Percept D'Markr (India) Pvt. Ltd vs Zaheer Khan & Anr

Respondent No.1, by his letter dated 18.11.2003, alleged that he had no obligation under the said agreement after 29.10.2003, save and except honouring the subsisting agreement entered into by respondent No.1 with third parties as specified in his letter dated 10.09.2003 and the agreement entered into with Adidas Limited which was negotiated prior to the expiry of the said agreement. In the said letter for the first time, after the said agreement had expired by efflux of time, respondent No.1 alleged that the said agreement was allegedly one-sided and an unfair arrangement. It is pertinent to note that during the entire period of the said agreement, respondent No.1 had not alleged to the appellant that the terms of the said agreement was either one- sided or unfair. The appellant states that the same was clearly an after-thought.

The appellant, for the first time, became aware on 01.12.2003 from some sources and from the website of respondent No.2 that respondent No.1 has entered into an agreement with respondent No.2 for services similar to the services rendered by the appellant under the said agreement. Respondent No.1 has not denied the fact that he negotiated with third parties, including respondent No.2 prior to expiry of the agreement without discharging his obligation to intimate the appellant of such offer.

The Division Bench allowed the appeals and dismissed the arbitration petition filed by the appellant on 19.12.2003. The High Court, by the said order, directed respondent No.1 (i) to place before the High Court in a sealed cover the copy of the agreement entered into by respondent No.1 with respondent No.2 and/or any other third party immediately and was further directed to place upto date accounts under the said contract/s (ii) to place before the High Court any other contract that he may enter into with any third party within a period of 4 weeks from 19.12.2003; and (iii) to place on record the account/s of four weeks under such contracts in a sealed cover.

According to Mr. Desai, the facts in this case clearly disclose the nature of the Promotion Agreement entered into between the parties and the benefit obtained by respondent No.1 as well as the appellant. The Promotion Agreement dated 01.11.2000 is a class of contracts, common in the industry, that may be termed as 'celebrity contracts'. While arguing the case, Mr. Desai highlighted certain provisions of the agreement which are as follows:-

Mr. Desai also furnished a brief list of dates which, according to him, will restrict the contract of respondent No.1 in attempting not to honour his obligation under the agreement to provide the appellant with a right to match any third party offer.

It is pertinent to notice that ever since the rejection of the said interlocutory application on 19.12.2003, there has been no injunction in operation and this Court while granting leave to appeal also declined to grant any stay of the Division Bench's order or restoration of the Single Judge's order. Consequently, during the past 2= years, the contract dated 22.11.2003 between respondent No.1 and respondent No.2 has been in operation and, indeed, is soon to be completed. The appellant is now seeking a mandatory interim order 2= years down the line, praying in effect that this Court should set the clock back and grant an interim injunction which was rejected by the High Court on 19.12.2003 and which was declined at the stage of granting leave to appeal by this Court.

Learned senior counsel for respondent No.1, Mr. Chanderuday Singh, per contra, submitted that since the present appeal challenges an interim order, and no interim relief having been granted in favour of the appellant during the past 2= years, during which the contract between respondent No.1 and respondent No.2 has been in operation and indeed is soon to be completed, there is no cause for interference at this late stage by this Court. In the light of the intervening events, sufficient protection for the appellant will be given if this Court were to clarify (i) that all observations and findings of the High Court were for the limited purpose of deciding an interlocutory application, and hence will not bind parties at trial; (ii) that all contentions raised by all parties are expressly kept open; and (iii) that the interim protection in paragraph 17 of the High Court's order will continue till the conclusion of the contract dated 20.11.2003.

The appellant can be adequately compensated in terms of money if injunction is refused. In our view, grant of injunction, in the present case, would result in irreparable injury and great injustice to first respondent which is incapable of being remedied in monetary terms, as he would be compelled to enter into a relationship involving mutual, faith, confidence and continued trust against his will.

Clause 31 (a) and (b) is reproduced below:-

Clause 32(g) of is reproduced below:

In the result, the appeal stands dismissed on the above terms. No costs. 27578