G HUBERT FENELON Vs. D SRIDHARAN

JUDGEMENT

(1.) These four original petitions are filed to quash the proceedings in C.C.No.3848 of 2000, 3846 of 2000, 3847 of 2000 and 3845 of 2000 respectively.

(2.) The petitioners state in their affidavits as follows: The petitioners herein were directors of the Royapettah Benefit Fund Nidhi Limited, (hereinafter referred to as "RBF Nidhi), a company incorporated under the Companies Act. The petitioners were whole time Fee-Directors receiving salary without any eligibility in respect of profits or dividends. The administration of the functions of the said R.B.I. Nidhi are regulated by the Companies Act and rules. Due to misapplication of funds by interested persons, the administration of the funds of the said RBF Nidhi came to shambles and it resulted in postponement and delay in payment of the dues to the depositors. During the second week of December, 1999, the position became critical to satisfy the demands of the depositors. A case under Sections 420, 408 and 120-B of I.P.C. was registered on a complaint by one of the depositors. The petitioners were arrested and subsequently, released on bail. The petitioners were also taken in custody to Hyderabad, Visakhapatnam and other places. The affairs of the R.B.F. Nidhi are looked after by a Special Officer appointed by the Company Law Board by Order, dated 18.11.1999. The Special Officer took over the administration from 20.12.1999. The managers of the branches of the RBF Nidhi at Chennai, Visakhapatnam and Hyderabad were left with cheques, signed by any one of the petitioners, when they were in office as Directors. These petitioners were removed from the Board of Directors of R.B.F. Nidhi, by order dated 18.1.2000 by the Company Law Board. In the place of erstwhile directors, a new set of seven persons were appointed by the Company Law Board and they took over the administration.

(3.) The Company Law Board in its order, approved a scheme for repayment of the dues to the depositors and in respect of the cheques issued on behalf of the RBF Nidhi Limited signed by any of the Directors. As per the order of the Company Law Board, the deposits which had already matured would be treated as alive; the interest payable on such deposits would be frozen as at November, 1999 and the cheques issued by any of the petitioners would be treated as cancelled; the payment of dues at the rate of 10% on the matured deposits or Rs.2,000/- whichever is higher would be paid to the depositors on returning the cheques already issued.