Sanjib Banerjee, J. - (1.) OF the 12 show -cause notices in respect of which the present proceedings have been instituted, four have been pressed with more vigour than the others, though the Registrar has made no concession in respect of the others. The first, second, third and sixth show -cause notices appearing at pages 80, 84, 88 and 102 of the petition, all relates to the alleged violation of Section 211 of the Companies Act, 1956. In the first three notices the violation complained of is under Section 211 (3A) read with one or the other Accounting Standards that have now been formally made the yardstick for writing and examining the company accounts by a recent amendment to the Act. The sixth notice complaint of violation under Section 211(1) of the Act read with Schedule VI thereto. The ninth notice complains of the petitioners having violated Section 211(2) of the Act read with Part II of Schedule VI thereto. The eight and eleventh notices complains of violation of Section 217(1)(e) of the Act in the matter as to the contents of the director's report. The twelfth notice refers to the provisions of Sections 127 and 292 of the Act having been breached.
(2.) IN the affidavit used by the Registrar, a point of law has been urged. The Registrar contends, in substance, that for the provisions of Section 633(2) of the Act to apply, the petitioning officer must first concede as to default and then seek pardon by demonstrating that he had acted honestly and reasonably. It is urged, that the High Court has to take into account the circumstances of the accepted default. Such point needs first to be addressed before the merits of the charges levelled and the justification of excuses proffered can be gone into. The Registrar urges that there is material difference between Sub -sections (1) and (2) of Section 633 of the Companies Act and that what the criminal court receiving the Registrar's complaint can do, the High Court cannot under Sub -section (2). The Registrar contends that ordinarily oral evidence is not received by the High Court while dealing with a petition under Section 633(2) of the Act and as to whether there has been any default or not cannot be ascertained without oral evidence being received and other documents that may be tendered in the course of a trial, being assessed. Section 633 of the Act provides as follows: 633. Power of court to grant relief in certain cases. - -(1) If in any proceeding for negligence, default, breach of duty, misfeasance or breach of trust against an officer of a company, it appears to the court hearing the case that he is or may be liable in respect of the negligence, default, breach of duty, misfeasance or breach of trust, but that he has acted honestly and reasonably, and that having regard to all the circumstances of the case, including those connected with his appointment, he ought fairly to be excused, the court may relieve him, either wholly or partly, from his liability on such terms as it may think fit: Provided that in a criminal proceeding under this Sub -section the court shall have no power to grant relief from any civil liability which may attach to an officer in respect of such negligence, default, breach of duty, misfeasance or breach of trust. (2) Where any such officer has reason to apprehend that any proceeding will or might be brought against him in respect of any negligence, default, breach of duty, misfeasance or breach of trust, he may apply to the High Court for relief and the High Court on such application shall have the same power to relieve him as it would have had if it had been a court before which a proceeding against that officer for negligence, default, breach of duty, misfeasance or breach of trust had been brought under Sub -section (1). (3) No court shall grant any relief to any officer under Sub -section (1) or Sub -section (2) unless it has, by notice served in the manner specified by it, required the Registrar and such other person, if any, as it thinks necessary, to show cause why such relief should not be granted.
(3.) SUB -section (2) confers on the High Court the same power as the criminal court in granting relief to the petitioning officer who apprehends that proceedings might be brought against him in respect of any negligence, default, breach of duty, misfeasance or breach of trust. Sub -section (2), in its closing part, identifies the criminal court and provides that the High Court will have the same powers as the criminal court to relieve a petitioning officer. The expression "if it had been a court before which a proceeding against that officer...had been brought under Sub -section (1)" makes it clear that the High Court in exercise of powers under Sub -section (2) will have the same powers as the court receiving the criminal proceedings. Such expression does not imply that the High Court will exercise only such powers under Sub -section (2) that the criminal court may, upon the criminal court finding the charged officer guilty. For the criminal court to relieve the charged officer, such court may or may not conclude that the charged officer is liable. There can be no other meaning to the expression "he is or may be liable" found in Sub -section (1). If the criminal court can relieve a charged officer without coming to any conclusion that the charged officer is actually guilty or is liable for the offence, so can the High Court. In taking into account the surrounding circumstances, the criminal court may form a tentative opinion, without a full -fledged trial, as to whether there may not have been any offence at all. In considering whether a charged officer should be relieved, and before conducting the trial at which guilt may be established, the surrounding circumstances that the criminal court can look into would include a tentative view of the likelihood of the charge being established.;