Case: Baranagore Jute Factory Plc. Mazdoor Sangh (Bms) Etc Vs. Baranagore Jute Factory Plc. Etc

compensation and to keep the same in fixed deposit subject to further orders of the court". The Official Liquidator was of the view that ... "the money should be deposited with the Registrar, Original Side".19. After considering the submissions of the learned Counsel appearing for the parties, the learned Single Judge, formed the opinion that ... "the submission made on behalf of the Official Liquidator is also in conformity with the submission made by Mr. S.N. Mitra, who has largest support of the parties before me (the court)". Hence, the learned Single Judge made it clear that "In that view of the matter, the National Highway Authority was restrained from making any payment on account of compensation to the company in liquidation except by way of an account payee cheque to the Registrar, Original Side of the High Court". Therefore, it is fairly clear that the court had in mind the entire compensation paid by the NHAI in respect of the land acquired by them. Since the NHAI was bound to deduct TDS, an amount of Rs. 10,55,60,331/- was paid to the Income-Tax Department. There can be no doubt whatsoever that the said amount formed part of the compensation. What the court in its order dated 23.02.2011 was requested and the court intended too was to protect the compensation amount. Merely because it goes through the Income-Tax Department, the same does not cease to be part of compensation. Even the respondents herein had submitted before the court at the time of passing the order dated 23.02.2011 that the compensation amount needed to be protected and they were willing to protect it subject to the order of the court. Therefore, the respondents, while handling of the compensation amount, had to seek orders from the court; going by the way they understood the proceedings.20. In that background of the case, we are of the view that the respondents should not have appropriated the refund they received from the Income-Tax Department. There is nothing wrong in claiming the refund. The problem is in utilising the refund received. The refund they received is actually the compensation in respect of the land acquired from the company and it is that amount which the court wanted to protect by its order dated 23.02.2011. Hence, prima facie, we are of the view that the appropriation made by the respondents of the refund amount they received from the Income-Tax Department was in violation of the order dated 23.02.2011. It appears, for that reason only, even the Division Bench declined to disturb the Rule in the contempt proceedings issued against respondents. However, the Division Bench is wholly wrong in entering a finding that there is no violation of the order dated 23.02.2011 in utilising the refund. No doubt, had the refund and subsequent appropriation been of any amount other than the compensation, there would not have been any contempt at all.21. Unfortunately, the Division Bench, in the impugned order, failed to recapitulate the background of the order dated 23.02.2011 and its own earlier orders with regard to the refusal for withdrawal by the respondents of the compensation deposited in court. Even if there be pressing needs, there could not have been any utilisation of the compensation amount without leave of the court. We find that the Division Bench has taken note of the expenditure made by the respondents of the amount they received. To quote the relevant background:"We have also looked into the details of utilisation of the refund as given in the schedule being Annexure L to the stay application filed before us, wherefrom it appears that Rs. 1,19,18,723/- was paid towards arrear electricity charges by three account payee cheques drawn on Axis Bank Ltd., particulars whereof have been given in the schedule. Another Rs. 2,23,00,000/- has been kept in fixed deposit as lien for issuance of bank guarantee favouring CESC Ltd., against the security deposit to be paid to CESC Ltd., for continuation of supply of electricity. This payment has been made by cheque dated 28th June, 2014 and also by transfer from Syndicate Bank on 28th June, 2014. A sum of Rs. 24,92,582/- has been paid towards arrear Central Sales Tax [Partial Payment]; Rs. 34,56,910/- towards Employees State Insurance contribution; Rs. 44,44,044/- towards Provident Fund contribution; Rs. 66,00,000/- towards arrear dues of Jute Corporation, a government body and Rs. 4,68,85,198/- towards arrear wages, arrear ex gratia payment, arrear gratuity and other arrear dues of the workmen."22. It is also seen from the order that the Division Bench had taken note of the paltry balance in the accounts of the company as on 27.06.2015. To quote:"We directed the company to furnish us with details of its bank operations. It appears that the company has about twelve bank accounts in operation in India and the combined balance in all these accounts taken together as on 27th June, 2015 was Rs. 13,96,188.79P. Our attention has been drawn by Mr. Mookherjee to the fact that there are three other bank accounts with combined balance of not more than Rs. 3,44,436/- which have not been used for over seven years and the company also has a bank account outside India that has a balance of 936 pounds [less than Rs. 1,00,000/- in value in Indian currency]."23. It may be seen that the respondents have been managing the affairs of the company for a few years despite the futile attempts made by them to withdraw the compensation lying in deposit in court.24. As held by this Court in Delhi Development Authority v. Skipper Construction Co. (P) Ltd. and another, (1996) 4 SCC 622 , and going a step further, the Court has a duty to issue appropriate directions for remedying or rectifying the things done in violation of the orders. In that regard, the Court may even take restitutive measures at any stage of the proceedings.25. In the background as above of the case, the Division Bench should not have interfered with the order dated 26.06.2015 passed by the learned Single Judge.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]6. It may specifically be noted that the Division Bench has not interfered with the Rule issued to the respondents in the proceedings initiated under The Contempt of Courts Act, 1971 (hereinafter referred to as the Act) for the alleged violation of the order dated 23.02.2011. The Division Bench only vacated the order regarding operation of the bank accounts of the company without securing the amount of rupees ten crores and odd.12. Thus, it may be noted that this Court declined to interfere with the order passed by the Division Bench of the High Court, which in turn refused the prayer for withdrawal of the deposit lying with the Court.As we have already clarified, the Division Bench, in the impugned order, has not interfered with the Rule issued in the contempt proceedings. The interference is only to the extent of direction to secure the TDS amount Rs. 10,55,60,331/-.Though Shri Shyam Divan, learned Senior Counsel invited our attention to the judgment of this Court in Sudhir Vasudeva, Chairman and Managing Director, Oil and Natural Gas Corporation Limited and others v. M. George Ravishekaran and others, (2014) 3 SCC 373 , and contended that the courts must not travel beyond the four corners of the order which is alleged to have been flouted,in the background which we have explained above, we find it difficult to appreciate the submission. This Court, in the judgment referred to above, in paragraph-19, has clarified that the directions which are explicit in the judgment or "are plainly self-evident" can be taken into account for the purpose of consideration as to whether there has been any disobedience or wilful violation of the same. Prima facie, we are of the view that learned Single Judge has taken note only of the plainly self-evident facts while issuing the Rule and order regarding securing the amounts which the respondents received by way of refund from the Income-Tax Department and utilized.18. It may be seen that the order dated 23.02.2011 regarding the deposit in court was passed to secure the entire compensation from the NHAI. The court was concerned about the money to be received from the NHAI towards the compensation and appropriately protecting the same from being used by the company. Even the respondents herein had "... no objection to money being protected...". The court had, in fact, declined the request made by the respondents ... "to receive the compensation and to keep the same in fixed deposit subject to further orders of the court". The Official Liquidator was of the view that ... "the money should be deposited with the Registrar, Original Side".19. After considering the submissions of the learned Counsel appearing for the parties, the learned Single Judge, formed the opinion that ... "the submission made on behalf of the Official Liquidator is also in conformity with the submission made by Mr. S.N. Mitra, who has largest support of the parties before me (the court)". Hence, the learned Single Judge made it clear that "In that view of the matter, the National Highway Authority was restrained from making any payment on account of compensation to the company in liquidation except by way of an account payee cheque to the Registrar, Original Side of the High Court". Therefore, it is fairly clear that the court had in mind the entire compensation paid by the NHAI in respect of the land acquired by them. Since the NHAI was bound to deduct TDS, an amount of Rs. 10,55,60,331/- was paid to the Income-Tax Department. There can be no doubt whatsoever that the said amount formed part of the compensation. What the court in its order dated 23.02.2011 was requested and the court intended too was to protect the compensation amount. Merely because it goes through the Income-Tax Department, the same does not cease to be part of compensation. Even the respondents herein had submitted before the court at the time of passing the order dated 23.02.2011 that the compensation amount needed to be protected and they were willing to protect it subject to the order of the court. Therefore, the respondents, while handling of the compensation amount, had to seek orders from the court; going by the way they understood the proceedings.20. In that background of the case, we are of the view that the respondents should not have appropriated the refund they received from the Income-Tax Department. There is nothing wrong in claiming the refund. The problem is in utilising the refund received. The refund they received is actually the compensation in respect of the land acquired from the company and it is that amount which the court wanted to protect by its order dated 23.02.2011. Hence, prima facie, we are of the view that the appropriation made by the respondents of the refund amount they received from the Income-Tax Department was in violation of the order dated 23.02.2011. It appears, for that reason only, even the Division Bench declined to disturb the Rule in the contempt proceedings issued against respondents. However, the Division Bench is wholly wrong in entering a finding that there is no violation of the order dated 23.02.2011 in utilising the refund. No doubt, had the refund and subsequent appropriation been of any amount other than the compensation, there would not have been any contempt at all.21. Unfortunately, the Division Bench, in the impugned order, failed to recapitulate the background of the order dated 23.02.2011 and its own earlier orders with regard to the refusal for withdrawal by the respondents of the compensation deposited in court. Even if there be pressing needs, there could not have been any utilisation of the compensation amount without leave of the court. We find that the Division Bench has taken note of the expenditure made by the respondents of the amount they received.It may be seen that the respondents have been managing the affairs of the company for a few years despite the futile attempts made by them to withdraw the compensation lying in deposit in court.24. As held by this Court in Delhi Development Authority v. Skipper Construction Co. (P) Ltd. and another, (1996) 4 SCC 622 , and going a step further, the Court has a duty to issue appropriate directions for remedying or rectifying the things done in violation of the orders. In that regard, the Court may even take restitutive measures at any stage of the proceedings.25. In the background as above of the case, the Division Bench should not have interfered with the order dated 26.06.2015 passed by the learned Single Judge.26. We make it clear that any observations made by us are only for the purpose of this order and shall not have any bearing on the consideration by the learned Single Judge in the contempt proceedings.