Summary
A company sought interim recovery of a flat withheld by a former director while his specific-performance suit against the vendors remained pending. The Court held that section 630 protected the company’s lawful possessory interest even without completed ownership, permitted interim delivery before conviction and was not defeated by the civil status-quo order in these circumstances. Final criminal and civil adjudications remained open.
Issues
- Whether pending civil proceedings prevented interim delivery under section 630(2).
- Whether company ownership or allotment as a service perquisite was necessary.
- Whether the High Court properly interfered under section 482 CrPC.
Provisions considered
- Section 630, Companies Act, 1956The summary recovery provision extended to former officers, lawful company possessory interests and interlocutory delivery during trial. (¶¶ 3, 8, 9, 10, 11)
- Section 41(b) and (d), Specific Relief Act, 1963The specified prohibitions supported the conclusion that the civil interim injunction did not bar the criminal proceeding. (¶ 8)
Held
- A civil suit does not bar section 630 proceedings where there is no bona fide dispute about the company’s right to possession. The company was not a party to the suit against the vendors, and its separate personality could not be disregarded without pleaded and proved grounds. The temporary status-quo order did not defeat recovery on these facts. (¶ 8)
- Section 630(2) permits interim delivery before disposal of the substantive prosecution when the company’s possessory right is prima facie established. Its reference to the court trying the offence does not require prior conviction. (¶ 9)
- Completed ownership is unnecessary: property of the company includes its lawful exclusive possessory interest under a lease or licence. Possession need not have been provided as a residential service perquisite, but must be held in the officer or employee capacity and withheld without an independent right after employment ends. (¶ 10)
- The order was interlocutory and did not finally establish wrongful withholding. It would stand vacated if the company failed at trial; a later civil decree in the former director’s favour must be honoured. No exceptional illegality or jurisdictional defect justified inherent-power interference here. (¶ 11)
Result
The company’s appeal was allowed and the High Court judgment set aside, restoring the interlocutory recovery relief. The substantive trial was to be completed expeditiously, and any eventual civil decree in the former director’s favour was to be honoured.