The Bombay High Court has reaffirmed that breaching a solvent surety furnished to the court as a condition for leave to defend in a summary suit constitutes civil contempt, irrespective of an unconditional apology. The judgment underscores that courts must not treat apologies as legal loopholes when parties deliberately undermine judicial orders.
Background & Facts
The Dispute
The petitioners, Dr. Hari Tulshiram Gholap and Dr. Prabiha Hari Gholap, filed a Special Summary Suit No. 207 of 2009 against the respondents, Shri Jitendra Rajaram Savant and Shri Rajaram Yashwant Savant, seeking compensation of Rs. 2,30,00,000/- plus 18% interest. The claim arose from an agreement dated 11.02.2009, wherein the respondents, representing a partnership firm, agreed to pay this amount as compensation for failing to deliver two flats in a residential project. The petitioners had paid Rs. 46,50,000/- between 2003 and 2008 towards the purchase of these flats.
Key Facts
- The petitioners paid Rs. 46,50,000/- to the partnership firm between 2003 and 2008.
- The respondents sold the flats to third parties, prompting the compensation agreement dated 11.02.2009.
- The trial court granted conditional leave to defend on 02.05.2011, subject to furnishing a solvent surety equal to the claim amount: Rs. 2,30,00,000/- plus 18% interest.
- Respondent no. 2, the father of respondent no. 1 (defendant no. 4), submitted a solvency certificate for property bearing Gat No. 775 as solvent surety.
- The written statement of respondent no. 1 was recorded on 02.05.2011 after the surety was furnished.
- The respondents challenged the order in Writ Petition No. 8116 of 2011, which was dismissed by this court on 10.10.2011, with an extension of time to furnish surety.
- A separate writ petition by the heirs of deceased defendant no. 2 was disposed of on 07.04.2014, with explicit clarification that the solvent surety furnished by respondent no. 1 would continue to operate and could not be withdrawn.
- On 13.06.2023, respondent no. 2 executed a registered sale deed transferring Gat No. 775 to a third party, with respondent no. 1 signing as a confirming party.
- No permission was sought from the court prior to the sale.
- The sale deed was executed after the respondents were fully aware of the continuing obligation under the court’s orders.
- The respondents filed an affidavit-in-reply on 06.12.2025, admitting the breach but claiming financial hardship and lack of legal oversight due to the death of their advocate.
- Respondent no. 2 is 91 years old and reportedly bedridden.
Procedural History
- 11.02.2009: Compensation agreement executed between parties.
- 02.05.2011: Trial court grants conditional leave to defend subject to solvent surety of Rs. 2,30,00,000/-.
- 10.10.2011: Bombay HC dismisses Writ Petition No. 8116 of 2011, upholding the trial court’s order.
- 07.04.2014: Bombay HC disposes of Writ Petition No. 6435 of 2013, clarifying that the solvent surety remains operative and cannot be withdrawn.
- 13.06.2023: Respondents execute registered sale deed of the surety property.
- 03.09.2025: Bombay HC records prima facie finding of contempt.
- 17.10.2025: Contempt petition admitted; notice issued to respondents.
- 06.12.2025: Affidavit-in-reply filed by respondents.
- 09.05.2025: Respondent no. 1 files application in trial court seeking permission to replace surety (after contempt notice).
- 04.05.2026: Second session held; respondents tender undertaking to settle suit.
- 04.05.2026: Judgment delivered.
Relief Sought
The petitioners sought punishment for civil contempt under Section 12 of the Contempt of Courts Act, 1971, for willful breach of court orders. They opposed the acceptance of the apology and sought enforcement of the original claim.
The Legal Issue
The central question was whether executing a sale deed of property furnished as solvent surety to the court, without permission, constitutes civil contempt under Section 2(b) of the Contempt of Courts Act, 1971, and whether an unconditional apology coupled with a willingness to replace the surety can absolve such a willful breach.
Arguments Presented
For the Petitioner
The petitioners argued that the respondents knowingly breached a court-imposed condition essential to the integrity of the summary suit process. The solvent surety was not a private arrangement but a solemn undertaking to the court, meant to secure the claimant’s right to recover the principal amount. The sale of the surety property was a calculated move to defeat the petitioners’ right to enforce the decree. The apology was not genuine but a tactical response triggered only after the court issued notice. The petitioners relied on Balwantbhai Somabhai Bhandari v. Hiralal Somabhai Contractor to argue that courts must not reward deliberate disobedience with leniency.
For the Respondent
The respondents admitted the breach but contended that it was not willful. They claimed financial distress, advanced age of respondent no. 2, and the death of their advocate led to inadvertent non-compliance. They argued that their apology was unconditional and that they were willing to replace the surety or deposit the claim amount. They relied on Yogesh Prakash Kela v. High Court On Its Own Motion and Section 12 of the Contempt of Courts Act, 1971, particularly the Explanation to sub-section (1), to argue that a bona fide apology - even if conditional - must be accepted.
The Court's Analysis
The court began by affirming that a solvent surety is not merely a procedural formality but a binding undertaking to the court. Under Section 145 of the CPC, the surety property is held as security for the claim, and its encumbrance defeats the very purpose of the condition. The court held that the undertaking to keep the property unencumbered is implicit in the act of furnishing surety.
"The undertaking to the court that the land shall remain unencumbered is implicit in the solvent surety provided by the party as the condition for leave to defend the summary suit."
The court emphasized that the respondents were fully aware of the continuing obligation, as confirmed by the 07.04.2014 order, which explicitly barred withdrawal of the surety. The sale deed executed on 13.06.2023 was not a spontaneous act of desperation but a deliberate maneuver to dispose of the secured asset after the suit had progressed.
The court then turned to the issue of apology. Citing Balwantbhai Somabhai Bhandari v. Hiralal Somabhai Contractor, the court held that an apology is not a legal shield against contempt when the breach is intentional and the conduct undermines judicial authority. The court observed:
"The litigants... have realised that they have a very potent weapon in their hands in the form of apology... There ought not to be a tendency by courts to show compassion when disobedience of an undertaking or an order is with impunity and with total consciousness."
The court rejected the respondents’ claim of bona fide mistake, noting that the application to replace the surety was filed only after the court recorded a prima facie finding of contempt. The apology, therefore, was reactive, not reflective. The court further held that the respondents’ attempt to argue that interim orders lapsed due to delay in trial was legally untenable and an afterthought.
The court distinguished Yogesh Prakash Kela on facts, noting that in that case, the breach was not as flagrant and the apology was tendered earlier. Here, the respondents’ conduct was a calculated gamble: they retained the benefit of defending the suit while secretly disposing of the security.
The Verdict
The respondents were held guilty of civil contempt under Section 12(1) of the Contempt of Courts Act, 1971. However, in light of the undertaking dated 04.05.2026, wherein respondent no. 1 agreed to pay Rs. 2,30,00,000/- as principal and Rs. 2,30,00,000/- as interest (total Rs. 4,60,00,000/-), the court discharged them on payment of a fine of Rs. 2,000/-. The fine must be deposited in the trial court within four weeks. The undertaking and consent terms are accepted as court undertakings. The petitioners are permitted to withdraw the settlement amount without conditions, and the trial court shall dispose of the suit in accordance with the consent terms. All pending applications are disposed of as infructuous.
What This Means For Similar Cases
Apology Is Not a Legal Get-Out-of-Jail-Free Card
- Practitioners must advise clients that an apology alone cannot absolve deliberate breach of court orders.
- Courts will examine the timing, motive, and conduct behind the apology - reactive apologies after notice are treated with skepticism.
- Bona fide mistake must be demonstrable and not a post-hoc justification for calculated non-compliance.
Solvent Surety = Binding Undertaking to the Court
- Any property offered as solvent surety must remain unencumbered until final disposal of the suit.
- Selling, mortgaging, or transferring such property without court permission constitutes civil contempt, regardless of third-party rights.
- Third-party purchasers cannot claim protection in contempt proceedings; the contempt is between the court and the contemnor.
Judicial Discretion in Apology Acceptance Is Strict
- Courts are not bound to accept even unconditional apologies if the conduct damages the dignity of the institution.
- The Balwantbhai precedent now sets a high threshold: contemptuous conduct must be met with deterrence, not leniency.
- Practitioners should not advise clients to rely on apology as a strategy; instead, they must seek formal court permission before altering secured assets.
