ORDER : The petitioner - accused has sought for quashing the entire proceedings in C.C. No.1149/2011 pending on the file of the Judicial Magistrate, I Class, Mangaluru. 2. Heard Sri Ashok Haranahalli, learned Senior counsel appearing for the petitioner and learned counsel for the respondent. Perused the records. 3. The facts leading to this petition are that the complainant - Labour Enforcement Officer (‘Inspector’ and ‘Assistant Public Prosecutor’ under the Contract Labour (Regulation and Abolition) Act, 1970) has filed a complaint against the petitioner on the allegations that (i) the accused was found executing the work through contract labour without obtaining license in violation of Section 12(1) of the Contract Labour (Regulation and Abolition) Act, 1970 (hereinafter referred to as the ‘Act’ for brevity); (ii) the accused failed to display an abstract of the Act of Rules in the form approved by the Chief Labour Commissioner (Central) in English, Hindi and in local language in breach of Rule 79; (iii) the accused failed to issue employment cards in Form XIV to the workers within three days of their employment; (iv) the accused failed to maintain registers of Deductions in Form XX and Files in Form XXI and Advances in Form XXII (v) the accused failed to maintain Register of Overtime in form XXIII, thereby he has committed the offences. 4. The first and the foremost contention of the learned Senior counsel for the petitioner is that the petitioner – accused was only a share holder in the Company. He was not in charge of the day to day affairs or management of the Company. Thus, he cannot be saddled with the liability for offences said to have been committed by the Company. If the Company has committed any offences, the competent person who is in charge of the Company affairs should have been prosecuted. There are no averments in the complaint as to how this petitioner is connected with the affairs of the Company. The petitioner being only a share holder he could not even be held vicariously liable for the wrongful acts alleged to have been committed by the Company. In support of the submission the learned counsel for the petitioner has relied on the decision reported in 2016 (6) SCC 78 in the case of TAMIL NADU NEWS PRINT AND PAPERS LIMITED VS. D KARUNAKAR AND OTHERS. 5. In support of the submission the learned counsel for the petitioner has relied on the decision reported in 2016 (6) SCC 78 in the case of TAMIL NADU NEWS PRINT AND PAPERS LIMITED VS. D KARUNAKAR AND OTHERS. 5. Per contra, the learned counsel for the respondent submitted that the complainant initiated the proceedings against the Company for several violations as per the provisions of the Act. The petitioner has not given clarification about his liability. Even the reply said to have been given by the Company do not disclose that the petitioner is not liable for the acts committed by the Company. 6. On giving thoughtful consideration to the arguments advanced by the learned Senior counsel for the petitioner and the respondent, the question that arises for determination is that, “Whether the petitioner is liable for prosecution under Sections 23 and 24 of the Contract Labour (Regulation and Abolition) Act, 1970, for the alleged offences ? ” 7. It is an admitted fact that the petitioner is only a share holder in the Company. In the document No.6 at page No.25 the name of the petitioner is not found in the list of directors as on 18.11.2010. As per the information available at page No.29 Mr. Nishit Mohanty and Pramod Sadashiv Shetti are the directors of the Company. According to the information available at page 30, of the said document, the petitioner is only a shareholder. In response to the legal notice issued by the complainant the General Manager of the Company has given reply and clarification about the several violations said to have been committed by the Company. At that point of time the complainant has not made any efforts to seek clarification as to who is the in charge of the day to day affairs of the Company or its management. 8. Section 25 of the Contract Labour (Regulation and Abolition) Act, 1970 reads as under: 25. Offences by Companies. At that point of time the complainant has not made any efforts to seek clarification as to who is the in charge of the day to day affairs of the Company or its management. 8. Section 25 of the Contract Labour (Regulation and Abolition) Act, 1970 reads as under: 25. Offences by Companies. (1) If the person committing an offence under this Act is a company, the company as well as every person in charge of, and responsible to, the company for the conduct of its business at the time of the commission of the offence 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 any punishment if he proves that the offence 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 that the commission of the offence is attributable to any neglect on the part of any director, manager, managing agent or any other officer of the company, such director, manager, managing agent or such 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 any 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. 9. In view of the aforesaid Section if the person committing an offence under this Act is a Company, the Company as well as every person in charge of and responsible to the Company for the conduct of its business at the time of commission of the offence shall be deemed to be guilty of offence. But in the instant case the Company is not arrayed as accused and no documents are forthcoming to show that the petitioner being in charge of the Company was responsible for the conduct of its business. On the contrary, the documents produced by the counsel for the petitioner confirms that the petitioner is only a share holder. But in the instant case the Company is not arrayed as accused and no documents are forthcoming to show that the petitioner being in charge of the Company was responsible for the conduct of its business. On the contrary, the documents produced by the counsel for the petitioner confirms that the petitioner is only a share holder. Thus, at no stretch of imagination the responsibility can be fixed on the petitioner for commission of the offences by the Company. 10. In a decision reported in (2005) 8 SCC 89 in the case of S.M.S. PHARMACEUTICALS LTD., VS. NEETA BHALLA AND ANOTHER, the Hon’ble Supreme Court has observed as under: “10. While analyzing Section 141 of the Act, it will be seen that it operates in cases where an offence under Section 138 is committed by a Company. The key words which occur in the section are “every person”. These are general words and take every person connected with a Company within their sweep. Therefore, these words have been rightly qualified by use of the words : “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, etc”. What is required is that the persons who are sought to be made criminally liable under Section 141 should be, at the time the offence was committed, in charge of and responsible to the Company for the conduct of the business of the Company. Every person connected with the Company shall not fall within the ambit of the provision. It is only those persons who were in charge of and responsible for the conduct of business of the Company at time of commission of an offence, who will be liable for criminal action. It follows from this that if a director of a Company who was not in charge of and was not responsible for the conduct of the business of the Company at the relevant time, will not be liable under the provision. The liability arises from being in charge of and responsible for the conduct of business of the Company at the relevant time when the offence was committed and not on the basis of merely holding a designation or office in a Company. The liability arises from being in charge of and responsible for the conduct of business of the Company at the relevant time when the offence was committed and not on the basis of merely holding a designation or office in a Company. Conversely, a person not holding a designation or office in a Company may be liable if he satisfies the main requirement of being in charge of and responsible for the conduct of business of a Company at the relevant time. Liability depends on the role one plays in the affairs of a Company and not on designation or status. If being a director or manager or secretary was enough to cast criminal liability, the section would have said so. Instead of “every person” the section would have said “every director, manager or secretary in a Company is liable”…, etc. The legislature is aware that it is a case of criminal liability which means serious consequences so far as the person sought to be made liable is concerned. Therefore, only persons who can be said to be connected with the commission of a crime at the relevant time have been subjected to action” 11. In the above decision, the Supreme Court has further observed as under : “11. A reference to sub-section(2) of Section 141 fortifies the above reasoning because sub-section(2) envisages direct involvement of any director, manager, secretary or other officer of a Company in the commission of an offence. This section operates when in a trial it is proved that the offence has been committed with the consent or connivance or is attributable to neglect on the part of any of the holders of these offices in a Company. In such a case, such persons are to be held liable. Provision has been made for directors, managers, secretaries and other officers of a Company to cover them in cases of their proved involvement.” The aforesaid decision is relied on in the decision cited by the learned counsel for the petitioner. 12. Section 25 is similar to that of Section 141 of the N.I. Act. As such, the principle laid down in the aforesaid decisions are applicable to the facts of this case. 13. 12. Section 25 is similar to that of Section 141 of the N.I. Act. As such, the principle laid down in the aforesaid decisions are applicable to the facts of this case. 13. The law laid down by the Apex Court is that if the offence is committed by the Company the director or a person in charge of the affairs of the Company becomes liable for the offence committed by the Company for violations under the Contract labour (Regulation and Abolition) Act, 1970. There must be specific averments against those persons who are responsible for the affairs of the Company as to how and in what manner they were responsible for conduct of the business of that Company. Section 25 raises a legal fiction, by reason of the said provision, a person although was not responsible for commission of such an offence would be vicariously liable if there is prima facie material to show that he was actively involved in the management of the Company, thereby he has committed the offences. The documents produced in the present case go to show that the petitioner was only a shareholder and there are no specific averments in the complaint regarding the active role played by the petitioner on behalf of the Company or in the affairs of the Company so as to make him vicariously liable for the offences committed by the Company. 14. For the foregoing reasons, I am of the view that there are valid grounds for quashing the proceedings in C.C. No.1149/2011 as far as the petitioner is concerned. Hence I proceed to pass the following: ORDER : The petition is allowed. The proceedings in C.C. No.1149/2011 is quashed. The complainant – respondent is at liberty to initiate the criminal proceedings against the Company in accordance with law.