Delhi District Court
M/S Texmaco Ltd. vs Ratti Ram (Through Lr) on 20 October, 2011
IN THE COURT OF SH. AJAY GUPTA ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE (SPL. ACTS): CENTRAL
TIS HAZARI COURTS, DELHI
M/s Texmaco Ltd. vs Ratti Ram (through LR)
U/s 630 of Companies Act, 1956
JUDGEMENT CC No. 2262/3
(a) Serial no. of the case : 02401R0027061993
(b) Date of commission of offence: On/after 19.01.92 continuously
(c) Name of complainant : M/s Texmaco Limited
Belgharia Calcutta
Prop. of M/s Birla Textiles
PO Birla Lines, Delhi07
(d) Name, parentage, residence: Ratti Ram (now deceased)
through LR Ravi Dutt
r/o Q.No.19B Shivaji Lines,
Shakti Nagar, Delhi
(e) Offence complained of/ proved : U/s 630 of Companies Act
(f) Plea of accused : Pleaded not guilty.
(g) Final order : Convicted.
(h) Date of such order : 20.10.11
Date of Institution : 17.05.93
Date of Reservation of Judgment: 18.10.11
Date of Pronouncement of Judgment: 20.10.11
Brief statement of the reasons for the decision:
1.The complainant company, M/s Texmaco Ltd. had filed the present complaint u/s 630 of the Companies Act, 1956, against late Ratti Ram alleging that on 18.01.52 he had joined the services of erstwhile company M/s Birla Cotton Spinning and Weaving Mills Ltd. and on 01.01.77, he was allotted the Qr. No. 19B, Shivaji Line, Shakti Nagar, Delhi, as a licensee. It is further alleged, that Texmaco vs Ratti Ram (through LR) 1 by virtue of a scheme of arrangement dated 03.01.1983, arrived at between the present complainant and M/s Birla Cotton Spinning & Weaving Mills Ltd. and pursuant to the order passed by Hon'ble Delhi High Court, the present complainant became the owner of the concerned Birla Mill Unit where the accused was working along with all its employees and the properties, including the property in question. Pursuant to the said arrangement, all the agreements, more particularly, licence agreement entered between M/s Birla Cottons Spinning and Weaving Mills Ltd. with third parties are deemed to be entered between the complainant company and those third parties. Complainant company also acquired all the rights, titles, interests in the properties of the mill and the housing colonies of the mill unit of the said M/s Birla Cottons Spinning and Weaving Mills Ltd. and all the employees of the said mill unit of M/s Birla Cottons Spinning and Weaving Mills Ltd., became the employees of the present complainant company pursuant to the said scheme of arrangement. It is alleged that uptill 19.01.92, late Ratti Ram remained in the services and thereafter he was terminated from the services of the company, thus, after cessation of his service late Ratti Ram was to vacate and hand over the aforesaid quarter to the complainant but he failed to do so. Thus, it was prayed that accused may be directed to hand over the possession of the aforesaid quarter and he may be punished in accordance with law.
2. After summoning of late Ratti Ram for the said offence, a notice for the offence U/s 630 of the Companies Act was given to him in terms of Section Texmaco vs Ratti Ram (through LR) 2 251 Cr.P.C., to which he pleaded not guilty and claimed trial.
3. In order to substantiate its allegation, the complainant examined as many as three witnesses i.e Sh. R.L. Goel, Chief Estate Officer as PW1, Sh. OP Jain, Estate Supervisor as PW2 and Sh. Sat Dev Gupta as PW3.
4. During the course of trial late Ratti Ram expired on 04.02.2000 and on the application of complainant's application LR Ravi Dutt was brought on record. Now this judgment is directed only against LR Ravi Dutt.
5. On 03.05.05 fresh notice u/s 251 Cr.P.C was given to the LR Ravi Dutt for the offence punishable u/s 630 of Companies Act to which he pleaded not guilty and claimed trial.
6. Thereafter complainant examined Sh. Radhey Shyam Sharma, attorney of the complainant as PW1. In his statement PW1 deposed that he is attorney of the complainant company and duly authorised to sign, verify the complaint and to depose in the present case vide resolution Ex. PW1/1 and power of attorney Ex. PW1/2. He also proved the certificate of incorporation Ex. PW1/3 and scheme of arrangement Ex. PW3/4 through which the complainant company became owners of the quarter as well as employee of late Ratti Ram and deposed that late Ratti Ram joined the service of company on 18.01.52 and by virtue of his employment, quarter in question vide allotment letter Ex. PW1/5 Texmaco vs Ratti Ram (through LR) 3 was allotted to him. He further deposed that late Ratti Ram ceased to be in the employment w.e.f. 19.01.92 and thus he was liable to vacate the quarter after cessation of his service. He further deposed that during his life time late Ratti Ram and after his demise his LR Ravi Dutt is withholding the quarter wrongfully.
7. Thereafter, statement of LR Ravi Dutt recorded u/s 313 Cr.P.C. In his statement LR Ravi Dutt did not deny that late Ratti Ram joined M/s Birla Cotton Spinning and Weaving Mills Limited and quarter in question was allotted to late Ratti Ram through Ex. PW1/5. He also did not deny that late Ratti Ram ceased to be in the employment w.e.f 19.01.92. However, he stated that late Ratti Ram is residing in the property in question since 1949 prior to joining of his service. He further deposed that his father was an independent tenant in the aforesaid quarter and rent was being deducted from his salary. He further stated that aforesaid allotment letter is forged and fabricated document.
8. I have heard the Ld. Counsel for the complainant company as well as LR Ravi Dutt and gone through the record of the case. I have also gone through the written arguments as well as citations filed on behalf of parties.
9. While dealing with the case U/s 630 of Companies Act, this court is to go by the following guidelines which are laid down by the Hon'ble Bombay High Texmaco vs Ratti Ram (through LR) 4 Court in the following case: "1993 CRI. L.J. 2791 " K.G.K. Nair v. P.C. Juneja"
The provisions of S.630 are intended to provide speedy and efficacious redress in cases where company's property is wrongfully withheld and therefore the following guidelines are required to be observed:
(a) That the complaints be taken up and disposed of on a priority basis, the accent being on the avoidance of any unwarranted delay.
(b) That the trial Courts should address themselves to the fact that the scope of the enquiry in a proceeding under Section 630 is extremely restricted in law and, consequently, the parties be confined within those narrow ambits without being permitted to dilate or protract the proceeding through extraneous avenues.
(c) That no frivolous application for adjournment, stay of proceedings, etc., should be permitted by the trial Courts because the history of those proceedings indicate that each of such states is responsible for further litigation and years of delay. The pendency of other civil proceedings is no bar to the decision of an application under S. 630 which fact should be taken cognizance of in such situations.
(d) That the appeal, i.e., Court of Session, in the first instance, must judiciously scrutinize and vigorously examine the revision applications and appeal before granting stay orders.
(e) That applications for discharge on frivolous and untenable pleas are required to be speedily and effectively disposed of and are not to be used as handles for protracting the litigation".
10.For proving the offence u/s 630 of Companies Act, complainant company was required to establish on record the following ingredients:
(a) That the complainant company is registered under the Companies Act;
(b) That the complainant company is the owner of quarter in question and there exists/existed the relationship of employer and employee between the complainant company and accused;
(c) That the accused was allotted quarter in question on licence basis;
(d) That the accused was ceased to be employee of the complainant company
(e) That the accused has wrongfully withheld the quarter in question. Texmaco vs Ratti Ram (through LR) 5 Point (a) That the complainant company is registered under the Companies Act
11.It is clear from the ex. PW1/3 that the Complainant Company is registered under the Companies Act. Even otherwise factum of complainant company's incorporation is not in dispute.
Point(b) That the complainant company is the owner of quarter in question and there exists/existed the relationship of employer and employee between the complainant company and accused;
12.In his statement recorded u/s 313 Cr.P.C LR Ravi Dutt admitted that late Ratti Ram was employee of M/s Birla Cotton Spinning and Weaving Mills Ltd. PW1 Mr. Radhey Shyam deposed that by virtue of scheme of arrangement Ex. PW1/4 the complainant company became owner of the quarter in question as well as employer of late Ratti Ram. Though, LR has denied this fact and stated that this scheme of arrangement is false and bogus as late Ratti Ram was not a party to this scheme of arrangement. However, Ld. Counsel for complainant submitted that this scheme of arrangement is not in regard to a particular person and it pertains to whole employee of M/s Birla Cotton Spinning and Weaving Mills Limited as well as its entire property. Ld. Defence counsel further argued that complainant is not the owner of the quarter in question, therefore, complainant has no locus standi to file the present complaint against the accused. He further argued that in pursuance to the aforesaid order the complainant was required to do certain acts and a certified copy of the order of Hon'ble Delhi High Court was to be submitted with ROC, Calcutta. However, they have not fulfilled these requirements, therefore, this order has no Texmaco vs Ratti Ram (through LR) 6 application and complainant company cannot claim ownership by virtue of this order. This court does not find any substance in the submissions of Ld. counsel for accused. It is clear from the perusal of order the Hon'ble High Court that no further act was required even otherwise. This scheme of arrangement has not been challenged hence it became final. Relevant para of the order of Hon'ble High Court reads as under which clarifies that the complainant company had become the owner of the i.e. M/s Birla Cottons Spinning and Weaving Mills Textiles as well as quarter in question.
(1)That all the property, rights, and powers of the said transferor company specified in the first, second and third parts of the Schedule II hereto and all the other property, rights and powers of the said transferor company be transferred without further act or deed to the said transferee company and accordingly the same shall, pursuant to section 394(2) of the Companies Act, 1956, be transferred to and vest in the said transferee company for all the estate and interest of the said transferor company for all the estate and interest of the said transferor company therein but subject nevertheless to all charges now affecting the same, and (2) That all the liabilities and duties of the said transferor company by transferred without further act or deed to the said transferee company and accordingly the same shall, pursuant to section 394(2) of the Companies Act, 1956, be transferred to and become the liabilities and duties of the said transferee company: and (3) That all proceedings now pending by or against the said transferor company be continued by or against the said transferee company; and (4) all contracts, deeds, bonds, agreements and instruments of whatever kind or nature relating to the said units of M/s Birla Cottons shall continue to be in full force and effect against or in favour of Texmaco as the case may be and enforced as fully and effectively as if Texmaco instead of Birla Cotton had been a party thereto.
13.Thus, it is clear from the perusal of the order passed by Hon'ble Delhi High Court that complainant company has become the owner of all the properties of Texmaco vs Ratti Ram (through LR) 7 the unit of M/s Birla Cottons Spinning and Weaving Mills Ltd. without any further Act or Deed and said quarter stood transferred and vested with the complainant company for all the estate and interests. Thus, complainant company has become the owner of the property in question and has got every right to prosecute with this complaint.
14.Moreover, in "AIR 2007 Delhi 147, Kamla Rani and Ors vs M/s Texmaco Ltd." Hon'ble High Court has relied on the same scheme of arrangement Ex. PW1/4 and hold that the entire assets of M/s Birla Cottons Spinning and Weaving Mills Ltd. stood transferred to M/s Texmaco Ltd. and therefore said company was the successorininterest of M/s Birla Cottons Spinning and Weaving Mills Ltd.. Thus, it is clear that the complainant company became owner of all the property, rights and powers in the mill unit of transferee company without any further act or deed and by virtue of scheme of arrangement Ex. PW1/4, complainant company became owner of the property in question, therefore, they have every right to prosecute this complaint. In view of the aforesaid discussions, the relationship of employer and employee also stands proved.
Point(c) That the accused was allotted quarter in question on licence basis
15.Complainant company was required to establish on record that late Ratti Ram was the licensee of the complainant company. Complainant's witnesses have clearly deposed that the late Ratti Ram was allotted quarter in question on licence basis through allotment letter Ex. PW1/5. LR/accused has disputed this Texmaco vs Ratti Ram (through LR) 8 fact and he has taken a specific plea that late Ratti Ram has been residing in the aforesaid quarter prior to his employment and quarter in question was given to late Ratti Ram on rent. However, he did not produce any document (i.e rent receipt, rent deed etc.) to show that he was an independent tenant in the said quarter. He has also not produced any evidence or document to show that late Ratti Ram was residing in the said quarter prior to his employment with the company. Accused/LR has simply claimed that late Ratti Ram was a tenant in the said quarter, however, he has not lead any evidence to show that late Ratti Ram was a tenant in the quarter in question. Furthermore, it has been held by the Hon'ble High Court that a tenancy is always created by a contract and for creating the contract of tenancy, both the parties i.e. landlord and tenant must be at adidem. Thus, in view of the law laid down by the Hon'ble Delhi High Court in "2009 (160) DLT 171, Viran Devi vs. S. Subhash"
accused ought to have established on record the contract of tenancy, however except a bald statement nothing is proved on record to show that there exists a tenancy agreement between the parties. In view of the aforesaid discussion it is held that late Ratti Ram was a licensee and complainant is the licensor. In view of the aforesaid discussion it is held that late Ratti Ram was a licensee and complainant was the licensor.
Point(d) & (e) "That the accused was ceased to be employee of the complainant company"
"That the accused has wrongfully withheld the quarter in question"
16.In his statement PW1 Radhey Shaym deposed that service of accused came to an end w.e.f 19.01.92 and this fact has not been denied by LR Ravi Dutt in Texmaco vs Ratti Ram (through LR) 9 his statement recorded u/s 313 Cr.P.C. Thus, it is held that services of late Ratti Ram was terminated w.e.f 19.01.92. Now let us see whether the complainant company has established that earlier late Ratti Ram and after his demise his LR Ravi Dutt is wrongfully withholding the quarter. As per contents of allotment letter, the late Ratti Ram was to remain in possession of the quarter till he was in the services of the company and after cessation of his service accused was to vacate and hand over the quarter to the complainant company. This fact is also not denied by LR Ravi Dutt in his statement. Thus, after cessation of his service late Ratti Ram was under obligation to vacate and hand over the possession of quarter in question which he failed to do so. It is not denied that earlier late Ratti Ram and after his demise, his LR Ravi Dutt is still occupying the quarter. Since, late Ratti Ram did not vacate and hand over the possession of the quarter in question after cessation of his service thus, it is held that earlier late Ratti Ram and after his demise his LR Ravi Dutt is wrongfully withholding the quarter in question.
17.Ld. defence counsel further argued that the power of attorney and resolution in favour of the complainant is not proved in accordance with law and it does not comply with the provisions of Power of Attorney Act. The persons who delegated his power to the alleged attorney did not file his power to delegate. It is also argued that the resolution regarding power of attorney in favour of complainant has not been proved. The complainant is stranger to the company, therefore, no resolution could have been passed in favour of the Texmaco vs Ratti Ram (through LR) 10 complainant. However, this court does not find any force in his submissions. Accused has objected this power of attorney for the first time at the fagend of the trial and has not raised objection at the time of exhibiting this power of attorney i.e Ex. PW1/2. Perusal of power of attorney placed on record shows that it has been perfectly and legally notarized and it fulfills all the ingredients of section 85 of Indian Evidence Act. Section 85 of the Indian Evidence Act clearly provides that once there is a duly notarized power of attorney then it shall be presumed to be true unless the contrary is proved. Accused has not produced any ingredients to disprove the power of attorney. This court is supported with the law laid down by the Hon'ble Supreme Court in "AIR 1971, SC 761, Jugraj Singh vs Jaswant Singh" and "AIR, 1982 Delhi 4897, Citibank N.A., New Delhi vs Juggilal Kamlapat Jute Mills ©. Ltd." in which it has been held that execution of power of attorney by a Bank's Executive Officer and Cashier delegating certain powers to one employee and documents bearing Bank's seal and attested by Notary Public raises presumption that power of attorney is executed by the bank.
18.Ld. defence counsel further argued that the complainant is the encroacher over the government land and property in question belongs to Government, hence present proceedings is not maintainable against the accused. Same point came up for consideration before the Hon'ble Delhi High Court in "AIR 2007 Delhi 147, Kamla Rani and Ors vs M/s Texmaco Ltd" case. It has been held by the Hon'ble High Court in this matter that ...ownership is not Texmaco vs Ratti Ram (through LR) 11 relevant for the reason a person may be a landlord without being an owner. ...A tenant who accepts a person as his landlord is estopped from questioning the title of his landlord. As per section 116 of Evidence Act, the tenant is estopped from disputing the title of his landlord over the premises let out to him. It is settled law that a company may take premises on lease from the owner with a permission to induct its employee as a tenant/licensee. Furthermore, as per the orders of Hon'ble Supreme Court, 68% of the land had to be handed over to DDA and remaining 32% vested in the company.
19.Ld. counsel for complainant submitted that other accused persons were also convicted by the Ld. Predecessor Courts of Ld. ACMM on the basis on similar complaints filed by the present complainant. He further submitted that these orders have been upheld by the Hon'ble High Court and Hon'ble Apex Court in the following cases: Crl. Rev. P. No. 233/2010, as Lakhan Singh vs Texmaco No. 2057/06, as Kanta Devi vs Texmaco.
"SLP (Crl.) 5216/06"
2006[3] JCC 1964, Mohan Singh vs M/s Texmaco & Anr.
Crl.Rev. Petition No.21/2011, Khajan Singh vs State & Anr. CRL.M.C.80/2011, Kusum Lata vs Texmaco Ltd.
CRL.REV.P.380/2010Bhura Mal Thr. Its LR's Chander Kant vs State & Anr.
CRL.REV.P.789/2006 & CRL.REV.P.790/2006
20.Thus, in view of these discussions it is held that complainant has established that late Ratti Ram was allotted the aforesaid quarter on licence basis by virtue of his employment. It is further held that services of late Ratti Ram came to an end w.e.f 19.01.92 on his retirement from the services and after cessation of his service he failed to vacate and hand over the possession of the quarter in Texmaco vs Ratti Ram (through LR) 12 dispute to the complainant. In such, circumstances it is held that during his life time late Ratti Ram and after his demise, his LR Ravi Dutt is wrongfully withholding the quarter of the complainant company after cessation of service of late Ratti Ram. Accordingly, LR Ravi Dutt is held guilty and convicted for the offence u/s 630 of the Companies Act 1956.
(AJAY GUPTA) ACMM(SPECIAL) ACTS, CENTRAL TIS HAZARI COURTS DELHI Announced in open court on 20.10.11.
Texmaco vs Ratti Ram (through LR) 13