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Scindia Potteries & Services Pvt. Ltd. v/s Ankur Jain & Others


Company & Directors' Information:- INDIA POTTERIES LTD. [Active] CIN = U24232WB1958PLC010678

Company & Directors' Information:- U P S I C POTTERIES LIMITED [Strike Off] CIN = U26942UP1976SGC004270

Company & Directors' Information:- B A JAIN & CO. PRIVATE LIMITED [Active] CIN = U21014WB1997PTC083658

Company & Directors' Information:- N S JAIN AND COMPANY PRIVATE LIMITED [Active] CIN = U31909MH1997PTC112719

Company & Directors' Information:- V K JAIN AND CO PRIVATE LIMITED [Active] CIN = U74899DL1993PTC055478

Company & Directors' Information:- M B POTTERIES PRIVATE LIMITED [Active] CIN = U26911RJ1984PTC002954

Company & Directors' Information:- H. V. JAIN & CO PRIVATE LIMITED. [Active] CIN = U74140MH2009PTC189774

Company & Directors' Information:- JAIN SERVICES PVT LTD [Under Process of Striking Off] CIN = U74140WB1988PTC044558

Company & Directors' Information:- J P POTTERIES PRIVATE LIMITED [Strike Off] CIN = U26911WB2004PTC099271

Company & Directors' Information:- ANKUR SERVICES PVT LTD [Active] CIN = U93000TG1984PTC004643

Company & Directors' Information:- T M E POTTERIES PVT LTD [Active] CIN = U26911WB1962PTC025710

Company & Directors' Information:- JAIN AND CO PVT LTD [Strike Off] CIN = U65921UP1925PTC000288

Company & Directors' Information:- SCINDIA POTTERIES AND SERVICES LTD. [Not available for efiling] CIN = U99999DL2000PTC902809

    CONT.CAS(C). No. 661 of 2019 & CM. APPL. No. 33657 of 2019

    Decided On, 02 March 2020

    At, High Court of Delhi

    By, THE HONOURABLE MR. JUSTICE YOGESH KHANNA

    For the Petitioner: Ajay Kapur, Senior Advocate, Mahima Dang, Advocate. For the Respondents: R1 to R3, Tasneem Ahmadi, Mahima Rathi, R4, Animesh Sinha, Ankita Bansal, Advocates.



Judgment Text


1. The petitioner filed this petition under Section 11 and 12 of the Contempt of Courts Act, 1971 (hereinafter referred as ‘the Act’) for initiation of the contempt proceedings against the respondents/ contemnors for punishing them for the willful breach of the undertakings given by them on 18.07.2018 and 1.08.2018 and also for misusing the premises in question by them.

2. The learned senior counsel for the petitioner alleges CS(OS) No.1311/2001 titled "Scindia Potteries & Services Pvt. Ltd vs. Dr. J.K. Jain & Anr." was filed for mandatory injunction, permanent injunction, recovery of use, occupation, physical and vacant possession and recovery of mesne profits against respondents in June 2001.

3. The learned Trial Court on 17.07.2017 decreed the said suit in favour of petitioner for possession, mesne profits, injunctions restraining the respondents from carrying out illegal activities and for raising further construction and mandatory injunction directing the respondents to demolish the illegal constructions/structure etc.

4. The respondents preferred an appeal being RFA No.857/2017 before this Court titled Dr.J. K. Jain and another vs Scindia Potteries & Services Pvt Limited challenging the judgment and decree dated 17.07.2017 and on 11.10.2017 this Court passed the following order:-

“13. The senior counsel for the appellants states that the appellants will place a proposal before this Court of the amount which the appellants can deposit and the unencumbered security which the appellants can furnish for the remaining decretal amount.

14. I may add that the appellants, during the pendency of this appeal shall remain liable for future mesne profits.”

5. Thus, conditional stay was granted on the execution of the decree by this Court on 23.11.2017 and the respondents were to deposit 50% of the decreetal amount with up-to-date interest with the Registry of the Court within eight weeks and subject to the further condition of the respondent’s depositing the monthly user and occupation charges at the rate of Rs.7.5 lacs per month till the final disposal of the appeal. Such time period expired on 18.01.2018 and the respondents failed to deposit the money.

6. On 01.02.2018, when the petitioner filed the Execution Application No.80/2018 before learned Trial Court, the respondents filed CM No.4177/2018 under Section 151 CPC praying for pardon for non-compliance of the order dated 23.11.2017 and to grant one month time to deposit the said amount.

7. On 05.02.2018, this Court interalia passed the following order:-

“The learned counsel for the appellant states that by the 10th day of each Gregorian calendar month an amount of Rs.7.5 lacs shall be deposited into respondent/Decree Holder’s bank account: Punjab National Bank Account No.0151002100010748 [IFSC Code PUNB0015100] in the name of Scindia Potteries & Services Pvt. Ltd., Punjab National Bank, Sarojini Nagar, New Delhi-23.

Any infraction in the payment of the said amount shall automatically result in payment of cost of Rs.15,000/- to the respondent, which amount(s) too shall be deposited into the aforesaid bank account within two weeks thereafter.

The arrears of Rs.7.5 lacs, payable from 17th July, 2017, shall be paid into the said bank account within five weeks from today.”

8. Unfortunately, Mr.J.K. Jain expired on 05.03.2018 and the application bearing CM No.4177/2018 was disposed of on 18.07.2018 wherein this Court noted:-

"23. The counsel for the legal heirs of appellant / defendant no.1 states that the legal heirs could not deposit without coming on record.

24. The legal heirs of the appellant / defendant no.1 cannot on the one hand continue in possession and on the other hand wriggle out from the liabilities of the deceased appellant / defendant no.1.

25. The counsel for the legal heirs of appellant / defendant no.1 states that Mr. Ankur Jain, son of the deceased appellant / defendant no.1, is personally present in the Court and undertakes to this Court to, within two weeks, deposit 25% of the decretal amount with up to date interest thereon and within four weeks, deposit another 25% of the decretal amount with up to date interest thereon.

26. Mr. Ankur Jain identified by the advocate has been cautioned of consequences of breach of undertaking given to the Court.

27. If the undertaking is not complied with, the respondent / plaintiff besides being entitled to execute the decree shall also be entitled to initiate proceedings against Mr. Ankur Jain for contempt of Court for breach of the undertaking given to the Court. "

9. Admittedly, Mr.Ankur Jain, respondent No.1 had filed an undertaking on behalf of late Dr.J.K.Jain and on behalf of respondent No.2 – Jain Studio Limited, as its authorised representative. In view of the undertaking given by the respondents on 18.07.2018, this Court extended time to deposit the amount and allowed the respondents to deposit 25% of the said amount with up to date interest within two weeks and balance amount within four weeks. The Court also cautioned the respondent No.1 present in the Court of the consequences of breach of the undertaking given by him. However, despite the undertaking given on 18.07.2018, the respondents yet again failed to deposit the said amount and instead moved the application CM No.30665/2018 along with affidavit(s) sworn by Ragini Jain, Ankur Jain and Madhurika Jain wherein it was prayed reasonable time be given to comply with the undertakings recorded on 18.07.2018.

10. On 01.08.2018, this Court modified the order dated 18.07.2018 on the undertaking of Ankur Jain and allowed the respondents to deposit 25% of the decretal amount within three months and 25% of the decretal amount within four months thereafter and also directed no further extension shall be given and in case Ankur Jain is found to be in breach of the undertaking, the consequences would follow. The order dated 01.08.2018 notes:-

“5. The counsel for the appellant no.1, again under instructions from Mr.Ankur Jain aforesaid, states that Mr.Ankur Jain undertakes to this Court to deposit 25% of the decretal amount within three months of today and the balance 25% of the decretal amount within four months of today.

6. The aforesaid undertaking of Mr.Ankur Jain is accepted and it is made clear to him that no further extension shall be granted and if he is found to be in breach of the undertaking, consequences shall follow.

7. The order dated 18th July, 2018, to the aforesaid extent, is modified in terms of the above.”

11. The respondents yet again failed to deposit the amount as undertaken by them and instead preferred CM No.47168/2018 seeking further extension of time. The prayers made in this application are:-

"a) Modify order dated 01.08.2018 by extending the time for deposit of decretal amount by the newly impleaded Applicants (Appellant Nos. 1A to C) with the Registry of this Hon'ble Court;

b) Pass such other orders that this Hon'ble Court may be deem fit and proper in the present circumstances."

12. In para No.6 of above application it is stated further extension of time is required to make the deposits. However, vide order dated 14.12.2018, this Court declined to extend the time. Hence, it is argued by the petitioner’s counsel the entire conduct of the respondents is exposed that it was a predesigned game plan to give undertaking on 18.07.2018 and on 01.08.2018 to get execution of the decree stayed and they had no intention to deposit the amount and rather have misused the process of law in every possible manner.

13. The respondents were also duty bound to pay Rs.7.50 lacs per month and they have also stopped depositing the same with effect from October 2018. Thus, it is argued the entire conduct of the respondents clearly establish since very beginning they had no intention to deposit the amount despite their undertakings dated 18.07.2018 and 01.08.2018 which were made on the basis of their sole motive to have stay of the execution process against them. However, it was alleged that when even the Government Officials from L & DO visited the subject premises on 10.08.2018 as per the directions of this Court in CWP No.1295/1988 they were manhandled by the director and staff members of respondents for which the FIR No.127/2010 dated 10.08.2010 was registered at police station Sarojini Nagar, New Delhi, thus it is argued the respondents willfully had breached the undertaking given to this Court and have frustrated the orders passed by this Court, hence an order is required to be passed to initiate the contempt proceedings against the respondents for their willful breach of the undertaking(s) given by them.

14. In the reply the respondents have referred to the various applications moved by the respondents as noted above, to show initially the orders were passed when Dr.D.K.Jain was alive but on 05.03.2018 he expired and his legal heirs including Ankur Jain were brought on record and though they had every intention to pay and satisfy the decree by selling their estate, but they could not. He referred to various applications and orders to show they were trying their best to make the payment, but could not do so. Rather in CM Application No.20665/2018 respondents have categorically averred as follows:-

"4. After order dated 18.07.2018 was passed by this Hon'ble Court Appellant No. IB proceeded to make efforts to comply with the orders passed by this Hon'ble Court. However, it was observed that the management / transfer / liquidation of the estate of the erstwhile Appellant No. 1, is not possible in the period granted by this Hon'ble Court to comply with the aforesaid undertaking.

A true copy of the order dated 18.07.2018 passed by this Honble Court in RFA No. 857/2017 is annexed herewith as ANNEXURE -Al.

4.1 Appellant No. IB respects the sanctity of the orders passed by this Hon'ble Court and in no manner desires to default on the undertaking recorded by this Hon'ble Court. Hence the present Application. 4.2 It is submitted that the Appellant No. lA to IC themselves do not have means to instantly deposit monies in the range of Rs. 9 crores approximately.

While the undertaking was being recorded by this Hon'ble Court on 18.07.2018, it was the bona fide belief of the Appellant No. IB that the assets (which form part of the estate of the erstwhile Appellant No. 1), could be liquidated within the time granted by this Hon'ble Court, to comply with the said undertaking."

and in CM Application No.47168/2018 the respondents averred:-

"3.2 However, due to the continued illness of the erstwhile Appellant No. 1, the said Appellants were unable to arrange the funds for complying with the condition of deposit of 50% of the decretal amount within 8 weeks.

It would not be out of place to mention that the erstwhile Appellant No.1 was severely ill and had remained mostly hospitalised for the last two years from September, 2016.

Not only was he unable to write, but his motor activity was severely affected by the Parkinsonism.

During the last quarter of2017, the erstwhile Appellant No. 1 was diagnosed with malignant cancer in the head and neck region. Since Appellant No. 1 was handling / managing the affairs of the Appellant No. 2 as its chief officer, the functioning of Appellant No. 2 was paralyzed due to the continued illness of the erstwhile Appellant No.1

3.3 Faced with such constraints, the Applicants herein filed an application on behalf of the erstwhile Appellant No. 1 requesting for modification of the order dated 23.11.2017. The Applicants herein sought the permission of this Hon'ble Court that the erstwhile Appellants be allowed to secure the decretal amount by offering marketable securities of an equivalent value in place of money. The said Application was filed by the Applicants herein on behalf of the erstwhile Appellants due to the deteriorating health of Appellant No.1.

3.4 The aforesaid application bearing No. C. M. No. 4178/2018 was heard by this Hon'ble Court on 05.02.2018 and the following order came to be passed:

Notice. Ms. Himani Sagar, Advocate accepts notice.

The appellant No. 1/applicant shall file an affidavit supporting the application. Additionally, he shall file an affidavit to the effect that the properties offered as security for the decretal amount, are without any encumbrance or lien and that the properties would be handed over to the Court Receiver Mesne profit, if any from the said properties, would be deposited in the Court. Furthermore, the applicant shall deposit original papers of properties over which he has unencumbered rights', encashable securities and cash in terms of the previous order. The Affidavit shall also specify the amount of cash which shall be readily deposited in the Court in a month's time.

The learned counsel for the appellant states that by the 10th day of each Gregorian calendar month an amount of Rs.7.5 lacs shall be deposited into respondent/Decree Holder's bank account: Punjab National Bank Account No. 0151002100010748 [IFSC Code PUNB0015100] in the name of Scindia Potteries & Sen/ices Pvt. Ltd., Punjab National Bank, Sarojini Nagar, New Delhi-23.

Any infraction in the payment of the said amount shall automatically result in payment of cost of Rs. 15,000/- to the respondent, which amount(s) too shall be deposited into the aforesaid bank account within two weeks thereafter. The arrears of Rs.7.5 lacs, payable from 17th July, 2017, shall be paid into the said bank account within five weeks from today.

Renotify on 08.03.2018.

Interim order to continue till the next date.

3.5 By the aforesaid order, this Hon'bie Court was most graciously pleased to appreciate the difficulty and constraints faced by the erstwhile Appellants and further directed the erstwhile Appellants to file an undertaking in respect of unencumbered nature of the securities being offered by them to secure 50% of the decretal amount.

3.6 However, as misfortune would have it, the erstwhile Appellant No. 1 passed away on 05.03.2018, i.e. within the time period granted for him to file the undertaking in terms of the order dated 05.02.2018.

3.9 It is submitted that the Appellant No. 1A i.e. namely Smt. Ragini Jain (widowed wife of the erstwhile Appellant No. 1), is a senior citizen and has not been keeping well. She is suffering from parkinsons, hypertension and glaucoma and she requires a personal attendant to support her for her daily chores.

The Appellant Nos.1A to 1C, in addition to the distressful mishap in their family, were faced with the obligations 7 responsibilities of seeking succession of the estate of the deceased erstwhile Appellant No. 1. As the deceased Appellant No. 1 had been unwell for a considerable period, his financial affairs were not in order and Appellant Nos. 1A to 1C were not aware of all the financial details of the deceased Appellant No. 1 at the time of his unfortunate passing away.

3.10 It is submitted that the formalities of transfer of shareholding, transfer of interest in the assets owned and managed by the erstwhile Appellant No. 1 is still in progress and has not become conclusive 4.5 That the Applicants have complied with the order of this Hon'ble Court and have filed an Affidavit to furnish security for an amount equivalent to 50% of the decretal amount on 31.08.2018."

15. It was argued the applicants being the legal heirs of deceased Dr.J. K. Jain could not be held liable for the money payable under a decree against their father and that too in excess of the estate inherited by them, hence they be not put to suffer action under the Act.

16. Admittedly on 18.07.2018 Mr.Ankur Jain, appellant No.1(b) was personally present in the Court and gave an undertaking to deposit 25% of the decretal amount with up-to-date interest thereof within two weeks and deposit another 25% with up-to-date interest within four weeks from the said date.

17. However, on 30.07.2018 CM No.30665/2018 was filed by appellants No.1(a) to 1(c) wherein further extension was sought. CM No.30665/2018 rather says appellants 1(a) to 1(c) does not have means to instantly deposit monies in the range of Rs.9.00 crores and they are trying their level best to comply with the aforesaid undertaking and rather they have an excellent case. The appellants Ms.Madhurika Jain and Ms.Ragini Jain had only asked for extension of time to deposit the amount as undertaken by Mr.Ankur Jain. Even an affidavit given by Ms.Madhurika Jain was in compliance to order dated 18.07.2018 by which order she was impleaded and Mr.Ankur Jain gave an undertaking, as he was present in the Court. Even on 01.08.2018 the learned counsel for Mr.Ankur Jain had reiterated the undertaking given by Mr.Ankur Jain.

18. Thus, on each occasion it was only Mr.Ankur Jain and/his counsel who had given/reiterated the undertaking to this Court given by Mr.Ankur Jain and that his aged mother and his sister had only filed affidavits supporting to application CM APPL No.30665/2018, which application was, primarily, for extension of time to comply with order dated 18.07.2018. Hence, Mr.Ankur Jain is guilty of contempt.

19. Another issue raised was qua the procedure to be adopted in punishing the contemnors. The learned counsel for the respondent refers to Rules to Regulate the Contempt Proceedings which are in vougue in High Court of Mumbai, in Karnataka High Court, as well as in Punjab and Haryana High Court to say rules are clear to the extent that every petition shall be posted for preliminary hearing before the appropriate Bench and if the Court is satisfied that prima facie case is made out, may direct issuance of the notice to accused in Form No.1 which shall be accompanied by the copy of petition for information etc. The accused may then file his reply duly supported by an affidavit and the Court upon its prima facie satisfaction, shall proceed to frame charge and furnish the copy of the same to the accused. If the accused pleads not guilty, the case may be taken up for trial on the same date or posted to any subsequent date as directed by the Court. These rules are in line with the Rules to Regulate the Proceedings of the Contempt of the Supreme Court 1975.

20. Reliance is also made upon Central Bank of India vs Suman Chadha and Others CONT CAS (C) No.531/2015 decided on 18.07.2017, wherein this Court held:-

47. ……….. In fact, contempt proceeding is sui generis. It has peculiar features which are not found in criminal proceedings. In this view the contemnors do not stand in the position of a person accused of an offence and the Court is free to evolve its own procedure consistent with principles of fair play and natural justice. The Supreme Court in Delhi Judicial Service Association, Tis Hazari Court, Delhi Vs. State of Gujarat & Ors., (1991) 4 SCC 406 has held so. The relevant portion of the said judgment is reproduced hereinbelow:-

‘12. .............A criminal contempt is punishable by the superior courts by fine or imprisonment, but it has many characteristics which distinguishes it from ordinary offence. An offence under the criminal jurisdiction is trial by a Magistrate or a Judge and the procedure of trial is regulated by the Code of Criminal Procedure, 1973 which provides an elaborate procedure for framing of charges, recording of evidence, cross-examination, argument and the judgment. But charge of contempt is tried on summary process without any fixed procedure as the court is free to evolve its own procedure consistent with fair play and natural justice. In contempt proceedings unlike the trial for a criminal offence no oral evidence is ordinarily recorded and the usual practice is to give evidence by affidavits......"

54. The Supreme Court in Kanwar Singh Saini Vs. High Court of Delhi, 2012 (4) SCC 307 has also clarified the position as under:-

"30. In an appropriate case where exceptional circumstances exist, the court may also resort to the provisions applicable in case of civil contempt, in case of violation/breach of undertaking/judgment/order or decree. However, before passing any final order on such application, the court must satisfy itself that there is violation of such judgment, decree, direction or order and such disobedience is wilful and intentional. Though in a case of execution of a decree, the executing court may not be bothered whether the disobedience of the decree is wilful or not and the court is bound to execute a decree whatever may be the consequence thereof. In a contempt proceeding, the alleged contemnor may satisfy the court that disobedience has been under some compelling circumstances, and in that situation, no punishment can be awarded to him. [See Niaz Mohammad v. State of Haryana, Bank of Baroda v. Sadruddin Hasan Daya and Rama Narang v. Ramesh Narang. Thus, for violation of a judgment or decree provisions of the criminal contempt are not attracted." (emphasis supplied)

21. Admittedly, in Delhi there are no such statutory rules to regulate the contempt proceedings, hence one may look at the law propounded by this Court. In Central Bank of India (supra)

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this Court itself noted:- “51. Thereafter the respondents were permitted to file their defence by way of affidavits. Consequently, the principles of natural justice have been fully complied with in the present case. It is pertinent to mention that it is the practice of this Court to hear contempt matters on affidavits and oral evidence is rarely recorded.” 22. Further in National Highways Authority of India vs You One-Maharia (JV) and Others 2010 III AD (Delhi) 717 this Court noted:- "20. In pursuance to the said show cause notice, only respondents No.1 and 8 have filed a reply affidavit in which they have primarily taken the defence that as appeals are pending against the order dated 04th April, 2005, this Court should not proceed further with the contempt proceedings. Consequently, in my view, in the present case, principles of natural justice have been complied with and the defence taken by the respondents isuntenable in law and contrary to the facts of the case. 23. In the present instance, I find that disobedience of the order dated 04th April, 2005, is wilful inasmuch as it is intentional and deliberate. In fact, despite the order dated 04th April, 2005 and the Division Bench’s order dated 13th November, 2006, respondents have taken no steps till date to comply with the mandatory directions. Consequently, I hold the respondents guilty of contempt as they have wilfully disobeyed this Court’s order dated 04th April, 2005. 24. I direct the respondents to be personally present in Court on the next date of hearing for being sentenced. In case, any of the respondents wish to state anything with regard to sentencing, they may file their affidavits within a period of four weeks from today. List on 17th May, 2010." 23. Thus, this Court may evolve its own procedure in punishing contempt. As the notice of this petition was issued and was duly replied by the appellants there was a sufficient compliance of natural justice since an opportunity to explain their conduct was given to each of the appellants. As observed above, since Mr.Ankur Jain is held guilty of contempt, hence is hereby served with a notice for his personal appearance before this Court for awarding punishment. 24. List for appearance of Mr.Ankur Jain on 24.03.2020. 25. Copy of this order be given dasti to both the parties.
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