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TMI Blog1973 (8) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... ld it be so laid. The Full Bench speaking through Jaganmohan Reddy C.J., as our learned brother then was, held that if no balance-sheet is laid before a general body, there can be no question of that balance-sheet not being adopted nor of complying with the requirements of section 220 and though wilful omission to call a general body meeting and to lay the balance-sheet and profit and loss account before it may expose the person responsible to punishment under other provisions of the Act, it certainly does not make him liable under the provisions of section 134(2) of the Companies Act, 1913, or section 220 of the Companies Act, 1956. In this the Bench was taking a view contrary to that of most of the High Courts after the decision of this court in State of Bombay v. Bandhan Rain Bhandani [1961] 31 Comp Cas. 1 ; [1961] 1 S.C.R. 801 ; A.I.R. 1961 S.C. 186 . In that case this court had taken the view that a person charged with an offence cannot rely on his default as an answer to the charge and so, if he was responsible for not calling the general meeting, he cannot be heard to say in defence to the charges brought against him that because the general meeting had not been called, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 220 of the 1956 Act), the company and its directors could not rely upon their failure to call the general body meeting as a defence to the prosecution. Under this category fall the decisions in Dulal Chandra Bhar v. Slate of West Bengal [1962] 32 Comp. Cas. 1143 (Cal.) and Gopal Khailan v. State [1969] 39 Comp Cas. 150 ; A. I. R. 1969 Cal. 132 of the Calcutta High Court, Ramchandra & Sons (Private) Ltd. v. State [1966] 36 Comp. Cas. 585 (All.) of the Allahabad High Court, State v. Tank Calico Printers (P.) Ltd. A.I.R. 1963 Raj. 134 of the Rajasthan High Court, India Nutriments Ltd. v. Registrar of Companies [1964] 34 Comp. Cas. 1 60 (Mad.) and P. S. N. S. Ambalavana Chettiar & Company v. Registrar of Companies [1966] 36 Comp. Cas. 58 ; A.I.R. 1966.Mad. 415 of the Madras High Court. The Orissa High Court had taken a similar view in Registrar of Companies v. Hari-bansha Misra [1969] 39 Comp. Cas. 990 ; A.I.R. 1969 Orissa 234 but in a later decision in Vulcan Industries ( Pvt.) Ltd. v. Registrar of Companies [1972J 42 Comp. Cas. 326 ; I.L.R. 1972 Orissa 373, it has taken a contrary view and followed the decision of the Andhra Pradesh High Court in the judgment under appeal. Tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y meeting is held, it is obvious that no copies of the balance- sheet and profit and loss account can be filed even though the default may be willful. Both under section 134 of the old Companies Act and section 220 of the Act, the laying of the balance-sheet and the profit and loss account before an annual general meeting is a condition precedent to the require ment that copies of such documents so laid should be filed before the Registrar. This intention is made further clear by the provisions under sub-section (2) of the respective sections of both the Acts that, if the balance-sheet is not adopted at the general meeting before which it is laid, a statement of the fact and of the reasons therefore have to be annexed to the balance-sheet and to the copies thereof required to be filed with the Registrar. If no balance-sheet is laid before a general body, there can be no question of that balance-sheet not being adopted nor of complying with the requirements of sub-section (2) of section 134 of the old Companies Act or section 220 of the Act, as the case may be, while willful omission to call a general body meeting or omission to lay the balance-sheet and profit and loss account befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l as a summary and also provides that it shall be completed within 21 days after the day of the first or only ordinary general meeting in the year. It also provides that the company shall forthwith file with the Registrar a copy of the list and summary and any default in complying with the requirements of the section is made punishable. Under section 131 the laying of a balance-sheet and profit and loss account before the company in the general meeting is made obligatory. Under section 133 the failure to comply with section 131 is made punishable. But section 134 lays down that after the balance-sheet and profit and loss account or the income and expenditure account, as the case may be, have been laid before the company at the general meeting three copies thereof shall be filed with the Registrar, and a failure to do so is made punishable under sub-section (4) of that section. The difference in language is very clear and pointed. The responsibility of sending three copies of the balance-sheet and profit and loss account or the income and expenditure account, as the case may be, arises only after they have been laid before the company at the general meeting. Without so laying, copie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter". This observation may provide no defence to a prosecution under section 133 but it might well do so in a prosecution under section 134. This was what the learned Solicitor-General was fair enough to point out with regard to the difficulty of working out the daily penalty under section 162 after the thirtieth day mentioned in section 220(1) of the 1956 Act. He pointed out that where no meeting has been held it was not possible to calculate the period of 30 days specified in that section and it would not be possible to give effect to the provisions of that section. The Bombay High Court pointed out in Emperor's case (supra) that the decision in Park's case (supra ) is based on section 36 (it is a mistake for section 26 of the English Act), which in its scheme and terms is entirely different from the section with which they (the Bombay High Court) were concerned, and that the section in the English Act is a composite one which lays down various requirements which are to be complied with by the company under its first four sub-clauses and sub-clause (5) is the penal subsection which penalises the failure to comply with any of the requirements contained in any of the four precedin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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