“This article highlights the Bombay High Court’s reaffirmation of limited appellate review for temporary injunctions. For litigants, this means a clearer understanding of the narrow grounds for appeal, fostering more strategic and efficient approaches to dispute resolution involving interim reliefs.”
A Full Bench of the Bombay High Court, in UTO Nederland B. V. Ltd. v. Tilaknagar Industries Ltd,[1] has resolved a conflict between previous Division Bench decisions concerning the scope of appellate review of orders on temporary injunction. The Court held that such orders are discretionary and not merely prima facie adjudications, thereby reaffirming that appellate interference in such cases would be limited to principle as enunciated by the Supreme Court in Wander Limited. v. Antox India P. Ltd.,[2] viz. instances where discretion is exercised arbitrarily, capriciously, perversely, or in disregard of settled legal principles.
Factual background
The dispute between the parties pertained to infringement of copyright and passing off, and assertion of proprietorship over certain trademarks. An appeal from the Single Judge’s order refusing a temporary injunction prompted the reference to the Full Bench.
The Appellate Bench noted that conflicting lines of authorities from the Court made it imperative to constitute a Full Bench to ascertain (i) whether an order on a temporary injunction application constitutes a prima facie adjudication or a discretionary exercise; and, consequently, (ii) the scope of an appeal from such an order by a trial court on an injunction application.
Conflicting views of various Division Benches of the Bombay High Court
A ruling on the grant of temporary injunction is a discretionary order
Various rulings of the Bombay High Court, resting with its decision in Colgate Palmolive Company and Another v. Anchor Health and Beauty Care Pvt. Ltd.,[3] have held that the grant of a temporary injunction is a discretionary relief and that the Court does not adjudicate on the merits. The Court merely considers such an application through the prism of the trinity test – (i) prima facie case; (ii) balance of convenience; and (iii) irreparable injury – and consequentially exercises discretion without expressing an opinion on the merits.
A ruling on the grant of temporary injunction is a prima facie adjudication of the rights of the parties
The Division Bench rulings of the Court in Parksons Cartamundi (P) Ltd. v. Suresh Kumar Jasraj Burad[4] and Goldmines Telefilms Pvt. Ltd. v. Reliance Big Entertainment Pvt. Ltd. & Ors.[5] held that an order passed on an application for temporary injunction is predicated on prima facie adjudication and not merely an exercise of discretion. Consequently, the scope of an appeal from such an order is wide and necessarily involves the reappreciation of evidence by the appellate court, rather than just a test on whether discretion was exercised arbitrarily, capriciously, perversely, or in disregard of settled legal principles as set out in Wander.
The Full Bench was, therefore, tasked with reconciling the conflicting views taken by the Division Benches of the Court.
Full Bench’s answer to the reference
The Full Bench approved the position taken in Colgate Palmolive (supra).It noted that Parkson Cartamundi and Goldmines Telefilms relied on a previous ruling of the Court in Hiralal Parbhudas v. Ganesh Trading Company.[6]However, Colgate Palmolive considered and distinguished Hirala Prabhudas on the basis that Hiralal Prabhudas pertained to proceedings under Section 56(1) of the Trade and Merchandise Marks Act, 1958, and was inapplicable to proceedings under Order 39 of the Code of Civil Procedure, 1908. Further, neither Parkson Cartamundi nor Goldmines Telefilms considered the decision in Colgate Palmolive, and were therefore rendered per incuriam.
The Full Bench held that the trial court’s mere consideration of a prima facie case – as required under the trinity test – does not imply an adjudication of the merits of the case. Therefore, any order of the trial court in this regard is discretionary in nature, and the grounds to challenge are limited to those laid down in Wander.
Conclusion
The Court has resolved a conflict of judgements regarding the scope of appeal from orders permitting or rejecting temporary injunctions and has done away with an avenue to expand the scope of such appellate proceedings beyond the principles set out in Wander. In light of the Full Bench’s ruling, parties seeking or defending temporary injunctions should be aware that an appellate challenge remains circumscribed by the test laid down in Wander. This reaffirms the discretionary nature of temporary injunction orders, limiting the scope for appellate scrutiny to cases of demonstrated perversity or misapplication of legal principles.
Given the glacial pace of judicial proceedings in India, it is critical that a case for interim reliefs be moulded carefully to obtain a favourable outcome. In our experience, a favourable order on interim reliefs significantly improves a party’s chances of achieving a successful resolution. Such orders not only expedite settlement of disputes but also help save on litigation costs for the parties.
[1] Appeal No. 66 of 2012
[2] 1990 (Supp) SCC 727
[3] (2005) 1 Mah LJ 613
[4] (2012) 5 AIR Bom R 148
[5] (2014) 6 AIR Bom R 245
[6] AIR 1984 Bom 218