Court validates Companies Act investigation, dismisses jurisdiction challenge. Petitioners must comply with SFIO summons.

The court upheld the validity of the supplementary investigation under Section 212 of the Companies Act, 2013, dismissing the petitioners' challenge on jurisdiction grounds. It ruled that the Companies Act, 2013 applies to ongoing investigations, and the petitioners must comply with the summons issued by the SFIO. The court directed the petitioners to appear before the third respondent for further investigation, while acknowledging their request for essential documents. The Criminal Original Petitions were disposed of with a directive for compliance, and the connected Miscellaneous Petitions were closed.

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Issues Involved:
1. Jurisdiction and validity of supplementary investigation under Section 212 of the Companies Act, 2013.
2. Compliance with summons issued by SFIO under Section 217(8) of the Companies Act, 2013.
3. Applicability of Companies Act, 1956 versus Companies Act, 2013 for ongoing investigations.

Summary:

1. Jurisdiction and Validity of Supplementary Investigation:
The petitioners challenged the show cause notices issued by the SFIO, arguing that the supplementary investigation ordered under Section 212 of the Companies Act, 2013 was without jurisdiction. They contended that as per Section 212(16) of the Act, there is a complete bar on any order of supplementary investigation for a company under winding up. The petitioners argued that the investigation should be governed by the Companies Act, 1956, under which the initial investigation was ordered.

2. Compliance with Summons Issued by SFIO:
The petitioners received multiple summons from SFIO for supplementary investigation but claimed they were not provided with copies of the orders for supplementary investigation. Despite sending replies to each summons, they argued that the summons were repeatedly issued without jurisdiction. The petitioners sought to quash the show cause notices dated 27.01.2021 for non-compliance with the summons, asserting that the summons themselves were illegal.

3. Applicability of Companies Act, 1956 versus Companies Act, 2013:
The respondents argued that the Companies Act, 2013 replaced the Companies Act, 1956, and the provisions of the new Act apply to ongoing investigations. They contended that under Section 465 of the Companies Act, 2013, any action taken under the repealed enactments is deemed to have been done under the corresponding provisions of the new Act. The respondents maintained that the investigation ordered under Section 212 of the Companies Act, 2013 was valid and the petitioners were obligated to comply with the summons.

Court's Observations:
The court noted that the investigation had already been completed, and a final report was filed. The petitioners were summoned under Section 212(4) of the Companies Act, 2013 for further investigation. The court emphasized that the petitioners should comply with the summons issued to them and appear before the third respondent. The court also observed that the petitioners' request for copies of certain orders was not unreasonable and suggested that the third respondent consider furnishing the essential documents if they are not secret.

Conclusion:
The court disposed of the Criminal Original Petitions, directing the petitioners to appear before the third respondent in compliance with the summons without prejudice to their contention regarding the applicability of the Companies Act, 1956. The connected Miscellaneous Petitions were also closed.

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