1989 Supreme(SC) 397

SUPREME COURT OF INDIA
S. Natarajan and S. Ratnavel Pandian, JJ.
Atul Mathur - Appellant
versus
Atul Katra and Anr. - Respondents
Crl. Appeal No. 549 of 1987
Decided on 8-8-1989

IMPORTANT POINT
Merely because the employee had schemingly filed a civil suit for injunction & declaration before tendering his resignation, it can never be said that the Civil Court was in seisin of a bonafide dispute between the parties and as such the Criminal Court should have stayed its hands when the company filed a complaint against him under Section 630 Companies Act.

Headnote:(i) Criminal Procedure Code, 1973 - Section 482 - Companies Act, - Section 630 - Purpose of enacting the provision - Documents on record proving that the flat was taken on leave and licence basis by the company only for providing accommodation to its employees during their term of employment - It was on that basis that the 1st respondent, Divisional Sales Manager was allowed to occupy the Oat - The 1st respondent trying to lay claim to licence rights over the fiat - He riled civil suit seeking relief of declaration and injunction, tendering his resignation - Company moo a complaint against him under Section 630 of the Act-Whether the Criminal Court had Jurisdiction to adjudicate upon the issue once the Civil Court was in session of the matter? - (Yes, merely because the 1st respondent had schemingly filed a suit before tendering his resignation, it can never be said that the Civil Court was in session of a bonafide dispute between the parties).

       Held: We have already referred to the relevant portion of the leave and licence agreement and the affidavit and letter of the first respondent wherein he has categorically accepted that the company was the licencee of the flat Secondly, the evidence projected by the 1st respondent to lay claim to licence rights over the flat is his own creation without the knowledge of the company. The two letters in question had been obtained from a junior employee who had joined the company long after the flat was taken on rent and who knew nothing of the agreement between the company and the owner of the flat. The author of the letters has himself confessed that he had signed the letters at the behest of the 1st respondent without knowing the implications of his act. Leaving aside these factors, even if we are to take that Mr. Jain had of his own accord written the letters, can it ever be said that the letters afford scope for the 1st respondent to contend that he is bonafide entitled to dispute the companys claim to possession of the flat. The sequence of events also go to show that the 1st respondent had formulated a plan for clinging to his possession of the flat even after resigning his post and in accordance with that plan he had obtained the letters Exs. 3 and 4 and then filed a suit in order to forestall the company from proceeding against him under Section 630 of the Companies Act. Merely because the 1st respondent had schemingly filed a suit before tendering his resignation, it can never be said that the Civil Court was in seisin of a bonafide dispute between the parties and as such the Criminal Court should have stayed its hands when the company filed a complaint under Sec. 630. If a view is mechanically taken that whenever a suit has been med before a complaint is laid under Section 630, the Criminal Court should not proceed with the complaint, it would not only lead to miscarriage of justice but also render ineffective the salutary provisions of Section 630. (para 15)

       (ii) Companies Act, - Section 630 - Complaint under - The Magistrates jurisdiction under Section 630 would extend only to those cases where there is no dispute or no bonafide dispute regarding a property claimed by the company between the company and its employee - As to when a dispute would amount to bonafide dispute would depend upon the facts of each case - Every dispute would not become a bonafide dispute merely because the companys claim to possession is refuted by an employee or ex-employee of the company. (Paras 17 & 18)

       (iii) Criminal Procedure Code, 1973 Section 465 – Companies Act - Section 630 Complaint under - Challenged on the ground that the complaint suffered from an irregularity - The complainant, the Divisional Sates Manager of the Company was duly authorised to file the complaint on behalf of the company - The complaint is validly passed.

       Held: The power of attorney has been executed just before the complaint was filed and it is stated in the complaint that Mr. Atul Mathur was filing the complaint on behalf of the company and he was duly authorise to do so. The High Court was therefore, not right in construing the power of attorney as conferring only special powers and not general powers on Mr. Atul Mathur. Be that as it may, the High Court has held, and very rightly that as Mr. Atul Mathur was the Divisional Sales Manager of the company at Bombay he was certainly competent to file the complaint on behalf of the company as per instructions given to him from the Head Office of the Company. We do not therefore find, any substance in the contention of the 1st respondent that the complaint Sic. suffered from a material irregularity not curable under Section 465 Cr. P.C. Incidentally, we may observe that in spite of contending that the Sic. Complaint suffered from an irregularity, the 1st respondent has neither pleaded nor proved that a failure of justice has been occasioned on account of the alleged irregularity. (para 20)