Supreme Court Restores Suit After Holding High Court Could Not Dismiss Substantive Relief While Hearing Interlocutory Appeal

A bench of Justice Pamidighantam Sri Narasimha and Justice Joymalya Bagchi heard appeals arising out of SLP (C) Nos. 37012-37013 of 2013 and considered whether a High Court, on an appeal against an order refusing interim injunction, could dismiss substantive reliefs and direct that those reliefs be agitated in a suit filed by the defendant in relation to possession of a shop in Parel, Mumbai.

The Court allowed the appeals, set aside the High Court judgment and order dated 14.08.2013, and restored Civil Suit (L) No. 2217 of 2012 to its original number. The Supreme Court held that the High Court erred in dismissing the substantive portion of the suit while deciding an application for interim relief and in treating the appellants’ declaratory claims as infructuous. The Court directed that, pending disposal of the suit, the respondents were restrained from dispossessing the appellants. The Court, in its reasoning, observed: “In an appeal to the High Court against the order of the Trial Court refusing to grant injunction pending disposal of the suit, the High Court could not have dismissed the substantive portion of the suit itself and direct that the remaining part of the suit be agitated in a suit filed by the defendant. The approach adopted by the High Court is completely illegal and unsustainable in law.” The bench further recorded its operative disposition: “we allow the appeals, set aside the judgment and order dated 14.08.2013 … and restore the suit filed by the appellants … to its original number.” The Court also clarified that it had “not expressed any opinion on the merits of the matter.”

Background

The dispute arose between descendants of three co-tenant brothers who held a shop at 220-222, N.M. Joshi Marg, Parel, Mumbai. The appellants claimed that Mr. Deepnarayan Chotanki Gupta (respondent No.1’s predecessor) had, by a notarised affidavit dated 22.02.1990, transferred his rights in the tenanted premises to Mr. Magruram Chotanki Gupta (appellants’ predecessor), and that Deepnarayan’s widow executed a declaration dated 18.04.1998 relinquishing her rights in favour of appellant No.1. Relying on those documents, the appellants filed Civil Suit (L) No. 2217 of 2012 seeking declaratory reliefs and permanent injunction; they also sought interim protection, which the Trial Court refused on 21.12.2012.

Respondent No.1 instituted Suit No. 443 of 2013 in the High Court for recovery of possession and related reliefs. On appeal from the Trial Court’s refusal of interim relief, the High Court recorded respondent No.1’s counsel as stating that he would not dispossess the appellants “until respondent No.1 obtains an order or decree in his suit,” and then concluded inconsistently that certain prayers in the appellants’ suit had become “infructuous.” The High Court held that the notarised documents relied on by the appellants were “admittedly unregistered” and “fall within the mischief of Section 49 of the Registration Act, 1908,” and proceeded to dismiss prayers (a) and (b) seeking declaration while granting protection in terms of the defendant’s statement for prayers (c), (d) and (e).

The Supreme Court found that the High Court, while deciding an interlocutory matter, had no occasion to finally adjudicate the legality, validity or admissibility of the impugned documents and that those issues should be considered at trial. The apex court characterised the High Court’s approach as “completely illegal and unsustainable in law,” set aside the impugned order, restored the appellants’ suit to its original number, and directed a restraining order against dispossession pending disposal of the suit. The Court disposed of pending applications, made no order as to costs, and expressly refrained from expressing any opinion on the merits.

Case No.: 2025 INSC 651 (Arising out of SLP (C) Nos. 37012-37013 of 2013) Case Title: MAHENDRA MAGRURAM GUPTA & ANR. v. RAJDAI SHAW & ORS. Appearances: (List advocates if available, for both sides using the format) For the Petitioner(s): Counsel not indicated in the order For the Respondent(s): Mr. Sanglikar, Advocate for Respondent No.1