JUDGMENT (1.) N. G. CHAUDHURI, J. : This revision petition under section 397/401 read with section 482 of the Cr. P. C. is directed against order dated 27. 6. 80 passed by the Judicial Magistrate 9th Court, alipore in Case No. C/813 of 1977 (T. R. No. 496 of 1977) arising out of a petition of complaint made by the Registrar of companies, West Bengal under section 211 (7) of the companies Act, 1956. The petitioners before this court are two directors of a public limited company namely, Jagadishpur company Limited. (2.) THE principal allegation made against the petitioner accused in the petition of complaint was to the effect that as per balance sheet and profit and loss account for the financial year ending 31.3.76 and filed in the office of the complainant it transpired that the accounts of the company have been drawn up on cash basis; and as such the said accounts; without adjustment of the outstanding receipts/payments did not give a true and fair view of the state of affairs of the company and as such infringement of section 211 of the Companies Act was made. The learned Magistrate took cognizance and issued summons. The accused petitioners after entering appearance filed a petition under section 633 of the Companies Act praying for relieving them wholly from their liability if any as alleged in the petition of complaint. They alleged that ever since incorporation of the company in 1953 the company has been keeping books of account in cash system and they have been filing tine balance sheet and profit find loss accounts with the Registrar of companies every year but no objection was ever taken. When they received the audit report of the company for the year ending on 31.3.73 they noticed from the auditor's report that the company having its report that the company have been keeping its books of account in cash system and the Registrar of companies by its letter dated 14th December, 11973 called for a clarification from the company and by a letter dated 21.12.73 the company replied to the said letter. No further instructions were received from the complainant opposite party. The petitioners alleged that cash system is a recognized and accepted system of the company and was followed by the company since its incorporation in 1953 and they have all along acted honestly and reasonably. No further instructions were received from the complainant opposite party. The petitioners alleged that cash system is a recognized and accepted system of the company and was followed by the company since its incorporation in 1953 and they have all along acted honestly and reasonably. After the above petition was filed the learned Magistrate passed the impugned order. The learned Magistrate has observed in the order that the auditor's report is qualified one and it is matter of evidence if it gives true and fair view of the financial affairs of the company. The learned Magistrate proceeded on to hold that it could not be said that there was no prima facie case against the accrued at this stage. On that view he rejected the prayer of the accused for quashing the proceeding. (3.) MR. Dey, the learned Advocate for the petitioner after placing before me the petition of complaint and copies of correspondence contends that the learned Magistrate should have held that the accused petitioners all along acted honestly and reasonably and for that reason they ought to have been excused by the court and the court would have relieved them wholly or partly from their liability on such terms as the learned Magistrate thought fit in terms of sections 633 (1) of the companies Act. Sections 633 (1) of the Companies Act is quoted below : "if 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 : (4.) MR. Dey argues that the present proceedings under section 211 of the companies Act were for alleged negligence, default, breach of duty, misfeasance or breach of trust against the petitioners who were officers of a company. may think fit : (4.) MR. Dey argues that the present proceedings under section 211 of the companies Act were for alleged negligence, default, breach of duty, misfeasance or breach of trust against the petitioners who were officers of a company. He proceeds on to argue that from the materials produced by the petitioners and from the petition under section 633 of the companies Act the learned Magistrate should have concluded that the petitioners were or might be liable in respect of the negligence, default, breach of duty misfeasance or breach of trust alleged that they had acted honestly and reasonably. Mr. Dey proceeds on to argue that since it transpired that the present petitioners were being prosecuted under section 211 of the Act for the first time twenty years after the incorporation of the company the learned Magistrate should have relieved them of their liability. Mr. Dey proceeds on to argue that the learned Magistrate has not given in the impugned order reasons for which he thought the petitioners did not act honestly or reasonably. He contends that it was no case of the petitioners that the complainant had no prima facie case. He contends that when the learned Magistrate took cognizance of the offence after the filing of the complaint and issued process, the conclusion is inescapable that there was a prima facie case against the accused petitioners. Mr. De contends that there is nothing in the impugned order to show that the learned magistrate considered the petition of the accused petitioners, the provisions of section 633 of the companies Act and the reasons for applicability or non applicability of the said section to the facts and circumstances of the present case. (5.) MRS. Sanyal, on behalf of the Registrar of Companies the complainant opposite party contends that the petitioners had failed to satisfy the court below that they had acted honestly and reasonably. She further contends that the accused petitioners did not produce any evidence to disprove prima facie case against them. Her further argument is that on the basis of a petition under section 633 prayer for quashing the proceedings could not be made. (6.) I have already indicated that the case before the learned Magistrate arose out of a petition of complaint. As soon as the learned Magistrate by his order dated 27.5.77 took cognizance under section 190 (1) (a) of the Cr. (6.) I have already indicated that the case before the learned Magistrate arose out of a petition of complaint. As soon as the learned Magistrate by his order dated 27.5.77 took cognizance under section 190 (1) (a) of the Cr. P. C. and ordered issue of summons. He obviously was satisfied as to prima facie case of he opposite party complainant, The proceedings in the instant case being for violation of section 211 of the Companies act the inescapable conclusion is that the proceedings were for negligence, default, breach of duty, misfeasance or breach of trust against the petitioner accused who were officers of the company. Because of the stand taken in their petition under section 633 of the Companies act the learned Magistrate should have recorded a finding if it appeared to him that the accused petitioners were liable in respect of the act above mentioned but they had acted honestly and reasonably and that having regard to all the circumstances of the case they ought to be fairly excused. If the learned Magistrate held that the accused petitioners acted in a honest and reasonable way and in consideration of the facts and circumstances they ought to be fairly excused he could record an order relieving them wholly or partly of their liability oh such terms as he thought fit. If on the other hand the learned Magistrate arrived at a finding that the accused petitioners had not acted reasonably and honestly or that in view of the facts and circumstances of the case the accused petitioners sought not to be excused, the learned Magistrate could record a finding to that effect. In the present case the learned Magistrate does not appear to have recorded a finding positive or negative as discussed above. It should be mentioned that the accused petitioners at the stage when the petition under section 633 was filed could not be found not guilty of the offences under section 211. It should also be borne in mind as. held in M. O. HYPERLINK "http://verge. se"vergese" Vs. Sheaphen and co. reported in A.I.R. 1971 Kerala, P 223 under sub section (1) of section 633 of the companies Act in order to grant relief to a person against whom a proceeding is pending, it is not necessary he should confess or admit his guilt or that the court must find him guilty. se"vergese" Vs. Sheaphen and co. reported in A.I.R. 1971 Kerala, P 223 under sub section (1) of section 633 of the companies Act in order to grant relief to a person against whom a proceeding is pending, it is not necessary he should confess or admit his guilt or that the court must find him guilty. It is sufficient that it appears to the court "that he is or may be liable". In other words the court can relieve him of the liability in a case in which it appears to the court that he may be liable. All that is necessary is a reasonable apprehension of a proceeding referred to in sub section (1) of section 633. In the present case the learned Magistrate had after taking cognizance ordered issue of process. That clearly indicated that there was a reasonable apprehension of a proceeding against the accused petitioners as contemplated in the section because of the issue of process and the plea taken by the accused petitioners in their petition under section 633 of the Act; it was for the learned magistrate to conclude if the accused were or might be liable in respect of the defaults pleaded in the petition of complaint. If the learned Magistrate was satisfied on the above point the learned magistrate was to proceed further and to ascertain if the accused petitioners had acted honestly and reasonably and if the facts and circumstances justified the accused be fairly excused. Even if the learned Magistrate arrived at an affirmative finding on the point noted last it was for him to relieve the accused petitioner wholly or partly from their ability and on such terms as he thought fit. The learned Magistrate does not appear to have considered all these stages and matters contemplated under section 633 of the companies Act in the order impugned. I am reluctant to quash the proceedings straight way although I am satisfied that the impugned order is illegal and does hot conform to legal requirements. (7.) SO the revisional application will succeed. The order impugned dated 27. 6. 80 is set aside. The rule issued be made absolute. I am reluctant to quash the proceedings straight way although I am satisfied that the impugned order is illegal and does hot conform to legal requirements. (7.) SO the revisional application will succeed. The order impugned dated 27. 6. 80 is set aside. The rule issued be made absolute. The learned Magistrates is directed to consider the application of the accused petitioner under section 633 of the companies Act filed before his court on 21st April, 1978 in the light of observations made above and to record has findings on the points noted. While considering the above petition the learned Magistrate will pay his attention to the copies of correspondence and other documents annexed with the said petition only. The records be sent down to the court below forthwith with direction to consider and dispose of the petition under section 633 of the companies act as early as possible. Rule made absolute.