Section 633(2) relief, non-continuing defaults, and limitation barred cognizance in a Companies Act prosecution.

Section 633(2) of the Companies Act, 1956 was treated as a remedial provision that can still be invoked after criminal complaints are filed, so the court retained jurisdiction to consider relief on merits if the officer had acted honestly and reasonably. Defaults relating to annual general meeting and statutory filing requirements were held not to be continuing offences where the breach was complete on expiry of the prescribed time and the penalty merely increased with duration of non-compliance. On limitation, complaints filed after the six-month period for fine-only offences did not amount to valid cognizance absent condonation under section 473. Relief was therefore available and the prosecution could not be sustained on those facts.

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Issues: (i) Whether relief under section 633(2) of the Companies Act, 1956 could be granted after criminal complaints had already been filed; (ii) whether the defaults relating to annual general meeting and filing requirements were continuing offences; (iii) whether cognizance could be said to have been taken merely on filing of complaints when limitation had expired.

Issue (i): Whether relief under section 633(2) of the Companies Act, 1956 could be granted after criminal complaints had already been filed.

Analysis: The provision was treated as enabling the court to relieve an officer from liability where he had acted honestly and reasonably and the circumstances justified relief. The court accepted that, once prosecution had commenced, the relevant court could still examine the request for relief. The filing of complaints did not by itself deprive the court of jurisdiction to consider the application on merits.

Conclusion: Relief under section 633(2) remained available notwithstanding the prior filing of complaints.

Issue (ii): Whether the defaults relating to annual general meeting and filing requirements were continuing offences.

Analysis: The court applied the principle that where a statutory default is complete on the expiry of the prescribed time and the statute merely enhances the penalty with reference to the duration of default, the offence is not continuing. The provisions governing the alleged defaults under sections 159, 210 and 220 were found to operate in that manner. The lapse was therefore complete on the relevant due dates and did not renew from day to day.

Conclusion: The alleged defaults were not continuing offences.

Issue (iii): Whether cognizance could be said to have been taken merely on filing of complaints when limitation had expired.

Analysis: The applicable limitation period for offences punishable only with fine was six months under the Criminal Procedure Code. Since the complaints were filed after that period and no condonation under section 473 had been shown, mere filing of the complaints did not amount to valid cognizance. Cognizance could not be assumed in the absence of an order lifting the limitation bar.

Conclusion: Mere filing of the complaints did not amount to cognizance in the absence of condonation of delay.

Final Conclusion: The petitioner was entitled to be relieved of the alleged liabilities and consequences arising from the complaints, and the prosecution-related proceedings could not stand against him on the facts found.

Ratio Decidendi: A court may relieve an officer under section 633(2) of the Companies Act, 1956 even after prosecution has commenced, and a statutory default that is complete on the expiry of the prescribed time is not a continuing offence merely because the penalty is linked to the duration of non-compliance; where limitation has expired and no condonation is granted, cognizance cannot be treated as validly taken on mere filing of the complaint.

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