9911796707
TMI Blog2008 (1) TMI 816X X X X Extracts X X X X X X X X Extracts X X X X ..... hange Board of India Act, 1992 ("SEBI Act") filed a complaint being Complaint No. 60 of 2004 on January 14, 2004, against M/s. Swaran Bharat Forests Ltd. ("company") and eight others, including the petitioners herein, who are described in the complaint as directors of the said company. The allegations in the complaint were that the company floated a collective investment scheme but failed to file the requisite information or details pursuant to a Government of India press release dated November 18, 1999. It is stated that the SEBI wrote letters dated December 15, 1999 and December 29, 1999, to the company asking it to submit the information and also send an information memorandum to all the investors giving the detailed status of the scheme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the end of December 2000, the last date for compliance with the direction of the SEBI to the company, the petitioners had ceased to be directors. He points out that the cause for the complaint was the failure of the company to comply with the regulations which themselves came into force only sometime in 1999, and the time for compliance with which was kept extended by the SEBI itself. The certified copies of Form No. 32 filed with the Registrar of Companies intimating the resignation of each of petitioners Nos. 1 and 2 from the directorship of the company in terms of section 303(2) of the Companies Act, 1956, have been placed on record. It is submitted that inasmuch as section 27 of the SEBI Act mandates that "where an offence under this Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e SEBI Act which reads as under : "(1) Where an offence under this Act has been committed by a company, every person who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly : Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence. (2) Notwithstanding anything contained in sub-section (1), where an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucial for determining even the prima facie liability of the individual directors. 8. As far as time of commission of offence is concerned, the complaint itself on a collective reading appears to indicate that according to the SEBI, the offence took place when the company failed to make any application for registration of the collective investment schemes with it in terms of the regulations made under the SEBI Act. Also it appears that the SEBI itself extended the time for compliance even as per its own admission and the deadline in this regard was end of December, 2000. The complaint was filed only in 2004. Therefore, even according to the SEBI any non-compliance with the regulations by the company prior to end of December, 2000 stood cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the trial court, this court does not find it necessary to do so here because certified copies of Form No. 32 have been placed on record and despite sufficient time available to it the SEBI has not brought anything on record to doubt their genuineness. In neither of the other decisions cited, was a similar question concerning Form No. 32 involved. 10. An attempt was made by learned counsel for the SEBI to contend that the offence was a continuing one and took place from the very date that the company was incorporated and in any event from the date the SEBI Act was notified, i.e., April 4, 1992. The court is unable to accept this submission. There is not a whisper of an averment to this effect anywhere in the complaint. The time of commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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