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39. Thereupon, the Director of Public Prosecutions filed an appeal. In that appeal, it was contended on behalf of the appellant that the company is a fictional entity and the ordinary doctrine relating to master and servant cannot be applied when dealing with criminal offences committed by the officers of a company and that in ordinary cases it may be right to say that a master cannot be held responsible for the criminal acts of his servants, because the servant is a separate person from the master, but a company can only commit offences by its servants. On behalf of the appellant, it was argued that though in Rex v. Cory Brothers and Co., [1927] 1 KB 810 (KB), it was held that an indictment will not lie against a company either for felony or a misdemeanour involving personal violence, yet, as decided in Triplex Safety Glass Co. Ltd. v. Lancegaye Safety Glass (1934) Ltd., [1939] 2 All ER 613 (CA), it was possible to prove against a limited company all the constituent elements of the crime of publishing a defamatory libel, the vital ingredients of which is a malicious state of mind. Based upon this decision, it was contended by the counsel for the appellant therein that if a company can be guilty of malice, it must be assumed to have that kind of fictitious mind which can be affected with malice and that equally so, it can have knowledge and an intent to deceive and so can be held to be guilty of the offences charged in that case. On the contrary the counsel for the respondent-company contended that a company can only be held to be responsible in respect of the intention or knowledge of its agents, the officers of the company, to the same extent as a private individual is responsible for the acts of his agent, and, therefore, that the respondent-company cannot be held to form the intention or to have the knowledge necessary to constitute the offences charged. Viscount Caldecote C.J., after having referred to the case law, observed that though a company cannot be found guilty of certain criminal offences, such as treason or other offences for which it is provided that death or imprisonment is the only punishment, yet a company can be convicted for certain offences. The learned judge goes on giving certain offences, in respect of which a corporation can be convicted. The learned judge referred to the decision in Chuter v. Freeth & Pocock Ltd., [1911] 2 KB 832 (KB), where Lord Alverstone C.J. held that the corporation can give a warranty through its agents, and through its agents it can believe or not believe, as the case may be, that the statements in the warranty are true and that similarly in regard to actions which, in the case of an individual, would involve an inquiry into a state of mind, such as fraud, libel or malicious prosecution, a corporation will be liable in all those actions. The learned judge agreed in toto with the principle laid down in that decision. After having referred to the decisions in Pearks, Gwnston & Tee Ltd. v. Ward, [1902] 2 KB 1, 11, 12 (KB), Mousell Bros. Ltd. v. London and North Western Rail Co., [1917] 2 KB 836 (KB), Pharmaceutical Society v. London and Provincial Supply Association, [1880] 5 App Cas 857 (HL) and Law Society v. United Service Bureau Ltd., [1934] 1 KB 348, 349 (KB), the learned judge observed as follows:

44. In Rex v. I. C. R. Haulage Ltd., [1944] 1 All ER 691 (CCA), it was held that an indictment for a common law conspiracy to defraud will lie against a limited company. In that case, the question arose whether a limited company can be indicted for conspiracy to defraud. The appellant-company therein was charged along with others at Maidstone Assizes with a common law conspiracy to defraud. Before the hearing of the charge, objection was taken on behalf of the company that an indictment alleging a common law conspiracy to defraud would not lie against a limited company. The Commissioner of Assizes refused to quash the indictment and the jury convicted the company who were ordered to pay a fine. The company appealed. In the course of the arguments in that case, it was conceded by counsel for the company that a limited company can be indicted for some criminal offences, while the counsel for the Crown also conceded that there were some criminal offences for which a limited company cannot be indicted. So, the controversy centered round the question where and on what principle the line must be drawn and on which side of the line an indictment such as the company's liability to a common law conspiracy to defraud falls. Counsel for the company contended that the true principle was that an indictment against a limited company for any offence involving as an essential ingredient "mens rea" in the restricted sense of a dishonest or criminal mind, must be bad joy the reason that a company, not being a natural person, cannot have a mind honest or otherwise and that, consequently, though in certain circumstances, it is civilly liable for the fraud of its officers, agents or servants, it is immune from criminal process. Counsel for the Crown contended that a limited company, like any other entity recognized by the law, can as a general rule be indicted for its criminal acts which from the very necessity of the case must be performed by human agency and which in given circumstances become the acts of the company, and that for this purpose there was no distinction between an intention or other function of the mind and any other form of activity. It was further contended by the Crown that the offences for which a limited company cannot be indicted are exceptions to the general rule arising from the limitations which must inevitably attach to an artificial entity, such as a company. Included in these exceptions are the cases in which, from its very nature, the offence cannot be committed by a corporation, as, for example, perjury, an offence which cannot be vicariously committed, or bigamy, an offence which a limited company, not being a natural person, cannot commit vicariously or otherwise. A further exception, but for a different reason, comprises offences of which murder is an example, where the only punishment the court can impose is corporal, the basis on which this exception rests being that the court will not stultify itself by embarking on a trial in which, if a verdict of guilt is returned, no effective order by way of sentence can be made. Stable J., who pronounced the judgment on behalf of the court stated :

49. In the decision in State of Maharashtra v. Syndicate Transport Co. (P.) Ltd., it was held that a corporate body ought to be indictable for criminal acts or omissions of its directors, or authorised agents or servants, whether they involve mens rea or not, provided they have acted or have purported to act under authority of the corporate body or in pursuance of the aims or objects of the corporate body and that the question whether a corporate body should not be liable for criminal action resulting from the acts of some individuals must depend on the nature of the offence disclosed by the allegations in the complaint or in the charge sheet, the relative position of the officer or agent vis-a-vis the corporate body and the other relevant facts and circumstances which could show that the corporate body, as such, meant or intended to commit that act. The learned judge has elaborately discussed both the English law and the Indian law on the subject. In paragraph 17 of the judgment (page 200) following the English and Indian cases, the learned judge has observed that a company cannot be indictable for offences like bigamy, perjury, rape, etc., which can only be committed by a human individual or for offences punishable with imprisonment or corporal punishment.

61. A company cannot be guilty of any criminal offence which, by their very nature, can only be committed by natural persons (such as bigamy), nor of those which cannot be committed vicariously (such as perjury, bigamy, rape, homicide, etc.). A company cannot be indicted for a crime where the only punishment is death or imprisonment. A company may be guilty both of statutory and common law offences (of course in exceptional cases in respect of common law offences), even though the latter involves mens rea. A Corporation can be indicted for contempt and libel.