https://www.taxtmi.com/caselaws?id=790684 A general auditor's observation that the company's internal audit system needed strengthening was treated as an advisory remark, not a reservation, qualification or adverse remark under section 217(3) of the Companies Act, 1956, so no offence under section 217(5) was disclosed. The complaint was also held time-barred because the alleged offence carried imprisonment up to six months and no valid sanction or exclusion of time under the Code of Criminal Procedure was established. The cognizance and summoning orders were further found to show no application of mind, as they did not reflect scrutiny of whether the complaint disclosed any offence. The criminal proceedings were therefore unsustainable and were quashed. en-us Mon, 27 Apr 2026 00:00:00 +0530 Wed, 29 Apr 2026 08:16:31 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=790684 A general auditor's observation that the company's internal audit system needed strengthening was treated as an advisory remark, not a reservation, qualification or adverse remark under section 217(3) of the Companies Act, 1956, so no offence under section 217(5) was disclosed. The complaint was also held time-barred because the alleged offence carried imprisonment up to six months and no valid sanction or exclusion of time under the Code of Criminal Procedure was established. The cognizance and summoning orders were further found to show no application of mind, as they did not reflect scrutiny of whether the complaint disclosed any offence. The criminal proceedings were therefore unsustainable and were quashed. Case-Laws Companies Law Mon, 27 Apr 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=790684