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1995 (8) TMI 234 - SC - Companies LawWhether the conviction under section 630 of the Companies Act (is) sustainable ? Held that - Appeal allowed. It cannot be held that the appellant has been in wrongful possession of the property entailing his conviction and punishment under section 630 and requiring handing over of the possession of the flat.
Issues:
1. Conviction under section 630 of the Companies Act 2. Relationship between the appellant and the company 3. Findings of the civil court superseding those of the criminal court Analysis: Issue 1: Conviction under section 630 of the Companies Act The appellant, who was a former employee of Rallis India Ltd., was convicted under section 630 of the Companies Act for continued occupation of a residential flat owned by the company. The Magistrate found the appellant guilty, and this decision was partly upheld by the Session Judge. However, the Supreme Court analyzed the evidence and found that the company failed to prove that they were the tenant of the premises or that the appellant was a licensee. The appellant successfully argued that the findings of the civil court, which dismissed the suit for eviction, contradicted the criminal court's decision. Citing previous judgments, the Supreme Court emphasized that the existence of an employer-employee relationship is crucial for invoking section 630, and in this case, the appellant's independent tenancy rights were established, leading to the appeal being allowed. Issue 2: Relationship between the appellant and the company The primary dispute revolved around the nature of the relationship between the appellant and the company regarding the occupation of the flat. While the company claimed tenancy rights and the appellant's obligation to deliver possession post-resignation, the appellant contended that he was a tenant under a different landlord and not in possession as an employee of the company. The civil court's findings favored the appellant's version, highlighting the lack of a jural relationship with the company and affirming his independent tenancy status. Issue 3: Findings of the civil court superseding those of the criminal court The Supreme Court emphasized the importance of the civil court's findings, which negated the company's claims and established the appellant's independent tenancy rights. The Court held that the civil court's decision superseded the criminal court's findings, especially in cases like section 630 offenses. The Court clarified that the mere pendency of an appeal does not suspend the operation of the civil court's decree, giving precedence to its findings over those of the criminal court. Consequently, the appellant's conviction and the order to deliver possession were deemed unsustainable, leading to the allowance of the appeal without costs.
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