Contempt proceedings were not the correct remedy for the appellants' actions, and the court clarified that the remedy for enforcing the decree was through execution proceedings.

ORDER

1. This appeal is against the order dated 21-7-1997 by which the appellants have been held guilty of contempt and sentenced to two years' imprisonment and fine equal to the amount of loan remaining unpaid i.e.Rs 28,38,367.48. In default in payment of fine a further imprisonment of two years has been imposed.

2. Briefly stated the facts are as follows:

Appellant 1 had got sanctioned a loan in his favour from the respondent Bank. Appellant 2 stood surety for the loan. The 1st appellant borrowed amounts in pursuance of the loan facility. The 1st appellant committed defaults in repayment. Therefore, the respondent Bank seized the premises of the 1st appellant on 4-12-1995. A public notice for sale of the assets was 9 issued on 9-12-1995. The 1st appellant filed a writ petition challenging the action of seizure and sale. That writ petition was dismissed on 20-12-1995.

The LPA against that order was also dismissed on 22-1-1996. But while dismissing the LPA the following directions inter alia came to be issued:

"As we have indicated earlier, we would not have interfered in the instant proceeding but for the information that the Branch Manager concerned of the Bank has allegedly allowed his wife to have business with the clients of the Bank and as alleged, prevailed upon the appellant herein to part with a sum of money with his wife not from the account in the Bank but from some other source. We have, however, taken notice of the interest of the Bank and it seems inappropriate to permit the appellant to continue its business with the Bank in question. We have accordingly sought a statement at the Bar on behalf of the appellant that it shall liquidate all the debts of the Bank in instalments within a specified period of time. Learned counsel for the appellants has stated that the appellant shall clear the debt within a period of one-and-a-half years in four equal instalments beginning from the month of April 1996.

We have good reasons to accept the above offer and accordingly order that the appellant shall pay the first instalment in April 1996, the second instalment within five months of the payment of the first instalment, the third within five months of the payment of the second instalment and the fourth within five months of the payment of the third instalment and clear accordingly all the dues of the Bank. The appellant shall have no further transaction with the Bank in the current account concerned, which again shall be closed finally on the payment of the last instalment."

3. The 1st appellant filed a special leave petition against this order which came to be dismissed on 8-5-1996.

4. The respondent then filed a contempt petition alleging breach of the above directions. The High Court, in the impugned judgment, has taken note of the fact that, having got the instalments from the Court the 1st appellant in connivance with the 2nd appellant and other relatives has disposed of almost all the available assets. The High Court has then proceeded to hold as follows:

"The above discloses not only an act of wilful disobedience of the undertaking but also serious offences of criminal breach of 'trust and cheating the Bank of public money and, circumstances as above, do indicate involvement of the then Branch Manager of the Bank. It is a fit case, in our opinion, thus to hold the contemnors guilty for wilful disobedience of the undertaking aforementioned and thus liable for punishment of contempt of Court. We also find sufficient materials in the above report of the Deputy Commissioner of Police, Detective Department II, Hyderabad City for lodgment of a criminal case with CID against the abovenamed two contemnors and others who are involved in the act of cheating and criminal breach of trust and other offences."

5. The High Court then sentenced both the appellants as stated above.

The High Court also directed the Inspector General of Police, CID to register a case on the basis of the report of the Deputy Commissioner of Police dated 19-7-199