Karnataka High Court Stays Ex-Parte Mandatory Ad-Interim Injunction order As it is Void Under Section 27 of Indian Contract Act, 1872

The Hon’ble High Court of Karnataka had stayed the blanket ex-parte injunction order passed by the Addl. City Civil and Sessions Judge, Bangalore restraining former employees from doing similar and identical business as that of their employer

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The Addl. City Civil and Sessions Judge, Bangalore, on 29.09.2022, granted an ex-parte ad-interim injunction restraining Trueblue Supply Chain Pvt. Ltd. and its directors from carrying out the business of carrying and forwarding agents in a suit filed by the former employer of Trueblue Supply Chain’s directors.

Being aggrieved by the order dated 29.09.2022, the directors of Trueblue Supply Chain approached the Hon’ble High Court of Karnataka seeking to quash the order of the Addl. City Civil Judge by invoking its supervisory jurisdiction. The Petitioners contended that there was no negative covenant in the appointment letter by the former employer that restrained them from doing any lawful business or employment post resignation or termination of services. During the course of arguments, it was argued that a blanket injunction order that led to shutting down of Petitioners’ business and profession is void under Section 27 of the Indian Contract Act, 1872 and violates the fundamental principles laid down in Article 19(1)(g) of the Indian Constitution.

The single-judge bench of the Karnataka High Court headed by Justice B. M. Shyam Prasad stayed the ad-interim injunction order for a period of 4 weeks and issued notice to the former employer, the Plaintiff in the suit instituted before the City Civil and Session Judge, Bangalore.

The Petitioners, Trueblue Supply Chain Pvt. Ltd. and its directors were represented by Senior Advocate Promod Nair for Khurana and Khurana Advocates and IP Attorneys led by Abhijeet Deshmukh, Arjun Santhosh and Deeksha Prakash.

Case Title: WP No. 22110/2022 (GM-CPC) Trueblue Supply Chain Pvt Ltd v. LCM Logistics Pvt Ltd.

Author: Arjun Santhosh, Senior Associate-Litigation, Khurana & Khurana Advocates and IP Attorneys. in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney.

Co-author: Deeksha Prakas. Associate , Khurana & Khurana Advocates and IP Attorneys.

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