Whether court should pass order of mesne profits while granting injunction to a party?

Mesne Profits

90. Experience has shown that all kinds of pleadings are introduced and even false and fabricated documents are filed in civil cases because there is an inherent profit in continuation of possession. In a large number of cases, honest litigants suffer and dishonest litigants get undue benefit by grant or refusal of an injunction because the Courts do not critically examine pleadings and documents on record. In case while granting or refusing injunction, the Court properly considers pleadings and documents and takes the pragmatic view and grants appropriate mesne profit, then the inherent interest to continue frivolous litigation by unscrupulous litigants would be reduced to a large extent.

91. The Court while granting injunction should broadly take into consideration the prevailing market rentals in the locality for similar premises. Based on that, the Court should fix ad hoc amount which the person continuing in possession must pay and on such payment, the Plaintiff may withdraw after furnishing an undertaking and also making it clear that should the Court pass any order for reimbursement, it will be a charge upon the property.

92. The Court can also direct payment of a particular amount and for a differential, direct furnishing of a security by the person who wishes to continue in possession. If such amount, as may be fixed by the Court, is not paid as security, the Court may remove the person and appoint a receiver of the property or strike out the claim or defence. This is a very important exercise for balancing equities. Courts must carry out this exercise with extreme care and caution while keeping pragmatic realities in mind and make a proper order of granting mesne profit. This is the requirement of equity and justice.

IN THE SUPREME COURT OF INDIA

Appeal No. 2968 of 2012 (Arising out of SLP (C) No. 15382 of 2009)

Decided On: 21.03.2012

Maria Margarida Sequeria Fernandes and Ors. Vs. Erasmo Jack de Sequeria (Dead) through L. Rs.

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Whether requirement to make application for stay and furnishing security provided under Arbitration amendment Act 2015 is retrospective in nature?

In such a situation, it would have to be considered, independent of Section 26 of the Amending Act, as to whether the amended provisions applied to the said second and third category of cases. In this regard, we may note the observations of the Supreme Court in Thyssen (supra) where, after, considering several earlier decisions, the Supreme Court observed in paragraph 32 (which we have already extracted above) that the principles enunciated in the judgments show as to when a right accrues to a party under a repealed Act. The Supreme Court observed that it is not necessary that for the right to accrue, legal proceedings must be pending when the new Act comes into force. Furthermore, and more importantly, the Supreme Court observed that to have the award enforced when arbitral proceedings commenced under the old Act under that very Act was certainly an accrued right. In other words, all the aspects of enforceability of an award entail an accrued right both in the person in whose favour the award is made and against whom the award is pronounced. It will also be noticed that the Supreme Court made it clear that for the right to accrue, there is no necessity that legal proceedings must be pending when the new Act comes into force. This exactly covers the situation as obtaining in the second category of cases, where the arbitral proceedings were commenced prior to 23.10.2015 and the award was also made prior to 23.10.2015, but the petition under Section 34 had not yet been filed. This is the same situation as in the present case. Thus, the pendency of any legal proceedings or otherwise would not come in the way of determining as to whether the right had accrued under the unamended provisions or not. We have already noted that the Supreme Court in Thyssen (supra) observed that the right to have the award enforced (which also comprises of the negative right of the award debtor to not have it enforced till his objections under Section 34 of the said Act are heard and decided) is certainly an accrued right. Given the fact that the amended Section 36 takes away the right of an automatic stay of enforcement of an award, it is clear that the amendment introduced in Section 36 by virtue of the Amending Act would definitely impinge upon the accrued right of the party against whom the award is given after the arbitral proceedings have been held under the unamended provisions. Since an accrued right is affected, unless a contrary intention appears in the amending statute, the amendments would have to be treated as prospective in operation. Prospective from the standpoint of commencement of the arbitral proceedings.

IN THE HIGH COURT OF CALCUTTA

E.C. No. 1 of 2017

Decided On: 28.06.2017

 Braithwaite Burn & Jessop Construction Co. Ltd. Vs.  Indo Wagon Engineering Ltd.

Hon'ble Judges/Coram:

Soumen Sen, J.

Citation: AIR 2017(NOC) 923 Cal

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Whether dishonour of post-dated cheque given for repayment of loan installment is covered by S 138 of NI Act?

Question for consideration is whether in the facts of the present case,
the dishonour of a post-dated cheque given for repayment of loan
installment which is also described as “security” in the loan
agreement is covered by Section 138 of the Negotiable Instruments
Act, 1881 (“the Act”).
 Crucial question to determine applicability of Section 138 of the
Act is whether the cheque represents discharge of existing
enforceable debt or liability or whether it represents advance payment
without there being subsisting debt or liability. While approving the
views of different High Courts noted earlier, this is the underlying
principle as can be discerned from discussion of the said cases in the
judgment of this Court.
 As is clear from the above observations of this Court, it is well
settled that while dealing with a quashing petition, the Court has
ordinarily to proceed on the basis of averments in the complaint. The
defence of the accused cannot be considered at this stage. The court
considering the prayer for quashing does not adjudicate upon a
disputed question of fact.
18.In Rangappa versus Sri Mohan 9 (2010) 11 SCC 441Page 11, this Court held that once issuance
of a cheque and signature thereon are admitted, presumption of a
legally enforceable debt in favour of the holder of the cheque arises.

It is for the accused to rebut the said presumption, though accused
need not adduce his own evidence and can rely upon the material
submitted by the complainant. However, mere statement of the
accused may not be sufficient to rebut the said presumption. A post
dated cheque is a well recognized mode of payment
19. Thus, the question has to be answered in favour of the
respondent and against the appellant. Dishonour of cheque in the
present case being for discharge of existing liability is covered by
Section 138 of the Act, as rightly held by the High Court.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO. 867 OF 2016


SAMPELLY SATYANARAYANA RAO Vs  INDIAN RENEWABLE ENERGY DEVELOPMENT
AGENCY LIMITED

Dated:SEPTEMBER 19, 2016.

ADARSH KUMAR GOEL, J.

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Whether appeal can be dismissed if appellant fails to make deposit or furnish security?

The submission of the learned counsel for the respondent is that the High Court was right in giving the direction regarding the deposit of Rs 75,000 as per the aforesaid provision and since the appellant has failed to comply with the same the appeal has been rightly directed to be dismissed. We, however, find that the only consequence for non-compliance with the direction given under Sub-rule (3) of Rule 1 of Order XLI is as provided in Sub-rule (5) of Rule 5 of Order XLI which reads as under: "(5) Notwithstanding anything contained in the foregoing sub-rules, where the appellant fails to make the deposit or furnish the security specified in Sub-rule (3) of Rule 1, the Court shall not make an order staying the execution of the decree."

8. This would mean that non-compliance with the direction given regarding deposit under Sub-rule (3) of Rule 1 of Order XLI would result in the Court refusing to stay the execution of the decree. In other words, the application for stay of the execution of the decree could be dismissed for such non-compliance but the Court could not give a direction for the dismissal of the appeal itself for such non-compliance.

Supreme Court of India

Kayamuddin Shamsuddin Khan vs State Bank Of India on 19 January, 1995

Equivalent citations: (1998) 8 SCC 676

Bench: S Agrawal, F Uddin

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Whether court should take security from plaintiff prior to grant of status quo in case of removal of encroachment?

This Court has carefully gone through the provisions

of Maharashtra Land Revenue Code like sections 50 to 53. The

provision of section 50 (5) shows that order made by Collector

can be challenged by filing appeal before the appellate authority.

Admittedly, this recourse was not used. The provision of section

50 (6) shows that only when the decision given under these

provisions becomes final, the suit can be filed to establish the

rights in Civil Court and that too, within six months from the date

when the decision of the revenue authority becomes final. It can

be said that in the present matters, there is no right as such to

the plaintiffs to continue the possession, but by making some

contentions, they have remained on the space due to the orders

made by the Courts below. The Trial Court has rightly held that

the provision of section 50 is applicable in such cases. The

record is produced to show that the Collector has delegated the

powers to Tahsildar, both in respect of agricultural lands and non

agricultural lands. Thus, there is no illegality in the notices given

against the plaintiffs and there are further aforesaid

circumstances. In view of the facts and circumstances, this Court

has no hesitation to observe that the Courts below did not take

proper care, they did not take even the security from the

plaintiffs for getting order like statusquo and due to that the

Government could not take the steps like widening of the road in

respect of that portion.

IN THE HIGH COURT AT BOMBAY

APPELLATE SIDE, BENCH AT AURANGABAD

 SECOND APPEAL NO. 255 OF 2016

RAJENDRA POPAT WAGHMARE AND OTHERS

VERSUS

THE STATE OF MAHARASHTRA THROUGH THE DISTRICT

COLLECTOR

CORAM : T.V. NALAWADE, J.

DATED : 31st March, 2016.

Citation: 2016 (4) MHLJ 475

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When owner of vehicle can not be directed to furnish security as per prayer of insurance company?

No   doubt,   the   Tribunal   has   held   that   the
respondent No. 2 ­Reliance General Insurance Company to
pay   the   compensation   to   the   claimants   and   thereafter   torecover it from the owner of the vehicle.   However, in the
facts of the present case,  it is not possible to hold that before
release of the amount deposited by the respondent No. 2
Reliance General Insurance Company,  the owner should be
directed to secure the payment of compensation made to the
claimants.  It was  a third party claim and the liability of the
respondent   No.   2   ­Reliance   General   Insurance   Company
was unlimited.  The Tribunal has recorded the specific finding
that   the   respondent   No.   2   ­Reliance   General   Insurance
Company has failed to prove that the communication about
the dishonour of cheque submitted towards premium was
sent   to   the   Regional   Transport   Office.   The   liability   of

respondent No. 2 ­Reliance General Insurance Company is
absolute and hence, there is no occasion to direct furnishing
of   security   by   the   owner   as   a   condition   precedent   forwithdrawal of the amount deposited before the tribunal.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH, NAGPUR
FIRST APPEAL NO. 344 OF 2015 
 Gopalrao Punjaji Gayki,

...VERSUS...
Gopal s/o Dnyandeo Wakode,

CORAM: R. K. DESHPANDE, J.
DATE    :   14thJanuary, 2016 .
Citation;2016(1) ALLMR386

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Whether Complaint for Dishonour of Cheque can be quashed on the ground that ‘Cheque was issued as Security?

A two Judge Bench of the Supreme Court in HMT Watches Ltd. Vs. Abida [Crl. Appeal  No;472 of 2015] it is held that a complaint filed U/S 138 of Negotiable Instrument Act for ‘dis-honour of Cheque’ cannot be quashed by High Court on the ground that ‘Cheque was issued as Security’, invoking the power U/S 482 of Criminal Procedure Code .

While reversing a Judgment from High Court of Kerala the Bench comprising of Justice DIpak Mishra and Justice Prafulla C. Pant had held as follows;

“Having heard learned counsel for the parties, we are of the view  that the accused (respondent no.1) challenged the proceedings  of  criminal complaint cases  before  the  High  Court,  taking  factual  defences. Whether the cheques were given as security or not,  or  whether  there was outstanding liability or not is a question  of  fact  which  could have been determined only by the trial court after recording  evidence of the parties. In  our  opinion,  the  High  Court  should  not  have expressed its view on the disputed questions of  fact  in  a  petition under Section 482 of the Code of Criminal  Procedure,  to  come  to  a conclusion that the offence is not made out.  The High Court has erred in law in going into the factual aspects of the matter which were  not admitted between  the  parties.

The  High  Court  further  erred  in observing that Section 138(b)  of  N.I.  Act  stood  uncomplied,  even though the respondent no.1 (accused) had admitted that he replied  the notice issued by the complainant.  Also, the fact, as to whether  the signatory of demand notice was authorized by the  complainant  company or not, could not  have  been  examined  by  the  High  Court  in  its jurisdiction under Section 482 of the Code of Criminal Procedure  when such plea was controverted by the complainant before it.”

The Bench relied on the following observation of Supreme Court in Suryalakshmi Cotton Mills Limited v. Rajvir Industries Limited and Others[…………………] “Ordinarily, a defence of an accused although appears  to  be plausible should not be taken into consideration for exercise of the said jurisdiction. Yet again, the High Court at  that  stage would not ordinarily enter into a disputed question of fact. It, however, does not mean that documents of unimpeachable character should not be taken into  consideration  at  any  cost  for  the purpose of finding out as to whether continuance of the criminal [pic]proceedings would amount to an abuse of process of court or that the complaint petition is filed for causing mere harassment to the accused. While we are not  oblivious  of  the  fact  that although  a  large  number  of  disputes  should  ordinarily  be determined only by the civil  courts,  but  criminal  cases  are filed only for achieving the ultimate goal, namely, to force the accused to pay the amount due to  the  complainant  immediately.

The courts on the one hand should not encourage such a practice; but, on the other, cannot also travel beyond its jurisdiction to interfere with the proceeding which is  otherwise  genuine. The courts cannot also lose  sight  of  the  fact  that  in  certain matters, both civil proceedings and criminal  proceedings  would be maintainable.’

The Bench allowed the Appeal by holding that the High Court exceeded its jurisdiction by  giving  its  opinion on disputed questions of fact, before the trial court.
Reportable
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO. 471 OF 2015
(Arising out of SLP (Crl) No. 5295 OF 2014)
HMT Watches Ltd.
... Appellant
Versus
M.A. Abida & Anr.
Respondents
...
WITH
CRIMINAL APPEAL NO. 472 OF 2015
(Arising out of SLP(Crl) No. 5800 OF 2014)
Dated;March 19, 2015

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Procedure to be followed by court when JD appears before court in obedience to notice issued U/R 37 of Order 21 of CPC

Applying the parameters of the afore said provision in

the instant case, the petitioner/judgment debtor, in the present
case, had appeared before the learned Judge in obedience to
notice issued under Rule 37 of Order 21 of the Code of Civil
Procedure, but although it was incumbent upon the learned Judge
to proceed to hear the decree-holder and to take all such
evidence as may be produced by him in support of his application
for execution, and although it was incumbent upon the learned
Judge
then to give judgment debtor an opportunity of showing
cause why he should not be committed to civil prison, the learned
Judge did not follow the said procedure of inquiry before passing
the impugned order dated 28.4.2000. Moreover, upon conclusion
of inquiry, it was obligatory upon the learned Judge to follow the
procedure prescribed in sub-rule (3) and more particularly proviso
thereof of Rule 40 of Order 21 of the Code of Civil Procedure, but
the learned Judge did not comply with the said provisions prior to
passing the impugned order on 28.4.2000. Besides that, it was

expected from the learned Judge to follow the procedure as
prescribed in amended sub-rule (6) of Rule 40 of Order 21 of the
Code of Civil Procedure, but same has not been followed in letter
and spirit while passing the impugned order dated 28.4.2000.
In the circumstances, it is amply clear that the

impugned order passed by the learned Civil Judge, Senior

Division, Ahmednagar on Exh.24 in Special Darkhast No. 64 of
1990 on 28.4.2000 is illegal, improper and erroneous and same
deserves to be quashed 
IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
AURANGABAD BENCH, AURANGABAD
CIVIL REVISION APPLICATION NO. 525 OF 2000

Satish s/o Ramchandra Shahapurkar,

VERSUS

Gorakshnath Madhavrao Pund,

Coram : Shrihari P. Davare, J.

Date of pronouncing:17.7.2009
Citation;2009(6)ALLMR660,2009(6)BomCR850,
2010(1)AIRBomR591

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