A) ABSTRACT / HEADNOTE

The case Tushar Himatlal Jani v. Jasbir Singh Vijan & Ors., Civil Appeal No. 6636 of 2025, decided on 13 May 2025 by the Supreme Court of India, pertains to the restoration of an interim injunction granted in favour of Respondent No.1 during the pendency of a tenancy-related dispute before the Small Causes Court, Mumbai. The Supreme Court had to determine whether the Bombay High Court was justified in restoring interim protection that restrained the Appellant from dispossessing the Respondent or creating third-party interests over 550 square feet of disputed premises within a property measuring 22,000 square feet.

The Court examined the settled principles of granting interim injunctions—prima facie case, balance of convenience, and irreparable injury. The Court held that Respondent No.1 failed to establish a prima facie case as his tenancy rights were still pending adjudication before the Small Causes Court. The balance of convenience favoured the Appellant, as the injunction was paralyzing a large-scale redevelopment project for a negligible portion of land. Further, irreparable injury was found to be caused to the Appellant, since contractual obligations and redevelopment rights were indefinitely stalled. The Court emphasized that Respondent No.1’s claims required full trial scrutiny and could not be pre-emptively protected through interim orders.

The Supreme Court set aside the High Court’s order, but in the interest of equity, directed the Appellant to reserve one unit of 550 square feet in the redeveloped property until the tenancy suit was conclusively adjudicated. The judgment underscores judicial restraint in interfering with redevelopment projects through interim orders where tenancy rights are disputed, and reinforces the principle that injunctions must balance equities without unduly prejudicing legitimate proprietary rights.

Keywords: Interim injunction; tenancy rights; redevelopment project; balance of convenience; prima facie case; irreparable injury; Small Causes Court; family settlement agreement; impleadment; lease and license agreement.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The judgment emanates from a long-standing tenancy dispute concerning land measuring 22,000 square feet situated at Chembur, Mumbai. The Appellant, absolute owner of the land, had leased out 11,250 square feet in 1972 to a partnership firm M/s Silver Chem (India), controlled by the Vijan family. Upon the demise of the Appellant’s father, ownership devolved on the Appellant, who sought eviction of the tenants in 2008 by instituting proceedings before the Small Causes Court.

A significant twist arose when Respondent No.1, claiming to be a legal heir and partner in the firm, asserted tenancy rights over 550 square feet on the basis of a Family Settlement Agreement of 2021. This agreement allegedly allocated him a portion of the disputed land. Following this, Respondent No.1 attempted impleadment in eviction proceedings and also independently filed a declaration suit claiming tenancy rights.

Meanwhile, the original tenants surrendered their tenancy rights in 2022, leading the Appellant to withdraw his eviction suit in 2023. Thereafter, the Appellant entered into a leave and license agreement with M/s KMG Global for 2,200 square feet, initiating redevelopment plans. Respondent No.1 simultaneously sought interim injunction before the Small Causes Court, restraining dispossession from his alleged 550 square feet area. While the Small Causes Court initially granted protection, the Appellate Court reversed it. However, the Bombay High Court restored the injunction in July 2024.

The Supreme Court, therefore, was called upon to determine whether the High Court’s restoration of interim injunction was legally sustainable. The decision required balancing competing interests—the proprietary rights of the landowner seeking redevelopment against the disputed tenancy rights of an alleged partner asserting possession over a small portion of land.

D) FACTS OF THE CASE

The Appellant’s father owned 22,000 square feet land in Chembur, Mumbai. In 1972, 11,250 square feet was leased to M/s Silver Chem (India), a partnership of the Vijan family. Upon his father’s death, the property devolved upon the Appellant, who terminated the lease in February 2008 and filed Eviction Suit No.119/148 of 2008 before the Small Causes Court.

Respondent No.1, asserting himself as heir of one of the partners of the tenant firm, sought impleadment in the eviction suit, claiming partnership rights under a Memorandum of Understanding and also instituting a separate partition suit for 1/6th share in family properties. His impleadment was initially allowed but later set aside in revision in 2019.

A Family Settlement Agreement dated 9 June 2021 was executed among Vijan family members, mediated under Supreme Court’s directions in parallel disputes. It purportedly recognized Respondent No.1’s entitlement to 550 square feet within the subject premises. On this basis, he claimed undivided share and possession rights. Subsequently, Respondent No.2 and its partners executed a Leave and License Agreement with M/s KMG Global in October 2021, allegedly without the Appellant’s consent. They later surrendered tenancy rights in October 2022, leading the Appellant to withdraw the eviction suit in January 2023.

Respondent No.1, however, filed R.A.D. Suit No. 519/2023 before the Small Causes Court, seeking a declaration of tenancy rights over 550 square feet and challenging the surrender of tenancy as illegal. He sought interim injunction against dispossession. The Small Causes Court granted protection in April 2023 and confirmed it in May 2023. On appeal, this was reversed in December 2023.

Aggrieved, Respondent No.1 moved Writ Petition No.763 of 2024 before the Bombay High Court, which restored the injunction in July 2024. The Appellant, facing halted redevelopment of the property and mounting financial losses, approached the Supreme Court.

E) LEGAL ISSUES RAISED

i. Whether the High Court was justified in restoring the interim injunction in favour of Respondent No.1 during the pendency of tenancy adjudication before the Small Causes Court?

ii. Whether Respondent No.1 established a prima facie case for interim protection based on the Family Settlement Agreement?

iii. Whether the balance of convenience lay in favour of Respondent No.1 or the Appellant in the context of redevelopment?

iv. Whether Respondent No.1 would suffer irreparable harm without injunction, or whether greater irreparable injury would be caused to the Appellant by its continuation?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for the Appellant submitted that the High Court’s order effectively crippled redevelopment projects, despite the disputed area being a mere 550 square feet within a 22,000 square feet property. They contended that Respondent No.1 lacked locus standi as he was neither a recognized tenant nor in lawful possession. The tenancy rights stood unequivocally surrendered by the original tenants in 2022, conferring clear title and possession rights on the Appellant.

It was argued that Respondent No.1’s reliance on the Family Settlement Agreement could not supersede the statutory requirements of tenancy law under the Maharashtra Rent Control Act, 1999. The Appellant stressed that Respondent No.1’s claims were at best contractual family arrangements requiring trial scrutiny, but insufficient for interim protection.

The Appellant further emphasized the three-fold test for injunctions under Order XXXIX Rules 1 & 2 CPC. He contended that no prima facie case existed, balance of convenience lay heavily in favour of redevelopment, and irreparable injury was suffered by him due to contractual breaches with licensees and financial losses, which damages could not adequately compensate. Reliance was placed on Dalpat Kumar v. Prahlad Singh, (1992) 1 SCC 719 and Seema Arshad Zaheer v. Municipal Corporation of Greater Mumbai, (2006) 5 SCC 282, which held that injunctions must not be granted where plaintiffs fail to show strong prima facie rights.

G) RESPONDENT’S ARGUMENTS

The counsels for Respondent No.1 contended that the injunction was a simple restraint against dispossession without due process of law, in line with constitutional guarantees under Article 300A. They asserted that Respondent No.1 derived rights from the Family Settlement Agreement mediated under Supreme Court’s orders, which recognized his 550 square feet entitlement.

It was argued that withdrawal of the eviction suit against Respondent No.2 indicated Appellant’s acquiescence to tenancy claims. Respondent No.1’s possession was not illegal, and any unilateral dispossession would violate settled law in K.K. Dewan v. District Judge, (1993) 3 SCC 63, where possession even without perfected ownership was protected.

The Respondent further alleged that the surrender of tenancy relied upon by the Appellant was forged, as it lacked signatures of all partners and omitted consideration. They argued that the High Court rightly restored status quo since the injunction had been in force for over 20 months and removal would cause irreparable injury to Respondent No.1. They relied upon Dorab Cawasji Warden v. Coomi Sorab Warden, (1990) 2 SCC 117, which underscored protecting possession until lawful adjudication.

H) RELATED LEGAL PROVISIONS

i. Code of Civil Procedure, 1908 – Order XXXIX Rules 1 & 2 (Grant of Temporary Injunctions).
ii. Indian Contract Act, 1872 – Principles of valid agreements and enforceability of family settlements.
iii. Transfer of Property Act, 1882 – Distinction between lease and license; rights of tenants and licensees.
iv. Maharashtra Rent Control Act, 1999 – Regulation of tenancy and eviction proceedings.
v. Article 300A, Constitution of India – Protection of property from deprivation without authority of law.
vi. International reference: European Convention on Human Rights, Protocol 1, Article 1 – Peaceful enjoyment of possessions, influencing Indian jurisprudence on possession rights.

I) JUDGEMENT

The Supreme Court clarified that the tenancy dispute was pending before the Small Causes Court and declined to pre-judge the merits. The Court reiterated the three-pronged test for interim injunctions.

The Court found that Respondent No.1 failed to establish a prima facie case, since his alleged tenancy rights required full trial scrutiny. The Family Settlement Agreement could not, at an interim stage, conclusively confer tenancy status.

On balance of convenience, the Court noted that Respondent No.1 claimed only 550 square feet, whereas the Appellant’s redevelopment rights over 22,000 square feet were paralyzed. The injunction had stalled contractual obligations with M/s KMG Global for 2,200 square feet, causing disproportionate hardship.

The Court also held that irreparable injury lay against the Appellant, as financial losses and contractual defaults could not be remedied by damages later. Conversely, Respondent No.1’s alleged tenancy rights could be safeguarded by equitable directions.

Accordingly, the appeal was allowed, and the High Court’s order was set aside. However, to balance equities, the Court directed that one 550 square feet unit be reserved in redevelopment to protect Respondent No.1’s claims, should the Small Causes Court rule in his favour.

a. RATIO DECIDENDI

The ratio decidendi is that interim injunctions cannot be granted where the claimant fails to establish a prima facie case, balance of convenience, and irreparable harm. In tenancy disputes pending trial, mere assertions under a family settlement cannot justify injunctions that disproportionately stall redevelopment projects and prejudice proprietary rights of lawful owners. The decision emphasized judicial restraint in granting injunctions that paralyze economic development.

b. OBITER DICTA

The Court observed that admissions made during settlement negotiations cannot be construed as binding legal admissions. It also noted that while family settlements mediated under court orders hold sanctity, their effect on tenancy rights must be tested in proper proceedings and not presumed in interim stages. These remarks serve as guidance for future tenancy disputes involving family arrangements.

c. GUIDELINES

The Court reaffirmed guidelines for grant of interim injunctions:

i. Courts must strictly apply the prima facie case, balance of convenience, and irreparable injury test cumulatively.
ii. Mere assertions of rights, without lawful recognition, cannot establish prima facie case.
iii. Injunctions must not disproportionately prejudice lawful proprietors’ rights, especially in redevelopment projects.
iv. Courts must ensure injunctions are equitable and avoid paralysing contractual obligations.
v. Equities may be balanced by protective directions (e.g., reserving property portion) instead of blanket injunctions.

J) CONCLUSION & COMMENTS

The judgment exemplifies a balanced judicial approach to property and tenancy disputes intersecting with redevelopment. It clarifies that injunctions cannot be instruments to stall legitimate redevelopment, particularly where claimants fail to substantiate lawful tenancy rights. At the same time, the Court protected Respondent No.1’s interests by directing reservation of equivalent space, thereby balancing equities.

The decision is significant in urban property disputes in India, where redevelopment projects often clash with tenancy claims. By reiterating the strict standard for injunctions, the Court prevented misuse of interim relief to delay large-scale projects. At the same time, its equitable directions prevent injustice to potential claimants pending trial.

This judgment strengthens jurisprudence laid down in Dalpat Kumar v. Prahlad Singh and Seema Arshad Zaheer, while tailoring it to contemporary redevelopment contexts. It ensures courts safeguard legitimate property rights without disregarding possible tenancy claims, thereby striking a fine balance between economic progress and social justice.

K) REFERENCES

Important Cases Referred

i. Dalpat Kumar v. Prahlad Singh, (1992) 1 SCC 719.
ii. Seema Arshad Zaheer v. Municipal Corporation of Greater Mumbai, (2006) 5 SCC 282.
iii. Dorab Cawasji Warden v. Coomi Sorab Warden, (1990) 2 SCC 117.
iv. K.K. Dewan v. District Judge, (1993) 3 SCC 63.

Important Statutes Referred

i. Code of Civil Procedure, 1908 – Order XXXIX Rules 1 & 2.
ii. Indian Contract Act, 1872.
iii. Transfer of Property Act, 1882.
iv. Maharashtra Rent Control Act, 1999.
v. Constitution of India, Article 300A.
vi. European Convention on Human Rights, Protocol 1, Article 1.