The Supreme Court of India has quashed and set aside contempt proceedings initiated by the Allahabad High Court against Ritu Maheshwari, the Chief Executive Officer (CEO) of the New Okhla Industrial Development Authority (NOIDA). A bench comprising Chief Justice of India B.R. Gavai and Justice K. Vinod Chandran held that when a court directs an authority to reconsider a matter afresh, a subsequent reasoned order rejecting the claim on multiple grounds does not amount to contempt, even if the aggrieved party disagrees with the reasoning. The remedy for the aggrieved party, the Court clarified, is to challenge the new order, not to pursue contempt.
The appeal before the apex court challenged an interim order dated October 6, 2021, from a Single Judge of the Allahabad High Court, which had found a prima facie case of contempt against the NOIDA CEO for allegedly failing to comply with an earlier court directive to regularize the services of several drivers.
Background of the Case
The case originates from numerous petitions filed by drivers engaged by NOIDA seeking the regularization of their services. Their claims were first rejected by the Chairman and CEO of NOIDA through an order dated November 8, 2017.
The drivers challenged this rejection in the Allahabad High Court. In a judgment dated February 4, 2020, a Single Judge of the High Court set aside NOIDA’s rejection order. The High Court observed that the authority had wrongly brushed aside the drivers’ claims “solely on the ground that they were engaged for intermittent work through a Contractor.” The Court found this to be a “result of non-application of mind” and noted that NOIDA had failed to substantiate its stand that the drivers were contractual employees engaged through a contractor.
The High Court directed the NOIDA CEO to reconsider the drivers’ claims for regularization afresh, keeping in view the observations made in its judgment and in light of the qualifying conditions of the Government Order dated February 24, 2016. The High Court explicitly stated:
“It is further provided that the Chief Executive Officer, NOIDA, Ghaziabad, U.P shall consider the claim of the petitioners afresh for regularization keeping in view of the observations made hereinabove, strictly in the light of the qualifying conditions of the Government Order dated 24.2.2016 or the Regularization Rules’ 2016, as on the date of submission of their representation rejected vide order dated 8.11.2017.”
The High Court added that the only rider was that the drivers “cannot be treated as Contract Labour hired through a registered Contractor/Supplier/Service Provider in absence of a valid Contract for such services.”
NOIDA’s Reconsideration and Subsequent Contempt Petition
Following the High Court’s directive, NOIDA constituted a committee to examine the matter. Based on the committee’s report, the CEO, Ritu Maheshwari, passed fresh orders on August 17, 18, and 19, 2021, once again rejecting the drivers’ claims for regularization. The rejection was based on several grounds, including the qualification of the respondents vis-à-vis the 2016 Government Order, the effect of a subsequent Government Order from 2018, and the additional financial burden on NOIDA.
Alleging that these new orders were a willful disobedience of the High Court’s February 4, 2020 judgment, the drivers filed a contempt application. The High Court, in its order dated October 6, 2021, found a prima facie case for contempt and gave the CEO “one last opportunity” to comply with the order, failing which she was directed to appear in person to face the framing of charges. This order led to the present appeal in the Supreme Court.
Arguments Before the Supreme Court
Appearing for the appellant CEO, Additional Solicitor General Tushar Mehta argued that the High Court’s 2020 order only required NOIDA to consider the claims afresh and pass a reasoned order. He submitted that this direction was fully complied with, as the claims of each driver were duly considered and rejected via speaking orders. Therefore, he contended, the contempt petition was not tenable.
For the respondent drivers, Senior Counsel V. Mohana submitted that their claims were rejected on the very same grounds that the High Court had already set aside. She argued that the 2020 order contemplated the regularization of their services and that the High Court was correct in initiating contempt proceedings.
Supreme Court’s Analysis and Decision
The Supreme Court bench analyzed the High Court’s 2020 order and found that it mandated a fresh consideration of the drivers’ claims with a specific condition: their claims should not be rejected solely on the ground that they were contractual employees.
The apex court noted that the subsequent rejection orders of August 2021 were not based solely on this ground. Instead, the rejection was a result of a “thorough consideration of several other grounds,” including the applicability of government orders and the financial implications.
The Supreme Court concluded that NOIDA had complied with the High Court’s directions. The bench observed:
“In that view of the matter, the orders dated 17.08.2021, 18.08.2021 and 19.08.2021 must be considered as compliance with the directions issued under the order dated 04.02.2020.”
The Court held that the contempt proceedings were not maintainable. It reasoned that if the drivers were aggrieved by the reasoning in the new rejection orders, their proper legal remedy was to file a fresh writ petition challenging those orders, not to file a contempt case.
“If the respondents were aggrieved by the reasoning given by the appellant in orders dated 17.08.2021, 18.08.2021 and 19.08.2021, then, at the most, it could have given rise to fresh cause of action for challenging the said orders,” the judgment stated.
While allowing the appeal and quashing the High Court’s contempt order, the Supreme Court did direct that a specific portion of NOIDA’s rejection orders, which had unnecessarily referred to a separate, unrelated SLP, be deleted.
The Court granted liberty to the respondent drivers to challenge the August 2021 rejection orders in accordance with law and directed that they would be entitled to the benefit of Section 14 of the Limitation Act, 1963, for the period they were pursuing the matter before the Supreme Court.
