Home Case Index All Cases Companies Law Companies Law + HC Companies Law - 2022 (8) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (8) TMI 883 - HC - Companies LawCompounding of offence under Section 266G of the Companies Act, 1956 - discretionary power exercised in compounding the offence by the Board under 266C read with Section 621A of the Act - contravention of Section 266G of the Act or not - Whether the compounding of the offence by the Board under Section 266C read with Section 621A is justified without seeking prior permission from the Court? - HELD THAT:- The company does not dispute that they had applied for three DINs, but specifically contends that obtaining of DIN was by using different IDs and address and was obtained due to inadvertence and not intentional and contended that the company was only using one DIN. To consider whether order of the Board is justifiable, relevant provisions needs to be considered - A careful reading of the provisions envisage that it excludes such offences which are punishable with imprisonment only or with imprisonment and also with fine. Thus, on facts, the nature of offence which the company has charged does not invite with imprisonment or imprisonment and fine, but the penalty imposed is punishable with fine, which may extend upto five thousand rupees and where the contravention is continuing one, with a further fine, which may extend to five hundred rupees for everyday thereafter. Thus, the nature of offence is such that it is compoundable, and the same is just and proper. Whether the compounding of the offence by the Board under Section 266C read with Section 621A is justified without seeking prior permission from the Court? - HELD THAT:- The appellant sought to contend that prior permission of the Court needs to be accorded for compounding of offence is contrary to the intention of the legislature for enacting the provision under Section 621A as the powers under Section 266C are concurrent/parallel powers to be exercised by the Company Law Board/other Authorities or Court in seisin of the matter with a difference that a Company Law Board can proceed to compound such offence either before or after the institution of any prosecution whereas criminal Court possesses similar power to compound such offence only after institution of prosecution and as the Apex Court held in the case of VLS. FINANCE LTD. VERSUS UNION OF INDIA AND OTHERS [2013 (5) TMI 348 - SUPREME COURT] where it was held that while interpreting the provisions of a statute, the court avoids rejection or addition of words and resort to that only in exceptional circumstances to achieve the purpose of Act or give purposeful meaning. It is also a cardinal rule of interpretation that words, phrases and sentences are to be given their natural, plain and clear meaning. Appeal dismissed.
|