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2025 (4) TMI 1530 - SC - Indian LawsContempt of Court - Non-payment of arrears of use and occupation charges for period between 20.09.2021 and 31.11.2022 in six monthly instalments - Respondent-Contemnor s plea of financial incapacity to comply with the Court s order is a valid defense against the charge of contempt or not - HELD THAT - All throughout the Respondent-Contemnor had been in possession of the said Property and had been utilising the income generated from running of the said resort. Acceptance on the part of the Respondent-Contemnor with regard to the viability of the project is apparent from the Order dated 07.11.2022 and his conduct. This would not permit the Respondent-Contemnor to now turn around and state that he is unable to make payment of not only the monthly dues for use and occupation charges after passing of the Order dated 07.11.2022 but also the arrears as per which terms and conditions were fixed by this Court in accordance with the prayer made by him. Non - fulfilment of the mandate and direction of this Court which were at the request of the Respondent-Contemnor himself reflects the intent on the part of the Respondent- Contemnor to not to comply with the order rather to violate with the same with impunity. The conduct clearly reflects that the intention of the Respondent-Contemnor was to gain the benefit by running the resort in the subject property without paying the current liability what to say of the arrears. The malafide is therefore writ large and reflect the misuse of the process of the Court. After seeking an order from this Court where benefit has been conferred on the basis of the submissions of the Respondent-Contemnor not complying therewith amounts to contempt of Court - The power and jurisdiction of this Court to initiate and punish for its contempt has not been disputed. It is well settled by now and it is apparent from the provisions of the Contempt of Court Act that Civil contempt means wilful Contempt Petition (C) No. 712 of 2023 Page 14 of 19 disobedience of judgment decree or direction order writ or other process of the Court or wilful breach of an undertaking given to the Court. A party misguiding the Court to pass an order which was never intended to be complied with would constitute an act of overawing the due process of law and thus commit contempt of Court. In the instant case the opportunity having been availed time having been sought and granted by the Court further reflects the intent on the part of the Respondent-Contemnor to discard and tarnish the judicial process by polluting it. Disobedience of the order of the Court in such circumstances would be the only result and thus civil contempt. The Respondent-Contemnor cannot be allowed to go scot free after having taken this Court at a stage where his conduct leaves this Court with no option but to take strict action and to punish him for the contempt committed by him i.e. non-compliance of the directions issued by this Court vide Order dated 07.11.2022. Shaji Augustine-Respondent is guilty of Civil Contempt and impose punishment of Simple Imprisonment for three months along with fine of INR 20, 000/- to be deposited in two weeks and in case of default further Simple Imprisonment for one month - Giving one more opportunity to the Respondent- Contemnor to purge the contempt 30 days time is granted to him to comply with the Order dated 07.11.2022 and submit compliance report to the Registrar Judicial of this Court a week thereafter. Conclusion - The Respondent-Contemnor is found guilty of civil contempt for wilful and deliberate disobedience of the Court s order dated 07.11.2022. The contempt proceedings are disposed of.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Court in this judgment include:
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Whether the Respondent-Contemnor's non-payment as per the Court's order constitutes civil contempt The legal framework governing civil contempt is primarily contained in Section 2(b) of the Contempt of Courts Act, 1971, which defines civil contempt as wilful disobedience of any judgment, decree, direction, order, writ, or other process of a court, or wilful breach of an undertaking given to the court. The Court reiterated the settled principle that civil contempt requires proof of wilful and deliberate disobedience. In the present case, the Court examined the factual matrix, including the Order dated 07.11.2022 directing the Respondent-Contemnor to pay arrears and monthly use and occupation charges amounting to INR 12 lakhs per month from 20.09.2021 onwards, with arrears payable in six monthly instalments starting 31.12.2022. Despite the Petitioner Association providing bank account details promptly, no payment was made by the Respondent-Contemnor, who continued to occupy and use the property. The Court found that the Respondent-Contemnor's conduct was a deliberate and wilful breach of the Court's order. The Respondent-Contemnor's failure to pay any amount, despite having the means to do so as evidenced by his communication seeking account details, demonstrated an intention to disregard the Court's directions. The Court rejected the plea of financial incapacity, noting the Respondent-Contemnor's ongoing use of the property and failure to account for income generated from it. The Court also emphasized that the Respondent-Contemnor did not seek modification or withdrawal of the order, which would have been the appropriate remedy if compliance was genuinely impossible. Instead, the conduct reflected an abuse of the judicial process and an attempt to reap benefits without fulfilling obligations. Thus, the Court concluded that the Respondent-Contemnor committed civil contempt by wilfully disobeying the order dated 07.11.2022. Issue 2: Validity of the Respondent-Contemnor's plea of financial incapacity as a defense against contempt The Respondent-Contemnor submitted an affidavit claiming inability to comply with the Court's order due to financial and physical incapacity. However, the Court scrutinized this claim against the backdrop of the Respondent-Contemnor's conduct, including the email dated 17.11.2022 requesting account details to transfer arrears, which implied liquidity and financial capability. The Court observed that if the Respondent-Contemnor was genuinely unable to comply, he should have approached the Court for modification or relief rather than defaulting silently. The Court found the plea of penury to be a post facto excuse lacking credibility, especially given the Respondent-Contemnor's continued occupation and commercial use of the property. Therefore, the Court held that financial incapacity was not a valid defense in this case, and the non-compliance was wilful and deliberate. Issue 3: Jurisdiction and discretion of the Supreme Court under Article 136 in the context of non-compliance The Court noted that the jurisdiction under Article 136 is discretionary and can be declined if the petitioner has not complied with the Court's directions. The main Petition was dismissed on 01.12.2023 due to the Respondent-Contemnor's failure to pay any amount as ordered. The Court kept the question of law open for consideration in an appropriate case but declined to entertain the petition in the facts of this case. This exercise of discretion underscored the principle that litigants must comply with Court orders to maintain the sanctity of judicial proceedings and that non-compliance can lead to dismissal of petitions irrespective of their merits. Issue 4: Appropriate punishment for wilful disobedience of Court's order The Court referred to authoritative precedents, including Hira Lal Dixit v. State of Uttar Pradesh and Bank of India v. Vijay Transport, highlighting that contempt powers are extraordinary and must be sparingly exercised but are essential to uphold the administration of justice and public confidence. The Court observed that the Respondent-Contemnor's conduct was a gross abuse of the judicial process, amounting to an attempt to mislead the Court and exploit procedural mechanisms for personal gain. The Court emphasized that mere imposition of a fine would be insufficient given the gravity of the contempt and the Respondent-Contemnor's contumacious attitude. Accordingly, the Court held the Respondent-Contemnor guilty of civil contempt and imposed a sentence of simple imprisonment for three months along with a fine of INR 20,000, with a further one month imprisonment in case of default. The Court also granted 30 days to purge the contempt by complying with the order and submitting a compliance report. Issue 5: Legal effect of the Settlement Agreement and consequences of default The Settlement Agreement, arrived at through mediation and incorporated into the High Court's order, reduced the license fees and arrears and contained a clause permitting either party to proceed in case of default. The Respondent-Contemnor's failure to pay as per the Settlement Agreement and subsequent Court orders led to execution proceedings and orders for delivery of possession. The Court underscored that the Settlement Agreement attained finality and was binding. The Respondent-Contemnor's persistent litigation and non-compliance were viewed as attempts to evade obligations and retain possession unlawfully. Issue 6: Misuse of judicial process and its impact on contempt proceedings The Court highlighted that misuse of the Court's process, including misleading the Court and abusing procedural rights, can constitute contempt. The Respondent-Contemnor's conduct was found to be a clear example of such misuse, as he sought and obtained interim orders on the basis of submissions that were not intended to be complied with. The Court emphasized the importance of maintaining the purity of the administration of justice and protecting public interest by ensuring that judicial orders are respected and enforced. The Court cited recent authoritative pronouncements underscoring that contempt powers are vital to safeguard judicial authority and the rule of law. 3. SIGNIFICANT HOLDINGS "The Respondent-Contemnor has deliberately and with malafide intention, not only mislead and misused the process of the courts but has also intentionally violated the order passed by this Court on 07.11.2022 by not making the payment as directed therein." "Civil contempt means a wilful disobedience of any judgment, direction or order passed by the Court. All through, as has been detailed above, the intention on the part of the Respondent-Contemnor was to use the judicial proceedings for his advantage taking undue benefit at the peril and cost of wrong assertions and submissions put forth before the Court which would amount to misleading the Court into believing the bonafide at the hands of the Respondent-Contemnor." "Any person who misuses the process of the Court with ulterior motives cannot be said to be a person having approached the Court with clean hands. A person who tries to tarnish the process of litigation to the extent of misguiding and misleading the proceedings before the Court resulting in passing of order(s) which are to his benefit at the cost of the loss of dignity, leading to shrinkage of the faith of the common man in the judicial process cannot be permitted." "Disregarding a Court's order may seem bold, but the shadows of its consequences are long and cold." "Contempt of court is a serious legal infraction that strikes at the very soul of justice and the sanctity of legal proceedings... The power to punish for Contempt of Court's order is vital to safeguard the authority and efficiency of the judicial system." "The Courts ordinarily take lenient approach in a case of some delay in compliance of the orders, unless the same is deliberate and willful, on confronting the conduct of the contemnor that strikes the very heart of judicial authority." Final determinations:
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