Civil Law

Electronic evidence issues including certificate 65B, proof of email, sms, facebook, whatsapp, call details, bank statements in Court.

  • Issues
  • How to prove an email in a court case ?;
  • What is the manner in which a voice/video recording is to be led before the court and proved in evidence ?;
  • How to prove electronically maintained Bank Statements ?;
  • How to prove a Facebook, Twitter post, a WhatsApp message or an SMS ?;
  • The proof of Call Detail Records in a court case ?

These are some questions that the courts are faced today, almost on an everyday basis. The use of computers is all-pervasive now. Almost all data is digital these days and most communication is exchanged electronically through SMS,Email, Whatsapp, Facebook, Twitter etc.   In Civil as well as Criminal Cases, the courts are frequently called upon to rule on whether ‘electronic evidence is admissible or not’. Practice has shown that this is by no means an easy question to answer.

This write-up is an attempt to simplify the complex law relating to admissibility of electronic evidence and to touch briefly upon some of the most pressing issues, as discussed above.

  1. The First principles of law

First, a few words about how the law embraced the IT revolution. The IT Act, 2000 has given sanctity to electronic records and the definition of ‘evidence’ in the Evidence Act, has been expanded to include electronic records. Data in electronic form has to be stored and preserved. An electronic record, simply put, is information/data recorded in an electronic form. Therefore, data recorded on a hard drive, pen drive, CD, DVD, or even the Internet qualifies as ‘electronic record’.  An image file on your pen drive, or a photo clicked on your phone or a WhatsApp message on your phone memory or service provider’s server are all ‘electronic records’.

The original device in such a case which produced the electronic record is ‘primary evidence’. For eg : The sound recorder/CCTV Camera and attached hard disk used to record a video/audio clip are primary evidence of its contents. Another example may be huge servers where data is created and stored. Such servers are what qualifies as ‘primary evidence’. The general rule of law of evidence is that when primary evidence is available, secondary evidence is not admissible. However, the same principle cannot be strictly applied in cases of electronic records. Large Servers/Original devices cannot be expected to be brought before the court in each case. Therefore, secondary evidence in the form of a output such as Printout or soft copy in the form of CD/DVD etc is admissible in a court of law, provided certain conditions are met.

These conditions are laid down with a view to ensure that the secondary evidence is true and accurate representation of the original electronic record and has not been tampered with, in any manner.

  1. What is Section 65B of the Evidence Act ?

Section 65-B of Indian Evidence Act, simply put, lays down the conditions and procedure of proof of an electronic record in a court of law. Section 65B is important insofar as it recognises that the original primary evidence of electronic record cannot be expected to be brought before the court and even if it is, the same being in binary form (Binary is the language that the computer/machine understands – where everything is stored in a string of zeros and ones!) the same cannot be understood by the court.  The net effect of Section 65B is that the output in the form of a printout or data copied on CD/DVD etc produced by the computer is rendered admissible in the court, provided certain conditions are met. This is the import of Section 65B(1).

 

Section 65B(2)  lays down certain conditions relating to integrity of the data. These conditions are there to ensure that :

a) there has been no unauthorised access to the data in question;

b) the computer was functioning properly and therefore the reproduction of data is accurate and genuine.

3. Certificate u/s 65B of the Evidence Act : Who is to issue, and what is that it is supposed to contain ?

The output of a electronic record, in order to be admissible in a court of law, has to be filed along with a certificate u/s 65B(4) of the Evidence Act. Such a certificate has to be issued by a person occupying responsible position with respect to the computer from which the data is produced. The certificate has to certify the conditions laid down in S. 65B(2) relating to integrity of data and computer system; the manner of production of the output of electronic record, identity and particulars of device used (including the original device).  The entire idea behind the certificate is to ensure, once again, integrity of source, authenticity of data, so that the court can place reliance on it. This is important since electronic data is more prone to tampering and alteration.

Questions such as : How the certificate is to be prepared, who is to issue the certificate, and the exact contents of the certificate, will depend on the specific nature of electronic record that is sought to be proved. For instance : A image taken with the mobile phone camera, will be first copied onto the laptop and thereafter printed out. In such a case, the certificate will have to mention the process of transfer and printing so as to prove ‘integrity in the chain of movement’ and will have to be prepared and given by the operator of the mobile phone and the laptop. It has to compulsorily conform to the conditions in S.65B(2) & (4). It has to identify the original mobile phone and the other devices used in preparing the output. In such cases, preserving the original is also extremely necessary. Computer Forensic Experts advise the retention/preservation of the original in a dust/transmission resistant environment, making a clone copy of the contents therein (after using devices such as write-blocker to ensure no data is written onto the device during access and process of copying), and access to the document through the clone/mirror copy only.  Accessing the data on the device itself may make the authenticity/integrity of the document suspect and may make it open to challenge. Taking the ‘Hash Value’ of the device at the time of seizure (Simply put, a Hash Value is a specific string of numbers that each file produces; any change in the file, even a space or a comma, leads to a total change of hash value; this algorithm is used to preserve the document in original shape and ensure no tampering takes place). Taking the hash value at the time of seizure of electronic evidence and thereafter, at the time of evidence before the court convinces the court as to non-tampering with the device. (The different forensic practices used to guarantee evidentiary value, in greater details, will be discussed in a different post of ours).

Things get slightly more complicated when information over the internet is sought to be proved. One view is that the person taking the printout from a website/email – is to give the certificate; the other view is that the person incharge and responsible for the server where the information resides is to give the certificate. The latter option spells great trouble and will render most electronic information extremely difficult to be proved as most servers are located in distant locations, spread over a large geographical area ,under managerial control of different personnel, and most importantly outside the jurisdiction of our courts.

The question on as to who is to issue the certificate is also important, and assumes even greater importance in case of proof of Call Detail Records etc.

By virtue of decision of Delhi High Court in Kundan Singh Vs. The State [MANU/DE/3674/2015], the doctrine of hearsay, in its application to proof of electronic evidence, has been limited a great deal. The court has recognised the fact that in cases of huge information contained across various servers, which is sought to be proved years later, it may not be possible to procure the  evidence/certificate issued by persons incharge of the computer system at that time. In such cases, people who have subsequently taken over charge of such computers can issue certificate u/s 65B Indian Evidence Act.  Evidence in such cases cannot be eschewed merely on the ground of hearsay.  Therefore, what follows is that a person holding a responsible official position in relation to the operation of the relevant device/activities can give a certificate u/s 65B in relation to CCTV Records/CDR Etc.  This flows from the fact that the fact that system was working properly at a relevant time is something that can be gauged from system logs, and is not something that is strictly within personal knowledge of one individual.

Another peculiar situation that may be visualised is when the output of an electronic record is seized from the Accused; for eg, at the time of arrest, the accused is made to take a printout from his email  account; whether in such a case it is the accused who can be made to issue the certificate; and if yes, whether the same amounts to ‘self incrimination’ and resultantly, runs foul of Article 20(3) of the Constitution. Conversely, can one also say that this printout is a ‘fact discovered’ for the purpose of Section 27 of the Evidence Act, and therefore, admissible in evidence even de hors Section 65B of the Evidence Act. The jury is out on this one, and a authoritative decision of the court is awaited. Till then, there are arguments for and against each position.

  1. Is the certificate u/s 65B(4) of Evidence Act mandatory for reception of electronic evidence ? 

In this regard, the earlier view_ was that compliance with S.65B of the Evidence Act is not an absolute requirement of law and Secondary evidence, in terms of Section 65 IEA can still be led in proof of a electronic record. However, the Supreme Court in ANVAR P.V. VS. P.K. BASHEER AND OTHERS [MANU/SC/0834/2014] has ruled that a certificate u/s 65B is compulsory for admission of electronic evidence and over ruled Navjot Sandhu(supra) to that extent. The Court observed that Section 65B of the Evidence Act begins with a ‘non-obstante clause’ and would override the general law on secondary evidence, as laid down under Section 63 and 65 of the Evidence Act. Section 65B is a special provision concerning proof of electronic records. The very caption of S.65A read with S. 59 and 65B is sufficient to hold that the special provisions on evidence relating to electronic record shall be governed by the procedure prescribed u/s 65B of the IEA, 1872. This is a complete code in itself and being a special law, the general law under sections 63 and 65 has to yield. (Generalia specialibus non derogant :  special law will always prevail over the general law.) Therefore, Section 63 and Section 65 of the Evidence Act have no application to the secondary evidence of the electronic evidence and same shall be wholly governed by the Section 65A and 65B of the Evidence Act. No expert evidence/oral evidence can be led in absence of the certificate.  The case concerned proof of video footage relating to an election malpractice matter. The court held that the output in the form of CD/DVD/Pen drive was inadmissible in absence of the certificate; however, if the original recorder/hard drive attached to CCTV is led in evidence, the same can be received even without the certificate as it will be primary evidence itself.   Also see : Kishan Tripathi Vs. The State (MANU/DE/0434/2016), where it was held that Original Hard Disk containing CCTV Footage is a primary evidence u/s 62 EA.

This position has been reaffirmed by the Hon’ble Supreme Court recently in Harpal Singh @ Chhota Vs. State Of Punjab (CRIMINAL APPEAL NO. 2539 OF 2014) Date of Decision : 21.11.2016.

In cases relating to voice/video recording : the absence of tampering, identity of voice (confirmed through ‘voice samples’ taken before the magistrate and subsequent examination through Forensic Labs) is extremely crucial.

Another contentious question in this regard that came up in a series of cases was : whether a witness who is seeking to prove an electronic record can be allowed to depose in the court in his examination in chief as to the conditions of S.65B as sufficient compliance. The answer to this question has to be ‘No’. When the statute demands something to be done in a specific manner, it has to be done in that manner alone and the procedure cannot be circumvented.  Therefore, the requirement of certificate u/s 65B cannot be satisfied by a witness deposing as to these conditions, in the examination in chief. This is the import in the decision of Jagdeo Singh and Ors. Vs. The State (MANU/DE/0376/2015)

 

  1. Proof of SMS 

 In case of proof of SMS, the original handset can be led in evidence as primary evidence. In case of extracted copy of SMS, certificate u/s 65B of the IEA becomes essential. In both these cases, it is of extreme significance to first of all – clone the mobile phone device, take a backup and operate on the backup copy only. Any alteration of data on the mobile phone will seriously undermine the evidentiary value of the SMS.

 

  1. Proof of Email

If the email rests on a web based email facility like gmail/yahoo etc – A printout of the email (alongwith meta data/header information (required u/s 7 of the IT Act) has to be accompanied with a certificate u/s 65B of the Evidence Act, given by the person operating the account and taking the printout.  Section 88A of the Evidence Act also provides for certain presumptions with respect to receipt of emails, which may be useful in proof of email correspondences.

In case of server based emails, the certificate ought to come from the incharge of the computer servers.

In all these cases, the preservation of what is called ‘meta-data’ is extremely crucial. Simply put, meta data is data about data and contains information relating to date/time/origin/authenticity/access date of the data, which goes on to strengthen, or destroy its evidentiary or believability quotient. (More on this on our piece of digital forensics!)

There might be one more provision that may become important insofar as emails are concerned :-

Section 88A – Presumption as to Electronic Messages. It reads :

The Court may presume that an electronic message, forwarded by the originator through an electronic mail server to the addressee to whom the message purports to be addressed corresponds with the message as fed into his computer for transmission; but the Court shall not make any presumption as to the person by whom such message was sent.” .

Simply put, the presumption in this section is to the effect that data sent by email from X computer corresponds to data received at Y computer. The court may not draw the presumption, or the same may be rebutted, being a rebuttable presumption of fact. Besides this, there is no presumption as to the identity of the sender as the section makes clear.

In addition to this, under section 65B it has to be proved that the computer during the relevant period was in the lawful control of the person proving the email [Babu Ram Aggarwal & Anr. Vs. Krishan Kumar Bhatnagar & Ors. 2013 IIAD (Delhi) 441].

In Abdul Rahaman Kunji Vs. The State of West Bengal [MANU/WB/0828/2014] the Hon’ble High Court of Calcutta while deciding the admissibility of email held that an email downloaded and printed from the email account of the person can be proved by virtue of Section 65B r/w Section 88A of Evidence Act. The testimony of the witness to carry out such procedure to download and print the same is sufficient to prove the electronic communication.

  1. Proof of Bank Statements, whether compliance of S.65B essential ?
  • This is governed by a special law. As per the Bankers Book Evidence Act, (Sec 2A of BBEA), the following three certificates are required to prove a bank statement :-
    • A certificate regarding authenticity of entry/printout by the principal accountant or branch manager.
    • Authenticity certificate from person in-charge of computer system regarding:-
  • Details of Computer System
  • Process of Data Storage
  • Safeguard to protect Computer System and Data
  • the fact that such computer system operated properly at the material time, he was provided with all the relevant data and the printout in question.

 

  1. Whether a certificate u/s 65B conclusively proves the facts contained in the electronic record and amounts to truth ? 

The answer has to be a resounding ‘No’. S.65B deals with conditions precedent for admission of the electronic evidence. Compliance of S.65B Evidence Act allows the court to read the document. The court still has to examine relevancy, genuineness, veracity and reliability of the document. The probative worth, that is to say, whether the document has an actual bearing on the case or not or how much weight is to be attached to it, is also to be examined independently.

  1. Whether a Certificate u/s 65B of the Evidence Act has to be mandatorily filed along with the printout/CD, or can the same be filed subsequently as well? 

The earlier view was that the certificate had to be filed alongside the print of electronic record, and not thereafter. However, after the Delhi High Court Judgment in Kundan Singh Vs. The State [MANU/DE/3674/2015], the position in law has been clarified : A certificate u/s 65B can be filed even thereafter, and need not be filed alongside. The witness who had tendered the electronic record in evidence can be recalled u/s 311 of the CrPC for the purpose of producing the certificate. The underlying basis of this view is that initial lapse on the part of the party should not detain the court from having the required evidence before it, which will assist the court in discovery of the truth. The court shall seek all evidence before it which is essential for a just decision of the case. All endeavour is to be made to decide the case on merits, rather than exclude what may be important evidence on technical considerations.

What follows is that the certificate can be filed even after filing of chargesheet, and can form part of a supplementary chargesheet u/s 173(8) of the CrPC.

Even the Rajasthan High Court in Paras Jain and Ors. Vs. State of Rajasthan, [MANU/RH/1150/2015] has held that : non filing of certificate u/s 65B Evidence Act is not an incurable  irregularity and can be rectified later on.

  1. Whether an objection as to non compliance of S.65B of the Evidence Act can be waived or conceded ?
  • Though there is no direct decision on this point, but if the opposite party admits a printout/CD/DVD etc and does not dispute it, in such a situation, admission acts as waiver of proof and compliance of S.65B IEA to prove the same is not required. An objection as to mode of proof can be waived if not taken at the appropriate stage. Shamsher Singh Verma Vs. State of Haryana [MANU/SC/1345/2015]
  • Conclusion

Law relating to proof of electronic evidence is in a state of huge flux in view of rapid technological advancements. The law is struggling to keep pace with them. Some questions relating to time of filing of certificate have been answered, while some relating to the authorship of the certificate are still to be worked on and authoritative precedent on these points is required.

*The Author is a Delhi based lawyer and has advised and fought many electronic evidence/cyber crime issues, across India and can be reached at bharat.law06@gmail.com 

Civil Law · Criminal Justice System · Uncategorized

Issues relating to Electronic Evidence – Admissibility, Section 65B certificate and other frequently asked questions.

Issues relating to Electronic Evidence

  1. What is an Electronic Record ?
  2. Types of Electronic Records.
  3. Is an Electronic Record a ‘document’ ?
  4. Is a ’Hard Drive’ a document ?
    • Admissibility of Hard Disk
  5. Proof of Electronic Record.
  6. Section 65B of the Evidence Act
  7. Effect of use of Non Obstante Clause in S.65B(1);
  8. Conditions : Section 65B(2) (a) & (c) related to computer’s integrity;
  9. What if Computer Malfunctions ?
  10. Conditions in Section 65B(2) (b) & (d) relating to the informational ‘chain of integrity’;
  11. Section 65B(4) Certificate
  12. Whether Mandatory ?
  13. Oral Testimony as to S.65B – whether sufficient compliance of Section 65B(4) ?
  14. Who is to file the certificate ?
  15. Stage of filing – Can the certificate u/s 65B(4) be received at a later stage, that is to say, after filing of the electronic evidence on record in the form of an output ?
  16. Whether judicial admission by the opposite party as to the electronic record dispenses with formal proof and compliance of Section 65B of the IEA ?
  17. E-Contract – territorial jurisdiction;
  18. Challenging issues in interface with Criminal Law.

 

  1. What is an Electronic Record ?

2(t) of the IT Act “Electronic Record” means Data, Record or Data Generated, Image or Sound Stored, Received or Sent in an Electronic Form or Micro Film or Computer Generated Micro fiche;

 

  1. Types of Electronic Record.

Pen Drive, CD, DVD, Whatsapp message, email, SMS, Video, image file etc.

 

  1. Electronic Records as ‘documents’ for the purpose of Evidence Act.

Section 3 of Indian Evidence Act.

“Evidence” – ‘Evidence’ means and includes—

(1) all statements which the Court permits or requires to be made before it by witnesses, in relation to matters of fact under inquiry;

Such statements are called oral evidence

(2) all documents including electronic records produced for the inspection of the Court;

such documents are called documentary evidence.

 

  1. Whether a ‘Hard Disk’ is a document ?

Answer is Yes.

Dharmabir Vs. CBI  (2008) DHC  –

  • New Hard Disk (blank slate) is merely a storage device.
  • Hard Disk once data/information is written on it, becomes a electronic record. (S.2(t) of the IT Act)
  • From Electronic Record to document (S.3 IEA)
  • Two Levels of Electronic Record : Active memory & Subcutaneous memory;
  • Accused entitled to both.
  • Right of the accused under sections 207 (v) and 173(5)(a) of the Cr.P.C.

 

  1. Proof of Electronic Record : Primary – Secondary
  2. Primary Evidence – (eg : Original Device/Electronic Record)  directly admissible u/s 62 of the IEA. (Kishan Tripathi Vs. The State, Delhi High Court 2016 held : Original Hard Disk containing CCTV Footage = primary evidence u/s 62 IEA
  3. Secondary Evidence (Output) Admissible u/s 65B of the IEA.

 

  1. CONDITIONS AS TO ADMISSIBILITY OF ELECTRONIC EVIDENCE IN COURT

 

Section 65B(1)

Notwithstanding anything contained in this Act, any information contained in an electronic record

  • which is printed on a paper;
  • stored, recorded or copied in optical or magnetic media produced by a computer
  • shall be deemed to be also a document, if the conditions mentioned in this section are satisfied.
    • in relation to the information and
    • computer in question and
  • shall be admissible in any proceedings, without further proof or production of the original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible.

 

  1. Use of Non Obstante clause in S.65B(1)

Notwithstanding anything contained in this Act”  ~ See class notes for detailed discussion.

 

  1. 65B(2): Conditions (a) & (c)

a) The computer from which the record is generated was regularly used to store or process information in respect of activity regularly carried on by a person having lawful control over the period, and relates to the period over which the computer was regularly used;

c) The computer was operating properly, and if not, was not such as to affect the electronic record or its accuracy;

Broadly related to Computer’s integrity and Lawful Control

 

  1. What if computer is malfunctioning ?

Bank ATM – withdrawal case !

Sri. P. Padmanabh Vs. Syndicate Bank Limited, 2008 Karnataka High Court.

If Computer is malfunctioning output may become inadmissible.

ATM link lost > Person took out more money than he was entitled > Bank alleged defendant took advantage of computer malfunction > sued for recovery of that amount > in evidence, relied on electronic evidence of withdrawal of money > held : when the ATM/Computer itself was admittedly malfunctioning, output not admissible in evidence.

Therefore, the proper functioning of the computer > accuracy of data > chain of integrity is extremely important.

 

  1. 65B(2): Conditions (b) & (d)

b) Information was fed in computer in the ordinary course of the activities of the person having lawful control over the computer;

d) Information reproduced is such as is fed into computer in the ordinary course of activity.

Broadly related to informational integrity

 

  1. Certificate u/s Sec. 65B(4): Certificate :
  • identifying the electronic record containing the statement and describing the manner in which it was produced;
  • giving the particulars of any device involved in the production of that electronic record
  • dealing with any of the matters to which the conditions mentioned in sub-section (2) relate,

 

  1. Whether certificate u/s 65B Evidence Act is mandatory ?
  • Earlier view – No (State (NCT of Delhi) v. Navjot Sandhu (2005) SC)
  • Current view – Yes. ((ANVAR P.V. VS. P.K. BASHEER AND OTHERS – 2014 (SC) Navjot Sandhu stands overruled in this context by PV Anvar.
  • See Dictation Notes for detailed discussion.
  • Generalia Specialibus Non Derogant

 

  1. Oral Deposition as to conditions of S.65B(2) – whether sufficient compliance ?

Oral Statement in court as to compliance of Section 65B of the IEA will not suffice and certificate u/s 65B is mandatory.  Jagdeo Singh and Ors. Vs. The State (2015) Delhi High Court

Principle : When something is categorically prescribed to be done in law in a certain manner, it has to be done in that manner alone and no other.

 

  1. Who is Competent to issue the certificate ?

After mentioning the contents of the certificate, the latter part of Section 65B(4) reads as under :-

  • and purporting to be signed by a person.
  • occupying a responsible official position in relation to the operation of the relevant device or
  • the management of the relevant activities (whichever is appropriate)
  • shall be evidence of any matter stated in the certificate; and for the purposes of this sub-section it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it.

 

Section 65B(4) Certificate and the Doctrine of Hearsay

  • In cases where information as to proper functioning of computer system/server is derived from system logs, made in the ordinary course of business, a witness deriving his knowledge from such written records can produce certificate u/s 65B(4) and prove the electronic record and his testimony is not barred by doctrine of hearsay.
  • This is premised on the fact that : Proper functioning of the computer in such cases is not a matter of personal testimonial knowledge but knowledge derived from records maintained in the usual course of working of the system.
  • Doctrine of hearsay primarily applies in the domain of oral evidence.
  • Doctrine of hearsay limited in its application in cases of Electronic Evidence. (Kundan Singh Vs. The State (2015) Delhi High Court)

 

 

  1. Stage of filing of certificate u/s 65B(4) ? Is it mandatory to file it alongside the electronic evidence output or can it be filed later ?
  • Certificate u/s 65B IEA can be filed even after receipt of document/Electronic evidence on record.
  • Court may invoke Sections 91, 311,391 of the CrPC to facilitate filing of certificate. Investigating authority (police) can also file the certificate alongwith a supplementary police report u/s 173(8) of the CrPC.
  • In civil proceedings, Ord. XVI R. 14, Ord. XVIII R.17 r/w 151 CPC can be used to recall a witness for the purpose of certificate.

 

(See : Kundan Singh Vs. The State (2015) Delhi High Court & Paras Jain and Ors. Vs. State of Rajasthan,(2015) Raj. HC).

 

  1. Whether judicial admission by the opposite party as to the electronic record dispenses with formal proof and compliance of Section 65B of the IEA ?

 

Judicial Admission by the Witness as to electronic record waives the requirement of formal proof and conditions of Section 65B IEA need not be complied with.  (Shamsher Singh Verma Vs. State of Haryana, 2015 – SC)

 

  1. E-Contract – territorial jurisdiction;

 

Section 13(3) of the IT Act reads as under :-

 

(3) Save as otherwise agreed to between the originator and the addressee, an electronic record is deemed to be despatched at the place where the originator has his place of business, and is deemed to be received at the place where the addressee has his place of business.

 

P.R. Transport Agency vs. Union of India & others – 2005 SCC OnLine All 880 Allahabad High Court.

  • No expert opinion can be led w.r.t an electronic evidence without first complying with Section 65B of the IEA. (See Anvar P.V v. P K Basheer, 2014 SC)

 

  1. Electronic Evidence Vis-à-vis Criminal Law and the Constitution.
    • Section 27 of IEA or Section 65B – which one is to prevail ?
    • Certificate from the Accused u/s 65B(4) IEA – is it a violation of Article 20(3) of the Indian Constitution ?
Civil Law

Grant of Mandatory Injunction – Factors

Supreme Court of India
Makers Devt.Services P.Ltd. vs M. Visvesvaraya Indusl.Res.& … on 14 November, 2011

Suit for Specific Performance filed by Plaintiff – Pending Suit, Plaintiff sought for interim injunction restraining Defendant dealing with suit property and to permit Plaintiff to put up further construction – Interim relief to permit further construction sought by Plaintiff, if granted, would create enormous difficulty to Defendant in event of dismissal of main Suit later – Interim relief sought by Plaintiff is in nature of mandatory injunction and not mere prohibitory order – Same cannot be granted – Courts while granting injunction must take into consideration conduct of parties – Order of Division Bench refusing to grant interim relief in nature of positive mandatory injunction cannot be faulted with.

Bench: P. Sathasivam, J. Chelameswar

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 9709 OF 2011

(Arising out of SLP (C) No. 22276 of 2011

Makers Development Services Pvt. Ltd. …. Appellant (s) Versus

M. Visvesvaraya Industrial Research and

Development Centre …. Respondent(s) WITH

CIVIL APPEAL NO. 9710 OF 2011

(Arising out of SLP (C) No. 25972 of 2011)

J U D G M E N T

P. Sathasivam, J.

1) Leave granted in both the Special Leave Petitions. Both these appeals were heard together as they arose out of the same set of facts and common questions of law were involved. 2) SLP (C) No. 22276 of 2011 has been filed by the Makers Development Services Pvt. Ltd. against the order dated 28.06.2011 passed by the Division Bench of the Bombay High 1

Court in Appeal No. 280 of 2008 challenging the order dated 25.04.2008 passed by the learned Single Judge in Notice of Motion No. 3499 of 2007 in Suit No. 2618 of 2007 declining the reliefs claimed in prayer clauses (a) to (f) pending final disposal of the Suit and SLP (C) No. 25972 of 2011 has been filed by M. Visvesvaraya Industrial Research and Development Centre against the same order in Appeal No. 289 of 2008 in Notice of Motion No. 3499 of 2007 in Suit No. 2618 of 2007 granting relief in terms of prayer clause (g).

3) Brief facts:

a) Makers Development Services Pvt. Ltd.-the appellant herein (Original Plaintiff) is a Company registered under the Companies Act, 1956 engaged in the business of development, building, including the construction and management of hotels and developments pertaining to other hospitality services and management of properties. M. Visvesvaraya Industrial Research and Development Centre-the respondent herein (Original Defendant) is a Company incorporated under the Companies Act, 1956 and is engaged, inter alia, in 2

promoting, establishing, conducting and undertaking scientific research.

b) The Government of Maharashtra, by Resolutions dated 16.10.1970 and 18.11.1974, had granted lease of certain plots of land to the defendant-Company at Backbay Reclamation, Cuffe Parade, Mumbai, who was entitled and authorized to enter into transactions with third parties in respect of the said land. A portion of that land admeasuring 13,326 sq. mts. which forms a part of the larger land held by the defendant- Company is the subject-matter of the present case. c) An agreement dated 10.11.1980 was entered into between the parties for construction of a composite hotel complex consisting of a Hotel Building, a Convention Centre and an Exhibition Centre on the Suit Land (Tower No.2) and the plaintiff would be granted lease of Hotel (exclusive of the Convention and Exhibition Centre) for 60 years with an option of renewal of lease. This agreement came to be modified from time to time.

3

d) Pursuant to the Agreement, the respondent put the appellant in possession of the Suit Land on 16.07.1990, which continues to remain with the appellant till date. e) Since the appellant could not complete the work and due to disputes and differences, the respondent, on 31.07.2007, affixed a notice on the premises notifying all concerned including the appellant to move out of the property and instructed its security persons not to permit the appellant to enter upon the said property.

f) On 04.08.2007, the appellant filed a suit for injunction before the City Civil Court, Mumbai seeking interim and final reliefs restraining the respondent from taking any illegal steps. By order dated 06.08.2007, the learned Judge held that till the substantive suit is filed by the appellant, the impugned notice dated 31.07.2007 will not be acted upon by the defendants upto and inclusive of 17.09.2007.

g) On 10.09.2007, the appellant moved a Notice of Motion No. 3499 of 2007 in a Suit being No. 2618 of 2007 before the learned Single Judge of the Bombay High Court for a decree of specific performance, inter alia, praying for a permanent 4

injunction restraining the respondent from dispossessing the appellant. By ad-interim order dated 14.09.2007, the assurance given in the City Civil Court was directed to be observed and the respondent was directed not to create any third party rights pending the Notice of Motion. During the pendency of the suit, by letter dated 19.11.2007, the respondent terminated the said Agreement. The learned single Judge, after referring the documents and affidavits on record, rejected prayer clauses (a) to (f) of the Notice of Motion and granted limited interim relief with regard to prayer clause (g) in favour of the appellant.

h) Aggrieved by the order of the learned single Judge, the appellant preferred an appeal being Appeal No. 280 of 2008 before the Division Bench of the High Court. With regard to the limited relief granted by the learned single Judge, the respondent also filed an appeal being Appeal No. 289 of 2008 before the Division Bench of the High Court.

i) The Division Bench, by a common judgment, upheld the order of the learned single Judge and dismissed both the appeals. Challenging the order of the Division Bench of the 5

High Court, the appellant and the respondent filed separate special leave petitions before this Court.

4) Heard Mr. Shyam Divan, learned senior counsel for the appellant and Mr. Mukul Rohatgi & Mr. Praveen Samdani, learned senior counsel for the respondent.

5) The points for consideration in these appeals are:- a) Whether the appellant/plaintiff has made out a case for grant of injunction in its entirety, i.e. prayer clauses (a) to (g)?

b) Whether learned single Judge as well as Division Bench of the High Court committed an error in granting limited relief in respect of clause (g)?

6) It is settled law that while passing an interim order of injunction under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908, the Court is required to consider three basic principles, namely, a) prima facie case, b) balance of convenience and inconvenience and c) irreparable loss and injury. In addition to the above mentioned three basic principles, a court, while granting injunction must also take into consideration the conduct of the parties. It is also 6

established law that the Court should not interfere only because the property is a very valuable one. Grant or refusal of injunction has serious consequences depending upon the nature thereof and in dealing with such matters the court must make all endeavours to protect the interest of the parties.

7) With the above principles, let us consider the claim of both the parties.

8) The appellant/plaintiff, who filed Suit No. 2618 of 2007 on the file of original side of the High Court of Bombay prayed for the following interim reliefs pending hearing and final disposal of the said suit:

"(a) That pending the hearing and final disposal of the Suit, the Defendant be ordered and directed to do, sign, execute, deliver and register all such acts, deeds, matters writings, documents, authorities papers, plans, sanctions and things as may be necessary to enable the Plaintiff to continue construction on the Suit Land in terms of the Suit Contract;

(b) That pending the hearing and final disposal of the Suit, the Defendant by itself, its servants and agents or any person or persons claiming by, from, through or under them be restrained by an order and injunction of this Court from dispossessing the Plaintiff or removing the authorized representatives, employees, staff, workers and labourers of the Plaintiff and their respective family member or their belongings and articles or the construction materials, equipment and other belongings of the Plaintiff from the Suit Land;

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(c) That pending the hearing and final disposal of the Suit, it be ordered and decreed that the Defendant to allow the Plaintiff to continue construction on the Suit Land and unhindered access to the Suit Land and allow ingress to and egress from the Suit Land, by the Plaintiff, its representatives, employees and contract labour as also for all construction materials and equipment without in any manner, directly or indirectly, obstructing or hindering the Plaintiff.

(d) That pending the hearing and final disposal of the Suit, the Defendant by itself, its servants and agents or any person or persons claiming by, from, though or under them be restrained by an order and injunction of this Court from in any manner restraining, preventing impending or obstructing implementation of the Suit Contract or construction on the Suit Land or access to and ingress to and egress from the Suit Land, of the Plaintiff or its authorized representatives, employees, workers, labourers and their respective family members or preventing, impeding or obstructing construction material or equipment of the Plaintiff from being brought on to the Suit land or in any manner, directly or indirectly, by any act of omission or commission, withholding or causing to be withheld essential utilities such as power and water supply to the Suit Land for construction by the Plaintiff;

(e) That pending the hearing and final disposal of the Suit, the Defendant by itself, its servants and agents or any person or persons claiming by, from, through or under them be restrained by an order and injunction of this Court from in any manner, whether directly or indirectly, revoking or acting on any purported revocation of the Letter of Authority granted by the Defendant to the Plaintiff or in any manner, whether directly or indirectly, hindering, impeding or obstructing construction on the Suit Land in terms of the Suit Land in terms of the Suit Contract;

(f) That pending the hearing and final disposal of the Suit, the Defendant by itself, its servants and agents or any person or persons claiming by, from, through or under them be restrained by an order and injunction of this Court from in any manner committing unlawful trespass or from in any manner intimidating the Plaintiff, its employees, workers, labourers and other agencies appointed by the Plaintiff; 8

(g) That pending the hearing and final disposal of the Suit, the Defendant by itself, its servants and agents or any person or persons claiming by, from, through or under them be restrained by an order and injunction of this Court from, in any manner, selling transferring, dealing with, disposing of, alienating encumbering or creating any third party rights or interest in, or entering into any agreement or arrangement with any one else in respect of the Suit Land or any part thereof;"

9) Among the above prayers for interim reliefs, the learned single Judge granted relief only in respect of prayer clause (g) that too with a condition, namely, except the words "dealing with". The learned single Judge on satisfying himself and after thorough scrutiny of the materials placed rejected the relief insofar as prayer clauses (a) to (f), which resulted in filing of above two appeals by the appellant and the defendant. It is the claim of the appellant/plaintiff that on the basis of the contract between the parties, the learned single Judge and the Division Bench should have granted an order permitting the appellant to carry on further construction especially when construction of about 80 ft. had already been raised by the appellant on the suit land. On the other hand, it is the case of the defendant that there is no existing agreement between the parties and the only point is that the parties have agreed to 9

enter into an agreement and, therefore, the learned single Judge as well as the Division bench were not justified even in granting interim order in terms of prayer (g).

10) Inasmuch as the main suit is pending, it would not be proper for this Court to delve into the matter and arrive at a categorical finding one way or other. Accordingly, we have to find out whether there is prima facie case and `balance of convenience’ in terms of principles mentioned above. 11) The finding of the learned single Judge about the construction of the building to the height of 80 ft. on the suit land by the appellant cannot be ignored. However, whether the defendant permitted the appellant to enter on the suit land and to carry on construction are all matters to be decided in the main suit. The limited relief granted in clause (g) by the learned single Judge is quite understandable, otherwise, it could be possible for the defendant to deal with the suit land with third parties or encumber it before the final disposal of the suit. However, as rightly observed by the learned single Judge as well as Division Bench, if other reliefs which we have already extracted above are granted, in the event of dismissal 1

of a suit, undoubtedly, it would create enormous difficulties for the defendant using the plot or land freely and without any difficulty. In other words, if the appellant was allowed to proceed with the construction on the suit land, in the event of dismissal of suit, the defendant cannot use the land in a different manner with the structure without undertaking an enormous exercise of demolishing the same. Further, what was claimed by the plaintiff was not a mere prohibitory order but prayed for positive mandatory injunction which, as rightly observed by the Division Bench, would permit the plaintiff to alter the status quo on the suit land on the date of the suit. 12) The learned single Judge as well as Division Bench on appreciation of entire materials rendered the factual finding that the balance of convenience is not in favour of granting such mandatory interim order as claimed in prayer clauses (a) to (f). It is relevant to point out that though the appellant had stated that it had started construction in the year 1996, even after the information by the defendant to the appellant in 2002 that the BEST had given their `no objection’ for the demolition of temporary receiving station and the appellant can proceed 1

with the demolition, however, the fact remains, the height of the construction was only 80 ft. which shows that from the year 2001 to 2007, the appellant had not carried on construction and there was no obstruction from the side of the defendant. In view of all these factual aspects and in the light of the stand of the defendant disputing the existence of the agreement, as rightly observed by the learned single Judge as well as Division Bench, further permission for construction or ancillary works cannot be granted during the pendency of the suit. We are satisfied that the learned single Judge was fully justified in granting limited relief in respect of prayer clause (g) and declined the other reliefs in clauses (a) to (f). The Division Bench was also fully justified in confirming the said limited order. Though learned senior counsel for the respondent has prayed for certain directions such as execution of a mortgage deed etc., for the same reasons mentioned above, we are not inclined to grant such relief as claimed. As observed earlier, at this stage, it is not desirable to go into all the details and render a specific finding which would undoubtedly affect the claim of both the parties in the main suit. On the other hand, 1

we are in entire agreement with the prima facie conclusion arrived at by the learned single Judge and the Division Bench. 13) Inasmuch as, as early as on 25.04.2008, the learned single Judge directed hearing of the suit be expedited, taking note of various other aspects/impediments highlighted by both the parties including construction of a protection/security wall on the sea side, we request the learned single Judge of the High Court to dispose of the suit being No. 2618 of 2007 as early as possible preferably within a period of nine months from the date of the receipt of the copy of this judgment. We also direct both the parties to cooperate with the court for early conclusion of the hearing as directed above. 14) In the light of the above discussion and reasonings, we find no merit in both the appeals, consequently, they are dismissed with no order as to costs.

……………….

…………………………J.

(P. SATHASIVAM)

………………………………………..J. (JASTI CHELAMESWAR)

NEW DELHI;

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NOVEMBER 14, 2011.

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