# CASE DETAILS ORBIT ELECTRICALS PRIVATE LIMITED v. DEEPAK KISHAN CHHABRIA & ORS

- **Citation:** 2023 INSC 967
- **Court:** Supreme Court of India
- **Decided:** 2023-10-30
- **Case number:** Civil Appeal No. 6108 of 2023
- **Bench:** Dr. Dhananjaya Y Chandrachud
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/case-details-orbit-electricals-private-limited-v-deepak-kishan-chhabria-ors-36802
- **Pages:** 24

## Headnote

Issue for consideration: Order dtd.13.10.23 was passed by the
Supreme Court directing NCLAT to pronounce judgment in the pending
appeal only after the results of the Annual General Meeting of Finolex
Cables Limited were declared. Despite the fact that NCLAT's attention was
drawn to the order of the Supreme Court, it went on to deliver the judgment
ignoring the direction therein. Said order, if was in willful defi ance of the
Supreme Court's order.
Contempt - Interim direction passed by the NCLAT at the stage
of reserving orders, restoring the status quo ante as available prior to
EOGM dtd.03.05.19 was vacated by Supreme Court - While vacating
the order, it was noted that the Annual General Meeting (AGM) of
Finolex Cables Limited was to take place on 29.09.23 and directed that
any action taken on the appointment of the Executive Chairperson
shall be subject to the outcome of the appeal pending before NCLAT -
Proceedings mentioned in the Contempt Petition, apprising the Supreme
Court that the declaration of the result of the AGM was deferred till
the declaration of the judgment by NCLAT - Vide Order dtd.13.10.23,
Scrutinizer was directed to declare the result of the AGM and NCLAT
was directed to declare its judgment in the pending appeal after it
was duly apprised of the fact that the result of the AGM was declared
- Grievance of the Petitioners that the NCLAT was though apprised
1023
of the said order, it proceeded to deliver the judgment ignoring the
direction therein- Chairperson of the NCLAT directed to verify the
position and submit report- Report submitted - Affi davits fi led by
the two members who constituted the Bench of the NCLAT and by
the Scrutiniser:
Held: From the CCTV footage as well as from the transcript, it is
evident beyond doubt that though the NCLAT was duly apprised of the
fact that this Court had in the morning session on 13.10.23 passed an order
to the eff ect that the judgment shall be pronounced only after the results
by the Scrutiniser were declared, the Bench of the NCLAT declined to
pay heed to the order of this Court - The Bench of the NCLAT acted in
willful defi ance of the order despite the fact that its attention was drawn to
the order of this Court - Unconditional apology tendered by the Member
(Technical) accepted - As regards the Member (Judicial), what was stated
by him was contrary to the record - This was compounded by what had
been stated in the affi davit fi led - The conduct of the Member (Judicial) is
censured - Further, on facts, there is no doubt that the the Scrutiniser acted
in concert with 'DKC', the then acting Chairman-cum-Managing Director
to delay the declaration of the result of the AGM, in breach of the directions
issued by this Court - 'DKC' to pay Rs.1 crore and the Scrutiniser to pay
Rs.10 lakhs to the Prime Minister's Relief Fund - Directions issued in
the earlier order of this Court setting aside the judgment delivered by the
Bench of the NCLAT on 13.10.23, reiterated - Contempt proceedings
disposed of. [Paras 19, 21-24, 26, 28, 31 and 33]
OTHER CASE DETAILS INCLUDING IMPUGNED
ORDER AND APPEARANCES
INHERENT JURISDICTION: Contempt Petition (Civil) No. 1195
of 2023 in Civil Appeal No. 6108 of 2023.
From the Judgment and Order dated 21.09.2023 of the National
Company Law Appellate Tribunal, Principal Bench at New Delhi in
Company Appeal (AT) No.64 of 2020.
Appearances:
Mukul Rohatgi, Ranjeet Kumar, Neeraj Kishan Kaul, Sr. Advs.,
Kunal Mehta, Shikhil Suri, Abhinav Agrawal, Advs. for the Petitioner.
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1024
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Tushar Mehta, SG, Shyam Divan, Maninder Singh, Darius Khambata,
Dr. A.M. Singhvi, Krishnendu Dutta, P.S. Patwalia, Prashanto Sen, Sr.
Advs., Amit Jajoo, Malak Manish Bhatt, Ms. Vatsala Pant, Mandeep Singh,
Somasekhar Sundaresan, Ravi Gadagkar, Nitin Saluja, Saahil Mongia, Ms.
Ishita Soni, Ms. Simran Khurana, Ms. Pranya Madan, Ankur Saigal, E.C.
Agrawala, Shashwat S

## Text

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[2023] 15 S.C.R. 1022 : 2023 INSC 967
1022
CASE DETAILS
ORBIT ELECTRICALS PRIVATE LIMITED
v.
DEEPAK KISHAN CHHABRIA & ORS.
(Contempt Petition (Civil) No 1195 of 2023)
In
(Civil Appeal No. 6108 of 2023)
OCTOBER 30, 2023
[DR. DHANANJAYA Y CHANDRACHUD, CJI,
J. B. PARDIWALA AND MANOJ MISRA, JJ.]
HEADNOTES
Issue for consideration: Order dtd.13.10.23 was passed by the
Supreme Court directing NCLAT to pronounce judgment in the pending
appeal only after the results of the Annual General Meeting of Finolex
Cables Limited were declared. Despite the fact that NCLAT's attention was
drawn to the order of the Supreme Court, it went on to deliver the judgment
ignoring the direction therein. Said order, if was in willful defi ance of the
Supreme Court's order.
Contempt - Interim direction passed by the NCLAT at the stage
of reserving orders, restoring the status quo ante as available prior to
EOGM dtd.03.05.19 was vacated by Supreme Court - While vacating
the order, it was noted that the Annual General Meeting (AGM) of
Finolex Cables Limited was to take place on 29.09.23 and directed that
any action taken on the appointment of the Executive Chairperson
shall be subject to the outcome of the appeal pending before NCLAT -
Proceedings mentioned in the Contempt Petition, apprising the Supreme
Court that the declaration of the result of the AGM was deferred till
the declaration of the judgment by NCLAT - Vide Order dtd.13.10.23,
Scrutinizer was directed to declare the result of the AGM and NCLAT
was directed to declare its judgment in the pending appeal after it
was duly apprised of the fact that the result of the AGM was declared
- Grievance of the Petitioners that the NCLAT was though apprised
1023
of the said order, it proceeded to deliver the judgment ignoring the
direction therein- Chairperson of the NCLAT directed to verify the
position and submit report- Report submitted - Affi davits fi led by
the two members who constituted the Bench of the NCLAT and by
the Scrutiniser:
Held: From the CCTV footage as well as from the transcript, it is
evident beyond doubt that though the NCLAT was duly apprised of the
fact that this Court had in the morning session on 13.10.23 passed an order
to the eff ect that the judgment shall be pronounced only after the results
by the Scrutiniser were declared, the Bench of the NCLAT declined to
pay heed to the order of this Court - The Bench of the NCLAT acted in
willful defi ance of the order despite the fact that its attention was drawn to
the order of this Court - Unconditional apology tendered by the Member
(Technical) accepted - As regards the Member (Judicial), what was stated
by him was contrary to the record - This was compounded by what had
been stated in the affi davit fi led - The conduct of the Member (Judicial) is
censured - Further, on facts, there is no doubt that the the Scrutiniser acted
in concert with 'DKC', the then acting Chairman-cum-Managing Director
to delay the declaration of the result of the AGM, in breach of the directions
issued by this Court - 'DKC' to pay Rs.1 crore and the Scrutiniser to pay
Rs.10 lakhs to the Prime Minister's Relief Fund - Directions issued in
the earlier order of this Court setting aside the judgment delivered by the
Bench of the NCLAT on 13.10.23, reiterated - Contempt proceedings
disposed of. [Paras 19, 21-24, 26, 28, 31 and 33]
OTHER CASE DETAILS INCLUDING IMPUGNED
ORDER AND APPEARANCES
INHERENT JURISDICTION: Contempt Petition (Civil) No. 1195
of 2023 in Civil Appeal No. 6108 of 2023.
From the Judgment and Order dated 21.09.2023 of the National
Company Law Appellate Tribunal, Principal Bench at New Delhi in
Company Appeal (AT) No.64 of 2020.
Appearances:
Mukul Rohatgi, Ranjeet Kumar, Neeraj Kishan Kaul, Sr. Advs.,
Kunal Mehta, Shikhil Suri, Abhinav Agrawal, Advs. for the Petitioner.
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1024
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Tushar Mehta, SG, Shyam Divan, Maninder Singh, Darius Khambata,
Dr. A.M. Singhvi, Krishnendu Dutta, P.S. Patwalia, Prashanto Sen, Sr.
Advs., Amit Jajoo, Malak Manish Bhatt, Ms. Vatsala Pant, Mandeep Singh,
Somasekhar Sundaresan, Ravi Gadagkar, Nitin Saluja, Saahil Mongia, Ms.
Ishita Soni, Ms. Simran Khurana, Ms. Pranya Madan, Ankur Saigal, E.C.
Agrawala, Shashwat Singh, Ms. Geetika Sharma, Amit Pawan, Suchit
Singh Rawat, Ms. Shivangi, Anand Nandan, Aakarsh, Hassan Zubair
Waris, Kanu Agrawal, Madhav Sinhal, Bhuvan Kapoor, Deepak Khosla,
Advs. for the Respondents.
JUDGMENT / ORDER OF THE SUPREME COURT
ORDER
1 The order of this Court of 26 September 2023 sets out the
background. Rather than replicate the background, we set it out below :
"1
The National Company Law Tribunal1 dismissed the application
fi led by the fi rst respondent for the grant of interim relief by
an order dated 31 December 2019. The fi rst respondent is in
appeal before the National Company Law Appellate Tribunal2.
Admittedly, no interim relief operated in favour of the fi rst
respondent during the pendency of the appeal.
2
The appeal has been heard and orders were reserved by the
NCLAT on 21 September 2023. However, while reserving
orders, the NCLAT has directed the parties "to maintain status
quo as was available prior to EOGM dated 03.05.2019" till
the judgement is delivered. No reasons have been indicated
by the NCLAT even prima facie for issuing the interim order,
particularly in the context of the fact that there was no interim
relief operating since the dismissal of the application for
interim relief on 31 December 2019. It is admitted that no
relief was obtained by the fi rst respondent in the proceedings
before the Bombay High Court, as well.
1
"NCLT"
2
"NCLAT"
1025
3
In the circumstances, we vacate the interim direction as noted
above. The Annual General Meeting (AGM) of the company,
Finolex Cables Limited is to take place on 29 September
2023. Any action which is taken on proposed resolution No
4 pertaining to the appointment of the Executive Chairperson
shall be subject to the outcome of the appeal which is pending
before the NCLAT.
4
Subject to the aforesaid modifi cations, the appeals are allowed
and the impugned order is set aside to the aforesaid extent.
5
Pending applications, if any, stand disposed of."
2 By the above order of this Court, the interim direction which was
passed by the NCLAT on 21 September 2023 at the stage of reserving orders,
restoring the status quo ante "as was available prior to EOGM dated 3 May
2019" was vacated bearing in mind that :
(i)
No reasons at all were indicated;
(ii)
No interim relief had operated since the dismissal of the
application for interim relief on 31 December 2019; and
(iii) No relief was obtained by the fi rst respondent in proceedings
before the Bombay High Court.
3 While vacating the interim order, this Court noted that the Annual
General Meeting of Finolex Cables Limited was to take place on 29
September 2023 and specifi cally directed that "any action which is taken
place on proposed resolution No 4 pertaining to the appointment of the
Executive Chairperson shall be subject to the outcome of the appeal which
is pending before the NCLAT."
4 Subsequently on 13 October 2023, the proceedings were mentioned
before this Court in the morning session in Contempt Petition No 1195 of
2023, when the Court was apprised of the fact that the declaration of the
result of the AGM was being deferred till the declaration of the judgment
by the NCLAT. Taking note of the submission, this court observed :
"We are prima facie of the view that the mandate of the order cannot
be defeated by deferring the declaration of the result till a judgment
is rendered by NCLAT."
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1026
SUPREME COURT REPORTS
[2023] 15 S.C.R.
5 This Court specifi cally issued the following directions :
"5 The scrutinizer shall, in compliance with the order of this Court
proceed to declare the result of the Annual General Meeting
which was held on 29 September 2023 forthwith;
6
The NCLAT shall proceed to declare its judgment in the pending
appeal after it is duly apprised of the fact that the result of the
Annual General Meeting has been declared."
6 The above directions of this Court were in two parts. The fi rst part
which applied to the Scrutiniser contained a specifi c direction to the eff ect
that in compliance with the previous order, the Scrutiniser shall proceed to
declare the result of the AGM which was held on 29 September 2023. The
second part, which was a direction to the NCLAT, was specifi cally to the
eff ect that the NCLAT shall proceed to declare its judgment in the pending
appeal after it is duly apprised of the fact that the result of the AGM has
been declared.
7 In the afternoon session on 13 October 2023, a grievance was made
before this Court on behalf of the petitioners that though the NCLAT was
apprised of the order of this Court with a request that the judgment should
not be delivered until the report of the Scrutiniser is made available, the
Bench of the NCLAT had proceeded to deliver the order.
8 Consequently, this Court took note of the submission and required
the Chairperson of the NCLAT to duly verify the position and report back
to the Court. Paragraphs 3 to 9 of the order are set out below :
"3
Mr Neeraj Kishan Kaul and Dr Abhishek Manu Singhvi,
senior counsel and Mr Shikhil Suri, counsel joined in stating
that counsel, Mr Ankur Saigal (who is personally present
before this Court) produced the order of this Court before the
National Company Law Appellate Tribunal (NCLAT) at 2 pm
with a request that the judgment should not be delivered until
report of the scrutinizer is made available.
4
The Court has been apprised of the fact that the Bench of
the NCLAT consisting of Mr Rakesh Kumar and Dr Alok
Srivastava proceeded to deliver the order. If what is stated is
1027
correct, this will clearly constitute the defi ance of the order
of this Court by the NCLAT.
5
At this stage we are not commenting on the merits of the
submissions which have been made.
6
The Court is apprised that the scrutinizer report was uploaded
at 2.40 pm.
7
We direct that an enquiry shall be conducted on the above
allegations by the Chairperson of the NCLAT. A report shall
be submitted before this Court by 5 pm on 16 October 2023
after specifi cally verifying the facts from the Judges who
constituted the Bench of the NCLAT.
8
The Chairperson of the NCLAT shall specifi cally verify:

(i)
That the order of this Court dated 13 October 2023 passed
in the morning session was drawn to the attention of the
two Judges;

(ii)
If that is so, the circumstances in which the Judges
proceeded to pronounce the judgment despite the clear
mandate of the order of this Court which was passed in
the morning session.
9
We are passing this order in extraordinary circumstances,
upon an urgent mentioning being made in that regard."
9 In compliance with the order of this Court, the Chairperson of the
NCLAT submitted a report before this Court which was taken note of in
the order of this Court dated 18 October 2023. The relevant part of the
order of this court reads thus :
"7
Pursuant to the order of this Court, Justice Ashok Bhushan, the
learned Chairperson of the NCLAT has upon due verifi cation
from the Judges submitted a report to this Court. The report
alludes to two separate statements which have been made
before the Chairperson. The statement by Mr Rakesh Kumar,
Member (Judicial) is recorded in paragraph 3 of the report in
the following terms:
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1028
SUPREME COURT REPORTS
[2023] 15 S.C.R.
"Justice Rakesh Kumar, Member (Judicial) has given
a response vide his letter dated 16.10.2023 which was
received by me during lunch hours of 16.10.2023. In the
response, the Member (Judicial) has stated "I may inform
that on Friday in the Supplementary Cause List dated
13.10.2023 at 2 PM Company Appeal (AT) No 64/2020
(Deepak Chhabaria and Another) was listed under the
caption "For Judgment" for its pronouncement. The said
supplementary cause list was uploaded and published on
one day earlier i.e. Thursday, 12.10.2023. My Lord is
aware that normal procedure which is being followed in
Bench of this Tribunal is that mentioning is entertained
after the pronouncement of Judgment(s)/Order(s). I am
not holding a constitutional post and as such I am required
to follow the procedure. Accordingly as per procedure
established here Judgment was pronounced on Friday
i.e.13.10.2023."
8
The statement by Dr Alok Srivastava, Member (Technical) to
the Chairperson is in the following terms:
"On 13.10.2023, when the Presiding Judge and I entered the
Court Room No II in the post-lunch session, it was jam-packed
with lawyers and there was unusually high noise in the court
room.
A total 26 cases in the Supplementary Cause List and 18 cases
in the Daily Cause List were listed under the categories "For
Judgment/For Admission (Fresh Cases)/For Admission (After
Notice)/For Orders/for Hearing" which had to be taken up in
the post-lunch session.
The practice adopted in NCLAT is to have "mentionings" after
pronouncement of judgment(s) listed in the cause list.
As the proceedings for the post-lunch session commenced, and
the "For Judgment" case CA(AT) No.64 of 2020 was called
out (as is the practice to take up "For Judgment" cases in the
beginning), some lawyers started to intervene on which the
1029
Presiding Judge commented that whatever you want to fi le,
please bring it on record.
Thereafter, the pronouncement of the said judgment was
completed.
It may be pointed out that no lawyer conveyed the judgment
orally to me during the lunch hour when I was available in my
offi ce chamber, nor copy of the said order was provided to the
Court Master. If this would have been done, the unfortunate
situation may not have arisen.
I respectfully submit that I hold the Hon'ble Supreme Court in
highest regard and esteem and there has been no intention to
disobey the order of the Hon'ble Supreme Court.
I deeply regret that such a situation arose in the matter and off er
sincere apology for the same."
9
The Member (Technical) has adverted to the events which
transpired before the NCLAT in the appeal on 13 October 2023.
Paragraph 5 of the report reads as follows:
"I have taken the response given by the Judicial Member as well
as the Technical Member. Company Appeal (AT) No.64 of 2020
was listed for pronouncement in Court No.II before the Bench
constituted of Judicial Member and Technical Member. After
the Court assembled, Learned Counsel for the parties who were
present in the Court sought to intervene to make a request to the
Bench, however, the Bench proceeded to pronounce the judgment
not permitting the mentioning by the Learned Counsels. Copy
of the order dated 13.10.2023 was not given either to the Court
Offi cer or to the Bench. The Bench did not accept the request
made on behalf of the Counsel and proceeded to pronounce the
judgment. The judgment was pronounced in ignorance of the
order of the Hon'ble Supreme Court dated 13.10.2023."
10
The report of the Chairperson has also adverted to an order
dated 16 October 2023 passed by the Bench of the NCLAT
subsequently, in the following terms:
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1030
SUPREME COURT REPORTS
[2023] 15 S.C.R.
"16.10.2023: In aforesaid appeal on 13.10.2023, Judgment was
pronounced. In the evening, the Registry brought to the notice
an e-mail dated 13.10.2023 issued at 05.35 PM addressed to
Registrar NCLAT enclosing therewith an order dated 13.10.2023,
passed by Hon'ble Supreme Court in Contempt Petition (C)
No.1195/2023 in C.A. No.6108/2023. After the order was
produced we perused the same and we noticed that Hon'ble
Supreme Court in its order in paragraph 1 sub- paragraph 6 had
directed that Judgment in pending appeal shall be delivered by
the NCLAT after it is duly apprised of the fact that the result of
Annual General Meeting has been declared.
In view of the order of Hon'ble Supreme Court it is imperative
for us to pass an order for Suspending the Judgment of this court
dated 13.10.2023 till this appellate Tribunal is duly apprised of
the fact that the result of the Annual General Meeting has been
declared or subject to order/direction passed by the Hon'ble
Supreme Court."
11
There are two affi davits before the Court at the present stage:
(i) A "limited affi davit" which has been fi led on behalf of the fi rst
respondent; and
(ii) An affi davit in rejoinder on behalf of the petitioner.
12
We have heard Mr Mukul Rohatgi, Dr Abhishek Manu Singhvi,
Mr Ranjeet Kumar, senior counsel on behalf of the petitioner
and Mr Shyam Divan and Mr Ramji Srinivasan, senior counsel
on behalf of the contesting respondents. Mr Darius Khambata,
senior counsel has appeared on behalf of the scrutinizer.
13
Mr Mukul Rohatgi, senior counsel appearing on behalf of the
petitioner reiterates, as was submitted before this Court when it
passed its order dated 13 October 2023 in the second session that
Mr Ankur Saigal, counsel appearing on behalf of the petitioner
had produced the order of this Court before the NCLAT at 2 pm
with a request that the judgment should not be delivered until the
report of the scrutinizer is made available. This was specifi cally
recorded in paragraph 3 of the order dated 13 October 2023.
1031
14
Mr Ramji Srinivasan, senior counsel appearing on behalf of the
appellant before the NCLAT has fairly stated before this Court
that the order of this Court which was passed on 13 October 2023
was duly communicated to the contesting parties. Moreover,
Mr Ramji Srinivasan also stated that at about 2.15 pm when the
Bench of the NCLAT assembled, he personally sought to tender
a copy of the order passed by this Court on 13 October 2023 in
the morning session to the Bench of the NCLAT and apprised
the Bench of the fact that this Court had specifi cally directed
that the judgment of the NCLAT shall be delivered only after
the Court was apprised of the results of the AGM. However, as
things stand, the Bench of the NCLAT proceeded to declare the
judgment. Mr Ramji Srinivasan further states that he apprised the
Bench that the representative of the petitioner herein had already
voted against the resolution at the AGM.
15
Apart from the statements which have been made by the senior
counsel before this Court, the affi davit which has been fi led by
the fi rst respondent contains the following averments:
"On 13.10.2023, the Contempt Petition was preliminary
heard by this Hon'ble Court around 12.20 pm. On
13.10.2023, passed its fi rst order on that date, which became
available at around 1.55 pm ("First Order"). This Hon'ble
Court directed Respondent No.2 to declare the result of
the AGM which was held on 29.09.2023 forthwith. This
Hon'ble Court directed that the Learned NCLAT shall
proceed to declare its judgment in the pending appeal after
it is duly apprised of the fact that the result of the AGM
has been declared.
The directions as dictated in open court by this Hon'ble
Court in the First Order were communicated to Respondent
No.1 through his Advocates at around 12.30 pm. Respondent
No.1 immediately called the Company Secretary of FCL,
to convey the directions to Respondent No.2."
16
The affi davit further states that on 13 October 2023, the report of
the scrutinizer was prepared and was sought to be uploaded on
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1032
SUPREME COURT REPORTS
[2023] 15 S.C.R.
the website of the Stock Exchanges in compliance of the order
of this Court, but as the offi cial servers of BSE Limited and
National Stock Exchange of India Limited took time to respond,
the report was uploaded at 2.41 pm and 2.44 pm respectively. The
fi rst respondent has disclosed what transpired before the NCLAT
after the order of this Court dated 13 October in the following
terms:
"At around 02.15 pm, when the NCLAT Appeal was called
out 'for judgment', the Ld. Senior Counsel representing me
informed the Learned NCLAT about the First Order and
the directions contained therein. It was also informed to
NCLAT that petitioner had voted against resolution No.4.
It was also informed that the Consolidated Scruitinzer's
Report was being uploaded. The Learned NCLAT
proceeded to pronounce the operative part of the Judgment
dated 13.10.2023 ("NCLAT Judgment"), which occurred
at around 2:15 pm. The NCLAT Judgment was only made
available on the offi cial website of the Learned NCLAT,
at 4.30 pm and it was only after that time that it was even
made public." (emphasis supplied)
17
We will fi rst deal with the report which has been submitted before
this Court by the Chairperson of the NCLAT. The Presiding Judge,
Mr Rakesh Kumar, Member (Judicial) states that the appeal was
listed for pronouncement of judgment in the supplementary cause
list which was uploaded on 12 October 2023. He states that
the normal procedure which is followed in the tribunal is that
mentioning is entertained after the pronouncement of judgments/
orders and since he is "not holding a constitutional post" as such
he is "required to follow the procedure". The Member (Judicial)
has therefore stated that "as per the procedure established here"
the judgment was pronounced on 13 October 2023.
18
The Member (Technical) on the other hand states that when the
proceedings were called out in the post-lunch session in the case
which was listed for judgment, "some lawyers started to intervene
on which the Presiding Judge commented that whatever you want
1033
to fi le, please bring it on record", after which, the pronouncement
of the judgment was made. The Member (Technical) has
tendered an unconditional apology to this Court. These facts are
conspicuously absent in the statement of the Member (Judicial).
19
Neither the statement of the Member (Judicial) nor the statement
which has been tendered by the Member (Technical) refer to the
fact that the order dated 13 October 2023 passed by this Court
in the morning session was communicated to the Bench of the
NCLAT together with the directions which were contained
therein. In paragraph 3 of the order dated 13 October 2023
passed in the afternoon session, the statement of senior counsel
appearing on behalf of the petitioner that the Bench of the NCLAT
was apprised of the order of this Court in the afternoon session
was recorded. This is also the clear case of the fi rst respondent
on affi davit since he has stated that around 2.15 pm when the
NCLAT appeal was called out for judgment, the senior counsel
representing him informed the Bench of the NCLAT of the order
which was passed by this Court earlier and the directions which
were contained therein. Neither the statement of the Member
(Judicial) nor the statement of the Member (Technical) reveals
this to the Chairperson of the NCLAT. In fact, the statement
of the Member (Judicial) would seem to indicate that no
mentioning is permitted at all before the declaration of judgment
as a consequence of which the judgment was delivered without
hearing any counsel on the order passed by this Court. Likewise,
the statement of the Member (Technical) indicates that while
some lawyers had attempted to intervene, the Presiding Offi cer
had not permitted such an intervention and had proceeded to pass
the judgment. The matter does not rest there.
20
On 16 October 2023, the Bench of the NCLAT passed an order
recording that the Registry of the Tribunal had brought to its notice
an email dated 13 October 2023 issued at 5.35 pm enclosing a
copy of the order dated 13 October 2023 passed by this Court.
The NCLAT has stated that after the order was produced, it had
perused it and noticed that this Court had issued directions to the
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1034
SUPREME COURT REPORTS
[2023] 15 S.C.R.
eff ect that judgment in the pending appeal shall be delivered by
NCLAT after it is duly apprised of the fact that the result of the
AGM is being declared. The NCLAT has proceeded to pass an
order for suspending the judgment which it pronounced on 13
October 2023.
21
We are constrained to observe that the order dated 16 October
2023 purports to create an impression that the Bench of the
NCLAT was apprised of the order passed by this Court for the
fi rst time when the email was received at 5.35 pm on 13 October
2023. This prima facie is a falsehood since it has emerged before
this Court, both on the statements of the counsel as well as on
affi davit that the Bench of the NCLAT was duly apprised of the
order passed by this Court on 13 October 2023 in the morning
session when the appeal was taken up at around 2.15 pm for
pronouncement of judgment.
22
We are, therefore, prima facie, of the view that the Members of
the NCLAT have (i) failed to disclose facts to the Chairperson
of the NCLAT who was under a duty to carry out an enquiry
in pursuance of the judicial order passed by this Court; and (ii)
incorrectly sought to create a record in the order dated 16 October
2023 that the order of this Court was drawn to the notice of the
Bench only at 5.35 pm on 13 October 2023.
23
We will deal with the consequential steps which should be taken
by this Court and the action which has to be adopted in pursuance
of what has transpired in these proceedings.
24
The manner in which the NCLAT has proceeded to deliver
judgment in defi ance of the directions of the Court is unbecoming
of a judicial tribunal. NCLAT is subject to the jurisdiction of this
Court. It was duty bound to comply with the order of this Court.
It was apprised of the fact that this Court had passed an order in
the morning session on 13 October 2023 to the eff ect that it shall
proceed to declare judgment after being apprised of the results of
the AGM. The statements made by the Member (Judicial) before
the Chairperson of NCLAT seem to indicate that he did not permit
mentioning in accordance with the practice of his Bench to the
1035
eff ect that mentioning is taken up after judgments are delivered.
The Member (Technical) indicates that while some lawyers had
sought to intervene, the Presiding Judge had not heard them.
Both these statements are belied by the fact that it is common
ground between the parties, who are seriously contesting a dispute
before NCLAT, that the Bench was dully apprised of the order
of this Court when it assembled at around 2.15 pm before the
judgment was pronounced. Moreover, the passing of the further
order on 16 October 2023 compounds the situation. If indeed the
judgment had been declared after the NCLAT was duly apprised
of the result of the AGM, there was no occasion for it to suspend
the operation of its judgment. The Members forming part of the
Bench have not purported to say so.
25
In this view of the matter, insofar as the lis is concerned, we are
of the view that it is necessary for this Court to ensure that the
dignity of the Court is maintained. A party cannot be allowed by
recourse to devious means to obviate compliance with a solemn
order passed by this Court.
26
We accordingly, in exercise of the jurisdiction under Article
142 of the Constitution, direct that the judgment of the NCLAT
dated 13 October 2023 shall stand set aside without this Court
expressing any opinion on the merits. We consequently direct
that the appeal shall be heard afresh by a Bench presided over by
the Chairperson of NCLAT. We clarify that we have not entered
any fi nding on the merits of the rival contentions of the parties in
the pending appeal. This Court has been constrained to pass this
order in extraordinary circumstances which we have referred to
above.
27
We are prima facie of the view that Shri Rakesh Kumar, Member
(Judicial) and Dr Alok Srivastava, Member (Technical) of the
NCLAT are liable to be proceeded against in the exercise of
the contempt jurisdiction of this Court. We accordingly issue a
notice to show cause to Mr Rakesh Kumar, Member (Judicial)
and Dr Alok Srivastava, Member (Technical) of the NCLAT to
show cause as to why they should not be committed under the
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1036
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Contempt of Courts Act 1971 for having willfully defi ed the
directions of this Court. They shall remain personally present
before this Court on 30 October 2023 at 10.30 am, by which
date, they shall submit their replies to the notice.
28
The scrutinizer shall fi le their explanation in response to the notice
which has been issued by this Court on or before the next date
of listing and shall remain personally present before this Court
on that day."
10 In pursuance of the above order, affi davits have been fi led before
this Court by the two members who constituted the Bench of the NCLAT and
by the Scrutiniser. We shall deal with each of these affi davits in a subsequent
part of this order.
11 Mr Mukul Rohatgi, Dr AM Singhvi, Mr Neeraj Kishan Kaul and Mr
Ranjit Kumar, senior counsel appear on behalf of the appellant. Mr Tushar
Mehta, Solicitor General of India appears on behalf of the NCLAT and the
Member (Technical). Mr PS Patwalia, senior counsel appears on behalf of
the Member (Judicial). Mr Darius Khambata, senior counsel appears on
behalf of the Scrutiniser.
12 An affi davit has been fi led by the Member (Technical) unconditionally
tendering an apology before this Court. The Member (Technical) has,
inter alia, stated that control over the procedure during the course of the
proceedings before the Bench, particularly the procedure of mentioning,
is with the Member (Judicial) on account of his judicial training and
experience in the functioning of the courts. The Member (Technical) has
stated that on 13 October 2023, when the Presiding Judge and he entered
the courtroom in the post-lunch session, the courtroom was overcrowded
with an unusually large number of advocates. Once the mentioning process
was over, the Member (Judicial) asked him to pronounce the judgment
which he thereafter proceeded to pronounce. It has been stated that none
of the advocates from any of the parties made any eff ort to bring on record
and place before the Bench on 13 October 2023 the actual order which was
passed by this Court in the pre-lunch session and that it was much after the
pronouncement of the judgment in the post-lunch session at around 6.27
p.m. that the NCLAT Registry received an email containing a copy of the
order after the proceedings for the Tribunal had been concluded for
1037
the day. The Member (Technical) has referred to the CCTV footage
of the proceedings of the NCLAT and to a pen drive which has been
received.
13 The Member (Judicial), on the other hand, has fi led an affi davit
in which the following averments appear in Paragraph 10 :
"10 ... The bench presided by the deponent and the Technical
Member Shri Alok Shrivastava assembled a few minutes
after 2 PM, at about 2.05 PM, on 13.10.2023, when some
counsel tried to mention the matter. However, neither any
order of this Hon'ble Court was fi led with the Registry
or Court Maste3r nor was any order even handed over to
the bench by the parties before assembling of the bench.
Rule 38 of NCLAT Rules, 2016 authorises the parties or
their authorised representatives to furnish any document
to the Court Master which he wishes to place on record for
reference by the Bench, before the commencement of the
proceedings for the day. However, no such attempt was even
made by the counsel of either of the parties."
14 Paragraphs 13 and 14 of the affi davit of the Member (Judicial)
are set out below :
"13 That it is further submitted that the procedure followed
in the NCLAT, like in this Hon'ble Court and many other
courts is that when a matter is listed for pronouncement of
judgment, mentioning by counsel for any case is permitted
only after pronouncement of judgment and not before that.
Following that practice, the deponent did not entertain any
attempt at mentioning by the counsel and thereafter the
Technical Member proceeded to pronounce the judgment
authored by him.
14 That it is reiterated that the copy of the order dated
13.10.2023 passed by this Hon'ble Court was not on record
before the bench presided by the deponent on 13.10.2023.
Had the said order been brought on record as per procedure
before the bench presided by the deponent, there is no doubt
that the bench would not have pronounced its judgment."
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1038
SUPREME COURT REPORTS
[2023] 15 S.C.R.
15 The Member (Judicial) states that a copy of the order dated 13
October 2023 was brought before him for the fi rst time after 5:35 PM on
13 October 2023 when it was received by the Registrar of the NCLAT
by email.
16 During the course of the hearing, the Solicitor General has
produced a copy of the authenticated CCTV footage of the actual hearing
which took place before the NCLAT on 13 October 2023 in the course
of the afternoon session. The CCTV footage has been played twice in
the Court for being seen and heard by all present in the open Court. A
transcript of the proceedings has also been tendered by the Solicitor
General. During the course of the hearing, since the CCTV recording
was replayed twice, we have had the occasion to tally the transcript
which has been tendered with the video recording of the proceedings.
The transcript which has been tendered by the Solicitor General is set
out below in its entirety :
"Transcript of conversation and exchanges in Court Room-II,
NCLAT in post-lunch session on 13.10.2023
Note:
(1) Clock of CCTV is about 27 minutes ahead of the actual time.
Times given below are actual times.
(2) There were approximately 85-90 persons inside the Court
Room-II at the beginning of post lunch session at 02:07 PM
(actual time) on 13.10.2023.
(3) Mr Ramji Srinivasan, Sr. Advocate entered the Court Room at
13:51 hrs and Mr. Krishnendu Dutta, Sr. Advocate entered at
13:53 hrs.
(4) The proceedings in Court-II began at 14:06:50 hrs with the
entry of bench members in the court room and concluded in
the matter at 14:30 hrs.
1039
Mr Ramji
Srinivasan
May I mention, with your Lordships permission,
before Your Lordship proceeds to pronounce the
judgment My Lords in the Orbit matter, I must
apprise your Lordships of a further development
that has happened. My Lords the matter was heard
by the Supreme Court My Lords in a contempt
petition fi led by the other side. Your Lordships
recollect Your Lordships had reserved the order.
Justice Rakesh
Kumar
Not clear
Mr. Ramji
Srinivasan
My Lords I am bound by the order, the order of the
Supreme Court My Lords. All that it says is this
just so that Your Lordships My Lords. This has
nothing to do with Your Lordships pronouncing
the order. But this was what was directed that
we must apprise your Lordships before Your
Lordships pronounce the order today that the
Supreme Court had passed an order saying that
any declaration My Lords the action taken will
be subject to outcome of the appeal. So My Lords
the voting had taken place. The scrutinizer had
withheld the result of resolution board subject to
outcome whatever. We had taken some opinion
of some judges. Therefore, he took the advice
and said that I will withhold. The other side
went up in contempt and moved an application
before the Hon'ble Supreme Court saying that
the scrutinizer should not have withheld result
subject to outcome, whatever be the result,
whether Mr. Chabaria was to continue or not, that
should be declared but Your Lordships should not
pronounce. The Hon'ble Supreme Court today
now said that Your Lordships can pronounce
the judgment and I must apprise Your Lordships
before Your Lordships pronounce. That's all.
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1040
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Hon'ble Justice
Rakesh Kumar
Nothing is before us on record...(not clear)
allow us to pronounce judgment.
Mr. Ramji
Srinivasan
Apprise Your Lordship. I will just read, nothing
else. May I just show the order passed by the
Hon'ble Supreme Court.
Hon'ble Justice
Rakesh Kumar
Just a minute. There is no point... (not clear)
Mr. Krishnendu
Dutta
No no no... (cross talk, not clear)... Hon'ble
Supreme Court says order may be pronounced
only after results are eclared, thats the order of
Hon'ble Supreme Court.
Hon'ble Justice
Rakesh Kumar
Neither any order has been official
communicated to us.
Mr. Krishnendu
Dutta
(interjecting) It was passed this morning.
Hon'ble Justice
Rakesh Kumar
(continuing) nor it has been passed, nor it has
been mentioned before us. We have reserved the
judgment, we are pronouncing it.. you can go to
the Supreme Court.
Mr. Ramji
Srinivasan
(Cross talk, not clear) my friend is misstating
the order. It only says that Lordships have to be
apprised of the order... that's all.
Hon'ble Justice
Rakesh Kumar
We are not taking cognizance of anything. The
case is listed under the caption 'for orders' we
are pronouncing it... If you think that we are
passing order in violation of the Supreme Court
order, you go and complain (not clear).... Allow
us to pass the order.
Mr. Krishnendu
Dutta
No its not that. Hon'ble Supreme Court has
passed an order this morning, it is my duty to
place it before you (he does not tender copy of
the order)
Justice Rakesh
Kumar
Whatever you want to bring on record, do so
through affi davit.
1041
Court Master
Calls out Item 1, For Judgment - Company
Appeal (AT) No. 64 of 2020.
Dr Alok
Srivastava
(pronounces the judgment in CA (AT) 64 of 2020)
Senior Lawyers
Mr
So deeply obliged...."
17 The above transcript of the proceedings together with the video
recording which has been produced before the Court leaves no manner of
doubt that :
(i)
The Bench of the NCLAT was duly apprised of the fact that an
order had been passed by this Court in the morning session on
13 October 2023;
(ii) The Scrutiniser had withheld the result of the AGM; and
(iii) The purport of the order of this Court dated 13 October 2023
was that the NCLAT shall pronounce judgment in the pending
appeal after the results of the AGM were declared.
18 The transcript indicates that both Mr Krishnendu Dutta (senior
counsel) and Mr Ramji Srinivasan (senior counsel) appearing on behalf of
the contesting parties had apprised the Bench of the NCLAT of the order
of this Court. The CCTV footage makes it abundantly clear that both the
counsel had a copy of the order of this Court and made an eff ort to read
out the order. The Member (Judicial), however, stated that no copy of the
order "has been offi cially communicated to us". The Member (Judicial) also
observed that since the NCLAT had reserved judgment, it was proceeding to
pronounce the judgment and the appellants (represented by their counsel Mr
Krishnendu Dutta) "can go to the Supreme Court". The Member (Judicial)
stated that "if you think that we are passing order in violation of the Supreme
Court order, you go and complain". The parties were directed to place on
affi davit anything that they wish to bring on the record.
19 From the CCTV footage as well as from the transcript, it is evident
beyond a shadow of doubt that though the NCLAT was duly apprised of the
fact that this Court had in the morning session on 13 October 2023 passed
an order to the eff ect that the judgment shall be pronounced only after the
ORBIT ELECTRICALS PRIVATE LIMITED v.
DEEPAK KISHAN CHHABRIA & ORS.
1042
SUPREME COURT REPORTS
[2023] 15 S.C.R.
results by the Scrutiniser are declared, the Bench of the NCLAT declined to
pay heed to the order of this Court. The Member (Judicial) has referred in his
affi davit to the Rules governing procedure in the NCLAT, more particularly,
Rules 38, 101 and 102 which read as follows :
"38.