- Case
- ASHOK INVESTORS TRUST LTD v. CHEERFUL TRADE AND REALTY DEVELOPERS PVT LTD (Bombay High Court, 06-03-2025)
- Law
- Commercial Courts Act, Code of Civil Procedure, Constitution of India.
Facts: Ashok Investors Trust Ltd. and DBS Bank India Ltd. filed commercial appeals against an order dated 5th June 2023, which made absolute an ad-interim injunction granted on 26th October 2021 in favor of Cheerful Trade & Realty Developers Pvt. Ltd. and Aristo Realty Developers Ltd. The dispute concerns pledged shares, with the plaintiffs claiming there was no valid pledge and seeking their return. The defendant, Lakshmi Vilas Bank (later merged with DBS Bank), initiated the sale of pledged shares after the borrower was declared a non-performing asset. The plaintiffs sought injunctions to restrain the sale and to direct deposit of proceeds.
Procedural Posture: The appellants challenged the Single Judge's order in Commercial Appeals under Section 13(1-A) of the Commercial Courts Act, 2015. The Single Judge had granted an ad-interim injunction restraining the defendants from dealing with the pledged shares, which the appellants contested.
Issue: Did the delay of over a year in passing the impugned order on the interlocutory application cause prejudice to the appellants, warranting the order to be set aside?
Holding: Yes, the delay of more than a year in pronouncing the order on the interlocutory application caused prejudice to the appellants, and the impugned order dated 5th June 2023 was quashed and set aside.
Reasoning: The Court found that the Single Judge did not adequately consider the essential ingredients for granting a temporary injunction, such as prima facie case, balance of convenience, and irreparable injury. Citing Supreme Court precedents like Anil Rai Vs. State of Bihar and Balaji Baliram Mupade & Anr., the court emphasized the importance of promptness in delivering judgments to maintain public confidence in the judicial system. The court noted that a delay in delivery of judgment deprives an aggrieved person of an opportunity to approach the higher forum. While mere delay is not sufficient to set aside an order, the court found that the delay in this case prejudiced the appellants. The court directed the Single Judge to reconsider the application for temporary injunction within six weeks, refraining from expressing any opinion on the merits of the matter.
