TMI Blog2000 (2) TMI 720X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. V.S. Raju, is that the petitioners are merely the directors of the company which has been shown as A-1 and that in view of the definition of the Officer who is in default as given in section 5 of the Act, where there is a managing director or a whole time director or a manager or a secretary the liability for any criminal offence attributed to the company cannot be assigned to ordinary directors. 3. This is countered by the learned counsel for the respondents. Shri P.V.S.S.S. Rama Rao, and it is urged that even where a company has a managing director or a whole time director or a manager or a secretary, the question whether other directors are liable or not would depend on the facts and circumstances of the case and those facts a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th day also imprisonment with a term which may extend to one year. Similarly, section 113(2) provides that in the case of contravention of the provisions of section 113(1) the company and every officer of the company who is in default shall be punishable with fine which may extend to Rs. 500 per every day during which the default continues. 7. Thus, the basis of fastening of liability on the officers of the company for contravention of sections 73(2A) and 113(2) is that the officer who is sought to be made liable should satisfy the definition of Officer in default . The phrase Officer in default has been defined in section 5 which is extracted below : "5. Meaning of Officer who is in default For the purpose of any provision i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e definition of the Officer who is in default as given in section 5 would make it amply clear that the criminal liability of ordinary directors would arise only in respect of a company which has no managing director or a whole time director or a manager and where particular directors are not specified to be liable by the company. In this case a reading of the complaint would disclose that A-2 has been described as the managing director of the company. Thus, it cannot be said that this A-1 company has no managing director. Thus, in this case inasmuch as A-1 the company has an officer described as managing director within the meaning of section 5, the question of any other director being liable for the criminal acts of the company abovement ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
