RAMA BHUSHANAM Vs. REGISTRAR OF COMPANIES

JUDGEMENT

(1.) This is an application filed by the petitioners under Section 482 of the Code of Criminal Procedure to quash the proceedings in C. C. No.29 of 1998 on the file of the learned Special Judge for Economic Offences, Hyderabad, in which the petitioners herein are arrayed as A-1 and A-2 respectively.

(2.) The first respondent-Registrar of Companies filed a complaint against the petitioners herein under Section 58-A (6) of the Companies Act, 1956 (for short 'the Act') read with Rule 11 of the Companies (Acceptance of Deposits) Rules, 1975 (for short 'the Rules').

(3.) Petitioner No. 1 is the Managing Director and petitioner No. 2 is the Director of the company known as "M/s. Commercial Agro Products Private Limited", which was incorporated on 21-7-1993. In the complaint filed by the first respondent, it is alleged that the respondent- complainant observed from the balance sheet as at 31st March, 1995 and 31st March, 1996 the company has under the guise of sheep units and through other schemes invited and accepted deposits from the public and the amounts outstanding under the above heads in the balance sheet as at 31-3-1995 and 31-3-1996 are Rs.10.51 crores and Rs.10.44 crores respectively. It is the case of the respondent-complainant that the aforesaid amounts were accepted by the said company without complying the requirements of advertisement limits as stipulated under Section 58-A (1) and (2) of the Act. The Company did not comply with the Rules of the Companies (Acceptance of Deposits) Rules, 1975 which stipulate the requirements of maintenance of liquid assets, the limits up to which the deposits can be invited and accepted, filing of text of advertisement/statement in lieu of advertisement, maintenance of deposits and filing of return of deposits, etc.