Supreme Court of India
URBAN INFRASTRUCTURE REAL ESTATE FUNDversusDHARMESH S. JAIN AND ANR.
- Citation
- 2022 INSC 296
- Decided
- 10 March 2022
- Disposal
- Disposed off
- Bench
- M R SHAH
Holding
The respondents willfully disobeyed the orders of the High Court and the Supreme Court and are guilty of civil contempt.
Summary
The Urban Infrastructure Real Estate Fund (U.I.R.E.F) obtained an arbitral award of Rs 78.33 crore against Dharmesh S. Jain and others, which the Bombay High Court stayed on the condition that the respondents deposit 50% of the amount. The High Court’s order dated 08‑08‑2019 was later extended twice by the Supreme Court (orders dated 17‑09‑2021 and 28‑10‑2021). The respondents failed to make the deposit, claiming financial difficulty, and sought further relief. The Supreme Court held that the deposit direction was mandatory, the respondents’ failure to comply without seeking an extension or explaining the delay amounted to willful disobedience, and therefore constituted civil contempt. The Court affirmed its contempt jurisdiction despite the award’s executability and sentenced the respondents to appropriate punishment. The contempt petition was disposed of with the respondents found guilty of civil contempt.
Issues considered
- Whether the respondents’ non‑payment of the amount directed by the High Court and the Supreme Court amounts to willful disobedience attracting civil contempt.
- Whether the direction to deposit the amount was mandatory or merely directory for the purposes of contempt jurisdiction.
- Whether the Supreme Court can invoke contempt jurisdiction when the underlying award is executable under the Arbitration Act.
- Whether financial constraints constitute a valid excuse for non‑compliance without seeking an extension or explaining the delay.
Legislation cited
Subjects
civil contemptcontempt of courtarbitration awardstay ordernon‑compliancefinancial difficultyextension of timeSupreme CourtHigh CourtSection 34 Arbitration ActSection 36 Arbitration Act
Judgment
1148 SUPREME COURT
[2022]REPORTS
3 S.C.R. 1148 [2022] 3 S.C.R.
A URBAN INFRASTRUCTURE REAL ESTATE FUND
v.
DHARMESH S. JAIN AND ANR.
(Contempt Petition (C) No. 940 of 2021)
B In
(Miscellaneous Application No. 1668 of 2021)
In
(Special Leave Petition (C) No. 14724 of 2021)
C
MARCH 10, 2022
[M. R. SHAH AND B. V. NAGARATHNA, JJ.]
Contempt of Courts Act,1971 – Civil contempt – Wilful
disobedience of orders passed by Court – High Court stayed arbitral
D award passed in arbitral proceedings filed by petitioner against
respondents-alleged contemnors subject to deposit of an amount –
Time period of such deposit was extended by Supreme Court on two
occasions while continuing the order of stay by implication – Plea
of respondents-contemnors that there was no wilful disobedience
and because of financial constraint, they were not in a position to
E deposit the amount as ordered by the High Court and the Supreme
Court – At no point of time earlier, such a plea was taken – Held:
On facts, the plea lacked bonafides and was not tenable, being an
afterthought – When a party which is required to comply with the
terms or directions in an order has not done so within such time as
F stipulated in the order, two options are available to the party which
was required to comply with such order: (a) give an explanation to
the Court as to the circumstances due to which the party could not
comply with the order of the Court; (b) seek for further time to
comply with the order of the Court – If a delay has occurred in
complying with the terms of an order and the party which was to
G comply with the order has not resorted to either of the two aforestated
options, then, the party responsible for delay in compliance, may
be held to have committed contempt – Further, irrespective of whether
or not a decree is executable, the question to be considered in
determining whether a case for contempt has been made out was,
H whether, the conduct of the contemnor was such as would make a
1148
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1149
JAIN AND ANR.
fit case for awarding punishment for contempt of Court – In the A
case at hand, the conduct of respondent-contemnors was such as
would justify invocation of contempt jurisdiction of Supreme Court
– Not only did the contemnors unreasonably delay and default in
compliance of orders of Supreme Court without explaining the cause
for such default, or seeking extension of time for compliance; but
B
they also sought to avoid compliance of the order, even after taking
benefit of the extended time period granted for compliance of the
same – The contemnors cannot, at this juncture, claim that the
requirement of deposit was not mandatory, but directory and
therefore non-compliance thereof would not constitute contempt –
On facts, respondents-contemnors willfully disobeyed the orders C
passed by the Court and were thereby guilty of civil contempt and
rendered themselves liable for suitable punishment under provisions
of Contempt of Courts Act – Arbitration and Conciliation Act, 1996
– s.34.
Contempt of Courts Act, 1971 – Contempt jurisdiction – D
Invocation of – Powers of the Court – Scope and ambit of – Held:
Jurisdiction of a Court under the Act, would not cease, merely
because the order or decree of which contempt is alleged, is
executable under law, even without having recourse to contempt
proceedings – Contempt jurisdiction could be invoked in every case
where the conduct of a contemnor is such as would interfere with E
the due course of justice – Contempt is a matter which is between
the Court passing the order of which contempt is alleged and the
contemnor; questions as to executability of such order is a question
which concerns the parties inter-se – Power of the Court to invoke
contempt jurisdiction, is not, in any way, altered by the rights of the F
parties inter-se.
Disposing of the contempt petition, the Court
HELD:1.1 In the instant case, the High Court, by order
dated 08th August, 2019 stayed the arbitral award dated
30.08.2018 passed in arbitral proceedings filed by the petitioner G
against the respondents-alleged contemnors subject to the
deposit of an amount. The time period of such deposit has been
extended by this Court on two occasions while continuing the
order of stay by implication. Having taken the advantage of the
H
1150 SUPREME COURT REPORTS [2022] 3 S.C.R.
A extended time period, the respondent-contemnor cannot, at this
juncture, take the plea that non-compliance with the condition of
deposit would only render the Arbitrator’s Award enforceable and
that such failure to comply would have no consequences under
the Contempt of Courts Act, 1971. [Para 13.1][[1170-B-C]
B 1.2. Further, it is trite law that the jurisdiction of a Court
under the Contempt of Courts Act, 1971, would not cease, merely
because the order or decree of which contempt is alleged, is
executable under law, even without having recourse to contempt
proceedings. [Para 13.2][1170-D]
C 1.3. Contempt jurisdiction could be invoked in every case
where the conduct of a contemnor is such as would interfere with
the due course of justice. Contempt is a matter which is between
the Court passing the order of which contempt is alleged and the
contemnor; questions as to executability of such order is a
question which concerns the parties inter-se. The power of the
D Court to invoke contempt jurisdiction, is not, in any way, altered
by the rights of the parties inter-se. [Para 13.3][1170-E]
2. Now, so far as the case on behalf of the respondents that
there is no wilful disobedience and because of the financial
constraint, the respondents are not in a position to deposit the
E amount as ordered by the High Court vide order dated 08.08.2019
and the order passed by this Court is concerned, the same is
nothing but an afterthought. At no point of time earlier, such a
plea was taken. In the facts and circumstances of the case, such
a stand now lacks bonafides. The stand taken by the respondents
F now that they are not in a position to deposit the amount and/or
comply with the order passed by the High Court and this Court
because of the financial difficulties and therefore there is no wilful
disobedience by the respondents in not complying with the order
passed by the High Court dated 08.08.2019 and the order passed
by this Court dated 28.10.2021 in Miscellaneous Application No.
G 1668 of 2021 in Special Leave Petition (C) No. 14724 of 2021
lacks bonafides and the same is not at all acceptable. [Para
14][1170-F-G; 1171-C-D]
H
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1151
JAIN AND ANR.
3.1. When a party which is required to comply with the terms A
or directions in an order has not done so within such time as
stipulated in the order, two options are available to the party which
was required to comply with such order: (a) give an explanation
to the Court as to the circumstances due to which the party could
not comply with the order of the Court; (b) seek for further time
B
to comply with the order of the Court. If a delay has occurred in
complying with the terms of an order and the party which was to
32 comply with the order has not resorted to either of the two
aforestated options, then, the party responsible for delay in
compliance, may be held to have committed contempt. [Para
15][1171-D-F] C
3.2. Further, irrespective of whether or not a decree is
executable, the question to be considered by this Court in
determining whether a case for contempt has been made out was,
whether, the conduct of the contemnor was such as would make
a fit case for awarding punishment for contempt of Court. [Para D
15.1][1171-G]
4.1. In the case at hand, the conduct of the respondent-
contemnors is such as would justify invocation of contempt
jurisdiction of this Court. Not only have the contemnors
unreasonably delayed and defaulted in compliance of the orders E
of this Court without explaining the cause for such default, or
seeking extension of time for compliance; but they have also
sought to avoid compliance of the order, even after taking benefit
of the extended time period granted for compliance of the same.
The contemnors cannot, at this juncture, claim that the
requirement of deposit was not mandatory, but directory and F
therefore non-compliance thereof would not constitute contempt.
[Para 16][1171-H; 1172-A-B]
4.2. The respondents have willfully disobeyed the order
passed by the High Court dated 08.08.2019 in Notice of Motion
No. 960 of 2019 in Commercial Arbitration Petition No. 55 of G
2019 and have willfully disobeyed the order dated 28.10.2021
passed by this Court in Miscellaneous Application No. 1668 of
2021 in Special Leave Petition (C) No. 14724 of 2021 and thereby
the respondents are guilty of civil contempt and have rendered
H
1152 SUPREME COURT REPORTS [2022] 3 S.C.R.
A themselves liable for suitable punishment under the provisions
of Contempt of Courts Act. [Para 17][1172-C-D]
Sudhir Vasudeva v. M. George Ravishekaran (2014) 3
SCC 373 : [2014] 4 SCR 27; R.N. Dey & Ors. v.
Bhagyabati Pramanik & Ors. (2000) 4 SCC 400
B : [2000] 3 SCR 172 – distinguished.
Rama Narang v. Ramesh Narang (2006) 11 SCC 114
: [2006] 3 SCR 1068; Bank of Baroda v. Sadruddin
Hasan Daya (2004) 1 SCC 360 : [2003] 6 Suppl.
SCR 764; State of Bihar v. Subhash Singh (1997) 4 SCC
C 430 : [1997] 1 SCR 850; Maruti Udyog v. Mahinder
C. Mehta AIR 2008 SC 309 : [2007] 10 SCR 933 –
relied on.
Mrityunjoy Das and Anr. v. Sayed Hasibur Rahaman
and Ors., (2001) 3 SCC 739 : [2001] 2 SCR 471; Ram
D Kishan v. Tarun Bajaj & Ors., (2014) 16 SCC 204 :
[2014] 1 SCR 538; Dinesh Kumar Gupta v. United India
Insurance Company Limited & Ors., (2010) 12 SCC
770 : [2010] 13 SCR 599; Jolly George Varghese &
Anr. v. The Bank of Cochin, (1980) 2 SCC 360 : [1980]
2 SCR 913; Dr. U.N. Bora, Ex. Chief Executive Officer
E & Ors. v. Assam Roller Flour Mills Association & Anr.
(2022) 1 SCC 101; Rita Markandey v. Surjit Singh
Arora, (1996) 6 SCC 14 : [1996] 7 Suppl. SCR 56 –
referred to.
Case Law Reference
F
[2000] 3 SCR 172 distinguished Para 3.5
[2001] 2 SCR 471 referred to Para 3.7
[2014] 1 SCR 538 referred to Para 3.7
[2010] 13 SCR 599 referred to Para 3.7
G
[1980] 2 SCR 913 referred to Para 3.7
(2022) 1 SCC 101 referred to Para 3.7
H
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1153
JAIN AND ANR.
[2006] 3 SCR 1068 relied on Para 4.6 A
[2003] 6 Suppl. SCR 764 relied on Para 4.6
[1996] 7 Suppl. SCR 56 referred to Para 4.6
[2014] 4 SCR 27 distinguished Para 13.1
[1997] 1 SCR 850 relied on Para 15 B
[2007] 10 SCR 933 relied on Para 15.1
INHERENT APPELLATE JURISDICTION: Contempt Petition
(C) No. 940 Of 2021 in Miscellaneous Application No. 1668 Of 2021 in
Special Leave Petition (C) No. 14724 of 2021.
C
From the Judgment and Order dated 17.09.2021 and subsequent
order dated 28.10.2021 of this Court and dated 08.08.2019 of the High
Court of Judicature at Bombay in Notice of Motion No.960 of 2019 in
Commercial Arbitration Petition No.55 of 2019.
Jayant Bhushan, Sr. Adv., Puneet Singh Bindra, Neeraj Kumar, D
Dhiraj Mhetre, Ms. Simran Jeet, Satyasrikant Vutha, Sanampreet Singh,
Sunny Sachin Rawat, Advs. for the Petitioner.
Shyam Divan, Sr. Adv., Ashok Paranjpe, Kunal Vajani, Kunal
Mimani, Shreyas Lele, Shubhang Tandon, Sugandha Yadav, Advs. for
the Respondents. E
The Judgment of the Court was delivered by
M. R. SHAH, J.
1. The present contempt petition has been filed by the petitioner
herein – Urban Infrastructure Real Estate Fund – the Award Creditor in F
whose favour there is an award passed by the learned Arbitrator to
punish the respondents under the Contempt of Courts Act, 1971 for
wilful disobedience of the order dated 17.09.2021 passed by this Court
in Special Leave Petition (C) No. 14724 of 2021 and the subsequent
order dated 28.10.2021 passed in Miscellaneous Application No. 1668
of 2021 in the very same Special Leave Petition (C) No. 14724 of 2021. G
2. Before considering the submissions made by learned senior
counsel appearing on behalf of the respective parties, the chronological
dates and events leading up to the filing of this contempt petition are
required to be referred to and considered, which are as under:-
H
1154 SUPREME COURT REPORTS [2022] 3 S.C.R.
A 2.1 That by Arbitral Award dated 30.08.2018 passed in arbitral
proceedings filed by the petitioner herein against the respondents - alleged
contemnors, the learned Arbitrator awarded specific performance of
the Share Purchase Agreement and held that the petitioner is entitled to
recover an amount of Rs. 78,33,37,500/- with interest at the rate of 18%
p.a. with effect from 20.12.2014 till realization.
B
2.2 Challenging the award passed by the learned Arbitrator, the
respondent herein preferred Commercial Arbitration Petition No. 55 of
2019 before the High Court under Section 34 of the Arbitration and
Conciliation Act, 1996 (hereinafter referred to as “Act of 1996”). In the
said arbitration petition, the respondents herein – original applicants took
C
out a Notice of Motion No. 960 of 2019 praying for stay of the award.
2.3 The learned Single Judge of the High Court disposed of the
said Notice of Motion in terms of the prayer clause “a” on the condition
that the respondents herein deposit 50% of the awarded sum within
twelve weeks. The learned Single Judge also observed that if such deposit
D
is not made within the time prescribed, the interim stay granted shall
stand vacated without further reference to the Court. Simultaneously,
the petitioner was also directed to deposit 50% of its shareholding in the
respondent No. 2 company within one week of deposit of amount. The
learned Single Judge also made it clear that if the respondents – original
E applicants commit any default in making payments as directed, the
respondent (applicant herein) is not required to deposit such shares.
2.4 It appears that even before the application under Section 34
of the Act of 1996 challenging the award was made, the Award Creditor
had filed the execution petition before the High Court being Commercial
F Execution Application No. 2908 of 2018. After the order was passed by
the learned Single Judge dated 08.08.2019, a Notice of Motion No. 960
of 2019 was filed. The learned Single Judge being the Executing Court
passed the order dated 18.11.2019 in the Chamber Summons No. 357 of
2019 taken out by the Award Creditor. The learned Single Judge directed
the respondent herein to file the disclosure affidavit declaring their assets
G
vide order dated 18.11.2019. The order dated 18.11.2019 was, however,
not complied with by the respondents and repeated extensions were
sought.
2.5 That in the meantime, respondents herein instituted Commercial
Appeal No. 521 of 2019 challenging the order dated 08.08.2019 by which,
H
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1155
JAIN AND ANR. [M. R. SHAH, J.]
while staying the award passed by the learned Arbitrator, the High Court A
directed them to deposit 50% of the awarded amount. It is required to
be noted that during the pendency of the Commercial Appeal No. 521 of
2019, the respondents herein i.e., the contemnors – appellants before
the High Court prayed for a number of extensions to deposit the amount
as directed by the learned Single Judge vide order dated 08.08.2019.
B
2.6 The aforesaid appeal came to be dismissed as not maintainable
vide order dated 29.07.2021 and the interim application was also disposed
of. Being aggrieved, the respondents herein preferred special leave petition
before this Court challenging the order dated 08.08.2019 in Notice of
Motion No. 960 of 2019 and in Commercial Arbitration Petition No. 55
of 2019. That by order dated 17.09.2021, this Court dismissed the said C
special leave petition on merits. However, a prayer was made on behalf
of the respondents herein – petitioners before this Court to grant further
eight weeks’ time from 17.09.2021 to comply with the order dated
08.08.2019 by which they would deposit 50% of the amount as awarded
by the Arbitrator. This Court granted further eight weeks’ time as prayed. D
As the order dated 17.09.2021 was passed ex- parte and without notice
to the applicant herein – respondents in special leave petition, the applicant
herein preferred Miscellaneous Application No. 1668 of 2021 to recall
the order dated 17.09.2021 by which further eight weeks’ time was
granted to the respondents – petitioners before this Court.
E
2.7 It was the case on behalf of the applicants that the respondents
have no intention to comply with the order and deposit 50% of the amount
awarded by the learned Arbitrator and further eight weeks’ time is sought
only to kill time as there is no intention to deposit the amount and/or
comply with the order dated 08.08.2019 passed by the High Court.
F
2.8 That after hearing the learned counsel appearing on behalf of
the respective parties including the counsel on behalf of the respondents,
this Court passed an order dated 28.10.2021 in Miscellaneous Application
No. 1668 of 2021 of which also non- compliance is alleged. By order
dated 28.10.2021, this Court had directed the respondents herein –
petitioners before this Court in Special Leave Petition (C) No. 14724 of G
2021 to comply with and deposit the amount to be deposited as per the
order passed by the High Court dated 08.08.2019 positively and within
the time granted by this Court (eight weeks). This Court also further
observed that non-compliance of the same shall be treated very seriously
and non-deposit of the amount as directed by the High Court in the H
1156 SUPREME COURT REPORTS [2022] 3 S.C.R.
A impugned order shall be treated as non-compliance of the order of this
Court and also having serious consequences.
2.9 Despite the specific directions issued by this Court, the
respondents neither complied with the order passed by the High Court
dated 08.08.2019 nor complied with the order passed by this Court dated
B 28.10.2021 in Miscellaneous Application No. 1668 of 2021 in Special
Leave Petition (C) No. 14724 of 2021.
2.10 That the applicant herein served a legal notice upon the
respondents dated 16.11.2021 by which the respondents were called
upon to comply with the order dated 08.08.2019 passed by the High
C Court as well as the orders passed by this Court dated 17.09.2021 and
28.10.2021. In the said legal notice, it was specifically mentioned that if
the aforesaid orders are not complied with, the petitioners shall be
constrained to proceed further to initiate appropriate proceedings for
wilful disobedience of orders passed by the Court. One other legal notice
was served upon the respondents informing that the time granted by this
D Court in Special Leave Petition (C) No. 14724 of 2021 to comply with
the order dated 08.08.2019 had expired. Despite the above, neither the
order passed by the High Court dated 08.08.2019 was complied with
nor the orders passed by this Court dated 17.09.2021 and 28.10.2021
was obeyed. Instead, having realized that the non-compliance of the
E order dated 28.10.2021 may invite serious consequences, the respondents
herein filed Miscellaneous Application No. 61 of 2022 on 17.01.2022
requesting to recall the order dated 28.10.2021 passed by this Court in
Miscellaneous Application No. 1668 of 2021.
2.11 By a detailed order dated 25.01.2022, this Court had dismissed
F the said application by which the respondents herein had requested recall
of the order dated 28.10.2021 passed in Miscellaneous Application No.
1668 of 2021.
2.12 At this stage, it is required to be noted that a number of
submissions were made by the learned counsel appearing on behalf of
G the respondents – applicants before this Court in Miscellaneous
Application No. 61 of 2022 on the directions issued by this Court vide
order dated 28.10.2021, which are again made by the learned counsel
appearing on behalf of the respondents before this Court in the present
proceedings and all the submissions were dealt with by this Court while
deciding Miscellaneous Application No. 61 of 2022.
H
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1157
JAIN AND ANR. [M. R. SHAH, J.]
2.13 At this stage, it is required to be noted that prior to filing of A
the Miscellaneous Application No. 61 of 2022, the petitioners had already
filed the present application alleging disobedience of the order dated
28.10.2021 passed in Miscellaneous Application No. 1668 of 2021, which
was filed on 18.11.2021 in which this Court directed to issue notice upon
the respondents vide order dated 10.12.2021 making it returnable on
B
10.01.2022 and having been served with the notice of this Court in the
present contempt petitions, the respondents filed the aforesaid
Miscellaneous Application No. 61 of 2022 and have prayed to recall the
order dated 28.10.2021, which as observed hereinabove has already
been dismissed by this Court vide order dated 25.01.2022.
3. Shri Shyam Divan, learned Senior Advocate appearing on behalf C
of the respondents – alleged contemnors has as such reiterated what
was submitted earlier while deciding Miscellaneous Application No. 61
of 2022.
3.1 Shri Divan, learned Senior Advocate has submitted that as
such there is no direction issued by this Court of which non- compliance D
is alleged. Elaborating the same he submitted that by order dated
17.09.2021, this Court while dismissing the special leave petition preferred
by the respondents extended the time to comply with the order dated
08.08.2019 passed by the learned Single Judge. It is submitted that the
said order dated 08.08.2019 was an interim order passed on Notice of E
Motion by which, while granting stay of the award passed by the learned
Arbitrator, the respondents were directed to deposit 50% of the amount
awarded. It is submitted that in the order dated 08.08.2019 itself, the
learned Single Judge specifically observed that on non-compliance of
the same, the interim stay granted would stand vacated. It is contended
that by not deposing 50% of the awarded amount within the stipulated F
period of time and the extended period of time, there shall not be any
stay of the award passed by the learned Arbitrator and therefore the
said award shall be executable and the execution proceedings are required
to be heard and proceeded further. It is therefore urged that non-
compliance of the order dated 08.08.2019 does not warrant any G
proceedings under the Contempt of Courts Act, 1971, as the order dated
08.08.2019 cannot be said to be a mandatory order or a direction to
deposit 50% of the amount awarded. It is also submitted that the order
dated 17.09.2021 cannot be said to be any order or direction issued by
this Court.
H
1158 SUPREME COURT REPORTS [2022] 3 S.C.R.
A 3.2 Shri Divan, learned Senior Advocate has taken us to Section
36 of the Act of 1996 in support of his submission that on non- deposit of
the amount awarded by the Arbitral Tribunal, the award is executable. It
is submitted that as such an execution application is already filed and
pending.
B 3.3 It is further submitted that when the petitioner filed
Miscellaneous Application No. 1668 of 2021 seeking recall of the order
dated 17.09.2021 passed by this Court, even the petitioner did not construe
the condition of deposit to be a mandatory direction to deposit.
3.4 It is further submitted by Shri Divan, learned Senior Advocate
C appearing on behalf of the respondents that the order dated 17.09.2021
was not a mandatory order directing the respondents to deposit 50% of
the amount and the order dated 17.09.2021 was an order extending the
time in favour of the respondents to deposit the amount as per the order
passed by the learned Single Judge. Even the subsequent order dated
28.10.2021 passed on an application filed by the petitioner to recall the
D order dated 17.09.2021, cannot be said to be a mandatory order and/or
direction, the non- compliance of which warrants any proceedings under
the Contempt of Courts Act, 1971.
3.5 It is further urged by Shri Divan, learned Senior Advocate
appearing on behalf of the respondents that on non-compliance of the
E order passed by the learned Single Judge dated 08.08.2019 by which on
non-deposit of 50% of the amount, the interim stay granted stood vacated
and therefore, the award is to be executed for which the execution
proceedings are pending and the contempt of court proceeding is not the
remedy available to the petitioner. It is submitted that as held by this
F Court in the case of R.N. Dey and Ors. Vs. Bhagyabati Pramanik
and Ors., (2000) 4 SCC 400, the weapon of contempt cannot be used
for purposes of executing a decree or implementing an order for which
law provides appropriate procedure.
3.6 Shri Divan, learned Senior Advocate appearing on behalf of
G the respondents has contended that as such there is no wilful disobedience
of any of the orders passed by this Court and/or even the High Court. In
fact, the respondents have made honest endeavors to comply with the
condition of deposit. However, despite the best efforts during the eight
weeks’ time granted by this Hon’ble Court, the respondents have been
unable to comply with the condition of deposit in view of the grave and
H unsurmountable challenges / difficulties being faced by the respondents.
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1159
JAIN AND ANR. [M. R. SHAH, J.]
3.7 It is further submitted that the dispute is in the nature of a A
commercial dispute and negotiations are going on and final figures are to
be settled. That the respondents have already given a demand draft of
Rs. 5 crores to show their bonafides and are ready to submit a further
sum of Rs. 5 crores with the Registry of the High Court. It is submitted
that therefore, when there is no wilful disobedience, the present contempt
B
proceedings be dismissed. Reliance is placed upon the decisions of this
Court in the case of Mrityunjoy Das and Anr. Vs. Sayed Hasibur
Rahaman and Ors., (2001) 3 SCC 739 (Paras 13 & 14); Ram Kishan
Vs. Tarun Bajaj & Ors., (2014) 16 SCC 204 (Paras 11 to 15); Dinesh
Kumar Gupta Vs. United India Insurance Company Limited &
Ors., (2010) 12 SCC 770 (Para 17); Jolly George Varghese & C
Anr. Vs. The Bank of Cochin, (1980) 2 SCC 360 (Paras 1, 2, 4, 6,
10 & 11); and Dr. U.N. Bora, Ex. Chief Executive Officer & Ors.
Vs. Assam Roller Flour Mills Association & Anr. (2022) 1 SCC
101 (Paras 8 & 9).
4. Shri Jayant Bhushan, learned Senior Advocate appearing on D
behalf of the petitioner has submitted that as on today, a total sum of Rs.
190 crores is due and payable by the respondents pursuant to the award
passed by the learned Arbitrator, which was passed four years back.
4.1 It is submitted by Shri Bhushan, learned Senior Advocate that
right from the filing of the execution proceedings by the petitioner, at E
every stage, the respondents have delayed the execution of the award
on one ground or the other either, by filing Notice of Motion and obtaining
interim stay of the award on condition of deposit of 50% of the awarded
amount and thereafter getting extensions even during the pendency of
the appeal and making the Court believe that they will deposit the amount
as per the orders passed by the learned Single Judge dated 08.08.2019. F
It is submitted that during all these periods, the respondents have taken
advantage of the extensions sought by them. It is submitted that therefore
it would not be open for the respondents to now say that on non-deposit
of the 50% of the amount as ordered by the learned Single Judge in his
order dated 08.08.2019, the award is executable. G
4.2 It is submitted by Shri Jayant Bhushan, learned Senior Advocate
appearing on behalf of the petitioner that even the respondents have not
complied with the order passed by the High Court in the Chamber
Summons taken out by the petitioner by which the respondents were
directed to disclose their assets. It is submitted that despite a number of H
1160 SUPREME COURT REPORTS [2022] 3 S.C.R.
A opportunities given by the High Court, the respondents have not complied
with the direction issued by the High Court by which the respondents
were directed to disclose their assets, which they declared after a period
of almost two and a half years. It is, therefore, submitted that all throughout
the conduct on the part of the respondents suggest that respondents are
in the habit of not complying with the orders/directions issued by the
B
Court(s).
4.3 It is also submitted by Shri Jayant Bhushan, learned Senior
Advocate appearing on behalf of the petitioner that despite the dismissal
of the Miscellaneous Application No. 61 of 2022, the respondents have
the audacity to now say that the order dated 28.10.2021 cannot be said
C to be a mandatory direction. He has taken us to the averments in the
Miscellaneous Application No. 61 of 2022 in which the very respondents
have stated that the order dated 28.10.2021 is a mandatory order/direction.
It is submitted that by taking such a stand, the respondents have
aggravated their contumacious conduct.
D 4.4 Now, so far as the submission on behalf of the respondents
that, the order passed by the learned Single Judge dated 08.08.2019 and
the subsequent order passed by this Hon’ble Court dated 17.09.2021
cannot be said to be a direction and if there is non-compliance of the
same, the consequences under Section 36 of the Act of 1996 shall follow
E and the award thereafter will have to be executed, it is vehemently
submitted by Shri Jayant Bhushan, learned Senior Advocate appearing
on behalf of the petitioner that the non-compliance alleged is not only of
the order dated 08.08.2019 passed by the learned Single Judge of the
High Court and the order dated 17.09.2021 passed by this Hon’ble Court
but the non-compliance alleged is of the order dated 28.10.2021 also by
F which the specific mandatory direction has been issued by this Court
directing the respondents to deposit the amount as ordered by the learned
Single Judge. It is submitted that in the said order itself, it has been
specifically mentioned that non-compliance of the directions would be
having serious consequences. It is submitted that despite the above, the
G respondents have not deposited the amount as ordered by the learned
Single Judge vide order dated 08.08.2019.
4.5 Now, so far as the submission on behalf of the respondents
that there is no wilful disobedience and that despite their best efforts,
they are not in a position to deposit the amount as ordered due to financial
H crunch and other adverse circumstances, it is vehemently submitted by
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1161
JAIN AND ANR. [M. R. SHAH, J.]
Shri Jayant Bhushan, learned Senior Advocate appearing on behalf of A
the petitioner that the aforesaid stand now taken is nothing but an
afterthought and as such even when the Miscellaneous Application No.
61 of 2022 was filed, it was not the case on behalf of the respondents
that due to financial constraint and/or adverse circumstances, they are
not in a position to deposit the amount. It is submitted that even the
respondents can sell the development rights worth Rs. 100 crores and B
they have the financial capacity but have willfully disobeyed the orders
of this Court.
4.6 Making the above submissions and relying upon the decisions
of this Court in the case of Rama Narang Vs. Ramesh Narang &
Anr., (2006) 11 SCC 114 (Paras 24, 25, 30 & 32); Bank of Baroda C
Vs. Sadruddin Hasan Daya & Anr. (2004) 1 SCC 360 (Paras 12 &
14); and Rita Markandey Vs. Surjit Singh Arora, (1996) 6 SCC 14
(Para 12), it is prayed to suitably punish respondent No. 1 for wilful
disobedience of the direction issued by this Court vide order dated
28.10.2021.
D
5. Heard learned senior counsel for the respective parties at length.
6. In the present petition, it is prayed to punish the respondents
under the provisions of the Contempt of Courts Act for wilful disobedience
of the order dated 17.09.2021 passed by this Court in Special Leave
Petition (C) No. 14724 of 2021 and also the order dated 28.10.2021 E
passed in Miscellaneous Application No. 1668 of 2021 in Special Leave
Petition (C) No. 14724 of 2021. For immediate reference the said orders
are extracted as under:
Order dated 17.09.2021
“Delay condoned. F
Having heard Shri Shyam Divan, learned senior counsel
appearing for the petitioners and considering the fact that the
impugned order passed by the High Court is in a notice of motion
application and an interim order, we see no reason to interfere
with the impugned order.
G
The Special Leave petition is dismissed.
Pending application(s), if any, shall stand disposed of.
However, as prayed, we grant further eight weeks time
from today to the applicants to comply with the impugned order
passed by the High Court.” H
1162 SUPREME COURT REPORTS [2022] 3 S.C.R.
A Order dated 28.10.2021
“Having heard Shri Jayant Bhushan, learned senior counsel
appearing on behalf of the respondent no. 1 herein/Applicants -
Urban Infrastructure Real Estate Fund and Shri Kunal Vajani,
learned counsel appearing on behalf of the original petitioners
B before this Court, we dispose of the present application with an
observation that the petitioners before this Court in SLP (C) No.
14724/2021 shall have to comply with and deposit the amount to
be deposited as per the impugned order passed by the High Court
positively and within the time granted by this Court and non-
compliance of the same shall be treated very seriously and non-
C
deposit of the amount as directed by the High Court in the impugned
order shall be treated as non-compliance of our order also having
a serious consequences.
With this, the present application stands disposed of.”
D 7. It is the case on behalf of the respondents – alleged contemnors
that by the order passed by this Hon’ble Court dated 17.09.2021 in Special
Leave Petition (C) No. 14724 of 2021, this Court while dismissing the
said special leave petition has granted further eight weeks’ time to the
original applicants to comply with the order passed by the High Court
dated 08.08.2019 by which the High Court passed a conditional stay
E
order in favour of the original applicants – respondents herein and to
deposit 50% of the awarded amount, failing which the stay to stand
vacated. It is the case on behalf of the respondents that on non-compliance
of the order dated 08.08.2019, the necessary consequences under Section
36 of the Act of 1996 shall follow and the proceedings to execute the
F award has to be proceeded further. It is submitted therefore that as the
order dated 08.08.2019 cannot be said to be a direction and in view of
the remedy available to the applicants to proceed further with the
execution proceedings, no proceedings under the Contempt of Courts
Act for disobedience of the order dated 08.08.2019 and/or the order
passed by this Court dated 17.09.2021 in Special Leave Petition (C) No.
G
14724 of 2021 shall be maintainable. In the facts and circumstances of
the case and considering the conduct on the part of the respondents, this
submission cannot be accepted.
8. It is to be noted that there is an award dated 30.08.2018 in
favour of the applicant and the learned Arbitrator had awarded specific
H
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1163
JAIN AND ANR. [M. R. SHAH, J.]
performance of the Share Purchase Agreement and held that the applicant A
is entitled to recover an amount of Rs. 78,33,37,500/- with interest at the
rate of 18% p.a. with effect from 20.12.2014 till realization and had also
awarded Rs. 50 lakhs against the respondent company. Thereafter the
Award Creditor had filed the Execution Petition on 10.12.2018 and since
then, the respondents have successfully avoided the execution of the
B
award till date by initiating proceedings one after another and by getting
extensions of the interim order passed by the High Court dated 08.08.2019
passed on Notice of Motion No. 960 of 2019 and in Commercial
Arbitration Petition No. 55 of 2019. After the order dated 08.08.2019,
the respondents sought a number of extensions which the High Court
granted on the belief that the respondents will deposit the amount as C
ordered vide order dated 08.08.2019. Thus, the respondents took the
benefit of the extensions granted by the Court and the respondents were
granted the extension of time to make the deposit as per the order dated
08.08.2019, which were granted on their requests.
Having taken the benefit of the extensions for a period of D
approximately two years and more, thereafter, it is not open for the
respondents to contend that since they have not deposited the amount as
per the order dated 08.08.2019, necessary consequences under Section
36 of the Act of 1996 shall follow and the execution proceedings have to
be proceeded further. As observed hereinabove, the execution E
proceedings have been delayed in view of the interim order dated
08.08.2019 and the subsequent extensions granted by the High Court,
which were at the behest of the respondents. The respondents herein
have had the benefit of extensions of time being granted for depositing
the amount as per order dated 08.08.2019 and consequently have
successfully obstructed the execution proceedings for over two years. F
Having done so, respondents cannot now be permitted to contend that
there was no mandatory direction to comply with the order dated
08.08.2019 passed by the High Court. Such a conduct on the part of the
respondents is nothing but an abuse of process of law and the Court,
which is deprecated. At this stage, it is required to be noted that even the G
order passed by the High Court passed in Chamber Summons directing
the respondents to disclose their assets was even not complied with for
a period of approximately two years. This demonstrates the intention
and the conduct on the part of the respondents to disregard and disrespect
the orders passed by the High Court.
H
1164 SUPREME COURT REPORTS [2022] 3 S.C.R.
A 9. Even otherwise, it is required to be noted that it is alleged that
there is a wilful disobedience and/or non-compliance of the order passed
by this Court dated 28.10.2021 passed in Miscellaneous Application No.
1668 of 2021 in Special Leave Petition (C) No. 14724 of 2021, which is
reproduced hereinabove.
B 10. After the present contempt proceedings were initiated and
the respondents were served with notice in the present proceedings the
respondents thereafter filed Miscellaneous Application No. 61 of 2022
to recall the order dated 28.10.2021 in Miscellaneous Application No.
1668 of 2021 in Special Leave Petition (C) No. 14724 of 2021. The very
submissions, which are now made were made at the time of hearing of
C the Miscellaneous Application No. 61 of 2022 and by a detailed order
dated 25.01.2022, this Court dismissed the said application. The order
passed in Miscellaneous Application No. 61 of 2022 is reproduced
hereinbelow:-
“1. The present miscellaneous application has been preferred by
D the applicants – original petitioners with a prayer to recall order
dated 28.10.2021 passed in Miscellaneous Application No. 1668
of 2021.
2. Shri Shyam Divan, learned Senior Advocate has appeared on
behalf of the applicants and Shri Jayant Bhushan, learned Senior
E Advocate has appeared on behalf of the contesting respondent.
2.1 Shri Shyam Divan, learned Senior Advocate appearing on behalf
of the applicants has made the following submissions in support
of his prayer to recall order dated 28.10.2021 passed in M.A. No.
1668/2021:
F
i) that Miscellaneous Application No. 1668/2021 itself was not
maintainable as the same was filed in a disposed of matter;
ii) that no notice was issued to the applicants, i.e., the original
petitioners in Miscellaneous Application No. 1668/2021 and that
no reply was filed on behalf of the applicants; and
G
iii) in a special leave petition filed by the applicants, such a direction
could not have been issued by this Court as passed vide order
dated 28.10.2021. It is submitted, assuming that the applicants
had not complied with the order passed by the High Court dated
08.08.2019, which was impugned before this Court, and the
H
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1165
JAIN AND ANR. [M. R. SHAH, J.]
amount was not deposited even within the extended period of A
time, as extended by this Court, in that case, the only consequence
would be that there was no stay of the arbitral award and that the
execution proceedings are to be proceeded further. Therefore,
the direction issued in order dated 28.10.2021 directing the
applicants – original petitioners to deposit the amount to be
B
deposited as per the order of the High Court positively and within
the time granted by this Court and non-compliance of the same
shall be treated very seriously and non- deposit of the amount as
directed by the High Court in the impugned order shall be treated
as noncompliance of our order also having a serious consequences,
was not at all warranted and/or such an order could not have C
been passed.
3. We have heard Shri Shyam Divan, learned Senior Advocate
appearing on behalf of the applicants at length.
At the outset, it is required to be noted that when this Court
passed order dated 28.10.2021, Shri Kunal Vajani, learned D
advocate appeared on behalf of the applicants – original petitioners
and this Court passed order dated 28.10.2021 after hearing the
learned counsel appeared on behalf of the applicants – original
petitioners. A copy of M.A. No. 1668/2021 was served upon the
counsel and thereafter he appeared and after hearing Shri Kunal E
Vajani, learned advocate who appeared on behalf of the applicants,
this Court passed order dated 28.10.2021. At that time, neither
any request was made to adjourn the matter so as to enable the
applicants to file reply nor any objection was raised with respect
to non-maintainability of M.A. No. 1668/2021. Therefore, now it
is not open for the applicants to make a grievance with respect to F
non- maintainability of M.A. No. 1668/2021 and/or that no notice
was issued.
4. Even otherwise, it is required to be noted that the present
application is nothing but an afterthought and only with a view to
get out the contempt proceedings initiated by the respondent by G
way of Contempt Petition No. 940/2021. It is to be noted that
order dated 28.10.2021 was passed in the presence of the learned
counsel appearing on behalf of the applicants. Learned counsel
who appeared on behalf of the applicants was heard. The present
application to recall order dated 28.10.2021 has been preferred H
1166 SUPREME COURT REPORTS [2022] 3 S.C.R.
A after a period of almost two and a half months, i.e., on 17.01.2022
and that too after this Court issued notice in the contempt
proceedings and after the notice of contempt petition was served
upon the applicants. Therefore, the present application is, as such,
nothing but an afterthought and only with a view to get out the
contempt proceedings, which have been initiated and filed as far
B
back as on 18.11.2021 and notice was issued on 10.12.2021.
5. Even otherwise on merits also, order dated 28.10.2021 passed
in M.A. No. 1668/2021 is not required to be recalled. It is to be
noted that the special leave petition was arising out of the order
passed by the High Court of Judicature at Bombay dated
C 08.08.2019 in Notice of Motion No.960/2019 in Commercial
Arbitration Petition No. 55/2019. Notice of motion was made
absolute in terms of the prayer clause (a) on the condition that the
applicants herein shall deposit 50% of the awarded sum within
twelve weeks from 08.08.2019. Time granted by the High Court
D was extended from time to time at the instance of the applicants
herein but the applicants did not deposit the amount and prolonged
the matter and even the execution of the award. That thereafter
after getting extensions the applicants did not deposit the amount,
belatedly, the applicants preferred the present special leave petition
before this Court on 20.08.2021 with delay. Still, this Court
E condoned the delay ex-parte and granted further eight weeks’
time from 17.09.2021 to comply with the order passed by the
High Court dated 08.08.2019, as prayed by the learned counsel
appeared on behalf of the applicants.
6. As order dated 17.09.2021 was passed ex-parte and without
F notice to the respondent, respondent preferred M.A. No. 1668/
2021 to recall order dated 17.09.2021 contending, inter alia, that
all attempts are made on behalf of the applicants to delay the
execution and even further eight weeks’ time was sought only to
kill the time and there is no intention to deposit the amount and/or
G comply with order dated 08.08.2019 passed by the High Court.
Therefore, having heard learned counsel for the respective parties
and considering the apprehensions on behalf of the respondent
that extension of time is sought only to kill the time and delay the
matter further and there is no intention to comply with order dated
08.08.2019 and that the applicants though sufficient indulgence
H
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1167
JAIN AND ANR. [M. R. SHAH, J.]
have been shown by way of extension of time by the High Court, A
the amount has not been deposited and therefore in the peculiar
facts and circumstances of the case, we passed the order dated
28.10.2021. Therefore, when order dated 28.10.2021 was passed
in the peculiar facts and circumstances of the case, the same is
not required to be recalled, which was passed after hearing the
B
learned counsel appearing on behalf of the applicants also.
7. At this stage, it is required to be noted that even after order
dated 17.09.2021, by which a further eight weeks’ time was
granted, the original petitioners – applicants herein have not
complied with the order passed by the High Court for which they
sought extension. This shows the conduct on the part of the C
applicants. Even thereafter, there is no application for extension
of time.
Having taken the advantage/benefit of order dated
17.09.2021 of extension of time to comply with the order passed
by the High Court, thereafter it would not be open for the applicants D
to contend that on noncompliance the necessary consequence
under the Arbitration Act may follow and the execution proceedings
may have to be proceeded further. Be that as it may, when order
dated 28.10.2021 has been passed after hearing the learned counsel
for both the parties and as observed hereinabove on considering E
the apprehensions on the part of the respondent that the applicants
have no intention to comply with the order passed by the High
Court and they just want to delay the proceedings, order dated
28.10.2021 has been passed. Therefore, no case is made out to
recall order dated 28.10.2021 passed in M.A. No. 1668/2021.
8. In view of the above and for the reasons stated above, the F
present application stands dismissed.”
11. Therefore, once Miscellaneous Application No. 61 of 2022 to
recall the order dated 28.10.2021 in Miscellaneous Application No. 1668
of 2021 is dismissed, the respondents had to comply with the order dated
28.10.2021 passed in Miscellaneous Application No. 1668 of 2021. Even G
otherwise, the respondents were required to comply with order dated
28.10.2021.
12. Despite there being a specific direction issued by this Court in
the order dated 28.10.2021 directing the respondents to comply with and
deposit the amount to be deposited as per the order passed by the High H
1168 SUPREME COURT REPORTS [2022] 3 S.C.R.
A Court dated 08.08.2019 positively and within the time granted by this
Court by order dated 17.09.2021 in Special Leave Petition (C) No. 14724
of 2021, the respondents have the audacity to submit before this Court
that no direction has been issued by this Court in the order dated
28.10.2021. At this stage, it is required to be noted that even in the
Miscellaneous Application No. 61 of 2022, it was the specific case on
B
behalf of the respondents herein that by virtue of the order dated
28.10.2021, the condition of deposit has been converted into a mandatory
direction of this Court. Therefore, it was the specific case on behalf of
the respondents that the order dated 28.10.2021 is a mandatory direction
and therefore it was prayed to recall the order dated 28.10.2021. Then,
C how thereafter the respondents can be permitted to say that the order
dated 28.10.2021 is not a mandatory direction? By taking such a stand
as such the respondents have aggravated the contempt and their
contumacious conduct.
13. In the order dated 28.10.2021, there is a specific direction
D issued by this Court directing the respondents herein – original petitioners
in special leave petition to comply with and deposit the amount to be
deposited as per the order passed by the High Court positively and within
the time granted by this Court (eight weeks) as mentioned in the order
dated 17.09.2021. Moreover, it was specifically observed by this Court
that non-compliance of the said order shall be treated very seriously and
E non-deposit of the amount as directed by the High Court shall be treated
as non-compliance of the order of this Court and also having a serious
consequence. Despite the above, even the order dated 28.10.2021 in
Miscellaneous Application No. 1668 of 2021 has not been complied with
by the respondents. On the contrary, despite the specific direction issued
F in the order dated 28.10.2021 and the dismissal of Miscellaneous
Application No. 61 of 2022 vide order dated 25.01.2022, the respondents
have continued to their abrasive attitude of non-compliance and
disobedience and by making the same submissions, which were made
earlier which as such were rejected by a detailed order. Despite the
direction/order passed by this Court in the order dated 28.10.2021 in
G Miscellaneous Application No. 1668 of 2021, there is a disobedience/
non- compliance of the same and in that view of the matter, the decisions
relied upon by Shri Shyam Divan, learned Senior Advocate appearing on
behalf of the respondents on the alternative remedy available in the form
of execution etc. are not of any assistance nor applicable having regard
H to the facts of the case on hand.
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1169
JAIN AND ANR. [M. R. SHAH, J.]
13.1 In order to buttress his contention that non-compliance with A
the condition of deposit would only render the Arbitrator’s Award
enforceable and contempt proceedings ought not to have been initiated
for non-compliance with such condition which was not mandatory in
nature, learned senior counsel appearing on behalf of the respondent-
contemnor cited the following case law:
B
i) Sudhir Vasudeva vs. M. George Ravishekaran – [(2014)
3 SCC 373] wherein, this Court observed that a Court
exercising jurisdiction under the Contempt of Courts Act,
1971 must not travel beyond the four corners of the order
in relation to which contempt has been alleged. That the
Court hearing a contempt petition ought to restrict the scope C
of its inquiry to such directions which are explicit in the
judgment or order of which contempt has been alleged.
We are of the view that this judgment would not, in any
way, come to the aid of the respondent-contemnors because,
in whatever manner the orders of which contempt is alleged, D
are viewed, the orders state in unequivocal terms that the
contemnor is required to deposit the amount, within such
period as specified in the respective orders. The scope of
contempt, however narrow, would enable this Court to
invoke jurisdiction under the Act to redress a situation such E
as the instant one, wherein the orders of which contempt
has alleged, expressly and clearly record that the contemnor
was required to deposit the amounts specified therein. This
direction under the orders, could not be interpret in any
other manner.
F
ii) R.N. Dey & Ors. vs. Bhagyabati Pramanik & Ors. –
[(2000) 4 SCC 400] wherein this Court held that the
weapon of initiating contempt proceedings could not be used
for execution of a decree or implementation of an order.
That is, a Court should not invoke contempt jurisdiction,
where alternate remedies are available to secure the terms G
of an order.
We are mindful of the fact that contempt proceedings should not
be of the nature of ‘execution proceedings in disguise.’ However, we
hold that the case law cited supra would not come to the aid of the
H
1170 SUPREME COURT REPORTS [2022] 3 S.C.R.
A contemnor herein as the facts of the said case were significantly different
from the case at hand. In the said case, no stay was operating on the
decree of which contempt was alleged. Therefore, the decree-holder
therein could very well initiate execution proceedings. However, in the
instant case, the High Court, by order dated 08th August, 2019 stayed
the Award subject to the deposit of an amount. The time period of such
B
deposit has been extended by this Court on two occasions while continuing
the order of stay by implication. Having taken the advantage of the
extended time period, the respondent-contemnor cannot, at this juncture,
take the plea that non-compliance with the condition of deposit would
only render the Arbitrator’s Award enforceable and that such failure to
C comply would have no consequences under the Contempt of Courts
Act, 1971.
13.2 Further, it is trite law that the jurisdiction of a Court under the
Act, would not cease, merely because the order or decree of which
contempt is alleged, is executable under law, even without having recourse
D to contempt proceedings.
13.3 Contempt jurisdiction could be invoked in every case where
the conduct of a contemnor is such as would interfere with the due
course of justice; vide Rama Narang vs. Ramesh Narang – [(2006)
11 SCC 114. Contempt is a matter which is between the Court passing
E the order of which contempt is alleged and the contemnor; questions as
to executability of such order is a question which concerns the parties
inter-se. The power of the Court to invoke contempt jurisdiction, is not,
in any way, altered by the rights of the parties inter-se vide Bank of
Baroda vs. Sadruddin Hasan Daya – [(2004) 1 SCC 360].
F 14. Now, so far as the case on behalf of the respondents that
there is no wilful disobedience and because of the financial constraint,
the respondents are not in a position to deposit the amount as ordered by
the High Court vide order dated 08.08.2019 and the order passed by this
Court is concerned, the same is nothing but an afterthought. At no point
of time earlier, such a plea was taken. In the facts and circumstances of
G the case, such a stand now lacks bonafides. All efforts are being made
by the respondents to get out of the order passed by the High Court
dated 08.08.2019 and the order passed by this Court dated 28.10.2021 in
Miscellaneous Application No. 1668 of 2021 in Special Leave Petition
(C) No. 14724 of 2021. If the bonafides of the respondents were clear
H and they genuinely wanted to abide by the order passed by the High
URBAN INFRASTRUCTURE REAL ESTATE FUND v. DHARMESH S. 1171
JAIN AND ANR. [M. R. SHAH, J.]
court and this Court, but could not deposit because of the financial A
difficulties, in that case, they ought to have straightaway pleaded their
financial difficulties and ought not to have taken the stand, which was
taken in Miscellaneous Application No. 61 of 2022 and even which are
once again taken now.
As observed hereinabove, even the respondents disclosed their B
assets after a period of approximately two years from the date of the
passing of the order passed by the High Court in Chamber Summons.
Therefore, we are of the opinion that the stand taken by the respondents
now that they are not in a position to deposit the amount and/or comply
with the order passed by the High Court and this Court because of the
financial difficulties and therefore there is no wilful disobedience by the C
respondents in not complying with the order passed by the High Court
dated 08.08.2019 and the order passed by this Court dated 28.10.2021 in
Miscellaneous Application No. 1668 of 2021 in Special Leave Petition
(C) No. 14724 of 2021 lacks bonafides and the same is not at all
acceptable by us. D
15. When a party which is required to comply with the terms or
directions in an order has not done so within such time as stipulated in
the order, two options are available to the party which was required to
comply with such order: (a) give an explanation to the Court as to the
circumstances due to which the party could not comply with the order of E
the Court; (b) seek for further time to comply with the order of the
Court. If a delay has occurred in complying with the terms of an order
and the party which was to comply with the order has not resorted to
either of the two aforestated options, then, the party responsible for
delay in compliance, may be held to have committed contempt; vide
State of Bihar vs. Subhash Singh - [(1997) 4 SCC 430] F
15.1 Further, the decision of this Court in Maruti Udyog vs.
Mahinder C. Mehta – AIR 2008 SC 309 suggests that irrespective of
whether or not a decree is executable, the question to be considered by
this Court in determining whether a case for contempt has been made
out was, whether, the conduct of the contemnor was such as would G
make a fit case for awarding punishment for contempt of Court.
16. Applying the legal propositions discussed supra, to the facts
of the case at hand, we are of the view that the conduct of the respondent-
contemnors is such as would justify invocation of contempt jurisdiction
H
1172 SUPREME COURT REPORTS [2022] 3 S.C.R.
A of this Court. Not only have the contemnors unreasonably delayed and
defaulted in compliance of the orders of this Court without explaining
the cause for such default, or seeking extension of time for compliance;
but they have also sought to avoid compliance of the order, even after
taking benefit of the extended time period granted for compliance of the
same. The contemnors cannot, at this juncture, claim that the requirement
B
of deposit was not mandatory, but directory and therefore non-compliance
thereof would not constitute contempt.
17. In view of the above and for the reasons stated above, we are
of the firm view that the respondents have willfully disobeyed the order
passed by the High Court dated 08.08.2019 in Notice of Motion No. 960
C of 2019 in Commercial Arbitration Petition No. 55 of 2019 and have
willfully disobeyed the order dated 28.10.2021 passed by this Court in
Miscellaneous Application No. 1668 of 2021 in Special Leave Petition
(C) No. 14724 of 2021 and thereby the respondents are guilty of civil
contempt and have rendered themselves liable for suitable punishment
D under the provisions of Contempt of Courts Act. The respondents, more
particularly, respondent No.1, is hereby held guilty for the contempt of
this Court for wilful disobedience of the order passed by the High Court
dated 08.08.2019 in Notice of Motion No. 960 of 2019 in Commercial
Arbitration Petition No. 55 of 2019 and specifically for disobedience of
the order dated 28.10.2021 passed by this Court in Miscellaneous
E Application No. 1668 of 2021 in Special Leave Petition (C) No. 14724
of 2021 and are held liable to be punished suitably under the provisions
of the Contempt of Courts Act. Now, the respondents shall be heard on
sentence.
F Bibhuti Bhushan Bose Contempt Petition disposed of.
(Assisted by : Neha Sharma, LCRA)
G
H
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