Settlement Commission jurisdiction and review limits clarified: no exclusive control before admission, and contempt needs clear disobedience.

An application before the Settlement Commission does not oust writ jurisdiction unless the Commission first allows the application to proceed under section 245D(1); until then, section 245F(2) does not confer exclusive jurisdiction. Review lies only for an error apparent on the face of the record or an equivalent patent defect, and a mere allegation that the earlier decision was wrong on merits is insufficient. On the contempt issue, clear disobedience of the stay order must be shown; the court found no such disobedience in relation to encashment of the bank guarantee and rejected the contempt claim.

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Issues: (i) Whether the review petition disclosed any error apparent on the face of the record or any grave and palpable error warranting interference with the earlier order, and whether the filing of an application before the Settlement Commission ousted the jurisdiction exercised in the writ proceedings; (ii) whether any contempt was made out for alleged disobedience of the stay orders concerning encashment of the bank guarantee.

Issue (i): Whether the review petition disclosed any error apparent on the face of the record or any grave and palpable error warranting interference with the earlier order, and whether the filing of an application before the Settlement Commission ousted the jurisdiction exercised in the writ proceedings.

Analysis: The jurisdiction of the Settlement Commission under the statutory scheme begins only after it allows the application to be proceeded with under section 245D(1); until then, section 245F(2) does not confer exclusive jurisdiction. Since no order had been passed by the Settlement Commission to proceed with the application, the earlier order was not inconsistent with the statutory provisions. The review jurisdiction could be invoked only for error apparent or analogous grounds, not merely because the decision was said to be erroneous on merits, and no such patent error was shown.

Conclusion: The challenge in review failed and the order under review was sustained.

Issue (ii): Whether any contempt was made out for alleged disobedience of the stay orders concerning encashment of the bank guarantee.

Analysis: The court treated the factual controversy regarding the demand draft and the bank guarantee as immaterial to the existence of disobedience and found that, on the circumstances, no contempt had been established against the respondents.

Conclusion: No contempt was made out and the contempt application was dismissed.

Final Conclusion: The review petition and the connected application both failed, and the limited extension of time granted for furnishing renewed bank guarantees did not alter the ultimate dismissal of the proceedings.

Ratio Decidendi: An application for settlement does not create exclusive jurisdiction in the Settlement Commission until it is permitted to proceed, and review will not lie absent a patent error apparent on the face of the record; contempt requires clear disobedience of the court's order.

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