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Cites 15 docs - [View All]
Section 10 in The Essential Commodities Act, 1955
the Delhi Special Police Establishment Act, 1946
The Minimum Wages Act, 1948
Madan Mohan Upadhyay vs The State Of Bihar on 6 February, 2012
Section 482 in The Code Of Criminal Procedure, 1973
Citedby 2 docs
R.N. Bajaj vs K. Govindan, Income-Tax Officer on 21 January, 1992
Sureshkumar Bhuwalka And Ors. vs State And Anr. on 1 February, 2006

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Patna High Court
Hari Charan Singh Dugal And Ors. vs State Of Bihar on 26 March, 1987
Equivalent citations: 1989 66 CompCas 449 Patna, 1989 (59) FLR 718, (1990) ILLJ 310 Pat
Author: L Shahdeo
Bench: L Shahdeo

JUDGMENT L.P.N. Shahdeo, J.

1. This application under Section 482 of the Criminal Procedure Code has been filed for quashing the entire criminal proceeding in M. W. Case No. 73 of 1982 and the order taking cognizance dated June 24, 1982, passed by the learned Chief Judicial Magistrate, Dhanbad.

2. It appears that the Labour Inspector had inspected the company of the petitioner known as M/s U.S. Dugal and Company and found that certain registers were not maintained in accordance with the requirements of the Minimum Wages Act and the Rules framed thereunder. He had given a list of registers, viz., casual labour register, destruction and loss register, excess payment register, muster roll register, etc. Thereafter, he sent reminders for production of those registers to the project manager, several times and every time he received letters for extension of time and ultimately, when those registers were not produced, he filed this case for alleged violation of Sections 18 and 19(4) of the Act and thereafter a complaint was filed and cognizance of the offence was taken and the petitioners were summoned.

3. Mr. M.K. Laik, learned counsel for the petitioners, submitted that the petitioners are shown as the directors of M/s U.S. Dugal and Company and there is no specific allegation that they were responsible for the conduct of the business and as such the prosecution of the petitioners is a clear misuse of the powers of the court. It was further pointed out that, in substance, the Labour Inspector had entered into several correspondence with the project manager which show that the project manager was responsible for the affairs of the company and as such he should have been prosecuted if any violation was made and not the directors who were not even present nor were responsible for the day-to-day affairs of the company.

4. Mr. Jhunjhunwala, learned counsel for the opposite party, relied on the Full Bench ruling Madan Mohan Upadhyay v. State of Bihar [1986] PLJR 537, and submitted that if the offence is committed by a firm or a company, all persons, whether director, manager, or partner, etc., are liable for the offence committed and it is not necessary that the director, manager or partner should be specifically named that any offence was committed with their connivance or consent and in this view of this matter, the petitioners who are the directors of the company are also liable for prosecution. In the complaint petition, the petitioners have been described as the managing director and directors and the company has also been made an accused along with the managing director and directors. Admittedly, the complainant had entered into correspondence with the supervisor and the project manager of the company for production of the relevant registers but that was not done nor were his directions complied with. It also appears that he also informed the directors about violation of the relevant provisions but in spite of that, nothing was done by any of the petitioners. The allegation, therefore, was that all the petitioners, in one way or the other, were responsible and the violation so committed was brought to their notice, but still no action was taken. In the Full Bench ruling it has been specifically held that if the offence is committed by the company or the firm, its director, manager or partner become vicariously liable for the offence and continue to be so liable, unless and until they prove to the contrary, and naming of the director, manager or partner in the complaint, specifically, is not necessary.

5. In another Full Bench ruling (Badri Prasad Gupta v. State of Bihar [1986] PLJR 146; AIR 1986 Pat 186), which was a case under the Shops and Establishments Act, Section 35 of that Act was found to be pan materia to Section 10 of the Essential Commodities Act. In this case also, it was held that it is not required to plead in the complaint that the director, partner, manager or the secretary either exercise ultimate control over the affairs of the company or the partnership firm or was in immediate charge of the general management or control thereof for the offences of contravention of that Act. In another ruling, Mahmud Ali v. State of Bihar [1986] PLJR 123; AIR 1986 Pat 133 [FB], which was a case under the Water (Prevention and Control of Pollution) Act, 1974, it was held that Section 77 of that Act was similar to Section 10 of the Essential Commodities Act and on that basis, it was held by a fiction of law that every person who is in charge of or responsible to the company for the conduct of its business, in the eye of law, be deemed as much guilty as the primal offending company. It was further held that, no doubt, this rule is stringent and rigorous except to the extent that a person on whom the vicarious liability has been foisted may avoid his prosecution, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of the offence.

6. On the other hand, learned counsel for the petitioners submitted that the petitioners being directors are not liable for prosecution on the basis of the ruling in Municipal Corporation of Delhi v. Ram Kishan Rohtagi, AIR 1983 SC 67 and State of Madras v. C.V. Parekh, AIR 1971 SC 447. These rulings were also considered in the Full Bench cases (1986--P.L.J.R.--pages 246 and 537)(supra), and, thereafter it was held as indicated above.

7. In this connection, it should be noted that Section 22(c) of the Minimum Wages Act, 1948 is in pari materia to Section 10 of the Essential Commodities Act, and, therefore, all the aforesaid Full Bench rulings of this court are applicable to the instant case. The petitioners who are directors can be prosecuted along with the company under the Minimum Wages Act and the Rules if a violation is committed. It is not necessary to pinpoint the specific part played by each of them or their individual responsibility in the complaint.

8. It was also contended that cognizance has been taken under Section 22A of the Act and so Section 22C has no application. Cognizance is taken of the offence and the fact constituting the offence is to be considered and not the section at the time of the trial or framing of the charges. Learned counsel may press this point at the time of trial at the proper stage. It was farther submitted by learned counsel for the petitioners that since four years have elapsed after the passing of the order of cognizance and the directors who live far away from the place of occurrence cannot be informed immediately and they may not be knowing about this case, in these circumstances, the court may be directed to issue a fresh summons to them and when they appear they be granted bail. This appears to be a reasonable submission. The court below shall consider this matter and pass necessary orders in accordance with law.

9. In the result, for the reasons stated above,  I do not find  any merit in this application.    It is, accordingly, dismissed.