Case Note & Summary
The appeal challenges the judgment and order dated 18th December 2009 of the learned Company Judge discharging accused nos.2 to 5 in Company Complaint No.8 of 2001 under the Companies Act, 1956. The appellant, Shri Arun s/o Baburao Wadikar, contended that no application for discharge was filed by the accused, and the discharge was ordered without any opportunity to the complainant to oppose. The respondents argued that the Company Judge had concluded based on affidavits that there was no involvement of respondent nos.2 to 5. The High Court held that the discharge was made without any application and without hearing the complainant, violating principles of natural justice. The court set aside the impugned order and restored the complaint against respondent nos.2 to 5, directing the Company Judge to proceed with the trial in accordance with law.
Headnote
A) Criminal Procedure - Discharge of Accused - Suo Motu Discharge - The Company Judge discharged accused nos.2 to 5 without any application for discharge and without giving an opportunity to the complainant to oppose, violating principles of natural justice - Held that such discharge is unsustainable and set aside (Paras 3-6).
Issue of Consideration
Whether the Company Judge could discharge accused nos.2 to 5 in a criminal complaint under the Companies Act, 1956, without any application for discharge and without affording an opportunity of hearing to the complainant.
Final Decision
Appeal allowed. Impugned order dated 18th December 2009 is set aside. Company Complaint No.8 of 2001 is restored against respondent nos.2 to 5. The Company Judge is directed to proceed with the trial in accordance with law.
Law Points
- Discharge without application
- natural justice
- opportunity of hearing
- Companies Act
- 1956
Case Details
2010 LawText (BOM) (09) 156
Company Appeal No.6 of 2010 in Company Complaint Application No.8 of 2001 in Official Liquidator Report No.42 of 2000 in Company Petition No.1 of 1998
J.P. Devadhar, A.B. Chaudhari
Mr.S.S.Adkar for appellant, Smt.Anita P. Shinde for respondents
Shri Arun s/o Baburao Wadikar
Official Liquidator, High Court, Nagpur; Shri Sunil s/o Salenrao Ghorpade; Shri Purushottam Ramchandrao Malewar; Shri Vijay Ramkrishna Khopde; Shri Digvijay Shingh s/o Ganbhirsing Mohite
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Nature of Litigation
Appeal against order discharging accused in a criminal complaint under the Companies Act, 1956.
Remedy Sought
Setting aside the discharge order and restoration of the complaint against respondent nos.2 to 5.
Filing Reason
The Company Judge discharged accused nos.2 to 5 without any application for discharge and without affording an opportunity to the complainant to oppose.
Previous Decisions
The learned Company Judge discharged accused nos.2 to 5 by judgment and order dated 18th December 2009.
Issues
Whether the Company Judge could discharge accused without any application for discharge?
Whether the discharge order violated principles of natural justice for want of opportunity to the complainant?
Submissions/Arguments
Appellant: No application for discharge was filed; the impugned order could not have been made without opportunity to oppose.
Respondents: The Company Judge concluded based on affidavits that there was no involvement of respondent nos.2 to 5, so no fault with the order.
Ratio Decidendi
Discharge of accused in a criminal complaint without any application for discharge and without affording an opportunity of hearing to the complainant violates principles of natural justice and is unsustainable.
Judgment Excerpts
Learned counsel for the appellant restricted his submission saying that after the registration of the said Criminal case, no application for discharge from the criminal case was at all filed.
According to him, in absence of any application and opportunity to oppose any such move for discharge, impugned order could not have been made.
Procedural History
Company Petition No.1 of 1998 was filed, leading to Official Liquidator Report No.42 of 2000, then Company Complaint Application No.8 of 2001. The Company Judge discharged accused nos.2 to 5 on 18th December 2009. The appellant filed Company Appeal No.6 of 2010 against that order.
Acts & Sections
