M/s. Raja Holdings vs S. Rajinikanth and R. Meenakshi

C.S. Karnan, J.—The appellant herein/plaintiff has filed original suit in O.S. No. 51 of 2013, on the file of Principal District Judge,

Thanjavur, against the respondents/defendants, stating that the defendants 1 and 2 borrowed a sum of Rs. 2,99,40,000/- from the

plaintiff/appellant herein and agreeing to repay the same with interest at the rate of 36% annum. The said amount had not been repaid by the

defendants. Hence, the suit has been filed for recovery of money against the defendants. The plaintiff sought an interim order of injunction

restraining the defendants 3 and 4, viz., S. Rajinikanth and R. Meenakshi not to alienate the properties described in the accompanying petition till

the disposal of the suit and also pass an ex-parte order of ad-interim injunction to the like effect to the disposal of the petition.

The third defendant, viz., S. Rajinikanth had filed a counter statement and resisted in the interlocutory application in I.A. No. 87 of 2013, stating

that the third and fourth defendants are neither guarantors nor borrowers of the alleged suit loan. Further, they have never given any undertaking to

pay the said loan amount. The defendants 3 and 4 neither executed any undertaking letters nor promised to pay the said loan amount. The third

defendant further stated that the documents annexed along with the plaint is invalid and inadmissible in evidence. Further, the defendants 3 and 4

have no intention to alienate the schedule mentioned properties.

On considering the averments of both parties, the learned Judge had framed an issue, viz.,

Whether the plaintiff has made out a case for granting interim injunction as required under Order 39 Rule 1 and 2 of C.P.C.?

The learned Judge, after hearing the arguments of the highly competent counsels on either side and on perusing the documents enclosed with the

plaint, dismissed the said Interlocutory Application in I.A. No. 87 of 2013 in O.S. No. 51 of 2013, dated 29.08.2013 and assigned the reasons

that:-

(i) It appears that no prayer for permanent injunction restraining the defendants from alienating the properties was prayed for in the suit by paying

sufficient Court fee.

(ii) Further, the second reason was that the plaintiff has neither come forward with the name of the proposed purchaser nor produced any other

document to show that the respondents had undertaken not to alienate the property without repaying the loan amount to the plaintiff. Hence, the

learned Judge passed the said order. Further, the learned Judge observed that the plaintiff has not made out a case to show that the two principles

viz., prima-facie case and balance of convenience are in his favour.

Aggrieved by the said order, the plaintiff has filed the above appeal.

The highly competent counsel for the appellant vehemently argued that the plaintiff had initiated a suit against the four defendants for recovery of

a sum of Rs. 2,99,40,000/- with interest of a sum of Rs. 98,80,200/-. In order to recover the said amount by way of a money suit, the plaintiff had

executed 28 valid documents. The third and fourth defendants have duly executed an undertaking letter on 15.11.2012 in favour of the plaintiff. As

such, the third and fourth defendants are also jointly and severally liable to pay the said loan amount. Further, the defendants 1 and 2 had executed

promissory notes in favour of the plaintiff and promised them to repay the said principal amount with interest on demand. As such, the plaintiff had

approached the trial Court for judgment and decree.

In the meanwhile, the third and fourth defendants, who are the son-in-law and daughter of the first and second defendants are taking speedy

steps to alienate the suit property. The first and second respondents have also colluded with the third and fourth defendants in order to avoid and

evade payment of loan amount. Under the circumstances, the interim order is absolutely necessary in order to safeguard the plaintiff''s interest and

to prevent alienation of the property mentioned in the Interlocutory Application. The very competent counsel has filed additional typed set of

papers, which contains pronotes and undertaking letters duly executed by the first and second defendants in favour of the plaintiff. Therefore,

prima-facie case has been made out. Further, if the defendants alienate the said property, the plaintiff has no alternate way to recover the said

amount from the defendants, since the defendants only source for repaying the said amount is the scheduled mentioned property mentioned in the

application.

Further, if the interim order is granted, the interest of the plaintiff will be secured. The respondents also mentioned before the Court that they will

come forward with an arrangement before the Court and have failed to do so. The learned Judge miserably failed to appreciate the case of the

plaintiff. It is an admitted fact that all the defendants have given an undertaking not to alienate the property, which amounts to indirect consent for

granting interim order in favour of the plaintiff. The highly competent counsel further has submitted that the interim order is to prevent the

defendants 3 and 4 from alienating the property and this is not a final order. Therefore, at this stage, the interim order is absolutely necessary in the

interest of both parties.

The learned counsel for the appellant has cited the following judgments in support of his contentions:-

(i) K. Jayalakshmi Vs. S.M. Muthaier,

...... With a view to safeguard the interest of a plaintiff during the interregnum between the filing of the application for an order of attachment and

the service of notice on the defendant and his or her appearing in response to that with reference to matters mentioned in the notice and showing

cause, etc., the Court is empowered under Order 38, Rule 5(1), Civil Procedure Code, to direct a conditional attachment of the whole or any

portion of the property specified in the application for attachment. In this, connection, the language of Order 38, Rule 5(3), Civil Procedure Code,

should also be borne in mind.

(ii) Nagpal Steel Limited and Another Vs. Arjun Dev Verma and Another,

The provisions of Order 38, Rule 5 of the CPC are stringent and are exercised normally by the Courts when the applicant is able to make out a

prima facie case on the one hand and on the other hand is able to satisfy the ingredients under these provisions. In the present case there are

specific allegations made in the application that the defendants are bent upon disposing of the goods as well as the immovable property at Satsang

road. Industrial Area, Ludhiana to defeat the decree which is likely to be passed in their favour. The allegations were vaguely denied an even

detailed reply to this application was not filed. May be the provisions are stringent but where the facts and circumstances of the case makes it

apparent on record that the intention of the defendant is not bona fide and they are attempting to frustrate the decree which is likely to be passed in

favour of the plaintiff and they offend any of the clauses to Order 38, Rule 5, the Court would normally come to the rescue of the applicant for

such safeguard.

(iii) M/s. Lingam & Co. Vs. Unknown, C.M.A. (MD) No. 1137 of 2009, dated 03.02.2011

The respondent had contested the petition. While denying the allegations, the respondent had given an undertaking before the trial Court saying

that he would not alienate the schedule mentioned property at any time before the disposal of the suit.

(iv) Fathima Saw Mill Vs. B.G. and Sons and Others

Civil Procedure Code - Order 38 Rule 5 - Suit for recovery of a sum for goods sold - Two applications filed for interim injunction, and attachment

before judgment - Interim injunction granted not to alienate property - Defendants filed application to vacate interim order - Single Judge dismissed

both injunction application and application filed under Order 38 Rule 5 - Plaintiff filed appeals � Held - After passing order of ad interim

injunction, defendants sold 14 cents - Plaintiff filed contempt application - Undertaking given by the defendants not to alienate rest of properties -

Such conduct itself sufficient to pass an order of attachment - Single Judge should have taken into consideration subsequent conduct of defendants

- Fit case for ordering attachment - In view of order of attachment, interim injunction application need not be considered.

Hence, the highly competent counsel appearing for the appellant entreats the Court to allow the above appeal and direct the

respondents/defendants 3 and 4 not to alienate the schedule mentioned property mentioned in the application in I.A. No. 87 of 2013.

Mr. R. Murali, the very competent counsel for the respondents argued that the plaintiff had not made out a case to show that the three

principles, viz., prima-facie case, irreparable loss and balance of convenience vests in his favour. Further, the learned Judge had adduced valid

reason for rejecting the interlocutory application since prima-facie case and balance of convenience has not been made out. The plaintiff filed the

suit on 08.07.2013 along with the said Interlocutory Application.

At the time of admission, the prima-facie case has not been made out. After filing counter statement, the Interlocutory Application was dismissed

on merits. Subsequently, the defendants have filed a detailed written statement and resisted the money suit. Now, the suit is ready for trial.

Further, in the suit, several issues have arisen and all the issues have to be decided after recording evidence and marking documents, if any of both

the parties. Only then, the learned Judge, could pass a quality judgment to the parties concerned. Before proving the case against the defendants, if

the trial Court grants interim relief, as prayed by the plaintiff, it would be prejudicial to the rights of the defendants. The plaintiff themselves have

stated that the defendants are financially sound enough to repay the said loan amount and as such, the interim order is not required. Hence, the

highly competent counsel entreats the Court to dismiss the above appeal since there is no shortcomings in the impugned order passed in the

application.

From the above discussions, this Court is of the view that:-

(i) the first and second defendants are the primary borrowers of the loan from the plaintiff and that the third and fourth defendants are guarantors as

per the ingredients of the plaint.

(ii) Now the defendants have filed written statement and resisted the said suit, which is presently about to be tried.

(iii) The plaintiff is entitled for speedy trial as per Article 21 of the Constitution of India. Further, if the interim order is not granted, the plaintiff

would not be put into hardship or irreparable loss, which is the main principle for granting interim order, since the plaintiff has ample opportunities

to get relief in his main suit, after establishing his case. Only then, he can recover the amount from the defendants, since the defendants have

immovable properties whose value is much more than the suit value, as is evident from the list of scheduled mentioned properties, annexed in the

I.A., which has been admitted by both parties.

On considering the facts and circumstances of the case and arguments advanced by the learned counsels on either side and on perusing the

impugned order of the trial Court and this Court''s view mentioned above, it is evident that the above appeal does not have enough force to merit

consideration. Hence, the appeal fails. This Court directs the learned Principal District Judge, Thanjavur, to dispose the main case in O.S. No. 51

of 2013, on his file, on the topmost priority basis, without being influenced by the discussions of this Court. In the result, the above appeal is

dismissed. Consequently, the order and decreetal order passed in I.A. No. 87 of 2013 in O.S. No. 51 of 2013, on the file of the Principal District

Judge, Thanjavur, dated 29.08.2013 is confirmed. There is no order as to costs. Consequently, connected petitions are closed.