Companies Act, 1956
Section 630—Nature of proceedings—A perusal of the provisions under Section 630 of the Companies Act would show that the same is a summary procedure—Concerned criminal court cannot determine the dispute as to the title of property under dispute—Such questions are to be decided by the competent civil court.
Held : The Section 630 of the Companies Act can be invoked when there is no dispute or in any event, no bona fide dispute with respect to the property in question exists. If there is any dispute involving title to the property, the same would be adjudicated by the concerned civil court and not by Magistrate under Section 630 of the Companies Act.
[Para 14 & 15]
Section 630—Invocation of provisions—Effect of pendency of civil dispute—Mere pendency of a civil dispute with respect to the property in question would not be a bar to take recourse to Section 630 of the Companies Act if there is no bona fide dispute regarding the right of the company over the property in question.
Section 630—Prosecution—Petition to quash summoning order and complaint case itself—Serious disputes pending between parties with respect to subject property—Said dispute goes to the very entitlement of complainant as to whether the same would fall within its share or as to whether petitioner would be entitled for title and ownership of property in dispute—MoU clearly stipulates which company would go to which group—MoU has a binding effect—Complaint in question came to be filed almost after 22 years from the execution of the MoU—Before the filing of the complaint, even according to the complainant itself, there are various cases filed by them, particularly with respect to the property in dispute—Present dispute relates to a property, in respect of which, there are bonafide disputes between the parties—No application of mind as to what would be the effect of the MoU and pendency of the civil suit between parties—Proceedings under Section 630 of the Act are summary in nature and the same cannot be resorted to, to bypass the other civil remedies—Criminal process, at a pre-trial stage, normally should not be scuttled—Normally based on a prima-facie impression, an element of criminality cannot entirely be ruled out—However, if under the facts of a given case, the High Court finds that the criminal proceedings are absolutely an abuse of the process of law, the High Court must exercise its power under Section 482 of CrPC—As it can be seen from the facts that the fate of the property in dispute is not yet determined, the rival parties are claiming rights over the property in dispute on the basis of the MoU—Till date, neither the petitioner nor the respondent/complainant has the clear title or ownership over the subject property—There is no sale deed in their favour—Suit for specific performance of contract filed by them against original vendee is still pending—Order of summoning of petitioner is illegal and same deserves to be quashed—Petition allowed. [Criminal Procedure Code, 1973, Section 482]
[Paras 24 to 26]
Decision : Petition allowed