The High Court of Delhi through its judgment dated 01.07.2025 in Communication Components Antenna Inc. v. Ace Technologies Corp. and Ors.1 held that Section 151 of Code of Civil Procedure, 1908 ("CPC") gives sufficient and wide discretionary power to the court to exercise, however, there is no qualm that a general provision of law like Section 151 of CPC is to be exercised sparingly by the court with caution and circumspection.
In the present case, the Communication Components Antenna Inc. ("Communication Components") filed a suit seeking permanent injunction restraining Ace Technologies Corp ("Ace Technologies") from infringing upon its patent in India. While the suit was at the stage of recording of evidence, Communication Components filed an application under Section 151 of CPC seeking a direction to Ace Technologies to deposit bank guarantee in the court. Communication Components argued that by the time present suit is decided, Ace Technologies would not be in a financial position to satisfy any decree of this court, considering the fact that it had lost more than 64.90% of its share value.
The High Court held that while exercising power under Section 151 of CPC, the court may be faced with a situation where granting an interim relief to an effected party may tantamount to granting final relief itself, when faced with such a situation, it will be relevant for the court to consider if it will be too late when the time comes for granting final relief, no execution will be possible despite decree in its favour.
Further, the High Court held that under such circumstances, the court has to be convinced/persuaded by the effected party that there is (a) prima facie case in its favour, (b) balance of convenience lies in its favour and (c) irreparable harm, loss and injury will be caused to the effected party. In the present case, the High Court directed Ace Technologies to deposit 25% of the amount claimed by Communication Components as damages, considering the depreciating financial position of Ace Technologies.
Footnote
1 I.A. 36658/2024 in CS(COMM) 1222/2018.
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