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2018 DIGILAW 972 (JHR)

Rajesh Tiwari v. Union of India

2018-05-01

RONGON MUKHOPADHYAY

body2018
ORDER : Heard the parties. 2. In this application, the petitioner has prayed for quashing the entire criminal proceeding in connection with Complaint Case No. C-III 136/2006 including the order dated 4.11.2006, passed by the learned Chief Judicial Magistrate, Ranchi, by which cognizance has been taken for the offence under section 24 of the Contract Labour (Regulation & Abolition)Act, 1970. 3. It has been submitted by the learned counsel for the petitioner that the petitioner has been arrayed as an accused on account of the fact that he happens to be the Director of M/s Reliance Next Link (P) Ltd. It has further been submitted that in the complaint petition, it has vaguely been stated that the petitioner being the Director of M/s Reliance Next Link ( P) Ltd is responsible for day to day affairs of the company but the same is not sufficient to prosecute the petitioner for committing an offence under section 24 of the Contract Labour (Regulation & Abolition) Act, 1970 as it was necessary for the complainant to spell out as to in what manner the petitioner was responsible for the day to day affairs of the complainant. It has also been submitted that Section 25 of the Contract Labour (Regulation & Abolition) Act, 1970 is pari materia with section 141 of the Negotiable Instruments Act and with respect to absence of any specific role played by the petitioner in day to day affairs of the company, reference has been made to the case of National Small Industries Corporation Limited Vs. Harmeet Singh Paintal & Another, reported in (2010) 3 SCC 330 . 4. Learned counsel for the O.P. No. 2 has opposed the prayer made by the learned counsel for the petitioner. 5. It appears from the complaint petition instituted by the O.P. No. 2, who is an Inspector appointed under section 28(1) of the Contract Labour (Regulation & Abolition) Act, 1970 is to the effect that while inspecting the establishment of M/s Reliance Next Link (P) Ltd, he had found several irregularities, which has been noted in the complaint petition itself and therefore it was opined that the accused persons have made themselves liable to be prosecuted under section 24 of the Contract Labour (Regulation & Abolition)Act, 1970. Perusal of the complaint petition reveals that petitioner has been made an accused by name being the Director of M/s Reliance Next Link (P) Ltd. In the complaint petition, it has been mentioned that the petitioner is one of the persons responsible for the day to day affairs of the establishment at place of work. Although various irregularities have been noted in the complaint petition but nothing has been specified as to in what manner petitioner was responsible for the day to day affairs of the company. It is also to be noted herein that a show cause notice was issued to the company regarding defects, to which a reply was given that irregularities have been removed. 6. In the case of National Small Industries Corporation Limited (Supra) while considering the provision of Section 141 of the Negotiable Instruments Act as to whether the Director was responsible for the day to day affairs of the Company, it was held as follows :- “13. Section 141 is a penal provision creating vicarious liability, and which, as per settled law, must be strictly construed. It is therefore, not sufficient to make a bald cursory statement in a complaint that the Director (arrayed as an accused) is in charge of and responsible to the company for the conduct of the business of the company without anything more as to the role of the Director. But the complaint should spell out as to how and in what manner Respondent 1 was in charge of or was responsible to the accused Company for the conduct of its business. This is in consonance with strict interpretation of penal statutes, especially, where such statutes create vicarious liability”. 7. Aforesaid pronouncement therefore reveals that the concept of vicarious liability has to be strictly construed and it can therefore be concluded that merely making a bald reference about the petitioner being involved in day to day affairs of the company would not suffice. 8. 7. Aforesaid pronouncement therefore reveals that the concept of vicarious liability has to be strictly construed and it can therefore be concluded that merely making a bald reference about the petitioner being involved in day to day affairs of the company would not suffice. 8. Section 141 of the Negotiable Instruments Act is pari materia to section 25 of the Contract Labour (Regulation & Abolition) Act, 1970 and therefore the strict interpretation of Section 25 of the said Act was necessary prior to institution of the complaint petition but nothing has been stated in the complaint petition with respect to how and in what manner the petitioner being the Director of M/s Reliance Next Link (P) Ltd was responsible for the day to day affairs of the company. 9. In such circumstances, therefore, continuation of criminal proceedings as against the petitioner would be an abuse of the process of court and would lead to miscarriage of justice. Accordingly, this application is allowed and entire criminal proceedings in connection with Complaint Case No. C-III 136/2006 including the order dated 4.11.2006, passed by the learned Chief Judicial Magistrate, Ranchi, by which cognizance has been taken for the offence under section 24 of the Contract Labour (Regulation & Abolition) Act, 1970 is hereby quashed and set aside.