TaxTMI 
TaxTMI 
2008 (9) TMI 1049
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....ditional Sessions Judge, Tis Hazari Courts, Delhi, be quashed. The petitioner also seeks quashing of the order passed on 24.8.2006, by the Ld. Additional Sessions judge, dismissing his application for discharge. The facts in a nut shell are as follows:- 2. The petitioner, Mr. Jagdish Saran Agarwal, was one of the directors of Yojna Agro Forestry Limited. This company was engaged in raising money from the general public and operating Collective Investment Schemes. On 18.11.1997, the Government of India issued a notification that such schemes were governed by the SEBI Act 1992. On 15.10.1999, the Securities and Exchange Board of India (SEBI), notified the Securities and Exchange Board of India (Collective Investment Schemes) Regulations 19....
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....d not comply with the said Regulations and from this, it is clear that the Accused No.1 is intentionally and with dishonest intentions evading the repayment of the amount collected by it from the investors." The specific allegation against the petitioner and the other accused, all of whom are described as directors of the said company is as follows; "The Accused No.2 to 5 are the Directors of the Accused No.1 and as such persons in charge of and responsible to the Accused No.1 for the conduct of its business and are liable for the violation of the Accused No.1 as provided under Section 27 of Securities and Exchange Board of India Act, 1992". 5. Thereafter, on 15.4.2005, the petitioner moved the Trial Court under Section 227, ....
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....rom the directorship in the year 1998 has been admitted. Thus, it is contended by the counsel for the petitioner that the petitioner cannot be made liable for any offence under Section 27 of the SEBI Act, which was allegedly committed by the Company after he had admittedly ceased to be its director. 7. Per contra the counsel for respondent No.1 contends that whether the petitioner was a director or not at the relevant time is a disputed question of fact which cannot be decided by this Court in its exercise under Section 482 of Cr.P.C and can only be decided during trial. For this he has relied upon a number of decisions of the Supreme Court and of this Court, inter alia, Raj Lakshmi Mills Vs. Shakti Bhakoo (2002) 8 SCC 236; S.M. Dutta Vs....
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....not the Directors of the company at the time of the commission of the offence, this Court quashed the criminal complaint against the petitioners. 10. In the case at hand, it appears that the complaint was filed because the company failed to comply with the direction of the first respondent within the time granted, which expired on 7.12.2000. Therefore, the cause of action can only be said to have arisen against the company on 7.1.2001 and not before. 11. To my mind, under the circumstances of this case, the question whether the petitioner was a Director of the said company at the relevant time is not something that cannot be decided without evidence being recorded at the trial. In Virender Kumar Singh & Anr. Vs. Securities And Exchang....
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....held that: "10. The section does not confer any new powers on the High Court. It only saves the inherent power which the court possessed before the enactment of the Code. It envisages three circumstances under which the inherent jurisdiction may be exercised, namely: (i) to give effect to an order under the Code, (ii) to prevent abuse of the process of court, and (iii) to otherwise secure the ends of justice. It is neither possible nor desirable to lay down any inflexible rule which would govern the exercise of inherent jurisdiction....... While exercising powers under the section, the court does not function as a court of appeal or revision. Inherent jurisdiction under the section though wide has to be exercised sparingly, careful....