Partha Chakraborty & Others Vs Anindya Mitra & Others (Calcutta High Court)
The Calcutta High Court considered a batch of revisional applications under Article 227 of the Constitution challenging interlocutory orders passed by the District Judge at Alipore in Misc. Appeal No. 380 of 2025. The appeal arose from an order dated November 14, 2025 passed by the Civil Judge (Senior Division), 5th Court at Alipore in Title Suit No. 1715 of 2025. The suit concerned disputes over shares held by the opposite party in a company incorporated in England and Wales. The opposite party had sought declaratory, permanent and mandatory injunctions and had also sought interim protection concerning his employment and the proposed buyback/sale of his shares.
The opposite party had initially been employed by the petitioner no.3 company from August 1, 2024 and subsequently resigned on June 1, 2025, leaving employment on August 31, 2025. He later obtained another employment from November 3, 2025. The petitioners thereafter sought to buy back shares held by him in the petitioner no.2 UK company. The opposite party disputed their entitlement and instituted the suit. The Trial Court, on November 14, 2025, granted ex-parte ad interim protection against interference with his new employment while observing that the other prayers would be considered after hearing the defendants. The opposite party appealed, and on November 18, 2025 the District Judge restrained the petitioners from taking steps to sell the opposite party’s 100,000 shares without leave of the Court. The injunction was subsequently extended by further orders.
The petitioners challenged the maintainability of the appeal, the jurisdiction of the Indian Courts, the restraint concerning the UK company’s shares, and the absence of reasons in the November 18, 2025 order. They relied upon the Shareholders’ Agreement and Articles of Association, which they stated were governed by English law and provided for exclusive jurisdiction of the Courts of England and Wales. They also relied on provisions of the Income-tax Act, FEMA and the FEMA Overseas Investment Rules and Regulations, contending that the proposed buyback was not prohibited and that any regulatory issues did not render the transaction void. The opposite party, in response, disputed the applicability of the exclusive jurisdiction clause and contended that the proposed transaction would conflict with Indian statutory requirements concerning FEMA, pricing and repatriation of funds.
On maintainability, the High Court distinguished the Supreme Court’s decision in Shyam Sel And Power Limited & Another, noting that the present matter arose from an appeal under Order XLIII Rule 1(r) of the Code of Civil Procedure, 1908. The Court examined the Trial Court’s prayers and order and found, prima facie, that the Trial Court had not merely postponed consideration of all interim reliefs. Rather, by granting only the employment-related relief and directing the defendants to show cause why the temporary injunction should not be made absolute, the Trial Court had impliedly refused the remaining ex-parte ad interim reliefs. The High Court therefore found the appeal prima facie maintainable, while leaving the ultimate issue of maintainability to the Appellate Court.
The principal reason for interference was the District Judge’s failure to give adequate reasons for the November 18, 2025 injunction. The order merely recorded that a prima facie case existed with reference to Sections 24 and 27 of the Indian Contract Act and Sections 50CA and 56(2)(x) of the Income-tax Act, that the balance of convenience favoured the plaintiff, and that urgency and possible multiplicity of proceedings existed. The High Court found no reasoning explaining how the statutory provisions were violated, why the balance of convenience favoured the plaintiff, why immediate ex-parte protection was necessary, or how multiplicity of proceedings would arise.
The Court relied upon the requirement that a judicial order must disclose both the “what” and the “why”. It referred, among others, to Asma Lateef & Another, Uniworth Resorts Limited & Another, Sailesh Bhansali, and Bloomberg Television Production Services India Private Limited & Others. In particular, the Court noted that merely recording the threefold test of prima facie case, balance of convenience and irreparable injury does not demonstrate application of mind. The Court observed that the principles concerning reasoned orders apply to ex-parte ad interim injunctions and that the Appellate Court’s order, which granted relief not granted by the Trial Court, required reasons supporting its conclusions.
The High Court also interfered with the December 18, 2025 order extending the injunction. The District Judge had postponed the objection to territorial jurisdiction because the November 18 order was already under challenge before the High Court. The High Court held that this did not constitute sufficient reasoning for extending an ex-parte injunction. Referring to Asma Lateef & Another, it stated that when jurisdiction or maintainability is challenged at the interim stage, the Court should record at least a prima facie satisfaction regarding jurisdiction before granting interim protection, subject to the exceptional situation contemplated in that decision.
The High Court expressly refrained from finally deciding whether the Trial Court and Appellate Court possessed jurisdiction over the dispute involving the UK company’s shares and the contractual forum-selection clause. It held that the issue should first be decided by the Appellate Court where the objection had originally been raised, at the threshold while determining the opposite party’s prima facie case.
Accordingly, the Calcutta High Court set aside the orders dated November 18, 2025 and December 18, 2025. The subsequent extension orders dated January 21, March 2, April 9 and May 6, 2026 were also rendered ineffective as dependent orders. The opposite party was permitted to renew the prayer for injunction before the Appellate Court and seek preponement of the hearing. The Appellate Court was directed to first arrive at at least a prima facie finding on jurisdiction, along with the other requirements for deciding an injunction application. As a short-term equitable measure, if the petitioners intended to take any step concerning the shares within one week, they were directed to give the opposite party three working days’ prior written notice. The connected revisional applications were disposed of with no order as to costs.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
1. Since all the revisional applications under Article 227 of the Constitution of India are directed against interlocutory orders passed by the learned District Judge at Alipore, South 24 Parganas in the same proceeding i.e. Misc. Appeal No. 380 of 2025, which has been preferred by the opposite party no.1 (hereafter “the opposite party”) against an order dated November 14, 2025 passed by the learned Civil Judge (Senior Division), 5th Court at Alipore in Title Suit No. 1715 of 2025, therefore, all of them are being taken up together and are being dealt with by a common order.
2. C. O. 4439 of 2025 is directed against order dated November 18, 2025 passed by the learned District Judge at Alipore in Misc. Appeal No. 380 of 2025 whereby the petitioners have been restrained from taking any step to sell any share of the opposite party to the petitioner no.2 company without the leave of the learned Court.
3. C. O. 224 of 2026 assails an order dated December 18, 2025 whereby the earlier order dated November 18, 2025 was extended without deciding the objection as regards territorial jurisdiction of the Court taken by the petitioner.
4. C. O. 431 of 2026, C.O. 1052 of 2026 and C.O. 1513 of 2026 are all directed against orders extending the initial interim order dated November 18, 2025 passed by the learned District Judge at Alipore in the said appeal.
FACTS OF THE CASE:
5. The relevant facts of the case may be briefly recounted:-
i. The opposite party has instituted Title Suit No. 1715 of 2025 against the petitioners/defendants before the learned Civil Judge (Senior Division), 5th Court at Alipore, South 24 Parganas praying inter alia for decrees for declaration and permanent as well as mandatory injunction.
ii. Shorn of vast details, the case run in the plaint is as follows:-
a. Both the petitioner no.1 and the opposite party were initially employed in IBM, India. At IBM, India, the petitioner no.1 was the manager of the opposite party. It is the opposite party-plaintiff’s case that he “sacrificed a secure job in respect of an Indian Company with multinational presence, being heavily influenced by the defendant no.1” (i.e., the petitioner no.1 herein).
b. The petitioner no.1 formed and incorporated the petitioner no.2 company in England and Wales. Thereafter, the petitioner no.1 set up/established the petitioner no.3 company in India as a wholly owned subsidiary of the petitioner no.2 company aiming to bring in senior qualified IT personnel as shareholders of the petitioner no.2 company while employing them in petitioner no.3 company.
c. When the opposite party moved to the United Kingdom (hereafter “UK”) and joined his services at IBM, UK, the petitioner no.1 contacted the opposite party and thereafter, in April 2025 (sic 2024), the proforma opposite party no.3 (i.e. the wife of the opposite party) became a shareholder of the petitioner no.2 company upon entering into a Share Holders’ Agreement (hereafter “the SHA”) inter alia with the petitioner nos.1 and 2.
d. Thereafter, the opposite party became an employee of the petitioner no.3 company with effect from August 01, 2024. The petitioner no.1 convinced the opposite party to take 50% reduction of his previously drawn salary at IBM.
e. As the proforma opposite party no.3 could not continue to do business with the petitioner nos.1 and 3, therefore, it was agreed that the shares of the opposite party no.3 would be transferred in favour of the opposite party and the opposite party would become a shareholder of the petitioner no.2 company. Accordingly, a Deed of Adherence (hereafter “DOA”) was entered into between the petitioner no.2 company and the opposite party whereby the petitioner no.1 agreed to be bound by the SHA. Although, the said DOA is dated August 09, 2024, the same was signed on September 15, 2024. The opposite party thus became a shareholder of the petitioner no.2 with 10% holding in the petitioner no.2 company.
f. After a brief stint of employment in the petitioner no.3 company, disputes and differences arose between the petitioner no.1 and the opposite party. The opposite party therefore tendered his resignation on June 01, 2025 and ultimately left the employment of the petitioner no.3 company on August 31, 2025 upon expiry of the three months’ notice period.
g. After remaining jobless for two months the opposite party took up another job with effect from November 03, 2025.
h. The petitioners thereafter sought to buy-back the shares of the petitioner no.3 company that the opposite party owns. The opposite party claims that the petitioners are not entitled thereto and as such the opposite party has instituted the suit praying for the reliefs claimed in the plaint.
iii. In the said suit the opposite party made an application under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908 (hereafter “the Code”) praying for temporary and ad interim injunction.
iv. The said application was pressed by the opposite party for ex-parte ad-interim order before the learned Trial Court on November 14, 2025. Upon hearing the opposite party and upon perusing the material on record, the learned Trial Court observed that the opposite party had been able to make out a prima facie case as regards prayer (a) of the said application and accordingly restrained the defendants in the suit from “disturbing the peaceful employment” of the opposite party till December 09, 2025. The learned Trial Court further observed that the other prayers made in the said application would be “decided” upon hearing the defendants.
v. Feeling aggrieved thereby, the opposite party carried the matter in appeal being Misc. Appeal No. 380 of 2025 before the learned District Judge at Alipore. In the said Misc. Appeal, the opposite party filed another application under Order XXXIX Rules 1 & 2 of the Code praying for ad interim reliefs.
vi. The said application was moved ex-parte on November 18, 2025. Upon hearing the opposite party, the learned Appellate Court passed an ex-parte ad interim order of injunction in terms of prayer (a) of the said application thereby retraining the petitioners from “taking any step to sell any shares having number 1,00,000 of the plaintiff/appellant in favour of the respondent/defendant no.2” without the leave of the Court till December 18, 2025.
6. Feeling aggrieved thereby the petitioner has approached this Court by filing C.O. 4439 of 2025. The other revisional applications have been filed assailing the orders extending the said interim order that was passed initially on November 18, 2025 as already indicated hereinabove.
ARGUMENTS ON BEHALF OF THE PETITIONERS:
7. A brief summary of the submissions made by Mr. Mookerjee, learned Senior Advocate appearing for the petitioners (both orally as well as in the written notes) is as follows:-
a. The impugned order is not sustainable as the appeal being Misc. Appeal No. 380 of 2025 was incompetent and not maintainable in law. The order dated November 14, 2025 passed by the learned Trial Court is not an appealable order under Order XLIII of the Code since the learned Trial Court had not taken any decision or denied any relief to the opposite party but had merely deferred or postponed the determination of certain prayers by two weeks. This does not amount to an adjudication affecting rights or liabilities and therefore no statutory appeal could have been filed under Order XLIII of the Code. In support of his submissions, he relied on a judgment of the Hon’ble Supreme Court in the case of Shyam Sel And Power Limited & Another vs. Shyam Steel Industries Limited1.
b. The prayer granted by the learned Appellate Court in relation to the buyback of shares was not made in the interim injunction application before the learned Trial Court.
c. In his first interim application, the opposite party had prayed for a “temporary mandatory injunction” seeking a direction to sell the subject shares “at a reserved price as pleaded hereinabove or as may be later determined by this Learned Court”. Therefore, the learned Appellate Court erred in failing to determine whether it had jurisdiction before passing the ex-parte interim order.
d. There is nothing on record to show how the learned Appellate Court assumed jurisdiction. Jurisdiction has to be determined at the threshold before passing any order, including interim orders and at least a prima facie satisfaction has to be arrived at. A judgment of the Hon’ble Supreme Court in the case of Asma Lateef & Another vs. Shabbir Ahmad & Others2 was relied on in support of such contention.
e. No reason or authority has been shown to demonstrate that there could be departure from this settled principle of law. Furthermore, no extraordinary or high-hardship scenario has been shown to exist that was considered in the impugned order or in the pleadings in the learned Courts below.
f. The impugned order that has been passed is wholly without jurisdiction as all prayers in relation to the subject shares concern a company incorporated in UK and governed by instruments expressly subject to English laws and the exclusive jurisdiction of the Courts of England and Wales. The petitioner no.2 is a foreign company incorporated under the laws of England. Its Articles of Association (hereafter “AoA”) were adopted pursuant to Chapter 2 of Part 13 of the UK Companies Act, 2006. The proceedings before the learned Trial Court and the learned Appellate Court are therefore ex facie not maintainable.
g. The interim prayers made by the opposite party in the appeal relating to the buyback of shares are governed by the AoA of the opposite party no.3. The AoA specifically contemplates two classes of “Leavers”, namely a “Good Leaver” and a “Bad Leaver”. Since the opposite party ceased to be a relevant employee, he was rendered a “Bad Leaver”, thereby triggering Clause 16 of the AoA, which entitles the opposite party no.3 to compulsorily buyback the shares and execute all necessary instruments to give effect thereto.
h. Since the situs of the shares of petitioner No.2 Company is in UK therefore, the learned Appellate Court does not have jurisdiction to pass orders in respect of property located outside its jurisdiction. The judgment in the case of Vodafone International Holdings BV vs. Union of India & Another3 was relied on for such purpose.
i. The opposite party voluntarily became a shareholder of the petitioner no.2 – a UK Company. He has signed the DOA and is bound by the SHA and all the obligations contained therein. The SHA unequivocally provides that the agreement shall be governed by English laws and that all disputes arising therefrom shall be subject to the exclusive jurisdiction of the Courts of England and Wales. Parties are entitled to confer exclusive jurisdiction upon foreign Courts, and such forum selection clauses must ordinarily be enforced by Indian Courts. Modi Entertainment Network & Another vs. W.S.G Cricket Pte. Limited4 was relied on for such purpose. The written note captioned “Short Points of Arguments on behalf of the petitioners” also refers to another judgment in the case of British India Steam Navigation Co. Limited vs. Shanmughavilas Cashew Industries & Others5 to buttress the same point.
j. In view of the forum selection clause, the learned Trial Court and the learned District Judge had no jurisdiction to the pass the impugned order. The Courts of England and Wales are Courts of competent jurisdiction and can decide the compliance of the transaction with Indian laws.
k. In view of the exclusive jurisdiction clause, the UK High Court (Commercial Division) passed an order of temporary injunction on December 12, 2025 restraining the opposite party from pursuing the Indian proceedings. This injunction was made permanent vide order dated January 16, 2026. Due to the opposite party’s breaches of these orders, the UK High Court found the plaintiff to be in contempt and sentenced him to 12 months imprisonment vide order dated April 17, 2026
l. The impugned order is unreasoned. It does not disclose any independent reasoning for reaching its conclusion on the prima facie case sought to be established by the opposite party.
m. Paragraphs 1 and 4 of the impugned order demonstrate that the learned Appellate Court merely reproduced and adopted the submissions advanced by the opposite parties without recording “what” its findings are and “why” they have reached such findings.
n. The impugned order and its subsequent extensions (as challenged in the batch of COs), fail to meet the ‘what’ and ‘why’ test as it does not disclose any findings, justifications or reasons for holding that there is a prima facie Asma Lateef & Another (supra), Sailesh Bhansali vs. Alok Dhir & Others6 and Uniworth Resorts Limited & Another vs. Ashok Mittal & Others7 were cited to support the assertion.
o. Without prejudice to the objection as to of jurisdiction, the opposite party has failed to establish any prima facie In the title suit, the opposite party has contended that the buyback of the subject shares at the issue price violates the provisions of the Income Tax Act, 19618 (particularly Sections 50CA, 56(2)(x), 92 and 92F thereof) and FEMA, thus being void pursuant to Section 24 of the Indian Contract Act, 1872 (hereafter “the 1872 Act”).
p. FEMA Act as well as the Foreign Exchange Management (Overseas Investment) Rules, 2022 and Regulations of 2022 do not contemplate any prohibition or bar or any such transaction. In any event, any alleged violation of FEMA does not make the transaction void. Any alleged violation is curable and rectifiable and does not mean that the transaction is in violation of law or fundamental policy of Indian law, therefore, it cannot be said that the transaction or its object or the consideration is unlawful. Vijay Karia & Others vs. Prysmian Cavi E Sistemi SRL & Others9 was cited in support of such argument.
q. Section 50CA or Section 56(2)(x) of the 1961 Act does not contemplate any bar or prohibition against the sale of shares at the issue price. Instead the statutory scheme expressly recognizes that such situations may arise where consideration received may not be the same as the value of the shares and lays down how such proceeds are to be taxed. Similarly, Sections 92 and 92F of the 1961 Act are not attracted in the instant case since the transaction involved in the suit does not pertain to “associated companies” or transfer pricing.
r. Any tax payable and compliance required are squarely the plaintiff/opposite party’s personal obligation and do not create any liability on the company. The opposite party was always aware of the implications of being rendered a ‘Bad Leaver’. The same would be evident from the emails dated October 22, 2025 and email dated October 28, 2025. From such correspondence, it is also clear that the plaintiff was always aware that he had a tax liability and that the AD Bank “regulatory block” resulted in only “hold” on the buyback till regularisation process was completed with Reserve Bank of India (hereafter “RBI”). Therefore, the case made on illegality or violation of FEMA cannot be sustained.
s. All allegations of FEMA violation by the Plaintiff/opposite party based on the email from HDFC Bank are misplaced. The violation alleged in that email relates to a failure to disclose the transfer of shares from opposite party no.4 to the Plaintiff/opposite party as required under the FEMA Act and Rules framed thereunder. In any event, they could be regularized with RBI through the payment of LSF (Late Submission Fee).
t. In any event, all rights and contentions of the opposite party that the manner of the working of the transaction is contrary to the abovementioned provisions can always be urged before the Courts of England and Wales.
u. It was urged that the initial order granting injunction and all the subsequent orders of extension, ought to be set aside.
ARGUMENTS ON BEHALF OF THE OPPOSITE PARTIES:
8. A brief summary of the submissions made by Mr. Chowdhury, learned Senior Advocate appearing for the opposite parties (both orally as well as in the written notes) is as follows:-
a. Clause 22.2 of the SHA has three limbs which define the subject matter that can be carried to the agreed English Court. The first limb of this clause relates to disputes or claims (including any non-contractual disputes or claims) which may arise out of or in connection with the SHA. The second limb relates to disputes or claims in connection with the subject matter or formation of the SHA. The third limb relates to disputes or claims as to the rights and liabilities of the shareholders in connection with the business and their holding of shares. The present dispute does not fall under any of the three limbs of Clause 22 of the SHA.
b. While the Petitioners rely upon the principles of international comity and choice of forum laid down in Modi Entertainment Network & Another (supra), that landmark ruling itself explicitly recognizes that a domestic Court will refuse to enforce a foreign exclusive jurisdiction clause if the agreed foreign forum is shown to be oppressive or vexatious. Forcing an Indian resident individual, under the threat of offshore penal committal, to execute a transaction on Indian soil that directly commands a blatant breach of mandatory domestic exchange controls and fiscal policies constitutes the oppression, which completely strips Clause 22.2 of its binding effect.
c. If the reliefs that the opposite party claims in the suit can never be granted by the English Court, upon consideration of the Indian law (FEMA, the 1872 Act and the 1961 Act), it is but obvious that there is no ouster of jurisdiction under Clause 22 of the SHA for the learned Court to receive, try and entertain the suit.
d. Furthermore, the English Courts do not have jurisdiction. Relying on Taprogge Gesellschaft MBH vs. IAEC India Limited10, it was submitted that a contract, valid by the proper law cannot be enforced in the country where it has to be performed if its performance is opposed to the fundamental principles of public policy or a statute of that country.
e. In terms of Article 16 of the AoA, the opposite party is required to deliver the relevant share certificates against payment of the sale price for such shares to complete the transaction of sale envisaged therein. In the event the orders under challenge are set aside and/or vacated and the injunction is lifted, the petitioners would be entitled to buyback the opposite party’s shares and deposit the fund in a trust which then would require the opposite party to repatriate such funds to its Indian account within 90 days, as per Regulation 9(4) of the FEMA Overseas Investment Regulations, 2022. Therefore, performance of the obligations would end at India only when the fund is repatriated. Relying on paragraph 23 of the report, it was contended that if the contract has to be performed in India, Indian statute will govern the legality of the performance. Indian Courts will not enforce the contract if its performance involves the violation of an Act of the legislature.
f. Referring to Regazzoni vs. K. C. Sethia (1944) Limited11 which has been relied on by the Hon’ble Bombay High Court in Taprogge Gesellschaft MBH (supra) it was sought asserted that in that case too, the English Court took judicial notice of the Indian law and refused to enforce the agreement between the contracting parties.
g. The performance of the AoA and the SHA would contravene the various laws under the FEMA regime namely:-
(i) Article 16.1.3(c) of the AoA directly contravenes 16(1) of the FEMA Overseas Investment Rules 2022 (which provides for pricing guidelines and requires price to be arrived at on arm’s length basis) inasmuch as the sale price of the shares for a Bad Leaver would be the lower of the Fair Price and the Issue Price and in this case the Fair Price, being the price of the shares at market value, is currently worth much more than the Issue Price of around Rs. 1 Crore. In fact, Rule 16(2) provides that the AD bank, before facilitating a transaction under sub-rule (1), shall ensure compliance with arm’s length pricing taking into consideration the valuation as per any internationally accepted pricing methodology for valuation.
(ii) Any arrangement of specifically or compulsorily performing a buy-back in the United Kingdom and holding the proceeds of such alleged compulsory buy-back in a trust for the benefit of the plaintiff would completely frustrate the directions under Regulation 9(4) of the FEMA Overseas Investment Regulations 2022 which provides that a person resident in India having overseas direct investment (hereafter “ODI”) in a foreign entity, wherever applicable, shall realise and repatriate to India, all dues receivable from the foreign entity with respect to investment in such foreign entity, the amount of consideration received on account of transfer or disinvestment of such ODI and the net realisable value of the assets on account of the liquidation of the foreign entity as per the laws of the host country or the host jurisdiction, as the case may be, within ninety days from the date when such receivables fall due or the date of such transfer or disinvestment or the date of the actual distribution of assets made by the official liquidator.
(iii) Thus, the funds receivable by the person resident in India must be repatriated into India within 90 days from the date when such receivables fall due i.e., from the date when the buy-back is effected and if that is done the opposite party would suffer.
h. While the principles of law relied upon by the petitioners in their submissions cannot be challenged, the same do not have any application to the facts of the present case.
i. The learned Appellate Court has jurisdiction to decide upon the issues raised in the suit. Once the learned Appellate Court is established to have jurisdiction, any further question involving interim reliefs would be rendered nugatory.
j. The petitioners have relied upon the judgment in the matter of Shyam Sel And Power Limited & Another (supra) in support of the contention that an Appellate Court has no power to interfere with the exercise of discretion of the Court of first instance and substitute its own discretion, except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the Court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. According to the petitioners, the learned First Appellate Court did not decide the jurisdictional objection while extending the ex-parte ad-interim order dated November 18, 2025, on December 18, 2025.
k. As would appear from paragraph 31 of the report, the Hon’ble Supreme Court took note of the fact that the hierarchy of the learned Trial Court and the learned Appellate Court existed so that the learned Trial Court exercises its discretion upon the settled principles of law. The present civil revisional applications have remained pending since 2025. If an issue of jurisdiction is to be decided by the learned First Appellate Court, a direction could be issued on the learned First Appellate Court to decide such issue considering the hierarchy of the Courts. The Supreme Court also takes note of such fact that if the learned Appellate Court itself decides the matters required to be decided by the learned Trial Court, there would be no necessity to have the hierarchy of Courts.
l. Paragraph 41 of Asma Lateef & Another (supra) explicitly carves out an exception for extraordinary, high-hardship scenarios, preserving a Court’s inherent power to protect the subject matter of a suit where a refusal of ad-interim relief would instantly result in an irreversible, structural violation of sovereign domestic laws.
m. If the learned Trial Court has the jurisdiction to receive, try and entertain the suit, the learned Appellate Court also has the jurisdiction to pass and extend the ad-interim orders on November 18, 2025 and December 18, 2025, respectively.
n. Without prejudice, it is submitted that this Hon’ble Court has the power to supplant reasons in support of the jurisdiction argument advanced by the opposite party, considering the balance of convenience and inconvenience and the irreparable injury that may be suffered by the opposite party if the orders under challenge are set aside or vacated.
o. In the facts of the present case, if the revisional Court itself decides the point of jurisdiction, it would have the effect of nipping the plaint in the bud, ignoring the essence of the principles relating to hierarchy of Courts.
p. The provisions of Section 15 of FEMA enable compounding of any contravention under the Act. The RBI is empowered to compound any contravention as defined under Section 13 of FEMA. Section 13 of FEMA provides for the penalties that are to be imposed if a person contravenes any provision of the Act.
q. RBI issued the Circular dated October 01, 2024, containing directions for compounding of contraventions under FEMA for all AD banks to follow, being FEMA Directions Compounding of Contraventions 2024 (“RBI Circular”) under FEMA, 1999.
r. In terms of Clause 2.2 of the RBI Circular, the contravention of Rule 21 of the FEMA Overseas Investment Rules, 2022 is compoundable. There is no other Rule in the FEMA Overseas Investment Rules, 2022 that is envisaged as compoundable in the RBI Circular 2024. It therefore transpires that contravention of pricing guidelines under Rule 16 of the FEMA Overseas Investment Rules, 2022 is not compoundable.
s. Under Clause 3.1 of the RBI Circular 2024, an application for compounding is envisaged, which can be filed either suo motu or based on a Memorandum of Contraventions issued by RBI. Such an application cannot be made by the plaintiff as violation of Rule 16 of the FEMA Overseas Investment Rules, 2022 is not envisaged as compoundable contravention.
t. In arguendo, even if the RBI Circular 2024 is applicable and an application for compounding is maintainable for contravention of Rule 16 of the FEMA Overseas Investment Rules 2022, Clause 4.2 of the RBI Circular 2024 provides that no compounding application shall be processed without relevant administrative action. Amongst others, administrative actions include repatriating the receivable dues and compliance with pricing guidelines.
u. Such repatriating of receivable dues is to be complied under Regulation 9(4) of FEMA Overseas Investment Regulations, 2022 and compliance with pricing guidelines must be followed under Rule 16 of the FEMA Overseas Investment Rules, 2022.
v. The petitioners have relied upon paragraph 88 of the judgment in the matter of Vijay Karia & Others (supra)12. In this case, the foreign award which was sought to be enforced directed sale of shares by a resident of India to a non-resident at a sum which shall not be less than market value of the shares in violation of Rule 21 of the Non-Debt Instrument Rules. The award directed the shares to be a sold at a sum less than the market value. Relying upon paragraph 88 of the report, petitioner has argued that the enforcement of a foreign award was not allowed to be resisted on the ground that the same was in contravention of the “fundamental policy of Indian law”.
w. The expression used in Section 48 of the Arbitration and Conciliation Act, 1996 is “fundamental policy of Indian law”, which is different from the expression used in Section 13(f) of the Code which is “breach of any law in force in India”. The arbitration-centric narrow standards advanced by the petitioners in Vijay Karia & Others (supra) is wholly inapplicable to a civil suit testing a Foreign Court’s orders under Section 13(f) of the Code. The inclusion of the literal word “any” in Section 13(f) creates a zero-tolerance bar against any statutory infraction (it may be recorded that the written note also mentions that “Renusagar (supra)” alongwith Vijay Karia & Others (supra) but the Renusagar case was not cited by the petitioners).
x. The opposite party here relies upon Section 13(f) of the Code whereby a foreign judgement shall not be conclusive as to any matter thereby directly adjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title except where it sustains a claim founded on a breach of any law in force in India. It is submitted that a decree of the English Court shall be rendered inconclusive and inexecutable in India as the same would violate provisions of FEMA, being breach of law in force in India.
y. In Griesheim GMBH (Now Called Air Liquide Deutschland GMBH) vs. Goyal MG Gases Private Limited13, the order of the Delhi High Court refusing to enforce a foreign judgement passed by the English Court was under challenge. One of the two questions that arose related to the bar of enforcement in view of the conditional prior permission given by RBI under the repealed FERA 1973. Section 47 of FERA and the effect of Section 47(3)(b) engrafted an express limitation in mandatory terms stipulating that “no steps shall be taken for the purpose of enforcing any judgement/order ……. except….. as the RBI…. may permit”. This mandatory provision was not complied. The Supreme Court held that the foreign judgement suffered from fundamental infirmities of the Code, which included Section 13(f) and the enforcement of liability contrary to binding statutory conditions brings the decree within the prohibition contained in Section13(f), being opposed to the law in force in India. The foreign judgement therefore failed the substantive tests mandated in Section 13(f) of the Code.
z. Although this appears to be a defence raised to resist enforcement of a foreign judgement, the suit instituted by the opposite party is to seek declaratory reliefs on the self-same principles so as to avoid a foreign judgement which could be resisted in future. What can be used as a defence at a later stage in litigious proceedings should not preclude the plaintiff from using the same as a cause of action to seek reliefs, which the English Court, in any event, would not be competent to grant in the first place.
aa. The opposite party has sought for a declaration that the SHA is void and nullity. If the SHA cannot be enforced, the shares held by the opposite party in petitioner no.2 company cannot be sold/bought back. The interim prayer in the learned First Appellate Court, seeking for a temporary injunction against the defendants from selling the opposite party’s shares in petitioner no.2 company, is in aid of the final reliefs in the suit and therefore maintainable.
bb. Prayer (e) of the injunction application filed before the learned Trial Court, is for a temporary/mandatory injunction directing the petitioners to sell the shares at a reserve price or at such other price determined by the learned Court. Prayer (a) of the injunction application filed in the learned First Appellate Court is for a temporary injunction to restrain the petitioners from selling the opposite party’s shares. Both the prayers are to protect the opposite party’s interest in the subject shares and do not run contrary to each other.
cc. These prayers are in support of the main reliefs (b) and (c) of the plaint. As the prayers sought in the injunction applications before the learned Trial Court and the learned First Appellate Court are couched within the broader relief sought in the plaint, the same ought not to be interfered with.
dd. Reasons cannot be said to be absent if it is rendered after considering detailed submissions of the petitioners. The learned First Appellate Court was not inclined to interfere with the order dated November 18, 2025 as the petitioner had already challenged such order in C.O. 4439 of 2025. The issue of jurisdiction, being the primary challenge in C.O. 4439 of 2025, was sub judice before the Hon’ble Court, and therefore applying the principles of judicial propriety and comity, the learned First Appellate Court thought it fit to extend the ad-interim order dated November 18, 2025.
ee. The reason for this is also recorded in the order dated December 18, 2025, which records that “…this Court should restrain and avoid passing order that could circumvent, prejudice, or render infructuous the proceeding”.
ff. Since the issue was res sub judice, the learned First Appellate Court passed the order dated December 18, 2025 and has been continuing to extend the original ex-parte ad-interim order dated November 18, 2025, from time to time.
gg. The English Court has granted relief in the nature of anti-suit injunction to the contesting petitioners by passing an order dated December 12, 2025. This order has been confirmed by another order dated January 16, 2026.
hh. As indicated above, if this Court decides the issue of the opposite party jurisdiction in favour of the petitioner, the corollary to this would be that the orders of the English Court granting anti-suit injunction will not prevent the opposite party from pursuing or continuing the suit. A Court of natural jurisdiction can grant an anti-suit injunction under certain exceptional circumstances.
ii. Any order of interference would amount to lifting and/or vacating the interim protection in respect of 100000 shares that is being enjoyed by the opposite party. This would have the immediate result of permitting a forced, illegal buyback of the shares held by the opposite party, thereby rendering the suit itself infructuous.
jj. For the reasons aforesaid, the applications filed by the petitioners challenging the orders dated November 18, 2025 and December 18, 2025 as well as the extension of the interim orders thereafter on diverse dates, deserve to be dismissed.
REJOINDER OF THE PETITIONERS:
9. Mr. Mookerjee, learned senior advocate appearing for the petitioners made the following submissions in reply:-
a. The opposite parties have sought to misread and misconstrue the decision of the Hon’ble Supreme Court in the case of Shyam Sel And Power Limited & Another (supra). The said decision was not relied upon by the petitioners for the propositions asserted in paragraph 37 of their note.
b. Shyam Sel And Power Limited & Another (supra) was cited for the proposition that since there was only a postponement of determination by the learned Civil Judge, there was no “order” that could be appealed from. As such, the appeal before the learned Judge was not maintainable and was incompetent. The opposite party has failed to answer this point. In fact, the opposite party has not even attempted to answer this point.
c. The opposite party has sought to distinguish the decision in Asma Lateef (supra) in paragraph 38 and 39 of their note but the judgment was not cited for the proposition mentioned in paragraph 38. The said case was cited for the proposition that jurisdiction has to be decided first before passing any order, or even interim orders and at least a prima facie satisfaction has to be arrived at. The opposite party has no answer to this proposition.
d. The Courts of England and Wales are Courts of competent jurisdiction and can decide the compliance of the transaction with Indian laws. This will be evident also from the decision (cited by opposite party) in Griesheim GMBH (supra). In fact, English Courts have also taken note of Indian laws when deciding the enforcement of contracts, which will be evident from the decision (relied upon by the opposite party) in Regazzoni (supra), which has been affirmed in appeal by the House of Lords.
e. It is submitted that the opposite parties have sought to distinguish the decision in Modi Entertainment Network & Another (supra) in paragraph 30 in their note. They have sought to contend that a domestic Court will refuse to enforce a foreign exclusive jurisdiction clause if the agreed forum is shown to be oppressive and vexatious. The said contention cannot be accepted since: (i) there is no such finding in the impugned orders; (ii) such point was not raised as a ground before the District Judge, (iii) In any event, the transaction was in the course of international commerce, with both parties fully aware of the clauses therein and the implications thereof. There is no evidence of any oppression or vexatious proceedings. In any event, as stated above, the subject matter of the dispute pertains to shares of a foreign company, and the Courts in UK are the only competent Court to decide on any dispute with respect to the same.
f. The opposite parties have relied upon the decision reported in Griesheim GMBH (supra) to contend that a foreign judgment which does not consider violations under the FERA Act cannot be enforced in India by virtue of Section 13(f) of the Code. However, the said contention is wholly misconceived for the many reasons:- (a) The Hon’ble Supreme Court rejected the submission that there is an absolute bar of enforcement of decree, if there is a breach of conditions imposed under FERA. It held that the government authorities can exercise its regulatory power can grant approval for implementing the judgment. (b) In any event, the cited case concerned FERA and not FEMA. FERA and FEMA are materially different as noted in the case of Vijay Karia & Others (supra), which also held that transactions which violate FEMA cannot be held to be void.
g. The judgments relied upon by the opposite parties themselves holds that UK Courts will consider foreign law and any violation thereof, including Indian law, while deciding a lis.
h. The opposite parties have relied on a decision in Taprogge Gesellschaft MBH (supra) for the proposition that when there is a conflict between foreign law and its enforcement in a country where it has been performed such contract cannot be enforced in India since it contravenes the provisions of Indian law even if it is valid under foreign law.
i. The petitioners herein have not challenged the order of the learned Civil Judge restraining the petitioners from interfering with the new employment of opposite party. Therefore, there is no grievance with respect to that part of the order and the cited case is of no consequence.
ANALYSIS & DECISION:
10. Heard the learned Senior Advocates appearing for the respective parties and considered the material on record.
11. The first ground on which the appellate orders have been sought to be impeached is that the appeal itself is not maintainable. Such point has been raised for the first time before this Court and the opposite party’s appeal is still pending before the learned Appellate Court. It would not be proper for this Court to decide the said issue finally at the first instance, however, a prima facie finding on such aspect will be required to be returned inasmuch as if it is found that the appeal itself is prima facie not maintainable, the interim orders passed therein would lose life and there would be no further requirement to examine the orders impugned.
12. The petitioners have cited Shyam Sel And Power Limited & Another (supra) in support of their contention pertaining to non-maintainability of the appeal. The said judgment had been rendered in the context of a Letters Patent appeal. Under Clause 15 of the Letters Patent of 186514 a judgment passed by an Hon’ble Single Judge of this Court can be carried in appeal before the Hon’ble Division Bench of this Court.
13. Shyam Sel And Power Limited & Another (supra) is substantially based on an earlier judgment of the Hon’ble Supreme Court in the case of Shah Babulal Khimji vs. Jayaben D. Kania & Another15, where the Hon’ble Supreme Court had to undertake the exercise of ascertaining the true meaning of the expression “judgment” in the context of Letters Patent since the said expression has not been defined in the Letters Patent.
14. The following paragraphs of Shah Babulal Khimji (supra), which have also been quoted in Shyam Sel And Power Limited & Another (supra) deserve to be noticed before proceeding further:-
“114. In the course of the trial, the trial Judge may pass a number of orders whereby some of the various steps to be taken by the parties in prosecution of the suit may be of a routine nature while other orders may cause some inconvenience to one party or the other, e.g., an order refusing an adjournment, an order refusing to summon an additional witness or documents, an order refusing to condone delay in filing documents, after the first date of hearing an order of costs to one of the parties for its default or an order exercising discretion in respect of a procedural matter against one party or the other. Such orders are purely interlocutory and cannot constitute judgments because it will always be open to the aggrieved party to make a grievance of the order passed against the party concerned in the appeal against the final judgment passed by the trial Judge.
115. Thus, in other words every interlocutory order cannot be regarded as a judgment but only those orders would be judgments which decide matters of moment or affect vital and valuable rights of the parties and which work serious injustice to the party concerned. Similarly, orders passed by the trial Judge deciding question of admissibility or relevancy of a document also cannot be treated as judgments because the grievance on this score can be corrected by the appellate court in appeal against the final judgment.”
15. Thus, while routine orders cannot be said to be judgments withing the meaning of Clause 15 of Letters Patent, orders which decide matters of moment or affect vital and valuable rights of the parties and which work serious injustice to the party concerned would qualify to be called judgments and would therefore be appealable under Clause 15 of the Letters Patent.
16. The following paragraphs of Shyam Sel And Power Limited & Another (supra) capture the Hon’ble Supreme Court’s reasoning in support of the conclusion that the order of the Hon’ble Single Judge was not a “judgment” within the meaning of Clause 15 of the Letters Patent:-
“23. In the light of this observation, we will have to consider as to whether the order passed by the learned Single Judge dated 2-4-2019 [Shyam Steel Industries Ltd. v. Shyam Sel & Power Ltd., 2019 SCC OnLine Cal 9130] , could be construed as a “judgment” within the meaning of Clause 15 of the Letters Patent.
24. What the learned Single Judge has done by the said order, was to grant two weeks’ time to the appellant-defendants to file affidavit-in-opposition and postpone the issue of grant of ad interim injunction by three weeks. No doubt, that the learned Single Judge has at one place observed that prima facie, he was of the view that “SHYAM” being a part of the business name of the appellant-defendants, no injunction should be passed to restrain the appellant-defendants from using the said word “SHYAM” on their packaging, but in the same order, he has clarified that all the observations he has made in the said order were prima facie for the purpose of passing an order at the ad interim stage and the same would have no relevance at the time of considering and deciding the said application after exchange of affidavits.
25. It could thus be seen that the order in fact was postponement of the question as to whether the respondent-plaintiff was entitled to grant of an ad interim injunction or not, and that too, by merely three weeks. The order was only giving an opportunity to the appellant-defendants to file their affidavit-in-opposition within a period of two weeks. The order clarified that no prayer for extension of time shall be entertained. The learned Single Judge therefore postponed the issue with regard to consideration of the prayer of the respondent-plaintiff for grant of ad interim injunction by a period of mere three weeks and that too only in order to afford an opportunity to the appellant-defendants to file their affidavit-in-opposition. While doing the same, the respondent-plaintiff’s interest was also protected, inasmuch as the appellant-defendants were directed to maintain weekly accounts of sale of their products covered by Class 6, which were sold under the mark “SHYAM”.
26. It is thus clear that there was no adjudication with regard to the rights of the respondent-plaintiff to get an ad interim injunction during the pendency of the suit. Though by postponement of the issue with regard to grant of ad interim injunction, the order might have caused some inconvenience and may be, to some extent, prejudice to the respondent-plaintiff; the same could not be treated as a “judgment” inasmuch as there was no conclusive finding as to whether the respondent-plaintiff was entitled for grant of ad interim injunction or not. As such, the order passed by the learned Single Judge did not contain the traits and trappings of finality. If it is held otherwise, this will open a floodgate of appeals for parties who may even challenge the order of adjournment or grant of time to the other side to file affidavit-in-reply. We are therefore of the considered view that the order dated 2-4-2019 [Shyam Steel Industries Ltd. v. Shyam Sel & Power Ltd., 2019 SCC OnLine Cal 9130] cannot be construed to be a “judgment” within the meaning of Clause 15 of the Letters Patent and as such, the appeal to the Division Bench of the High Court was not tenable.
27. We clarify that as held in Shah Babulal Khimji [Shah Babulal Khimji v. Jayaben D. Kania, (1981) 4 SCC 8], we are holding so, taking into consideration the facts and circumstances as they appear in the present matter.”
(Emphasis supplied)
17. The aforequoted observations make it evident that in the said case the order impugned before the Hon’ble Division Bench of this Court had protected the interest of the plaintiff in that case. In other words, the order neither affected the vital and valuable rights nor worked serious injustice to the said plaintiff. The Hon’ble Supreme Court has clarified that the said judgment had been passed “taking into consideration the facts and circumstances as they” appeared in that matter.
18. Now the present case is one where the orders impugned have been passed in an appeal under Order XLIII Rule 1(r) of the Code. Order XLIII Rule 1(r) of the Code reads thus:-
“1. Appeals from Orders:
An appeal shall lie from the following Orders under the provisions of section 104, namely:-
***************** ******************* *****************
r) an Order under rule 1, rule 2 4[rule 2A], rule 4 or rule 10 of Order XXXIX;”
19. There can be no quarrel to the factual position that the order dated November 14, 2025 that has been impugned in the appeal before the learned Appellate Court was passed by the learned Trial Court on an application praying for temporary as well as ad interim injunction under Order XXXIX Rules 1 and 2 of the Code. However, it needs to be tested whether the said order can be said to be one under Order XXXIX Rules 1 and 2 of the Code. In order to form a prima facie opinion as regards the same, the prayers made in the application for temporary injunction filed before the learned Trial Court may be noticed:-
a. An order for temporary injunction restraining the Respondents/Defendants and/or their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or successor-in-office from interfering and/or disturbing in any manner whatsoever with the new peaceful employment of the Petitioner/Plaintiff;
b. An order for temporary injunction restraining the Respondents/Defendants and/or their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or successor-in-office from suing by initiating any proceeding or suit against the Petitioner/Plaintiff before any Forum including but not limited to any Forum in the UK particularly in England and Wales, without the leave of this Learned Court as it will be oppressive and vexatious;
c. An order for temporary injunction directing the Respondents/Defendants and/or their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or successor-in-office allowing the Petitioner/Plaintiff to continue with his peaceful employment in the manner which the Petitioner/Plaintiff thinks fit and proper;
d. An order for temporary injunction restraining the Respondents/Defendants and/or their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or successor-in-office from giving any effect to the Articles of Association dated 12/04/2024 and the shareholding agreement dated 14/04/2024 in relation to or in connection with the pleadings as stated hereinabove and/or prejudicial to the interest of the Petitioner/Plaintiff;
e. An order for temporary mandatory injunction directing the Respondents/Defendants and/or their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or successor-in-office by directing them to sell the shares of the Petitioner/Plaintiff at a reserved price as pleaded hereinabove or as may be determined by this Learned Court and thereafter to transfer the amount to the Petitioner/Plaintiff forthwith;
f. An enquiry be made into the proper valuation of the shares of the Petitioner/Plaintiff and thereafter to mandatorily direct the Respondents/Defendants to pay such amount as may be deemed fit and proper by this Learned Court;
g. Ad-interim injunction in terms of prayer (a) to (e);
h. Cost:
i. Such further and/or other order/s and/or direction/s be given as This Learned Court may deem fit and proper;
20. Having regard to the aforesaid prayers, certain observations of the learned Trial Court in the order dated November 14, 2025 merit attention:-
“9. The plaintiff has stated that defendant no. 1 is the resident of the jurisdiction of this court; therefore, this case has been instituted in this court, and according to the plaintiff, he has resigned from the employment of respondent/defendant no. 3 with the expiry of 31.08.2025, and as such, he was jobless for more than two months and again reemployed from 03.11.2025. It is averred by the plaintiff that he has cogent reason to conclude that the defendant will try to obtain an order in furtherance of the restrained of trade clause, which is completely void and inoperative in India.
10. The plaintiff has knocked the door of this court on the ground that defendant 1 will make a distress sale of the share of the plaintiff, preferably to one or more of the respondents. It is further stated that defendant no. 1 in communication in October 2025 explicitly threatened to initiate legal proceedings against the plaintiff if he is reemployed unless he signs a buyback agreement that will enable the company to buy back the shares at the issue price of 1 British pound per share. The plaintiff has further stated that the defendant will obtain an injunction from the UK court barring the plaintiff from working with his new employer and has also threatened the plaintiff to tarnish his image and reputation. The plaintiff is seeking a quia timet action to restrain the defendant from carrying out the threatened legal action. Learned Counsel appearing on behalf of the plaintiff has emphasized that the restriction imposed by the defendant is void and violative of Section 24 and Section 27 of the Indian Contract Act.
11. Now the plaintiff is seeking an ad interim injunction order.”
21. The above observations would show that the learned Trial Court was quite alive to the pleadings made in the application for injunction and the urgency pleaded. In paragraph 12 of the order, the learned Trial Court has referred to the various documents that were relied on by the plaintiff/opposite party in support of his case for ad interim injunction. In paragraph 13 of the order the learned Trial Court has posed the question that it proposed to answer and then in paragraphs 21 and 22 thereof the learned Trial Court held thus:-
“21. In the light of the aforesaid deliberation, prima facie, it appears that the plaintiff has passed the ‘litmus test of ad interim in regard to prayer (a) of the Ad interim/Temporary injunction application. It is to underscore that all other prayers will be decided by this Court after giving an audience to the defendants… It is limpid to this court that if an order of ad interim injunction is not passed, it will cause loss or prejudice to the plaintiff, provided that it has been passed by adhering to the settled rubric pertaining to injunction jurisprudence. It is limpid that the plaintiff has been able to pass the “three pillars triple test” by establishing his prima facie case, showing the balance of convenience and inconvenience tilted in his favour,
and also showing that if the defendants are not prohibited at this stage, then the plaintiff would suffer irreparable loss and injury beyond monetary relief.
22. In the light of the above, considering the urgency of the matter, this court is inclined to allow the prayer for an interim injunction in the form of restraining defendants from disturbing in any manner whatsoever the new peaceful employment of the plaintiff.”
22. The learned Trial Court then proceeded to grant the ad interim relief as indicated by it in the paragraphs quoted hereinabove with the following directions in paragraph 24 thereof:-
“24. Issue notice upon the defendants to show cause within 15 days from the date of receipt of the notice as to why the plaintiff’s prayer for a temporary injunction shall not be made absolute……… ”
23. On a wholesome reading of the order in the light of the prayers made, it will be clear that it is a case where – there were prayers made for ad interim reliefs in the application for injunction; the application was pressed ex-parte for ad interim reliefs; the learned Trial Court considered the application in totality and directed issuance of notice to the defendants to show cause why the plaintiff’s prayer for a temporary injunction shall not be made absolute while observing that the “plaintiff has passed the litmus test of ad interim in regard to prayer (a) of the Ad interim/ Temporary injunction application”.
24. Does this not demonstrate the Court’s implied conclusion that the plaintiff (opposite party) had failed the “litmus test of ad interim” as regards the other prayers, all the more so when the defendants have been called upon to show cause why the plaintiff’s prayer for temporary injunction will not be made absolute? In the prima facie view of this Court, the answer is in the affirmative and the learned Trial Court has impliedly refused the ad interim reliefs at least at the ex-parte
25. There are two reasons for this Court to arrive at such conclusion. Firstly, if the opposite party had passed the tripod test for ad interim injunctions as regards all the ad interim reliefs, then the other ad interim reliefs would have been granted. Secondly, if the learned Trial Court had merely postponed the decision then it would have asked the defendants to show cause why ad interim reliefs as prayed for would not be granted and not “why the plaintiff’s prayer for a temporary injunction shall not be made absolute”. More than three decades back an Hon’ble Division Bench of this Court had in the case of Jagjit Singh Khanna vs. Dr. Rakhal Das Mullick & Another16 succinctly summed up the difference between the two stages of grant of interim reliefs under Order XXXIX Rules 1 and 2 in the following manner:-
“4. Both the applications for ad interim/temporary injunctions must, therefore, be treated as applications under S. 94(c) read with O. 39 of the Code, even though the first one was labelled as one under O. 39 only and the second one as one under S. 94 only. The net question, therefore, is that if a Court has refused ad interim injunction and has only issued notice to show cause on an application for temporary injunction, can it, on a subsequent application, grant ad interim injunction till the disposal of the earlier application for temporary injunction. A temporary injunction may, as it very often does, consist of two stages, one granted without finally disposing of the application for injunction to operate immediately till the disposal of the said application and the other granted while finally disposing of the main application to enure generally till the disposal of the suit and while the former is generally classed as ad interim injunction, the latter is generally called temporary injunction. Neither on principle nor on authority we find any bar to the Courts granting ad interim injunction till the disposal of the application for the temporary injunction, if subsequent developments or altered circumstances warrant such grant, even though it has refused to grant the same earlier on the materials then on record. If, however, the materials on record stand as they stood when the ad interim injunction was refused earlier, a grant of ad interim injunction on such materials may not be permissible as that might amount to impermissible review of the earlier order.”
(Emphasis supplied)
26. This was reiterated by another Hon’ble Single Bench of this Court in the case of Fiona Ray vs. Sipra Roy & Another17 thus:-
“26. On perusal of the provisions contained in Order 39 Rules 1 and 2 as well as the provision contained in Order 39 Rule 3 of the Code of Civil Procedure, this Court has no hesitation to hold that Order 39 Rules 1 and 2 are the only enabling provisions which authorise the Court to pass interim injunction; be it ad interim or temporary. In fact, temporary injunction consists of two stages, i.e., first stage—ex parte ad interim injunction and second stage —contested temporary injunction. Ad interim injunction can be extended upto the disposal of the temporary injunction petition and temporary injunction continues upto the disposal of the suit.”
(Emphasis supplied)
27. Viewed in the light of the aforesaid legal position, the language of the order passed by the learned Trial Court prima facie suggests that the learned Trial Court had impliedly refused all the ex-parte ad interim reliefs except the one in terms of prayer (a).
28. As to whether a case for grant of the other ad interim reliefs was actually made out or not is a different matter altogether. However, in the facts of this case, prima facie, it cannot be said that there was no order under Order XXXIX Rules 1 and 2 of the Code.
29. This Court is alive to the definition of the expression “order” in Section 2(14) of the Code which reads thus:-
“(14). “order” means the formal expression of any decision of a Civil Court which is not a decree;”
30. It can well be argued that deemed refusal of relief is not a formal expression of any decision. It is also noteworthy that while there is a clarification as regards deemed decrees under Section 2(2) of the Code and a provision for implied refusal of reliefs claimed in the plaint, if the same are not expressly granted by the decree, under Explanation V to Section 11 thereof, there is no such provision as regards orders in the Code. In fact excepting cases where interlocutory orders have attained finality18 there can be no application of the principles of res judicata at interlocutory stages (and all the more so for ex-parte ad interim stages).
31. Would it, therefore, mean that in all cases where several ad-interim reliefs have been claimed and pressed ex-parte, grant of only one of them or a few of them while postponing the other would not amount to implied refusal of the said ad interim relief at the ex-parte stage? The answer has to be in the negative. It cannot be so in all cases while it may so in many cases. As settled by the Hon’ble Supreme Court in Shah Babulal Khimji (supra) and reiterated in Shyam Sel And Power Limited & Another (supra) the question has to be answered having regard to the facts of the given case and there cannot be a blanket proposition covering all cases.
32. To wit, there may be cases where ad interim reliefs have not been prayed for and only a prayer for temporary injunction is made. Then there may be cases where ad interim relief has been prayed for but has not been pressed at the ex-parte In all such cases issuance of notice would be clearly a procedural order and appeal would not lie. Say for example an ex-parte ad interim relief against an order of demolition is prayed for and the Court merely issues notice to the defendant, will it in such a situation not amount to an order refusing ad interim injunction? The authoritative dictum of the Hon’ble Supreme Court in the case of Shah Babulal Khimji (supra) which has been followed in Shyam Sel And Power Limited & Another (supra) provides a perfect answer to such a question. In such a case the order would be one that would affect vital and valuable rights of the parties and which work serious injustice to the party concerned and would therefore be appealable.
33. Here again, the question as to whether in the order passed by the learned Trial Court has affected valuable rights of the opposite party and worked serious injustice to him would be a question of facts which would be required to be answered by the learned Appellate Court after examining the facts of the case in the light of the law on the subject.
34. In the present case as already indicated hereinabove, the appeal is one under Order XLIII Rule 1 of the Code which provides for appeals against orders. It is a remedial provision which must be construed reasonably, practically and liberally such that any doubt as regards the right of appeal is resolved in favour of the right.19
35. If the appeal is prima facie maintainable, it would now be required to be examined whether the orders impugned in the revisional applications before this Court suffer from illegality and material irregularity warranting interference.
36. The order dated November 18, 2025 is the main order granting ex-parte ad interim injunction. That needs to be tested first.
37. The petitioners have asserted that the order is unreasoned. The opposite party has on the other hand argued that once an order is rendered after considering the detailed submissions of the appellants, it cannot be said to be unreasoned.
38. The order dated November 18, 2025 has captured the arguments of the opposite party (i.e. the appellant before the learned Appellate Court) in the first two pages and a little less than half of the third page of the order. The reasoning starts thereafter which is reproduced hereinbelow:-
“Heard the Ld. Advocate for the plaintiff/appellant.
Perused the voluminous documents filed by the plaintiff/appellant and other materials on record.
Considering the urgency of the matter and finding prima facie case in favour of the plaintiff in view of the Section 24 and 27 of The Indian Contract Act and Section 50 CA and Section 56 (2)(X) of the Income Tax Act and also finding the balance of convenience and inconvenience in favour of the plaintiff, I am of the opinion that at this stage it is necessary to prevent irreparable loss and injury caused to the plaintiff/appellant. Urgency is also evident from the materials on record and if an ad-interim injunction as per prayer ‘a’ of the instant application for temporary injunction is not passed at this stage, then there is every likelihood of multiplicity of proceedings.
Thus, I am inclined to allow the ad interim order at this stage in respect of prayer (a) of the instant application under Order 39 Rule 1 and 2 read with Section 151 of C.P.C. The prayer of the plaintiff/appellant in respect of anti-suit injunction is refused at this stage as the said relief can be granted sparingly in rare and exceptional circumstances and without affording an opportunity of hearing to the respondents such an order cannot justifiably be passed ex-parte.
Hence, it is,
ORDERED
that the prayer for an order of temporary injunction on ad-interim basis is allowed in favour of’ the appellant in terms of prayer (a) of the application for temporary injunction under Order 39 Rule 1 and 2 read with Section 151 of C.P.C. till 18.12.2025.
The respondents and their men and agents are hereby restrained from taking any step to sell any shares having number 1,00,000 of the plaintiff/appellant in favour of the respondent/defendant no.2 without the leave of this Court till 18.12.2025.
The appellant is directed to comply with the provisions enumerated under Order 39 Rules 3(a) and 3 (b) of C.P.C.
Issue notices.
Fix 18.12.2025 for S/R and A/D.”
39. A perusal of the said order would reveal that the same only states the conclusions which may be summarised thus:-
a) there is prima facie case in favour of plaintiff in view of the provisions of Section 24 and 27 of the Indian Contract Act and Section 50CA and 56(2)(X) of the Income Tax Act
b) finding balance of convenience and inconvenience in favour of the plaintiff
c) urgency is evident from the materials on record- and
d) if ad interim injunction as per prayer ‘a’ of the instant application is not passed at this stage there is every likelihood of multiplicity of proceedings.
40. There is evidently no reason whatsoever to support the conclusions. There is nothing to show how would there be violations of the various provisions of the statutes referred to in the said order. Again there is no reason to justify why and how the balance of convenience and inconvenience tilted in favour of the appellant/opposite party. Yet again, there is nothing to convey which material on record persuaded the Court to reach the conclusion that there was such an urgency involved in the matter that ex-parte ad interim injunction was required to be granted. The learned Appellate Court has ultimately held that if ad interim injunction is not passed there would be multiplicity of proceedings but here again there is no discussion how there would be multiplicity of proceedings. While on this it may be noted that the learned Appellate Court has refused the appellant’s prayer for anti-suit injunction.
41. In this context, paragraph 58 of judgment of the Hon’ble Supreme Court in the case of Asma Lateef & Another (supra) relied on by the petitioners becomes highly relevant. The same is reproduced hereinbelow:-
“58. It is one of the cardinal principles of the justice delivery system that any verdict of a competent judicial forum in the form of a judgment/order, that determines the rights and liabilities of the parties to the proceedings, must inform the parties what is the outcome and why one party has succeeded and not the other — the “why” constituting the reasons and “what” the conclusion. Apart from anything else, insistence of the requirement for the reason(s) to support the conclusion guarantees application of mind by the adjudicator to the materials before it as well as provides an avenue to the unsuccessful party to test the reasons before a higher court.”
42. Uniworth Resorts Limited & Another (supra), a judgment rendered by an Hon’ble Single Judge of this Court, is also apposite to the context. Paragraph 11 thereof deserves notice:-
“11. Judicial orders of such nature need to meet the twin tests of “why” and “what”. It is the “why” that sustains the “what”. Reasons are the safeguard against the ipse dixit of the decision making process. They discuss how the judicial mind has been applied to the matter in issue and convey the nexus between the matters that have been considered and the conclusion based thereon. The justification and the reasonableness of a conclusion depend on the reasons given in support thereof. The order impugned has no element of “why” for the “what” therein to stand on.”
43. It must be borne in mind that the order passed by the learned Appellate Court is one where the learned Appellate Court has granted something which was not granted by the learned Trial Court. To be precise, the order impugned is not a case of affirmation. Seen in such context the following observations of the Hon’ble Supreme Court in paragraphs 5 and 6 of the judgment in the case of Sailesh Bhansali (supra) become very relevant:-
“5. Law is well settled that an order of affirmation may not require elaborate reasons as required in the case of an order of reversal but it does not mean that such order of affirmation need not contain any reason at all. Whether or not there was application of mind can only be disclosed by reason, howsoever briefly alluded to. If any authority is required, one may profitably refer to the decision of this Court in Rani Lakshmi Bai Kshtriya Gramin Bank v. Jagdish Sharan Varshney.
6. What follows from the above is that the ‘what’, i.e., the conclusion, must have the ‘why’, i.e., the reasons (at least in brief), to stand on, which is conspicuous by its absence in the impugned order of affirmation. On this short ground, we set aside the revisional order of the BCI.”
44. The Hon’ble Supreme Court has in the case Bloomberg Television Production Services India Private Limited & Others vs. Zee Entertainment Enterprises Limited20 reiterated the well settled legal requirements that are to be fulfilled by a Court while considering a prayer for ex-parte ad interim relief. That was also a case where the order under consideration was somewhat similar to the one at hand. The Hon’ble Supreme Court has in paragraph 2 of the judgment quoted the relevant paragraph containing the reasons assigned by the learned Trial Court and then observed as follows:-
“4. The threefold test of establishing: (i) a prima facie case, (ii) balance of convenience, and (iii) irreparable loss or harm, for the grant of interim relief, is well-established in the jurisprudence of this Court. This test is equally applicable to the grant of interim injunctions in defamation suits. However, this threefold test must not be applied mechanically [DDA v. Skipper Construction Co. (P) Ltd., (1996) 4 SCC 622, para 38 : (1997) 89 Comp Cas 362.] , to the detriment of the other party and in the case of injunctions against journalistic pieces, often to the detriment of the public. While granting interim relief, the court must provide detailed reasons and analyse how the threefold test is satisfied. A cursory reproduction of the submissions and precedents before the court is not sufficient. The court must explain how the test is satisfied and how the precedents cited apply to the facts of the case.
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10. The order of the trial Judge does not discuss, even cursorily, the prima facie strength of the plaintiff’s case, nor does it deal with the balance of convenience or the irreparable hardship that is caused. The trial Judge needed to have analysed why such an ex parte injunction was essential, after setting out the factual basis and the contentions of the respondent made before the trial Judge. The trial Judge merely states, in paras 7-8, that the court has “gone through the record available as on date” and noticed certain precedents where an ad interim injunction was granted. Without even cursorily dwelling on the merits of the plaint, the ad interim injunction granted by the trial Judge amounts to unreasoned censorship which cannot be countenanced.
11. Undoubtedly, the grant of an interim injunction is an exercise of discretionary power and the appellate court (in this case, the High Court) will usually not interfere with the grant of interim relief. However, in a line of precedent, this Court has held that appellate courts must interfere with the grant of interim relief if the discretion has been exercised “arbitrarily, capriciously, perversely, or where the court has ignored settled principles of law regulating the grant or refusal of interlocutory injunctions”. [Ramdev Food Products (P) Ltd. v. Arvindbhai Rambhai Patel, (2006) 8 SCC 726, paras 126 & 128; Shyam Sel & Power Ltd. v. Shyam Steel Industries Ltd., (2023) 1 SCC 634, para 37 : (2023) 1 SCC (Civ) 301.] The grant of an ex parte interim injunction by way of an unreasoned order, definitely falls within the above formulation, necessitating interference by the High Court. This being a case of an injunction granted in defamation proceedings against a media platform, the impact of the injunction on the constitutionally protected right of free speech further warranted intervention.
12. In view of the above, the High Court ought to have, in our view, also at least prima facie assessed whether the test for the grant of an injunction was duly established after an evaluation of facts. The same error which has been committed by the trial Judge has been perpetuated by the Single Judge of the High Court. Merely recording that a prima facie case exists, that the balance of convenience is in favour of the grant of injunction and that an irreparable injury would be caused, would not amount to an application of mind to the facts of the case. The threefold test cannot merely be recorded as a mantra without looking into the facts on the basis of which an injunction has been sought. In the absence of such a consideration either by the trial Judge or by the High Court, we have no option but to set aside both the orders of the trial Judge dated 1-3-2024 and of the Single Judge of the High Court dated 14-3-2024 [Bloomberg Television Production Services India (P) Ltd. v. Zee Entertainment Enterprises Ltd., (2024) 4 HCC (Del) 99]. We do so accordingly.”
45. The situation in the present case is no different from what was there before the Hon’ble Supreme Court. The relevant portion of the order dated November 18, 2025 passed by the learned Appellate Court has already been extracted hereinabove which would reveal that the same also only records the submission of the learned Advocate for the appellant (i.e. the opposite party herein) and then reaches the conclusions. This Court is cognisant of the fact that Bloomberg Television Production Services India Private Limited & Others (supra) was a case of defamation, but the principles stated therein are of universal application to matters pertaining to grant of ex-parte ad interim injunctions.
46. It had been argued by the petitioners that the learned Appellate Court has passed an order of injunction restraining the petitioners from selling the subject shares without appreciating that such an interim relief had not been prayed for by the opposite party before the learned Trail Court.
47. The opposite parties have on the other hand argued that both prayer ‘e’ of the injunction application before the learned Trial Court seeking a direction on the defendants to sell the shares at the reserve price or at such price as determined by the learned Court and prayer ‘a’ of the application for injunction before the learned Appellate Court seeking restraint orders on the defendants from selling the shares of the opposite party, are aimed at protecting the subject matter of the suit and they do not run contrary to one another.
48. The prayers made in the injunction application before the learned Trial Court, have already been quoted hereinabove. Now the prayers made in the injunction application filed before the learned Appellate Court need to be noticed. The same are, as under:-
a. An order for temporary injunction restraining the Respondents/Defendants and/or their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or successor-in-office and/or directors, and/or shareholders, and/or any other person/s in association with and/or in connection with the Respondents/Defendants from taking any steps to sell and/or from selling any shares having number 100,000 of the plaintiff in favour of the Respondents/Defendant No. 2 without the leave of the Learned Court;
b. An order for temporary injunction restraining the Respondents/Defendants and/or their men and agents and/or servants and/or assigns and/or heirs and/or successor-in-interest and/or successor-in-office and/or directors, and/or shareholders, and/or any other person/s in association with and/or in connection with the Respondents/Defendants from taking any steps to institute and/or from instituting any proceeding/s without the leave of This Learned Court;
49. On a comparison of the two sets of prayers it will be evident that prayer ‘e’ made before the learned Trial Court is clearly inconsistent with prayer ‘a’ made before the learned Appellate Court.
50. While the former is a prayer for mandatory injunction directing the defendants to sell at a particular price the latter is one for prohibiting the defendants from selling the shares at all. The opposite partys’ argument therefore, fails to appeal.
51. Rather, on a deep analysis, prayer ‘d’ of the injunction application before the learned Trial Court can, in a sense, be said to be gravid with prayer ‘a’ before the learned Appellate Court. To be precise, prayer ‘a’ before the learned Appellate Court is a request for injunction on a portion of the SHA as well as the AoA where 9under the parties (i.e. the petitioners and the opposite party) had agreed to a share-buyback mechanism. If it is compared with the prayer ‘d’ made in the application for temporary injunction before the learned Trial Court, it would be clear that prayer ‘a’ before the learned Appellate Court is a subset of prayer ‘d’ before the learned Trial Court. It can be argued that if prayer ‘d’ before the learned Trial Court had been granted prayer ‘a’ before the learned Appellate Court would have stood answered anyway because in such case the petitioners would not have been able to act in terms of the SHA and the AoA and consequently could not have enforced the buyback of shares.
52. However, even if the matter is viewed from such angle, the problem does not get solved and that by itself does not make the order dated November 18, 2025 any better.
Firstly, the moment the prayers are so interpreted, the order dated November 18, 2025 assumes the character of an order of reversal in the sense that what was impliedly refused by the learned Trial Court has been granted by the learned Appellate Court. In fact the learned Appellate Court has explicitly observed so in the fourth paragraph at the first page of the order. That being the position, the learned Appellate Court was required to return a threshold prima facie finding indicating, as to why was the order passed by the learned Trial Court bad in not granting the other ex-parte ad interim reliefs to the opposite party. There is, however, neither any discussion nor any prima facie finding on such aspect in the order dated November 18, 2025.
53. Secondly, while considering prayer ‘d’, the learned Trial Court assessed the prima facie case, balance of convenience and inconvenience and irreparable injury for a blanket freeze on the entire contract and it was never required to weigh the balance of convenience specifically regarding sale of shares. The learned Appellate Court on the contrary has granted a specific injunction without any prima facie finding as to how the learned Trial Court erred in doing what it did. It is well settled that the scope of an appeal under Order XLIII Rule 1 of the Code is limited to examining the correctness of the order under challenge before it. While examining such order at ex parte at the ad interim stage, will the learned Appellate Court, be entitled to pass an order which was never explicitly prayed for before the learned Trial Court? Such a question would be required to be answered by the learned Appellate Court.
54. Thirdly and most importantly, if such a prayer had been asked for by the opposite party before the learned Trial Court and the learned Trial Court had granted it, then the petitioner would have had a forum for appeal. Making a prayer for the first time in the learned Appellate Court without expressly asking for the same before the learned Trial Court would rob the opposing party of a forum of appeal as has happened in the present case. This aspect would also be required to be considered by the learned Appellate Court while considering the opposite party’s prayer for injunction.
55. Extensive arguments were made by the petitioners on the point that the learned Appellate Court’s conclusion that “there is prima facie case in favour of plaintiff in view of the provisions of Section 24 and 27 of the Indian Contract Act and Section 50CA and 56(2)(X) of the Income Tax Act” is entirely wrong inasmuch as FEMA violations cannot be said to be void. In such context reliance was placed on Vijay Karia & Others (supra). The opposite party on the other hand relied on Griesheim GMBH (supra) to contend that any foreign judgment rendered sustaining a claim founded on breach of FEMA laws and regulations framed thereunder would be inexecutable in India. Regulation 9 of the Foreign Exchange Management (Overseas Investment) Regulations, 2022 and Rule 16 of the Foreign Exchange Management (Overseas Investment) Rules, 2022 and clauses 2.2, 3.1 and 4.2 of the RBI Circular to contend that violation of Rule 16 is non-compoundable.
56. However, since the order dated November 18, 2025 contains no reason in support of the ultimate conclusions that it indicates, it would not be proper for this Court to test such conclusion and return a finding on the merits of the arguments made by the parties without first knowing what weighed with the learned Appellate Court to reach such conclusion and without the Courts of facts rendering the findings at the first instance. That would, in a sense, lead to the assessment of the prima facie case of the opposite party by the High Court under its supervisory jurisdiction at the threshold, which should be avoided.
57. While it is true that this Court, in exercise of its jurisdiction under Article 227 of the Constitution of India, can supply reasons if the ultimate conclusion is correct but then that can be done only when the reasons assigned in support of such conclusion are either inadequate or not fully right and not when there is no reason at all. It is clarified that this observation does not mean that the conclusion reached by the learned Appellate Court is correct. Such observation is only intended to explain that the said conclusion cannot be tested by this Court in a vacuum. The order dated November 18, 2025 therefore, deserves interference.
58. Moving on to the next order dated December 18, 2025, this Court finds that the said order too deserves intervention. That is an order whereby the injunction granted earlier was extended by the learned Appellate Court overruling the petitioners’ objection as regards the territorial jurisdiction of the Court. The learned Appellate Court has postponed the decision on the objection to territorial jurisdiction by observing as follows:-
“….. Upon hearing both the sides and on appreciation of the appearing circumstance, specifically the fact that the ad interim order dated 18-11-2025 as passed by the Learned Judge-in-charge of this Court has been placed under challenge before the Hon’ble High Court at Calcutta in C.O.No.4439 of 2025, the matter being subjudice, this Court is of its prima facie view that passing any order pending challenge before the Hon’ble Court is contrary to the principles of judicial propriety and comity and when the matter is pending before the Hon’ble High Court at Calcutta, this Court should restrain and avoid passing order that could circumvent, prejudice or render infructuous the proceeding. It has also been settled by the Hon’ble Courts that once an appeal is filed, the decision loses its character of finality and what was once res judicata again becomes res sub-judice, i.e., a matter under judicial inquiry. Therefore, at this juncture, this Court is of its opinion that when a revisional application has been filed against the order of this Court before the Hon’ble High Court, the same issue becomes a pending matter. Accordingly, this Court as on this day strictly avoids to set aside the order which is already under challenge before the Hon’ble Court as per the prayer of the respondents that the Civil Court in India has no territorial jurisdiction to try the case on the basis of contractual obligations between the parties to the suit and the order from the Court in U.K. is binding upon the party to the Suit/Appeal.”
59. The reason assigned to extend the ad interim injunction granted ex parte fails to prop the extension, even feebly. It is no reason at all, so to say. It well settled that at the time of considering prima facie case the Court must be prima facie satisfied with the existence of its jurisdiction to entertain such suit, be it territorial, pecuniary or inherent21. Thus when the petitioners raised the point of lack of territorial jurisdiction of an Indian Court to entertain the suit and therefore the appeal, the point should have been addressed by the Court at least prima facie before extending the order of injunction.
60. In such context the judgment of the Hon’ble Supreme Court in Asma Lateef & Another (supra), which has been cited by the petitioners, provides an insightful guidance in paragraph 50 thereof. The same is reproduced hereunder:-
“50. Although not directly arising in the present case, we also wish to observe that the question of jurisdiction would assume importance even at the stage a court considers the question of grant of interim relief. Where interim relief is claimed in a suit before a civil court and the party to be affected by grant of such relief, or any other party to the suit, raises a point of maintainability thereof or that it is barred by law and also contends on that basis that interim relief should not be granted, grant of relief in whatever form, if at all, ought to be preceded by formation and recording of at least a prima facie satisfaction that the suit is maintainable or that it is not barred by law. Such a satisfaction resting on appreciation of the averments in the plaint, the application for interim relief and the written objection thereto, as well as the relevant law that is cited in support of the objection, would be a part of the court’s reasoning of a prima facie case having been set up for interim relief, that the balance of convenience is in favour of the grant and non-grant would cause irreparable harm and prejudice. It would be inappropriate for a court to abstain from recording its prima facie satisfaction on the question of maintainability, yet, proceed to grant protection pro tem on the assumption that the question of maintainability has to be decided as a preliminary issue under Order 14 Rule 2CPC. That could amount to an improper exercise of power. If the court is of the opinion at the stage of hearing the application for interim relief that the suit is barred by law or is otherwise not maintainable, it cannot dismiss it without framing a preliminary issue after the written statement is filed but can most certainly assign such opinion for refusing interim relief. However, if an extraordinary situation arises where it could take time to decide the point of maintainability of the suit and non-grant of protection pro tem pending such decision could lead to irreversible consequences, the court may proceed to make an appropriate order in the manner indicated above justifying the course of action it adopts. In other words, such an order may be passed, if at all required, to avoid irreparable harm or injury or undue hardship to the party claiming the relief and/or to ensure that the proceedings are not rendered infructuous by reason of non-interference by the court.”
61. The aforequoted paragraph would reveal that if the Court is of opinion at the stage of hearing the application for interim relief that the suit is not maintainable it will assign such reason for refusing interim relief. Asma Lateef & Another (supra) has after mandating that decision as regards jurisdiction or maintainability must precede an order granting injunction, clarified that even in cases where taking final decision may lead to irreversible consequences, the learned Court is still required to form at least a prima facie opinion about the maintainability of the suit before passing an order of injunction. The assertive instruction that “if an extra ordinary situation arises where it would take time to decide point of maintainability of the suit and non-grant of protection pro tem pending such decision could lead irreversible consequences the Court may proceed to make an appropriate order in the manner indicated above justifying the course of action it adopts” clearly reveals that the Court is not relieved of its duty to return a prima facie finding as regards the maintainability of the suit before passing an order of injunction.
62. There is in fact no justification in the order dated December 18, 2025 passed by the learned Appellate Court for extending the order of injunction. The learned Appellate Court has in effect only postponed the decision merely because of pendency of a revision before this Court and has extended the injunction. That is not the mandate of law.
63. It cannot be gainsaid that Court can in appropriate cases, not covered by Section 94 read with Order XXXIX Rules 1 and 2 of the Code use its inherent power to pass an order of injunction but then that can also be done only if, at the first place the Court has jurisdiction to pass such order. Decision as to jurisdiction is therefore imperative.
64. It was also argued before this Court that the learned Trial Court and the learned Appellate Court lack jurisdiction to deal with the matter since the situs of the shares which form the subject matter of the lis is at UK and there is an exclusive jurisdiction clause in the SHA. Vodafone International Holdings BV (supra) was cited to assert that the situs of the shares would be at the place where the relevant company is incorporated and/or the place where the share can be dealt with by way of transfer. It was contended that since the relevant company is incorporated in UK and the subject shares are to be dealt with at UK, therefore, Indian Court would not have jurisdiction over the same.
65. Modi Entertainment Network & Another (supra) was placed to demonstrate that the principle that parties cannot by agreement confer jurisdiction on a Court that lacks it applies to Courts to which the Code applies but this principle cannot be extended to jurisdiction of foreign Courts and that in such cases, the English Courts permit invocation of their jurisdiction. Relying on the said judgment, it was stressed that a Court of natural jurisdiction would normally not grant anti-suit injunction against a defendant before such Court if the parties have agreed to submit to the exclusive jurisdiction of another Court including foreign Court save in exceptional circumstances for sufficient reasons in order to prevent injustice.
66. The opposite party has on the other hand cited Taprogge Gesellschaft MBH (supra) and Regazzoni (supra) to counter the salvo aimed at the Court’s jurisdiction.
67. Here again, this Court would refrain for returning any finding on the jurisdiction of the learned Courts to entertain the suit and hence the appeal on the grounds urged, since the same ought to be decided by the same Court where it was first raised i.e. the learned Appellate Court itself, at the threshold while deciding the prima facie case of the opposite party.
68. In view of the discussion made hereinabove, the orders dated November 18, 2025 and December 18, 2025 cannot be sustained. The same therefore stand set aside.
69. Insofar as the orders of extension of the initial order of injunction dated January 21, 2026, March 02, 2026, April 09, 2026 and order dated May 06, 2026 (included as a part of C.O. 1513 of 2026 by way of a supplementary affidavit on May 21, 2026 upon leave granted by this Court) are concerned, the same do not have any independent existence. The same are dependent on the parent order dated November 18, 2025. Once the same is set aside all of them would lose life instantly following the doctrine of dependant orders22. It now well settled that orders of extension granted routinely, without any fresh and independent application of mind are not required to be challenged separately23.
70. The opposite party shall be entitled to renew its prayer for injunction on the next date fixed and shall also be at liberty to pray for preponement of the date upon prior notice to the petitioners, subject to the convenience of the learned Court. It is however made clear that before taking any decision the learned Appellate Court must arrive at a finding as regards the jurisdiction of the Court, at least prima facie apart from the other essential prima facie findings and considerations required for deciding a request for injunction.
71. However, since the interim order that has continued thus far is getting vacated and this Court has prima facie found the opposite party’s appeal to be maintainable, therefore, just by way of a short term equitable measure, it is directed that if the petitioners are desirous of taking any step as regards the subject shares at any time within a week from date, the petitioners would do so only upon putting the opposite party on three working days’ prior written notice either by e-mail or physical mail.
CONCLUSION:
72. C. O. 4439 of 2025 along with the connected applications, C.O. 224 of 2026, C.O. 431 of 2026, C.O. 1513 of 2026 and C.O. 1052 of 2026 stand disposed of with the above observations. No costs.
73. Urgent photostat certified copy of this order, if applied for, be supplied to the parties on urgent basis after completion of necessary formalities.
Note:
1(2023) 1 SCC 634
2 (2024) 4 8CC 696
3 (2012) 6 8CC 613
4 (2003) 4 SCC 341
5 (1990) 3 SCC 481
6 2025 SCC OnLine SC 512
7 2007 SCC OnLine Cal 535
8 Hereafter “the 1961 Act”
9 (2020) 11 SCC 1
10 1987 SCC OnLine Bom 345
11 [1956] 2 Q.B. 490
12 Wrongly written as “NAFED vs. Alimenta SA” in the written notes of argument on behalf of the opposite parties
13 2026 SCC OnLine SC 648
14 Hereafter “Letters Patent”
215 (1981) 4 SCC 8
16 1987 SCC OnLine Cal 88 : AIR 1988 Cal 95 : (1987-88) 92 CWN 190
17 (2008) 2 CHN 402
18Satyadhyan Ghosal vs. Deorajin Debi, 1960 SCC OnLine SC 15 Arjun Singh vs. Mohindra Kumar, 1963 SCC OnLine SC 43
19 V .C. Shukla vs. State through CBI, 1980 Supp SCC 92; CIT vs. Ashoka Engineering Co., 1993 Supp (1) SCC 754
20 (2025) 1 SCC 741
21 Axis Bank Ltd. vs. MPS Greenery Developers Ltd., (2010) 3 CHN 112 (Cal)
22 Rikhabsao Nathusao Jain vs. Corpn. of the City of Nagpur, (2009) 1 SCC 240
23 Karnani Properties Limited vs. Harrow Hall, a Registered Society & Ors.; (2025)1 CHN 630
