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TMI Blog2021 (8) TMI 867X X X X Extracts X X X X X X X X Extracts X X X X ..... Paragraph 3 "Though notices were issued to the Respondent, none appeared for the Respondent. Therefore, it is not known whether the contemnor is financially solvent or not, in order to initiate contempt proceedings. Therefore, we are not inclined to initiate Contempt Proceedings" and gave liberty to the 'Appellant/Petitioner' to persuade the Contemnors to pay the outstanding amount. CONTEMPT PETITION AVERMENTS: 3. In this connection this 'Tribunal' usefully refers to the contents of Contempt Petition No. 01/2020 in CP (IB) No. 90/BB/2017 on the file of the Adjudicating Authority (National Company Law Tribunal, Bengaluru Bench) whereby and whereunder at paragraph 17 to 19 it is averred as under: "............ the Ex- Resolution Professional is left with no option and has filed the present contempt petition for action against the Corporate Debtor/Mr. Kesava Kola and a request for payment of the said amount of 11,92,822/- together with damages, as may be decided by this Hon'ble Tribunal, and also for directions for compliance with the Order dated 25th July 2018, 10th December 2018, 8th July, 2019 and 1st October, 2019. 4. Even after a period of One and half year, the Corporate D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee of Creditors in its first meeting. 7. The Learned Counsel for the Appellant brings to the notice of this Tribunal that the Respondent filed Comp App (AT)(Ins) N0. 36/2018 questioning the Order of Admission whereby the CIRP was initiated against the Corporate Debtor. As matter of fact, the Appellant, during the pendency of the Appeal, by means of an order dated 27.02.2018 passed by this Tribunal had directed the Appellant to continue the duties as mandated under the provisions of the I & B Code. 8. The Learned Counsel for the Appellant points out that this Tribunal on 18.07.2018 had allowed the Comp App (AT)(Ins) 36/2018 by setting aside the order admitting the CIRP of the Corporate Debtor and directed the Adjudicating the Authority to fix the fees of the Appellant for the period of almost six months wherein seven meetings of 'Committee of Creditors' were convened during the CIRP period. 9. The Learned Counsel for the Appellant advert ss to the order dated 25.07.2018 of the Adjudicating Authority wherein the Corporate Debtor was directed to pay Rs. 75,000/- per month + 'Valuation Certificate' and 'Advertisement cost' to the Resolution Professional for the period of six and hal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for two weeks' time to comply with the order dated 25.07.2018 in IA 429/2019 on 01.10.2019. APPELLANT'S SUBMISSIONS: 16. The main grievance of the Appellant is that the Adjudicating Authority while passing the impugned order dated 10.02.2021had failed to exercise his powers, in terms of section 425 of the Companies Act, 2013 thereby punishing the Respondent for Contempt. 17. The other contention advanced on behalf of the Appellant is that even though the Respondent had wilfully and deliberately defaulted and every now and then failed to pay the Appellant's fees, despite numerous directions given by the Appellate Tribunal as well as by the Adjudicating Authority. 18.The Learned Counsel for the Appellant submits that the impugned order passed by the Adjudicating Authority declining to initiate contempt proceedings against the Respondent under the pretext that whether it is Respondent financially solvent or not' is clearly unsustainable in the eye of Law. 19. The Learned Counsel for the Appellant points out that the Appellant/ Interim Resolution Professional being an officer appointed by the Adjudicating Authority is running from pillar to post to receive his fees as well as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the directions issued therein then it will be better to direct the parties to approach the Court which disposed of the matter for clarification of the order instead of the Court exercising contempt jurisdiction taking upon itself the power to decide the original proceeding in a manner not dealt with by the Court passing the judgment or order. If this limitation is borne in mind then criticisms which are sometimes levelled against the Courts exercising contempt of Court Jurisdiction "that it has exceeded its powers granting substantive relief and issuing a direction regarding the same without proper adjudication of the dispute" in its entirety can be avoided. This will also avoid multiplicity of proceedings because the party which is prejudicially affected by the judgment or order passed in the contempt proceeding and granting relief and issuing fresh directions is likely to challenge that order and that may give rise to another round of litigation arising from a proceeding which is intended to maintain the majesty and image of Courts". 21. The Learned Counsel for the Appellant relies on the decision of the Hon'ble Supreme Court in Alok Kaushik V Bhuvaneshwari Ramanathan reported i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms of other professionals which form part of the CIRP cots. 21. We accordingly allow the appeal and se aside the impugned judgment and order of the NCLAT dated 13 October 2020. The proceedings shall accordingly stand remitted back of the NCLT for determining the claim of the Appellant for the payment of the processional charges as a registered Valuer appointed by the RP in pursuance of the initiation of the CIRP. In order to facilitate a fresh determination by the NCLT, the order passed by the NCLT on 18 December 2019 is also set aside and CA No. 192 of 2020 shall stand restored to the file of NCLT for determination afresh in the light of the above observations". 22. The Learned Counsel for the Appellant refers to the judgement of the Hon'ble Supreme Court in Ram Kishan V Tarun Bajaj & ors reported in (2014) 16 SCC 201 wherein at paragraph 9 and 10 it is observed as under: 9. "Contempt jurisdiction conferred on to the law Courts power to punish an offender for his wilful disobedience/contumacious conduct or obstruction to the majesty of law, for the reason that respect and authority commanded by the Courts of law are the greatest guarantee or an ordinary citizens that his righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... possible for the contemnor to comply with the order, the contemnor cannot be punished. Committal or sequestration will not be ordered unless contempt involves a degree of default or misconduct. (Vide: S. Sundaram Pillar Etc V V, R Pattabiraman; MANU/SC/0387/1985: AIR 1985 SC 582; Rakapalli Raja Rama Gopala Rao V Naragani Govinda Sehararao and Anr , MANU/SC/0441/1989; AIR 1989 SC 2185; Niaz Mohammad and ors etc V State of Haryana and Ors ; MANU/SC/0063/1995; AIR 1995 SC 308; Chordia Automobiles V S Moosa MANU/SC/0139/2000 AIR 2000 SC 1880; Ashok Paper Kamgar Union and Ors V Dharam Ghdha and Ors MANU/SC/0679/2003: AIR 2004 SC 105: State of Orissa and Ors V Md. Illiyas MANU/SC/2004/2005 : AIR 2006 SC 258 and Uniworth Textiles Ltd V CCE, Raipur MANU/SC/0060/2013 : (2013) 9 SCC 753). 23. Apart from the above, the Learned Counsel for the Appellant cites the judgment dated 12.03.2020 of this Tribunal (Three Member Bench) in Comp App (AT)(Ins) No. 1113/2019 in the matter of Manoj K Daga V ISGEC Heavy Engineering Ltd, Noida - 201301 and others wherein at paragraph 22 it is inter alia observed as under: "...... The Appellant and Deepak Daga kept telling this Tribunal that they would retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , caution, and utmost circumspection, when an adverse act affects the administration of justice' or which tends to shake public confidence in the judicial institutions or to impede its course. 26. It is relevantly pointed out that to instil confidence of the public in general for due and proper administration of justice in the country, the Contempt of Court Act, 1971 was introduced as per decision of Hon'ble Supreme Court in Prem Surana V Additional Munsif and Judicial Magistrate reported in AIR 2002 SC 2956. 27. It will be a travesty of justice if the 'Tribunal'/ 'Court of Law' were to permit gross contempt of Tribunal/Court of Law to go unpunished, if there be no mitigating factors/circumstances, in the considered opinion of this Tribunal a wilful breach of an undertaking given to a Tribunal/Court may amount to Contemptuous Act, coming within the meaning of Section 2(b) of the Contempt of Courts Act, 1971. EVALUATION: 28. In the present case on hand, on behalf of the contemnor/respondent no one appeared before the Adjudicating Authority in Contempt Petition No. 01 /2020 in CP (IB) No. 90/BB/2017, not withstanding the fact the matter was listed on numerous occasions. As a matt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of the Contempt Petition No. 01 /2020 in CP (IB) No. 90/BB/2017 by granting liberty to the Appellant/petitioner to persuade the contemnor/respondent to pay the outstanding amount and in this regard, the Tribunal by passing the impugned order had not exercised its jurisdiction vested in it, in a proper and legal manner. Suffice it for the Tribunal to make a relevant mention that the impugned order dated 10.02.2021 in Contempt Petition No. 01 /2020 in CP (IB) No. 90/BB/2017 bristles with legal infirmities and accordingly, this Tribunal interferes with the said order and set aside the same to secure the ends of justice. Resultantly, the Appeal succeeds. DISPOSTION: In fine, the Comp App (AT)(CH) (Ins) No. 94/2021 is allowed. No costs. The impugned order in Contempt Petition No. 01 /2020 in CP (IB) No. 90/BB/2017 on the file of the 'Adjudicating Authority' (National Company Law Tribunal, Bengaluru Bench) is set aside and the matter is remitted back to the 'Adjudicating Authority' (National Company Law Tribunal, Bengaluru Bench) for passing necessary orders afresh (after restoring Contempt Petition No. 01 /2020 in CP (IB) No. 90/BB/2017 to its file) on merits, (bearing in mind of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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