Delhi HC Rejects Income Tax Director's Appeal U/S 19 Contempt Of Courts Act, Says Appeal Maintainable Only If Order Imposes Punishment

The Delhi High Court has dismissed the appeal preferred by a Director of Income Tax under Section 19 of the Contempt of Courts Act, 1971.A division bench of Justices Chandra Dhari Singh and Manoj Jain observed that in the absence of the contempt court recording a finding of guilt or imposing a punishment, the appeal preferred under Section 19 by an alleged contemnor, the Income Tax Director in this case, is not maintainable.It observed, “the position of law pertaining to Section 19 of the Act is that the appeal against the orders passed in the contempt proceedings cannot be maintainable if such an order is devoid of any punishment or guilt imposed upon the contemnor.”A contempt plea was filed against the Appellant for 'wilful disobedience' of a single-judge's direction requiring him to pass an appropriate order for release of amounts seized from the respondent, as no notice for the assessment of the seized amount was provided.While disposing of the contempt plea, the single judge had directed the appellant to deposit the amount seized from the respondent along with interest, which was then to be released to the respondent.It is challenging this direction that the Appellant invoked appellate jurisdiction under Section 19.It was submitted that the impugned order did not take into consideration the fact that no formal application was filed by the respondent for release of the amount deposited with the Registry. It was contended that in absence of any formal application by the respondent, the Single Judge had erroneously passed the impugned order by directing the Registrar to release the entire deposited amount in favour of the respondent.The Respondent on the other hand submitted the appeal is not maintainable as Section 19 states that the appeal is maintainable only in the case where the Single Judge of the High Court has awarded punishment in the contempt proceedings.At the outset, the High Court addressed the preliminary objection to the appeal. It referred to Midnapore Peoples' Coop. Bank Ltd. v. Chunilal Nanda, (2006) wherein the Hon'ble Supreme Court had observed that the appeal under Section 19 of the Act is maintainable only against an order in which punishment has been awarded to the contemnor.Based on the above, the Court observed, “an appeal under Section 19 of the Act, challenging the order passed in the contempt proceedings, is maintainable only when such an order records or imposes any punishment or guilt of the contemnor. However, upon perusal of the impugned order, it is clear that the learned Single Judge has merely directed the appellant to release the amount already deposited along with the interest accrued thereupon @ 6% p.a. till date while making concession towards the statutorily prescribed grace period of 120 days in favour of the respondent and therefore, the same cannot be construed to be punitive in nature,” and dismissed the appeal.Appearance: Mr. Shlok Chandra, Senior Standing Counsel with Ms. Naincy Jain and Ms. Madhavi Shukla, Junior Standing Counsel and Mr. Sankalp Sharma, Advocates for Appellant; Mr. Sahil Sharma, Advocate for RespondentCase title: RK Yadav Through Director Of Income Tax Inv-II And Ors v. Dinesh KumarCitation: 2025 LiveLaw (Del) 76Case no.: CONT.APP.(C) 2/2025Click here to read order

Delhi HC Rejects Income Tax Director's Appeal U/S 19 Contempt Of Courts Act, Says Appeal Maintainable Only If Order Imposes Punishment

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