Failure to Consider Allegations of Fraud and Material Title Disputes Vitiates Temporary Injunction Order

The Appellants (Defendant Nos. 1 and 2), owners of the subject property, had initially entered into an agreement for sale and executed a power of attorney in favor of Respondent Nos. 2 and 3 (Defendant Nos. 3 and 4).

These documents were subsequently cancelled due to alleged ill conduct.

However, prior to cancellation, Respondent Nos. 2 and 3 purportedly executed a secondary agreement for sale in favor of Respondent No. 1 (Plaintiff) on the strength of the then-subsisting power of attorney.

Respondent No. 1 filed a suit for specific performance and obtained an order of temporary injunction from the Trial Judge.

The Appellants challenged this, alleging fraud, collusion, and non-receipt of consideration, asserting the Trial Judge ignored these contentions.

1. Whether the Trial Court’s order of temporary injunction was legally sustainable given the failure to address allegations of fraud and collusion raised in the written objection.

2. Whether a prima facie case for injunction was established through a reasoned order.

The Court applied the three cardinal tests for the grant of a temporary injunction: prima facie case, balance of convenience, and irreparable loss or injury.

Under established civil procedure principles, a judicial order granting an injunction must be a "reasoned order" that specifically adverts to the disputes and evidence raised by both parties, rather than merely paying "lip-service" to legal doctrines.

The High Court observed that the Trial Judge failed to consider the serious allegations of fraud and collusion levelled by the Appellants in their written objection.

The Court noted that the impugned order reached a conclusion regarding a prima facie case without providing clear reasoning or addressing the Appellants’ claims that they never received consideration and that Respondent Nos. 1, 2, and 3 acted in concert.

The Bench determined that the failure to adjudicate upon the specific disputes raised by the parties rendered the order unsustainable, necessitating a remand for fresh consideration.

While the court did not rule on the merits of the fraud, it emphasized that a judicial mind must be applied to the specific facts of the dispute to satisfy the three cardinal tests.

The matter was remanded to the learned Civil Judge (Senior Division), Third Court at Howrah, for fresh adjudication by June 30, 2026, via a reasoned order.

To maintain status quo during the remand, the Court revived an interim injunction restraining the Appellants from alienating or transferring the property to third parties until the fresh disposal of the application.

All contentions on merits remain open for the Trial Court’s independent decision.