http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 3  

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

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 3  

[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,

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 3  

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