Judgment : The respondent herein filed a private complaint numbered as C.C. No. 3286 of 1981 before the IV Metropolitan Magistrate, Saidapet, Madras against the petitioners under sections 120-B, 408, 409 read with sections 34 and 109, Indian Penal Code, contending that the Management of the Madras Race Club, under Article 34 of the Articles of Association vests with the members of the Committee of Management, who would constitute as Directors of the Madras Race Club under the Companies Act, 1956, and they control the funds of the Club. The members of the Committee of Management were bound in law by the Companies Act, 1956, by the licence granted to the Club by the government of India, and by the Memorandum of the Articles of Association, to apply the income and its property solely for the promotion of the objects of the Club, so that no portion of the funds were paid or transferred either directly or indirectly by way, of profit to the members. It was contended by the respondent in the private, complaint, that between November, 1980 and March, 1981, the petitioners herein, who are the members of the Committee of Management, entered into a conspiracy to enrich themselves and misappropriated large sums of money from the funds of the Madras Race Club and with this view and with a common intention to enrich themselves, their relatives and friends, the petitioners have dishonestly and fraudulently misappropriated or converted to their own use the said monies of the Club. The respondent has also stated in the complaint, that on 24th November, 1980, the Committee of Management sanctioned the granting of loans to the Club Members who would include petitioners 1 to 6, and the petitioners knowing fully well that they could not utilise the loans without the permission of the Company Law Board, passed a resolution authorising the Secretary of the Club to apply to the Company Law Board for permission, for the Committee members to utilise the loans, that the act of the petitioners is in direct violation of the trust imposed on them and the petitioners have conspired and drew several amounts as and by way of loans from the funds of the Club. In addition, a sum of Rs. 36,250 was given to the relations of the first petitioner, Rs. 30,000 to the relations of the third petitioner, Rs. In addition, a sum of Rs. 36,250 was given to the relations of the first petitioner, Rs. 30,000 to the relations of the third petitioner, Rs. 1,36,500 to the relations of the fourth petitioner and Rs. 60,000 to the relations of the fifth petitioner. In short, in the complaint, the respondent herein contends, that the petitioners acting in conspiracy between 14th November, 1980 and 23rd March, 1981, acted dishonestly to obtain for themselves pecuniary benefits and misappropriated for, their own use a sum of Rs. 4,77,750 which, according to the respondent, is illegal. This complaint was filed on 20th April, 1981. The IV Metropolitan Magistrate took the complaint on file on the allegations levelled by the respondent against the petitioners in the complaint and issued summons. It is only to quash the aforesaid proceedings in C.C. No. 3286 of 1981, the above petition in Crl. M.P. No. 2196 of 1981 has been filed by the petitioner under section 482, Criminal Procedure Code. 2. In the affidavit filed before me in Crl. M.P. No. 2196 of 1981 by the Secretary of the Madras Race Club, the seventh petitioner herein, it is contended, that the Madras Race Club is registered under the Indian Companies Act and was established in the year 1922. Under the Articles of Association, there shall be a Committee of Management consisting of 12 members elected from amongst the members of the Club and 4 members were nominated by the Government of Tamil Nadu. One-third of the elected members of the Committee of Management is to retire once a year and there shall be an election every year to fill up the vacanies of the members retiring by rotation. Under the Articles of Association, the Madras Race Club is entitled to invest funds not immediately required by the Club, in such a manner, as may be determined from time to time and the object of the Club is to carry on the business of the Race Club in all its branches and to conduct, hold and promote race meetings, etc. It was also contended in the affidavit filed by the Secretary of the Madras Race Club, that under the Scheme known as M. R. C. Scheme, the club grants loans to the members for the purchase of two year old Indian Bloodstock at the auction sales. It was also contended in the affidavit filed by the Secretary of the Madras Race Club, that under the Scheme known as M. R. C. Scheme, the club grants loans to the members for the purchase of two year old Indian Bloodstock at the auction sales. This loan is granted to the Committee members as well as to other members of the Club. Likewise, for the year 1980-81, loans were granted in accordance with the resolution of the Committee in its meeting held on 26th December, 1980. The complainant respondent is a party to the said resolution dated 26th December, 1980, and has not raised any objection for the grant of loans. 3. It was further contended that the respondent and his father were nurturing ill-feelings, malicious motives and vendetta against some members of the Committee of Management, as a result of an enquiry and suspension of the licence to Trainer, R.R. Reddy, and the Jockey R.W. Alford, in connection with their horse on 1st January, 1981. The respondent’s father, in order to wreck vengeance, has filed a civil suit in C.S. No. 21 of 1981 in this Court seeking to disqualify and remove the petitioners 1 to 6 herein from acting as the Committee members mainly on the ground that petitioners 1 to 6 have utilised the loans granted to them for purchase of race horses for the year 1980-81 in contravention of section 295 (1) of the Indian Compaines Act, 1956. Thus the father initated civil proceedings against the petitioners for their removal and his son, who is the respondent herein, has initiated the aforesaid criminal proceedings under the aforesaid sections of the Indian Penal Code, against the petitioners on the same and similar allegations found in the civil suit. It was contended that the respondent has distorted the facts and wilfully suppressed the true facts regarding the transactions of the Club. It was also contended that the allegations in the private criminal complaint that the petitioners 1 to 7 have entered into a conspiracy to enrich themselves and misappropriated huge sums of money, that they have conspired to ensure that they and their relatives, friends and associates drew out monies entrusted to them by the Club, are devoid of truth and that there is no misappropriation or unlawful enrichment as contended by the respondent. Loans were granted by the Committee of Management in the usual manner in accordance with the provisions of the Companies Act and that the approval of the Central Government was obtained by the Club and that, there is no contravention of section 295 (1) of the Companies Act as alleged by the respondent. In any event, it was contended in the affidavit, that the averments against the petitioners in the complaint do not constitute an offence under sections 406, 408 and 409, Indian Penal Code, or under any of the other sections of the Indian Penal Code, and that the essential ingredients for the offence under the Indian Penal Code, are conspicuously absent. The complaint lodged against the petitioners by the respondent cannot be said to be one, that any such offence as alleged by the respondent under the Indian Penal Code, is said to have been made out, in respect of violation of section 295 of the Companies Act, 1956. It is further contended in the affidavit field by the Secretary of Madras Race Club, that the said complaint against the petitioners filed by the respondent is only, with a view to harass the petitioners and that the father of the respondent having filed a suit, C.S. No. 211 of 1981 in this Court against the petitioners, the filing of the criminal proceedings against the petitioners on the same allegations in a criminal Court will amount to abuse of process of Court and consequently the proceedings are liable to be quashed. It was further contended that at the time of passing the resolution by the Committee of Management on 26th December, 1980, the earlier sanction granted by the Company Law Board was existing upto 15th January, 1981, and therefore, the granting of loans on the said date is perfectly legal, that there is no contravention of the provisions of the Companies Act or the Memorandum of Articles of Association or the licence granted by the Central Government and that no offence as alleged is committed by the petitioners. It was also contended that the grant of approval by the Central Government, to the resolution of the Committee of Management of the Club, for the period from 16th January, 1981 to 15th January, 1982, dates back to the date of the application filed by the Club for such approval, that the said application was made by the Club on 29th November, 1980, and the delay if any, for according the approval by the Company Law Board is not on the part of the Club and it might be due to the administrative procedural of the Central Government and that apart, the Central Government, while granting the approval, granted the same specifically with effect from 16th January, 1981, thereby approving the grant and utilisation of the loans by the members of the Committee. In any even, it was contended that the delay on the part of the Central Government in approving the resolutions of the Club cannot in any manner adversely affect the Club or the petitioners herein, as there was a valid approval obtained from the Central Government and that there has been no contravention of the provisions of the Corripanies Act or the Articles of Association as alleged in the complaint. 4. Inter alia, it was contended by the petitioners that the practice of granting loans to the members of the Committee of Management for purchase of race horses has been in vogue for the past several years and in fact the complainant-respondent herein and his father have also obtained such loans from the Club on previous occasions without demur. There is no deprivation of the property of the Club in contravention or in violation of any of the provisions of the Law or contract. No wrongful loss is occasioned by the Club nor any wrongful gains to the petitioners herein as alleged in the complaint and that on the face of the complaint and on the facts, no criminal offence is made out. In any event, since the loans have been repaid by the petitioners 1 to 6 as early as 11th April, 1981, even before instituting the complaint, there is no question of any criminal breach of trust involved and that the complaint filed by the respondent against the petitioners is an abuse of process of Court and is motivated by ill-feelings to wreak vengeance with the petitioners and also to harass and blackmail them. Hence the above petition to quash the proceedings. 5. The question for consideration is whether the complaint lodged by the respondent against the petitioners before the IV Metropolitan Magistrate on the facts of the case is maintainable and is it liable to be quashed. 6. If, on the facts placed before me, the members of the Committee of the Madras Race Club, without obtaining sanction as required under section 295 of the Companies Act, 1956, have obtained monies by passing a resolution, for their own benefit, then they are liable as alleged by the respondent. From the facts of this case, it is clear that the Madras Race Club is controlled and administered by the Companies Act, 1956. For the purpose of obtaining any loan by the Race Club, prior sanction is required under section 295 of the Companies Act, 1956. The Secretary of the Madras Race Club wrote a letter on 13th December, 1979, to the Under Secretary to the Government of India, which is as follows: "I wish to inform you that the Committee of Management of this Club has decided to continue the Scheme of financial Assistance to the Members of this Club for purchase of 2 year old Indian Horses during the year 1980. I shall be greatful if you will kindly accord permission as per terms of your letter No, 7|35|78-CL-VI dated 10th January, 1979 (copy enclosed for reference) for a further ‘period of one year with effect from 16th January, 1980’. A demand draft for Rs. 50 being the fee together with a treasury chalan in triplicate is enclosed. I further request that while according sanction, the maximum amount of loan to any borrower at any point of time may be fixed at Rs. 1,00,000 which will include the balance of previous loans, as was permitted last year. I wish to mention that Committee. Members and their relatives are being granted loans on the same basis as is being granted to Club Members. As was done in the past, the Club has decided to obtain a loan from the Bank for this purpose and the interest charged by the Bank will be passed on to Members for the period of loan is utilised. This will be applicable to Members of the Committee of Management and their relatives also, and therefore, the Club does not incur any liability. This will be applicable to Members of the Committee of Management and their relatives also, and therefore, the Club does not incur any liability. I shall be grateful if you will kindly accord necessary permission under section 295 of the Companies Act, 1956, tor grant of loan to the Members of the Committee of Management of this Club and their relatives. I shall be greatful for your early approval". 7. The Government of India, by the letter dated 18th January, 1980, has approved the request of the Madras Race Club to grant loans to the members of the Committee of Management and their relatives, which is as follows: "With reference to your letter No. RS|001668 dated the 13th December, 1979, I am directed to say that the Company Law Board has been pleased to approve under section 295 of the Companies Act, 1956, read with the Government of India, Department of Company Affairs, Notification No. GSR 443 (E), dated 18th October, 1972, the grant of loans to the members of the Committee of Management of the Club and their relatives in terms of the provision of the scheme of the Club subject to the following conditions: (i) The maximum amount of loan to any borrower shall not exceed Rs. 1,10,000 at any point of time. (ii) The loan shall be fully secured. (iii) The loan shall be recovered in five equal half-yearly instalments within a period of 3 years commencing from 16th January, 1980. (iv) The Club shall not suffer in any way in respect of interest on the loan transaction. The interest charged shall not be less than the interest paid by the Club on the loans raised for the purpose. (v) The approval shall be valid for a period of one year from 16th January, 1980. 2. This letter is issued by order of the Company Law Board". Again on 26th December, 1980, the Committee of Management of the Madras Race Club passed a resolution to which the respondent herein was a party, which is as follows: "It was decided to sanction loans to only such members and Trainers whose applications were received upto 16th December, 1980, on the following basis: Club Members Owners Rs. 40,000. Club Members Rs. 30,000. Stand Member Owners Rs. 25,000. Trainers holding ‘A’ licence Rs. 25,000. It was further decided that in case of partnership maximum of Rs. 40,000. Club Members Rs. 30,000. Stand Member Owners Rs. 25,000. Trainers holding ‘A’ licence Rs. 25,000. It was further decided that in case of partnership maximum of Rs. 1,60,000 per horse can be utilised and not Rs. 1,20,000 as decided at the Committee Meeting held on 24th November, 1980. The loans were sanctioned as per list attached. The loans are sanctioned on condition that the previous instalments, if any, due from members must be paid on or before 14th January, 1981 by cash or by Bank Draft. The loans sanctioned to Committee Members and their relatives are subject to approval by the Company Law Board. The Chairman was authorised to grant loans on the above basis for applications received after 16th December, 1980, if funds permit". Even before passing the, resolution by the Committee of Management, the Secretary of the Madras Race Club wrote a letter on 29th November, 1980, to the Under Secretary to the Government of India, Ministry of Law, Justice and Company Affairs, Department of Company Affairs (Company Law Board), New Delhi seeking permission under section 295 of the Companies Act, 1956 for grant of loans, which is as follows: "I wish to inform you that the Committee of Management of this Club has decided to continue the scheme of financial assistance to the Members of this Club for purchase of 2 year old Indian horses during the year 1981. The Committee of Management has decided to grant loans during the year 1981 free of interest as the amount required will be met by the Club’s own resources and no loan will be obtained from the Bank for this purpose. However in case of instalment being not paid by due date, an interest of 18% per annum will be charged from the date of the instalment fell due. The other terms and conditions will remain the same as in the past. I wish to mention that the Committee Members and their relatives will also be granted loans on the same basis as is being granted to Club Members. I shall be grateful if you will kindly accord permission as per terms of your letter No. 7|1|80-C.L. VI, dated 18th January, 1980 (copy enclosed for reference) for a further period of one year with effect from 16th January, 1981. A demand draft for Rs. 30 being fee together with treasury chalan in triplicate is enclosed. I shall be grateful if you will kindly accord permission as per terms of your letter No. 7|1|80-C.L. VI, dated 18th January, 1980 (copy enclosed for reference) for a further period of one year with effect from 16th January, 1981. A demand draft for Rs. 30 being fee together with treasury chalan in triplicate is enclosed. I further request that while according sanction the. maximum amount of loan to any borrower at any point of time may be fixed at Rs. 1,00,000 which will include the balance of previous loans. I shall be grateful if you will kindly accord necessary permission under section 295 of the Companies Act, 1956, for grant of loan to the Members of the Committee of Management of this Club and their relations. I shall be grateful for your early approval". The Company Law Board its letter No. 7|4| 81-CL-VI, dated 23rd April, 1981, has approved, under section 295 of the Companies Act, 1956, read with the Government of India, Department of Company Affairs, Notification No. G.S.R. 443 (E), dated 18th October, 1972, the grant of loans to the members of the Committee of Management of the Club and their relatives in terms of the provisions of the scheme of the Club subject to the following conditions: "(i) The maximum amount of loan to any borrower shall not exceed Rs. 1,00,000 at any point of time; (ii) The loan shall be fully secured. (iii) The loan shall be recovered in five equal half-yearly instalments within a period of 3 years commencing from 16th January, 1981. (iv) The Club shall not resort to borrowings to finance the loans and shall advance it from its own funds. (v) The approval shall be valid for a period of one year from 16th February, 1981". From this, it is obvious that while sanctioning the loans, the Government of India has approved the grant of loans to the members of the Committee of Management of the Club and their relatives in terms of the scheme of the Club. 8. The learned Counsel appearing for the petitioners contends that under section 292 of the Companies Act, 1956 the petitioners can exercise powers on behalf of the Company by means of resolutions passed at the meetings of the board and they have power to make loans. 8. The learned Counsel appearing for the petitioners contends that under section 292 of the Companies Act, 1956 the petitioners can exercise powers on behalf of the Company by means of resolutions passed at the meetings of the board and they have power to make loans. Section 295(1) of the, Act provides that no company, without obtaining the previous approval of the Central Government, shall directly or indirectly make any loan to, or give any guarantee or provide any security in connection with a loan made by any other person, to, or to any other person, etc., and if there is any violation, then the other provisions of the Companies Act, 1956, come in for a check. 9. In the instant case, on 13th December, 1979, the Secretary of the Madras Race Club wrote to the Government of India placing all the facts with a request that while according sanction, the maximum amount of loan to any borrower at any point of time may be fixed at Rs. 1,10,000 which will include the balance of the previous loans. The Company Law Board by its letter No. 7|1|80-C.L.-VI, dated 18th January, 1980 referring to the letter of the Secretary of the Madras Race Club, dated 13th December, 1979, has approved the grant of loans to the members of the Committee of Management of the Club and their relatives in terms of the provisions of the Scheme of the Club under section 295 of the Companies Act, 1956. It is clearly mentioned in the letter of the Government of India dated 18th January, 1980 that the sanction accorded to the members of the Committee of Management of the Club was valid for a period of one year from 16th January, 1980. During the subsistence of the sanction, another resolution was passed on 26th December, 1980, by the Committee of Management of the Madras Race Club which is extracted supra, to which resolution, the respondent herein was a party. On 23rd April, 1981. the Government of India by its letter No. 7|4|81-C.L.-VL granted sanction under section 295 of the Companies Act. 1956, and the said sanction was for a period of one year from 16th January, 1981 to 15th January, 1982. On 23rd April, 1981. the Government of India by its letter No. 7|4|81-C.L.-VL granted sanction under section 295 of the Companies Act. 1956, and the said sanction was for a period of one year from 16th January, 1981 to 15th January, 1982. It cannot be said, on perusing the sanction orders of the Government of India dated 18th January, 1980 and 23rd April, 1981, that the Committee, of Management of the Madras Race Club have violated the terms of section 295(1) of the Companies Act, 1956. At the time when the sanction was accorded by the Central Government by its letter No. 7|1|80-C.L.-VI, dated 18th January, 1980, it was valid for a period of one year from 16th January, 1980. When this sanction was valid till 15th January, 1981, another resolution was passed by the Committee of Management of the Madras Race Club on 26th December, 1980, which was also approved by the Central Government . 10. The learned Counsel Mr. Govind Swaminathan, appearing for the respondent contends that in this case, the Secretary of the Madras Race Club has written a letter on 29th November, 1980, to the Company Law Board seeking permission under section 295 of the Companies Act, for grant of loans to the members of the Committee of Management of the Club and their relatives, but at the meeting of the Committee of Management, a resolution was passed on 26th December, 1980, seeking sanction of loans to the members and Trainers and thereafter the Company Law Board accorded sanction on 23rd April, 1981, to the said resolution, which is violative of section 295 of the Companies Act, 1956, in the sense, that the petitioners have not obtained prior sanction of the approval of the loans from the Central Government at a time when the Committee of Management of the Madras Race Club passed a resolution on 26th December, 198C. But we have to see that in the resolution dated 26th December, 1980, passed at the meeting of the Committee of Management, it was specifically recorded (hat “the loans sanctioned to the Committee Members and their relatives are subject to approval by the Company Law Board”. This shows that there was no mens rea at the time of passing the resolution. This shows that there was no mens rea at the time of passing the resolution. He stated earlier that at the time of passing the resolution, the respondent herein was also a party to it and he has not raised any objection at the time of the resolution. What we have of see is whether the resolution passed by the Committee of Management, was passed at a time when there was no prior sanction from the Central Government. I am of the view that the very mentioning of the fact in the resolution dated 26th December, 1980, that the loans sanctioned to the committee members and their relatives are subject to approval by the Company Law Board, makes it clear, that the sanction will take effect only after the approval of the Company Law Board. The Central Government, after perusing the letter of the Committee of Management of the Madras Race Club, has approved the grant of loans to the members of the Committee of Management of the Club and their relatives in terms of the provisions of the scheme of the Club. 1981 to 15th January, 1982, dated back to The approval and sanction of the Central Government for the period 16th January, the date of the application filed by the Club for such approval, as the prior approval of the Central Government was obtained and was subsisting on the date of the grant of such loans. The respondent herein was aware of the approval and had, on previous occasions, obtained loans for himself and others and his approaching the criminal Court without disclosing the material facts amounts to suppressive and suggestion falsi. The person who goes to Court and seeks punishment of the petitioners without disclosing the correct facts is an abuser of process of Court. The obtaining and utilising the loans by the members of the Committee of Management, on the resolutions passed by the members of the Committee of Management of the Club, which resolutions have been approved by the Company Law Board, cannot amount to misappropriation of any Club’s funds or conversion of Club’s funds to the use of the members of the Committee. 11. 11. When once it is brought to the notice of this Court, that the act of petitioners as Committee Members of the Madras Race Club in passing the resolution on 26th December, 1980, which contains that the loans sanctioned will be subject to the approval of the Company Law Board it cannot be said to be violative of section 295 of the Companies Act, 1956, but it is only a technical defect and on that score it cannot be said that the petitioners have in terms violated section 295 of the Companies Act, 1956 and are, therefore, liable to be proceeded with in a criminal Court under the aforesaid sections mentioned in the complaint. 12. Then the further question that requires for consideration is, are the petitioners liable for the offence on the allegations of the complaint lodged by the respondent. On perusing the resolutions, it cannot be said that the resolution of the Committee Members of the Madras Race Club, to which the respondent was a party, in seeking sanction of the loans from the Government of India for the purpose of the Club and the Members, to be a dishonest act coming within the purview of section 405, Indian Penal Code, and it cannot also be said that there was conspiracy amongst the petitioners to conspire and utilise the funds for their own benefit. 13. When a petition under section 482, Criminal Procedure Code, is filed to quash the proceedings and when on the facts of the case it is brought out that the proceedings against the petitioners in C.C. No. 3286 of 1981 are an abuse of process of Court, the observation of the Supreme Court reported in State of Karnataka v. L. Muniswamy1, squarely applies, which is as follows: “In the exercise of this wholesome power, the High Court is entitled to quash a proceeding if it comes to the conclusion that allowing the proceeding to continue would be an abuse of the process of the Court or that the ends of justice require that the proceeding ought to be quashed. The saving of the High Court’s inherent powers, both in civil and criminal matters is designed to achieve a salutary public purpose which is that a Court proceeding ought not to be permitted to ”degenerate into a weapon of harassment or persecution. The saving of the High Court’s inherent powers, both in civil and criminal matters is designed to achieve a salutary public purpose which is that a Court proceeding ought not to be permitted to ”degenerate into a weapon of harassment or persecution. In a criminal case, the veiled object behind a lame prosecution, the very nature of the material on which the structure of the prosecution rests, and the like would justify the High Court in quashing the proceeding in the interests of justice. The ends of justice are higher than the ends of mere law though justice has got to be administered according; to laws made by the legislature. The compelling necessity for making these observations is that without a proper realisation of the object and purpose of the provision which seeks to save the inherent powers of the High Court to do justice between the State and its subjects it would be impossible to appreciate the width and contours of that salient jurisdiction". 14. The learned Counsel, Mr. Govind Swaminathan appearing for the respondent, relying on the observations of the Supreme Court reported in Nagamma v. Veeranna1, contends that when the Magistrate, on a consideration of the complaint, was satisfied that a prima facie case against the petitioners has been made out and has accordingly issued process against the petitioners and has exercised his discretion to issue process, it is not for this Court to substitute its own discretion to that of the Magistrate or to examine the case on merits with a view to find out whether or not the allegations in the complaint would ultimately end either in conviction or acquittal of the petitioners, where evidence has to be let in with reference to the allegations levelled against the petitioners. I have heard the arguments of the learned Counsel Mr. Govind Swaminathan. No doubt, this Court does not interfere in cases where evidence is necessary to prove the allegations. I have heard the arguments of the learned Counsel Mr. Govind Swaminathan. No doubt, this Court does not interfere in cases where evidence is necessary to prove the allegations. But prima facie, when the allegations levelled in the complaint are not clear on the facts, with reference to the sanction obtained by the petitioners and the Government of India, Company Law Board approving the resolution of the Committee of Management of the Madras Race Club, it will be an abuse of process of Court in allowing the proceedings to go ahead on a lame prosecution and on the very nature of the material on which the structure of the prosecution rests. 15. In this matter, I gave notice to the Assistant Public Prosecutor who was present in Court, to assist the Court and also to place the law under section 482, Criminal Procedure Code. He has also brought to my notice the decision reported in State of Karnataka v. L. Muniswamy2. In view of the sanction accorded by the Company Law Board by its letter No. 7|4|81-C.L. VI, dated 23rd April, 1981, it cannot be said that an offence has been made out in the complaint to attract sections 406, 408 and 409, Indian Penal Code. 16. The allegations in the complaint, if taken into consideration, in view of the a for said discussion with reference to the sanction accorded by the Company Law Board to the members of the Committee of Management of the Madras Race Club, there are improbabilities appearing on the face of the complaint with reference to the allegations levelled against the petitioners and there is a very thin line of demarcation between a probability of the allegations levelled against the petitioners and establishment of a prima facie case against them. That apart, if the allegations made in the complaint are taken on their face value and considering the sanction accorded by the Company Law Board by its letter dated 23rd April, 1981, it can be said, that no case against the petitioners has been made out nor the complaint, on the facts of the case, discloses the essential ingredients of the offence which is alleged against the petitioners. I am of the view that it will be an abuse of process of Court to allow the criminal proceedings to go ahead with its enquiay in C.C. No. 3286 of 1981, for, the ends of justice are higher than to consider the technical defect in this case of not following the provisions of section 295 of the Companies Act, 1956. That apart, parties should not be encouraged to resort to criminal Courts in a case of this type in which the point at issue between them is one, which can more appropriately be decided by a civil Court by unfolding the panoramic facts, and the parties should not be allowed to appease their anger by resorting to criminal proceedings, as it is so obvious from the arguments advanced by the respective Counsel that the father of the respondent herein has field a civil suit, C.S. No. 211 of 1981 on the file of this Court, for a declaration that petitioners 1 to 6 have ceased to be members of the Committee of Management of the Madras Race Club and Stewards of the Club on and from the date they took the loans from the Club and also, for a declaration that any vote cast in any meeting of the Committee of Management or Stewards of the Club by any of the defendants in C.S. No. 211 of 1981 by virtue of section 283 (i) (h) of the Companies Act, 1956, is void and inoperative, and the respondent herein, filing the impugned criminal case against the petitioners herein. 17. Under the circumstances, the proceedings pending before the IV Metropolitan Magistrate, Saidapet, Madras, against the petitioners herein in C.C. No. 3286 of 1981 are quashed and this petition is allowed. Proceedings quashed.