VINOD KUMAR JAIN Vs. REGISTRAR OF COMPANIES

JUDGEMENT

(1.) This is a petition under Section 482, Code of Criminal Procedure (for short 'the Code') for quashing the proceedings in a company case pending in the court of an Additional Chief Metropolitan Magistrate, Delhi, under Section 229(4) read with Sections 299(1) & 299(2) of .the Companies Act, 1956 (hereinafter referred to as 'the Act') initiated on the complaint of the respondent-Registrar of Companies, Delhi & Haryana.

(2.) The facts leading to this petition succinctly are that the petitioner- Vinod Kumar Jain was Managing Director of M/s. Jain Shudh Vanaspati Ltd., New Delhi (hereinafter referred to as 'the Company') at the relevant time. On 29th August 1980 the Board of Directors of the Company passed a resolution in which a draft of the lease agreement regarding lease of 50% share of the 7th Floor of a building called 'ARCADIA' situated at Nariman Point, Bombay, between the petitioner and his wife Smt. Anju Jain as lessors and the Company as lessee was approved. Pursuant to the said resolution of the Board the lease deed as approved was executed by Shri S.K. Jain, a director of the Company on behalf of the Company and the petitioner and his wife Smt Anju Jain on 15th September 1980 (annexure 1' being copy of the lease deed). On 19th September 1984 the respondent instituted a complaint against the petitioner under Section 299(4) of the Act read with Sub-sections (1) & (2) thereof on the allegation that the inspection of the books of accounts ana other records of the Company was made by Shri O. P. Chadha, Deputy Director (Inspection) under Section 209A of the Act sometime in December 1980. During the course of inspection of the books of accounts and minutes books of the Board it transpired that the petitioners had not disclosed his interest in the contract of lease regardihg the aforesaid property entered into by him and his wife with the Company. The said fact came to the notice of the respondent-complainant only on 24th January 1981 when a copy of the inspection report dated 17th January 1981 was submitted by Shri 0.P. Chadha to the Department, Finding that the petitioner being Managing Director of the Company was legally bound under the statutory provisions of Section 299 (1) of the Act to disclose his interest in the aforesaid lease but he had not done so and had thus contravened the aforesaid statutory provision, necessary sanction/instruction from the Govt. of India was obtained to institute a complaint against the petitioner on 17th July 1984 and thereafter the said complaint was lodged.

(3.) The learned Magistrate passed the following order summoning the petitioner on the very day the complaint was instituted by the respondent :