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TMI Blog2002 (4) TMI 835X X X X Extracts X X X X X X X X Extracts X X X X ..... with built-in-software Sl. No. A03135 (4)Hindustan Contessa car bearing Regn. No. PY 01B 7155 with tools and Registration Certificate (5)Diesel Generator of 62.5 KVA Kirloskar make with Alternator and Standard Panel Board, Fuel Tank with accessories. There is no dispute that these five items of properties described in the schedule to the plaint belong to the company called "Coimbatore Pioneer Mills Ltd." which is a public limited company. It is also not in dispute that the revision petitioner was one of the two managing directors of that company and he ceased to be the managing director with effect from 1-10-1994. The complainant company is represented by the Chairman-cum-Managing Director of the said Coimbatore Pioneer Mills Ltd. The defence to the claim was that the accused neither wrongfully obtained possession of the property of the complainant company nor is he wrongfully withholding any property of the company. In sustaining this defence, the accused projected primarily two documents namely, Exs. D.1 and D.2. The Chairman-cum-Managing Director of the complainant company examined himself as P.W. 1, besides marking Exs. P.1 to P.10 on his side. The accused examined hims ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the arguments advanced by the learned senior counsel on either side and in the context of Exs. P. 9, D.1 and D. 2, I applied my mind to the controversy at issue. There are two limbs of section 630. Under the first limb, if a person wrongfully obtains possession of any property of a company, then he, on the happening of the event mentioned therein, is liable to punishment. Under the second limb, if a person having the property of a company in his possession wrongfully withholds it, then he is also liable to be punished. On the admitted nature of the properties forming the subject-matter of the complaint namely, they belong to Coimbatore Pioneer Mills Ltd., the question that comes up for considera-tion is whether the possession of those properties by the accused would amount to the wrongfully holding it? To appreciate this controversy, in my opinion, a reference to Exs. D. 1, D. 2 and P. 9 alone would be more than sufficient, besides looking into the oral evidence. It is no doubt true that to Ex. D.1 neither Coimbatore Pioneer Mills Ltd. by name nor Chandra Mills Ltd. by name is a party. But, however, the document is signed by G. Devarajan, who happens to be the Chairman-cum-Managing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion on Point No. 6 in Ex. D.2 is made by me." Under such circumstances, what would be the binding nature of this agreement on the respective companies would not be within the jurisdiction of the criminal court for its decision. In other words, in my consi- dered opinion, the Magistrate exercising powers under the Code of Criminal Procedure would have no jurisdiction at all to decide the issue namely, one (the accused) asserting that this agreement had been implemented and the other (complainant) asserting contra that this is not a binding agreement. In my opinion such nature of dispute would come within the jurisdiction of the civil court only, which can effectively go into this issue and arrive at a conclusion one way or the other or construing the document; other documents, if any, placed and the oral evidence, if any, placed. Therefore, prima facie I am of the firm opinion that the Magistrate has no jurisdiction at all to go behind the terms of this agreement marked as Ex. D.1, especially when there is no dispute about the parties to the agreement and the signatories to the same. It is no anybody s case that Ex. D.1 is a fabricated document. It is also not in dispute that pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed had taken the properties mentioned therein only to one of the two places mentioned therein. In other words, under clause 17, Coimbatore Pioneer Mills Ltd. which owns Pioneer Power Systems and its assets, prima facie appears to have divested their interest in respect of that property, which prima facie resulted in the transfer of interest in the same in favour of the accused. 6. There are two bungalows, one called a Pioneer House and the other called Chandra Bungalow . Pioneer House originally belonged to Coimbatore Pioneer Mills Ltd. and Chandra Bungalow belonged to Chandra Textiles Ltd. But however, in Chandra Bungalow Mrs. Suguna, wife of the Chairman-cum-Managing Director of Coimbatore Pioneer Mills Ltd. was living while in Pioneer House Mrs. R. Nandini, wife of the accused herein was living. Till the final exchange takes place in accordance with law, Pioneer House would be the tenanted residence of Mrs. Nandini, wife of the accused and Chandra Bungalow would be the tenanted premises of Mrs. Suguna, wife of Shri G. Devarajan. The sum and substance of the agreement between the parties as reflected in the memorandum of understanding is that, the accused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ealthily removed the said generator from the control of Coimbatore Pioneer Mills Ltd. and installed the same in the Pioneer House . It is true that the purchase invoice for this generator stands in the name of Coimbatore Pioneer Mills Limited. It is not in dispute that the generator was installed in Pioneer House even on 14-7-1994. Therefore it is clear that the installation of generator in Pioneer House preceded the tenancy agreement dated 3-10-1994, i.e., Ex. P.9. If really the generator does not form part and parcel of the tenancy, then nothing prevented the respective companies, when they entered into an agreement of tenancy dated 3-10-1994, to exclude the generator from the terms of the tenancy given to Mrs. Nandini, wife of the accused. In my opinion, the failure to exclude the generator from part and parcel of the tenancy in respect of Pioneer House would make it very clear that the intention of the parties was that the generator should continue to form part and parcel of the tenancy. 8. As far as the car mentioned as Item No. 4 at the foot of the complaint is concerned, there is some reference to it in Ex. D.2. But as contended by Mr. V. Gopinath, the learned s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment by stating that this car was never the property of Pioneer Power Systems but it always belonged to Coimbatore Pioneer Mills Ltd. The learned senior counsel also submitted that the accused in his capacity as the Managing Director of the said company alone was allowed to use the car. Whether the Contessa Car is the property of Pioneer Mills or Pioneer Power Systems covered under clause 17 of Ex. D.1 and whether the decision of Point No. 6 as reflected in Ex.D.2, though there appears to be no binding decision, involves larger complicated questions of law and fact arising on the construction of Ex.D.1/Memorandum of Understanding, especially when at least a part of the same had been performed. Resignation of the accused as the Managing Director of Coimbatore Pioneer Mills Ltd. was not due to any other cause but it was the end product of the Memorandum of Understanding arrived at between G. Devarajan and G. Rangaswamy and marked as Ex.D.1. It is possible to visualise that if the Memorandum of Understanding was not there, whether the accused would have resigned his post as the Managing Director of the company on his own and, to remove a person from the office of the Managing Director ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icence in favour of the company has expired, could it be said that the company was a licensee of the said flat? The court took the view that both these questions were complicated questions of civil law and that hence the Magistrate s court has no jurisdiction to decide the same and the High Court felt that the disputes raised by the employee were bona fide disputes." On the above noted facts, the Apex Court held that the question of implied licence in favour of the company is a question which requires to be determined by a civil court and cannot be determined by a Magistrate s court in a proceeding under section 630. The above referred to case was quoted with approval by the Apex Court in the latter judgment Atul Mathur v. Atul Kalra [1990] 68 Comp. Cas. p. 324. The facts in that case are as follows : "The company secured a flat in Bombay on leave and licence basis; the agreement was entered into on behalf of the company by the employee of the company; the employee was allowed to occupy it as an employee of the company; the employee filed a suit for declaration that he is the licensee of the flat and for consequential injunction not to interfere with his possession of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oyee , yet in view of the nature of dispute and thick relationship between the parties to the proceedings, I am of the firm opinion that such strict construction of employer - employee relationship need not be imported into this case. If the accused is simplicitor an employee, then different consideration would arise. The Chairman-cum-Managing Director of the complainant company and the accused are signatories to Ex.D.1. I have already found that the Chairman-cum-Managing Director of the complainant company by holding substantial shares in that company is actually controlling the said company. Therefore, what would be the legal consequence of the Chairman-cum-Managing Director entering into an agreement with the accused (Ex.D.1) without making his company itself a party to the said agreement, is a matter which cannot be decided light heartedly and in a summary manner. This is all the more so, when the parties to the said agreement have performed some of the reciprocal obligations imposed on them under the said agreement. Therefore, there cannot be any doubt at all that here exists a bona fide dispute of a civil nature based on Exs.D.1 and D.2. It is true that the arbitrator under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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