Manohar Lal Chopra vs Rai Bahadur Rao Raja Seth Hiralal

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 346 of 1958

Decision Date: 16 November, 1961

Coram: Raghubar Dayal, K.N. Wanchoo, K.C. Das Gupta, J.C. Shah

Manohar Lal Chopra filed a suit at Asansol against Rai Bahadur Rao Raja Seth Hiralal for the recovery of money, and the suit was recorded on 16 November 1961. The same day, the parties’ names appeared again as the caption of the case in the records of the Supreme Court of India. The judgment was authored by Justice Raghubar Dayal, and the bench comprised Justices Raghubar Dayal, K.N. Wanchoo, K.C. Das Gupta and J.C. Shah. The petitioner was identified as Manohar Lal Chopra and the respondent as Rai Bahadur Rao Raja Seth Hiralal. The date of the judgment was 16 November 1961. The citation of the decision was reported as 1962 AIR 527 and 1962 SCR Supl. (1) 450, with subsequent citing references listed as F 1965 SC 1144 (6), R 1966 SC 1899 (5), F 1983 SC 1272 (21), R 1986 SC 421 (34). The case involved the question of inherent powers of courts to grant a temporary injunction restraining a party from proceeding with a suit in another state, and it engaged provisions of the Code of Civil Procedure 1908, particularly sections 94(c) and 151, together with Order 39, Rule 1. In the factual background, after the Asansol suit was filed, Hiralal filed a counter‑suit at Indore seeking recovery of money from Chopra. Hiralal then raised a defence in the Asansol proceedings, contending that the Asansol court lacked jurisdiction. He applied to the Asansol court for a stay of the suit, but the court refused his request. An appeal against that refusal was made to the Calcutta High Court, which dismissed the appeal and directed that the preliminary jurisdictional issue be decided by the trial court without delay. Following that direction, Hiralal applied to the Indore court for an injunction intended to restrain Chopra from proceeding with the Asansol suit pending resolution of the Indore counter‑suit. The Indore court, invoking Order 39 of the Code of Civil Procedure, granted the injunction. Chopra subsequently appealed to the Madhya Bharat High Court, which set aside the injunction. The High Court held that Order 39 was not applicable to the circumstances, but that the injunction could be issued under the inherent powers of the court derived from section 151 of the Code.

The Supreme Court then examined whether the injunction had been correctly granted. The Court observed that civil courts possessed inherent authority to issue temporary injunctions in situations not covered by Order 39, and that the Code of Civil Procedure was not exhaustive in its provisions. It noted that section 94 did not forbid the grant of a temporary injunction where Order 39 was inapplicable. However, the Court emphasized that inherent powers must not be exercised in conflict with the express provisions of the Code or against the intention of the legislature, and that such powers should be used only in very exceptional circumstances. The Court further explained that a plaintiff could be restrained from pursuing a suit in another jurisdiction only when that suit was vexatious and useless, which was not the case here. Consequently, the Court held that the issue of jurisdiction should be determined by the Asansol court, as directed by the Calcutta High Court, and that the Indore court was not competent to decide that issue. The order granting the injunction was therefore declared wrongly granted and ordered to be vacated.

The Court observed that the Asansol court possessed the discretion to disregard the order issued by the Indore court and to continue with the suit that was pending before it. If the Asansol court were to act in that manner, it would place the party identified as M in a position that the Court described as impossible, because a judicial order should not create a circumstance that defeats the purpose of justice. The Court then examined a series of earlier decisions. It noted that the cases Varadacharlu v. Narsimha Charlu (A.I.R. 1926 Mad. 258), Govindarajalu v. Imperial Bank of India (A.I.R. 1932 Mad. 180), Karuppayya v. Ponnuswami (A.I.R. 1933 Mad. 500(2)), Murugesa Mudali v. Angamuthu Madali (A.I.R. 1938 Mad. 190) and Subramanian v. Seetarama (A.I.R. 1940 Mad. 104) were not approved for the proposition under consideration. By contrast, the Court approved the authority of Dhaneshwar Nath v. Ghanshyam Dhar (A.I.R. 1940 All. 185), Firm Richchha Ram v. Firm Baldeo Sahai (A.I.R. 1940 All. 241), Bhagat Singh v. Jagbir Sawhney (A.I.R. 1941 Cal. 670) and Chinese Tannery Owners’ Association v. Makhan Lal (A.I.R. 1952 Cal. 550). Additionally, the Court relied upon Padam Sen v. State of U.P. [1961] 1 S.C.R. 884, Cohen v. Rothfield (L.R. [1919] 1 K.B. 410) and Hyman v. Helm (L.R. (1883) 24 Ch. D. 531) in forming its view.

Justice Shah, speaking for the Court, reiterated that civil courts do not possess an inherent power to grant injunctions in matters that fall outside Order 39, Rules 1 and 2 of the Code of Civil Procedure. The jurisdiction to grant injunctions to civil courts, apart from the Chartered High Courts, must be sourced from the explicit provisions of Section 94 of the Code and from Order 39, Rules 1 and 2. The Court emphasized that where the Code contains a specific provision intended to address a particular situation, that provision must be applied strictly, and any departure from it is impermissible. When the Code addresses a subject matter expressly, the rule should ordinarily be regarded as exhaustive. The Court again cited Padam Sen v. State of U.P. [1961] 1 S.C.R. 884 to support this principle.

The judgment proceeded to set out the procedural background of the appeal. The case fell within the civil appellate jurisdiction and was titled Civil Appeal No. 346 of 1958. It was filed by special leave against the judgment and order dated 10 May 1955 pronounced by the former Madhya Bharat High Court in Miscellaneous Appeal No. 26 of 1954. Counsel for the appellant comprised S. N. Andley, Rameshwar Nath and P. L. Vohra, while counsel for the respondent were S. T. Desai, K. B. Bhatt and B. R. L. Iyengar. The judgment was delivered on 16 November 1961. The original judgment of the bench consisting of Justices Wanchoo, Das Gupta and Dayal was delivered by Justice Dayal, with Justice Shah delivering a separate opinion. The factual matrix involved a partnership formed at Indore between the appellant and the respondent for the purpose of operating coal mines at Kajora gram in Burdwan district and for manufacturing cement under the name “Diamond Industries.” The partnership’s head office was situated at Indore. The partnership was subsequently dissolved by a deed of dissolution dated 22 August 1945. Under the terms of that deed, the appellant undertook to render a full, correct and true account of all monies advanced by the respondent and to produce the accounts of the partnership and its business. In consideration, the appellant was entitled to a quarter of the Rs 4,00,000 contributed by the respondent as capital, but this entitlement was conditioned upon the appellant first furnishing the accounts and having them examined and audited. The second proviso at the end of the deed stipulated further obligations, which were to be addressed in the subsequent portions of the proceedings.

The deed of dissolution contained a specific provision which stipulated that “Provided however and it is agreed by and between the parties that as the parties entered into the partnership agreement at Indore (Holker State) all disputes and differences whether regarding money or as to the relationship or as to their rights and liabilities of the parties hereto in respect of the partnership hereby dissolved or in respect of question arising by and under this document shall be decided amicably or in court at Indore and at nowhere else.” Accordingly, on 29 September 1945 a registered letter was sent by the respondent to the appellant. The letter demanded that the appellant, within three months of receiving the notice, explain the accounts of the colliery to the respondent in Indore and satisfy the respondent that the accounts were correct. The notice alleged that the accounts previously submitted by the appellant had been improperly kept, that many entries appeared to have been deliberately falsified with malicious intent, and that the account books contained false and fictitious entries which caused loss to the respondent and an improper gain to the appellant. In response, the appellant wrote a reply dated 5 December 1935 in which he rejected all the allegations made in the notice and invited the respondent to meet him either at Asansol or at Kajoraram on any day convenient to the respondent, proposing that the meeting take place within ten days of receipt of the appellant’s letter. Several years later, on 18 August 1948, the appellant commenced Suit M. S. No. 33 of 1948 before the Subordinate Judge at Asansol, seeking recovery of Rs 1,00,000 as his share in the capital and assets of the partnership firm “Diamond Industries” and additionally claiming Rs 18,000 as interest on the detained sum, or alternatively as damages or compensation for the alleged wrongful withholding of the payment. In the plaint the appellant referred to the respondent’s notice, his own reply, a second letter sent by the respondent and the appellant’s subsequent reply. He also asserted that a copy of the deed of dissolution had been annexed to the plaint, as indicated in paragraph 13 of his filing. The respondent, on 27 October 1948, moved the Asansol Court for a stay of the suit by filing a petition under section 34 of the Arbitration Act, relying on the arbitration clause contained in the original partnership deed. That application was dismissed on 20 August 1949. Meanwhile, on 3 January 1949, the respondent instituted Civil Original Suit No. 71 of 1949 before the District Judge of Indore, claiming a decree for Rs 1,90,519‑0‑6 against the appellant, together with interest on the basis of settled accounts, and alternatively seeking a decree directing the appellant to render true and full accounts of the partnership. The respondent filed his written statement in the Asansol Court on 28 November 1949. In that written statement, paragraph 19 dealt with the allegations in paragraph 21 of the plaint, and paragraph 21 denied that the plaintiff possessed any cause of action, asserting that the dispute fell within the arbitration agreement that required the matter to be decided at Indore and consequently contending that the Asansol Court lacked jurisdiction to entertain the suit.

In the plaintiff’s complaint it was alleged that the defendant owed a cause of action arising at Kajora Colliery, an allegation which the defendant denied, asserting that no such cause existed. The defendant then requested that the deed of dissolution be considered, a deed in which both parties had agreed that any dispute, should one arise, would be tried in the Court at Indore. On the basis of that agreement, the defendant submitted that the present Court lacked jurisdiction to try or entertain the suit. In a separate paragraph the defendant described the suit as vexatious, speculative and oppressive, characterising it as being instituted in bad faith and seeking its dismissal together with an order for costs. The court subsequently framed two preliminary issues on 4 February 1950. The first issue asked whether this Court possessed jurisdiction to entertain and try the suit, and the second issue asked whether the plaintiff had rendered the partnership accounts and explained them satisfactorily in accordance with the terms of the deed of dissolution of the partnership. In December 1951 the respondent applied to the Asansol Court for a stay of the suit, invoking the Court’s inherent powers. That application was rejected on 9 August 1952. The learned Sub‑Judge observed that a lawful act or proceeding carried out as a matter of right cannot be characterized as an abuse of process merely because it may cause inconvenience to the other party. Accordingly, the Sub‑Judge held that there was no basis for invoking section 151 of the Code of Civil Procedure, since section 10 of the Code could not be applied to the suit, the suit having been instituted before the suit pending in Indore. The High Court of Calcutta affirmed this order on 7 May 1953, expressing that, based on the circumstances and the material on record, the orders should not be revisited, and refraining from further comment so as not to prejudice either party. The High Court also directed that, because the first preliminary issue in the two Asansol suits had been pending for more than two years, the issues should be heard without further delay, ordering the learned Subordinate Judge to take immediate steps to expedite the hearing. Turning to the parallel proceedings in Indore, on 28 April 1950 the appellant sought a stay of the Asansol suit by invoking sections 10 and 151 of the Code of Civil Procedure before the Indore Court. The respondent opposed this application on three grounds. First, the respondent argued that the deed of dissolution expressly provided that only the Court at Indore could adjudicate any disputes, thereby excluding the Asansol Court from jurisdiction. Second, the respondent contended that, under the Civil Procedure Code then applicable in Madhya Bharat, the Asansol Court was not an internal Court and therefore could not stay proceedings in a suit filed elsewhere. Third, the respondent maintained that the two suits were of a different character, having distinct subjects and reliefs sought, and therefore could not be treated as the same proceeding.

In this case, the Court noted that the subject matter and the relief claimed in the two suits were different. The application filed on April 28, 1950 in the Indore Court seeking a stay of the suit under sections 10 and 151 of the Code of Civil Procedure was dismissed on July 5, 1951. The decision was based principally on the second proviso contained in the deed of dissolution. The High Court of Madhya Bharat affirmed that dismissal on August 20, 1953. Consequently, after that date both suits were to proceed, and the Asansol Court was instructed to adjudicate the question of jurisdiction at an early stage. On September 14, 1953 the respondent filed an application under section 151 of the Code of Civil Procedure in the Indore Court, requesting that the appellant be restrained from continuing the proceedings he had instituted in the Asansol Court. The respondent alleged that the appellant had filed the Asansol suit merely to cause him inconvenience, to impose heavy expenses, and to waste his time, and that the appellant was taking steps to perpetuate the suit before the Subordinate Judge of Asansol. The appellant opposed this application, asserting that he was fully entitled to institute the suit in Asansol, that the Asansol Court possessed jurisdiction to try the matter, and that the earlier objections raised by the respondent had been overruled. He further contended that the respondent’s request for a stay of the Asansol proceedings had been rejected by that Court, and he denied that his intention in filing the suit was to create trouble or impose costs on the respondent. It was observed that the respondent’s application did not mention that his request for a stay of the Asansol suit had been finally dismissed by the High Court of Calcutta, nor that that Court had directed the trial court to resolve the jurisdictional issue promptly. Likewise, the appellant’s objection failed to specifically state that the order dismissing the respondent’s stay application had been confirmed by the High Court at Calcutta and that an early hearing on jurisdiction had been ordered. The learned Additional District Judge of Indore then granted an interim injunction under Order XXXIX of the Code of Civil Procedure, restraining the appellant from proceeding with his Asansol suit until the Indore suit was decided, on the ground that the appellant was persisting with the Asansol suit despite the rejection of his own application for a stay of the Indore suit, and that his conduct appeared intended to violate the deed of dissolution which designated the Indore Court as the proper forum for resolving the dispute. The appellant appealed this injunction to the High Court of Judicature at Madhya Bharat, arguing that the Additional District Judge was not authorised to issue such an interim injunction under Order XXXIX of the Code of Civil Procedure, and that the matter was suitable for the exercise of the Court’s inherent powers under section 151 of the Code.

The High Court had dismissed the appellant’s appeal by an order dated 10 May 1955. The learned judges agreed with the contention that Order XXXIX, Rule 1 did not apply to the facts of the case. Nevertheless, they held that an injunction could be granted by exercising the Court’s inherent powers under section 151 of the Civil Procedure Code. The appellant sought special leave to challenge that order. On behalf of the appellant, two principal questions were framed for consideration. The first question asked whether the Court could exercise its inherent jurisdiction when the Code contained specific provisions for granting interim injunctions, namely sections 94 and Order XXXIX. The second question concerned whether, in exercising its inherent jurisdiction, the Court had exercised its discretion properly in view of the facts of the case. A third point that arose during the hearing related to the legal effect of the second proviso in the deed of dissolution on the maintainability of the suit pending in the Asansol Court. The Court indicated that it would not express an opinion on that jurisdictional issue, noting that it was a matter still pending in both the Asansol suit and the Indore suit and therefore not yet decided.

The appellant argued on the first question that clause (c) of section 94 of the Civil Procedure Code made it clear that interim injunctions could be issued only when a provision for their issue was made under the rules, because the section provides that a Court may, if it is so prescribed, grant temporary injunctions to prevent the ends of justice from being defeated. The appellant further submitted that the term “prescribed”, as defined in section 2, meant “prescribed by rules”, and that Rules 1 and 2 of Order XXXIX set out certain circumstances in which a temporary injunction may be issued. The High Court was divided on this point. One view, supported by the authorities Varadacharlu v. Narsimha Charlu (1), Govindarajulu v. Imperial Bank of India (2), Karuppayya v. Ponnuswami (3), Murugesa Mudali v. Angamuthu Mudali (4) and Subramanian v. Seetarama (5), held that a Court could not grant a temporary injunction if the circumstances did not fall within the provisions of Order XXXIX. The opposite view, relying on Dhaneshwar Nath v. Ghanshyam Dhar (6), Firm Bichchha Ram v. Firm Baldeo Sahai (7), Bhagat Singh v. Jagbir Sawhney (8) and Chinese Tannery Owners’ Association v. Makhan Lal (9), held that a Court could issue an interim injunction in situations not covered by Order XXXIX where the Court was of the opinion that the interests of justice required such an injunction. The Court concluded, “We are of opinion”.

The Court affirmed that the second view is the correct one and that the Courts possess an inherent jurisdiction to grant temporary injunctions even when the circumstances fall outside the specific provisions of Order XXXIX of the Code of Civil Procedure. Section 94 of the Code contains no expression that expressly bars the issuance of a temporary injunction in situations not covered by Order XXXIX or by any rules made under the Code. It is well‑settled that the Code’s provisions are not exhaustive, because the Legislature cannot anticipate every possible scenario that may arise in future litigation and therefore cannot prescribe procedural measures for every eventuality. The phrase “if it is so prescribed” merely indicates that when the rules delineate the circumstances in which a temporary injunction may be granted, the Court ordinarily should not invoke its inherent powers but should first determine whether the facts of the case fall within the prescribed rule. Even if section 94 were absent from the Code, the Court would still be able to grant temporary injunctions, but such orders would then be exercised solely under its inherent jurisdiction. No litigant possesses a right to compel the Court to exercise that jurisdiction; the Court will invoke its inherent power only when it deems it absolutely necessary to achieve justice. Consequently, the effect of section 94 is realised in the very act of exercising the power to issue a temporary injunction, not in any restriction that would remove the Court’s inherent authority. Order XXXIX, rules 1 and 2, do not specifically state that a temporary injunction must not be granted in cases not enumerated in those rules; rather, the rules simply provide that in the circumstances they mention, the Court may grant such an injunction.

The provisions of section 151 of the Code further clarify that the Court’s inherent powers are not limited by the Code’s statutory framework. Section 151 reads: “Nothing in this Code shall be deemed to limit or otherwise affect the inherent power of the Court to make such orders as may be necessary for the ends of justice or to prevent abuse of the process of the Court.” A comparable issue regarding the Court’s power to appoint a commission under its inherent authority, in circumstances not covered by section 75 and Order XXVI, arose in Padam Sen v. State of Uttar Pradesh. In that case, the Court held that it could issue a commission even where the statutory provisions did not expressly provide for it, and observed at page 887: “The inherent powers of the Court are in addition to the powers specifically conferred on the Court by the Code. They are complementary to those powers and therefore it must be held that the”.

The Court explained that it may employ the inherent powers described in section 151 of the Code when the purpose stated in that section is pursued, provided that the use of those powers does not conflict in any way with any provision that is expressly laid down in the Code or with the intention of the Legislature. By making this observation, the Court clarified that the inherent powers are not subordinate to the Code; they exist independently as the Code itself declares in section 151. However, the Court also stressed that these powers must not be exercised where their use would be at odds with an express provision of the Code or would run counter to the legislative intent. This limitation is practical rather than doctrinal; it does not arise because the Code controls the inherent powers, but because it is presumed that the Legislature has set out a specific procedure for certain orders that reflects the interests of justice. In the case presently before the Court, the Supreme Court did not affirm a decision of the Civil Court that fell outside the scope of Order XXVI and that had appointed a commissioner to seize the plaintiff’s account books on an application filed by the defendants. The Court held that the order was defective, not on the ground that the Court lacked authority to appoint a commissioner in situations not covered by section 75 and Order XXVI, but because the power was used to address a matter that affected the substantive rights of the plaintiff rather than a procedural issue.

The Court further explained that the key question was whether the order of the Additional Munsif, which appointed Shri Raghubir Pershad as Commissioner to seize the plaintiff’s books of account, could be characterized as an order made in the exercise of the Court’s inherent powers. It observed that the inherent powers preserved by section 151 relate solely to the procedure that the Court must follow in determining a case. These powers do not extend to the substantive rights that any litigant possesses. The Court noted that specific statutory authority must be granted to a court before it can pass orders that affect a party’s substantive rights, and such authority cannot be derived from the inherent powers that are limited to procedural regulation. The Court added that the source of the procedural powers lies in the Court’s complete authority to manage its own practice and procedure. In a separate decision reported as Maqbul Ahmad v. Pratap Narain Singh, the Court clarified that the inherent powers are not governed by the Code’s provisions. That judgment held that a limited statutory discretion conferred on a court by an Act does not translate into a general discretion to ignore the Act’s provisions. In the cited case, the decree‑holder filed an application for preparation of a final decree after the period prescribed by the limitation law, and the Court rejected the argument that the court could, on grounds of hardship, dispense with the limitation statute.

In this case, it was argued that the Court possessed a form of judicial discretion that could allow it to free the decree‑holder from the operation of the Limitation Act where hardship was shown. The Court rejected that argument by referring to its earlier observation on page 87, which stated that there was no authority supporting such a proposition. The Court explained that, in a matter governed by an Act that grants the Court statutory discretion only in limited respects, it is impossible to imply a general discretion for the Court to disregard the provisions of that Act beyond the limits expressly set by the statute. The Court further noted that section 3 of the Limitation Act is peremptory and that the Court has a duty to notice the Act and give effect to its provisions even when the Act is not mentioned in the pleadings. These comments, however, were held not to affect the issue of whether the Court could invoke its inherent powers under section 151 of the Code of Civil Procedure. Section 151 expressly provides that nothing in the Code shall be deemed to limit or otherwise affect the inherent power of the Court to make such orders as are necessary for the ends of justice. Consequently, the Court said that the clear language of that provision prevents any conclusion that the Code’s provisions restrict or modify the inherent power. The Court emphasized that the inherent power is not a power conferred by statute but a power that exists by virtue of the Court’s duty to administer justice between the parties before it. Because the Code itself acknowledges the existence of such inherent power, there is no need to imply any additional powers beyond what the Code contemplates. Accordingly, the Court rejected the first contention raised on behalf of the appellant. Turning to the second issue, the Court expressed the view that, on the facts, the lower courts had erred in granting a temporary injunction that barred the appellant from proceeding with his suit in the Asansol Court. The Court observed that the exercise of inherent powers is reserved for very exceptional circumstances, and the Code does not prescribe a specific procedure for such use. The Court stressed that ordering a party not to pursue any other suit in a regularly constituted court requires great caution and should be done only when absolutely necessary to achieve justice. In support of this approach, the Court referred to the principles set out in Cohen v Rothfield, which has influenced Indian courts on the issue of granting injunctions that restrain litigation in other jurisdictions. In that authority, Scrutton, L.J., observed at page 413 that when a court is asked to stay an action on the ground that another action is pending, and the action to be stayed is not before the court that is being asked to make the order, the result is effectively to restrain the person bringing the second action from proceeding. He warned that because such a restraint interferes with proceedings in another jurisdiction, the power must be exercised with great caution to avoid any appearance of undue interference. Further, at page 415, the same judgment noted that although there is jurisdiction to restrain a defendant from suing abroad, that jurisdiction is very rarely exercised and should be resorted to only with great care and upon the production of ample evidence that the foreign action is truly vexatious and useless.

In the passage cited from Cohen v. Rothfield, the Court explained that when a person who has filed a second action is restrained, the result is effectively the same as staying the first action, even though the order is made in a different Court. The Court warned that because such a restraint interferes with proceedings in another jurisdiction, it must be used with great caution to avoid even the appearance of undue interference with another Court. The judgment further observed, at page 415, that although a Court possesses the jurisdiction to prevent a defendant from suing abroad, that power is exercised only rarely and only when the applicant presents ample evidence that the foreign action is truly vexatious and useless. The same judgment set out the principle for a plaintiff who has already commenced a suit to obtain a restraining order against a later suit filed by the defendant. It stated that the plaintiff must satisfy the Court that the defendant cannot obtain any advantage by proceeding with the later action in another part of the King's dominions; otherwise the Court should not stop the defendant from pursuing the only proceedings that the defendant, as plaintiff, can control. The Court noted that this principle had been repeatedly applied. The injunction order that is the subject of the present dispute does not rest on any of those principles. In fact, the order was obtained by the defendant in the earlier suit against the plaintiff of that same suit, reversing the usual situation contemplated in the cited authority.

The Court then turned to the question of what makes a suit vexatious, referring to the decision in Hyman v. Helm. In that case, the defendant, while defending a claim before the Chancery Division of the High Court, instituted a separate action against the plaintiffs in San Francisco. The English plaintiffs sought a restraining order to prevent the defendants from continuing the San Francisco action, arguing that the action was vexatious because the witnesses were residents of England, the contract was English, and performance occurred in England. Lord Justice Brett, delivering the judgment at page 537, explained that an action could be deemed vexatious only if the Court found a proper ground for interference, not merely because the suit was filed in an inconvenient forum. He clarified that the burden of proof lay with the party requesting interference to demonstrate that the multiplicity of actions was indeed vexatious. Merely pointing out that multiple actions existed was insufficient; the applicant had to provide further evidence to satisfy the Court that the later suit was an abuse of process.

In the situation where the same plaintiff files two separate suits against the same defendant in England and both suits arise from the identical cause of action, the Court noted that, according to the earlier authority in Mchonry v. Lewis (22 Ch. D. 397) and the decision in the Peruvian Guano Company v. Bockwoldt (23 Ch. D. 225), such a circumstance is prima facie vexatious. Consequently, a complainant who points out the multiplicity of actions has, at the outset, established a prima facie basis for the Court to interfere. The Court further explained that when a plaintiff initiates a suit in England and the defendant files a cross‑action in the same jurisdiction, it becomes a more complex question whether the same prima facie finding of vexatiousness applies, and the Court expressed that it was not prepared to decide that the situation automatically met that threshold. The Court then observed that the issue of vexatiousness was being examined with reference to a later suit brought by the defendant after an earlier suit had already been commenced, and that the earlier plaintiff had sought a restraining order against the later plaintiff. The Court held that such a restraining order could not be justified on general principles when the earlier suit had already been filed in a court of competent jurisdiction. The Court below had upheld an injunction on the ground that the plaintiff in the Asansol Court relied on a deed of dissolution dated 22 1945 but deliberately omitted reference to the contractual provision that required disputes to be submitted to the Indore Courts. The lower Court described the Asansol filing as an anticipatory action taken in flagrant breach of the contract and characterised it as a misuse and abuse of the court’s process. The appellant had attached the deed of dissolution to the plaint filed in Asansol, yet he did not expressly mention the contractual proviso concerning the appropriate forum for dispute resolution. The Court observed that even if such a reference had been made, it would not have prevented the Asansol Court from entertaining the suit, because it was not contested that both the Indore and Asansol Courts possessed jurisdiction to try the matter despite the agreement. Moreover, the Court found no evidence that the appellant’s filing in Asansol was intended to anticipate a later suit in Indore, which was instituted only a few months afterwards. The record showed no indication that the appellant was aware, at the time of filing the Asansol suit, that the respondent was planning to commence a suit in Indore. The respondent’s notices to the appellant were dated December 1945, whereas the Asansol suit was filed in August 1948, more than two and a half years after the correspondence referred to in the plaint.

In this matter, the Court observed that the respondent’s decision to apply for an injunction in September 1953 demonstrated an abuse of the judicial process. The respondent applied for the injunction while fully aware of the Calcutta High Court’s order, which had confirmed the earlier ruling that refused to stay the suit filed at Asansol and had directed that the High Court decide the question of jurisdiction without delay. Knowing that the High Court had already instructed an early determination of the jurisdictional issue, the respondent nevertheless sought to impede the proceedings at Asansol. The Court noted that the respondent’s motive appeared to be to secure a rapid decision by the Asansol Court on the jurisdictional question, a decision that, if the Court found that it lacked jurisdiction under the terms of the deed of dissolution, would bring the Asansol suit to an end permanently. However, the respondent seemed to avoid allowing the Asansol Court to reach that conclusion and, instead of complying with the Calcutta High Court’s directive, filed the injunction application. The Court found it puzzling that the appellant did not expressly refer to the Calcutta High Court’s order in his objection to the injunction, a reference that might have caused the Indore Court to view the matter from a different perspective.

The Court further held that it was inappropriate to grant an injunction under section 151 of the Code of Civil Procedure on the ground that the deed of dissolution between the parties constituted a valid contract and that filing the suit at Asansol violated that contract. The question of whether the Asansol Court possessed jurisdiction over the subject matter of the suit was to be decided by the Asansol Court itself, and the Indore Court had no authority to determine that issue. Moreover, it was not the function of the Indore Court to enforce the contractual terms by preventing the appellant from filing a suit in any other forum. Enforcement of a breach of contract could be addressed only in a proper proceeding specifically dealing with that breach. For the purposes of the present appeal, the Court assumed that the jurisdiction of the Asansol Court was not removed by the proviso in the deed of dissolution, even though that proviso expressed the parties’ preference that disputes be resolved in the Indore Court. Consequently, the appellant retained the freedom to select the forum in which to commence his suit. He elected to file the suit in the Asansol Court, and the mere fact that this Court was located at a considerable distance from the respondent’s residence did not, on its own, establish that the suit was intended to cause the respondent inconvenience, harassment, or unnecessary expense. The Court emphasized that it is the court, not a party, that controls the conduct of the proceedings before it.

In this case, the Court observed that granting an injunction to a party with respect to his participation in the proceedings of the suit would place that party in an extremely inconvenient position. It was noted that the Asansol Court would not act in a manner that might put the appellant in a difficult situation and would demonstrate a spirit of cooperation with the Indore Court. However, the Court emphasized that orders are not ordinarily based on such considerations when there is any possibility that the other Court might not share the same view. The factual narration would show how each Court acted according to its own understanding of the legal position and the conduct of the parties. The Court referenced a few earlier cases in which the Court did not attend to injunction orders directed at a party in a suit before it. These cases were Menon v. Parvathi Ammal (1), Harbhagat Kaur v. Kirpal Singh (2) and Shiv Charan Lal v. Phool Chand (3). In the last of these, the Agra Court issued an injunction restraining the plaintiff of a suit filed in Delhi from proceeding with that suit. The Delhi Court, holding that the order of the Agra Court did not bind it, continued with the suit, a decision that was supported by the High Court. Kapur J. observed at page 248 that “On the facts as have been proved it does appear rather extraordinary that a previously instituted suit should be sought to be stayed by adopting this rather extraordinary procedure.”

The Court admitted that the Indore Court could not have issued an injunction or direction to the Asansol Court not to proceed with the suit. Yet, by issuing an injunction to the plaintiff of the suit at Asansol, the effect was to achieve indirectly what an injunction to the Court itself would have accomplished. The Court stressed that a court should not achieve indirectly what it cannot do directly. The restrained plaintiff was expected to bring the order of restraint to the notice of the Court. If that Court, as anticipated by the Indore Court, respected the injunction against the appellant and refrained from proceeding, the injunction against the appellant, who was the plaintiff in that suit, would be as effective in halting the progress of the suit as an injunction directed to the Court would have been. If the Court insisted on proceeding, the plaintiff would either have to disobey the restraint order or risk dismissal of his suit for lack of prosecution. Both outcomes were consequences that a Court should not normally permit. The later‑filed suit at Indore could be stayed under section 10 of the Code of Civil Procedure, whose provisions were described as clear, definite and mandatory. That section prohibited a Court where a subsequent suit had been filed from proceeding with trial in certain specified circumstances.

In this matter, the Court observed that when the Code of Civil Procedure contains a specific provision designed to address the situation in which two suits concerning the same subject are instituted, it is not appropriate to invoke the court’s inherent powers under section 151. The Court stressed that the rule set out in section 10 of the Code remains applicable even if a previously filed suit is declared vexatious or is found to have been instituted in breach of contractual terms. The Court further rejected the proposition expressed in Ram Bahadur v. Devidayal Ltd., which suggested that the legislature had not intended section 10 to operate in such circumstances. By pointing to section 35A, the Court noted that the legislature was aware that false or vexatious claims and defences could be raised in litigation and consequently provided for the award of compensatory costs. The Court added that, had the legislature wished to exclude the operation of section 10 in these instances, it could have done so, but it chose not to. Moreover, the Court highlighted that section 22 of the Code authorises the transfer of a suit to another court when the suit could have been instituted in any one of several courts. In view of this provision, the Court said that the respondent had the option of applying to have the suit pending at Asansol transferred to the Indore Court, and that, if such a transfer had occurred, both suits could have been tried together. From this analysis, the Court concluded that the legislature had indeed contemplated the possibility of two suits seeking similar reliefs being instituted in different courts and had provided a mechanism for consolidating the litigation in a more appropriate forum.

Having considered the foregoing, the Court held that the order appealed against could not be sustained because it was not necessary to further the interests of justice nor to prevent an abuse of the court’s process. Accordingly, the appeal was allowed, costs were awarded, and the order restraining the appellant from proceeding with the suit at Asansol was set aside. In a separate note, Justice Shah indicated that, after reviewing the judgment of Justice Dayal, he agreed with the conclusion that the appeal must succeed. However, Justice Shah expressed the view that civil courts, other than the chartered High Courts, do not possess a general inherent jurisdiction to grant temporary injunctions in matters not covered by rules 1 and 2 of Order 39 of the Code of Civil Procedure. He explained that the authority of such courts to grant temporary injunctions in the exercise of their ordinary original civil jurisdiction is confined to the powers enumerated in section 94(1)(c) and Order 39 of the Code. A temporary injunction may be granted only if it is expressly prescribed by the procedural rules, and the relevant provisions governing the issuance of temporary injunctions are found within Order 39, rules 1 and 2.

In this case the Court explained that the rules numbered 1 and 2 of Order 39 allow a temporary injunction to be granted only when the matter falls squarely within those rules, and that ordinarily civil courts do not possess authority to grant injunctions if they exceed the limits set by the rule. The Court acknowledged that High Courts created under Charters and exercising ordinary original jurisdiction do possess an inherent power to grant an injunction that restrains parties in a suit before them from pursuing parallel proceedings in another court, but that such power rests on the claim of the Chartered High Courts that they have inherited the jurisdiction from the Supreme Courts which they succeeded. The Court noted that this jurisdiction is preserved by section 9 of the Charter Act (24 and 25 Vict. c. 104) of 1861, and that the same jurisdiction is expressly provided for in section 4 of the Code of Civil Procedure, 1908. However, the Court emphasized that the authority of civil courts other than the Chartered High Courts must be located within section 94 of the Code and within rules 1 and 2 of Order 39 of the Civil Procedure Code. The Court further observed that the Code of Civil Procedure is not an exhaustive compendium; it does not contain rules to guide every possible situation nor does it aim to prescribe rules for every conceivable case that may arise. Nevertheless, civil courts are empowered to pass such orders as may be necessary for the ends of justice or to prevent abuse of the court process, but where the Code contains an express provision for a particular situation, that provision must be followed and departure from it is not permitted. The Court cited the decision reported in L.R. 62 I.A. 80 (Maqbul Ahmed v. Onkar Pratab) stating that “It is impossible to hold that in a matter which is governed by an Act, which in some limited respects gives the court a statutory discretion, there can be implied in court, outside the limits of the Act a general discretion to dispense with the provisions of the Act.” The Court also recognized that the inherent jurisdiction of a court to make an order ex debito justitiae is affirmed by section 151 of the Code, but clarified that this jurisdiction cannot be exercised in a manner that nullifies the provisions of the Code. When the Code expressly addresses a particular matter, the provision should normally be treated as exhaustive. Accordingly, the power to issue an injunction is limited by section 94 and Order 39, and a civil court that is not a Chartered High Court cannot invoke its inherent jurisdiction to ignore those restrictions. The Court further remarked that the decision of this Court in Padam Sen v. The State of Uttar Pradesh does not support the appellant’s case. In the Padam Sen case the Court was hearing an original appeal to decide whether an order of a Munsiff appointing a commissioner to seize certain account books of the plaintiff in a suit pending before the Munsiff was an order authorized by law. The prosecution alleged that the appellants had offered a bribe to

The Court noted that the appellant had allegedly offered the commissioner a bribe so that the commissioner would be permitted to alter entries in the books of account, and that this alleged act constituted an offence punishable under section 165A of the Indian Penal Code. The Court then ruled that the commissioner who had been appointed by the civil court in the exercise of powers under Order 26 of the Code of Civil Procedure did not hold any office of a public servant, and that because the appointment had been made by a Munsiff who lacked jurisdiction to appoint a commissioner, the person so appointed could not be treated as a public servant. In addressing the submission of counsel for the appellant, the Court considered the claim that the civil court possessed an inherent power to appoint a commissioner under section 151 of the Code of Civil Procedure for purposes that were not covered by section 75 and Order 26 of the Code. The Court quoted the relevant provision, stating: “Section 75 of the Code empowers the Court to issue a commission, subject to conditions and limitations which may be prescribed, for four purposes, namely for examining any person, for making or adjusting accounts, and for making a partition.” The Court further observed that Order XXVI contains the rules governing the issue of commissions and related matters. Counsel for the appellant, identified as Mr Chatterjee, argued that the powers of a Court must be confined within the four corners of the Code and that when the Code expressly regulates commissions in section 75, the Court could not rely on its inherent power under section 151 to expand those powers. Conversely, counsel for the State contended that the Code was not exhaustive and that, in the exercise of its inherent powers, a Court could adopt any procedure not expressly prohibited by the Code or by necessary implication, if the Court deemed such a procedure necessary to achieve justice or to prevent abuse of the Court’s process. x x x x x x x x The Court held that the inherent powers of a Court are supplemental to the powers expressly conferred by the Code, and that they are complementary rather than substitutive. Accordingly, the Court was free to invoke its inherent power under section 151 for purposes that did not clash with the specific provisions of the Code or with the legislative intent behind those provisions. The Court also emphasized that the inherent power must not be exercised in a manner contrary to, or different from, the procedure expressly provided in the Code. Finally, the Court concluded that, when exercising its powers under section 151 of the Code of Civil Procedure, 1908, the Court could not issue a commission for the purpose of seizing the plaintiff’s books of account, because such a purpose was not authorized by section 75. The Court therefore found that the appellant’s argument was untenable. Section 75 authorises commissions only for the purposes specifically listed therein, even though it does not expressly state that no other purpose is permissible; the Court interpreted this omission as an implicit restriction, thereby rejecting the appellant’s contention.

The Court observed that Section 76 of the Code expressly provides that the Court has no authority to appoint a commissioner for any purpose other than those expressly listed, and therefore a prohibition against such appointments is implicitly contained in that provision, as the Court explained in the decision reported as Padam Sen’s case. By the same line of reasoning, the Court held that the power to grant injunctions is likewise confined to the situations specifically prescribed by the rules contained in the Orders of Schedule I. Consequently, the Court explained that this power cannot be exercised in any manner or for any purpose that falls outside the scope of Order 39, Rules 1 and 2. In light of these observations, the Court concluded that the relief sought in the appeal was warranted and therefore allowed the appeal.