Case Law Details
Ravi Parthasarthy and Ors. vs. State of Tamil Nadu
Conclusion: The FIR against the ex-director of IL&FS was quashed as when SFIO was probing the case, no other investigative agency was empowered to investigate into the affairs of IL & FS and its subsidiary companies for any offences under the Companies Act but the same did not allow a clean chit to assessee herein, as persons who was beyond a pale of doubt.
Held: Assessee contended that he could not be proceeded with under the TNPID Act in view of the bar u/s 212 of the Companies Act relating to investigation by SFIO and once investigation by SFIO was proceeded, all the other investigations would stand merged with the investigation conducted by SFIO and further the non-convertible debentures floated by ITNL not being a deposit within the meaning of the TNPID Act, the case registered by the 1st respondent was per se impermissible and unsustainable and, therefore, the same deserved to be quashed. Whether entrustment of investigation to SFIO by the Central Government u/s 212 of the Companies Act bar the jurisdiction of other investigating agencies to proceed with investigation into any matter concerning the affairs of the company. It was held that the economic offence committed by IL & FS and its group companies was to the whooping tune of Rs.91,000 Crores and above, which had a spiraling and cascading effect on the economic growth of the country, which had resulted in the Central Government interfering in the administration of IL & FS and its group companies by filing petition before NCLT for reconstitution of the Board. The various orders passed by the Tribunal at the interference of the Central Government clearly show that all was not well with IL & FS and its group companies and also the persons, who were manning the said companies, of which assessee also formed a part then. Though assessee had come out of the post of Directors, it was not to be forgotten that the action by the Central Government in filing petition before the NCLT and ordering of investigation by SFIO clearly show the economic imbalance which the group companies had created in derailing the economy of the country. Finding had been rendered by NCLT that assessee was within the Committee of Directors who was at the helm of affairs in running IL & FS and its group companies. This Court, by quashing the case relating to TNPID Act, by no stretch, was giving a clean chit to assessee herein, as persons who was beyond a pale of doubt. This Court had only quashed the case against assessee on the ground that the investigation under the TNPID Act by the 1st respondent was not sustainable as SFIO was probing the case, no other investigative agency was empowered to investigate into the affairs of IL & FS and its subsidiary companies for any offences under the Companies Act.
FULL TEXT OF THE MADRAS HIGH COURT ORDER /JUDGEMENT
Initially, Crl. O.P. No.11206/21 was listed before this Court on 6.7.2021 and during the hearing of the said petition for bail, it was fairly conceded by the learned senior counsel appearing for the respective petitioners as well as the intervenors that the bail petition is intrinsically connected with the quash petitions in Crl. O.P. Nos.3730, 4095 and 4227/21 and, therefore, the said petitions may be tagged together and listed for hearing so as to give a quietus to the issue. It was also informed on behalf of the intervenor that W.P. No.1397/2021 has been filed for a mandamus praying for certain directions and the said petition, too, being connected with the issue on hand, Registry was directed to place the matter before the Hon’ble Chief Justice as to the listing of the bail petitions, the quash petitions and the writ petition and upon orders of the Hon’ble Chief Justice, the petitions are listed before this Court for hearing.
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