RAJ PAL YADAV Vs. MURLI PROJECTS PVT. LTD.

JUDGEMENT

(1.) The appellant in these proceedings was arrayed as second defendant in a suit (CS (OS) 3037/2012 - hereafter "the suit"). He is aggrieved by the order, dated 03.12.2013 of the learned Single Judge sentencing him to simple imprisonment for 10 days. He was held guilty of committing contempt on 13.05.2013 for repeatedly violating undertakings given to this Court. The court had, however, deemed it appropriate to provide the appellant with reasonable opportunity to be heard before imposing sentence. The appellant's conduct in the intervening period from 13.05.2013 to 03.12.2013 was taken into consideration by the single judge, while passing of the impugned order. The appellant exercised his statutory right to appeal after having served sentence from 03.12.2013 to 06.12.2013. The learned Single Judge suspended his sentence for a period of 4 days until 10.12.2013. In the appellate proceedings, on 10.12.2013, this Court ordered interim stay of sentence.

(2.) The brief facts of the case are that the appellant is an actor and has acted in several Hindi films. He along with his wife (third defendant) founded and incorporated a company by the name "Shree Naurang Godavari Entertainment Ltd." (the first defendant - hereafter) and Shree Naurang Godavari Edutainment Pvt. Ltd. (fourth defendant - both the first and fourth defendants hereafter referred to as "the company"). The appellant, for the purpose of producing a film "Ata Pata Lapata" sourced Rs.15 crores independently. The plaintiff in the suit showed interest in investing in the film and proposed to advance a sum of Rs.5 Crores towards it. The appellant contended that the plaintiff created a unilateral agreement, much to the detriment of the appellant, on 30.05.2010 for the purpose of advancing the loan. In terms of the agreement, the defendants were to repay the loan amount of Rs.5 Crores by 31.03.2011. In addition, they were to pay Rs.3 Crores out of which Rs.2.50 crores were towards return of the said loan including interest, cost etc. payable in four installments of Rs.50 lakhs, Rs.60 lakhs, Rs.70 lakhs and Rs.70 lakhs by 31.03.2011, 30.04.2011, 31.05.2011 and 30.06.2011 respectively. The remaining Rs.50 lakhs was repayable by 31.03.2011 towards management cost of arranging funds, administrative expenses, office expenses, documentation charges etc. The respondent claimed 30% interest p.a. in case of delayed payment by the defendants. Towards the said agreement the defendants issued 10 post -dated cheques aggregating to a total value of Rs. 8 crores to the plaintiff as security and also executed a promissory note for the said amount. ThisRs. 8 Crores was also secured by way of "laboratory letter" which conveyed the rights on the negatives of the film in favour of the plaintiff. The music audio and video rights, CD/DVI/ Internet rights, satellite rights, channel rights, export/international rights etc. were also assigned in favour of the plaintiff as security.

(3.) The film was delayed due to unforeseen circumstances as a result of which it could not be released on the scheduled date - 31.12.2010 and consequently amounts due could not be paid. This led to several supplementary agreements (dated 21.09.2011, 04.04.2012 and 09.08.2012) between the plaintiff and the appellant towards repayment of the said loan amount of Rs.8 crores. These three documents, alleged the appellants - defendants were obtained under duress. Under the first supplementary agreement the defendants undertook to pay an additional sum of Rs.1,38,06,332 towards 30% interest per annum and as a result 6 fresh post - dated cheques were issued by them to the plaintiff towards a total revised sum of Rs.9,38,06,332. Again on 04.04.2012 the defendants agreed to pay an enhanced sum of Rs. 10,72,52,745 owing to default in previous payment in 6 installments by 30.09.2012. Out of this Rs.40 lakhs were transferred to the plaintiff by way of RTGS on 30.04.2012. Finally, a third supplementary agreement was entered into on 09.08.2012 which required the defendants to pay a revised total of Rs. 11,10,60,350 in 8 installments to the plaintiff by 28.02.2013.