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2006 DIGILAW 651 (CAL)

ABL INTERNATIONAL LIMITED v. STATE OF WEST BENGAL

2006-09-27

S.P.TALUKDAR

body2006
S. P. TALUKDAR, J. ( 1 ) PETITIONERS by filing the instant application under section 482 of the Code of Criminal Procedure sought for quashing of proceeding in Case No. C-6338/05 now pending before the learned 3th Court of Metropolitan Magistrate, Calcutta, under section 85 (a) of the ESI Act, 1948. ( 2 ) GRIEVANCES of the petitioners may briefly be stated as follows: petitioner No. 1 is a Public Limited Company and petitioner Nos. 2 to 4 are Directors of the said company who are involved in framing broad policy matters of the company and are not connected with the day-to-day running of the business of the company. ( 3 ) THE petitioners had been falsely inplicated in the case on the accusation of having failed to pay the employers and employees share of contribution for the period from July, 2003 to September, 2003 under the ESI Act, 1948 and ESI (General) Regulations, 1950 (as amended ). By order dated 12th July, 2005 the learned Magistrate after taking cognizance directed issuance of summons. The petitioners received a notice from the opposite party calling upon them to make payment of Rs. 3,04,447. 00 in respect of certificate No. C/ins-1/41-0432 dated 22nd June, 2005 as employers' and employees' share of contribution for the period from April, 2003 to January, 2004 along with interest of Rs. 100. 25p. ( 4 ) UPON receipt of such notice, the entire dues along with interest were paid by the petitioner No. 1 company. In view of such payment thereby clearing all the dues continuation of the impugned proceeding will be an abuse of the process of law. The allegations made in the petition of complaint do not disclose the essential ingredients of the alleged offence against the petitioners. ( 5 ) PETITIONER Nos. 2 to 4 cannot be stated to be the "principal employer" under section 40 of the ESI Act, 1948. ( 6 ) BEING aggrieved by, and dissatisfied with, the initiation and/or continuation of the impugned proceeding being Case No. C-6338/05 pending before the learned 3rd Court of Metropolitan Magistrate, Calcutta, the petitioners filed the instant application with a prayer for quashing of the proceeding. ( 7 ) OPPOSITE Party No. 2 by filing an affidavit-in-opposition denied that petitioner Nos. 2 to 4 are in no way connected with the running of the business of the petitioner No. 1 company. ( 7 ) OPPOSITE Party No. 2 by filing an affidavit-in-opposition denied that petitioner Nos. 2 to 4 are in no way connected with the running of the business of the petitioner No. 1 company. On 8th March, 2004 at the time of inspection of the establishment of the petitioner No. 1 company by the Inspector of the employees' State Insurance Corporation, the company's representative provided with the names of the petitioner Nos. 2 to 4 who were in charge of, and responsible to, the company. The said petitioner Nos. 2 to 4 were in charge of the day-to-day running of the business of the company and, as such, they had been prosecuted for the offence under section 85 (a) of the said Act. ( 8 ) PETITIONERS No. 2 to 4 failed to pay the employers share as well as the employers' share of E. S. I contributions for the period from July, 2003 to september, 2003 within the prescribed limit and, thus, committed offence under section 85 (a) of the said Act. ( 9 ) SUCH O. P. No. 2 further claimed that there had been delay in the matter of payment which could not be made within the prescribed period as provided under Regulation 31 of the E. S. I (General) Regulations, 1950. It was further stated that the claim of payment of the entire dues along with the interest thereon as made on behalf of the petitioners can be best appreciated by the learned Court of Magistrate and even assuming that such had been made, that could be no ground for quashing of the proceeding. Petitioner No. 2 to 4 had been prosecuted as "occupier/persons in charge of day to day matters" of the Company and not as principal employer. Dismissal of the revisional application was so prayed for. ( 10 ) ON behalf of the petitioner it was submitted that the Code cannot afford to ignore the subsequent developments. Laying emphasis on the claim that the entire amount with interest thereon having been deposited, there can be no rational justification for proceeding further with the case. ( 11 ) ATTENTION of the Court was drawn to the decision in the case of Howrah motor Company Limited and Ors. vs. Samir Kumar Das, reported in 2004 (4)CHN 291 . Laying emphasis on the claim that the entire amount with interest thereon having been deposited, there can be no rational justification for proceeding further with the case. ( 11 ) ATTENTION of the Court was drawn to the decision in the case of Howrah motor Company Limited and Ors. vs. Samir Kumar Das, reported in 2004 (4)CHN 291 . The learned Single Bench of this Court did not find any justification for continuance of the proceeding after payment of the entire dues. ( 12 ) IN the said case, learned Judge relied upon the judgment and decision in the case of Adoni Cotton Mills Limited vs. Regional Provident Fund commissioner and Ors. , reported in 1995 Suppl (4) SCC 580 and Jasoda Glass and Silicate and Ors. vs. Regional Provident Fund Commissioner and Ors. , reported in 2002 (2) CHN 407 . Significantly enough, in the said case of howrah Motor Company Limited and Ors. , the learned Single Bench of this court took note of the order passed by the learned Magistrate indicating that payment of the entire dues had been made by instalments. The case under reference related to failure on the part of the petitioners to transfer provident Fund contributions to the Board of Trustees for a particular period. ( 13 ) IN the case of Jasoda Glass and Silicate and Ors. , the learned Division bench of this Court took note of the fact that the Hon'ble Supreme Court in the Adoni Cotton Mills Ltd. case (supra) quashed the proceedings for prosecution initiated on the notices to show cause as to why prosecution for default should not be taken under sections 14 and 14a of the 1952 Act since the amount in default had been partly deposited and partly secured. ( 14 ) IN the case before the learned Division Bench, the appellants had also deposited the entire dues which were allegedly outstanding on the strength of the orders passed from time to time. In the case of Adoni cotton Mills Ltd. and Ors. (supra) there had been a default on the part of the company to make deposits for the months of April to July, 1976. In the case of Adoni cotton Mills Ltd. and Ors. (supra) there had been a default on the part of the company to make deposits for the months of April to July, 1976. The company as well as the appellants were given notices as to why they should not be prosecuted for the default under sections 14 and 14a of the employees' Provident Fund and Miscellaneous Provisions Act, 1952 and section 15 of the Additional Emoluments (Compulsory Deposit) Act, 1974 read with sections 406 and 409 of the Indian Penal Code. The appellants on receipt of these notices filed two writ petitions. The said petitions were dismissed and such order of dismissal was challenged by preferring appeal before the Apex Court. ( 15 ) THE Apex Court in the said case took into consideration the fact that the prosecution was initiated in respect of certain offences alleged to have been committed fifteen (15) years back. Two of the appellants subsequently died. The offence alleged was the failure to deposit the amounts for a short period of four months immediately following the discharge of the appellant company from the receivership. During pendency of the appeal, the Supreme court granted stay of further preceding by way of prosecution on condition that the appellants deposited an amount of Rs. 40,000/- and furnished a bank guarantee for Rs. 60,000/- The said direction was duly complied with. The Hon'ble Court also took into consideration the fact that there was default to the extent of about Rs. 90,000/- only. After taking into consideration all such facts and circumstances, the Apex Court took the view that this was a case in which the proceedings by way of prosecution could not be pursued provided the amounts deposited in the Court and secured by the bank guarantee are paid over to the Regional Provident Fund Commissioner for credit to the appropriate accounts. All these factors were taken into consideration while quashing the proceeding. ( 16 ) THE decision in the case of Jasoda Glass and Silicate and Ors. , was also in connection with an appeal which was directed against the summary rejection of the writ petition filed by the appellants, inter alia praying for quashing of the various complaint cases pending before the learned Chief judicial Magistrate, Barasat. ( 16 ) THE decision in the case of Jasoda Glass and Silicate and Ors. , was also in connection with an appeal which was directed against the summary rejection of the writ petition filed by the appellants, inter alia praying for quashing of the various complaint cases pending before the learned Chief judicial Magistrate, Barasat. It was urged on behalf of the appellants that the complaint filed by the Regional Provident Fund Commissioner were incompetent as the same were based on adjudication said to have been under section 7a of the Employees' Provident Fund and Miscellaneous provisions Act, 1952 but in respect whereof no notices had been served on the appellants. It was alleged that the section 7a proceedings had been conducted behind the back of the writ petitioners and, as such, were liable to be quashed. ( 17 ) RELYING upon various judgments it was urged before the learned division Bench that the criminal prosecutions were liable to be quashed since the entire arrear Provident Fund dues had been liquidated. The learned division Bench after taking into consideration the fact that all the dues, which allegedly remained outstanding, were deposited on the strength of the orders passed from time to time and in such backdrop the appeal was disposed of with leave to the appellants to file separate affidavit to the learned trial Court in each of such separate complaint and the learned Trial Court was directed to take steps for dropping the proceedings in respect of which payments had been made. ( 18 ) ON behalf of the petitioners it was contended that in view of such stand taken in respect of certain cases, the other petitioners or appellants in connection with identical proceeding also deserve to be provided equally. Article 14 of the Constitution gives the citizens fundamental right to have equal protection of the laws and the citizens are further assured of equality before law. Article 14 of the Constitution gives the citizens fundamental right to have equal protection of the laws and the citizens are further assured of equality before law. Referring to the decision in the case of State of Orissa vs. Debendra nath Padhi, reported in 2005 (1) SCC 568 , it was further submitted on behalf of the petitioners that the power of the High Court under section 482 of the criminal Procedure Code and Article 226 of the Constitution is unlimited whereunder in the interests of justice the High Court can make such orders as may be necessary to prevent abuse of the process of any Court or otherwise to secure the ends of justice within the parameters laid down in Bhajan Lal case, 1992 Supp. (l) SCC 335. ( 19 ) ACCORDING to learned Counsel for the petitioners the present Act being the Employees' State Insurance Act deserves treatment identical to the employees' Provident Fund and Miscellaneous Provisions Act. ( 20 ) BEFORE proceeding further, it is perhaps necessary to mention that the Employees' State Insurance Act is a legislation which aims at bringing about social justice to the poor labour class. Such Act introduces the compulsory insurance of a specified class of wage earners. ( 21 ) IT was submitted by Mr. Basu on behalf of the petitioner that the law which has been earlier laid down, either by Division Bench of this Court or by the Apex Court, must govern the construction of the relevant provision. Reference was made in this context to the decision in the case of State of assam and Anr. vs. Deva Prasad Barua and Anr. , reported in AIR 1969 SC 831 . ( 22 ) MUCH was submitted on behalf of the petitioner referring to the decision of the Apex Court in the case of State of Orissa vs. Debendra Nath Padhi, reported in 2005 (1) SCC 568 . Before proceeding further it is perhaps necessary to mention that in none of the judgments, as referred to on behalf of the petitioners, it was laid down that depositing the dues subsequent to filing of criminal prosecution should automatically bring the said proceeding to an end. Thus it cannot be said that this Court must follow the precedent and, accordingly, must quash the criminal proceeding. Thus it cannot be said that this Court must follow the precedent and, accordingly, must quash the criminal proceeding. ( 23 ) I am afraid, such an argument will in effect amount to an attempt to read more than what meets the eyes. It is only expected that the regular offenders in cases arising out of default in payment of P. F. or employer's and employees' shares of the contribution under the provision of ESI Act do not take advantage of a situation whereby the criminal prosecutions against them can be quashed in view of deposits made subsequent to initiation of the said cases. The facts and circumstances of the cases relied upon the learned Counsel for the petitioners are significantly separate and distinct from those of the present case. Besides, as stated earlier, it cannot be said that law has been so laid down which demands quashing of the proceedings arising out of default in depositing the employer's and employees share of provident Fund or other statutory payment as also. ( 24 ) ESI Act like the Employees' Provident Fund and Miscellaneous provisions Act is a social legislation which is a weapon in the hands of the working class in order to get whatever is due to them. Non-depositing of the statutory amount, in fact, is an offence which cannot always be washed by subsequent payment. ( 25 ) IT is perhaps not necessary to mention that the Apex Court has the constitutional authority to pass an order as is necessary for doing complete justice in any case or matter pending before it. This Court certainly does not share the said position. ( 26 ) WHILE analysing the facts and circumstances of the present case, I think that right approach would be to search for the relevant principles and then it is to be seen what is the situation so far as precedent is concerned. In the present case, the common sense view demands that the offenders in cases like the present one cannot be just allowed to wash their hands off at their own sweet will. It cannot be denied that they are the architects of their own misfortune as they failed or neglected to deposit the statutory amount. In the present case, the common sense view demands that the offenders in cases like the present one cannot be just allowed to wash their hands off at their own sweet will. It cannot be denied that they are the architects of their own misfortune as they failed or neglected to deposit the statutory amount. It also cannot be denied that there is no precedent as such which dictates the court to quash a proceeding merely on the ground that the accused persons subsequent to filing of the criminal case deposited the necessary amount. ( 27 ) CONSIDERING all such facts and circumstances, I find it difficult, if not impossible, to accept the stand taken by the petitioners and there is no reason whatsoever so as to justify quashing of the proceeding. The case under reference is just born, in the sense, the learned Court has directed issuance of summons after taking cognizance. There is no reason for the accused persons for not presenting themselves either physically or through learned Counsel before the learned Court. ( 28 ) THIS is all the more important in the context of the socio-economic backdrop of our country. The fruits of struggle of the millions and millions of workers, some half fed, some bare footed are in the form of such social legislations. The element of statutory compulsion as laid down in such acts, in my opinion, does not deserve to be frustrated. ( 29 ) ACCORDINGLY, I find no merit in the grievances, as ventilated on behalf of the petitioners. The present application being C. R. R. No. 3932 of 2005 be dismissed. Interim order, if any, stands vacated. ( 30 ) SEND a copy of this order to the learned Trial Court for information and necessary action. Points raised in the application may very well be ventilated before the ld. Trial Court and if so done, ld. Court may consider the same in proper perspective without being guided by any observation made herein. ( 31 ) CRIMINAL Department is directed to supply urgent certified copy in compliance with due formalities. Appeal dismissed.