Allowed

The Manager/ Secretary Kisan Krishi Seva Sangh, v. the State of Karnataka

Karnataka HC7 Sept 2022CRL.P/102511/2022

Case brief

AI extract

What is this about?

High Court allowed Criminal Petition under Section 482 Cr.P.C. to quash proceedings against petitioner for offences under Essential Commodities Act. Held that prosecution of individual under Section 10 requires arraigning the company as accused, citing Aneeta Hada.

What did the court decide?

The proceedings in C.C. No.1222/2021 were quashed insofar as the petitioner was concerned.

The Manager/ Secretary Kisan Krishi Seva Sangh, Vs the… — Quashing and FIR | Karnataka HC (2022)

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CRL.P No. 102511 of 2022

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IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 7^TH DAY OF SEPTEMBER, 2022

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BEFORE

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THE HON'BLE MS. JUSTICE J.M.KHAZI CRIMINAL PETITION NO. 102511 OF 2022 (482-)

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BETWEEN:

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THE MANAGER/ SECRETARY, KISAN KRISHI SEVA SANGH, SHEDBAL ,TAL: KAGWAD, DIST. BELAGAVI, REPRESENTED BY ITS SECRETARY PRAKASH DHAREPPA CHOUGULE, AGE. 66 YEARS, R/O. SHEDBAL, TAL. KAGWAD, DIST. BELAGAVI-591315.

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…PETITIONER

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(BY SRI. VITTHAL S. TELI., ADVOCATE)

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AND:

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ANNAPURNA CHINNAPPA DANDAGAL

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Digitally signed byANNAPURNA CHINNAPPA DANDAGAL Location: HIGH COURT OF KARNATAKA, DHARWAD BENCH, DHARWAD.

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THE STATE OF KARNATAKA, REPRESENTED BY THE FERTILIZER INSPECTOR CUM ASSISTANT DIRECTOR OF AGRICULTURE, R/O: THE ASSISTANT DIRECTOR OF AGRICULTURE, KAGWAD, DIST. BELAGAVI BY THE STATE PUBLIC PROSECUTOR, HIGH COURT OF KARNATAKA , DHARWAD BENCH, DHARWAD.

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…RESPONDENT

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(BY SMT. GIRIJA S. HIREMATH., HCGP)

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CRL.P No. 102511 of 2022

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THIS CRIMINAL PETITION IS FILED U/SEC.482 OF CR.P.C. SEEKING TO QUASH THE ORDER DATED 20.09.2021 IN C.C. NO. 1222/2021 PC NO.31/2021) FOR THE OFFENCES UNDER SECTION 3 AND 7 OF THE ESSENTIAL COMMODITIES ACT AND CLAUSE 19 FERTILIZERS (CONTROL) ORDER 1985 PENDING ON THE FILE OF CIVIL JUDGE AND JMFC-KAGWAD, IN SO FOR PETITIONER/ ACCUSED NO.1 IS CONCERNED.

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THIS CRIMINAL PETITION COMING ON FOR ADMISSION, THIS DAY, COURT MADE THE FOLLOWING:

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ORDER

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Petitioner who is arraigned s accused No.1 has filed this petition under section 482 of Cr.P.C, to quash the criminal prosecution in C.C. No.1222/2021 for the offences punishable under Sections 3 and 7 of the Essential Commodities Act,1955 and clause 19 of the Fertilizers (Control) Order 1985, on the file of Civil Judge and JMFC, Kagwad.

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It is the case of the petitioner that on 13.11.2013, respondent collected three samples of 2020+0 fertilizers. After furnishing one sample to the petitioner, he sent one sample to the lab and on 12.12.2013 allegedly received report to the effect that the

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CRL.P No. 102511 of 2022

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sample was of sub-standard. However, respondent filed a private complaint before the JMFC, Athani, on 01.07.2021 i.e., after lapse of more then eight years. Now the said complainant is transferred to JMFC, Kagwad. The learned JMFC, Athani, without any judicial application of mind took cognizance on 20.09.2021 and the case is registered in C.C. NO.1222/2021. Challenging the same, the present petition is filed. The learned counsel representing petitioner submits that while taking cognizance the learned magistrate has not appreciated the fact that there is an inordinate delay of more then eight years in filing the complaint. As per Clause 24 of the Fertilizers (Control) Order 1985, the Company which manufacture the product is also liable. However, as per Section 10 of the Essential Commodities Act without arraigning the company as accused, the complaint against the petitioner is not maintainable and prays to quash the proceedings.

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CRL.P No. 102511 of 2022

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On the other hand learned High Court

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Government Pleader supported the action taken by the complainant and the trial Court.

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Heard the arguments and perused the record.

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As per the complaint averments the charges leveled against the petitioners are punishable under Sections 3 and 7 of the Essential Commodities Act r/w. Clause 19 of the Fertilizers (Control) Order 1985.

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Section 10 of the Essential Commodities Act,

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1955, deals with the offence by Companies and it reads as follows:

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10. Offences by companies.— (1) If the person contravening an order made under section 3 is a company, every person who, at the time the contravention 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 contravention and shall be liable to be proceeded against and punished accordingly:

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CRL.P No. 102511 of 2022

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Provided that nothing contained in this sub-section shall render any such person liable to any punishment if he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention.

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(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 is attributable to any neglect on the part of any director, manager, secretary or other officer of the company, 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.

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Perusal of Section 10 of the Essential Commodities Act, 1955 makes it evident that wherever contravention is by a Company, then every person who, at the time the contravention 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 contravention and shall be liable to be proceeded against and punished accordingly.

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CRL.P No. 102511 of 2022

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Therefore, petitioner is being made liable on account of he being an employee of Company in question and therefore, until and unless the company is arraigned as accused, the petitioner cannot be held responsible.

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In fact, the Hon’ble Apex Court in Aneeta

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Hada Vs. Godfather Travels and Tours Private

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Limited¹ while considering the offence committed by the company has held as follows:

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“53. It is to be borne in mind that Section 141 of the Act is concerned with the offences by the company. It makes the other persons vicariously liable for commission of an offence on the part of the company. As has been stated by us earlier, the vicarious liability gets attracted when the condition precedent laid down in Section 141 of the Act stands satisfied. There can be no dispute that as the liability is penal in nature, a strict construction of the provision would be necessitous and, in a way, the warrant.

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56. We have referred to the aforesaid

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passages only to highlight that there has to be

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1 (2012) 5 SCC 661

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CRL.P No. 102511 of 2022

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strict observance of the provisions regard being had to the legislative intendment because it deals with penal provisions and a penalty is not to be imposed affecting the rights of persons, whether juristic entities or individuals, unless they are arrayed as accused. It is to be kept in mind that the power of punishment is vested in the legislature and that is absolute in Section 141 of the Act which clearly speaks of commission of offence by the company. The learned counsel for the respondents have vehemently urged that the use of the term “as well as” in the section is of immense significance and, in its tentacle, it brings in the company as well as the Director and/or other officers who are responsible for the acts of the company and, therefore, a prosecution against the Directors or other officers is tenable even if the company is not arraigned as an accused. The words “as well as” have to be understood in the context.

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59. In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the drag-net on the touchstone of vicarious liability as the same has been stipulated in the provision itself. We say so on the basis of the ratio laid down in C.V. Parekh [(1970)

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CRL.P No. 102511 of 2022

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3 SCC 491 : 1971 SCC (Cri) 97] which is a threeJudge Bench decision. Thus, the view expressed in Sheoratan Agarwal [(1984) 4 SCC 352 : 1984 SCC (Cri) 620] does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada [(2000) 1 SCC 1 : 2001 SCC (Cri) 174] is overruled with the qualifier as stated in para 51. The decision in Modi Distillery [(1987) 3 SCC 684 : 1987 SCC (Cri) 632] has to be treated to be restricted to its own facts as has been explained by us hereinabove.”

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In the light of the above judgment and having regard to the fact that the company is not arraigned as accused, I am of the considered opinion that the complaint is not tenable as against the petitioner and therefore, the proceedings are liable to be quashed insofar as the petitioner is concerned. Accordingly, I proceed to pass the following:

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ORDER

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The Criminal petition is allowed.

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CRL.P No. 102511 of 2022

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The impugned proceedings in

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C.C.No.1222/2021 (PC No.31/2021) pending on

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