The central legal point established in the judgment is that mere canvassing for deposits does not necessarily make a person liable under Section 5 of the Tamil Nadu Protection of Interest of Depositors Act. The judgment emphasized the need for specific averments in the complaint to establish vicarious liability and the obligation for the accused to prove lack of knowledge or due diligence only when the prosecution establishes the requisite conditions mentioned in the Act.

1. This Criminal Revision Case is filed against the order dated 21.1.2013 made in Cr.MP.No.2234/2012 in CC.No.6/2009 by the learned Special Judge for TNPID Cases, Madurai, dismissing the petition filed under Section 227 of Cr.PC, seeking to discharge the Petitioner/A11 from the criminal proceedings in CC.No.6/2009.

2. The Petitioners, arrayed as A11, contended that she has nothing to do with A1 Partnership Firm, namely, M/s.Udhayam Motors, which is facing trial along with the other accused for the offence alleged to have been committed under Section 5 of the Tamil Nadu Protection of Interest of Depositors Act, 1997 (herein after referred to as the Act). According to the Petitioner, A1 Firm is the Partnership Firm not registered under the provisions of law and the Petitioner was not at all the partner of the said unregistered Partnership Firm at any point of time nor she was involved in the affairs of the Financial Institution. The statements obtained by the Respondent Police from various witnesses do not make out any offence as against the Petitioner herein. The Petitioner has been implicated for the simple reason that the Petitioner herein is closely related to A3 R.Selvakumar, i.e. Petitioner/A11 is the wife of A3. Therefore, the Petitioner has sought for discharge from the criminal Prosecution launched by the Respondent Police.

3. The Respondent contended that all the Partners of A1 Firm committed default in repayment of deposits and interest to the defacto complainants even after maturity. It is further stated that during the investigation by the Respondent Police, it came to light that the Petitioner had instigated the depositors to deposit their money with A1 Firm and she is the active participants in the activities of A1 Firm.

4. The points that arise for determination are as (1) whether the Petitioner, who is allegedly partner of A1 Firm, is liable to answer the charge under Section 5 of the Act and (2) whether the Petitioner was responsible for the management of the affairs of the Financial Institution.

5. The learned counsel for the Petitioner would vehemently submit that under Section 5 of the Act, only those persons, who are partners of the Registered Firm, would be liable and not innocent parties like the Petitioner herein. He would also submit that the Petitioner herein is neither partner nor she is the beneficiary and she has nothing to do with the day-today activities of the Partnership Firm, but has been implicated by the Respondent Police for the reasons best known to them. Therefore, the learned counsel would submit that the Petitioner, who has been roped in for the offence under Section 5 of the Act, just because she happened to be wife of A3, is entitled to be discharged from the criminal proceedings.

6. On the other hand, the learned Government Advocate would contend that the Petitioner is the participant in the activities of A1 Partnership Firm and she is the real partner of the said Firm. It is further submitted that the witnesses, examined by the Respondent Police during the course of investigation, have also spoken to the fact that the Petitioner canvassed the depositors to deposit the amount in A1 Firm and that canvassing for deposit for a financial institution would definitely amount to participation in the management of the affairs of the Firm and therefore, the Petitioner cannot shirk her responsibility in the management of the firm and lawfully seek for discharge.

7. In the counter, it is stated that A1 is a Partnership Firm not registered under the provision of law and all the signatures on the FDRs or promissory notes were executed by any one or two of the partners. It is further stated that the Petitioner has neither signed any of the FDRs alleged to have been produced by the Respondent Police nor had issued receipts in favour of the depositors for the deposits, but however, she has actively participated in the day-today activities of A1 Firm and so, she has been arrayed as accused