PRADIP LAMP WORKS Vs. PRATAP CHANDRA BASU

JUDGEMENT

(1.) This is an appeal against an Order of the Seventh Court of the Subordinate Judge at Alipore made on July 28, 1964 restraining [he respondent by an injunction from proceeding with a Suit for specific performance of a contract instituted in a Court at Delhi. Briefly, the facts are that on February 16, 1959 the Board of Directors of the India Electric Works Limited passed a resolution agreeing to sell a piece of land in Delhi to a partnership firm called Pradip Lamp Works. Some of the Directors of the Limited Company were the partners of the firm. On February 17, 1959, the limited Company informed the firm in writing that the resolution aforesaid had been passed. On November 17, 1960, the Central Government in the exercise of its powers under the Industries (Development & Regulation) Act, 1951 ap-pointed an authorised Controller of the India Electric Works Limited. We shall set out the relevant provisions of this Act at a subsequent stage. Let us now proceed with the bare facts. On February 1, 1903, Pradip Lamp Works filed a Suit in the Court of the Subordinate Judge of Delhi for specific performance of an agreement between India Electric Works Limited and Pradip Lamp Works in respect of the land in Delhi. We incidentally mention that it has been urged before us that there was no concluded agreement between the parties but we do not purpose to express any opinion on this contention in this appeal. On the same day namely February 1, 1972, Pradip Lamp Works made an application to the Delhi Court for an interim injunction restraining the limited company from dealing with or disposing of the Suit Land during the pendency of the Suit. The Delhi Court passed an order of interim injunction. The Written Statement in the Delhi Suit was filed on April 6, 1962. The Delhi Court made this order of injunction absolute on May 7, 1962. On April 30, the issues were settled. On June 5, 1962 an additional issue being Issue No. 1-A was framed.

(2.) In May, 1963 the India Electrict Works Limited filed a petition for amendment of the Written Statement. The amendments were allowed and the amended Written Statement was filed on May 20, 1963.

(3.) On June 25, 1963 the authorised Controller filed a petition under Section 18-C of the Industries (Development and Regulation) Act, 1951 in the Court of the Subordinate Judge at Alipore. Section 18-C runs thus: "Without prejudice to the provisions contained in Section 18-B, the person or body of persons authorised under Section 18-A to take over the management of an industrial undertaking may, with the previous approval of the Central Government, make an application to any Court having jurisdiction in this behalf for the purpose of cancelling or varying any contract or agreement entered into, at any time before the issue of the notified order under Section 18-A, between the industrial undertaking and any other person and the Court may, if satisfied after due inquiry that such contract or agreement had been entered in bad faith and is detrimental to the interests of the industrial undertaking make an order cancelling or varying (either unconditionally or subject to such conditions as it may think fit to impose) that contract or agreement, and the contract or agreement shall have effect accordingly."