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Thursday, November 24, 2016

contempt of court - GHANSHYAM SARDA Vs. SASHIKANT JHA, DIRECTOR M/S JK JUTE MILLS CO. LTD. & ORS.- 2016 Nov. http://judis.nic.in/supremecourt/imgst.aspx?filename=44318

                                                              Non-Reportable


                        IN THE SUPREME COURT OF INDIA


                         CIVIL ORIGINAL JURISDICTION


                  CONTEMPT PETITION (CIVIL) NO.338 OF 2014


                                     IN


                        CIVIL APPEAL NO.10221 OF 2014




      Ghanshyam Sarda                                  ……Petitioner


                                   Versus


      Sashikant Jha, Director,                                        ..….
      Respondents
      M/s JK Jute Mills Co. Ltd. & Ors.
                                    with
                   Contempt Petition (C) Nos.24-25/2015 in
                      Civil Appeal Nos.10224-10225/2014
                                    with
                    Contempt Petition (C) No.375/2014 in
                         Civil Appeal No.10223/2014
                                    with
                    Contempt Petition (C) No.307/2015 in
                         Civil Appeal No.10221/2014




                                  JUDGMENT




      Uday Umesh Lalit, J.




   1. Contempt Petition (Civil) Nos.338 of 2014  and  375  of  2014  at  the
      instance of Ghanshyam Sarda, appellant in  Civil  Appeal  No.10221  of
      2014 and J.K. Jute Mills Mazdoor Ekta Union, appellant in Civil Appeal
      No.10223  of  2014  (‘applicants’,  for  short)  seek   to   highlight
      disobedience and violation of the Order dated  08.05.2014  (“Order  of
      08.05.2014”, for short) passed by this Court in said Civil Appeals and
      other connected matters.  The text of the Order of 08.05.2014  was  to
      the following effect:-
           “Since it is not possible for us to take up  the  matter  today,
           learned senior counsel appearing for the parties seek  leave  to
           mention before the Vacation Bench for seeking urgent hearing  of
           the matter.


           Permission is granted.


           It would be open to the parties to mention before  the  Vacation
           Bench for urgent hearing of the matter.


           However, it is directed that till further orders, capital assets
           of  the  Company  shall  not  be  disposed  of  without   taking
           permission of this Court.”




2.    The aforesaid Civil Appeals had  challenged  the  judgment  and  order
dated 06.01.2014 passed by the High Court of Gauhati in FAO No.10  of  2013,
Writ Petition No.4303 of 2013 and Writ Petition No.6286 of   2013  and  were
disposed of by this Court vide its Judgment dated 13.11.2014[1].  The  facts
leading to the filing of those appeals and connected matters are dealt  with
in said Judgment dated 13.11.2014.  It is alleged in  the  present  contempt
petitions that in violation of the Order of  08.05.2014,  which  was  passed
during the pendency of the  aforesaid  Appeals,  the  assets  owned  by  the
Company, namely, J.K. Jute Mills Company Ltd. (hereinafter  referred  to  as
the Company) at Saifganj, Katihar, Bihar spread across  1.6  acres  of  land
(“Katihar property”,  for  short)  were  sold  vide  Conveyance  Deed  dated
02.07.2014 and consequently the persons  arrayed  as  contemnors  interfered
with due administration of justice.  It is prayed  that  the  contemnors  be
punished for disobeying the Order of 08.05.2014 and at  the  same  time  the
Conveyance Deed dated 02.07.2014 alienating  Katihar  property  be  declared
null and void.

      3.    The Company had filed Reference No.149 of 1994 before the  Board
      for Industrial and Financial Reconstruction  (“the  BIFR”  for  short)
      under the provisions of Sick Industrial Companies (Special Provisions)
      Act, 1985 (“Act” for short), pursuant  to  which,  various  steps  for
      revival  of  the  Company  were  being  considered.   By  order  dated
      17.12.2008  the  BIFR   had   directed   “…The   Company   would   not
      encumber/alienate/lease/sale  any  property  without  specific   prior
      approval of the Board.”  In the proceedings dated 26.08.2009, the BIFR
      had constituted Assets Sale Committee (“ASC” for short) in respect  of
      properties of the Company including Katihar property.  The proceedings
      of ASC dated 08.11.2012 of which Shri R.N. Lahoti, CEO of the  Company
      was also a member show that the sale of Katihar property was  engaging
      the attention of ASC.


      4.     The proceedings of the  BIFR  dated  07.02.2013  show  that  in
      compliance of the earlier directions, the Operating Agency was in  the
      process of finalizing a Draft Rehabilitation Scheme (“DRS” for  short)
      and in furtherance of  the  directions  of  sale  of  certain  assets,
      notices were already sent to the Company, secured creditors and  State
      of Bihar to nominate their representatives in  ASC.   The  proceedings
      further show that the Operating Agency by letter dated 29.01.2013  had
      requested the BIFR to grant permission to proceed further for sale  of
      assets of the Company situated in Bihar.  The next proceedings of  the
      BIFR dated 18.02.2013 indicate that the Operating Agency had  got  the
      assets valued and had sent notices to all parties  to  nominate  their
      representatives in the ASC.

      5.    While the matter stood thus, Auditors’ Report  dated  15.02.2013
      for the period ending 31.12.2012 stated that  the  Net  Worth  of  the
      Company had become positive. It was also mentioned in  the  Directors’
      Report dated 19.02.2013 that the Net Worth  of  the  Company  had  now
      turned positive.  Around this time, the  BIFR  vide  its  Order  dated
      26.02.2013 had formulated DRS for  the  revival  of  the  Company.  On
      28.02.2013 four advertisements were issued in prominent newspapers  by
      the Operating Agency inviting Bids  for  sale  of  properties  of  the
      Company including  Katihar property. The Reserve  Price  for   Katihar
      property was Rs.354.99 Lakhs. The advertisement stated  that  the  Bid
      documents could be obtained, inter alia, from S.K.  Jha  of  M/S  J.K.
      Jute Mills Co. Ltd, 70 Golf Links, New Delhi 110003.


      6.    When the matter was thus being considered  for  finalization  of
      DRS and for sale of assets of the Company, in the proceedings  of  the
      BIFR dated 04.04.2013 it was submitted on behalf of the  Company  that
      the Net Worth of the Company having turned positive,  BIFR  no  longer
      retained jurisdiction over the Company. The BIFR observed that as  per
      Annual Balance Sheet of the Company as on 31.03.2012 the Net worth  of
      the Company  was  Rs.5.71  Crores  and  the  accumulated  losses  were
      Rs.36.23 crores and it would like to satisfy itself about the  Balance
      Sheet as at 31.12.2012. The BIFR passed following directions:-

           “4.13. Having considered the submissions made  in  the  hearing,
           materials on record, the Bench issued the following directions:


        i) The Company to submit certified copy of its ABS as on 31-12-2012
           along with all relevant papers and documents in support  of  its
           net worth within one week from today with copy to IDBI (OA)  and
           all parties concerned along with documentary evidence;


       ii) ASC would go ahead as per its schedule and confirmation of sale,
           if any, will take place upon the approval of DRS  on  20-5-2013,
           with the consent of the Bench.


           (iii)   The Bench fixed the next date of hearing on 26-4-2013 at
           11.30 a.m. for considering the submission of  the  Company  that
           its net worth has turned positive as on 31-12-2012 and also hear
           MA No.162/BC of 2012 on the said date.”


      7.    On 16.04.2013 meeting of ASC was held but Shri. R.N. Lahoti  CEO
      of the Company did not attend. The meeting took  note  of  the  letter
      dated 16.04.20013 from the Company signed by Shri S.K.  Jha,  Director
      that their representative would not take part in the  ASC  meeting  as
      the Net worth of the Company having turned positive, it  was  no  more
      covered under the Act.   The proceedings of the BIFR dated  16.04.2013
      disclose that the BIFR had observed that manipulation of accounts  had
      been alleged against the Company and the BIFR would examine  the  same
      and enquire whether the Net Worth of the Company had  turned  positive
      or not.


      8.    At this stage, various proceedings including  those  at  Gauhati
      were instituted, as detailed in  the  Judgment  of  this  Court  dated
      13.11.2014.  In Title Suit No.166 of 2013,  Civil  Court  at  Kamroop,
      Gauhati by an interim order dated 13.05.2013 restrained the defendants
      therein including the BIFR from proceeding with  Reference  No.149  of
      1994. This Order and subsequent proceedings taken up in  Gauhati  High
      Court led to the filing of Special  Leave  Petitions  giving  rise  to
      aforementioned Civil Appeal Nos.10221 of 2014 and 10223  of  2014  and
      other connected matters in  which  this  Court  passed  the  Order  of
      08.05.2014.


      9.    During the pendency of  the  aforesaid  Civil  Appeals  in  this
      Court, aforementioned Contempt Petition Nos.338 of  2014  and  375  of
      2014  were  filed  alleging  alienation  of   Katihar  property   vide
      Conveyance  Deed  dated  02.07.2014  in  violation  of  the  Order  of
      08.05.2014.  Contempt Petition (C) No.338 of 2014  was  taken  as  the
      lead petition and the  basic  allegations  about  the  involvement  of
      various contemnors as detailed in paragraphs 4 and  7  to  14  in  the
      contempt petition are to the following effect:-
           “4. That the Contemnor Nos.1 to 3 in  conspiracy  and  collusion
           with other  Contemnors,  the  particulars  of  which  are  given
           hereinafter have after  08.05.2014  sold  away  by  executing  a
           Registered Conveyance Deed dated 02.07.2014  capital  assets  of
           the Contemnor No.1 Company being  the  land,  factory  buildings
           etc. to one M/S. Thapar Herbs  &  Spices  Pvt.  Ltd.  (Contemnor
           No.14 herein) through its Director Mr.  Mrityunjay Kumar  Singh,
           Contemnor No.17 herein (who is also the stooge and the  employee
           of the Contemnor Nos.2 and 3); hence the present Petition.


           7.  The Contemnor Nos.4 to 8, Mr. Sashi  Kant  Jha,  Mr.  Sudhir
           Kumar Singh, Mr. Rakesh Kumar Singhania and  Mr.  Sobhanand  Jha
           alias Mr. Ravishankar Prabhakar and Mr. Damodar  Prasad  Bhatter
           are the stooges and employees of Mr. Govind Sarda and Mr. Aditya
           Sarda and were/are  the  Directors  and  persons  who  with  the
           Contemnor Nos.2 and 3 are in day to day management  and  control
           of the Contemnor No.1 Company being Directors and key  employees
           of the Contemnor No.1 Company during the  relevant  period  when
           the acts of contempt have been perpetrated and  these  Contemnor
           Nos.4 to 8 were/are actively involved in consciously defying the
           orders dated 08.05.2014 passed by this Hon’ble Court.


           8.  The Contemnor No.9, Mr. Prakash Kumar, IAS is  the  District
           Magistrate and Collector  of  Katihar,  Bihar  who  despite  the
           orders dated 08.05.2014 passed by this  Hon’ble  Court  took  no
           steps in order to restrain the  sale  and  registration  of  the
           Katihar capital  assets  of  the  Contemnor  No.1  Company.  The
           Contemnor No.10 (whose name could not be ascertained  )  is  the
           Dy. Collector,  District Legal Branch, Katihar who on 31.05.2014
           sent the orders dated 21.03.2014 of the  Collector,  Katihar  to
           the  Distirict  Sub-Registrar,  Katihar  for   information   and
           necessary action. The Contemnor No.11, Mr. Sanjay  Kumar  Gwalia
           is the District Sub-Registrar  (Sub-Registry  Office),  Katihar,
           Bihar who has registered the  Conveyance  Deed  of  the  Katihar
           capital asset  of  the  Contemnor  No.1  company  on  02.07.2014
           despite being in full and complete knowledge of the orders dated
           08.05.2014 passed by this Hon’ble Court.  The  Contemnor  No.12,
           Mr. Rajender Singh is the Circle Officer, Katihar who is  taking
           steps to mutate the Katihar capital assets of the Contemnor No.1
           Company in favour of Contemnor No.14 which  is  transferred   by
           the illegal registered Conveyance  Deed  dated  02.07.2014.  The
           Contemnor No.13 is Mr. Pankaj Kumar, IAS who was  occupying  the
           post of Divisional Commissioner, Purnia Division at the relevant
           point of time and to whom letter was  sent  on  10.06.2014  (and
           duly  served  on  11.06.2014)  informing  of  the  orders  dated
           08.05.2014 passed by this Hon’ble Court and  did  not  take  any
           steps or issue any directions to the Contemnor Nos.9  to  12  to
           restrain the sale and registration of the Katihar capital assets
           of the Contemnor No.1 Company.


           9.    The  counsel  for  the  Petitioner  by  his  letter  dated
           10.06.2014 was sent to Contemnor No.11 with a copy  endorsed  to
           Contemnor Nos.9,12,13 and to Registrar of Assurance, Katihar and
           to the Chief Minister and a letter dated 13.06.2014 was sent  by
           the counsel for the petitioner to Contemnor Nos.9,11,12  and  to
           the  Finance  Minister,  Chief  Secretary  and  Asstt.  I.G.  of
           Registration and all of them given full and  complete  knowledge
           of the orders dated 08.05.2014 passed by this Hon’ble Court  but
           all of them and in particular Contemnor Nos.9,  11,  12  and  13
           showed scant regard to the same and did not take  any  steps  to
           restrain the sale and transfer and registration of  the  Katihar
           capital  asset  of  the  Contemnor  No.1  Company.  Rather,  the
           Contemnor Nos.9 to 13 showed scant regards to the  orders  dated
           08.05.2014 passed by this  Hon’ble  Court  and  facilitated  the
           sale, transfer and registration of the Katihar capital asset  of
           the Contemnor No.1 Company  in  conspiracy  and  collusion  with
           Contemnor Nos.2 to 8 and Contemnor  Nos.14  to  18  have  become
           parties to the present Contempt Petition.


           10.   The Contemnor No.14 is M/s. Thapar Herbs and  Spices  Pvt.
           Ltd., which is a company owned and controlled by  the  Contemnor
           No.2 and which has purchased the Katihar capital  asset  of  the
           Contemnor  No.1  Company  in  violation  of  the   order   dated
           08.05.2014 passed by this Hon’ble Court. Contemnor No.15 is  Mr.
           Krishan Kumar, Contemnor No.16 is Mr. Rakesh Kabra and Contemnor
           No.17 is Mr. Mritunjay Kumar Singh who are also the Directors of
           the Contemnor No.14 Company and are the employees/stooges of Mr.
           Govind Kumar Sarda (Contemnor No.2) who have acted in  collusion
           and conspiracy with the Contemnor Nos.1 to  13  consciously  and
           with full and complete knowledge of  the  facts  defied/violated
           the orders dated 08.05.2014 passed by this Hon’ble Court.


           11.    That  in  willful  disobedience  to  the   orders   dated
           08.05.2014 passed by this Hon’ble Court, the Contemnor Nos.1  to
           8 in collusion and conspiracy with the Contemnor Nos.9 to 13 and
           in willful disobedience of the orders dated 08.05.2014 sold away
           the Katihar capital assets of the Contemnor No.1 Company to  the
           Contemnor No.14 Company (which  is  managed  and  controlled  by
           Contemnor Nos.2 and 3) for a paltry sum  of  Rs.3.55  crores  as
           against the Circle rate of Rs.15.37 crores  whereas  the  market
           value is above Rs.20 crores.  It is submitted that:-


              i) Contemnor No.14 through  one  of  its  Directors  i.e.  Mr.
                 Mrityunjay Kumar Singh, Contemnor No.17 (who is an employee
                 of the Contemnor No.2 and works  at  70,  Golf  Links,  New
                 Delhi office of the Contemnor Nos.1 to 3) filed application
                 before  the  Contemnor   No.11   (District   Sub-Registrar,
                 Katihar) for transfer of the Katihar capital asset  of  the
                 Contemnor No.1 Company.   This  application  was  dismissed
                 vide orders dated 28.10.2013.




             ii) On an appeal filed by the Contemnor No.14  Company  through
                 Contemnor  No.17  before  the  Contemnor   No.9   (District
                 Magistrate & Collector, Katihar) being Registration  Appeal
                 Case  No.235/13-14  the  Collector,  Katihar,   inter-alia,
                 passed   the  following  orders  on   21.03.2014   (English
                 translation):-


                            “From the aforesaid facts it is clear that  the
                       land under reference  is  Reyati  Land  (belonged  to
                       Juggi Lal Kamlapati Company, Katihar).   Therein  the
                       Government  has  no  vested  interest.   Accordingly,
                       there appears to  be  no  purpose  for  stay  of  its
                       registration.  Therefore the District  Sub-Registrar,
                       Katihar is free for conducting the proceedings  under
                       the Registration Act and the Rules framed  under  it.
                       With this order  the  present  case  hereby  disposed
                       off.”
                       ……………………………………………………..


            iii) As  stated  above,  this  Hon’ble  Court  by  orders  dated
                 08.05.2014  directed  that  till  further  orders,  capital
                 assets of the company shall  not  be  disposed  of  without
                 taking permission of this Hon’ble Court.




             iv) On  31.05.2014,  the  Contemnor  No.10,  Deputy  Collector,
                 District  Legal  Branch,   Katihar   made   the   following
                 endorsement  (English  translation)  on  the  orders  dated
                 21.03.2014 passed by the Contemnor No.9  to  the  Contemnor
                 No.11:-




                       “Memo 1346/Law, dated 31.05.2014
                       Copy   to   District   Sub-Registrar,   Katihar   for
                       information and necessary action.”


              v) On coming to know of the fact that the  Contemnors  are  in
                 the process of illegally selling away the  Katihar  capital
                 asset of the Contemnor No.1 Company to the Contemnor  No.14
                 Company (being the company controlled and  managed  by  the
                 Contemnor Nos.2 and 3), the petitioner through its  counsel
                 wrote a letter dated 10.06.2014 to the District  Magistrate
                 & Collector and brought to his notice the orders passed  by
                 the Allahabad High Court and this Hon’ble  Court  regarding
                 restraint order on the sale of land  and  property  of  the
                 Contemnor No.1 Company…………………….




             vi) The counsel for the petitioner also  wrote  another  letter
                 dated 10.06.2014 to the Contemnor No.10, with copy endorsed
                 to the Contemnor No.9, 12,  13  and  to  the  Registrar  of
                 Assurance,  Dist.  Katihar  and  the  Chief  Minister   and
                 specifically pointed out the restraint orders passed by the
                 Allahabad High Court and by this Hon’ble Court and enclosed
                 the copy of the said  orders  alongwith  the  letter  dated
                 10.06.2014.  …………………………


            vii) Thereafter, the counsel for the Petitioner wrote  a  letter
                 dated 13.06.2014 to Contemnor Nos.9,  11,  12  and  to  the
                 Finance  Minister,  Chief  Secretary  and  Asstt.  I.G.  of
                 Registration specifically  bringing  to  their  notice  the
                 orders dated 8.05.2014 passed by  this  Hon’ble  Court  and
                 requested that  the  Conveyance  Deed  in  respect  of  the
                 Katihar capital asset be not registered.  ………………..


           viii) Despite the letters dated 10.06.2014 and 13.06.2014 of  the
                 counsel for the Petitioner bringing to the  notice  of  the
                 Contemnor Nos.9 to 13 of the orders dated 08.05.2014 passed
                 by this Hon’ble Court, the Contemnor Nos.1 to 17 in willful
                 disobedience  proceeded  ahead  with  the  process  of  the
                 registering the  Conveyance  Deed  in  respect  of  Katihar
                 capital asset of  the  Contemnor  No.1  Company  and  by  a
                 Registered Conveyance Deed dated  02.07.2014  conveyed  the
                 Katihar capital asset of the Contemnor No.1 Company to  the
                 Contemnor No.14 Company (which is owned and  controlled  by
                 Contemnor Nos.2 and 3) for a paltry sum of  Rs.3.55  crores
                 as against the Circle rate of Rs.15.37 crores  whereas  the
                 market     value      is      above      Rs.20      crores.
                 ……………………………………………………………


           12.    Another  instance  of  fraud  and  back-dating   of   the
           Conveyance Deed is evident from the  fact  that  the  Conveyance
           Deed is signed by one Mr.  Sobhanand  Jha  (Contemnor  No.7)  as
           Director of Contemnor No.1 Company but as on  the  date  of  the
           signing and/or execution of  the  Conveyance  Deed,  he  had  on
           17.02.2014 resigned as a Director of the Contemnor No.1 Company.
            The said Mr. Sobhanand Jha long back changed his  name  to  Mr.
           Ravishankar Prabhakar and got his name changed  in  the  records
           with  the  Registrar  of  Companies  but  he  still  signed  the
           Conveyance Deed on behalf of the Contemnor  No.1  Company  as  a
           Director  with  his  name  written   as   Mr.   Sobhanand   Jha.
           ……………………………………………………………


           13.   That the  Contemnor  Nos.1  to  17  have  thus  willfully,
           consciously  and  contumaciously  and  with  full  and  complete
           knowledge violated and disobeyed  the  orders  dated  08.05.2014
           passed by this Hon’ble Court in SLP(Civil) No.5249 of  2014  and
           as such each one of Contemnors have made themselves jointly  and
           severally liable to be punished for the contempt of  the  orders
           passed by this Hon’ble Court.


           14.   That the subject matter of the Katihar  capital  asset  is
           part of the scheme  before  the  BIFR  and  in  respect  of  the
           permissions granted for sale of the Katihar capital  assets  and
           other assets of the Contemnor No.1 Company on  an  appeal  being
           Special Appeal No.539 of 2013 filed before  the  Allahabad  High
           Court, the Allahabad High Court by orders dated  15.04.2013  and
           16.04.2013 passed directing that the bid already received by the
           Asset Sale Committee (ASC) will not  be  opened  till  the  next
           date…………………………………………………………….





      10.     By its Judgment  dated  13.11.2014,  this  Court  allowed  the
      aforesaid appeals and set aside the judgment of  Gauhati  High  Court.
      It was observed:-

           “…When all the financial affairs of such company  were  directly
           under the supervisory control  of  BIFR,  the  power  to  decide
           whether it has since then lost the jurisdiction or not, is  also
           in the exclusive domain of BIFR.  BIFR  alone  is  empowered  to
           determine whether net worth has become positive as a  result  of
           which it would cease to have such jurisdiction. Any inquiry into
           such issue  regarding  net  worth  by  anyone  outside  the  Act
           including civil court, would be against the  express  intent  of
           the Act and would lead to incongruous and undesired results.”




           This Court relegated the matter to the BIFR to determine whether
      the Net Worth of the Company had turned positive. Since the alienation
      dated 02.07.2014 was effected without the express leave of  the  BIFR,
      that part of the matter was also left for BIFR to consider,  as  would
      be evident from paragraphs 37 and 38 of the judgment:-


           “37.  In the circumstances, we allow the present appeals and set
           aside the order dated 06-01-2014 passed by  the  High  Court  of
           Gauhati in Ghanshyam Sarda v. Shiv Shankar  Trading  Co.  It  is
           held that Title Suit No.166 of 2013 pending on the file  of  the
           learned Civil Court at  Kamroop,  Gauhati  is  not  maintainable
           insofar as it seeks declaration that the Company was no longer a
           sick company within the meaning of the Act and that BIFR  ceased
           to  have  jurisdiction  over  the  Company  and  that  all   the
           proceedings in BIFR after filing of the positive  balance  sheet
           were without jurisdiction. Consequently the order of  injunction
           passed by the civil court is set aside. Insofar as the said suit
           pertains to the claim for recovery of money  from  the  Company,
           the suit could lie and be  proceeded  with  only  after  express
           consent of BIFR is received by the plaintiff. We direct that the
           Company i.e. J.K. Jute Mills  Co.  Ltd.  having  its  registered
           office at Kanpur, U.P. continues to be under the jurisdiction of
           BIFR. We leave it to BIFR to satisfy itself  and  determine  the
           issues whether the net worth of the Company has turned  positive
           or not. If BIFR is so satisfied, it shall deregister the Company
           and upon such  declaration  the  Company  will  be  out  of  the
           supervisory jurisdiction of BIFR under the Act. Needless to  say
           that if BIFR is not satisfied that the net worth of the  Company
           has turned positive, it shall go ahead and consider  the  scheme
           for revival of the Company. We  direct  BIFR  to  complete  this
           exercise within two months from the  date  of  receipt  of  this
           order. We have refrained from dealing with the matter concerning
           the merits or demerits of the  claim  that  the  net  worth  has
           turned positive nor have we dealt with the report made by  State
           Bank of India in its special investigative audit. We leave these
           issues to be considered by BIFR at an appropriate stage. We have
           also not dealt with the submissions alleging bias as the matters
           in that  behalf  are  still  pending  consideration  before  the
           authorities and we leave these issues to be  dealt  with  at  an
           appropriate stage.


           38. Since in our view the Company continues to be a sick company
           and it was not competent for anyone  except  BIFR  to  determine
           whether the net worth of the Company  had  turned  positive,  we
           hold the sale  of  Katihar  property  effected  by  the  Company
           without express leave or permission of BIFR to be  questionable.
           However, since the transferee of that  property  is  not  before
           this Court we relegate this matter for appropriate assessment by
           BIFR after issuing due notice to the transferee. We  also  leave
           it to  BIFR  to  consider  and  assess  whether  there  was  any
           necessity or expediency to sell the property in question. If  in
           its opinion such expediency and necessity are established,  BIFR
           may also consider  whether  the  value  that  the  property  has
           fetched is adequate or not. If the  value  is  adequate  it  may
           confirm the sale in favour of the transferee.  However,  if  the
           value in its opinion is inadequate,  it  shall  give  offer  and
           adequate time to the transferee to make good the deficit. In any
           case if the sale is held to be bad or if the transferee  is  not
           willing to make good the deficit, the entire  consideration  for
           the  transaction  be  returned  to  the  transferee.   In   such
           eventuality whatever the transferee has paid in  excess  of  the
           consideration money towards stamp duty and registration shall be
           recovered  from  the  Directors  and  persons  responsible   for
           effecting such sale on behalf of the Company.”




      11.   Thus, the infirmity in the transfer or alienation of  assets  of
      the Company found by this Court was on account of absence  of  express
      leave or permission of the BIFR. Further,  the  transferee  not  being
      party to the proceedings before this Court, the matter was directed to
      be considered after giving it hearing  and  opportunity.  The  present
      Contempt Petitions were not dealt with and notices were directed to be
      issued by a separate order passed on 13.11.2014.


      12.   Pursuant to such notices, the  alleged  contemnors  filed  their
      responses as under:-
           A.    In his reply which was also on behalf of the Company, Shri
           Shashikant Jha, Director submitted  that  Katihar  property  was
           sold and transferred to  alleged Contemnor No.14  on  04.04.2013
           for consideration of Rs.3.55 crores, long before the  filing  of
           the matter in this Court and passing of the Order of 08.05.2014.
            It was submitted that the entire consideration was received  by
           the Company on 04.04.2013 by cheques and constructive possession
           was also handed over to the purchaser on 16.04.2013.  The  reply
           further stated:-


                  “The  deed  was  presented  for  registration  before  the
            Registrar on 16.04.2014. As  per  the  Revenue  Department,  the
            stamp duty payable was higher than affixed and accordingly,  the
            matter was pending adjudication. It  is  only  thereafter,  that
            this Hon’ble Court had passed the interim Order dated 08.05.2014
            restraining the Company from disposing off capital assets of the
            Company without taking permission from  the  Hon’ble  Court.  By
            this time, the  property  in  question  had  for  all  practical
            purposes already been transferred. Only, the ministerial act  of
            actual registration by the  Authority  concerned  was  remaining
            which also was being pursued by the purchaser, it  is  submitted
            that vide board resolution dated  06.02.2013  an  authority  had
            been given by the Company to the alleged Contemnor  No.7  herein
            to sign and execute the sale  deed.  Subsequently,  the  alleged
            contemnor  No.7  had  resigned  from  the  directorship  of  the
            Company. The alleged Contemnor  No.7  was  called  upon  by  the
            purchaser for getting the sale deed registered. Therefore, there
            was no willful or deliberate  violation  of  the  interim  Order
            dated 08.05.2014 passed by this Hon’ble Court. ”


           B.     In  his  reply,  alleged  Contemnor  No.2  Govind   Sarda
           submitted that he was not a party to the proceedings disposed of
           by this Court vide Judgment dated 13.11.2014. It was denied that
           the Company belonged to or was being managed by him or  his  son
           or that  Katihar property was sold away  by  him  in  conspiracy
           with other contemnors. Similarly in his reply, alleged Contemnor
           No.3 Aditya Sarda submitted that he was  neither  a  shareholder
           nor a director in the Company nor did  he  have  any  connection
           with the management of the Company. It was denied that he  along
           with other contemnors, in  conspiracy  had  sold  away   Katihar
           property.


           C.    In his reply alleged Contemnor No.6 Rakesh  Kr.  Singhania
           submitted that Katihar property was transferred well before  the
           Order  of  08.05.2014.  Alleged  Contemnor  No.8,  D.P.  Bhattar
           another Director of the Company submitted on same lines. Alleged
           Contemnor No.7 Shobhanand Jha  who  had  executed  the  Deed  on
           behalf of the Company,  submitted:-
                 “That the Respondent herein  has  not  violated  the  Order
           dated 8.5.2014 passed by this Hon’ble Court.  In  fact,  he  had
           resigned as Director of JK Jute Mills Ltd. On 17.02.2014 because
           of personal reasons and was subsequently, not in touch with  the
           Company.  He was not aware of the Order dated 08.05.2014  passed
           by this Hon’ble Court.  The Respondent had  been  authorized  by
           the Board of Directors to execute the sale deed  to  be  entered
           into between the company and M/s Thapar Herbs & Spices (P)  Ltd.
           When he was a Director  of  the  company.   The  sale  deed  was
           executed on 03.04.2013 under the answering respondents signature
           and the sale  consideration  was  received  by  the  company  on
           04.04.2013 itself.  Symbolic possession of the property was also
           handed  over  on  16.04.2013.   The  deed  was   presented   for
           registration by the buyer on 16.04.2013 but as the stamp duty as
           assessed by the revenue authorities was on the higher side,  the
           registration of the deed did not take place.   The  buyer  after
           certain correspondences with the revenue authorities was able to
           reduce the value of stamp duty payable on such registration.  As
           a considerable time of more than one year had elapsed, the buyer
           had contacted the answering  respondent  to  get  a  fresh  deed
           executed and to get  the  same  registered.   As  the  answering
           respondent had been given the authority which  was  not  revoked
           till then the answering respondent on good  faith  executed  the
           fresh sale deed which was presented  for  registration  and  was
           finally registered on 02.07.2014.  As the  answering  respondent
           had resigned from the Directorship of the company he was unaware
           of any orders being passed in the  meantime  and  was  also  not
           served by a copy of the said order.  In  any  event  the  entire
           exercise of sale was completed in 2013 itself when the deed  was
           executed, payment received and possession handed over.”


           In his supplementary affidavit Shobhanand Jha further submitted:-




           “1.   That on 02.07.2014 at the  time  of  registration  of  the
           conveyance deed I had produced  the  authorization  being  board
           resolution of 06.02.2013 given in my favour by the Board of J  K
           Jute Mills Co. Ltd.


             2.    That  although  the  sale  deed  of  2014  mentions   my
           designation as Director, it is a typographical error  and  which
           has been carried forward from the earlier  sale  deed  of  April
           2013 and nothing more. It was not my intention to show myself as
           Director of JK Jute Mills Co. Ltd. at the time  of  registration
           as I had resigned from the Board of Directors in February, 2014.
           The only authorization in my favour was  the  one  mentioned  in
           para 1 above. “




           D.    Alleged Contemnor No.10, Mohammad  Istaba  Husain,  Senior
           Deputy Collector, Gaya submitted that soon after receipt of  the
           letter dated 10.06.2014 sent by the Counsel  for  the  appellant
           along with copy of the order dated  08.05.2014  passed  by  this
           Court, he had ensured that the same was sent  to  the  concerned
           Sub-Registrar to take necessary action as per Rules vide  letter
           dated 26.06.2014.  However, despite such letter  the  Sale  Deed
           was registered on  02.07.2014  whereafter  charges  were  framed
           against District  Sub-Registrar,  Katihar  and  Circle  Officer,
           Katihar for  disobeying  the  order  passed  by  this  Court  on
           08.05.2014.  In his reply alleged Contemnor No.11, Sanjay  Kumar
           Gwalia, District Sub-Registrar, Katihar submitted  that  he  was
           not a party to the proceedings before this Court,  that  he  was
           bound to act under the provisions of  the  Registration  Act  in
           connection with registration of documents.  He further submitted
           that in view of the prevalent opinion from  the  office  of  the
           Advocate General, Bihar that the Registering Authorities, if not
           parties to the proceedings, are  bound  to  register   documents
           submitted  for  registration,  he  had  sought  opinion  of  the
           Government Pleader on 30.06.2014.  The  opinion  was  thereafter
           given by the Government Pleader, Katihar on 01.07.2014 that  the
           documents could be registered,  whereafter  the  Sale  Deed  was
           registered on 02.07.2014.   Alleged  Contemnor  No.12,  Rajendra
           Singh, the then Circle Officer in his reply  submitted  that  he
           had  caused  mutation  to  be  effected  in  pursuance  of   the
           registration of document and mutation by itself did  not  confer
           any title upon the transferee.  Alleged Contemnor No.13,  Pankaj
           Kumar,   Secretary   Registration,   Excise   and    Prohibition
           Department, Government of Bihar  denied  having  any  connection
           with the violation of the Order of 08.05.2014.


           E.    In their common reply, alleged  Contemnor  Nos.14  and  17
           submitted that the transfer under the document dated  02.07.2014
           was a bonafide purchase for consideration, that the property was
           already in the possession of the transferee under  a  long  term
           lease and that the transferee had no knowledge about  the  Order
           of  08.05.2014   nor  was  that  order  ever  served  upon   the
           transferee.   It  was  denied  that  the  transferee   had   any
           connection with alleged Contemnor  Nos.2  and  3.   The  replies
           filed by alleged Contemnor Nos.15 and 16  were  to  the  similar
           effect denying knowledge about the Order of 08.05.2014.

13.   The applicants filed their rejoinder affidavits to the  replies  filed
by all the alleged contemnors. As regards the  reply  of  alleged  Contemnor
No.17 Mrityunjay Kumar Singh,  it  was  submitted  that  he  was  authorized
respresentative of the Company  as  well  as   Director  in  the  transferee
company.  Reliance was placed on   the  authority  letter  dated  17.06.2013
issued by the Company authorizing said alleged Contemnor  No.17  to  collect
certified copies of the  orders  from  the  office  of  the  BIFR.   It  was
submitted that he being privy to the proceedings before the BIFR  and  being
aware of the Order of 08.05.2014, ought not to have registered the  document
on 02.07.2014.  In  his  subsequent  affidavit  dated  27.01.2016,   alleged
Contemnor No.17 submitted that he directly worked  under  alleged  Contemnor
Nos.2 and 3 and that he used to sign documents on  their  instructions.   He
submitted as under:
           “I wish to further state that I,  under  instructions  from  Mr.
           Aditya Sarda, had visited Katihar twice.  My first visit was  in
           the month of May, 2014 for 15 days and second time in  the  last
           week of June 2014.  The first time in May 2014 I was accompanied
           by Mr. Sashi  Kant  Jha  and  second  time  in  June  2014  with
           Shobhanand Jha, both employees of Mr.  Govind  Sarda.   In  June
           2014, on reaching Katihar I and Mr. Shobhanand Jha met by  Shri.
           Damodar Prasad Bhatter another employee of Mr. Govind Sarda  and
           Mr. Aditya Sarda.  I stayed in Katihar for a week.  During  both
           my visits I was told that I had to sign some documents;  details
           of which were not disclosed to me.


           e.    That on 02.07.2014, I and Mr. Sobhanand Jha signed certain
           documents before the Registrar’s office on the  instructions  of
           Mr. Aditya Sarda.  I did not have any occasion to read the  said
           document nor was I aware of the contents of  the  said  document
           and the particulars of the property in respect of the sale  deed
           was signed by me.  After putting the signature, photographs were
           taken.  Thereafter, I returned to Delhi and informed Mr.  Aditya
           Sarda that the papers had been signed.”


14.   During the pendency of these contempt petitions, IA Nos.9 and  10   of
2016 were filed by  the  applicants  inviting  attention  of  the  Court  to
proceedings in Calcutta High Court,  namely,  Writ  Petition  No.5670(W)  of
2016 filed by one  Dinesh Sarda.  It was submitted that  said  Dinesh  Sarda
was a Chartered Accountant who used to work for alleged Contemnor Nos.2  and
3.  Relying on certain  documents  filed  in  said  writ  petition,  it  was
submitted that alleged Contemnor Nos.2 and 3  were  exercising  control  and
management over the transferee company and that the transaction in  question
registered on 02.07.2014 was a device  employed  by  them.  It  was  further
submitted that these documents indicate the involvement of the said  alleged
Contemnor Nos.2 and 3 and established that they were  the  key  conspirators
on whose instructions the transaction was entered  into  and  registered  on
02.07.2014.    Concerned parties including alleged  Contemnor  Nos.2  and  3
filed their  responses  to  I.A.  Nos.9  and  10  of  2016  and  denied  the
allegations.

15.   We heard M/s Krishnan  Venugopal,  Amit  S.  Chadha  and  Sanjiv  Sen,
learned Senior Advocates in support of these contempt  petitions.   We  also
heard M/s Ram Jhethmalani,  Vikas  Singh,  V.  Giri,  Nidesh  Gupta,  Jayant
Bhushan, learned Senior Advocates and Mr. Braj K. Mishra,  learned  Advocate
who appeared on behalf of alleged contemnors.   We  have  gone  through  the
record and considered the rival submissions.

16.   The first question that arises is whether any alienation  or  transfer
was effected after the Order of 08.05.2014.The submission  of  the   alleged
contemnors is that the conveyance deed was executed on 04.04.2013  on  which
date the entire  consideration  stood  paid   by  the  transferee   and  was
credited to the account of  the  Company and as such  the  title  passed  in
favour of the transferee well before the Order of 08.05.2014 and   what  was
done on 02.07.2014 was a mere ministerial act.   According  to  the  alleged
contemnors, the documents presented for registration in April 2013 were  not
accepted for want of adequate stamp and registration  fees.  This  infirmity
was removed and the documents were then presented for registration. In  such
circumstances the order of 08.05.2014 was not in any way violated by them.

17.   The Order of 08.05.2014 had directed “….capital assets of the  company
shall not be disposed of without taking  permission  of  this  Court”.   The
expression “shall not  be  disposed”  in  the  context  connotes  action  or
process of sale of assets.  Going by Section 54 of the Transfer of  Property
Act, 1882, transfer of any tangible  immovable  property  of  the  value  of
Rupees hundred and upwards can be made  only  by  a  registered  instrument.
The expression ‘only’ in the Section  is  significant.  The  transfer  comes
into  effect  and  becomes  valid  and  effective  only  by   a   registered
instrument.   It is true that the document was sought to  be  registered  in
April, 2013 but the registration in  question  was  duly  effected  only  on
02.07.2014.    In the eyes  of  law,  it  is  this  document  registered  on
02.07.2014  which  alone  effectuates  transfer  of  interest  in    Katihar
property in favour of the transferee.  The transfer  was  thus  effected  on
02.07.2014 i.e. well after the Order  of  08.05.2014.    In   Suraj  Lamp  &
Industries Pvt. Ltd.  v State of Haryana and  another[2],   this  Court  had
observed as under:
           “19.  Any contract of sale (agreement to sell) which  is  not  a
           registered deed of conveyance (deed of sale) would fall short of
           the requirements of Sections 54 and 55 of the TP  Act  and  will
           not confer any title nor transfer any interest in  an  immovable
           property (except to the limited right granted under Section 53-A
           of the TP Act). According to the TP Act, an agreement  of  sale,
           whether  with  possession  or  without  possession,  is  not   a
           conveyance. Section 54  of  the  TP  Act  enacts  that  sale  of
           immovable property can be made only by a  registered  instrument
           and an agreement of sale does not create any interest or  charge
           on its subject-matter.”




18.   The document dated 04.04.2013 did not by itself  create  any  interest
nor did the title pass upon execution of such document on 04.04.2013 but  it
was only after the registration on  02.07.2014 that the  title  in   Katihar
property passed from  the  Company  in  favour  of  the  transferee.     The
submission of the contemnors however, is that by virtue  of  Section  47  of
the  Registration  Act,  the  document  in  question  would   operate   from
04.04.2013.  In our view, the  principle  embodied  in  Section  47  of  the
Registration Act is completely for different purposes.   In so  far  as  the
issue of transfer is concerned, Section 54 of the Transfer of  Property  Act
is the governing principle,  which  is  quite  clear.  It  is  the  date  of
registration of document which  is  crucial  inasmuch  as  the  transfer  is
effected and the title passes only upon registration.  Viewed  thus,  it  is
clear that  Katihar property was transferred in the teeth of  the  Order  of
08.05.2014 and ex facie there has been violation  of  the  Order  passed  by
this Court.  It is crucial to note  that  on  08.05.2014,  the  company  had
appeared on caveat before this Court and  certainly  had  express  knowledge
about the Order of 08.05.2014.  It was party  to  the  proceedings  and  was
bound by the order passed by this Court in every respect.

19.   The submission on  part  of  alleged  Contemnor  Nos.1,4,5,6,7  and  8
namely the Company and its directors/servants  is  that  the  document   was
executed by alleged  Contemnor  No.7  Sobhanand  Jha  in  pursuance  of  the
authority given to him by the  Company  way  back  on  06.02.2013.    As  on
06.02.2013, the company was definitely a  sick  company  and  the  Reference
was pending before the BIFR.  Around  that  time  the  ASC  was  constituted
which was considering sale of assets including  Katihar  property.   It  was
only after the Auditors’ report dated 15.02.2013 that  the  Company  started
projecting that its net worth  had  become  positive  on  which  account  it
ceased to be governed under the provisions of the Act and  was  outside  the
jurisdiction of the BIFR.   Though this Court rejected  such  submission  in
its judgment  dated  13.11.2014,  at  this  stage  we  are  considering  the
bonafides and tenability of the assertions made by the  alleged  contemnors.
There could not have been any occasion for the  Company  before  19.02.2013,
even accepting the submission that  it  ceased  to  be  a  sick  company  as
alleged, to enable the Company to execute  an  authority  on  06.02.2013  in
favour of alleged Contemnor No.7.   That authorization is  wholly  defective
and unsustainable. It is not the case of the alleged contemnors  that  after
the adoption of the Auditors’ Report and Directors’ Report dated  19.02.2013
a decision was taken by the Company  to  sell  or  dispose  of  its  Katihar
property in pursuance of which due authorization was given  to  a  competent
person to execute the documents on behalf of the Company.

20.   Further, the facts on record disclose that said Sobhanand Jha  changed
his name to R.S. Prabhakar on and with effect  from  18.03.2013.    However,
the document mentioned  his  name  as  Sobhanand  Jha  which  he  signed  as
Sobhanand Jha on 04.04.2013. He tendered his resignation  on  17.02.2014  as
R.S. Prabhakar.   Despite  such  resignation,  he  thereafter  executed  the
document on 02.07.2014 in the name of Sobhanand Jha and signed as  Sobhanand
Jha.  In any event of the matter as on 02.07.2014,  the  person  was  not  a
Director of the Company. He submitted that the  Company  had  given  him  an
authority way  back  on  06.02.2013  pursuant  to  which  the  document  was
executed on 04.04.2013 on which date the sale  for  all  practical  purposes
stood completed and what remained was only a ministerial act which was  done
by him independently of the Company on 02.07.2014.  It is on  the  basis  of
this submission that the Company as well as  its  Directors/servants  namely
alleged Contemnor Nos.4, 5, 6 and 8 seek to wriggle themselves  out  of  any
liability for violation of Order of 08.05.2014.   If the  order  was  passed
on 08.05.2014 restraining any  alienation  of  the  capital  assets  of  the
Company, the Directors/servants of the company ought to have taken steps  to
inform alleged Contemnor No.7 to refrain from registering  the  document  on
02.07.2014. Neither such steps were taken nor  was  the  Court  informed  on
08.05.2014  about the document executed on 04.04.2013, in which  event  this
Court  could  have  passed  appropriate  Orders   including   restraint   on
registration. Similarly,  if  Sobhanand  Jha,  alleged  Contemnor  No.7  had
resigned on 17.02.2014, he had no authority  to  register  the  document  on
behalf of the Company.  In our  view,  the  entire  exercise  was  a  clever
device employed by  the  Company  and  its  Directors,  in  that,  first  an
authority in favour of a Director was created who then resigned as  Director
but  continued  to  register  the  document  on  the  basis   of   erstwhile
authorization and at the same time the person having  resigned  could  claim
lack of knowledge of the Order of restraint  passed  by  this  Court.  Their
actions were deliberate and designed to flout the  Order  of  08.05.2014.The
involvement of alleged Contemnor Nos.1,4,5,6,7 and 8  in  the  transfer  the
assets of the Company in the teeth  of  the  Order  of  08.05.2014  is  thus
apparent and clear.

      21.   We now turn to the involvement of those officials concerned with
      registration, who went ahead and registered the document on 02.07.2014
      despite having been put to notice and served with a copy of the  Order
      of 08.05.2014.  Our attention has been invited to the opinion rendered
      by the office of the Advocate General, Bihar to the effect  that  even
      if there be any order passed by  a civil court in  connection  with  a
      private dispute between the parties, the registering  authorities  are
      bound to register a document presented for registration.  This opinion
      was relied upon by the Government Advocate who then  opined  that  the
      document in the present case could be  registered.   The  request  was
      allegedly made  on  30.06.2014  and  the  opinion  of  the  Government
      Advocate was promptly given  on  01.07.2014.   There  is  no  register
      maintained diarizing the inward and outward letters  and  prima  facie
      the entire theory appears to be suspicious and designed  to  confer  a
      favour.  However, since these are government servants, we  grant  them
      benefit of doubt and would only caution them.   It is shocking that an
      order passed by this Court, in the face of the provisions  of  Article
      142 of the Constitution,  could  be  ignored  or  disregarded  by  the
      officials who went ahead and registered the document.  However, we  do
      not find sufficient grounds to invoke our  Contempt  Jurisdiction   to
      punish them for violation of the Order of 08.05.2014.

      22.   We now turn to the involvement of alleged Contemnor  Nos.14,  15
      and 16 who are the  transferee  Company  and  its  Directors/servants.
      These alleged contemnors  were  neither  parties  to  the  proceedings
      pending in this Court in which Order of 08.05.2014 was passed  nor  is
      there any material to indicate that such order was ever served on them
      or brought to the notice of these alleged contemnors.  The role played
      by alleged Contemnor No.17, however, stands on  a  different  footing.
      The documents on record do show that he used to represent the  Company
      and was also given authority to collect documents  on  behalf  of  the
      Company from the office of the BIFR.  Further, on his own showing,  he
      had gone ahead and registered the document not on the  asking  of  the
      transferee.  He had gone along with the Directors of the  Company  and
      on the directions of alleged Contemnor No.3.  The knowledge about  the
      passing of Order of 08.05.2014 to the Company and its Directors having
      been established, there is room  for  suspecting  the  involvement  of
      alleged Contemnor No.17.  But mere suspicion may not be enough and  we
      give him benefit of doubt. Thus, none of the alleged Contemnor  Nos.14
      to 17 have  been  proved  to  be  guilty  of  violation  of  Order  of
      08.05.2014.

      23.   As regards the involvement of alleged  Contemnor  Nos.2  and  3,
      they were neither Directors nor Shareholders of the Company nor has it
      been shown that they have any stake  or  interest  in  the  Transferee
      Company.  It is undoubtedly true that alleged Contemnor No.17  in  his
      affidavit stated that he used to work under the directions of  alleged
      Contemnor Nos.2 and 3 and that the registration  of  the  document  on
      02.07.2014 was done under the express directions and alleged Contemnor
      No.3.  However, such a statement coming from a  co-contemnor,  in  our
      view, is not sufficient to reach a conclusion about the involvement of
      alleged Contemnor No.3.  Further, the  documents  pertaining  to  Writ
      Petition No.5670 (W) of 2016 pending in Calcutta High Court as well as
      the affidavit filed by Dinesh Sarda are also  not  conclusive  enough.
      The criticism that such documents and the affidavit  of  Dinesh  Sarda
      are conveniently brought on record, would also require  assessment  of
      facts. Thus, though there is room to suspect the involvement  of  said
      Contemnor Nos.2 and 3, the material on record is not conclusive enough
      to hold  them  guilty  of  violation  of  Order  of  08.05.2015.   We,
      therefore, close these proceedings as against them.

      24.   We now come to the crucial question as to the effect of transfer
      or alienation of  Katihar  property  in  violation  of  the  Order  of
      08.05.2014.  The law on the point is well settled in the  decision  of
      this Court in D.D.A. v. Skipper  Construction  Co.  (P)  Ltd.[3]  that
      legal consequences of what has been done in breach of or in  violation
      of the order of stay or injunction can be undone and the parties could
      be put back to the same position as they stood  immediately  prior  to
      such order of stay or injunction.  Paragraphs 18 to 21 of the decision
      in D.D.A. v. Skipper Construction  Co.  (P)  Ltd.  (supra)  are  quite
      instructive and are:-
              “18. The above principle has been applied even in the case of
           violation of orders of injunction issued  by  civil  courts.  In
           Clarke v. Chadbur (1985)1 All ER  211  Sir  Robert  Megarry  V-C
           observed:


              “I need not cite authority for the proposition that it is  of
           high importance that orders  of  the  court  should  be  obeyed.
           Wilful disobedience to an order of the court is punishable as  a
           contempt of court, and I feel no doubt  that  such  disobedience
           may  properly  be  described  as  being  illegal.  If  by   such
           disobedience the persons enjoined claim that they  have  validly
           effected some charge in the rights and liabilities of others,  I
           cannot see why it should be said that although they  are  liable
           to penalties for contempt of court  for  doing  what  they  did,
           nevertheless those acts were validly done. Of course, if an  act
           is done, it is not undone merely by pointing  out  that  it  was
           done in breach of the law. If a meeting is held in breach of  an
           injunction, it cannot be said that  the  meeting  has  not  been
           held. But the legal consequences of what has been done in breach
           of the law may plainly be very much affected by the  illegality.
           It seems to me on principle that those who  defy  a  prohibition
           ought not to be able to claim that the fruits of their  defiance
           are good, and not tainted by the illegality that produced them.”


              19. To the same effect are the decisions of  the  Madras  and
           Calcutta High Courts in Century Flour Mills Ltd. v.  S.  Suppiah
           (AIR 1975 Mad270) and Sujit Pal v. Prabir Kumar  Sun  (AIR  1986
           Cal 220). In Century Flour Mills Ltd.(supra) it was  held  by  a
           Full Bench of the Madras High Court that where an act is done in
           violation of an order of stay or injunction, it is the  duty  of
           the court, as a policy, to set the wrong right and not allow the
           perpetuation of the wrongdoing. The inherent power of the court,
           it was held, is not only available in such a  case,  but  it  is
           bound to exercise it to  undo  the  wrong  in  the  interest  of
           justice. That was a case where a meeting was held contrary to an
           order of injunction. The Court refused  to  recognise  that  the
           holding of the meeting is a legal one. It put back  the  parties
           in the same position as they  stood  immediately  prior  to  the
           service of the interim order.


              20. In Sujit Pal(supra) a Division Bench of the Calcutta High
           Court has taken the same view.  There,  the  defendant  forcibly
           dispossessed  the  plaintiff  in  violation  of  the  order   of
           injunction and  took  possession  of  the  property.  The  Court
           directed the restoration of possession to the plaintiff with the
           aid of police. The  Court  observed  that  no  technicality  can
           prevent the court from doing justice in exercise of its inherent
           powers. It held that the object of Rule 2-A of Order 39 will  be
           fulfilled only where  such  mandatory  direction  is  given  for
           restoration of possession  to  the  aggrieved  party.  This  was
           necessary, it observed, to prevent the abuse of process of law.


              21. There is no doubt that  this  salutary  rule  has  to  be
           applied and given effect to by  this  Court,  if  necessary,  by
           overruling any procedural or other technical objections. Article
           129 is a constitutional power and when exercised in tandem  with
           Article 142, all such objections should give way. The court must
           ensure full justice between the parties before it.”




      25.   In the present case the Company and its Directors/servants  were
      certainly guilty of transgressing or violating the Order of 08.05.2014
      but as found hereinabove, the transferee  and  its  Directors/servants
      have not violated the Order of 08.05.2014.   The  transferee  and  its
      Directors/servants were neither parties to the  proceedings  nor  were
      they served with the Order of 08.05.2014.  In para 38 of the  judgment
      of this Court dated 13.11.2014, this Court had found the  transfer  in
      favour of the transferee to be  questionable  and  had  relegated  the
      matter to the BIFR to consider the matter in the light  of  directions
      contained in said para 38.  In the circumstances,  no  further  orders
      are  called  for  invalidating  the  registration  dated   02.07.2014.
      Further, according to the record the transferee had parted  with  full
      consideration way back  on  04.04.2013.   In  the  totality  of  these
      circumstances we do not think it appropriate to exercise our power  to
      invalidate the effect of registration of the document on 02.07.2014.


      26.   We thus find  the  Company  and  its  Directors/servants  namely
      alleged Contemnor Nos.1, 4, 5, 6, 7 and 8 guilty  of  having  violated
      the Order of 08.05.2014.  In our view, ends of justice would be met if
      fine is imposed on the Contemnors.  We impose fine  of  Rs.2,000/-  on
      the Company.  Further, fine of Rs.2,000/- each is imposed on Contemnor
      Nos.4, 5, 6, 7 and 8.  Fine shall be deposited with  the  Registry  of
      this Court within four weeks  from  today.   In  case  of  failure  by
      Contemnor Nos.4, 5, 6, 7 and 8 to deposit the amount  of  fine  within
      the  time  stipulated,  they  shall   undergo   sentence   of   simple
      imprisonment for one month.
      27.   With these observations, we close  Contempt Petition Nos.338  of
      2014 and 375 of 2014 and the same stand disposed of.
      28.   In Contempt Petition Nos.24-25 of 2015 it is submitted that  the
      contemnors have obstructed the implementation of  the  judgment  dated
      13.11.2014 passed by this Court.  The acts alleged are in  the  nature
      of legal proceedings initiated by the contemnors and as such we do not
      find any reason to invoke our contempt  jurisdiction.   Said  Contempt
      Petition Nos.24-25 of 2015 thus stand dismissed.
      29.   In Contempt Petition No.307 of  2015  it  is  alleged  that  the
      direction issued by this Court in  paragraph  No.33  of  its  Judgment
      dated 13.11.2014 has not been complied with by the contemnors.   Since
      no notice  as  regards  this  Contempt  Petition  was  issued  to  the
      contemnors we issue notice to the contemnors returnable in six  weeks.
      The matter shall be placed before the appropriate Bench.


                                                               ………………………….J.
                                                    (Anil R. Dave)






                                                     ..……………………….J.
                                                     (Uday Umesh Lalit)


New Delhi,
November 18, 2016





-----------------------
      [1] (2015) 1 SCC 298
      [2] 2012 1 SCC 656
      [3] (1996) 4 SCC 622

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