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2008 DIGILAW 259 (MAD)

Managing Director v. Government of India, rep. by Shri Shivsagar Verma

2008-01-25

K.N.BASHA

body2008
Judgment : 1. The learned counsel appearing of the petitioners submit that the petitioners have came forward with this petition seeking to quashed the proceedings initiated against them in STC No. 1772 of 2006 on the file of the Judicial Magistrate, Palani for the alleged offence under Section 29(a)(i) of the Insecticides Act, 1968. 2. Mr. V. Karthik, learned counsel appearing for the petitioners contended that the prosecution has been initiated against the petitioners by mentioning their individual name and also mentioning their designation in respect of the Company namely Hyderabad Chemical Supplies Ltd. It is contended by the learned counsel for the petitioners that as per provision 31 of the Insecticides Act, 1968, the prosecution is bound to obtain sanction against each one of the accuse mentioning specifically their names. But, as far as the instant case in concerned, the prosecution admittedly obtained sanction only against the Company that is namely Hyderabad Chemical Supplies Ltd., and the Trader who has been arrayed as A-3 in this case. 3. It is submitted by the learned counsel for the petitioners than the petitioners have been arrayed as A-1 and A-2. The learned counsel also submitted that the prosecution having not obtained any individual sanction as far as he petitioners who have been arrayed as A-1 and A-2, the proceedings initiated as against them is liable to be quashed in view of the specific provision contained under Section 31 of the Insecticides Act, 1968 (hereinafter referred to as “the Act”). In support of his contention, the learned counsel placed reliance on decision of the Honourable Apex Court in (2000) 2 MWN (Crl) 241 and another decision of Rajasthan High Court in 1991 Crl. L.J. 2645. 4. Per contra, the learned Central Government Standing Counsel appearing for the respondent vehemently contended than the complainant has obtained sanction against the company and for the Company, the petitioners namely A-1 and A-3 have been in charge and responsible for the day-to-day affairs and as such the sanction obtained against the Company itself is sufficient and there is no illegality and infirmity in the sanction and as such no ground is made out by the petitioners to quash the proceedings. 5. 5. It is submitted by the learned Central Government Standing counsel appearing for the respondent by placing reliance on the provision under Section 33 of the act relaying to the offences by companies, it is contended that for an offence committed by a Company every person who at the time the offence was committed was in charge of, or was responsible to the Company for the conduct of the business of the company shall be deemed to be guilty of the offence and as such the sanction obtained against the company itself is sufficient. The learned Central Government Standing counsel also placed reliance on a decision reported in 1985 Crl. L.J. 187. 6. I have heard the rival contentions put forward by either side and also perused the impugned complaint and the other materials available on record. 7. The main question arises for consideration in this cane is whether the sanction obtained by the prosecution to initiate proceedings against the petitioners who have been arrayed as A-1 and A-2 is valid as much as the sanction obtained only in the name of the company, for which the petitioners are the managing Director and the Manager of he said company. It is seen that Section 31(1) of the Act relating to cognizance and trial of offence, reads hereunder: “31. Cognizance and trial of offences:- (1) No prosecution for an offence under this Act shall be instituted except by, or with the written consent of, the state Government or a person authorized in this behalf by the State Government.” 8. The above reading of the provision under Section 31 of the Act makes it crystal clear that any prosecution in order to initiate prosecution against any person, the mandatory requirement is to obtain consent or sanction form the competent authority namely the State Government or any person authorized on behalf of the State government. 9. The learned counsel appearing for the petitioners rightly placed reliance on the decision of the Honourable Apex Court reported in , (supra). In that decision the Honourable Apex Court has dealt with the provision contained under the Prevention of Food Adulteration Act more particularly in respect of the specific provision namely Section 20 of the Prevention of Food Adulteration Act dealing with the very same aspect of obtaining sanction before initiating prosecution against any person. In that decision the Honourable Apex Court has dealt with the provision contained under the Prevention of Food Adulteration Act more particularly in respect of the specific provision namely Section 20 of the Prevention of Food Adulteration Act dealing with the very same aspect of obtaining sanction before initiating prosecution against any person. The Honourable Apex Cut has held in paragraph 5 as stated below: 5. That apart, we find that when sanctioned was sought for by the appellant, the Director Health Services, Trivandrum granted sanction on 22.1.1990 to prosecute A-1 only. No sanction for prosecution of A-2 or A-3 was granted. How the trial Court issued process against A-2 and A-3 is not understandable. That apart, in the absence of sanction for prosecution of A-2, we fail to appreciate how A-1 could be prosecuted, in the established facts as emanating from the complaint. Before issuing process, the trial Court ought to have looked into all these aspects. It failed to do so. There was nothing in the complaint which could justify issuing of process against A-1, since the cash memo did not show the sale of any misbranded food article. The trial Court ought not to have taken cognizance of the complaint which did not even lay down proper factual matrix for proceeding further. The High Court, therefore, rightly quashed the complaint and the proceedings taken by the learned Additional Chief Judicial Magistrate, Trivandrum. We uphold the order of the High Court, though for different reasons stated herein above”. 10. It is pertinent to be noted that the provision contained under Section 20 of the Prevention of Food Adulteration Act is similar to the provision contained under Section 31 of the Act, relating to obtaining of sanction for initiating prosecution. Therefore, this Court has no hesitation to hold that sanction was obtained duly in the name of the company, for which the petitioners who have been arrayed as A-1 and A-2, Managing Director and the Manager of the company and further it is not mentioned that they are representing the Company, as such the proceedings initiated against them is liable to be quashed. 11. The learned counsel for the petitioners placed reliance on the decision in , (supra) which relates to the provision under the Insecticides Act. 11. The learned counsel for the petitioners placed reliance on the decision in , (supra) which relates to the provision under the Insecticides Act. In that decision, the Rajasthan High Court has held that consent of sanction for prosecution should be by name and complaint filed against persons against whom no consent was accorded, not maintainable. 12. The learned Central Government Standing Counsel by placing reliance of Andhra Pradesh Judgment in (supra) invited this Courts attention regarding the specific provision under Section 33 of the act relating to the offence by companies, Section 33 of the Act reads as follows: “33. Offences by Companies:- (1) Whenever 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, or 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.” It is contended by the learned Central Government Standing Counsel that in the decision cited supra, the Andhra Pradesh High Court has held that the sanction was also obtained against the one of the accused viz. the Company, apart from other accused. The High Court of Andhra Pradesh has held in that decision that obtaining a sanction against a company itself is sufficient and legal to proceed against its Managing Director for contravention and violation of the provisions of the Act. 13. It is relevant to refer the sanction order as incorporated in the decision cited supra which reads as follows : “Sanction is hereby accorded to the Dy. Director of Agriculture, Anantapur for launching prosecution against Sri Surapuraja Venkatanarayana Rao of Sri Balaji Fertilizers, 12/43 H, New Bus stand, Tadepatri (dealer) Sri. A. Abdul Ghaffar Kahdervalli Managing Partner Distributors for I.C.I. Tadepatri and Travancore Chemical and Manufacturing Co. Ltd. Alwaye-4 represented by its Managing Director for contravention and violation of the provisions of the Act and for selling….” A reading of the above said sanction order as incorporated in the decision of the Andhra Pradesh High Court clearly shows that apart from other accused, sanction order was also obtained in respect of a Company, viz. Trivancore Chemical Manufacturing Co. Ltd. Always - 4 represented by its Managing Director. Trivancore Chemical Manufacturing Co. Ltd. Always - 4 represented by its Managing Director. But as far a the instant case is concerned, it is pertinent to be noted that the sanction order was obtained only in the name of the company, viz. Hyderabad Chemical Supplies Limited, Hyderabad, as stated in the complaint itself and it is also not stated that the company is represented by the petitioners herein and there is no sanction accorded to initiate criminal proceedings in respect of the petitioners mentioning their name in the sanction order. Therefore, this Court is of the considered view that the decision cited viz. (supra) of the Andhra Pradesh High Court is not applicable to the facts of the instant case as in the instant case, the admitted fact remains that the prosecution obtained sanction only in the name of the petitioners also not mentioned to the effect that they are representing the Company. 14. The learned Central Government Standing Counsel has also made a vain attempt to distinguish the decision of the Honourable Apex Court in, (supra) relied on by the learned counsel for the petitioners, by placing reliance on the facts of the particular case namely relating to the offence of misbranding and the learned Central Government Standing Counsel has invited this Court to look into the allegations of the case. At the risk of repetition, it is to be stated that the Hon‘ble Apex Court in the decision cited supra has dealt with a similar provision relating to obtaining sanction under the Prevention of Food Adulteration act for instituting the prosecution and as such the decision rendered by the Hon‘ble Apex Court is squarely applicable to the instant case as in this case also similar points involved regarding the validity of sanction. Therefore, for the reasons stated above, this Court is left with no other alternative except to quash the proceeding initiated in STC No. 1772 of 2006 on the file of the Judicial Magistrate, Palani, an far as the petitioners are concerned. It is made clear that it is open to the prosecution to take any action against the petitioners in accordance with law. The petition is ordered accordingly.