Vishwajith Shetty J
1. The instant commercial appeal is filed by the appellant, who is the plaintiff before the trial court seeking to set aside the order dated 20th February
2021 passed by the LXXXII Addl.City Civil and Sessions Judge and Commercial Court, Bengaluru, on I.A.Nos.1 to 3 in Commercial
O.S.No.306/2020 and the appellant has also filed the following I.As. in this appeal:
a) I.A.No.1/2021 seeking stay of the impugned order;
b) I.A.No.2/2021 for production of additional documents;
c) I.A.No.3/2021 for an order of temporary injunction restraining the respondent No.1 to 3 from using the disputed registered trademarks until final
disposal of the appeal;
d) I.A.No.4/2021 for an order of temporary injunction restraining the respondent Nos.1 to 3 from using any products or services connected with the
jewellery business, the disputed trademarks until final disposal of the appeal;
e) I.A.No.5/2021 for staying the operation of the common order in I.A.Nos.1 to 3 dated 20.2.2021 and all further proceedings in
Com.O.S.No.306/2020 and all further proceedings therein.
2. The appellant, a Private Limited Company had filed Commercial O.S.No.306/2020 before the trial court praying for a judgment and decree of
perpetual injunction restraining the respondents and persons claiming through or under them from using the trademarks ""C.Krishniah Chetty Corp.,
C.Krishniah Chetty & Co., Chetty & Co. Chetty, C.Krishniah Chetty & Co.1869, Chetty & Co. 1869, Chetty 1869.
3. The appellant Company is engaged in the business of Gems and Jewellery. In the year 1869 Sri.C.Krishnaiah Chetty had commenced the jewellery
business in the property bearing No.35, Commercial Street, Bangalore. After his death, the business was carried on by his son Sri.Adinarayana Chetty
and   grandson Sri.Venkatachalapathy Chetty until their demise in the year 1955 and 1956 respectively. Subsequently C.V.Narayana, who is the
father of respondent No.2 and late husband of respondent No.3 herein and C.V.Hayagriv carried on the said family business as a partnership firm
with equal share in the profits.
4. On 01.04.1958, a partnership firm was constituted by Sri.C.V.Hayagriv and late Smt.C.V.Ashwathamma acting for herself and as a guardian of
her minor son C.V.Narayana and the aforesaid first partners had admitted the minor C.V.Narayana to the benefits of the partnership and it was also
recognized and agreed by the parties that the jewellery business was taken over as a family assets and divided into equal shares between
C.V.Hayagriv and minor C.V.Narayana represented by his mother and guardian Smt.Ashwathamma. The Deed of Partnership dated 10.04.1958 was
amended and re-constituted on 02.10.1978. The appellant Company was incorporated   on 24.12.1979 by Sri.C.V.Narayana and C.V.Hayagriv
and subsequently the appellant Company was included as a partner of the partnership firm under a Deed dated 03.01.1980. In a Board Meeting dated
19.03.1980, a decision was taken to dissolve the partnership firm and the business and assets of the said firm was taken over by the appellant
Company and by Deed of Dissolution dated 28.04.1980, the partnership firm was dissolved and the business of the said firm was taken over by the
appellant Company along with all its assets and liabilities which included the trademark of the partnership firm.
5. The family of C.V.Narayana and C.V.Hayagriv held 50% equity shares each in the company. After the death of C.V.Hayagriv, his son C.Vinod
Hayagriv, wife Vishala Hayagriv and daughter-in-law Triveni Vinod are holding 50% equity shares in the company while the remaining 50%
shareholding of the company is held by respondent Nos.2 and 3, who are the son and widow of C.V.Narayana.
6. Respondent No.1 is a Company engaged in the business of Gems and Jewellery and was incorporated in the year 1982 by Vinod Hayagriv,
C.Vishala Hayagriv and C.V.Narayana. Initially both branches of family held shares in respondent No.1 Company. Subsequently the entire
shareholding of respondent No.1 Company was transferred to the name of respondent No.2 herein at a fair market value.
7. Presently respondent Nos.2 and 3 are the Directors and shareholders of respondent No.1 Company. The appellant and respondent No.1 carried on
their business in the same premises and the registered office of both the companies is also located in a common premises. Respondent no.4 is the wife
of second respondent and respondent no.5 is a Company, which has been marketing the business of the first respondent Company online.
8. Sri.C.V.Hayagriv's family later on had incorporated Company known as ""C.Krishnaiah Chetty Jewellery Pvt.Ltd."" and allegedly diverted the
business   of the appellant Company to the newly incorporated Company. In view of various acts of oppression and mismanagement including
diversion of business from the appellant Company, there was discord in the family and therefore, a family settlement agreement was entered into
between the two branches of the family on 09.01.2014 for amicable division of the business of the appellant Company and the appellant, all C.K.C.
entities, all shareholders of both the branches of the family, respondent No.1 and C.Krishnaiah Chetty Jewelleries Private Limited, which was a
Company incorporated by the family of C.V.Hayagriv, were the signatories to the family settlement agreement.
9. After the execution of the family settlement agreement, alleging that C.V.Hayagriv and his family members had further indulged in oppression and
mismanagement, respondent no.3 herein filed a Company Petition on 16.09.2014 before the Company Law Board, Chennai interalia seeking
proportional representation on the Board, maintenance of status quo   until the family settlement agreement is final and to restrain C.V.Hayagriv
and his family members from diverting the business of appellant Company.
10. The said case was subsequently transferred to N.C.L.T., Bangalore and numbered as T.P.No.65/2016. During the pendency of the said petition,
on 05.03.2018 C.V.Hayagriv and his family had filed I.A.No.54/2018 in the said case interalia seeking to restrain respondent Nos.2 and 3 herein from
carrying on competing business in the very same premises. The said application and the main petition were subsequently dismissed by N.C.L.T.,
Bangalore on 24.01.2019. Being aggrieved by the order dated 24.01.2019, C.V.Hayagriv and his family members had filed Company Appeal
No.33/2019 while Company Appeal No.65/2019 was filed by the third respondent herein challenging the very same order before the N.C.L.A.T.,
New Delhi. Subsequently Company Appeal no.33/2019 was withdrawn before the N.C.L.A.T. while Company Appeal no.65/2019 is pending
consideration.
On 19.12.2019, the appellant Company had undertaken before the N.C.L.A.T., New Delhi in Company Appeal No.65/2019 that no Board meeting will
be held until further orders from the said Tribunal. The said order is still in force.
11. In the meanwhile, it appears that the first respondent Company had filed certain applications for registration of identical trademarks and objections
were filed by the appellant Company for the same. The competent authority while allowing some of the applications had also rejected a few
applications. Being aggrieved by the registration of certain trademarks in favour of the first respondent Company, the appellant had filed rectification
proceedings before the Intellectual Property Appellate Board on 14.09.2020. During the pendency of the said proceedings, the present suit was filed
on 02.11.2020. During the pendency of this suit, the Intellectual Property Appellate Board had granted an interim order staying   the operation of
the first respondent's trademarks vide its order dated 19.01.2021.
12. The respondents after service of notice in the present suit had filed a detailed written statement. According to the respondents, C.Vinod Hayagriv
and his family members, who have got 50% shareholdings in the appellant Company, had got this suit filed against the respondents for the alleged
infringement of trademarks of the appellant by the respondent Nos.2 and 3 who are the holders of remaining 50% shares of the appellant Company.
The respondents in their written statement in addition to traversing the plaint averments have also raised an objection with regard to the maintainability
of the suit on the ground that the suit has not been instituted by a competent person and the person who has signed the pleadings and instituted the suit
has not been authorised by the company by passing a Board resolution to the said effect.
13. In the suit, the appellant had also filed three applications. I.A.Nos.1 and 2 are filed by the appellant   under Order XXXIX Rule 1 and 2 read
with Section 151 of CPC and I.A.No.3 is filed under Order XXXIX Rule 7 read with Section 151 of CPC. I.A.No.1 is filed seeking for grant of ad-
interim order of temporary injunction restraining the opponents/defendants from using in relation to any products or services connected with the
jewellery business in classes 14, 16, 21, 35, 36, 37 and 42 and the disputed trademarks. I.A.No.2 is filed seeking to grant an ad-interim order of
temporary injunction restraining the opponents/defendants from using any other trademark in relation to any business amounting to passing off of the
goodwill and reputation in and to the plaintiff's earlier well known house marks till disposal of the suit. I.A.No.3 is filed seeking for an order to direct
the defendants to preserve any/all materials bearing the identical and deceptively similar trademarks mentioned in the application. The respondents had
filed objections to the said applications.
14. The trial court after hearing the arguments of the learned counsel appearing on both sides had formulated the following points for consideration :
1. Whether the applicant/plaintiff proves the prima facie case about alleged using of Trademarks by the defendants as contended in I.A.Nos.I and II?
2. Whether the balance of convenience lies in favour of the applicant/plaintiff:
3. Whether the applicant/plaintiff suffers any irreparable injury which cannot be compensated in terms of money if the temporary injunction is not
granted?
4. Whether the defendants are directed to be ordered to preserve any/all materials bearing the identical and similar trademarks to that of the plaintiff
as prayed in I.A.No.III?
5. What order?
15. The trial court vide the order impugned having answered all the points for consideration in the   negative has also observed that the suit itself is
not maintainable without resolution of Board of Directors of the Company delegating authority to file the suit and it has been made clear that such an
observation about maintainability of the suit is made only for the purpose of deciding the applications.
16. In the present appeal, after service of notice, the defendants have filed a detailed statement of objections and have raised preliminary objection
with regard to the maintainability of the appeal on the ground that no Board resolution or authorisation has been submitted by the signatory to the
appeal who is the alleged Chief Financial Officer of the appellant Company to file the present appeal on behalf of the appellant. Having regard to this
preliminary objection, this court on 20.04.2021 at the request of learned counsel for the appellant had granted time to argue the matter on the issue of
maintainability and directed relisting of the matter on 23.04.2021. On 23.04.2021, learned Senior Counsel Sri. Amit Sibal appearing on   behalf of
the appellant and learned Senior Counsel Sri.Uday Holla appearing on behalf of the respondents have made their submissions regarding maintainability
of the present appeal.
17. Learned Senior Counsel for the appellant submitted that the present appeal is maintainable and is validly filed. He has relied upon the judgment of
the High Court of Delhi in the case of Glaxo Group Ltd. and Another -vs- Sunlife Sciences Pvt.Ltd.1 wherein in paragraphs-19 and 20, it is observed
as under:
19. In case titled Haryana Financial Corp. & Anr. v. Jagdamba Oil Mills & Anr., AIR 2002 SC 834, the Supreme Court has very categorically laid
down that while applying the law enunciated in the particular case, the Court should not act mathematically and the law which is laid down in the
reported case should not be applied like theorems. The facts of the reported judgment in Electric Construction Company case (supra) must be seen in
the light of these facts. The reasons for distinguishing the facts of that case have been given herein before, which was primarily the nature of the suit
as well as the fact that the said suit was being 2011(45) PTC 561 ((Del) Â Â decided finally on merits while as in the instant case Court has to decide
the application under Order XXXIX Rules 1 and 2 CPC only at this stage.
20. In addition to this, the Apex Court in Sangram Singh v. Election Tribunal (AIR 195 SC 425) observed that:
A code of procedure is procedure, something designed to facilitate justice and further its ends : not a Penal enactment for punishment and penalties;
not a thing designed to trip people up. Too technical construction of sections that leaves no room for reasonable elasticity of interpretation should
therefore be guarded against (provided always that justice is done to both sides) lest the very means designed for the furtherance of justice be used to
frustrate it.
18. He has also relied upon Order XXIX Rule 1 of CPC and contended that the present appeal filed by the Company represented by its Chief
Financial Officer is valid and in support of his contention, he has relied upon a judgment of the Bombay High Court in the case of The Calico Printers'
Association Ltd. -vs- Â A.A.Karim and Bros.,2 wherein it has been held as follows:
. . . . . .the proper construction to put upon the two rules taken together is this, that under Order VI, Rule 14, the pleading must be signed by the party,
but where the party is a company and therefore unable to sign, it necessarily follows, having regard to the words "" or for other good cause,"" that the
last part of the section always applies in the case of a company, and that the company therefore can always authorise some person to sign on behalf
of the company. If the company does not choose to do that, it can act under Order XXIX, Rule 1, i.e., it can rely on that order as in fact constituting
an agent to sign without the necessity of giving any express authority. In that way Order XXIX is read as merely permissive and not mandatory, In
point of form it is clearly permissive and not mandatory.
19. He has also relied upon the judgment of the High Court of Allahabad in Bhanu Pratap Mehta -vs- AIR 1930 BOM 566 Â Â Brij Leasing (P) Ltd.
and Others3 wherein in paragraphs -13 and 14 it is held as follows:
13) In the case of Bharat Petroleum Corporation Limited v. M/s. Amar Autos, 2008(5) ADJ 584 (DB), a similar argument has been raised by the
learned counsel for the respondent relying upon the decision of the Delhi High Court in the case of M/s. Nibro Limited v. National Insurance
Company Ltd. (supra). This Court negated the submissions and held as follows :
Upon considering the pros and cons of the matter we are of the view that the learned Judge of the Court below has proceeded in a wrong premises
and with hot-haste. According to us, a power of attorney or an affidavit of such nature is only required to prima facie satisfy the Court that a company
or corporation or a body corporate has presumably proceeded with the suit under its seal and signature, it has nothing to do with the registration of the
document unless it is compulsorily remittable. Persuasive value of M/s Nibro Ltd. (supra) cannot pursue us. There is a thinner line in between
authorization to sign and verify the pleadings, and to institute a suit on behalf of the corporation, company or a body corporate. Whenever a person is
authorised to sign and verify the pleadings other than verification of plaint, written statement, memorandum of appeal, etc., it is doing so by filing
affidavit in support of 2011(4) ADJ 125 Â Â such contentions. Therefore, it stands on a better position than ordinary verification.
But a person when verifies the plaint, written statement or memorandum of appeal, it is a verification simplicitor, meaning thereby that the verification
part is also to be evidently proved unlike an affidavit, which itself is an evidence. Hence, authorization to institute a suit stands in the lower side than
putting signature and verifying a pleading by way of an affidavit. On the other hand, signature and verification of the pleading of a plaint cannot be
made for the sake of signature and verification alone but for the purpose of filing of the same before the Court either by him or by his learned
Advocate. As soon as it is filed, the same will be treated to be institution of such proceeding by the person who has signed and verified. It is
automatic. Institution of suit and right to institute the suit are distinct and different. The argument of Mr. Shashi Nandan restricted only to the first part
of Order XXIX, Rule 1 of C.P.C. but not to the last part. If the suit is proceeded and the evidence is led and if any of the defendants want to
challenge the verification of the plaint, he can call the deponent as witness for the purpose of examination. But Court cannot prevent any one from
instituting a suit when his authority is apparently satisfactory. No body will be prevented from enforcing his legal right. It is a gross mistake on the part
of the Court below to construe that the power of attorney should be registered and then only the suit can be instituted by a representative of the
company or corporation. Moreover justification of filing the plaint by the authorised representative of the corporation or company will be
  considered from the practical point of view. If the Court below is not happy, it could have called upon the company to file an affidavit of
competency, which is desirable under such circumstances, but not outright rejection of the plaint. Therefore, from any angle the order/s impugned
appear to be perverse in nature. Thus, in totality the orders impugned in both the appeal cannot be sustained. Hence, the orders dated 24th January,
2008 passed by the Court below in the above referred suits, impugned in the instant appeals, are set aside. Thus, both the appeals are allowed without
imposing any cost.
(14) In my view the Division Bench decision of this Court referred hereinabove squarely covers the issue.
20. He has further relied upon the judgment of the High court of Delhi in the case of Seritec Electronics Pvt.Ltd. -vs- M/s.Computer Peripheral
Solutions4wherein it is observed as follows:
A similar issue has been dealt with by me in the judgment reported as Mahanagar Telephone Nigam Ltd. Vs. Smt. Suman Sharma 2011 (I) AD Delhi
331 wherein I have relied upon the judgment of the Supreme Court in the case of United Bank of India Vs. Naresh Kumar & others
MANU/DE/0763/2014 Â Â (1996) 6 SCC 660 to hold that on technical grounds suits should not be dismissed if they are contested to the hilt i.e till last
stage. I have also held in the judgment in the case of Smt. Suman Sharma (supra) that issue of authorization for filing of the suit is only relevant when
there are disputes inter se shareholders i.e there are two groups of shareholders with respect to control of the company, and otherwise Order 29 Rule
1 CPC empowers any principal officer of a company to institute and continue the suit. The relevant paras of the judgment in the case of Smt. Suman
Sharma (supra) read as under:-
4. This aspect, with respect to the authority to sign and verify the suit by a principal officer has been dealt with by a Division Bench of this Court in
the case of Kingston Computers (I) P. Ltd. Vs. State Bank of Travancore 153 (2008) DLT 239 (DB) and in which, it has been held that a principal
officer is authorized by virtue of Order 29 Rule 1 CPC not only to sign and verify the pleadings, but also therefore to institute the suit.
21. Learned Senior Counsel has also argued that the defect in the present appeal is a curable defect and the same is not fatal. He has submitted that
such defect can be cured subsequently by ratification. In   support of his argument, he has relied upon the judgment of the High Court of Bombay
in Alcon Electronics Pvt.Ltd. -vs- Celem S.A.5. wherein it is held as follows:
In my view the suit did not suffer from any jurisdictional infirmity and even if there was any such defect in not passing a specific resolution for filing a
suit against the defendant, the same was curable and thus plaint could not have been rejected on the ground of non-compliance of passing of a specific
resolution.
The Supreme Court has held that disputed questions cannot be decided at the time of considering an application filed under Order VII Rule 11(d) of
the Code of Civil Procedure. Such provision applies in cases only where the statement made by the plaintiff in the plaint, without any doubt or dispute
shows that the suit is barred by any law in force. The averments in the plaint are the germane, the pleas taken by the defendant in the written
statement would be wholly irrelevant at that stage. Supreme Court has held that it should 2015 (4) BomCR 107 Â Â appear from the averments in the
plaint itself that the same is barred by any law. It is not the case of the respondent that the suit, from the averments in the plaint itself, can be said to
be barred by law. Learned counsel appearing for the respondent does not dispute the statement of the appellant that the defect if any in not passing
any specific resolution authorising a Director to file a suit on behalf of the company against the defendant is a curable defect.
22. Per contra, learned senior counsel Sri.Uday Holla appearing for the respondents has contended that in the written statement filed in the suit and
also in the statement of objections filed in the present appeal, the respondents have categorically raised a preliminary objection with regard to the locus
of the Chief Financial Officer to represent the Company in the suit and in the appeal, in the absence of a valid resolution to the said effect by the
Board of Directors of the Company as required under Section 291 of the Companies Act, 1956. In support of his argument, he has relied upon
  the judgment of the Delhi High Court in the case of M/s.Nibro Limited -vs- National Insurance Co.Ltd.6 wherein at paragraphs-12, 13, 14 and 22
it is observed as follows:
12. Order 3 Rule 1 of the Code of Civil Procedure reads thus :
Any appearance, application or act in or to any court, required or authorised by law to be made or done by a party in such court, may except where
otherwise expressly provided by any law for the time being in force, be made or done by the party in person, or by his recognized agent or by a
pleader appearing, applying or action, as the case may be, on his behalf:
Provided that any such appearance shall, if the court so directs, be made by the party in person.
Order 29 Rule 1 of the Code of Civil Procedure reads thus :
In suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or be any director or other
principal officer of the corporation who is able to depose to the facts of the case.
13. Order 3, rule 1 provides that any appearance, application or act in or to any AIR 1991 DELHI 25 Â Â court required or authorise by law can be
made or done by the party in person or by his recognized agent or by a pleader appearing, applying or acting, as the case may be, on his behalf.
Provided of course, such an appearance, application or act in or to any court is required or authorised by law to be done or done by a party in such
court.
Where, however, there is an express provision of law, then that provision will prevail. Thus, if an authority is given to a pleader or a recognised agent
as provided by law, the recognised agent or pleader can file an appearance or file a suit in court if the party himself is not in a position to file it. In my
view, if a party is a company or a corporation, the recognised agent or a pleader has to be authorise by law to file such a plaint. Such an authority can
be given to a pleader or an agent in the case of a company by a person specifically authorised in this behalf. In other words, a pleader or an agent can
be authorised to file a suit on behalf of a company only by an authorised representative of the company. If a director or a secretary is authorised by
law, then he can certainly give the authority to another person as provided under Order 3, rule 1.
14. Order 29, rule 1 of the Code of Civil Procedure provides for subscription and verification of pleadings and states that in suits by or against the
corporation, any pleadings may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the
corporation who is able to depose to the facts of the case.
........
22. On the analysis of the judgments, it is clear that Order 29, rule 1 of the Code of Civil Procedure does not authorise persons mentioned therein to
institute suits on behalf of the corporation. It only authorises them to sign and verify the pleadings on behalf of the Corporation.. .
23. He submits that the said judgment in the case of M/s.Nibro(supra)has been confirmed by the Hon'ble Supreme Court in the case ofS tate Bank of
Travancore -vs- Kingston Computers India Private Limited7 Bank and he refers to paragraph-12 and 14 of the said judgment which reads as follows:
12. The trial Court then referred to the judgments of the Delhi High Court inM /s. Nibro Limited v. National Insurance Company Limited AIR 1991
Delhi 25, Shubh Shanti Services Limited v. Manjula S.Agarwalla and others (2005) 5 SCC 30, Delhi High Court (original side) Rules, 1967 and
proceeded to observe:
..............As already stated, it has not been averred in the plaint nor sought to be proved that any resolution had been passed by the Board of
Directors of the plaintiff company authorising Shri A.K.(2011) 11 SCC 524 Â Â Shukla to sign, verify and institute the suit. It has also not been
averred that the memorandum/articles of the plaintiff company give any right to Shri A.K. Shukla to sign, verify and institute a suit on behalf of the
plaintiff company. It, therefore, follows that the plaint has been instituted by Shri A.K. Shukla only on the authority of Sh. Raj K.Shukla, CEO of the
plaintiff company. Such an authority is not recognized under law and, therefore, I held that the plaint has not been instituted by an authorised person.
Issue No.1 is accordingly, decided against the plaintiff and in favour of the defendants.
13..........
14. In our view, the judgment under challenge is liable to be set aside because the respondent had not produced any evidence to prove that Shri Ashok
K.Shukla was appointed as a Director of the company and a resolution was passed by the Board of Directors of the company to file suit against the
appellant and authorised Shri Ashok K.Shukla to do so. The letter of authority issued by Shri Raj K.Shukla, who described himself as the Chief
Executive Officer of the company, was nothing but a scrap of paper because   no resolution was passed by the Board of Directors delegating its
powers to Shri Raj K.Shukla to authorise another person to file suit on behalf of the Company.
24. He submits that when the suit is not properly instituted and when final relief cannot be granted in such a suit, there cannot be any interim orders or
orders of injunction granted in such a suit. In support of his contention, he has relied upon the judgment of the Apex Court in the case of Cotton
Corporation of India Limited -vs- United Industrial Bank Limited and Others8, by referring to para-10 of the said judgment, which reads as under:
10. Mr Sen, learned counsel for the respondent Bank, contended that Section 41(b) is not at all attracted because it deals with perpetual injunction
and the temporary or interim injunction is regulated by the Code of Civil Procedure specially so provided in Section 37 of the Act. Expression
'injunction' in Section 41(b) is not qualified by an adjective and therefore, it would comprehend both interim and perpetual injunction. It is, however,
(1983) 4 SCC 625 Â Â true that Section 37 specifically provides that temporary injunctions which have to continue until a specified time or until
further order of the court are regulated by the Code of Civil Procedure. But if a dichotomy is introduced by confining Section 41 to perpetual injunction
only and Section 37 read with Order 39 of the Code of Civil Procedure being confined to temporary injunction, an unnecessary grey area will develop.
It is indisputable that temporary injunction is granted during the pendency of the proceeding so that while granting final relief the court is not faced
with a situation that the relief becomes infructuous or that during the pendency of the proceeding an unfair advantage is not taken by the party in
default or against whom temporary injunction is sought. But power to grant temporary injunction was conferred in aid or as auxiliary to the final relief
that may be granted. If the final relief cannot be granted in terms as prayed for, temporary relief in the same terms can hardly if ever be granted. In
State of Orissa v. Madan Gopal Rungta [AIR 1952 SC 12 : 1952 SCR 28 : 1951 SCJ 764] a Constitution Bench of this Court clearly spelt out the
contours within which interim relief can be granted. The Court said that 'an interim relief can be granted only in aid of, and as ancillary to, the main
relief which may be available to the party on final determination of his rights in a suit or proceeding'. If this be the purpose to achieve which
  power to grant temporary relief is conferred, it is inconceivable that where the final relief cannot be granted in the terms sought for because the
statute bars granting such a relief ipso facto the temporary relief of the same nature cannot be granted. To illustrate this point, let us take the relief
which the Bank seeks in its suit. The prayer is that the Corporation be restrained by an injunction of the court from presenting a winding-up petition
under the Companies Act, 1956 or under the Banking Regulation Act, 1949. In other words, the Bank seeks to restrain the Corporation by an
injunction of the court from instituting a proceeding for winding up of the Bank. There is a clear bar in Section 41(b) against granting this relief. The
court has no jurisdiction to grant a perpetual injunction restraining a person from instituting a proceeding in a court not subordinate to it, as a relief, ipso
facto temporary relief cannot be granted in the same terms The interim relief can obviously be not granted also because the object behind granting
interim relief is to maintain status quo ante so that the final relief can be appropriately moulded without the party's position being altered during the
pendency of the proceedings.
25. We have carefully considered the arguments addressed by the learned Senior Counsels appearing for   the rival parties and also perused the
entire material available on record.
26. The question that arises for consideration in this appeal is:
Whether, in the absence of the Board Resolution, can a Chief Financial Officer or any other Principal Officer of a Private Limited Company institute
a suit/appeal or any other legal proceedings on behalf of the Company against its shareholders on the strength of Order XXIX Rule 1 of the Code of
Civil Procedure, 1908?
27. Learned Senior Counsel Sri. Amit Sibal appearing on behalf of the appellant has strongly relied upon Order XXIX Rule 1 of CPC in support of his
argument that the present appeal filed by the Chief Financial Officer of the appellant Company is maintainable and he has also contended that the
defect, if any, in instituting the suit or filing the appeal   is a curable defect. Order XXIX Rule 1 CPC reads as follows:
1. Subscription and verification of pleading.- In suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation
by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case.
28. On the reading of said provision of law, it is very clear that Order XXIX Rule 1 CPC only defines the person who is authorised to sign or verify
the pleadings on behalf of the Company and it does not authorise any person mentioned therein to institute suits or appeals on behalf of the Company.
The said provision of law comes into operation only after proceedings have been validly commenced and itself does not authorise a person to institute
suits or any other legal proceedings. Defect in filing of a suit or appeal would go to the very root of the matter.
29. It is true that a suit cannot be thrown out at the inception or a party cannot be non-sued on the ground of technicalities but while considering an
application for interim orders or interim injunctions, the court must prima facie satisfy itself that ""a triable case"" is prima facie made out by the party
approaching the court. Each case has to be considered on the facts of the said case and merely for the reason that a suit cannot be thrown away at
the inception level on the ground of technicalities, it does not give a right to a party to seek any interim orders or interim injunctions in such suits unless
the party prima facie satisfies with regard to the maintainability of the suit. When the question of maintainability of a suit or any other legal
proceedings is raised, which would go to the root of the matter, the same requires to be considered by the court for its prima facie satisfaction before
proceeding further in the matter.
30. Section 291 of the Companies Act, 1956 reads as follows:
291. GENERAL POWERS OF BOARD.-
(1) Subject to the provisions of this Act, the Board of directors of a company shall be entitled to exercise all such powers, and to do all such acts and
things, as the company is authorised to exercise and do :
Provided that the Board shall not exercise any power or do any act or thing which is directed or required, whether by this or any other Act or by the
memorandum or articles of the company or otherwise, to be exercised or done by the company in general meeting :
Provided further that in exercising any such power or doing any such act or thing, the Board shall be subject to the provisions contained in that behalf
in this or any other Act, or in the memorandum or articles of the company, or in any regulations not inconsistent therewith and duly made thereunder,
including regulations made by the company in general meeting.
(2) No regulation made by the company in general meeting shall invalidate any prior act of the Board which would have been valid if that regulation
had not been made.
31. A Company duly incorporated and registered is a distinct and independent legal person and its assets are separate from its members, it can sue
and be sued in its own name. The Company being a juristic person needs somebody to act on its behalf and manage the affairs of the Company. A
reading of Section 291 of the   Companies Act makes it clear that the Board of Directors have been given all the powers of the Company except
those which are required to be exercised in the General Meeting of the Company.
32. The learned counsel for the appellant has relied upon the judgment of High Court of Delhi in Seritec Electronics Pvt.Ltd.'s case (supra) and in the
said case, a reference has been made to the case of Mahanagar Telephone Nigam Limited -vs- Smt.Suman Sharma (2011(I) AD Delhi 331) which
interalia refers to the decision of the Hon'ble Apex Court in the case of United Bank of India -vs-Naresh Kumar and others ((1996) 6 SCC 660),
wherein it is held that on technical grounds, suit shall not be dismissed. In para-5 of Mahanagar Telephone Nigam Limited's case (supra), it is
observed as follows:
5. Reference may also be made usefully to the judgment of the Supreme Court in the United Bank of India -vs- Naresh Kumar and others (1996) 6
SCC 660, in which, in para 13, it is said that there is a presumption of valid institution of a suit once the same is prosecuted for a number of years. This
test as laid down by the Supreme Court is also satisfied in the present case   inasmuch as the suit in fact has been prosecuted for about two years
by the appellant corporation for seeking an appropriate decree against the respondent by adducing evidence.
I may note that the appellant is a public sector undertaking and not a private company where there would be disputes between two sets of
shareholders claiming right to management and one set of shareholders are opposing another set of shareholders with respect to control and
management of the company. This thus is an additional fact that there can be no dispute as to the authority of the person signing/verifying the
pleadings and instituting the suit.
33. Therefore, it is very clear that in the case of Mahanagar Telephone Nigam (supra), a distinction has been made with regard to a public undertaking
company and a private limited company. The court has observed that in a private company, there could be dispute between two sets of shareholders
claiming right to management and one set of shareholders opposing another set of shareholders with respect to control and management of the
Company and in such an event, there can be a dispute as to the authority of a person signing/verifying in instituting the same. In the present case, the
dispute is admittedly interse between the two   branches of a family, who are equal shareholders of the Company and the respondent Nos.2 and 3
being 50% shareholders of appellant Company have questioned the authority of the Chief Financial Officer of the Company to file the appeal in the
absence of a Board Resolution duly authorising him.
34. In the case of Al-Amin Seatrans Ltd. -vs- Owners and Party interested in Vessel M.V.9it has been observed in paragraphs-23, 33, 50 and 53 as
follows:
23. It is well-settled, that under Section 291 of the Companies Act except where express provision is made that the powers of a company in respect
of a particular matter are to be exercised by the company in general meeting in all other cases the Board of Directors are entitled to exercise all its
powers.
Individual directors have such powers only as are vested in them by the Memorandum and Articles. It is true that ordinarily the Court will not unsuit a
person on account of technicalities. However, the question of AIR 1995 CALCUTTA 169 Â Â authority to institute a suit on behalf of a company is
not a technical matter. It has far- reaching effects. It often affects policy and finances of the company. Thus, unless a power to institute a suit is
specifically conferred on a particular director, he has no authority to institute a suit on behalf of the company. Needless to say that such a power can
be conferred by the Board of Directors only by passing a resolution in that regard. ......
33. In the instant case it is quite clear that there were talks and consultations between the Managing Director and the Chairman which are reflected,
inter alia, by the agreement between the Managing Director and the Chairman dated 12-9-91. The said agreement provided that money given as loan
by the Managing Director of the plaintiff to any companies except Loyal Shipping Pvt. Ltd. would be recovered by Managing Director within 3
months time. So there was not only consultation between them, but there was an agreement that money due from Loyal Shipping Pvt. Ltd. would not
be recovered. It has not also not been alleged anywhere that   there was any further or other consultation. The Managing Director knew
sufficiently well that he could not get any resolution passed by the Board of Directors giving him power to institute a suit against the Loyal Shipping
Pvt. Ltd. After all the Managing Director as also the Chairman of the two companies are common. It is also quite clear that no attempt was made by
the Managing Director to get any specific authority to institute the suit by or in the name of the plaintiff company against Loyal Shipping Pvt. Ltd. or
its vessel. The Managing Director also knew very well that he could not even get a resolution or authority in his favour even in a general meeting
because he could not get any resolution passed due to the equal division in two groups and the casting vote which the Chairman could exercise. In my
opinion, the right of management of the company's affairs was vested in the Board of Directors and the Managing Director could only act subject to
the control and supervision of the Board of Directors. There was no specific authority granted to the Managing Director either to institute any suit or
to appoint any Constituted Attorney of the plaintiff company. In my opinion, the Managing Director did not have   any power or authority in the
facts and circumstances of this case to institute any suit on behalf of the plaintiff or to appoint any Constituted Attorney of the Company without prior
approval of the Board of Directors. ......
50. In my opinion, there are serious disputes and difference as between the Board of Directors of the plaintiff. All the four directors of plaintiff are
directors or Loyal Shipping Pvt. Ltd. which has only one more director. The Chairman and the Managing Director of plaintiff and the Loyal Shipping
Pvt. Ltd. which has only one more director. The Chairman and the Managing Director of plaintiff and the Loyal Shipping Pvt. Ltd. are same. There
was an agreement between the Chairman and the Managing Director plaintiff in 1991 that the dues from Local Shipping Pvt. Ltd. were not to be
realised. In any event, the disputes have been going on since 1991 and no subsequent accounts have been disclosed since after the accounting year
1991. ......
53. I, therefore, hold that the suit has been instituted at the instance of the Managing Director alone without any specific power or authority in him to
institute the suit and the Managing Director had no power either to institute the suit by himself or through his agent or to appoint any Constituted
Attorney for the said purpose. The suit has been instituted without due and proper authority and the suit is, therefore, liable to be dismissed on that
ground alone and all interim orders are liable to be vacated. I also hold that in any event the order dated 7th July, 1994 for arrest of the said vessel,
namely Loyal Bird was obtained by suppression of material facts and/or by making false and incorrect allegations as to the material facts and the said
order dated 7th July, 1994 is in any event liable to be vacated. The petitioner, in my opinion, is entitled to an order for release of the said vessel without
security.
35. In the case of M/s.Schmenger GMBH and Company Leder -vs- M/s.Saddler Shoes Pvt.L.t din Civil Suit No.689/1999 decided on 29.10.2010, the
  High Court of Judicature at Madras at paras-20 and 21, it has been observed as follows:
20. The abovesaid decision reported in 1996(60 SCC 660 = 1997(90) Comp. Cases 329 = AIR 1997 SC 3 (United Bank of India- vs- Naresh Kumar)
(cited supra), has been referred to by the High Court of Himachal Pradesh in the decision reported in 2004 (118) Comp. Cases 328 (Apple Valley
Resort Vs. H.P.State Elec.Board), in which it was observed by the High Court of Himachal Pradesh that Order 29, Rule 1 of CPC only authorises the
persons mentioned there into sign and verify the pleadings on behalf of a Corporation/Company and it does not authorise such persons to institute an
action on behalf of a Corporation/Company; the question of authority to institute an action on behalf of a Company is not a technical matter; it has far-
reaching effects and it often affects policy and finances of the Company; therefore, unless a power to institute an action is specifically conferred on a
particular Director, he would have no authority to bring an action on behalf of the Company; the power to institute an action on behalf of the Company
can be conferred on a Director or any other Officer of the Company only by the Board of Directors by way of a Resolution in that regard; in the
absence of a specific provision of the Board of Directors authorising the Liaison Officer to institute the petition (suit) for and on behalf of the
Company or power conferred on the Director by the Memorandum and Articles of Association, the petition (suit) cannot be said to have been laid by
a duly authorised and competent person for and on behalf of the Company; the High Court of   Himachal Pradesh further held that the suit was
bad and liable to be dismissed on that ground alone.
21. Since the plaintiff neither filed the Memorandum/Articles of Association, nor the Resolution of the Board of Directors of the Company, authorising
the Liaison Officer namely the person to verify the plaint and institute the suit. Hence, as per the decisions cited above, I am of the view that the suit
itself is not maintainable.
36. In the case of Naresh Kumar (supra) the Hon'ble Supreme Court in para-10 has observed as follows:
10. It cannot be disputed that a company like the appellant can sue and be sued in its own name. Under Order 6 Rule 14 of the Code of Civil
Procedure a pleading is required to be signed by the party and its pleader, if any. As a company is a juristic entity it is obvious that some person has to
sign the pleadings on behalf of the company. Order 29 Rule 1 of the Code of Civil Procedure, therefore, provides that in a suit by or against a
corporation the Secretary or any Director or other Principal Officer of the corporation who is able to depose to the facts of the case might sign and
verify on behalf of the company. Reading Order 6 Rule 14 together with Order 29 Rule 1 of the Code of Civil Procedure it would appear that even in
the absence of any formal letter of authority or power of attorney having been executed a person referred to in Rule 1 of Order 29 Â Â can, by virtue
of the office which he holds, sign and verify the pleadings on behalf of the corporation. In addition thereto and dehors Order 29 Rule 1 of the Code of
Civil Procedure, as a complaint is a juristic entity, it can duly authorise any person to sign the plaint or the written statement on its behalf and this
would be regarded as sufficient compliance with the provisions of Order 6 Rule 14 of the Code of Civil Procedure. A person may be expressly
authorised to sign the pleadings on behalf of the company, for example by the Board of Directors passing a resolution to that effect or by a power of
attorney being executed in favour of any individual. In absence thereof and in cases where pleadings have been signed by one of its officers a
corporation can ratify the said action of its officer in signing the pleadings. Such ratification can be express or implied. The court can, on the basis of
the evidence on record, and after taking all the circumstances of the case, specially with regard to the conduct of the trial, come to the conclusion that
the corporation had ratified the act of signing of the pleading by its officer.
37. The Hon'ble Supreme Court in Naresh Kumar's case (supra) has therefore stated that a suit filed on the strength of Order XXIX Rule 1 of CPC
needs ratification which could be either express or implied.
38. Even in the case of Alcon Electronics Pvt.Ltd. (supra), it has been held that the defect, if   any, in not passing any specific resolution
authorizing the Director to file a suit on behalf of the Company against the defendant is a curable defect, which means such action needs to be
ratified.
39. In the present case, the dispute is interse between the two branches of a family holding equal shareholdings in the Company. Though the defect in
filing the suit or an appeal in the absence of a Board Resolution by a Company is a curable defect, which can be cured by a express or implied
ratification by a Board Resolution, such an eventuality is completely ruled out in the present case having regard to the fact that the present case has
been initiated by the Company by its Chief Financial Officer against 50% shareholders of the Company. Therefore, since the possibilities of a
ratification being not there, the defect in instituting the suit or appeal for want of Board Resolution of the Company cannot be said to be a curable
defect in the present case.
40. The judgments relied upon by the learned counsel for the appellants are either in the cases of a Public Sector Undertaking Company or in respect
of a Private Company instituting a suit against a third party where the defect in instituting the suit/appeal for want of Board Resolution could be cured
by ratification. But the said principle cannot be made applicable to the facts of the present case, as admittedly the dispute in the present case is interse
between the two branches of a family, who hold equal shareholdings in the Company.
41. In none of the judgments relied upon by the appellant, it has been held that without there being a ratification by the Company, solely on the basis of
Order XXIX Rule 1 of CPC, a suit can be instituted by a Director or any other principal officer of the Company. Legal proceedings initiated to protect
the interest of the Company against third party and a proceedings initiated on behalf of the Company against its own shareholders stand on altogether
different footings.
42. In the case of Nibro Limited (supra), the suit was instituted by a Director of the Company without the Board Resolution of the Company
authorizing him to institute the suit. Even after the suit was instituted, no resolution was passed by the Company ratifying the action. Though a plea
was taken that on the strength of Order XXIX Rule 1 of CPC, a suit could be maintained by the Director of the Company even in the absence of a
Board Resolution, it was held that Order XXIX Rule 1 of CPC does not authorize persons mentioned therein to institute suit on behalf of the
Corporation but only authorizes them to sign and verify the pleadings on behalf of the Corporation and unless a power to institute the suit is specifically
conferred on a particular Director, by a resolution to the said effect, he has no authority to institute a suit on behalf of the Company. The judgment in
Nibro Limited's case has been confirmed by the Hon'ble Apex Court in the case of State Bank of Travancore (supra) and therefore, it can be safely
held that a suit or any other legal proceedings can be instituted by a   Director or Officer of the Company only on the strength of Board Resolution
by the Company to the said effect and in the absence of such a Board Resolution, if a suit or legal proceedings is instituted, then necessarily there has
to be a resolution by the Company ratifying the defect, failing which the suit or legal proceedings cannot be maintained. Therefore, the question
framed for consideration in this appeal is answered negatively.
43. In the case of Kashi Math Samsthan -vs- Srimad Sudhindra Thirtha Samsthan10, the Hon'ble Supreme Court in para-13 has observed as follows:
13. It is well settled that in order to obtain an order of injunction, the party who seeks for grant of such injunction has to prove that he has made out a
prima facie case to go for trial, the balance of convenience is also in his favour and he will suffer irreparable loss and injury if injunction is not granted.
But it is equally well settled that when a party fails to prove prima facie case to go for trial, question of considering the balance of convenience or
irreparable loss and injury to the party concerned AIR 2010 SC 296 Â Â would not be material at all, that is to say, if that party fails to prove prima
facie case to go for trial, it is not open to the Court to grant injunction in his favour even if, he has made out a case of balance of convenience being in
his favour and would suffer irreparable loss and injury if no injunction order is granted. . . . . .
44. In the present case, it is not in dispute that the Company has not authorized the Chief Financial Officer by passing a Board Resolution to institute
the suit or appeal on behalf of the Company. In a suit or appeal, ""a prima facie case"" would depend upon the facts of the said case and in the present
appeal having regard to the undisputed facts of the case, wherein equal shareholders of the Company have been fighting against each other, in the
absence of a Board Resolution, the suit or appeal instituted by the Chief Financial Officer of the Company is definitely defective and therefore, there
is no prima facie case made out for a trial in the suit and in the absence of the party making out a case for trial, the prayer made by the said   party
for grant of interim orders/interim injunctions in such a suit cannot be favoured.
45. The trial court has considered all these aspects of the matter and has rightly rejected the applications I.A.Nos.1 to 3 filed in the suit and while
disposing of the applications, the Trial Court has observed that the suit itself was defective and not maintainable. The said order does not suffer from
any illegality or perversity, which calls for interference by this court.
46. The Hon'ble Supreme Court in the case of Skyline Education Institute (India) Pvt.Ltd. -vs-S.L.Vaswani and Anothe2r 010 AIR SCW 628 has held
that, in the absence of an error apparent or perversity, the order passed by the court of first instance exercising its discre(cid:24)on to grant or refuse to grant relief of
temporary injunction should not be interfered with.
47. Under the circumstances, we do not find any grounds to interfere with the order passed by the Trial Court.
Accordingly, the Commercial Appeal stands dismissed.
In view of the disposal of the appeal, the pending applications i.e., I.A.Nos.1/2021 to 5/2021 do not require consideration and accordingly, they stand
disposed of.
