2007 Supreme(SC) 331

2007(2) Supreme 936
SUPREME COURT OF INDIA
(From Calcutta High Court)
Dr. AR. Lakshmanan and Altamas Kabir, JJ.
All Bengal Excise Licensees Association—Appellant
versus
Raghabendra Singh & Ors.—Respondents
Civil Appeal No. 1246 of 2007
(Arising out of SLP (C) No. 15224 of 2006)
Decided on 9-3-2007
Counsel for the Parties :
For the Appellant : K.K. Venugopal, Pradip Ghosh, Joydip Gupta, Sr. Advocates, Deep Narayan Mukherjee and Chanchal Kumar Ganguli, Advocates.
For the Respondents : Gopal Subramaniam, A.S.G., Bhaskar P. Gupta, P.N. Misra, M.N. Krishnamani, Sr. Advocates, J. Kar, Rana Mukherjee, Siddharth Gautam, Goodwill Indeevar, Aman Vachher, Ashutosh Dubey, Krishnandu Sarkar, P.N. Puri, K.V. Vishwanathan, Abhijit Sengupta, Azim H. Laskar, Ms. Indrani and Anand, Advocates.

IMPORTANT POINTS
1. Under the constitutional scheme of this country orders of the High Court have to be obeyed implicitly and that orders of the Supreme Court – for that matter any Court should not be trifled with.
2. Where in violation of a restraint order or an injunction order against a party, something has been done in disobedience, it will be the duty of the Court as a policy to set the wrong right and not allow the perpetuation of the wrong doing.
3. It is settled law that a party to the litigation cannot be allowed to take an unfair advantage by committing breach of an interim order and escape the consequences thereof by pleading misunderstanding and thereafter retain the said advantage gained in breach of the order of the Court. Such violations should be put an end with an iron hand.

Headnote:(i) Bengal Excise Act, 1909—Grant of excise licenses—Policy decisions for issuance of excise licenses for opening of new foreign liquor shop and country spirit shops—Writ petitions filed by Excise Licensees including the country spirit shop owners alleging violation of provisions of the Act—Interim order passed by High Court directing that authorities will process the matter but will not finalise and issue the new licence without leave of the court—Interim order dated 4-1-2005 which has been extended from time to time and is still continuing, respondent authorities in disregard caused publication of advertisement of newspapers for holding lottery for final selection of excise shops—Contempt petition—Plea of mistake of understanding the interim order—High Court held that failure to understand the implications and/or consequences of the order passed by the Court cannot be construed as an act of contempt—Whether High Court was justified in dismissing the contempt petition—(No)—High Court should have directed the contemnors to undo the wrong committed by them by cancelling the lottery wrongfully held by them—Contempt of Courts Act, 1971.

       Held : It is not in dispute that an injunction order was passed on 04.01.2005 and on subsequent extension is still subsisting. Respondent Nos.1-4 admittedly are highly qualified and highly placed government officials. Admittedly, by advocate’s letter dated 15.03.2005, it was pointed out to them that the injunction order dated 04.01.2005 and its subsequent extensions are still subsisting. They have also acknowledged the receipt of the communication dated 15.03.2005. Under such circumstances, the High Court is not justified in holding that the highly qualified and well placed government officials did not understand the implication and/or consequence of prohibitory order in an independent proceedings and by sheer mis-conception thought that there is no bar to issue excise licenses as was held by the learned Judge in the impugned order. This Court can only say it is rather unfortunate that such officers who are not capable of or not able to understand the implication of the prohibitory orders passed by the High Court should be allowed to hold such high offices. During the course of the hearing of the contempt application, the matter was adjourned by the High Court to enable the respondent to consider whether the contemnors was prepared to cancel the lottery held on 20, 21 and 22.03.2005 in violation of the Court’s orders and on such adjourned date, the contemnors did not agree to cancel the lottery. Under such circumstances, the plea of mistake of understanding the order cannot at all be accepted. Likewise, the High Court also was not justified in not directing the contemnors to cancel the lottery held on 20, 21 and 22.03.2005 in violation of the solemn orders passed by the very same Judge and in view of the clear finding of the Court that they had acted in clear violation of the said interim order made by the High Court. (Para 23)

       In our opinion, a party to the litigation cannot be allowed to take an unfair advantage by committing breach of an interim order and escape the consequences thereof. By pleading misunderstanding and thereafter retaining the said advantage gained in breach of the order of the Court and the wrong perpetrated by the respondent-contemnors in contumacious disregard of the order of the High Court should not be permitted to hold good. In our opinion, the impugned order passed by the High court is not sustainable in law and should not be allowed to operate as a precedent and the wrong perpetrated by the respondent-contemnors in utter disregard of the order of the High Court should not be permitted to hold good. The High Court has committed a grievous error of law in holding that failure to understand the implication and consequences of the order passed by the High Court by highly placed government officers cannot be construed as an act of contempt. The High Court has failed to understand that the highly educated and highly placed government officials have competent legal advisors and it was not open to them to allege and contend that the respondent-contemnors did not understand the implication of the order dated 04.01.2005. In our opinion, such officers are required to be dealt with effectively to uphold the dignity of the High Court and the efficiency of the system itself. The High Court committed a grave error of law by not taking into consideration the most important fact that in the course of the hearing of the contempt application the matter was adjourned in order to enable the contemnor to consider whether they were prepared to cancel the lottery held on 20, 21 and 22.03.2005 and on the adjourned date, the respondents did not agree to cancel the lottery. In such view of the matter, the significant stand being the plea of mistake of understanding cannot, in our opinion, prevail. The High Court in that view of the matter committed a grave mis-carriage of justice by not taking into consideration another most important fact that if actually the lottery was held by mistake or by misunderstanding of the orders, then the respondent would have immediately rectified it and would have cancelled the lottery but in the instant case, instead of canceling the lottery, the respondents have justified their conduct from which the determined declination of obeying the order is clearly proved. In other words, if there was a doubt about the implication of the order of the Court, the respondents should have approached the Court and should have clarified their alleged confusion. But in the instant case, the respondents have not only violated the order but when the contempt application was moved and opportunity was given by the Court to cancel the lottery they refused to cancel the said lottery from which it is proved that they deliberately held the lottery in clear violation of the order dated 04.01.2005 having regard to the admissions made on behalf of the contemnors that there is violation of the order dated 04.01.2005 and also having regard to the learned Single Judge’s own finding that “there is no doubt that the alleged contemnor disobeyed the specific directions passed earlier by this Bench”. The High Court should have directed the contemnor to cancel the lottery held on these 3 dates. (Para 25)

       As it is evident that respondent Nos.1-4 have no regard for the orders passed by this Court on 4, 19 and 20.01.2005 and have scant respect for the Court’s orders and have deliberately and willfully and with utter disregard violated all the 3 orders and are thus guilty of contempt of Court. However, taking a lenient view and taking into consideration of the future prospects of the officers, respondent Nos. 1-4 we are not imposing any punishment for their willful violation of the order of the High Court and accept the unqualified apology filed before the High Court. Respondent Nos. 1-4 are severely warned that they shall not involve themselves or violate the order passed by any Court of law and will not resort to the unacceptable plea that the said highly placed and highly qualified government officials did not understand the implication and/or consequences of a prohibitory order passed by the Courts of law. They shall not hereafter also take the plea of inventing an innovative defence that they did not realise the implications of the order passed by the High Court which remained operative at the relevant time. (Para 27)

       (ii) Contempt of Court Act, 1971—Sections 2 and 12—Violation of interim order of injunction passed by High Court—Unconditional apology by contemners, Government officials—Not a complete answer to violations and infractions of orders of the High Court or of the Supreme Court—Contemners are senior and experienced Government Officers—They are severely warned that they shall not involve themselves or violate the order passed by any Court of law—It is held that the contemners will not resort to the unacceptable plea that the said highly placed and highly qualified government officials did not understand the implication and/or consequences of a prohibitory order passed by the Court of law—Bengal Excise Act, 1909.

       Held : All the respondent Nos. 1-4 are senior and experienced officers and must be presumed to know that under the constitutional scheme of this country orders of the High Court have to be obeyed implicitly and that orders of this Court – for that matter any Court should not be trifled with. We have already found hereinabove that they have acted deliberately to subvert the orders of the High Court evidently. It is equally necessary to erase an impression which appears to be gaining ground that the mantra of unconditional apology is a complete answer to violations and infractions of the orders of the High Court or of this Court. We, therefore hold them guilty of contempt of Court and do hereby censure their conduct. (Para 28)

       (iii) Civil Procedure Code, 1908—Section 151—Inherent Powers—Violation of a restraint order or an injunction order against a party—Something has been done in disobedience—Duty of Court as a policy to set the wrong right and not allow the perpetuation of the wrong doing—Inherent power is bound to be exercised in that manner in the interest of justice and public interest—As a matter of judicial policy the Court should guard against itself being stultified in circumstances by holding that it is powerless to undo a wrong done in disobedience of Courts order.

       Held : In the instant case, the respondents have conducted the auction quite contrary to and in violation of an injunction order passed by the High Court. Courts have held in a catena of decisions that where in violation of a restraint order or an injunction order against a party, something has been done in disobedience, it will be the duty of the Court as a policy to set the wrong right and not allow the perpetuation of the wrong doing. In our opinion, the inherent power will not only be available under Section 151 CPC as available to us in such a case but it is bound to be exercised in that manner in the interest of justice and public interest. As rightly observed by the Full Bench of the Madras High Court in AIR 1975 Madras 270, that as a matter of judicial policy the Court should guard against itself being stultified in circumstances like this by holding that it is powerless to undo a wrong done in disobedience of the Court’s orders.(Para 28)