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1989 DIGILAW 29 (RAJ)

MEHTA AND COMPANY, JAIPUR v. STATE OF RAJASTHAN

1989-01-16

G.K.SHARMA

body1989
Judgment G. K. SHARMA, J. ( 1 ) THESE revision petitions have been preferred against the order dt. 29th Dec. , 81, by which, the trial Court ordered to issue process against the petitioners except petitioner 1. ( 2 ) THE facts of Revision petitions 97 and 53 of 1982, are similar, while those of Revision Petitions Nos. 98 and 52 of 1982 are similar. In all these revision petitions, a common question of law is involved, and hence they are disposed of by this common order. ( 3 ) IN Revision Petitions Nos. 97 and 53 of 1982, a complaint was filed by the Drug Inspector, Pali, against M/s. Mehta and Co. and Harakchand Jain, c/o. M/s. Vimal Medical Store, Shivganj. According to that complaint, the Inspector had taken some sample on 17th Oct. , 76, which was sent to chemical examiner and the said sample on examination, was found of sub-standard, and hence, the said complaint was filed. ( 4 ) SO far as Revision Petitions 98 and 52 of 1982 are concerned, a complaint was filed against M/s. Vimal Medical Stores, Shivganj, M/s. Mehta and Co. , and M/s. Bhagwan Dass Poonam Chand Anadara. According to that complaint, the Inspector had taken some sample on 22nd Sept. , 76, and on examination by the chemical examiner, it was to found to be of sub-standard and hence, this complaint was filed. ( 5 ) THE Drug Inspector, in both these complaints on 18th July, 80, filed an application to implead the partners of both the firms as accused persons. The application was objected to by the accused persons. But, vide order dt. 29th Dec. , 81, the trial Court accepted the application, and issued process against the partners of the two firms, namely, M/s. Mehta and Co. and M/s. Vimal Medical Stores. Aggrieved by that order, the present revision petitions have been preferred. ( 6 ) THE learned counsel for the petitioners argued that S. 34 of the Drugs and Cosmetics Act, 1940, lays down offences committed by the companies. and M/s. Vimal Medical Stores. Aggrieved by that order, the present revision petitions have been preferred. ( 6 ) THE learned counsel for the petitioners argued that S. 34 of the Drugs and Cosmetics Act, 1940, lays down offences committed by the companies. According to Sub-Sec. (1) of this Section where, an offence under this Act, had been committed by any person, who at the time when the offence was committed was in charge and was responsible to the company, for the conduct of the business of the company as well as the company shall be deemed to be guilty of an offence and shall be liable to be proceeded against and punished accordingly. The Explanation given under this Section, was brought to my notice, by the learned counsel for the petitioners, which says that a company means a body, corporate, and includes a firms or other associations of individuals. Thus, his argument was that in view of S. 34, it is very clear that the persons, who at the time of the commission of the offence, were in charge of the business can only be prosecuted under this Act, and the partners who were not in charge of the business, may be partners, and there are circumstances when the partners may live outside the city, in that case, it would be quite illegal to implead them as accused in a case. He argued that the partners who were residing outside the place of the business, could not be held responsible for the offence under this Act, and it is because of that reason that S. 34 says that a person who is incharge of the business on the date when the offence is committed by the company, that partner or the person in charge of the business, is liable to be prosecuted and not other persons who were not in charge of the business who were not working on that date. A similar provision is also there in the P. F. A. Act. ( 7 ) IN support of his argument, the learned counsel for the petitioner relied on the case of Municipal Corpn. of Delhi v. R. K. Rohtagi, AIR 1983 SC 67 . In that case, the complaint clearly contained allegations regarding the sample taken by the Inspector from a shop. The sample taken was sent to public analyst, who found it to be adulterated. of Delhi v. R. K. Rohtagi, AIR 1983 SC 67 . In that case, the complaint clearly contained allegations regarding the sample taken by the Inspector from a shop. The sample taken was sent to public analyst, who found it to be adulterated. The complaint was filed against the company, its Directors and its Manager, Honble the Supreme Court, in that case, observed as under (Para 15) :"so far as the Directors are concerned, there is not even a whisper nor a shred of evidence nor anything to show, apart from the presumption drawn by the complainant, that there is any act committed by the Directors from which a reasonable inference can be drawn that they could also be vicariously liable. In these circumstances, therefore, it can be said that no case against the Directors has been made out ex facie on the allegations made in the complaint and the proceedings against them were rightly quashed by the High Court. "in that case, regarding the Manager of the company who was directly in charge of its affairs, could not fall in the category as the Directors, and it was observed. "it could not be reasonably argued that no case is made out against the Manager, because from the very nature of his duties, it is manifest that he must be in the knowledge about the affairs of the sale and manufacture of the disputed sample. From the very nature of his duties, it can be safely inferred that the Manager would undoubtedly be vicariously liable for the offence, vicarious liability being an incident of an offence under the Act. Hence the order of the High Court quashing the proceedings against the Manager is liable to be set aside. " ( 8 ) THUS, from the above judgement of Honble the Supreme Court it becomes clear that a person who was in charge of the affairs of the company, could only be liable for the offence committed by the company; and a person who was in charge of the business when the offence is alleged to have been committed, can only be prosecuted and not any person who was not in charge of the business. ( 9 ) SIMILARLY, in the case of State of Karnataka v. Pratap Chand, AIR 1981 SC 872 , it was observed as under :"where the partnership firm was charged for the offences under S. 18 (a) (ii) and (c) the partner of the firm who was in overall control of the day to day business of the firm, would alone be liable to be convicted and the partner who was not in such control, could not be proceeded with, merely because, he had the right to participate in the business of the firm under the terms of partnership deed. " ( 10 ) THE above case of State of Karnataka (supra) was under the Drugs and Cosmetics Act, as are the present revision petitions. So, in view of the case of State of Karnataka (SC) the position of the present petitioners, is the same. ( 11 ) THE learned Public Prosecutor before the trial Court had submitted an application alleging that the petitioners were partners of the Firm, M/s. Mehta and Co. , and M/s. Vimal Medical Stores, and so, they were also liable to be prosecuted. The learned trial Court accepted that application. ( 12 ) AFTER considering the arguments of both the learned counsel and going through the case law cited by the learned counsel for the petitioners, I am of the opinion that the learned trial Court has committed error in issuing process against the partners of the firms who were not in charge of the business of the firms or conducting its affairs when the offence is alleged to have been committed. Only the person who was in charge, could be proceeded against and therefore, the prosecution of the petitioners and issue of process for this offence against them, is bad in law so it cannot be maintained. ( 13 ) IN view of my above discussion, all the four revision petitions are hereby accepted, and the order of the learned CJM, Sirohi, dt. 29th Dec. , 81 is set aside. The proceedings in all these revision petitions, are quashed. Order accordingly.