The main legal point established in the judgment is that the accused company's failure to comply with the provisions of the Companies Act, 1956 regarding the deposit and disbursement of declared dividends constituted an offence under the Act, and the penal provision should not be exonerated once the amount has been paid.

JUDGMENT

K. Natarajan, J. - Crl. P. No. 5646/2016 is filed by accused No. 2 and Crl. P. No. 3454/2017 is filed by accused Nos. 1 and 3 to 7 under Section 482 of Cr.P.C. for quashing the criminal proceedings in C.C. No. 116/2016 pending on the file of Special Judge, Economic Offences Court, Bengaluru.

2. Heard the arguments of learned counsel for the petitioners and learned Special counsel for the respondent.

3. The case of the petitioners is that the respondent-M/s. Securities and Exchange Board of India, Mumbai (hereinafter referred to as 'SEBI') has filed a complaint against the accused persons under Section 200 of Cr.P.C. for the offence punishable under Sections 205(8) and 207 read with Sections 55A, 205(1A) and 621 of the Companies Act, 1956 alleging that accused No. 1-Kavveri Telecom Products Limited, Bengaluru being registered under the Companies Act, the SEBI was established under the Securities and Exchange Board of India Act, 1992 to protect the interests of investors in securities and to promote the development of and to regulate the securities market as well as matters connected therewith or incidental thereto Section 11 of the Securities and Exchange Board of India Act. Accused No. 1-Company engaged in business of manufacture of wireless telecommunication products. It has declared dividend to its shareholders at the Annual General Meeting (AGM) held on 29.09.2012 and total dividend declared at the AGM of accused No. 1-Company which is amounted to Rs. 3,01,86,390/-. As per Section 205(1A) read with Section 205(1C) of the Companies Act, accused No. 1 was statutorily required to deposit the amount of dividend declared into a separate Bank account within 5 days of such declaration and the accused were statutorily bound to transfer the said amount to the shareholders within thirty days. But accused No. 1 being a company represented by accused No. 2 who is a Managing Director of the said company and accused Nos. 3 to 7 are the Directors of the Company who are responsible for the day to day affairs of the Company have not deposited the said amount to the investors or shareholders within prescribed time. Therefore, a Show Cause notice was also issued after receiving the complaints from the shareholders. Accused No. 1 given reply on 23.02.2013 and on the notice of the respondent dated 13.02.2013, accused No. 1 sought two weeks' time to provide the information as accused Nos. 2 to 5 were in abroad. Accordingly, the petitioner sent a letter to the complainant on 13.03.2013 on untenable ground seeking further time. The complainant further alleges that the accused with a malafide intention of defrauding its investors, despite several complaints by investors and reminders from the complainant has failed to comply with its obligations and duties as required under the Companies Act. The accused also required to pay the dividend with 18% interest per annum. The complainant received a letter dated 28.06.2013 from accused No. 1 where they have categorically admitted for violating the provisions of Companies Act. Thereby, the accused persons are committed the above said offences. Hence, the prosecution came to be launched against the petitioners which is under challenge.

4. Learned counsel appearing for the petitioners has contended mainly that the alleged offences are said to have been committed in the year 2013 and the complaint came to be filed in the year 2016, after the lapse of three years. Therefore, no cognizance can be taken and there was a bar for taking cognizance as per Section 468 of Cr.P.C. The learned counsel further contended that the complaint came to be filed in the year 2016, at that time, the new Companies Act, 2013 came into force and the old Companies Act, 1956 was not in existence, therefore, the criminal prosecution under the old Act cannot be sustained. He further contended that as on the date of filing of the complaint, no dividend is required to be payable by the accused. Therefore, there is no offence committe