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United Savings and Finance Co. Pvt. Ltd. and anr. Vs. the Deputy Chief Officer, Reserve Bank of India - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtKolkata High Court
Decided On
Judge
Reported in1980CriLJ607
AppellantUnited Savings and Finance Co. Pvt. Ltd. and anr.
RespondentThe Deputy Chief Officer, Reserve Bank of India
Cases ReferredState of Bihar v. Deokaran
Excerpt:
- .....deposits, to control and regulate different activities of such institutions as contained in the bank's notification no. dnbc. 21/dg(s)-73 dated august 23, 1973. in terms of paragraph 11 of the said directions, the petitioner company, as a non-banking institution receiving deposits, is bound to submit to the bank its statutory return furnishing the information specified in the schedule thereto with reference to its position as on the dates specified therein, viz. twice a year showing the position as on the 31st day of march and 30th day of september each year, irrespective of the financial year of the company. the returns are required to be submitted by the 30th june and 31st december respectively of that year. the company failed to submit such returns for which all the accused persons.....
Judgment:
ORDER

Monoj Kumar Mukerjee, J.

1. These two Rules are for quashing the proceedings of two cases initiated against the petitioners and others under Section 58B(2) of the Reserve Bank of India Act, 1934 (hereinafter referred to as the Act) in the Court of the Sub-divisional Judicial Magistrate Ranaghat, on complaints filed by the Deputy Chief Officer, Department of Non-Banking Companies, Reserve Bank of India.

2. The material allegations in the complaints are as follows:

The accused No. 1 is a limited company within the meaning of the Companies Act, 1956 and the other three accused persons are its Directors and are responsible for all the acts and affairs of the business and accounts of the company. In exercise of its powers under Sections 45J and 45K of the Act, the Reserve Bank of India, (hereinafter referred to as the Bank) issued certain directions to Non-Banking institutions, receiving deposits, to control and regulate different activities of such institutions as contained in the Bank's Notification No. DNBC. 21/DG(S)-73 dated August 23, 1973. In terms of paragraph 11 of the said directions, the petitioner company, as a Non-Banking institution receiving deposits, is bound to submit to the Bank its statutory return furnishing the information specified in the schedule thereto with reference to its position as on the dates specified therein, viz. twice a year showing the position as on the 31st day of March and 30th day of September each year, irrespective of the financial year of the company. The returns are required to be submitted by the 30th June and 31st December respectively of that year. The company failed to submit such returns for which all the accused persons are liable for prosecution under S., 58B(2) read with Section 58C of the Act. While one complaint is for returns as on March 31, 1976 and September 30, 1976, the other one is for returns as on March 31, 1977 and September 30, 1977.

3. After entering appearance in connection with the above two cases in obedience to the process issued, the petitioner-company and one of its Directors moved this Court and obtained the present Rules.

4. Two points were canvassed by the petitioners in support of the Rules. It was firstly contended that as the complainant, the Deputy Chief Officer of the Bank, was not duly authorised by the Bank under Section 58E of the Act to file the complaints, the Sub-divisional Judicial Magistrate erred in law in taking cognisance thereupon, f he second contention was that the cognisance was barred by limitation under Section 468 of the Code of Criminal Procedure. In refuting the above two contentions, it was submitted that the complainant was generally authorised in writing, by the Bank, to file complaints under Section 58B of the Act and as such the cognisance was legal and valid. It was next submitted that the offence under Section 58B(2) was a continuing one and in view of the provisions of Section 472 of the Code of Criminal Procedure the cognisance was not barred by limitation.

5. To answer the first point raised by the petitioners it will be necessary to refer to Section 58E(1) of the Act which reads as follows;-

No Court shall take cognizance of any offence punishable under this Act except upon a complaint in writing made by an officer of the Bank, generally or specially authorised in writing in this behalf by the Bank, and no court other than that of a Metropolitan Magistrate or a Judicial Magistrate of the First Class or a court superior thereto shall try any such offence.

6. To prove his authority to file the complaints, the complainant has stated in the complaints that, by an Order No. 5/ 1975 dated 6th of October, 1975 issued by the Governor of the Reserve Bank of India, which was published in the Gazette of India, Part III, Section 4 dated the 8th of November, 1975 the Reserve Bank of India delegated the powers to make a complaint, as referred to in Section 58E of the Reserve Bank of India Act, 1934, for an offence punishable under Section 58B(2) and other provisions of the Act relating to non-banking institutions to the complainant and other officers of the Bank. At the time of hearing of these Rules, a copy of the said Gazette notification was filed. It appears from the said notification that any officer in the department of Non-Banking Companies, not below the rank of an officer in Class I Grade I, has been empowered to make a complaint in writing as referred to in Section 58E of the Reserve Bank of India Act, 1934 for an offence, punishable under Section 58B of the Act. It is not in dispute that the complainant answers to the description of the officer referred to in the said notification. The contention of Mr. Sarkar, who appeared on behalf of the petitioners, however, was that the authority given under the above notification did not empower the complainant to file a complaint in respect of an offence which was committed after the date of issuance of the notification. According to Mr. Sarkar, for each complaint to be made under the Act the Governor of the Bank himself has to be satisfied about its contents and only on such satisfaction he has to give a special authorisation to one of the officers mentioned in the notification to file complaint. In support of his contention Mr. Sarkar relied upon the judgment of the Privy Council in the case of Gokulchand Dwarkadas v. The King reported in AIR 1948 PC 82.

7. In view of the plain language of Section 58E of the Act and the notification in question I find no merit in the contention of Mr. Sarkar. Section 58E empowers the Bank to generally or specially authorise an officer of the Bank to file a complaint. The notification unmistakably shows that the officers of the rank of the complainant have been generally authorised to file complaints under Section 58B of the Act. Once so authorised, the concerned officer is entitled to decide of his own whether a complaint should be filed against any person for breach of the provisions of the Act. The words 'generally...authorised in writing' are wide enough to entitle the Bank to empower an officer to file a complaint in respect of offences already committed or to be committed in future and it does not limit its scope to complaints to be filed in respect of offences already committed or in respect of a particular offence. Any other interpretation to the word 'generally' would be doing violence to its plain meaning. The decision referred to by Mr. Sarkar has no manner of application to the instant case as the said decision is only an authority for the proposition that all facts must appear in a sanction for prosecution or it must be proved that they were placed before the sanctioning authority.

8. As regards the second contention of Mr. Sarkar, Mr. Roy Chowdhury, appearing for the complainant fairly conceded that if the offence under Section 58B(2) was not a continuing one, the cognisance of the offences in the instant case which related to non-filing of returns as on 31st March, 1976, 30th September, 1976 and 31st March, 1977 was barred by limitation. As stated earlier, Mr. Roy Chowdhury's contention was that the offence under Section 58B was a continuing offence and the cognizance in neither of the two cases was barred by limitation. Referring to Section 58B(2), which reads as follows:

If any person fails to produce any book, account or other document or to furnish any statement information or particulars which, under this Act or any order, regulation or direction made or given thereunder, it is his duty to produce or furnish or to answer any question put to him in pursuance of the provisions of this Act or of any order, regulation or direction made or given thereunder, he shall be punishable with fine which may extend to two thousand rupees in respect of each offence and if he persists in such failure or refusal, with further fine which may extend to one thousand rupees for every day, after the first during which the offence continues.

Mr. Roy Choudhury submitted that the last few lines of the above section clearly indicate that the offence in question continued so long as the obligation thereunder was not fulfilled and consequently under Section 472 of the Code of Criminal Procedure a fresh period of limitation would begin to run at every moment of the time during which the offence so continued. As against the above contention of Mr. Roy Chowdhury, Mr. Sarkar submitted that on the alleged failure of the company to submit the return within the stipulated period, the offence was complete and was not a continuing one so as to attract the provisions of Section 472 of the Code. In support of their respective contentions, both of them relied upon the decision of the Supreme Court in State of Bihar v. Deokaran reported in : 1973CriLJ347 . As the above decision was interpreted in their own ways by the learned Advocates appearing for the parties it will be necessary to refer to the same in some details.

9. Read in the context of Section 79 of the Mines Act, whether the offence under Section 66 thereof, which provides that any person omitting, inter alia, to furnish any return, notice etc. in the prescribed form or manner or at or within the prescribed time required by or under the Act to be made or furnished shall be punishable with fine which may extend to rupees 1,000/-, was a continuing offence or not, was the question which came up for consideration before the Supreme Court in that case. Section 79 of the Act lays down that no Court shall take cognisance of any offence under that Act unless a complaint thereof has been made within six months from the date on which the offence is alleged to have been committed or within six months from the date from which the alleged commission of offence came to the knowledge of the inspector whichever is later, and the explanation thereto provides that if the offence in question is a continuing one the period of limitation shall be computed with reference to every point of time during which the said offence continues. In deciding whether the offence under Section 66 was covered by the substantive part of Section 79 or by the exception thereto the Court observed as follows:

Continuing offence is one which is susceptible of continuance and is distinguishable from the one which is committed once for and for all. It is one of those offences which arises out of a failure to obey or comply with a rule or its requirement and which involves a penalty, the liability for which continues until the rule or its requirement is obeyed or complied with. On every occasion that such disobedience or non-compliance occurs and recurs, there is the offence committed. The distinction between the two kinds of offence is between the act or omission which constitutes an offence once for all and an act or omission which continues and therefore constitutes a fresh offence every time or occasion on which it continues. In the case of a continuing offence there is thus the ingredient of continuance of the offence which is absent in the case of an offence which takes place when an act or omission is committed once and for all.

10. To illustrate the above principle the Supreme Court discussed the facts of certain cases and proceeded to consider the language of Section 66 of the Mines Act in that context and observed as follows:

Regn. 3 read with Section 66 of the Mines Act makes failure to furnish annual returns for the preceding year by the 21st of January of the succeeding year an offence. The language of Regn. 3 clearly indicates that an owner, manager etc. of a mine would be liable to the penalty if he were to commit an infringement of the Regulation and that infringement consists in the failure to furnish return on or before January 21 of succeeding year. The infringement, therefore, occurs on January 21 of the relevant year and is complete on the owner failing to furnish the annual returns by that day. The Regulation does not lay down that the owner, manager etc. of the mine concerned would be guilty of an offence if he continues to carry on the mine without furnishing the returns or that the offence continues until the requirement of Regn. 3 is complied with. In other words Regn. 3 does not render a continued disobedience or non-compliance of it an offence. As in the case of a construction of a wall in violation of a rule or a bye-law of a local body the offence would be complete once and for all as soon as such construction is made a default occurs in furnishing the returns by the prescribed date. There is nothing in Regn. 3 or in any other provision in the Act or the Regulations which renders the continued non-compliance an offence until its requirement is carried out.

11. Reading the language of Section 58B(2) of the Act in the light of the above judgment I have no hesitation in holding that the offence described therein is a continuing offence and this has been made amply clear by the words 'and if he persists in such failure or refusal with further fine which may extend to one thousand rupees for every day, after the first, during which the offence continues.'

12. The express language of the above section goes to indicate that failure or refusal to comply with the term of the said section creates an offence and continues to be an offence so long as such failure or refusal persists. In other words, so long as the requirement of the said section is not complied with the offence continues. But for the above quoted words in Section 58B(2), Sri Sarkar, relying on the above judgment, might have successfully argued that. the offence was not a continuing one, but then, as, unlike the provision of Section 69 of the Mines Act, Section 58B(2) expressly makes a provision rendering the offence in question a continuing one, Mr. Sarkar's contention must fail.

13. In the result, the applications fail and the Rules are discharged.


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