Case Law Details
S.K. Goel Vs State of Jharkhand (Jharkhand High Court)
Held that criminal proceedings cannot continue against the directors against whom there is no direct allegations of mala fide and importantly the company is not made an accused.
Facts-
The FIR was lodged by the informant alleging therein that the informant and his wife opened two Demat Trading Accounts through franchisee agents in M/s Bonanza Portfolio Ltd., whose partners/ proprietors are S.K. Goyal, S.P. Goyal, V.K. Agarwal, Shiv Kumar Goyal, and Narendra Singh. The informant used to invest most of my money in Yes Bank Shares’ future and delivery stock. There were two lots each (total no. 8800*4=35200). Bonanza Portfolio Limited sold the shares without giving information to the franchise broker, thereby, committing a breach of trust at the historical lowest price of Rs. 4.95 even though, on that very day, there was a credit balance of Rs. 5,43,150.46.
In that situation, Bonanza company could have sold only those shares whose value equaled the short amount. However, instead of doing that, the company from its office in Delhi sold out all the shares from the informant’s account and from the account of his wife, even when the trading work was done by a local broker. But neither the local broker was informed nor the informant was informed of the difference margin.
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