APEEJAY PRIVATE LIMITED Vs. RAGHAVACHARI NARASINHAN
LAWS(CAL)-1996-6-13
HIGH COURT OF CALCUTTA
Decided on June 19,1996

APEEJAY PRIVATE LIMITED Appellant
VERSUS
RAGHAVACHARI NARASINHAN Respondents


Referred Judgements :-

IN RE: PROPERTY COMPANY PRIVATE LTD. AND ORS. V. KHODABAD RUSTAM,BEING COMPANY APPLICATION NO [REFERRED TO]
DAMODAR DOS JAIN V. KRISHNA CHARAN CHAKRABORTY [REFERRED TO]
EMPEROR V. NAZIR AHMED [REFERRED TO]
V.M. SHAH V. STATE OF MAHARASHTRA [REFERRED TO]
M P SHARMA OTHERS VS. SATISH CHANDRA DISTRICT MAGISTRATE DELHI [REFERRED TO]
M S SHERIFF VS. STATE OF MADRAS [REFERRED TO]
ANIL BEHARI GHOSH VS. LMFLCH BALA DASSI [REFERRED TO]
PRITAM SINGH VS. STATE OF PUNJAB [REFERRED TO]
DELHI CLOTH AND GENERAL MILLS COMPANY LIMITED VS. KUSHAL BHAN [REFERRED TO]
STATE OF BOMBAY VS. KATHI KALU OGHAD [REFERRED TO]
MANIPUR ADMINISTRATION MANIPUR VS. THOKCHOM BIRA SINGH [REFERRED TO]
TATA OIL MILLS COMPANY LIMITED VS. WORKMEN [REFERRED TO]
TUKARAM G GAOKAR VS. R N SHUKLA [REFERRED TO]
MOHAN RAI BHARATH RAI VS. STATE OF BIHAR IN BOTH APPEALS [REFERRED TO]
JANG BAHADUR SINGH VS. BAIJ NATH TIWARI [REFERRED TO]
PIARA SINGH VS. STATE OF PUNJAB [REFERRED TO]
KARAM CHAND GANGA PRASAD VS. UNION OF INDIA [REFERRED TO]
MASUD KHAN VS. STATE OF UTTAR PRADESH [REFERRED TO]
RAVINDER SINGH VS. STATE OF HARYANA [REFERRED TO]
DUSHYANT SOMAL CAPT DUSHYANT SOMAL VS. SUSHMA SOMAL:SUSHMA SOMAL [REFERRED TO]
KUSHESHWAR DUBEY VS. BHARAT COKING COAL LIMITED [REFERRED TO]
STATE OF RAJASTHAN VS. KALYAN SUNDARAM CEMENT INDUSTRIES LIMITED [REFERRED TO]
CENTRAL CALCUTTA BANK LTD VS. STATE [REFERRED TO]



Cited Judgements :-

SABURA TEXTILES VS. V S KRISHNAMOORTHY [LAWS(MAD)-2001-1-6] [REFERRED]


JUDGEMENT

G.R.Bhattacharjee, J. - (1.)- This appeal is directed against the order and judgment dated the 12th July, 1989 passed by U.C.Banerjee,J. in suit No. 747 of 1988, by which the learned Judge stayed the said suit and all proceedings thereunder till the final disposal of the complaint case No. 1233 of 1988 and 1488 of 1988 including the Park Street Police Station case No. 455 dated, the 27th July, 1988. The plaintiff company (the appellant herein) filed the said suit on the allegation that the defendants Nos. 1 and 2 (that is, the respondents Nos. 1 and 2 herein) jointly carried on business as share and stock brokers and that, during the period April, 1984 to April 1985 the plaintiff paid a sum of Rs.1,98,00,000 to the defendant Nos. 1 and 2 for the purpose of acquiring shares in various companies and with specific instructions to do so including 3,51,300 shares of the defendant No. 3 (Mahindra and Mahindra Ltd.) of the value of Rs.1,39,34,513 to be purchased in the name of plaintiff or its nominee. It was also the allegation of the plaintiff that the defendants Nos. 1 and 2 purchased the said 3,51,300 shares in the Mahindra and Mahindra Ltd. for and on behalf of the plaintiff with the money provided or the defendants Nos. 1 & 2 by the plaintiff for the said purpose, but the said defendants however delivered only 1,75,000 shares in Mahindra and Mahindra Ltd. to the plaintiff and refused and neglected to deliver the balance 1,76,300 shares. In the suit the plaintiff therefore prayed for specific delivery of the said 1,76,300 shares in Mahindra and Mahindra Ltd. by the defendants Nos. 1 & 2 along with appropriate documents as might be required for the registration of the said shares in the name of the plaintiff, with certain incidental reliefs. The plaintiff also alternatively prayed for a decree of Rs.1.06,00,000 as the value of the said shares along with interest thereon. The plaintiff also filed a separate application in the said suit for appointment of receiver. The defendants Nos. 1 & 2 then filed in the said suit an application for staying the suit and all proceedings thereunder on the ground that the plaintiff earlier filed through its employee two petitions of complaint under section 156(3) Cr PC covering the self-same matter on the basis of which the police started the Park Street P.S. Case No. 455 dated the 27th July, 1988 under section 409/34, Indian Penal Code.
(2.)In the first petition of complaint filed an behalf of the appellant company, M/s. Apeejay (P) Ltd. it is stated that the company through its associate companies entrusted to the accused persons (who are the defendants/respondents Nos. 1 and 2) a sum of Rs.1,98,00,000 with instruction to purchase various shares on behalf of the appellant company and that, the company was made to understand by the accused persons that they had purchased different shares for the appellant company, as per direction valued at Rs.1,97.48.354 and further that, out of the shares in different companies purchased by the accused persons, certain shares were sold by the accused person as per the instruction of the appellant company and they deposited in favour of the appellant company only certain amount out of the said sale-proceeds leaving a balance of Rs.63,93,605 but inspite of repeated assurance the accused persons did not make over the said sale proceeds to the appellant company and thus committed the offence punishable under section 409/34 of the Indian Penal Code. In the said petition of complaint although the purchase of equity shares in EID Parry Limited and Mahindra and Mahindra Ltd. was mentioned, yet it was stated therein that separate criminal proceedings in respect of the same would be started against the accused persons, in due course. The second petition of complaint filed on behalf of the appellant company under section 409/34 IPC was in respect of the shares of the said two companies, namely, EID Parry Ltd. and Mahindra and Mahindra Ltd. in the second petition of complaint the allegation inter alia is that the accused person were instructed as share brokers to purchase 86,400 shares of EID Parry Ltd. and 3,51,300 shares of Mahindra and Mahindra Ltd. and to deliver the said purchased shares to the appellant company and that, accordingly they purchased the shares but despite several reminders the accused persons only delivered to the appellant company 78,038 shares of EID Parry Ltd. and 1,75,000 equity shares of Mahindra and Mahindra Ltd. leaving a balance of 8.362 equity shares of EID Parry valued at Rs. 1,21,249 and 1,76,000 equity shares of Mahindra and Mahindra Ltd. valued at Rs. 69,94,013 which shares have not been delivered by the accused persons despite assurance given by them and that by not returning the purchased shares in respect of the aforesaid two companies for which the accused had received full payment from the appellant company the accused persons committed criminal breach of trust in respect of Rs.71,15,262 being the aggregate value of the shares of the aforesaid two companies which have not been received by the appellant company. It is also alleged therein that the accused persons criminally misappropriated the said amount knowing fully well that they were under legal obligation to make over the purchased shares or the value thereof to the appellant company which is the property of the appellant company. That petition of complaint was also referred to the police under section 156(3) Cr PC and the police accordingly started the Park Street P.S., Police case in respect of the complaint as mentioned earlier. It was the contention of the defendants/respondent Nos. 1 and 2 before the trial court that since police investigation was pending in respect of Complaints lodged under section 409/34 IPC in respect of the self-same matter, the civil suit should be stayed till disposal of the criminal proceeding. The learned Judge, by his impugned order, granted the prayer of the defendant / respondents and stayed the civil suit till disposal of the criminal proceedings. Being aggrieved by the stay order, the appellant/ plaintiff has preferred the present appeal.
(3.)It may be noted here that although the complaints under section 156(3) Cr PC in respect of the offence punishable under section 409/34 IPC covered allegations concerning shares of various companies mentioned therein including Mahindra and Mahindra Ltd. yet the suit has been filed, as we have seen, only in respect of the undelivered shares of Mahindra ad Mahindra Ltd. it is also to be noted that in the suit the plaintiff prayed for specific delivery of the undelivered shares in Mahindra and Mahindra Ltd. by the defendants Nos. 1 and 2 or for the value thereof quantified at Rs.1,06,00,000. It is also to be mentioned that in the suit the plaintiff claimed on the plea that there was an obligation an the concerned defendants to deliver the concerned shares to the plaintiff, but the case in the criminal proceedings is based on the further allegation that the accused persons have committed criminal breach of trust and mis-appropriation in respect of the concerned shares. It is also to be noted here that while in the criminal proceedings the accused cannot be found guilty of the offence under section 409 IPC unless the ingredients of the offence of the criminals breach of trust or criminal misappropriation are established against them, the relief claimed in-the civil suit for delivery of the shares or for recovery of the value thereof is based on the mere obligation to deliver the shares irrespective of the question whether any criminal breach of trust or criminal misappropriation has been committed in respect of the same. In other words, while in the civil suit the success of the claim of the plaintiff company will depend upon the question whether it has been able to establish that the defendants have an obligation to deliver the concerned share, and if so, whether they have failed to discharged that obligation, in the criminal proceedings that will not suffice for finding the accused guilty and it will have to be established yet beyond reasonable doubt that there was entrustment and criminal breach of trust/ misappropriation in terms of the definitions contained in the appropriate sections of the Indian Penal Code. This aspect of the matter is highlighted only to indicate that even if the plaintiff obtains a decree in the civil still against the accused defendants, that by itself will not establish a charge under section 409 IPC against them for which the ingredients are different and which will have to be established beyond reasonable doubt before the criminal court by leading appropriate evidence for finding the accused guilty under section 409 IPC. notwithstanding a money decree or a decree for specific delivery of shares from the civil court against the accused defendants.
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