SCI (2024.12.13) in Celir LLP Vs. Mr. Sumati Prasad Bafna and Ors. [(2024) ibclaw.in 319 SC, 2024 INSC 978, Contempt Petition (C) Nos. 158-159 of 2024 in Civil Appeal Nos. 5542-5543 of 2023 with M.A. Nos. 600-601 of 2024 in Civil Appeal Nos. 5542-5543 of 2023] held that;
The contemptuous act complained of must be such that would result in obstruction of justice, adversely affect the majesty of law and impact the dignity of the courts of law
Any act of disobedience, defiance, or any attempt to malign the authority of the court would amount to contempt because they undermine the respect and trust that the public reposes in judicial institutions.
Acts that attempt to mislead the court, obstruct its functioning or frustrate its decisions distort the process of justice and would amount to contempt.
Even in the absence of such specific mandates, the deliberate conduct of parties aimed at frustrating court proceedings or circumventing its eventual decision may amount to contempt.
Any contumacious conduct of the parties to bypass or nullify the decision of the court or render it ineffective, or to frustrate the proceedings of the court, or to enure any undue advantage therefrom would amount to contempt.
Excerpts of the Order;
iii. Whether any contempt is said to have been committed by the respondents herein?
# 182. In order to decide whether the appellants are guilty of civil contempt, it would be apposite to refer to Section 2(b) of the Act, 1971, which reads as under: –
“2. Definitions.—
In this Act, unless the context otherwise requires,—
xxx xxx xxx
(b) “civil contempt” means wilful disobedience to any judgment, decree, direction, order, writ or other process of a court or wilful breach of an undertaking given to a court;”
# 183. The Black’s Law Dictionary, Sixth Edition, at page 1599, defines “willful” as hereunder:
“Proceeding from a conscious motion of the will; voluntary; knowingly; deliberate. Intending the result which actually comes to pass; designed; intentional; purposeful; not accidental or involuntary. Premeditated; malicious; done with evil intent, or with a bad motive or purpose, or with indifference to the natural consequences; unlawful; without legal justification. An act or omission is “willfully” done, if done voluntarily and intentionally and with the specific intent to do something the law forbids, or with the specific intent to fail to do something the law requires to be done; that is to say, with bad purpose either to disobey or to disregard the law. It is a word of many meanings, with its construction often influenced by its context. In civil actions, the word (willfully) often denotes an act which is intentional, or knowing, or voluntary, as distinguished from accidental. But when used in a criminal context it generally means an act done with a bad purpose; without justifiable excuse; stubbornly, obstinately, perversely.”
# 184. In Ashok Paper Kamgar Union v. Dharam Godha and Ors. reported in (2003) 11 SCC 1, the expression ‘wilful disobedience’ in the context of Section 2(b) of the Act, 1971 was read to mean an act or omission done voluntarily and intentionally with the specific intent to do something, which the law forbids or with the specific intention to fail to do something which the law requires to be done. Wilfulness signifies deliberate action done with evil intent and bad motive and purpose. It should not be an act, which requires and is dependent upon, either wholly or partly, any act or omission by a third party for compliance.
# 185. Hence, the expression or word “wilful” means act or omission which is done voluntarily or intentionally and with the specific intent to do something which the law forbids or with the specific intent to fail to do something the law requires to be done, that is to say with bad purpose either to disobey or to disregard the law. It signifies a deliberate action done with evil intent or with a bad motive or purpose.
# 186. Article 129 of the Constitution declares this Court as a “a court of record” and states that it shall have all the powers of such a court including the power to punish for contempt of itself. The provisions of the Act, 1971 and the Rules framed thereunder form a part of a special statutory jurisdiction that is vested in courts to punish an offending party for its contemptuous conduct. It needs no emphasis that the power of contempt ought to be exercised sparingly with great care and caution. The contemptuous act complained of must be such that would result in obstruction of justice, adversely affect the majesty of law and impact the dignity of the courts of law.
# 187. It must also be understood that contempt proceedings are sui generis inasmuch as the Law of Evidence and the Code of Criminal Procedure, 1973 are not to be strictly applied. At the same time, the procedure adopted during the contempt proceedings must be fair and just that is to say the principles governing the Rule of law must be extended to the party against whom contempt proceedings have been initiated. The party must have every opportunity to place its position before the Court. Such a party must not be left unheard under any circumstances.
# 188. In Ram Kishan v. Tarun Bajaj & Ors. reported in (2014) 16 SCC 204 it was held that the contempt jurisdiction conferred on to the law courts power to punish an offender not only for his wilful disobedience but also for contumacious conduct or obstruction to the majesty of law. It further observed that such power has been conferred for the simple reason that the respect and authority commanded by the courts of law are the greatest guarantee to an ordinary citizen that his rights shall be protected and the entire democratic fabric of the society will crumble down if the respect of the judiciary is undermined. The relevant observations read as under: –
“11. The contempt jurisdiction conferred on to the law courts power punish an offender for his wilful disobedience/contumacious conduct or obstruction to the majesty of law, for the reason that respect and authority commanded by the courts of law are the greatest guarantee to an ordinary citizen that his rights shall be protected and the entire democratic fabric of the society will crumble down if the respect of the judiciary is undermined. Undoubtedly, the contempt jurisdiction is a powerful weapon in the hands of the courts of law but that by itself operates as a string of caution and unless, thus, otherwise satisfied beyond reasonable doubt, it would neither be fair nor reasonable for the law courts to exercise jurisdiction under the Act. The proceedings are quasi criminal in nature, and therefore, standard of proof required in these proceedings is beyond all reasonable doubt. It would rather be hazardous to impose sentence for contempt on the authorities in exercise of the contempt jurisdiction on mere probabilities. […]” (Emphasis supplied)
# 189. In Murray & Co. v. Ashok Kr. Newatia & Anr. reported in (2000) 2 SCC 367 this Court held that the purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law since the image of such a majesty in the minds of the people cannot be led to be distorted, as any indulgence which can even remotely be termed to affect the majesty of law would result in the society losing its confidence and faith in the judiciary and the law courts forfeiting the trust and confidence of the people in general. The relevant observations read as under: –
“9 […] The purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law since the image of such a majesty in the minds of the people cannot be led to be distorted.The respect and authority commanded by courts of law are the greatest guarantee to an ordinary citizen and the entire democratic fabric of the society will crumble down if the respect for the judiciary is undermined. It is true that the judiciary will be judged by the people for what the judiciary does,but in the event of any indulgence which can even remotely be termed to affect the majesty of law, the society is bound to lose confidence and faith in the judiciary and the law courts thus, would forfeit the trust and confidence of the people in general.” (Emphasis supplied)
# 190. In Pushpaben & Anr. v. Narandas Badiani & Anr. reported in (1979) 2 SCC 394, it was held that contempt of court is a special jurisdiction to be exercised sparingly and with caution whenever an act adversely affects the administration of justice or which tends to impede its course or tends to shake public confidence in the judicial institutions. It further held that this jurisdiction is to be exercised not for the protection of the dignity of an individual judge but to protect the administration of justice from being maligned and ensure that the authority of the courts is neither imperilled nor is the administration of justice by it interfered with in any manner. The relevant observations read as under: –
“42. The contempt of court is a special jurisdiction to be exercised sparingly and with caution whenever an act adversely affects the administration of justice or which tends to impede its course or tends to shake public confidence in the judicial institutions. This jurisdiction may also be exercised when the act complained of adversely affects the majesty of law or dignity of the courts. The purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law. It is an unusual type of jurisdiction combining “the jury, the judge and the hangman” and it is so because the court is not adjudicating upon any claim between litigating parties. This jurisdiction is not exercised to protect the dignity of an individual judge but to protect the administration of justice from being maligned. In the general interest of the community it is imperative that the authority of courts should not be imperilled and there should be no unjustifiable interference in the administration of justice. It is a matter between the court and the contemner and third parties cannot intervene. It is exercised in a summary manner in aid of the administration of justice, the majesty of law and the dignity of the courts. No such act can be permitted which may have the tendency to shake the public confidence in the fairness and impartiality of the administration of justice.” ‘ (Emphasis supplied)
# 191. In Reliance Petrochemicals Ltd. v. Proprietors of Indian Express Newspapers, Bombay Pvt. Ltd. & Ors. reported in (1988) 4 SCC 592 it was observed that the process of due course of administration of justice must remain unimpaired. Public interest demands that there should be no interference with judicial process and the effect of the judicial decision should not be pre-empted or circumvented. The relevant observations read as under: –
“35. The question of contempt must be judged in a particular situation. The process of due course of administration of justice must remain unimpaired. Public interest demands that there should be no interference with judicial process and the effect of the judicial decision should not be pre-empted or circumvented by public agitation or publications. It has to be remembered that even at turbulent times through which the developing countries are passing, contempt of court means interference with the due administration of justice.” (Emphasis supplied)
# 192. In Rita Markandey v. Surjit Singh Arora reported in (1996) 6 SCC 14, it was observed that even if parties have not filed an undertaking before the court but if the court was induced to sanction a particular course of action or inaction on the representation made by a party and the court ultimately finds that the party never intended to act on the said representation or such representation was false, the party would be guilty of committing contempt. The relevant observations read as under: –
“12. Law is well settled that if any party gives an undertaking to the court to vacate the premises from which he is liable to be evicted under the orders of the court and there is a clear and deliberate breach thereof it amounts to civil contempt but since, in the present case, the respondent did not file any undertaking as envisaged in the order of this Court the question of his being punished for breach thereof does not arise. However, in our considered view even in a case where no such undertaking is given, a party to a litigation may be held liable for such contempt if the court is induced to sanction a particular course of action or inaction on the basis of the representation of such a party and the court ultimately finds that the party never intended to act on such representation or such representation was false. In other words, if on the representation of the respondent herein the Court was persuaded to pass the order dated 5-10-1995 extending the time for vacation of the suit premises, he may be held guilty of contempt of court, notwithstanding non-furnishing of the undertaking, if it is found that the representation was false and the respondent never intended to act upon it. […]” (Emphasis supplied)
# 193. The Borrower and the Subsequent Transferee / the alleged contemnors herein placing reliance on the decision of this Court in Patel Rajnikant (supra) have contended that in the absence of any disobedience or wilful breach of a prohibitory order no contempt could be said to have been committed. It has been further canvased that this Court in the Main Appeals never issued any specific direction either to the Borrower or the Subsequent Transferee, & therefore no contempt could be said to have been committed.
# 194. In Patel Rajnikant (supra) this Court upon examining Section 2(b) of the Act, 1971 held that to hold a person guilty of having committed contempt, there must be a judgment, order, direction etc. by a court, there must be disobedience of such judgment, order, direction etc and that such disobedience must be willful. The relevant provisions read as under: –
“58. The provisions of the Contempt of Courts Act, 1971 have also been invoked. Section 2 of the Act is a definition clause. Clause (a) enacts that contempt of court means “civil contempt or criminal contempt”. Clause (b) defines “civil contempt” thus:
“2. (b) ‘civil contempt’ means wilful disobedience to any judgment, decree, direction, order, writ or other process of a court or wilful breach of an undertaking given to a court;”
Reading of the above clause makes it clear that the following conditions must be satisfied before a person can be held to have committed a civil contempt:
(i) there must be a judgment, decree, direction, order, writ or other process of a court (or an undertaking given to a court);
(ii) there must be disobedience to such judgment, decree, direction, order, writ or other process of a court (or breach of undertaking given to a court); and
(iii) such disobedience of judgment, decree, direction, order, writ or other process of a court (or breach of undertaking) must be wilful.”
195. However, the subsequent observations made by this Court in Patel Rajnikant (supra) are significant. It observed that the court should not hesitate in wielding the potent weapon of contempt, it is for the proper administration of justice and to ensure due compliance with the orders passed by it in order to uphold and maintain the dignity of courts and majesty of law. The relevant observations read as under: –
“70. From the above decisions, it is clear that punishing a person for contempt of court is indeed a drastic step and normally such action should not be taken. At the same time, however, it is not only the power but the duty of the court to uphold and maintain the dignity of courts and majesty of law which may call for such extreme step. If for proper administration of justice and to ensure due compliance with the orders passed by a court, it is required to take strict view under the Act, it should not hesitate in wielding the potent weapon of contempt.” (Emphasis supplied)
# 196. What can be discerned from the above exposition of law is that any act of disobedience, defiance, or any attempt to malign the authority of the court would amount to contempt because they undermine the respect and trust that the public reposes in judicial institutions. The judicial process relies on the confidence of society, and any act that disrupts or disrespects this process threatens to erode the foundation of justice and order.
# 197. Contempt jurisdiction exists to preserve the majesty and sanctity of the law. Courts are the guardians of justice, and their decisions must command respect and compliance to ensure the proper functioning of society. When individuals or entities challenge the authority of courts through wilful disobedience or obstructive behaviour, they undermine the rule of law and create the risk of anarchy. Contempt serves as a mechanism to protect the integrity of the courts, ensuring that they remain a symbol of fairness, impartiality, and accountability.
# 198. When judicial orders are openly flouted or court proceedings are disrespected, it sends a signal that the rule of law is ineffective, leading to a loss of trust in the system. Judicial decisions must remain unimpaired, free from external pressures, manipulation, or circumvention. Acts that attempt to mislead the court, obstruct its functioning or frustrate its decisions distort the process of justice and would amount to contempt.
# 199. The contempt jurisdiction of this court cannot be construed by any formulaic or rigid approach. Merely because there is no prohibitory order or no specific direction issued the same would not mean that the parties cannot be held guilty of contempt. The Contempt jurisdiction of the court extends beyond the mere direct disobedience of explicit orders or prohibitory directions issued by the court. Even in the absence of such specific mandates, the deliberate conduct of parties aimed at frustrating court proceedings or circumventing its eventual decision may amount to contempt. This is because such actions strike at the heart of the judicial process, undermining its authority and obstructing its ability to deliver justice effectively. The authority of courts must be respected not only in the letter of their orders but also in the broader spirit of the proceedings before them.
# 200. Any contumacious conduct of the parties to bypass or nullify the decision of the court or render it ineffective, or to frustrate the proceedings of the court, or to enure any undue advantage therefrom would amount to contempt. Attempts to sidestep the court’s jurisdiction or manipulate the course of litigation through dishonest or obstructive conduct or malign or distort the decision of the courts would inevitably tantamount to contempt sans any prohibitory order or direction to such effect.
# 201. Thus, the mere conduct of parties aimed at frustrating the court proceedings or circumventing its decisions, even without an explicit prohibitory order, constitutes contempt. Such actions interfere with the administration of justice, undermine the respect and authority of the judiciary, and threaten the rule of law.
# 202. However, at the same time, the power of contempt ought to be exercised sparingly and with caution and care. It operates with a string of caution and unless otherwise satisfied beyond doubt, it would neither be fair nor reasonable for the courts to resort to such powers. The standard of proof required before a person is held guilty of committing contempt of court must be beyond all reasonable doubt.
# 203. The courts while exercising its contempt jurisdiction must remain circumspect, more particularly, where there exists a possibility of the order being amenable to more than one interpretation. In Jhareshwar Prasad Paul v. Tarak Nath Ganguly reported in (2002) 5 SCC 352 it was held that if an order does not contain any specific direction regarding a matter or if there is any ambiguity in the directions issued therein then it would be appropriate to direct the parties to approach the court which disposed of the matter for necessary clarification of the order instead of the court exercising its contempt jurisdiction thereby taking upon itself the power to decide the original proceeding in a manner not dealt with by the court passing the judgment or order. The relevant observations read as under: –
“The contempt jurisdiction should be confined to the question whether there has been any deliberate disobedience of the order of the court and if the conduct of the party who is alleged to have committed such disobedience is contumacious. The court exercising contempt jurisdiction is not entitled to enter into questions which have not been dealt with and decided in the judgment or order… The court has to consider the direction issued in the judgment or order and not to consider the question as to what the judgment or order should have contained. At the cost of repetition, be it stated here that the court exercising contempt jurisdiction is primarily concerned with the question of contumacious conduct of the party, which is alleged to have committed deliberate default in complying with the directions in the judgment or order. If the judgment or order does not contain any specific direction regarding a matter or if there is any ambiguity in the directions issued therein then it will be better to direct the parties to approach the court which disposed of the matter for clarification of the order instead of the court exercising contempt jurisdiction taking upon itself the power to decide the original proceeding in a manner not dealt with by the court passing the judgment or order.” (Emphasis supplied)
# 204. It is true that this Court in its decision rendered in the Main Appeals had not issued any specific direction either to the Borrower or the Subsequent Transferee as regards the handing over of physical possession and the original title deed to the Secured Asset, or the proceedings pending before the DRT in S.A. No. 46 of 2022. However, the same would not mean that the decision of this Court in the Main Appeal was bereft of any direction as to the outcome of its findings. This Court in the operative portion of the Main Appeals stated in unequivocal terms that the confirmation of the sale by Bank under Rule 9(2) of the SARFAESI Rules had vested the petitioner herein with a right to obtain the certificate of sale of the Secured Asset. It further held categorically that the Borrower herein could not have redeemed the mortgage upon publication of the 9th auction notice. Furthermore, this Court explicitly directed the Bank to not only issue the Sale Certificate to the petitioner herein in accordance with Rule 9(6) of the SARFAESI Rules but also directed the refund of the amount of Rs. 129 crore paid by the Borrower. Moreover, the impugned order of the High Court had been set-aside by this Court in toto. As already discussed in paragraph 154, the natural corollary to the aforesaid was that the judgment and order dated 21.09.2023 of this Court in Civil Appeals Nos. 5542-5543 of 2023 had held as under: –
(i) The auction proceedings and the sale conducted thereto in favour of the petitioner herein pursuant to the 9th auction notice dated 12.06.2023 had been categorically affirmed and upheld.
(ii) After having directed the issuance of the Sale Certificate in terms of Rule 9(6) of the SARFAESI Rules, nothing remained thereafter, as issuance of sale certificate is absolute and as such the proceedings before the DRT had been rendered infructuous.
(iii) Having directed not only the issuance of the Sale Certificate to the Secured Asset but also the refund of the amount paid by the Borrower, towards redemption of mortgage, necessarily entailed that the Borrower was duty bound to return the possession and title deeds of the secured asset to the Bank for the purpose of handing the same over to the petitioner.
(iv) Having set aside the impugned order passed by the High Court in toto rendered any and all acts done pursuant thereto as null and void, and the Borrower and the Subsequent Transferee herein were required to get the Release Deed and the Assignment Agreement dated 28.08.2023 cancelled.
(v) Having expressly directed the issuance of the Sale Certificate it necessarily excluded all other inconsistent and contrary rights and reliefs including the right to pursue the DRT proceedings in view of the maxim Expressio Unius Est Exclusio Alterius.
# 205. Where a decision is rendered and the impugned order is set-aside, it behoves any logic that an express direction to act must be given in respect of every aspect of the decision. The parties are duty bound to act in accordance with common sense. It is axiomatic that a party should obey both the letter and the spirit of a court order, and it is neither open for the parties to adopt a myopic and blinkered view of such decision nor any such interpretation or view that sub-serves their own interests. It is ultimately the purpose for which the order was granted that will be the lodestar in guiding the parties as to the true effect of the order and determination of the court.
# 206. If at all the parties are in doubts over the judgment and order of a court, the correct approach is to prefer a miscellaneous application for seeking clarification rather than proceeding to presume a self-serving interpretation of the decision. At this stage, we may also explain the correct approach to be adopted by the other courts and forums where a party seeks to espouse a cause based on its own understanding or interpretation of a decision of an higher authority. In such situations, the courts or forums should neither aid the parties in their attempt to reinterpret the decision of a higher court nor should they embark on an inquisitorial exercise of their own in order to derive the scope or intent of the order in question. The courts and tribunals should not conflate a decision of a higher court that declares a law with a decision that declares the inter-se rights of a parties, the former only operates as a precedent and thus, it is open for the lower courts to apply their minds to assess whether the same is applicable to the issues before it or what law has been laid down therein. However, the latter not only has precedential value but also carries with it the weight of determination of the issues directly involved between the very parties before it, the subject-matter itself and by extension the entire cause of action. Since such decisions have directly decided or given a finding on the inter-se rights and issues of the same parties that are before it and as such has to a certain extent a direct and palpable effect on the cause of action before it, in such circumstances, the courts and tribunals should refrain from interpreting or examining the scope or effect of such decisions on their own as the same would amount to relitigating the very same issues and rather should relegate the parties to seek clarification from the court that passed the order and adjourn further proceedings sine die.
# 207. We further take note of the fact that both the Borrower and the Subsequent Transferee made several attempts to prevent the effective implementation of the judgement and order dated 21.09.2023 passed by this Court and thereby thwart the attempts of the Bank to hand over the physical possession and the original title deeds of the Secured Asset to the petitioner.
(i) First, both the Borrower and the Subsequent Transferee addressed a letter to the MIDC in whose industrial area the Secured Asset was situated asking them not to entertain any request from the Bank or the petitioner regarding the transfer of the leasehold rights of the Secured Asset in favour of the petitioner.
(ii) Secondly, the Subsequent Transferee vide its letter dated 05.10.2023 even asked the Sub-Registrar Office, Nerul Thane not to entertain any request of the petitioner regarding the transfer of the Secured Asset.
(iii) The self-serving stance of the Borrower to initially contend that it no longer had any role or authority over the secured asset in view of its transfer and thus, cannot handover the physical possession and the original title deeds to the same, yet in the same breath filing an application seeking stay of the notice for obtaining physical possession of the Secured Asset.
(iv) The police complaint lodged by the Subsequent Transferee against the Bank by distorting the decision of this Court in the Main Appeals and to thwart the attempts for its implementation.
(v) The patently false contention of the Subsequent Transferee that it instituted the suit to prevent its unlawful dispossession of the Secured Asset due to the alleged illegal attempts of the petitioner to take the same forcefully yet, in the said suit instead of seeking permanent injunction, the Subsequent Transferee not only sought the relief of declaration of title in its favour but also the invalidation of the Sale Certificate issued to the petitioner, contrary to the decision of this Court in the Main Appeals.
208. In the facts of the case, we are convinced that both the Borrower and the Subsequent Transferee have committed contempt of this Court’s judgment and order dated 21.09.2023 in the Main Appeals. The aforementioned acts of the contemnors are nothing more than a gamble on their part to circumvent and undermine the findings and directions passed by this Court in the Main Appeals. Similarly, the lame excuses offered by them for explaining their conduct are also nothing more than a calculated attempt in the hope that they would get away with legitimizing the illegal Assignment Agreement even after the decision of this Court, and is equally contemptuous.
# 209. However, on an overall conspectus of the facts of the present case, while the initial acts of the Borrower and the Subsequent Transferee are in violation of this Court’s judgment and order dated 21.09.2023, yet the efforts on their part to take steps and make amends by withdrawing the Special Civil Suit No. 5 of 2024 along with their belated unconditional undertaking to comply with any further order that this Court may deem fit and proper to pass, demonstrates their effort and willingness to purge themselves of their contemptuous conducts. Thus, we are inclined to provide one last opportunity to the Borrower herein and the Subsequent Transferee to abide by the judgement and order dated 21.09.2023 passed by this Court and further comply with the directions issued in the present contempt petition, and thus, deem it fit not to hold them guilty of contempt for the present moment.
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