Full Text
HIGH COURT OF DELHI
CHARANJEET KAUR KHURANA .....Plaintiff Represented by: Mr. Rajat Aneja & Ms. Chandrika Gupta, Advocates.
Represented by: Mr. A.K. Matta, Sr. Advocate with Mr. Anirban Bhattacharya, Mr. Karan Gaur & Mr. Rajeev Chowdhary, Advocates for
D-1.
Mr. Mansimran Singh, Advocate for D-4.
Ms. Manpreet Kaur, Advocate for D-5.
J U D G E M E N T
NEENA BANSAL KRISHNA, J. I.A.4329/2019 (U/O XXXIX Rule 2A r/w Section 151of CPC, 1908)
JUDGMENT
1. The present application under Order XXXIX Rule 2A read with Section 151of the Code of Civil Procedure, 1908 (hereinafter referred to as “CPC, 1908”) has been filed on behalf of the plaintiff for initiating appropriate proceedings for willful and contumacious disobedience of the Orders of Injunction dated 01st November, 2013 and 12th October, 2017 granted by this Court against the defendants.
2. It is submitted in the application that the present Suit has been filed by the plaintiff against the defendant Nos. 1 to 6, all of whom are the surviving siblings of the plaintiff or the legal representatives of the deceased siblings. The matter was heard for the first time on 01st November, 2013 and after hearing the plaintiff and going through the pleadings, an ex parte interim injunction was granted in favour of the plaintiff and the parties were directed to maintain the status quo in respect of the properties, namely, (i) B-11, Jangpura Extension, New Delhi and (ii) C-46, Okhla Industrial Area, Phase-II, New Delhi.
3. The defendant No. 1 contested the Suit by claiming that the deceased father of the parties had left a Will dated 17th October, 1977. The immoveable properties purchased after the demise of the deceased father was with the exclusive income of the defendant No. 1, though he did not dispute that his sole source of income was from the Partnership Firm, M/s. Jupiter Radios. However, he claimed himself to be sole proprietor of the said Partnership Firm in view of the other partners (3 brothers of the deceased Shri Patwant Singh Oberoi) having retired from the Partnership Firm from time to time.
4. On 12th October, 2017, the Court while hearing the pending applications, including one Application under Order XXXIX Rules 1 and 2 of CPC, 1908 of the defendant No. 1 gave an Undertaking that he shall not sell or transfer the title of immoveable property bearing No. C-45, Okhla Industrial Area, Phase-II, New Delhi without prior permission of this Court. The Injunction Order with respect to three out of the four properties which are the subject matter of the present Suit, was thus granted.
5. During the pendency of the present Suit, an Application bearing No. I.A. 12554/2018 was filed on behalf of the defendant No. 1 under Order VIII Rule 1A of CPC, 1908 seeking exemption from filing the originals of the documents and for conducting the admissions/denial of the documents on production of the original documents. During this application, the plaintiff came to know that the defendant No. 1 has allegedly mortgaged two properties bearing No. C-45 and C-46, Okhla Industrial Area, New Delhi with a Financial Institution, namely, India Bulls Housing Finance Limited i.e., the respondent No. 2 herein. It is claimed that from the averments made by the defendant No. 1 himself in his application, it is clear that he has played a fraud by mortgaging the original title deeds of the two properties which are now with the financial institution, India Bulls Housing Finance Limited. The defendant No. 1 has deliberately not mentioned the date, month and year of the alleged mortgage of the properties and had failed to disclose this fact for the last five years since when the Suit is pending.
6. The plaintiff in his Reply to the application of the defendant No. 1 had sought the production of the mortgaged deeds. However, the defendant NO. 1 has continued to be reticent and has deliberately failed to give the details by way of rejoinder. However, the Application bearing No. I.A. 12554/2018 of the defendant No. 1 seeking exemption from producing the original documents was allowed by the Joint Registrar vide Order dated 05th December, 2018, subject to costs of Rs. 15,000/- which has not been paid till date. The defendant No. 1, therefore, cannot claim any concession from placing the original documents, since he has failed to deposit the costs.
7. A fresh application has been filed by the plaintiff under Order XI Rules 12 and 14 of CPC, 1908 seeking directions to the defendant No. 1 to produce the mortgaged documents and the Statement of Account pertaining to both the mortgaged transactions. Apparently, after being served with the copy of the application, the defendant No. 1 filed the Application under Section 151 of CPC, 1908 vide Diary No. 123319 purportedly on the same date and opposed the application of the plaintiff and sought to voluntarily disclose the particulars of the two mortgaged transactions. Certain documents were annexed along with the application. The defendant No. 1 disclosed that the mortgage in respect of the properties had been created in the year 2016 and loan for the purpose of business in the sum of Rs. 7,61,50,000/- was taken against the said two properties vide Loan Letter dated 14th June, 2016. It is claimed that the loan has been taken by the defendant No. 1 as well as his wife despite being aware of the existence of the Injunction Orders granted by this Court. The defendant No. 1 has further disclosed through his Application bearing No. I.A. 2486/2019 that on 31st October, 2018 negotiated with the Federal Bank and transferred his earlier loan with India Bulls Housing Finance Limited to Federal Bank by availing an enhanced sanction from the Federal Bank vide Letter dated 31st October, 2018, whereby the loan to the tune of Rs. 8,30,00,000/- was granted by the Federal Bank against the said two properties.
8. It is submitted that despite Injunction Orders, the defendant No. 1 has mortgaged the two properties and has flouted the Injunction Orders with impunity and such conduct is willful and contumacious disobedience calling for strict punitive action against the defendant No. 1 for not only defrauding but also breach of Injunction Orders for a period of three years since 2016 and also depriving the plaintiff as well as other defendants of the two precious immoveable properties by subjecting them to the stringent provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as “SARFAESI Act, 2002”) which entitles the Banks/Financial Institutions to sell the mortgaged properties without the intervention of the court.
9. It is asserted that the Officials of the India Bulls Housing Finance Limited as well as the Federal Bank Limited are also in collusion and connivance with the defendant No. 1 in squandering public money by mortgaging the said two properties despite the Injunction Orders granted by this Court. The Bank Manager, including other senior officials who sanctioned the loan are also liable for disobedience of the Injunction Orders dated 01st October, 2017. They have also been impleaded as a necessary party to the present application.
10. Therefore, a prayer has been made that appropriate proceedings be initiated against the defendant Nos. 1 and 4 for willful and contumacious disobedience of the Injunction Orders dated 01st October, 2017 granted by this Court.
11. Learned counsel on behalf of the plaintiff has relied upon the judgements, namely, Shyam Sahni vs. Arjun Prakash & Ors. (2020) 16 SCC 788, N. Srinivas and Ors. Vs. Naresh Kumar and Ors. MANU/TN/0004/2011, & Krishna Gupta vs. Narendra Nath & Ors. MANU/DE/3135/2017.
12. The defendant No. 1 in his Reply has asserted that by way of a reasonable interpretation of the Order dated 01st November, 2013, it is evident that it does not create any fetter from mortgaging the suit property. Likewise, no Injunction Order creating any fetter had been passed vide Order dated 12th October, 2017, but only a limited Undertakinghad been given. In the absence of an Injunction Order, the question of disobedience and resultant contempt under Order XXXIX Rule 2A of CPC, 1908 does not arise.
13. It is claimed that the mortgage involves transfer of an interest in land as security for a Loan or other obligation. It is the most common method of financing real estate transactions. The Mortgagor is the party transferring the interest in land while a Mortgagee, usually a Financial Institution, is the provider of the loan or other interest in exchange for the security interest in land. Failure to make payments results in the foreclosure which allows the Mortgagee to declare the entire mortgage debt as due and to be paid immediately. On failure to pay the mortgage debt after foreclosure, leads to seizure of security interest in land and its sale to pay the remaining mortgage debt. The foreclosure process depends on the State law and the terms of mortgage.
14. It is claimed that three theories exist regarding who has the legal title to the mortgaged property. Under the Title Theory, title to the security interest rests with the Mortgagee. As per the Lien Theory, the legal title remains with the Mortgagor unless there is a foreclosure. The Intermediate Theory applies the Lien Theory unless there is a default on the mortgage whereupon the Title Theory applies. In India, it is the lien theory which is followed and the legal title remains with the Mortgagor unless there is a foreclosure. There is no legal transfer of title between the two parties, but only the Mortgagor surrenders the Title deeds to the custody of Mortgagee at the time of mortgaging the property. Such transaction by itself is not subject to registration or stamp duty. Resultantly, although the Mortgagor might hold the legal title, the Mortgagee keeps the title documents.
15. While the defendant No. 1, on the reasonable interpretation of the directions contained in the Order dated 01st November, 2013, believed it was only an alienation of title which had been restrained and, therefore, being confronted with certain financial crisis requiring money, for which reason, he mortgaged the property.
16. In so far as the Injunction Order dated 12th October, 2017 is concerned, it is asserted that there was no Injunction Order operating in respect of the property bearing No. C-45, Okhla Industrial Area, Phase-II New Delhi and in the absence of any Injunction Order, the question of disobedience under Order XXXIX Rule 2A does not arise.
17. The Undertaking given by the defendant No. 1 to the Court on 12th October, 2017 not to sell or transfer the title of the property bearing No. C-45, Okhla Industrial Area, Phase-II, New Delhi without permission of the Court was only till the next date of hearing i.e., 15th January, 2018 on which date, it was not continued further.
18. Section 2(b) of the Contempt of Courts Act, 1971 provides for two categories of cases, namely, (i) willful disobedience of the process of Court and (ii) willful breach of an Undertaking given to the Court. First category is separate from the second category and the legislative intention was to clearly draw the distinction between the two and thus created two distinct classes of contumacious behaviour. Order XXXIX Rule 2A of CPC, 1908 on the other hand confines itself to disobedience of an Injunction Order alone and not breach of any Undertaking.
19. It is thus asserted that there is no contempt committed by the defendant No. 1. However, if the Court comes to the conclusion that the contempt has been committed, then the defendant No. 1 offers his unconditional apology and assures that he had no intent of willful disobedience of the Injunction Orders granted by this Court. It is also submitted that the requisite information has been divulged by the defendant No. 1 himself and has not shied away from placing the mortgage documents on record.
20. On merits, all the averments made are denied.
21. It is submitted that the present application is mala fide and may be dismissed.
22. The defendant No. 4-Federal Bank in its Reply has asserted that the role of the Federal Bank is limited and it is not a necessary and proper party to the present contempt proceedings. It had no knowledge nor had any communication of the Injunction Order dated 01st November, 2013 at the time of sanctioning the Loan on 31st October, 2018. Therefore, the Federal Bank unnecessarily is being dragged into this controversy and the proceedings vis-à-vis, the defendant No. 4 is liable to be dismissed.
23. The plaintiff by way of his separate Rejoinder to reply has reaffirmed his averments as contained in the present application.
24. Submissions heard.
25. The plaintiff had filed the Suit for Partition, Possession, Rendition of Accounts and Permanent Injunction for Declaration that the plaintiff was entitled to 1/7th share in all the properties which were the subject matter of the Suit and also for Permanent Injunction to restrain the defendants from transferring, alienating, parting with the possession or creating any third-party interest in the subject properties.
26. On the first date of appearance, the Court made the Order dated 01st November, 2013 which reads as under: ““O R D E R 01.11.2013 IA No.17646/2013 Exemption allowed, subject to just exceptions. Application is allowed. Plaint be registered as Suit. Issue Summons to the defendant by Ordinary Process and Speed Post, returnable on 21st January, 2014. IA No.17644-17645/2013 Issue notice to the defendant by Ordinary Process and Speed Post, returnable on the date fixed above. IA No.17643/2013 (O.39 R.[1] and 2 CPC) Issue notice to the defendant by Ordinary Process and Speed Post, returnable on the date fixed above. This is an application under Order 39 Rule 1 and 2 CPC seeking ex parte ad interim injunction. It is the contention of the plaintiff in the accompanying plaint that late Shri S.Patwant Singh Oberoi was the father of the plaintiff and defendants No.1 to 5 and grand father of defendants No.6(i) to (iv). Late Shri S.Patwant Singh Oberoi owned moveable and immovable properties and that he expired on 22.01.1978. It is further averred that the plaintiff and defendant No.1 to 6 each are entitled to 1/7th share of the assets of late Shri S.Patwant Singh Oberoi. The details of the assets allegedly left behind by late Shri S.Patwant Singh Oberoi are stated in schedule A and B filed with the plaint. It is further averred that grandfather of the parties late S.Mela Singh Oberoi died in 2003 and that prior to his death under his guidance the family members were living in harmony. It is further averred that now after the death of S.Mela Singh the grandfather, defendant No.1 is trying to usurp the assets of the father late Shri S.Patwant Singh Oberoi. Though a claim is made on various movable and immovable properties the plaintiff has placed on record photocopy of a registered sale deed dated 11.2.1970 pertaining to property No.B/11, Jungpura Extension, New Delhi in the name of Shri S.Patwant Singh Oberoi and a photocopy of the Registered lease dated 20.1.1975 executed in favour of Jupiter Radios regarding plot No.C-46, Okhla Industrial Area, Phase II, New Delhi. Reliance is placed on partnership deed dated 1.4.1968 a photocopy of which is placed on record to show that late Shri S.Patwant Singh Oberoi was one of the partners of the firm Jupiter Radios. It is submitted that assets of the firm have now been usurped by defendant No.1. In my view, the plaintiff has made out a prima facie case in her favour. Balance of convenience is also in favour of the plaintiff. In case an ad interim ex parte injunction is not granted in favour of the plaintiff it will cause irreparable harm and injury to the plaintiff. The parties to the suit are directed to maintain status quo regarding title of the property B/11, Jungpura Extension, New Delhi and C-46, Okhla Industrial Area, New Delhi till further orders. On account of Court holidays plaintiff to comply with provisions of Order XXXIX Rule 3 CPC within a period of five days from today.”
27. By way of Order dated 01st November, 2013, the Court directed the parties to maintain the status quo regarding the title of the property bearing Nos. B/11, Jungpura Extension, New Delhi and C-46, Okhla Industrial Area, Phase-II, New Delhi till further orders.
28. The plaintiff claimed in his application that the blatant violation of the Injunction Order granted against the defendant No. 1 vide Order dated 01st November, 2013.
29. It is not in dispute that the defendant No. 1-Sardar Manmohan Singh Oberoi executed a Mortgage Deed in respect of the Property No. C-46, Okhla Industrial Area, New Delhi with India Bulls Housing Limited.
30. The defendant No.1 has mortgaged the property to the India Bulls Housing Limited for getting a loan for the business purposes in the sum of Rs. 7,61,50,000/- vide Loan Application bearing No. HLAPLAJ00277299 dated 14th June, 2016 in the name of M/s. Jupiter Radios. The Sanction Letter pertaining to this loan is vide Application bearing No. HLAPLAJ00380467 in the sum of Rs. 7,50,00,000/- dated 30th October, 2017 which was the actual loan amount that was disbursed vide this sanction letter. The property bearing No. C-45, Okhla Industrial Area, Phase-II, New Delhi was given in lien.
31. The question which comes for consideration is whether the mortgage of the property for securing a loan by the defendant No. 1 would amount to breach of injunction granted by this Court vide Order dated 01st November,
2013.
32. Section 58 of the Transfer of Property Act defines “mortgage”, “mortgagor”, “mortgage-money” and “mortgage-deed”. Clause (f) of Section 58 provides for creation of mortgage by deposit of title deeds. The requisites of an equitable are, namely, (i) debt; (ii) deposit of title deed; and
(iii) an intention that the deed shall be security for the debt.
33. The Hon’ble Supreme Court in Bank of India vs. Abhay D. Narottam and Others (2005) 11 SCC 520 was confronted with similar facts where a mortgage had been created in a case wherein a Consent Decree was passed for recovery of Rs. 12,44,59,207/- as principal together with interest thereon and an Undertaking had been given by the respondent not to create a mortgage in respect of his property. It was held that mortgage has been defined under Section 58(a) of the Transfer of Property Act, 1882 as a transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be advanced by way of loan etc. Without a “transfer of interest” there is no question of there being a mortgage. The same principle would apply to a charge created under Section 100 of the Transfer of Property Act, 1882, which provides that all the provisions which apply to a simple mortgage shall, so far as may be, apply to such charge. The definition of simple mortgage in Section 58(b) of the Act merely speaks of the procedure and describes that species of mortgage. The Apex Court further held that a mere Undertaking to create a mortgage is not sufficient to create “any interest” in any immoveable property.
34. In Sita Ram Prasad vs. Mahadeo Rai & Ors (1980) SCC OnLine Pat 29, the Patna High Court held that a mortgage created in terms of the Section 58 of the Transfer of Property Act does not amount to transfer of property itself as “the title” in the mortgaged property certainly remains with the mortgagors. It was further observed that there is no manner of doubt that the parties (who have mortgaged the property) were competent in law to deal with the mortgaged land at the time of oral partition like any other joint family property and the allotment of the said land to the share of any coparceners lawfully make the allottee entitled to redeem the mortgage as a whole and, thereafter, to become absolute owner of the said property. It was thus concluded that even though a mortgage is created, all right, title and interest of the owners in the mortgaged land would be subject to the encumbrances so created in the property.
35. In Syndicate Bank vs. Estate Officer & Manager, APIIC Ltd. (2007) 8 SCC 361, the Hon’ble Supreme Court observed that the principal question which arose for consideration was whether in absence of any execution and registration of deed of sale, can any interest in the land be created. It was held that Section 58 of the Transfer of Property Act provides for creation of mortgage by depositing title deed, but it is not necessary that the mortgagor would have forfeited is complete title over the property. Furthermore, the complete title over a property can be acquired by a vendee only when the Deed of Sale is executed and registered by the vendor in terms of Section 54 of the Transfer of Property Act.
36. In Syndicate Bank (supra), the Hon’ble Supreme Court further observed that the essence of the whole transaction of equitable mortgage by deposit of Title Deeds is the intention that the Title Deed shall be the security for the debt. Mortgage by deposit of title is one of the forms of mortgages, wherein there is a transfer of interest in specific immoveable property for the purpose of securing payment. However, in the absence of registered Deed of Sale, the title to the land does not pass and what would not be conveyed is the Title of the estate, though the possession may be transferred.
37. In the present case, it is undisputed that the stay which was granted was a restraint against “creating a title” in the suit property i.e., C-46, Okhla Industrial Area, Phase-II, New Delhi. The defendant No. 1 has admittedly created a mortgage in respect of this property in the year 2016 by mortgaging the documents of the property to India Bulls Housing Limited for securing a loan. While securing the loan, the property documents of the Property No. C-45, Okhla Industrial Area, Phase-II, New Delhi were also deposited. As discussed above, mere creation of mortgage may encumber the property, but it does not amount to transfer of title in the suit property. Therefore, by mere creation of mortgage in the year 2016, it cannot be said that the defendant No. 1 has created a title in the property bearing No. C-46, Okhla Industrial Area, Phase-II, New Delhi by mortgaging the same.
38. In so far as the Property No. C-45, Okhla Industrial Area, Phase-II, New Delhi is concerned, there was no injunction granted vide Order dated 01st November, 2013 in respect of this property. Therefore, any deposit of the title documents while creating a mortgage by depositing the title documents of Property No. C-46, Okhla Industrial Area, Phase-II, New Delhi, cannot be said to be in violation of Order of this Court dated 01st November, 2013.
39. The other aspect is that an Undertaking was given on behalf of the defendant No. 1 in the Court on 12th October, 2017 that no sale of Property bearing No. C-45 Okhla Industrial Area, Phase-II, New Delhi shall be undertaken till the next date i.e., 15th January, 2018.
40. In order to appreciate the contentions of the rival parties, it is pertinent to reproduce the Order dated 12th October, 2017 which reads as under: O R D E R 12.10.2017 Both the parties are directed to file short written submissions with regard to pending applications within two weeks. List for hearing and disposal of the pending applications on 15th Mr. Dinesh Garg, learned counsel for the defendant NO. 1 without prejudice to the rights and contentions of his client states that till the next date of hearing the defendant no. 1 shall not sell or transfer the title of the property no. C-45, Okhla Industrial Area, Phase-II, New Delhi without prior permission of this Court.”
41. Again, it was an Undertaking given by the defendant No. 1 against the sale of C-45 Okhla Industrial Area, Phase-II, New Delhi and that too till next date i.e., 15th
42. It is not in dispute that the defendant No. 1 had taken a top-up loan on 30th October, 2017 from India Bulls Housing Limited in the sum of Rs. 7,50,00,000/- against the Property No. C-46, Okhla Industrial Area, Phase- II, New Delhi and documents in respect of the Property No. C-45, Okhla Industrial Area, Phase-II, New Delhi were also submitted. This transaction took place after the Order dated 12th October, 2017.
43. The question is whether the deposit of title documents of C-45, Okhla Industrial Area, Phase-II, New Delhi would amount to breach of the Undertaking. Again, as already noted, the Undertaking was in respect of sale of property and mere deposit of title documents of Property No. C-45, Okhla Industrial Area, Phase-II, New Delhi would not be in violation of the Undertaking.
44. Thereafter, the defendant No. 1 had closed his account from India Bulls Housing Limited and transferred it to the Federal Bank of India on 31st October, 2018, wherein a loan in the sum of Rs. 8,30,00,000/- was sanctioned with the Property No. C-46, Okhla Industrial Area, New Delhi having been given as a collateral security and the negative lien on Property No. C-45, Okhla Industrial Area, Phase-II, New Delhi was created.
45. Admittedly, there was no transfer of the title of any of the Properties, namely, C-45 and C-46, Okhla Industrial Area, Phase-II, New Delhi at any time by the defendant No. 1 in violation of the interim orders granted by this Court. As already mentioned above, creation of a negative lien in respect of this property in the year 2018 would not tantamount to violation of the orders of any Court.
46. Learned counsel on behalf of the plaintiff has relied upon on the decision of High Court of Madras in N. Srinivas and Ors. Vs. Naresh Kumar and Ors. MANU/TN/0004/2011, wherein the suit had been filed by the plaintiffs for declaration that they were the owners of the property and for injuncting the defendants. The parties had been directed to maintain the status quo in respect of the properties in violation of which the respondents mortgaged the property by deposit of title deeds with the respondent Bank. It was held that such creation of interest by way of mortgage despite the status quo orders amounted to contempt. It was explained that the status quo was a blanket status quo injuncting the respondents which implies that the respondents had been restrained from changing the status of the properties in any manner.
47. In N. Srinivas (supra), the Court had found that the respondent had created equitable mortgage in respect of the suit property despite the injunction by the Court restraining the defendant from selling, alienating or creating any third-party rights in the property which was confirmed and the parties were directed to maintain status quo with respect to the suit property.
48. The facts involved in the case of N. Srinivas (supra) are totally distinguishable. The plaintiff therein was claiming to be absolute owners of the property by challenging the Sale Deeds executed in favour of the defendants and also a blanket status quo in respect of the suit property had been granted. However, in the present case, the suit is for partition and other reliefs, whereby the plaintiff has claimed 1/7th share and asserting the defendant No. 1 to be having 1/7th share in the suit properties. It is a suit for partition wherein according to the plaintiff himself, the defendant No. 1 is entitled to 1/7th share in the properties and the title of the defendant No. 1 to the extent of 1/7th share was, therefore, admitted. In this context, it can be understood that the status quo that was granted was only in respect of “creating the title in the suit properties” and not a blanket status quo as was granted in the case of N. Srinivas (supra). This judgement is, therefore, distinguishable and not applicable to the facts in hand.
49. In Shyam Sahni vs. Arjun Prakash & Ors. (2020) 16 SCC 788, the Civil Suit for Declaration, Permanent Injunction and Partition was filed by the appellant, Shyam Sahni against the defendants who were the family members. An Interim Injunction was granted vide Order dated 02nd June, 2008 restraining the defendants from selling, alienating or creating third-party rights in the suit property. The defendants took a plea that the equitable mortgage had been created in first week of October 2007 which was prior to the grant of ex parte order. However, the appellant claimed disobedience of the Injunction Order and moved an Application under Order XXXIX Rule 2A of CPC, 1908 read with the Contempt of Courts Act, 1971 for contempt of the orders of the Court. During the pendency of the Contempt Petition, the order of Interim Injunction was confirmed and the parties were directed to maintain the status quo with respect of the suit property. The defendant No. 1 was held guilty of breach and was directed to clear the charge within four months from his own funds and resources. Accordingly, an Undertaking was given by the defendants.
50. In Shyam Sahni (supra), the learned Single Judge of this Court directed the passport of the defendant No. 1 to be deposited in the Court to ensure the presence of the defendants. The Division Bench of this Court upheld the Order which was taken to the Hon’ble Supreme Court, wherein the challenge was only in respect of the directions for deposit of the passport. The Hon’ble Apex Court observed that there was no direction for impounding of the passport, but only for deposit in order to ensure presence of the defendant No. 1.
51. Again in this case, it was during the pendency of the contempt petition, an Undertaking was given by the defendant No.1 to clear up all the dues after the final disposal of the Contempt Petition. However, despite repeated undertakings, the defendant No. 1 failed to do so. The defendant No. 1 also avoided his appearance in the Court in order to secure his presence. The issue involved was only to secure the presence of the Contemnors who had been avoiding appearance by directing them to deposit their passports. The issue in was not whether there was a breach of an Undertaking given in the Court but was essentially in respect of seeking appearance of the Contemnors who had been held guilty of Contempt of Courts Act, 1971.
52. The basic contention of the plaintiff was that by creating a third-party interest by way of mortgaging the property to a bank, the defendant No. 1 has made the property susceptible to action under the SARFAESI Act, 2002 which may prejudice the rights of the plaintiff. In so far as this argument is concerned, it may not be fully tenable since the defendant No. 1 may create an interest in respect of the property of which he is the owner. Once it is admitted that he has a share, the property can be encumbered to him only to the extent is 1/7th share. Moreover, it has been stated by the defendant No. 1 that till date there is no default in payment of loan which is being regularly paid. The plaintiff may be justified having an anxiety on account of mortgage created in respect of the one of the properties and a negative lien in respect of another property but it cannot be said in the given facts and circumstances that there is any breach of direction/injunction granted by this Court.
53. Therefore, the present application for contempt under Order XXXIX Rule 2A of CPC, 1908 is hereby dismissed in the above terms. CS(OS) 2126/2013, I.As.17644/2013, 25231/2015, 4330/2019, 4081/2021 List before the Joint Registrar for completion of pleadings on 23rd January, 2023.
JUDGE NOVEMBER 21, 2022 S.Sharma