Skip to content


Roshan Lal Singhania and ors. Vs. Municipal Corporation of Delhi and anr. - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtDelhi High Court
Decided On
Judge
Reported in1978CriLJ1027
AppellantRoshan Lal Singhania and ors.
RespondentMunicipal Corporation of Delhi and anr.
Cases ReferredIn P. L. Lamba v. State
Excerpt:
.....instituted against him under section 20' (emphasis added). these words seem to imply that such person, manufacturer, distributor or dealer' the scheme of the act, as would appear from section 20 in particular, is that no prosecution for an offence under this act (not being an offence under section 14 or section 14-a -which does not apply in the present case) shall be instituted except by or with the written consent of the central government or the state government or a person authorised in this behalf by general or special order by the central government or the state government, section 20-a, which enables summons to issue to the 'manufacturer, distributor or dealer',is by way of an exception to section 20; in other words it enables summons to be issued to any such person (obviously..........instituted against him under section 20' (emphasis added). these words seem to imply that such person, 'manufacturer, distributor or dealer' had not been imp leaded as an accused by the complainant. the scheme of the act, as would appear from section 20 in particular, is that no prosecution for an offence under this act (not being an offence under section 14 or section 14-a - which does not apply in the present case) shall be instituted except by or with the written consent of the central government or the state government or a person authorised in this behalf by general or special order by the central government or the state government, section 20-a, which enables summons to issue to the 'manufacturer, distributor or dealer', is by way of an exception to section 20; in other words.....
Judgment:

S. Rangarajan, J.

1. The four petitioners have invoked the jurisdiction of this Court under Section 482, Cr. P. C, for quashing the summons (also warrants) issued to them by the learned Metropolitan Magistrate (Shri J. D. Kapoor) on 13-10-1976 in the following circumstances,

2. It may be noticed that the Supreme Court has recently decided that an order issuing summons to the petitioners without jurisdiction to do so is not an 'interlocutory order', against which a revision would not lie (vide Amar Nath v. State of Haryana Cr. A. 124 of 1977 decided on 29-7-1977 : reported in : 1977CriLJ1891 and Madhu Limaye v. The State of Maharashtra Cr. Appeal 81 of 1977, decided on 31-10-1977 : reported in : 1978CriLJ165 .

3. The facts leading to the present petition before this Court, briefly stated, are as follows : On 21-9-1973 Food Inspectors Sarvashri R.D. Sharma. O. P. Gupta and others took two samples of mustard oil from the factory premises of Messrs Radha Kishan Gobind Ram Private Ltd. The samples are said to have been given on behalf of the company by Ram Niwas. It is further stated that both the samples have been found to be adulterated; the variations from the prescribed standard are said to be minor but this is not a question which arises for determination at this stage.

4. A prosecution was initially laid by the Municipal Corporation of Delhi against the Company, namely, Radha Kishan, Gobindram Private Ltd., (2) Ram Tirath, said to be in direct charge of the said company, (3) Manager Ram Saran Das, (4) Factory Manager Niranjan Dass and (5) the Vendor Ram Niwas. The prosecution had been laid on the basis of the two resolutions of the company passed on 19-6-1973, two letters dated 10-12-1973 and 16-2-1974 and yet another letter dated 28-3-1974 which had been sent by the Director in charge (Tirath Ram) to the Food Inspector Shri O. P. Gupta. Those documents have been collectively marked as Annexure A to this petition (vide pages 17 to 22 of the record),

5. The prosecution examined four witnesses before the charge, namely, the two Food Inspectors, a Licensing Clerk of the Municipal Corporation of Delhi and a Clerk from the office of the Registrar of Companies,

6. During the arguments which were advanced prior to the framing of charge the learned Counsel for the Manager and the Factory Manager had made an application to the trial court praying that certain witnesses be examined at that stage as court witnesses, so that it could be shown that besides Tirath Ram there are four other Directors of the company (the present petitioners), who have also been in charge of and responsible to the company for the conduct of its business and, thereforee, liable to be imp leaded under Section 20A of the Prevention of Food Adulteration Act, 1954 (called the Act). It is stated that the Manager and the Factory Manager are not in the service of the company.

7. On 4-2-1976, the learned trial Magistrate rejected the above said prayer and refused to issue summons to them. It was observed that such an application was 'not maintainable on behalf of the accused persons and that the complainant had 'chosen to prosecute the Director Ram Tirath who wrote a letter (Ex. P, B.) to the Food Inspector taking his responsibility regarding the affairs of the company.'

8. After framing of charge the prosecution witnesses, examined earlier, were recalled and further cross examined. The cross examination revealed that two of the petitioners (Roshan Lal Singhania and Jagdish Chander Singhania) had retired on 12-9-1973 and the petitioner Girdhari Lal Singhania had retired on 18-9-1973, the samples having been taken later, on 21-9-1973.

9. Subsequently the learned Counsel for the Manager and the Factory Manager (two of the accused in the case) again repeated their earlier prayer to implead the present petitioners under Section 20-A of the Act. What seems somewhat surprising is that even ignoring this prior order dated 4-2-1976 the learned Magistrate passed the order, which is now impugned, on 13-10-1976 issuing summons to the above four petitioners including three of them who had resigned even earlier than the taking of samples in this case. The learned Magistrate observed in the impugned order as follows:

According to the statement of Shyam Sunder, the clerk, no verification about the correctness or incorrectness of their retirement is made by his department, He has also stated that intimation of retirement of Girdhari Lal Singhania was received in their office on 27-2-1974 and about 2 remaining on 11-10-73, The sample was taken on 21-9-73. It has also appeared in the evidence of Shyam Sunder that one Raj Kumar Singhal was appointed as Director on 29-11-74 as per annual return filed on 30-10-74. The incident of retirement of the above 3 directors and induction of new director Raj Kumar Singhal seems to be prima facie manipulation because the sample was taken on 21-9-73 whereas the intimation about their retirement was sent on 27-2-74 and 11-10-73 to the office of the Registrar of Companies and there is no reason why they take so much time in intimating about the retirement of the Directors when they knew that the sample had been taken on 21-9-73. It has also been stated by this witness that any information regarding this has to be sent to the Registrar of Companies within 30 days ...as per statement of P. W. 3 Shyam Sunder clerk there is no mention about any Director being the director in charge in their record as every Director is supposed to be in charge and responsible for conduct of the affairs of the company. Now all the remaining 4 Directors be summoned as accused persons through bailable warrants in the sum of Rs. 2000/- under Section 20-A PFA Act.

10. The learned Magistrate seems to have indulged only in what may be termed speculation. There seems to be no need, however, to be detained by this aspect since the impugned order appears to be one beyond his jurisdiction.

11. Sections 17, 20 and 20-A of the Act, as they now stand, may be read even if Section 17 of the Act as it stood prior to the amendment by Act 34 of 1976 (on which no opinion is expressed) that would make no difference in the view taken concerning the inter-pretation of Sections 20 and 20-A:

17. Offence by companies.- (I) Where an offence under this Act has been committed by a company-

(a) (i) the person, if any, who has been nominated under Sub-section (2) to be in charge of, and responsible to the company for the conduct of the business of the company (hereafter in this section referred to as the person responsible), or

(ii) Where no person has been so nominated 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; and

(b) 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 any punishment provided in this Act if he proves that the offence was committed without his knowledge and that he exercised all due diligence to prevent the commission of such offence.

(2) Any company may, by order in writing, authorise any of its directors or managers (such manager being employed mainly in a managerial or supervisory capacity) to exercise all such powers and take all such steps as may be necessary or expedient to prevent the commission by the company of any offence under this Act and may give notice to the Local (Health) Authority in such form and in such manner as may be prescribed, that it has nominated such director or manager as the person responsible along with the written consent of such director or manager for being so nominated:

Explanation : where a company has different establishments or branches or different units in any establishment or branch different persons may be nominated under this sub-section in relation to different establishments or branches or units and the person nominated in relation to any establishment branch or unit shall be deemed to be the person responsible in respect of such establishment, branch or unit.

(3) the person nominated under Sub-section (2) shall, until-

(i) further notice cancelling such nomination is received from the company by the Local (Health) Authority; or

(ii) he ceases to be a director or, as the case may be, manager of the company; or

(iii) he makes a request in writing to the Local (Health) Authority under intimation to the Company, to cancel the nomination (which request shall be complied with by the Local (Health) Authority), whichever is the earliest, continue to be the person responsible : Provided that where such person ceases to be a director or, as the case may be, manager of the company, he shall intimate the fact of such cesser to the Local (Health) Authority : Provided further that where such person makes a request under Clause (iii) the Local (Health) Authority shall not cancel such nomination with effect from a date earlier than the date on which the request is made.

(4) Notwithstanding anything contained in the foregoing sub-sections, 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 is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company (not being a person nominated under Sub-section (2)), such director, manager, secretary, or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

XX XX XX Section 20. Cognizance and trial of offences-(1) No prosecution for an offence under this Act, (not being an offence under Section 14 or Section 14A) shall be instituted except by or with the written consent of, the Central Government or the State Government or a person authorised in this behalf, by general or special order by the Central Government or the State Government.

Provided that a prosecution for an offence under this Act may be instituted by a purchaser referred to in Section 12, if he produces in court a copy of the report of the public analyst along with the complaint,

(2) No court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try an offence under this Act.

XX XX XX Section 20A. Power of court to implead manufacturer, etc.- Where at any time during the trial of any offence under this Act alleged to have been committed by any person, not being the manufacturer, distributor or dealer of any article of food, the court is satisfied, on the evidence adduced before it, that such manufacturer, distributor or dealer is also concerned with that offence, then, the court may notwithstanding anything contained in Sub-section (3) of Section 319 of the Code of Criminal Procedure, 1973 (2 of 1974) or in Section 20 proceed against him as though a prosecution had been instituted against him under Section 20.

12. Section 20A seems to be the only provision in this Act which enables the court, if satisfied on the evidence before it that such 'manufacturer, distributor or dealer' is also concerned with the offence to proceed against such person also as though a prosecution has been instituted against him under Section 20' (emphasis added). These words seem to imply that such person, 'manufacturer, distributor or dealer' had not been imp leaded as an accused by the complainant. The scheme of the Act, as would appear from Section 20 in particular, is that no prosecution for an offence under this Act (not being an offence under Section 14 or Section 14-A - which does not apply in the present case) shall be instituted except by or with the written consent of the Central Government or the State Government or a person authorised in this behalf by general or special order by the Central Government or the State Government, Section 20-A, which enables summons to issue to the 'manufacturer, distributor or dealer', is by way of an exception to Section 20; in other words it enables summons to be issued to any such person (obviously one not imp leaded already) if the court is satisfied that that person ('manufacturer, distributor or dealer') was also concerned with that offence. A manufacturer or distributor can be joined as a co-accused along with the person from whom the sample is taken from the very beginning. A joint trial of such person is permissible (vide also the decision of a Full Bench of this Court in Municipal Corporation of Delhi v. Lakshmi Narain 1973 Cr LJ 690. In that event, it is worth recalling that the written consent of the competent authority was necessary for launching of prosecution against them. The requirement of the written consent of the competent authority being a pre-requisite for launching a prosecution under this Act is not a mere empty formality if is a safeguard meant for the protection of persons who would be so imp leaded. Section 20-A, avowedly an exception to Section 20, lays down that the '. as well as its Director In-charge had been imp leaded after get-ting the written consent of the competent authority. It seems to me that in these circumstances the summoning of further persons said to be connected with the manufacturing company (more Directors etc.) without the safeguard of the written consent of the competent authority as provided in Section 20 would not be competent. Section 20-A is the solitary provision which makes it possible for the court to issue a summons to a person who is a manufacturer, distributor or dealer of article of food of which a sample has been taken even without insisting on the requirement of a written consent of the competent authority as provided in Section 20 because this is an effective way of combating the evil of adulteration of goods, This has to be obviously confined only to cases where the manufacturer has not already been made a party to the prosecution. It cannot certainly be extended to a case where the competent authority had given its written consent to prosecute the manufacturing company and a certain Managing Director alone as being its Director in charge, In this view the learned Magistrate had rightly rejected the application to issue summons to the present petitioners on the earlier occasion, namely, on 4-2-1976,

13. It is true no doubt that under Section 17 where an offence has been committed by a company every person in charge of and responsible to the company for the conduct of the business of the company would be liable subject, however, to every such person proving that the offence was committed without his knowledge and despite his exercising all due diligence to prevent commission of such an offence. Sub-section (2) of Section 17 permits a company by order in writing to authorise any of its directors or managers to exercise all such powers and take all such steps as may be necessary or expedient to prevent the commission by the company of any offence under this Act. This section is a substantive legal provision; it is not a procedural requirement; the procedural requirement has been laid down by Section 20 subject only to the exception (u/s, 20A) that the 'manufacturer, distributor or dealer' who has obviously not been made a party to the prosecution already could be made a party even after the launching of prosecution under this Act notwithstanding anything contained in Section 20 concerning the requirement of a consent in writing from a competent authority being obtained as a pre-condition of launching the prosecution. This aspect of the matter seems to have been completely missed by the learned Magistrate when he passed the impugned order, The true legal position, thereforee, appears to be that the issue of summons to the petitioners who were not even made parties to the prosecution under Section 20 was not warranted.

14. The learned Magistrate himself did not choose to rely upon any other power which he could exercise under the Code of Criminal Procedure in this respect, The consideration here is, and has to be limited, to the question of construction of Section 20-A read along with Section 20. The pre-conditions for the exercise of powers under Section 20-A would appear to be as follows:

(1) The trial for an offence under the Act should be pending against a person other than the manufacturer, distributor or dealer of any article of food (the present is not such a case because there was a trial of an offence under the said Act pending against the 'manufacturer' as well):

(2) There must be evidence before the court that such manufacturer, distributor or dealer was concerned with the offence with which the person concerned was charged (so far as the petitioners are concerned there was no positive evidence and even the complainant did not say so) and

(3) the court which convicts (sic) him should be satisfied by evidence that such manufacturer, distributor or dealer is concerned with the offence. It is only if all the conditions are satisfied that the court can proceed against such manufacturer, distributor or dealer, In the present case it is sufficient to point out that condition No. (1) is not present.

15. My attention has been invited to the decision of a learned single Judge of this Court who had observed In P. L. Lamba v. State (1975) 1 FAC 337 that the opening part of Section 20A 'is significant'? 'a manufacturer, distributor or dealer would incur the liability within the scope of the foregoing provision only in a case where the trial is going on in respect of a per-son who by himself does not fall in any trial (sic) with respect to such a person than the provision will not come in for application,'

16. It remains for me only to clarify that I am not expressing any opinion about the liability of any of the petitioners in law if the same should be proved to fall within Section 17 of the Act, I am only concerned to point out that Section 20-A of the Act could not be invoked for summoning the petitioners for the reasons stated above. The petition is accordingly accepted and the impugned order issuing summons to the petitioners is quashed,

17. The papers which have been sent for from the trial court will be sent back expeditiously for proceeding with the case of the prosecution against the accused in the said case other than the present petitioners.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //