DELHI DEVELOPMENT AUTHORITY versus SKIPPER CONSTRUCTION COMPANY (P) LTD.

Citation: [1996] SUPP. 2 S.C.R. 295 · Decided: 06-05-1996 · Supreme Court of India · Bench: B.P. JEEVAN REDDY

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Judgment (excerpt)

...... 
DELHI DEVELOPMENT AUTHORITY 
v. 
SKIPPER CONSTRUCTION COMPANY (P) LTD. 
MAY 6, 1996 
(B.P. JEEVAN REDDY, K.S. PARIPOORNAN, JJ.] 
Constitution of India, Article 142-Power to do complete justice be-
tween pmties-Sale of space in proposed building by defrauding the people 
and in violation of court orders-Court finding that persons defrauded should 
be restored to the position before the fraud took place-Held, in order to do 
complete justice, the court can make appropriate orders without being in-
hibited by the absence of any statutory provision-Court of Equity. 
A 
B 
c 
Company Law-:Lifting the corporate veil-S, an auction purchaser of 
plot of land defrauding investors by selling space in proposed building even 
while defaulting in payment for land-S diverting monies to front companies D 
of which its chaimian TS, his wife and sons were directors-Held, where 
corporate device is a n1ere cloak for comn1itting illegalities, the veil- would be 
pierced and all members of the family would be treated as one entity; held 
fwther, the property of front company would be attached to realise monies 
owing to the people defrauded-Constitution of India, Article 142. 
E 
Constitution of India Articles 129, 142-contempt of court-S, an 
auction purchaser of plot of land duping.investors by selling space in proposed 
building even while defaulting in payment for land-S wilfully and repeatedly 
disobeying court orders-S issuing advertisements and continuing to sell space 
even after express prohibitory orders of Supreme Court-Held, principle that F 
contemner should not be allowed to enjoy or retain fruits of contempt would 
be given effect to; held further, Article 129 is a cmistiutional power which 
when used in tandem with Article 142 would override technical and proce-
dural objections to such use. 
Constitution of India Articles 136, 142-Finality of orders-in earlier G 
proceedings Supreme Court directing Delhi Development Authority to bring 
to sale of plot of land after auction purchaser repeatedly failed to make 
balance payments-Property sold and sale proceeds realised by DDA-Ques-
tion of repayment of those defrauded by auction-purchase1-Auction pur-
chaser contending that 111onies for repaynient should con1e fronz sale proceeds H 
295 
296 
SUPREME COURT REPORTS [1996] SUPP. 2 S.C.R. 
A 
with DDA-Held, earlier ordei:< under which sale monies vested absolutely in 
DDA became final and were not to be disturbed in pwported exercise of 
power under A1ticle 142; held fwther, ways and means of doing complete 
justice should yet be devised. 
B 
c 
D 
E 
F 
In an auction ofa plot of land in New Delhi by the Delhi Development 
Authority (DDA) in 1980, the highest bid was offered by the respondent S. 
While it deposited twenty-five percent of the sum immediately, S defaulted 
on the payment of the balance. S asked for and was granted by DDA seven 
extensions of time for making payment between January 1981 and April 
1982. As S still did not pay the balance, proceedings were taken for 
cancelling the bid. S went to court and on May 29, 1982 obtained stay of 
cancellation. 
On the recommendations of a committee constituted by the DDA, S 
was asked in 1984 to execute a revised agreement. S raised all sorts of 
objections and finally executed the revised agreement in 1987. 
Even before S was given permission to enter upon the land and start 
construction, it began selling place in the proposed building to various 
persons and in the process collected Rs. 14 crores from purchasers. In a 
writ petition by S questioning DDA's move to cancel its bid, the High Court 
made an order on December 21, 1990 directing S to pay DDA a sum of Rs. 
8.12 crores and stop all further construction with effect from January 9, 
1991 till the date payment was made. S failed to deposit the amount as 
directed. In a Special Leave Petition filed by it, this court granted S an 
interim order on January 29, 1991 subject to it depositing Rs. 2.5 crores 
within one month and another sum of Rs. 2.5 crores before April 8, 1991. 
S was expressly prohibited from inducting any person in the building and 
from creating any rights in favour of third parties. 
Even after January 29, 1991, S repeatedly invited offers from the 
public for purchase of space in the proposed building. In this process it 
G collected a sum of Rs. 11 crores. After the Special Leave Petition was 
dismissed on January 25, 1993 by this court, DDA re-entered the plot and 
took possession of 

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