G. C. Jain,j. ( 1 ) LEASE hold rights in plot No. 16, Nehru Place, New Delhimeasuring 445. 93 sq. mts. were auctioned by the Delhi Development Authority (for short D. D. A.) at a Public auction. The bid of Smt. Kanwaljit Kaur Bhasinand Smt. Kamleen Bhasin, respondents, for Rs. 63,ll,000. 00, was accepted bythe DDA by its letter dated 8/11/1979. The said lease hold rights wereacquired to construct a multi-storeyed building on the said plot in accordancewith the terms and conditions, plans and other particulars stipulated by thedda. ( 2 ) BY an agreement dated 3/03/1980 the respondents agreed to sellto M/s. Jyoti Limited, the petitioner the third and fourth floors of the proposedmulti-storeyed building with an area measuring 9000 sq. ft. at Rs. 340. 00 persquare ft. or for a total sum of Rs. 30,60,000. 00. A sum of Rs. 2 lakh was to bepaid to the respondents on execution of the said agreement. A sum of Rs. 1lakh -was to be paid on furnishing proof to the petitioner of having taken possession of the plot by the respondents from the DDA. Remaining amount ofrs. 27,60,000. 00 was to be paid to the respondents on completion of the buildingand at the time of delivery of possession of the said floors. Clause 5 of theagreement provided that time shall always be the essence of the contract. Itfurther provided "any payment made by JYOTI within 30 days of its becomingdue for payment to the BUILDERS shall be deemed to have been made intime. " ( 3 ) THE sum of Rs. 2 lakhs which under the agreement was to be paid onthe execution of the agreement was admittedly not paid on 3/03/1980when the agreement was executed. By letter dated March 15, 1980 the agreement of sale was cancelled by the respondents alleging breach of the term ofthe contract by the petitioner relating to the payment of said sum of Rs. 2 lakhswhich had not even been paid by that date. On 22/03/1980 the petitionersent a letter to the respondents with abank draft dated 13/03/1980 forrupees two lakhs. It was stated that at the time of the signing of the agreementthe respondents had been intimated that the bank draft for this amount was tobe received from Baroda and will be paid to the respondents when received. On 22/03/1980 the petitionersent a letter to the respondents with abank draft dated 13/03/1980 forrupees two lakhs. It was stated that at the time of the signing of the agreementthe respondents had been intimated that the bank draft for this amount was tobe received from Baroda and will be paid to the respondents when received. Itwas further stated that the very fact that the respondents signed the agreementindicated that they did not insist on making this payment at the time of execution of the agreement and in any event under clause 5 of the agreement thepayment could be made within 30 days of its becoming due. ( 4 ) ON 12/05/1980 the petitioner brought a suit against the respondentsseeking a decree for declaration that the purported cancellation of the agreement dated 3/03/1980 by the said respondents was wrongful and not binding on the petitioner and a decree for specific performance of the agreementdated 3/03/1980 and in the alternative, in case specific performance wasnot decreed, an enquiry regarding the damages suffered by the petitioner and adecree for the said amount. ( 5 ) ALONG with the suit the petitioner filed an application (I. A. 1803/80)under Order 39 rule 1 read with Section 151, Code of Civil Procedure seekingtemporary injunction restraining the respondents from dealing with or disposingthe third and fourth floors of the premises of the multi-storeyed building to beconstructed on plot No. 16, Nehru Place, New Delhi or any portion thereof inany manner. On 13/05/1980 D. R. Khanna, J. made the following order onthis application :- "notice of the application to the defendants for 22/05/1980. Inthe meanwhile the defendants are restrained from transferring in anymanner the 3rd and 4th floor of the multi-storeyed building to beset up on plot No. 16 Nehru Place, New Delhi. Notice dasti . " ( 6 ) AFTER hearing the parties, this order was confirmed and extended tillthe decision of the suit by order dated 8/10/1980. Appeal against thesaid order was dismissed as withdrawn by a Division Bench of this court on 15/04/1981. ( 7 ) ON 8/02/1983 the petitioner brought the present applications (la 630/83) under Order 39 rule 2a of the Code of Civil Procedure. Appeal against thesaid order was dismissed as withdrawn by a Division Bench of this court on 15/04/1981. ( 7 ) ON 8/02/1983 the petitioner brought the present applications (la 630/83) under Order 39 rule 2a of the Code of Civil Procedure. It wasaverred that in complete disregard to the order dated 13/05/1980 which hadbeen confirmed on 8/10/1980 the respondents had transferred and/or soldand/or alienated and/or parted with the possession of the complete third andfourth floor of the said building and had thus wilfully disobeyed and flouted thesaid orders of the court. The wilful, deliberate and contemptous disobedienceand flagrant violation of the said orders of the court made the respondentsliable to action. It was prayed that respondents be directed to revoke theiractions contrary to the aforesaid orders and the court may direct the attachment of the property of the respondents and/or in the alternative direct therespondents to be detained in a civil prison. ( 8 ) ON the same date i. e. 8/02/1983 the petitioner filed a separatepetition (Civil Contempt Petition No. 5/83) under Article 215 of the Constitution and Sections 11 and 22 of the Contempt of Courts Act, 1971 and Section151 of the Code of Civil Procedure for initiating contempt proceedings againstthe respondents under Article 215 of the Constitution of India and the Contempt of Court s Act, 1971 and inflicting such punishment on them as the courtdeemed just and proper and also a direction to the respondents to comply withthe orders of the court dated 13/05/1980 and October 8, 1980 and revoketheir actions taken contrary to the aforesaid orders. Their reliefs were claimedon the same allegations which formed part of application under Order 39 Rule2a, C. P. C. ( 9 ) BOTH these applications were contested by the respondents. It was notdenied that the third and fourth floors had sincebeen sold/transferred/alienatedand possession parted with. It was, however, averred that the third floor hadbeen booked in March, 1980 i. e. before the restraint orders. It was explainedthat the respondents in the very beginning contemplated that a joint stockcompany under the name and style of M/s. Tower Height Builders Pvt. Ltd. (hereinafter to be referred as the company ) would be floated. The negotiationsbetween the representatives of the respondents started a few months before theagreement dated 3/03/1980. It was explainedthat the respondents in the very beginning contemplated that a joint stockcompany under the name and style of M/s. Tower Height Builders Pvt. Ltd. (hereinafter to be referred as the company ) would be floated. The negotiationsbetween the representatives of the respondents started a few months before theagreement dated 3/03/1980. The terms were earlier settled tentatively andone of the term provided that the respondents were promoting a company bythe name of M/s. Tower Height Builders Pvt. Ltd. of which Smt. Kanwaijitbhasin, respondent No. 1 and Smt. Kamleen Bhasin, respondent No. 2 were tobe the chairman and the managing director respectively. The said companywas incorporated on 10/01/1980. Leasehold rights in respect of the plot,on which the multi-storeyed building was to be constructed, were transferred infavour of the company on 12/11/1980. The third and fourth floorssubject matter of the dispute were actually transferred by the company and notby the respondents. The respondents had, thus, not in any manner disobeyedor flouted the orders of this court. ( 10 ) THIS order shall dispose both the applications i. e. I. A. 630 of 1983and civil contempt petition No. 5 of 1983. ( 11 ) ORDER 39 Rule 2a (1) of the Code of Civil Procedure and Section 2 (b)and 12 (1) and 12 (3) of the Contempt of Courts Act read as under : "order 39r. 2a Consequence of disobedience of breach of injunction. (1) In the case of disobedience of any injunction granted or otherorder made under rule I or rule 2 or breach of any of the termson which the injunction was granted or the order made, thecourt granting the injunction or making the order, or any courtto which the suit or proceeding is transferred, may order theproperty of the person guilty of such disobedience or breach tobe attached, and may also order such person to be detained inthe civil prison for a term not exceeding three months, unless inthe meantime the Court directs his release. "section 2 (b) of the Contempt of Court Act, 1971"civil contempt" means wilful disobedience to any judgment,decree, direction, order writ or other process of a court orwilful breach of an undertaking given to a court ;section 12 (1)Save as otherwise expressly provided in this Act or in any otherlaw, a contempt of court may be punished with simple imprisonment for a term which may extend to six months, or with finewhich may extend to two thousand rupees, or with both :provided that the accused may be discharged or punishmentawarded may be remitted on apology being made to the satisfaction of the court. Explanationan apology shall not be rejected merely on the ground that it isqualified or conditional if the accused makes it bona fide. "section 12 (3)Notwithstanding anything contained in this section, where aperson is found guilty of a civil contempt, the court, if it considers that a fine will not meet the ends of justice and that asentence of imprisonment is necessary, shall, instead of sentencing him to simple imprisonment, direct that he be detained in acivil prison for such period not exceeding six months as it maythink fit. " ( 12 ) "whether Smt. Kanwaijit Kaur Bhasin and Smt. Kamleen Bhasin,the respondents, had wilfully disobeyed the order, dated 13/05/1980, whichwas confirmed on 8/10/1980, restraining them from transferring in anymanner the third and fourth floors of the multi-storeyed building to be set upon plot No. 16, Nehru Place, New Delhi" is the question which requires determination, in view of the above provisions. ( 13 ) THE respondents in their reply to these applications have admittedthat the fourth floor had been sold, transferred, alienated and parted possession with" by the company (M/s. Tower Height Builders Pvt. Ltd.) after passing of the said orders. ( 14 ) THE Company is a private limited company. It was incorporatedunder the Companies Act 195 6/01/1980. A company, duly incorporated, is a distinct and independent legal person. It has a legal entity andin law equal to a natural person. Like a partnership it is not a mere aggregateof its members. In law it is legal independent person distinct from its members. In law it is legal independent person distinct from its members. It bears its ownname and has a seal of its own. Its assets are separate and distinct from thoseof its members. It can sue and be sued in its own name. In law it is legal independent person distinct from its members. In law it is legal independent person distinct from its members. It bears its ownname and has a seal of its own. Its assets are separate and distinct from thoseof its members. It can sue and be sued in its own name. This position is wellsettled ever since the decision in case of Aron Salomon vs. A. Salomon and Company Limited (1987) A. C. 22. ( 15 ) THE doctrine that a company has a legal and separate entity of itsown, has, however, been subjected to certain exceptions by the application ofthe fiction that the corporate veil can be lifted and its face examined in substance. ( 16 ) GOWER in Modern Company Law, 2nd Edition, has classified sevencategories of cases where the veil of a corporate body has been lifted. One ofthe categories of such cases is where the "corporate personality is being blatantly used as a cloak for fraud or improper conduct. " In Palmer s Company Law23rd edition the occasions when the corporate veil may be lifted have beenenumerated and classified in fifteen categories. Category 8 has been describedthus : "the courts have further shownthemselves willing to "lift the veil" wherethe device of incorporation is used for some illegal or improper purpose. " (page 202) Pennington in his Company Law 4th Edition states "in a few casesthe court has disregarded the separate legal personality of a company and hasinvestigated the personal qualities of its shareholders or the persons in controlof it because there was an overriding public interest to be served by doing so. All these cases involved questions of nationality, and all of them, except one,were decided in wartime when the nationalities involved were those of enemyalients. " ( 17 ) IN. Life Insurance Corporation of India vs. Escorts Ltd and others1986 (1) Supreme Court Cases 264, the Supreme Court after examining the lawon the subject said : "generally and broadly speaking, we may say that the corporate veilmay be lifted where a statute itself contemplates lifting the veil, orfraud or improper conduct is intended to be prevented, or a taxingstatute or a beneficent statute is sought to be evaded or where associated companies are inextricably connected as to be, in reality, partof one concern. It is neither necessary nor desirable to enumeratethe classes of cases where lifting the veil is permissible, since thatmust necessarily depend on the relevant statutory or other provisionsthe object sought to be achieved, the impugned conduct, the involvement of the element of the public interest, the effect on parties whomay be affected etc. ( 18 ) THE object to punish the wilful disobedience to any order of a courtis to secure the enforcement of the said order. Justice would be undone if anycourt is disobeyed without fear of any punitive consequences. Vindication ofthe public interest by punishment for contemptuous conduct is the purposesought to be achieved. "it is the plain and unqualified obligation of everyperson against, or in respect of, whom an order is made by a court of competent jurisdiction to obey it unless and until that order is discharged. The uncompromising nature of this obligation is shown by the fact that it extends evento cases where the person affected by an order believes it to be irregular or evenvoid. " (See Handkinson v. Handkinson (1952) Vol. II. The All England Lawreports 567 at 569. ( 19 ) ABOUT the nature of the contempt proceedings the Supreme Court inadvocate General, Bihar vs. M. P. Khair Industries AIR 1980 SC 946 to 949held : ". . . . . . IT may be necessary to punish as a contempt, a course of conduct which abuses and makes a mockery of the judicial process andwhich thus extends its pernicious influence beyond the parties to theactions and affects the interest of the public in the administration ofjustice. The public have an interest, and abiding and a real interest,and a vital stake in the effective and orderly administration of justice,because, unless justice is so administered, there is the peril of allrights and liberties perishing. The court has the duty of protectingthe interest of the public in the due administration of justice and, so,it is entrusted with the power to commit for Contempt of Court, notin order to protect the dignity of the Court against insult or injury asthe expression "contempt of Court" may seem to suggest, but toprotect and to vindicate the right of the public that the administration of justice shall not be prevented, prejudiced, obstructed or interfered with. "it is a mode of vindicating the majesty of law, in itsactive manifestation against obstruction and outrage. " Per Frankfurterj. "it is a mode of vindicating the majesty of law, in itsactive manifestation against obstruction and outrage. " Per Frankfurterj. in Offutt v. U. S. (1954) 348 US 11. "the law should not be seen to sit by limply, while those whodefy it go free, and those who seek its protection lose hope. " Perjudge, Curtis- Raleigh quoted in Jennison v. Baker (1972)1 All ER997 at p. 1006. ( 20 ) IN Phonographic Performance Ltd. v. Amusement Caterers (Peckham)Ltd. (1963) 3 All E. R. 493 at 496 Cross J said. "as is pointed out in halsbury slaws of England (1), where there has been wilful disobedience to an order ofthe court and a measure of contumacy on the part of the defendants, then civilcontempt, what is called contempt in procedure "bears a two-fold character,implying as between the parties to the proceedings merely a right to exerciseand a liability to submit to a form of civil execution, but as between the partyin default and the state, a penal or disciplinary jurisdiction to be exercised bythe Court in the public interest. " ( 21 ) THUS, it is clear that the law of contempt is conceived in the publicinterest. In the present case, I have no doubt, the corporate veil is being blatantly used as a cloak to wilfully disobey the orders of the court-an improperpurpose. Lifting the corporate veil, in these circumstances, is imperative topunish improper conduct. Public interest requires the corporate veil must belifted to find out the person who disobeyed the order of the court. ( 22 ) ONCE, the corporate veil is lifted it is crystal clear that the orders ofthe court in question were disobeyed by the respondents. The company (M/s. Tower Height Builders Pvt. Ltd.) was admittedly promoted by the respondentsalone. They, only were its shareholders and Directors. One of the respondentssmt. Kanwaijit Kaur Bhasin was its Chairman and the other respondent, Smt. Kamleen Bhasin, its Managing Director. The entire interest in the companywas of the respondents. Thus, inreality the orders of the court were disobeyedby the respondents. They, only were its shareholders and Directors. One of the respondentssmt. Kanwaijit Kaur Bhasin was its Chairman and the other respondent, Smt. Kamleen Bhasin, its Managing Director. The entire interest in the companywas of the respondents. Thus, inreality the orders of the court were disobeyedby the respondents. ( 23 ) wilful according to the Stroud s Judicial Dictionary 5th Edition,implies nothing blameable, but merely that the person of whose action ordefault the expression is used is a free agent and that what has been donearises from the spontaneous action of his free will and it amounts to nothingmore than this, that he knows what he is doing and intends to do what he isdoing, and is a free agent; whatever is intention is wilful. " According toshorter Oxford Dictionary wilful means "asserting or disposed to assert one sown will against persuasion, instruction, or command, governed by will withoutregard to reason ; obstinately self-willed or perverse. " A wilful act, thus meansan intentional and deliberate act. ( 24 ) LA the present case there was no allegation even that the act oftransferring the fourth floor was not an intentional or deliberate act. Thus ithas been proved that the disobedience was wilful. ( 25 ) RESPONDENTS contemnors were entitled to justify their action. However, no justification worth the name is forthcoming except the corporate veil. The facts, that the construction work was supervised by S. Pritipal Singh husband of respondent No. 1, or that husbands of the respondents were new inthe business do not furnish any justification for wilfully disobeying the ordersof the Court. ( 26 ) MR. G. S. Vohra, learned counsel for the respondents contended that the company was not conceived in fraud i. e. for the purpose of disobeying theorders of the court. The respondents contemplated the formation of this company at the time of the auction of the leasehold rights of the plot in questionand it was actually incorporated on 10/01/1980 i. e. long before the injunction was granted. The respondents, no doubt, contemplated the formation thiscompany since beginning. It had actually been incorporated on 10/01/1980 i. e. before the injunction orders were granted. However, nothing turnson it. The fact that the company was incorporated earlier is no justificationfor disobeying the orders of the court. The respondents, no doubt, contemplated the formation thiscompany since beginning. It had actually been incorporated on 10/01/1980 i. e. before the injunction orders were granted. However, nothing turnson it. The fact that the company was incorporated earlier is no justificationfor disobeying the orders of the court. I may add here that the lease-holdrights in respect of the plot in question were transferred in favour of the company only on 12/11/1980 i. e. after the injuntion order. Prior to thatthe company had no right, title or interest in this property. ( 27 ) ARGUMENTS on these applications were partly heard on 10/12/1986. Mr. G. S. Vohra, learned counsel for the respondents, on that date madea request for permission to file additional affidavits. This request was allowedthe arguments were thereafter heard from 9/02/1987 onwards. On 1 6/02/1987 when the arguments had already been completed the respondentfiled affidavits tendering unconditional apology. Para 4 of the affidavit of Smt. Kanwaijit Kaur Bhasin dated 16-2-87 reads as under : "that I humbly tender unconditional apology, which may be placedon the record. My counsel Sh. G. S. Vohra tendered apology on mybehalf before he closed his opening arguments on 11-2-87. I haveutmost respect for the orders and processes of this Hon ble Court aswell as of all courts of law in the country. The circumstances underwhich transfers of floors took place has been stated in my affidavitand the same not be repeated here. "similar statement was made in the affidavit of Smt. Kamleen Bhasin of thesame date. ( 28 ) I have carefully considered the apology. The apology made afterthe conclusion of the argument is no apology. It lost its value. It was anafter-thought and a mere device to escape punishment. It does not purge thecontempt. "apology has to be offered clearly at the earliest opportunityindicative of remorse and contrition which is the essence of the purging of acontempt and it should not be offered in the hope and with the object of avoiding punishment. " (See E. T. Sen vs. E. Naraynan AIR 1969 Delhi 201 (F. B. ). This is not so in this case. The contempt committed by the respondents wasserious. The respondents, it appears, bad no regard for the orders of the court. All the the time they tried to take advantage of the corporate veil. Apologyappears to have been tendered because of some odservations made by thewwt during arguments. This is not so in this case. The contempt committed by the respondents wasserious. The respondents, it appears, bad no regard for the orders of the court. All the the time they tried to take advantage of the corporate veil. Apologyappears to have been tendered because of some odservations made by thewwt during arguments. In these facts and circumstances, the apology, in myview was not bonafide and is rejected. ( 29 ) ONE of the purposes of punishment in contempt proceedings isvindication of public interest by punishment ofcontemnor s conduct. Thesentence must be adequate. It would be a traversty of justice if the courts wereto allow gross contempt of court to go unpunished. ( 30 ) IN the present case the respondents had wilfully disobeyed the ordersof the Court made on 13/05/1980. Instead of obeying the said orders,which they were under an obligation to obey, they employed a subterfuge i. e. vei1 of corporation to avoid compliance of the Court s order. The respondentswere guilty of flagrant disobedience of the orders of the Court. It was a contempt of heinous character. For such contempt sentence of fine, in my view,would not meet the ends of justice. ( 31 ) I intended to impose a severe punishment but keeping in view thefact that respondents were women and that Smt. Kanwaijit Kaur Bhasin isstated to have been suffering from diabetes, hypertension and angina and Smt. Kamleen Bhasin had two children aged 3 and 7 years old their detention incivil prison for a period of 15 days, in my opinion, would meet the ends ofjustice. ( 32 ) I consequently, accept the petitions and direct the respondents to bedetained in civil prison for 15 days. The petitioner is directed to depositrs 3 000. 00 in account for meeting their expenses within a week. On the depositof the said amount warrants for their arrest for the purpose of their detentionof the civil prison would immediately be issued. Petitioner is entitled to costswhich are assessed at Rs. 5,000. 00.