SMT. ABHILASH VINOD KUMAR JAIN ETC. versus COX AND KINGS (INDIA) LTD. AND ORS. ETC.

Citation: [1995] 2 S.C.R. 873 · Decided: 21-03-1995 · Supreme Court of India · Bench: A.S. ANAND · Disposal: Dismissed
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Judgment (excerpt)

-
SMT. ABHILASH VU-JODKUMAR JAIN ETC. 
A 
-1 v. 
COX AND KINGS (INDIA) LTD. AND ORS. ETC. 
MARCH 21, 1995 
(A.S. ANAND AND K.S. PARIPOORNAN, JJ.] 
B 
Companies Act, 1956: 
S.63lr-Allotment of premises by Company to its employeej-
Employees dying in hamess-Failure of legal heirs to hand, over vacant C 
possession-Company launching prosecution for retrieval of company's 
property-Maimainability of-Ambit and scope of S.63o-Quashing of the 
proceedings-Power of the High Court-Cr.P.C.-S.482. 
Interpretation of Statutes: 
D 
Beneficient provision-Interpretation of-Duty of Court to defend the 
law from clever· evasion and def eat and to prevent perpetration of a legal 
fraud-Court to be ever alive to this principle. 
The appellants, legal heirs of the Respondent's employee who died 
in harness, were proceeded against by the respondent-employer under E 
S.630 of the Companies Act, 1956 for their failure to hand over vacant 
possession of the premises allotted to the said employee. 
The appellant filed petitions under S.482 Cr.P.C •. seeking quashing 
of the proceedings on the ground that the provisions of S.630 of the 
Companies Act cannot be invoked against the legal heirs of a deceased F 
employee who died in harness and as such the complaint against them 
under S.630 of the Act was not maintainable. The High Court dismissed 
their petitions filed under S.482 Cr.P.C. Hence these appeals. 
Dismissing the appeals, this Court. 
G 
J 
HELD:l.1. A petition under Section 630 of the Companies Act is 
maintainable against the legal heirs of the deceased officer/employee for 
retrieval of the company's property wrongfully withheld by them after the 
demise of the employee concerned. The High Court was, therefore, right in 
dismissing the petitions filed by the appellants under Section 482 Cr.P.C. H 
873 
874 
SUPREME COURT REPORTS 
[1995] 2 S.C.R. 
.A and declining to quash the proceedings initiated by the employer of the 
deceased employees for retrieval of the company's property under Section 
630 of the Act. [886-E] 
1.2. Clause( a) of Section 630.(1) is self-contained and independent of 
Clause(b) with the capacity of creating penal liability embracing the case 
B of an existing employee or officer of the company and includes a past 
officer or. a past employee of the company. Clause(b) is equally inde-
pendent and distinct from Clause(a) as regards penal consequences and 
it squarely applies (o the cases of past employees or officers. The entit~e
ment of the officer or employee to the allotted property of the company is 
C contingent upon the right and capacity of the officer or the employee by 
virtue of his employment to continue in possession of the property belong-
ing to the company, under authority of the company and the duration of 
such right is co-terminus with his/her employment. [881-G-H, 882-A-B] 
D 
1.3 Th.e legal representatives of the heirs of a deceased employee or 
officer would squarely fall within the ambit of Section 630 of the Act. To 
exclude them, by giving a restrictive interpretation to the provisions would 
defeat the very object of the provision which declares the wrongful withhold-
ing of the property of the company to be an offence. It is immaterial whether 
the wrongful withholding is done by the employee or the officer or the past 
E employee or the past officer or the heirs of the deceased employee or the 
officer or anyone 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 acquired the right of occupan~ in the 
property of the company, by virtue of being family members of the employee 
F of 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 and indep.endent 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 
G 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. [883-D-H] 
H 
1.4 Even though Section 630 of the Act falls in Part- XIII of the
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