AMBALAL SARABHAI ENTERPRISE LIMITEDversusKS INFRASPACE LLP LIMITED AND ANOTHER

                          [2020] 1 S.C.R. 315                             315


        AMBALAL SARABHAI ENTERPRISE LIMITED                               A
                                  v.
       KS INFRASPACE LLP LIMITED AND ANOTHER
                    (Civil Appeal No. 9346 of 2019)
                         JANUARY 06, 2020                                 B
        [ASHOK BHUSHAN AND NAVIN SINHA, JJ.]
      Injunction:
       Interim injunction – A suit for specific performance – Alleging
that defendant created third party rights, while the contract for sale    C
of suit lands had stood concluded – Trial court by interim injunction
restrained the defendants from executing any further documents or
to deal with the suit land in any manner – High Court affirmed the
order of injunction – Appeal to Supreme Court – Held: A plaintiff
seeking temporary injunction in a suit for specific performance
                                                                          D
has to establish a strong prima facie case on the basis of undisputed
facts – Conduct of plaintiff , balance of convenience and irreparable
injury is also very essential to be considered – In the facts of the
present case, whether there existed a concluded contract is a matter
of trial – The plaintiff had failed to prove that there was a concluded
contract and/or an oral contract by inference – Therefore, the grant      E
of injunction in the present case is unsustainable.
      Allowing the appeals, the Court
      HELD : 1. Chapter VII, Section 36 of the Specific Relief
Act, 1963 provides for grant of preventive relief. Section 37
provides that temporary injunction in a suit shall be regulated by        F
the Code of Civil Procedure. The grant of relief in a suit for specific
performance is itself a discretionary remedy. A plaintiff seeking
temporary injunction in a suit for specific performance will
therefore have to establish a strong prima-facie case on basis of
undisputed facts. The conduct of the plaintiff will also be a very        G
relevant consideration for purposes of injunction. The discretion
at this stage has to be exercised judiciously and not arbitrarily.
In a matter concerning grant of injunction, apart from the existence
of a prima facie case, balance of convenience, irreparable injury,

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                                 315
316            SUPREME COURT REPORTS                      [2020] 1 S.C.R.


A     the conduct of the party seeking the equitable relief of injunction
      is also very essential to be considered. [Paras 15 and 19]
      [323-H; 324-A-B; 326-A]
             2. The negotiations between the plaintiff and the defendant
      is reflected in approximately 17 e-mails exchanged between them
B     commencing from December 2017 to 31.03.2018. The file size
      of the attachment to the mails has varied from 48-50-52-48-
      57-56 KBs indicating suggestions and corrections from time to
      time. The WhatsApp messages which are virtual verbal
      communications are matters of evidence with regard to their
      meaning and its contents to be proved during trial by evidence-
C     in-chief and cross examination. The e-mails and WhatsApp
      messages will have to be read and understood cumulatively to
      decipher whether there was a concluded contract or not. The
      use of the words ‘final draft’ in the e-mail dated 30.03.2018 cannot
      be determinative by itself. The e-mail dated 26.02.2018 sent by
D     the defendant at 11:46 AM had also used the same phraseology.
      [Para 17] [324-G-H; 325-A-B]
              3. The plaintiff was well aware from the very inception that
      the defendant was negotiating for sale of the lands simultaneously
      with two others. The plaintiff was further aware on 30.03.2018
E     itself that the deal with it had virtually fallen through as informed
      to the escrow agent. The fact that a draft MoU christened as
      ‘final-for discussion’ was sent the same day cannot lead to the
      inference in isolation, of a concluded contract. There is no
      evidence at this stage that the acceptance was communicated to
      the defendant before the latter entered into a deal with defendant
F     No. 2 on 30.03.2018 and executed a registered agreement for
      sale on 31.03.2018. Defendant No. 2 paid Rs.17.69 crores and
      Rs. 2.20 crores towards the income tax dues of the defendant
      the same day, as part of the consideration amount. It is only
      thereafter the plaintiff purports to have communicated its
G     acceptance to the defendant on 31.03.2018 at 01.13 PM. The
      prolonged negotiations between the parties reflect that matters
      were still at the ‘embryo stage’. [Para 17] [325-C-E]
            4. The pleadings in the suit acknowledge the awareness of
      the plaintiff of the ongoing negotiations with defendant No. 2.
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         AMBALAL SARABHAI ENTERPRISE LTD. v.                             317
               KS INFRASPACE LLP LTD.

The advance of Rs. 2.16 crores was refunded to the plaintiff in          A
the evening on 31.03.2018 by RTGS. No effort was made by the
plaintiff to again remit the sum by RTGS immediately or the next
day. Only a public notice was published on 03.04.2018 refuted by
the defendant on 04.03.2018. The suit was then filed seven months
later on 01.10.2018. The explanation that the plaintiff waited
                                                                         B
hopefully for a solution outside litigation as a prudent businessman
before finally instituting the suit is too lame an excuse to merit
any consideration. [Para18] [325-F-G]
      5. Defendant No.2, in addition to the dues of the Income
Tax department, had made further payments to the defendant of
Rs.25,44,57,769/- by 16.01.2019 aggregating to a total payment           C
of Rs.45,84,71,869/-. The defendants had also proceeded to utilize
a sum of Rs.36.20 crores and had therefore materially altered
their position evidently by the inaction of the plaintiff to institute
the suit in time and having allowed third party rights to accrue by
making substantial investments. [Para 20] [326-E-F]                      D
       6. In the facts and circumstances of the present case, and
the nature of the materials placed before this Court at this stage,
whether there existed a concluded contract between the parties
or not, is itself a matter for trial to be decided on basis of the
evidence that may be led. If the plaintiff contended a concluded         E
contract and/or an oral contract by inference, leaving an executed
document as a mere formality, the onus lay on the plaintiff to
demonstrate that the parties were ad-idem having discharged
their obligations. The plaintiff failed to show the same on admitted
facts. The draft MoU dated 30.03.2018 in Clause C contemplated
payment of the income tax dues of Rs.18.64 crores as part of the         F
consideration amount only whereafter the agreement was to be
signed relating back to the date 29.03.2008. Had this amount
been already paid or remitted by the plaintiff, entirely different
considerations would have arisen with regard to the requirement
for execution of a written agreement remaining a mere formality.         G
Thus, the balance of convenience is in favour of the defendants
on account of the intervening developments, without furthermore,
inter-alia by reason of the plaintiff having waited for seven months


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318            SUPREME COURT REPORTS                      [2020] 1 S.C.R.


A     to institute the suit. The question of irreparable harm to a party
      complaining of a breach of contract does not arise if other remedies
      are available to the party complaining of the breach. The High
      Court has itself observed that from the negotiations between the
      parties that “some rough weather was being reflected between
      the plaintiff and the defendant ……….”. The Special Civil Judge
B
      failed to address the issue of delay. The High Court noticed the
      arguments of the defendants with regard to delay in the institution
      of the suit but failed to deal with it. Therefore, in the facts and
      circumstances of the present case, the grant of injunction to the
      plaintiff is unsustainable. Resultantly the orders of injunction are
C     set aside. [Paras 21 and 24] [326-H; 327-A-E; 328-F]
            Dalpat Kumar v. Prahlad Singh (1992) 1 SCC 719 :
            [1991] 3 Suppl. SCR 472 ; Agriculture Produce Market
            Committee, Gondal and Ors. v. Girdharbhai Ramjibhai
            Chhaniyara and Ors. (1997) 5 SCC 468 : [1997] 1
D           Suppl. SCR 74 ; Motilal Jain v. Ramdasi Devi (Smt.)
            and Ors. (2000) 6 SCC 420 : [2000] 1 Suppl. SCR
            615 ; Mademsetty Satyanarayana v. G. Yelloji Rao and
            Ors. [1965] 2 SCR 221 ; Mandali Ranganna and Ors.
            v. T. Ramachandra and Ors. (2008) 11 SCC 1 : [2008]
            7 SCR 264 ; Brij Mohan and Ors. v. Sugra Begum and
E           Ors. (1990) 4 SCC 147 : [1990] 3 SCR 413 ; M.P.
            Mathur v. DTC (2006) 13 SCC 706 : [2006] 9 Suppl.
            SCR 519 ; Wander Ltd. and another v. Antox India P.
            Ltd., (1990) Suppl. SCC 727 ; Gujarat Bottling Co. Ltd.
            v. Coca Cola Co. (1995) 5 SCC 545 : [1995] 2 Suppl.
F           SCR 514 – relied on.
            K.S. Vidyanadam & Ors. v. Vairavan, (1997) 3 SCC 1 :
            [1997] 1 SCR 993 ; Mandali Ranganna and Ors. v. T.
            Ramachandra and ors. (2008) 11 SCC 1 : [2008]
            7 SCR 264 ; Mayawanti v. Kaushalya Devi (1990) 3
G           SCC 1 : [1990] 2 SCR 350 ; Moharwal Khewaji Trust
            (Regd.), Faridkot v. Baldev Dass (2004) 8 SCC 488 ;
            Aloka Bose v. Parmatma Devi and Ors. (2009) 2 SCC
            582 : [2008] 17 SCR 822 – referred to.


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         AMBALAL SARABHAI ENTERPRISE LTD. v.                              319
               KS INFRASPACE LLP LTD.

                       Case Law Reference                                 A
[1997] 1 SCR 993                referred to              Para 7
[2008] 7 SCR 264                referred to              Para 8
[1990] 2 SCR 350                referred to              Para 8
(1990) Suppl. SCC 727           relied on                Para 12          B
[1990] 3 SCR 413                relied on                Para 12
[2000] 1 Suppl. SCR 615         relied on                Para 12
(2004) 8 SCC 488                referred to              Para 12
                                                                          C
[2008] 17 SCR 822               referred to              Para 12
[1965] 2 SCR 221                relied on                Para 13
[1991] 3 Suppl. SCR 472         relied on                Para 16
[1997] 1 Suppl. SCR 74          relied on                Para 17
                                                                          D
[2006] 9 Suppl. SCR 519         relied on                Para 22
[1995] 2 Suppl. SCR 514         relied on                Para 23
      CIVIL APPELLATE JURISDICTION : Civil Appeal No. 9346
of 2019.
                                                                          E
      From the Judgment and Order dated 30.08.2019 of the High Court
of Gujarat at Ahmedabad in R/Appeal from Orders No. 73 of 2019.
       Kapil Sibal, C.U. Singh, Huzefa Ahmadi, Dr. A.M. Singhvi, Deven
Parikh, Sr. Advs., Ms. Megha Jani, Ms. Anushree Prashit Kapadia,
Raghav Tankha, Ms. Viddusshi, Ms. Garima Bajaj, Raghvendra Mohan
Bajaj, Sanskar Agarwal Nikhil Goel, Rishabh Parikh, Ashutosh Ghade,       F
Ms. Naveen Goel, Dushyant Sarna, L. Nidhiram Sharma, Advs. for the
appearing parties.
      The Judgment of the Court was delivered by
      NAVIN SINHA, J.                                                     G
      1. The present appeals arise from a common order dated
30.08.2019, passed in three separate miscellaneous appeals filed by the
appellants before the High Court affirming an order of injunction. K.S.
Infraspace LLP Ltd., respondent no.1, filed Special Civil Suit Nos.322
of 2018 and 323 of 2018 before the Court of Principal Civil Judge at
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320            SUPREME COURT REPORTS                           [2020] 1 S.C.R.


A     Vadodara against the appellants in Civil Appeal No.9346 of 2019 (Ambalal
      Sarabhai Enterprise) and Civil Appeal No.9347 of 2019 (Haryana
      Containers Ltd.) respectively, which are sister concerns. The appellant
      in Civil Appeal No.9348 of 2019 (Neptune Infraspace Private Ltd.) was
      impleaded as defendant no.2 in the latter suit. The parties shall be
      referred to by their respective position in the Civil Suit, for the sake of
B
      convenience.
             2. The plaintiff filed the two suits for declaration and specific
      performance against the defendant sister concerns with regard to a total
      area of 19,685 square meters of lands situated in Village Wadiwadi,
      Subhanpura, District Vadodara in Gujarat. The plaintiff contended that
C     there existed a concluded contract with the defendants after negotiations
      for sale of the suit lands for a total sum of Rs.31,81,73,076/- and
      58,26,86,984/- respectively. The plaintiff had duly communicated its
      acceptance of the final draft memorandum of understanding (MoU) dated
      30.03.2018. Only the formal execution of contract documents remained
D     as a formality. A sum of Rs.2.16 crores had also been paid as advance.
      The plaintiff was ready and willing with the balance amount. Alternately,
      it was claimed that there existed a concluded oral contract between the
      parties. The Defendants had surreptitiously entered into a registered
      agreement for sale with defendant no.2 on 31.03.2018 and thus the suit
      and prayer for injunction.
E
              3. The Principal Civil Judge by order dated 18.02.2019 held that
      by inference the terms and conditions for sale stood finalised by the e-
      mail dated 29.03.2018 and 30.03.2018. A token amount of Rs.2.16 crores
      had already been paid and the plaintiff was ready and willing with the
      balance amount. Creation of third party rights would lead to further
F     litigation. Thus by an order of temporary injunction the defendants were
      restrained from executing any further documents including a sale deed
      or creating further charge, interest or deal with the suit lands in any
      manner.
             4. The High Court by its order dated 30.08.2019 affirmed the
G     order of injunction holding that the communication of acceptance to the
      draft MoU sent by e-mail dated 30.03.2018 coupled with the exchange
      of WhatsApp correspondences between the parties amounted to a
      concluded contract.

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           AMBALAL SARABHAI ENTERPRISE LTD. v.                                      321
          KS INFRASPACE LLP LTD. [NAVIN SINHA, J.]

       5. We have heard learned senior counsel Shri Kapil Sibal, Shri               A
C.U. Singh and Shri Huzefa Ahmadi, appearing on behalf of defendant
nos. 1 and 2, who are the appellants before us. Shri Sibal, making the
lead arguments on behalf of the defendant sister concerns submitted
that they had decided to sell the lands in view of financial stringency and
their inability to meet financial commitments inter-alia leading to
                                                                                    B
attachment of immovable properties by the Income Tax Department for
dues of Rs.48,74,45,929/- apart from other statutory liabilities, employee
related liabilities and business liabilities. The negotiations with the plaintiff
did not attain finality but remained at the stage of discussions only. The
wavering conduct of the plaintiff to meet the Income Tax liability of the
defendants as part of the consideration amount to facilitate sale by lifting        C
of the attachment, left the defendants with no other choice but to negotiate
afresh with defendant no.2. The contention that execution of the
agreement remained a formality was disputed. This is evident from the
alternative contention in the suit that there existed an oral contract.
       6. The plaintiff’s response of acceptance to the final draft MoU             D
dated 30.03.2018 was belated. The plaintiff was well aware all along
that the defendants were negotiating with two others also apart from it.
The plaintiff knew before 30.03.2018 that the deal with it was not coming
through and that the defendant was going ahead with another. The deal
with defendant no.2 was finalised by execution of a registered agreement
for sale on 31.03.2018 after defendant no.2 had cleared the Income Tax              E
dues of the sister concerns on 30.03.2018 to the extent of Rs.17.69
crores and Rs.2.20 crores respectively enabling lifting of the attachment
orders for the lands by the Income Tax department on 26.04.2018 followed
by further payments by defendant no.2 aggregating Rs.45.84 crores till
16.01.2019. A sum of Rs. 36.20 crores, from the sale proceeds has                   F
already been utilized by the defendants towards payment of other
statutory liabilities and employee related liabilities etc. It was therefore a
bona fide action. The plaintiff’s e-mail of acceptance of the draft MoU
dated 30.03.2018 as claimed, was not sent by it on 31.03.2018 at 07.43
AM but was received by the defendant on 31.03.2018 at 01.13 PM.
                                                                                    G
         7. Despite the full awareness and knowledge as far back as
30.03.2018 and refund through RTGS of Rs.2.16 crores on 31.03.2018
itself, the plaintiff published a public notice only on 03.04.2018 advising
all concerned not to deal with the property which was duly replied and
refuted by another public notice dated 04.04.2018 published by the
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322             SUPREME COURT REPORTS                            [2020] 1 S.C.R.


A     defendants. The cause of action in the suit is based on the email dated
      30.03.2018 coupled with the public notice dated 03.04.2018.
      Acknowledging the refund also on 31.03.2018, it admits the signing of a
      registered agreement for sale with defendant no.2 on 31.03.2018 but
      does not make even a whisper of a suggestion why the suit was filed
      more than 7 months later. In commercial dealings with high stake matters
B
      delay is vital. This specific objection on behalf of the defendant taken
      before the High Court relying on K.S. Vidyanadam & ors. vs. Vairavan,
      1997 (3) SCC 1, has been noticed at paragraph 37 of the judgment but
      does not find any consideration.
             8. Reliance was also placed on Mandali Ranganna and ors. vs.
C     T. Ramachandra and ors., 2008 (11) SCC 1 to submit that the grant of
      the injunction was contrary to the basic principles governing injunction
      more so in a suit for specific performance relying on Mayawanti vs.
      Kaushalya Devi, 1990 (3) SCC 1.
             9. Shri Huzefa Ahmadi, learned senior counsel appearing on behalf
D     of defendant no.2, submitted that it was a bona fide purchaser for value.
      The plaintiff was well aware of the simultaneous negotiations with it.
      The defendant no.2 had made substantial payments on 30.03.2018 only
      after obtaining a written confirmation from the defendant dated
      26.03.2018 that it had not signed any other agreement or received payment
E     from another with regard to the subject lands. The registered agreement
      for sale dated 31.03.2018 was followed by delivery of possession much
      prior to the institution of the suit. A specific objection with regard to
      delay was taken in the reply to the injunction application which was not
      considered.

F            10. Dr. A.M. Singhvi, learned senior counsel appearing on behalf
      of the plaintiff, submitted that his clients at no stage had declined to meet
      the Income Tax liabilities of the defendant sister concerns, as part of the
      consideration amount. The negotiations were widespread over time both
      by WhatsApp messages and exchange of e-mails. These collectively
      have correctly been interpreted to hold a prima facie case in favour of
G     the plaintiff. The terms and conditions of payment, were all finalized
      which prima facie reflect the existence of a concluded contract. The
      fact that the e-mail dated 30.03.2018 referred to the enclosure as a draft
      MoU cannot be decisive as it has to be understood on a cumulative
      assessment of facts. In any event, the plaintiff had communicated its
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          AMBALAL SARABHAI ENTERPRISE LTD. v.                                    323
         KS INFRASPACE LLP LTD. [NAVIN SINHA, J.]

acceptance without delay and also protested the refund of the advance            A
of Rs.2.16 crores the same day followed by a public notice.
       11. The hurried manner in which the defendants proceeded to
finalise the deal on 30.03.2018 itself, manifests the desire of the defendants
to cause harm to the plaintiff. Defendant no.2 cannot claim to be a bona
fide purchaser as it was all along aware of the negotiations taking place        B
between the plaintiff and the defendant sister concerns and that it was
at a very advanced stage.
       12. Dr. Singhvi framed the question, whether concurrent findings
of the Special Civil Judge and the High Court by two detailed well
considered orders were such as to warrant interference so as to dissipate        C
the substratum of the suit. In support of his submissions, Dr. Singhvi
relied on Wander Ltd. and another vs. Antox India P. Ltd., 1990 Suppl.
SCC 727, Brij Mohan and others vs. Sugra Begum and ors., (1990)
4 SCC 147, Motilal Jain vs. Ramdasi Devi (Smt.) and ors., (2000) 6
SCC 420, Moharwal Khewaji Trust (Regd.), Faridkot vs. Baldev
Dass, (2004) 8 SCC 488, and Aloka Bose vs. Parmatma Devi and                     D
ors., (2009) 2 SCC 582.
      13. On the aspect of the delay in institution of the suit, relying on
Mademsetty Satyanarayana vs. G. Yelloji Rao and ors., 1965 (2)
SCR 221, it was submitted that the delay did not induce the defendant to
do anything further than that already done earlier, to their prejudice. In       E
any event the plaintiff is ready and willing to pay to the defendant no.2
the amount of the Income Tax dues paid by it and proceed with the
contract with the defendant sister concerns.
       14. We have been addressed by the counsel for the parties at
length, as also have been taken through the several WhatsApp messages            F
and e-mails exchanged. We have also considered the respective
submissions. Litigation at the initial stage of injunction, where the claims
of the parties are still at a nebulous stage, has stalled the progress of the
suit. We are of the considered opinion that at this stage we ought to
refrain from returning findings of facts or express any opinion on the           G
merits of the suit, except to the extent necessary for purposes of the
present order, so as not to prejudice either party in the suit.
      15. Chapter VII, Section 36 of the Specific Relief Act, 1963
(hereinafter referred to as ‘the Act’) provides for grant of preventive
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324            SUPREME COURT REPORTS                            [2020] 1 S.C.R.


A     relief. Section 37 provides that temporary injunction in a suit shall be
      regulated by the Code of Civil Procedure. The grant of relief in a suit for
      specific performance is itself a discretionary remedy. A plaintiff seeking
      temporary injunction in a suit for specific performance will therefore
      have to establish a strong prima-facie case on basis of undisputed facts.
      The conduct of the plaintiff will also be a very relevant consideration for
B
      purposes of injunction. The discretion at this stage has to be exercised
      judiciously and not arbitrarily.
            16. The cardinal principles for grant of temporary injunction were
      considered in Dalpat Kumar vs. Prahlad Singh, (1992) 1 SCC 719,
      observing as follows :
C
            “5…Satisfaction that there is a prima facie case by itself is not
            sufficient to grant injunction. The Court further has to satisfy that
            non-interference by the Court would result in “irreparable injury”
            to the party seeking relief and that there is no other remedy
            available to the party except one to grant injunction and he needs
D           protection from the consequences of apprehended injury or
            dispossession. Irreparable injury, however, does not mean that
            there must be no physical possibility of repairing the injury, but
            means only that the injury must be a material one, namely one
            that cannot be adequately compensated by way of damages. The
E           third condition also is that “the balance of convenience” must be
            in favour of granting injunction. The Court while granting or
            refusing to grant injunction should exercise sound judicial discretion
            to find the amount of substantial mischief or injury which is likely
            to be caused to the parties, if the injunction is refused and compare
            it with that which is likely to be caused to the other side if the
F           injunction is granted. If on weighing competing possibilities or
            probabilities of likelihood of injury and if the Court considers that
            pending the suit, the subject matter should be maintained in status
            quo, an injunction would be issued. Thus the Court has to exercise
            its sound judicial discretion in granting or refusing the relief of ad
G           interim injunction pending the suit.”
            17. The negotiations between the plaintiff and the defendant is
      reflected in approximately 17 e-mails exchanged between them
      commencing from December 2017 to 31.03.2018. The file size of the
      attachment to the mails has varied from 48-50-52-48-57-56 KBs
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          AMBALAL SARABHAI ENTERPRISE LTD. v.                                   325
         KS INFRASPACE LLP LTD. [NAVIN SINHA, J.]

indicating suggestions and corrections from time to time. The WhatsApp          A
messages which are virtual verbal communications are matters of
evidence with regard to their meaning and its contents to be proved
during trial by evidence-in-chief and cross examination. The e-mails and
WhatsApp messages will have to be read and understood cumulatively
to decipher whether there was a concluded contract or not. The use of
                                                                                B
the words ‘final draft’ in the e-mail dated 30.03.2018 cannot be
determinative by itself. The e-mail dated 26.02.2018 sent by the defendant
at 11:46 AM had also used the same phraseology. The plaintiff was well
aware from the very inception that the defendant was negotiating for
sale of the lands simultaneously with two others. The plaintiff was further
aware on 30.03.2018 itself that the deal with it had virtually fallen through   C
as informed to the escrow agent. The fact that a draft MoU christened
as ‘final-for discussion’ was sent the same day cannot lead to the
inference in isolation, of a concluded contract. There is no evidence at
this stage that the acceptance was communicated to the defendant before
the latter entered into a deal with defendant no.2 on 30.03.2018 and
                                                                                D
executed a registered agreement for sale on 31.03.2018. Defendant no.2
paid Rs.17.69 crores and Rs.2.20 crores towards the income tax dues
of the defendant the same day, as part of the consideration amount. It is
only thereafter the plaintiff purports to have communicated its acceptance
to the defendant on 31.03.2018 at 01.13 PM. The prolonged negotiations
between the parties reflect that matters were still at the ‘embryo stage’       E
as observed in Agriculture Produce Market Committee, Gondal
and ors. vs. Girdharbhai Ramjibhai Chhaniyara and ors., (1997) 5
SCC 468. The plaintiff at this stage has failed to establish that there was
a mutuality between the parties much less that they were ad-idem.
       18. The pleadings in the suit acknowledge the awareness of the           F
plaintiff of the ongoing negotiations with defendant no.2. The advance
of Rs.2.16 crores was refunded to the plaintiff in the evening on
31.03.2018 by RTGS. No effort was made by the plaintiff to again remit
the sum by RTGS immediately or the next day. Only a public notice was
published on 03.04.2018 refuted by the defendant on 04.03.2018. The
suit was then filed seven months later on 01.10.2018. The explanation           G
that the plaintiff waited hopefully for a solution outside litigation as a
prudent businessman before finally instituting the suit is too lame an
excuse to merit any consideration.

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326             SUPREME COURT REPORTS                           [2020] 1 S.C.R.


A            19. In a matter concerning grant of injunction, apart from the
      existence of a prima facie case, balance of convenience, irreparable
      injury, the conduct of the party seeking the equitable relief of injunction
      is also very essential to be considered as observed in Motilal Jain
      (supra) holding as follows :
B           “6. The first ground which the High Court took note of is the
            delay in filing the suit. It may be apt to bear in mind the following
            aspects of delay which are relevant in a case of specific
            performance of contract for sale of immovable property:
            (i) delay running beyond the period prescribed under the Limitation
C           Act;
            (ii) delay in cases where though the suit is within the period of
            limitation, yet:
            (a) due to delay the third parties have acquired rights in the subject-
            matter of the suit;
D
            (b) in the facts and circumstances of the case, delay may give
            rise to plea of waiver or otherwise it will be inequitable to grant a
            discretionary relief.”
             20. The defendant no.2, in addition to the dues of the Income Tax
      department as aforesaid, made further payments to the defendant of
E
      Rs.25,44,57,769/- by 16.01.2019 aggregating to a total payment of
      Rs.45,84,71,869/-. The defendants had also proceeded to utilize a sum
      of Rs.36.20 crores also and had therefore materially altered their position
      evidently by the inaction of the plaintiff to institute the suit in time and
      having allowed third party rights to accrue by making substantial
F     investments. In Madamsetty (supra) it was observed :
            “12…..It is not possible or desirable to lay down the circumstances
            under which a court can exercise its discretion against the plaintiff.
            But they must be such that the representation by conduct or neglect
            of the plaintiff is directly responsible in inducing the defendant to
G           change his position to his prejudice or such as to bring about a
            situation when it would be inequitable to give him such a relief.”
      Similar view has been expressed in Mandali Ranganna (supra).
            21. We are therefore of the considered opinion that in the facts
      and circumstances of the present case, and the nature of the materials
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          AMBALAL SARABHAI ENTERPRISE LTD. v.                                 327
         KS INFRASPACE LLP LTD. [NAVIN SINHA, J.]

placed before us at this stage, whether there existed a concluded contract    A
between the parties or not, is itself a matter for trial to be decided on
basis of the evidence that may be led. If the plaintiff contended a
concluded contract and/or an oral contract by inference, leaving an
executed document as a mere formality, the onus lay on the plaintiff to
demonstrate that the parties were ad-idem having discharged their
                                                                              B
obligations as observed in Brij Mohan (supra). The plaintiff failed to do
show the same on admitted facts. The draft MoU dated 30.03.2018 in
Clause C contemplated payment of the income tax dues of Rs.18.64
crores as part of the consideration amount only whereafter the agreement
was to be signed relating back to the date 29.03.2008. Had this amount
been already paid or remitted by the plaintiff, entirely different            C
considerations would have arisen with regard to the requirement for
execution of a written agreement remaining a mere formality. Needless
to state the balance of convenience is in favour of the defendants on
account of the intervening developments, without furthermore, inter-
alia by reason of the plaintiff having waited for seven months to institute
                                                                              D
the suit. The question of irreparable harm to a party complaining of a
breach of contract does not arise if other remedies are available to the
party complaining of the breach. The High Court has itself observed
that from the negotiations between the parties that “some rough weather
was being reflected between the plaintiff and the defendant ……….”.
The Special Civil Judge failed to address the issue of delay. The High        E
Court noticed the arguments of the defendants with regard to delay in
the institution of the suit but failed to deal with it.
      22. In M.P. Mathur vs. DTC, (2006) 13 SCC 706, this Court
observed :
      “14. The present suit is based on equity…In the present case, the       F
      plaintiffs have sought a remedy which is discretionary. They have
      instituted the suit under Section 34 of the 1963 Act. The discretion
      which the court has to exercise is a judicial discretion. That
      discretion has to be exercised on well-settled principles. Therefore,
      the court has to consider—the nature of obligation in respect of        G
      which performance is sought, circumstances under which the
      decision came to be made, the conduct of the parties and the
      effect of the court granting the decree. In such cases, the court
      has to look at the contract. The court has to ascertain whether
      there exists an element of mutuality in the contract. If there is
                                                                              H
328             SUPREME COURT REPORTS                            [2020] 1 S.C.R.


A            absence of mutuality the court will not exercise discretion in favour
             of the plaintiffs. Even if, want of mutuality is regarded as
             discretionary and not as an absolute bar to specific performance,
             the court has to consider the entire conduct of the parties in relation
             to the subject-matter and in case of any disqualifying circumstances
             the court will not grant the relief prayed for (Snell’s Equity, 31st
B
             Edn., p. 366)….”
            23. Wander Ltd. (supra) prescribes a rule of prudence only. Much
      will depend on the facts of a case. It fell for consideration again in
      Gujarat Bottling Co. Ltd. vs. Coca Cola Co., (1995) 5 SCC 545,
      observing as follows :
C
             “47….Under Order 39 of the Code of Civil Procedure, jurisdiction
             of the Court to interfere with an order of interlocutory or temporary
             injunction is purely equitable and, therefore, the Court, on being
             approached, will, apart from other considerations, also look to the
             conduct of the party invoking the jurisdiction of the Court, and
D            may refuse to interfere unless his conduct was free from blame.
             Since the relief is wholly equitable in nature, the party invoking
             the jurisdiction of the Court has to show that he himself was not
             at fault and that he himself was not responsible for bringing about
             the state of things complained of and that he was not unfair or
E            inequitable in his dealings with the party against whom he was
             seeking relief. His conduct should be fair and honest….”
              24. The aforesaid discussion leaves us satisfied to conclude that
      in the facts and circumstances of the present case, the grant of injunction
      to the plaintiff is unsustainable. Resultantly the orders of injunction are
F     set aside. Nothing in the present order shall be deemed or construed as
      any expression of opinion or observation by us at the final hearing of the
      suit which naturally will have to be decided on its own merits. The High
      Court has already given directions to expedite the hearing of the suit and
      we reiterate the same.

G            25. The appeals are allowed.

      Kalpana K. Tripathy                                            Appeals allowed.




H