Statement of affairs liability avoided where former director had exited management and lacked access to company records.

Liability for failure to file a statement of affairs under Sections 454(5) and 454(5A) of the Companies Act, 1956 could not be fastened on a person who had ceased to participate in the company's management well before the notice was issued. The record showed that he had retired as director, later resigned as vice-chairman, and had no access to the books of the company in liquidation during the relevant period, while other respondents were in charge of the company's affairs. On those facts, the obligation to file the statement of affairs did not attach to him, and he was not liable for punishment.

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Issues: Whether the respondent was liable to be punished for failure to file the statement of affairs under Section 454(5) and Section 454(5A) of the Companies Act, 1956.

Analysis: The respondent had ceased to be involved in the management and affairs of the company long before the notice to file the statement of affairs was issued. The record showed that he had retired as director, later resigned as vice-chairman, and had no access to the books of the company in liquidation during the relevant period. The material on record indicated that the other respondents were in charge of the affairs of the company during the relevant period, and therefore the obligation to file the statement of affairs could not be fastened on the respondent.

Conclusion: The respondent was not liable for punishment under Section 454(5) and Section 454(5A) of the Companies Act, 1956, and was discharged.

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