Judgment:
A. Gopal Reddy, J.
1. This is a petition filed under Section 482 of the Code of Criminal Procedure, 1973, to quash the proceedings in C. C. No. 26 of 1999, on the file of the special judge for Economic Offences, Hyderabad, against the petitioners for the offences under Section 73(2B) of the Companies Act, 1956, for failure to comply with the provisions of Sub-section (2) thereof.
2. It is not disputed that the first petitioner is the company and the second petitioner is the managing director and the third petitioner is the executive director of the first petitioner-company. The first petitioner issued a prospectus to the public offering 52 lakhs equity shares of Rs. 10 each and it was opened to the public on January 27, 1993, and the said issue was closed on February 1, 1993. While so, one Ramprasad Gupta and Arun Kumar made a complaint on April 15, 1998, and April 13, 1998, respectively to the Hyderabad Stock Exchange, who in turn forwarded the same to the Registrar of Companies for taking legal action. In the said complaint, the above persons stated that they have applied for 100 equity shares of Rs. 10 each during the public issue made by the accused in the year 1993, but no shares were allotted and as such, the company ought to have refunded the share application of Rs. 1,000 and Rs. 2,000 to them. Hence, on July 8, 1998, the first respondent issued a show-cause notice to the petitioners to show cause why action should not be initiated under Section 73(2B) of the Companies Act, 1956. As the petitioners did not respond to the said notice, the petitioners were prosecuted for the alleged offences. Questioning the same, the present petition is filed.
3. Learned Counsel for the petitioners contends that as the said public issue was closed on February 1, 1993, the complaint made by the above persons on April 15, 1998 and April 13, 1998, is barred by limitation as per Section 468(2) of the Code of Criminal Procedure and hence, the proceedings can be quashed.
4. The said submission has to be considered in the light of the provisions of the Companies Act. Section 621 of the Companies Act prohibits taking cognizance of the offence, which is alleged to have been committed by any company or any officer thereof, except on the complaint in writing of the Registrar, or of a shareholder of the company, or of a person authorized by the Central Government in that behalf.
5. In view of the provisions of the Companies Act, the subscribers can only make a complaint to the stock exchange where they have subscribed the equity shares and in turn, the stock exchange informs the same to the Registrar of Companies-first respondent-who can initiate the prosecution for violations. In the present case on hand, the offence committed by the petitioners had come to knowledge of the first respondent-complainant for the first time on July 1, 1998, when the complaint was received from Hyderabad Stock Exchange. As per Section 469(1)(b) of the Criminal Procedure Code, the period of limitation would commence from the day on which such offence comes to the knowledge of prosecuting agency.
6. In view of the foregoing discussion, the submissions made by learned Counsel for the petitioners that the complaint is barred by limitation cannot be accepted as the offence had come to the knowledge of the first respondent on July 1, 1998 and soon after having knowledge of the said offence, prosecution was launched against the petitioners. Therefore, proceedings in C. C. No. 26 of 1999, cannot be quashed on the ground that launching of prosecution is barred by limitation.
7. Accordingly, the criminal petition is dismissed.