Karnataka High Court
Food World Super Markets Ltd. And Ors. vs State At The Instance Of The Drugs ... on 12 December, 2007
Equivalent citations: ILR2008KAR664, 2008 CRI. L. J. (NOC) 417 (KAR.) = 2008 (2) AIR KAR R 80, 2008 (2) AIR KAR R 80
Author: Subhash B. Adi
Bench: Subhash B. Adi
ORDER Subhash B. Adi, J.
1. A private complaint is lodged by the State on behalf of the Drugs Control Department, Bangalore for an offence punishable under Section 7(1)(a) Sub-clause (ii) of the Essential Commodities Act.
2. The case alleged against the petitioners is that, the officials of the Drugs Control Department visited the retail shop of accused No. 1 - Company and found that, the Itch Guard 25 mg cream was sold at higher rate than the MRP + local taxes, In this regard, it is noticed that, a stacker was fixed showing the MRP at Rs. 31/- with bar code No. 024975. The officials seized three such Itch Guard cream under the panchanama dated 16.8.2002. They verified the MRP of the said product and found that, as per the purchase invoice No. 6513 dated 9.8.2002, the Itch Guard 25 mg cream batch No. IG119, the MRP is fixed at Rs. 24.70 paise + local taxes extra. Calculating the local taxes at 12%, the total value of the Itch Guard comes to Rs. 27,66 paise. However, the accused No. 1 - Company has fixed the price at Rs. 31/- i.e., Rs. 3.34 paise extra on the said product. On the basis of the said material, a complaint was filed along with the necessary documents and also the list of items seized and the witnesses, The complainant being the State, cognizance was taken by the learned Magistrate, The learned Magistrate after considering the averments, passed an order for issuing summons.
3. Petitioners have called in question the proceedings on the file of the Special Criminal Court in C.C. No. 19969/2003 on the file of the III Additional C.M.M., Bangalore.
4. Learned Counsel appealing for the petitioners submits that, the violation of the provisions of the control order under the Essential Commodities Act are penal in nature and they are required to be construed strictly. In this regard, he relied on the Drugs (Prices Control) Order, 1995 and pointed out that the said provision reads as under:
Para-16 of DPCO 1995 No person shall sell any bulk drug or formulation to any consumer at a price exceeding the price specified in the current price list or price indicated on the label of the container or pack thereof, whichever is less, plus all local taxes, if any, payable.
Para 20 of DPCO 1995 20(1) Every manufacturer and importer shall maintain in such form as may be specified by the Government, records relating to the sales turnover of individual bulk drugs manufactured or imported by him, as the case may be directed from time to time, by the Government and the Government shall have power to call for such records or to inspect such records at the premises of the manufacturer or importer.
20(2) Every manufacturer or importer shall, within six months of the close of the accounting year, submit to the Government information in respect of turnover and allocation of sales and expenses for that year in Form VI.
20(3) Every dealer, manufacturer or importer shall maintain the cash memo or credit memo, books of account and records of purchase and sale of drugs and shall make available such records for inspection by the Government or any officer authorized in this behalf by the Government.
Relying on the said provision, he submitted that, no person shall sell any bulk drug or formulation to any consumer at a price exceeding the price specified in the current price list or price indicated on the label of the container or pack thereof, whichever is less, plus all local taxes, if any, payable and submitted that, it is only when the product is actually sold, the offence is alleged to have been committed, The offence cannot be alleged without the product having been sold, He also submitted that, petitioners-2 to 6 are the Directors and the petitioner No. 7 is the Assistant Manager, petitioner No. 8 is the Supervisor and they are not responsible for the discharge of the duties and function in the matter of fixing of the price. He submitted that, unless the complaint makes out a case against an individual Director as regard to the discharge of their function in connection with the offence, a case ought not to have been registered against them and the Magistrate was not justified in issuing summons against these Directors are concerned. He further submitted that, in case of Company, the Directors cannot be automatically held responsible for the discharge of the function in the matter of criminal offence. It is only the persons, who are connected with the discharge of such functions, which are alleged to have been committed, they are only the persons against whom the complaint can be lodged and not against everyone.
5. In this connection, he relied on a decision in the matter of Municipal Corporation of Delhi v. Ram Kishan Rohtagi and Ors. and submitted that, under Section 482 Cr.P.C., the Court in exercise its power can quash the proceedings, if it finds that the allegation made in the complaint or the statements of the witnesses in support of the complaint, on the lace of it. does not make out any case against the accused or the allegations in the complaint patently absurd or inherently improbable or the exercise of power by the Magistrate is capricious and arbitrary and is based on no evidence or material or have fundamental legal detects. He submitted that, insofar as the Directors - petitioner Nos. 2 to 6 are concerned, there is no allegation in the complaint as to whether, they are responsible for the discharge of the function in the matter of fixing of the price. He further submitted that, just because they are Directors, the allegation of committing offence cannot be automatically made. He further submitted that, reading of entire complaint does not make out any case against the petitioners and the initiation of the proceedings against these petitioners is perse illegal and is in violation of the provisions of Section 204 of Cr.RC.
6. Learned Government Pleader submits that the officials of the Drugs Control Department made inspection of the shop and found the violation of the Drugs (Prices Control) Order in the matter of fixing of price and the said officials seized the product, there is a clear violation of the Drugs Control Order, which constitutes an offence punishable under Section 7 of the Essential Commodities Act and the petitioners being the Directors, the Manager and Supervisor, they are all jointly and severally responsible for the discharge of the function, individually it cannot be dissected and say that particular person is in-charge in the matter of the Company.
7. Looking at the complaint prima facie, it makes out a case for violation of Section 7(1) of the Essential Commodities Act for violation of the provisions of the (sic) (Prices Control) Order, as the products seized by the authority shows that the price fixed on the product is more than the MRP and the local taxes. However, the question that arises for consideration is:
Whether alt the Directors are responsible for the said offence or only the persons in-charge?
8. In the complaint at para-3, except reference to accused Nos. 2, 3, 4, 5, 6 and 7, nothing is stated as against these persons, However, insofar as accused No. 8 is concerned, it is stated that he is the Assistant Manager of accused No. 1 -Company and the accused No. 9 is the person in-charge (Supervisor) of accused No. 1.
9. Looking into the allegations made in the complaint and the business transaction insofar as accused Nos. 8 and 9 are concerned, the complaint makes out a case showing that, they are the persons, who are responsible for the discharge of the function in the matter of fixing of the price. However, insofar as Directors are concerned, nothing has alleged in the complaint as to how they are responsible for the alleged offence. The Apex Court has observed that, on the face of the complaint or papers accompanying the same, no offence is constituted, the Court can invoke the provisions of Section 482 Cr.P.C. for quashing the said proceedings. While considering the proceedings under Section 482 Cr.P.C., it is required to be noticed, as to whether the allegation made in the complaint and the sworn statement in support of the said complaint, makes out a case against the accused and if no case is made out against the accused, continuing the proceedings insofar as those accused would be vitiated.
10. The provisions of the Code of Criminal Procedure are inquired to be construed strictly, in order to prevent inherently improbable cases being tried. Further the allegation in the complaint or sworn statement or document, if any, prima facie should make out. a case, in the absence of such material is wholly unjustified, in this case, looking into the allegations and the material produced by the prosecution, it only reveals that the accused Nos. 8 and 9 against whom there is a specific allegation that they are responsible for discharge of the particular function, insofar as accused No. 7 is concerned, it is stated that, he is the Power of Attorney of accused No. 1 and it appears that, he is the person in-charge of the shops of the accused No, 1 in Karnataka. I do not find any justification in proceeding against accused No. 7 unless it is specifically alleged that, he is actually responsible or substantially concerned with the alleged offence. Hence, in my opinion, the proceedings insofar as petitioner Nos. 2 to 6 are concerned, are vitiated, However, the proceedings would continue insofar as petitioner Nos. 7 and 8 are concerned, who are Assistant Manager and Supervisor respectively.
11. Accordingly, the petition is partly allowed. The proceedings insofar as petitioner Nos. 2 to 6 are concerned, are quashed. The proceedings shall go on as against petitioner Nos. 7 and 8.