Karnataka High Court
Ammangouda M. Biradar vs Karnataka State Government on 22 February, 2022
Bench: M.Nagaprasannapresided Bymnpj
IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 22ND DAY OF FEBRUARY 2022
BEFORE
THE HON'BLE MR. JUSTICE M.NAGAPRASANNA
CRIMINAL PETITION NO.100211/2021
BETWEEN:
AMMANGOUDA M. BIRADAR
AGE. 35 YEARS, OCC. BUSINESS,
TECHNICAL OFFICER,
EXCEED CROP SCIENCE PVT. LTD.,
INDUSTRIAL AREA GAMANGATTI,
HUBBALLI, TQ. HUBBALLI,
DIST. DHARWAD.
...PETITIONER
(BY SHRI N L BATAKURKI, ADVOCATE.)
AND:
KARNATAKA STATE GOVERNMENT
REP. BY THE FERTILIZER INSPECTOR
RAITH SAMPARK KENDRA, KOUJALAGI,
O/O ASSISTANT DIRECTOR OF AGRICULTURE,
GOKAK, TQ GOKAK, DIST. BELAGAVI,
REP. BY STATE PUBLIC PROSECUTOR,
HIGH COURT BUILDING, DHARWAD.
RESPONDENT.
(BY SHRI RAMESH CHIGARI, HCGP.)
THIS CRIMINAL PETITION IS FILED UNDER SECTION 482 OF
THE CODE OF CRIMINAL PROCEDURE, 1973, PRAYING TO QUASH THE
2
ORDER OF TAKING COGNIZANCE AND ISSUE OF PROCESS FOR THE
OFFENCES PUNISHABLE UNDER CLAUSE 19 OF FERTILIZER
(CONTROL) ORDER, 1985 READ WITH SECTION 3 AND 7 OF THE
ESSENTIAL COMMODITIES ACT BY THE CIVIL JUDGE AND JMFC,
MUDALAGI, IN C.C.NO.836/2018 DATED 05.09.2018 AGAINST THE
PETITIONER/ACCUSED NO.1 HEREIN, VIDE ANNEXURE-A AND
CONSEQUENTLY QUASH THE COMPLAINT VIDE ANNEXURE-B
AGAINST THE PETITIONER HEREIN, ETC.,.
THIS PETITION COMING ON FOR ADMISSION THIS DAY, THE
COURT PASSED THE FOLLOWING:
ORDER
Heard learned counsel appearing of the petitioner and the
learned HCGP appearing for the respondent-State.
2. The petition is filed calling in question the
proceedings instituted against the petitioner for the offence
punishable under Sections 3 and 7 of the Essential Commodities
Act, 1955. The allegation is against the Company. The complaint
without at the outset making the Company as a party/accused
to the proceedings would be not maintainable in the light of
Section 10 of the Essential Commodities Act, 1955.
3. Section 10 of the Essential Commodities Act, 1955
reads as follows:
"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: 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.
(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.
Explanation.--For the purposes 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.
4. Section 10 of the Act is in pari materia with Section
141 of the Negotiable Instruments Act, 1881, which is
interpreted by the Apex Court in the case of Aneeta Hada vs.
Godfather Travels & Tours Pvt. Ltd., reported in (2012) 5
SCC 661, wherein the Hon'ble Apex Court has held as follows :
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.
56. We have referred to the aforesaid passages
only to highlight that there has to be 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.
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
dragnet 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 (supra) which is a three-Judge Bench
decision. Thus, the view expressed in Sheoratan
Agarwal (supra) does not correctly lay down the law
and, accordingly, is hereby overruled. The decision in
Anil Hada (supra) is overruled with the qualifier as
stated in paragraph 51. The decision in Modi
Distilleries (supra) has to be treated to be restricted
to its own facts as has been explained by us
hereinabove."
5. In the light of the issue standing covered by the
Judgment rendered by the Apex Court and the admitted fact
that the Company is not a party in these proceeding, the
proceedings are rendered unsustainable and therefore stand
obliterated against the petitioner.
6. For the aforesaid reason, the following :
ORDER
(i) The criminal petition is allowed.
(ii) The proceedings in Criminal Case No.836/2018
pending on the file of Civil Judge and Judicial
Magistrate First Class, Mudalagi, stands
quashed, qua the petitioner.
(iii) Liberty is reserved to the State to initiate such
proceedings in accordance with law if the need
remains at this juncture.
SD
JUDGE
Mrk/-
