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CASE NO.: Contempt Petition (civil)  148 of 2003

PETITIONER: Rama Narang

RESPONDENT: Ramesh Narang & Anr

DATE OF JUDGMENT: 12/04/2006

BENCH: Ruma Pal, B.N. Srikrishna & Dalveer Bhandari

JUDGMENT: J U D G E M E N T

CONTEMPT PETITION NO.148 OF 2003 IN  CP NOS. 265-267 OF 1999 IN CP NO.209 OF 1998 IN CIVIL APPEAL NO. 366 OF 1998

RUMA PAL, J.

In this contempt petition the petitioner alleged that the  respondents 1 and 2 have violated this Court’s orders dated  12th December, 2001 and 8th January, 2002 disposing of  Contempt Petition (Civil) Nos. 265-267/1999 in Contempt  Petition (Civil) No.209 of 1998 in Civil Appeal Nos. 366/1998,  603/1998 and 605/1998.  The petitioner and the respondents  represent two groups of members of one family. The petitioner,  Rama Narang is the father of Ramesh and Rajesh the two  respondents herein. They are the children of his first wife,  whom he divorced in 1963. The petitioner also has children by  the second wife.  Disputes have been raging between the  parties for over a decade.  Several suits and counter suits have  been filed.  In contempt proceedings filed by the respondent  No.1 against the petitioner an order was passed by this Court  on 12th December, 2001 to the following effect:- "The following cases are pending between  the parties who are parties in the present  proceedings before us one way or the  other.  We are told that all the parties  have settled their disputes in respect of  all the litigations specified below.

1.      O.S. No.3535 of 1994 before the  Bombay High Court.

2.      O.S. No.3578 of 1994 before the  Bombay High Court

3.      O.S. No.1105 of 1998 before the  Bombay High Court

4.      O.S. No.3469 of 1996 before the  Bombay High Court

5.      O.S. No.1792 of 1998 before the  Bombay High Court

6.      O.S. No.320 of 1991 before the

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Bombay High Court

7.      Company Petition No.28 1992 before  the Bombay High Court

Before the Principal Bench, Company  Law Board, New Delhi.

8.      Arbitration Suit No.5110 of 1994  before the Bombay High Court.

Today they filed a document styled it as  "MINUTES OF CONSENT ORDER" signed  by all the parties.  Learned counsel  appearing on both sides submitted that  all the parties have signed this document.   Today except Mona Narang and Ramona  Narang (two ladies), all the rest of the  parties are present before us when these  proceedings are dictated.  As for Mona  Narang and Ramona Narang learned  counsel submitted that Mona Narang had  affixed the signatures and the power of  attorney holder of Ramona Narang has  signed the above document in his  presence.  This is recorded.

  Both sides agreed that all the suits can  be disposed of in terms of the settlement  evidenced by "MINUTES OF CONSENT  ORDER" produced before us.  For  disposal of those cases and/or for  passing decrees in them we have to  pronounce the final formal order in terms  of the settlement now produced before us.

 We, therefore, withdraw all the aforesaid  suits to this  Court  under Article 139-A  of the Constitution of India.

   Prothonotory and Senior Master of the  Bombay High Court is directed to  transmit the records in the above  mentioned suits by special messenger to  this Court so as to reach the Registry  here within ten days from today.  The  Bench Officer of the Principal Bench of  the Company Law Board, New Delhi is  directed  to  forward the records relating  to company petition No.28 of 1992 to the  Registry of this Court so as to reach the  Registry within ten days from today.

  All the parties have undertaken before  us that they will implement the terms of  the "MINUTES OF CONSENT ORDER" on  or before 1.1.2002 and that no further  time will be sought for in the matter.

   Clause (f) of the compromise relates to  the operation of the bank accounts. That  clause will come into force from today  onwards.

   All the afore-mentioned suits and the

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company petition will be posted for final  formal orders on 8.1.2002 at 10.30 a.m.  along with these contempt proceedings."

The Minutes of the Consent Order referred to in the order  dated 12th December, 2001 was as an agreement between the  parties, which was duly executed by them.   The bone of contention between the parties is primarily  the control of a company known as NIHL.  The consent  minutes provided inter alia:- (a)     With effect from 4th May, 1999 Rama,  Ramesh and Rajesh are the only  Directors of NIHL (and its  subsidiaries).  Any increase in the  Board of Directors shall be with the  mutual consent of Rama and  Ramesh/Rajesh.

(b)     None of the Directors (Rama,  Ramesh and Rajesh) can be removed  from directorship.

(c)     Rama and Ramesh shall continue to  be in joint management and control  of NIHL and Rajesh shall continue  to be the Permanent Whole Time  Director thereof in charge of day to  day operations/management.

(d)     No decision shall be adopted  concerning or affecting the said  Company (and its subsidiaries)  without the consent of Rama and  Ramesh (or Rajesh) in writing.  It is  further clarified and agreed that  save and except as provided herein  no prevailing decisions including  appointment of Directors/  Executives or any other persons   shall continue unless Rama and  Ramesh (or Rajesh) consent to the  same in writing.

(e)     All the collections coming in cash  shall continue to be remitted in the  bank accounts of the Company and  all transactions will only be made in  the form of cheques and/or as may  hereafter be agreed  to between  Rama and Ramesh (or Rajesh).

(f)     All bank accounts of the Company  shall continue to be operated jointly  by any two out of the three Directors  namely Rama, Ramesh and Rajesh  and/or as may hereafter be agreed  to between Rama and Ramesh(or  Rajesh). If the amount of any  transaction exceeds Rs. 10 (ten) lacs  the same shall be undertaken  through a cheque signed jointly by  Rama and Ramesh/Rajesh."

The consent terms also provide for the performance of  various actions by the parties which are not necessary to be

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recorded.  It is sufficient  to note that  all the agreed actions  were to be performed by the petitioners group before 1.1.2002. When the matter appeared in the list on 8.1.2002 the  Court recorded that all the eight suits and proceedings  withdrawn from other courts had been transmitted. The  appellant’s suits were disposed of in terms of the minutes of  the consent order incorporated  in the proceedings passed by  the Court on 12.12.2001.  The order dated 8th January, 2001  further provided:- "All the above are now being disposed of  in terms of the Minutes of Consent Order  incorporated in the proceedings passed  by us on 12.12.2001.

The decree will be drawn up in terms of  the Minutes of the Consent Order."

On the allegation that the two respondents had violated  the terms of the orders specially the clauses 3(c), (d) and (f) of  the consent minutes, this contempt petition has been filed.  It  is also the case of the petitioner that the violations of the  orders had been admitted by the respondents.  According to  the petitioner the violations amounted to a willful disobedience  of the orders dated 12.12.2001 and 8.1.2002 and were  punishable under this Court’s power of contempt. Initially a notice was issued by this Court on the  petitioners’ application on 9th May, 2003 to the respondents  for ascertaining the facts and to enable them to respond to the  averments in the petition.  After the filing of the responses, on  15th September, 2003, a notice in contempt proceedings was  issued to the respondents.   In an attempt to bring the disputes between the parties  to amicable end, the Court appointed a retired Chief Justice of  Orissa High Court as a mediator.  The mediation was however,  unsuccessful.  Since the settlement of disputes was not  possible, the proceedings before the mediator were terminated  and the contempt petition was directed to be listed for hearing. Before taking up the question whether the respondents  are guilty of contempt as alleged by the petitioner, the  preliminary objection raised by the respondents as to the  maintainability of the contempt petition are addressed.   According to the respondents, the consent order did not  contain an undertaking or an injunction of the Court and  could not be the basis of any proceedings for contempt.   Reliance has been placed on the decision of this Court in Babu  Ram Gupta Vs. Sudhir Bhasin And Anr. 1980(3) SCC 47;  Bank of Baroda Vs. Sadruddin Hasan Daya And Anr. 2004  (1) SCC 360; R.N. Dey And Ors. Vs. Bhagyabati Pramanik &  Ors. 2000(4) SCC 400; Rita Markandey Vs. Surjit Singh  Arora 1996 (6) SCC (14); Nisha Kanto Roy Chowdhury Vs.  Smt. Saroj Bashini Goho AIR 1948 (Cal.) 294; Bajranglal  Gangadhar Khemka & Anr. Vs. Kapurchand Ltd.AIR 1950  (Bombay), 336.  According to the respondents in the absence  of an undertaking given to the Court and an allegation that  such undertaking had been violated, this Court could not  exercise jurisdiction over a mere violation of the terms of  consent order which may have been incorporated in the  consent order.  It was also argued that the order dated  12.12.2001 has in fact been carried out and implemented  within the time specified.  According to the respondents the  order dated 12.12.2001 had merged in the final order dated  8.1.2002.  Reference has been made to the language of the  order dated 8.1.2002 which the respondents submitted, was  the only operative order and which did not in fact contain any  undertaking of the respondents at all.  The respondent’s case

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is that the mere imprimatur of the Court to a consent  arrangement was not sufficient to attract the contempt  jurisdiction.  Only such consent orders which are coupled with  undertakings or injunctions by the Court  could be the subject  matter of contempt proceedings.  The respondents have  argued that in the facts of this case the final order does not  reflect any undertaking except the petitioner’s undertaking to  Rakesh, who was the brother of the respondents 1 and 2. They  have also submitted that the contempt power must be strictly  construed.  Finally, it was submitted that if this Court holds  that the earlier decisions relied upon by the respondents had  been wrongly decided, the same should not serve to proceed  against the respondents, because when the actions  complained were done the law did not treat those actions as  contumacious.  Learned counsel appearing on behalf of the petitioners  has submitted that a decree for injunction whether directory  or prohibitory can only be enforced by way of contempt  proceedings.  It was argued that there was nothing in principle  to draw a rational distinction between the orders passed on  merits and  orders passed by consent.  Our attention was also  drawn to the language of the order dated 12.12.2001 which  directed clause (f) of the minutes to be enforced from that date  onwards. In fact the various suits referred to in the order  dated 8th January, 2002 had been decreed in terms of the  mutual consent order.   It has also been submitted that all the  relevant clauses in the consent minutes could be read both as  prohibitory and directory.  The petitioner has submitted that  in a civil contempt, the issue is not so much the punishment  of the alleged contemnor, but the execution of the decree.   According to the petitioner,  all the decisions cited by the  respondents were distinguishable. Reliance has been placed  on the definition of civil contempt in the Contempt of Courts  Act, 1971 as well as on the decisions in Rosnan Sam Boyce  Vs. B.R. Cotton Mills Ltd. & Ors. 1990 (2) SCC 636; C.H.  Giles V. Morris & Ors. 1972 (1) All ER 1960; and Salkia  Businessmen’s Association & Ors. Vs. Howrah Municipal  Corporation & Ors. 2001 (6) SCC 688. Prior to the enactment of the Contempt of Courts Act,  1971 (referred to hereafter as the Act), the field was governed  by the Contempt of Courts Act, 1952  which did not contain  many of the provisions which have  been introduced for the  first time by the 1971 Act. Till the 1971 Act, the policy of the  legislature was to leave the formulation of the law of contempt  to the Courts.  The provisions of the Contempt of Courts Act  1952 were, therefore, broadly framed.  Consequently, there  was  often a conflict between the practice in a Court and the  judicial decisions and sometimes conflict between the views of  the different High Courts on the law applicable.   An instance of such conflict is the case of Nisha Kanto  Roy Chowdhury V. Smt. Saroj Bashini Goho AIR 1948 Cal  294. In that case, a suit had been filed for ejectment by the  respondent of the appellant.  The suit was not contested.   Terms of compromise were drafted and a decree passed in  terms of the compromise.  One of the clauses of the  compromise contained an undertaking of the appellant to  remove the image of the deity which had been installed by the  appellant together with the structures around the deity  on  demand by the respondent-landlord.  However,  when the  respondent called upon the appellant to remove the image, the  appellant refused.  The respondent then filed an application  before the High Court to commit the appellant for contempt of  Court on the ground that he had broken an undertaking  which had been given to the  Court that he would remove the  image when called upon to do so by the respondent. The

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Single Judge allowed the application and committed the  appellant holding that he had violated the order of the Court.   On  appeal, however, the Division Bench differed with the  views expressed by the learned Single Judge.  It was held that  the clause which recorded the appellant’s undertaking to  remove the image did not state that the defendant undertook  "to the Court" to remove the image.  The word "undertakes"  was construed to mean "formal promise or pledge".  It was  held that the appellant had thus merely promised or pledged  the respondent to remove the image.  The Court was no party  to that promise at that stage.  It was also said that: "It must be remembered that a  compromise decree is nothing more  than an agreement of the parties  with the sanction of the Court  super-added.  It has really no  greater sanctity than the agreement  itself.  It certainly cannot mean  anything more than the agreement  itself."

When it was pointed out that the practice on the original  side of the High Court was to record  an undertaking to the  Court in that manner and that this practice had been  endorsed in several earlier decisions, the Division Bench  opined that if that was so then "sooner the practice is  stopped is better".  It was affirmed that if it was the intention  of the parties that an undertaking should be given to the  Court then the compromise should have made it clear that  such was the case. A different view was taken by the Division Bench of the  Bombay High Court in Bajranglal Gangadhar Khemka and  Anr. V. Kapurchand Ltd. AIR 1950 (Bom.) 336.  In that  case, a suit for specific performance by execution of a lease  was compromised and consent terms were filed in Court and  an order passed thereon. One of the terms in the compromise  recorded an undertaking by the defendants to have a third  party joined as a confirming party to the lease which the  defendant had agreed to execute in favour of the plaintiff.   The defendant failed to execute the lease.  The plaintiff took  out proceedings for execution and the lease was executed by  an officer of Court.  The defendant then refused to get the  third party to confirm the lease in terms of his undertaking.   The plaintiff took out an application for contempt of Court.   The Single Judge allowed the application holding that the  defendant was guilty of willful default and asked the  defendant to carry out the undertaking within one month  failing which a warrant of arrest would issue.  In the appeal  preferred by the defendant, it was contended by him that no  undertaking was given by the defendant to Court.  Reliance  was placed on the decision of the Calcutta High Court in  Nisha Kanto’s case.  The Division Bench rejected the  submission and dismissed the appeal saying: "We are not prepared to accept a  position which seems to us contrary  to the long practice that has been  established in this Court."

The Court opined that:

"\005\005\005\005\005\005 the expression  "undertake" has come to acquire

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through long practice, a technical  meaning.  In all orders and decrees  of the Court, whenever the  expression "a party undertakes"   has been used, it has always borne  the meaning that the undertaking  has been to the Court.

What is more, it has been held by  Bhagwati J.--- an opinion with  which I entirely agree\027that it has  been the long standing practice on  the original side that, whenever  counsel wishes to give an  undertaking to the Court, he never  expressly uses the words " to the  Court" but merely states that he  undertakes on behalf of his  client\005."

Accordingly it was concluded:

"\005.\005.we can only construe the  undertaking given by the defendants  as an undertaking given to the  Court and not given to the other  side\005\005\005\005\005\005\005\005\005\005\005\005\005\005\005\005 \005\005\005The very fact that the Court  passed a decree after an  undertaking was embodied in the  consent terms clearly shows that  the Court did sanction a particular  course; and that course was the  putting of its imprimatur  upon the  consent terms.  The Court was led  to  pass an order upon the  defendants to execute a lease in  view of the fact that an undertaking  was given by the defendants to get  the Paradise Cinema, Limited, to  join the lease."

The view expressed by the Bombay High Court has, in  our opinion, been approved by this Court in Bank of Baroda  V. Sadruddin Hasan Daya 2004 (1) SCC 360.   The Calcutta  High Court’s judgment to the contrary in Nisha Kanto Roy  Chowdhury (supra) does not therefore correctly reflect the  law. In the face of such apparent divergence, the Sanyal  Committee was set up and asked to examine the law of  contempt with a view to its clarification and reforming it  wherever necessary.  The present statute is the outcome of  those suggestions.   The Sanyal Committee Report which preceded the  framing the enactment of the Act had opined: "The 1952 Act is sound as far as it  goes.  While its provisions may  be  retained, its scope requires to be  widened considerably."

The Act has been duly widened.  It provides inter-alia for  definitions of the terms and lays down firmer bases for  exercise of the Court’s jurisdiction in contempt.  Section 2(b) of  the Contempt of Courts Act, 1971 defines civil contempt  as

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meaning "willful disobedience to any judgment decree,  direction, order, writ or other process of a Court or willful  breach of an undertaking given to Court".   Analysed, the  definition provides for two categories of cases, namely, (1)  willful disobedience to a process of Court and (2) willful breach  of an undertaking given to Court.  As far as the first category  is concerned, the word "any" further indicates the wide nature  of the power.  No distinction is statutorily drawn between an  order passed after an adjudication and an order passed by  consent.  This first category is separate from the second and  cannot be treated as forming part of or taking colour from the  second category.  The legislative intention clearly was to  distinguish between the two and create distinct classes of  contumacious behaviour.  Interestingly, the Courts in England  have held that the breach of a consent decree of specific  performance by refusal to execute the agreement is punishable  by way of proceedings in contempt (see C.H. Giles and  Company Ltd. Vs. Morris and Ors. 1972 (1) All ER 960). The two decisions of the Calcutta and Bombay High  Court are limited to the second category of cases mentioned  against Section 2(b) of the 1971 Act.  Incidentally, nether of  the decisions held that a violation of breach of any other  terms of a consent order would not amount to contempt if it  were willful.   We proceed on the basis that no undertaking was given  to Court by the respondents in the consent minutes and that  therefore there was no question of their violating such  undertaking.  The only question is, whether the respondents  could be called upon to answer proceedings in contempt for  willful disobedience to this Court’s orders dated 12th  December 2001 and 8th January 2002.          After the Act came into force, in 1980 this Court was  called upon to dispose of an appeal filed under Section 19 of  the Act against a decision of the Division Bench of the Delhi  High Court convicting the appellant under Section 2(b) of the  1971 Act and sentencing him to prison.    The case Babu  Ram Gupta V. Sudhir Bhasin 1980 (3) SCC 47, arose out of  a dispute between the partners.  The partnership deed  contained an arbitration clause.  An application was filed by  one of the parties under Section 20 of the Arbitration Act.   Pending the application, a receiver was appointed.  An appeal  was preferred from this order.  A consent order was passed  appointing ’X’ as the receiver.  The appellant was then in  possession of the property.  He did not hand over possession  of the property to the receiver.   An application was filed  alleging that the appellant had committed a serious breach of  the undertaking given to the Court to hand over possession  to the receiver.  The High Court had so found. This Court  construed the consent order and came to the conclusion that  it did not contain any express direction to the appellant to  hand over possession of the property to the receiver  It was  held that no undertaking had been given by the appellant at  all.  The High Court had proceeded, according to this Court,  erroneously by implying an undertaking from the consent  order itself.  In that context, this Court said:     

"There is a clear-cut distinction  between a compromise arrived at  between the parties or a consent  order passed by the Court at the  instance of the parties and a clear  and categorical undertaking given  by any of the parties.  In the former,  if there is violation of the  compromise or the order no

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question  of contempt of court  arises, but the party  has a right to  enforce the order or the compromise  by either executing the order or  getting an injunction from the  court."

The Court then considered various consent orders  which could not base proceedings for contempt if the consent  order were violated.  Thus for example, a decree for payment  of money if not complied with could not found an action for  contempt.  Similarly the allocation of certain property to a  party by consent would not give rise to proceedings of  contempt if possession of property was not given to that  party.   The Court was of the view that:

"In the absence of any express  undertaking given by the appellant  or any undertaking incorporated in  the order impugned, it will be  difficult to hold that the appellant  willfully disobeyed or committed  breach of such an  undertaking\005\005\005\005\005\005\005\005\005\005\005 \005\005\005\005. If we were to hold that  non-compliance of a compromise  decree or consent order amounts to  contempt of court, the provisions of  the Code of Civil Procedure relating  to execution of decrees may not be  resorted to at all.  In fact , the  reason why a breach of clear  undertaking given to the court  amounts to contempt of court is  that the contemner by making a  false representation to the court  obtains a benefit for himself and if  he fails to honour the undertaking,  he plays a serious fraud on the  court itself and thereby obstructs  the course of justice and brings into  disrepute the judicial institution.  The same cannot, however, be said  of consent order or a compromise  decree where the fraud, if any, is  practiced by the person concerned  not on the court but on one of the  parties.  Thus, the offence  committed by the person concerned  is qua the party not qua the court,  and therefore, the very foundation  for proceeding for contempt of court  is completely absent in such case."

The appeal was accordingly allowed and the order passed  under Section 2(b) Act set aside. The question which was before the Court in Babu Ram  Gupta’s case was limited to the issue whether the appellant  had given any undertaking to the Court, either expressly or  impliedly, which he had violated. In other words it was limited  to the second category of cases mentioned under Section 2(b)  of the Act.  The Court was not called upon to decide whether  there was any contumacious  conduct as envisaged by the first  category of cases under that Section.  The observations made

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in that regard, are strictly speaking, obiter.  The Court was not  called upon to consider nor did it construe the language of  Section 2(b) of the Act.  If we were to accept the observations of  the Court as an enunciation of the law, it would run contrary  to the express language of the statute. As we have earlier  noted, the section itself provides that willful violation of any  order or decree etc. would   tantamount to  contempt.  A  compromise decree is as much a decree as a decree passed on  adjudication.  It is not as has been wrongly held by the  Calcutta High Court in Nisha Kanto Roy Chowdhury (supra)  merely an agreement between the parties.  In passing the  decree by consent, the Court adds its mandate to the consent.   A consent decree is composed of both a command and a  contract.  The Bombay High Court’s view in Bajranglal  Gangadhar Khemka (supra) correctly represents the law that  a consent decree is a contract with the imprimatur of the  Court.  ’Imprimatur’ means ’authorized’ or ’approved’.  In other  words by passing a decree in terms of a consent order the  Court authorizes and approves the course of action consented  to.   Moreover, the provisions of Order 23 Rule 3 of the Code of  Civil Procedure requires the Court to pass a decree in  accordance with the consent terms only when it is proved to  the satisfaction of the court that a suit has been adjusted  wholly or in part by any lawful agreement         All decrees and orders are executable under the Code of  Civil Procedure. Consent decrees or orders are of course also  executable. But merely because an order or decree is  executable,  would not take away the Courts jurisdiction to  deal with a matter under the Act provided the Court is  satisfied that the violation of the order or decree is such, that  if proved, it would warrant punishment under Section 13 of  the Act on the ground that the contempt substantially  interferes or tends substantially to interfere with the due  course of justice.  The decisions relied upon by the  respondents themselves hold so as we shall subsequently see.             In such circumstances it would neither be in consonance  with the statute, judicial authority, principle or logic to draw  any distinction between the willful violation of the terms of a  consent decree and willful violation of a decree which is  passed on adjudication.  The decision in Baburam Gupta’s  case must, therefore, be limited to its own peculiar facts. Rita Markandeya Vs. Surjit Singh Arora (1996) 6 SCC  14, which was also been relied upon by the respondents to  urge that the present application for contempt was not  maintainable, related to proceedings for eviction.  The  respondent, who was the tenant had been directed to vacate  the tenanted premises.  His appeal before this Court was  dismissed. While dismissing  the appeal the Court recorded:- "However, as agreed to by both the  learned counsel, time to hand over  vacant possession to Smt. Rita  Markandey is granted  till  31.3.1995. This shall be subject to  the usual undertaking to be filed by  the appellant-tenant within four  weeks from today."

The respondent did not file the undertaking. He also did  not vacate the tenanted premises by the agreed date.  The  landlord-appellant then filed a petition alleging that the  respondent had committed contempt of court by gaining time  from the Court to vacate the premises only to file an  undertaking and thereafter refusing to file the undertaking.   The Court found, on an interpretation of  its order, that the  court had not itself passed any order fixing the time.  In terms

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of the agreement between the parties the time had been fixed  and the Court had only "embodied the terms of the agreement  so arrived at." Therefore, it was held that the respondent could  not be held liable for contempt of that order.     The respondents herein have however, relied upon the  following passage in the judgment claiming that the same  supported their contention:- "Law is well settled that if any party  gives an undertaking to the court to  vacate the premises from which he is  liable to be evicted under the orders  of the court and there is a clear and  deliberate breach thereof it amounts  to civil contempt but since, in the  present case, the respondent did not  file any undertaking as envisaged in  the order of this Court the question of  his  being punished for breach  thereof does not arise.  However, in  our considered view even in case  where no such undertaking is given,  a party to a litigation may be held  liable for such contempt if the court  is induced to sanction a particular  course of action or inaction on the  basis of the representation of such a  party and the court ultimately finds  that the party never intended to act  on such representation or such  representation was false."

This passage is an exposition of the law relating to the  second category of cases covered by Section 2(b) of the Act.  It  does not seek to be an exposition of the law relating to the first  category of cases at all. The next decision relied upon by the respondents is the  decision of this Court in Bank of Baroda Vs. Sadruddin  Hasan Daya  & Anr. 2004(1) SCC 360. The petitioner in that  case had filed a suit against the respondents for recovery of   money.  The suit was disposed of by consent and a decree was  passed incorporating the consent terms.  The consent  terms  inter alia, provided for payment of the decretal amount in   instalments. Pending the clearance of the decretal amount the  respondents undertook not to sell, mortgage, alienate,  encumber or charge some of its properties. Another creditor  also filed the suit against the respondent for recovery of a  certain amount.  This second suit was also disposed of by  consent and a decree passed in terms of the consent order.   Like the first decree  the decreed amount was to be satisfied in  instalments and pending satisfaction of the decree, the  respondents undertook to the Court  not to alienate,  encumber, or create third  party rights or part with possession  of the same properties which had already formed part of the  undertaking in the first decree.  The respondents defaulted in  making payment of the instalments under the first decree.   The petitioner put the decree into execution.  It also filed a  contempt petition alleging that the second consent decree  violated the undertaking given in the first decree.  The Court  found that by placing the same property under attachment in  the second decree the respondent had intentionally and  deliberately acted in breach of the undertaking given to the  Court in the first consent decree.  The Court approved the  statement of the law by the Bombay High Court in Bajranglal  Gangadhar Khemka & Anr. Vs. Kapurchand Ltd.(supra).   Significantly, the Court also said:

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"The violation or breach of the  undertaking which become part of  the decree of the court certainly  amounts to contempt of court,  irrespective of the fact that it is open  to the decree-holder to execute the  decree."                (Emphasis added)

This decision reinforces our view of the law.  It does not  in any way run contrary to our opinion as expressed earlier on  the interpretation to be put on Section 2(b) of the Act.  On the  other hand the  Court repelled the submission of the  respondents that the petitioners remedy lay in executing the  decree  in the following words:- " The fact that  the petitioner can  execute the decree can have no  bearing on the contempt committed  by the respondents."

The decision in R.N. Dey and Anr Vs. Bhagyabati  Pramanik & Ors 2000(4) SCC 400,  also relied upon by the  respondents, disposed of an appeal filed from an order  directing the appellants to deposit certain amounts of money  towards compensation money payable in respect of land  acquisition proceedings.  The directions were given while  disposing of contempt proceedings initiated by the respondent  after the Court had accepted the unqualified apology tendered  by the appellants.  The appellants urged that instead of filing a  contempt application, the respondent should have proceeded  with the execution of the decree or award made in the land  acquisition proceedings.  The Court said that:- "\005 the weapon of contempt is not to  be used in abundance or misused.   Normally, it cannot be used for  execution of the decree or  implementation of an order for  which alternative remedy in law is  provided for.  Discretion given to the  court is to be exercised for  maintenance of the court’s dignity  and majesty of law."

Furthermore, it has also said that:- "\005 the decree-holder, who does not  take  steps to execute the decree in  accordance with the procedure  prescribed by law, should not be  encouraged to invoke contempt  jurisdiction of the court for non- satisfaction of the money decree."

Having regard to the facts of the case the Court felt that  the contempt proceedings should not have been resorted to  and that in any case since the unconditional apology has been  tendered  and accepted by the appellant further proceedings  should have been dropped.  As we read the decision, its ratio runs counter to the  submission of the respondents, namely, that the contempt  would not lie if the decree or order is executable.  Ultimately,  the matter is one of the Court’s discretion having regard to the  facts of the case.  As we have said the fact that a decree is  executable does not take away the Court’s jurisdiction in  contempt. In the present case, the consent terms arrived at between

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the parties was incorporated in the orders passed by the Court  on 12th December 2001 and 8th January 2002.  The decree as  drawn up shows that order dated 8th January, 2002 was to be  "punctually observed and carried into execution by all  concerned".   A violation of the terms of the consent order  would amount to a violation of the Court’s orders dated 12th  December 2001 and 8th January 2002 and, therefore be  punishable under the first limb of Section 2(b) of the Contempt  of Courts Act, 1971. The question whether the respondents  should not be held guilty of contempt because of any earlier  confusion in the law reflected in the case of Babu Ram Gupta  (supra), is a question which must be left for decision while  disposing  of the contempt petition on merits.  It may be  argued as an extenuating or mitigating factor once the  respondents are held guilty  of contempt.  The submission  does not pertain to the maintainability of the petition for  contempt.  The preliminary objection raised by the  respondents regarding the non-maintainability of the petition  for contempt is, for the reasons stated, dismissed.  The issue as to whether the respondents have in fact  acted in violation of the terms of the consent order will now  have to be decided on merits.  Let the matter be listed for this  purpose.  Costs of this petition will be costs in the  contempt  petition.