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1987 Supreme(Del) 444
High Court Of Delhi
KULDIP SINGH - Appellant
Versus
STATE OF DELHI - Respondent
Criminal Miscellaneous (Main) 1478 of 1986
Decided On : 11/17/1987
C.L.Behl, M.S.Gandhi, RAJIV NANDA, S.K.DUBEY, S.K.MISHRA, USHA KUMARI
Offences under Sections 159 and 220 of the Companies Act 1956 for failing to file annual returns, balance sheets, and profit and loss accounts within the prescribed period are continuing offences, and therefore, the limitation period prescribed by Section 468 of the Code of Criminal Procedure 1973 does not apply.
Headnote:
COMPANIES ACT - SECTIONS 159, 162, 220 - CONTINUING OFFENCES - ANNUAL RETURNS, BALANCE SHEETS, AND PROFIT AND LOSS ACCOUNTS - LIMITATION - SECTIONS 468, 472 OF THE CODE OF CRIMINAL PROCEDURE 1973 - INTERPRETATION.
Fact of the Case:
The petitioners were charged with offences under Sections 159, 162, and 220 of the Companies Act 1956 (the Act) for failing to file annual returns, balance sheets, and profit and loss accounts within the prescribed period. The complaints were filed after a period of six months, which is the limitation period for offences punishable with a fine only under Section 468 of the Code of Criminal Procedure 1973 (the Code). The petitioners contended that the offences were not continuing offences and, therefore, the complaints were barred by limitation.
Finding of the Court:
The court held that the offences under Sections 159 and 220 of the Act were continuing offences and, therefore, the limitation period prescribed by Section 468 of the Code did not apply. The court found that the purpose of the provisions of Sections 159 and 220 of the Act was to make public the information relating to the financial positions of companies and their officers. By requiring the filing of annual returns, balance sheets, and profit and loss accounts, the public could have access to this information on inspection of the records of the Registrar of Companies.
Issues: 1. Whether the offences under Sections 159 and 220 of the Act were continuing offences? 2. Whether the limitation period prescribed by Section 468 of the Code applied to the offences?
Ratio Decidendi: 1. The court interpreted the provisions of Sections 159, 162, and 220 of the Act and found that the language used therein indicated that the offences were continuing offences. The court noted that the provisions required the filing of annual returns, balance sheets, and profit and loss accounts within a particular period and that the company and its officers were compelled to make public the information relating to their financial positions. The court also considered the objects of the provisions, which were to make this information available to the public, and found that the offences were continuing in nature. 2. The court held that the limitation period prescribed by Section 468 of the Code did not apply to the offences because they were continuing offences. The court referred to Section 472 of the Code, which provides that a fresh period of limitation shall begin to run at every moment of the time during which a continuing offence continues.
Final Decision: The court dismissed all the petitions, holding that the offences under Sections 159 and 220 of the Act were continuing offences and, therefore, the limitation period prescribed by Section 468 of the Code did not apply.
( 1 ) THE only question that arises in this petition and other petitions which are being disposed of by this order is if the offences under Sec. 159 read with Sec. 162 and Sec. 220 again read with Sec. 162 of the Companies Act 1956 (for short the Act ) are continuing offences within the meaning of Sec. 472 of the Code of Criminal Procedure 1973 (for short the Code ) so as to remove the bar of limitation to take cognizance of the offences as provided by Sec. 468 of the Code. Under sub s. (1) of Sec. 468 of the Code, a court cannot take cognizance of an offence after the expiry of the period of limitation as provided under sub-s. (2) of that section. In the case where the offence is punishable with fine only, the period of limitation prescribed is six months. Sec. 472 of the Code provides however, that in the case of a continuing offence, a fresh period of limitation shall begin to run at every moment of the time during which the offence continues. Sec. 159 of the Act provides for filing of annual returns by the company and fixes the time by which the annual return is to be filed with the Registrar of Companies. The return is to be in the form prescribed and is to contain various particulars as mentioned in the section. Sub-s. (1) of S. 220 of the Act provides for filing of balance-sheet and the profit and loss account with the Registrar of Companies. These documents are to be filed within thirty days from the date on which the balance-sheet and the profit and loss account were laid at the annual general meeting of the company. Where, however, the annual general meeting of a company for any year has not been held then also copies of the balance-sheet and profit and loss account duly signed as provided are to be filed with the Registrar of Companies within thirty days from the latest day on or before which the annual general meeting should have been held. This latter requirement was added by the Companies (Amendment) Act 1977. Under sub-s. (3) of Sec. 220 of the Act, so far as is relevant in the present case, if a default is made in complying with the requirements of sub-s. (1) of Sec. 220, the company and every officer of the company who is in default shall be liable to punishment as provided by S. 162 which is same as for default in complying with the provisions of Sec. 159 as well. Sec. 162 of the Act may now be set out as under : -
"162 (1) If a company fails to comply with any of the provisions contained in sections 159, 160 or 161, the company, and every officer of the company who is in default, shall be punishable with fine which may extend to fifty rupees for everyday during which the default continues. (2) For the purposes of this section and sections 159,160 and 161, the expressions "officer" and "director" shall include any person in accordance with whose directions or instructions the Board of Directors of the company is accustomed to act. "admittedly, in the present cases, the complaints were filed after a period of six months when time for filing of annual return, balance-sheet and profit and loss account had expired. If it is/held that the offences under Sec. 159 and 220 of the Act are not continuing offences, the complaints would be barred by limitation. The learned Addl. Chief Metropolitan Magistrate held the offences under Secs. 159 and 220 of the Act as continuing offences. The plea of the petitioners to the contrary was also negatived by the Addl. Sessions Judge who heard some of the revisions against the orders of the Addl. Chief Metropolitan Magistrate.
( 2 ) IT was contended by Mr. C. L. Behl, learned counsel for the petitioners, that offence under Sec. 162 of the Act for contravening the provisions of Sees. 159 and 220 of the Act could not be said to be a continuing offence. He said there were certain sections in the Act which providedfor punishment in the case of continuing offences. In this connection, Mr. Behl REFERRED TO to Secs. 168, 234 and 598 of the Act Sec. 168 levies penalty for d
