2004 JTR(SC) 1331
2004 23 AIC 39 ; 2005 AIR(Jhar)(R) 153 ; 2005 AIR(SC) 104 ; 2004 AIR(SCW) 6333 ; 2005 1 AllCJ 562 ; 2004 57 AllLR 428 ; 2005 1 ApexCJ(SC) 457 ; 2004 4 AWC 3717 ; 2004 3 BLJR 2207 ; 2005 4 BomCR(SC) 408 ; 2005 1 CivCC 430 ; 2005 DNJ 347 ; 2005 1 JLJR(SC) 44 ; 2004 9 JT 216 ; 2005 23 LCD 298 ; 2005 1 MhLJ(SC) 1043 ; 2005 1 MPLJ 447 ; 2005 1 PLJR(SC) 94 ; 2005 1 PLR(SC) 399 ; 2004 4 RCR(Civ) 760 ; 2004 8 Scale 862 ; 2004 8 SCC 488 ; 2005 1 WBLR 201 ; 2005 1 WLC 223 ; 2004 KHC 1592 ; 2004 8 Supreme 199
2004(8) Supreme 199
SUPREME COURT OF INDIA
(From Punjab and Haryana High Court)
N. Santosh Hegde & S.B. Sinha, JJ.
Maharwal Khewaji Trust (Regd.), Faridkot -Appellant
versus
Baldev Dass -Respondent
Civil Appeal No. 6792 of 2004
(Arising out of SLP (C) No. 14972 of 2004)
Decided on 15-10-2004
Counsel for the Parties :
For the Appellant : R.S. Sachhar, Sr. Advocate, Mohit Chaudhary, Advocate for M/s K.L. Mehta and Co., Advocates.
For the Respondent : Anant Vijay Palli and Mrs. Rekha Palli, Advocates.
IMPORTANT POINT
Untill a case of irreparable loss or damage is made out by a party to the suit, Court should not permit nature of property being changed which also includes alienation.
Act Referred :CIVIL PROCEDURE CODE : O.39 R.1, O.39 R.2
(A) The Civil Procedure Code, Order 39, Rule 1 and Rule 2, govern the grant of interim injunctions and temporary injunctions in civil suits, enabling a court to preserve the status quo of the subject-matter pending adjudication. The present suit invoked these provisions to restrain alienation and construction on the property, and the trial court exercised its discretion to grant temporary injunction to maintain the existing position. The appellate and high court scrutiny centered on whether irreparable damage was established to justify intervention under these rules and the doctrine of lis pendens, which seeks to protect pending litigation from adverse changes in property status. Ultimately, the impugned orders were challenged for disregarding the trial courts protective stance and for allowing changes to the property without adequate legal justification during the pendency of the suit.
(B) The key legal principles include the doctrine of status quo preservation during litigation, the threshold requirement of prima facie irreparable loss for interim relief, the constraints imposed by lis pendens, and the limited scope for altering property rights while a suit is pending. The case also underscores that appellate and high courts must independently assess whether the prerequisites for disturbing the status quo are satisfied, and that mere hardship or delay in proceedings does not suffice to override the protection of the existing position.
Facts of the case:
The appellant filed a civil suit for possession of scheduled property and sought an injunction under Order 39 Rules 1 and 2 of the Civil Procedure Code to prevent the respondent from alienating or constructing on the property. The trial court granted temporary injunction. The respondent appealed, was allowed by the lower appellate court on the condition that any alienation would be subject to law and any construction would be at the respondents risk. A revision to the High Court was dismissed after an oral undertaking by the respondents counsel stating no intention to alienate, that construction would be at respondents risk, and that any induced tenant would be informed of the litigation. The High Court dismissed the revision without examining the grounds, prompting this appeal.
Findings of Court:
The court found that neither the lower appellate court nor the High Court justified permitting changes to the property status during litigation. It held that unless irreparable loss or damage is clearly demonstrated, courts should not permit changes to the property that could prejudice the ultimate success of the opposing party. The respondents contentions did not establish such exceptional circumstances, and the high courts failed to properly apply the principles of status quo and lis pendens.
Issues:
Whether interim relief under Order 39 Rules 1 and 2 CPC was properly granted and maintained. Whether the respondent could alter the property or alienate it during pendency of the suit without establishing irreparable damage. Whether the appellate and high courts correctly applied the doctrine of lis pendens and the principle of preserving the status quo.
Ratio Decidendi:
During pendency of a suit, courts must preserve the status quo unless a party demonstrates irreparable loss or damage. Alteration or alienation of property pending adjudication is impermissible absent exceptional circumstances. The appellate and high courts erred in not independently assessing this threshold and in allowing changes to the property based on insufficient justification.
Result:
The appeal is allowed. The impugned orders of the appellate and high courts are set aside. The order of the trial court restraining alienation and construction is restored.
(A) The Civil Procedure Code, Order 39, Rule 1 and Rule 2, govern the grant of interim injunctions and temporary injunctions in civil suits, enabling a court to preserve the status quo of the subject-matter pending adjudication. The present suit invoked these provisions to restrain alienation and construction on the property, and the trial court exercised its discretion to grant temporary injunction to maintain the existing position. The appellate and high court scrutiny centered on whether irreparable damage was established to justify intervention under these rules and the doctrine of lis pendens, which seeks to protect pending litigation from adverse changes in property status. Ultimately, the impugned orders were challenged for disregarding the trial courts protective stance and for allowing changes to the property without adequate legal justification during the pendency of the suit.
(B) The key legal principles include the doctrine of status quo preservation during litigation, the threshold requirement of prima facie irreparable loss for interim relief, the constraints imposed by lis pendens, and the limited scope for altering property rights while a suit is pending. The case also underscores that appellate and high courts must independently assess whether the prerequisites for disturbing the status quo are satisfied, and that mere hardship or delay in proceedings does not suffice to override the protection of the existing position.
Facts of the case:
The appellant filed a civil suit for possession of scheduled property and sought an injunction under Order 39 Rules 1 and 2 of the Civil Procedure Code to prevent the respondent from alienating or constructing on the property. The trial court granted temporary injunction. The respondent appealed, was allowed by the lower appellate court on the condition that any alienation would be subject to law and any construction would be at the respondents risk. A revision to the High Court was dismissed after an oral undertaking by the respondents counsel stating no intention to alienate, that construction would be at respondents risk, and that any induced tenant would be informed of the litigation. The High Court dismissed the revision without examining the grounds, prompting this appeal.
Findings of Court:
The court found that neither the lower appellate court nor the High Court justified permitting changes to the property status during litigation. It held that unless irreparable loss or damage is clearly demonstrated, courts should not permit changes to the property that could prejudice the ultimate success of the opposing party. The respondents contentions did not establish such exceptional circumstances, and the high courts failed to properly apply the principles of status quo and lis pendens.
Issues:
Whether interim relief under Order 39 Rules 1 and 2 CPC was properly granted and maintained. Whether the respondent could alter the property or alienate it during pendency of the suit without establishing irreparable damage. Whether the appellate and high courts correctly applied the doctrine of lis pendens and the principle of preserving the status quo.
Ratio Decidendi:
During pendency of a suit, courts must preserve the status quo unless a party demonstrates irreparable loss or damage. Alteration or alienation of property pending adjudication is impermissible absent exceptional circumstances. The appellate and high courts erred in not independently assessing this threshold and in allowing changes to the property based on insufficient justification.
Result:
The appeal is allowed. The impugned orders of the appellate and high courts are set aside. The order of the trial court restraining alienation and construction is restored.
JUDGMENT
Santosh Hegde, J.-Heard learned counsel for the parties.
Leave granted.
2. The appellant had filed a Civil Suit No. 541 of 2000 for possession of the suit scheduled property with an application under Order 39 Rules 1 and 2 CPC, seeking injunction restraining the respondent herein from alienating the suit property and putting up any construction thereon. The trial court on the interim application filed by the appellant granted an order of temporary injunction, as prayed for.
3. The appeal filed by the respondent herein before the learned District Judge came to be allowed holding that alienation made, if any, will be subject to the law of lis pendens and constructions, if any, put by the respondent will have to be removed at his own risk and cost in the event of the suit being decreed.
4. A revision filed against the said order of the High Court came to be dismissed by the impugned order wherein the High Court recorded an oral undertaking given by the learned counsel which is as follows:
Learned counsel for the respondent, on instruction from Rajinder Dass son of Baldev Dass, on the other hand, has stated that the respondent has no intention of alienating any part of the property and further that the defendant shall raise construction if any at his own risk costs without claiming any compensation. It is further stated that if the defendant inducts any tenant in any such premises so constructed, the person inducted would be made aware of the pendency of the litigation and would be bound by the judgment and decree passed in the suit."
5. It is in view of the above statement made by the learned counsel for the respondent that the High Court without considering the grounds raised in the revision petition proceeded to dismiss the petition.
6. Mr. R.S. Sachhar, learned senior counsel appearing for the appellant, contended that generally during the pendency of litigation courts protect the status quo existing on the date of the suit and it is only in exceptional circumstances where irreparable damage is feared, the courts permit change of status quo. His further contention was that in the present case no such case is made out by the respondent and the trial court was justified in protecting the status quo as on the date of the suit.
7. Mr. A.V. Palli, learned counsel for the respondent, contended that both the lower appellate court and the High Court were justified in making the impugned order because the appellant has not established any prima facie case and if the suit property is to be allowed to remain in the present condition, the respondent will be put to great hardship and an irreparable loss.
8. While it is true that the lower appellate court did go into the question of prima facie case and held that the appellant had not made out any such case, the High Court did not go into that question at all.
9. Be that as it may, Mr. Sachhar is right in contending that unless and untill a case of irreparable loss or damage is made out by a party to the suit, the court should not permit the nature of the property being changed which also includes alienation or transfer of the property which may lead to loss or damage being caused to the party who may ultimately succeed and may further lead to multiplicity of proceedings. In the instant case no such case of irreparable loss is made out except contending that the legal proceedings are likely to take a long time, therefore, the respondent should be permitted to put the scheduled property to better use. We do not think in the facts and circumstances of this case, the lower appellate court and the High Court were justified in permitting the respondent to change the nature of property by putting up construction as also by permitting the alienation of the property, whatever may be the condition on which the same is done. In the event of the appellant s claim being found baseless ultimately, it is always open to the respondent to claim damages, or, in an appropriate case, the court may itself award damages for the loss suffered, if any in this regard. Since the facts of this case do not make out any extraordinary ground for permitting the respondent to put up construction and alienate the same, we think both the courts below, namely, the lower appellate court and the High Court erred in making the impugned orders. The said orders are set aside and the order of the trial court is restored.
10. The appeal is allowed.
Appeal allowed.
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