Disposed

Shri Narendra Kumar v. Shri Ashok D R

Karnataka HC14 Aug 2024CCC/594/2022

Case brief

AI extract

What is this about?

Civil contempt petition alleging non-compliance by competent authorities with interim directions to process depositors' claims under the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004. Compliance affidavits showed authorities had taken required steps. Finding no willful contempt, the court closed the proceedings.

What the court decided

AI extract

Shri Narendra Kumar Vs Shri Ashok D R — Contempt of Court | Karnataka HC (2024)

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NC: 2024:KHC:32787-DB CCC No. 594 of 2022

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 14^TH DAY OF AUGUST, 2024

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PRESENT

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THE HON'BLE MR. N. V. ANJARIA, CHIEF JUSTICE

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AND

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THE HON'BLE MR. JUSTICE K. V. ARAVIND

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CIVIL CONTEMPT PETITION NO. 594 OF 2022

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BETWEEN:

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SHRI NARENDRA KUMAR, S/O LATE KASHINATH PANDEY, AGED ABOUT 58 YEARS, RESIDING AT No.9, 6^TH CROSS, SINGAPURA LAYOUT, VIDYARANYAPURA POST, BENGALURU-560097.

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…COMPLAINANT

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(BY SRI NARENDRA KUMAR, COMPLAINANT-IN-PERSON)

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AND:

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Digitally signed by VALLI MARIMUTHU Location: High Court of Karnataka

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SHRI ASHOK D. R., THE JOINT SECRETARY, OFFICE OF SPECIAL OFFICER FOR IMA AND OTHER SCAMS, 3^RD FLOOR, PODIUM BLOCK, VV TOWERS, BENGALURU 560001. THE COMPETENT AUTHORITY FOR AMBIDANT – RESPONDENT No.11 AJMERA – RESPONDENT No.12 (IN WP No.31624/2019)

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SHRI SUBRAMANYA SN, THE ASSISTANT COMMISSIONER, OFFICE OF SPECIAL OFFICER FOR

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IMA AND AOTHER SCAMS, 3^RD FLOOR, PODIUM BLOCK, V V TOWERS, BENGALURU-560001. THE COMPETENT AUTHORITY FOR INJAZ- RESPONDENT No.13 (IN WP No.31624/2019)

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SMT. ASHA PRAVEEN, ASSISTANT COMMISSIONER, HOUSE RENT CONTROLLER, 3^RD FLOOR, KANDAYA BHAVAN, K.G. ROAD, BENGALURU-560009. THE COMPETENT AUTHORITY, FOR MUZARIBAH-RESPONDENT No.14 (IN WP No.31624/2019)

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SHRI AMALAN ADITYA BISWAS, COMPETENT AUTHORITY FOR IMA AND OTHER SCAMS, 3^RD FLOOR, PODIUM BLOCK, V V TOWERS, BENGALURU-560001. THE COMPETENT AUTHORITY, FOR AALA - RESPONDENT No.15 (IN WP No.31624/2019)

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SMT. ARATI ANAND, THE SPECIAL DEPUTY COMMISSIONER, BEHIND KANDAYA BHAVAN, K.G. ROAD, BENGALURU-560009, THE COMPETENT AUTHORITY, FOR BURRAQ - RESPONDENT No.17 HEERA - RESPONDENT No.25 (IN WP No.31624/2019)

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SHRI ARALI SURYAKANTH, THE MANAGING DIRECTOR AND ADDITIONAL REGISTRAR, CO-OPERATIVE SOCIETIES, KARNATAKA CO-OPERATIVE FEDERATION, CHAMARAJPET, BENGALURU-560018. THE COMPETENT AUTHORITY, FOR MORGENALL - RESPONDENT No.18 (IN WP No.31624/2019)

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SHRI SHIVAKUMAR K. R., THE DEPUTY CONTROLLER OF FINANCE, RERA, 3^RD CROSS, SAMPANGIRAM NAGAR, BENGALURU 560002. THE COMPETENT AUTHORITY, FOR NAFIYA - RESPONDENT No.19 (IN WP No.31624/2019)

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SMT. MEENA NAYAK S., THE JOINT REGISTRAR, CO-OPERATIVE SOCIETIES, BMTC BUILDING, KH ROAD, BENGALURU-560027. THE COMPETENT AUTHORITY, FOR TIFORP - RESPONDENT No.26 (IN WP No.31624/2019)

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SMT. VANDANA BHAT, THE CHIEF ADMINISTRATIVE OFFICER, HEALTH DEPARTMENT, MAGADI ROAD, BENGALURU-560023. THE COMPETENT AUTHORITY, FOR DREAMZ - RESPONDENT No.33 (IN WP No.31624/2019)

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SHRI TEJAS KUMAR, THE ASSISTANT COMMISSIONER, DODDABALLAPUR SUB-DIVISION, BENGALURU RURAL, DODDABALLAPUR, BENGALURU-561203. THE COMPETENT AUTHORITY, FOR YELLOW-EXPRESS - RESPONDENT No.31 (IN WP No.31624/2019)

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SHRI AMALAN ADITYA BISWAS, SPECIAL OFFICER AND COMPETENT AUTHORITY, FOR IMA AND OTHER SCAMS, 3^RD FLOOR, PODIUM BLOCK, V V TOWERS, BENGALURU-560001.

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…ACCUSED

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THE STATE OF KARNATAKA, REPRESENTED BY ITS CHIEF SECRETARY,

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GOVERNMENT OF KARNATAKA, VIDHANA SOUDHA, BENGALURU-560001.

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... PROFORMA RESPONDENT

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(BY SRI VEERESH R. BUDIHAL, ADVOCATE FOR A1 TO 3 & 11; SRI MOHAMMED JAFFAR SHAH, AGA FOR R8 TO R10; RESPONDENTS 5 TO 7 ARE SERVED AND UNREPRESENTED)

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THIS CCC IS FILED UNDER ARTICLE 215 OF THE CONSTITUTION OF INDIA R/W SECTIONS 11 AND 12 OF THE CONTEMPT OF COURTS ACT, 1971, BY THE PARTY-IN-PERSON (COMPLAINANT), PRAYING TO HOLD THE ACCUSED Nos.1 TO 11 FOR NOT COMPLYING AND WILLFULLY DISOBEYING THE ORDERS OF THIS HON’BLE COURT WHICH WERE PASSED IN WP No.31624/2029(PIL) IN ORDER DATED 29.07.2021 (PRODUCED HEREWITH AND MARKED AS ANNEXURE-A)

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THIS CCC COMING ON FOR ORDERS THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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CORAM: HON'BLE THE CHIEF JUSTICE MR. JUSTICE N. V. ANJARIA

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and

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HON'BLE MR. JUSTICE K. V. ARAVIND

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ORAL ORDER

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(PER: HON'BLE THE CHIEF JUSTICE MR. JUSTICE N. V. ANJARIA)

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The contempt jurisdiction of this Court under the Contempt of

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Courts Act, 1971 is sought to be invoked in respect of the directions passed by learned Single Judge in the order dated 29.07.2021. It is an interim order passed in the pending Writ Petition No.31624 of 2019, which was filed as a public interest petition.

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NC: 2024:KHC:32787-DB CCC No. 594 of 2022

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Today when the contempt proceedings came up for consideration, learned advocate Mr. Veeresh R. Budihal for the respondents placed on record memo dated 14.08.2024.

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2.1 The memo reads as under,

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“ The undersigned counsel for the respondent No. 1 to 4 submits that the petitioner (Party in person), is collecting money from the gullible depositors under the nomenclature "Donations" and is addressing the depositors on YouTube platform and is asking the depositors to pay the money to him.

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It is further submitted that, the respondents herein have noticed the said YouTube clipping and crave the leave of this Hon'ble Court to produce herewith the still photographs of the said video clipping with the sub titles as presented in the said YouTube clipping by the petitioner himself and the same may kindly taken on record which establish that the petitioner herein is playing victim politics and extorting / raising funds from the gullible depositors of various fraudulent financial establishments.

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This Hon'ble Court may kindly be pleased to peruse the screenshots obtained from the YouTube clippings in the interest of justice and equity.”

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2.2 From the contents of the memo and from the photographs of the video clipping attached to the memo, what was sought to be submitted was that the party-in-person, who is public interest petitioner, has been acting far from bona fides by collecting money

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from the depositors to run the present proceedings and thereby motivates the personal gains also.

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2.3. Responding to this, the party-in-person Mr.Narendra Kumar stated that he was collecting only donations and that the depositors have been willingly giving the money.

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2.4. The aspect demonstrated through filing of the memo as above would go to the root of the locus of the petitioner, if it to be probed to its logical end. However, the Court is not inclined to go into at this stage leaving the said issue and aspect open to be raised and agitated at any other appropriate stage, since the Court is inclined to take up the merits of the main contempt petition itself.

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It is mainly the following directions in the aforementioned interim order dated 29.07.2021 which are complained of for their non-compliance, extracting from paragraphs 5 and 6 of the order,

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“5. We direct the competent authorities to process the claims within a period of three months from today in the cases where the claims under sub-section (2) of Section 7 of the said Act of 2004 have been received. In those cases where the claims have been invited under sub-section (2) of Section 7, but the exercise of filing a report under subsection (1) of Section 7 has not been complied with, the same shall be complied with within a period of six weeks from today. In those cases, where claims have not been invited under sub-section (2) of Section 7, immediate steps shall be taken to do so. We make it clear that in those

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cases where the claims have been received, the verification has to be done expeditiously so that after making adjudication, the Special Court can pass an order, if any, for payment of the requisite amounts to the investors.

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The report of the Deputy Commissioner of Police, East Division, Bengaluru, shall be resealed and kept on the record. The State Government shall file a compliance report of the competent authorities on all aspects by 3^rd September, 2021”

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3.1 The aforesaid directions in the interim order came to be passed in writ petition which relate to the alleged nonimplementation and mal-implementation of the provisions of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 (KPIDFE Act). The petition has been filed by seven petitioners of whom, petitioner No.1 appears as a party-in-person. The respondents are the competent authorities under the KPIDFE Act as well as the entities who are private financial establishments with whom the depositors invested money to be regulated by the provisions of the aforesaid Act.

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3.2. Several prayers are advanced in the public interest petition. Noticing the few, the direction is sought against respondent No.2the Additional Chief Secretary, Home Department, Government of Karnataka, to identify all assets and properties including Benami

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transactions of the respondents concerned who are the Managing Directors and the Directors and to hold them under the KPIDFE Act.

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3.3. Further direction is prayed for to take steps against the absconding respondent Nos.17 and 18 who are the Directors and Managers of the private financial establishments. The prayers are also made to seek action under the KPIDFE Act and to initiate inquiry against the responsible persons and officers of the private financial establishments who have allegedly violated the provisions of the KPIDFE Act to the detriment of several depositors. The party-in-person stated that there are about one lakh depositors. Be that as it may.

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In the present contempt proceedings, the respondents filed their affidavits of compliance pointing out in detail the steps and the measures taken to process the claims in compliance of the directions of this Court.

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4.1. While the compliance affidavits figure on record, it would be suffice to notice the contents of the latest affidavits dated 05.04.2024 and 23.07.2024. Both the affidavits are filed by one

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Amlan Aditya Biswas who is the Special Officer and competent authority under the KPIDFE Act for dealing with such cases.

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4.2 From the contents of the affidavit dated 05.04.2024, the following main aspects about the steps taken could be figured out,

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(i) The competent authority issued communication to all the authorities concerned on 19.03.2024 directing them to file the latest action taken report/summary of the action taken in the matter of each financial establishment,

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(ii) The competent authorities have submitted to the office of the deponent the action taken report/summary of the action taken by them in the respective financial establishment of which they have been appointed,

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(iii) The reports are called for to be submitted by each of the competent authority of the respective financial establishment and these reports are produced along with the affidavit.

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The competent authorities concerned have been filing

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periodical reports before the Special Court which is seized of different cases relating to the grievances of the investors. Various status reports mentioned in the affidavits are attached as annexures which give in detail information about the measures and the steps taken by the competent authorities. With the help of learned advocate Mr. Veeresh R. Budihal for the respondentsauthorities, the Court could go through the salient aspects of the said status reports.

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5.1. The last affidavit dated 23.07.2024 mentions that the competent authority/deponent had given necessary instructions to various authorities under him to provide details regarding the auction of the properties and also about the details of the Notifications under Sections 3(2) and 5(2) of the said Act, the number of properties subjected to interim attachment, the details of properties auctioned etc. Such reports have been submitted by them to the office of the deponent.

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5.2 The reports enclosed with the affidavits suggest that all possible actions were taken under the KPIDFE Act in compliance of the directions of the Court which is the subject matter of the

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present contempt proceedings. As requested in the affidavits, the respective competent authorities have been filing periodical reports regularly before the Special Court relating to the progress of the cases in relation to financial establishments.

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5.3. It is not possible to say that the respondents-authorities are not alive to the interim directions passed by the Court. The competent authority has acted in the direction and have been continuously monitoring. The Special Court seized with the cases has been dealing with the investors’ grievances.

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5.4. In view of the above and the contents of the different affidavits filed on record including the aforesaid last two affidavits, the Court is of the view that it could not be said that any of the respondents-authorities have committed contempt of the Court, much less a willful contempt. Therefore, the contempt proceedings are required to be closed.

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5.5 Even otherwise, the order brought under the contempt jurisdiction is the interim order. When the main petition is pending at large, the complainant will have the right to agitate his case in accordance with law on all counts as may be available in law.

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6 While dropping the contempt proceedings at this stage, it is provided that the respondents-authorities shall continue to monitor the cases in compliance with the interim directions of this Court in the order dated 29.07.2021 and that the competent authority shall continue to abide by the provisions of the KPIDFE Act in taking steps and measures as may be required in the subject matter.

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