2003 (4) TMI 575 - SC - Indian Laws

Summary

Issues Involved:
1. Termination of employment and subsequent legal challenges.
2. Dispute over share transfer and rectification of share register.
3. Criminal complaints and proceedings involving allegations of fraud and malfeasance.
4. Procedural irregularities and judicial propriety in criminal proceedings.
5. High Court's directions and their implications.

Detailed Analysis:

1. Termination of Employment and Subsequent Legal Challenges:
The 1st Respondent, an employee of the Appellant Company, had his services terminated. His challenge to this termination was dismissed by both the Industrial Tribunal and the High Court.

2. Dispute Over Share Transfer and Rectification of Share Register:
The 1st Respondent purchased 50 shares of the Appellant Company and faced issues with the transfer of these shares due to discrepancies in signatures and insufficient stamping. Despite multiple attempts to lodge the share transfer form and share certificate, the Appellant Company returned them citing various reasons. The 1st Respondent claimed that the share certificate and transfer form were not returned to him after one such attempt, leading him to file a petition under Section 111 of the Companies Act before the Company Law Board for rectification of the share register.

While this petition was pending, the Appellant Company transferred the shares to another individual, Pritika Prabudesai, without notifying the 1st Respondent, despite knowing about the pending petition and the dispute over the share certificate. The Company Law Board dismissed the 1st Respondent's petition, stating that the transfer forms were not properly stamped and no actual transfer had taken place.

3. Criminal Complaints and Proceedings Involving Allegations of Fraud and Malfeasance:
The 1st Respondent filed multiple criminal complaints alleging offenses under various sections of the Indian Penal Code, including Sections 405, 420, 424, 467, and others. The complaints were against several accused persons, including the Appellant Company. The complaints led to the issuance of process, framing of charges, and various applications for examining witnesses and producing evidence. The proceedings saw multiple applications by the 1st Respondent being rejected, including an application to examine Pritika Prabudesai and to quash the entire proceedings for a fresh trial.

4. Procedural Irregularities and Judicial Propriety in Criminal Proceedings:
The Metropolitan Magistrate allowed cross-examination of the 1st Respondent before framing charges and recorded the statements of the accused under Section 313 Cr.P.C. without an application for closing evidence. The High Court noted these irregularities and issued directions to allow the 1st Respondent to lead additional evidence, which was contested by the Appellant Company. The High Court's directions were based on the necessity to secure ends of justice, despite the procedural lapses.

5. High Court's Directions and Their Implications:
The High Court directed the trial court to pass an appropriate order on the 1st Respondent's application to examine Pritika Prabudesai and to allow additional evidence. The Appellant Company moved an application to recall this order, which was disposed of by the High Court, emphasizing that Section 362 of the Cr.P.C. barred the court from altering or reviewing its final order. The High Court issued a show-cause notice to the 1st Respondent for allegedly playing fraud by not disclosing prior orders.

The Supreme Court found no infirmity in the High Court's orders dated 13th/22nd December, 2000, and 22nd December, 2000, but set aside the directions issued in the order dated 19th October, 2000, as the application for examining Pritika Prabudesai had already been rejected on 6th November, 1997, and had attained finality. The Supreme Court allowed the appeal against the order dated 19th October, 2000, but clarified that the trial court could follow the procedure indicated by the High Court to compare the original documents with those produced in evidence.

Conclusion:
The appeals were disposed of with no order as to costs, and the Supreme Court noted the 1st Respondent's refusal of reasonable settlement offers, indicating his intent to act out of vengeance against the Appellant Company.