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2004 DIGILAW 555 (RAJ)

Ashok H. Maheshwari : Toshniwal Drugs and Pharmaceuticals v. State of Rajasthan

2004-04-09

N.N.MATHUR

body2004
JUDGMENT 1. - Both the petitions under section 482 of the Code of Criminal Procedure are directed against the order dated 28.1.1995 passed by the Chief Judicial Magistrate, Chittorgarh taking cognizance against the petitioners for offence under section 17-A r/w Section 27-B of the Drugs and Cosmetics Act. 2. Briefly stated the facts of the case are that the Drugs Inspector, Chittorgarh namely Janak Raj Bhatia filed a complaint against M/s. Anil Medical Store, Chittorgarh through Ramesh Chandra Inani and its partners, M/s. Vikas Pharma Distributors, Jaipur through its partners and M/s. Rubi Pharma, Delhi through its partners in all 22 accused persons along with an application for condonation of delay and extending the period of limitation beyond 3 years under section 473 r/w Section 468(2) of the Code of Criminal Procedure. The learned Magistrate condoned the delay and extended the time for filing the complaint. By the impugned order the cognizance has been taken against the petitioners for the offences under the Drugs and Cosmetics Act as already noticed. 3. It is alleged that the Drug Inspector namely C.B. Gupta inspected the M/s. Anil Medical Store, Chittorgarh on 24.10.1989 and purchased a medicine by name Relax B tablet. The medicine was sent for the chemical examination on 20.12.1989. The report of the Chemical Analyst was received on 20.3.1990. Some clarification was sought by the Drug Inspector from the Chemical Analyst, who under communication dated 10.4.1990 informed that the drug was in the bad condition and not fit for human consumption. The expiry date of the drug was June, 1990. After investigation and completing the formalities, complaint was filed on 5.10.1993 in the Court of Chief Judicial Magistrate, Chittorgarh. The learned Magistrate has condoned the delay and taken the cognizance by the impugned order. 4. I have heard Mr. J.P. Joshi learned counsel for the petitioners in S.B. Criminal Misc. Petition No. 193/1995 and Mr. Sandeep Mehta learned counsel for the petitioners in S.B. Criminal Misc. Petition No. 409/1995. I have also heard the learned Public Prosecutor and perused the record. Various contentions have been raised challenging the order of taking cognizance. However, it is not necessary to deal with all the contentions as in my opinion the petition deserves to succeed on the single ground. Petition No. 409/1995. I have also heard the learned Public Prosecutor and perused the record. Various contentions have been raised challenging the order of taking cognizance. However, it is not necessary to deal with all the contentions as in my opinion the petition deserves to succeed on the single ground. It is submitted that according to Section 34 of the Act only those persons can be held guilty of offence under the Act committed by a company, who at the time of commission of such an offence are incharge of and responsible to the company as well as the company. It is further submitted that in this regard there must be a clear averment in the complaint that the person against whom the complaint is filed was responsible to the company for the conduct of the business of the company at the time when the sample was taken. But in the instant case there is no such averment in the complaint against the petitioners. There is no allegation that the offence was committed with the consent or connivance or is attributed to any neglect on part of the Director, Manager, Secretary,Partner or any other officer of the company. Thus, there is nothing on record to show that any offence has been committed by the petitioners and the complaint is liable to be quashed. In support of the contention reliance has been placed on the decision of the Apex Court in State of Karnataka v. Pratap Chand and Ors. reported in AIR 1981 SC page 872 : 1981 Cr. L.R. (SC) 205 . On the other hand the learned Public Prosecutor has supported the order of the learned Chief Judicial Magistrate. 5. I have considered the rival contentions and perused the record. In order to appreciate the contentions, it would be apt to read Section 34 of the Act, which is extracted as follows : "34. L.R. (SC) 205 . On the other hand the learned Public Prosecutor has supported the order of the learned Chief Judicial Magistrate. 5. I have considered the rival contentions and perused the record. In order to appreciate the contentions, it would be apt to read Section 34 of the Act, which is extracted as follows : "34. Offences by companies.-(1) Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of, 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 the offence and shall be liable to be proceeded against and punished accordingly : Provided that noting contained in this sub-section render any such persons liable to any punishment provided in this Act if he proves that the offences was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence. (2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or it attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation.-For the purpose of this section (a) "company' means a body corporate, and includes a firm or other association of individuals; and (b) "director" in relation to a firm means a partner in the firm." 6. The above section came to be interpreted by the Apex Court in G.L. Gupta v. D.N. Mehta reported in AIR 1971 SC page 28 , wherein it was observed as follows:- "What then does the expression "a person in charge and responsible for the conduct of the affairs of a company mean"? It will be noticed that the word 'company' includes a firm or other association and the same test must apply to a director in charge and a partner of a firm in charge of a business. It will be noticed that the word 'company' includes a firm or other association and the same test must apply to a director in charge and a partner of a firm in charge of a business. It seems to us that in the context a person 'in charge' must mean that the person should be in over all control of the day to day business of the company or firm. This inference follows from the wording of Section 23-C(2). It mentions director, who may be a party to the policy being followed by a company and yet not be in charge of the business of the company. Further it mentions manager, who usually is in charge of the business but not in overall-charge. Similarly the other officers may be in charge of only some part of business." The above passage has been quoted with approval by the Apex Court in State of Karnataka v. Pratap Chand and Ors. (supra). 7. In the instant case the petitioners in S.B. Criminal Misc. Petition No. 409/1995 namely Ashok H. Maheshwari, Arvind A. Maheshwari, N. Mohan and S. Dutta were inducted as additional directors on 18.7.1990. Thus, what to talk of, that they were over-all in charge of the company, they were not even on the board of directors of the company on the date when the sample was taken i.e. on 24.10.1989. Similarly in S.B. Criminal Misc. Petition No. 193/1995 petitioners are the directors of M/s. Toshniwal Drugs and Pharmaceuticals Pvt. Ltd. There is nothing to show that they were in any way over all in charge in the business of the company. Similarly in S.B. Criminal Misc. Petition No. 193/1995 petitioners are the directors of M/s. Toshniwal Drugs and Pharmaceuticals Pvt. Ltd. There is nothing to show that they were in any way over all in charge in the business of the company. The only averments made in the complaint in Para 37 are as follows " mijksDr rF;ksa ds vk/kkj ij vfHk;qDr la[;k 2] 3] 4] 5] 7] 8] 9] 11] 12 ,oa vfHk;qDr QeZ la[;k 1] 6 ,oa 10 ds }kjk voekud dksfV dh ?kksf"kr vkS"kf/k ,oa ekud mi;ksx gsrq mi;ZqDr ugha vkS"kf/k fjysDl ;w0 VscysV cSp ua0 7751] fuek.kZ frfFk tqykbZ 1987] vof/k ikj tqu 1990] fuekZrk eSllZ rks"kuhoky M~x ,.M QkekZL;qfVdYl] izk0fy0] U;w nsgyh ds dz; dj fodz; gsrq laxzg.k] forj.k dj ds vkS"kf/k ,oa izlk/ku lkexzh vf/kfu;e] 1940 dh /kkjk 18&, ( 1 ) dk mYya?ku fd;k gS tks vf/kfu;e dh /kkjk 27&Mh ds rgr n.Muh; gSA vfHk;qDr QeZ la[;k&13 ,oa vfHk;qDr la[;k 14 ls 22 ds }kjk voekud dksfV dh ?kksf"kr ,oa ekuo mi;ksx gsrq mi;qZDr ugha vkS"kf/k fjysDl ;w VscysV] cSp ua0 77551 dk fuekZ.k dj fodz; gsrq ftEesnkj gS us vkS"kf/k ,oa izlk/ku lkexzh vf/kfu;e] 1940 dh /kkjk 18&, ( 1 ) dk mYya?ku fd;k gS tks vf/kfu;e dh /kkjk 27&Mh ds rgr n.Muh; gSA " 8. It is evident that the only allegation made in the complaint is that the offence was committed by the company with the consent, knowledge and connivance of its directors and the officers. There is no allegation that so far as the present petitioners in either of the petitions are concerned any of them was responsible for the company for its conduct and business. In these circumstances, in my opinion continuation of proceedings against the petitioners would be an abuse of the process of the Court and is liable to be quashed. 9. Consequently, both the petitions are allowed. The order dated 28.1.1995 passed by the Chief Judicial Magistrate, Chittorgarh taking cognizance against the petitioners for various offences under the Drugs and Cosmetics Act qua the petitions stand quashed.Petitions allowed. *******