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of <h1>Court dismisses company petition for relief under Companies Act due to share certificate default.</h1> The Court dismissed the company petition seeking relief from criminal liability under Section 633(2) of the Companies Act due to a default in delivering ... - Issues:Petition under Section 633(2) of the Companies Act for relieving petitioners from criminal liability; Default in delivering share certificates within the prescribed period; Maintainability of the petition despite criminal proceedings initiated by the Registrar of Companies; Interpretation of Section 633 of the Companies Act regarding the power to excuse an officer from liability; Applicability of the judgments cited by the counsel in support of the petition.Analysis:The petitioners, who were Directors and officers of a company, sought relief from criminal liability under Section 633(2) of the Companies Act due to a default in delivering share certificates within the prescribed period. The petitioners argued that they acted honestly and reasonably, attributing the delay to established practices and procedures within the company. However, the Court noted the initiation of criminal proceedings by the Registrar of Companies against the petitioners, challenging the maintainability of the petition in light of ongoing legal action.The Court considered the submission that the criminal complaint filed by the Registrar of Companies was beyond the period of limitation, questioning the lawfulness of the process. The counsel for the petitioners argued that despite the criminal proceedings, the petition should be entertained by the Court. The counsel relied on judgments from the Calcutta High Court and the Delhi High Court to support their position, emphasizing the need for relief under Section 633 of the Companies Act.The Court analyzed the provisions of Section 633 of the Companies Act, emphasizing the power of the High Court to excuse an officer from liability in cases of negligence, default, breach of duty, misfeasance, or breach of trust. The Court highlighted that the High Court's jurisdiction to grant relief is based on an officer's apprehension of potential proceedings, not the actual initiation of legal action. The Court concluded that once criminal proceedings are initiated, the competent authority to grant relief under Section 633(1) is the Magistrate handling the case.The Court rejected the argument that the delay in filing the complaint affected the legality of the proceedings, clarifying that Section 633 does not require the formal 'taking cognizance' but encompasses any proceedings related to the alleged offense. The Court dismissed the petition, stating that the petitioners could seek relief before the Metropolitan Magistrate handling the criminal case. The Court cited previous judgments to support its decision, emphasizing the need for timely and appropriate legal recourse in such matters.In conclusion, the Court dismissed the company petition, emphasizing the need for petitioners to seek relief through the appropriate legal channels based on the provisions of the Companies Act. The Court maintained the ad interim orders for a specified period and disposed of related applications accordingly.
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