Synopsis

The plaintiff (a distributor of antivirus software) filed a suit for specific performance against the defendant (the original equipment manufacturer, OEM). The plaintiff alleged that for various tenders, the defendant had confirmed deals and “opportunity lock” before the plaintiff participated in tenders. The plaintiff had already received purchase orders from three entities, supplied initial quantities, and was obliged to supply additional licenses upon demand. The defendant terminated the relationship claiming that the plaintiff was earning excessive profit margins while the defendant’s own margins were low. The plaintiff sought interim relief directing the defendant to continue maintenance services and supply additional licenses for those three entities. The High Court, finding a prima facie case, balance of convenience, and irreparable harm, granted the interim relief. It also referred the parties to mediation.

Court: High Court of Delhi

Coram: Honourable Ms. Justice Mini Pushkarna

Date of Judgment: 22nd April 2026

Citation: I.A. 16592/2026 in CS(COMM) 347/2025 (2026:DHC:3453) (unreported)

Core Law: Code of Civil Procedure, 1908 – Order XXXIX Rules 1 and 2 (interim injunction); Specific Relief Act, 1963 – specific performance; contract law – distribution agreements, OEM‑distributor relationship

2. Legal Framework

Major laws and provisions involved

• Code of Civil Procedure, 1908 – Order XXXIX Rules 1 and 2 (grant of temporary injunction/interim relief)

• Specific Relief Act, 1963 – Sections 10, 14, 20 (specific performance of contract)

• Contract Act, 1872 – principles of breach of contract, anticipatory breach

• Principles of interim injunction – triple test: prima facie case, balance of convenience, irreparable injury

Key legal principles applied

Interim relief pending specific performance suit: In a suit for specific performance, the court may grant interim relief to protect the subject matter of the contract and prevent irreparable harm. The plaintiff must show a prima facie case that the contract is valid and enforceable, that the balance of convenience favours granting relief, and that irreparable injury will be caused if relief is denied.

Prima facie case in distribution agreements: Where a distributor has already obtained purchase orders from end customers based on the OEM’s commitment, and there is evidence of confirmed deals, the court will prima facie accept that there is a binding arrangement. The fact that the plaintiff may be earning higher margins does not, by itself, justify termination without notice.

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