New Delhi: Disapproving of the Sahara Group chief Subrata Roy's "calculated psychological offensives and mind games", the Supreme Court Tuesday upheld its order jailing him and rejected his claim that rules of natural justice were not followed in the case.
"Disobedience of orders of a Court strikes at the very root of the rule of law, on which the judicial system rests. Judicial orders are bound to be obeyed at all costs.
"Howsoever grave the effect may be, is no answer for non-compliance of a judicial order. Judicial orders cannot be permitted to be circumvented. In exercise of contempt jurisdiction, Courts have the power to enforce compliance of judicial orders, and also, the power to punish for contempt," the Court said in its 207-page order dismissing Roy's petition against his detention.
65-year-old Roy, who has been in jail since March 4 for non-refund of over Rs.20,000 crore to depositors, was asked by the court to make a fresh proposal for paying Rs 10,000 crore to get bail.
A bench of justices K S Radhakrishnan and J S Khehar in a strongly-worded judgement came down heavily on the Group for "systematically" frustrating and flouting all its orders with impunity on refunding investors' money.
It said the group "adopted a demeanour of defiance constituting a rebellious behaviour, not amenable to the rule of law" and justified its decision to send Roy along with two promoters of the companies to jail.
The bench said it started adopting sequentially harsher means to persuade compliance of it's order on refunding money leading to his detention after all the efforts to "cajole" the two companies and the petitioner were "methodically circumvented".
"Efforts made to cajole the two companies and the petitioner were always stonewalled and brushed off. All intermediary means to secure compliance of this Court?s orders dated 31.8.2012 and 5.12.2012, were evaded and skirted.
"Even proposals to secure the payments (as against, the payment itself) to be made to the investors, in terms of this Court?s orders, were systematically frustrated," it said.
The bench also slammed Roy plea seeking its recusal from hearing the case.
"We find no merit in the contention advanced on behalf of the petitioner, that we should recuse ourselves from the hearing of this case. Calculated psychological offensives and mind games adopted to seek recusal of Judges, need to be strongly repulsed.
"We deprecate such tactics and commend a similar approach to other Courts, when they experience such behaviour," it said.
The bench said that the two companies of which Roy is a promoter "flouted" various orders passed by the SEBI, SAT, the High Court and of this Court, with impunity which cannot be allowed.
"This Court recorded in its order dated August 31, 2012, that the factual assertions made on behalf of the two companies seemed to be totally unrealistic and could well be fictitious, concocted and made up, and also remarked, that the affairs of the two companies seemed to be doubtful, dubious and questionable.
"The above position has remained unaltered, inasmuch as, no authentic and verifiable material sought has ever been furnished by the two companies. The two companies remained adamant while frittering away repeated opportunities granted by this Court to comply with the orders," the bench said.
The apex court held that various proposals made by Roy and the group on depositing money turned out to be "ploys to sidetrack and derail the process of law".
It said that the apex court, before passing the order for sending him jail, had "immaculately" followed the procedure and Roy and other contemnors were afforded an opportunity of oral hearing before the order was passed.
"In view of the above facts it is not possible for us to accept, that the impugned order was passed without following the rules of natural justice or without affording the petitioner an opportunity of hearing," it said.
The bench said Civil and Criminal Procedure Codes envisage arrest and detention as a mean for enforcing financial liability and Roy's submission that "execution of a money decree or enforcement of a financial liability by way of arrest and detention was a procedure unknown to law, is therefore, wholly misconceived".
It also brushed aside the contentions of the group that money had already been substantially refunded to investors saying the stand has been rejected earlier also and the contention is untenable.
"Sole reliance on general ledger entries without any other authentication, has been held to be insufficient proof of the refunds claimed to have been made by the two companies to the investors, specially because, such cash redemptions have not been affirmed in the certificate issued by the firm of Chartered Accountants, which had audited the accounts of the two companies," it said.