Companies Act Section 436 — Offences triable by Special Courts
CHAPTER XXVIII SPECIAL COURTS
Commercial / Corporate
Summary
Sub-section (1) sets out the general rule that all offences listed under sub-section (1) of section 435 can only be tried by the Special Court established or designated for the area where the company's registered office is located. If there is more than one Special Court for that area, the High Court concerned will specify which one should handle the case.
Under clause (b) of sub-section (1), when a person accused or suspected of an offence under this Act is sent to a Magistrate under section 167 of the Code of Criminal Procedure, 1973, that Magistrate may authorise the person's detention in custody for a period not exceeding fifteen days in total if the Magistrate is a Judicial Magistrate, and seven days in total if the Magistrate is an Executive Magistrate. However, if the Magistrate considers that detaining the person until the end of that period is unnecessary, the Magistrate must order the person to be forwarded to the Special Court having jurisdiction.
Under clause (c) of sub-section (1), the Special Court, in relation to a person forwarded to it under clause (b), has the same powers that a Magistrate with jurisdiction to try a case would have under section 167 of the Code of Criminal Procedure, 1973, regarding an accused person forwarded to that Magistrate under that section.
Under clause (d) of sub-section (1), a Special Court may take cognizance of an offence under this Act by looking at the police report of the facts or upon a complaint, without the accused being committed to it for trial.
Sub-section (2) provides that when a Special Court is trying an offence under this Act, it may also try any other offence, not under this Act, with which the accused may be charged at the same trial under the Code of Criminal Procedure, 1973.
Sub-section (3) states that, despite anything in the Code of Criminal Procedure, 1973, the Special Court may, if it thinks fit, try in a summary way any offence under this Act that is punishable with imprisonment for a term not exceeding three years. However, in any conviction from a summary trial, no sentence of imprisonment for a term exceeding one year shall be passed. Further, if at the start of or during a summary trial it appears to the Special Court that a sentence of imprisonment for more than one year may have to be passed, or that it is for any other reason undesirable to try the case summarily, the Special Court must, after hearing the parties, record an order to that effect, recall any witnesses who may have been examined, and then proceed to hear or rehear the case following the procedure for a regular trial.
Official Text
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974),—
(a) 3[all offences specified under sub-section (1) of section 435] shall be triable only by the Special Court established or designated for the area in which the registered office of the company in relation to which the offence is committed or where there are more Special Courts than one for such area, by such one of them as may be specified in this behalf by the High Court concerned;
(b) where a person accused of, or suspected of the commission of, an offence under this Act is forwarded to a Magistrate under sub-section (2) or sub-section (2A) of section 167 of the Code of Criminal Procedure, 1973 (2 of 1974), such Magistrate may authorise the detention of such person in such custody as he thinks fit for a period not exceeding fifteen days in the whole where such Magistrate is a Judicial Magistrate and seven days in the whole where such Magistrate is an Executive Magistrate:
Provided that where such Magistrate considers that the detention of such person upon or before the expiry of the period of detention is unnecessary, he shall order such person to be forwarded to the Special Court having jurisdiction;
(c) the Special Court may exercise, in relation to the person forwarded to it under clause (b), the same power which a Magistrate having jurisdiction to try a case may exercise under section 167 of the Code of Criminal Procedure, 1973 (2 of 1974) in relation to an accused person who has been forwarded to him under that section; and
(d) a Special Court may, upon perusal of the police report of the facts constituting an offence under this Act or upon a complaint in that behalf, take cognizance of that offence without the accused being committed to it for trial.
(2) When trying an offence under this Act, a Special Court may also try an offence other than an offence under this Act with which the accused may, under the Code of Criminal Procedure, 1973 (2 of 1974) be charged at the same trial.
(3) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), the Special Court may, if it thinks fit, try in a summary way any offence under this Act which is punishable with imprisonment for a term not exceeding three years:
Provided that in the case of any conviction in a summary trial, no sentence of imprisonment for a term exceeding one year shall be passed:
Provided further that when at the commencement of, or in the course of, a summary trial, it appears to the Special Court that the nature of the case is such that the sentence of imprisonment for a term exceeding one year may have to be passed or that it is, for any other reason, undesirable to try the case summarily, the Special Court shall, after hearing the parties, record an order to that effect and thereafter recall any witnesses who may have been examined and proceed to hear or rehear the case in accordance with the procedure for the regular trial.