Punjab-Haryana High Court
Subhash Chand @ Subhash K. Aggarwal vs State (Chandigarh Administration) on 7 September, 2010
Crl. Misc. No. M-121 of 2006 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
(1) Crl. Misc. No. M-121 of 2006 (O&M)
Subhash Chand @ Subhash K. Aggarwal ...Petitioner
Versus
State (Chandigarh Administration), Chandigarh ...Respondent
(2) Crl. Misc. No. M-1260 of 2006 (O&M)
Date of decision: September 7,2010
Subhash Chand @ Subhash K. Aggarwal ...Petitioner
Versus
State (Chandigarh Administration), Chandigarh ...Respondent
CORAM:- HON'BLE MR. JUSTICE GURDEV SINGH
Argued by:- Mr. GS Sawhney, Advocate,
for the petitioner.
Mr. Rajeev Sharma, Advocate,
for U.T., Chandigarh.
GURDEV SINGH, J.
The petitions, bearing Criminal Misc. Nos. M- 121 and 1260 of 2006, are being decided by this common order as similar facts, parties and question of law are involved.
Petitioner-Subhash Chand @ Subhash K. Aggarwal and Murari Lal were partners of the firm M/s Laxmi Oil Traders and they had been running the business of sale of different food articles, including the refined vegetable oil and mustard oil, in Industrial Area, Phase-I, Chandigarh. The licence of the shop was in the name of the petitioner. On 23.2.2005, Sanjay Crl. Misc. No. M-121 of 2006 2 Kumar, Food Inspector inspected the premises of the firm and at that time Murari Lal, partner of the firm, was found in possession of 20 packets of Shalimar refined vegetable oil and 10 boxes of sealed bottles (one litre each of Maa Vaishno) of double filtered mustard oil, for the purposes of sale. Separate notices in respect of those articles of food in form-VI were served upon him by the Food Inspector and the samples thereof were taken in accordance with the Rules framed under the Prevention of Food Adulteration Act, 1954 (hereinafter referred to as 'the Act'). One part each of those samples was sent to the Public Analyst, Punjab, Chandigarh, for analysis and the other parts of the samples were deposited with the LHA, U.T., Chandigarh. The reports of the Public Analyst were received. In respect of the sample of the refined vegetable oil, it was reported that moisture contents were 0.18% against the maximum prescribed standard of 0.1% and the nature of the articles had not been given on the sample packet, as required by the provision of Rule 32 and in respect of the sample of mustard oil, it was reported by the Public Analyst that the sample gave 61.0 of Butyrorefractometer reading at 40.C, 181.71 of Saponificatioin Value & 118.14 of Iodine value against the maximum specified limits of 60.5, 177 and 112 respectively; and the sample also gave 21.0 C of Bellier Turbidity temperature against the minimum specified limit of 23.0 C. Thus, the samples were found to be adulterated and misbranded. Complaint PFA Case No. SB-7 dated 30.5.2005 (Annexure P/2 in Crl. Misc. No. M-121 of 2006) and complaint PFA Case No. SB-7 dated 16.5.2005 (Annexure P/3 in Cril. Misc. No. M-1260 of 2006) were filed against the present petitioner and Murari Lal, under Section 7 (i) 7 (ii) and Section 16 (1) (a) (i) of the Act.
Crl. Misc. No. M-121 of 2006 3
These petitions have been filed for quashing of the complaints and the subsequent proceedings pending before the Chief Judicial Magistrate, Chandigarh. It has been pleaded by the petitioner in the petitions that no offence whatsoever is made out against him from the contents of the complaints and, as such, cognizance could not have been taken by the trial court. There is no specific allegations in the complaints as to in what capacity he was liable to be prosecuted. There is no such allegations in the complaint that he was in charge of and responsible for the conduct of the business on behalf of the firm or that he was involved in any manner in the commission of these offences. No notice in form VI was served upon him and in the absence of such notice, it can not be said that any article was sold by him to the Food Inspector. The samples were taken from other partner, Murari Lal, and he has no knowledge about the same.
Though the petitioner pleaded other grounds also for quashing of these complaints, yet the same were never pressed at the time of the arguments and those were confined to the facts stated above.
Replies were filed by the respondents in which the contentions of the petitioner were denied. It has been pleaded therein that the name of the petitioner was disclosed to the Food Inspector by the other partner Murari Lal at the time of taking of the samples. The petitioner was not only the partner but also the licencee. Therefore, he is liable in that capacity and specific averments have been made to that effect in the complaints. No wrong has been committed by the trial court by taking cognizance of the case. The Food Inspector had directed Murari Lal/accused to hand over the notice in form VI to the petitioner and that endorsement was duly signed by Murari Lal on the day, samples were taken. Therefore, it cannot be said that Crl. Misc. No. M-121 of 2006 4 no such notices were served upon the petitioner.
Learned counsel for the parties were heard at length.
It was submitted by the learned counsel for the petitioner that the petitioner as partner of the firm could have been made liable, only if he was the in-charge of and responsible for the conduct of the business on behalf of the firm. No such averments were made in the complaints. He also submitted that the firm was not arrayed as accused and in the absence of that firm, the petitioner cannot be prosecuted and the complaints are liable to be quashed on that grounds alone. He placed reliance on the following rulings:-
(1) Maj. General (Retd.) C.L. Piplani Versus State (UOI) 2002 (1) RCC, 261;
(2) Sham Sundar and ors Versus State of Haryana RCR (Criminal) 1989 (1) 494;
(3) M/s Oswal Agro Sales Corporation and others Versus State of Punjab 2006 (1) RCR (Criminal) 602; (4) Carborandum Universal, Madras-9 and others Versus The Food Inspector, Thiruvottiyur Municipality 1989 (1) Prevention of Food Adulteration Cases, 367; (5) K.V. Kathrani and others Versus Delhi Administration 1986 (1) Recent Criminal Reports, 508; (6) C.Rajalakshmi Versus State through Food Inspector, Dindigul Municipality, Dindigul 1991 (1) Prevention of Food Adulteration Cases 272; and (7) Smt. Manibai and another Versus The State of Maharashtra 1973 Prevention of Food Adulteration Crl. Misc. No. M-121 of 2006 5 Cases, 349.
On the other hand, it was contended by the learned counsel for the respondent that it is an admitted fact that the petitioner was the partner of the firm. Even the licence of the shop was in his name. He was directly responsible to the firm for the conduct of the business. At the time of the inspection of the premises of the firm by the Food Inspector, it was disclosed by the other partner Murari Lal that the present petitioner was also the partner and the licencee. The liability of the petitioner is vicarious and he is liable for the acts of the other partner. The complaints cannot be quashed on the submissions so made by the learned counsel for the petitioner.
Section 17 of the Act deals with the offences by the Companies. As per the explanation appended to that section "Company" means any body corporate and includes a firm or other association of individuals. According to sub section (1) thereof, where an offence under this Act has been committed by a company and no person has been nominated under sub section (ii), every person, who at the time of the offence was committed, was in charge of and responsible to the company for the conduct of the business of the company and the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly. It is the case of the complainant himself that it was the premises of the firm which was inspected and at that time one of the partners; namely, Murari Lal, was found present and the samples of the articles of food were taken after serving the requisite notices upon him. The complaints have been filed against the petitioner, being a partner and licencee. In that eventuality, it was incumbent on the part of the Crl. Misc. No. M-121 of 2006 6 complainant to aver in the complaint that he was in charge of and responsible to the firm for the conduct of the business. No such averment has been made in any of the complaints.
The question as to the criminal liability of a partner of a firm has drawn the attention of this Court, the Hon'ble Supreme Court and the other High Courts from time to time. Some of the rulings cited by the learned counsel for the petitioner have been given in those cases, where similar provisions of the other Acts were involved.
In Maj. General (Retd). C.L. Piplani's case (supra), which was under the Import and Export (Control) Act, it was held that where the offences were allegedly committed by a partnership firm, all the partners thereof would not be prosecuted and the person, who was entrusted with the business of the firm and who was responsible for the conduct of business, could be prosecuted.
In Sham Sundar' s case (supra), the provisions of Section 10 of the Essential Commodities Act, 1955 were interpreted by the Hon'ble Supreme Court. It was held therein that where the offences are committed by the partnership firm, all individual partners thereof are not to be prosecuted and only the person, who was entrusted with the business of the firm and was responsible for conduct of the business could be prosecuted. Similar proposition of law was laid down in M/s Oswal Agro Sales Corporation' s case (supra), and that was also a case under the Essential Commodities Act, 1955.
However, in other judgments, so cited by the learned counsel for the petitioner, it was the provisions of this Act, which were the subject matter. In Carborandum Universal, Madras-9' s case (supra), there was no Crl. Misc. No. M-121 of 2006 7 specific pleading in the complaint that the petitioner was in charge of and responsible to the conduct of the business of the firm. It was held that the proceedings against the petitioner are liable to be quashed.
In K..V. Kathrani' s case (supra), though there was allegations in the complaint that all the partners were responsible to the firm for the conduct of the business of the firm, yet no evidence was produced in support of that averment. It was held there that whole body of directors of the company cannot be said to be in charge of the day to day management for running of the business of the company and, as such, they cannot be fixed with the knowledge of every working of the company. So, only the officers or directors of the company, who are exercising actual control over the business of the company, can be held vicariously liable in terms of sub section (1) of Section 17 of the Act.
Like the present case, in C. Rajalakshmi's case (supra) the petitioner was the licencee and partner of the canteen, from where the sample of curd was taken. Nothing was stated in the complaint or in any of the records forwarded to the court that the petitioner was in charge of and was responsible for the conduct of the canteen. It was held therein that it is settled law that in the absence of basic allegations in the complaint, while exercising inherent powers, the prosecution can be quashed.
In Smt. Manibai's case (supra), it was Manibai-petitioner, who was licencee of the shop. However, there was nothing to show that the business carried on the shop was that of a firm and that Manibai was a partner of that firm. It was held by the Hon'ble Supreme Court that even if it may be assumed that the business was owned by a firm or an association of individuals and Manibai was partner of the firm or member of association Crl. Misc. No. M-121 of 2006 8 of individuals, she would be liable to be prosecuted under Section 17 (1) of the Act for the sale, which was made by her son, only if it was shown that she was in charge of and responsible for the conduct of the business, which was carried on in the shop.
From all these judgments, it becomes crystal clear that in order to make the a partner of a firm liable for the offences under the Act, it is necessary for the complainant to aver and prove that the said partner was in charge of and was responsible to the firm for the conduct of the business of the firm. As already stated above, there is no averment against the petitioner that he was in charge of and was responsible for the conduct of the business of the firm. The articles of food were never sold by him to the Food Inspector but were sold by the other partner. In the absence of such averment, he cannot be made liable vicariously.
In view of the above discussion, these petitions are hereby accepted and the above noted complaints and the subsequent proceedings are ordered to be quashed qua the petitioner.
September 7, 2010 (GURDEV SINGH ) prem JUDGE