TaxTMI 
TaxTMI 
2019 (12) TMI 192
X X X X Extracts X X X X
X X X X Extracts X X X X
....nder section 11 of the SEBI Act with the following observations:- (a) DSQ cancels this acquisition of Fortuna Technologies being done on swap basis after following the procedure laid down under the Companies Act. (a copy of this order has been separately sent to Dept. of Company Affairs to ensure compliance by the company) (b) DSQ is prohibited from accessing capital market for a period of one year of completion of investigation and action thereupon whichever is later. (c) Mr Dinesh Dalmia is debarred from dealing in securities for a period of one year or completion of investigation and action thereupon whichever is later. These actions are without prejudice to any further action(s) which may be considered on the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....egulations thereon. 5.Under these circumstances, the 1st respondent herein had filed Company Application No.115 of 2002 while the 2nd respondent herein had filed Company Application No.116 of 2002 under 621A of the Companies Act, 1956 read with Section 629A and for sought composition offences under Sections 81(1), 75 and 150 of the Companies Act, 1956. 6.By the impugned order dated 29.11.2002, the Company Law Board has passed the order with the following observations:- 6.I have considered the application, submissions of Counsel and Authorised Representative of the applicants, Report of the Registrar of Companies, Tamil Nadu, Chennai, contentions of the SEBI and the affidavit dated 06.11.2002 filed on behalf of the applicants.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nly) by 31.12.2002. The second applicant shall pay the compounding fee from his personal account. C.A.No.208/621A/SRB/2002 The Company shall pay Rs. 1,00,000/- (Rupees one lakh only) and the second applicant shall pay Rs. 75,000/- (Rupees Seventy Five Thousand Only) by 31.12.2002. The second applicant shall pay the compounding fee from his personal account. 7.Pursuant to the Order of this Bench mentioned here-in-above, the applicants have lodged demand drafts for a total sum of Rs. 10,25,000/- (Rupees Ten Lakh and Twenty Five Thousand only) on 11.11.2002. As the offences have been compounded and composition fees have been remitted by the applicants, a copy of this Order be sent to the Registrar of Companies, Tamil....
X X X X Extracts X X X X
X X X X Extracts X X X X
....owed. 12.The respondents have settled disputes under the Companies Act, 1956 alone. By settling the dispute under Section 621-A of the said Act, the machinery provided to the appellant under the SEBI Act, 1992 to prosecute respondents for any violation of the said Act and regulations made thereof has not been stifled in any manner. 13.Section 621-A of the companies Act, 1956 as stood at the relevant time and relevant for our purpose reads as follows:- "621-A. Composition of certain offences. (1) 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 impri....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ution, no prosecution shall be instituted in relation to such offence, either by the Registrar or by any shareholder of the company or by any person authorised by the Central Government against the offender in relation to whom the offence is so compounded. (d) Where the composition of any offence is made after the institution of any prosecution, such composition shall be brought by the Registrar in writing, to the notice of the Court in which the prosecution is pending and on such notice of the composition of the offence being given, the company or its officer in relation to whom the offence is so compounded shall be discharged. *** (7) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r after the institution of any prosecution whereas the criminal court has no power to accord permission for composition of an offence before the institution of the proceeding. The legislature in its wisdom has not put the rider of prior permission of the court before compounding the offence by the Company Law Board and in case the contention of the appellant is accepted, same would amount to addition of the words "with the prior permission of the court" in the Act, which is not permissible. 15.The power of compounding of offences by the Company Law Board under Section 621-A of the Companies Act, 1956 as it stood could be exercised only in relation to any offences punishable under the said Act either before or after the institution of any....