Alexander Thomas, J.

These appeals arise out of the common judgment rendered by the Court of Additional Chief Judicial Magistrate (Economic Offences), Ernakulam on 26-2-2007 in the summary trial cases concerned. The summary trial cases arise out of a complaint preferred by the Assistant Registrar of Companies, Kerala, alleging commission of offence under Section 295(4) of the Companies Act, 1956. It was alleged in the complaint that the accused Nos. 1 to 3 are the members of the Board of Directors of the company involved in this case, viz. M/s. Koshy's Electronics Limited which is a public limited company registered under the Companies Act and 4th accused is the Company Secretary of the company and that they have committed the offence under the Companies Act, in so far as the accused No. 1 (Managing Director of the Company) has unauthorisedly drawn various amount totalling to Rs. 34.22 Lakhs from the funds of the company without the prior permission of Government of India as envisaged under Sec. 295(1) of the Companies Act and thereby all the accused have committed the offence as aforementioned.

2. The court below found that though the 1st accused has unauthorisedly withdrawn an amount totalling to Rs. 34.22 Lakhs on various occasions from the company, but as the 1st accused had re-paid the entire amounts due to the company as evident from Ext D-2, the accused who are facing trial need not be penalised and accordingly held that the accused in these cases are found not guilty under Sec. 295(4) of the Companies Act and thus they were acquitted under Sec. 255(1) Cr.P.C. It is this judgment of the court below that is under challenge in this appeal. It is brought to the notice of this Court that one of the respondents (viz., Accused No. 2-Oommen P. Koshy), has died after the pronouncement of the trial court judgment and this is not disputed by the learned counsel for the appellants and that these appeals as regards the said accused has already been abated.

3. Sub-section (1), (2) and (4) of Sec.295 reads as follows:

"295. Loans to directors, etc.--(1) Save as otherwise provided in sub-section (2), no company (hereinafter in this section referred to as 'the lending company') without obtaining the previous approval of the Central Government in that behalf shall directly or indirectly, make any loan to, or give any guarantee or provide any security in connection with a loan made by any other person to, or to any other person by,

'(a) any director of the lending company or of a company which is its holding company or an partner or relative of any such director;

(b) any firm in which any such director or relative is a partner;

(c) any private company of which any such director is a director or member;

(d) any body corporate at a general meeting of which not less than twenty five per cent of the total voting power may be exercised or controlled by any such director or by two or more such directors together; or

(e) any body corporate, the Board of Directors, Managing Director, or Manager whereof is accustomed to act in accordance with the directions or instructions of the Board, or of any director or directors, of the lending company.'

(2) Sub-section (1) shall not apply to--

(a) any loan made, guarantee given or security provided--

(i) by a private company unless it is a subsidiary of a public company, or

(ii) by a banking company;

(b) any loan made by a holding company to its subsidiary company;

(c) any guarantee given or security provided by a holding company in respect of any loan made to its subsidiary company.

(3) * * * * *

(4) Every person who is knowingly a party to any contravention of sub-section (1) or (3) including in particular any person to whom the loan is made or who has taken the loan in respect of which the guarantee is given or the security is provided, shall be punishable either with fine which may extend to fifty thousand rupees or with simple imprisonment for a term which may extend to six months:

Provided that where any suc