THE PUBLIC PROSECUTOR Vs. USTEPALLE SWAMI CHETTY AND ORS.
HIGH COURT OF MADRAS
The Public Prosecutor
Ustepalle Swami Chetty
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Somasundaram, J. -
(1.) THIS is an appeal by the State against the acquittal of the respondents herein on the ground that no proper sanction has been accorded for the prosecution of the accused for offences under Sections 76 and 131, Companies Act.
(2.) A complaint was laid against the respondents by the Assistant Registrar at the instance of the Registrar of Joint Stock Companies for the said offences. Under Section 248 (2), Companies Act
"The Central Government may appoint such registrars and assistant registrars as it thinks necessary for the registration of companies under this Act, and may make regulations with respect to their duties."
In pursuance of this power, the Central Government has made certain regulations and we are concerned here only with Regulation 14(a) and (b). Regulation 14(a) says:
"The Registrar may in his discretion institute such enquiries or make such investigation in respect of any matter as may in his opinion toe necessary for the proper performance of his duties and the due administration of the Act and may institute or cause to be instituted prosecutions under the Act for defaults on the part of companies or persons in furnishing such returns, documents or notices as the law requires them to furnish or for any other non -compliance of the provisions of the Act for which penalties are provided therein."
Clause (b) says:
"Whenever it is found necessary to enforce the penal provisions of the Act against any company or person, the Registrar or Assistant Registrar, as the case may be, shall request the State Counsel in case the registered office of the company concerned is situated in the city of Madras, and in other cases, the District Magistrate of the district in which such registered office is situated, to take the necessary steps."
In this case there is no doubt that the Assistant Registrar has written to the District Magistrate setting out the facts of the case and asking him to take necessary action but the District Magistrate seems to have given the paper back to the Assistant Registrar who merely filed it in court It is now contended that according to the Regulation 14(b), the complaint must be laid either by the District Registrar or District Magistrate, or at the instance of the District Magistrate. The lower court has taken the view that such a complaint is necessary and therefore acquitted the accused as there was no such complaint of the District Magistrate or at his instance.
(3.) WITH regard to the offence under the Companies Act there is no provision that any offence should not be taken cognizance of unless the complaint is filed by any of the persons mentioned in the Act. In the absence of such a provision the normal rule namely that any person may set the criminal law in motion will apply. But in cases under the Companies Act, it has been considered desirable that either the Registrar or Joint Registrar or officer concerned in dealing with the Act should prefer the complaint. The Regulations framed assigned the duty of making investigations into these matters to the above officers and directing them to file the complaint in such matters. But these Regulations do not take away the right of any citizen to file a complaint under the Companies Act. In the absence, therefore, of any special provision requiring that the complaint should be filed by a particular person, a complaint either by any citizen or a member of the company or by the Assistant Registrar will be a valid complaint. The complaint, therefore, filed in this case is a valid one and the acquittal on that ground is wrong and is therefore set aside. The case is remanded to the lower court for disposal according to law.;
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