Prima facie standard at summons stage sustains proceedings against nominee directors; disputed liability reserved for trial.

At the cognizance and summons stage, the court must only determine whether the complaint and material disclose a prima facie case, and it should not conduct a detailed inquiry into disputed facts. The Delhi HC held that prior exoneration by another investigating agency did not bind the court or negate an independent SFIO-based complaint under the Companies Act. Whether the petitioners, as nominee non-executive directors, were liable, including in the light of Section 149(12) of the Companies Act, 2013, was a matter for trial. No ground for interference under Section 482 CrPC was made out, and the summoning order was sustained.

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Issues: Whether the order taking cognizance and issuing summons against the petitioners, who were nominee non-executive directors, called for interference in exercise of inherent jurisdiction under Section 482 of the Code of Criminal Procedure, 1973.

Analysis: The petition challenged the summoning order on the grounds that the petitioners had been exonerated by other investigating agencies, were not in charge of the day-to-day affairs of the company, and that the special court had acted mechanically. The Court held that the stage of taking cognizance requires only a prima facie judicial satisfaction on the basis of the complaint and material placed before the court, and not a detailed evaluation of the merits or of disputed factual questions. It further held that exoneration by one investigating agency does not bind another agency or the court, particularly where the complaint under the Companies Act was founded on an independent SFIO investigation. The Court also noted that the question whether the petitioners were actually liable as non-executive or nominee directors, including in the light of Section 149(12) of the Companies Act, 2013, was a matter for trial and not for interference at the cognizance stage.

Conclusion: No ground for interference was made out. The summoning order was sustained and the challenge under Section 482 of the Code of Criminal Procedure, 1973 failed.

Final Conclusion: The petitioners were left to raise their defences before the trial court at the appropriate stage, and the proceedings against them were permitted to continue.

Ratio Decidendi: At the stage of cognizance and summons, the court is concerned only with whether the materials disclose a prima facie case, and it should not undertake a roving inquiry into disputed facts or treat exoneration by another agency as determinative.

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