Delhi District Court
Sh. Karan Singh vs M/S Texmaco Ltd on 21 January, 2014
IN THE COURT OF SH. NARINDER KUMAR
ADDITIONAL SESSIONS JUDGE (CENTRAL): DELHI
Criminal Appeal No. 149/13
In the matter of :
Sh. Karan Singh,
S/o Late Sh. Baney Singh,
R/o Qtr. no. 13A, Shivaji Lines,
Shakti Nagar, Delhi 110 007. .....Appellant
Versus
1. M/s Texmaco Ltd.
Having its regional office at:
508. Surya Khan Building
Kastoorba Gandhi Marg,
New Delhi 110 001.
2. The State
Through its Secretary,
Govt. of NCT of Delhi. .... Respondents
Date of institution : 25.11.2013
Date of Judgment : 21.01.2014
JUDGMENT
Present appeal has been filed against judgment dt. 22.10.2013 vide which the appellant herein has been held guilty of offence u/s 630 of the Companies Act, and against order dt. 23.10.2013 vide which he has been sentenced to pay a fine of Rs.2,02,000/ i.e. @ Rs.1000/ per month with effect from Page1of10 December 1996 to September 2013.
2. The Trial Court further directed in the manner as: "In case convict vacates the quarter within time, the fine will not be recovered. If the convict will not vacate the quarter within one month from today and if he also fails to deposit the fine, the convict shall under go simple imprisonment for two months in default of payment of fine. The convict is directed to hand over the vacant and peaceful possession of the quarter in question to the complainant company within one month from today, failing which he shall undergo simple imprisonment for one year."
3. M/s Taxmaco Ltd. ( respondent herein) instituted complaint no. 1286/3 alleging commission of offence u/s 630 of the Companies Act. The accusation is that on 01.04.1971, Sh. Karan Singh appellant herein joined services of M/s Birla Cotton Spinning and Weaving Mills Ltd. (hereinafter referred to as the 'Mill') whereupon on 01.12.1978, he was alloted quarter no. 13A, situated in Shivaji Lines, Shakti Nagar, Delhi, by the mills by virtue of his employment, but even after he ceased to be an employee of the said Mill, he did not vacate the quarter allotted to him and wrongfully continued to withhold the same.
4. Upon service of summons in the complaint, accused Karan Singh put in appearance before Trial court. Prima facie case having been made out, notice for an offence u/s 630 of the Companies Act was served upon him. The accused pleaded not guilty and claimed trial.
5. In order to prove its case, complainant examined PW1 Sh. Radhey Shyam.
6. In her statement u/s 313 CrPC read with Section 281 CrPC, Karan Singh admitted the fact that he was allotted quarter in question by the mills but he Page2of10 denied that it was allotted to license basis. Plea of accused was that it was let out to him and rent used to be deducted from his salary. He admitted that the mill was closed on 30.11.196 and he joined the mill of the company at Baddi, Himachal Pradesh where he worked for about 15 months but the company discontinued his services and his dues were remained unpaid.
Accusedappellant examined in defence DW1 Sh. Om Prakash, EPFO, Wazipur Industrial Area and DW2 Sh. S. K. Gupta, Inspecting Officer Labour.
Ultimately, vide impugned judgment dt. 22.10.2013 he has been held guilty of the offence u/s 630 of the Companies Act, convicted and sentenced vide order on sentence dt. 23.10.2013.
7. Arguments heard. File perused.
8. As noticed above, case of M/s Taxmaco Ltd. complainant - respondent no.1 herein was that appellant herein was serving with M/s Birla Cotton Spinning and Weaving Mills Ltd. (the Mills) since 01.04.1971 and by virtue of his employment he was allotted Qtr.no.13A, Shivaji Lines, Shakti Nagar, Delhi on 01.12.1978.
9. In the complaint, M/s Taxmaco Ltd. alleged to have acquired proprietary rights in respect of Mill in pursuance of orders passed by Hon'ble High Court of Delhi on 03.01.83 in company petition no.59 of 1982 and further that by virtue of this scheme of arrangement the complainant company has a right to proceed and initiate proceedings U/s 630 of Companies Act.
10. Learned counsel for the appellant has challenged power of attorney Ex PW1/2 and argued that same having not been got duly proved, the complainant Page3of10 failed to establish due institution of the complaint.
As regards due institution of the complaint U/s 630 of the Act, it is case of the complainant that Sh. Radhey Shyam Sharma was authorised to file and peruse the complaint vide power of attorney Ex PW1/2.
11. A perusal of Trial Court Record would reveal that Sh. Radhey Shyam Sharma while appearing in court as PW1 proved on record copy of resolution Ex.PW1/1 and also copy of power of attorney Ex.PW1/2 executed on its basis. Original power of attorney was seen and returned. Chief examination of PW1 would reveal that no objection was raised from the side of the accused at the time these two documents were exhibited. There is also nothing on record to disbelieve execution of power of attorney by the complainant in favour of PW1 Radhey Shyam Sharma for institution of the complaint and to do all other acts as find mention therein. Therefore, this court does not find any merit in the contention of learned counsel for appellant that no reliance can be placed on the power of attorney.
Allotment of Qtr.No.13A by virtue of employment
12. While appearing in court as PW1, Radhey Shyam Sharma deposed that Sh. Karan Singh had joined services on 01.04.1971. He also deposed about allotment of a residential quarter to him vide allotment letter dt.01.12.1978 Ex.PW1/5 issued by the Mills.
As per contents of the allotment letter Sh. Karan Singh was to retain possession of the quarter in question as long as he remained in service of the company. So he was to vacate and hand over its actual and physical possession Page4of10 to the Company.
It is case of the complainant that Sh. Karan Singh ceased to be in employment of the company w.e.f.30.11.96, but he did not vacate the quarter.
Learned counsel for appellant has contended that complainant did not produce on record any document to prove factum of employment of Sh. Karan Singh.
Contents of letter dt. 01.12.1978 Ex PW1/5 vide which the aforesaid quarter was allotted to Sh. Karan Singh reveal that it was allotted on license basis for its use by him and his family members, on payment of monthly charges of Rs.7/ apart from electricity and water charges.
13. In para - 5, it was specifically mentioned that the quarter was to be vacated by the licencee on cessation of employment or on violation of any of the terms and condition of the agreement of the licence.
Letter Ex.PW1/5 bears signatures of Sh. Karan Singh. It also bears signatures of Factory Manager of Mills. No effort was made by the appellant before Trial Court to get compared the signatures available on this letter so as to prove that the letter does not bear his signatures.
14. In the course of arguments, learned counsel for the appellant has contended that in reply to a query under Right to Information Act, appellant has learnt that the land where quarter in question is situated, falls on the land which belongs to DDA, and further that in view of this fact, the appellant company is not entitled to claim possession of the quarter in question.
Page5of10 In this regard, learned counsel for the respondent has rightly pointed out that no document was placed on record by the accused before the Trial Court to suggest that the land, where the quarter in question is situated falls in DDA land. The copy of the reply received by one Ram Niwas Sharma from PIO of DDA is dated 18.06.2007. Case remained before the Trial Court upto 2013. No step was taken by the accused to produce this document before the Trial Court or to prove the same. Therefore, there is no merit in this contention learned counsel for the appellant.
15. Learned counsel for respondent has contended that the mill was closed w.e.f. 30.11.96 and Sh. Karan Singh joined services at Baddi, District Solan (H.P.) on 01.04.1971 under M/s Chambal Fertilizers and Chemical Ltd.
On the other hand, the contention raised by learned counsel for appellant is that simply because the mills was closed down and a scheme was framed by Hon'ble High Court, it cannot be said that the appellant company became entitled to seek vacation of the aforesaid quarter, the reason being that there is no document on record to suggest that the scheme, was got approved from Hon'ble High Court of Kolkata.
Ex CW1/4 is copy of order dated 03.01.1983 vide which scheme of arrangements was sanctioned by the Hon'ble High Court of Delhi as prayed. Sl. No. 5 of ScheduleII depicts that the property situated at Roshanara Road Extension, Shakti Nagar, Delhi forms part of the scheme.
It is in the statement of PW1 Sh. R. S. Sharma on 10.04.1999 accused joined M/s Chambal Fertilizers and Chemical Ltd. at Baddi.
Page6of10 It is also in his statement that the accused has left services at Baddi vide Ex PW1/6.
16. Accused in his defence examined DW1 Sh. Om Prakash, EPFO, Wazipur Industrial Area. According to this witness, account of Sh. Karan Singh was transferred to Baddi. Account of Sh. Karan Singh was finally settled on 15.01.2004.
17. In view of closure of the mill at Delhi w.e.f.30.11.1996, it can safely be said that Sh. Karan Singh ceased to be in employment of the mills at Delhi. Once Sh. Karan Singh joined Birla Mill at Baddi, District Solan (H.P.) and the mills at Delhi was closed on 30.11.96, Sh. Karan Singh was not entitled to retain possession of the aforesaid quarter at Delhi. Appellant cannot take any advantage by raising objection that the scheme was not got approved from Hon'ble High Court of Kolkata.
In Smt. Abhilasha V.K. Jain Vs. Cox & Kings and Smt. Sunita Bhagat Vs. Voltas Ltd., 1995 RLR 232 (SC), while dealing with provisions of Sec.630, Hon'ble Apex Court observed in the manner as "Sec.630 of the Act provides speedy relief to the company where its property is wrongfully obtained or wrongfully withheld by an "employee or an officer" or a "past employee or an officer" or "legal heirs and representatives" deriving their colour and content from such an "employee or officer" in so far as the occupation and possession of the property belonging to the company is concerned. The failure to deliver property back to the employer on the termination, resignation, superannuation or death of an employee, would render the "holding" of that property wrongful and actionable U/s 630 of the Act. To hold that the "legal heirs" would not be covered by Sec.630 of the Act would be unrealistic and illogical.
...............
Page7of10 If an employee or a past employee or anyone claiming the right of occupancy under them, were to continue to "hold" the property belonging to the company, after the right to be in occupation has ceased for one reason or the other, it would not only create difficulties for the company, which shall not be able to allot that property to its other employees but would also cause hardship for the employee awaiting allotment and defeat the intention of the legislature. The courts are therefore obliged to place a broader, liberal and purposeful construction on Sec.630 of the Act in furtherance of the object and purpose of the legislation and construe it in a wider sense to effectuate the intendment of the provision. The "heirs and legal representatives" of the deceased employee have no independent capacity on the property, which stood allotted to the employee or the officer concerned or resist the return of the property to the employer, in the absence of any express agreement to the contrary entered with them by the employer."
In Abhilasha V. K. Jain's case (supra), Hon'ble Apex Court further observed in the manner as: "It is immaterial whether the wrongful withholding is done by the employee or the officer or the past employee or the past offcer of the heirs of the deceased employee or the officer or any one claiming their right of occupancy under such an employee or an officer. It cannot be ignored that the legal heirs or representatives in possession of the property had required the right of occupancy in the property of the company, by virtue of being family members of the employee or the officer during the employment of the officer or the employee and not on any independent account. They, therefore, derive their colour and content from the employee or the officer only have no independent or personal right to hold on to the property of the company. Once the right of the employee or the officer to retain the possession of the property, either on account of termination of services, retirement, resignation or death, gets extinguished, they (persons in occupation) are under an obligation to return the property back to the company and on their failure to do so, they render themselves liable to be dealt with under Section 630 of the Act of retrieval of the possession of the property."
18. On cessation of employment of the appellant, it was duty to surrender vacant possession of the quarter to the Licensor, but no such step was taken by the appellant. The appellant kept on contesting prosecution in the complainant and withhold possession of the quarter without any right. Therefore, this Court Page8of10 does not find any ground to interfere with the judgment of conviction recorded by learned ACMM and the same is upheld.
19. On the point of sentence, learned counsel for appellant has submitted that Section 630 provides for imposition of fine of Rs.10,000/ only, but the Trial Court has directed the appellant to pay fine of Rs.2,02,000/ i.e. @ Rs.1000/ per month with effect from December 1996 to September 2013, which is contrary to law and as such deserves to be set aside.
Section 630 provides as under: "(1) If any officer or employee of a company
(a) Wrongfully obtains possession of any property of a company; or
(b) having any such property in his possession, wrongfully withholds it or knowingly applies it to purposes other than expressed or directed in the articles and authorised by this Act.
He shall, on the complaint of the company or any creditors or contributory thereof, be punishable with fine which may extend to ten thousand rupees.
(2) The Court trying the offence may also order such officer or employee to deliver up or refund, within a time to be fixed by the Court, any such property wrongfully obtained or wrongfully withheld or knowingly misapplied, or in default, to suffer imprisonment for a term which may extend to two years."
20. Having regard to the provisions of provisions of Subsection (1) of Sec. 630 of the Act, and decision in Kannankandi Gopal Krishna v Prakash Chand Chander Juneja & Ors 1993 Cri. L. J. 2791, relied on by Learned ACMM, Delhi, no interference is called for even on the point of sentence. The appellant is given 30 days time from today to deliver vacant and peaceful Page9of10 possession of the quarter or failing which, he shall undergo simple imprisonment for a period of one year, as ordered by the Trial Court.
Copy of this order be sent to the Trial Court for its enforcement U/s 635 of the Act, in accordance with Law, on expiry of period of 30 days.
21. In view of the above discussion, finding no merit in the appeal, same is hereby dismissed.
22. Trial Court record be returned. Appeal file be consigned to record room.
Announced in Open Court
on 21.01.2014 (Narinder Kumar )
Additional Sessions Judge(Central)/Delhi.
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