IMPORTANT POINT
Directors' liability under the ESI Act is limited to their period of directorship, and they cannot be held liable for actions of the company after they have ceased to be directors.

JUDGMENT

Tushar Rao Gedela, J. (Oral)

[The proceeding has been conducted through Hybrid mode]

1. This is a petition under Section 482 Cr.P.C., 1973 read with Article 227 of the Constitution of India praying for necessary orders and directions for quashing the complaint No. 4872/2020 under the 85(G) of the Employees' State Insurance Act, 1948 (hereinafter referred to as `ESI Act') pending before the learned CMM, South East District, Saket Courts, New Delhi.

2. The relevant brief facts as culled out from the petition are as under:

"2. Briefly, the fact of the case are that on 2.09.2014 Minutes of Proceedings of the Extra Ordinary General Meeting of Respondent No. 2 was held at New Delhi wherein amongst other resolutions the Chairman proposed the resolution that the resignation of Petitioner from Directorship of the Company was accepted with effect from 2.09.2014. This resolution was passed unanimously and as such the Petitioner ceased to be the Director of the Company w.e.f 2.09.2014.

3. That in the same Minutes of Meeting of 2.09.2014 the Chairman proposed the appointment of Gonzalo Gomez Garcia and Santiago Cabezas Carbonell as the new Directors of the Company.

4. That the Respondent no. 3 Rajesh Kumar Jha, the Managing Director of the Company was given the authorization to sign and send the notice for the above said Extra Ordinary General Meeting to the members and to file the Form DIR-12 with ROC, Delhi.

5. That on 2.09.2014 itself pursuant to Section 152 (5) and Rule 8 of the Companies (Appointment and Qualification of Director) Rules, 2014 consent is given by Gonzalo Gomez Garcia and Santiago Cabezas Carbonell to act as the Directors of the Company who are of Spanish Nationality. As such pursuant to Section 164(2) and Rule 14(1) of the Companies (Appointment and Qualification of Director) Rules, 2014 Gonzalo Gomez Garcia and Santiago Cabezas Carbonell were appointed as the Directors of the Company.

6. That on 2.09.2014 itself the Petitioner formally tendered his resignation for the post of the Director of the Company. In the letter the Petitioner sited personal reasons for this decision and also asked the Board of the Directors to relieve him w.e.f 2.09.2014. The Petitioner also asked the Board of Directors for arranging to submit the necessary forms with the office of the Registrar of Companies, NCT of Delhi & Haryana accordingly.

7. That on 9.12.2019 and again on 13.12.2019 the Respondent No. 1 issue Notice U/s 45 (2) of the ESI Act, 1948 asking for the following records such as Muster Roll, Wages/salary Register, Cash Books, Ledger and supportive vouchers in r/o balance sheet (s)/P&L A/c's. All other documents pertaining to employment. Contractors records, viz. names and insurance number of all contractor Employees, their attendance/wages records/Copy of Return of contribution(s). Copies of challans for ESI contribution/return of contribution. Inspection book under regulation 102-A. Employees/Contribution Register Under Regulation 32. Accident book under Regulation 66. Returns of Contribution and Return of Declaration Forms. All documents relating to Constitution of Firm/Factory/Company/Establishment. TDS Deducted & deposited (in respect of employees as well as of Contractors) and copies of Form 16 issued to employees.

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12.That on 6.10.2020 a complaint is filed by the Respondent No. 1 against the Respondent No. 2 company for offences U/s 85 (G) of the ESI Act, 1948 before the court of CMM, Saket Court wherein the Petitioner is also arrayed as accused No.3. In the complaint it is alleged that the accused being under the statutory obligation to pay the contribution amount as required under ESI Act, 1948 in respect of the employees has failed to produce the records at the time of Inspection of document and for verifying correction of the correction of the due contribution which has to be paid by the unit under ESI Act, 1948. It also alleged that the Respondent No. 1 personally visited the