ORDER
K.B. Siddappa, J.
1. As common question of law arises in these two cases, they are disposed of by this common order.
2. Criminal Petition No.3570 of 1995 is filed under Section 482 Cr.PC. to quash the proceedings in STC No.93 of 1995 on the file of IV Additional Judicial First Class Magistrate, Kakinada.
3. The matter came up before the learned Sri P. Ramakrishnam Raju, J with the following facts:
The respondent company had filed STC No.93 of 1995 against the petitioner under Sections 622 and 630 of Companies Act before the IV Additional Judicial First Class Magistrate, Kakinada. The petitioner’s contention was that by virtue of G.O.
Rt.No.734 Home (Courts-A) Department, dated 13-3-1981, a Special Court is constituted to deal with the offences arising out of certain enactments including the Companies Act. Therefore, the Judicial First Class Magistrate has no jurisdiction to try the case. In support of this contention the learned Counsel had relied upon the judgment in K.K. Maheswari v, M/s. Rockhard Building Materials Limited, 1994 (1) APLJ 155.
4. It is also contended that the allegation made against the petitioner is that he did not produce the Minutes Book and Attendance Registers of the Board meetings and General Meetings. The maximum penalty provided under Sections 143 or 162 of the Act is only a fine of Rs.500/-. Therefore, there cannot be any higher charge against the petitioner for not producing the records when the same is not maintained. It was also contended that non-production of record may at best amount to non-maintenance of the record. The record cannot be included in the term ‘property’.
5. The learned Counsel for the 1st respondent Sri C. Padmanabha Reddy had submitted that sub-section (2) of Section 630 of the Act provides sentence of imprisonment for non-production of property. This sub-section applies to the case of the petitioner as the petitioner had withheld the account books. According to him, Section 630 of the Act is broadly worded so as to include in its sweep any property whether movable or immovable, belonging to the Company. In support of his contention he relied upon the judgment in Beguram v. Jaipur Udhyog Limited, 61 Company Cases 744. He had also submitted that the Magistrate is competent to try the offence.
6. After hearing both the sides, Sri P. Ramakrishnam Raju, J differed from the view taken by Sri Justice Panduranga Rao,
rendered in the case (1) referred above, in that case, Sri Panduranga Rao, J held that the Companies Act, 1956 is one of the central Acts mentioned in the GO constituting the Special Court for trial of the offences covered by that Act. Therefore, all the offences under the Companies Act are triable by Special Judge for Economic Offences. The Magistrate was directed to return the complaint to the 1st respondent for being presented before the Special Judge for Economic Offences.
7. Sri P. Ramakrishnam Raju, J accepted the contention of Sri Padmanabha Reddy, Counsel for the 1st respondent, that the Special Court has jurisdiction to take cognizance of an offence only against the Act either by the Company or by any Officer. Such a case is not made out in the instant case. Therefore, it is not an offence against the Act either by the Company or by any officer thereof so as to attract the jurisdiction of Special Court.
8. In view of the above divergent opinions, the matter is referred before this Bench.
9. Criminal Revision Case No.527 of 1995 is filed against the judgment passed in CC No.31 of 1986 on the file of Judicial First Class Magistrate, Hyderabad West & South, Rangareddy District. In this case, the I.D.L Chemical Limited had filed a complaint against the accused who had worked as Managing Director of the Company from 1962 to 31-3-1984. He was in occupation of house bearing No.7-2-21-A, Begumpet, Hyderabad along with furniture. The services of the accused were terminated. However, he failed to handover the house inspite of legal notice. This constituted an offence under Section 630 of Companies Act. The Magistrate held following the Judgment of this Court referred (1) above, that the Special Court for Economic Offences, Hyderabad has jurisdiction to try the offence.
10. This Revision came up for hearing before Sri N.Y. Hanumanthappa, J. On representation that similar question is referred to Bench by Sri P. Ramakrishnam Raju, J, this Revision is also referred to this Bench.
11. Mr. C. Padmanabha Reddy appearing for the 1st respondent submitted that the offence complained of cannot be said that it is in the nature of economic offence. The accused is complained of withholding the record after he ceased to be the Managing Director. The Special Court for Economic Offences which is constituted under G.O. Rt.No.734, Home (Courts-A) Department, dated 13-3-1981 is expected to deal with only Economic Offences. The offence complained of, by its very nature, cannot be termed as ‘Economic Offence’ though the jurisdiction to try all the offences under the Act is given to the Special Court for Economic Offences. All the offences, particularly in the nature of the offence complained of, cannot be tried by the Special Court for Economic Offences. According to Mr. Padmanabha Reddy, the Magistrate has jurisdiction to try the offence.
12. We cannot accede to this contention. It is true that what is an ‘Economic Offence’ is not defined anywhere. The words ‘Economic Offence’ indicate that there is offence in relation to money or property, or the goods and services which have exchange value. It is also .true that the offence complained of has no tinge of ‘economic offence’. By this ground alone we cannot oust the jurisdiction of Special Court for Economic Offences. The GO clearly enlists the offences under Companies Act, in addition to other enactments. When all the offences under the Companies Act are brought within the purview of Special Court for Economic Offences, there is no justification in making division in the offences arising under the Companies Act on the basis of ‘economic’ or ‘non-economic’. That would render the
inclusion of the Companies Act in the list of the Acts in the GO constituting Special Court, redundant. If the Parliament intended to distinguish between ‘economic’ and ‘non-economic’ offences, they would have specified the Sections which come under the purview of Special Court for Economic Offences. In the instant case, there is no such distinction and the whole of Companies Act is included in the list of the Acts which come under the jurisdiction of the Special Court for Economic Offences. Therefore, we hold that all the offences, either ‘economical’ or ‘non-economical’ (in nature) are triable by the Special Court for Economic Offences.
13. Mr. C. Padmanabha Reddy further submitted that the allegation against the petitioner is that he withheld the records after he ceased to be the Managing Director. According to him, it is not an offence against the Act, either by the Company or ‘by an Officer’ thereof, so as to attract the jurisdiction of the Special Court.
14. We have already mentioned that this argument found favour with the learned single Judge who referred this matter to the Bench.
15. We are again not impressed by this argument. The petitioner might have ceased to be the Managing Director. That itself is not sufficient to say that he is ‘not the Officer’ of the Company. The ex-Officer is also obliged to produce all the official records in his custody pertaining to the Company before he is discharged from the allegation. Therefore, the observation of the learned single Judge: “It is contended by Sri Padmanabha Reddy and rightly in my view, that the Special Court has no jurisdiction to take cognizance of an offence committed against the Act either by the Company or any Officer. In this case the allegation made against the petitioner is that he had withheld the Records after he ceased to be the Managing Director. Therefore, it is not an
offence against the Act either by the Company or any Officer thereof so as to attract the jurisdiction of the Special Court” is not acceptable to us. It is a common knowledge that under many enactments even retired officers are prosecuted for their omissions and commissions while they were in office. Therefore, prosecution is maintainable even if the officer ceased to be the officer of the Company when the prosecution is launched. The non-production of the records is one of the offences under the Companies Act which is enlisted along with other Acts in the GO constituting the Special Court. Certainly, the Special Court has jurisdiction to try the offence. We respectably disagree with the view taken by Sri P. Ramakrishnam Raju, J. We agree with the ratio of the Judgment rendered in the case (1) referred above.
16. The complainant may take such steps for filing the complaint before the Special Court for Economic Offences to try the offences. Consequently, the proceedings in STC No.93 of 1995 on the file of IV Additional Judicial First Class Magistrate, Kakinada are quashed. The Judgment passed in CC No.31 of 1986 on the file of Judicial First Class Magistrate, Hyderabad West & South Ranga Reddy District, is upheld.
17. In the result, Criminal Petition No.3570 of 1995 is allowed and Criminal Revision Case No.527 of 1995 is dismissed.