BANK OF INDIA versus VIJAY TRANSPORT AND ORS.

Citation: [2000] SUPP. 3 S.C.R. 685 · Decided: 12-10-2000 · Supreme Court of India · Bench: S.P. BHARUCHA · Disposal: Disposed off

Judgment (excerpt)

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BANK OF INDIA 
A 
v. 
VIJA Y TRANSPORT AND ORS. 
OCTOBER 12, 2000 
[S.P. BHARUCHA, Y.K. SABHARWAL AND RUMA PAL, JJ.] 
B 
Contempt of Courts Act, I 9 7 I: Sections 2 and I 2. 
Contempt of Court-Bank-Suit for recovery-Counter claim by 
defendants-Suit decreed in part and counter claim allowed in its entirety- C 
Appeal-High Court staying the counter claim subject to bank depositing 
certain amount-Defendants allowed to withdraw the amount after furnishing 
bank guarantee for the same amount-Subsequently, High Court decreeing 
the suit and dismissing the counter claim-Banks application for restitution 
of amount deposited-Guarantor bank depositing the amount in the Court- D 
Defendants in a planned manner transferring the restitution application to 
another court and withdrawing the amount deposited in the court-Amount 
not repaid even after several assurances-Unconditional offer made before 
Supreme Court was resiled from and undertakings given to court were 
breached-Held, unauthorisedly dealing with property in custodia legis and 
violating orders of court tantamount to contempt-Action of defendants E 
amounts to unauthorised dealing with property in custodia legis and violation 
of Courts' orders-Thus, they were guilty of contempt of court. 
Sentence-Quantum-Determination of-Events taking place subsequent 
to contempt notice-Relevancy of-Contemners obtaining adjournments 
assuring payment and settlement, but not fuljilling the same-Unconditional F 
offer to pay·decretal amount, resiledfrom-Held, contemners have compounded 
contumacious conduct with which they were charged with further act of 
contumacy-Events taking place subsequent to issuance of contempt notice 
are certainly relevant for determining the sentence-Thus, contemners 
sentenced to simple imprisonment for two years alongwith fine. 
G 
Words & Phrases 
"Custodia legis "-Meaning of 
Respondent No. 2 was sole surviving partner of respondent No. 1 firm, H 
685 
686 
SUPREME COURT REPOROfS [2000] SUPP. 3 S.C.R. 
A and respondent No. 3 was her husband and power of attorney holder. 
Petitioner-bank filed a suit for recovery of ce11ain amount against respondent 
No. 1. Respondent No. 1 raised a counter claim for a larger amount. Trial 
Court partly decreed the claim of petitioner-bank allowed the counter claim 
of respondent in its entirety. On appeal, High Court stayed the counter claim 
subject to the petitioner-bank depositing Rs. 16 lakhs in the court Respondent 
B No. 1 was allowed to withdraw the said sum of Rs. 16 lakhs upon furnishing 
a bank guarantee for the same amount. However, subsequently High Court 
decreed the suit of the petitioner-bank and dismissed the counter claim of 
the respondent Consequently, petitioner-bank approached the Trial Court for 
restitution of the amount deposited pursuant to the order of High Court. On 
C the direction of the court, guarantor bank deposited the amount of Rs. 16 
lakhs. Respondents in a planned manner transferred the restitution 
application to another trial court and wilfully procured a cheque for Rs. 16 
lakhs and got the same encashed. High Court initiated recovery proceeding 
against respondents but the amount was not repaid. On appeal before this 
D 
Court respondents undertook to deposit the amount but failed to do so. 
Consequently, this Court initiated a suo motu contempt proceeding against 
the respondents for unauthorised dealing with property in custodia legis and 
violating the Court's Order. The Bank also filed a contempt petition against 
the respondents. 
E 
Pursuant to the contempt notice, respondents appeared before this 
Court and assured that the amount will be deposited within eight weeks. But 
despite the said assurance, the amount was not deposited and time was 
sought to file reply to the suo motu contempt notice. Respondents after 
taking several adjournments ultimately deposited the amount of Rs. 16 
lakhs. Thereafter, respondents on the pretext of reaching a settlement with 
F 
the plaintiff for payment of the decretal amount with interest obtained several 
adjournments but no settleme~t was reached. On issuance of non-bailable 
warrant, the respondents appeared before this court and made an 
"unconditional offer" for payment of decretal amount with interest in four 
instalments but failed to pay the first instalment itself in time. Thereafter, 
G respondents offered certain immovable properties which could be sold to 
meet the decretal amount. But later it was revealed that the

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