Delhi High Court
Adarsh Marwah And Anr. vs Nehar Ranjan Bhattacharya And Anr. on 15 March, 1990
Equivalent citations: 41(1990)DLT167
JUDGMENT Bahri, J.
(1) Adarsh Marwah and Bihari Lal partners of M/s. Neha Agencies have brought this petition under Section 482 of the Code of Criminal Procedure for quashing the proceedings pending in the Court of Shri S.L. Khanna, Chief Metropolitan Magistrate on the basis of the complaint filed by respondent No. I for prosecuting the petitioners and one Mahinder Kumar and M/s. Neha. Agencies.
(2) Facts, in brief, are that M/s. Neha Agencies is a partnership firm of which Bihari Lal and Adarsh Marwah are the partners while Mahinder Kumar is the Manager. On November 27, 1986 at about 12.30 P.M. complaint in the presence of public witnesses had inspected the premises of the said partnership firm situated at D-4, Laxmi Nagar, Vikas Marg, Delhi and Mahinder Kumar was present at that time and it was found that Panjon tablets manufactured by M/s. Panama Chemical Works, Bombay stood stocked in the said premises and exhibited the same for sale and distribution. Two samples of the aforesaid drug were taken from Mabinder Kumar and they were duly sealed and after filling in necessary forms, notice was given to the said accused and he gave a letter to the complainant disclosing that Neha Agencies, partnership firm has been dealing with wholesale business of Ayurvedic drugs like Panjon tablets and has been selling the same to different dealers in Delhi and he himself has been working as a Manager while the other two accused are partners of the fourth accused, namely, partnership firm M/s. Neha Agencies. The samples were got analysed from Government Analayst, Delhi Drug Testing Laboratory, Bangalore. Then evidence was collected from three firms where the said drug has been sold by M/s. Neha Agencies. It was mentioned in the complaint that the said partnership firm was not holding any license to manufacture or exhibit and distribute the said drug as required under the Drugs & Cosmetics Rules 1945 framed under the Drugs & Cosmetics Act 1940 and thus the aforesaid four accused have contravened the provisions of Section 18(c) of the Act and thereby committed the offence punishable under Section 27(d)(ii). They were also prosecuted for contravening the provisions of Section 18A and thereby committed an offence punishable under Section 28 of the Act. It was mentioned in the complaint that all the three accused i.e. Manager and the two partners of the partnership firm were jointly responsible to conduct the business of the said partnership firm on the date the samples were taken.
(3) The learned counsel for the petitioners has pressed for quashment of the proceedings qua Smt. Adarsh Marwah only at the stage of arguments. He has urged that neither in the complaint nor in the documents filed Along with the complaint, it is disclosed as to how petitioner Smt. Adarsh Marwah has been in charges of and responsible for the conduct of the business of the partnership firm and in the absence of any such evidence and material, the criminal proceedings against Smt. Adarsh Marwah should not be allowed to be continued.
(4) I have gone through the complaint as well as the statement of the complainant made as Public Witness -1 before the Court concerned and find that except for saying that this petitioner Adrash Marwah is one of the partners of the said partnership firm, not a single sentence has been uttered as to how she has been found to be in charge of and responsible for the conduct of the partnership business. Section 34 of the Drugs & Cosmetics Act 1940 clearly lays down that where any offence in 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. Mere Indian Police Service dixit of the complainant is not enough to bring home the offence to the partners of the partnership firm for the offence committed by the partnership firm. Again mere re-production of the language of Section 34 in the complaint per be is not sufficient to proceed against the partners of the firm for prosecuting them for their vicarious liability for the offeree committed by the partnership firm. Partners of the firm were not even present at the time the samples were lifted. . It is not mentioned in the complaint that the complainant had made any inquiries and had collected any evidence to show that Adarsh Marwah who admittedly is the partner of the said partnership firm was in charge of and was responsible to the partnership firm for the conduct of the business of the said firm at the time the samples were lifted. In the absence of any evidence in support of allegations that she was in charge and was responsible for the conduct of the partnership business, the complaint could not have been brought against Adarsh Marwah.
(5) Learned counsel for the respondent has argued that onus lies on the partner to show that the offence was committed by the partnership firm without his knowledge and/or that he exercised all due diligence to prevent the commission of such offence and thus it is only when evidence is recorded in the complaint and the partner concerned is able to lead evidence in the light of the provision to Section 34(1) of the Act that the partner can escape the criminal liability. There is no merit in this contention. The question of a application of the provision to Section 34(1) of the Act would come into consideration only if the complainant has been able to prove and establish that a particular partner has been in charge of and was responsible to the partnership firm for the conduct of the business of such partnership firm. The onus on that scope always remains on the proscution. Unless and untill such an onus is discharged by the prosecution, the accused is not supposed to lead evidence to take advantage of the said proviso to Section 34(1) of the Act.
(6) In the present case the learned counsel for the respondent has not been able to refer to any piece of evidence or any facts mentioned in the complaint to show that Adarsh Marwah petitioner was in charge of and was responsible to the partnership firm for the conduct of the business of the partnership firm at the time the samples were lifted.
(7) I may refer to Municipal Corporation of Delhi versus Ram Kishan Rohtagi and others; wherein the facts were that a complaint has been filed against the Company, its Directors and the Manager in regard to lifting of a sample from his shop which sample was found to be adulterated. As far as the Directors were concerned, there was not even a whisper nor a shred of evidence, nor anything to show apart from the presumption drawn by the complainant that there is any act committed by the Directors from which a reasonable inference can be drawn that they could also be vicariously liable. It was held by the Supreme Court that in the light of those circumstances the allegations made in the complaint, ex fade the proceedings against the Directors could not be allowed to continue. The Supreme Court held that proceedings against an accused in the initial stage can be quashed only if on the face of the complaint or the papers accompanying the same, no offence is constituted. In other words, the test is that taking the allegations and the complainant as they are, without adding or subtracting anything, if no offence is made out then the High Court will be justified in quashing the proceedings in exercise of its powers under Section 482 of the Code.
(8) I may also refer to a recent judgment of the Supreme Court in Shyam Sunder versus State of Haryana; . In this case Section 10 of the Essential Commodities Act 1955 came up for consideration which also lays down the vicarious criminal liability of a person if he is in charge of and was responsible to the firm for the conduct of the business of the firm. After noticing the role of a partner in the partnership firm which is not a legal entity and which is only a collective name for individuals carrying on business in partnership and the essential characteristic of the partnership being that each partner is a representative of other partners and each partner is an agent as well as a principal, the Supreme Court held that the penal provisions must be strictly construed and there is no vicarious liability in criminal law unless Statute takes that also within its fold and it was held that Section 10 does not provide for such a liability as it does not make all the partners liable for the offence whether they had business or not. The Supreme Court laid down that they may be partners better known a sleeping partners but are. not required to take part in the business so the firm and there may be ladies and minors and they may not know anything about the business of the firm and it should be a travesty of jutice to prosecute all partners and ask them to prove under the proviso that the offence was committed without their knowledge. The Supreme Court laid down that the proviso would apply if the prosecution has been able to establish that a particular partner has been. in charge of and was responsible to the partnership firm or the conduct of the business. In the cited case apart from the fact being mentioned that petitioner was partner of the firm, there was no evidence collected in support of the charge that the partner has been in charge of and responsible for the conduct of the business of the partnership firm. The conviction of the partner was set aside. So, following the aforesaid ratio, I hold that petitioner Adarsh Marwash could net have been proceeded against on the basis of the present complaint.
(9) I allow this petition and quash the proceedings in the aforesaid complaint qua petitioner Adarsh Marwah alone. The trial Court file be returned to the trial Court for proceedings against the other accused.