9911796707
TMI Blog1983 (9) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... The two petitions have been filed under section 482 of the Code of Criminal Procedure for quashing the proceedings in the criminal case mentioned above. The Assistant Registrar of Companies, Madras, who is the complainant in the case, has filed the complaint against the petitioners and two other accused, viz., one T. R. Dharaneedharan (accused No. 4) and S. T. Adityan (accused No. 11), alleging commission of offences under section 200 of the Code of Criminal Procedure read with section 58A(3)(a) and section 58A(5) of the Companies Act, 1956. The complaint proceeds as follows : The first accused is a public limited company incorporated under the Indian Companies Act. Accused Nos. 2 to 13 have been impleaded in their capacity as present dire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1971, to June 30, 1975, and return of deposits during the period between March 31, 1975, and June 30, 1976, revealed that the company was entitled to have deposits only to the extent of Rs. 9,38,844 as on June 30, 1971. But the company had accepted deposits exceeding the limit prescribed under the Reserve Bank of India directions. The total amount of unsecured loans and deposits amounted to Rs. 37,40,508 12. It was noticed that the company had received loans or deposits from the members or from the general public as under: Date: Amount: Rs. From Aditanar Educational Institution 23-3-1973 3,50,000 11-4-1973 1,00,000 19-4-1973 1,00,000 2-1-1975 8,00,000 From K.R.Sharma ... 15-9-1973 1,000 From S.Rajalakshmi ... 14-12-1973 1,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to transactions entered into earlier. Further, the pro-visions of section 58A offend article 19(1)(a), (b) and (g ) as well as article 14 of the Constitution. Even assuming that a complaint can be made for non-compliance with the provisions of section 58A(3)(c ), the position would be that so far as deposits received up to June 30, 1971, are concerned, there was no contravention of the Reserve Bank of India directions since the amounts received from shareholders were not treated as deposits within the meaning of the term "deposit". Even as regards deposits received between March 23, 1973, and January 2, 1975, there has been no contravention of the Reserve Bank of India directions. Up to January 1, 1972, the deposits received by the company, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for prosecution. The last submission made is that a prosecution under section 58A of the Companies Act offends article 20 of the Constitution and on that ground also, the complaint is not maintainable. Though several contentions have been raised by the petitioners in their petitions, Mr. G. Vasantha Pai, learned counsel for the petitioners, advanced arguments before me only in respect of the last mentioned contention. Learned counsel pointed out that the offences alleged to have been committed, viz., receiving of deposits in contravention of the section, took place during the period March 23, 1973, to January 2, 1975, and the said period would fall within the date June 3, 1975, till which date the Reserve Bank of India directions were in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... place prior to June 3, 1975, till which date the directions issued by the Reserve Bank of India were in force. Hence, the contravention, if any, would attract punishment only up to three years' imprisonment but not imprisonment up to five years as provided for in section 58A(5)(b ) of the Companies Act. Therefore, the prosecution is violative of article 20 of the Constitution. Mr. Vasantha Pai further submitted that the company had complied with the provisions of section 58A of the Companies Act and the rules framed thereunder even during the financial year ended June 30, 1980. In the balance-sheet, the auditors have certified that the company has complied with the provisions of section 58A of the Companies Act, 1956, and the rules framed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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