Balwantbhai Somabhai Bhandari vs Hiralal Somabhai Contractor (Deceased) Rep. by LRs. & Ors.
Background
During a pending High Court writ petition over disputed land in Surat, the owners' counsel gave an undertaking to the Gujarat High Court in 2015 that the property would not be sold until the main case was finally decided: an undertaking that led the opposing side to withdraw a related appeal. Despite this, the owners (through their power-of-attorney holder) went on to execute thirteen separate sale deeds transferring parts of the land to different buyers between 2015 and 2018, for consideration far below the properties' actual index/market value, and pocketed the sale proceeds. The High Court held the sellers and their agent guilty of civil contempt, sentenced them to imprisonment/fine, declared all thirteen sale deeds void, and ordered restoration of the pre-sale position; the contemnors appealed to the Supreme Court under Section 19 of the Contempt of Courts Act, 1971, and the buyers (who were not made parties before the High Court) separately appealed as affected purchasers.
Decision Breakdown
The Supreme Court dismissed all three appeals, holding that a breach of an undertaking given to a court (as opposed to one given only to the opposing party in a settlement) squarely amounts to civil contempt under Section 2(b) of the 1971 Act. It held that a court hearing contempt proceedings can declare pendente lite transfers void to strip contemnors of any advantage from their contumacious conduct, even though such transfers are not automatically void ab initio in ordinary civil law. The Court further held that purchasers from a contemnor have no independent right to be heard in the contempt proceeding itself, since contempt is strictly a matter between the court and the contemnor, being a "bona fide purchaser for value" does not create a right to be impleaded there. Finally, the Court rejected the contemnors' unconditional apology, holding that an apology is not an automatic shield and courts are not bound to accept it, especially where the contemnors sold property with full knowledge of their undertaking, retained the sale proceeds, never cancelled the power of attorney even after contempt notice, and offered only after-the-fact justifications rather than genuine remorse.
Lesson Learnt
An undertaking given to a court is far more serious than an ordinary promise between parties, breaching it is contempt of court, and courts can nullify any transactions made in violation of it to prevent the wrongdoer from profiting; a later "sorry" is not a guaranteed escape route, particularly when the contemnor kept the money and never tried to genuinely undo the wrong, and buyers dealing with property under active litigation bear the risk of the seller's own legal violations.