Legal heirs of a deceased employee can be prosecuted under Section 630 of the Companies Act for wrongfully withholding company property, affirming the section's applicability.

1. One more dimension concerning the ambit and scope of S. 630 of the Companies Act, 1956 has been canvassed in this case. The issue is briefly summarized in the question as to whether the criminal action contemplated u / S. 630 of the Companies Act for retrieval of company property or premises wrongfully withheld is maintainable against the legal heirs of a deceased employee. More exactly, the two possible situations that are illustrated are, firstly, where the employee has died in service and the legal heirs wrongfully withheld possession of the premises, and secondly, where the employee himself, who has wrongfully withheld the premises, dies during the pendency of the S: 630 proceedings and the legal heirs continue to wrongfully withheld the premises. Having regard to the fact that S. 630 of the Companies Act refers to action only against officers / employees of a Company which as now clarified by the Supreme Court necessarily includes ex - employee, whether legal heirs who wrongfully withhold Company property can claim that they are outside the ambit and scope of S. 630 of Companies Act and, therefore, immune from a criminal prosecution. The answer in both cases is an emphatic no.

2. Simultaneously, a curious contention was raised in all solemnity and seriousness and argued threadbare with the assistance of hundreds of authorities and comparisons with the provisions of scores of other Statutes in support of the plea that S.630 of the Companies Act is discriminatory vis - a - vis employees of Companies as a class and that it singles them out for penal action in cases of wrongfully withholding of properly; whereas no such steps are provided for in relation to all other classes of employees and that, consequently, S. 630 of the Companies Act is liable to be struck down as being ultra vires the provisions of Art.14 of the Constitution of India. The petition having been admitted, at which time a speaking order was passed to the effect that the point requires consideration, I have examined it threadbare only to conclude that the challenge is thoroughly devoid of substance. S.630 of the Companies Act incorporates a simple provision whereby a Criminal Court is empowered to direct the restoration of the property to the company and to impose a fine and, in appropriate cases, a jail sentence as a penalty for defaulting. The section applies to any employee of a company who commits the offence of wrongfully withholding the company property and it is well settled law that the Legislature is empowered to make separate provision for a class of such persons. The categorisation is neither arbitrary nor unreasonable and the provision does not single out one or several persons for hostile discrimination, but only prescribes a penalty for those persons who commit an offence. I see little difference between this provision of law and any other penal provision and the argument that its application to company employees as a class constitutes discrimination is illogical and untenable.

3. The Supreme Court has recently come down heavily on a class of litigation indulged in for purposes of compounding a wrongful act such as withholding of property and has specifically directed such attempts to be curbed at the threshold. To my mind, this proceeding can aptly be defined as a fake litigation on which over a hundred hours of judicial time were consumed. The trial is yet to conclude before t