2025 INSC 567 Contempt Petition (C) No. 712 of 2023 Page 1 of 19

REPORTABLE

IN THE SUPREME COURT OF INDIA

INHERENT JURISDICTION

CONTEMPT PETITION (CIVIL) NO. 712 OF 2023

IN

SLP (CIVIL) NO. 17433 OF 2021

M/S CHITHRA WOODS MANORS

WELFARE ASSOCIATION PETITIONER (S)

VERSUS

SHAJI AUGUSTINE ALLEGED CONTEMNOR/RESPONDENT

J U D G M E N T

AUGUSTINE GEORGE MASIH, J .

1. The instant Contempt Petition (Civil) No. 712 of 2023

(hereinafter referred to as “instant Petition”) in SLP (C) No.

17433 of 2021 (hereinafter referred to as “main Petition”)

was filed during its pendency by M/s Chithra Woods

Manors Welfare Association, being the Respondent No. 01

therein (hereinafter referred to as “Petitioner Association”),

alleging non-payment of arrears of use and occupation

charges for period between 20.09.2021 and 31.11.2022 in

six monthly instalments beginning 31.12.2022, as

Contempt Petition (C) No. 712 of 2023 Page 2 of 19

directed by this Court vide Order dated 07.11.2022 in the

main Petition.

2. This petition was then tagged along with the main Petition

vide Order dated 24.02.2023 and eventually, owing to the

said non-payment of arrears, the main Petition was

disposed of as this Court observed to not entertain the

prayer of Mr Shaji Augustine, the Petitioner therein

(hereinafter referred to as “Respondent-Contemnor”) but

the proceedings in instant Petition sustained.

3. Facts forming the backdrop of the instant Petition are that

the Petitioner Association is owner of the decree scheduled

building, consisting of 96 furnished studio apartments, at

Munnar, Kerala (hereinafter referred to as the “said

Property”). An agreement was entered between the

Petitioner Association and Respondent-Contemnor on

26.01.2014, permitting the latter to occupy and use the

said Property for a period of 10 years as against payment

of licence fees of INR 12 Lakhs per month (hereinafter

referred to as the “said Agreement).

4. Within a short period of entering into the said Agreement,

Respondent-Contemnor defaulted in payment of the

license fees. On persistent default, Petitioner Association

was constrained to institute OS No.30 of 2015 before the

Sub Court at Thodupuzha, Kerala for realization of the

arrears and other reliefs. As there was an arbitration

clause in the said Agreement and on consent of the parties

herein, the dispute was referred to a Sole Arbitrator.

Contempt Petition (C) No. 712 of 2023 Page 3 of 19

5. Before the Sole Arbitrator, the Petitioner Association

moved I.A. No. 01 of 2016 under Section 17 of the

Arbitration and Conciliation Act, 1996 (hereinafter referred

to as “A&C Act”), seeking direction to the Respondent-

Contemnor to deposit INR 1,65,73,459/ - (Rupees One

crore Sixty-Five Lakhs Seventy-Three Thousand Four

Hundred Fifty-Nine only) during pendency of the

proceedings. The same was partially allowed vide Order

dated 23.06.2016 with direction to deposit INR

1,36,49,439/- (Rupees One crore Thirty-Six Lakhs Forty-

Nine Thousand Four Hundred Thirty-Nine only) and per

undertaking of the Respondent-Contemnor, payment of

INR 12 lakhs per mensem for month of June 2016

onwards, on or before the 10

th of the succeeding month,

pending disposal of the proceedings.

6. Both Respondent-Contemnor and Petitioner Association

moved in appeal under Section 37 of the A&C Act before

the District Court at Ernakulam, Kerala. A Common Order

dated 21.01.2017 was passed, staying the proceedings

before the Sole Arbitrator with reiteration of direction to

Respondent-Contemnor to pay arrears at the rate of INR

12 Lakhs per month with effect from 08.09.2016 with a

further order to continue to pay INR 12 Lakhs per month

towards monthly license fee.

7. This common order was challenged by the Respondent -

Contemnor before the High Court of Kerala in O.P. (C) No

552 of 2017. The matter was referred for mediation at the

Contempt Petition (C) No. 712 of 2023 Page 4 of 19

request of the parties. The said mediation proceedings,

lead to a Compromise dated 03.04.2017 (hereinafter

referred to as the “Settlement Agreement”), Petitioner

Association agreed to reduce the monthly license fees to

INR 8 Lakhs per month. Arrears, as claimed before the Sole

Arbitrator, were also reduced from INR 1,65,73,439/- to

INR 75 Lakhs. Moreover, it was specifically recorded that

the settlement entered between the parties would form

part of the judgment. There was a specific clause that in

case of default by any of the parties to any of the terms of

the agreement the other would be entitled to proceed

against the other party. The parties resolved their

disputes, and the terms of settlement arrived at between

them were accepted by the High Court of Kerala and were

incorporated in the Order dated 11.04.2017.

8. On default on the part of the Respondent-Contemnor in

making payment through a promissory note, as per the

Settlement Agreement, Petitioner Association preferred

Execution Petition No. 58 of 2020 on 11.03.2020, no

money was paid by the Respondent-Contemnor with effect

from the month of July 2018. The Respondent-Contemnor

was unsuccessful before the District Court in EA No. 14 of

2021 in its challenge to the maintainability of the

execution petition. The Execution Court passed an Order

dated 23.03.2021, giving an instalment facility to the

Respondent-Contemnor for payments of its arrears, with

the first being due on 01.06.2021 and the last being

Contempt Petition (C) No. 712 of 2023 Page 5 of 19

01.09.2021. Furthermore, the amount of arrears being

undisputed, and nothing having been paid, the Execution

Court ordered delivery of the said Property. The

Respondent-Contemnor challenged the order of the

Execution Court before the High Court of Kerala, which

was dismissed vide Judgment dated 20.09.2021.

9. It is at this stage that the respondent preferred the main

Petition before this Court challenging the Judgment dated

20.09.2021. Notice was issued vide Order dated

12.11.2021 and subsequently, status quo was ordered

vide Order dated 04.02.2022 vis-à-vis the said Property.

The matter ultimately came for consideration on

07.11.2022 when following Order was passed:-

“List on a non-miscellaneous day in the month of

March, 2023.

In the meanwhile, as an interim measure, we are

inclined to direct that the petitioner will pay Rs. 12

lakhs per month to the respondent as use and

occupation charges w.e.f. 20.09.2021 (the date of the

impugned judgment). As prayed on behalf of the

petitioner, the arrears @ Rs. 12 lakhs per month from

20.09.2021 till 31.11.2022, would be paid in six

monthly instalments beginning 31.12.2022. The

petitioner would also continue to make payment of Rs.

12 lakhs per month in the future by the 10

th

day of each

succeeding calendar month.

The payment would be subject to the outcome of the

present Special Leave Petition.”

10. A perusal of the above would show that a direction was

issued to the Respondent-Contemnor to pay arrears for the

period specified therein in six monthly instalments

beginning from 31.12.2022, totalling to INR 172 Lakhs, at

Contempt Petition (C) No. 712 of 2023 Page 6 of 19

the rate of INR 12 Lakhs per month, and being INR 28.60

Lakhs per instalment.

11. Pursuant to the Order dated 07.11.2022, the Respondent-

Contemnor sent an e-mail to the Petitioner Association

containing a letter dated 17.11.2022 seeking the

concerned account details of the Petitioner Association for

the Respondent-Contemnor to transfer the arrears

enabling him to affect compliance with Order dated

07.11.2022 passed by this Court. The said details were

provided by the Petitioner Association on 14.12.2022 in

response to the aforesaid e-mail. Despite getting the

required information, no amount was paid to the Petitioner

Association and yet, the Respondent -Contemnor

continued to enjoy and occupy the said Property. It is

apparent that the intention on the part of the Respondent-

Contemnor was not to do away with the possession of the

said Property and to hold on to it owing to his act of moving

the main Petition for challenging the handing over of the

possession of the said Property.

12. Petitioner Association asserts that deliberate action on

behalf of the respondent in not complying with the

direction issued by this Court on 17.11.2022 with

continuous default on his part amounts to civil contempt

which is deliberate and intentional disobedience of the

order of this Court.

Contempt Petition (C) No. 712 of 2023 Page 7 of 19

13. Subsequently, on 01.12.2023, when both the main

Petition and instant Petition were taken up for hearing

following order was passed:-

“The learned counsel appearing for the petitioner

states that the petitioner has already vacated the

premises subject matter of this Special Leave Petition.

We find that the order dated 7

th

November, 2022

directing the petitioner to deposit money has not been

complied with. The petitioner has expressed inability to

pay the money. The jurisdiction of this Court under

Article 136 of the Constitution of India is always

discretionary.

Considering the conduct of the petitioner of not paying

a single farthing after 7

th

November, 2022, we decline

to entertain this Special Leave Petition and the same is

accordingly dismissed.

However, the question of law is kept open to be

considered in an appropriate case.

Pending application also stand disposed of.

CONMT. PET. (C) No. 712/2023 in SLP(C) No.

17433/2021.

List on 22

nd

January, 2024.”

14. With the main Petition having been dismissed, the instant

Petition continued to survive and was taken up for hearing

on various dates. Respondent-Contemnor was called upon

by this Court on 15.03.2024 to file an affidavit giving

details of all his movable and immovable assets as also

that of his immediate family members along with the

necessary documents. This was in light of the statement of

the counsel of the Respondent-Contemnor that he is not

in a position to deposit any amount.

15. After filing of the affidavit by the Respondent-Contemnor

and on perusal thereof this Court on 12.09.2024 found the

Contempt Petition (C) No. 712 of 2023 Page 8 of 19

Respondent-Contemnor, who was appearing through

video conferencing, of having committed wilful breach of

the directions contained in the Order dated 07.11.2022.

The Respondent-Contemnor was ordered to be heard on

the said charge as no amount had been paid by him and

was directed to be personally present in Court. The

Respondent-Contemnor subsequently appeared and an

opportunity was given to comply with the Order while

being heard on charge. Owing to his non -intention to

comply, the case was kept reserved for orders.

16. Stand of the Respondent-Contemnor in the affidavit which

has been filed is that the compliance of the Order dated

07.11.2022 passed by this Court is beyond his financial

and physical capabilities. It is thus, neither deliberate nor

an intentional non-compliance of the order and is only on

account of his penury. He has, thus, prayed for dropping

of the current contempt proceedings.

17. Counsel for the Petitioner Association, on the other hand,

has asserted that the conduct of the Respondent -

Contemnor from the very beginning was clearly indicative

of an attempt on the part of the Respondent-Contemnor to

hold on to the possession of the said Property. Despite the

Settlement Agreement, which has attained finality by

virtue of not being challenged, to retain the possession of

the said Property, Respondent-Contemnor has constantly

litigated across forums. Such an act on part of the

Respondent-Contemnor clearly showed that without

Contempt Petition (C) No. 712 of 2023 Page 9 of 19

making payment of the amount due to the petitioners, he

was reaping the fruits of the scheduled property in

violation of the terms of settlement.

18. Had it not been a viable preposition, the possession could

have been easily handed over by the Respondent -

Contemnor. Having taken benefit of the said Property,

Respondent-Contemnor cannot be now permitted to take

the plea of penury. Rather, it is an intentional non-

compliance of the directions issued by this Court even

after partial monetary benefit had been conferred upon

him vide Order dated 07.11.2022. Even till date no

payment whatsoever has been made which clearly reflects

the malafide of the Respondent-Contemnor. A reference is

also made to the Order dated 04.02.2022 when status quo

was ordered by this Court in relation to the property in

question to be maintained. Prayer has thus been made for

punishing the Respondent -Contemnor for having

committed contempt of this Court’s Order dated

07.11.2022.

19. Having considered the submissions made by the counsels

for the parties, we are of the considered view that the

Respondent-Contemnor has deliberately and with

malafide intention, not only mislead and misused the

process of the courts but has also intentionally violated

the order passed by this Court on 07.11.2022 by not

making the payment as directed therein.

Contempt Petition (C) No. 712 of 2023 Page 10 of 19

20. At the prospect of reiteration of the factual matrix, the

conduct of the Respondent -Contemnor since the

Settlement Agreement reflects his patent intent to retain

the said Property and this indicates that the business

proposition was not only a viable one but was yielding

profits. No person with a modest business acumen would

continue with a loss-causing endeavour. Respondent-

Contemnor has nowhere reflected the receipts from the

business being undertaken in the said Property.

21. Subsequently, he even sought time from the Execution

Court, but failed to comply, prompting an order for delivery

of possession of the said Property. This, he then challenged

through Revision Petition before the High Court of Kerala

and ultimately before this Court through the main

Petition.

22. It was on his insistence that this Court ordered status quo

vide Order dated 04.02.2022. However, he neither paid the

dues nor complied with the subsequent Order dated

07.11.2022 mandating payment of INR 12 lakhs per

month from 20.09.2021 and arrears in instalments.

23. The e-mail dated 17.11.2022, which was addressed to the

Petitioner Association by the Respondent -Contemnor,

seeking account details for the concerned amount to be

transferred, was responded accordingly by the Petitioner

Association vide e-mail dated 26.11.2022. Despite all this,

not even a rupee was credited to the account of the

Petitioner Association.

Contempt Petition (C) No. 712 of 2023 Page 11 of 19

24. Faced with this situation, Petitioner Association had no

option but to file the instant Petition before this Court

leading to issuance of notice on 24.02.2023 along with an

opportunity to the Respondent-Contemnor to remedy the

default. After various dates, the matter ultimately came for

hearing on 01.12.2023, when, owing to non-compliance of

Order dated 07.11.2022 for depositing money, the main

Petition was dismissed and the instant Petition survived.

25. It is only on 15.03.2024 that for the first time counsel for

the Respondent-Contemnor stated that he was not in a

position to deposit any amount, whereupon this Court

called for details of his immovable and movable assets and

that of his immediate family m embers, along with

necessary documents. Physical presence of the

Respondent-Contemnor was also ordered in Court on the

next date of hearing.

26. Respondent-Contemnor appeared through video

conference in Court on 12.07.2024 when the affidavit

which was filed by the respondent -contemnor was

considered. On perusal thereof, Court found the

Respondent-Contemnor having committed a wilful breach

of the directions contained in the order dated 07.11.2022.

He was, therefore, called upon to face the said charge and

with an intention to give him an opportunity of being

heard. The matter was listed for hearing with a direction

to the contemnor to personally remain present before the

Court. The contemnor was heard in person in Court and

Contempt Petition (C) No. 712 of 2023 Page 12 of 19

was again given an opportunity to comply with the order

of which he had committed contempt i.e. non-payment of

the amount and the arrears. The contemnor did not

express any remorse nor showed any intention to comply

with the order passed by this Court rather asserted that

he was not in a position to make any payment. It is in these

circumstances that the matter is being considered.

27. The e-mail dated 17.11.2022 intrinsically reflects financial

capability and liquidity at hands of the Respondent -

Contemnor. Had the Respondent-Contemnor been in dire

financial difficulty, the said communication would not

have come to the fore. Besides, had it been that the

Respondent-Contemnor was unable to comply with the

Order dated 07.11.2022 he should have moved this Court

for modification or withdrawal of the order.

28. All throughout, the Respondent-Contemnor had been in

possession of the said Property and had been utilising the

income generated from running of the said resort.

Acceptance on the part of the Respondent-Contemnor with

regard to the viability of the project is apparent from the

Order dated 07.11.2022 and his conduct. This would not

permit the Respondent-Contemnor to now turn around

and state that he is unable to make payment of not only

the monthly dues for use and occupation charges after

passing of the Order dated 07.11.2022 but also the arrears

as per which terms and conditions were fixed by this Court

in accordance with the prayer made by him. Non -

Contempt Petition (C) No. 712 of 2023 Page 13 of 19

fulfilment of the mandate and direction of this Court which

were at the request of the Respondent-Contemnor himself

reflects the intent on the part of the Respondent -

Contemnor to not to comply with the order rather to violate

with the same with impunity. The conduct clearly reflects

that the intention of the Respondent-Contemnor was to

gain the benefit by running the resort in the subject

property without paying the current liability, what to say

of the arrears.

29. Moreover, the amount which has been earned from the

resort being run by the Respondent-Contemnor has not

been accounted for. It can therefore easily be said that

there has been intentional and deliberate non-compliance

on the part of the Respondent-Contemnor of the order

passed by this Court, contempt of which stands

committed, but on getting an interim order of continuing

in possession usurped the earnings instead of paying off

the dues.

30. The malafide is therefore writ large and reflect the misuse

of the process of the Court. After seeking an order from

this Court where benefit has been conferred on the basis

of the submissions of the Respondent-Contemnor, not

complying therewith amounts to contempt of Court.

31. The power and jurisdiction of this Court to initiate and

punish for its contempt has not been disputed. It is well

settled by now and it is apparent from the provisions of the

Contempt of Court Act that Civil contempt means wilful

Contempt Petition (C) No. 712 of 2023 Page 14 of 19

disobedience of judgment, decree, or direction, order, writ

or other process of the Court or wilful breach of an

undertaking given to the Court.

32. Civil contempt, as is apparent from Section 2(b) of the

Contempt of Court Act 1971, means a wilful disobedience

of any judgment, direction or order passed by the Court.

All through, as has been detailed above, the intention on

the part of the Respondent-Contemnor was to use the

judicial proceedings for his advantage taking undue

benefit at the peril and cost of wrong assertions and

submissions put forth before the Court which would

amount to misleading the Court into believing the bonafide

at the hands of the Respondent-Contemnor. It would

amount to an attempt to exploit the procedural process of

Court to outreach and manoeuvre it resulting in abuse of

law and legal proceedings.

33. Any person who misuses the process of the Court with

ulterior motives cannot be said to be a person having

approached the Court with clean hands. A person who

tries to tarnish the process of litigation to the extent of

misguiding and misleading the proceedings before the

Court resulting in passing of order(s) which are to his

benefit at the cost of the loss of dignity, leading to

shrinkage of the faith of the common man in the judicial

process cannot be permitted.

Contempt Petition (C) No. 712 of 2023 Page 15 of 19

34. This Court, in Hira Lal Dixit v. State of Uttar Pradesh

1

in paras 9 and 10 held as follows:

“9. It should no doubt be constantly borne in mind that the

summary jurisdiction exercised by the superior courts

in punishing contempt of their authority exists for the

purpose of preventing interference with the course of

justice and for maintaining the authority of law as is

administered in the court and thereby affording

protection to public interest in the purity of the

administration of justice. This is certainly an

extraordinary power which must be sparingly

exercised but where the public interest demands it, the

court will not shrink from exercising it and imposing

punishment even by way of imprisonment, in cases

where a mere fine may not be adequate.

10. After anxious consideration we have come to the

conclusion that in all the circumstances of this case it

is a fit case where the power of the Court should be

exercised and that it is necessary to impose the

punishment of imprisonment. People must know that

they cannot with impunity hinder or obstruct or attempt

to hinder or obstruct the due course of administration

of justice.”

35. Further, in Bank of India v. Vijay Transport And

Others

2, this Court with reference to Section 2 & 12 of

Contempt of Courts Act, 1971 held that the jurisdiction so

conferred is to be exercised after having come to the

conclusion and satisfaction with regard to the commission

of contempt. This Court further went on to hold that the

said satisfaction can be derived by the Court with regard

to the commission of the contempt from the circumstances

of the case. The conduct of the party who/which is facing

the charge of contempt, not only after the issuance of the

1

(1954) 2 SCC 325

2

(2000) 8 SCC 512

Contempt Petition (C) No. 712 of 2023 Page 16 of 19

notice but prior thereto, could also be taken into

consideration.

36. A party, misguiding the Court to pass an order which was

never intended to be complied with, would constitute an

act of overawing the due process of law and, thus, commit

contempt of Court. In the instant case, the opportunity

having been availed, time having been sought and granted

by the Court further reflects the intent on the part of the

Respondent-Contemnor to discard and tarnish the judicial

process by polluting it. Disobedience of the order of the

Court in such circumstances would be the only result and

thus, civil contempt.

37. The pure stream of justice cannot be allowed to be polluted

at all. Reference at this stage needs to be made to the latest

decision of this Court in Sitaram Enterprises v.

Prithviraj Vardichand Jain

3 wherein in para 1 to 3 it has

been held as follows:-

“Disregarding a Court's order may seem bold, but the

shadows of its consequences are long and cold.”

1. Contempt of court is a serious legal infraction that

strikes at the very soul of justice and the sanctity of

legal proceedings. It goes beyond from mere defiance

of a Court's authority, but also denotes a profound

challenge to the principles that underpin the rule of

law. At its core, it is a profound disavowal of the

respect and adherence to the judicial process, posing a

concerning threat to integrity of judicial system. When

a party engages in contempt, it does more than simply

refusing to comply with a Court's order. By failing to

adhere to judicial directives, a contemnor not only

disrespects the specific order, but also directly

3

2024 SCC OnLine SC 2493

Contempt Petition (C) No. 712 of 2023 Page 17 of 19

questions the Court's ability to uphold the rule of law.

It erodes the public confidence in the judicial system

and it's ability to deliver justice impartially and

effectively. Therefore, power to punish for Contempt of

Court's order is vital to safeguard the authority and

efficiency of the judicial system. By addressing and

penalizing contemptuous conduct, the legal system

reinforces its own legitimacy and ensures that judicial

orders and proceedings are taken seriously. This

deterrent effect helps to maintain the rule of law and

reinforces public's faith in the judicial process,

ensuring that Courts can function effectively without

undue interference or disrespect.

2. Contempt powers are integral to maintaining the

sanctity of judicial proceedings. The ability to address

contempt ensures that the authority of the court is

respected and that the administration of justice is not

hampered by willful disobedience. In the said context,

the power of this Court to punish for contempt is a

cornerstone of its authority, integral to the

administration of justice and the maintenance of its

own dignity. Enshrined in Article 129 of the

Constitution of India, this power is essential for

upholding the rule of law and ensuring due compliance

by addressing actions that undermine its authority,

obstruct its proceedings, or diminish the public trust

and confidence in the judicial system.

3. The Courts ordinarily take lenient approach in a case

of some delay in compliance of the orders, unless the

same is deliberate and willful, on confronting the

conduct of the contemnor that strikes the very heart of

judicial authority. Undoubtedly, this appalling breach

of legal decorum has in its face challenged the sanctity

of the orders passed by this Court and hence we are

constrained to examine Contemnor/tenant's willful

and deliberate act of non-compliance of the order and

also the undertaking furnished by him as directed.”

38. The above principles and the observations, as made by this

Court, would fully apply to the case at hand where, from

the very beginning till the very end the Respondent-

Contemnor has been taking the Court for a ride. The

misuse of the process of Court with an intent to tarnish

Contempt Petition (C) No. 712 of 2023 Page 18 of 19

the image of judiciary, threatening the integrity, and the

efficiency of the judicial system cannot be allowed to be

overlooked and ignored in the garb of non-fulfilment of the

directions because of now said to be faced financial

constraints.

39. The Respondent-Contemnor cannot be allowed to go scot

free after having taken this Court at a stage where his

conduct leaves this Court with no option but to take strict

action and to punish him for the contempt committed by

him, i.e., non-compliance of the directions issued by this

Court vide Order dated 07.11.2022.

40. This case, in our opinion, would not be one where mere

imposition of fine would suffice. In the given facts and

circumstances of the present case, we are convinced that

the Respondent-Contemnor is liable to be punished for the

contumacious conduct.

41. We, in the above facts and circumstances , hold Shaji

Augustine-Respondent, guilty of Civil Contempt and

impose punishment of Simple Imprisonment for three

months along with fine of INR 20,000/- to be deposited in

two weeks, and in case of default, further Simple

Imprisonment for one month.

42. Giving one more opportunity to the Respondent-

Contemnor to purge the contempt, 30 days time is granted

to him to comply with the Order dated 07.11.2022 and

submit compliance report to the Registrar Judicial of this

Contempt Petition (C) No. 712 of 2023 Page 19 of 19

Court a week thereafter. The punishment, as aforesaid,

would come into effect in case the directions as contained

in the Order dated 07.11.2022 are not complied with,

within 30 days of the pronouncement of this judgment.

The contempt proceedings are disposed of.

43. Pending application(s), if any, also stand disposed of.

……...……….……………………..J.

[ ABHAY S. OKA ]

.……..………..……………………..J.

[ AUGUSTINE GEORGE MASIH ]

NEW DELHI;

APRIL 24, 2025