Vijay and Deepak Raheja, directors of the B Raheja Builders, have been found guilty of contempt of court by the Bombay High Court on Wednesday. The Raheja family, which is into construction and property development business since nearly five decades, is embroiled in a family dispute revolving around development of a five-star hotel in Bangalore.
A division bench of Justice S Radhakrishna and Justice SJ Vazifdar while imposing a fine of Rs 2,000 each on Vijay and Deepak directed them to pay Rs 10 lakh to the Maharashtra Legal Aid Society for violating earlier court order.
The bench was hearing a contempt petition filed by Vijay's elder brother Gopal Raheja, director of K Raheja Constructions. Gopal has filed a suit against Vijay in 2004 over a souring of a Rs 45 crore joint deal to develop a five-star hotel in Bangalore.
The two brothers had entered into an agreement to bid for and acquire a Bangalore plot and set up a five-star hotel along with Marriot International in the United Breweries City in Bangalore. However, Gopal alleged that Vijay sidelined him and signed an agreement with a New Zealand based company - Gstadd - for the same.
Gopal then filed the suit in the HC in 2004, which was expedited in October 2005, for breach of contract committed by Vijay. The HC had then restrained Vijay from proceeding with the project till further orders. However, Vijay and Deepak acquired shares in the new company and became its directors.
Terming this as violation of HC order restraining Vijay and Deepak, Gopal filed a contempt petition. While hearing the petition, the bench had suggested the brothers to reach an amicable solution "keeping in view the reputation of the Raheja group." However, the family failed to reach an out-of-court settlement.
Aspi Chenoy, Janak Dwarkadas and Parimal Shroff argued that Vijay and Deepak should be sentence to imprisonment for contempt instead of just levying fine. "The punishment should act as a deterrent so that they do not commit similar act in future. Otherwise, the accused may again lie and then apologise before the court and escape punishment," argued Chenoy.
Apologising for Vijay and Deepak, their counsel Iqbal Chagla told the court that imprisonment as punishment was the discretion of the court and not mandatory as per the law.
The bench observed that keeping in view the apology tendered by the two, the court has not sentenced them to imprisonment.
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