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Himachal Pradesh High Court · body

2014 DIGILAW 1384 (HP)

KGN Technologies v. Municipal Corporation

2014-10-09

TARLOK SINGH CHAUHAN

body2014
JUDGMENT Tarlok Singh Chauhan J. (Oral) The appellant/plaintiff by way of the present appeal has approached this Court for setting aside the order dated 2.8.2014 passed by the learned Additional District Judge, Shimla, whereby prayer of the appellant/plaintiff for grant of interim injunction has been declined. 2. The appellant is a firm engaged in the business of advertisement on digital medium including LED Screen Graphical displays and participated in the tender process and after being the highest bidder was declared successful. It is claimed that one of the conditions in the notice inviting tender was that the respondents would provide space for display of the LED screens at two locations, first near Ridge (hereinafter referred to as the ‘First Site’) and second near Indira Gandhi Sports Complex, The Mall, Shimla (hereinafter referred to as the ‘Second Site’). Pursuant to acceptance of bid amount, the appellant in furtherance of the terms and conditions of the notice executed an agreement with the respondents on 25.2.2009. It is further claimed that at the time of entering into agreement with the respondents, the officers of the respondents unilaterally altered the terms and conditions of the notice inviting tender and the second site was shifted below the Church, which was not at all feasible for installing LED screen. The plaintiff/appellant had quoted the rates after working out all the logistics, particularly the sites where the screens were required to be installed. Out of the income the plaintiff was to remit the rentals and other expenses. After execution of the agreement on 25.2.2009, both screens were inspected by the officials of the respondent Corporation and the first LED screen was installed on 27.2.2009, but the second LED screen could not be installed at the second site till date. It is claimed that both the screens cost the plaintiff a sum of Rs.38,00,000/- and the annual maintenance charges being paid by the plaintiff are to the tune of Rs.1,44,000/-. Because of the acts of the respondents, the plaintiff filed the suit claiming their in the following reliefs:- “(A) A Decree for a sum of Rs.28,00,000/- may be passed in favour of the plaintiff and as against defendants as damages for breach of contract/agreement dated 25.2.2009 along with interest @ 16% per annum. Because of the acts of the respondents, the plaintiff filed the suit claiming their in the following reliefs:- “(A) A Decree for a sum of Rs.28,00,000/- may be passed in favour of the plaintiff and as against defendants as damages for breach of contract/agreement dated 25.2.2009 along with interest @ 16% per annum. (B) A Decree for permanent prohibitory injunction may kindly be granted in favour of the plaintiff and against the defendants thereby restraining the defendant from taking forcible possession of the first site i.e. LED Screen setup on Takka Bench near Ridge and also further putting it to tender of allotting the same to some other person or concern and further tampering with the connections and setup and the electricity supply till the payment of compensation or till the time the plaintiff is able to earn the losses incurred due to breach of contract. (C) A Decree for Mandatory Injunction in the alternative thereby directing the defendant to extend the agreement for the first site for another five years.” Along with the suit an application for ad interim injunction was filed for restraining the respondents from forcibly taking possession of the first LED screen or interfering in the operation of the same. 3. The respondents filed reply, wherein preliminary objections regarding maintainability and estoppel were raised and on merits it was denied that the respondents had been threatening and pressurizing the appellant to leave the first site and handover the LED to the respondents and failing which forcible possession would be taken. It was further averred that in terms of the agreement arrived at between the parties, in order to recover the balance amount due from the appellant after the expiry of five years a notice was required to be served to pay the balance amount, which was served and yet the appellant avoided to pay the balance amount. 4. The learned trial Court vide a detailed judgment dismissed the application for grant of ad interim injunction, which order has been assailed by way of the present appeal on the ground that the same is against law and facts of the case and the learned trial Court failed to take into consideration the fact that till February, 2014 the respondents have failed to provide space for installation of the second LED at the second site and in this way the appellant has suffered huge financial losses. It is further alleged that the learned trial Court failed to appreciate the fact that the contract of agreement had in fact been violated by the respondents and not by the appellant and it is lastly contended that the leaned Court below has wrongly given weightage to the condition of tender that under the BOT scheme after five years the appellant was required to handover and transfer the LED to the respondents, without taking into consideration that it was the respondents who themselves have failed to comply with the condition and has not handed over the proper place for installation of second LED for the last five years. 5. I have heard the learned counsel for the parties and have gone through the records of the case. At the outset it may be observed that this Court while exercising appellate jurisdiction will not interfere with the exercise of discretion of the Court of first instance and substitute its own discretion except where the discretion has been show to have been exercised arbitrarily, or capriciously or perversely or where the Court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. This Court will not reassess the material and seek to reach a conclusion different from the one reached by the Court below if the one reached by the Court below was reasonably possible on the material. This proposition of law has been scantly set out by the Hon’ble Supreme Court in Skyline Education Institute (India) Private Limited Vs. S.L. Vaswani and another, (2010) 2 SCC 142 , wherein it was held as under:- “19. We have thoughtfully considered the entire matter. This proposition of law has been scantly set out by the Hon’ble Supreme Court in Skyline Education Institute (India) Private Limited Vs. S.L. Vaswani and another, (2010) 2 SCC 142 , wherein it was held as under:- “19. We have thoughtfully considered the entire matter. Before pronouncing upon the tenability or otherwise of the appellant’s prayer for restraining the respondents from using the word “Skyline” for the Institute of Engineering and Technology established by them, we consider it necessary to observe that as the suit filed by the appellant is pending trial and issues raised by the parties are yet to be decided, the High Court rightly considered and decided the appellant’s prayer for temporary injunction only on the basis of the undisputed facts and the material placed before the learned Single Judge and unless this Court comes to the conclusion that the discretion exercised by the High Court in refusing to entertain the appellant’s prayer for temporary injunction is vitiated by an error apparent or perversity and manifest injustice has been done to it, there will be no warrant for exercise of power under Article 136 of the Constitution. 20. In Wander Ltd. v. Antox India (P) Ltd., 1990 Supp SCC 727 this Court was called upon to determine the scope of appellate court’s power to interfere with the discretion exercised by the court of first instance in granting or refusing the prayer for temporary injunction. The facts of that case were that in the suit filed by it, respondent Antox India (P) Ltd. had prayed for restraining the appellant from using registered trade mark “Cal-De-Ce”. The leaned Single of the High Court refused to entertain the respondent’s prayer but on reconsideration of the matter the Division Bench passed an order of injunction. This Court reversed the order of the Division Bench and observed: (SCC P. 733, para 14) “14….In such appeals, the appellate court will not interfere with the exercise of discretion of the court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against exercise of discretion is said to be an appeal on principle. An appeal against exercise of discretion is said to be an appeal on principle. Appellate court will not reassess the material and seek to reach a conclusion different from the one reached by the court below if the one reached by that court was reasonably possible on the material. The appellate court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. If the discretion has been exercised by the trial court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify interference with the trial curt’s exercise of discretion.” 21. The proposition of law laid down in Wander Ltd. v. Antox India (P) Ltd. 1990 Supp SCC 727 was reiterated in N.R. Dongre v Whirlpool Corpn. (1996) 5 SCC 714 in which this Court considered the correctness of an order of temporary injunction passed by the learned Single Judge of the Delhi High Court in a suit filed by the respondents to restrain the defendants from manufacturing, selling, advertising or in any way using he trade mark “Whirlpool” or any other trade mark deceptively or confusingly similar to the trade mark “Whirlpool” in respect of their goods. The claim of the respondent-plaintiffs was based on prior user of the mark “Whirlpool”. After considering the rival pleadings and material placed before him, the learned Single Judge granted temporary injunction. The Division Bench confirmed that order and dismissed the appeal preferred by the appellant. This Court, declined to interfere with the discretion exercised by the learned Single Judge and Division Bench of the High Court and held: (N.R. Dongre case, (1996) 5 SCC 714 , SCC p. 727, para 18) “18. Injunction is a relief in equity and is based on equitable principles. On the above concurrent findings, the weight of equity as this stage is in favour of the plaintiffs and against the defendants. It has also to be borne in mind that a mark in the form of a word which is not a derivative of the product, points to the source of the product. The mark/name ‘WHIRLPOOL’ is associated for long, much prior to the defendant’s application in 1986 with the Whirlpool Corporation, Plaintiff 1. It has also to be borne in mind that a mark in the form of a word which is not a derivative of the product, points to the source of the product. The mark/name ‘WHIRLPOOL’ is associated for long, much prior to the defendant’s application in 1986 with the Whirlpool Corporation, Plaintiff 1. In view of the prior user of the mark by Plaintiff 1 and its trans-border reputation extending to India, the trade mark ‘WHIRLPOOL’ gives an indication of the origin of the goods as emanating from or relating to the Whirlpool Corporation, Plaintiff 1. The High Court has recorded its satisfaction that use of the ‘WHIRLPOOL’ mark by the defendants indicates prima facie an intention to pass off the defendants’ washing machines as those of the plaintiffs or at least the likelihood of the buyers being confused or misled into that belief.” A somewhat similar view was expressed in Cadila Health Care Ltd. V. Cadila Pharmaceuticals Ltd. (2001) 5 SCC 73 . 22. The ratio of the abovenoted judgments is that once the court of first instance exercises its discretion to grant or refuse to grant relief of temporary injunction and the said exercise of discretion is based upon objective consideration of the material placed before the court and is supported by cogent reasons, the appellate court will be loath to interfere simply because on a de novo consideration of the matter it is possible for the appellate court to form a different opinion on the issues of prima facie case, balance of convenience, irreparable injury and equity.” 6. Bearing in mind the aforesaid exposition of law, the claim of the appellant may be tested. In case the relief claimed in the suit (supra) is seen, it appears that the appellant has already claimed damages of Rs.28,00,000/- for breach of agreement on the ground that the respondents have failed to provide the second site for installation of the LED. In order to further safe guard its interest, the plaintiff has claimed a decree for permanent prohibitory injunction against the respondents, thereby restraining them from taking forcible possession of the first site and also further putting into tender or allotting the same to some other person or concern and other reliefs as quoted above. 7. To my mind relief No. (B) is totally misconceived and is not at all maintainable in the eyes of law. 7. To my mind relief No. (B) is totally misconceived and is not at all maintainable in the eyes of law. Once the plaintiff/appellant has claimed damages for breach of the agreement, further relief of interim injunction to the effect that even to first site where the LED has been installed should not be removed by the respondents, does not in fact flow out from the first relief. Even otherwise there is no substantive relief qua site No. 2, which is alleged to have not been provided to the appellant. The plaintiff cannot lay claim with respect to the first site which admittedly was provided to it and in terms of the agreement, it has already utilized the same for a period of five years and was required to handover the said screen back to the respondents as per terms and conditions of the agreement, more particularly conditions No. 1, 9, 12 and 12, which are reproduced below:- “(1) That the allotment of space by the First Party shall be on Built Operate and Transfer (B.O.T.) basis for five years to the bid amount Rs.21.75 Lacs (Rs. Twenty One Lacs and Seventy five thousand only) after that the Second Party will transfer both the LED SCREENS to M.C. Shimla in good running conditions. (9) That the Second party will maintain 15 street light near the Lift Parking for the contract period of 5 years and these light points shall be identified by the Municipal Corporation, Shimla. (12) That in case, of breach of any of the condition of the contract, the amount of earnest money deposited by the second party shall be forfeited and all the apparatus, machinery and equipments attached with the Screen at both the places shall also be confiscated alongwith LED SCREEN. (13) That the first party may terminate the contract by giving 30 days notice to the second party and termination can be for any reason in the public interest.” 8. As noticed above, the plaintiff/appellant has already claimed damages for the loss alleged to have sustained by it, therefore, the application for injunction, that too qua site No. 1 is not maintainable. This is all the more so when no substantive relief qua this site has been claimed and rightly so because admittedly there is no dispute regarding site No. 1 between the parties. This is all the more so when no substantive relief qua this site has been claimed and rightly so because admittedly there is no dispute regarding site No. 1 between the parties. The appellant has mischievously introduced site No. 1 in the suit as also in the application and in case the injunction as prayed for is granted, it would not only amount to undue enrichment of the plaintiff, but as noticed above, the same would be contrary to the contract/agreement entered into between the parties. In view of the aforesaid discussion, there is no merit in this appeal and the same is dismissed, leaving the parties to bear their costs.