The Supreme Court has dismissed the Centre’s review petition challenging its earlier judgment holding that Special Courts cannot take cognisance of certain fraud-related offences under the Companies Act, 2013 on the basis of private complaints.
A Bench comprising Chief Justice of India Surya Kant and Justice K Vinod Chandran and Justice Joymalya Bagchi declined to reconsider its January 9, 2026 judgment in Union of India v. State of Telangana.
The Court, however, clarified that the Central government can authorise an officer, through a general or special written order, to institute a complaint under the second proviso to Section 212(6) of the Companies Act.
The review petition arose from the Court’s interpretation of Section 212(6), which provides that a Special Court can take cognisance of offences covered by the provision only on a written complaint made by the Director of the Serious Fraud Investigation Office (SFIO) or an officer of the Central government authorised for the purpose.
In its earlier judgment, the Supreme Court held that the statutory restriction is not confined to the offence of fraud under Section 447 but also extends to offences intrinsically connected with it.
The case arose from a private complaint alleging that former directors of a company had unlawfully convened an extraordinary general meeting, fabricated board and shareholder resolutions and made false statutory filings before the Registrar of Companies.
The Special Court for Economic Offences in Hyderabad had taken cognisance of offences under Sections 448 and 451 of the Companies Act, besides provisions of the IPC. The Telangana High Court had refused to quash the proceedings.
The Supreme Court subsequently held that Section 448, which deals with false statements, falls within the ambit of the restriction under Section 212(6), as its punishment is linked to fraud under Section 447.
The Court also held that Section 451, dealing with repeated defaults, was covered by the statutory scheme. It consequently quashed the proceedings concerning the Companies Act offences, while allowing the prosecution under the IPC provisions to continue.
During the review proceedings, Additional Solicitor General Aishwarya Bhati raised concerns over the implications of the judgment for cases investigated by authorities other than the SFIO, including matters involving the Registrar of Companies.
The Supreme Court clarified that the Centre can deal with such cases by exercising its power under the second proviso to Section 212(6) and specifically authorising an officer to institute the complaint.
With the review petition dismissed, the January judgment continues to hold the field. The ruling effectively means that a private complainant cannot independently initiate proceedings before a Special Court for the specified fraud-related offences under the Companies Act. Such prosecution must be instituted through the mechanism prescribed under Section 212(6), including by an officer duly authorised by the Central government.
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