1999 (4) TMI 505 - HC - Companies Law

Summary

Issues Involved:
1. Quashing of proceedings under Section 207 of the Companies Act, 1956.
2. Quashing of proceedings under Section 17 read with Section 291 of the Companies Act, 1956, punishable under Section 629A.
3. Limitation period for filing complaints under the Companies Act, 1956.

Detailed Analysis:

1. Quashing of Proceedings under Section 207 of the Companies Act, 1956:
The petitioners in multiple criminal original petitions sought to quash proceedings under Section 207 of the Companies Act, 1956, which mandates that dividends must be paid within 42 days from the date of declaration. The complaints alleged that dividends were not dispatched within the stipulated time frame, constituting a violation of Section 207. The petitioners argued that the delay was due to financial constraints and not intentional. They also contended that the complaints were barred by time as they were filed beyond the one-year limitation period prescribed under Section 468 of the Criminal Procedure Code.

2. Quashing of Proceedings under Section 17 read with Section 291 of the Companies Act, 1956, punishable under Section 629A:
The petitioners in Crl. O.P. No. 1114 of 1999 were accused of conducting air taxi operations without amending the memorandum of association to include such activities, thereby violating Section 17 read with Section 291, punishable under Section 629A of the Companies Act. The petitioners argued that they had obtained necessary permissions and approvals from the respondent before diversifying into air taxi operations. They also contended that the complaint was barred by time as it was filed beyond the six-month limitation period for offenses punishable with a fine.

3. Limitation Period for Filing Complaints under the Companies Act, 1956:
The court examined the limitation period for filing complaints under the Companies Act. For offenses punishable with a fine (Section 629A), the complaint must be filed within six months. For offenses punishable with imprisonment (Section 207), the complaint must be filed within one year. The court noted that the complaints under Section 207 were filed beyond the one-year limitation period from the date of the show-cause notice, making them time-barred. Similarly, the complaint under Section 17 read with Section 291 was filed beyond the six-month limitation period, rendering it time-barred as well.

Judgment:
The court allowed Crl. O.P. Nos. 1114, 1119, and 2220 of 1999, quashing the proceedings in C.C. No. 461 of 1998, 455 of 1998, and 167 of 1998, respectively, as they were barred by time. However, Crl. O.P. Nos. 1121 and 1120 of 1999 were dismissed, as the complaints in C.C. No. 9 of 1997 and 301 of 1998 were filed within the limitation period. The court directed the trial court to consider the petitioners' defenses and dispose of the cases expeditiously.