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TMI Blog2007 (12) TMI 285X X X X Extracts X X X X X X X X Extracts X X X X ..... .V.S. RAO, J. M. Anil Kumar for the Appellant. C. Kodanda Ram and M.S. Ramachandra Rao for the Respondent. ORDER 1. This application is filed under section 454(5) and (5A) of Companies Act, 1956 (the Act, for brevity) praying this Court to take cognizance of the offence committed by Accused Nos. 1 to 4 under section 454(5) of the Act and to summon the accused for being tried and punish in accordance with sub-sections (5) and (5A) of section 454 of the Act for having wilfully and deliberately not complied with the requirements under sub-sections (1), (2) and (3) of section 454 of the Act. 2. M/s. Global Drugs Private Limited was directed to be wound up by this Court by order dated 5-4-2005 made in RCC No. 1 of 2004. The Official Liquidator (OL) attached to this Court was appointed as Liquidator in terms of section 449 of the Act. He filed affidavit in support of the application herein. It is stated that as per the information gathered from the Registrar of Companies (RoC), Hyderabad, accused are Officers/Directors of the company on the date of order of winding up, that Accused Nos. 1 and 2 are on the Board since the date of incorporation dated 12-10-1988 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Company Court was obtained to issue Ex. A.4 notice calling upon Accused Nos. 3 and 4 to file SoA but she stated that complaint was filed after obtaining Form No. 32 from the RoC. She was confronted with Ex. B1 Annual Report for the year 2002, according to which only Accused Nos. 1, 2 and 4 and one Vara Prasad are Directors. Ex. B.1 also shows that Accused No. 4 was appointed as nominee Director on 21-8-1997 and as per Ex. B.2 Annual Return for the year 2001-2002, Accused No. 4 resigned as Director during that year. PW1 was also confronted with Ex. B.3 Form No. 32 issued by RoC. She also deposed that they did not produce any record to show that Accused No. 3 was in custody of books of account and that Accused No. 3 has reasonable excuse for not filing SoA. It was also admitted that Ex. A.4 notice was not served on Accused Nos. 3 and 4. 6. The case of prosecution rests on Ex. A.2 Annual Return for the year 1999. According to this, Accused Nos. 3 and 4 are shown as Directors. The former was appointed on 3-11-1992 and the latter was appointed on 21-8-1997. Ex. A.3 is Form No. 32 dated 22-9-1998 and obviously it does not contain the names of Accused Nos. 3 and 4 in column No. 1 th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w that accused No. 3 ceased to be Director with effect from 31-3-2001 and that Accused No. 4 ceased to be Director with effect from 1-8-2001, therefore they are not Directors/Managers, etc., as on relevant date, liable to file SoA within 21 days from the date of winding up order. ( ii ) Whether Accused Nos. 3 and 4 are or have been officers of company - Sub-section (30) of section 2 of the Act defines officer includes any director, manager or secretary or any person in accordance with whose directions or instructions the Board of directors or any one or more of the directors is or are accustomed to act. Accused No. 3 joined Board of Directors of the company on 3-11-1992 and Accused No. 4 joined on 21-11-1997. Whether the Board of directors of the company was accustomed to act as per their instructions? There is no averment either in the affidavit accompanying the complaint or in the statement of PW 1 to show that Board of Directors were acting under the dictates of Accused Nos. 3 and 4. Hence, Accused Nos. 3 and 4 do not fall under category of officer of company in liquidation. ( iii ) Whether Accused Nos. 3 and 4 took part in formation of company or employees of company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is a direction of the court or when the official liquidator issues notice requiring them to submit and verify the statement. I am also of the view that the time-limit specified in sub-section (3) can have application only to the officers of the company falling under the first category mentioned above, i.e., those who are directors of the company on the relevant date and the manager, secretary or other chief officer of the company on the relevant date, because their obligation to submit and verify the statement springs into existence from the relevant date and does not depend upon any direction of the Court or notice from the official liquidator. . . ." [Emphasis supplied] (p. 677) The above view was reiterated in Sunrise Oleo Chemicals Ltd. v. M.U.S. Rao 2004 (4) ALD 657. 9. In this case there is no dispute that after advertising/publishing winding up order OL issued Ex. A.4 notice to the accused. A perusal of Ex. A.4 notice would show that though it is described as, notice to submit SoA under section 454 of the Act , curiously it is a show-cause notice sent to all the accused including Accused Nos. 3 and 4 calling upon them to explain within seven days from the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iranjan Jayantilal Tolia [1984] 56 Comp. Cas. 380 , wherein it was held as below : ". . . .The expression reasonable excuse means an excuse which a reasonable person considers just and acceptable in the circumstances of the case, that is, which appeals to the reason of a reasonable man. In other words, the excuse must be such as may appear to be probable in the facts and circumstances of the case to a prudent, and not to a gullible person. The evidence on record clearly shows that he did not attend any of the board meetings after 28-3-1974. That was his stand from the very beginning as is evidenced from the telegram sent immediately on receipt of notice under rule 124 of the Rules. The statement of affairs of the company has to be filed in the prescribed Form No. 57. A bare perusal of the form shows that only a person having intimate knowledge about the affairs of the company would be able to furnish the host of information required thereunder. It is true that the accused could have inspected and did inspect the account books of the company but a mere perusal of the accounts would not enable him to supply the particulars demanded thereunder. I am, therefore, of the opinion th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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