TaxTMI 
TaxTMI 
1988 (9) TMI 340
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....tiation of contempt proceedings against the proprietors of Indian Express Newspapers Bombay Pvt. Ltd., Shri Arun Shourie, Indian Express Newspapers Bombay Pvt. Ltd., Shri Hari Jaisingh, Resident Editor, Indian Express Newspapers Bombay Pvt. Ltd., Shri A.C. Saxena, News Editor, Indian Express Newspaper Pvt. Ltd., Delhi, Shri H.K. Dua, Chief, New Delhi Bureau, Indian Express Newspaper Pvt. Ltd., New Delhi, and Shri V. Ranganathan, Indian Express Bombay Pvt. Ltd. The petition was moved on behalf of Reliance Petrochemicals Ltd. (hereinafter called "Reliance Petrochemicals"). It was stated therein that this Court should take cognisance of the contempt alleged to have been committed by the respondents and it was further prayed that pending the consideration of the question of criminal contempt, this Court should pass an order restraining the Express Group of Newspapers and their related publications from publishing any materials or articles in relation to the subject matter of the proceedings in the Transfer Petitions Nos. 192 and 193 of 1988 which was sub-judice issue in Writ Petition No. 1276 of 1988 in Karnataka High Court, Writ Petition No. 1791 of 1988 in Delhi High Court, Writ Peti....
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....plication for transfer of these proceedings under Article 139A of the Constitution of India read with Part IV-A of the Supreme Court Rules 1966 was moved by Reliance Petrochemicals Ltd. against the Union of India, Controller of Capital Issues and the petitioner in the suit in Bangalore and writ petition in Delhi. It was stated that the Certificate of Incorporation was granted to the petitioner on or about 11th January, 1988 and the Certificate of Commencement of Business was granted on 21st January, 1988. On 4th May, 1988 an application was made to the Controller of Capital Issues for raising Equity Share Capital/Cumulative Convertible Preference Shares/Convertible Debentures for financing the proposed projects for manufacture of PVC HDPE and MEG. On 4th July, 1988, as mentioned before, the consent of the Controller of Capital Issues was granted to the petitioner for capital issue of 5,75,00,000 Equity Shares of Rs. 10 cash inclusive of retainable excess subscription of Rs.7.5 crores and for 2,96,70,000 12.5 per Secured Fully Convertible Debentures of Rs.200 each for cash at par to public. It is not necessary for the present purpose to set out the details of the same. It is stated ....
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....with, without let or hindrance, notwithstanding any proceedings instituted or that may be instituted in or before any Court or tribunal or other authority. Any order direction or injunction of any Court, tribunal or authority in any proceeding already passed or which may be passed will by operation of this order be and remain suspended till further orders of this Court. In substance the order was that the issue be proceeded with "without let or hindrance". notwithstanding any proceedings instituted or that may be instituted in or before any Court or tribunal or other authority. This Court vacated all orders of injuction in respect of the said issue. It was asserted on behalf of the petitioner that this Court must have been prima facie satisfied that there was no legal infirmity which should stand in the way of the public issue of the said debentures going through and further, in any event, must have been satisfied that there should not be any let or hindrance to the said public issue. The petitioner had drawn our attention to an article published on 25th August, 1988, under the heading "Infractions of Law has Unique Features RPL Debentures". It is not necessary for the present pur....
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.... on 25th August, 1988. Attention of the Court was drawn to an article proposed to be published in the Indian Express which was Annexure 'B' to the said affidavit. Submissions were made on the validity or the propriety of the interim order. Upon hearing learned counsel for both the parties, this Court observed that it was sufficient to say that the article proposed to be published and forming part of Annexure 'B' did not violate the order of injunction passed by this Court on 25th August, 1988. In other words, this Court was of the view that the article in question which was intended to be published and shown to this Court on 26th August, 1988 did not question the legality or the validity of the order which was in issue in the proceedings in this Court. In those circumstances no question of variation or vacation of the said interim order arose. The said article proposed at that time has since been published before 31st August, 1988. It was stated in the affidavit as well as in the submissions made from the Bar that the shares have been over-subscribed but the day of allotment, of course, has not yet expired and before the allotment the subscribers, it was submitted, could withdraw t....
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....tection of certain rights regarding freedom of speech, etc.--(l) All citizens shall have the right (a) to freedom of speech and expression; (b) to assemble peaceably and without arms; (c) to form association or unions: [d] to move freely throughout the territory of India; (e) to reside and settle in any part of the territory of India; (f) [Omitted by ibid. Sub-cl. [f] read to acquire, hold and dispose of property; and ) [g] to practise any profession, or to carry on any occupation, trade or business. (2) Nothing in sub-clause (a) of clause (I) shall affect the operation of any existing law, or prevent the State from making any law, in so far as such law imposes reasonable restrictions on the exercise of the right conferred by the said sub-clause in the interests of (the sovereignty and integrity of India,) the security of the State, friendly relations with foreign States, public order, decency or morality or in relation to contempt of court, defamation or incitement to an offence." The effect of Article 19 on the freedom of Press, was analysed in the decision of this Court in Express Newspapers (Pvt) Ltd. & Anr. v. The Union of India & Ors., [1959] SCR 12, where at page 120 ....
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....er broadcast a speech seeking to justify the propriety of the order. The High Court a Rule requiring the Chief Minister to show cause why he should may be committed for contempt of Court. The High Court found him guilty of contempt and fined him. The matter came up before this Court and the conviction was upheld. It was held that the speech was ex facie calculated to interfere with the administration of justice. This Court reiterated that in all cases of comment on pending proceedings, the question is not whether the publication did interfere, but whether it tended to interfere, with the due course of justice. The question is not so much of the intention of the contemnor as whether it is calculated to interfere with the administration of justice. But for the instant case this decision cannot be of much assistance. Firstly, the contents of the speech of the Chief Minister were entirely different. The Chief Minister in his speech had characterised the preparation of any food with milk product as amounting to a crime. There was a tendency in the speech of the Chief Minister of intimidating the litigants or the potential litigants in respect of the issue pending in the Court. In the i....
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....m requiring the licensing of broadcasting, television or cinema enterprise. (2) The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security, territorial integrity or public safety, for the prevention of disorder or crime, for the protection of health or morals, for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence, or for maintaining the authority and impartiality of the judiciary." The First Amendment to the Constitution of the U.S.A provided as follows: "Amendment--1 Congress shall made nO law respecting an establishment of religion, or prohibiting the tree exercise thereof; or abridging the freedom of speech or of the press; or the right of the people peaceably to assemble. and to petition the Government for a redress of grievances." Keeping the constitutional requirements of the Indian law in the background, it would be appropriate to refer to....
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....ankfurter further reiterated that the dependence of society upon an unswered judiciary is such a common place in the history of freedom that the means by which it is maintained are too frequently taken for granted without heed to the conditions which alone make it possible. ( Emphasis supplied). The role of Courts of justice in our society has been the theme of statesmen and historians and constitution makers, and best illustrated in the Massachusetts Declaration of Rights as the right of every citizen to be tried by Judge as free, impartial and independent as the lot of humanity will admit. Justice Frankfurter dissenting in his Judgment with whom Justice Stone, Justice Roberts and Justice Byrnes agreed, reiterated at page 284 of the report that the Constitution is an instrument of Government and is not conceived as a doctrinaire document, nor was the Bill of Rights intended as a collection of popular slogans. It is well to remember that Justice Frankturter recognised that we cannot read into the 14th Amendment the freedom of speech and of the Press protected by the 1st Amendment and at the same time leave out the age old means employed by States for securing the calm course of ju....
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....s, a balance of convenience in the conventional phrase of Anglo-Saxon Common Law Jurisprudence would, perhaps be the proper test to follow. In this background it would be appropriate to refer to some of the English decisions to which our attention was drawn. Mr. Jethmalani relied on the observations of Lord Denning in the Court of Appeal in Attorney General v. British Broadcasting Corpn., [1979] 3 AER 45, where the Master of Rolls Lord Denning characterised some of these similar type of injunctions as "gagging injunctions". Mr. Baig, however, protested that in view of the terms in which the injunction was issued in the instant case, the order did not "gag" anything that was legitimate. The House of Lords, however, did not approve the observations of Lord Denning. We may refer to the observations of the House of Lords in Attorney General v. B.B.C., [1981] AC 303, wherein the Attorney General brought proceedings for an injunction to restrain the defendants from broadcasting a programme dealing with matters which related to an appeal pending before a local valuation court on the ground that the broadcast would be a contempt of court. The Divisional Court of the Queen's Bench Division,....
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....s. Nevertheless it should, I think, be recognised that a man may not be able to put that which he has seen, heard or read entirely out of his mind and that he may be subconsciously affected by it. As Lord Denning M.R. said the stream of justice must be kept clean and pure. It is the law, and it remains the law until it is changed by Parliament that the publication of matter likely to prejudice the hearing of a case before a court of law will constitute a contempt of court punishable by fine or imprisonment or both. In this appeal we do not have to pronounce on whether the proposed broadcast would have prejudicially affected the hearing before the local valuation court. Although it clearly was likely to have aroused hostility to the Exclusive Brethern, it by no means follows that it would have prejudiced their claim to relief from rates. The mere assertion in the course of-the broadcast that they were not entitled to that relief was in my view unlikely to have affected in any way a decision on whether their meeting room was a place of Public religious worship coming within section 39." Lord Edmund-Davies at page 354 of the report emphasised that only a very short question arose, n....
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....round that it would be a contempt of court. After the grant of the injunction on November 17, 1972, and while the newspaper's appeal was pending, the thalidomide tragedy was on November 29 debated in Parliament and speeches were made and reported which expressed opinions and stated facts similar to those in the banned article. Thereafter, there was a national campaign in the press and among the general public directed to bringing pressure on the company to make a better offer for the children and their parents; and the company in fact made a substantially increased offer. The Court of Appeal having discharged the injunction. the Attorney-General appealed to the House of Lords. It was held that the contempt of court to publish material which prejudged the issue of pending litigation or was likely to cause public prejudgement of that issue, and accordingly the publication of this article, which in effect charged the company with negligence, would constitute a contempt, since negligence was one of the issues in the litigation. The House of Lords granted injunction prohibiting the Times Newspaper from publishing the proposed publication. Reference was made to Oswald's Contempt of Cour....
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....sp; "I think that anything in the nature of prejudgment of particular case or of specific issues in it is objectionable, not only because of its side effects on that particular case but also because of its side effects which may be far reaching. Responsible "mass media" will do their best to be fair, but there will also be ill-informed, slapdash or prejudiced attempts to influence the public. If people are led to think that it is easy to find the truth, disrespect for the processes of the law could follow, and, if mass media are allowed to judge, unpopular people and unpopular causes will fare very badly. Most cases of prejudging of issues fall within the existing authorities on contempt. I do not think that the freedom of the press would suffer; and I think that the law would be clearer and easier to apply in practice if it is made a general rule that it is not permissible to prejudge issues in pending cases." (Emphasis supplied) Lord Diplock stated at page 309 of the report that the due administration of justice requires first that all citizens should have unhindered access to the constitutionally established courts of criminal or civil jurisdiction for the det....
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....es, whether of fact or of law, in pending proceedings--whether civil or criminal--is in principle an interference with the administration of justice although in any particular case the offence may be so trifling that to bring it to the notice of the court would be unjustifiable." Mr. Baig emphasised that there is an inherent jurisdiction to restrain by injunction any publication that interferes with a fair trial or a pending case or with the administration of justice in general. He further urged that trial of newspaper in sub judice matter is wrong. Publication is permissible provided it does not amount to prejudgment or prejudice of a matter in Court. Liberty or freedom of Press must subserve the due administration of justice. He submitted that there is need to continue the injunction because contribution to the debentures could be withdrawn as the final allotment has not yet been made. On the other hand, Mr. Diwan submitted that there is no jury trial involved here and no likelihood of the trial being prejudiced because trial is by professionally trained Judges. Public have a right to know about this issue of debentures which is a matter of public concern. It affects the public ....
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....rest demands that there should be no interference with judicial process and the effect of the judicial decision should not be pre-empted or circumvented by public agitation or publications. It has to be remembered that even at turbulent times through which the developing countries are passing, contempt of court means interference with the due administration of justice. In the peculiar facts of this case now that the subscription to debentures has closed and, indeed, the debentures have been over-subscribed, we are inclined to think that there is no such imminent danger of the subscription being withdrawn before the allotment and as to make the issue vulnerable by any publication of article. On a balance of convenience, we are of the opinion that continuance of injunction is no longer necessary. In this peculiar situation our task has been difficult and complex. The task of a modern Judge, as has been said, is increasingly becoming complex. Furthermore, the lot of a democratic Judge is heavier and thus nobler. We cannot escape the burden of individual responsibilities in a particular situation in view of the peculiar facts and circumstances of the case. There is no escape in absol....
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....of Courts Act, 1971, that any such publication would tend to interfere with the fair administration of justice and so constitute criminal contempt and would be liable not merely to punitive action after publication but also to stoppage by a preventive order before publication. On the other hand, for the respondents, it is contended that, in the decisions relied upon for the petitioners, the publications alleged to constitute contempt were of such a nature that they were seen to affect the course of actions actually pending in courts, that even otherwise the decision of ; the House of Lords has been widely criticised and should not be followed and that the views expressed by Lord Denning, M.R. in Attorney General v. BBC, [1979 3 AER 45-though reversed by the House of Lords in 1981 A.C. 303--and by the American Courts in Bridges v. State of California, 86 L. Ed. 252 and in John D. Pennekamp v. Stale of Florida, 90 L. Ed. 1295 should be preferred as more appropriate to present day conditions, particularly in the context of the freedom of press guaranteed under Act 19(1)(a) of the Constitution of India, and also incorporated in Article 19 of the Universal Declaration of Human Rights, 1....
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.... order dated 25.8.88 or the earlier order dated 19.8.88. It should be remembered that the proceedings, which gave rise to the transfer applications, were writ petitions and a suit filed in various courts challenging inter alia, the validity or regularity Of the debenture issue of the petitioner company. If these matters had been heard by the various High Courts or other subordinate courts, there was a possibility that one or more of the courts, satisfied with the prima facie tenability of the contentions of the petitioners therein might issue an order staying the debenture issue pending disposal of the suit or writ petition. In fact, also, it seems that interim orders of this nature had been obtained. The petitioner was apprehensive that, if any such interim order was passed, all the time, labour and money expended in floating the debenture issue might be nullified at the last moment. The petitioner, therefore, moved for the transfer of all the various proceedings to this Court and for an interim order permitting it to issue the debentures as planned without let or hindrance and without being hampered by any interim stay order from any court. I do not think it would be correct to s....
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.... defeat the object with which this Court had passed the interim order dated 19.8.88. This is the reason why we passed the second order dated 25.8.88 and also declined to modify or vary it at 1he request of the counsel for the newspapers on the next day. I am of opinion that the said order was rightly passed and that the contention of learned counsel for the respondent that no such injunction ought to have been granted at all is not acceptable. The position today, however, has radically changed. We are told that the issue has been over-subscribed. In my opinion, this stage having been completed, there is no necessity to continue the interim order passed by us on the 25th of August, 1988. Counsel for the petitioner, however, vehemently contended that there has been no material change in the situation. He submitted that many lakhs of people have subscribed to the debentures and, within a strict time schedule laid down by the statute, the petitioner is bound to scrutinise all the applications, decide on the issue of allotment and send out allotment letters or refund the application moneys received. It is submitted that even at this stage there is a potential danger that continued pub....