SURINDER ARORA Vs. DURGA DAS

JUDGEMENT

(1.) On 9-12-1981, Shri Surinder Arora, an ex- employee of M/s. Associated Traders and Engineering Limited, 20/1, Asaf Ali Road, New Delhi, filed a complaint in the court of the concerned Metropolitan Magistrate, for initiation of proceeding under Sections 406 and 418 of the IPC, against the Managing Director, three Directors, the Deputy General Manager (Finance), an accountant and Shri P.K. Seth, a partner of the firm of Chartered Accountants of the Company.

(2.) The case of the petitioner as disclosed in the complaint is that accused Nos. 1 to 5 created an approved Gratuity Fund and named it as "Associated Traders and Engineers Employees Gratuity Fund" and in compliance with the provisions of Section 40A(7) of the IT Act opened an account with the Andhra Bank, AsafAli Road, New Delhi. The accused Nos. 1 to 6, however, never deposited the amount of the fund in the Post Office Saving. Bank Account or as prescribed under Rule 67(1) and (2) of the IT Rules.. The accused, thus knowingly and intentionally contravened the terms of the irrevocable trust. It is his further case that the gratuity amount deposited in the approved gratuity fund belong to the employees of the company and is payable under the Payment of Gratuity Act, 1972. This amount cannot be used by the employer in any other manner. The company, however, has misappropriated and converted to its own use the above said fund. It is contrary to law. By not fulfilling their statutory obligations, the officers of the company had made themselves liable to the penal consequences. The accused be summoned and punished according to law.

(3.) In support of the complaint, the petitioner examined himself and produced Sarvashri G.KDua. S.K. Sharma and N.K.. Khattar, employees of the company. The Id. lower court on consideration of the oral as well as the documentary evidence came to the conclusion that even if the facts of the complaint are taken on their face value, no criminal liability can be fixed on the Deputy General Manager (Finance), the Accountant and the partner of the Chartered Accountant firm of the company, as they did not play any part in the misappropriation, if any, of the Gratuity Fund amount. As regards the Managing Director and the Directors of the company, the finding is that the complainant has miserably failed to bring his case within the four corners of the offence referred to above, inasmuch as there is no positive evidence to suggest that the accused Nos. I to 4 have either converted the amount in question to their own use or have not deposited the gratuity amount in savings bank account of any recognised scheduled bank as required under the IT Act and the rules framed thereunder. Furthermore, the gratuity fund amount shown iii the balance sheet only indicates the liability of the company towards its employees to that extent. It is not a circumstance to prove that the accused have either violated the provisions of the trust, or the obligations arising under the IT Rules. On these findings, the complaint was dismissed. It is against this order that the complainant has filed the present petition.