LexV.M. SHAH versus THE STATE OF MAHARASHTRA AND ANR.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
V.M. SHAH
v.
THE ST ATE OF MAHARASHTRA AND ANR.
AUGUST 25, 1995
[K. RAMASWAMY AND B.L. HANSARIA, JJ.]
Companies Act, 1956 : Section 630.
Company-property of-Withholding by employee-Prosecution
f or--Conviction by Criminal Cowt-Civil Cowt's finding that employee had
independent tenancy 1ights and not through company-Held until set aside by
Appellate Cowt the finding recorded by Civil Cowt get precedence over
findings of Climinal Cowt-Conviction under section 63(}-Held wzsus-
tainable.
Respondent 2-Company instituted proceedings against its appellant-
employee under section 408 of the Indian Penal Code and Section 630 of
the Companies Act, 1956 on the ground that the latter had failed to deliver
possession of the flat which was given to him during the course of his
employment. The Trial Court convicted the appellant under section 630.
The appellate Court confirmed that conviction but altered the sentence.
The High Court confirmed the order of the appellate Court.
During the pendency of the criminal proceedings, the Company filed
a suit in the small Causes Court for eviction of the appellant, pleading
that the Company had tenancy rights in the flat in question which was
given to the appellant in lieu of his services on leave and licence basis.
Consequently upon his resignation he was enjoined to deliver possession
of the flat to the Company. The appellant contested the suit on the ground
that he was not in occupation of the flat as employee of the Company but
A
B
c
D
E
F
had independent tenancy rights. Rejecting the Company's case, the Trial G
Court dismissed its suit and held the appellant had proved that he had
independent tenancy rights. Against this order, the Company preferred an
appeal, and it is pending.
In appeal to this Court on the c1uestion whether the appellant's
conviction under section 630 was sustainable :
79
H
A
B
80
SUPREME COURT REPORTS [1995] SUPP. 3 S.C.R.
Allowing the appeal, this Court
HELD : 1. It cannot be said that the appellant has been in wrongful
possession of the property entailing his conviction and punishment under
section 630 of the Companies Act and requiring handing over of the
possession of the flat. [84-D]
2. The civil court after full dressed trial, recorded the finding that
the appellant had not come into possession through the company but had
independent tenancy rights from the principal landlord and, therefore, the
decree for eviction was negatived. Until that finding is duly considered by
C
the appellate court after weighing the evidence afresh and, if so warranted,
reversed, the. findings bind the parties. The findings, recorded by the
criminal court, stand superseded by the findings recorded by the civil
court. Thereby, the findings of the civil court get precedence over the
findings recorded by the criminal court, in particular, in summary trial
for offences like the one under section 630. The mere pendency of the
D appeal does not have the effect of suspending the operation of the decree
of the civil court; and neither the finding of the civil court gets disturbed
nor the decree becomes inoperative. [83-H; 84-A-C]
Baldev Klis/ma v. Shipping C01poration of India Ltd., AIR (1987) SC
E
2245; Atul Mathur v. Atul Kalra & Anr., [1989) 4 SCC 514; Gokak Patel
Vo/kart Ltd. v. D.G. Hiremath & Ors. JT (1991) 1 SC 376 and M.S. Shliff v.
State of Madras, AIR (1954) SC 397, referred to.
F
CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
1011 of 1995.
From the Judgment and Order dated 28.4.95 of the Bombay High
Court in Crl. No. 1222 of 1995.
Santosh Hegde, P.K. Dey, Ms. Rani Jethmalani and A.A. Khan for
G
the Appellant.
V.P. Vashi and K.J. John for the Respondents.
The following Order of the Court was delivered :
H
Leave granted.
r
V.M. SHAH v. STATE
81
This appeal by special leave arises form the judgment and order A
dated April 28, 1995 by the Bombay High Court in Criminal Application
No. 1222 of 1995. The appellant had joined the services of M/s. Rallis India
Ltd. on march 10, 1965. He had occupied a residential flat at Morena No.
11, M.C. Dhanuka Road, Bombay. The resigned on July 15, 1986. The
Rallis India Ltd., the second respondent ('the company' hereinafter), in-
B
itiated proceedings in January, 1987 against the appellant under s.408 IPC
and s.630 of the Companies Act for· the continued occupation of the
appellant in the said flat. The Magistrate, by his order dated October 12,
1994, founExcerpt shown. Read the full judgment & AI analysis in Lexace.