"Wife Has Right to Use Marital Home, But Not Company Assets," Rules Calcutta HC

The Calcutta High Court, presided by Justice Ajay Kumar Gupta, has dismissed a criminal revisional application seeking the quashing of proceedings initiated under Section 452 of the Companies Act, 2013. The petition was filed by Meeta Bansal, who had been accused of wrongfully retaining company property following a matrimonial dispute with her husband, Sunil Bansal, the Managing Director of Lexus Exports Private Limited. The court ruled that the trial should proceed, allowing the lower court to determine whether the petitioner had wrongfully withheld company property.

The case stemmed from a longstanding matrimonial dispute between Meeta Bansal and her husband, Sunil Bansal. Both were directors and shareholders of Lexus Exports Private Limited. The dispute escalated after Sunil Bansal allegedly deserted the petitioner in 2015, leading to a series of legal confrontations, including domestic violence complaints and police cases. Amid these disputes, Lexus Exports filed a criminal complaint under Section 452 of the Companies Act, 2013, alleging that Meeta Bansal wrongfully retained company assets, including a Honda Jazz car and electronic items, at the marital residence, despite no longer being a company director.

The primary legal issue was whether the petitioner had wrongfully withheld company property, which falls under Section 452 of the Companies Act. This section allows punishment for officers or employees who wrongfully retain company property after their employment or directorship ends. The petitioner argued that since she was no longer a director and the property was used by her husband, the managing director, the proceedings were an abuse of process, and the property was not in her "conspicuous possession."

The court disagreed, emphasizing that although the items were purchased for the use of Sunil Bansal, they were still in the marital residence where Meeta Bansal continued to live. The court noted that she was residing there as Sunil Bansal's wife and thus had a legal right to use the residence and its furnishings.

The court highlighted that while Meeta Bansal was no longer a director of the company, her residence in the marital home, where the company assets were located, was legally valid under matrimonial law. "The petitioner has every right to use the residence of Mr. Bansal together with fitting and fixtures as a wife," the court noted, stating that her use of the property was not wrongful per se.

The court distinguished between the various company assets, noting that the Honda Jazz car, registered in the company’s name, was being used by the petitioner exclusively for personal purposes. Since she was no longer a director, she was not entitled to retain the vehicle. The court ruled that this issue must be addressed at trial.

The court found no grounds for quashing the criminal proceedings under Section 452, noting that the complaint raised valid legal issues that needed to be resolved through trial. "The question of whether the petitioner wrongfully withheld company property cannot be conclusively determined at this stage without a full-fledged trial," Justice Gupta observed. The court relied on various precedents, including the judgment in Aniruddha Khanwalkar v. Sharmila Das, where it was held that summoning the accused based on prima facie evidence is permissible, with the trial court responsible for evaluating the merits of the case.

The High Court's decision to dismiss the petition underscores the importance of allowing the trial court to fully examine allegations of wrongful withholding of company property. By affirming the lower court's rejection of the discharge application, the judgment sets a precedent that matrimonial disputes should not be used to circumvent corporate legal obligations. The case will now proceed to trial, where the court will determine the merits of the claims under Section 452 of the Companies Act, 2013.

Date of Decision: 06 September 2024]

Meeta Bansal v. The State of West Bengal & Another