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TMI Blog2012 (3) TMI 202X X X X Extracts X X X X X X X X Extracts X X X X ..... ribed limitation period of three years - whether the directors have resigned or not is a question of fact which cannot be gone into by this court and only the trial court, during trial can decide this issue - the onus of notifying the various agencies about the change of address lied on the petitioners which they have not been able to discharge petitioners cannot shift their liability arising out of their own inaction by stating that there was lack of communication - No illegality in order and petition is dismissed. - CRL. M.C. NO. 371/2011 - - - Dated:- 19-1-2012 - M.L. MEHTA, J. O.P. Gaggar for the Petitioner. Khalid Arshad for the Respondent. ORDER 1. The present petition is preferred by the petitioner under section 482 of the Code of Criminal procedure 1973, for quashing of the complaint lodged by the respondents against the petitioner under section 63 and 628 of the Companies Act, 1956 pending in the Court of Metropolitan Magistrate, Delhi and for quashing of the summoning order dated 13.11.2002. 2. The petitioners were directors of a finance, leasing and investment company named Pariksha Fin-invest-lease Pvt. Ltd having its registered office at B-18, Swam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1956. Section 63 and section 628 of the companies Act,1956 are reproduced as under: 63. Criminal liability for misstatements in prospectus.- (1) Where a prospectus issued after the commencement of this Act includes any untrue statement, every person who authorised the issue of the prospectus shall be punishable with imprisonment for a term which may extend to two years, or with fine which may extend to 1[fifty thousand rupees], or with both, unless he proves either that the statement was immaterial or that he had reasonable ground to believe, and did up to the time of the issue of the prospectus believe, that the statement was true. (2) A person shall not be deemed for the purposes of this section to have authorised the issue of a prospectus by reason only of his having given- (a) the consent required by section 58 to the inclusion therein of a statement purporting to be made by him as an expert, or (b) the consent required by 2[***] sub-section (3) of section 60. 628. Penalty For False Statements. If in any return, report, certificate, balance sheet, prospectus, statement or other document required by or for the purposes of any of the provisions of this Act, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nation now boils down to the question as to when does the limitation period begins. It is a well settled legal proposition that the period of limitation in any offence commences only upon the receipt of knowledge of breach. 10. Shedding light on this issue, this Court in Ajay Jain v. Registrar of Companies NCT of Delhi and Haryana 2010 (119) DRJ 545 has held that the limitation would start only after the filing of the date of balance sheet and not from the date of the issue of prospectus. The relevant part of the judgment reads as under: "5. As far as limitation aspect is concerned, limitation of offences under Sections 63 and 628 of the Companies Act, 1956 starts from the date of knowledge of making a false statement. The Registrar of Companies learnt about making of false statement after filing of balancesheet in the year 1999-2000, therefore, limitation would start only after the date of filing of balance sheet and not from the date of issuing prospectus and this plea, therefore, is not tenable." 11. The point was reiterated in Manjit Jaju v. Registrar of Companies N.C.T. of Delhi and Haryana [2011] 105 SCL 704 (Delhi), "4. The plea taken by the petitioner that the perio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... homas Philip v. Asst. Registrar being Crl. M.C. No. 4113/2002 decided by the High Court of Kerala; Manganese Ore (India) Ltd. v. Municipal Council through its Chief Officer, Uttarwar MANU/MH/0613/2002; and State of Rajasthan v. Sanjay Kumar and Ors. MANU/SC/0335/1998 : (1998) 5 SCC 82. Therefore, at this stage the complaints cannot be thrown out on the ground of limitation and this is the issue which will have to be decided by the trial court after the evidence is led by the parties." 12. Thus from the above pronouncements, it can be gauged that the period of limitation in such offences will begin not from the date of filling of prospectus, as urged by the counsel for petitioner, but from the date of filling the balance sheet on which the complaint has been based. In the present case, the Registrar of Companies came to know about the commission of the offences after the filing of balance sheet by the petitioner for the year 1999- 2001 and the complaint was filed in the year 2002 which is well within the prescribed limitation period of three years. Hence, the question of the period of limitation is answered in favour of the respondents and there is no ground for quashing of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r interference by the High Court. The Hon'ble Supreme Court in the case of Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque [2005]1 SCC 122 held that: "When exercising jurisdiction under Section 482 of the Code, the High Court would not ordinarily embark upon an enquiry whether the evidence in question is reliable or not or whether on a reasonable appreciation of it accusation would not be sustained. That is the function of the trial Judge. Judicial process should not be an instrument of oppression, or, needless harassment. Court should be circumspect and judicious in exercising discretion and should take all relevant facts and circumstances into consideration before issuing process, lest it would be an instrument in the hands of a private complainant to unleash vendetta to harass any person needlessly. At the same time the section is not an instrument handed over to an accused to short-circuit a prosecution and bring about its sudden death." 16. From the facts and circumstances of the case it can be seen that a prima facie case has been made out against the petitioners and there is no reason to interfere with the order of the Ld. M.M. It cannot be said that the Magistra ..... X X X X Extracts X X X X X X X X Extracts X X X X
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