
the permission authority vide letter dt. 02.07.2024,
for sale and dated 02.07.2024, intimation for sale
transfer from intimation letter for and transfer dt.
the authority the sale and transfer 03.07.2024, Non-
vide letter of the said machine returnable pass dt.
dated was 03.07.2024 and gate 05.07.2024
02.07.2024, it the non-returnable issued by
was further gate pass was issued Respondent No.1]
sold to M/s by the Respondent (Pg. 414-416)
Calyx Infotech No.1 on 05.07.2024,
Services on this clearly shows
05.07.2024, the Respondent has
said equipment lawfully transferred
was deleted the said machine and
from the not used it thereafter.
PCPNDT The delay in the
certificate on deletion of the said
22.05.2025 machine in the PC-
which after PNDT certificate
more than 10 attributable is purely
months post to the administrative
the sale processing by the
authority and as per
Indian Radiological
and Imaging
Association (IRIA)
Vs. Union of India
and Medical
Council of India
(Supra) the same
would not prevent the
concerned clinics
from effecting the
change in place
address of the
equipment after a
lapse of seven days
and to continue
activities.
Sonoscape 23 @ Pg. 33- The petitioner had DOCUMENT 18
P-20 (S. No. 34: The said obtained the (COLLY)
295) equipment was permission for sale [Permission for
handed over to and transfer from the sale and transfer
M/s Sonoscape authority vide letter dt. 11 .12.2024,
Medical India dated 11.12.2024, intimation for sale
Pvt. Ltd. by the intimation letter for and transfer dt.
Petitioner vide the sale and transfer 13.12.2024, Non-
permission for of the said machine returnable pass dt.
sale and was sent on 13.12.2024 issued
transfer dt. 13.12.2024 and the by Respondent
11.12.2024, the non-returnable gate · No.1] (Pg. 419-
said equipment pass was issued by 421)
was deleted the Respondent No.l
from the PC- on 13.12.2024, this
PNDT clearly shows that the
certificate only Respondent has
on 22.05.2025, lawfully transferred
which is more the said machine and
than 5 months not used it thereafter.
after the The delay in the
permission for deletion of the said
sale and machine in the PC-
transfer was PNDT certificate is
obtained by the purely attributable to
Petitioner the administrative
which is a clear processing by the
violation of the authority and as per
PC-PNDT Indian Radiological
Rules. and Imaging
Association (IRIA)
Vs. Union of India
and Medical Council
of India (Supra) the
same would not
prevent the
concerned clinics
from effecting the
change in place
address of the
equipment after a
lapse of seven days
and to continue with
their activities.
41. This Court is of the opinion that, at this stage, while exercising
jurisdiction under Section 9 of the A&C Act and bearing in mind the
limited compass of such jurisdiction as noticed in the preceding
paragraphs, there arises no occasion to enter into these issues which
are purely on the merits of whether or not the Impugned Termination
Notice could have been issued.
42. In the aforesaid backdrop, this Court consciously refrains from
embarking upon a detailed examination of the merits of the various
allegations levelled by the parties, as such an inquiry would trench
upon issues that properly fall within the domain of the Arbitral
Tribunal. At this stage, it suffices to observe that, even assuming
disputes exist with respect to the functioning of the machines, as
contended by the Respondents, the resolution of such disputes must
strictly conform to the procedure contractually agreed between the
parties.
43. The Agreement, as between the parties, clearly stipulates, under
Clause 10, that in the event of an alleged material breach, a prior
notice is required to be issued specifying the breach complained of,
followed by a stipulated cure period of 45 days to enable rectification
or removal of such breach. Termination, therefore, is not an immediate
or unilateral remedy, but one conditioned upon compliance with the
agreed mechanism.
44. In the present case, even proceeding on an arguendo basis that
certain deficiencies existed in relation to the machines, the
Respondents were nonetheless bound to adhere to the termination
mechanism embodied in Clause 10 of the Agreement. The proper
course would have been to issue a notice identifying the alleged
material breach and affording the Petitioner the contractually
mandated opportunity to cure the same within the prescribed period. It
is only upon failure to rectify such breach within the stipulated time
that the right to issue a Termination Notice could have arisen.
45. As rightly contended by learned Senior Counsel for the
Petitioner, there could be no occasion for a unilateral determination by
the Respondents that the alleged defects were incurable, particularly in
the absence of compliance with the contractual cure mechanism. Such
a determination, without affording the Petitioner the agreed
opportunity to remedy the alleged breach, would be contrary to the
express terms of the Agreement.
46. In the considered opinion of this Court, the impugned act of
termination appears to have been effected in undue haste, placing the
cart before the horse, and is prima facie not in consonance with the
procedure and safeguards expressly incorporated in the Agreement.
47. Consequently, in view of the foregoing discussion and the
prima facie findings recorded hereinabove, this Court is of the
considered opinion that the relief sought by the Petitioner for staying
the operation and effect of the Impugned Termination Notice deserves
to be granted. The Respondents are, accordingly, directed to strictly
comply with and adhere to the terms and conditions of the Agreement,
including the procedure and safeguards expressly stipulated therein
with respect to termination.
48. At this interlocutory stage, the material placed on record prima
facie indicates a departure from, and non-adherence to, the termination
mechanism prescribed under Clause 10 of the Agreement. The
contractual requirement of issuance of notice specifying the alleged
material breach, coupled with the grant of a stipulated cure period,
does not appear to have been complied with in its true letter and spirit.
A prima facie case is thus made out, warranting the exercise of this
Court's jurisdiction under Section 9 of the A&C Act.
49. Further, if the Impugned Termination Notice is permitted to
operate during the pendency of the arbitral proceedings, if any, the
consequences to the Petitioner would be both immediate and far-
reaching. The Agreement in question admittedly subsists for a
substantial unexpired tenure of approximately five years, during which
the Petitioner is entitled to perform its contractual obligations and
derive the corresponding commercial benefits.
50. In the considered opinion of this Court, a premature termination
at this stage would effectively divest the Petitioner of these valuable
contractual rights without the disputes having been adjudicated on
merits by the Arbitral Tribunal. Such a course would not only disturb
the contractual equilibrium between the parties but may also render
the arbitral process itself illusory in practical terms, inasmuch as the
subject matter of the dispute would stand irreversibly altered before a
final determination is rendered.
51. The balance of convenience, therefore, clearly tilts in favour of
preserving the status quo and maintaining the contractual relationship
pending adjudication. If interim protection is declined, in view of the
foregoing discussions, and the termination is allowed to take effect,
the Petitioner would suffer consequences that may not be capable of
complete restitution even if it ultimately succeeds.
52. In addition to financial implications, the Petitioner has
demonstrated a credible apprehension of serious prejudice to its
reputation, goodwill, and commercial standing as a premier agency
engaged in the provision of diagnostic services. Such reputational
harm, once occasioned, is inherently intangible and cannot be
adequately measured or compensated in monetary terms. The element
of irreparable injury is thus clearly established, warranting protective
intervention at this stage.
DECISION:
53. In view of the aforesaid analysis and findings, the Impugned
Termination Notice is stayed. The parties are directed to maintain
status quo with respect to the operation, implementation, and
performance of the Agreement as it stood immediately prior to the
issuance of the said Termination Notice.
54. At this stage, it is clarified that nothing contained in this
Judgment shall be construed as an expression of any final opinion by
this Court on the merits of the disputes between the parties. The
observations made herein are confined solely to the adjudication of the
present Petition and shall not be understood as a determination of the
substantive issues.
55. Accordingly, all rights and contentions of both parties are kept
open and expressly reserved to be urged before the appropriate forum,
in accordance with law.
56. In view thereof, the present petition, along with the pending
application, stands disposed of in the aforesaid terms.
57. No orders as to cost.
HARISH VAIDYANATHAN SHANKAR, J.
FEBRUARY 26, 2026/tk/sm/her
