KHUSHI EXPORTS P LTD Vs. STATE OF GUJARAT

JUDGEMENT

(1.) By invoking the jurisdiction of this Court under Sec. 482 of Cr.P.C., the present petition is filed by the petitioners for quashing and setting aside the proceedings of Criminal Case No. 207 of 2003 pending in the Court of learned Addl. Chief Metropolitan Magistrate, Ahmedabad.

(2.) This matter was listed before this Court on earlier occasions and on 13-10-2004, learned Sr. Counsel Mr. S. N. Soparkar appeared for the petitioners and had taken this Court through relevant aspects and learned Addl. Central Government Standing Counsel Ms. Davawala had placed the version of the department as reflected in the affidavit and the documents attached in support of the affidavit i.e. page Nos. 47 to 59. When matter was listed on 25-10- 2004, it was pointed out that now Ms. Davawala is not appearing on behalf of Central Government and so in the interest of justice, matter was adjourned and Registry was directed to list the matter for final disposal today.

(3.) It has been submitted by the petitioners that as the complainant-respondent No. 2 has failed in withdrawing the criminal proceedings initiated against the petitioners and in dropping the same in view of settled legal provisions and General Circular No. 13 of 2003 dated 25-3-2003, the proceedings of Cri. Case No. 207 of 2003 pending in the Court of learned Addl. Chief Metropolitan Magistrate, Ahmedabad filed by respondent No. 2-original complainant be quashed. The say of the petitioners is that the petitioner No. 1 as Private Ltd. Company, submitted one application under Sec. 560 of the Companies Act, 1956 (hereinafter referred to as 'the Act') on 26-3-2002 to respondent No. 2 requesting respondent No. 2 to strike off the name of the company from the register of Registrar of Companies. There was an amendment in the Companies Act, 1956 by inserting Secs. 3(3) and 3(5) requiring the private limited companies to increase the paid-up capital atleast Rs. 1 lakh by 13-12-2002 failing which the Company shall be deemed to be defunct within the meaning of Sec. 560 and its name shall be struck off from the register by the Registrar. Since, the petitioners have filed an application under Sec. 560 of the Act to respondent No. 2 to strike off the name, the petitioner No. 1-Company did not raise the paid-up capital. However, on the allegation that the petitioner-Company has not increased paid-up capital, criminal proceedings came to be launched against the petitioners. According to the petitioners, when the decision has been taken to struck off (sic.) the name of the Company from the register of Registrar of Companies, there was no need to increase the paid-up capital at all. It is the say of the petitioners that as per the provisions of Sec. 3(5) of the Act, at the most, proceedings under Sec. 560 of the Act could have been initiated against the petitioners and not the criminal proceedings. General Circular No. 13 of 2003 has not been properly complied with and it was not even required for the Company itself to make an application. It is relevant to note that second application was also moved by the petitioner No. 1-Company on 24-6-2003 under Simplified Exit Scheme and appropriate administrative decision has been taken by the authority. Even then, the department is not dropping the proceedings or withdrawing the case.