Jharkhand High Court
Kishore Biyani,Md Pantaloon (Retail) ... vs State Of Jharkhand & Anr on 29 September, 2015
Author: R.N. Verma
Bench: Ravi Nath Verma
IN THE HIGH COURT OF JHARKHAND AT RANCHI
Cr. M.P. No. 944 of 2009
Kishore Biyani
Son of Late Laxmi Narayan Biyani, Managing Director,
Pantaloon (Retail) India Ltd., Knowledge House, Shyam Nagar,
PS- Meghwadi, Jogeshwari East, Mumbai (Maharashtra)
.... .... Petitioner
--Versus--
1. The State of Jharkhand
2. Krishna Prasad Singh, Food Inspector, Office of the Civil Surgeon-cum-
Chief Medical Officer, Main Road, Ranchi .... .... Opposite Parties
For the petitioners :- Mr. Anil Kumar Sinha, Sr. Advocate,
M/s. Harshvardhan Jha, Abhishek Sinha &
Yugandhara Jha, Advocates
For the State:- :- Ms. Vandana Bharti, Add.P.P.
CORAM: HON‟BLE MR. JUSTICE RAVI NATH VERMA
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C.A.V. ON: 23/09/2015 PRONOUNCED ON-29/09/2015
Invoking the inherent jurisdiction of this Court under
Section 482 of the Code of Criminal Procedure, the petitioner has
prayed for quashing of the order dated 14.05.2008 passed by the
Chief Judicial Magistrate, Ranchi in Complaint Case no. C-IV/41 of
2008 whereby the cognizance of offence under Sections 16 (1) (a) (i) &
(ii) of the Prevention of Food Adulteration Act, 1954 (in short "the
P.F.A.Act") has been taken and has also prayed for quashing of the
entire criminal proceeding so far as it relates to him.
2. Before I state the prosecution case, the background of the
case is necessary to be discussed to appreciate the issue involved in
this case. The petitioner, who is the Managing Director of Pantaloon
Retail (India) Ltd. with its registered office at Jogeshwari, Mumbai,
has his permanent posting at Mumbai but he has to travel all over the
country particularly to the big cities where most of the controlling
centers of the Retail Stores of the company are located. The company
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has hierarchy of officials looking after the various aspects managerial,
financial, Supervisory, Quality, Standard and Safety etc. and all
purchases for the company are made by the Purchase Department,
both from local and outside sources and it is the exclusive liability of
the Quality Control Officers to maintain and ensure the best quality
of each and every item. The petitioner, being the Managing Director
of the company, is concerned with the policy matters and has no
concern with the day-to-day purchase and sale of thousands of
articles and goods being sold in nearly 500 Retails stores of the
company. One such Retail Outlet namely "Big Bazar" was opened at
Ranchi on 28th March, 2008.
3. Now in the above background, let the prosecution case be
examined. At the instance of the Civil Surgeon-cum-Chief Medical
Officer, Ranchi, the prosecution report was sent to the Court of Chief
Judicial Magistrate whereafter, the aforesaid case was lodged with
the allegation that one K.P.Singh, Food Inspector, Ranchi, visited the
"Big Bazar" on 01.04.2008 barely on the 5th day of opening of the store
along with his staff and physically examined hundreds of food items
displayed on the racks as well as from those items, which were yet to
be displayed for sale and took samples of „Chana Sattu' 500 gr. x 3
packaging dated 18th March, 2000, Chana Besan 500 gr. x 3, Chana
Dal 500 gr. x 3 and Toor (Arhar) Dal 500 gr. x 3 of the same dates and
Pure Cow Ghee from the store. The samples were sent to the Public
Analyst of State Food and Drug Laboratory, Namkom, Ranchi for its
analysis. The Public Analyst submitted his report dated 05.05.2008
showing the sample of Toor (Arhar) Dal as the „misbranded‟ within
the meaning of Section 2 (ix) (k) of the P.F.A. Act, 1954 by virtue of
violation of Rule 32 (b) and (e) of the Prevention of Food
Adulteration Rules, 1955 (in short "the Rules, 1955) holding that the
sample does not bear batch number/lot number and details of the
ingredients used as required under the Rules, 1955. On the basis of
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the said report of the Public Analyst, the Civil Surgeon-cum-Chief
Medical Officer forwarded the prosecution report-cum-complaint to
the Chief Judicial Magistrate, Ranchi
4. The Chief Judicial Magistrate, Ranchi being satisfied with
the prima facie case under Section 16 (1) (a) (i) and (ii) of the P.F.A.
Act, took cognizance of the offence under the aforesaid sections.
Thereafter, summons were issued against the present petitioner and
one Nitin Singhania, Assistant Manager of "Big Bazar" at Ranchi.
5. Mr. Anil Kumar Sinha learned senior counsel appearing
for the petitioner while assailing the order taking cognizance of
offence as bad in law and against the settled principles, seriously
contended that the allegations made in the complaint even if taken at
their face value as true together with the report of the Public Analyst,
no offence is made out against this petitioner.
Secondly, in view of the specific bar created under
Section 17 of the P.F.A. Act, when no specific allegation of any act or
involvement or role played by the petitioner is alleged in the
complaint petition, the very initiation of proceeding is not sustainable
and is bad in law.
Thirdly, when the company has not been arrayed as a
party and no summon has been issued, the entire proceeding is
vitiated in view of the mandates given by the Supreme Court in cases
GHCL Employees Stock Option Trust Vs. India Infoline Ltd.; (2013) 4
SCC 505, Aneeta Hada Vs. Godfather Travels and Tours Private
Limited; (2012) 5 SCC 661, S.K. Alagh Vs. State of U.P. and others;
(2008) 5 SCC 662 and State of Haryana Vs. Brijlal Mittal and others;
AIR 1998 S.C. 2327.
Fourthly, it was urged that since the item seized was a
„single ingredient food‟, in view of sub-rule (b)(2) of Rule 32 of Rules,
1955, the mandatory requirement of printing of all the ingredients of
food item was not necessary as in „Toor (Arhar) Dal‟ the only
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ingredient is "Toor (Arhar)". Lastly, it was submitted that the
procedure and mandates prescribed in the amended sub-section (1)
of Section 202 of the Code of Criminal Procedure has not been
followed by the court below before taking cognizance of offence
against the petitioner, who was residing beyond the territorial
jurisdiction of the Court, though the provision makes it obligatory
upon the Court/Magistrate to enquire into the case himself or direct
investigation to be made by a police officer or by such other person as
he thinks fit for finding out whether or not there was sufficient
ground for proceeding. In support of his contention, learned counsel
has put reliance on the principles laid down in the cases Udai
Shankar Awasthi Vs. State of U.P. & anoher.; (2013) 2 SCC 435 and
Vijay Dhanuka etc. Vs. Nazima Mamtaj etc. 2014(2) Supreme 762 on
the amended sub-Section 1 of Section 202 of the Code. As such,
allowing the criminal proceeding to continue against him would
tantamount to abuse of the process of the Code. Hence, the order
taking cognizance and the entire criminal proceeding, as it relates to
the petitioner, are fit to be quashed.
6. Refuting the aforesaid submissions, the learned counsel
representing the State contended that the petitioner being the
Managing Director was responsible for day-to-day affairs of the
company and since there was violation of rule and „misbranding‟ of
items, the court below has rightly taken the cognizance of offence and
issued summons.
7. I have carefully considered the submissions of the learned
counsels and also the decisions relied upon by the learned senior
counsel appearing for the petitioner. It is well settled that judicial
process is not an instrument of needless harassment and the court
should be circumspect and judicious in exercising the discretion and
should take all the relevant facts and circumstances into
consideration before issuing process or taking cognizance of the
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offence. Obviously, summoning of an accused in a criminal case is a
serious matter. The order taking cognizance and summoning of
accused by the court must reflect that the court has applied his
judicial mind to the facts of the case and law applicable thereto.
8. So far as the complaint petition is concerned, there is no
specific allegation or even whisper that petitioner being the
Managing Director of the company was responsible for day-to-day
affairs of the company.
9. Before I enter into the veils of submissions of the counsels
and the judgments relied on by the learned senior counsel for the
petitioner, a reference of sub-rule (b) (2) of Rule 32 of the Rules, 1955
is necessary for the proper adjudication of the issue involved in this
case, which reads as follows:-
Sub-rule (b) of Rule 32.- Labelling of Prepackaged Foods-
Every package of food shall carry the following information on
the label-
(1) The name of the Food- The name of the food shall include
trade name or description of food contained in the package.
(2) List of Ingredients.- Except for single ingredient foods, a
list of ingredients shall be declared on the label in the following
manner:-
(i) the list of ingredients shall contain an appropriate title,
such as the term "ingredients";
(ii) the name of ingredients and their weight or volume used
in the product at the time of its manufacture shall be listed in
descending order;
(iii) where an ingredient itself is the product of two or more
ingredients, such a compound ingredient shall be declared in
the list of ingredients, and shall be accompanied by a list, in
brackets, of its ingredients in descending order of weight or
volume, as cases may be:
Provided that where a compound ingredient, other than
the food additives, which constitutes less than five per cent of
the food, the list of ingredients of such compound ingredient,
need not to be declared.
(iv) ..................
(v) ..................
(vi) .................."
10. Apparently, from bare perusal of the above provision, it
appears that sub-rule(b)(2) of the Rule 32 is applicable in those
packaged foods only where the ingredient is more than one. For
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„single ingredient food‟, like "Toor (Arhar) Dal" where the „Toor
(Arhar)' is the single ingredient, it was not necessary to declare the
list of ingredient as prescribed in the above Rule. In the instant case,
the sample of „Toor (Arhar) Dal' was collected and on the basis of the
report of Public Analyst, allegation of „misbranding‟ has been made,
as the list of ingredients were not specifically mentioned on the
packets. Since it was a single ingredient food product of „Toor
(Arhar)' there was no need to mention ingredients in terms of the
sub-rule (b) (2) of Rule 32.
11. In the instant case, summon has been issued against this
petitioner in his individual capacity being the Managing Director of
the company but neither the company has been made party nor
summons has been issued against the company. The learned
Magistrate while taking cognizance has not assigned any reason or
ground for recording his satisfaction about the prima facie case
against this petitioner or any role played by him in the capacity of
Managing Director of the company, which is sine qua non for
initiating criminal action against a person. Here, I feel it necessary to
refer Section 17 of the P.F.A.Act, which reads as follows:
"Section 17. Offences by companies.- (1) Where an offence under this
Act has been committed by a company-
(a) (i) the person, if any, who has been nominated under sub-section (2)
to be in charge of, and responsible to, the company for the conduct of the
business of the company (hereafter in this section referred to as the person
responsible), or
(ii) where no person has been so nominated, 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; and
(b) 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 provided in this Act if he proves
that the offence was committed without his knowledge and that he
exercised all due diligence to prevent the commission of such offence.
(2) Any company may, by order in writing, authorise any of its
directors or managers (such manager being employed mainly in a
managerial or supervisory capacity) to exercise all such powers and take
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all such steps as may be necessary or expedient to prevent the commission
by the company of any offence under this Act and may give notice to the
Local (Health) Authority, in such form and in such manner as may be
prescribed, that it has nominated such director or manager as the person
responsible, along with the written consent of such director or manager
for being so nominated.
Explanation.- Where a company has different establishments or
branches or different units in any establishment or branch, different
persons may be nominated under this sub-section in relation to different
establishments or branches or units and the person nominated in relation
to any establishment, branch or unit shall be deemed to be the person
responsible in respect of such establishment, branch or unit.
(3) The person nominated under sub-section (2) shall, until-
(i) further notice cancelling such nomination is received from the
company by the Local (Health) Authority; or
(ii) he ceases to be a director or, as the case may be, manager of the
company; or
(iii) he makes a request in writing to the Local (Health) Authority, under
intimation to the company, to cancel the nomination [which request shall
be complied with by the Local (Health) Authority],
whichever is the earliest, continue to be the person responsible:
Provided that where such person ceases to be a director or, as the
case may be, manager of the company, he shall intimate the fact of such
cesser to the Local (Health) Authority:
Provided further that where such person makes a request under
clause (iii), the Local(Health) Authority shall not cancel such nomination
with effect from a date earlier than the date on which the request is made.
(4)Notwithstanding anything contained in the foregoing sub-
sections, 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 [not
being a person nominated under sub-section (2)] such director, manager,
secretary or other officer shall also be deemed to be guilty of that offence
and shall beliable to be proceeded against and punished accordingly."
12. The very provision and the explanation makes it clear
that when the company can be prosecuted, only then the persons
mentioned in the categories could be vicariously liable for the offence
unless his or their specific role played is not mentioned in the
complaint petition. In the case Aneeta Hada (supra) relied by the
learned senior counsel, the Hon‟ble Supreme Court considering
almost a similar situation, held in paragraph 58 as follows:
"58. Applying the doctrine of strict construction, we are of the
considered opinion that commission of offence by the company is an
express condition precedent to attract the vicarious liability of
others. Thus, the words "as well as the company" appearing in the
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section make it absolutely unmistakably clear that when the
company can be prosecuted, then only the persons mentioned in the
other categories could be vicariously liable for the offence subject to
the averments in the petition and proof thereof. One cannot be
oblivious of the fact that the company is a juristic person and it has
its own respectability. If a finding is recorded against it, it would
create a concavity in its reputation. There can be situations when the
corporate reputation is affected when a Director is indicated."
13. The learned senior counsel has relied on several
judgments on the same point, so it is not necessary to quote various
passages from those judgments. In view of the ratio decided in the
above judgment, it is amply clear that for maintaining prosecution as
envisaged in Section 17 of the P.F.A. Act, arraigning of a company as
an accused is mandatory. The other person in hierarchy like the
petitioner can only be brought in the net on the principle of vicarious
liability as the same has been stipulated in the above provision itself.
14. So far as non-compliance of the amended sub-section(1)
of Section 202 CrPC is concerned, learned senior counsel has relied
on the judgment of the Hon‟ble Supreme Court delivered in the case
Udai Shankar Awasthi(supra) where the Hon‟ble Supreme Court in
paragraph-40 has held as follows:
"40. The Magistrate had issued summons without meeting the
mandatory requirement of Section 202 CrPC, though the
appellants were outside his territorial jurisdiction. The
provisions of Section 202 CrPC were amended vide the
Amendment Act, 2005, making it mandatory to postpone the issue
of process where the accused resides in an area beyond the
territorial jurisdiction of the Magistrate concerned. The same
was found necessary in order to protect innocent persons from
being harassed by unscrupulous persons and making it
obligatory upon the Magistrate to enquire into the case himself,
or to direct investigation to be made by a police officer, or by
such other person as he thinks fit for the purpose of finding out
whether or not, there was sufficient ground for proceeding
against the accused before issuing summons in such cases."
15. Apparently, the company Pantaloon Retail (India) Ltd.
has not been arrayed as an accused; secondly the court below while
taking cognizance of the offence and issuing summon has not
followed the mandates of amended sub-section(1) of Section 202 of
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the Code of Criminal Procedure or recorded his satisfaction about the
prima facie case against the petitioner and the fact that the sample
collected of „Toor (Arhar) Dal' having a single ingredient foods does
not come within the ambit of sub-rule (b) (2) of Rule 32, in my
opinion, the petitioner could not have been held liable for the offence
under Section 16 (1) (a) (i) & (ii) of the P.F.A. Act. Accordingly, the
order taking cognizance as well as the continuance of the criminal
proceeding against the petitioner, being absolutely uncalled for,
deserves to be quashed.
16. In the result, the entire criminal proceeding of the court
below including the order taking cognizance of the offence, which
relates to the petitioner dated 14.05.2008 passed by learned Chief
Judicial Magistrate, Ranchi in Complaint Case No. C-IV-44/2008 are,
hereby, quashed.
17. This Criminal Miscellaneous Petition is, accordingly,
allowed.
(R.N. Verma, J.)
Jharkhand High Court, Ranchi
Dated, 29th September, 2015
Ritesh/N.A.F.R.