Non-submission of balance-sheet and profit and loss account is an offence.

A complaint was filed by the Registrar of Companies of Andhra Pradesh against the respondents, alleging that they were the directors of a private limited company, which had been registered on 5th December, 1958, under the Companies Act, 1956. It was incumbent on the directors, in accordance with the provisions of the Companies Act ( section 166 ), to lay before the company a balance-sheet and profit and loss account of the company for the period 1958-59 and as hey had failed to do so, they were liable to punishment under section 210(5) of the Companies Act. The respondents-accused pleaded ‘not guilty ‘and urged that, as the First Annual General Meeting of the company could not be held for reasons beyond their control, there was no question of laying before the company a balance-sheet and profit and loss account as contemplated under section 166. The learned Magistrate accepted the plea of the respondents and dismissed the complaint acquitting them of the said charge. The State has come in appeal against this order.

The contention of the learned Public Prosecutor is that, an offence under section 210 of the Act has nothing to do with the holding of the general body meeting and is an independent offence in itself. Reliance has been placed for this purpose on the State of Bombay v. Bandhan Ram1. It was laid down therein that:

“ the fact that no general meeting of the company was held was, in the circumstances, no defence to the charge of not complying with the requirements of section 32. A person charged with an offence could not rely on his own default as an answer to the charge.”

The contention by the learned counsel, on the other side, is that, the ruling has no application as it is with reference to the provisions of section 32 of the old Act of 1913, the corresponding sections under the new Act having been substantially altered and that it is also distinguishable on facts.

Before proceeding to examine the arguments on either side, some facts regarding which there is no controversy may briefly be stated. It is admitted that the company “Messrs. Techniplant Private, Limited” was registered as a private company on 5th December, 1958. It consisted of the three accused-respondents is directors and shareholders, the fourth respondent being the Secretary of the company. The first respondent was the managing director but within two months of the registration and formation of the company he was made to resign and he was succeeded by the second respondent. Then, there were disputes between respondent No. 1 on the one side and the other respondents on the other. The first respondent got the books of the company sealed with the help of the police. There was an application in the High Court also and finally the company went into liquidation. A separate charge-sheet was filed against the directors for contravening the provisions of section 166 of the Companies Act, 1956, by not holding a general body meeting within 18months from the date of its incorporation. It was pleaded therein that, the meeting could not be held for reasons beyond the control of the accused as an application under section 397 and 398 of the Companies Act for winding up the company itself was filed in the High Court on 18th December, 1958, i.e., within the time-limit. The trial Court found the accused guilty but on appeal the sentences were set aside on the ground that there was no wilful default in not complying with the said provisions. In this context, it has to be determined whether the respondents could be held guilty for contravening the provisions of section 210 of the Companies Act, viz., for not placing before the company balance-sheet and profit and loss account at its Annual General Meeting.

Section 210 of the Companies Act, hereinafter called the Act, provides that,

“(1) At every Annual General Meeting of a company held in pursuance of section 166, the Board of Directors of the company shall lay before the company-

(a) a balance-sheet at the end of the pe