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TMI Blog2022 (6) TMI 504X X X X Extracts X X X X X X X X Extracts X X X X ..... hese facts within the stipulated period. It is seen that PW1 merely filed the complaint and nothing more. It is also seen that the show cause notice, its reply, whether it was considered or not, nothing is available in the complaint, which is improper. Had the petitioner referred to Shri Venkatachalapathy as Lord Venkatachalapathy, the above issue would not arise. The petitioner had filled up and signed the application form, paid for the shares in the first name of Shri Venkatachalapathy and the second name for himself and the address given is that of the petitioner, which clearly discloses that there is no other intention for the petitioner to commit any impersonation for acquisition and no intention for the petitioner to acquire shares in fictitious name. Hence, there is no evasion or enrichment. The petitioner ought not to be prosecuted for offence under Section 68A of the Act. The petitioner ought to have filed the declaration under Section 187C of the Act within the prescribed period. For non filing of declaration, only penalty can be imposed and nothing more. As per Section 55A of the Act, the SEBI authorities would be a right authority to initiate prosecution for offen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y is given as 110, Ramakrishna Mutt Road, Chennai, which is the address of the petitioner, the Managing Director of the company. During inspection, it was also found that the dividends in respect of the shares held in the name of Shri Venkatachalapathy, which are as follows:- Years Dividend Paid 2000-2001 Rs.29,945/- 2001-2002 Rs.64,779/- 2003-2004 Rs.41,223/- and 2004-2005 Rs.65,005/- Total Rs.2,00,952/- 4. Hence, it was found that there is no such person by name Shri Venkatachalapathy and the above shares are held only by the petitioner, Managing Director of the company. It was also noticed during inspection that no return as required under Section 187C of the Act has been filed to the respondent. Therefore, the company has violated the provisions of Section 68A of the Act as 1,76,670 shares are held in fictitious name. 5. Based on the inspection report, the Regional Director, Ministry of Corporate Affairs sen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tic entities and Shri Venkatachalapathy is the deity worshipped by the petitioner. The shares were held in the name of Shri Venkatachalapathy and in the name of the petitioner. In this case, the evidence of PW1 is that he launched the prosecution based on the inspection carried out by PW2, the Inspecting Officer. PW1 stated that he collected the documents alone from PW2 and he was not conversant with the documents and the facts of the case. PW2 admitted that he not called for the share certificate for examination. The learned counsel further submitted that merely because the address of Shri Venkatachalapathy and the petitioner are one and same, the respondent wrongly concluded that Shri Venkatachalapathy was a fictitious person. It is also not in dispute that the payments for the shares were made by the petitioner. PW2 admitted that he has not served the copy of the inspection report to the petitioner, which is the foundational basis for launching the prosecution. PW2 admitted that in the name of God, an account can be opened and maintained and there is no legal bar to purchase the shares jointly in the name of the god and in the name of a person. Once such admission is made, the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the properties can be purchased. He further placed reliance on the decision of the Delhi High Court in the case of Kimsuk Krishna Sinha Versus Securities of Exchange Board of India Ors. and decision of the Hon'ble Apex Court in the case of Sahara India Real Estate Corporation Limited and others Versus Securities and Exchange Board of India and another reported in (2013) 1 SCC for the preposition that as per Section 55A of the Act, the prosecution to be launched only by SEBI for any violation of Section 68A of the Act. 11. Mr. B. Sudhir Kumar, Central Government Standing Counsel appearing for the respondent submitted that the Inspecting Officer/PW2 inspected the company under Section 209A of the Act. During the course of the inspection of the records of the company, it was found that 1,76,670 shares of the company were in the name of the Shri Venkatachalapathy and the address given is that of the petitioner, the Managing Director of the company. Hence, it was confirmed that no person in the name of Venkatachalapathy and the petitioner impersonated in the name of Shri Venkatachalapathy and thereby, violated the provisions of Section 68A of the Act. He further submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner herein are answered by the Court below, hence, he prayed for dismissal of the Criminal Revision. 13. This Court considered the rival submissions and perused the materials available on record. 14. The primary contention of the petitioner is that in reverence, the petitioner was holding the shares along with Shri Venkatachalapathy. He is an harden devotee of Lord Venkatachalapathy. It is an acceptable norm that the properties purchased in the name of God for sentimental reasons. DW1, the Secretary of the company in his evidence stated that the shares have been held jointly in the name of Lord Venkatachalapathy and in the name of the petitioner. This has not been disputed by way of cross examination by the respondent. The entire case rest on the inspection conducted under Section 209A of the Act by PW2 during the period from 04.05.2006 to 13.06.2006. It is admitted by PW2 that he only sent a letter/Ex. P4 after the inspection. He further admitted that in the name of the God, an account can be opened maintained, shares can be purchased and there is no legal bar to purchase the share jointly in the name of God and in the name of a person. PW2 further admitted that he w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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