PRADEEP NANDRAJOG, J.

( 1 ) SECURITIES and Exchange Board of India (SEBI) filed a complaint against the petitioners under Section 200 of the Code of Criminal Procedure, 1973 read with section 24 (1) and 27 of the Securities and exchange Board of India, 1992. Inter alia, it was stated that Section 11 of the Act casts upon SEBI the duty to protect the interest of investors in securities and that SEBI was enjoined upon to promote the development of and to regulate the securities market through appropriate measures.

( 2 ) IT was stated that the last decade had witnessed initiative by private entrepreneurs to undergo plantation activities on a commercial scale. It was noted that promoters would invest minimal amounts in such ventures. They would raise funds from ordinary investors in the absence of regulatory mechanisms. It was stated that the high returns promised under the schemes were questionable. It was stated that in the year 1997 certain guidelines were framed pertaining to plantation companies.

( 3 ) LISTING out various regulations which require to be complied with in the year 1997 and alleging that the same were not complied with, complaint was filed alleging violation of Section 27 of the Act as also the regulations framed.

( 4 ) PERTAINING to petitioners 1 to 7 who were impleaded as respondents 2 to 9 following averments were made in para 7 of the complaint :-

"7. The accused No. 1 is a company registered under the provisions of the companies Act and the accused No. 2 to 9 are the directors of the accused no. 1 company. The accused No. 2 to 9 are the persons incharge and responsible for the day to day affairs of the company and all of the were actively connived with each other for the commission of the offences. "

( 5 ) AT the hearing, learned counsel for the petitioners urged a limited submission being that the averment that petitioners were the directors and person in charge and responsible for the day-today affairs of the company was insufficient to proceed against the petitioners. Thus, counsel urged that the order dated 15. 12. 2003 summoning the petitioners to answer the charges was liable to be quashed.

( 6 ) I need not discuss a plethora of authorities on the issue as to what constitutes sufficient averments in a complaint to make it actionable vis-a-vis the directors of a company.

( 7 ) OFFICERS responsible for the conduct of the affairs of a company are generally referred to as directors, managers, secretaries etc. With reference to Sections 291 to 293 of the Companies Act, 1956 it would be evident that what a board of directors of a company is empowered to do depends upon the roles and functions assigned to the directors as per the memorandum and articles of association of a company.

( 8 ) IT would be sufficient for me to state that the question as to what is the role of a director in a company is a question of fact.

( 9 ) SINCE criminal liability is foisted upon a director not merely on account of his or her being a director but on account of a conduct, act or omission, there must be a averment in a complaint relatable to the said act or omission.

( 10 ) WHAT would be said sufficient averment?

( 11 ) THE answer is found in a 3 member bench decision of the Supreme Court reported as SMS Pharmaceuticals Ltd. Vs. Neeta Bhalla and Ors. 2005 VIII AD (S. C.) 107 = 2005 8 SCC 89 wherein it was observed that a clear, unambiguous and specific allegation against a person impleaded as an accused that he was in charge of and responsible to the company in the conduct of its business at the material time when the offence was committed is sufficient.

( 12 ) DECISION in SMS Pharmaceuticals Ltd. 's case has been a subject matter of consideration by the Supreme Court in the latest pronouncement reported as n. Rangachari Vs. BSNL (2007) 5 SCC 108 in para 19, 21 and 23 following was observed by the Supreme Court :-

"19. Therefore, a person in the commercial world having a transaction with a company is entitled to presume

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