SCINDIA POTTERIES & SERVICS PVT LTD  Vs ANKUR JAIN & ORS -Judgment by Delhi High Court

$~92
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CONT.CAS(C) 661/2019 & CM APPL. 33657/2019
SCINDIA POTTERIES & SERVICS PVT LTD …..Petitioner
Through: Mr. Manav Gupta, Mr. Sahil Garg, Ms. Devanshi Rangi and Ms. Anushka, Advocates
versus
ANKUR JAIN & ORS ….. Respondents
Through: Mr. Viraj Datar, Sr. Advocate Ms. Sonal Sarda, Advocate with Mr. Ankur Jain Respondent.
Reserved on: 09.01.2023 % Date of Decision: 31.01.2023
CORAM:
HON’BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA JUDGMENT
MANMEET PRITAM SINGH ARORA, J:
1.
By the order dated 02.03.2020 of this Court, the Respondent no.1, Mr. Ankur Jain, has been held guilty of contempt for willful breach of the undertakings given by him on 18.07.2018 and 01.08.2018 to this Court in RFA No. 857/2017.

2.
The Respondent no.1, contemnor was served with a notice for his personal appearance before the Court for awarding punishment.

3.
Learned counsel for the Petitioner states that Respondent no.1, is the legal heir of the original defendant Dr. J.K. Jain in CS(OS) No. 1311/2001. He states that Dr. J.K. Jain was made a Director of the Petitioner company in 1980 and he was provided the property at Scindia

Villa, Scindia Potteries Compound, Sarojini Nagar, New Delhi (�the suit premises�) for his residence.
3.1 He states that facts evidencing the wilful breach of the undertakings by Respondent no. 1 has been set out in the order dated 02.03.2020 passed by this Court. He states that even after his conviction, the Respondent no.1 had exhibited complete disregard for the legal process and has obstructed the recovery of possession of the suit premises.
3.2 He states that Respondent no. 1 acted to the prejudice of the Petitioner and with a view to obstruct the execution of the judgment and decree dated 17.07.2017, wrote a letter dated 15.02.2019 to the Interim Resolution Professional (�IRP�) M/S Noida Software Technology Private Ltd.(�NSTPL�) provoking him to take the possession of the suit premises so as to frustrate the warrants of possession issued by the executing court on 01.02.2019. The IRP in Dena Bank v. NSTPL, acted upon the letter of the Respondent no. 1 and took possession of the suit premises from Respondent no. 1 and his family on 16.02.2019.
3.3 He states that the Petitioner herein was thus, compelled to approach the National Company Law Tribunal (�NCLT�) for seeking possession of the suit premises from the IRP. He states that the NCLT vide order dated 18.07.2022 held that the suit premises do not belong to NSTPL and directed Resolutional Professional (�RP�) to hand over the possession of the suit premises to the Petitioner. He states that the Respondent no. 1 opposed the Petitioner�s plea for handover of possession of the suit premises before the NCLT in the aforesaid proceedings.
3.4 He further referred to the objections filed by a company, Dr. Jain Clinic Pvt. Ltd. before the executing court objecting to the issuance of warrants of possession. He states that the said objections were filed at the instance of Respondent no.1�s mother Mrs. Ragini Jain. He relies upon a resolution dated 19.10.2019 signed by Mrs. Ragini Jain in this regard.
3.5 He states that though the conditional interim stay was vacated in 2018 and in the due course the Petitioner should have received the possession in 2018 in compliance with the judgement and decree dated 17.07.2017, however as is evident from the record, the Petitioner was able to recover possession of the suit premises on 22.07.2022, after multiple legal proceedings. The suit premises was handed over to the Petitioner by the RP in the matter of insolvency of Jain Studios Pvt. Ltd. by way of a handover letter on 22.07.2022.
3.6 He states that the suit for possession was instituted on 01.06.2001 and decreed on 17.07.2017. The possession was recovered in 2022. He states that these glaring facts evidence that the Respondent no.1 and his family members abused the legal process to deny the Petitioner, the owner of the suit premises, its right of possession.
3.7
He states that the obstruction in recovery of possession of the suit premises by Respondent no.1 evidences his disregard for the judicial process and interference in the administration of justice and therefore prays that maximum punishment should be awarded to the Respondent no. 1.

4.
In reply, learned senior counsel for Respondent no.1 states that Respondent no.1 has filed an affidavit dated 01.12.2022 to set out facts

which enlist the circumstances which led to his inability to comply with the undertakings dated 18.07.2018 and 01.08.2018 given to this Court.
4.1 He states that the suit premises are not the residence of Respondent no.1. He states that the suit premises were the registered office of Jain Studios Ltd., which was original defendant no. 2 in the civil suit of possession filed by the Petitioner in 2001.
4.2 He states that the bona fide of Respondent no. 1 is evident from the fact that after giving the undertakings on 18.07.2018 and 01.08.2018, a sum of Rs. 22,50,000/-was paid towards the mesne profits on 22.11.2018. He states that a total payment of Rs. 1,05,00,000 was made towards the judgment and decree dated 11.10.2017.
4.3 He states that Respondent no. 1 reasonably believed that he would be in a financial position to comply with the undertakings and make payments. He states that, however, Respondent no.1 was not aware about the precarious financial position of the companies of late Dr. J.K. Jain and he was therefore unable to meet the said liability despite his best efforts, which led to non-compliance.
4.4 He states that as on date, Respondent no.1 is facing personal bankruptcy proceedings initiated by his creditors.
4.5 He states that Respondent no.1 herein has not filed any objections in the executing court opposing the issuance of warrants of possession. He states that he is neither a shareholder nor a director in Dr. Jain Clinic Pvt. Ltd., the company which filed the objections before the executing court.
4.6
He therefore prays that this Court may bear the aforesaid facts while awarding the punishment to Respondent no.1.

5.
This Court has heard the learned counsel for the parties and perused the paper book. The admitted facts which led this Court to hold the Respondent no.1 guilty of contempt are as under:

i. The Petitioner herein filed CS(OS) No. 1311 of 2001 against Dr.
J.K Jain and Jain Studios Ltd. (�original defendants�) for
mandatory injunction, permanent injunction, recovery of physical
and vacant possession of the suit premises and mesne profit.
ii. A decree and judgment dated 17.07.2017 was passed in the said
suit granting the following reliefs to the Petitioner:
a. passing a decree of possession as well as mandatory
injunction in favour of the Petitioner.
b. The original defendants in the suit were directed to hand over
peaceful and vacant possession of the suit premises.
c. A decree of permanent injunction was also passed in favour
of the Petitioner, restraining the original defendants from
carrying out any commercial activities in the suit premises.
d. A decree of mesne profit at the rate of Rs. 5 lakhs per month
along with 9% and Rs. 7.5 lakhs per month post the decree till
actual vacation of the suit premises by the original defendants
to the Petitioner payable along with interest at 9% per annum.
iii. First Appeal being RFA No. 857/2017 was filed by the original
defendants before this Court challenging the judgment and decree
dated 17.07.2017.
iv. In the application filed under Order 41 Rule 5 of Code of Civil
Procedure, 1908, in the said appeal a conditional stay was granted
vide order dated 23.11.2017. The appellate court directed the

original defendants to deposit 50% of the decretal amount with up-to-date interest within 8 weeks, i.e., 18.01.2018, and subject to the further condition of depositing the monthly use and occupation charges at the rate of Rs. 7.5 lakhs per month, till the disposal of the appeal.
v. The original defendants failed to deposit the money in terms of the said order dated 23.11.2017 and therefore the decree and judgment dated 17.07.2017 became executable.
vi. Accordingly, on 01.02.2018, the Petitioner herein filed an execution petition before the trial court.
vii. To avoid the execution, the original defendants filed an application bearing CM No. 4177/2018 in the said appeal seeking extension of time to comply with the order dated 23.11.2017.
viii. The appellate court relying upon the averments made in the said application, extended the time vide order dated 05.02.2018 on the conditions recorded therein.
ix.
The original defendant, Dr. J.K Jain expired on 05.03.2018.

x.
Respondent no.1 herein impleaded himself in the aforesaid appeal as the legal heir of Dr. J.K Jain and the authorized representative of Jain Studio Limited, the other original defendant.

xi. Respondent no.1 on 18.07.2018 sought continuation of the stay order dated 23.11.2017 by undertaking to comply with the obligation of deposit of 50% of the decretal amount and payment of current mesne profits. The appellate court accepted the undertaking (1st undertaking) of the Respondent no.1, extended the time to deposit the decretal amount and cautioned the said Respondent with respect to the consequences with the breach of the undertaking given to the Court. In the aforesaid terms, CM Application 4177/2018 was disposed of vide order dated 18.07.2018. In the said order, significantly it was noted by the appellate court that, if the Respondent no.1 contemnor fails to comply with the undertaking, the decree shall be executable. The relevant portion of order dated 18.07.2018 reads as follows:
�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.�
(Emphasis supplied)
xii. In view of the said extension of stay, Respondent no.1 continued to enjoy possession of the suit premises.
xiii. Respondent no.1 was unable to comply with the undertaking given by him on 18.07.2018 and therefore filed another application being CM Appl. 30665/2018 seeking a modification of the order dated 18.07.2018. Respondent no.1 sought further extension of time to deposit 50% of the decretal amount.
xiv. The appellate court in CM Appl. No. 30665/2018 vide order dated 01.08.2018 granted a further extension to deposit the decretal amount on a fresh undertaking (2nd undertaking) given by Respondent no.1 with caution that if he fails to comply with the undertaking, consequences shall follow. The relevant portion of the order dated 01.08.2018 reads as under:
�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.�
xv. (Emphasis supplied) Respondent no.1 was unable to comply with the 2nd undertaking
given on 01.08.2018 and therefore moved CM No. 47168/2018,
yet again seeking extension of time. The appellate court vide order
dated 14.12.2018 declined to extend the time.
xvi. Consequently, since there was no stay on the operation of the
judgment and decree dated 17.07.2017, the said decree became
executable as directed by the appellate court in its order
18.07.2018. The Respondent no. 1 and the other appellants were
liable to handover the vacant and peaceful possession of the suit
premises to the Petitioner immediately thereafter on 14.12.2018.
xvii. However, Respondent no.1, his mother and sister who were acting
on behalf of all the appellants i.e., original defendant willfully
failed to hand over the vacant and peaceful possession of the suit
premises to the Petitioner.
xviii. Instead, it has come on record that the Petitioner herein was able
to recover the possession of the suit premises only after four long
years on 22.07.2022; and after several legal battles in these four
years.
6. The Petitioner has set out in detail in its affidavit dated

15.10.2022 the details of the multiple legal proceedings it had to prosecute and defend in order to secure the possession of the suit premises. The affidavit sets out in detail the list of proceedings initiated by companies owned and controlled by Respondent no.1 and his family members, wherein the possession of the premises was unjustly embroiled so as to obstruct the compliance of the said judgment and
decree. The relevant portion of the affidavit reads as under:
�11. I state that thereafter the Execution Proceedings were stayed on account of an Application dated 19th February 2019 moved by the IRP appointed by the Ld. NCLT in CP No. 1344 of 2018 titled �Deena Bank vs. Noida Software Technology Park Ltd.
12.
In relation thereto that the CIRP against Noida Software Technology Park Ltd was fraudulently initiated which is abundantly clear from the fact that vide resolution dated 30th January, 2019 passed by M/s Noida Software Technology Park Ltd, it was resolved that the said Company would not oppose the appointment of Interim Resolution Professional. The said resolution was signed by Mr. Ankur Jain as the Managing Director of M/s Noida Software Technology Park Ltd.

13.
I state that deliberate attempt being made by the Contemnor is apparent from the fact that Contemnor Mr. Ankur Jain himself vide letter dated 15th February 2019 addressed to the Resolution Professional informed him regarding the pendency of the Execution proceedings and regarding order dated 1st February 2019 passed by the Execution Court.

14.
Further, during the pendency of the aforesaid execution petition, insolvency proceedings were initiated against Jain Studio Limited and a moratorium was ordered vide Order dated 26th February 2020 passed by Hon’ble NCLT, Special Bench, New Delhi in C.P. No. (IB)�244(PB)/2019 titled as “Stressed Assets Stabilization Funds (SAFS) vs. Mis Jain Studio Limited”.

15.
That in view of the aforesaid Order and upon an Application filed by the Resolution Professional of Jain Studios Limited, the Hon’ble Execution Court vide Order dated 20th March 2021 stayed the execution proceedings, holding as under: xxx xxx xxx

16.
That pursuant thereto, the Petitioner herein was constrained to prefer an application being IA No. 2437 of 2021 titled “Scindia Potteries and Services Pvt. Ltd. Vs. Mr. Manish Agarwal” before the Hon’ble NCLT, Principal Bench, New Delhi in C.P. No. (IB)�244(PB)/2019 inter-alia seeking the following prayers:

a)
Direct the Resolution Professional to furnish a copy of the complete Resolution Plan to the Applicant as well as a copy of the application filed seeking approval of the Resolution Plan;

b)
Direct the Resolution Professional to hand over the vacant physical possession of the premises (situated at Scindia Villa, Sarojini Nagar, Ring Road, New Delhi 110023 possession of which were taken by him pursuant to being appointed the Interim Resolution Professional) to the

Applicant or in the alternate to the Hon’ble Court of Sh. Munish Markan, A.D.J., Patiala House Courts, New Delhi where the proceedings being Ex. No. 80 of 2018 titled Scindia Potteries & Services Private Limited Vs. Dr. J.K. Jain & Anr. Is pending, forthwith and in any event the moment the moratorium ceases io have effect;�
(Emphasis supplied)
7.
The Predecessor Bench of this Court on 02.03.2020 refrained from proceeding in contempt against Mrs. Ragini Jain and Ms. Madhurika Jain giving them benefit of doubt. However, a perusal of the list of proceedings initiated by the family members of the Respondent no.1 including the objections filed by Dr. Jain Clinic Pvt. Ltd. to obstruct the recovery of possession, mocks at the leniency shown by this Court to Respondent no.1�s aged mother and the sister. It appears to this Court that the Respondents mistook the compassion shown by the Court as lack of its conviction to punish the Respondent no. 1 for his deliberate and wilful breach and disobedience.

8.
After the judgment was reserved on 09.01.2023, an affidavit has been filed by Respondent no.1 on 12.01.2023, wherein the Respondent no.1 has criticized the RP of Jain Studio Limited for the order dated 18.07.2022 by the NCLT, which finally led to the Petitioner herein recovering the possession. The averments in the said affidavit belie any contrition on Respondent no.1�s behalf for the breach of undertakings. The relevant part of the affidavit reads as under:

�7. Additionally, in this context, I�d also like to state the following:
a.
With respect to the suit property, when the Claimant approached the Ld. NCLT, it directed the Petitioner herein to approach the CoC of NSTPL and make a representation to them. The CoC of NSTPL voted against giving them the said property.

b.
Additionally, even the IRP, and then the RP, of Jain Studios Limited (�JSL�) had possession of the suit property.

c.
It was the RP of JSL which stated that the suit property was not in its book of account. This was clearly a mistake since the assets of JSL were on the suit property, which the RP was supposed to safeguard. He neglected the fact that JSL had made investments on this land which is why he had the property.�

(Emphasis supplied)
9.
This Court finds force in the submission of the learned counsel for the Petitioner that the letter dated 15.02.2019 written by Respondent no.1 to the IRP was misleading and issued deliberately with the intent to obstruct the compliance of the execution of warrants dated 01.02.2019.

10.
The suit was instituted on 01.06.2001 and it was decreed on 17.07.2017. The appellate court vacated the stay on 14.12.2018 and the decree was executable. However, the Petitioner recovered the possession on 22.07.2022. The facts of this case are glaring inasmuch as the Petitioner who followed the due process of law to recover possession was confronted with an opponent who abused the process of law to defeat the claims of the Petitioner.

11.
The Petitioner was subjected to multiple legal proceedings in different forums by Respondent no. 1 and his family after 14.12.2018, which evidences that the Respondent no. 1 has scant regard for the undertakings given to the appellate court and the orders of the said court. In a civil society which favours the rule of law, no person can be allowed to elect to not comply with the orders of the Court. In this regard, this Court would like to refer to the decision of the Supreme

Court in Subrata Roy Sahara v. Union of India and Others, (2014) 8
SCC 470, wherein it was held as follows:
�185.2. Disobedience of orders of a court strikes at the very root of the rule of law on which the judicial system rests. Judicial orders are bound to be obeyed at all costs. Howsoever grave the effect may be, is no answer for non-compliance with a judicial order. Judicial orders cannot be permitted to be circumvented. In exercise of the contempt jurisdiction, courts have the power to enforce compliance with judicial orders and also, the power to punish for contempt. (For details, refer to paras 15-21)
(Emphasis supplied)
12. Even though in the affidavit dated 01.12.2022 filed by the
Respondent no.1 contemnor had tendered apology to this Court for the
non-compliance of the undertakings given to this Court, this Court does
not find any sincerity in the said apology on behalf of Respondent no.1
contemnor.
13. The averments as set out in the said affidavit dated 01.12.2022
has already been considered and rejected by this Court while passing
order dated 05.02.2020. Therefore, it is not be open for the Respondent
no.1 contemnor to reargue the said submissions. In HSBC PI Holdings
(Mauritius) Limited v. Pradeep Shantipershad Jain and Others, 2022
SCC OnLine SC 827, the Supreme Court has held as under:
�66. Now so far as the submissions on behalf of the respondents that there is no wilful disobedience as they have no sufficient funds to deposit the shortfall amount and despite their best efforts, they are unable to get the requisite funds to comply with the order passed by this Court is concerned, at the outset it is required to be noted that all these submissions were made earlier in I.A. No. 68388/2021 seeking exemption from deposit of shortfall pursuant to order dated 06.05.2021 and the same have not been accepted by this Court and vide order dated 02.07.2021 their application for exemption has been dismissed. Thereafter, it shall not be open for the respondents to repeat and make the same submissions again and again. The respondents cannot be permitted to make the same submissions which have not been accepted and/or rejected by this Court earlier. Repetitive submissions which have not been accepted earlier by court
that itself is a wilful disobedience and tantamount to contempt and it shows the conduct on the part of the contemnors.�
(Emphasis supplied)

Order on Sentence
14. This Court is aware that the power to punish for contempt must be exercised with utmost caution. In so far as the order on sentence is concerned, as Respondent no.1 contemnor has already been held guilty for contempt and considering his conduct, as aforesaid, this Court sentences Respondent no.1 contemnor, Mr. Ankur Jain to undergo three
(3) months simple imprisonment along with a fine of Rs. 2,000/-and in default of payment of fine, he shall further undergo 15 days simple imprisonment.
15.
We hereby direct the Registrar General of this court to take necessary steps to have the convicted contemnor taken into custody and cause him to be sent to Central Jail, Tihar under appropriate warrant of commitment for undergoing the sentence awarded as above.

16.
A copy of this judgment shall also be furnished to the convicted contemnor free of cost. He shall be informed by the Superintendent, Central Jail that he has the right to prefer an appeal against the conviction and order on sentence passed by this Court.

17.
With these observations, the present contempt petition and all the pending applications, if any, are disposed of.

MANMEET PRITAM SINGH ARORA, J
January 31, 2023/rhc/kv