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G. K. ILANTHIRAIYAN
Vasantha Kumar Ayyavu Palanichamy – Appellant
Versus
Securities and Exchange Board of India, Overseas Towers, No 756, Anna Salai, Chennai-600 002. Represented by its Assistant General Manager, Mr. Deepu Anandan – Respondent
ORDER :
This Criminal Original Petition has been filed to quash the proceedings in C.C.No.44 of 2021 on the file of the learned Principal Sessions Judge at Chennai having been taken cognizance for the offences under Sections 24(1) of Securities and Exchange Board of India Act, 1992, Section 207 of the Companies Act, 1956 and Section 127 of the Companies Act, 2013.
2. The case of the prosecution is that the respondent lodged a complaint for the offences under Sections 24(1) of Securities and Exchange Board of India Act, 1992, (herein after called as “SEBI Act”), Section 207 of the Companies Act, 1956 and Section 127 of the Companies Act, 2013 as against the petitioner. There are totally seven accused in which the petitioner is arrayed as A7. On 01.06.1995, the Company called “Zylog Systems Limited” was incorporated. All the accused persons were in-charge and responsible for the conduct of the business of the company. While being so, on 25.09.2012, the company declared a dividend to the tune of Rs.16,44,64,200/-. It was not paid to the shareholders within the stipulated time. On 13.02.2013, the respondent sought for information as required under Section 11(2) (i) of the SEBI Act from t
Non-payment of declared dividends is continuing offence; executive directors liable without prior notice; company impleadment not mandatory.
The main legal point established in the judgment is that the accused company's failure to comply with the provisions of the Companies Act, 1956 regarding the deposit and disbursement of declared divi....
The specific averments in a complaint against a director, as a person in charge of the company's affairs, may be sufficient to make out a case against the director, and the question of liability shou....
The defense of the accused regarding their knowledge of the company's activity cannot be adjudicated at the time of framing of charge and should be considered during trial. The onus of proof on the a....
The court emphasized the importance of procedural compliance and the distinction between civil and criminal liability in cases involving business disputes and misuse of information.
The judgment established the principle that for criminal liability of an officer of a company, there must be sufficient evidence of their active role in the transaction, coupled with criminal intent,....
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