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2009 DIGILAW 449 (KER)

Kedar Apte v. Inspector, Legal Metrology

2009-06-09

C.T.RAVIKUMAR

body2009
Judgment : The Petitioner is the 2nd accused in S.T. No.1421/05 on file of the Judicial First Class Magistrate Court, Changanacherry. He is sought to be prosecuted on the allegations that M/s. Hindustan Lever Limited had committed the offence of violation of R.12(6) of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 ( herein after referred for short 'Rules' only) and that he was its Sales & Customer Manager. The above Crl. M.C. has been filed with the prayer to quash Annexuere-A2 complaint in S.T. 1421/05 on the file of the Judicial First Class Magistrate Court, Changanacherry. The brief facts of the case are as follows:- 2. On 19.11.04, the Inspector of Legal Metrology, Changanacherry, the 1st Respondent, inspected the premises of M/s. S.V. Pai and Brothers, Changanacherry and seized three packages containing Huggies-Nappi pads (with Leak Lock Tape) on the ground that it did not contain the mandatory declarations as envisaged under R.12(6) of the Rules and hence, violated the Rules and S.39 of the Standards of Weights and Measures Act, for short 'the Act' only. Annexure-A1 show cause notice was then issued by the 1st respondent and thereafter Annexure-A2 complaint was filed. On Annexure-A2 complaint, the learned Magistrate took cognizance on 30.5.05 and thereafter issued summons to the petitioner and others. According to the petitioner, continuance of proceedings based on Annexure-A2 complaint in S.T.No.1421/05 would be abuse of process of court and hence, to secure ends of justice, it is liable to be quashed. 3. I have head the counsel for the petitioner and also the learned Public Prosecutor. 4. It was contented by the counsel for the petitioner that Annexure-A2 contained only a very vague averment regarding violation of R.12(6) of the Rules. Further, it was contented that the essential averment to hold him responsible for the offence allegedly committed by the company is conspicuously absent in it. A scanning of Annexure-A2 is worthy in the wake of the said contentions. The averments therein so far as they are relevant read thus: .................................... "During the course of my surprised inspection at the premises of M/s. S.V. Pai and Brother, Changanacherry on 19.11.04, it had been noticed that eight items of the packages as per Seizure Receipt No.37/8, 38/8 and 39/8 did not bear mandatory declarations as envisaged in the said Act and Rules"... "During the course of my surprised inspection at the premises of M/s. S.V. Pai and Brother, Changanacherry on 19.11.04, it had been noticed that eight items of the packages as per Seizure Receipt No.37/8, 38/8 and 39/8 did not bear mandatory declarations as envisaged in the said Act and Rules"... Item No.4 is Huggies Nappi Pads-3 packets, and item No.5 is Lion Dessert King Seedless Dates-3 Packages. Distributor of item No.4 is M/s. V.D. Mathew & Sons, Vattappally, Changanacherry-686 101 and the manufacturer is M/s. Hindustan Lever Ltd., 101, Santhome High Road, Chennai-600028. It's Area Sales and Customer Manager is Sri. Kedar Apte. "....Reply received from M/S. V.D. Mathew & sons was not satisfactory. The others did not submit any reply so far. It is, therefore, inevitable to proceed against the offenders. Hence the complaint". 5. The counsel for the petitioner, after adverting to the averments in the complaint, contented that the allegations regarding the violation of the provisions of the Rules and the Act are too vague and, infact they did not specifically speak of the missing declaration and how and in what manner the declaration on the packages in question, attracts violation of R.12(6) of the Rules. In the absence of such specific averments and specific allegations against the petitioner there is no justification in making the petitioner as accused based on the principle of vicarious liability, it was further contented. That apart, there is no allegation in the complaint attributing business liability on the petitioner. These contentions were raised based on S.74(1) of the Act. 6. Firstly, I may examine the merit of the contention that it contained no specific allegation to hold him responsible for the alleged offence committed by the company. That apart, there is no allegation in the complaint attributing business liability on the petitioner. These contentions were raised based on S.74(1) of the Act. 6. Firstly, I may examine the merit of the contention that it contained no specific allegation to hold him responsible for the alleged offence committed by the company. For the said purpose it is profitable to extract S.74(1) of the Act and the same reads thus: Offences by companies and power of Court to publish name, place of business, etc., of companies convicted.-(1) If an offence under this Act is 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 nothing contained in this sub-section shall render any such person liable to punishment if he proves that the offences was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence. It is obvious from S.74(1) of the Act that every person who, at the time the offence was committed, was in-charge of and responsible to the company for the conduct of the business of the company alone can be held liable to be proceeded against based on the principle of vicarious liability when a company committed an offence under the Act. As noticed hereinbefore, 'it's Area Sales and Customer Manger is Sri. Kedar Apte', is the sole averment made in Annexure-A2 complaint against the petitioner. It is in the said circumstances that the counsel for the petitioner contended that the allegation in Annexure-A2 did not satisfy the requirements under S.74(1) of the Act in as much as it lacks specific averment to the effect that the petitioner was the person in charge of and was responsible to the company for the conduct of business of the company and therefore there is no decision at all to prosecute the petitioner. In support of his contention the counsel for the petitioner placed reliance on the decisions of the Hon'ble Apex Court in S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla reported in (2005 (4) KLT 209 (SC)), Saroj Kumar Poddar v. State (NCT of Delhi) & Anr reported in ((2007) 3 SCC 693) and that of this Court in Vijayakumar & Ors. v. M/s. Lab & General Exports Pvt. Ltd. reported in (2008 (3) KLT 599 = ILR 2008 (3) Ker. 449). S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla (supra) was under the Negotiable Instruments Act, 1881. S.141 therein, in so far as it is relevant reads thus:- (i) "If the person committing an offence under S.138 is a company, every person who, at the time of offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly." A scanning of the above quoted relevant part of S.141 of Negotiable Instruments Act would reveal that the expressions used therein casting criminal liability on the principle of vicarious liability, are akin to the expression used for that purpose under S.74(1) of the Act. In the said decision the Hon'ble Apex Court held:- "It is necessary to specifically aver in a complaint under S.141 that at the time the offence was committed, the person accused was in charge of, and responsible for the conduct of business of the company. This averment is an essential requirement of S.141 and has to be made in a complaint. Without this averment being made in a complaint, the requirements of S.141 cannot be said to be satisfied." Further it was held therein:- "……. Merely being a director of a company is not sufficient to make the person liable under S.141 of the Act. A director of a company cannot be deemed to be in charge of and responsible to the company for the conduct of its business. The requirement of S.141 is that the person sought to be made liable should be in charge of and responsible for the conduct of the business of the company at the relevant time. This has to be averred as a fact as there is no deemed liability of a director in such cases." 7. The requirement of S.141 is that the person sought to be made liable should be in charge of and responsible for the conduct of the business of the company at the relevant time. This has to be averred as a fact as there is no deemed liability of a director in such cases." 7. S.M.S. Pharmaceuticals Ltd.'s case (supra) and the decision of the Hon'ble Apex Court in Saroj Kumar Poddar v. State (N. C. T. of Delhi) reported in ((2007) 3 SCC 693) were followed by this Court in Vijayakumar and Others v. M/s Lab and General Exports Pvt. Ltd. reported in (2008 (3) KLT 599 = I.LR 2008 (3) Ker.449), It was held:- "A careful consideration of all these decisions appears to make it clear that in the complaint specific assertions must be made to attract the play of S.141 of the N.I Act. It has to be pleaded as a fact that the indictees concerned are in charge of and responsible to the company for the conduct of it affairs. Once that allegation is specifically raised, it is for the complainant to adduce evidence in support of such assertion later. A ritualistic incantation of the words of the statute may not be expected or insisted. But it has got to be effectively conveyed as a matter of fact that the accused persons were in charge of and responsible to the company for the conduct of its affairs on the date of the offence. Such averments, if they are there, they can be attempted to be supported later at the stage of enquiry under S.200/202 of the Cr. P.C or at the later stages of the trial. It is trite in the law of pleadings that what is to be pleaded is the facts and not evidence to be adduced in support of such facts." 8. Decisions under other statutes carrying similar provisions with cognate expressions also assume relevance in the context of the contentions of the counsel for the petitioner. In Tropical Agro System (P) Ltd. v. State of A.P. reported in (1990 Cri. L.J. 2739), the decision was under S.33 of the Insecticides Act, 1968 and the decisions in State of Gujarat v. Gopishankar S. Vaid Shah reported in (2000 (4) Cri. L.J. 4320), was under the Prevention of Food and Adulteration Act, 1955. In Tropical Agro System (P) Ltd. v. State of A.P. reported in (1990 Cri. L.J. 2739), the decision was under S.33 of the Insecticides Act, 1968 and the decisions in State of Gujarat v. Gopishankar S. Vaid Shah reported in (2000 (4) Cri. L.J. 4320), was under the Prevention of Food and Adulteration Act, 1955. In both the cases absence of specific allegations against the indictees relating their business liability to attach criminal liability based on the principle of vicarious liability, led to the quashing of the proceedings against them. In the latter case, the factum of no-nomination as contemplated in law, was also taken as a ground for such quashment. 9. What is emerging from the discussions on similar provisions under other statutes carrying cognate expressions, in the light of the purpose of S.74(1) of the Act, is that specific averments relating business liability to attach criminal liability based on the principle of vicarious liability, against the indictee to the effect that he was the person in-charge of and was responsible to the company for the business of the company is to be made in a complaint lest he cannot be prosecuted for commission of offence by a company. under the Act. This has to be averred as a fact since there cannot be any deemed liability of any person in such cases merely based on his holding an office in the concerned company. In this case sufficiency or otherwise of the averments in Annexure-A2 complaint has to be considered bearing in mind the aforesaid position of law, the provisions under S.74(1) of the Act in the light of the powers of a Magistrate under Ss.200 to 204 of the Code of Criminal Procedure. A conjoint reading of Ss.203 and 204 of the Code of Criminal Procedure would make it abundantly clear that the Magistrate has to apply his mind, to form an opinion regarding the existence or otherwise of a prima facie case to proceed further with the case. on the allegations incorporated in complaint/F.I.R. 10. In this case, a scanning of Annexure-A2 complaint, as noticed hereinbefore, would show that except the description of the petitioner as the Area Sales and Customer Manger of Hindustan Lever Ltd., there is absolutely nothing therein to hold the petitioner liable to face prosecution for the alleged violation of R.12(6) of the Rules by the company. In this case, a scanning of Annexure-A2 complaint, as noticed hereinbefore, would show that except the description of the petitioner as the Area Sales and Customer Manger of Hindustan Lever Ltd., there is absolutely nothing therein to hold the petitioner liable to face prosecution for the alleged violation of R.12(6) of the Rules by the company. There is no other specific allegations against the petitioner and I am not required to look into the question of vagueness in relation to the allegation against the company in the circumstances. The concerned company is also not joined as an accused in this case. The aforesaid description regarding the office held by the petitioner in the company falls much short of the requirement under S.74(1) of the Act. The absence of specific averment against the petitioner that he was in charge of and was responsible to the company for the business of the company, during the relevant point of time, in the circumstances make the proceeding undeserving to be proceeded against the petitioner. The outcome of the discussions is essentially the conclusion that there is no justification in the action in taking cognizance against the petitioner and to issue process against him, on Annexure-A2 complaint. It be so, allowing continuance of proceedings against the petitioner based on Annexure-A2, in S.T.No.1421/05 on the file of the Judicial First Class Magistrate Court, Changanacherry will result in abuse of process of Court and therefore to secure interest of justice, the proceeding against the petitioner is to be quashed. Accordingly, the proceedings against the petitioner based on Annexure-A2 complaint is hereby quashed and consequently no proceeding shall-be continued as against the petitioner in S.T.No.1421/05, on the file of the Judicial First Class Magistrate Court, Changancacherry. The above Crl.M.C is allowed accordingly.