Judgment This application, as a complaint, under Section 454 of the Companies Act, 1956 was filed by the Official Liquidator of M/s Asup Synthetics & Chemicals Limited, way back on 03.08.1994 against its three Directors for their prosecution, inter-alia with prayer that they be punished for committing offence under subsection (5) of Section 454 of the Companies Act, 1956, as they failed to produce the statement of affairs of the company without reasonable excuse. Notice of the application was issued to the respondents on 13.01.1995. While Shri L.L. Gupta, learned counsel, put in appearance on behalf of respondent no.1 on 06.10.1995, notice on other two respondents remained unserved. This court by order dated 26.04.1996 therefore issued bailable warrant in the sum of Rs.5000/-for securing their presence. When service thereof could not be effected, fresh bailable warrants were issued against the respondents no.2 and 3 by order of this court dated 04.10.1996 on their last known address at Surat and New Delhi, respectively. It was thereafter that bailable warrants, time and again sent to secure presence of respondents no.2 and 3 on different dates, remained unserved. In that background, when the matter came up before this court on 20.02.2004, it was directed that the matter shall proceed against the respondent no.1 alone. Meanwhile, the Official Liquidator/applicant may make efforts to collect address of the respondents no.2 and 3. No efforts have been made by the Official Liquidator for effecting service on respondents no.2 and 3. The matter is thus being decided only in respect of respondent no.1. As this application was to be treated as complaint and tried as a summons case in accordance with the provisions of Section 454 of the Companies Act, the charges were read over to the accused-respondent no.1 before the court on 16.04.2004. He denied the charges and prayed for trial. Statement of accused-respondent no.1 was recorded before this court from 20th to 22nd of August, 2007. It was thereafter that the statement of the accused-respondent no.1 was recorded on 26.10.2007. The matter has remained pending for final arguments since then. Arguments in the matter were finally heard on 11.04.2014. Shri G.K. Garg, learned Senior Counsel appearing for the applicant/Official Liquidator and Shri L.L. Gupta, learned counsel appearing for the accused-respondent no.1, have made their submissions. It was thereafter that the statement of the accused-respondent no.1 was recorded on 26.10.2007. The matter has remained pending for final arguments since then. Arguments in the matter were finally heard on 11.04.2014. Shri G.K. Garg, learned Senior Counsel appearing for the applicant/Official Liquidator and Shri L.L. Gupta, learned counsel appearing for the accused-respondent no.1, have made their submissions. Facts of the case are that M/s Asup Synthetics & Chemicals Limited, the company in liquidation, was ordered to be wound up by order of this court dated 01.02.1991 in S.B. Company Petition No.20/1987, filed by M/s Boolani Engineering Corporation, Bombay. The applicant was appointed its Liquidator provisionally under Section 450(1) of the Companies Act, 1956. As per the records of the Registrar of the Companies, the respondents no.1 to 3 were the Directors of the Company. In the present case, in compliance of the provisions of Section 454 of the Act, the Statement of Affairs was required to be filed within 21 days from the date of winding up order i.e. till 21.02.1991. Since in the present case, the Liquidator was appointed on 01.02.1991, the Statement of Affairs was required to be filed on or before 21.02.1991. The complainant-Official Liquidator after receipt of the winding up order, sent a notice to the ex-Director respondents no.1 to 3, under Rule 124 of the Companies (Court) Rules, 1959, on 13.02.1992 directing them to submit the Statement of Affairs of the company in liquidation. According to the complainant, such notice was served upon the ex-Directors/respondents. The accused respondent no.1 Shri Mahendra Kumar Jain, the ex-Managing Director of the Company in liquidation, in reply to the aforesaid notice, by his letter dated 04.03.1992 informed that all the assets of the company have been sold by the RIICO and the records of the Company have also been seized. Shri Mukesh C. Patel, the respondent no.2, had informed vide letter dated 21.02.1992 that he has resigned from the Directorship of the Company. According to the complainant, however, no duly filled in Form No.32, as per requirement of Section 303 of the Companies Act, 1956, has not been furnished by the Company in the office of the Registrar of Companies to the above effect. Shri Mukesh C. Patel thus continued to be one of the ex-Directors. No reply to the notice has been received from the respondent no.3 Shri Ishwar Chand Singhal. Shri Mukesh C. Patel thus continued to be one of the ex-Directors. No reply to the notice has been received from the respondent no.3 Shri Ishwar Chand Singhal. According to the complainant, despite receipt of notice, the accused-respondent did not make any request for extension of time. That they were avoiding to file Statement of Affairs and were thus guilty of offence of sub-sections (5) and (5A) of Section 454 of the Companies Act, 1956. Shri G.K. Garg, learned Senior Counsel, appearing for the complainant Official Liquidator has argued that Section 454 (5) of the Act provides that if any person, which in this case is Director of the Company in liquidation, without reasonable excuse, makes default in complying with any of the requirements of the said provision, he shall be punishable with imprisonment for a term which may extend to two years, or with fine which may extend to on thousand rupees for every day during which the default continues, or with both. Notices were sent to the Directors to submit the Statements of Affairs with reference to sub-section (1) of Section 454. The prescribed time of 21 days or even the extendable time of three months therefrom with reference to sub-section (3) of Section 454 elapsed, yet the Directors concerned, by not filing the same, without reasonable excuse, made default in complying with this as referred to in sub-section (5) of Section 454 of the Act. All those ingredients are fully established in the present case against the accused respondent no.1, namely, Dr. Mahendra Kumar Jain. In this case, learned Senior Counsel submits, the winding up order was passed on 01.02.1991 and on that day all the three accused-respondents were Directors of the Company. Learned Senior Counsel argued that even if the factory of the Company in liquidation was taken possession of by the RIICO on 04.10.1988 because it was mortgaged with them, this would not furnish excuse to accused-respondents for not filing the Statements of Affairs in time. Law does not absolve them of their liability to do so, which is evident from the phraseology, “without reasonable excuse”, used in subsection (5) of Section 454 of the Act, supra. In other words, the default of the respondents can be condoned only if it is shown and proved to the satisfaction of the court that they had some reasonable excuse for being in such default. In other words, the default of the respondents can be condoned only if it is shown and proved to the satisfaction of the court that they had some reasonable excuse for being in such default. As per the said provision, whenever the default on the part of the accused was proved to be without reasonable excuse, they would be liable to be punished for said offence. It is submitted that the notice was served by the complainant on the accused-respondents on 13.02.1991 (Exhibit-1) to which the respondents submitted reply on 04.03.1992 (Exhibit2) informing that the assets of the company were taken over by the RIICO on 04.10.1988 and that the registered office of the company was situated inside the factory premise, and that the records were also not given to the Directors of the Company. It was thereafter that the complainant Official Liquidator sent a notice to RIICO as well as K.G. Bajoria, the Director of M/s Filament India Limited, who was the auction purchaser of the factory of the company in liquidation, calling upon them to deliver all the records of the company within fifteen days. Shri K.G. Bajoria, by letter dated 06.08.1992 informed that the records were lying in the factory premises and keys of the room in which records are lying, were with the RIICO and that they did not have any objection in the Official Liquidator taking of the record. It was thereafter that the Official Liquidator wrote to the RIICO on 07.10.1992 and required them to handover the keys of the room in which the record was lying. The RIICO by its own letter dated 21.10.1992 conveyed that at the time of taking over the possession of the unit, Shri Mahendra Kumar Jain, the Director the Company, who was present there, was asked to remove all statutory and other records from the unit and if any papers etc. were still lying at the factory site, the Official Liquidator may collect them from M/s Filament India Limited, to whom the RIICO sold the factory. It was therefore advised that Shri Mahendra Kumar Jain may be contacted for that purpose. If any record is lying inside the factory site, the complaint was free to collect them. were still lying at the factory site, the Official Liquidator may collect them from M/s Filament India Limited, to whom the RIICO sold the factory. It was therefore advised that Shri Mahendra Kumar Jain may be contacted for that purpose. If any record is lying inside the factory site, the complaint was free to collect them. Learned Senior Counsel submitted that Shri K.G. Bajoria, the Director of M/s Filaments India Limited, by letter dated 21.08.1992, informed the Official Liquidator that some old books of accounts and records were kept in one of the rooms at the factory premises by Officers of the RIICO and the key of the said room was taken by them with the assurance that the records shall be removed by them shortly, these records were still lying in the said room and that they did not have any key to the room. The learned Senior Counsel submitted that the communication received from M/s Filaments India Limited thus clearly shows when the unit was taken possession of by the RIICO in presence of accused respondent no.1 Shri Mahendra Kumar Jain, he was asked to remove all the statutory records. There is every reason to presume that he had collected the entire record because there is no reason for his not doing so especially because the Director of the Company would always be interested about the details of its debtors and creditors, which might ultimately help them to settle all the accounts and know the financial status of the company. As regards the defence of the accused-respondent no.1 that he had already resigned as Director of the Company on 31.01.1991, one day before passing of the liquidation order on 01.02.1991, the letter written to the Registrar of the Companies is Exhibit D/1. Learned Senior Counsel submitted that Form No.32 enclosed therewith indicates the receipt of the office of the Registrar of the Companies (Exhibit D-2) is dated 08.07.1994. It is therefore highly improbable that the resignation must have been submitted in time. It is therefore clearly evident that the resignation was submitted highly belated. Moreover, as per the provisions of sub-section 303 (2) of the Companies Act, a Director could not be permitted to resign after the winding up order because thereafter he ceases to be a Director. It is therefore highly improbable that the resignation must have been submitted in time. It is therefore clearly evident that the resignation was submitted highly belated. Moreover, as per the provisions of sub-section 303 (2) of the Companies Act, a Director could not be permitted to resign after the winding up order because thereafter he ceases to be a Director. It is contended that in the scheme of the Companies Act, 1956, whenever an order of winding up of a company is passed, filing of statement of affairs as per Section 454 of the Act by the erstwhile Directors of the Company is significant step for winding up of the company. Unless the statement of affairs of the company in liquidation is filed, it would not facilitate the winding up proceedings and to know the assets and liabilities of the company. Learned Senior Counsel argued that the prosecution is required to prove the default on the part of the Director or a person covered by sub-section (2) of Section 454 in furnishing the Statements of Affairs in the prescribed period of 21 days or extended period of three months thereafter. Once that is proved, the prosecution is not further required to prove the mens rea on the part of the accused in not doing so. Relying on judgment of the Punjab and Haryana High Court in Official Liquidator Vs. Ved Prakash Gupta and Others – 1994 (80) Company Cases 675, learned Senior Counsel argued that the Official Liquidator is not required to serve a notice with respect to the filing of the statement of affairs of the company. It has been statutorily made incumbent on the directors to file the statement of affairs of the company within 21 days of the appointment of the official liquidator or within the extended time. Learned Senior Counsel has referred to statement of Shri Ramesh Chand Meena, the Official Liquidator, recorded before this court to prove all these facts. At the same time he has also, referring from the statement of accused Mahendra Kumar Jain, argued that he failed to prove that he had any reasonable excuse in not filing the statement of affairs within stipulated time. He also failed to prove as to whether he took any civil or criminal action against the RIICO for not handing over the record of the company. He also failed to prove as to whether he took any civil or criminal action against the RIICO for not handing over the record of the company. He also failed to clarify as to when RIICO had taken possession of the said in August, 1998 whey did he resign on 31.01.1991 and not immediately thereafter. This clearly shows that the accused never submitted any resignation and this is false plea set up before this court. Shri G.K. Garg, learned Senior Counsel appearing for the complainant, in support of his arguments, has relied on the judgments – Official Liquidator Vs. Ganesh Narain R. Podar and Others – 1991(70) Company Case 588, Registrar of Companies, Orissa Vs. Orissa China Clay Refinery Company Private Limited -AIR 1967 Orissa 185, Globe Associates P. Ltd. (In Liquidation) Vs. F.C. Mehra and Others -1987 (61) Company Case 814, Security & Finance P. Ltd. (In Liquidation) : Official Liquidator, Security & Finance P. Ltd. Vs. B.K. Bedi and Another -1974 (44) Company Case 499, Official Liquidator, Trimurthy Vs. Niranjan Jayantilal Tolia – 1984 (56) Company Case 380 (Guj.), and K.R. Subramanian Vs. Official Liquidator, High Court of Kerala – 2009 (147) Company Case 213 (Ker). Shri L.L. Gupta, learned counsel for the accused-respondents has however opposed the application and submitted that the accused-respondent no.1 has alone put in appearance in response to the notice of this application before this court by filing his reply on 07.03.1996. The Official Liquidator has not taken any steps to get the notice of this application and thereafter repeated bailable warrants issued by this court, served on accused respondent no.2 and 3 for last more than ten years. The Official Liquidator has failed to prove that the respondent was the Director of the Company on the date of passing of the order of appointment as Official Liquidator dated 01.02.1991. It is contended that the Official Liquidator, as complainant, has himself at more than one place in the complaint referred the accused-respondent as Ex-Director of the Company. This is true also because accused-respondent no.1 on 31.01.1991 had resigned from the Directorship on required Form No.32 as per the provisions of the Companies Act and the Rules famed there-under. The copy of the receipt of Form No.32 deposited with the Registrar of Companies has been produced on record of the application as Annexure R/1/1. This is true also because accused-respondent no.1 on 31.01.1991 had resigned from the Directorship on required Form No.32 as per the provisions of the Companies Act and the Rules famed there-under. The copy of the receipt of Form No.32 deposited with the Registrar of Companies has been produced on record of the application as Annexure R/1/1. Shri Rajan Kapur was one of the Directors of the Company in liquidation, being nominee of the RIICO and therefore he ought to have been prosecuted because the RIICO has taken possession of all the records of the company. It was he who was required to furnish the Statement of Affairs as per the provisions of the State Financial Corporation Act. Learned counsel argued that as per the provisions of Section 454, ex-Directors of the company cannot be required to furnish the Statements of Affairs within 21 days from the date of winding up order. It is because sub-section (2) thereof requires the Statements of Affairs to be filed by the person, who was Director, manager, Secretary or either Chief Officer of the Company on the relevant date. As per sub-section (3) of Section 454 the relevant date is the date of appointment of provisional liquidator. In this case, this date was 01.02.1991. Since on that date, the accused-respondent had resigned, he was not the Director of the Company and therefore he was not under an obligation to submit the Statement of Affairs. Learned counsel submitted that this is a significant aspect of the matter because as per sub-section (2) of Section 454 of the Companies Act a Director would be required to furnish the Statements of Affairs on Form No.55 as per Rule 124 of the Companies (Court) Rules, 1959 read with Section 454 of the Act whereas the ex-Director would be for that purpose covered by Rule 125 of the said Rules, required to furnish such particulars on Form No.56. In any case, the learned Counsel submitted, the respondent no.1 could be held guilty of the offence under sub-section (5) and (5A) of Section 454 only if it is proved that he in not furnishing the Statements of Affairs made default “without reasonable excuse”. In any case, the learned Counsel submitted, the respondent no.1 could be held guilty of the offence under sub-section (5) and (5A) of Section 454 only if it is proved that he in not furnishing the Statements of Affairs made default “without reasonable excuse”. Learned Counsel submitted that since record in the present case was seized by the RIICO, the respondent no.1 cannot be said to have had access to such record so as to be able to furnish the Statements of Affairs. In fact, the Official Liquidator was required to take possession of the record and keep the same in his custody as per the requirement of Section 456, which he failed to do so. The Official Liquidator even failed to serve notice on the accused-respondent no.1 within 21 days from 01.02.1991 when the winding up order was passed, which period expired on 22.02.1991. In fact, the Official Liquidator even on his own showing has issued such notice, under Rule 124 on Form No.55, on 30.02.1992 after expiry of almost one year from the date of winding up order. On such facts, the respondent no.1 cannot be held guilty of offence under Section 454(5) of the Act. Learned counsel alternatively submitted that the reply to the notice was immediately sent by the accused-respondent on 04.03.1992 in which he submitted that the assets of the company were taken over by the RIICO on 04.10.1988. The records were also not given to the Directors of the Company. The registered office was also situated inside the factory premises, which too was taken possession of by the RIICO. It is submitted that the Official Liquidator has now disclosed before this court that he had exchanged certain correspondence with RIICO as well as auction purchaser M/s. Filaments India Limited. Learned counsel referring to all such correspondence, submitted that neither the Official Liquidator nor even the RIICO thereafter informed the respondent as to what records were found in that room of factory premises. No further or specific notice was served by the Official Liquidator on the accused-respondent as to the steps taken by him after procuring the keys of the room. The Official Liquidator even otherwise did not inform as to whether the keys were procured from RIICO which in all probability appears to have been obtained by him from the RIICO. If keys were procured, what records were found in the room. The Official Liquidator even otherwise did not inform as to whether the keys were procured from RIICO which in all probability appears to have been obtained by him from the RIICO. If keys were procured, what records were found in the room. If the records were taken possession of, were they not having the account books of the company. Absence of the records, therefore, was indeed a reasonable excuse for the respondent no.1 for not filing the statement of affairs. Learned counsel in this connection has referred to cross-examination of Shri Ramesh Chand Meena, the Official Liquidator, who admitted that he had no idea about the record of the company and further that Shri K.G. Bajoria, purchaser of the unit, did not give any statement or letter to the effect that the record of the company was in possession of Shri Mahendra Kumar Jain. He also admitted that M/s Filament India Limited admitted in their correspondence with Official Liquidator that record was lying in their unit. He also admitted that he was not provided any proof with regard to presence of Shri Mahendra Kumar Jain at the time of taking possession by the RIICO and that he did not send any letter regarding status of record to Shri Mahendra Kumar Jain and further that he did not know where the record was lying. He further stated that he did not submit application under Section 454 (1) of the Act before the District Magistrate for taking possession of the record nor did he lodge any first information report. He also admitted that he did not give any authorization to Shri Mahendra Kumar Jain to collect the record. Shri L.L. Gupta, learned counsel for the accused-respondent, argued that the present proceedings are in the shape of criminal trial as a summons case and therefore in any event, the burden of proof for proving guilt of the accused-respondent would be on the prosecution by required degree of proof “beyond reasonable doubt”. The provisions of Section 454 (5) of the Act have to be therefore strictly construed as that provision itself envisages that a person can be punished for making default in complying of any of the requirement of the said Section only if he did so “without reasonable excuse”. In the present case, such burden of proof has not been discharged by the prosecution by required degree of proof. In the present case, such burden of proof has not been discharged by the prosecution by required degree of proof. Learned counsel for the accused-respondent, relying on the judgments of the Supreme Court in Kali Ram Vs. State of Himachal Pradesh – AIR 1973 SC 2773 and State of Delhi Administration Vs. V.C. Shukla and Another – AIR 1980 SC 1382 , argued that as per the ratio of those judgments, the prosecution has failed to prove its case beyond reasonable doubt. Even if two views are possible on the evidence adduced in the case, one pointing towards guilt of the accused and other to his innocence, the view which is favourable to accused should be preferred. Learned counsel for the accused-respondent, relying on the judgments of the Supreme Court in M/s Kumar Exports Vs. M/s Sharma Carpets – AIR 2009 SC 1518 , argued that an accused is not required to prove his defence beyond reasonable doubt as is expected of the complainant in criminal trial. He has to merely probablize his defence. Learned counsel argued that mere default in complying with any of the requirements of Section 454(1) of the Act is not an offence punishable under sub-section (5). It is only when such default is proved to have been committed without any reasonable excuse. Such offence thus can be said to be made out only if it is simultaneously proved that such default was made without reasonable excuse. It is the prosecution which is to prove that the accused did not have reasonable excuse in not furnishing the statement of affairs and not the vice-versa. In other words, the accused is not required to prove that he had reasonable excuse for not furnishing the statement of affairs. The question of mens rea in such event would therefore be inconsequential. Learned counsel for the accused-respondent has in support of his arguments, relied on the judgments of different High Courts in – Official Liquidator, R.S. Motors Private Limited Vs. Jagjit Singh Sawhney and Another – 1974 (44) Company Case 381 (Delhi); K.S. Mathura Dass Vs. State of Punjab and Another – 1977 (47) Company Case 467 (P&H); Devinder Kishore Mehra Vs. Official Liquidator and Others – 1980 (50) Company Case 699 (Delhi); Official Liquidator Vs. Smt. K. Indira and Others – 1983 (54) Company Case 644 (Kerala); Sunrise OLEO Chemicals Limited Vs. State of Punjab and Another – 1977 (47) Company Case 467 (P&H); Devinder Kishore Mehra Vs. Official Liquidator and Others – 1980 (50) Company Case 699 (Delhi); Official Liquidator Vs. Smt. K. Indira and Others – 1983 (54) Company Case 644 (Kerala); Sunrise OLEO Chemicals Limited Vs. M.U.S. Rao and Others – 2004 (122) Company Case 519 (AP). Let me begin with the preliminary plea of the defense that the Official Liquidator did not serve notice on the accused-respondent within 21 days from 01.02.1991 when the winding up order was passed and in fact, served such notice almost one year thereafter on 30.02.1991. This argument cannot be countenanced for the simple reason that Section 454 of the Act read with Rule 125 of the Companies (Court) Rules statutorily makes its incumbent on the Director to produce statement of affairs within twenty-one days or within the extended time, not more than three months, for reasons to be recorded in writing. Still then the defense of the accused that he had a reasonable excuse not to file the statement of affairs will have to be examined on the basis of evidence led by the prosecution. In order to held a Director of the Company, guilty for offence under sub-Section (5) of Section 454 of the Companies Act, 1956, the ingredients thereof have to be proved. Sub-Section (1) of Section 454 requires that there shall be made out and submitted to the Official Liquidator a statement as to the affairs of the Company in the prescribed form, verified by an affidavit, containing the particulars as to the assets of the company, stating separately the cash balance in hand and at the bank, if any, and the negotiable securities, if any, held by the company; its debts and liabilities; the names residences and occupations of its creditors, stating separately the amount of secured and unsecured debts; and in the case of secured debts, particulars of the securities given, whether by the company or an officer thereof, their value and the dates on which they were given; the debts due to the company and the names, residences and occupations of the persons from whom they are due etc. Such particulars are to be furnished on prescribed form containing Company Court Rules. Such particulars are to be furnished on prescribed form containing Company Court Rules. Sub-Section (2) of Section 454 in particular refers to duty of the Directors and that of the person, who on the relevant date is Manager, Secretary or other Chief Officer of the Company, to submit duly verified statement, on being required by the Official Liquidator, under the order of the Court. Sub-Section (3) of Section 454 provides that said statement shall be submitted within twenty-one days from the relevant date, or within such extended time not exceeding three months from that date. Sub-Section (4) provides that any person making, or concurring in making, the statement and affidavit required by this section shall be paid by the Official Liquidator, out of the assets of the company, such costs and expenses incurred in and about the preparation thereof. It is then that sub-Section (5) provides that if any person, without reasonable excuse, makes default in complying with any of the requirements of this section, he shall be punished with imprisonment for a term which may extent to two years, or with fine which may extend to one thousand rupees for every day during which the default continues, or with both. Survey of the relevant provisions thus show that sub-Section (5) of Section 454 does not ipso facto make any default penal. Such default intends penalty only when it is shown that it was made without reasonable excuse. There should be no difficulty in submitting such statement of affairs, if the records were readily available to the Director or otherwise he had access to such records, but the defense set up by the accused-respondent in the present case is that neither was he in possession of the record nor did he otherwise have access thereto. Though, the accused-respondent, by not submitting the statement of affairs has prima facie committed the default but this is to be examined from the standpoint whether accused-respondent has made such default without any reasonable excuse. Thus the question, which arises for consideration is as to what is meant by reasonable excuse and whose burden is it to prove that the accused-respondent/Director had or did not have, reasonable excuse, in not being able to produce the statement of affairs. Thus, the pointed and pertinent question would be as to the burden of proof. Thus the question, which arises for consideration is as to what is meant by reasonable excuse and whose burden is it to prove that the accused-respondent/Director had or did not have, reasonable excuse, in not being able to produce the statement of affairs. Thus, the pointed and pertinent question would be as to the burden of proof. Whether the Official Liquidator is required to prove that the accused-respondent defaulted in submitting the statement of affairs without reasonable excuse or the accused-respondent has to prove that he had reasonable excuse in not being able to produce the statement of affairs of the company. This precise question was referred to the Larger Bench of the Delhi High Court in O.L. of Security and Finance Private Limited Vs. B.K. Bedi and Others – (1974) 1 ILR (Del) 809. The Larger Bench held that in a prosecution under Section 454 (5) and (5A), the burden of proving that the accused without reasonable excuse made a default is on the complainant in the first instance. The question of onus will have to be decided by keeping the distinction between legal burden of proof laid down by law and a provisional burden raised by state of evidence. It is thus clear that the burden of proving both the ingredients that the accused committed default and that he committed such default without any reasonable excuse, lies on the prosecution. Unless these two ingredients are proved; conviction in those offences cannot be recorded. There are two kinds of burden of proof, one is absolute burden for finally establishing of the case and another is the initial burden to discharge the onus. The offence in the present matter does not fall in the former category as it is a shifting burden. The latter category of burden however, is clearly an initial burden. If the initial burden is discharged by the prosecution, it will shift on to the accused. Now, coming to evidence of prosecution, Ramesh Chand Meena, the Official Liquidator, has stated that the letter was issued to the ex-Director by the Official Liquidator on 13.02.1991 for filing statement of affairs. He has stated that he had no knowledge regarding record of the company. Only the ex-Directors of the Company could have such knowledge. Now, coming to evidence of prosecution, Ramesh Chand Meena, the Official Liquidator, has stated that the letter was issued to the ex-Director by the Official Liquidator on 13.02.1991 for filing statement of affairs. He has stated that he had no knowledge regarding record of the company. Only the ex-Directors of the Company could have such knowledge. Shri Mahendra Kumar Jain, ex-Director of the Company, had sent a letter to the Office of the Official Liquidator that the possession of the factory premises was taken over by the RIICO on 04.10.1988. The registered office was maintained in the factory premises. The records were not given to him by the RIICO. The Official Liquidator has stated that he sent a letter to the RIICO authorities to handover the keys of the rooms locked inside the factory premises. A copy of the said letter was also sent to Shri K.C. Bajoria, the Director of M/s Filament India Limited, the purchaser of the factory. Shri K.C. Bajoria in his letter dated 31.07.1998 (Exhibit-3) has stated that one room was locked by the RIICO and keys are with the RIICO officials. In his letter dated 06.08.1992 (Exhibit-4) he further mentioned that they would have no objection if the records kept in the room are taken over by the Official Liquidator. The Official Liquidator further stated that Shri V.D. Mishra, the Adviser (Law) of RIICO, has stated in the letter that at the time of taking over the possession of the unit, Shri Mahendra Kumar Jain, the ex-Director the Company, was present and asked to remove the records of the Company, if any papers etc. were still lying in the factory premises, the Official Liquidator could collect the same. M/s Filament India Limited, in the letter dated 09.12.1992 (Exhibit-6) again stated that some old books and records were kept in one room at the factory premises and keys were with the RIICO and records were still lying in the room, and that they would have no objection if possession of the records was taken by the Official Liquidator or by the ex-Director Shri Mahendra Kumar Jain. The Official Liquidator further stated that Shri K.C. Bajoria has sent letter dated 07.10.1992 to the RIICO (Exhibit-11) asking them to handover the keys of the room to the Official Liquidator. The Official Liquidator further stated that Shri K.C. Bajoria has sent letter dated 07.10.1992 to the RIICO (Exhibit-11) asking them to handover the keys of the room to the Official Liquidator. In his cross-examination, Shri Ramesh Chand Meena, the Official Liquidator, has stated that Shri K.C. Bajoria, purchaser of the Unit, has not given any statement or letter to the effect that record of the Company was in possession of Shri Mahendra Kumar Jain, the ex-Director of the Company. He has also admitted that M/s. Filament India Limited in their correspondence with the Official Liquidator, admitted that the record was lying in the Unit in a locked room. In response to specific query whether there was any record to prove presence of Shri Mahendra Kumar Jain at the time of taking possession of the factory premises by the RIICO, the Official Liquidator said no. He also stated that he did not take key of the room from the RIICO authority. He also admitted that he did not send any letter to Shri Mahendra Kumar Jain, after he received the letter dated 13.02.1992 regarding status of record and in fact exchanged in correspondence with RIICO and M/s Filament India Limited. When asked specifically as to in whose custody the record was lying, he pleaded ignorance. He also admitted that he did not give any authorization to Shri Mahendra Kumar Jain to collect the record after the company was ordered to be wound up. It was thereafter that Official Liquidator was put specific question whether any notice was given by the Official Liquidator office to Shri Mahendra Kumar Jain intimating the fact that record of the company was not found in the factory premises of M/s Filament India Limited, the Official Liquidator admitted that he did not give any such information to him. Then comes the evidence of defense. Shri Mahendra Kumar Jain, accused-respondent, in the examination made under Section 313 Cr.P.C., has stated that the possession of the factory Unit was taken over by the RIICO on 04.10.1988 by breaking open the locks. Since the registered office of the Company was located in the factory premises at F-453, RIICO Industrial Area, Bhiwadi, Alwar, the record of the Company was also taken possession by the RIICO. He was not present there on the day when the possession was taken. He resigned from the post of Director of the aforesaid Company on 31.01.1991. Since the registered office of the Company was located in the factory premises at F-453, RIICO Industrial Area, Bhiwadi, Alwar, the record of the Company was also taken possession by the RIICO. He was not present there on the day when the possession was taken. He resigned from the post of Director of the aforesaid Company on 31.01.1991. He stated that he made all efforts to procure the records from the RIICO. In this connection, he has relied on letters Exhibit D-4, Exhibit D-5 and Exhibit D-6. He has also written a letter to the respondent dated 09.02.1990 (Exhibit D6). He stated that statement of affairs could not be submitted for want of the record of the company. He further stated that as per the affidavit filed by Shri K.G. Bajoria, records of the company were lying in the locked room and keys thereof were taken by the Official Liquidator. In response to the query whether at the time of taking over possession by the RIICO, the RIICO asked the Official Liquidator for taking the statutory and other records of the company, the accused has stated that the RIICO did not ask him to do so, rather when he asked the representative of the RIICO to release the record, they did not allow him to take possession of the record. In answer to query as to who was responsible for taking custody of the record, when the possession of the factory was taken over by the RIICO, this witness admitted that he was responsible and that he made all efforts to collect the record. On being asked why did he not move the application for extension of time for filing of statement of affairs, this witness stated that because he did not have the records and therefore he did not file any such application. In answer to another query, he stated that he sent a letter to the Official Liquidator on 04.03.1992 (Exhibit 2), requesting that he should help in getting the record for filing the statement of affairs. All the documents, which are referred to in these two statements, have been placed on the record. In answer to another query, he stated that he sent a letter to the Official Liquidator on 04.03.1992 (Exhibit 2), requesting that he should help in getting the record for filing the statement of affairs. All the documents, which are referred to in these two statements, have been placed on the record. Evidently, there is admission of Shri K.G. Bajoria, the Director of Filament India Limited, especially in his letter dated 11.08.1992 that “all the books and records of the said Company are lying at our factory at F-453, RIICO Industrial Area Bhiwadi (Raj.) and the keys of the room, in which the records are kept are with RIICO. We do not have any objection in your taking over the records of the said company. You are free to come on any working day to our factory to take possession of the said records. Any help or cooperation, as may be required, would be extended by us.” It is thereafter that the Official Liquidator has sent a letter to the RIICO on 07.10.1992 (Exhibit-I), requesting them to handover the keys of the rooms in which the record was lying. Shri V.D. Mishra, Adviser (Law) replied to the Official Liquidator, that if any papers etc. are still lying at the factory site, he may collect them from M/s. Filament India Limited, to whom they have sold the factory on “as is where is” basis. Shri K.G. Bajoria again sent a letter to the Official Liquidator on 21.08.1992 that some old books of account and records were kept in one of the rooms at the factory premises by officers of the RIICO and the key of the said room was taken by them with the assurance that the records shall be removed by them shortly. Those records are still lying in the said room. He stated that they did not have any key. Shri K.G. Bajoria has filed an affidavit (Exhibit D-8) stating that the records relating to company in liquidation, are not in their possession as alleged in the application filed by the Official Liquidator dated 17.01.1995. All the documents and records of the Liquidated company have already been taken over by the Official Liquidator on 05.07.1993. Shri K.G. Bajoria has filed an affidavit (Exhibit D-8) stating that the records relating to company in liquidation, are not in their possession as alleged in the application filed by the Official Liquidator dated 17.01.1995. All the documents and records of the Liquidated company have already been taken over by the Official Liquidator on 05.07.1993. In another affidavit (Exhibit D-9), Shri K.G. Bajoria has stated that the records were in their possession till 09.07.1993 and on that particular date the Official Liquidator took possession of the goods and the record lying in the factory, but they were given receipt of only the goods taken by them and not of the records on the plea that no receipt for the same was issued to them (Filament India Limited) by the RIICO in lieu of such records or by anybody at the time when factory was handed over to them. In view of the evidence analyzed above, despite initial, though partial, discharge of burden of proof, the prosecution cannot be said to have discharged its further burden that the accused-respondent had committed default in submitting the statement of affairs without any reasonable excuse. The accused-respondent rather disproved the charge against him by evidence on record showing that since he did not have access to record, he had reasonable excuse in not being able to furnish the statement of affairs. In the absence of record possibly, he would not be in a position to prepare and submit the statement of affairs. On consideration of the entire evidence and in view of the discussion made above the prosecution has failed to prove that failure of the accused-respondent to submit the statement of affairs as contemplated by Section 454(1) of the Act was without reasonable excuse. Conversely, the accused has also probablized his defence that he had a reasonable excuse for not being able to submit such statement. It is even otherwise, trite that if on given evidence, two views are possible, the one which favours the accused, shall have to be preferred. The prosecution has thus failed to prove the guilt of the accused-respondent beyond reasonable doubt entitling him to benefit of doubt. The complaint/application therefore fails and is dismissed. Accused is acquitted of the charge under Section 454 of the Act.