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The Complainant has filed complaint U/Sec.200 of Code of Criminal Procedure R/w. Sec.621 of Companies Act, 1956 against the Accused for the offence punishable under Section 628 of Companies Act, 1956.

2. The case of the prosecution in brief is as follows; The accused No.1 was the Managing Director, accused No.2 was the whole time Director and accused No.3 was the statutory auditor of M/s. Megacity (Bengaluru) Developers & Builders Ltd., (herein after referred to as 'MDBL'). Which was incorporated as a private limited company on 11/08/1994 and converted into a public limited company on 12/08/1998, with the object of carrying on the business to develop, construct, furnish, let-out, sell, deal in and to carry on all or any of the functions of Proprietors of lands, flats, dwelling houses, shops, offices, commercial complexes, factory sheds, buildings and accommodation of all kinds. The accused under the said company have floated a real estate project named Vajragiri project and collected about Rs.60 Crores towards booking amounts in respect of the same. However, the said project was not materialized and large number of investors money was not refunded. Accordingly, there were several complaints from the investors pointing towards the financial affairs of said company being conducted prejudicial to the interest of said investors. In view of such complaints regarding financial fraud against the company received by the Ministry of corporate Affairs, an inspection of the company U/Sec. 209A of the companies Act, was ordered and accordingly, the inspection report was submitted to the Ministry of Corporate Affairs on 31/09/2007, which brought out violation of various provisions of the companies Act by the said company. Further, the Registrar of companies, Karnataka has also conducted a scrutiny of the balance sheet of said company as on 31/03/2006 U/Sec. 234(1) of the Companies Act, 1956 and submitted a report to the Ministry of Corporate Affairs, Government of India U/Sec. 234(6) of the Act, indicating the possible diversion and misutilization of funds by the promoters of said company. In the light of said reports, the Ministry of Corporate Affairs, Government of India has directed an investigation into the affairs of said MDBL company U/Sec. 235 of the Companies Act, by its order dated: 17/04/2009. Accordingly, a team of investigators was appointed to investigate into the financial and other irregularities, contraventions / violations of the provisions of the companies Act, 1956 or fraudulent Act committed by the said company and its Directors or its Officers or any other persons in the conduct of affairs of the company. After the investigation, the said team of investigators submitted the investigation report to the Government of India. On the basis of the findings given in the investigation report as to several irregularities, fraudulent acts and contravention / violation of the provisions of the companies Act, the Ministry of Corporate Affairs had directed the complainant office i.e., The Serious Fraud Investigation Office (herein after referred as SFIO), Ministry of Corporate Affairs, Government of India, New Delhi to file complaints against the said company, its Directors and Officers by its letter dated: 14/09/2011. Accordingly, on the basis of one of the findings of said investigation report as to the falsification of balance sheet for the year ending 31/03/2006, this complaint is filed. It is the specific allegation that, the Directors of said MDBL company have falsified the companies balance sheet as on 31/05/2006 by not including the lands valuing Rs.46,72,500/- in its stock of land and the value of vehicle purchased under the name of said company in the fixed assets of the company, which is an offence punishable U/Sec. 628 of the Companies Act. Accordingly, the accused No.1 to 4 have committed the offence punishable U/Sec.628 of Companies Act, 1956.

6. The points that arise for consideration are:

1. Whether the complainant proves beyond reasonable doubt that the accused No.1 being the managing director, Accused No.2 being the whole time director and accused No.3 being Chartered Accountant of M/s. Megacity (Bangalore) Developers & Builders Limited, Bangalore, dealing with land developments, having responsibility of day today affairs of the company have falsified the companies balance sheet as at 31/03/2006 by not including the land valuing Rs.46,72,500/- in it's stock and value of the vehicle purchased on behalf of the company in the fixed assets of the company and thereby committed the offence punishable U/sec.628 of Indian Penal Code ?

2. What Order ?

7. My answer to the above points are as follows :

Point No.1 : In the Affirmative Point No.2: As per final order for the following;

REASONS

8. Point No.1 :- It is the specific case of the complainant that, accused No.1 being the managing director, Accused No.2 being the whole time director and the accused No.3 being Chartered Accountant of M/s. Megacity (Bangalore) Developers & Builders Limited, Bangalore during the period 2005-06 dealing with land developments, having responsibility of day to day affairs of the company & signatories to the Balance sheet of said company as at 31.03.2006 have falsified the companies balance sheet as at 31/03/2006 by not including the 5 items of lands purchased in the name of the company during 2005-06 valuing Rs.46,72,500/- in it's stock and also by not including the value of the vehicle Mahendra Scorpio car purchased out of the funds of the company in the name of managing director i.e., accused No.1, in the fixed assets of the company and as such they have committed the alleged offence P/U/Sec. 628 of Companies Act, 1956.