1971 (11) TMI 91 - HC - Companies Law

Summary

Issues:
Complaint under section 629 of the Indian Companies Act, 1956 filed by petitioner against respondent. Lower court's order directing complaint to be forwarded to police for investigation under section 156(3), Criminal Procedure Code challenged in revision.

Analysis:
The petitioner filed a complaint under section 629 of the Indian Companies Act, 1956, against the respondent before the lower court. The lower court passed an order directing the complaint to be forwarded to the police for investigation under section 156(3), Criminal Procedure Code. The petitioner, dissatisfied with the lack of progress in the investigation, filed a petition requesting the court to dispose of the complaint in accordance with the law. The lower court, in its order dated January 16, 1970, stated that the complaint had already been forwarded to the police and that it was for the police to register a case and investigate further. The petitioner challenged this order in revision, contending that the lower court's view that the complaint should be investigated by the police after registering a case was erroneous.

The High Court held that an offence under section 629 of the Indian Companies Act is a non-cognizable offence as per section 624 of the Act. Therefore, it cannot be a matter for investigation by the police under section 156(3), Criminal Procedure Code. The court noted that even though the lower court invoked section 155(2), Criminal Procedure Code, for a non-cognizable offence, it still forwarded the complaint to the police under section 156(3). The High Court disagreed with the respondent's argument that the order could be treated as one passed under section 155(2) and emphasized that the lower court should have called for a report from the police on the investigation's result before passing final orders on the complaint.

The High Court set aside the lower court's order and directed it to take the complaint on file and dispose of it in accordance with the law. The High Court deemed the order forwarding the complaint to the police under section 156(3), Criminal Procedure Code, as illegal and ordered the complaint to be called back for proper disposal. The court emphasized that when a statutory complaint is filed, the court must handle it in accordance with the law and cannot simply direct the police to investigate without passing final orders on the complaint itself.