Karnataka High Court
Sri. Jitendra Virwani vs The State Of Karnataka on 14 August, 2013
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IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 14TH DAY OF AUGUST 2013
BEFORE
THE HON'BLE MR JUSTICE K. N. KESHAVANARAYANA
CRIMINAL PETITION No.4183/2013
BETWEEN:
Sri. Jitendra Virwani,
Executive Director,
M/s. Embassy Property
Developments Limited,
No.150, Embassy Point,
Infantry Road,
Bangalore 560 001. ... Petitioner
(By Sri. Mahesh. S., Advocate)
AND:
The State of Karnataka,
By Sri. Ravindranath.N.Rathod,
Senior Assistant Director of Factories,
(An Inspector appointed under
BOCW (RE & CS) Act, 1996),
Division-5, 2nd Floor,
Karmika Bhavan,
Bannerghatta Road,
Bangalore 560 029. ... Respondent
(By Sri.K.Dilip Kumar, HCGP)
This Criminal Petition is filed under Section 482 of the
Cr.P.C praying to quash the entire criminal proceedings against the
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petitioner herein in C.C.No.191/2013 and all its consequent
proceedings pending on the file of the Metropolitan Magistrate
Traffic Court-I, Mayo Hall, Bangalore.
This Criminal Petition coming for admission on this day,
the Court made the following:
ORDER
Though the matter is listed today for admission, with the consent of learned counsels appearing on both sides, the same is heard for final disposal in view of the fact that the question of law raised is covered by the decision of the Apex Court and also this court.
2. In this petition, filed under Section 482 of Cr.P.C., the petitioner has sought for quashing the prosecution launched against them in CC No. 191/2013 on the file of the Metropolitan Magistrate, Traffic Court-I, Mayo Hall, Bangalore City, for the offence punishable under Section 47 of the Building and other Construction Workers' (Regulation of Employment and Conditions of Services) Act, 1996 ( for short 'the Act') and the Rules framed thereunder. The petitioner is sought to be prosecuted in the capacity of Executive Director of 3 M/s Embassy Property Developments Private Limited (hereinafter referred to as 'the Company' )
3. The point of law raised in this petition is, whether the prosecution launched against the petitioner for the aforesaid offence as Executive Director of the Company, without the company having been arraigned as accused, is tenable.
4. Section 53 of the Act deals with the offence by Company and the said Section reads thus:
"Offences by companies.-
(1) Where an offence under this Act has been committed by a Company, 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, as well as 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, if he proves that the offence was committed without his knowledge or that he had 4 exercised all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in sub-section (1), where any 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 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 anybody corporate and includes a firm or other association of individuals, and
(b) "Director", in relation to a firm means a partner in the firm."
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5. Thus, from reading of the aforesaid Section, it is clear that if the offence alleged is committed by the Company, then the Company as well as all other persons, who at the time of commission of offence were incharge and responsible to the Company for the conduct of the business of the company, are deemed to be guilty of such offence and they are liable to be proceeded and punished accordingly.
6. Similar provision contained in Section 141 of the Negotiable Instruments Act (in short 'the NI Act') came up for consideration before the larger Bench of Apex Court in the case of ANEETA HADA Vs. GODFATHER TRAVELS AND TOURS PRIVATE LIMITED reported in 2012(5) SCC 661. The Apex Court has held that to prosecute the functionaries of the Company for the offence committed by the Company, there should be specific averments in the complaint to the effect that such person/s was/is incharge of and being responsible for conduct of business of the Company and in the absence of such specific averment, the functionaries of the Company cannot be prosecuted. It is further held in the said decision 6 that commission of offence by the company is an express condition precedent to attract the vicarious liability of others. It is further held that the words "as well as the company"
appearing in Section make it clear that when the Company can be prosecuted, then only persons mentioned in the other categories could be vicariously liable for offence subject to the averments in the petition and proof thereof.
7. Section 141 of the N.I. Act, is in analogous to Section 53 of the Act. Therefore, the principles of law laid down in Aneeta Hada's case squarely applies to the facts of the case. Admittedly, in the case on hand the Company which is the principal offender has not been prosecuted. The petitioner in the present case is an Executive Director of the company and he is being prosecuted in that capacity.
8. Therefore, in the light of the law laid down in the aforesaid decision, the prosecution launched against these petitioners as functionaries of the company, is not maintainable since the company is not being prosecuted. In 7 this view of the matter, the prosecution launched against these petitioners are liable to be quashed.
9. Accordingly, the petition is allowed. The prosecution launched against these petitioners in C.C. No. 191/2013 on the file of the Metropolitan Magistrate Traffic Court - I, Mayo Hall, Bangalore City, is hereby quashed.
SD/-
JUDGE KGR*