Limitation for false statement prosecutions runs from knowledge of the falsity, making delayed complaints time-barred.

Complaints alleging false statements in balance sheets were treated as time-barred because limitation under Section 628 of the Companies Act, 1956 began when the alleged falsity came to the prosecuting authority's knowledge. The inspection date was not stated in the complaints, so the filing dates of the balance sheets were taken as the date of knowledge. As the balance sheets were filed in March 2001 and March 2002, but show-cause notices were issued only in February 2005 and complaints were filed in July 2005, the prosecution was beyond the three-year limitation period. The complaints were therefore liable to be quashed against the petitioner.

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Issues: Whether the complaints for offence under Section 628 of the Companies Act, 1956 were barred by limitation and liable to be quashed.

Analysis: The alleged falsity related to non-disclosure in the balance sheets. For offences involving false statements under Section 628 of the Companies Act, 1956, limitation was held to commence from the date of knowledge of the false statement. In the present case, the inspection date was not stated in the complaints, and the date of filing of the balance sheets was treated as the date of knowledge. Since the balance sheets were filed on 31.03.2001 and 31.03.2002, the knowledge of the alleged irregularities arose in March 2001 and March 2002, whereas the show cause notices were issued only in February 2005 and the complaints were filed in July 2005. The prosecution was therefore beyond the three-year limitation applicable to the offence.

Conclusion: The complaints were barred by limitation and liable to be quashed in respect of the petitioner.

Ratio Decidendi: For prosecutions under Section 628 of the Companies Act, 1956 relating to false statements, limitation begins from the date on which the false statement comes to the knowledge of the prosecuting authority, and a complaint filed beyond the prescribed period is barred.

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