ANANTHA R HEGDE Vs. GOPALAKRISHNA

JUDGEMENT

(1.) The petitioners are shareholders/members of the Bangalore Stock Exchange Limited (hereinafter referred to as 'the Stock Exchange'), the premier Stock Exchange of Karnataka. The Board of Directors of the Stock Exchange which is known as Council of Management consists of 13 Directors, six Directors elected by the members of the Bangalore Stock Exchange, three Directors are public representatives and three are nominated by the Securities Exchange Board of India, which is a Government of India organisation. The respondent herein was a Director of the Stock Exchange. Due to various misdeeds committed by the respondent, he was removed from the Directorship of the Stock Exchange by over-whelming majority of the members of the Stock Exchange of the annual general meeting held on 19-11-1994. Ever since then, it is alleged that he has been filing false and frivolous suits, writ petitions criminal complaints, against the Stock Exchange and he is trying to destroy the Stock Exchange, its Directors as well as its members. It is further alleged by the petitioners that the respondent herein in furtherance of his evil designs to destroy the Stock Exchange, coerced some of the members into signing a notice calling for Extraordinary General Meeting of the Stock Exchange for removal of the President and Treasurer of the Stock Exchange. Thereafter, some of the members realising that it is not in the interest of the Stock Exchange as well as its members, to requisition any such Extraordinary General Meeting, withdrew the requisition. The notice given by the requisitionist was considered by the Board of the Stock Exchange, but by that time the number of members supporting the requisition had fallen short of the mandatory requirement of Section 169 of the Companies Act, 1956, (hereinafter referred to as 'the Act'). In view of the same, the Board of Directors of the Stock Exchange refused to call the Extraordinary General Meeting, in respect of which the respondent along with a few of his men, convened the Extraordinary General Meeting of the Stock Exchange illegally. In view of the same, some of the petitioners filed original suits before the City Civil Court, Bangalore for declaration that the notice convening the Extraordinary General Meeting on 8-4-1995 is illegal and for other reliefs. The said suits are pending consideration.

(2.) The petitioners further submit that the respondent here in with the sole intention of harassing the petitioners has filed private complaints in the Court of Economic Offences, Bangalore, under Section 200 of the Cr.P.C. The respondent was examined by the learned Magistrate and his sworn statement was recorded. The learned Magistrate took cognizance under Section 169 of the Act and directed issue of summons to the petitioners. The allegations made in the complaints are false and frivolous in nature and is in abuse of the process of Court. According to them, the complaints were filed with the sole intention of harassing the petitioners herein. Those cpmplaints came to be filed only on the statements made by the petitioners in the complaints and also affidavits filed in support of the I.As. The suits are pending consideration before the City Civil Court, Bangalore. According to the respondent, the statements made therein are false and are made with an oblique motive and therefore, the respondent claims that the petitioners have committed offences under Section 629 of the Act on giving false evidence in the plaints and affidavits of the suits referred to above. Therefore, the petitioners approached this Court under Section 482, Cr.P.C. to quash the entire proceedings pending before the Economic Offences Court of Bangalore.

(3.) With this prelude it is now necessary to refer to the specific criminal petitions filed before this Court. Criminal Petition No.2554 of 1995 is filed to quash the entire proceedings in P.C. No. 494 of 1995 which is pending in C.C. No. 1459 of 1995. C.C. No. 1459 came to be filed by the respondent against Anantha R. Hegde on the allegation that he has filed Original Suit No. 10348 of 1995 on the file of the City Civil Judge, Bangalore, for declaration that notice convening the Extraordinary General Meeting of the Stock Exchange by the defendants 1 to 9 on 8-4-1995 is illegal, invalid and void and also for consequential relief of injunction, etc. In that complaint, the complainant has specifically stated that the plaintiff therein made false statements to the effect that due to various misdeeds committed by him the members of the Stock Exchange removed him from the office of the Directors of the Stock Exchange. He is trying to destroy the Stock Exchange by various methods. He has failed to abide by the decision of the Council of Management. The 1st defendant in furtherance of his design to destroy the Stock Exchange has coerced and forced some of the members to sign the notice for passing an Extraordinary General Meeting. The defendant in furtherance of his evil designs to destroy the Stock Exchange has coerced and forced some of the members to sign a notice to call the Extraordinary General Meeting. Certain members whose signatures were obtained by coercion or misrepresentation withdrew. The Registrar of Companies who is the Administrative Authority on the administration of the Company Law in the State of Karnataka came to the definite conclusion that there is no valid requisition under law. Though the requisition initially contained 15 signatures, admittedly certain signatures were obtained under force or misrepresentation were withdrawn. The defendants 3, 4, 5 and 7 were suspended from the Stock Exchange for a limited period on account of their not filing their audited accounts with the Stock Exchange as required under the Rules of the Stock Exchange. According to the defendants, these allegations made in the complaint are false and he has misrepresented the Court with an intention to obtain an order of injunction, thereby he has committed an offence punishable under Section 629 of the Act. As against the order passed by the learned Magistrate, taking cognizance of the case, the accused/petitioner filed Criminal Petition No. 2554 of 1995.