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IN THE HIGH COURT OF JUDICATURE AT MADRAS
G. CHANDRASEKHARAN, J.
M/s. Kanya Resorts Private Limited, Chennai & Others - Appellant
Versus
The Assistant Registrar of Companies, Chennai - Respondent
Crl.O.P. No. 28307 of 2019
Decided On : 26-05-2022
Companies Act, 2013 - Criminal Proceedings - Section 137, 92, 129, 96, 99 - E.O.C.C.Nos. 429, 430, 428, 380, 381, 382, 386, 385, 384, 383 of 2018 - The court dismissed the petitions filed to quash the proceedings, citing that the offenses alleged were statutory violations for non-compliance with mandatory provisions and that the Additional Chief Metropolitan Magistrate had taken cognizance of the cases after reviewing the complaint allegations and supporting materials.
Fact of the Case:
The accused were charged with non-compliance with various sections of the Companies Act, 2013, related to filing financial statements, annual returns, and conducting annual general meetings within the stipulated time.
Finding of the Court:
The court found that the petitions were filed to protract the proceedings without merit and dismissed them, stating that the offenses alleged were statutory violations and that the Additional Chief Metropolitan Magistrate had taken cognizance of the cases after reviewing the complaint allegations and supporting materials.
Issues: The main grounds for the quash petitions were the lack of show cause notice prior to launching the criminal prosecution, absence of specific averments about the responsibility of directors, and the absence of a speaking order by the Additional Chief Metropolitan Magistrate at the time of taking cognizance of the cases.
Ratio Decidendi: The court held that the allegations of no show cause notice and lack of specific averments about the role of directors were not accepted, and that the offenses alleged were statutory violations for non-compliance with mandatory provisions.
Final Decision: The petitions were dismissed, and connected miscellaneous petitions, if any, were also closed.
JUDGMENT
(Prayer: Criminal Original Petition has been filed under Section 482 of the Code of Criminal Procedure, to call for the records in EOCC.No.429 of 2018 on the file of the learned Additional Chief Metropolitan Magistrate Economic offences, Egmore, Chennai – 8 and quash the proceedings as an abuse of process of Law.)
Common Order
1. These Criminal Original Petitions have been filed to call for the records in EOCC.Nos.429, 430, 428, 380, 381, 382, 386, 385, 384, 383 of 2018, respectively, on the file of the Additional Chief Metropolitan Magistrate Economic offences, Egmore, Chennai – 8 and quash the proceedings as an abuse of process of Law.
Crl.O.P.No.28307 of 2019:
E.O.C.C.No.429 of 2018 was filed under Section 137 (1) r/w Section 137 (3) of the Companies Act, 2013. The allegations made in the complaint is that a copy of the financial statement, consolidated financial statement, if any duly adopted for the year 2016-2017 should have been filed with the complainant within 30 days of the date of Annual General Meeting with such fees or additional fees as may be prescribed within the specified time. In this case, the copy of the financial statements have so far not been filed with the complainant despite issuance of the show cause notice dated 13.08.2018. Therefore, the accused is liable to be prosecuted for not complying with the provisions under Section 137 (1) r/w Section 137 (3) of the Companies Act, 2013.
Crl.O.P.No.28312 of 2019:
E.O.C.C. No.430 of 2018 was filed under Section 92(4) r/w 92 (5) of the Companies Act, 2013. The allegations made in the complaint is that the copy of Annual Return for the year 2016-2017 should have been filed with the complainant within 60 days from the date of Annual General Meeting in terms of Section 92(4) of the Act. In this case, the copy of the Annual Returns have so far not been filed with the complainant despite issuance of the show cause notice dated 13.08.2018. Therefore, the accused is liable to be prosecuted for not complying with the provisions under Section 92(4) r/w 92 (5) of the Companies Act, 2013.
Crl.O.P.No.28314 of 2019:
E.O.C.C. No.428 of 2018 was filed under Section 129(2) r/w 129(7) of the Companies Act, 2013. The allegations made in the complaint is that the copy of financial statements for the year 2016-2017 ought to have been laid in the Annual General Meeting within the stipulated time on or before 30.09.2017 in accordance with Section 129(2) of the Act. In this case, the copy of the financial statements have so far not been filed despite issuance of the show cause notice dated 13.08.2018. Therefore, the accused is liable to be prosecuted for not complying with the provisions under Section 129(2) r/w 129(7) of the Companies Act, 2013.
Crl.O.P.No.28734 of 2019:
E.O.C.C.No.380 of 2018 was filed under Section 129(2) r/w 129(7) of the Companies Act, 2013. The allegations made in the complaint is that the copy of financial statements for the year 2015-2016 ought to have been laid in the Annual General Meeting within the stipulated time on or before 30.09.2016 in accordance with Section 129(2) of the Act. In this case, the copy of the financial statements have so far not been filed despite issuance of the show cause notice dated 28.11.2017. Therefore, the accused is liable to be prosecuted for not complying with the provisions under Section 129(2) r/w 129(7) of the Companies Act, 2013.
Crl.O.P.No.28739 of 2019:
E.O.C.C.No.381 of 2018 was filed under Section 96(1) punishable under Section 99 of the Indian Companies Act, 2013. The Annual General Meeting ought to have been held for the financial year ending 31.03.2016 on or before 30.09.2016. The accused have not conducted the Annual General Meeting for the financial year ending 31.03.2016, thus, violated the provisions under Section 96 (1) punishable under Section 99 of the Indian Companies Act, 2013.
Crl.O.P.No.28741 of 2019:
E.O.C.C.No.382 of 2018 was filed under Section 92(4) r/w 92(5)
The nature of the offenses and the prescribed penalties determine whether the offenses are continuing or one-time, and the applicability of limitation periods. Prosecutions under the repealed 1956 Ac....
The court may exercise its inherent powers to quash criminal proceedings when the prosecution fails to prove the service of show-cause notices (where voluntarily issued) and where the accused entity ....
Non-consideration of the petitioners' replies and defective show cause notice amount to non-application of mind, rendering the complaint unsustainable in law.
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