STATE BANK OF INDIA AND ORS versus DR. VIJAY MALLYA on 11 July 2022

1. These Contempt Petitions have come up before us pursuant tothe Judgment and Order dated 9.5.2017 passed by this Court in “I.ANos.9-12 & 13-16 of 2016 in SLP (C) Nos.6828-6831 of 2016 with I.A.Nos.1-4 of 2016 in and with Contempt Petition (C) Nos.421-424 of 2016in SLP (C) Nos.6828-6831 of 2016”.

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2. After dealing with the facts which led to the filing of theaforestated Interim Applications and Contempt Petitions, this Court foundRespondent No.3 (Dr. Vijay Mallya) guilty of committing contempt ofCourt on two counts. Paragraphs 22 to 30 of said Judgment and Orderdated 9.5.2017 were: - C

“22. We now turn to the alleged violation of orders dated 03.09.2013and 13.11.2013 passed by the High Court of Karnataka. It is notdisputed that such orders were passed restraining the concernedrespondents including Respondent No.3 and that the orders werepassed in proceedings arising from O.A. No.766 of 2013 beforeDRT Bengaluru. The present proceedings before this court havealso arisen from the very same O.A. No.766 of 2013. The ordersof restraints passed by the High Court were therefore in the verysame proceedings with which we are presently concerned. Saidorders bound the concerned respondents including RespondentNo.3 and restrained them from transferring, alienating, disposingor creating third party rights in respect of movable as well asimmovable properties belonging to them till further orders in theproceedings. A question has been raised by Mr. Vaidyanathanlearned senior advocate whether the orders would be restrictedonly so far as the properties which were in the hands of theconcerned respondents as on the date when those orders ofrestraint were passed. In other words, whether any propertieswhich in future or subsequent to the Orders had come in the handsor control of the concerned respondent would be covered by suchorders or not. On plain reading of the Orders, in our view, whetherthe properties were in the hands of the concerned respondents onthe date when the orders of restraint were passed by the HighCourt or had come in their hands or under their control at a laterpoint in time, regardless of such qualification all properties whethermovable or immovable were governed by the orders of restraint.

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There is no ambiguity of any sort and the Orders of restraint arequite clear. Consequently, funds amounting to US$ 40 million whichcame to be under the control of and in the hands of RespondentNo.3 were completely covered and governed by said orders ofrestraint.

23. The memo dated 28.06.2016 filed by Respondent No.10 insaid O.A. No.766 of 2013 annexed, “Extract confirming paymentof US$ (US Dollars) 40 Million to Defendant No.3 on 25.02.2016”.It is thus beyond any doubt that the payment of US$ 40Millionwas received by Respondent No.3 on 25.02.2016. These factsare admitted by Respondent No.3 in Paragraph 3 of his “furthercounter affidavit”. The explanation that the funds now standtransferred in favour of the trusts over which Respondent No.3has no control at all, in fact aggravates the extent of violation. It isclear that the funds which were in control of Respondent No.3have now been sought to be put beyond the reach of processes ofcourt, which is reflective of the intent.

24. The applications moved by the petitioners-banks on 02.03.2016themselves had made clear reference to the fact that as disclosedby respondent Nos.10 and 11 to London Stock Exchange andBombay Stock Exchange respectively Respondent No.10 wouldpay to Respondent No.3 a sum of US$75 million and accordinglypetitioners-banks had moved four interlocutory applications fororders against respondent Nos.10 and 11 for disbursing said amountof US$ 75 million. The amount of US$ 40 Million so received byRespondent No.3 was therefore subject matter of the presentcontroversy. The least that was expected of Respondent No.3was to disclose relevant facts pertaining to receipt anddisbursement of US$ 40 million. The violation on that count isthus not only against the directions issued by this court but alsoagainst express mandate of orders dated 03.09.2013 and13.11.2013 passed in the proceedings in question.

25. Having thus found that the actions on the part of RespondentNo.3 in disbursing the amount of US$ 40 million was against thetext and tenor of the orders passed by the High Court of Karnataka,the question then arises whether this Court can take cognizanceof such violation or should it leave it to be decided by the HighCourt of Karnataka itself in a properly instituted legal proceeding.

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26. In Delhi Judicial Service Association, Tis Hazari Court,Delhi v. State of Gujarat and others[1], a question arose whetherthe power and jurisdiction of this Court under Article 129 of theConstitution is confined to “the contempt of this Court” alone.Submissions advanced in that behalf were noted in paragraph 14of the judgment which sets out the submission of the learnedAttorney General:

“...The Supreme Court as the Apex Court is the protector andguardian of justice throughout the land, therefore, it has a rightand also a duty to protect the courts whose orders and judgmentsare amenable to correction, from commission of contemptagainst them.”

The subsequent paragraphs of the judgment namely paragraph26 onwards show that the contentions so advanced by the learnedAttorney General were accepted by this Court. It is true that thediscussion was in the context of the contempt of a subordinatecourt. However, the nature of power exercisable by this Courtwas considered in the backdrop that this Court has supremeappellate jurisdiction over all courts and tribunals in the countrywhich is clear from the observations in paragraph 31 of thejudgment. We must say that Mr. Vaidyanathan did not seriouslycontend to the contrary but his submission was that if thejurisdiction is so assumed and cognizance is taken by this Court,Respondent No.3 would lose one opportunity of having the matterassessed at the level of the High Court. In our considered view,since we are dealing with the very same cause in which the ordersof restraint were passed by the High Court and since it is coupledwith the violation of orders of this Court as well, the matter canand ought to be dealt with by this Court.

27. The record shows that by order dated 11.01.2017 the violationof those orders for restraint passed by the High Court of Karnatakawas taken note of by this Court and the Counsel appearing forrespondent had sought time to file an appropriate reply. However,no such reply was filed. Respondent No.3 was thus put to clearnotice about the violation of those orders of restraints passed bythe High Court of Karnataka. As such, no prejudice has beencaused or visited upon Respondent No.3.

28. We find that the allegations against Respondent No.3 ofcommitting of contempt are on two counts, in that –

a) He is guilty of disobeying the Orders passed by this Court innot disclosing full particulars of the assets as was directed bythis Court.

b) He is guilty of violating the express Orders of Restraintpassed by the High Court of Karnataka in the same Causefrom which the present proceedings have arisen.

Though the contempt on the second count is theoretically ofthe orders passed by the High Court of Karnataka since thoseorders pertain to the very same Cause and the actions on part ofRespondent No.3 in not disclosing the account in question throughwhich the transfers were affected also fall with respect to contempton first count, we proceed to exercise our contempt jurisdictioneven with regard to the second count. As stated above, RespondentNo.3 was adequately put to notice and no prejudice has beencaused as a result of such assumption of jurisdiction by this court.

29. Having considered the entirety of the matter, we find thatRespondent No.3 is guilty of having committed contempt of courton both the counts. At this stage it must be stated that in terms ofRule 6 (1) of Rules to Regulate Proceeding for Contempt ofSupreme Court 1975, Respondent No.3 was obliged and dutybound to appear in person in response to the notice issued by thisCourt in Contempt Petition. Instead, he chose to file applicationseeking recall of the orders issuing notice. Having considered thematter, we see no reason to recall that order and dismiss I.A.Nos.1 to 4 of 2016 preferred by Respondent No.3 in ContemptPetition Civil Nos.421-424 of 2016. Respondent No.3 is thereforeduty bound to appear in person in the present contempt proceedings.

30. Since Respondent No.3 has not filed any reply to the ContemptPetition nor did he appear in person, though we have found himguilty of having committed contempt of court, we deem it necessaryto give him one more opportunity and also hear him on the proposedpunishment. We therefore adjourn matter to 10.07.2017 for hearingRespondent No.3 in person on matters in issue including oneregarding the proposed punishment to be awarded to him forcontempt of court. The instant contempt petitions and connectedcases shall now be listed at 2 o’clock on 10.07.2017. Respondent A

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No.3 may keep his affidavit ready to be tendered on the sameday by stating mitigating circumstances, if any and any othersubmissions he chooses to advance.

31. We direct the Ministry of Home Affairs, Government of India,New Delhi to secure and ensure presence of Respondent No.3before this Court on 10.07.2017. A copy of this Judgment be sentto the Ministry of Home Affairs for compliance”.

3. The disbursement of US$ 40 million which had entered theaccount held in Edmond De Rothschild (Suisse) S.A. was dealt with indetail and paragraph 3 of the “further counter affidavit” filed byRespondent No.3 was also quoted by this Court as follows: - “16. Respondent No.3 thereafter filed “further counter affidavit”in aforementioned I.A. Nos.9-12 of 2016 on 23.11.2016. Theaffidavit enclosed letter dated 18.11.2016 issued by Edmond DeRothschild (Suisse) S.A. Paragraph 3 of the affidavit was to thefollowing effect:

“On a mere perusal of the letter dated 18th November, 2016issued by Edmond De Rothschild (Suisse) S.A. (Annex. “R-2”hereto), it is evident that the US$ 39,999,994 million paid by DiageoPlc was received on 25th February, 2016. On instructions ofRespondent No.3, an aggregate sum of US$ 39,999,993.99 waspaid to the following parties on 26th and 29th February, 2016respectively:

STATE BANK OF INDIA AND ORS. v. DR. VIJAY MALLYA[UDAY UMESH LALIT, J.]

Each of the three children of Respondent No.3, who are thesole beneficiaries of the aforesaid Trusts, are majors and arecitizens of the United States of America. Respondent No.3 isneither the Settlor nor the Trustee nor the beneficiary of any ofthe aforesaid named Trusts, and has no control over the Trusts orthe manner in which the respective corpuses of each of theaforesaid Trusts is utilized. However, the respective corpuses asthey stood on 31[st] March, 2016 have been included in thestatements of assets of the three children handed over to thisHon’ble Court in sealed envelope on 26[th] April, 2016.” “

4. As stated in paragraphs 29 and 30 quoted hereinabove, anopportunity was given to Respondent No.3 (hereafter referred to as theContemnor) to file his response and advance submissions on the proposedpunishment. The matter was accordingly adjourned to 10.7.2017.

5. The Contemnor however sought review of the Judgment andOrder dated 9.5.2017, which application remained pending for some timeand was rejected by this Court vide Order dated 03.08.2020. By saidorder the Contemnor was directed to appear before this Court; and theMinistry of Home Affairs, Government of India, New Delhi, was directedto facilitate and ensure the presence of the Contemnor on the date ofsuch appearance.

6. The subsequent developments in the matter stand captured inthe Order dated 30.11.2021 passed by this Court, which for facility, isextracted here:- “By judgment dated 09.05.2017 passed by this Court in I.A.Nos.9-12 and 13-16 of 2016 in SLP (Civil) Nos.6828-6831 of 2016and I.A. Nos.1-4 of 2016 in Contempt Petition (C) Nos.421-424of 2016 in SLP (Civil) Nos.6828-6831 of 2016, respondent no.3Dr. Vijay Mallya was found to be guilty of having committedcontempt of court. The judgment directed that the matter be listedon 10.07.2017 to hear respondent no.3 on matters in issue includingone regarding the proposed punishment to be awarded to him forcontempt of court. However, because of proceedings, which atthe relevant time, were going on in the Courts of United Kingdom,the presence of respondent no.3 could not be secured.

In its subsequent order dated 02.11.2020, this Court noted thatcertain proceedings were going on in United Kingdom, though the AB

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details of such proceedings were not forthcoming. This Courtrejected the submission made by Mr. E.C. Agrawala, learnedAdvocate seeking discharge and it was directed that the learnedAdvocate would continue to appear for respondent no.3. Mr. TusharMehta, learned Solicitor General was then granted time to placeStatus Report on record.

The matter was thereafter adjourned on few occasions andbecause of COVID-19 pandemic situation, the matter could notbe listed and taken up.

Today when the matter was called out, Mr. Tushar Mehta,learned Solicitor General invited our attention to the OfficeMemorandum dated 30.11.2021 issued under signature of DeputySecretary (Extradition), CPV Division, Ministry of External Affairs,Government of India. Paragraphs 2 to 5 of the Memorandum readas under:

“2. It may be recalled that an extradition request in respect ofVM was forwarded to UK side on 9 February 2017 in CBICase under Sections 120B read with 420 of the Indian PenalCode and Section 13(2) read with Section 13(1)(d) of thePrevention of Corruption Act, 1988. On 10 December 2018,the Senior District Judge Westminster Magistrate’s Court,London recommended VM’s extradition to India. VM appealedthe Order of his extradition before the High Court of London.The appeal was admitted on the sole ground of sufficiency ofprima facie case. The High Court of London dismissed theappeal on 20 April 2020. VM applied leave to appeal to theSupreme Court in the High Court. On 14 May 2020 the HighCourt of London rejected his application for permission to appealto Supreme Court. VM has thus exhausted all avenues ofappeal in the UK.

3. Following the refusal of leave to appeal, VM’s surrender toIndia should, in principle, have been completed within 28 days.However, the UK Home Office intimated that there is a furtherlegal issue which needs to be resolved before VM’s extraditionmay take place. The UK side further said that this issue isoutside and apart from the extradition process, but it has theeffect that under the United Kingdom law, extradition cannot take place until it is resolved. The High Commission was furtherinformed that the issue is confidential and so it cannot bedisclosed.

4. In compliance with the Order of the Hon’ble Supreme Courtdated 31.08.2020, the Government of India again took up thepending extradition case of VM with the Government of UKso as to seek his early extradition and facilitate his presencebefore the Hon’ble Supreme Court on 5 October 2020.

5. The UK side has informed that extradition of VM cannottake place until a separate legal issue, which is judicial andconfidential in nature is resolved. The UK side emphasizedthat neither they can provide any more details nor intervene inthe process. They have also indicated that through thedesignated channel, the UK Home Office has received arequest to serve summons on VM for his hearing before theHon’ble Supreme Court. The British Home Office hasforwarded the Hon’ble Supreme Court’s Order through theHertfordshire Police on 17 September 2020 for serving it toVM.”

As indicated in paragraph 2 of the Memorandum, theproceedings for extradition have attained finality and respondentno.3 has exhausted all avenues of appeal in the United Kingdom.However, paragraphs 4 and 5 deal with some proceedings whichare stated to be confidential and with regard to which no detailsare forthcoming. It appears that these are the same proceedingswhich were referred to in the order dated 02.11.2020.

Having considered all the circumstances on record, it is directed:a. The matter in terms of the directions issued by this Court inits order dated 09.05.2017 shall now be listed on 18.01.2022.

b. Respondent No.3 is at liberty to advance such submissions,as are deemed appropriate, pertaining to the issues set out inthe order dated 09.05.2017.

c. If, for any reason, respondent no.3 is not present to advancesuch submissions, learned counsel on his behalf can advancesuch submissions as are open to respondent no.3, in law.

d. We request Mr. Jaideep Gupta, learned Senior Advocate ofthis Court to assist the Court as Amicus Curiae in the matter.

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Mr. Gupta will be at liberty to avail services of any Advocate-on-Record of his own choice in the instant matter.

The Registry is directed to supply papers of this matter to Mr.Gupta within a week.

e. The matter shall be dealt with finally on 18.01.2022.”

7. The matter thereafter came up before this Court on 10.03.2022on which date the following Order was passed: - “1. Pursuant to orders passed from time to time and moreparticularly orders dated 30.11.2021 and 10.02.2022, the matter isposted today for hearing.

2. In terms of Directions (b) and (c) issued by this Court videorder dated 30.11.2021, the contemnor was given specific libertyto advance submissions pertaining to the issues set-out in thejudgment dated 09.05.2017. Additionally, he was given furtherliberty to advance such submissions through his learned Counsel.

3. Mr. Ankur Saigal, learned counsel appearing on behalf of thecontemnor submits that all the orders including the orders dated30.11.2021 and 10.02.2022 were brought to the notice of thecontemnor and that there was exchange of communicationsbetween the learned counsel and the contemnor. A copy of thecommunication dated 17.01.2022 has been placed for our perusalwhich communication inter alia states inability on part of theSolicitors of the contemnor to provide any information about thenature of proceedings and the relief sought in the pendingproceedings in the United Kingdom.

4. We then invited Mr. Ankur Saigal, learned counsel to advancesubmissions on merits of the matter in keeping with the directionsissued in last two orders. Mr. Saigal expressed his inability toadvance the submissions.

5. We have heard Mr. Jaideep Gupta, learned Senior Advocate,who has assisted this Court as Amicus Curiae very ably. He hasinvited our attention to various aspects of the record including thejudgment dated 09.05.2017 in State Bank of India & Others v.Kingfisher Airlines Ltd. & Others, (2017) 6 SCC 654, provisionsof the Contempt of Courts Act and the Supreme Court Rules,2013. He has also relied upon various decisions of this Court including the decision in Supreme Court Bar Association v. Unionof India & Another, (1998) 4 SCC 409.

6. Mr. Gupta may file his written submissions on or before12.03.2022.

7. Even though Mr. Ankur Saigal, learned counsel has expressedhis inability to advance submissions though he was invited to doso, we still grant one more opportunity to file his submissions onor before 15.03.2022, with an advance copy to the learned AmicusCuriae.”

8. The oral arguments advanced by Mr. Jaideep Gupta, learnedAmicus Curiae were summarized in his Written Submissions as under: - “A. The sum of the money which was received by EdmonddeRothschild (Suisse) M.A. was, on the instruction of theRespondent No.3/ contemnor, paid to three trusts wherein thesole beneficiaries were the son and two daughters of theRespondent No.3/ Contemnor. The aforementioned amount hadbeen transferred in violation of order of court by taking advantageof the very act of contempt which has been held against theContemnor/ Respondent No.3. It is, therefore, submitted that thisHon’ble Court may give appropriate direction for reversal of theaforesaid transactions by declaring the said transactions to bevoid.

B. The present contempt proceedings arise out of recoveryproceedings by Banks. It is stated by the Counsel on behalf ofState Bank of India that decrees have been passed against theRespondent No.3 in the said recovery proceedings and RecoveryOfficer has been appointed for enforcement and execution of thesaid decree. It thought fit, this Hon’ble Court may give appropriatedirection to the said Recovery Officer to trace the said funds intothe hands of whoever they may have been transferred to and usethe same in execution of the decree.

C. In the event the said funds are found inadequate to purge thesaid contempt, appropriate orders may be passed for sequestrationof the assets of the respondent no.3/ contemnor both in India andoutside. Assistance of the Banks and/ or the Union of India maybe taken to find out all assets that may be available to the respondentNo.3/ Contemnor. Alternatively, a forensic auditor may beappointed to undertake such an exercise.”

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AReliance was placed by the learned Amicus Curiae on thedecisions of this Court in Supreme Court Bar Association v. Union ofIndia & Anr.[2], Noorali Babul Thanewala v. K.M.M. Shetty & Ors.[3],Rama Narang v. Ramesh Narang[4], Pravin C. Shah v. K.A. Mohd. Ali& Anr.[5] to submit that in contempt jurisdiction the Court can direct thecontemnor to purge the contempt by reversing the very transaction thatBwas found to be contumacious. On the remedy of sequestration of assets,reliance was placed on Rose v. Laskington[6], Mir v. Mir[7] and Richardsonv. Richardson[8].

9. In spite of repeated opportunities afforded to the Contemnor,no submissions were advanced on his behalf either on purging of contemptCor on the quantum of punishment.

10. The actions on part of the Contemnor having been found to becontumacious and established in the Judgment and Order dated09.05.2017, we are presently concerned with the issues as to what ordersbe passed regarding punishment and purging of contempt. The approachDin such cases was succinctly stated by this Court in Pravin C. Shah v.K.A. Mohd. Ali & Anr.[5 ]as under:

“23. Now we have to consider the crucial question — how can acontemnor purge himself of the contempt? According to theDisciplinary Committee of the Bar Council of India, purging oneselfEof contempt can be done by apologising to the court. The saidopinion of the Bar Council of India can be seen from the followingportion of the impugned order:

“Purging oneself of contempt can be only by regretting orapologising in the case of a completed action of criminalFcontempt. If it is a case of civil contempt, by subsequentcompliance with the orders or directions the contempt can bepurged of. There is no procedural provision in law to get purgedof contempt by an order of an appropriate court.”

G2 (1998) 4 SCC 409.3 (1990) 1 SCC 259.4 (2009) 16 SCC 126.5 (2001) 8 SCC 650.6 (1989) 3 AllER 306.

7 (1992) 1 AllER 765.H8 (1989) 3 AllER 779.

24. Purging is a process by which an undesirable element isexpelled either from one’s own self or from a society. It is a cleaningprocess. Purge is a word which acquired implications first intheological connotations. In the case of a sin, purging of such sinis made through the expression of sincere remorse coupled withdoing the penance required. In the case of a guilt, purging meansto get himself cleared of the guilt. The concept of purgatory wasevolved from the word “purge”, which is a state of suffering afterthis life in which those souls, who depart this life with their deadlysins, are purified and rendered fit to enter into heaven wherenothing defiled enters (vide Words and Phrases, Permanent Edn.,Vol. 35-A, p. 307). In Black’s Law Dictionary the word “purge”is given the following meaning: “To cleanse; to clear. To clear orexonerate from some charge or imputation of guilt, or from acontempt.” It is preposterous to suggest that if the convicted personundergoes punishment or if he tenders the fine amount imposedon him the purge would be completed.

25. We are told that a learned Single Judge of the Allahabad HighCourt has expressed a view that purging process would becompleted when the contemnor undergoes the penalty [vide MadanGopal Gupta (Dr) v. Agra University [AIR 1974 All 39] ]. This iswhat the learned Single Judge said about it: (AIR p. 43, para 13)

“In my opinion a party in contempt purged its contempt byobeying the orders of the court or by undergoing the penaltyimposed by the court.”

26. Obeying the orders of the court would be a mode by whichone can make the purging process in a substantial manner when itis a civil contempt. Even for such a civil contempt the purgingprocess would not be treated as completed merely by thecontemnor undergoing the penalty imposed on him unless he hasobeyed the order of the court or he has undone the wrong. If thatis the position in regard to civil contempt the position regardingcriminal contempt must be stronger. Section 2 of the Contempt ofCourts Act categorises contempt of court into two categories.The first category is “civil contempt” which is the wilfuldisobedience of the order of the court including breach of anundertaking given to the court. But “criminal contempt” includesdoing any act whatsoever, which tends to scandalise or lowers AB

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the authority of any court, or tends to interfere with the due courseof a judicial proceeding or interferes with, or obstructs theadministration of justice in any other manner.

27. We cannot therefore approve the view that merely undergoingthe penalty imposed on a contemnor is sufficient to complete theprocess of purging himself of the contempt, particularly in a casewhere the contemnor is convicted of criminal contempt. Thedanger in giving accord to the said view of the learned SingleJudge in the aforecited decision is that if a contemnor is sentencedto a fine he can immediately pay it and continue to commit contemptin the same court, and then again pay the fine and persist with hiscontemptuous conduct. There must be something more to be doneto get oneself purged of the contempt when it is a case of criminalcontempt.”

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11. Similarly, following observations were made and directionswere issued by this Court in Noorali Babul Thanewala v. K.M.M.DShetty & Ors.[3]:

“11. ……..It is settled law that breach of an injunction or breachof an undertaking given to a court by a person in a civil proceedingon the faith of which the court sanctions a particular course ofaction is misconduct amounting to contempt. The remedy in suchcircumstances may be in the form of a direction to the contemnorto purge the contempt or a sentence of imprisonment or fine or allof them. On the facts and circumstances of this case in the lightof our finding that there was a breach of the undertaking we thinkthat mere imposition of imprisonment or fine will not meet theends of justice. There will have to be an order to purge thecontempt by directing respondent 1-contemnor to deliver vacantpossession immediately and issuing necessary further andconsequential directions for enforcing the same.

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12. In the foregoing circumstances, we find respondent 1 guiltyof committing contempt by wilful disobedience of the undertakinggiven by him in this Court and accordingly we convict him andsentence him to pay a fine of Rs 500 within the period of fourweeks, failing which he shall suffer simple imprisonment for onemonth, and also direct him to deliver vacant possession of thepremises forthwith to the petitioner to the extent possible by him.

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We further direct the District Magistrate, Thane, to evict all thosewho are in physical possession of the property including respondent2 and his men and if necessary, with police help and give vacantpossession of the premises to the petitioner forthwith.”

12. The importance of passing appropriate directions, apart fromimposing punishment upon the contemnor, was stressed by the ConstitutionBench of this Court in Supreme Court Bar Association v. Union ofIndia & Anr.[2] as follows:

“33. Thus, the recognised and accepted punishments for civil orcriminal contempt of court in English law, which have been followedand accepted by the courts in this country and incorporated in theIndian law insofar as, civil contempt, is concerned are:

(i) sequestration of assets;

(ii) fine;

(iii) committal to prison.

34. The object of punishment being both curative and corrective,these coercions are meant to assist an individual complainant toenforce his remedy and there is also an element of public policyfor punishing civil contempt, since the administration of justicewould be undermined if the order of any court of law is to bedisregarded with impunity. Under some circumstances, complianceof the order may be secured without resort to coercion, throughthe contempt power. For example, disobedience of an order topay a sum of money may be effectively countered by attachingthe earnings of the contemner. In the same manner, committingthe person of the defaulter to prison for failure to comply with anorder of specific performance of conveyance of property, may bemet also by the court directing that the conveyance be completedby an appointed person. Disobedience of an undertaking may inthe like manner be enforced through process other than committalto prison as for example where the breach of undertaking is todeliver possession of property in a landlord-tenant dispute. Apart from punishing the contemner, the court to maintain the majestyof law may direct the police force to be utilised for recovery ofpossession and burden the contemner with costs, exemplary orotherwise.”

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A13. It is, thus, well settled that apart from punishing the contemnorfor his contumacious conduct, the majesty of law may demand thatappropriate directions be issued by the court so that any advantagesecured as a result of such contumacious conduct is completely nullified.The approach may require the court to pass directions either for reversalof the transactions in question by declaring said transactions to be voidBor passing appropriate directions to the concerned authorities to see thatthe contumacious conduct on the part of the contemnor does not continueto enure to the advantage of the contemnor or any one claiming underhim. It is precisely for these reasons that the direction to have vacantpossession delivered to the rightful claimant was passed by this Court inCNoorali Babul Thanewala v. K.M.M. Shetty & Ors.[3] Mere passing ofan order of punishment as stated by this Court in Pravin C. Shah v.K.A. Mohd. Ali & Anr.[5] would not be enough or sufficient. In a givencase, to meet the ends of justice, the concept of purging of the contemptwould call for complete disgorging of all the benefits secured as a resultof actions which are found by the court to be contumacious.D

14. In its Judgment and Order dated 09.05.2017, this Court hadfound that the action on part of the Contemnor in disbursing the amountof US$ 40 million was against the text and tenor of orders passed by theHigh Court of Karnataka and that the Contemnor was guilty of contempt.

E15. In the circumstances, in order to maintain the majesty of law,we must impose adequate punishment upon the Contemnor and mustalso pass necessary directions so that the advantages secured by theContemnor or anyone claiming under him are set at naught and theamounts in question are available in execution of the decrees passed inthe concerned Recovery Proceedings.F

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16. Considering the facts and circumstances on record and thefacts that the Contemnor never showed any remorse nor tendered anyapology for his conduct, we impose sentence of four months and fine inthe sum of Rs.2,000/- (Rupees Two Thousand Only) upon the Contemnor.The fine shall be deposited in the Registry of this Court within fourGweeks and upon such deposit, the amount shall be made over to theSupreme Court Legal Services Committee. In case the amount of fine isnot deposited within the time stipulated, the Contemnor shall undergofurther sentence of two months.

We direct the Ministry of Home Affairs, Government of India,HNew Delhi to secure the presence of the Contemnor to undergo the STATE BANK OF INDIA AND ORS. v. DR. VIJAY MALLYA[UDAY UMESH LALIT, J.]

imprisonment imposed upon him. Needless to say, Government of Indiaincluding the Ministry of External Affairs and all other agencies orinstrumentalities shall carry out the directions issued by this Court withdue diligence and utmost expediency. A Compliance Report shallthereafter be filed in the Registry of this Court.

17. We also direct:

A.The transactions referred to in the Judgment and Orderdated 09.05.2017 in terms of which the amount of US$ 40million was disbursed to the beneficiaries detailed inparagraph 16 of the said judgment and order is held to bevoid and inoperative; B.The Contemnor and the beneficiaries under said transactionsreferred to in the said Paragraph 16 shall be bound to depositthe amount received by such beneficiaries along withinterest at the rate of 8 per cent per annum with theconcerned Recovery Officer within four weeks.

C.In case the amounts are not so deposited, the concernedRecovery Officer shall be entitled to take appropriateproceedings for recovery of said amounts; and Governmentof India and all the concerned agencies shall extendassistance and complete cooperation. It shall be open totake such appropriate steps including the appointment ofForensic Auditor(s).

18. In the end, we must express our sincere gratitude andappreciation for the efforts put in by Mr. Jaideep Gupta, learned SeniorAdvocate who assisted this Court very ably as Amicus Curiae.

19. These contempt petitions, thus, stand disposed of.

Nidhi Jain

Contempt petitions disposed of.

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