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of <h1>Petitioner's Summoning under Companies Act Section 630 Quashed as Abuse of Legal Process</h1> <h3>Dr. D.K. Modi S/O Late Shri K.N. Modi Versus Modi Rubber Limited, State (Govt. Of Nct of Delhi)</h3> Dr. D.K. Modi S/O Late Shri K.N. Modi Versus Modi Rubber Limited, State (Govt. Of Nct of Delhi) - TMI Issues Involved:1. Whether the offence under Section 630 of the Companies Act is made out.2. Whether the impugned order of summoning is legally and factually valid.3. Whether the dispute is of a civil nature and being given a criminal color.4. Applicability of Section 482 of Cr.P.C. and the test laid down in State Of Haryana v. Ch. Bhajan Lal.5. Locus standi of the petitioner to challenge the proceedings.6. Whether Section 630 of the Companies Act is a special remedy and a complete code.7. The impact of the pending civil disputes on the criminal proceedings.8. Whether the complaint under Section 630 of the Companies Act is barred by limitation.Detailed Analysis:1. Offence under Section 630 of the Companies Act:The petitioner argued that the complainant is not the owner of the property and the ingredients of Section 630 are not satisfied. The court noted that Section 630 can be invoked when there is no bona fide dispute regarding the property. If there is a dispute involving the title, it should be adjudicated by a civil court and not under Section 630.2. Validity of the Summoning Order:The petitioner contended that the summoning order was passed without a legal or factual basis. The court found that the learned Magistrate did not apply judicial mind to the facts, particularly the pending civil disputes. The order merely reiterated the complainant's statements without considering the implications of the MoU and ongoing civil litigations.3. Nature of the Dispute:The petitioner argued that the dispute is essentially civil and is being given a criminal color. The court agreed, noting that the property dispute involves complex civil issues, including the interpretation of the MoU and the pending civil suits. The criminal proceedings under Section 630 were found to be an abuse of the process of law.4. Applicability of Section 482 of Cr.P.C.:The court cited the Supreme Court's decision in Pepsi Foods Ltd., emphasizing that summoning an accused in a criminal case is a serious matter. The High Court should exercise its power under Section 482 of Cr.P.C. to quash proceedings if invoking criminal jurisdiction is an abuse of the process of law.5. Locus Standi of the Petitioner:The respondent argued that the petitioner has no locus to challenge the proceedings as the complainant is the superior lessor. The court did not find this argument sufficient to deny the petitioner's right to challenge the summoning order, especially given the complex civil disputes involved.6. Section 630 as a Special Remedy:The respondent claimed that Section 630 is a special remedy and a complete code. The court acknowledged this but emphasized that it cannot be used to bypass civil remedies, particularly when there are bona fide disputes about the property.7. Impact of Pending Civil Disputes:The court noted multiple pending civil suits involving the property, including suits for specific performance and injunctions. The existence of these disputes indicated that the issue is not straightforward and should be resolved through civil litigation rather than criminal proceedings.8. Limitation:The respondent argued that the offence under Section 630 is a continuing offence and not barred by limitation. The court did not address this issue in detail, focusing instead on the broader context of the civil disputes and the misuse of criminal proceedings.Conclusion:The court found that the learned Magistrate erred in summoning the petitioner under Section 630 of the Companies Act. Given the complex civil disputes and the lack of clear title or ownership over the property, the criminal proceedings were deemed an abuse of the process of law. Consequently, the complaint case, the summoning order dated 19.10.2012, and all proceedings emanating therefrom were quashed. The petition was allowed and disposed of accordingly.
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