9911796707
TMI Blog2003 (1) TMI 632X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, the Official Liquidator has submitted in this application that they should be punished as per the provisions of section 454(5) of the Act. 2. The learned advocate Shri A.L. Shah appearing for accused No. 8 has submitted that accused No. 8 be discharged as he was not a director of the company at the time when the provisional liquidator was appointed by this court. 3. So as to substantiate his argument he has submitted that February 16, 1999, is the "relevant date" on which the Official Liquidator attached to this Court was appointed as a provisional liquidator of the company. It has been submitted by him that in fact on October 29, 1997, accused No. 8 had submitted his resignation, though because of some typographical mistake, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny Petition No. 152 of 1995, the Official Liquidator had found that accused No. 8 was one of the directors of the company and, therefore, a notice had been issued to accused No. 8 calling upon him to show cause as to why proceedings should not be initiated against him for not filing statement of affairs. It has been submitted by him that it is a normal practice of his office to join all persons as accused who are served with such a notice and, therefore, as per the said practice accused No. 8 has been joined as an accused in the criminal proceedings. 6. I have heard the learned advocate as well as the Official Liquidator. 7. According to the provisions of section 454 of the Act, a statement as to the affairs of the company in the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be punishable with imprisonment for a term which may extend to two years, or with fine which may extend to one hundred rupees, for every day during which the default continues, or with both. (5A) to (7)****** (8) In this section, the expression the relevant date means in a case where a provisional liquidator is appointed the date of his appointment, and in a case where no such appointment is made, the date of the winding up order." 8. Looking to the legal provisions referred to hereinabove it is clear that for the purpose of imposition of punishment under the provisions of section 454(5) of the Act, the accused should have been one of the directors on February 16, 1999, the day on which the Official Liquidator was appointed as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to in the show-cause notice and if the authority issuing the notice is satisfied that the action proposed to be taken against the noticee should not be taken, no action as stipulated in the show-cause notice should be taken or initiated against the noticee. 11. In view of the fact that accused No. 8 had already informed the Official Liquidator about the facts, which have been stated in the statement of defence, in my opinion, the Official Liquidator should not have initiated criminal proceedings against accused No. 8. The practice which the Official Liquidator is following with regard to joining all the concerned persons as accused, does not appear to be proper and, therefore, such a practice must be discontinued. Simply becaus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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