( 1 ) THIS is an application under section 482 of the Code of Criminal Procedure for quashing the proceeding under sections 420/467/ 471/477a, Indian Penal Code read with section 120b and/or section 109/ 114 of Indian Penal Code being C-plaint Case no. 1483 of 1990 pending before the learned Metropolitan Magistrate, 12th court, Calcutta.

( 2 ) THE General Electric Company plc. London (hereinafter referred to as GEC plc.) is a well-known public Company incorporated in the United Kingdom having its registered office at 1, Stanhope Gate, London. It manufactures electronics, electrical and power generation apparatus and system. The General Electric Company of India Limited (hereinafter referred to as GECI) is one of the subsidiaries of GEC plc. in which GEC plc. holds 67% of its equity shares, registered in India under the Companies Act having its registered Office at Magnet House, 6 Chittaranjan Avenue, Calcutta. It manufactures sophisticated/high tech electrical equipment. Genelec Limited (hereinafter referred to as GL) was incorporated in Maharastra on 7th September, 1957 under the name 'hindoo Lighting Industries Pvt. Limited' which was changed to 'genelec Limited' with effect from 16th January, 1978. GECI acquired shares in GL in 1963 when share holding was substantially increased and GL became a subsidiary of GECI in 1965. GL issued capital to the public through prospectus dated 31st March, 1982 and through the same prospectus 2,23461 equity shares of Rs. 10/- each of GL then held by GECI were also offered for sale to the public. After such allotments on 16th August, 1982, the share holding of GECI in GL came down to 33% of GL's paid-up equity share capital. At present GL is a Public Limited Company having its registered office at 'magnet House' Narottam Morarji Marg, Ballard Estate, Bombay 400038 and its Head Office is located at 2nd Floor, 6 Chittaranjan Avenue, Calcutta-72. The equity shares of GL are listed both in Calcutta and Bombay Stock Exchange. GL has about 11,000 share holders spread all over the country and various Public Financial Institutions hold substantial shares in the Company. Shaw Wallace and Company Limited (hereinafter referred to as SWL) which has filed the complaint against the petitioners is a well known Public Company. M. B. Chhabria and Mr. K. R. Chhabria are the Chairman and Managing Director of the Shaw Wallace Company respectively. T. S. Venkatesan who has filed the complaint on behalf of the SWL is Executive Director of SWL.

( 3 ) AT all material times the petitioner no. 1 A. K. Khosla was and still is a whole time Director and Chairman of GECI having his Office at New Delhi. Petitioner no. 2 A. G. Williams is a Finance Director of GECI. Petitioner no. 3 Hemant Singh is the Managing Director of GFCI. Petitioner no. 4 P. K. Gupta is a Director of GECI and was a non-Executive Director of GL, petitioner no. 5 S. Coomar is Deputy Secretary of GECI.

( 4 ) THE impugned criminal proceeding arises out of sale of 5,37,000 fully paid equity shares of Rs. 10/- each of GL held by GECI to complainant SWL for a total consideration of Rs. 3,49,05,000/- (Rupees Three crores forty nine lakhs 'five thousand ). The allegations in the complaint may briefly be summarised as follows :

( 5 ) DURING negotiations accused nos. 1, 2, 3, 8, 9, 10 and 11 made the following representations in respect of the sale of the said shares of GL : (A) GL is an independent company havings its Board of Directors with its own independent Managing Director having been delegated with substantial powers of management; (B) GECI had no detailed knowledge of GL's working and in fact knew only that much as was and is published or made public by GL ; (C) Although GECI under Article 114 of the Articles of Association of OL, had the right to nominate, remove, and substitute such Board of Directors in GL as it may think fit not exceeding 30 No. of the total members of the Board of Directors for the time being in GL. GECI has in