ORDER
1. The plaintiffs have filed this suit for a declaration that the plaintiffs are the owners of Flat No. 31-A situate on the 3rd floor of the building known as Darshan Apartments, Mount Pleasant Road, Bombay, and of Garage No. 35 situate thereat and of 125 shares of defendant No. 3 Society represented by Share Certificates Nos. 28, 86 and 122 and for a negative declaration that defendant No. 1 and/or defendant No. 2have no right, title or interest in the said flat or the said garage or the said shares and for a direction against defendants Nos. 1 and 2 to do all things necessary to complete the title of the plaintiffs in respect of the said flat, the said garage and the said shares.
2. By this notice of motion, the plaintiffshave sought an interim injunction restraining the defendants Nos. 1 and 2 from proceeding with R.A.F. & R. Suit No. 918/4826 of 1976 filed in the Court of Small Causes at Bombay against the plaintiffs till the hearing and final disposal of this suit.
3. This notice of motion involves an interesting question of law as to the jurisdiction of this Court to grant such an injunction as sought for.
4. Mr. Desai, the learned counsel for the defendants Nos. 1 and 2, has submitted that this Court functioning on the Original Side has no jurisdiction to grant such an injunction in view of the provisions of the law contained in Section 41(b) of the Specific Relief Act, 1963. Mr. Desai has contended that the Court of Small Causes at Bombay functioning as a Court of exclusive jurisdiction under Section 28 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (hereinafter referred to as the Bombay Rent Act) cannot be considered as a Court subordinate within the meaning of the said expression used in Section 41(b) of the Specific Relief Act.
5. I propose to deal with the question of law argued by the learned counsel on both sides in the first instance. If I hold that this Court has jurisdiction to grant the prayer for injunction sought for, I shall proceed to consider as to whether a case is made out for grant of such an injunction.
6. It appears to me to be well-settled by now that the powers of Chartered High Courts to grant orders of injunction are not limited by the provisions contained in the Code of Civil Procedure, 1908. It appears to me to be well-settled that Chartered High Courts in this country have general equity jurisdiction to grant injunction in appropriate cases independently of the provisions of the Code. Sir D.F. Mullain his standard work on the Code of Civil Procedure, 14th Edition, at page 2141, has summarised the law on the subject under the heading 'Power of Chartered High Courts 'to restrain a party' from proceeding with a suit pending in another Court'.
7. In the case of Rash Behary Dey v.Bhowani Churn Bhose, ILR (1907) Cal 97, the Hon'ble Mr. Justice Woodroffe held that the High Court has jurisdiction to grant an order of injunction restraining the defendant before it from proceeding with a suit instituted by the defendant in the Court of Small Causes. In that case, the plaintiff had instituted a suit in the High Court for specific performance of an agreement of lease in respect of certain premises and the defendant had filed an ejectment suit against the plaintiff in the Court of Small Courses in respect of the same premises. In the above-referred judgment, Woodroffe, J. observed that the High Court had power to grant the order of injunction sought for independently of the Code of Civil Procedure and issued the order of injunction restraining the defendants from proceeding with the suit in the Court of Small Causes.
8. In Uderam Kesaji v. Hyderally Abdul Kayum : (1908)10BOMLR1141 , a similar question arose before our High Court in a suit filed on the Original Side. In this suit, the plaintiff had sought an injunction against the defendant from proceeding further with a suit pending in the Court of Small Causes at Bombay in respect of the same matter to which the suit in the High Court related. The question of jurisdiction of this Court to grant such an injunction by exercise of power on its Original Side was in terms raised by the learned counsel for the defendant. The Hon'ble Mr. Justice Macleod traced the history of equity jurisdiction of this Court in this case from the year 1823. By Letters Patent of 1823, the Supreme Court of Bombay was empowered to make such further and other interlocutory orders as the justice of the proceeding might seem to require. By the said Letters Patent, it was further ordained that the then Supreme Court situate in the Presidency Towns should also be a Court of Equity. When the High Courts were established in replacement of the former Supreme Courts by the High Courts Act of 1861, the same powers and jurisdiction were conferred by statute on the Chartered High Courts under S. 9 of the High Courts. Act of 1861. Clause 19 of the Letters Patent of 1865 provided that the High Court in the exerciseof the Ordinary Original Civil Jurisdiction shall administer such law of equity which would have been applied by the High Court if the Letters Patent had not been issued. The learned counsel for the defendant in this case relied upon Section 53 of the old Specific Relief Act, which provided that temporary injunctions shall be regulated by the Code of Civil Procedure. It is well-settled by this time that this provision or similar corresponding provision in the Specific Relief Act, 1963 cannot be construed to mean that the power of the Chartered High Court to grant injunction is restricted to category of matters falling under Order 39 of the Code. The High Courts can grant injunction in appropriate cases in exercise of their inherent power as well as succession of equity jurisdiction. Following a series of judgments delivered by the High Court of Calcutta, noticed in the case of Uderam Kesaji ILR (1907) Cal 97 (supra), Macleod, J. held that the High Court on the Original Side had the requisite power to grant the kind of injunction as was sought for.
9. A similar question arose before the Full Bench of our High Court in the case of Narayan Vithal Samant v. Jankibai Sitaram Samant, : AIR1915Bom146 . The question referred to the Full Bench was as to whether the High Court on the Original Side could grant an injunction in the form of an order of prohibition addressed to a subordinate Judge before whom the proceeding was pending, it was held by the Full Bench that an order in personam could be passed restraining a party to the suit from proceeding further with the suit pending in the mofussil Court, but no order of stay of the proceedings as such could be passed by the High Court in exercise of its Original jurisdiction. The Full Bench of our High Court made specific distinction between the order of stay addressed to the Courts staying the proceedings pending before it and the orders of injunction passed against a party before it restraining the party from proceeding further with the pending suit. Power to grant stay of a suit pending in another Court could be exercised by the High Court on the Appellate Side and not on the Original Side. It is well-settled that equity acts in personam. The High Courts have alwaysexercised their equity jurisdiction on the Original Side by restraining a party before it from proceeding further with a pending suit in a subordinate Court provided proper case Was made out. An order of injunction stands on a different footing than order of stay. In some cases the parties before this Court have been restrained from proceeding further with the suit or proceeding pending before a foreign Court. It is not necessary to decide the question of power of this Court to grant injunction to restrain a party from proceeding further with a pending suit in a Court not subordinate to High Court. All I have to consider is as to whether this Court seized of the matter on the Original Side can grant an injunction against a party defendant in a suit restraining the party from proceeding further with a pending suit in a Court which is subordinate to the High Court. The distinction between stay order and order of injunction in matters of this kind is well recognised by our legal system. For this very reason, Section 41(b) of the Specific Relief Act uses different terminology as compared to the terminology used in Section 56(b) of the old Specific Relief Act. The discussion of the case law on the subject will not be complete without referring to the judgment of Kania, J. in the case of Dhanraj Yugulkishore & Co. v. Babulal Ramchandra : AIR1943Bom206 . In this case also, it was held by our High Court that there was nothing in law to prevent a Court on the Original Side of a Chartered High Court from granting an injunction to restrain a defendant from proceeding with a suit in another Court. In this matter also, the High Court considered the notice of motion for grant of a similar injunction in a pending suit filed by the plaintiff on the Original Side of our Court.
10. Mr. Desai, the learned counsel for defendants Nos. 1 and 2, has rightly invited my attention to the judgment of the Supreme Court in the case of Cotton Corporation ofIndia v. United Industrial Bank : [1983]3SCR962 . In this case in an appeal against an order passed on a notice of motion in a suit instituted on the Original Side of our Court, the Division Bench of our High Court restrained a party from instituting a windingup petition. The Supreme Court held that injunction could not be granted by the Court against a party restraining it from instituting or prosecuting a proceeding in a Court of co-ordinate or superior jurisdiction. A winding up petition could be filed only in the High Court. It was held by the Supreme Court that interim injunction could be granted by the Court against a party before the High Court restraining it from instituting or prosecuting a proceeding in a subordinate Court and not a co-ordinate Court or a superior Court. The Supreme Court set aside the order of Division Bench of the High Court as it had restrained a party from instituting a proceeding in High Court which was beyond its powers in view of Section 41(b) of the Specific Relief Act, 1963. 1 am bound by this judgment of the Hon'ble Supreme Court in Cotton Corporation's case (supra). I am also in humble and respectful agreement with the ratio of the said case. The ratio of the above-referred case does not preclude the High Court on the Original Side from granting an injunction restraining defendants Nos. 1 and 2 from proceeding further with the suit pending in the Court of Small Causes at Bombay in an appropriate case.
11. Section 6 of the Presidency Small Cause Courts Act, 1882 provides that the Court of Small Causes at Bombay shall be deemed to be a Court subordinate to the High Court. The said Court is subject to the superintendence of the High Court of Judicature at Bombay within the meaning of the said expression used in the Letters Patent. The question to be asked is; Does it make any difference to the question of subordination within the meaning of Section 41(b) of the Specific Relief Act, 1963 merely because the Court of Small Causes at Bombay exercises exclusive jurisdiction under Section 28 of the Bombay Rent Act? In my judgment, it makes no difference whatsoever. The Court of Small Causes at Bombay continues to be subordinate to the High Court even when it exercises its jurisdiction under the Bombay Rent Act. All orders passed by the Court of Small Causes at Bombay under the Bombay Rent Act are subject to the revisional jurisdiction of the High Court under Section 115 of theCode. The High Court has jurisdiction, both on the Original Side as well as Appellate Side, to grant an injunction of the kind sought for if an appropriate case is made out for exercise of judicial discretion and equities of situation warrant it.
12. There is one more aspect which must be considered before I conclude the discussion on this question. Section 29A of the Bombay Rent Act specifically provides that nothing contained in Section 28 or Section 29 shall be deemed to bar a party to a suit, proceeding or appeal mentioned therein in which a question of title to premises arises and is determined, from suing in a competent court to establish his title to such premises, Thus the Court of competent jurisdiction seized of a title suit must necessarily have all ancillary powers to do justice in the matter including granting of an injunction restraining a party from proceeding with a suit pending in the subordinate Court including the Rent Court. If a declaratory suit is pending in the High Court on the Original Side where the question is as to whether 'A' and 'B' are owners of a building and on the basis of some sort of averment 'A' files a suit in the Court of Small Causes against the defendant by pleading that the defendant was the tenant of the plaintiff in respect of the same very premises, can it be said that the High Court has no power to restrain the defendant from proceeding further with the suit pending before the Court of Small Causes at Bombay even if it is of the view that grant of such an injunction is necessary to prevent multiplicity of proceedings? The answer to this question is self-evident. In view of the above discussion, I hold that this Court has jurisdiction to grant an injunction against defendants Nos. 1 and 2 from proceeding further with the suit pending in the Court of Small Causes at Bombay, provided justice of the case so requires and equities of the situation justify the grant thereof.
13. I shall now revert to the facts:
(a) On 12th October 1954, William Jacks &Co.; Ltd. (a company incorporated andregistered in U.K.) acquired the suit flat, thegarage and the shares on ownership basis. Thesaid company was accepted as a Member by the 3rd defendant Society. The said company thus held the suit premises and the shares on ownership basis.
(b) On 1st August 1968, the plaintiff company took over the business of the above-referred U.K. company. The plaintiffs thus acquired title to the suit premises and the said shares. The defendant No. 3 transferred the said shares in favour of the plaintiffs sometime in the month of August 1969. By this time the plaintiffs in its own right and in its own name became the owner of the said flat, the garage and the shares.
(c) At all material times, defendant No. 2 was an employee director of the plaintiff company.
(d) It is the case of the plaintiffs in paragraph 5 of the plaint that due to unavoidable circumstances, the plaintiffs had to effect a partial closure of the business in India and in that situation in July 1970 it was decided to transfer the suit premises and the shares to the name of defendant No. 2, an employee director of the plaintiffs, or his nominee on the understanding that as and when defendant No. 2 ceased to be a director and/or employee of the plaintiffs, the shares and the said premises would be retransferred to the name of the plaintiffs. It is the case of the plaintiffs that according to the mutual understanding between the plaintiffs, defendant No. 1 and defendant No. 2, the plaintiffs caused the said shares and the suit flat and garage to be transferred to the name of defendant No. 1. The defendant No. 1 paid a sum of Rs.23,125/- to the plaintiffs.
(e) It emerges from such record as is available to this Court at this stage that a sum of Rs. 1450/- per month was the amount payable to the Society towards the monthly outgoings. It is the case of the plaintiffs that the plaintiffs paid this amount to defendant No. 1 Society directly, ostensibly for and on behalf of defendant No. 1. The defendant No. 2 employee was in possession of the said flat and garage for some time.
(f) On 30th November 1970, the defendant No. 2 resigned as a director of the plaintiffs.
(g) On 29th January 1971 i.e. soon after the resignation of defendant No. 2 as the director, the defendant No. 1, who is the wife of defendant No. 2, executed a transfer deed re-transferring the said shares to the name of the plaintiffs. The plaintiffs paid a sum of Rs. 26,529.50 to the defendant No. 1 towards repayment of Rs. 23, 125/- and certain expenses incurred by defendant No. 1. The plaintiffs got back possession of the suit premises from defendants Nos. 1 and 2. The defendant No. 3 Society did not transfer the shares to the name of the plaintiffs on the ground that no transfer could be effected within a period of less than one year. The plaintiffs are thus in uninterrupted possession of the flat and the garage since February 1971. The plaintiffs have been paying all the outgoings of the Society pertaining to the suit flat and the suit shares.
(h) The defendant No. 1 contends that she is the owner of the suit flat and the suit garage. The defendant No. 1 contends that in August 1970, she created a monthly tenancy in respect of the suit flat and the suit garage in favour of the plaintiffs on monthly rent of Rs. 1450/-. It appears that this amount alleged to be stipulated as monthly rent is nothing else but the amount of outgoings which was paid by the plaintiffs to the Society either directly or through the medium of defendant No. 1. Prima facie, there appears to be no justice in the case of the defendants Nos. 1 and 2. On 3rd September 1976, the defendant No. I filed a suit against the plaintiffs in the Court of Small Causes at Bombay on the basis of an averment that the plaintiffs had failed to pay the rent in respect of the suit premises and the plaintiffs were liable to be evicted therefrom under Ss. 12 and 13 of the Bombay Rent Act. Prima facie, the plea of tenancy or the plea of defendant No. 1 continuing to be the owner of the suit flat, garage and shares is unconvincing. Of course, the issues will be tried finally at the hearing of this suit.
14. It is obvious to me that prima facie there are no equities in the case of defendant No. 1. Prima facie, the defendants Nos. 1 and 2 have no beneficial interest in the suit flat, the garage and the shares.
15. Issues of facts and law will have to be tried at the hearing of this suit.
16. After this suit is disposed of, whatever survives in the suit pending in the Court of Small Causes at Bombay will also have to be adjudicated upon. I am not expressing any opinion on the merits of the case except observing that the equities appear to be heavily loaded in favour of the plaintiffs. It cannot be forgotten that the defendant No. 2 got into possession of the suit flat and garage in his capacity as an employee of the plaintiffs and defendant No. 1 has already executed the transfer deeds in favour of the plaintiffs after receiving a sum of Rs. 26,000/- and odd.
17. In my judgment, a prima facie case is made out for grant of an injunction sought for. A case for exercise of inherent and equity jurisdiction is made out. If the issues arising in this suit are decided, the findings recorded in the suit will bind all the defendant. If the Court of Small Causes at Bombay tries the issues first and decides as to whether the plaintiff in that suit is the owner of the premises or not and as to whether the defendant in that suit is a tenant or not, the findings on these issues will not preclude trial of the same issues by this Court as the issues pertain to title to the suit premises. Section 29A of the Bombay Rent Act is quite clear on the subject.
18. Mr. Desai, the learned counsel for defendants Nos. 1 and 2, has submitted that the Court can grant an injunction of this kind only if this Court has jurisdiction to grant the relief which is prayed for in the eviction suit filed by defendant No. 1 against the plaintiffs in the Court of Small Causes at Bombay. I see no merit in this submission. No such restriction can be implied on power of this Court to grant an interim injunction in an appropriate case to prevent multiplicity of proceedings and in the interests of justice, equity and good conscience.
19. In view of the above discussion, I pass the following order :--
20. Notice of Motion is made absolute in terms of prayer (a). Cost of the motion shall be costs in the cause. Hearing of the suit isexpedited. Parties shall be at liberty to apply for a fixed date of hearing to the learned Judge hearing expedited suits.
21. The Prothonotary & Senior Master shall issue certified copy of this order expeditiously.
22. Order accordingly.