When a court finds that its interim injunction has been wilfully breached, should punishment necessarily follow? Harsh Kashyap explores this in light of the Bombay High Court decision in KVIC v. Jaishukh N. Bhuta, explaining how the Court draws an important distinction between establishing disobedience and deciding its consequences, clarifying that Order XXXIX Rule 2A is primarily meant to secure compliance rather than punish past conduct. Harsh is a 3rd-year B.Sc. LLB student at NFSU Gandhinagar.
What Follows a Breach? Bombay High Court Separates Disobedience from its Consequences
By Harsh Kashyap
What should happen when a court finds that a party has disobeyed an interim order? Punish the party or ensure the order is followed from then on? The same question lies at the heart of the Bombay High Court’s judgment in Khadi & Village Industries Commission v. Jaishukh N. Bhuta & Ors.
Factual Background
The plaintiff, KVIC, a statutory body under the Khadi & Village Industries Commission Act 1956, owns the registered mark “Khadi” along with the Charkha logo. In a prior case, the respondent, MKVIA, had given an undertaking to the Court that it would not sell any product labelled as “Khadi” without the Plaintiff’s certification. Eventually, MKVIA violated the undertaking, leading to a civil suit in December 2022, where the Court passed an interim injunction restraining MKVIA, its partners, servants, representatives, agents and all others acting for and on its behalf from manufacturing, selling, or advertising goods under the “Khadi” mark or Charkha logo, and from using “Khadi” as part of its trade name. KVIC brought two proceedings alleging breach of the injunction. First, an application under Order XXXIX Rule 2A over MKVIA’s Khadi Mahotsav 2.0. Second, a Contempt Petition concerning a land sale agreement and an old business directory listing. Both petitions were heard together, and the ambit of the injunction became central to deciding whether MKVIA’s conduct in each of these three instances amounted to a breach.
Order XXXIX Rule 2A: What does it actually do?
Order XXXIX Rule 2A gives a discretionary power to the Court to attach the property or impose civil imprisonment up to three months on any person who breaches the terms of the injunction granted under Order XXXIX, Rules 1 and 2. Attachment can continue up to one year, after which the property may be sold and the proceeds used to compensate the affected party. These are the coercive measures intended to secure compliance with the injunction. It is worth noting that the Bombay High Court in the present case rejected the argument that Rule 2A proceedings are quasi-criminal in nature and thus require proof beyond reasonable doubt.
The Court distinguishes Rule 2A from the Contempt power under Article 215, which belongs only to the High Courts and the Supreme Court, as Courts of Record. Rule 2A, by contrast, is a power available to every civil court, and only to protect interim orders passed under Order XXXIX, Rules 1 and 2. Treating these two powers as the same ignores why each one exists. The provision exists to address an actual breach of an order and to secure compliance, not to conduct an inquiry into intention, as a court of contempt requires.
Two Separate Inquiries, Not One
The real contribution of this judgment lies in keeping two questions regarding Order XXXIX Rule 2A, separate: first, whether a party actually disobeyed the order, and second, what should happen once disobedience is established. The first one is related to the fact, did the conduct fall within what the order actually prohibited? The second is a discretionary one: once the disobedience is proved, does the coercive machinery of Rule 2A still need to be used, or has its purpose already been served in some other way? However, the CPC leaves room to treat these as two distinct steps. This distinction matters because, more often than not, including in the present case, the opposite is argued. Plaintiffs, in their submission, contended that once the breach is proved, the attachment and imprisonment should automatically follow. The Court declined to accept this, even from the party that had established the breach.
What The Injunction Actually Prohibited
Before going on to either question, firstly, it is important to determine the scope of the injunction. Here, the injunction restrained the Mumbai Khadi & Village Industries Association (MKVIA), its partners, servants, representatives, agents and all others acting for and on its behalf from manufacturing, selling, or advertising goods under the “Khadi” mark or Charkha logo, and from using “Khadi” as part of its trade name. This difference became decisive. It meant that the question in each allegation was whether the particular conduct of the MKVIA had a connection with the prohibited activity necessary to bring it within the ambit of the injunction.
Establishing Wilful Breach
Applying the same, the Court found the Khadi Mahotsav 2.0 to be a clear case of wilful breach. The event was held on MKVIA’s own premises over three days, with promotional material naming MKVIA as co-organiser alongside Atharva School under the Charkha logo. The court rejected MKVIA’s defence that it had no knowledge of the event held on its own premises. It is important to note the standard of proof the Court used. MKVIA argued that Rule 2A proceedings require proof beyond a reasonable doubt, but the Court, relying on Amazon v. Future Retail, applied the civil standard of preponderance of probability. This simply means that the Court must be satisfied with a version of the event that is more likely to be true. This matters because, if the Court had used the beyond a reasonable doubt standard, as contended by the Respondent, then their claim of lack of knowledge would have created a reasonable doubt.
Further, the two allegations, the sale agreement and directory listings, raised in the contempt petition, failed at the threshold on application of the same test. The Sale Agreement had MKVIA’s full name, but it was in connection with a land transaction, not with the sale or promotion of Khadi products. The old directory listing involved no fresh conduct after the injunction; it was a third-party listing that predated the order, and MKVIA had already taken steps to remove it. Neither involved conduct that the injunction restrained. Therefore, both were rejected in the Contempt Petition.
Decoding The Consequences
It is worth noting that after establishing breach of injunction by MKVIA, the Court didn’t automatically attach their property or order civil imprisonment. The Court declined both measures, noting that MKVIA had not engaged in any further Khadi-related activity.
The importance of this lies in the distinction between establishing a breach and deciding what to do about it. As explained by the Supreme Court under Samee Khan v. Bindu Khan and Amazon v. Future Retail, attachment and imprisonment under Rule 2A are primarily coercive measures intended to secure compliance with the injunction. Once there is no ongoing violation to prevent, the justification for deploying those measures weakens. Therefore, the judgment rejects a mechanical sequence in which “breach” necessarily leads to “attachment or imprisonment”.
However, the Court, using Section 151 of CPC, which empowers the Court to pass any order necessary to secure the ends of justice, ordered MKVIA to pay Rs. 2,50,000 in costs, warned the trustees, and asked them to file affidavits regarding the Mahotsav’s finances, steps taken to prevent it from happening again, and progress in removing MKVIA’s name from old listings.
The judgment clarifies that the breach under Order XXXIX Rule 2A doesn’t automatically trigger imprisonment or property attachment. It aims to secure compliance, not extract retribution. Once the disobedience stops, the Court’s priority shifts from punishing the past to preventing future violations.
