Contempt of Court

Contempt of Courts Act, 1971

Wilful disobedience of a court order, or conduct that scandalises or interferes with the administration of justice. In debt recovery, contempt petitions are filed when borrowers refuse to comply with DRT attachment orders, fail to disclose assets as ordered, or transfer properties in defiance of court orders. Punishment: imprisonment up to 6 months or fine up to ₹2,000, or both.

In practice, contempt is the sanction that gives court orders their teeth in recovery work. When a borrower wilfully flouts a DRT attachment order, refuses to disclose assets the tribunal has directed it to reveal, or transfers property in defiance of a restraint, the creditor's remedy is a contempt petition under the Contempt of Courts Act, 1971 — punishable by imprisonment up to six months or a fine, or both. The leverage is less the modest penalty and more the personal jeopardy it puts on the defaulter and its directors, which often produces compliance that the underlying order alone did not. The threshold, though, is wilfulness: counsel must show deliberate, knowing disobedience, not mere inability or genuine ambiguity in the order. The common error is launching contempt where the order was vague or compliance was impossible, which the court will not entertain. Well-advised creditors first ensure the order is clear and the breach demonstrably wilful before invoking contempt.