PARRY AGRO INDUSTRIES LIMITED Vs. S SEKAR

JUDGEMENT

(1.) THIS Criminal Original Petition is filed to direct the respondent to deliver the Company quarters in D. No. 6/626, Paralai Estate, Valparai on the cessation of his Employment arising out of his resignation to the petitioner Company.

(2.) THE brief facts, which are essential for disposal of this Criminal Original Petition, are as follows:THE respondent was accommodated in the Company quarters at D.No,6/626, Paralai Estate, Valparai, while he was in service. On his resignation on 9.9.2003, it was accepted by the petitioner Company and the respondent ceased to be its staff and was bound to vacate the said quarters. As he had failed to do so, he was tried in C.C.No. 1 of 2004 for the offence under Section 630(1) of the Companies Act (herein after referred to as the Act), I as he was in continuous wrongful possession of the quarters even after the extended time given to him. After trial, the respondent was found guilty under Section 630(1) of the Act by the learned Magistrate and the respondent, was directed to pay a fine of Rs. 5.000/-, in default to undergo two weeks simple imprisonment. However, the Magistrate did not pass any order for delivery of vacant possession of the said quarters. Hence, this Criminal Original Petition has been filed.

(3.) THE learned counsel for the petitioner placed reliance on the decision of the High Court of Calcutta in the case of Metal Box (India) Limited v. State of West Bengal 1999-III-LLJ-Supp-1349 in support of his contention that having found the accused guilty under Section 630 of the Companies Act, the learned Magistrate ought to have passed an order, directing him to deliver vacant possession of the quarters to the Petitioner company. After referring to the decisions of the Honourable Supreme Court in the cases of Baldev Krishna Sahi v. Shipping Corporation of India Limited AIR 1987 SC 2245: (1987)4SCC 361: 1988-II-LLJ-202(SC) and Shrimathi Abhilash Vinodkumar Jain v. Cox Kings (India) Limited 1996-III-LLJ-Suppl-354, the High Court of Calcutta has observed that the object of provisions of Section 630 of the Act is to retrieve the property of the Company and that even though the provisions are penal in nature, the object of the provision is required to be given a purposive interpretation so as not to choke the beneficient provision. THE relevant paragraphs are extracted as under:-THE logical deduction of the analysis of Section 630 of the Act in the light of the law laid down by the Supreme Court, is that the entitlement of the officer of employee to the allotted property of the Company is contingent upon the right and capacity of the offence of upon the employee by virtue of his employment to continue in possession of the property belonging to the Company, under authority of the Company and the duration of such right coterminous with his/her employment.THE capacity, right to possession and the duration of occupation are all features which are integrally blended with the employment and the capacity and the corresponding rights are extinguished with the cessation of employment and an obligation arises to hand over the allotted property back to the Company. Where the property of the Company is held back whether by the employee, past employee or anyone claiming under them, the retained possession would amount to wrongful withholding of the property of the company, actionable under Section 630 of the Act.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 for retrieval of the possession of the property.Even though Section 630 of the Act falls in Part XIII of the Companies Act and provides for penal consequences for wrongful withholding of the property of the Company the provisions strictly speaking, are not penal in the sense as understood under the penal law. THE provisions are quasi-criminal. THEy have been enacted with the main object of providing speedy relief to company when its property is wrongfully obtained or wrongfully withheld by an employee.-6. In the above said decisions, the Honourable Supreme Court has consistently held that the provisions under Section 630 of the Companies Act are quasi criminal and they had been enacted with the main object of providing speedy relief to a Company, when, its property is wrongfully obtained or wrongfully withheld by an employee. By applying the said principle and the ratio enunciated in the above said decisions of the Honourable Supreme Court, it is found that the Company-s right to retrieve its property is quite explicit and the stand of the employee or anyone claiming through him to continue his possession is baseless. THErefore, the Magistrate, who tried the offence against the respondent under Section 630 of the Companies Act ought to have passed appropriate orders to retrieve the property from the Respondent and hand it is over to the petitioner and having failed to exercise the discretion judicially, it warrants interference by this Court and suitable direction has to be issued. Accordingly, the respondent is directed to vacate the quarters in D. No. 6/626, Paralai Estate, Valparai and hand over vacant possession of the same to the petitioner Company, within a period of four weeks from today and this Criminal Original Petition is allowed.