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Foseco India Ltd. v/s Navneet Kumar Dwivedi

Company & Directors' Information:- FOSECO INDIA LIMITED [Active] CIN = L24294PN1958PLC011052

Company & Directors' Information:- THE INDIA COMPANY PRIVATE LIMITED [Active] CIN = U74999TN1919PTC000911

Company & Directors' Information:- INDIA CORPORATION PRIVATE LIMITED [Active] CIN = U65990MH1941PTC003461

Company & Directors' Information:- NAVNEET (INDIA) PVT LTD [Strike Off] CIN = U17219WB1976PTC030456

    Cri. Appeal 239 Of 1996

    Decided On, 24 August 2000

    At, High Court of Orissa


    For the Appearing Parties: S.K. Padhi, Advocate.

Judgment Text

(1.) The appellant has challenged the judgment of acquittal dated 25-6-1994 passed by Shri A. C. Mohanty, Additional Sessions Judge, Rourkela in Criminal Appeal No. 12 of 1993 reversing the judgment dated 28-1-1993 passed by Shri R. K. Panda, J.M.F.C., Panposh in ICC No. 8 of 1992 in which respondent Navneet Kumar Dwivedi had been convicted under Section 630 of the Companies Act, 1956 (hereinafter referred to as 'the Act') and sentenced to pay a fine of Rs. 1,000.00 (One Thousand), in default to undergo S. I. for one month and further directing the respondent under sub-section (2) of Section 630 of the Act to vacate the house in question within two months from the date of the judgment, failing which he was directed to undergo S. I. for two months.

(2.) The appellant's case is as follows: Appellant FOSECO India Limited is a registered company under the Act with headquarters at Bombay, having a branch at Rourkela. Respondent was the Branch Manager of the Rourkela Branch and in that capacity was in occupation of a rented house bearing No. E/1 at Koel Nagar, Rourkela which was taken on lease by the company from the owner one S. K. Jain. There was an agreement (Ext. 2) between the owner of the house and the appellant-company executed on 30-4-1988 for a period of three years from 1-11-1987 to 31-10-1990 with the stipulation that the tenant would pay rent at the rate of Rs. 2,000.00 per month. According to the appellant, even though there was no fresh agreement between the parties after termination of the lease on 31-10-1990, the respondent continued to be in possession of the house taken on lease. The respondent's service was terminated on 14-8-1991, but he did not vacate the house in question even in spite of two notices served on him. Hence, according to the appellant, the respondent was in unauthorised occupation of the company's property. Hence criminal proceeding under Section 630 of the Act was initiated by the appellant and the trial Court found the respondent guilty and convicted him sentencing him to pay a fine as stated above. Being aggrieved by the said judgment of conviction, the appellant preferred Criminal Appeal before the Additional Sessions Judge, Rourkela who set aside the judgment of conviction and sentence passed by the learned Magistrate and acquitted the respondent of the charge besides setting aside the direction to the respondent for vacating the house.

(3.) Shri S. K. Padhi, learned counsel for the appellant, and the respondent who appeared in person, were heard at length. Shri Padhi contended that the impugned judgment is illegal and is liable to be set aside, inasmuch as the learned Additional Sessions Judge fell into error in holding that the tenancy had expired and the house in question was not a property of the appellant. The respondent supported the impugned judgment.

(4.) For better appreciation, Section 630 of the Act is quoted below :-

"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 withholding 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 one thousand rupees.

(2) The Court trying the offence may also order such officer or employee to deliver up or refund, within time to be fixed by the Court by 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. "

(5.) The learned Addl. Sessions Judge has come to the conclusion that since there was no renewal of the lease after expiry of the period of three years on 31-10-1990 and since the appellant failed to produce any receipt showing payment of rent to the landlord after expiry of the lease, the lease did not subsist after that period. There is no reason to differ from the said finding of the appellate Court for the reasons stated below.

(6.) Ext. 2 is the agreement dated 30-4-1988 in which it was stipulated, amongst others, that the lease was for a period of three years from 1st November, 1987 and to pay the rent before 10th day of each calendar month. There was no stipulation that the lease would be renewed after expiry of the period of three years. Ext. 7 is a letter dated 7-11-1991 purported to have been written by Shri S. K. Jain, owner of the house, requesting the appellant for vacation of the house and for payment of enhanced rent at the rate of Rs. 3,000.00 per month with effect from 1-11-1990. Said S. K. Jain has not been examined in support of the appellant's case. There is no evidence on record as to whether the appellant or the respondent was paying rent to the landlord. After termination of the lease, the appellant could have either renewed the lease or intimated the landlord to realise rent from the occupant of the house and disown its liability to pay rent and the landlord would have taken legal action for realisation of rent and vacation of the house in question. That apart, by no stretch of imagination it can be held that the house taken on

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lease by a company would be the property of a company so as to invoke the provisions of Section 630 of the Act. Therefore, the contention of the learned counsel for the appellant is unsustainable. Learned Additional Sessions Judge has rightly set aside the conviction and sentence passed under Section 630 of the Act which cannot be interfered with. Thus the appeal is found to be devoid of any merit and is liable to be dismissed. (7.) In the result the Criminal Appeal is dismissed and the impugned judgment dated 25-6-1994 of the learned Addl. Sessions Judge is upheld. Appeal dismissed.