REGIONAL DIRECTOR SOUTHERN REGION MINISTRY OF COMPANY AFFAIRS GOVT OF INDIA SHASTRI BHAVAN VTH FLOOR 26 HADDOWS ROAD CHENNAI Vs. CONCERT SECURITIES LTD

JUDGEMENT

(1.) APPELLANT is the complainant in C.C. 58 of 2003 on the file of the Additional Chief Judicial Magistrate (Economic Offences), Ernakulam. The appellant prosecuted the respondents alleging offence under Section 58A of the Companies Act with a plea that the first respondent is a company registered under the Indian Companies Act and that the other respondents are the directors of the company and that during an inspection conducted under Section 209 (a) of the Companies Act, it was revealed that the respondents had obtained unsecured loans, which are deemed deposits, amounting to Rs. 11 lakhs from seven different persons. Ext.P10 is the copy of the inspection report. Show cause notice was issued to which Ext.P11 explanation was given. In Ext.P11, practically, the availing of the loan is admitted. But the case of the respondents is that to meet some urgent necessity, loan was availed and it was duly discharged. Not being satisfied with the explanation, prosecution was launched with due sanction.

(2.) THE respondents entered appearance and pleaded not guilty. THErefore, they were sent for trial. On the side of the prosecution PWs 1 and 2 were examined. Exts.P1 to P14 were marked. Respondents repeated the defence when questioned under Section 313 of the Code of Criminal Procedure. However, no defence evidence was let in. THE learned magistrate, on appraisal of the evidence, arrived at a conclusion that the respondents had availed loan and it was discharged. Consequently, the respondents were acquitted as if the availing of loan and discharging would not amount to deposit as contemplated under Section 58A of the Companies Act. Now this appeal.