TaxTMI 
TaxTMI 
2018 (1) TMI 875
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....he case of the appellant is that in the Financial Year 2011-12 the management of the company faced complications and difficulties arising out of financial irregularities which surfaced in January 2012 committed by the erstwhile senior Executive, namely, Subhinder Singh Prem, Managing Director and Vishnu Bhagat, Chief Operating Officer whose services were terminated on 26.3.2012. It is stated that the said Managing Director Subhinder Singh had indulged in large scale financial irregularities. The company appointed a Financial Expert, Ernst & Young Pvt. Ltd. Co. to carry out internal investigation. Investigations have shown serious irregularities in the account. FIR No.99/2012 dated 21.5.2012 has been lodged. Appellant No.2 has now taken o....
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....he appellants No.2 to 5 were not arrayed as accused in the complaint by SFIO. However, summons were issued only to appellant No.2. This issue of summons was challenged before the higher court and the said order issuing summons is said to have been stayed. 3. Hence, the present petition was filed under section 621A of the Companies Act before the Company Law Board for seeking necessary relief of compounding of offences under section 159 of the Act for late filing of Annual Return for the Financial Year ending 31.3.2012. The Company Law Board by its impugned order noted that there has been a financial scam in the appellant company and investigations conducted by officials of SFIO have reported the volume and nature of the financial scam. T....
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....Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), any offence punishable under this Act (whether committed by a company or any officer thereof), not being an offence punishable with imprisonment only, or with imprisonment and also with fine, may, either before or after the institution of any prosecution, be compounded by the Central Government on payment or credit, by the company or the officer, as the case may be, to the Central Government of such sums as that Government may prescribe. Provided that the sum prescribed shall not, in any case, exceed the maximum amount of the fine which may be imposed for the offence so compounded: Provided further that in prescribing the sum required t....
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....n of the matter who can accord permission to compound the offence. In any view of the matter, according to the learned Counsel, the Company Law Board has to seek permission of the court and it cannot compound the offence without such permission. This line of reasoning does not commend us. Both Sub-section (1) and Sub-section (7) of Section 621A of the Act start with a non-obstante clause. As is well known, a non-obstante clause is used as a legislative device to give the enacting part of the section, in case of conflict, an overriding effect over the provisions of the Act mentioned in the non-obstante clause. 17. Ordinarily, the offence is compounded under the provisions of the Code of Criminal Procedure and the power to accord per....