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Issues:
1. Quashing of Criminal Complaint No.106 of 2005 under Section 482 of the Code of Criminal Procedure. 2. Interpretation of Section 27 of the SEBI Act regarding liability of directors in cases of company offenses. Analysis: The judgment pertains to a petition seeking the quashing of a criminal complaint and an order dismissing an application for discharge under Section 482 of the Code of Criminal Procedure. The petitioner, a former director of a company engaged in Collective Investment Schemes, was accused of non-compliance with SEBI regulations. The core issue revolved around the petitioner's liability as a director for the company's actions post her resignation. The petitioner argued that she had resigned before the company's alleged offenses, supported by Form 32 and SEBI's admission of her resignation in 1998. The court delved into the interpretation of Section 27 of the SEBI Act, which deems individuals in charge of a company at the time of an offense as guilty. Citing precedents, the court emphasized the importance of establishing the timing of the offense concerning directorial liability. Notably, the court referenced a case where the absence of directorship during the offense led to quashing the complaint. In this case, the offense was deemed to have arisen post the petitioner's resignation, challenging her culpability as a director. Considering the petitioner's documentary evidence and SEBI's acknowledgment of her resignation, the court invoked its inherent powers under Section 482 of the Cr.P.C. The court relied on Supreme Court precedents to justify quashing proceedings when no offense is disclosed or to prevent abuse of the legal process. Ultimately, the court found it unjust to continue proceedings against the petitioner, given the established timeline of events and her lack of involvement post-resignation. Consequently, the criminal complaint and the related order were quashed, bringing closure to the legal dispute. In conclusion, the judgment exemplifies the judicial scrutiny of directorial liability in corporate offenses under the SEBI Act. It underscores the significance of factual timelines in determining individual culpability and highlights the court's authority to intervene under Section 482 to prevent legal injustice. The detailed analysis provides a nuanced understanding of the legal intricacies involved in the case, ultimately leading to the favorable outcome for the petitioner.
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