Relief for honest and reasonable company officers under section 633 does not extend to the company itself.

Section 633 of the Companies Act, 1956 was explained as a protective provision for officers of a company who have acted honestly and reasonably in the circumstances. The Delhi HC noted that the petitioning officers had taken legal advice before and after the 1988 amendment, proceeded on a bona fide understanding of the law, and exercised ordinary prudence; on that basis, they were granted relief from liability, subject to cooperation with the authorities. The Court also clarified that section 633 does not extend to the company as a juristic person, so the company's request for relief was rejected.

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Issues: (i) Whether the petitioners, as officers of the company, had acted honestly and reasonably so as to merit relief from liability under section 633(2) of the Companies Act, 1956. (ii) Whether the company itself could claim protection under section 633 of the Companies Act, 1956.

Issue (i): Whether the petitioners, as officers of the company, had acted honestly and reasonably so as to merit relief from liability under section 633(2) of the Companies Act, 1956.

Analysis: The petitioners had obtained legal opinion both before and after the 1988 amendment, had proceeded on a bona fide understanding of the statutory position, and had acted with ordinary prudence in the conduct of the company's affairs. The apprehension of proceedings was not baseless, and the question under section 633(2) was whether the officers had acted honestly and reasonably in the circumstances. The Court declined to pronounce on the merits of the disputed construction of section 370 and confined itself to the officers' conduct and the likelihood of proceedings.

Conclusion: The petitioners were held to have acted honestly and reasonably and were relieved from liability in any action that may be brought against them, subject to cooperation with the authorities.

Issue (ii): Whether the company itself could claim protection under section 633 of the Companies Act, 1956.

Analysis: The protection contemplated by section 633 is confined to officers of the company and does not extend to the company as a juristic person. Accordingly, the relief sought on behalf of the company could not be granted.

Conclusion: The company was held not entitled to relief under section 633 and the petition was dismissed to that extent.

Final Conclusion: Relief was granted only to the petitioning officers, while the company's request was rejected, leaving the matter disposed of partly in their favour.

Ratio Decidendi: Relief under section 633 of the Companies Act, 1956 is available only to officers who have acted honestly and reasonably, and not to the company itself.

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