SALORA FINANCE LIMITED v. MCM HOTELS PRIVATE LIMITED
1997-12-05
J.N.BHATT, M.H.KADRI
body1997
DigiLaw.ai
J. N. BHATT, J. ( 1 ) RULE. Heard the learned Advocates for both parties and with the consent of learned Advocates matter is heard and finally disposed of today. ( 2 ). Should we accept the plea of mercy in accepting an unqualified apology? would it not be a travesty of majesty of justice? Could the contemner be let off or left scot-free in case of gross contemptuous conduct and virulent vilification in the shape of breaches of five undertakings and 15 orders of the Court ? Such a question comes in focus in view of repeated requests to accept an unqualified apology for contempt. ( 3 ). Before we examine the mercy jurisdiction and jurisprudential justness on this count, let it be manifestly pronounced at the inception that it is not that, the court is empowered with one of the weapons in its armory to punish for contempt only is for preserving, protecting and piloting the dignity, decency and decorum of a Court, as it would appear from the plain expression of "contempt of Court", but also to protect, promote and preserve the public interest and faith in the basic feature of administration of law and its method and mode provided for vindicating the constitutional goals and its active manifestation against misuse, abuse and disintegrating or disreputing the process of law. ( 4 ). It is unquestionable that this Court has, under the Contempt of Court Act, 1971, as well as inherent and plenary constitutional powers enshrined in Art. 215 of the Constitution of India, being a case of civil contempt of this Court. It cannot be questioned that every High Court is a Court of Record and has powers including the power to punish for contempt of Court. Thus, in this context the merits need to be examined by us. Should the justice be tampered with mercy ? Should the contemner be allowed unpunished accepting the unqualified apology which is claimed to be genuine and bona fide, contending that though disobedience and defaults are committed, they were not intentional, wilful in the light of financial crunch. Factual Matrix : ( 5 ). A broad spectrum of material facts leading to the rise of the present contempt proceedings may shortly be narrated so as to appreciate the merits of the contempt application and the challenge against it.
Factual Matrix : ( 5 ). A broad spectrum of material facts leading to the rise of the present contempt proceedings may shortly be narrated so as to appreciate the merits of the contempt application and the challenge against it. The chief source is the consent order and the direction of the Court in Company Petition No. 119 of 1994 initiated for the winding-up of the respondent No. 1 - Company in which respondent No. 2 happens to be a Managing Director. Following chronological catalogue and events are unquestionable : ( 21 ). It would, therefore, be appropriate to look into the provisions of Sec. 12 of the Act which provides for punishment for contempt of Court. Section 12 (5) clearly provides that when the contempt of Court is committed by a company and it is proved that the contempt has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of the contempt and the punishment may be enforced, with the leave of the Court, by the detention in civil prison of such director, manager, secretary or other officer. Section 12 ( 1) provides punishment for contempt of Court with simple imprisonment for a term which may extend to 6 months or with fine which may extend to Rs. 2,000. 00, or with both. ( 22 ). Reliance is placed on the explanation to Sec. 12 (1) on behalf of contemners and in that it has been contended that the apology shall not be rejected merely on the ground that it is qualified or conditional if the accused makes it bona fide. It is, therefore, submitted that an unqualified and unconditional apology tendered by the respondents ordinarily should be accepted. In this connection, it was further stated that in the facts and circumstances respondents could not abide by obligations on account of financial crunch, the apology tendered is required to be accepted. As it could be seen from the aforesaid explanation that an apology shall not be rejected merely on the ground that it is conditional if it is made with bona fide intention. It also becomes clear that finding contemner guilty of contempt of Court is a condition precedent for accepting the apology.
As it could be seen from the aforesaid explanation that an apology shall not be rejected merely on the ground that it is conditional if it is made with bona fide intention. It also becomes clear that finding contemner guilty of contempt of Court is a condition precedent for accepting the apology. Apology tendered must be genuine and bona fide and not an afterthought to avoid legal implications and consequences following the contempt. We hasten to add that the said apology is not found satisfactory to hold that it is genuine and bona fide. In fact, the apology must not be ineffective and remorse and contrition tendered at the earliest opportunity must be considered. But it should not be an attempt to catch a straw by a drowning man. We have carried an impression that unconditional apology is nothing but like polishing the brass when the whole ship is sinking. We have not been able to convince ourselves that it is a bona fide much less genuine. We have also heard the respondent no. 2 in person on the quantum of sentence though not necessarily mandated when lawyer is appearing for also an opportunity to exhibit remorse for reprehensible conduct. Unfortunately, we could not find upon hearing the respondent No. 2 that the apology tendered is genuine and bona fide and it also does not radiate an imprint of real remorse. ( 23 ). Upon hearing the respondent No. 2 against quantum of sentence, it is clear that he is in charge of 3-Star Hotel, the photograph of the Hotel relied upon by him on a mere glance would run counter to the submission. ( 24 ). In this connection, it would be appropriate to mention a decision of the honble Apex Court in the case of J. Vasudevan v. T. R. Dhanjaya, JT 1995 (7) sc 484. Proviso to Sec. 12 of the Act empowers the Court for remission of the punishment on apology or on accepting the apology to stop the proceedings. As we have noticed hereinbefore apart from Sec. 12 empowering this Court, we have plenary contempt jurisdiction being a Court of Record as provided under Constitution. Be as it may, irrespective of constitutional mandate for the prescription of powers, sec. 12 also makes it clear that apology can be accepted even if it is conditional in the circumstances provided which may be genuine and bona fide.
Be as it may, irrespective of constitutional mandate for the prescription of powers, sec. 12 also makes it clear that apology can be accepted even if it is conditional in the circumstances provided which may be genuine and bona fide. Since we have found that this apology is neither genuine nor hona fide, we are satisfied that there was disobedience of obligations. ( 25 ). The observations as we have referred earlier made by the Honble Apex court in the aforesaid decision clearly go to show that in the realm of mercy jurisdiction while awarding sentence or punishment to a contemner the Court is obliged to do so. Apology can be accepted subject to the satisfaction of the Court being bona fide. It is not the factual position in the present case. Even the written apology does not strictly indicate time-bound assurance for payment. To illustrate. we may mention that it is stated that necessary steps will be taken for payment of dues, but how, by what mode nothing has been specifically stated. Therefore, we are fortified in holding that it is neither genuine nor bona fide. Therefore, there is no question of tampering with mercy in the present case as it would send wrong signals in society that party can take it lightly and show it seriously as and when called upon. The basic concept of Rule of Law would be affected in a case like one on hand where repeatedly and consecutively number of undertakings and directions of the Court are made and violated. As mandated in Sec. 12 the contemner can be punished for a maximum term of six months and/or punished with fine of rs. 2,000/-, or both. ( 26 ). Reliance is placed on the following case law by and on behalf of respondents. ( 27 ). In the case of Mohd. Iqhal Khanday v. Abdul Majld Rather, reported in 1994 (4) SCC 34 the principle laid down is that the apology can be accepted but in order to constitute a good ground for acceptance it must be genuine and bona fide which is lacking in the present case and therefore, said decision does not help, in anyway, to the respondents. It is not possible mathematically or geometrically to show whether there was bona fide or genuine apology or not but it is to be examined and analysed in the light of entire factual scenario.
It is not possible mathematically or geometrically to show whether there was bona fide or genuine apology or not but it is to be examined and analysed in the light of entire factual scenario. In the present case, we have found that there was no bona fide and genuine apology. ( 28 ). Even the reliance on the decision of Honble Apex Court in the case of dinabandhu Sahu v. The State of Orissa, AIR 1972 SC 180 does not help for the simple reason that it lays down that an apology which was tendered sincerely accompanied with a request to forgive deserves acceptance. In the present case as observed hereinbefore, we are not satisfied that apology is bona fide and genuine and therefore, said decision is also not applicable in the present case. ( 29 ). The Honble Apex Court in the decision of J. Vasudevan (supra) clearly laid down that in order to invoke mercy jurisdiction and remission of sentence even if it is impressed on a contemner it must be shown to the satisfaction of the Court so that there was sincere and genuine apology. It is observed that it would be a death-knell to the rule of law and social justice would receive a fatal blow and if mercy is shown in such repeated contempt that the people would lose faith in the system of administration of justice and would desist from approaching the Court by spending time, money and energy to fight their legal battle. If in such a situation mercy is shown, the effect would be that people would not knock the door of the courts to seek justice, but would settle score on the streets, where muscle power and money power would win, and the weak and the meek would suffer. In the present case the contemner No. 2 is a person in the rank of not less than a M. D. and there was an obligation to advance the cause of public interest which requires maintenance of rule of law failing which the contemners are required to be punished. ( 30 ). After having examined the ratio laid down in the case of Pushpaben v. Narandas, AIR 1979 SC 1536 relied upon by the respondents we have found that it is not applicable to the facts of the present case. In that case the sentence of imprisonment was not warranted.
( 30 ). After having examined the ratio laid down in the case of Pushpaben v. Narandas, AIR 1979 SC 1536 relied upon by the respondents we have found that it is not applicable to the facts of the present case. In that case the sentence of imprisonment was not warranted. What should be the quantum and quality of punishment depends upon the facts and circumstances of each case. There cannot be a universal formula or rigid yardstick. If the contempt is committed the punishment must follow in the light of the gravity of contempt committed. ( 31 ). In the case of Sadhvi Ritumbhara v. Digvijay Singh, reported in 1997 (3) scc 662 the unconditional apology of a contemner was accepted, and in view of the facts and circumstances of the case proceedings against contemner could not be withdrawn as there was clear case for accepting the apology in the circumstances of the case. Said decision is also not applicable to the facts of the case as there are peculiar facts and circumstances as could be seen from the highlights of the case. ( 32 ). In the case of Anjuman Isnai Ashria v. Shanti Sarup Ashria, in AIR 1982 sc 1461 it has been held by the Honble Apex Court that the defendant in suit for possession giving undertaking to Court that the he will give possession of disputed property in agreed time, and in case of breach of undertaking, contempt is constituted. However, at the hearing the contemner was leniently dealt with as he had agreed to part with the possession of disputed premises in agreed time. As we have discussed in the written apology no time-bound programme or any indication is made. Therefore, the ratio of said decision is not applicable to the present case. ( 33 ). Reliance is also placed on the decision of this Court in the case of Ratilal bijalbhai Bharwad v. Manager, Alok Synthetics, 1995 (2) GLH (UJ) 14 the principles laid down about the exercise of discretionary contempt jurisdiction in Para 3 of the said judgment are not in controversy. ( 34 ). Having regard to the aforesaid conspicuous facts and circumstances and relevant proposition of law, we have no hesitation in holding and finding the respondents guilty for contempt for breach of undertakings and directions stated hereinbefore.
( 34 ). Having regard to the aforesaid conspicuous facts and circumstances and relevant proposition of law, we have no hesitation in holding and finding the respondents guilty for contempt for breach of undertakings and directions stated hereinbefore. We, therefore, hold respondents guilty of civil contempt as defined under Sec. 2 (b ). The respondent No. 2 Managing Director, who has actively associated with all proceedings since inception of the Company Petition contempt of each undertaking and each direction constitute separate offence punishable under sec. 12 of the Act, the contemptuous conduct must be punished not only for vindicating the decency and decorum and rule of law but also faith and confidence of people in the rule of law which is basic feature of the Constitution of India. We also feel guilty in having shown unduly leniency in the course of proceedings before us in giving 15 opportunities by passing different orders and resultant six undertakings. In this context we also mention the well-known saying that"this world has suffered much pain and cruelty from doing what we believe to be right rather than from doing what we believe to be wrong. "we trusted and desired that there will be purging of contempt and to enable the respondents to obliterate the contemptuous conduct by complying with the first undertaking and direction of the Company Court recorded on 4-12-1995, undertaking dated 30-11-1995 and while deciding the quantum of sentence it would be also necessary to mention that pursuant to undertakings and assurances made by respondents before us in the proceedings were also not honoured. So it is not a case of mere breach of undertaking, but gross misuse, abuse of process of Court. It is, therefore, necessary to appropriately punish the respondents. ( 35 ). Consequently, we he1d both the respondents guilty of civil contempt and direct that the respondent No. 1 - 3 - Star Hotel, corporate personality shall pay fine of Rs. 2,000. 00 and in default thereof the same shall be recovered like land revenue and the respondent No. 2-MD - Vijay Modi of the respondent No. 1 - company to be detained in civil prison at Baroda for a period of one month and is further sentenced to pay fine of Rs. 2,000. 00 in default thereof to undergo further simple imprisonment for a period of 15 days.
2,000. 00 in default thereof to undergo further simple imprisonment for a period of 15 days. The respondent No. 2 - Contemner who is present in the Court is directed to be taken into custody forthwith. ( 36 ). At this stage, upon a request of learned Advocate Mr. Majmudar on behalf of the contemner who is ready and willing to give undertaking to this Court in following terms, we defer the substantive sentence and imprisonment insofar as contemner No. 2 is concerned and therefore, defer the sentence on the following terms and conditions :- (i) The contemners shall file undertaking today that pursuance to the last assurance given to this Court amount of Rs. 1,50,000. 00 shall be paid by a/c. Payee DD in favour of applicant-company on or before 15-12-1997. (ii) The contemners shall give further undertaking that the entire amount with accrued interest as per consent terms shall be paid or deposited before this court on or before 31-1-1998. (iii) If the contemners fail to make payment as stated above the aforesaid sentence and imprisonment shall be operative forthwith. (iv) No application for extension of time shall be filed and the said terms shall be incorporated in the undertaking. (v) The contemners shall not leave India without prior approval/ permission of the Court until full payment is made or deposited before this Court. We therefore, direct the respondent No. 2 - MD-Vijay Modi to surrender his passport on or before 8-12-1997 before this Court with the Registry of this court before 11-00 a. m. on 8-12-1997. (vi) Breach of any of the aforesaid terms and conditions shall ential into forthwith enforcement of deferred sentence of imprisonment. (vii) Obviously, it need not be clarified as suggested by Mr. Majmudar that in case of successful compliance of the aforesaid terms and conditions the order of sentence in respect of respondent No. 2 - Managing Director Mr. Modi. shall not survive. ( 37 ). In view of the aforesaid observations, the terms and conditions and directions the contempt application stands disposed of and rule is made absolute to the aforesaid extent with costs of Rs. 10,000. 00 to be deposited in the State Legal Services Authority on or before 10-12-1997 as one of the aforesaid conditions. .