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Injunction in CPC
An injunction is a legal remedy granted by a court that requires a party to either refrain from doing a specific act (prohibitory injunction) or to perform a particular action (mandatory injunction).
It is an order directed at a specific individual, compelling them to either stop or start a particular behaviour or activity. This judicial process aims to prevent harm or injustice, maintain the status quo, or enforce specific rights or obligations.
The primary purpose of granting interim relief, such as temporary injunctions, is to preserve the property or status quo that is in dispute until the legal rights and conflicting claims of the parties involved can be fully adjudicated.
This involves finding a practical solution that considers the demands of the situation, balancing the potential harm or prejudice to both the plaintiff and the defendant.
The court aims to maintain the status quo at the time of initiating legal proceedings to prevent any changes until a final decision is made. This protective relief is granted to prevent potential future harm to either party.
However, the court must also consider the defendant's need for protection against any injury that may result from exercising their own legal rights.
In exercising its discretionary power, the court weighs these competing needs and determines where the balance of convenience lies, ultimately making a decision that it deems appropriate under the circumstances.
Types of Injunctions
Injunctions come in various forms, primarily classified as temporary and permanent. A permanent injunction, also known as a perpetual injunction, prohibits a party from a specified act indefinitely.
It can only be granted at the conclusion of a trial after hearing both parties and is governed by Sections 38 to 42 of the Specific Relief Act, 1963.
On the other hand, a temporary or interim injunction restrains a party temporarily from a specified act. It can be granted until the disposal of the suit or until further orders of the court.
Temporary injunctions are regulated by the provisions of Order 39 of the Code of Civil Procedure, 1908, and may be granted at any stage of the suit.
Injunctions can further be classified as preventive, prohibitive, or restrictive, which prevent, prohibit, or restrain someone from doing something, or mandatory, which compels or orders someone to do something.
Additionally, injunctions may be ad interim or interim. An ad-interim injunction is granted without finally deciding on an application for injunction and remains in effect until the disposal of the application.
An interim injunction is typically granted while finally deciding the main application and remains in effect until the disposal of the suit.
Grounds for granting Temporary Injunction (Order XXXIX, Rule 1-2)
Temporary injunctions may be granted by a court in various circumstances:
(a) When any property in dispute in a suit is at risk of being wasted, damaged, or alienated by any party to the suit, or wrongfully sold in execution of a decree.
(b) When a defendant threatens or intends to remove or dispose of their property with the intention of defrauding their creditors.
(c) When a defendant threatens to dispossess the plaintiff or otherwise cause injury to the plaintiff concerning any property in dispute in the suit.
(d) When a defendant is on the verge of committing a breach of contract or any other kind of injury.
(e) When the court deems it necessary in the interest of justice.
Principles
The authority to issue a temporary injunction rests within the court's discretion. However, this discretion must be exercised with prudence, reasonableness, and grounded in sound legal principles.
Injunctions should not be granted lightly as they can adversely impact the opposing party.
The granting of an injunction is a form of equitable remedy, and the court unquestionably possesses the power to stipulate suitable terms and conditions.
Nonetheless, these conditions must be fair to prevent rendering compliance practically impossible and thereby depriving the party of the relief they would otherwise be entitled to.
Typically, before granting an injunction, the court must be convinced of the following factors:
Prima Facie Case
The primary rule dictates that the applicant must establish a prima facie case in support of the claimed right. The court needs to be convinced that the applicant has raised a bona fide dispute, presenting an arguable case for trial necessitating further investigation and a decision on its merits.
Moreover, there must be a likelihood, based on the facts presented, that the applicant is entitled to the relief sought. The existence of a prima facie right and its infringement is a prerequisite for the granting of a temporary injunction.
The onus rests on the plaintiff to convince the court either by presenting evidence or elucidating the meaning and scope of a "prima facie" case, thereby demonstrating its favorability.
In Martin Burn Ltd. v. R.N. Banerjee, the Supreme Court remarked:
"A prima facie case does not imply a case proven beyond doubt, but rather one that could be considered established if the evidence supporting it were accepted.
When assessing whether a prima facie case has been established, the relevant consideration is whether, based on the evidence presented, it was feasible to arrive at the conclusion in question, rather than whether it was the sole conclusion possible based on that evidence.
While the tribunal assessing this matter may have reached a different conclusion, it should not substitute its judgement for the judgement under consideration. It only needs to determine if the view taken is a plausible one based on the evidence on the record."
However, a prima facie case should not be equated with a case proven beyond doubt. At this stage, the court is not tasked with resolving conflicts in evidence or deciding complex factual and legal issues that require extensive arguments and thorough consideration.
These matters are to be addressed during the trial. Therefore, the court should refrain from closely scrutinising the merits of the case at this preliminary stage, as it is not expected to render a final judgement.
In determining a prima facie case, the court should rely on the plaintiff's assertions as outlined in the complaint, affidavits, or other submitted materials.
Establishing a prima facie case must precede the issuance of an injunction. Only after a prima facie case has been established will the court consider other factors.
Failure to prove a prima facie case renders the applicant ineligible for a temporary injunction.
Irreparable Injury
The mere presence of a prima facie case does not automatically entitle the applicant to a temporary injunction.
Additionally, the applicant must satisfy the court regarding the second condition by demonstrating that they will suffer irreparable injury if the requested injunction is not granted and that no other remedy is available to shield them from the repercussions of such denial.
Refusal to grant the injunction would result in "irreparable injury" to the seeking party, necessitating protection from the anticipated harm.
The granting of an injunction constitutes an equitable remedy, exercisable only when judicial intervention is imperative to prevent anticipated harm and safeguard the rights and interests of the applicant.
In the landmark case of American Cyanamid Co. v. Ethicon Ltd., the House of Lords elucidated the principle as follows:
"The guiding principle is that the court should first assess whether, if the plaintiff were to prevail at trial in establishing their entitlement to a permanent injunction, they would be adequately compensated through damages for the losses incurred due to the defendant's continued actions that were subject to injunction from the time of application until trial.
If damages awarded under common law would suffice and the defendant is financially capable of paying, an interlocutory injunction should generally not be granted, regardless of the apparent strength of the plaintiff's claim at that stage.
Conversely, if damages would not constitute sufficient remedy for the plaintiff upon prevailing at trial, the court should then examine whether, in the opposite scenario where the defendant prevails at trial in establishing their right to the enjoined actions, they would be fairly compensated under the plaintiff's undertaking regarding damages for the losses incurred by refraining from such actions between application and trial.
If damages under such an undertaking would suffice and the plaintiff is financially capable, there would be no grounds to deny an interlocutory injunction on this basis."
However, the term "irreparable injury" does not imply that the injury cannot be repaired at all. Rather, it signifies that the injury must be significant, such that it cannot be adequately compensated through damages.
An injury is deemed irreparable when there are no specific or fixed monetary standards available for assessing damages.
Balance of Convenience
The third prerequisite for granting an interim injunction is that the balance of convenience must favour the applicant.
Put differently, the court must ascertain whether the potential harm, hardship, or inconvenience to the applicant resulting from refusing the injunction outweighs that which would be inflicted on the opposing party by granting it.
In exercising discretion regarding the grant or denial of injunction, the court should employ sound judicial discretion.
It must endeavour to evaluate the significant harm or injury likely to befall the parties if the injunction is refused and compare it with the potential harm to the opposing party if the injunction is granted.
After weighing conflicting probabilities, if the court deems that the balance of convenience favours the applicant, it will grant the injunction; otherwise, it will refuse it.
Once again, to cite the insightful remarks of Lord Diplock in American Cyanamid Co. v. Ethicon Ltd.:
"The purpose of the interlocutory injunction is to shield the plaintiff from harm caused by the violation of their rights, which cannot be adequately compensated through damages recoverable in the action if the uncertainty is resolved in their favour at trial.
However, the plaintiff's need for protection must be balanced against the corresponding need of the defendant to be shielded from harm resulting from being prevented from exercising their legal rights, for which they cannot be adequately compensated under the plaintiff's undertaking in damages if the uncertainty is resolved in the defendant's favour at trial.
The court must weigh one need against the other and determine where the balance of convenience lies." (emphasis added)
While English and Indian courts have commonly used the phrase "balance of convenience," it is argued that the more appropriate term should be "balance of inconvenience."
It is contended that once the plaintiff establishes a prima facie case, the court will deliberate on whether to grant or refuse the interim injunction. Inevitably, inconvenience will be caused to one of the parties involved.
Therefore, it is the duty of the court to weigh the inconvenience to the plaintiff against that of the defendant. If the court concludes that refusing the interim injunction would cause more or greater inconvenience to the plaintiff, it will grant the injunction.
Conversely, if granting the interim injunction would result in greater inconvenience to the defendant, the relief will be denied. It is through the consideration of comparative inconvenience that the court will exercise its discretion.
Ex-parte Injunction
Rule 3 of Order 39 stipulates that the applicant must serve notice to the opposing party before an injunction is granted. While the court retains the authority to issue an ex parte injunction without prior notice or a hearing for the affected party, such power should be exercised cautiously and only in exceptional circumstances.
In Morgan Stanley Mutual Fund v. Kartick Das, the Supreme Court outlined the factors to be considered by a court when contemplating the grant of an ex parte injunction:
(i) Whether irreparable or serious harm would befall the plaintiff;
(ii) Whether the denial of an ex parte injunction would result in greater injustice than its grant;
(iii) The timing of the plaintiff's awareness of the alleged act, as this may affect the court's decision;
(iv) Whether the plaintiff had acquiesced to the situation for a period, in which case an ex parte injunction may not be granted;
(v) The applicant's demonstration of utmost good faith in the application process;
(vi) Even if granted, the ex parte injunction should have a limited duration; and
(vii) The court should consider general principles such as prima facie case and balance of convenience, along with the potential for irreparable loss.
These considerations guide the court in determining whether to grant an ex parte injunction, ensuring fairness and equity in the legal process.
Mandatory Injunction
In specific circumstances, a court may issue a temporary mandatory injunction, but this relief is reserved for exceptional and compelling situations where the alleged harm is immediate and likely to cause significant prejudice to the applicant, which cannot be remedied through monetary compensation.
In essence, a temporary mandatory injunction at an interim stage is granted only in the rarest of cases. (See Dorab Cawasji Warden v. Coomi Sorab Warden, (1990) 2 SCC 117) Such relief necessitates a higher level of satisfaction, surpassing that required for a prohibitory injunction.
Moreover, a temporary mandatory injunction is granted solely to restore the status quo and not to establish a new state of affairs. (See Kishore Kumar Khaitan v. Praveen Kuar Singh, (2006) 3 SCC 312).