1993 Supreme(P&H) 644
PUNJAB & HARYANA HIGH COURT
V.K.Jhanji, J.
Indian Overseas Bank
Versus
Mertinez Engineering Limited And Anr.
Civil Revision No. 2590 of 1992,
Decided On : AUGUST 25, 1993
Mandatory injunctions are granted to preserve or restore the status quo of the last non-contested status which preceded the pending controversy until the final hearing.
Headnote:
INJUNCTION - MANDATORY - ORDER 39 RULES 1 AND 2 CPC - SUMMARY
Fact of the Case:
The respondent-company filed a suit against the petitioner-bank challenging the bank's decision to close the company's current account. The company also filed an application for grant of injunction in mandatory form for a direction to the bank to allow the company to operate on the current account during the pendency of the suit.
Finding of the Court:
The court held that there were no exceptional circumstances which would warrant issuing of injunction in mandatory form. The court noted that the relations between the bank and the company were not cordial and that there was ongoing civil and criminal litigation between the parties.
Issues: Whether the bank was legally obligated to continue the company's account.
Ratio Decidendi: The court held that the relationship between the bank and the company was purely of debtor and creditor, which relationship could be terminated at any time. The court also held that mandatory injunction cannot be granted for relief which was not existing at the time of filing of the suit.
Final Decision: The court allowed the civil revision, set aside the order of the first Appellate Court, and restored the order of the trial Court dismissing the company's application for injunction.
V.K.Jhanji, J.
1. This revision petition is directed against the order passed by the first appellate Court, reversing the order of the trial Court, on an application filed by the respondent under Order 39 Rules 1 and 2 of the Code of Civil Procedure.
2. In brief, the facts are that respondent-company was maintaining a current account with the petitioner-bank, in its branch office situated at The Mall, Ludhiana. Vide its letter dated 4.3.1991, the bank intimated to the company their intention to close the companys current account. Letter closing the account of the company was challenged by the company by filing a civil suit on 10.4.1991, wherein declaration was sought for declaring letter dated 4.3.1991, sent by the bank to the company, to be illegal, void, arbitrary, and as a consequential relief, the company prayed for a decree for mandatory, injunction, directing the bank for operation of the current account. Along with the suit, an application was made for grant of injunction in mandatory form for a direction to the bank to allow the company to operate on the current account during the pendency of the suit.
3. The suit as well as the application were contested by the bank on the ground that there is no legal obligation for the bank to continue the account of the company. According to the bank, relationship between the bank and company was purely of debtor and creditor, which relationship could be terminated at any time. Further, the case was that company was causing harassment to the officials of the bank. Between two of them, there bad been exchange of large number of letters. Repeated complaints were being made without any basis against the working of the bank and, there fore, the bank decided to close the account. With regard to ad-interim injunction application, it was stated that there are no exceptional circum stances which would justify the grant of injunction in mandatory form. On consideration of pleadings as well as material brought on record, the trial Court dismissed the application. On appeal by the company, order of the trial Court was set aside and as a consequence thereof, the bank was directed to allow the company to operate its current account. This order is now being impugned by the bank in the present revision petition.
4. At the time of motion, hearing, i.e. on 4.9.1992, operation of the impugned order was stayed by this Court.
5. Mr. O.P. Goyal, Sr. Advocate, counsel for the bank, contended that relationship between the bank and the company is of debtor and creditor and as such, relationship, if terminated, cannot be specifically en forced by way of suit. He further contended that mandatory injunction cannot be granted for relief which was not existing at the time of filing of the suit. He also contended that the company has failed to prove that it would suffer an irreparable loss if it is not allowed to operate the account.
6. In reply, learned counsel for the company, contended that the bank being an instrumentality of the State, is bound by the rules and regulations and cannot act arbitrarily. According to him, the plaintiff-Company has a legal right to continue operating its account with the bank.
7. Having heard the learned counsel for the parties, I am of the view that the civil revision deserves to succeed on the short ground that there are no exceptional circumstances which would warrant issuing of injunction in mandatory form. The Company itself has stated in the suit that the relations between the bank and the Company are not cordial. The first Appellate Court has also recorded a finding that" of course it is unfortunate that the relations between the parties have touched their nadir". The bank had issued letters dated 17.1.1991 and 28.1.1991 advising the Company to close their account. Besides, issuing 15 dayss notice to the Company for closing the account, the bank also issued a telegram to the Company in that regard. The amount which was lying deposited in the current account was a