IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.T.RAVIKUMAR MONDAY, THE 23RD MARCH 2009 / 2ND CHAITHRA 1931 Crl.MC.No. 4071 of 2006 ------------------------- ST.442/2005 of ADDL.CHIEF JUDICIAL MAGISTRATE (E & O),ERNAKULAM .................... PETITIONER / 4TH ACCUSED: ------------------------------- SRI.SHABI MOHANDAS, AGED 38 YEARS, S/O.MOHANDAS, KOTTARATHIL HOUSE, NEAR KURISSUPALLY VADUTHALA P.O., ERNAKULAM. BY ADV. SRI.ABRAHAM MATHEW (VETTOOR) RESPONDENTS/COMPLAINANT AND ACCUSED 1 TO 3 AND 5: ------------------------------------------------------------------- 1. THE ASSISTANT REGISTRAR OF COMPANIES, KERALA, B.M.C. ROAD, ERNAKULAM, COCHIN-21. 2. M/S.GOLDEN EARTH GROVES LTD., (REPRESENTED BY ACCUSED NO.2 4TH FLOOR, MAHREEN BUILDING, PULLEPADY JUNCTION, COCHIN-35. 3. SRI.K.ARUN KUMAR, AGED 43 YEARS, KOLLAMPARAMBIL, TAGORE STREET, DESHABHIMANI ROAD, KOCHI-17. 4. SMT.VIJI MOHAN, AGED 39 YEARS, KOLLAMPARAMBIL, TAGORE STREET, DESHABHIMANI ROAD, KOCHI-17. 5. SRI.ASHRAF ALI, AGED 48 YEARS, S/O.V.K.BASHEER AHAMED, NO.4, V.BLOCK, DALAL ESTATE APARTMENT, OPP.BOMBAY CENTRAL RAILWAY STATION, MUMBAI-400 034. 6. STATE OF KERALA REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA. ADV. SRI.ANCHAL C.VIJAYAN, CGC FOR R1 THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 23/03/2009, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: Crl.MC.No. 4071 of 2006 ORDER ON CRL.M.A.NO.7348/06 IN CRL.M.C.NO.4071/2006 DISMISSED. 23.3.2009 SD/- C.T.RAVIKUMAR, JUDGE. // TRUE COPY // P.A TO JUDGE. C.T.RAVIKUMAR, J. --------------------------- Crl.M.C.No.4071 of 2006 ----------------------------- Dated this the 23rd day of March, 2009 O R D E R The petitioner is an indictee in S.T.No.442/2005 on the file of the Additional Chief Judicial Magistrate (Economic Offence) Court, Ernakulam. He is accused No.4 therein. The first respondent herein filed Annexure-A complaint under Section 234 (4)(A) of the Companies Act for the default in compliance with the provisions of Section 234 (3)(A) r/w Sub Sections 2 and 3 of Section 234 of the Companies Act. As per the complaint, accused No.1 is a public limited company incorporated under the Companies Act represented by accused No.2 therein, the manager of the accused No.1 company. Accused Nos. 3 to 5 were the other directors of the company at the relevant time, according to the complaint. Annexure-A complaint the case was taken into the file of the Additional Chief Judicial Magistrate (Economic Offence), Ernakulam and was registered as S.T.NO.442/2005 and that court has issued non bailable warrant against the petitioner as well. It was in the said circumstances Crl.M.C.No.4071 of 2006 2 that the petitioner who is the fourth accused in the said case approached this Court by filing the above Crl.M.C. seeking to quash Annexure A complaint in S.T.No.442/2005 on the file of the Additional Chief Judicial Magistrate (Economic Offence), Ernakulam in so far it relates to him. 2. Admittedly, the petitioner was one of the Directors of the said company and it is contended that on account of his resignation he ceased to be a Director as is evident from Annexure-B. Based on the same, it is further contended that he had no involvement in any of the affairs of the business of the company and therefore, no complaint is sustainable against him in the capacity as its director. Besides the said contention it is also contended that has has not received any notice under Section 234(3)(a) of the Act or any other letter or notice from the first accused company and therefore he had no occasion to cause production of the required documents as required by the first respondent. In fact, it was based on a letter dated 8.8.2003 containing the said allegation raised by Sri. Bhagavan and others that the first respondent called upon comments from the first accused company as per the provisions under Section 234(1) of Crl.M.C.No.4071 of 2006 3 the Companies Act. On the failure of the first accused company to furnish the comments called for, the first respondent herein issued an order under Section 234(3)(a) of the Companies Act on 14.12.2004 whereby the company and its directors were directed to produce the required registers on 23.12.2004. The allegation is that the first respondent requested time for production of the documents. Even thereafter, it failed to produce the records and thus failed to comply with the orders issued and in that circumstances a show cause notice as contemplated under law was issued to all the accused to furnish the reason as to why penal action should not be lodged under Section 234(4)(a) of the Act. As per the allegations in the complaint no reply was furnished to the aforesaid notice and thereafter obtaining the requisite permission for lodging prosecution against the company and its directors Annexure A complaint has been preferred. Be that as it may, the question is whether the petitioner ceases to be a director of the accused company and whether such resignation as its director would render the prosecution now lodged against him as unsustainable. To sustain his contention the petitioner has produced Annexure-B which is a copy of the Crl.M.C.No.4071 of 2006 4 search report in respect of the particulars of directors from the file maintained at the office of the Registrar of Companies, Kerala with respect to the first accused company and obviously, it was issued by a chartered accountant. However, it is submitted that the petitioner had not raised any such question before the court below. The question as to the period covered by Annexure-A complaint and whether by virtue of Annexure-B, the petitioner is entitled for discharge are matters which require consideration based on relevant and necessary materials. Without those relevant materials before this Court, I am not in a position to uphold the contentions of the petitioner. I think I should not embark upon a enquiry in this proceedings to find out whether Annexure-B is an authenticated document which would absolve all the responsibilities and liabilities of the petitioner as a direction of the first accused company. Of course, the petitioner can raise all these contentions and other related matters requiring for discharge before the court below at the appropriate stage. Crl.M.C.No.4071 of 2006 5 In view of the above discussion, the above Crl.M.C is disposed of by granting liberty to the petitioner to raise a plea of discharge based on Annexure B or any other relevant documents acceptable in law, at the appropriate stage, if that stage is not crossed now. Needless to say that, if such a question is raised, the court below shall consider that question and pass appropriate orders in accordance with law, as expeditiously as possible. C.T.RAVIKUMAR, JUDGE. bkn/-