K.C.Palanisamy v. The Assistant Registrar of Companies Tamil Nadu

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 28-03-2025CORAMTHE HONOURABLE MR JUSTICE G.K. ILANTHIRAIYANCRL OP NO. 9400 of 2025and Crl.MP.Nos.6225 & 6229 of 2025K.C.Palanisamy ... PetitionerVsThe Assistant Registrar of Companies Tamil Nadu, Registered OfficeShastri Bhavan, Haddows Road, Chennai – 600 006. ... RespondentPRAYER: Criminal Original Petition is filed under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, to call for the records in EOCC No.78 of 2023(split up from EOCC No.504 of 2009) pending on the file of the Additional Chief Metropolitan Magistrate EO – II Egmore, Chennai and quash the same as against the petitioner/5th accused. For Petitioner : Mr.N.RamakrishnanO R D E RThis petition has been filed to quash the proceedings in EOCC No.78 of 2023(split up from EOCC No.504 of 2009) pending on the file of the Additional Chief Metropolitan Magistrate EO – II Egmore, Chennai. Page 1 of 6 https://www.mhc.tn.gov.in/judis

The case of the prosecution is that the respondent filed a complaint under Section 166 of the Companies Act, alleging that the first accused is the company and the other accused are Directors of the first accused company. On inspection, the inspector noticed that the company had failed to conduct the Annual General Meeting for the year 2006. Therefore, this is a contravention of the provisions under Section 166 of the Companies Act and is punishable under Section 168 of the Companies Act. Since this is a continuing offence, it is not barred by limitation. After inspection, the accused were issued a show cause notice on 18.01.2008. However on receipt of the same, the accused failed to send any reply to the show cause notice. Hence, the complaint.

The learned Counsel appearing for the petitioner would submit that the petitioner is arrayed as the 5th accused and he was one of the Directors of the 1st accused company. After his induction as one of the Directors of the 1st accused company, his wife died due to illness, and as if the petitioner could not look into the management and affairs of the 1st accused company. In the meanwhile, a dispute arose between the accused and the company with regard to the management and administration. Therefore, he resigned from the Board of Directors of the 1st accused company with effect from 16.11.2005, and Form No. 32 was also filed before the Registrar of the Company. Therefore, the Page 2 of 6 https://www.mhc.tn.gov.in/judis petitioner is nothing to do with the 1st accused / Management and administration of affairs from 16.11.2005. The respondent filed a batch of complaints against all other accused persons for alleged contraventions of Sections 159, 210 and 220 and 166 of the Companies Act. He further submitted as per the offence under Section 166(1) of the Companies Act, the Annual General Meeting of the companies shall be held within a period of 15 months from the date of the last Annual General Meeting. Therefore, for the financial year 2006, the Annual General Meeting is to be held within a period of 15 months from the date of last Annual General Meeting. The petitioner had already resigned from the 1st accused company on 16.11.2005, much prior to the expiry of the timeline stipulated under Section 166 of the Act. Therefore, the petitioner is not held to be liable for the contraventions under Section 166 of the Act. 4. Heard the learned counsel for the petitioner and perused the materials available on record.

On perusal of the records, it reveals that the petitioner did not even whisper about the last Annual General Meeting held in the 1st accused company. Therefore, without specifying any date for the last Annual General Meeting, it Page 3 of 6 https://www.mhc.tn.gov.in/judis cannot be construed that, before the expiry of 15 month period, the petitioner got revealed from the 1st accused company by filing Form No.32 before the Registrar of Companies. It is all a disputed question of facts and cannot be decided here, especially under Section 482 of the Cr.P.C. This matter has to be taken further by the trial court. That part, the only reason for the petitioner's situation was the non-appearance of the petitioner before the Trial Court, which resulted in the trial being split up into EOCC.No.504 of 2009 against the petitioner, and now it is facing trial in EOCC.No.78 of 2003. Therefore the petitioner has failed to make out a prima facie case to entertain this quash petition, which is dismissed accordingly.

In view of the above discussion, this Court is not inclined to quash the proceedings in E.O.C.C.No.78 of 2023(split up from EOCC No.504 of 2009) on the file of the Additional Chief Metropolitan Magistrate EO-II, Chennai. The petitioner is at liberty to raise all the grounds before the trial Court. Page 4 of 6 https://www.mhc.tn.gov.in/judis