1965 (8) TMI 53 - HC - Companies Law

Annual return - General, Annual Return Penalty for not filing, Duty of officer to make disclosure of payment, etc.

Summary

Issues: Jurisdiction of the Presidency Magistrate to try the case, applicability of sections 159 and 221 of the Companies Act, relevance of company's defunct status in defense, comparison with the earlier Companies Act, and the quantum of fine imposed.

Jurisdiction of the Presidency Magistrate: The petitioners argued that the offences were committed in Tiruchi district, where the company's head office is located, not in Madras City, where the Registrar of Companies is situated. However, the court held that as per sections 159 and 221 of the Companies Act, the offences were committed in Madras City since the filings were required to be made before the Registrar in Madras City, establishing the Presidency Magistrate's jurisdiction to try the case.

Applicability of Sections 159 and 221: The court referred to a decision of the Calcutta High Court under the earlier Companies Act, emphasizing that failure to file required documents with the Registrar's office constituted an offence, regardless of the company's defunct status or inability to convene meetings. The court affirmed that the petitioners' failure to file the necessary documents amounted to a violation of the Companies Act.

Relevance of Company's Defunct Status: The petitioners contended that the company had become defunct, but the court noted that as long as the company remained on the register without any steps taken for dissolution, the obligation to comply with statutory requirements persisted, rejecting the defunct status as a defense.

Comparison with the Earlier Companies Act: The court highlighted that certain provisions of the earlier Companies Act regarding jurisdiction had been deleted in the new Act. However, it clarified that general provisions of the Criminal Procedure Code, including sections 182 and 531, continued to apply, ensuring the validity of prosecutions under the Act.

Quantum of Fine Imposed: While confirming the petitioners' convictions, the court found the fines imposed excessive, especially considering the death of the principal accused. Consequently, the court reduced the fine to Rs. 40 for each accused in each case, with a default option of one month's simple imprisonment, ultimately dismissing the revisions with the modified fine amount.

Conclusion: The court upheld the convictions of the petitioners for non-compliance with statutory filing requirements under the Companies Act, emphasizing the Registrar's jurisdiction in Madras City. The judgment stressed the ongoing obligations of companies, regardless of their operational status, and clarified the applicability of relevant provisions from the earlier Companies Act and the Criminal Procedure Code. The court adjusted the fines due to the principal accused's demise, providing a three-month window for payment.