DEPT OF NON-BANKING COMPANIES RESERVE BANK OF INDIA AND STATE OF MAHARASHTRA Vs. ARIHANT FINANCE AND CHIT FUND P LTD

JUDGEMENT

(1.) THESE two Appeals Nos. 631 of 1981 and 632 of 1981 have been preferred by the complainant, Shri B. N. Chikarmane, Deputy Chief Officer, Department of Non-Banking companies, Reserve Bank of India, Bombay Regional Office, against the judgment and order dated August 18, 1980, in Criminal Cases Nos. 298/s of 1979 and 299/s of 1979 passed by the learned Additional Chief Metropolitan Magistrate, 19th Court, Esplanade, Bombay, and the third appeal No. 989 of 1981 has been filed by the State of Maharashtra against the judgment and order in Criminal Case No. 298/s of 1979.

(2.) IN Criminal Case No. 298/s of 1979, the accused were charged for the offence punishable under Sections 58b (5) (a) and 58c of the Reserve Bank of India Act, 1934, for collecting Rs. 43,000 by way of deposits by the accused Nos. 1 to 12 between November 1, 1977, and January 28, 1978, in contravention of the prohibitory order dated November 1, 1977, issued by the reserve Bank of India. In Criminal Case No. 299/s of 1979, accused Nos. 1 to 12 were prosecuted for the offence punishable under Sections 58b (5) (a) and 58c of the Reserve Bank of india ,act for collecting Rs. 5,86,000 by way of deposits between October 1, 1976, and March 31, 1977, in contravention of direction No. 4 of the 1973 Directions.

(3.) ACCUSED No. 1 is a company doing its business under the name and style "arihant Finance and Chit Fund Pvt. Ltd. " having its office in Bombay and accused Nos. 2 to 12 are the directors of accused No. 1. Accused No. 1 is a miscellaneous non-banking company. The said company has been conducting a prize chit scheme styled as "arihant Small Saving Group Scheme" since october, 1974, and subscriptions were accepted in the said scheme from the members of the said scheme. It is alleged by the complainant that the company accepted deposits in contravention of the Directions issued by the Reserve Bank of India and collected huge amounts. It is alleged that the accused, in contravention of direction No. 4 of the Directions issued by the Reserve Bank of india in 1973, between October 1, 1976 and March 31, 1977, accepted Rs. 5,86,000 by way of deposits and thereby committed an offence punishable under Sections 58b (5) (a) and 58c of the reserve Bank of India Act. In the other criminal case, it was alleged that the Reserve Bank of india passed a prohibitory order dated November 1, 1977, and accused Nos. 1 to 12, in contravention of the said prohibitory order, collected Rs. 43,000 by way of deposits and thereby committed an offence punishable under Sections 58b (5) (a) and 58c of the Reserve Bank of india Act.