Karnataka High Court

Mr.Satteppa Balappa Pujeri vs Forbes Gokak Limited on 25 March, 2022

Bench: Mohammad Nawazpresided Bymnj

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           IN THE HIGH COURT OF KARNATAKA
                   DHARWAD BENCH

         DATED THIS THE 25TH DAY OF MARCH, 2022

                         BEFORE:

        THE HON'BLE MR. JUSTICE MOHAMMAD NAWAZ

       CRIMINAL REVISION PETITION No.100088 OF 2020


BETWEEN:

MR. SATTEPPA BALAPPA PUJERI,
AGE: 46 YEARS, OCC:SERVICE,
R/O. H.NO.15/9, GOKAK FALLS,
GOKAK TALUK, BELGAVI DISTRICT - 591 308.
                                            ... PETITIONER

[BY SRI. M.J. PEERJADE, ADVOCATE]

AND:

FORBES' GOKAK LIMITED,
A COMPANY REGISTERED UNDER
THE INDIAN COMPANY'S ACT
HAVING ITS' REGISTERED OFFICE
AT FORBES BUILDING,
CHARANJIT RAI MARG, MUMBAI-I,
AND HAVING ITS MILL AT GOKAK FALLS,
REPRESENTED BY B. SATISH DEPUTY GENERAL MANAGER,
(PERSONEL) AND P.A. HOLDER,
PRINCIPAL OFFICER, GOKAKMILLS,
GOKAK FALLS, GOKAK TALUK,
BELGAVI DISTRICT - 591 308.
                                          ... RESPONDENT

[BY SRI. Z.N. HANSI, ADVOCATE]

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      THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 R/W 401 OF CR.P.C., PRAYING THAT THE IMPUGNED
JUDGMENT OF CONVICTION AND SENTENCE PASSED AGAINST THE
PETITIONER OF THE OFFENCE UNDER SECTION 630(1)(b) &
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SECTION 630(2) OF THE COMPANIES ACT BY THE PRINCIPAL CIVIL
JUDGE AND JMFC COURT, GOKAK IN C.C.NO.1270/2008 AND
CONFIRMED IN APPEAL BY THE XII ADDITIONAL DISTRICT AND
SESSIONS JUDGE, BELAGAVI SITTING AT GOKAK IN CRIMINAL
APPEAL NO.127/2016 BE KINDLY SET ASIDE AND THE PETITIONER
MAY KINDLY BE ACQUITTED OF THE SAME.

     THIS CRIMINAL REVISION PETITION PERTAINING TO
DHARWAD BENCH, HAVING BEEN HEARD AND RESERVED FOR
ORDERS ON 17.02.2022 AND COMING ON FOR PRONOUNCEMENT
THROUGH VIDEO CONFERENCE AT BENGALURU BENCH THIS DAY,
THE COURT PRONOUNCED THE FOLLOWING:

                         ORDER

This Criminal Revision Petition is preferred against

the judgment and order dated 11.08.2016 passed by the

Court of the Principal Civil Judge and JMFC, Gokak in

C.C.No.1270/2008, confirmed by judgment and order

dated 02.11.2017 passed in Criminal Appeal

No.127/2016 by the Court of XII Additional District and

Sessions Judge, Belgavi sitting at Gokak.

2. Heard both side and perused the material on

record.

3. The brief factual matrix of the case are that,

the respondent/complainant is a company registered

under the Companies Act having its registered office at

Forbes Building, Charanjit Rai Marg, Mumbai and it has

been running Textile Mill in the name and style 'Gokak

Mills' at Gokak. The company constructed about 1,500

quarters for the residence of its employees and the

quarters were allotted to the employees of the

complainant for their residence along with their family

members during the tenure of their service in the Mills.

The company has been supplying free water and

electricity with nominal charges. The employees who

were allotted the residential quarters are supposed to

use and occupy the same during the tenure of their

service and on termination of their service either by way

of retirement, dismissal or resignation, they are required

to quit and deliver the vacant possession of the

company's quarter to the company, to its duly authorized

agents, in accordance with law.

4. In the instant case, the accused joined the

service in the complainant Mills on 18.11.1986 and

during his tenure as an employee of the company, he

was allotted a residential quarter bearing No.15/9 for his

occupation as a licensee. The accused executed an

agreement in favour of the company on 01.05.1992,

attested by two witnesses and as per the agreement, he

is required to vacate the quarter within ten days from

the date of termination of his service. The accused

occupied the quarter and paid the worker dwelling fees.

The accused was dismissed from service on 28.02.2002

and after his dismissal, he was required to handover the

vacant possession of the said quarter to the

complainant-company, but inspite of several letters, he

did not vacate the quarter. Therefore the company

issued a legal notice on 15.12.2006 calling upon him to

vacate the above said quarter and handover the

possession to the complainant-company. However, the

accused refused to vacate and deliver the vacant

possession of the quarter, which amounted to wrongly

withholding the company property attracting an offence

punishable under Section 630(1) (b) (2) of the

Companies Act, 1956 ('Act' for short) punishable under

Section 630 of the Act.

5. The complainant got examined two witnesses

and got marked 9 documents before the trial Court. On

considering the oral and documentary evidence on

record, the learned Magistrate was pleased to pass an

order sentencing the accused to pay a fine of Rs.5000/-

(Rupees Five Thousand only) under Section 630(1)(b) of

the Act and in default to pay the fine amount, to undergo

simple imprisonment for a period of three months.

6. The accused was also directed to vacate the

company premise bearing No.15/9 under Section 630(2)

of the Act within one month from the date of order,

failing which, to further undergo simple imprisonment for

a period of one year.

7. The learned Sessions Judge dismissed the

appeal preferred by the accused, thereby confirming the

judgment and order passed by the learned Magistrate.

8. Assailing the concurrent findings and the

impugned orders, the learned counsel appearing for the

revision petitioner has contended that both the Courts

have fell in error in passing the order which is contrary to

material and evidence on record. His contention is that

the quarters alleged to have been in the possession of

the complainant as lessor have fallen to the Town

Municipal Council, Konnur and the leasehold area belongs

to the Government and therefore the company has no

right to initiate proceedings and it is only the

Government which ought to have filed the complaint. It

is contended that some of the employees have filed writ

petition for cancellation of the notified area which was

decided in their favour and the area has been merged

into Hennur village Panchayath and therefore the

respondent is no more the employer and cannot file a

complaint under Section 630 of the Act.

9. The above contention of the learned counsel

for the petitioner is untenable and cannot be accepted.

10. It is not in dispute that the accused joined the

service in the complainant's Mill on 18.11.1986 and

during his tenure as an employee of the company he was

allotted a residential quarter bearing No.15/9 for his

occupation as a licensee. Ex.P1 is the agreement

executed by the accused and the property extract is

marked as Ex.P6. As per the agreement, the accused is

required to vacate his quarter within ten days from the

date of termination of his service. He was dismissed

from service on 28.02.2002 and therefore he was

required to hand over the vacant possession of the

quarter to the complainant-Company. However, he did

not vacate the said quarter, even after issuance of legal

notice to him calling upon him to vacate the said quarter

and hand over the possession of the same to the

company. He is therefore continued to be in possession

of the company quarter illegally and wrongfully withheld

the possession of the quarter.

11. Section 630 of the Companies Act, reads as

follows:

"630. Penalty for wrongful withholding of property.- (1) If any officer or employee of a company-

(a) wrongfully obtains possession of any property of a company; or

(b) having any such property in his possession, wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles and authorised by this Act;

he shall, on the complaint of the company or any creditor or contributory thereof, be punishable with fine which may extend to ten thousand rupees.

(2) The Court trying the offence may also order such officer or employee to deliver up or refund, within a time to be fixed by the Court, any such property wrongfully obtained or wrongfully withheld or knowingly misapplied, or in default, to suffer imprisonment for a term which may extend to two years."

12. The learned counsel for the respondent has

relied on a decision of the Hon'ble Apex Court in 'Gokak

Patel Volkart Ltd Vs. Dundayya Gurushiddaiah Hiremath

and others' reported in 1991 SCC (2) 141, wherein it is

held by the Apex Court that 'the beneficent provision

contained in Section 630 no doubt penal, has been

purposely enacted by the legislature with the object of

providing a summary procedure for retrieving the

property of the company: (a) where an officer or

employee of a company wrongfully obtains possession of

property of the company, or (b) where having been

placed in possession of any such property during the

course of his employment, wrongfully withholds

possession of it after the termination of his employment.

It is the duty of the Court to place a broad and liberal

construction on the provision in furtherance of the object

and purpose of the legislation which would suppress the

mischief and advance'. It is further held that 'the

offence continues until the property wrongfully obtained

or wrongfully withheld or knowingly misapplied is

delivered up or refunded to the company. For failure to

do so sub Section (2) prescribes the punishment'.

13. It is brought to the notice of the Court that

several revision petitions filed by similarly placed

accused have been dismissed by this Court, upholding

the concurrent findings recorded by the Courts below.

The copies of the orders passed in Criminal Revision

Petition Nos.100269/2016, 100270/2016, 100272/2016

and 100276/2016 are furnished by the learned counsel

for the respondent. It is held therein, as under:

"11. On perusal of the above said provisions, it is

clear that Section 630(1)(b), the Court has

discretion to direct the employee of the company to

deliver the property wrongfully withheld by him, by

fixing time and also impose the default sentence

which may extend to two years. The Trial Court, in

fact, considering the above said provision has

imposed the sentence, in accordance with law.

There is no dispute with regard to the factual

aspects, as noted above by the petitioner. The

First Appellate Court has also reconsidered the

above said factual aspects and has affirmed the

judgment of the Trial Court."