Royal Enterprises through Proprietor Bhanwar Singh Chaudhary v. Samuhik Chikitsalay Sangh, through Superintendent Jawahar Lal Nehru Hospital Ajmer
2016-10-07
ALOK SHARMA
body2016
DigiLaw.ai
ORDER : Mr. Alok Sharma, J. Heard and perused the impugned order dated 6-1-2016 passed by the Additional District Judge No. 2 Ajmer dismissing the appellant-applicant's (hereinafter 'the applicant's) application under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter 'the Act of 1996') 2. The applicant was awarded a contract on 16-6-2015 for supply of man power to the non-applicant Samuhik Chikitsalaya Sangh Superintendent Jawahar Lal Nehru Hospital, Ajmer (hereinafter 'the Sangh'). The contract provided under clause 47 for an arbitration of disputes arising therefrom between the contracting parties. The Sangh vide communication dated 10-11-2015 terminated the contract. The applicant resorting to clause 47 of the contract dated 16-6-2015 moved an application under Section 9 of the Act of 1996 seeking injunction against the aforesaid order dated 10-11-2015. That was dismissed by the impugned order dated 6-1-2016 by the trial court on a finding that no prima facie case was made out for the applicant, nor balance of convenience obtained in its favour. Resultantly the issue of irreparable loss to the applicant from the order dated 10-11-2015 was redundant. Hence this appeal. 3. Counsel for appellant has submitted that the court below has dismissed the application under Section 9 of the Act of 1996 by reason of a misdirection in law inter alia for the applicant not having impleaded the State Government as a party to the application nor having at the relevant time taken steps for invoking arbitration proceedings in terms of the clause 47 of the agreement dated 16-6-2015. It has been submitted that steps for arbitration proceedings qua the disputes inter alia arising from the termination dated 10-11-2015 have since been taken on 22-9-2015 by resorting to Section 11 of the Act of 1996 by an application before the Hon'ble Chief Justice of this Court on failure of the respondents, despite the notice dated 2-9-2015 to appoint an arbitrator and refer the disputes arising under the contract dated 16-6-2015 to him. It was further submitted that the trial court failed to take into consideration the facts before it wherefrom it was evident that no breach of contract could be attributable to the applicant and hence the termination of contract on 10-11-2015 was wholly arbitrary and malafide. 4. Mr.
It was further submitted that the trial court failed to take into consideration the facts before it wherefrom it was evident that no breach of contract could be attributable to the applicant and hence the termination of contract on 10-11-2015 was wholly arbitrary and malafide. 4. Mr. Sanjay Sharma, counsel for respondents has supported the impugned order dated 6-1-2016 passed by the trial court and submitted that the applicant was in breach of his obligation under the contract dated 16-6-2015 on multiple counts as recorded by the court below based whereon no prima facie case nor balance of convenience was made out in favour of the applicant. 5. Heard. Considered. 6. Section 14 of the Specific Relief Act, 1963 inter alia provides that a contract for the non performance of which compensation is wholly adequate relief cannot be enforced. An injunction sought against a letter of termination of contract for supply of manpower evidently seeks relief prohibited in law. Whatever be the merits of the applicant's case no injunction could in law have been granted in view of the prohibition of Section 14 of the Act of 1963. An injunction can be granted in matters of contract only in situations where there is no measure of damages which can be ascertained in appropriate proceedings. A contract for supply of manpower can by no stretch of imagination be one covered under Section 10 of the Act of 1963. Nor in fact it was so argued. Whatever the merit or demerit of the order of termination of contract dated 10-11-2015 whereby breach of contract at the instance of the applicant is alleged by the non-applicant, the applicant had no case for grant of injunction. If finally the order dated 10-11-2015 passed by the non applicant is held to be unwarranted in the course of arbitration proceedings or otherwise and recession of the contract by the Sangh held unjustified, the Sangh itself would be held in breach entitling the applicant to damages for breach of contract. It is well settled that a contracting party has, so to say, "the right" to terminate a contract, even in breach of conditions thereof and to pay damages therefor.
It is well settled that a contracting party has, so to say, "the right" to terminate a contract, even in breach of conditions thereof and to pay damages therefor. Further for the reasons set out in the order dated 10-11-2015 for terminating the contract it cannot be prima facie discounted at this stage that the respondent Sangh did not have a reasonable cause for termination of the contract. Be as it may, it is made clear that the merit of the order of termination dated 10-11-2015 however would be subject to the appropriate trail in the course of arbitration proceedings if the arbitration clause invoked by the applicant under Section 11 of the Act of 1996 proceedings sustains or otherwise in the course of a regular trial by the competent court. 7. In the circumstances, I find no force in the miscellaneous appeal. It is dismissed.