SUNIL DUTT MISHRA Vs. UNION OF INDIA

JUDGEMENT

(1.) Heard.

(2.) This petition has been filed by the two petitioners, who have been arrayed as accused in Complaint Case No. 1213(C). The complaint petition was filed by the Union of India through the Registrar of Companies, Bihar and Jharkhand, alleging that in spite of the show cause notice to the Company and its Directors and Accused Nos. 2 to 8 failed to file the annual returns as obligated under Section 159 of the Companies Act, 1956 and as such committed an offence punishable under Section 162(1) of the Companies Act, 1956. It was alleged that they were the 'officers in default' and, as such, they were liable for not filing the return as was required to be filed under Section 159 of the Companies Act.

(3.) The ground, which has been urged before me, is that'Section 5 of the Companies Act defines the officer, who is in default and that provision does not include a Director who has not been assigned with any responsibility by the Board of Directors. It was contended by citing a very long line of decisions like, (Raj.), Ravindra Narayan and Others vs. Registrar of Companies, Rajasthan,1994 81 ComCas 925 H. Nanjundiah vs. V. Govindan, Registrar of Companies, Maharashtra and Another, 1986 59 CompCas 356(Kerala), V.M. Thorns vs. Registrar of Companies,1980 50 CompCas 247 , P.C. Wadhwa vs. S.C. Bhatia and finally, 1995 Supp4 SCC 244G.L. Gupta vs. D.N. Mehta and Another, 1971 AIR(SC) 2162that by virtue of the definition of the term "officer in default" and in the light of the admitted fact that the petitioners were not the Principal Officers of the Company and as such were not the officers in default the very prosecution of the two'petitioners was not maintainable. It was further contended that there was an instruction issued by the Company Law Board in the light of 1994(81) Company Cases 925(Raj.) by which it has been directed that no prosecution shall be filed against the Directors or managerial personnel, such as, the Managing Director if no managerial responsibility has been thrust upon any of them. The Copy of Circular No. 6/94 F. No. 3/41/03-CLV dated 24th June, 1994 has been annexed to the supplementary affidavit filed by the petitioners.