2023 (5) TMI 203 - HC - Companies Law

Offence under Companies Act, 2013 - Jurisdiction - cognizance was taken by the Special Court and summons were issued -Erroneous allegations of giving false evidence before National Company Law Tribunal, Indore Bench under Section 193, 196, 120-B/34 of IPC and under Section 449 of the Companies Act, 2013 - submission of false information before the National Company Law Tribunal, Indore Bench - HELD THAT - From bare reading of Section 435 of the Companies Act, it is evident that for the purpose of providing speedy trial of the offences under the Companies Act, the Central Government by notification may establish or designate as many special Courts as necessary and in that context IX Additional District and Sessions Judge, Gwalior has been designated as Special Court under the Companies Act vide notification dated 18.05.2016 issued by Industry and Corporate Forum. Section 436 of the Companies Act starts with a non obstante clause Notwithstanding anything contained in the Code of Criminal Procedure which gives an overrding effect over the provisions of Act mention in the non obstante clause. It is trite to say that accept of provisions or act mentioned in the non-obstante clause, the enactment following it will have its full operation or that the provisions embrazed in the non-obstante clause will not be an impediment for the operation of the enactment, thus, a non-obstante clause may be used as a legislative device to modify the ambit of the provision of law mentioned in the non-obstante clause or override it in specified circumstances. Therefore, when the enacting part of the Section is clear, its scope cannot be cut down or enlarged by resort of non-obstante clause. Thus, it could safely be held that the provisions of Section 436 of the Companies Act will have over riding effect over the provisons of Code of Criminal Procedure, whenever an offence specified under the Companies Act is to be tried by Special Court. Admittedly, Section 449 which deals with punishment for giving false evidence is an offence under the Companies Act, it is to be tried by Special Courts established/notified by the Central Government as per Section 435 of the Companies Act. Maintainability of the complaint at the behest of complainant/respondent - HELD THAT - Section 439 (2) of the Companies Act is very much clear. Section 449(2) lays down about the exception for the Courts taking cognizance upon complaint in writing made by the Registrar, a share holder or a member of the Company or a person authorized by the Central Government in that behalf. Thus, it is clear that any of the person mention in the Section can maintain the complaint and the complainant/respondent being one of the Directors (shareholders/members) of the accused/petitioner company could maintain the complaint. The petitioner is partly allowed and disposed of.

Issues Involved:
1. Legality of cognizance taken by IX Additional District and Sessions Judge, Gwalior.
2. Jurisdiction of the Sessions Court in taking cognizance.
3. Applicability of Section 195 of Cr.P.C. in the context of false evidence.
4. Compliance with mandatory provisions under Section 340 of Cr.P.C.
5. Procedure under Section 449 of the Companies Act, 2013.
6. Judicial application of mind by the Special Judge.

Summary:

1. Legality of Cognizance:
The petitioners challenged the order for issuance of summons dated 27.08.2022 by IX Additional District and Sessions Judge, Gwalior, arguing that the complaint under Sections 193, 196, 120-B/34 of IPC read with Section 449 of the Companies Act, 2013, was filed based on erroneous allegations of giving false evidence before the National Company Law Tribunal, Indore Bench.

2. Jurisdiction of the Sessions Court:
Petitioners contended that under Section 195 of Cr.P.C., only the Court or Tribunal where false evidence was allegedly given could file a complaint. They argued that the Sessions Court lacked jurisdiction to take cognizance of a complaint filed by a private person.

3. Applicability of Section 195 of Cr.P.C.:
Petitioners argued that Section 195 of Cr.P.C. bars any Court from taking cognizance of offences related to giving false evidence unless the complaint is made by the Court or Tribunal where the false evidence was tendered. Hence, the cognizance taken by the Sessions Judge was unjustified.

4. Compliance with Mandatory Provisions:
Petitioners emphasized that Section 340 of Cr.P.C. prescribes a special procedure for offences related to giving false evidence, which must be followed by the concerned Court or Tribunal before filing any complaint under Section 195 of Cr.P.C. They argued that the National Company Law Tribunal, Indore Bench, should have followed this procedure.

5. Procedure under Section 449 of the Companies Act, 2013:
Respondent's counsel argued that the complaint under Section 449 of the Companies Act, 2013, was maintainable as it was filed by a shareholder/member of the company, as specified under Section 439(2) of the Companies Act. The Special Courts established under Section 435 of the Companies Act have jurisdiction over such offences.

6. Judicial Application of Mind:
The Court observed that the IX Additional District and Sessions Judge, Gwalior, did not apply its judicial mind while taking cognizance and issuing summons. The Special Judge should have provided proper reasons for taking cognizance, as mere stating that appropriate grounds exist is insufficient.

Conclusion:
The Court set aside the order dated 27.08.2022 and directed the Special Judge to pass a reasoned order afresh while taking cognizance. The petition was partly allowed and disposed of with these observations and directions.

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