B.V. RAMESH Vs. RESERVE BANK OF INDIA

JUDGEMENT

(1.) The petitioners in the above criminal original petitions have been arrayed as third and sixth accused respectively in the original E.O.C.C.No.14 of 2001. After the case was split up against certain accused, the case was assigned number viz., E.O.C.C.No.136 of 2010, wherein they had been arrayed as first and second accused respectively. The complaint was filed by the respondent herein for the offences under Ss. 45QA, 58B (4AAA) and 58C of the Reserve Bank of India Act, 1934 against M/s.Kreast Finlease Ltd., and its Directors.

(2.) The allegations in the complaint are that M/s.Kreast Finlease Ltd., and its Directors failed to comply with the orders passed by the Company Law Board dtd. 28/4/1998, 22/6/1998, 23/7/1998, 5/10/1998 and 1/12/1998 directing the first accused / Company to repay the depositors in accordance with the terms and conditions set out in the said orders which were passed on the applications filed by several depositors. Three accused had participated and represented the Company in the proceedings before the Company Law Board and had undertaken to repay the depositors. The respondent had sent a notice dtd. 15/6/1999 to the first, second, sixth, seventh and eighth accused (ranking prior to splitting up of the case) to ascertain as to whether the first accused had complied with the directions given by the Company Law Board and calling upon them to report compliance of the directions of the Company Law Board. The Company and the Directors wilfully failed to report compliance and the said act of the first accused and its Directors constituted an offence under Sec. 58B (4 AAA) of the Reserve Bank of India Act, 1934, and that the other accused were directors incharge and responsible to the first accused for the conduct of its business and hence liable for the said offence.

(3.) (a) Mr.Sathish Parasaran, learned Senior Counsel for the petitioner in Crl.O.P.No.2415 of 2014 submitted that the complaint suffers from non-application of mind in as much as the petitioner was never a director of the Company. He was working as Company Secretary for the period between 5/11/1997 to 30/11/1998. As a Company Secretary, his role in the Company was purely administrative and ministerial in nature. The Company Secretaries cannot be equated with Directors who are in the management of the company. In any case, there are no specific allegations as against the petitioner as to the role played by him. The final order dtd. 1/12/1998, which is said to have been violated by the Company and its Directors, was passed after he relinquished his office as Company Secretary on 30/11/1998. Hence, it cannot be said that he violated the order.