Nagar Palika Parishad Nainital vs M/S Sachin Kumar Contractor
2022 Latest Caselaw 1262 UK

        IN THE HIGH COURT OF UTTARAKHAND
                   AT NAINITAL

                Appeal from Order No. 119 of 2022

Nagar Palika Parishad Nainital                     ..... Appellant

                                   Versus

M/s Sachin Kumar Contractor                        .....Respondent

Present:
      Mr. D.S. Patni, the learned Senior Advocate assisted by Mr.
      Mahendra Singh Rawat, the learned counsel for the appellant.
      Mr. Aditya Pratap Singh, the learned counsel for the respondent.

                     Date of hearing : 21.04.2022

Coram:        Sri S.K. Mishra, ACJ.
              Sri R.C. Khulbe, J.

Upon hearing the learned counsel for the parties, this Court made the following judgment: (Per: Sri S.K.Mishra, ACJ.)

In this appeal, under Section 13 of the Commercial Courts Act read with Section 37(1)(b) of the Arbitration and Conciliation Act, 1996, the Nagar Palika Parishad, Nainital has assailed the ex-parte interim order passed by the Additional District Judge (Commercial) Dehradun, on 29.03.2022, passing ex- parte injunction not to terminate the contract of the respondent till next three months subject to deposit a bank guarantee of Rs. 28 lakhs.

2. The facts of the case in short is that, on 14.10.2020, the respondent was granted the contract of operating the parking area in the city of Nainital from 13.10.2020 to 31.03.2022 for a license fee of Rs. 1,68,00,000/-. Because of the covid-19 pandemic and circumstances beyond the control, the Nagar Palika Parishad, Nainital as per the Resolution dated

04.12.2021 extended contract with the respondent as well as other contractor for three months. The respondent, who was the petitioner before the learned Additional District Judge (Commercial) Dehradun, has deposited Rs. 42 lakhs as old arrears. The respondent again made an application on 22.03.2022 to extend the contract by another three months. By the Resolution dated 25.03.2022, the Nagar Palika Parishad, Nainital resolved to increase the license fee by 20% of the previous year and to extend the contract for the financial year 2022-23 and the respondent was sent a notice for his consent. However, the respondent represented that because of Covid-19 pandemic, he has sustained heavy loss, the respondent did not agree and then he invoked arbitration clause of the contract on 28.03.2022. Thereafter, he filed an application under Section 9 of the Arbitration and Conciliation Act before the learned Additional District Judge (Commercial), Dehradun and prayed for temporary injunctions. The case was taken up and ex-parte injunction was granted. The reason that has been given for granting ex-parte injunction is reflected at paragraph 5 of the judgment impugned. Hence, we consider it appropriate to quote the exact order passed by the learned Additional District Judge (Commercial) Dehradun, which reads as follows:-

"5. i=koyh ds voyksdu o ;kph ds dFkuksa ls ;g Li"V gS fd foi{kh fnukad 04-12-2021 ds fofu"p; }kjk rhu ekg iqu% ;kph dks izsf"kr i= fnukad 25-03-2022 }kjk foRrh; o"kZ 2022&23 dh lEiw.kZ vo/kh ds fy, iwoZ lafonk dks foLrkfjr djus ds fy, rS;kj gSA

;kph dk dFku gS fd fnukad 04-12-2021 ds fofu'p; esa fcuk fdlh Hkqxrku ds lafonk foLrkfjr djus dk dFku fd;k x;k Fkk] rkfd {kfr dh HkjikbZ gks lds] tcfd fnukad 25-03-2022 ds i= esa mDr vof/k ds fy, Hkh /kujkf"k dh ekax dh x;h gSA mHk;i{k ds fookn dk vfUre fuLrkj.k e/;LFk }kjk gh fd;k tk ldrk gSA ;kph dk dFku gS fd fnukad 31-03-2022 dks foi{kh }kjk Bsdk lekIr dj dCtk ys fy;k tk;sxkA ,slh fLFkfr esa mls viw.khZ; {kfr lEHkkfor gSA foi{kh Lo;a ;kph dk Bsdk foLrkfjr djus ds fy, mRlqd gSA ,slh fLFkfr esa lqfo/kk dk lUrqyu Hkh ;kph ds i{k esa gS rFkk ;kph dk izFke n`f"V;k dsl Hkh foi{kh ds fnukad 04-12- 2021 ds fofu"p; ds n`f"Vxr lkfcr gksrk gSA ;kph ds i{k esa vkns'k ikfjr fd;s tkus dh n'kk esa foi{kh ds vkfFkZd fgrksa dh {kfr laHko u gks bl gsrq ;kph us rhu ekg dh iwoZ fufonk ds vuqlkj vkxf.kr /kujkf'k dh security izLrqr djus dk Hkh dFku fd;k x;k gSA"

3. From the above, it is clear that the learned Additional District Judge (Commercial) Dehradun, has not applied his mind as to the requirement of granting an injunction without issuing notice to the opposite party, respondent before him. We take note of Order XXXIX Rule 3 of the Code of Civil Procedure, 1908 (hereinafter referred to as the Code for brevity). It reads as follows:-

3. Before granting injunction, Court to direct notice to opposite party. The Court shall in all case, 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 given 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-

(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.]

[3-A. Court to dispose of application for injunction within thirty days.-Where an injunction has been granted without giving notice to the opposite party, the Court shall make an endeavour to finally dispose of the application within thirty days from the date on which the injunction was granted; and where it is unable so to do, it shall record its reasons for such inability.]

4. Thus, it is clear that before passing any order of injunction the Court is required to direct notice to be served to the opposite party. However, the proviso provides that where it is proposed to grant 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 to deliver to the opposite party or send through a registered post, immediately after the order granting injunction has been passed (a) a copy of application along with a copy of the affidavit (b) copy of the plaint, and (c) copies of the documents. He is also required to file on which day such injunction is granted or on the day immediately following that day, an affidavit stating that the copies of the aforesaid have been delivered or sent.

5. Now considering this aforesaid provision, it is clear that the learned Additional District Judge (Commercial) Dehradun, has not applied his mind before granting an injunction ex-parte. He is under the duty to record the reasons for his opinion that the object of granting the injunction would be defeated by the delay in sending the notice. This aspect is singularly absent in the order impugned which makes it vulnerable. Secondly, the learned Additional District Judge (Commercial) Dehradun should have also directed the petitioner to deliver the copy of the application, affidavit, plaint and the documents within 24 hours of passing of the injunction order. That has not been done.

6. We are of the view that the order passed by the learned Additional District Judge (Commercial) Dehradun, is liable to be set aside, and, is therefore, set aside. The appeal is allowed. However, as the matter involves serious question of a contract and may effect movement of tourists in the city of Nainital because of the problem which may arise out of the parking of the vehicle near the lake, we direct that till 25.04.2022 status quo will be maintained by both the parties. We further direct that both the parties will appear before the learned Additional District Judge (Commercial) Dehradun on 25.04.2021 and shall produce certified copy of this order. On such an event, the matter shall be re-heard and appropriate order shall be passed. In the meantime, Nagar Palika Parishad, Nainital is also at liberty to file their written counter

/counter affidavit before the learned Additional District Judge (Commercial) Dehradun.

7. Let a certified copy of this order be provided as per rules within 24 hours.

(Ramesh Chandra Khulbe, J.) (Sanjaya Kumar Mishra, ACJ.)

PV