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2025 Supreme(Online)(KAR) 1624

IN THE HIGH COURT OF KARNATAKA AT BENGALURU
K. NATARAJAN, J
M/s Garudadhri Developers, A Registered Partnership Firm – Appellant
Versus
N.r. Nagendra, S/o Late V. M. Rangaiah – Respondent
MISCELLANEOUS FIRST APPEAL NO.3846 OF 2023



Important Points

A plaintiff can seek a temporary injunction against a defendant's property not directly involved in a suit if there is a risk of the defendant defrauding creditors, as per Order 39 Rule 1(b) of CPC.

Subject

Civil Law - Injunctions

Act Referred

Civil Procedure Code, 1908: Order 39 Rule 1, Order 39 Rule 2

Headnote

(A) Civil Procedure Code, 1908 - Order 39 Rule 1 and 2 - Appeal against rejection of application for temporary injunction - Plaintiff sought recovery of Rs.4,25,00,000/- from defendants, alleging non-execution of sale deed despite payment - Court found prima facie case for injunction against alienation of property to protect plaintiff's interest - Balance of convenience favored plaintiff, leading to interference with Trial Court's order. (Paras 9, 20, 21)

(B) Temporary Injunction - Criteria for grant - Court may grant injunction to prevent alienation of property not directly involved in the suit if it is established that the defendant intends to defraud creditors. (Paras 18, 19)

Facts of the case:
The plaintiff filed a suit for recovery of a substantial amount paid to defendants under an agreement of sale, alleging that the defendants were avoiding execution of the sale deed. The plaintiff sought an injunction to prevent the defendants from alienating the property in question.

Findings of Court:
The court found that the plaintiff had made a prima facie case for the injunction and that irreparable loss would occur if the injunction was not granted.

Issues: The main issues were whether the plaintiff made out a prima facie case, whether the balance of convenience lay in his favor, and whether the Trial Court's order warranted interference.

Ratio Decidendi: The court ruled that the plaintiff could seek an injunction against the defendants' property even if it was not the subject matter of the suit, based on the provisions of Order 39 Rule 1(b) of CPC.

Result: Appeal allowed; Trial Court's order set aside.

Advocates:
Advocate Appeared:
For the Appellant :SRI. SAMPATH A., ADVOCATE
For the Respondent:SRI. KALYAN R., ADVOCATE FOR R1

CAV JUDGMENT

This appeal is filed by the appellant/plaintiff under Order 43 Rule 1 (r) of CPC for setting aside the order dated 06.04.2023 passed by the I-Additional Senior Civil Judge and JMFC, Nelamangala in O.S.No.1024/2022 for having rejected the application filed under Order 39 Rule 1 and 2 of CPC .

02. Heard the arguments of the learned counsel for the appellant and the learned counsel for the respondents.

03. The appellant was the plaintiff and respondents were the defendants in the Trial Court. The parties are referred as per their rank before the Trial Court for the sake of convenience.

04. The case of the plaintiff before the Trial Court is that the plaintiff has filed the suit for recovery of Rs.4,25,00,000/- from the defendants with 12% interest contending that the defendant No.1 who is an Advocate by profession entered into an agreement of sale in respect of land in Sy.No.40/1 new Sy.No.40/3 measuring 2 acre 39 guntas situated at Mallarabanavadi village, Kasaba Hobli, Nelamangala taluk with defendant No.2. It is alleged that defendant No.2 filed suit against the defendant No.1 as there was an agreement of sale between them. Therefore, the plaintiff paid Rs.4,00,00,000/- to the members of the family of defendant No.2, in turn defendant No.2 paid money to defendant No.1 and got compromised in O.S.No.345/2010 and after the compromise defendant No.1 undertook to execute the sale deed but he has not executed the sale deed in his favour since a suit in O.S.No.1084/2009 filed by Jayamma was pending before the court. The plaintiff paid huge amount to defendant No.1 and plaintiff paid amount to the defendant No.2 and family members on various dates which was referred in the plaint. Inspite of same, they are avoiding for execution of sale deed. The said O.S.No.1084/2009 also came to be compromised and Rs.80,00,000/- was paid by the plaintiff to the defendant No.1 to be payable to the defendant No.2 and an execution also filed by the defendant No.1 in Ex.No.13/2013 to obtain the sale deed in terms of compromise. The plaintiff also filed an application which came to be dismissed. Hence, the plaintiff filed the suit for recovery of money paid by him against both defendant Nos.1 and 2 and others.

05. Plaintiff also filed an I.A.No.1 under Order 39 Rule 1 and 2 CPC seeking attachment of the property belongs to the defendants and that property should be protected from alienation otherwise it is difficult for the plaintiff to recover the money. Hence, he has filed application for restraining the defendants from alienating the property in Sy.No.40/3.

06. The defendants appeared and filed objection apart from written statement and application came to be rejected. Hence, the plaintiff is before this court.

07. The learned counsel for the plaintiff argued by contending that the Trial Court rejected the application mainly on the ground that the said property is not subject matter of the suit, it is only money recovery suit, therefore, no injunction can be granted against the said property, which is not correct, as per Order 39 Rule 1(b) CPC the property of the defendant can be attached by the Court pending consideration of money recovery suit. Such being the case, the order of the Trial Court is erroneous and liable to be set aside. The learned counsel also contended that there was an agreement of sale between defendant Nos.1 and 2 where defendant No.2 agreed to sell the property to defendant No.1 and a suit was filed by defendant No.1 based upon agreement of sale. In the meanwhile, defendant No.1 introduced the plaintiff as assignee. The plaintiff paid the money to defendant No.2 and got compromised the case and one more suit was filed by Jayamma and others in O.S.No.1084/2009. In the said suit, the plaintiff paid huge money and the said case was also compromised. The compromise application also reveals the amount paid by the plaintiff to defendant No.2 on behalf of defendant No.1. Such being the case, plaintiff made out a prima facie case f

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