$~CP-18 * IN THE HIGH COURT OF DELHI AT NEW DELHI % Date of decision:
03. 04.2018 + CCP(CO.) 2/2017 PEACOCK TOURS PRIVATE LIMITED & ANR......... Petitioner
s Through Mr. Kumar Abhishek Rao, Mr.Shailesh Kumar, Ms. Bhavya Bharti and Ms.Sonal Nagpal, Advs. versus FAROOQ AHMED SHALA & ORS. ........ RESPONDENTS
Through Mr.Arun Saxena and Ms.Priya Verma, Advs. CORAM: HON'BLE MR. JUSTICE JAYANT NATH JAYANT NATH, J.(ORAL) 1. This contempt petition is filed under Section 11 and 12 of the Contempt of Courts Act, 1971 to punish the respondent/contemnor for committing contempt of order dated 29.04.2016 passed in Co.A(SB) 13/2016 by wilfully disobeying the same.
2. It is the case of the petitioners that the respondent is the husband of petitioner No.2.... Petitioner
No.2 filed a complaint under the Protection of Women and Domestic Violence Act, 2005 before the concerned M.M., Saket. During the proceedings, for putting an end to their personal differences and settling all the disputes, the parties i.e. the husband and wife had entered into an MOU dated 28.02.2015. A copy of the MOU was placed on record before the concerned MM. The parties agreed that petitioner No.2 would give up her 15,000 shares in petitioner No.1 Company in lieu of the CCP(CO.) 2/2017 Page 1 of 6 absolute and clear ownership of the residential house being No.103, Pocket- 2, Jasola Vihar, Delhi purchased by petitioner No.2 and the respondent.... Petitioner
No.2 was to keep the custody of the four daughters and the respondent was also to pay a sum of Rs.2 lakhs on the first day of each month starting from 01.03.2015 up to 01.08.2015 and a sum of Rs. 38 lakhs towards compensation to petitioner No.2. It is the case of the petitioners that the respondents has disregarded the process of law and has violated the order of/undertaking given before the MM.
3. In the meantime, the respondents also filed a company petition being Co.Pet. No.77/2015 under Section 397 and 398 of the Companies Act, 1956 before the Company Law Board. The Company Law Board passed an order dated 14.03.2016 which is the subject matter of challenge before this court in a company appeal i.e. Co.A(SB) 13/2016.
4. In Co.A(SB) 13/2016, this court on 29.04.2016 passed the following order: “Co.App.(SB) No.13/2016 & CA Nos.1233/2016, 1235/2016 At the outset, and without prejudice to their stand on merits, counsel for the appellants has submitted that his clients are willing to abide by the terms of the MOU executed between the parties on 28.02.2015. In response, counsel for the respondents also states that his clients are willing to abide by the terms of the said MOU provided, however, the health of the company has not been seriously impaired after 13.04.2015, when the Resolutions removing the respondent No.1 as Director and also effecting transfer of his shareholding to his estranged wife were passed. In furtherance of the aforesaid, both sides are agreed that an independent Chartered Accountant be appointed and that the records and accounts of the company be gone into and examined by an independent Chartered Accountant on a fee to be borne CCP(CO.) 2/2017 Page 2 of 6 equally by both parties and with a view to making an assessment of the comparative status and health of the company both before and after 13.04.2015. Mr. Pradeep Gupta, who has also been representing the interest of a large number of small investors in the matter of DCM Financial Services, which is also posted for today, happens to be present in Court and he has been requested by this Court to suggest name of a Chartered Accountant, who may be able to do the needful. He has suggested the name of Mr. S.C.Malhotra of M/s. S.R. Kapoor & Co., Greater Kailash (Part-I), New Delhi. However, since Mr. Malhotra is out of station, his consent could not be obtained. Mr. Pradeep Gupta to ascertain the availability of Mr. S.C. Malhotra and inform this Court on the next date of hearing. Post this matter on 10.05.2016. Interim orders to continue till the next date of hearing. A copy of this order be given dasti under the signatures of Court Master.” 5. I may point out that the Chartered Accountant appointed pursuant to the above order dated 29.04.2016 has submitted its report dated 27.08.2016. The Chartered Accountant noted as follows:-
"“i) A perusal of the above show that except for fall in Total Revenue in Financial Year 2015-16 there is an overall improvement in fundamentals of the Company from all angles. As regards the fall in Total Revenue is concerned it can be due to many reasons including management dispute, change in strategy of business, & marketing conditions etc. However, the Profits of the Company during Financial Years 2014-15 and 2015-16 have increased substantially. xxx In view of the above facts my considered opinion is that the health of the Company has not seriously impaired before & after 13th April, 2015 based on the fundamentals, as above.” CCP(CO.) 2/2017 Page 3 of 6 6. It is the contention of the petitioners that in view of the report of the Chartered Accountant, in view of the order dated 29.04.2016, the respondent was bound to comply with the MOU in terms of the said order. The failure of the respondent to do the needful tantamounts to wilful disobedience of the order of this court dated 29.04.2016.
7. 8. I have heard learned counsel for the parties. Learned counsel for the respondent strongly reiterated that the report of the Chartered Accountant suffers from defects. He also states that part of the report is based on unaudited balance sheets and presumptions. Reliance is placed on internal page R-5 of the report where it has been stated that the report is based on the audited balance sheet of 31.03.2014 and the balance sheets drawn as on 31.03.2015 and 31.03.2016. It is pleaded that the balance sheets of 31.05.2015 and 31.05.2016 are not audited balance sheets. Certain other comments which are made by the Chartered Accountant in his report are also relied upon. Based on this, it has been pleaded that the report cannot be relied upon and hence, there is no wilful disobedience of the order dated 26.04.2016 of this court.
9. I may note that the parties had moved a joint application before the MM, Saket for taking the settlement dated 28.02.2015 on record.
10. It was pursuant to this MOU which had been filed jointly by the parties before the concerned MM that this court passed the order dated 29.04.2016. In the said order, the statement was recorded of the counsel for the respondent that the respondent is willing to abide by the MOU provided the health of the company has not been seriously impaired after 13.04.2015 when the resolutions removing the respondent as a director and also effecting transfer of the shareholdings to his estranged wife were passed. On CCP(CO.) 2/2017 Page 4 of 6 the agreement of the parties, an independent Chartered Accountant was appointed to go into and examine the records of petitioner No.1 Company.
11. The Chartered Accountant has clearly given his findings that the health of the company has not been impaired since 13.04.2015. Merely because the balance sheets for certain years were not audited cannot be a ground to wriggle out of the undertaking given in court on 29.04.2016.
12. The respondents have before two different courts agreed to abide by the MOU dated 28.02.2015. The MOU had been filed before the court of MM. The respondent again agreed to abide by the MOU before this court in case the Chartered Accountant records a finding that the health of the company has not been seriously impaired after 13.04.2015. The Chartered Accountant has recorded his findings that the health of petitioner No.1 Company is in order.
13. The grounds sought to be raised by the respondent for trying to discard the finding of the Chartered Accountant do not inspire confidence. It appears to be an attempt to wriggle out of the obligation of the respondent to comply with the order dated 29.04.2016. It was because of the statement of the respondent that the exercise to appoint the Chartered Accountant was carried out. A party cannot be permitted to wriggle out of statements made in court in this manner. In my opinion, the respondent prima facie is deliberately and wilfully flouting the order of this court dated 29.04.2016.
14. Prima facie, I hold the respondent guilty of contempt of court. A show cause notice is issued to the respondent to show cause as to why he should not be held guilty for contempt of court. He will file his reply within four weeks from today. Rejoinder, if any, be filed within four weeks thereafter. CCP(CO.) 2/2017 Page 5 of 6 15. List for arguments on 20.07.2018. APRIL03 2018/rb JAYANT NATH, J CCP(CO.) 2/2017 Page 6 of 6