M/S Navyasri Minerals Vs H.S. Abdul Hafeez Sayeed

¶1

1 -

¶2

NC: 2026:KHC:7343-DB COMAP No.63/2023

¶3

HC-KAR

¶4

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9^TH DAY OF FEBRUARY, 2026

¶5

PRESENT

¶6

THE HON'BLE MRS. JUSTICE ANU SIVARAMAN

¶7

AND

¶8

THE HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL COMMERCIAL APPEAL NO.63/2023

¶9

BETWEEN:

¶10

M/S. NAVYASRI MINERALS C-2, CASA LAVELLE-4, 12/1 LAVELLE ROAD BANGALORE-560001 REP. BY ITS MANAGING PARTNER SRI. SRIDHARA BABU.

¶11

Digitally signed by ARSHIFA BAHAR KHANAM

¶12

HIGH COURT OF KARNATAKA

¶13

(BY SRI. SHIVA KUMAR K.B. ADV.,)

¶14

AND:

¶15

…APPELLANT

¶16

H.S. ABDUL HAFEEZ SAYEED S/O LATE H.S. SHEIK HABEEB PROPRIETOR M/S ORIENTAL GRANITES NO.21, ROHINI COMPLEX HASSAN-573201.

¶17

SRIDHAR BABU AGED ABOUT 70 YEARS S/O LATE P.S. RAJU M/S. NAVYASRI MINERALS C-2, CASA LAVELLA-4, 12/1 LAVELLE ROAD BANGALORE-560001.

¶18

SMT. MEERA SRIDHARA BABU AGED ABOUT 54 YEARS W/O SRIDHARABABU R/O NO.C-2, CASA LAVELLA-4

¶19

2 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶20

HC-KAR

¶21

12/1, LAVELLE ROAD BANGALORE-560001.

¶22

YASHAS SRIDHARA BABU AGED ABOUT 32 YEARS S/O SRIDHARABABU R/O NO.C-2 CASA LAVELLE-4, 12/1 LAVELLE ROAD BANGALORE-560001.

¶23

BALAKRISHNA H.G. AGED ABOUT 61 YEARS S/O LATE GOPALA SETTY R/O NO.11, IST MAIN ROAD VYALIKAVAL, BANGALORE-560003.

¶24

T.N. DEVARAJ PARTNER M/S. NAVYASRI MINERALS NO.18, SALGAME VILLAGE KASABA HOBLI, HASSAN-573219.

¶25

T.D. ARJUN PARTNER M/S. NAVYASRI MINERALS PWD COLONY, R C ROAD NEAR NCC OFFICE HASSAN-573201.

¶26

THE DIRECTOR MINES AND GEOLOGY DEPARTMENT KHANIJA BHAVAN RACE COURSE ROAD BANGALORE-560001.

¶27

…RESPONDENTS

¶28

(BY SRI. ADITYA VIKRAM BHAT, AGA FOR R8 SRI. DR. S. NAGARAJ, ADV., FOR R1 SMT. VIDYASHREE K.S. ADV., FOR R3, R4, R6 & R7 R2 & R5 SERVICE OF NOTICE IS D/W V.C.O. DTD:10.04.2023)

¶29

3 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶30

HC-KAR

¶31

THIS COMAP IS FILED UNDER SECTION 13(1)(A) OF THE COMMERCIAL COURTS ACT, 2015 R/W SECTION 96 AND ORDER 41, RULE 1 OF CPC, 1908, PRAYING TO CALL FOR RECORDS IN COMMERCIAL O.S NO.251/2020 PENDING BEFORE THE HONBLE LXXXV ADDL. CITY CIVIL SESSIONS JUDGE AT BENGALURU (CCH-86) (COMMERCIAL COURT). SET ASIDE THE ORDER DATED 01.10.2022 PASSED ON I.A NO. III FILED IN COMMERCIAL O.S NO.251/2020 BY THE HONBLE LXXXV ADDL. CITY CIVIL SESSIONS JUDGE AT BENGALURU (CCH-86) (COMMERCIAL COURT) PRODUCED AT ANNEXURE-N AND DISMISS I.A. NO.III, FILED UNDER CHANGED CIRCUMSTANCES, UNDER 39, RULE 1 AND 2 OF CPC, READ WITH SECTION 151 OF CPC, PRODUCED AT ANNEXURE-N, WITH EXEMPLARY COSTS & ETC.

¶32

THIS COMAP HAVING BEEN HEARD AND RESERVED ON 04.02.2026, COMING ON FOR PRONOUNCEMENT OF JUDGMENT, THIS DAY VIJAYKUMAR A. PATIL J., DELIVERED THE FOLLOWING:

¶33

CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN and HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL

¶34

4 -

¶35

NC: 2026:KHC:7343-DB COMAP No.63/2023

¶36

HC-KAR

¶37

CAV JUDGMENT

¶38

(PER: HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL)

¶39

This appeal is filed under Section 13(1)(A) of the Commercial Courts Act, 2015 (hereinafter referred to as 'the Act') read with Section 96 and Order XLI Rule 1 of the Code of Civil Procedure, 1908 (for short, 'CPC'), challenging the order dated 01.10.2022 passed on I.A.No.III filed by the respondent under Order XXXIX Rule 1 and 2 of the CPC in Com.O.S.No.251/2020, by the LXXXV Additional City Civil and Sessions Judge, Bengaluru (CCH-86)(Commercial Court)(hereinafter referred to as the 'Commercial Court').

¶40

The brief facts leading to filing of the appeal are that the respondent No.1 filed a commercial suit in Com.O.S.No.251/2020 for judgment and decree seeking a direction to the appellant and other respondents to reconstitute a partnership deed by inducting the respondent No.1 as a partner in the defendant No.1-partnership firm and other reliefs. The respondent No.1 also filed an

¶41

5 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶42

HC-KAR

¶43

application under Order XXXIX Rule 1 and 2 of the CPC for temporary injunction against the defendants and their agents restraining them from carrying out the quarry operations in the suit schedule property. The appellant filed a written statement denying the assertions made in the plaint. The Commercial Court, under the impugned order allowed I.A.No.III filed by the respondent No.1 by granting temporary injunction against the defendant Nos.1, 2, 6 and 7, their agents by restraining them from carrying out the quarry operations in respect of the application schedule land. Being aggrieved, the defendant No.1 in the suit filed this appeal. This Court, after hearing both the sides, vide order dated 20.04.2023 stayed the impugned order.

¶44

Sri.K.B.Shivakumar, learned counsel appearing

¶45

for the appellant submits that the Commercial Court has committed a grave error in recording the finding that the plaintiff has made out a prima facie case for grant of temporary injunction without appreciating the fact that the

¶46

6 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶47

HC-KAR

¶48

plaintiff has failed to establish any right in the suit. It is submitted that the plaintiff's prayer to induct him as a partner in the appellant-firm cannot be considered in the absence of consent of the existing partners. Hence, such a relief is not maintainable and consequently, the suit is

¶49

liable to be rejected. It is further submitted that the plaintiff claims that he has transferred Rs.15,00,000/- in favour of M/s.Sheega Exports, which does not possess a quarry lease and the quarry lease is transferred in the name of the appellant by the respondent No.5 and in view of non-joinder of M/s.Sheega Exports as a party to the proceedings, the suit is liable to be rejected and no cause of action lies against the appellant to file the suit. It is also submitted that the respondent No.1 has received the refund amount of Rs.15,00,000/from M/s.Sheega Exports which is not in dispute and there is no contractual obligation between the parties in view of the receipt of the amount without any protest. It is contended that the Commercial Court, without considering any of the aspects

¶50

7 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶51

HC-KAR

¶52

recorded an erroneous finding and granted temporary injunction which was stayed by this Court. Hence, he seeks to allow the appeal by setting aside the impugned order.

¶53

Per contra , Dr.S.Nagaraj, learned counsel for

¶54

the respondent No.1 supports the impugned order of the Commercial Court and submits that the Commercial Court clearly recorded the finding that the defendants agreed to transfer the quarry lease in favour of the plaintiff and they have received Rs.15,00,000/- as advance and the plaintiff is ready and willing to pay the balance amount. It is submitted that the Commercial Court has clearly come to the conclusion that the amount is paid by the plaintiff in part performance of the agreement which has been acknowledged by the defendant No.1 in the e-mail, draft agreement was sent and thereafter, no steps have been taken to execute the agreement and come to the conclusion that a prima facie case is made out by the plaintiff and no hardship would be caused to the defendant

¶55

8 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶56

HC-KAR

¶57

if injunction order is granted. It is further submitted that the contentions raised by the plaintiff in the plaint and the documents produced indicate that the issue raised in the plaint are triable and granted injunction which does not call for any interference. It is also submitted that if the appellant is allowed to continue the quarry activity, it would cause great prejudice and hardship to the plaintiff. It is contended that in view of the interim order granted by this Court, the appellant is doing illegal quarrying activity and in the process, the workers have died and an FIR is also registered against the appellant. It is further contended that receipt of the amount by the appellant-firm and the communication of the draft agreement amounts to implied contract between the parties, which he seeks to enforce in the suit. In support of his contentions, he relied on the following decisions:

¶58

(a) L.SIVALINGAIAH Vs. PANCHAJANYA VIDYA PEETHA WELFARE TRUST AND ORS¹

¶59

(b) H.T.VEERA REDDI Vs. KISTAMMA²

¶60

1 2007 (5) Kar LJ 625

¶61

2 MANU/TN/0664/1972

¶62

9 -

¶63

NC: 2026:KHC:7343-DB COMAP No.63/2023

¶64

HC-KAR

¶65

(c) N.MOHAMMAD Vs. THE MANDAL PANCHAYAT, KALGHATGI³

¶66

Hence, he seeks to dismiss the appeal.

¶67

We have heard the arguments of the learned

¶68

counsel for the appellant, the learned counsel for the respondent No.1 and meticulously perused the material available on record. We have given our anxious consideration to the submissions made on both the sides.

¶69

The material on record indicates that the respondent No.1 filed a suit for specific performance in Com.O.S.No.251/2020 seeking reconstitution of the partnership deed by inducting the respondent No.1 as a partner in the appellant-firm and other reliefs. The respondent No.1 also filed an application under Order XXXIX Rule 1 and 2 of the CPC for temporary injunction against the defendants and their agents restraining them from carrying out the quarry operations in the suit schedule property. The appellant filed a written statement

¶70

3 MANU/KA/0364/1998

¶71

10 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶72

HC-KAR

¶73

denying the assertions made in the plaint. The Commercial Court, under the impugned order allowed I.A.No.III filed by the respondent No.1 by granting temporary injunction against the defendant Nos.1, 2, 6 and 7, their agents by restraining them from carrying out the quarry operations in respect of the application schedule land. Being aggrieved, the defendant No.1 in the suit filed this appeal. This Court, after hearing both the sides, vide order dated 20.04.2023 stayed the impugned order.

¶74

The plaint averments indicate that the respondent No.1 paid a sum of Rs.15,00,000/- as an advance to the appellant-firm with an intention to enter into an agreement for the transfer of lease license in favour of the respondent No.1 for a total consideration of Rs.2.10 Crores. The said assertion of the plaintiff has been categorically denied by the defendant No.1-appellant in the written statement. It is specifically averred that the alleged transfer of Rs.15,00,000/- stated in the plaint was

¶75

11 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶76

HC-KAR

¶77

made to M/s.Sheega Exports. The bank statement produced by the appellant at Annexure-E also indicates that the amount was transferred to M/s.Sheega Exports and the said M/s.Sheega Exports is not a party to the suit. The document at Annexure-H1 produced by the appellant clearly indicates that the said firm has re-transferred the amount of Rs.15,00,000/- to the plaintiff's account, which he has received and acknowledged without protest. There is no material on record to indicate that the plaintiff has communicated to the appellant or M/s. Sheega Exports with regard to his intention to transfer the amount of Rs.15,00,000/- and the balance amount, as claimed to have been agreed by the parties. In absence of any such assertion, we are of the view that the plaintiff has failed to establish a prima facie right to seek for enforcement of an alleged implied contract.

¶78

The plaint averments makes it clear that though there might have been a potential interest in an agreement for transfer of lease, there was no written

¶79

12 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶80

HC-KAR

¶81

contract or agreement to the said affect that bounded the appellant-firm. In view of the above fact, we are of the considered view that in the absence of a written agreement and proper material to prove an implied contract, the plaintiff has failed to make out a prima facie

¶82

case warranting an order of temporary injunction against the appellant-firm, who is lawfully carrying out his activity as per the license issued by the competent authority. We are also of the view that the balance of convenience lies in favour of the appellant-firm as restraining them from carrying on the business activities will cause a huge financial loss to the appellant and also that non-granting of the temporary injunction will not cause irreparable loss or injury to the respondent No.1 as the loss may be compensated by monetary compensation in case the plaintiff succeeds in the suit. The contention of the respondent No.1 that there was a violation of an implied contract by the appellant-firm can be adjudicated by the Commercial Court in accordance with law. It is also

¶83

13 - NC: 2026:KHC:7343-DB COMAP No.63/2023

¶84

HC-KAR

¶85

noticed that the alleged transfer of money is to a different firm and the said firm is not a party to the suit and in the absence of any receipt of advance amount by the appellant-firm under the alleged implied contract, there cannot be any restrainment order against the appellant. The Commercial Court erroneously came to a conclusion that the plaintiff has paid Rs.15,00,000/to the defendant-firm for the transfer of quarrying license as an advance consideration out of the total consideration of Rs.2.10 Crores and placing reliance on such a document and e-mails, has proceeded to hold that a prima facie case is made out. We have already recorded the finding supra with regard to the pleading and document relied on by the plaintiff with regard to the payment and the alleged implied contract by holding prima facie that the alleged transaction between the parties is only an intention to enter into a contract for the transfer of quarry license. However, the said intent does not appear to have culminated into an enforceable contract.

¶86

14 -

¶87

NC: 2026:KHC:7343-DB COMAP No.63/2023

¶88

HC-KAR

¶89

Insofar as the judgments relied on by the

¶90

learned counsel for respondent No.1 is concerned, it lays down the settled principles of law governing the temporary injunction, which is not disputed. However, the said judgments will not come to his aid while applying the principles to the facts of this case, wherein the prima facie case is not established by the respondent No.1.

¶91

It is made clear that the finding recorded by this Court is limited to the extent of adjudication of an application filed by the plaintiff under Order XXXIX Rule 1 and 2 of the CPC and the Commercial Court shall not be influenced by the finding recorded by this Court. The Commercial Court shall dispose of the suit on its merits and in accordance with law as expeditiously as possible.

¶92