TaxTMI 
TaxTMI 
1997 (6) TMI 327
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....director he had issued cheques to various persons and those cheques were returned by the bankers for insufficiency of funds. The payees of the cheques therefore filed complaints before the Magistrate's Courts under section 138 of the Negotiable Instruments Act. Thereafter these petitions have been filed by the petitioner to stay the trial of those complaints and also to transfer those cases for trial to this court. 2. Sri Anil Narendran, who appeared for the petitioner, strongly urged that under section 446 of the Companies Act, 1956 ('the Act') this Court has got jurisdiction to stay the trial of the criminal complaints and also to transfer the same to this Court. In order to understand the scope and ambit of section 446 it is advantage....
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....ed in any other law for the time being in force, be transferred to and disposed of by that Court. (4) Nothing in sub-section (1) or sub-section (3) shall apply to any proceeding pending in appeal before the Supreme Court or a High Court." The learned counsel has cited the following decisions in order to impress upon this court that these criminal complaints are liable to be stayed by this court and if necessary to be tried by this court. Khosla Fans (India) (P.) Ltd., In re [1983] 53 Comp. Cas. 858 (Punj. & Har.), Official Liquidator, R.C. Abrol & Co. (P.) Ltd. v. R.C. Abrol [1977] 47 Comp. Cas. 537 (Delhi) and Harish C. Raskapoor v. Jaferbhai Mohmedbhai Chhatpar [1989] 65 Comp. Cas 163 (Guj.). In the Punjab and Haryana case Khosla Fa....
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.... other offences such as the offences under section 538 or section 541. The High Court also observed that it had power under section 446(3) to transfer a pending complaint before the Magis trate for trial to itself. Thus the Delhi High Court was mainly considering whether the High Court has got any original jurisdiction to take cogni- zance of any offence and to try the same. Therefore I do not think the above ruling is also helpful to the petitioner. 4. In the case before the Gujarat High Court Harish C. Raskapoor's case (supra), the High Court was considering the power of the Court to order stay of proceedings against a company and its directors pending sanction of a scheme and even after sanction before finalisation of the scheme. Whil....
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....ure of the action must be against the property of the company. The proceeding must be for the enforcement of something in the nature of personal right against the assets of the company and not one in vindication of public interest. Unless all the properties and the claims of the creditors of the company are pooled together and brought under the control of the Company Court the assets cannot be conserved and applied in full satisfaction of the creditors equitably. It is the benefit to the creditors that must be the guiding factor in dealing with these cases. Though the word legal proceedings in section 446 is wide enough to embrace, criminal prosecution also, that criminal proceedings must be in relation to the assets of the company. The pro....
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....still think that to come within the scope of this section, the proceeding must be in the nature of an action against the property of the company. To put it some what differently, the proceeding must be for the enforcement of something in the nature of personal right against the assets of the company and not one in vindication of public interest. As pointed out in the Federal Court decision just referred to, the purpose of section 446 of the Companies Act is to subject all creditors to the control of the Court in respect of their actions against the property of the company so that the property may be conserved and applied in the pari passu satisfaction of its liabilities. The winding up court has to see that the administration is carried on ....