Unpaid dividend prosecution fails when warrants are timely posted and the complaint is filed beyond the limitation period.

A complaint for failure to transfer unpaid dividend under Section 205A(8) could not be sustained where the dividend was deposited in time and the warrants were posted within the statutory period, because posting to shareholders' registered addresses was treated as sufficient payment for that purpose and unpaid dividend liability arises only when non-payment or non-claim is shown in the statutory sense. The note also states that, for an offence punishable with fine only, the six-month limitation period under Section 468(2)(a) of the Code of Criminal Procedure applied; as the complaint was filed after that period, it was time-barred. On that basis, the proceedings were quashed.

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Issues: (i) Whether the complaint disclosed an offence under Section 205A(8) of the Companies Act, 1956 for failure to transfer unpaid dividend to the special account. (ii) Whether the criminal complaint was barred by limitation under Section 468 of the Code of Criminal Procedure, 1973.

Issue (i): Whether the complaint disclosed an offence under Section 205A(8) of the Companies Act, 1956 for failure to transfer unpaid dividend to the special account.

Analysis: Section 205A(1) applies where a dividend has been declared but has not been paid or claimed within forty-two days. On the facts, the dividend amount was deposited in the bank within time and the dividend warrants were posted within the stipulated period. Once the warrants are posted to the shareholders' registered addresses, payment is treated as complete for the purpose of the provision. Liability for failure to transfer an amount as unpaid dividend arises only when the dividend remains unpaid or unclaimed in the statutory sense, which was not established on the complaint as a whole.

Conclusion: The complaint did not disclose the commission of an offence under Section 205A(8) of the Companies Act, 1956.

Issue (ii): Whether the criminal complaint was barred by limitation under Section 468 of the Code of Criminal Procedure, 1973.

Analysis: The offence alleged was punishable with fine only, so the limitation period was six months under Section 468(2)(a) of the Code of Criminal Procedure, 1973. The inspection was completed on 29-09-1997 and the complaint was filed on 15-04-1998, which was beyond six months. Once the period of limitation commenced, it could not be extended on the facts shown.

Conclusion: The complaint was barred by limitation under Section 468 of the Code of Criminal Procedure, 1973.

Final Conclusion: The proceedings were quashed because the alleged offence was not made out and the prosecution was instituted beyond the permissible limitation period.

Ratio Decidendi: Where dividend warrants are duly posted within the statutory period, the dividend is treated as paid for the purpose of Section 205A, and a prosecution for failure to transfer unpaid dividend cannot be sustained unless non-payment or non-claim is shown within the meaning of the provision; additionally, a complaint for an offence punishable with fine only must be instituted within the limitation period prescribed by Section 468.

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