P. Jyothimani, J.
1. This company petition is filed under Section 633(2) of the Companies Act, 1956, praying to relieve the petitioner wholly or partly from the liabilities as shown in the show-cause notice dated July 23, 2005, issued by the respondent-the Registrar of Companies.
2. The petitioner was one of the directors of Logix Electronics P. Ltd., a company registered under the Companies Act, 1956, having the authorised share capital as on March 31, 1999, of Rs. 5 lakhs divided into 50,000 equity shares of Rs. 10 each.
3. The main object of the company is to manufacture, assemble, erect, install, purchase, import, export, equip, sell, etc., the micro processor based process control instruments, digital analog systems and industrial automation, apart from designing, developing, engineering, altering, etc., hardware, software, process control instrumentation and also to act as consultant and advisor on process control instrumentation and industrial automation and to render organisation development services, recruitment development, etc.
4. The company was incorporated in the year 1995 and the petitioner who was the first director is holding 13,750 equity shares of Rs. 10 each. According to the petitioner, the other director Mr. S. Venkataramanan with whom the petitioner jointly started the company was in fact, managing the company since the beginning. Due to some dispute which arose between them, all the books and papers of the company were kept in the registered office, which is the residence of the said Mr. S. Venkataramanan and therefore, the petitioner had no access to the books, records and papers of the company.
5. It is stated that the petitioner has filed a petition under Sections 397 and 398 of the Companies Act, 1956, against the said Mr. S. Venkataramanan before the Company Law Board, which was dismissed on December 16, 2002, against which the petitioner has filed appeal in C.M.A. No. 668 of 2003, which is pending before this court. Therefore, according to the petitioner, the balance-sheet of the company could not be finalised after the financial year 1998-99 and no annual general meeting of the company could be held after the last meeting which was held on January 31, 2000.
6. Since the accounts and other books are under the custody of Mr. S. Venkataramanan, the accounts could not be finalised by the petitioner. Therefore, by letter dated September 5, 2002, the petitioner has informed the respondent that due to the abovesaid reason, the balance-sheet and annual returns could not be filed. Similarly, by letter dated November 30, 2000, the Assistant Director of Income-tax, Company Circle-I, Chennai, was informed of the reason for not filing income-tax return.
7. The respondent has issued a show-cause notice dated July 23, 2005, to the petitioner as to why action should not be taken for prosecuting him under Sections 162, 168 and 220(3) of the Companies Act, 1956 (in short, 'the Act'), for contravention of Sections 159, 166 and 220, respectively, of the Act in respect of the financial years ended on March 31, 2002, March 31, 2003 and March 31, 2004. As the petitioner apprehends that he may be arrayed as accused, he has filed the present petition under Section 633(2) of the Act to relieve him from the obligations as imposed in the show-cause notice.
8. The offences made out in the show-cause notice are compoundable under Section 621A(1) of the Companies Act, provided the offences are brought to an end. Due to the reason that the petitioner has no control over any of the documents of the company, the offences under Section 166 for non-holding of annual general meeting and under Section 222 for nonfiling of balance-sheet cannot be compounded. According to the petitioner, he has acted honestly and reasonably and therefore, he should be excused since he is unable to discharge his functions as director.
9. It is the case of the respondent in the counter affidavit that the filing of annual returns within prescribed time is mandatory duty even if the annual general meeting is not called for or not held and the said offence punishable under Section 168 of the Companies Act is a continuing offence. Like that, the non-filing of balance-sheet is also punishable and continuing offence. Therefore, according to the respondent, based on the categorical admission by the petitioner for non-compliance of the obligations imposed under the said provision from 1998-99 onwards, the offence continues attracting the penalty of Rs. 500 for everyday, during which the default continues.
10. Likewise, for non-convening of annual general meeting, under Section 168 of the Act, even if the company has no managing director or a whole-time director, every director is liable for the offence. In the absence of any managing director or a whole-time director, since the company was having only two directors, viz., the petitioner and Mr. S. Venkataramanan, they are liable as per Section 5 of the Act as 'officer who is in default'. In spite of show-cause notice, the petitioner has not filed any return or balance-sheet and therefore, according to the respondent, the petitioner has no locus standi to claim relief under Section 633 of the Act. The non-filing of balance-sheet and annual returns is sufficient to prove that the petitioner has not acted honestly and reasonably.
11. The contention of learned Counsel for the petitioner in support of the petition filed under Section 633 of the Companies Act is that, as the petitioner has no access to the registered office of the company and all the books and papers of the company are at the premises of the registered office of the company, which is also the residence of Mr. S. Venkataramanan, about which there cannot be any dispute because, the petitioner has already filed necessary petition before the Company Law Board against the other director Mr. S. Venkataramanan and ultimately, the matter is pending before this Court and therefore, the petitioner had no chance of having any access to the records of the company including the accounts and other papers and various communications to the authorities and also letters by the petitioner to the said Mr. S. Venkataramanan which would show that the company's books of account were in the custody of Mr. S. Venkataramanan as admitted by the said Mr. S. Venkataramanan himself in the counter affidavit filed by him before the Company Law Board in the petition filed under Sections 397 and 398 of the Companies Act and therefore, there is no dishonest intention on the part of the petitioner and therefore, the petitioner is entitled to the relief under Section 633(2) of the Companies Act. He would also insist that the petition under Section 397 was filed even in the year 2002 specifically stating that the petitioner was denied access to the records including the accounts of the company, whereas the show-cause notice proceeds as if the petitioner is liable for 2001-02, 2002-03 and also for 2003-04.
12. On the other hand, it is the contention of the learned Central Government Standing Counsel, appearing for the Registrar of Companies that when, in the petition filed under Section 397 of the Companies Act, the petitioner admitted that he has secured stock value approximately for Rs. 2.62 lakhs, and even assuming that the said Mr. S. Venkataramanan has removed the stock and assets worth Rs. 51.73 lakhs, on the basis of candid admission by the petitioner that he and the said Venkataramanan had removed a part of the stock, it cannot be termed that the petitioner has been honest and reasonable. It is also his submission that the petitioner along with his wife being the other shareholder is having 50 per cent, of shares in the company while the said Mr. S. Venkataramanan along with his wife is having the remaining 50 per cent, of shares and hence, nothing prevented the petitioner from calling for meeting and in the absence of any steps taken by the petitioner to call for meeting, it cannot be said that the petitioner has been honest. It is his submission that unless and until the continuous offence comes to an end, Section 633 cannot be made applicable. He also submits that in the circumstances, the Company Law Board has dismissed the petition filed under Section 397 of the Act from which it should be presumed that the petitioner was not having honest intention. He would further submit that the petitioner is an 'officer who is in default' as per Section 5 of the Companies Act and the petitioner as a director had the right to call for annual general meeting and also to approach the Government for convening such meetings, when the other director was not co-operating. He would rely upon the judgment in S.S. Sahni v. Registrar of Companies , to substantiate his contention that want of account books is not a defence for non-convening the annual general meeting.
13. I have heard learned Counsel for the petitioner and learned Central Government Standing Counsel appearing for the respondent.
14. The admitted fact in this case is that the statutory obligations which are imposed on the company under Sections 159, 166 and 220 of the Act have not been complied with from 2001-02. Section 159 of the Companies Act which relates to the annual return to be filed by the company having a share capital obligates every company to file return with the Registrar containing various particulars regarding the registered office, register of its members, etc., within 60 days from the date on which each of the annual general meetings referred under Section 166 is held and return is to be filed in the form prescribed under Part I of Schedule V. For non-compliance of the said statutory obligation imposed under Section 159, Section 162 of the Act contemplates the punishment of fine on the company and every officer of the company who is in default. The said Section 162 is as follows:
Section 162. Penalty and interpretation.-(1) If a company fails to comply with any of the provisions contained in Section 159, 160 or 161, the company, and every officer of the company who is in default, shall be punishable with fine which may extend to five hundred rupees for every day during which the default continues.
(2) For the purposes of this Section and Sections 159, 160 and 161, the expressions 'officer7 and 'director' shall include any person in accordance with whose directions or instructions the board of directors of the company is accustomed to act.
15. Likewise, Section 166 of the Act contemplates the obligation that every company to hold its annual general meeting in each year in addition to any other meetings, with the procedure to be followed for the purpose of calling for such meetings. For non-compliance of the said statutory obligation under Section 166 of the Act, penalty is imposed under Section 168 of the Act on the company and every officer of the company who is in default and the said Section 168 is as follows:
Section 168. Penalty for default in complying with Section 166 or 167.- If default is made in holding a meeting of the company in accordance with Section 166, or in complying with any directions of the Tribunal or the Central Government, as the case may be, under Sub-section (1) of Section 167, the company, and every officer of the company who is in default shall be punishable with fine which may extend to fifty thousand rupees and in the case of a continuing default, with a further fine which may extend to two thousand five hundred rupees for every day after the first during which such, default continues.
16. Further, under Section 220 of the Act, after the balance-sheet and profit and loss account are laid before the company at an annual general meeting, three copies of the balance-sheet and profit and loss account signed by the managing director shall be filed with the Registrar. The non-compliance of the same would result in punishment of the company and every officer of the company who is in default, like the punishment provided under Section 162 of the Act as stated above. Section 220 of the Act is as follows:
Section 220. Three copies of balance-sheet, etc., to be filed with Registrar.- (1) After the balance-sheet and the profit and loss account have been laid before a company at an annual general meeting as aforesaid, there shall be filed with the Registrar within thirty days from the date on which the balance-sheet and the profit and loss account were so laid, or where the annual general meeting of a company for any year has not been held, there shall be filed with the Registrar within thirty days from the latest day on or before which that meeting should have been held in accordance with the provisions of this Act,-
(a) three copies of the balance-sheet and the profit and loss account, signed by the managing director, manager, or secretary of the company, or if there be none of these, by a director of the company, together with three copies of all documents which are required by this Act to be annexed or attached to such balance-sheet or profit and loss account:
Provided that in the case of a private company, copies of the balance-sheet and copies of the profit and loss account shall be filed with the Registrar separately:
Provided further that,-
(i) in the case of a private company which is not a subsidiary of a public company, or
(ii) in the case of a private company of which the entire paid-up share capital is held by one or more bodies corporate incorporated outside India, or
(iii) in the case of a company which becomes a public company by virtue of Section 43A, if the Central Government directs that it is not in the public interest that any person other than a member of the company shall be entitled to inspect, or obtain copies of, the profit and loss account of the company, no person other than a member of the company concerned shall be entitled to inspect, or obtain copies of, the profit and loss account of that company under Section 610.
(2) If the annual general meeting of a company before which a balance-sheet is laid as aforesaid does not adopt the balance-sheet, or is adjourned without adopting the balance-sheet, or, if the annual general meeting of a company for any year has not been held, a statement of that fact and of the reasons therefor shall be annexed to the balance-sheet and to the copies thereof required to be filed with the Registrar.
(3) If default is made in complying with the requirements of Sub-sections (1) and (2), the company, and every officer of the company who is in default shall be liable to the like punishment as is provided by Section 162 for a default in complying with the provisions of Section 159, 160 or 161.
7. Section 5 of the Act deals with 'officer who is in default', which reads as under:
Section 5. Meaning of 'officer who is in default'.-For the purpose of any provision in this Act which enacts than an officer of the company who is in default shall be liable to any punishment or penalty, whether by way of imprisonment, fine or otherwise, the expression 'officer who is in default' means all the following officers of the company, namely:
(a) the managing director or managing directors;
(b) the whole-time director or whole-time directors;
(c) the manager;
(d) the secretary;
(e) any person in accordance with whose directions or instructions the board of directors of the company is accustomed to act;
(f) any person charged by the board with the responsibility of complying with that provision:
Provided that the person so charged has given his consent in this behalf to the board;
(g) where any company does not have any of the officers specified in Clauses (a) to (c), any director or directors who may be specified by the board in this behalf or where no director is so specified, all the directors:
Provided that where the board exercises any power under Clause (f) or Clause (g), it shall, within thirty days of the exercise of such powers, file with the Registrar a return in the prescribed form.
18. It is true that in the absence of any managing director or whole-time director or manager, etc., each of the director is termed as 'officer who is in default'. On the facts of the case, it is not in dispute that there has been default on the part of the company in its obligations under Sections 159, 166 and 220 of the Companies Act by not filing returns, not convening annual general meetings from 2000-01 onwards and not filing copies of balance-sheet, profit and loss account, etc., which would result in the penalty being imposed under various provisions stated above.
19. It is also true that the offences contemplated under the said provisions are continuing offences. But the powers of the court in granting relief under Section 633 of the Act only relates to exonerating from any action of negligence or breach of duty, misfeasance against an officer of a company when it appears that such officer has acted honestly and reasonably and such officer can be relieved from his liabilities either in whole or in part or on such terms as the court thinks fit. The Section also makes it clear that such officer cannot be relieved from any civil liability which may attach in respect of negligence, default, breach of duty, etc. Section 633 which gives the power to the court is as follows:
Section 633. Power of court to grant relief in certain cases.-(1) If in any proceeding for negligence, default, breach of duty, misfeasance or breach of trust against an officer of a company, it appears to the court hearing the case that he is or may be liable in respect of the negligence, default, breach of duty, misfeasance or breach of trust, but that he has acted honestly and reasonably, and that having regard to all the circumstances of the case, including those connected with his appointment, he ought fairly to be excused, the court may relieve him, either wholly or partly, from his liability on such terms as it may think fit:
Provided that in a criminal proceeding under this sub-section, the court shall have no power to grant relief from any civil liability which may attach to an officer in respect of such negligence, default, breach of duty, misfeasance or breach of trust.
(2) Where any such officer has reason to apprehend that any proceeding will or might be brought against him in respect of any negligence, default, breach of duty, misfeasance or breach of trust, he may apply to the High Court for relief and the High Court on such application shall have the same power to relieve him as it would have had if it had been a court before which a proceeding against that officer for negligence, default, breach of duty, misfeasance or breach of trust had been brought under Sub-section (1).
(3) No court shall grant any relief to any officer under Sub-section (1) or Sub-section (2) unless it has, by notice served in the manner specified by it, required the Registrar and such other person, if any, as it thinks necessary, to show cause why such relief should not be granted.
20. Such relief can be claimed from the High Court by such officers under Section 633(2) of the Act. Therefore, relieving an officer of a company under Section 633 is only on the basis that such officer is in fact liable to be punished under the said provisions. In other words, the condition precedent for the exercise of powers by the court under Section 633 is that such officer is in fact in default having failed to perform the statutory obligations which are mandated on him. Therefore, the contention of the learned Central Government Standing Counsel that on the admitted fact of non-compliance of the provisions of the Act, the petitioner is not entitled to the relief under Section 633 is not sustainable.
21. What has to be considered is that in respect of failure to perform the statutory obligations, the officer of the company has been honest and taking into consideration the overall circumstances, I am of the considered opinion that the inability of the officer of the company from having access to accounts and other records and if the same were genuine, the same can certainly be taken into consideration to decide about the honest intention of the director.
22. Now, taking into consideration of the act of the petitioner as a director of the company in not filing the annual returns under Section 159 of the Act and not filing copies of balance-sheet and profit and loss account for the years 2001-02, 2002-03 and 2003-04 under Section 220 of the Act, on the facts of the case, it has to be considered as to whether the petitioner was in fact having possession or access to the said returns, balance-sheet and profit and loss account. If the petitioner has been prevented to have access to the said records and there has been no possibility for him to obtain the said documents, viz., returns, balance-sheet and profit and loss account in spite of the efforts taken by him to secure the same, certainly it can be construed as an honest and reasonable conduct on the part of the petitioner to be excused from the allegation of negligence, default, breach of duty or misfeasance. In the present case, as it is seen in the show-cause notice, the allegation can at the most be negligence or breach of duty.
23. It is not in dispute that the petitioner has in fact filed a petition against the other director Mr. S. Venkataramanan under Sections 397 and 398 of the Companies Act, 1956, for oppression and mismanagement. As it is seen from the petition filed against the said Mr. S. Venkataramanan, the following is the shareholding pattern of the shareholders:
(1) S. Venkataramanan - 13,750 shares - 27.5 per cent, of shareholding as shareholder and director.
(2) S. Pattabiraman (the petitioner) - 13,750 shares - 27.5 per cent, of shareholding as shareholder and director.
(3) V. Manjula (wife of Mr. S. Venkataramanan) - 11,250 shares - 22.5 per cent, of shareholding as shareholder.
(4) P. Gayatri (wife of the petitioner) - 11,250 shares - 22.5 per cent, of shareholding as shareholder.
24. It is true that in the said petition, the petitioner has stated that he has secured assets and stock value approximately worth Rs. 2.62 lakhs and requested the bank to take immediate possession of the said goods, but at the same time, it is his case that the said Mr. S. Venkataramanan has removed stocks and assets to the value of Rs. 51.73 lakhs. The said statement cannot be termed as acceptance of any misfeasance by the petitioner, by any stretch of imagination. Therefore, the contention of the learned Central Government Standing Counsel that the petitioner cannot be termed as honest within the meaning of Section 633 of the Act is again liable to be rejected. But, on the other hand, in the company petition, the petitioner has categorically stated that all the books and accounts of the company were in the custody of Mr. S. Venkataramanan and he denied entry and access of the same to him, about which he has also written to the Income-tax Department on November 30, 2000, stating that he was helpless in filing income-tax returns. It is also stated that the registered office of the company happens to be the residence of the said Mr. S. Venkataramanan, which is not denied in the reply filed to the said petition. On the other hand, in the reply, it was the specific stand of the said Mr. S. Venkataramanan that he has not denied permission to inspect the books of account and he has only denied for removal of books of account from the premises. He has also stated that he was always prepared and ready to produce the books of account. The specific stand of Mr. S. Venkataramanan before the Company Law Board is as follows:
7. Books of account. - As far as the books of account of the company are concerned, they were available at the office. But after the shocking experience that the company went through, on the night of September 8, 2000, when the petitioner removed the assets and stocks, the first respondent and the staff members became cautious and hence they did not permit the petitioner to take the books. Permission was not denied to him to inspect the books of account but permission was denied only for removal of the books of account from the office premises. As a matter of fact, the petitioner wanted to remove the books of account with a view to tamper with them. Fortunately, the staff members were vigilant and the petitioner could not do what he wanted to do. The first respondent is always prepared to produce the available books of account, wherever, this hon'ble Board wants him to.
25. In the letter dated September 5, 2002, addressed to the respondent, the petitioner has also enclosed the petition filed before the Company Law Board and requested not to proceed further since he has no access to the records. The Company Law Board in its order has no doubt dismissed the application filed under Sections 397 and 398 of the Act, but the dismissal was not on the ground of any misfeasance on the part of the petitioner herein, but it was on the basis of delay in filing such application. The Company Law Board has taken note of the claim and counter claim made by the parties regarding removal of stocks and assets and found that in the absence of any party having substantiated its stand, it was not possible for the Board to adjudicate the issue. The operative portion of the order of the Company Law Board is as follows:
9. While, according to the petitioner the respondents have removed stealthily the stock and assets of the company to the tune of Rs. 51.73 lakhs, it is contended by the first respondent that the petitioner has unlawfully removed the stocks worth about Rs. 76.73 lakhs. Admittedly, both the petitioner and the first respondent took away the stocks and assets of the company by entering the particulars in a common register (annexure 2 in rejoinder), which according to the petitioner is in the custody of the respondent, but which according to the first respondent is with the petitioner. The claim and counterclaim of the parties in regard to removal of the stock and assets of the company, neither of the parties has substantiated the same, in the absence, of which we will not be able to adjudicate the issue. In regard to the other allegations that the first respondent has not complied with the statutory obligations and failed to call for annual general meeting and board meeting of the company, it may be observed that the company is already closed and is not functioning. The statutory authority will take appropriate steps for such non-compliance. On our over-all assessment of the facts of this case, it is apparent that both the shareholders had decided to close down the business of the company by taking away the assets as seen from page 24 (annexure 5) of petition and page 44 (annexure VII) of counter of R1. This happened in September, 2000. However, this petition was filed only in March, 2002. There is no explanation for the delay in filing this petition. It is on record that the third respondent initiated proceedings before the Debts Recovery Tribunal in early 2001 and this petition was filed thereafter in March, 2002, with a specific prayer to stop Debts Recovery Tribunal proceedings. Thus, this petition appears to be a motivated one and as such deserves to be dismissed and accordingly it is dismissed.
26. It is, this order of the Company Law Board which is pending in appeal before this court. In the categorical factual position, it is clear that the possession of documents relating to the company, was undisputably with Mr. S. Venkataramanan and the documents were kept in the registered office of the company which happens to be the residence of the said Mr. S. Venkataramanan. Even in respect of taking away of the stocks and assets of the company, there has been some dispute, as was found by the Company Law Board and I am of the considered view that in such circumstances, it should be construed that the petitioner has acted honestly and reasonably and the petitioner ought to be excused in respect of statutory obligations relating to filing of annual returns under Section 159 resulting in penalty under Section 162 and filing of balance-sheet under Section 220 resulting in penalty under Section 220(3) of the Act.
27. The Calcutta High Court in Tapan Kumar Chowdhury v. Registrar of Companies [2003] 114 Comp Cas 631, has laid down the principles governing the exercise of powers of the court under Section 633 of the Companies Act, as follows (headnote):
Some of the principles governing the exercise of power by the court under Section 633(2) of the Companies Act, 1956, are as follows: (1) If there is any statutory default on the part of an individual while acting on behalf of the company the court is empowered to consider the application for excusing the person from such responsibility or liability. (2) While considering the application made under Section 633(2) the court will have to come to a conclusion that the applicant had acted honestly and fairly and even after his honest and fair act the default was committed for some unavoidable circumstances. (3) Non-compliance with such statutory requirements by the applicant was caused due to incidents beyond his control. (4) The court is neither empowered to extend the time to hold the annual general meeting or to comply with the statutory requirements nor empowered to relieve the company from such responsibility or liability.
28. In that view of the matter, it is not possible to accept the contention of the learned Central Government Standing Counsel that the exercise of powers under Section 633 of the Companies Act is possible only after the continuing offence comes to an end and there is absolutely no such hindrance to the powers of the court under Section 633 of the Act.
29. One other ground of allegation made against the petitioner in respect of non-convening of annual general meetings, which is mandatory under Section 166 of the Act for which penalty is imposed under Section 168 of the Act, certainly stands on a different footing on the factual circumstances of the case. Under Section 166 of the Act, convening of annual general meeting is a mandatory duty cast on every company. Under Section 167 of the Companies Act, as amended by the Companies (Second Amendment) Act, 2002 See [2003] 113 Comp Cas 201, the Central Government on the application of any of the members of a company can either call for or direct for a general meeting with such other further directions. The said power was with the Company Law Board before the said amendment under Section 167 of the Act which after amendment stands as follows:
Section 167. Power of Central Government to call annual general meeting.- (1) If default is made in holding an annual general meeting in accordance with Section 166, the Central Government may, notwithstanding anything contained in this Act or in the Articles of the company, on the application of any member of the company, call, or direct the calling of, a general meeting of the company and give such ancillary or consequential directions as the Central Government thinks expedient in relation to the calling, holding and conducting of the meeting.
Explanation.- The directions that may be given under this Sub-section may include a direction that one member of the company present in person or by proxy shall be deemed to constitute a meeting. (2) A general meeting held in pursuance of Sub-section (1) shall, subject to any directions of the Central Government, be deemed to be an annual general meeting of the company:
Provided that in the case of revival and rehabilitation of sick industrial companies under Chapter VI-A, the provisions of this Section shall have effect as if for the words 'Central Government', the word 'Tribunal' had been substituted.
30. On facts, it is seen that the petitioner and his wife jointly hold 50 per cent, of shares and the petitioner admittedly being one of the directors of the company has not taken any steps for the purpose of convening the annual general meeting. The non-availability of various documents like, returns, profit and loss account, balance-sheet, etc., would not in any way prevent the petitioner from approaching the appropriate authority complaining the same as contemplated under Section 167 of the Companies Act. Even under Section 169 of the Companies Act, there was a possibility for the petitioner to call for extraordinary general meeting by requisition. But, the case of the petitioner is only that it was the abovesaid Mr. S. Venkataramanan, who was in charge of the entire documents and also living in the registered office of the company has not taken any steps for convening the annual general meeting. When the petitioner has not acted as per the provisions of the Act, in this regard, by resorting to various other ways for convening meeting, the conduct of the petitioner cannot be held to be honest and reasonable in the circumstances of the case, in such view of the matter, I am of the considered view that in relation to the duty of the petitioner in convening annual general meeting, the petitioner cannot be held to have acted honestly and reasonably, in the circumstances of the case, so as to enable him to be excused and consequently relieved of the responsibility.
31. In these circumstances, the company petition stands disposed of by relieving the petitioner from the obligations under Section 159 read with Section 162 of the Companies Act regarding non-filing of annual returns for the accounting years 2001-02, 2002-03 and 2003-04 and under Section 220 read with Section 220(3) of the Companies Act for non-filing of balance-sheet and profit and loss account for the said accounting years.
32. However, the petitioner shall be liable to be proceeded with for the statutory obligation under Section 166 read with Section 168 of the Companies Act for not convening annual general meeting as per the show-cause notice issued by the respondent dated July 23, 2005. In view of disposal of the main company petition, connected company application is closed.