GIRDHARI LAL Vs. GOBIND RAM

JUDGEMENT

(1.) The only question that arises in this petition and other petitions which are being disposed of by this order is if the offences under Sec. 159 read with Sec. 162 and Sec. 220 again read with Sec. 162 of the Companies Act 1956 (for short 'the Act') are continuing offences within the meaning of Sec. 472 of the Code of Criminal Procedure 1973 (for short 'the Code') so as to remove the bar of limitation to take cognizance of the offences as provided by Sec. 468 of the Code. Under sub's. (1) of Sec. 468 of the Code, a court cannot take cognizance of an offence after the expiry of the period of limitation as provided under sub-s. (2) of that section. In the case where the offence is punishable with fine only, the period of limitation prescribed is six months. Sec. 472 of the Code provides however, that in the case of a continuing offence, a fresh period of limitation shall begin to run at every moment of the time during which the offence continues. Sec. 159 of the Act provides for filing of annual returns by the company and fixes the time by which the annual return is to be filed with the Registrar of Companies. The return is to be in the form prescribed and is to contain various particulars as mentioned in the section. Sub-s. (1) of S. 220 of the Act provides for filing of balance-sheet and the profit and loss account with the Registrar of Companies. These documents are to be filed within thirty days from the date on which the balance-sheet and the profit and loss account were laid at the annual general meeting of the company. Where, however, the annual general meeting of a company for any year has not been held then also copies of the balance-sheet and profit and loss account duly signed as provided are to be filed with the Registrar of Companies within thirty days from the latest day on or before which the annual general meeting should have been held. This latter requirement was added by the Companies (Amendment) Act 1977. Under sub-s. (3) of Sec. 220 of the Act, so far as is relevant in the present case, if a default is made in complying with the requirements of sub-s. (1) of Sec. 220, the company and every officer of the company who is in default shall be liable to punishment as provided by S. 162 which is same as for default in complying with the provisions of Sec. 159 as well. Sec. 162 of the Act may now be set out as under : -

(2.) It was contended by Mr. C.L. Behl, learned counsel for the petitioners, that offence under Sec. 162 of the Act for contravening the provisions of Sees. 159 and 220 of the Act could not be said to be a continuing offence.He said there were certain sections in the Act which providedfor punishment in the case of continuing offences. In this connection, Mr. Behl referred to Secs. 168, 234 and 598 of the Act Sec. 168 levies penalty for default in holding a meeting of the company in accordance with Sec. 166 or in complying with any directions of the Central Government under sub-s. (1) of Sec. 167 of the Act and the company and every officer of the company who is in default is punishable with fine which may extend to Rs. 5000.00 and in the case of a continuing default, with a further fine which may extend to two hundred and fifty rupees for everyday after the first during which such continues (Italic portion inserted by Companies (Amendment) Act 1960). Sub-s. (4) of Sec. 234 of the Act provides tor punishment in case of default in complying with the provisinos of sub-secs. (2)(3) or (3A) of the section and the company and the officers concerned shall be punishable with fine which may extend to Rs. 500.00 and in the case of a continuing offence, with an additional fine which may extend to Rs. 50.00 for every day after the first during which the offence continues and the court at the same time is also empowered on the application of the Registrar to give certain directions to the company. Under Sec. 598 of the Act, if a foreign company fails to comply with the provisions of Part XI of the Act, then the company and every officer or agent of the company in default is liable to be punished with fine which may extend to Rs. 1000.00 and in the case of a continuing offence, with an additional fine which may extend to Rs. 100..00 for every day during which the default continues. Thus, according to Mr. Behl, the use of the words 'continuing default' and 'continuing offence' made all the difference which words were not used in Sec. 162. Mr. Behl also submitted with reference to Sec. 614A of the Act that the offence under Sec. 162 could not be a continuing offence. Under this section, a court when trying an offence for a default in compliance with the provisions of the Act, could direct any officer or other employee of the company to file with the Registrar of Companies statements as required by Sees. 159 and 220 of the Act. Mr. Behl also said there were other provisions in the Act under which a company could be required to comply with the provisions of Sees. 159 and 220 of the Act and in this connection he referred to Sees. 614 and 615 of the Act. Mr. Behl also said that whenever the legislature wanted the offence to be continuous it always provided for higher punishment for the subsequent offence. According to Mr. Behl, therefore, the words continuous offence and subsequent offence were synonymous and there was always a severe punishment for a subsequent offence. In support of his submissions, Mr. Behl relied upon a Bench decision of the Calcutta High Court in National Cotton Mills v. Asstt. Registrar of Companies (( 1984) 56 Comp. Cas. 222).

(3.) Mr. M.S. Gandhi who also appeared for some of the petitioners, supported Mr. Behl in his submissions and submitted that infliction of. fine on day-to-day basis did not make the offence continuous.