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2011 Supreme(Mad) 225
High Court of Judicature at Madras
M. CHOCKALINGAM
N. Srinivas & Another
Versus
Naresh Kumar & Others
CONTEMPT PETITION No.114 of 2008
Decided on : 18-01-2011
For the Petitioners:T.V. Ramanujan, Senior Counsel for T.V. Krishnamachari, Advocate.
For the Respondents:R1 to R5 - D. Dharamchand Jain, R6 - K. Harishankar, Advocates.
Willful and deliberate disobedience of court orders constitutes contempt and may lead to the imposition of exemplary costs.
Headnote:
Contempt - Violation of Court Orders - C.S.No.979 of 2004 - O.A.No.243/2006 - [Article 129 of the Constitution, Section 94 of the Code of Civil Procedure, 1908, Rule 2-A of Order 39, (2009) 4 SCC 213, (2003) 11 SCC 1, (1999) 7 SCC 569, 1974 AC 273, (2002) 4 SCC 21, (2007) 11 SCC 374] - The respondents violated the court's order by executing a mortgage deed in defiance of the status-quo order, leading to willful and deliberate disobedience. The court imposed exemplary costs on the respondents.
Fact of the Case:
The petitioners sought action against the respondents for contempt, as the respondents violated the court's orders by executing a mortgage deed in defiance of the status-quo order.
Finding of the Court:
The court found that the respondents' actions constituted willful and deliberate disobedience of the court's orders, leading to the imposition of exemplary costs on the respondents.
Issues: Violation of Court Orders, Willful Disobedience, Contempt Proceedings
Ratio Decidendi: The respondents' execution of the mortgage deed in defiance of the status-quo order constituted willful and deliberate disobedience, leading to the imposition of exemplary costs.
Final Decision: Exemplary costs of Rs.1,00,000/- were imposed on each of the respondents, and any third-party right created after the status-quo order was set aside. The contempt petition was disposed of.
1. This petition has been brought forth by the petitioners seeking action against the respondents 1 to 5 herein for an act of contempt committed by them by disobeying the orders of this Court made in O.A.No.243 of 2006 in C.S.No.979/2004 dated 23.3.2006.
2. The case of the petitioners is as follows:
The petitioners along with others have filed a suit for declaration and permanent injunction before this Court in C.S.No.979 of 2004. While doing so, they have filed an application in O.A.No.1013/2004 for injunction, and this Court granted an order of injunction restraining the respondent from interfering with their peaceful possession and enjoyment of the suit property on 23.12.2004. The said injunction is still in force. The fifth defendant filed a counter. While the matter stood thus, in the year 2006, the fifth respondent made attempts to alienate the suit property. Thereafter, the petitioners have filed an application in O.A.No.243/2006 for injunction, and this Court has ordered status-quo to be maintained on 23.3.2006. Now, the suit is ripe for trial. The petitioners have applied for encumbrance certificate and got the same on 6.12.2006, from which they came to know that the fifth respondent has mortgaged the suit property by way of deposit of title deeds for a sum of Rs.6,25,00,000/- in favour of the sixth respondent bank herein. Thus the act of the fifth respondent is in gross violation and willful disobedience of the orders of status-quo made by this Court. The respondents 1 to 4 are the Directors of the fifth respondent company. The fifth respondent has no right to mortgage the property when the order of status-quo is in force. Hence the respondents 1 to 5 are liable to be punished.
3. The respondents 1 to 5 have filed a counter affidavit stating that the petitioners filed O.A.Nos.1013/2004 and 243/2006 for interim injunction; that the respondents have filed a counter; that at the time of arguments, both sides claimed that they are in possession of the suit property; that accordingly, the Court ordered status-quo to be maintained till the disposal of the suit; that they thought that the status-quo order is only with respect to the possession of the suit property; that in the counter affidavit filed in O.A.No.243/2006, and the written statement filed, the fifth respondent had submitted about the loan availed from City Bank; that the charge was registered in the Company Law Board; that this was not questioned by the petitioners; that they knew about it; that subsequently, the loan was transferred from City Bank and loan was obtained from the sixth respondent bank; that a charge was registered in the Company Law Board in that regard; that there is no prohibition for the fifth respondent to have the loan transferred and for execution and registration of agreement by deposit of title deeds dated 6.12.2006, in favour of the sixth respondent; that the said agreement was executed by the second respondent herein as Director of the fifth respondent; that they have not violated the order as the mortgage existed even before the loan was changed to and in favour of another bank; that as owner of the property, the fifth respondent is entitled to deal with the same as the status-quo order is only in regard to possession; that however, they seek unconditional apology for the omission if any done by them, and hence the petition was to be dismissed.
4. In the counter affidavit filed by the sixth respondent, it is stated that they were never made aware of the Court's order; that they have taken legal opinion from their panel advocate and thereafter only, the mortgage was made; that the respondents 1 to 5 have borrowed crores of rupees from the sixth respondent bank and have failed to repay the same; that the bank has already initiated proceedings in O.A.No.16 of 2008 before the Debts Recovery Tribunal at Chennai for recovering their dues; that the same is pending; that the sixth respondent has not committed any act of contempt, and
