Delhi HC Sets Aside Order Letting Husband Take Disputed Machinery From Wife’s Premises Before Ownership Trial

The parties, who operated separate garment-related businesses, disputed ownership of premises registered in the Appellant/Wife’s name and machinery and goods stored there.

The Respondent/Husband claimed ownership of the premises and machinery; the Appellant disputed his claims, asserting that the machinery had been acquired with joint funds, including proceeds from her business.

In the Respondent’s suit, the Family Court restrained the Appellant from creating third-party interests in the premises and later directed that specified machinery and goods be released to the Respondent for use pending trial.

The Appellant appealed against the release-and-use directions.

1. Whether the Family Court could, at the interim stage, direct the release of disputed machinery and goods to the Respondent and permit their use before ownership was adjudicated.

2. Whether the Appellant’s Written Statement contained an unambiguous admission of the Respondent’s exclusive ownership of the machinery.

Under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908, interim relief should not ordinarily grant the substantive relief sought in the suit before trial, particularly where it would materially alter the existing position and affect disputed ownership rights.

Competing claims to ownership must be adjudicated on evidence; interim relief should not treat disputed ownership as conclusively established.

The Family Court inferred that the machinery belonged exclusively to the Respondent because it was associated with Kay Enterprises and the Appellant denied being involved in its import. The High Court held that these circumstances did not establish exclusive ownership, particularly given the Appellant’s specific claim that the machinery was acquired using joint funds.

Nor did the Written Statement contain an unambiguous admission of the Respondent’s ownership.

Because ownership of the machinery was distinct from ownership of the premises and both remained disputed, directing delivery and permitting use would grant substantive mandatory interim relief before trial.

The Appellant was restrained from selling, transferring, alienating or creating third-party interests in the disputed machinery during the suit. The Respondent may apply to the Family Court for directions concerning its safe custody, to be decided on the merits and without influence from the High Court’s observations.