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2017 Supreme(AP) 206

IN THE HIGH COURT OF JUDICATURE AT HYDERABAD
C.V. NAGARJUNA REDDY & J. UMA DEVI, JJ.
M/s. Mahaveer Infoway Limited Rep. by its Director Ashok Kumar Jain & Another – Appellants
Versus
M/s. Tech Minfy Info Solutions LLP, Rep. by its Partner Anand Tirumani & Others – Respondents
Civil Miscellaneous Appeal No. 459 of 2017
Decided On : 23-06-2017

Advocates Appeared:
For the Appellant :Vedula Venkataramana, Senior Counsel for M/s. Bharadwaj Associates, Advocates
For the Respondent:S. Niranjan Reddy, Senior Counsel, for A. Venkatesh, Advocates.

Important Point—In absence of any guiding principles under Arbitration Act, Court has to necessarily fall back upon provisions of Order XXXIX CPC which apply to every application filed for grant of temporary injunctions and interlocutory orders.

Headnote:(A) Arbitration and Conciliation Act, 1996—Section 9—Injunction—Section 9 of Arbitration Act empowers Court to grant certain interim measures in favour of a party before or during arbitral proceedings or at any time after making of arbitral award but before it is enforced in accordance with Section 36 of the Act—Such interim measures include interim injunction—Arbitration Act does not contain any provision laying down principles governing discretion of Court while granting such reliefs either by way of ad interim orders or as a final relief—In absence of any guiding principles under Arbitration Act, Court has to necessarily fall back upon provisions of Order XXXIX CPC which apply to every application filed for grant of temporary injunctions and interlocutory orders—Even if proviso to Rule 3 of Order XXXIX CPC does not per se apply, analogous procedure must be followed by Court dealing with application for injunction under Section 9 of Arbitration Act.

       (B) Civil Procedure Code, 1908—Order 39 Rules 3-A and 4—Injunction—Appeal lies against an ex parte ad interim injunction order if the order does not satisfy mandatory requirement of giving reasons in terms of proviso to Rule 3 of Order XXXIX CPC.

       Result—Appeal allowed.

JUDGMENT :

C.V. Nagarjuna Reddy, J.

1. This civil miscellaneous appeal is directed against an ex parte interim order dt.18.5.2017 in O.P. No.4 of 2017 on the file of the Vacation Civil Judge-cum-IX Additional Chief Judge, City Civil Court, Hyderabad.

2. The facts giving rise to this appeal, precisely stated, are as follows.

Respondent No.1 is a limited liability partnership firm (LLP) incorporated under the provisions of the Limited Liability Partnership Act, 2008 (for short, ‘the Act’). Appellant No.1, which is represented by its Director, appellant No.2, is a 50% shareholder in the LLP, while respondent No.2 holds the balance 50% share therein. The LLP was formed on 16.12.2014 under a partnership deed and was accordingly incorporated under the Act. Respondent Nos.1 and 2 filed O.P. No.4 of 2017 in the Court of Chief Judge, City Civil Court, Hyderabad, under Section 9 of the Arbitration and Conciliation Act, 1996 (for short, ‘the Arbitration Act’).

3. The main allegation of respondent Nos.1 and 2 against the appellants is that the appellants in collusion with respondent Nos.3 and 4, the sons of appellant No.2, who formed respondent No.5 company, are indulging in the business similar to that of respondent No.1 in gross violation of the LLP and that thereby the appellants are causing huge loss to respondent Nos.1 and 2 not only in terms of monetary aspects but also in terms of reputation loss as well. It was further alleged that appellant No.2 is not allowing the designated employees of respondent No.1 to the office space so as to work on the prospects of respondent No.1 and is interfering with their works. It was further averred that respondent No.2 being the 50% partner of respondent No.1 is entitled to have access to APN Portal apart from having access to credentials, servers, portals, websites, emails etc., and that the same is being deliberately denied by appellant Nos.1 and 2 in collusion with respondent Nos.3 and 4. It was also alleged that the appellants in order to camouflage their illegal activities are deliberately not providing access to respondent No.2 and/or sharing the details of respondent No.1 with respondent No.2. That if respondent Nos.1 and 2 continue to have access to the resorts, hotels, accounts, etc., the illegal activities of the appellants would have been got exposed. By claiming that respondent Nos.1 and 2 are entitled to initiate legal action against the appellants by way of arbitration proceedings, they have averred that pending initiation of such proceedings there is every possibility that the appellants, in order to cover up their illegal acts and also render the arbitration proceedings a fait accompli, may resort to manipulation of records by denying access to respondent Nos.1 and 2 to credentials, servers, websites, AWS Accounts, APN Portals, Zoh Books etc. On the aforementioned averments, respondent Nos.1 and 2 claimed the following reliefs:

“...to grant an interim injunction pending the present O.P. as follows:

a. Directing the Respondents from not disabling the Google email server access to the petitioner No.2 and thereby enabling the petitioner No.2 from having full access to the administrative rights [Techminfy domain (www.techminfy.com), Amazon Partner Network (APN), Portal Alliance Lead] to the petitioner No.1.

b. Directing the respondent Nos.2 to 5 from not doing similar business as to that of M/s. TechMinfy Info Solutions LLP, i.e., petitioner No.1, by using its credentials.

c. Directing the respondents from diverting the clients of M/s.Techminfy Info Solutions LLP to respondent No.5 as well as any other company in which the Respondents have similar interests directly or indirectly.

d. Restraining the Respondent Nos.1 & 2 from denying access to designated employees of the petitioner to the office space of M/s. Techminfy Info Solutions LLP;

e. Direct Respondent No.5 to render accounts;

f. Pass such other order or orders as this Hon’ble Court may deem fit and proper in the interest of justice and equ

























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