Case Brief: Hindustan Construction Co. Ltd. & Anr. Vs. Gopal Krishna Sengupta and Ors.

Deciding Authority: Supreme Court of India
Date of Judgment: 9th April, 2003
Bench: Justice S. N. Variava H. K. Sema.
Facts of the Case: The 1st Respondent was an employee of the Appellant Company. His services were terminated. The 1st Respondents’ challenge to his ermination has been dismissed both by the Industrial Tribunal and the High Court. The Appellant purchased shares. The Appellants claim that as per their internal procedure one employee wrote down the name of the 1st Respondent and his son on the share certificate for purposes of putting them up before the Board of Directors. The Appellants claim that they thereafter realized that the transfer form was not sufficiently stamped, so the endorsement on the share certificate was cancelled without effecting a transfer of the share certificate. The transfer form and the share certificate were again returned to the 1st Respondent.
While the above-mentioned case was pending in the Company Law Board, in August 1991, the Appellants transferred this share certificate into the name of one Pritika Prabudesai. The Appellants claim that they received the share certificate along with a duly signed transfer deed. The Appellants claim that they addressed a letter to Mr. Ambalal Shah calling upon him to disclose whether he had any objection to such transfer. They claim that they transferred the share into the name of Pritika Prabhudesai as they did not receive any objection from Mr. Ambalal Shah. Admittedly the Appellants knew, by August 1991, that 1st Respondent had claimed that the shares were not returned to him. The Appellants knew that 1st Respondent had lodged a Petition under Section 111 of the Companies Act for transfer of the share to his name. The Appellants knew that this Petition was pending. They well knew that there was a dispute in regard to this share certificate. Yet they did not address any letter or intimation to the 1st Respondent informing him that some other person had lodged this share for transfer to their name.
Judgment of the Case: The question still remains whether, on facts of this case, the direction given in the Order dated 19th October, 2000 can be maintained. In the application there was no prayer to examine Pritika Prabhudesai. The prayer was to quash the proceedings and start trail afresh. There is no provision in law which permits this. Thus the application could not be allowed. Undoubtedly the High Court has proceeded on the footing that this evidence is essential and necessary. Section 311 of the Criminal Procedure Code permits taking of evidence at any stage. The High Court undoubtedly felt that it was in the interest of all parties that necessary evidence be recorded at this stage itself. But the fact remains that the application for this very relief has been rejected on 6th November, 1997. No appeal or revision was filed against that Order. The Order dated 6th November, 1997 has therefore become final. Once such a relief has been refused and the refusal has attained finality, judicial propriety requires that it not be allowed to be reopened. The High Court was obviously not informedof the Orderdated 6th November, 1997. Thus the High Court cannot be blamed. However as that Order has been brought to notice of this Court we cannot ignore it. Another factor which we keep in mind are the Order dated 15th September, 2000 in Writ Petition No. 599 of 1998 and Order dated 23rd November, 1998 in Writ Petition No. 1507 of 1998. By these Orders it has been clarified by the High Court that the case has reached conclusion and liberty has been granted to 1st Respondent to raise all the points in a proceeding the 1st Respondent may have to adopt if the Criminal case is dismissed against him. The Appellants are within their right to oppose the directions issued in the Order dated 19th October, 2000. However in the long run this may prove disadvantageous to the Appellants. It is possible that if the case is decided against the 1st Respondent and the higher Court feels that application to lead necessary evidence has been wrongly rejected, the whole case may have to be sent back for leading this evidence. We therefore asked the Appellants whether they wanted to still oppose the directions issued. We were told that they did. We therefore allow the Appeal against the Order dated 19th October, 2000 and set aside the directions issued therein. The application filed by 1st Respondent willstand rejected.