This appeal has arisen out of an application, under section 20 of the Arbitration Act, 1940, made by the appellants, M/s. National Construction Ltd., against the respondent, Aiwan-i-Iqbal Authority, Lahore. The appellants had agreed to construct a building complex known as 'Aiwan-i-lqbal' for the respondent. At the time of entering into contract in this regard, performance and mobilization bond was executed by Habib Bank Ltd., in favour of the respondent. Amount of bond, when executed, was Rs.1,15,00,000. By the time of making the said application the bond had been encashed by the appellants to the extent of Rs.64,09,000. According to the appellants, there are running bills of the amount of Rs.1,37,03,000 apart from other claims. The respondent desired the encashment of the said bond for its own benefit whereupon the appellants went before a Civil Judge with the aforesaid application.
2. Alongwith the said application, the appellants made another petition, under section 41 of the said Act, praying for a stay order restraining the respondent from getting the above bond encashed.
The stay order was refused by the learned Civil Judge who was seized of the matter. The main ground on which the stay order was withheld by him was that an irreparable injury was not likely to be caused to the ' appellants in the absence of the temporary injunction. Order of the learned Civil Judge dismissing the temporary injunction has been challenged in the instant appeal.
3. It was contended by learned counsel for the appellants that the learned Civil Judge had declined to grant temporary injunction in view of the provisions of clause (i) of section 56 of the Specific Relief Act, 1877, although the said Act was not applicable to the proceedings before him. According to clause (i) no injunction can be issued when equally efficacious relief can certainly be obtained by any other usual mode of proceedings except in case of breach of trust. It was maintained by learned counsel for the appellants that the appellants' case fell under item 2 of Second Schedule to the Arbitration Act, which empowers a Civil Court to secure the amount in difference in the reference. It was, therefore, urged by learned counsel for the appellants that the learned Civil Judge ought to have issued temporary injunction to secure the payment of amount due to the appellants. It was also maintained by learned counsel for the appellants that the respondent had not filed any affidavit refuting what the appellants had stated in the affidavit put in by them.
4. In reply, it was submitted by learned counsel for the respondent that there was no arbitration agreement between the parties in relation to the bond in question and, therefore, the matter relating to the said bond could not be made subject-matter of the arbitration proceedings.
Another point canvassed by him was that certain steps which were required to be taken before having recourse to the arbitration proceedings were not resorted to by the appellants, nor any dispute between the parties was spelt out in the application under section 20 of the Arbitration Act.
Learned counsel for the respondent also referred me to ground (a) of the grounds appearing in the memorandum of appeal in which it has been stated that "the contract has been concluded by the mutual consent of the parties on the basis of as is where it is". Additionally, it was pleaded by learned counsel for the respondent that the respondent has unfettered right to have the bond in question encashed without reference to any one. According to him, it was the Habib Bank Ltd.
Which could raise objection against encashment of the bond by the respondent, if any, but the Bank had not done so nor the Bank was impleaded as a party to the proceedings initiated by the appellants.
5. 1 would not like to express any opinion on all the arguments raised by learned counsel for the appellants because the main case is still pending before the learned trial Court. Presently, I am concerned with the matter relating to temporary injunction only and would, therefore, examine those arguments alone which have bearing on the stay matter.
6. Provisions governing temporary injunction are contained in Rules 1 and 2 of Order XXXIX of the Code of Civil Procedure and it was in view of these provisions and not in the light of the provision of clause (i) of section 56 of the Specific Relief Act that matter relating to stay order was decided by the learned Civil Judge. In their petition for temporary injunction also, the appellants had cited Rules 1 and 2 of Order XXYdX of the Code of Civil Procedure besides section 41 of the Arbitration Act.
It would, therefore, follow that while adjudicating upon the question of tempoary injunction the learned Civil Judge sought guidance from the provisions of Rules 1 and 2 of Order XXXIX of the Code of Civil Procedure and not from those of clause (i) of section 56 of the Specific Relief Act. In this view of the matter, I do not agree with learned counsel for the appellants that the stay matter was disposed of under the said provisions of the Specific Relief Act which were not attracted to the instant case.
7. It is settled law that temporary injunction cannot be issued under Rules I and 2 of Order XXXIX of the Code of Civil Procedure unless the party seeking such injunction has a prima facie case, the balance of convenience is in favour of such party and he is likely to suffer irreparable injury if the injunction is withheld. Even if the appellants have a prima facie case in the sense of an arguable case and the balance of convenience also tilts in their favour, they are not likely to suffer irreparable injury inasmuch as the amount to which the dispute relates is easily ascertainable. In fact, it is a money matter. If the appellants are not found entitled to the amount in dispute but it is withdrawn by the respondent, the appellants will be able to recover it from the respondent in the event of their ultimate success in the litigation. It is therefore, evident that the appellants are not likely to suffer irreparable injury in the absence of temporary injunction.
8. Since one of the three conditions for grant of temporary injunction, namely, likelihood of sustaining irreparable injury is not satisfied in the present case, the appellants were not entitled to the said interim relief. In the circumstances, no interference with the order of the learned Civil Judge, by which the temporary injunction was refused, is called or. This appeal is accordingly, dismissed, with no order as to costs.