2000 (3) TMI 941 - HC - Companies Law

Issues Involved:
1. Whether the offence under section 73(2B) read with section 73(2A) of the Companies Act, 1956 is a continuing offence within the meaning of section 472 of the Code of Criminal Procedure, 1973.
2. Whether the complaint filed on 30-11-1993 was time-barred under section 468 of the Code.
3. Whether the allegations in the complaint make out a case for an offence under section 73(2B) of the Companies Act, 1956.
4. Whether the complainant suppressed material facts to mislead the court regarding the period of limitation.

Detailed Analysis:

1. Continuing Offence under Section 73(2B) of the Companies Act, 1956:
The primary issue is whether the offence under section 73(2B), read with section 73(2A) of the Companies Act, 1956, is a continuing offence within the meaning of section 472 of the Code of Criminal Procedure, 1973. The court examined the language of the statute, the nature of the offence, and the purpose intended to be achieved by constituting the particular act as an offence. It was observed that under section 73(2A), the company is obligated to repay the excess amounts received from applicants forthwith, and failure to do so within eight days makes the company and its directors liable to repay the amount with interest. Section 73(2B) provides for punishment for default in complying with the requirement of section 73(2A). The court concluded that the offence under section 73(2B) is a continuing offence as the liability to repay the excess amount with interest continues until the repayment is made. Therefore, a fresh period of limitation begins to run at every moment of the time during which the offence continues, making section 468 of the Code inapplicable.

2. Limitation Period for Filing the Complaint:
The petitioners argued that since the alleged default was punishable only with fine under section 73(2B), the period of limitation for filing the complaint had expired on 16-8-1992, making the complaint filed on 30-11-1993 time-barred. However, the court held that since the offence under section 73(2B) is a continuing offence, the period of limitation prescribed by section 468 of the Code does not apply. Consequently, the complaint was not time-barred.

3. Allegations in the Complaint:
The petitioners contended that the allegations in the complaint did not make out a case for an offence under section 73(2B). The court noted that it could not make inquiries into disputed questions of fact or record its own findings thereon in the exercise of its jurisdiction under section 482 of the Code. Therefore, the alternative plea that there was no delay in refunding the excess amounts needed to be established before the Trial Court.

4. Suppression of Material Facts:
The petitioners claimed that the complainant had suppressed material facts, particularly the issue of the first show-cause notice dated 17-12-1992, to mislead the court regarding the period of limitation. The court did not specifically address this issue in detail, focusing instead on the nature of the offence and the applicability of the limitation period.

Conclusion:
The court dismissed the petition, holding that the offence under section 73(2B) is a continuing offence, and therefore, the period of limitation under section 468 of the Code does not apply. The Trial Court was directed to proceed with the trial in accordance with the law, uninfluenced by any observations made on the merits of the case. The court also appreciated the assistance rendered by the young Advocate representing the Registrar of Companies.

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