IN THE HIGH COURT OF GUJARAT AT AHMEDABAD APPEAL FROM ORDER No 334 of 1992 For Approval and Signature: Hon'ble MR.JUSTICE P.B.MAJMUDAR ============================================================ 1. Whether Reporters of Local Papers may be allowed : NO to see the judgements? 2. To be referred to the Reporter or not? : NO 3. Whether Their Lordships wish to see the fair copy : NO of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? : NO -------------------------------------------------------------- UNITED WESTERN BANK LTD Versus V X L LTD -------------------------------------------------------------- Appearance: MR YOGESH S LAKHANI for Petitioner MR KS NANAVATI for Respondent No. 1 MR HD RANA for Respondent No. 2, 4 MR DARASHAN M PARIKH for Respondent No. 3 -------------------------------------------------------------- CORAM : MR.JUSTICE P.B.MAJMUDAR Date of decision: 19/10/2000 ORAL JUDGEMENT Respondent no.1 - VXL India has filed a suit being Special Civil Suit No.24 of 1992 in the Court of Civil Judge (S.D.), Porbandar against the respondents 2 to 4 herein, praying for recovery of L.C. amount which is valued by the plaintiff at Rs.2.46 crores. In the aforesaid suit, application for interim injunction was given before the trial court under the provisions of Order 39 Rules 1 and 2 of CPC, inter alia, praying that the defendants, i.e. respondents 2 to 4 herein, be restrained from implementing, executing and enforcing L.C. No.ILC/351/91 dated 26.12.1991 for Rs.100/- lacs and L.C. No.ILC/352/91 for Rs.100 lacs till the final disposal of the suit. The learned trial Judge granted ex parte injunction as prayed for. The aforesaid ex parte injunction is challenged by the present appellant, who is third party to the suit as, according to the appellant, even though the appellant was a necessary party, he was not joined in the suit and that they are greatly and vitally affected by the ad interim injunction granted by the trial court. This Court, while admitting the Appeal from Order, passed an interim order on 17th July, 1992. This Court, prima facie, found at the time of admitting the appeal that the trial court was not justified in granting an ad interim injunction and accordingly vacated the said injunction while passing order in C.A.No.2751 of 1992. However, appropriate conditions were imposed by this Court. This Court accordingly passed following interim order in the present Appeal from Order at the time of considering Civil Application :- "... (a) Hearing of Exh.5 in Suit No.24/92 pending before the Ld. Civil Judge (SD) Porbandar is expedited. The appellant shall apply for being impleaded as party and court shall grant such application as and when made. Appellant shall file its reply and defendant No.2 represented by Ld. AG also undertakes to file its reply within 10 days from today. Appellant shall also file its reply within ten days from today. The trial court is directed to her the parties day to day after the replies are filed and to finally decide the application Exh.5 on or before 24.8.92 and it is also directed to report compliance of order of this court to this court. (B) The ex parte order of injunction passed by the Civil Judge (SD) Porbandar, dated 6th July, 1992 is vacated. The defendant No.3-Oman International Bank is directed to encash the letters of credit in favour of appellant, subject to condition that the amount of letters of Credit Nos 351/91 and 352/91 received by the appellant bank shall be kept by the appellant bank in separate suspense account to be opened for these two letters of credit under the order of this court and such account shall not be operated nor would said amount lying in the said account be dealt with by the appellant till the order is passed by the trial court. (c) The appellant bank shall file undertaking in this court by 21st July, 1992 to the effect that it shall open a separate suspense account for the aforesaid two letters of credit and shall keep the amount received from Oman International Bank in said account separately and that it shall not deal with said amount lying in the account till the trial court decides Exh. 5 finally .... " 2 The aforesaid order was challenged by the original plaintiff before the Apex Court, as stated by Mr Lakhani and Mr Nanavati but the Apex Court had dismissed the said S.L.P. However, the aforesaid interim order of this Court was further modified by this Court in Civil Application No.853 of 1993 and this Court also permitted the appellant herein i.e. United Western Bank Limited to adjust and appropriate amount of Rs.2 crores against their bills. However, the aforesaid permission was granted subject to the following conditions:- "1. The applicant-bank shall file an undertaking in this Court that in the event of losing in the hearing of Exh.5 application, it shall deposit in this Court amount of Rs.2 crores within a week from the date of the order of the trial Court. Such undertaking shall be filed in this Court within a week from today. 2. The Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio (CLR) shall be maintained by the applicants with the Reserve Bank of India and the Reserve Bank of India shall see to it that the aforesaid ratios of the United Western Bank Limited (Appliant) is maintained, so that minumum amount of Rs.2 crores is maintained in its account by the applicant bank with the Reserve Bank of India, Bombay. Intimation of this condition shall be sent to the Reserve Bank of India, Bombay and applicant shall also send copy of this order to the Reserve Bank of India, Bombay. ..." 3 Today the matter has now reached final hearing. I have heard Mr Lakhani for the appellant, Mr P.A.Mehta for respondent no.1 - original plaintiff and Ms Darshana Divakaran for Mr Darashan Parikh for respondent no.3. It is not disputed by the leanred advocates that the subsequent interim order passed by late Justice S.D. Shah is still in force. It is further stated that Exh.5 is yet not decided and under instructions it has been submitted by Mr P.A.Mehta for Nanavati Associates that the trial Court had passed an order that Exh.5 should be decided along with main suit. If Exh.5 application is not decided yet, now it will not be proper to direct the Civil Court to decide the same because the suit is of 1992 and modified order passed by this Court remained in force all these years. Today therefore with the consent of the learned advocates who are present in the Court the following order is required to be passed:- (i) The appellant-bank herein shall file an undertaking in this Court as well as the trial Court within four weeks from today to the effect that in the event of their losing in the main suit, it shll redeposit in the trial Court an amount of Rs.2 crores with interest within a week from the day of the order of the trial Court. The aforesaid direction of redepositing of the amount is required to be given because the same was allowed to be taken away by the appellant by virtue of the interim order passed by this Court. (ii) The Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio (CLR) shall be maintained by the appellant-bank with the Reserve Bank of India and the Reserve Bank of India shall see to it that the aforesaid ratios of the United Western Bank Limited (Appellant) is maintained, so that minumum amount of Rs.2 crores is maintained in its account by the applicant bank with the Reserve Bank of India, Bombay. Intimation of this condition shall be sent to the Reserve Bank of India, Bombay and applicant shall also send copy of this order to the Reserve Bank of India, Bombay. (iii) The Civil Judge (S.D.) Porbandar is directed to decide and dispose of Special Civil Suit No.24 of 1992 on or before 31.08.2001" 4 It is needless to say that so far as direction about redepositing the amount by the appellant in case of losing the suit is concerned, it will be subject to their right of filing an appeal i.e. even though the amount may be deposited initially, it will still be open for the bank to initiate appropriate proceedings in accordance with law, if the order of the trial court is against them. 5 The aforesaid order is passed with the consent of all concerned advocates who are present in the Court today. Since the modified interim order passed by this Court remained in force all these years, it is just and proper to continue the same till the suit is finally disposed of by the Civil Court. This Appeal from Order is partly allowed with no order as to costs. The trial Court will hear and decide Special Civil Suit NO.24 of 1992 as directed above. Writ of this Court should be sent to the trial Court forthwith. *** (mohd)