2005 (10) TMI 290 - HC - Companies Law

Summary

Issues:
- Whether non-filing of annual return under sections 159/220 of the Companies Act, 1956, is a continuing offence.

Analysis:
- The case involved a complaint filed by the Registrar of Companies against the respondents for not filing the annual return and not convening the Annual General Meeting as required by sections 159/220 of the Companies Act, 1956. The respondents argued that the complaint was time-barred as the cause of action had accrued earlier, and the offense was punishable with a fine only. The trial Magistrate dropped the proceedings based on this argument.

- The petitioner contended that the offenses under sections 159 and 220 of the Companies Act are continuing offenses and not time-barred. The counsel argued that the Magistrate erred in dismissing the complaint without considering the provisions of the Companies Act.

- The court examined sections 159 and 220 of the Companies Act, which mandate the filing of annual returns and balance sheets within specified timelines. It noted that non-compliance could result in fines as per section 162 of the Act for each day of default. The court cited a Supreme Court case and other High Court decisions to establish that such offenses are considered continuing offenses.

- Referring to the Supreme Court's observation that the nature of the offense and the intended purpose of the statute determine if an offense is continuing, the court emphasized that the failure to file required documents under the Companies Act constitutes a continuing offense. It cited judgments from the Calcutta High Court and Delhi High Court supporting this interpretation.

- Ultimately, the court upheld that offenses under sections 159 and 220 of the Companies Act are continuing offenses. It set aside the Magistrate's order and directed a further inquiry in accordance with the law, based on the established legal principles and precedents.