PETITIONER:
AMRIT LAL CHUM
Vs.
RESPONDENT:
DEVOPRASAD DUTTA ROY AND ANR. ETC.
DATE OF JUDGMENT20/01/1988
BENCH:
SEN, A.P. (J)
BENCH:
SEN, A.P. (J)
VENKATARAMIAH, E.S. (J)
SHARMA, L.M. (J)
CITATION:
1988 AIR 733 1988 SCR (2) 783
1988 SCC (2) 269 JT 1988 (1) 218
1988 SCALE (1)213
CITATOR INFO :
APR 1988 SC 733 (1)
ACT:
Companies Act, 1956: Section 630-interpretation
officer/ employee of company allotted flat, refusing to
vacate, after retirement-Prosecution of such
officer/employee-Whether permissible.
HEADNOTE:
%
Section 630 of the Companies Act, 1956 empowers the
court, on the complaint of the Company, or any creditor or
contributory thereof, to punish an officer or employee of
such company, by levy of fine, if such officer or employee
wrongfully obtains possession of, or having obtained
possession, wrongfully withholds or knowingly misapplies,
the property of the company, and also order him to deliver
up or refund, within a stipulated time, such property or,
in default, to suffer imprisonment.
In these appeals against the Judgment of the High
Court, the question for consideration was as to the scope
and interpretation of this provision. E
Allowing the appeals,
^
HELD: Section 630 of the Companies Act, 1956 plainly
makes it an offence if an officer or employee of a company
who was permitted to use the property of the company during
his employment, wrongfully retains or occupies the same
after the termination of his employment. It is the wrongful
withholding of such property, meaning the property of the
company after termination of the employment, which is an
offence under s. 630(l) of the Act. [785B-C]
There is, therefore, no warrant to give a restrictive
meaning to the term "officer or employee" appearing in sub-
section (1) of s. 630 of the Act as meaning only the
existing officers and employees and not those whose
employment has been terminated. [785C-D]
Baldev Krishna Sahi v. Shipping Corporation of India
Ltd. & Anr., [ 1987} 4 SCC 361, followed. H
784
[Time granted to respondents till June 30, 1988 to vacate
the premises subject to the furnishing of usual undertaking.
In the event of failure to furnish the undertaking and/or
vacate the premises within the time stipulated, the cases
against the respondents to continue and the trial court to
proceed with the trial and dispose them of expeditiously,
but not later than 31.10.88.] [785G-H; 786A]
JUDGMENT:
CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
368 of 1986.
From the Judgment and order dated 11.4.1986 of the
Calcutta High Court in Crl . R . No . 1181 of 1985 .
WITH
Criminal Appeals Nos. 251-252 of 1986.
From the Judgment and order dated 26.7.1975 of the
Calcutta High Court in Crl. Revn. Nos. 222 and 448 of 1985.
Dr. Y.S. Chitale and H.K. Puri for the Appellant.
Parijat Sinha for the Respondent in Crl. A. No. 368 of
1986.
S.K. Kapur, Ranjan Dev and Mrs. Indra Sawhney for the
Respondents in Crl. A. No. 251-252 of 1986.
Tapas Roy and D.K. Sinha for the State of West Bengal.
D.K. Sinha, K.R. Nambiar, Ms. Reba Roy, K.K. Lahitri
and Ms Apsi Ditta for the Interveners.
The following order of the Court was delivered
O R D E R
After hearing Shri S.K. Kapoor, learned counsel
appearing for respondent no. 1 in Criminal Appeals Nos. 251-
252 of 1986 at quite some length, we are not persuaded to
take a view different from the one expressed by this Court
in the recent judgment in Baldev Krishna Sahi v. Shipping
Corporation of India Ltd. & Anr., [ 1987] 4 SCC 361
overruling the judgment of the Calcutta High Court in Amrit
Lal Chum v. Devi Ranjan Jha, [1987] 61 Company Cases 211 as
to the scope and effect of sub-s. (1) of s. 630 of the
Companies Act, 1956. The Court in Baldev Krishna Sahi’s case
has placed a beneficent construction on the provisions
contained in sub-s. (1) of s. 630 of the Act
785
and according to it the term ‘officer or employee’ in sub-s.
(1) of s. 630 must be interpreted to mean not only the
present officers and employees of a company but also to
include the past officers and employees of the Company. It
has also taken the view that the words ‘any such property’
in cl. (b) thereof qualify the words ‘any property of a
company’ appearing in cl. (a). As observed in Baldev Krishna
Sahi’s case, s. 630 of the Act plainly makes it an offence
if an officer or employee of a company who was permitted to
use the property of the company during his employment,
wrongfully retains or occupies the same after the
termination of his employment. It is the wrongful
withholding of such property, meaning the property of the
company after termination of the employment, which is an
offence under s. 630(l)(b) of the Act. The construction
placed by this Court in Baldev Krishna Sahi’s case is the
only construction possible. There is therefore no warrant to
give a restrictive meaning to the term ‘officer or employee’
appearing in sub-s. (1) of s. 630 of the Act as meaning only
the existing officers and employees and not those whose
employment have been terminated. The Court in Baldev Krishna
Sahi’s case has expressly overruled the judgment of the
Calcutta High Court in Amrit Lal Chum v. Devi Ranjan Jha,
supra, against which these appeals have been filed and
upheld the consistent view to the contrary taken by the High
Court of Bombay in a series of cases. [See Harkishin
Lakhimal Gidwani v. Achyut Kashinath Wagh, [1982] 52 Company
Cases 1 and Govind T. Jagtiani v. Sirajuddin S. Kazi, [1984]
56 Company Cases 329].
Accordingly, these appeals must succeed and are allowed
with costs. The judgment of the High Court allowing the
applications under s. 482 of the Code of Criminal Procedure,
1973 are set aside.
Shri S.K. Kapoor, learned counsel appearing for
respondent no. 1 in Criminal Appeals Nos. 251-252 of 1986
and Shri Parijat Sinha, learned counsel for respondent no. 1
in Criminal Appeal No. 368 of 1986 pray for time to vacate
the premises in their occupation. We grant the respondents
time till June 30, 1988 to vacate the premises subject to
their furnishing the usual undertaking in this Court within
four weeks from today. If there is a failure on the part of
the respondents to comply with these conditions, namely,
failure to file the said undertaking and/or to vacate the
premises within the time allowed, the cases against them
i.e. Complaint Case No. 1053/83 in the Court of IIIrd
Additional Judicial Magistrate, Alipore, 24 Paraganas and
Complaint Case No. 2788/84 in the Court of Special
Divisional Judicial Magistrate, Alipore, 24 Paraganas shall
continue. In the event of respondents’ failure to file the
undertaking and/or vacate the premises within
786
the time specified, the learned Magistrates shall proceed
with the trial of these cases and dispose them of as
expeditiously as possible and in any event, not later than
October 31, 1988.
The intervention application filed by Tata Iron and
Steel Company Limited is not pressed.
N. P.V. Appeals allowed.
787