SCR.A/2079/2011 13/ 13 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CRIMINAL APPLICATION No. 2079 of 2011 [ENTITY] - THRO' NITINKUMAR J GANDHI- FOOD INSPECTOR - Applicant(s) Versus [ENTITY] & 1 - Respondent(s) Appearance : Mr. [ENTITY] Addl. PUBLIC PROSECUTOR for Applicant(s) : 1, MR [ENTITY] for Respondent(s) : 1 - 2. CORAM : HONOURABLE MR.JUSTICE J.C.UPADHYAYA Date : 10/01/2012 ORAL ORDER
1. Heard Mr [ENTITY] learned Additional Public Prosecutor for the petitioner State of Gujarat and Mr [ENTITY] learned advocate for the respondents.
2. The challenge in this application is to the order dated 4th April 2011 passed by learned Additional Sessions Judge, Morbi in [CASE NUMBER] whereby the order passed by the learned Additional Chief Judicial Magistrate, Morbi dated 14th December 2010 came to be set aside and two respondents herein who were original accused No. 4 and 7 were ordered to be discharged pursuant to [SECTION] of the [ACT].
3. As per the prosecution case Senior Food Inspector Mr. [ENTITY] visited the shop of original accused No. 8 namely M/s Beverages and at that time one of the partners namely original accused No.1 [ENTITY] was found present in the shop. The Food Inspector collected samples from packed drinking water and upon being analysis made by the Chemical analyser the same was found to be adulterated. The concerned Food Inspector then obtained sanction order from local health authority to prosecute the firm along with its seven partners for commission of offence punishable under [SECTION] of the [ACT] (for short the "Act").
4. All the eight accused persons being summoned by the concerned magistrate pursuant to the [CASE NUMBER] filed by the concerned Food Inspector against eight accused persons including the firm, the complainant Food Inspector adduced the evidence as contemplated under [SECTION] of the [ACT]. After the said evidence was over the two respondents herein, who are original accused Nos 4 and 6 in the said criminal case, filed an application at Exh. 77 seeking their discharge as contemplated under [SECTION] of the [ACT]. Learned Chief Judicial Magistrate, Morbi vide order dated 14th December 2010 dismissed the said application holding that the questions whether the original accused Nos 4 and 6 were sleeping partners or were working partners, are questions of evidence and therefore without recording any evidence the same cannot be decided. Accordingly the discharge application came to be dismissed. It seems that the original accused Nos. 4 and 7 who are respondents herein challenged the said order by preferring [CASE NUMBER] in the Court of learned Additional Sessions Judge, Morbi. The learned Additional Sessions Judge vide order dated 4th April 2011 allowed the said revision application and set aside the order of the trial court dated 14th December 2010 and directed that the original accused Nos. 4 and 7 shall be discharged from this case under [SECTION] of the [ACT]. In the order, the learned Additional Sessions Judge took into consideration mainly the partnership deed exh. 45 which came to be produced and proved by the Food Inspector himself and came to the conclusion that pursuant to the partnership deed itself it becomes clear that the original accused No. 4 and 7 were sleeping partners. Hence, the petitioners State challenged the said order passed by learned Additional Sessions Judge, Morbi in this petition filed under [SECTION] of the [ACT].
5. Mr [ENTITY] learned Additional Public Prosecutor for the petitioner submitted that in the first place pursuant to the orders passed by the Sessions Court it is clear that the Sessions Court completely ignored vital provisions contained in the Act and more particularly [SECTION] of the Act. Mr [ENTITY] learned Additional Public Prosecutor submitted that as per the scheme of [SECTION] of the Act the partnership firm was required to fill in a nomination form stating name or names of the partner or partners who shall be in charge and responsible to the company/ firm for the conduct of the business of the firm. It is submitted that in the instant case admittedly there was no nomination as contemplated under [SECTION] of the Act. Mr [ENTITY] learned Additional Public Prosecutor therefore submitted that in the instant case, [SECTION] shall apply and it is submitted that in case 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 firm is liable. Mr [ENTITY] learned Additional Public Prosecutor drew my attention to a communication dated 1st June 2006 from his file whereby it is stated that so far as the instant partnership firm is concerned there was no nomination as contemplated under [SECTION] of the Act. It is further submitted that the bare perusal of the averments made by the Food Inspector in his private complaint would suggest that L.H.O accorded the sanction to the Food Inspector to prosecute not only the partnership firm but even its seven partners including the original accused Nos. 4 and 7. Mr [ENTITY] therefore submitted that the Sessions Court not only failed to consider the relevant provisions contained in [SECTION] of the Act but unnecessarily placed much reliance upon the partnership deed exh. 45 and came to the conclusion that original accused No. 4 and 7 were sleeping partners.
5.1 Mr [ENTITY] learned Additional Public Prosecutor in support of his submissions relied upon the case of [PRECEDENT]. He also relied upon the case of [PRECEDENT]. Mr [ENTITY] learned Additional Public Prosecutor therefore, submitted that the impugned order passed by the Sessions Court is perverse and is contrary to law and exceeded its jurisdiction and therefore the same is required to be interfered with under [SECTION] of the [ACT].
6. Mr [ENTITY] learned advocate for the respondents (original accused nos 4 and 7) fully supported the order passed by the concerned Sessions Court whereby the respondents came to be discharged under [SECTION] of the [ACT].
7. Mr. [ENTITY] learned advocate for the respondents submitted that in the instant case there is no dispute that along with the partnership firm, the seven accused persons came to be arraigned in the private complaint by the complainant Food Inspector. It is further submitted that the perusal of the complaint would suggest that out of the seven partners only original accused No. 1 [ENTITY] was found present in the shop at the time when Food Inspector collected the disputed sample. Mr [ENTITY] further submitted that after all the accused persons came to be summoned by the trial court and after they remained present before the Court, the trial court recorded evidence as contemplated under [SECTION] of the [ACT] and at that time the complainant Food Inspector stepped into the witness box and proved relevant documents including the partnership deed Exh. 45. Mr [ENTITY] learned advocate for the respondents tendered for perusal the copy of partnership deed which shall be retained on record. My attention was drawn to para 7 in the said partnership deed wherein it is stated that out of the seven partners of the firm only four partners, named in para 7 shall be the active partners and the working partners. It is therefore submitted that two lady accused namely the respondents herein were never earmarked as active or working partners. Mr [ENTITY] learned advocate for the respondents therefore submitted that by the document produced by the prosecution itself it is clear that not only there was no nomination as contemplated under [SECTION] of the Act but the respondents who came to be discharged by the Sessions Court were not working partners but were sleeping partners.
7.1 Mr. [ENTITY] learned advocate for the respondents in support of the submissions relied upon the case of [PRECEDENT]. He also relied upon in the case of [PRECEDENT]. Reliance was also placed upon the case of [PRECEDENT].
He also relied upon the case of R. Banerjee & Ors vs. H.D Dubey & Ors (supra) which was also relied upon on behalf of the petitioner. Mr [ENTITY] learned advocate for the respondent also relied upon the case of [PRECEDENT].
8. Mr [ENTITY] learned advocate for the respondent therefore submitted that the order passed by the Sessions Court cannot be termed as order passed without jurisdiction or perverse or that the Sessions Court exceeded its power so that the same can be interfered with [SECTION] of the [ACT]. It is therefore, submitted that the petition may be dismissed.
9. Considering the order dated 24th August 2011 passed in this matter, notice for final disposal was issued and under such circumstances pursuant to the said order the matter was taken up for final disposal. There is no dispute that the Food Inspector filed the private complaint against eight accused including the partnership firm and its seven partners. There is no dispute that as per the partnership deed exh. 45 there were in all seven partners. Considering the complaint filed by the Food Inspector, it further transpires that at the time when he visited the shop of the firm, original accused No. 1 [ENTITY], one of the partners of the firm, was present and in his presence disputed samples were collected pursuant to the complaint. It further transpires that LHO accorded the sanction to prosecute not only the partnership firm but all its seven partners including the respondents herein. There is also no dispute that there is absence of any nomination as contemplated under [SECTION] of the Act. In that view of the matter there is also no dispute that in the instant case, in absence of nomination provisions of Sub clause (II) of Subsection (a) of subsection (1) of [SECTION] of the Act shall apply. As per the said provision, in case where no persons 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; shall be deemed to be guilty of the offence. Explanation (a) attached to [SECTION] suggests that "Company" means any body corporate and includes a firm or other association of individuals.
10. Thus in the instant case, in absence of any nomination, every partner in the firm shall be deemed guilty and shall be liable to be prosecuted who at the time of the offence was in charge of and was responsible to the firm for the conduct of the business of the firm. The scheme contained under [SECTION] of the Act has been elaborately dealt with by Hon'ble Apex court in the case of of R.Banerjee V. H.D Dubey and Ors (supra). Para 4 in the said decision runs as under :
"4. It is clear from the plain reading of [SECTION] that where an offence under the Act is alleged to have been committed by a company, where the company has nominated any person to be in charge of, and responsible to, the company for the conduct of its business that person will be liable tobe proceeded against and punished for the commission of the offence. Where, however, no person has been so nominated, every person who at the time of the commission of the offence was in charge of, and responsible to, the company for the conduct of its business shall be proceeded against and punished for the said crime. Even in such cases the proviso offers a defence, in that, the accused can prove his innocence by showing that the offence was committed without his knowledge and notwithstanding the exercise of due diligence to prevent it. The scheme of [SECTION] is, therefore, clear that the cases where a person has been nominated under [SECTION] is, therefore, clear that the cases where a person has been nominated under [SECTION], he alone can be proceeded against and punished for the crime in question. It is only where no such person has been nominated that every person who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of its business can be proceeded against and punished. The proviso, however, lays down an exception that any such person proceeded against shall not be liable to be punished if he proves that the offence was committed without his knowledge and that he had exercised all due diligence to prevent the commission thereof. [SECTION] empowers the company to authorise any of its Directors or Managers to exercise all such powers and take all such steps as may be necessary or expedient to prevent the commission by the company of any offence under the Act. It further empowers the company to give notice to the Local (Health) Authority in the prescribed form that it has nominated a Director or Manager as the person responsible to the company for the conduct of its business. This has to be done with the written consent of the nominated Director or Manager. Where a company has different establishments or branches or units, different persons may be nominated in relation to the different establishments/branches/units and the person so nominated shall be deemed to be the person responsible in respect of such establishment, branch or unit. [SECTION] overrides the preceding sub-sections and posits that where an offence has been committed by a company and it is proved that the offence was 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, other than the one nominated, such Director, Manager, Secretary or other officer shall also be deemed guilty and be liable to be proceeded against and punished for the same. This sub-section, therefore, makes it clear that notwithstanding the nomination under [SECTION], any Director,Manager, Secretary or other officer of the company,other than the nominated person, can be proceeded against and punished if it is shown that the offence was committed with his consent or connivance or negligence. It is crystal clear from the scheme of [SECTION] that where a company has committed an offence under the Act, the person nominated under sub section(2) to be in charge of, and responsible to, the company for the conduct of its business shall be proceeded against unless it is shown that the offence was committed with the consent/connivance/ negligence of any other Director, Manager, Secretary or Officer of the company in which case the said person can also be proceeded against and punished for the commission of the said offence. It is only where no person has been nominated under [SECTION] that every person, who at the time of the commission of the offence was in charge of and was responsible to the company for the conduct of its business can be proceeded against and punished under the law."
11. Thus at this stage what is required to be considered is as to whether, prima facie, at the time of commission of offence the respondents herein were in charge of and were responsible to the firm for the conduct of the business of the firm or not. There is no dispute that LHO accorded sanction to prosecute not only the partnership firm but all its seven partners. It appears that since, there was absence of nomination, LHO accorded sanction to prosecute all the partners including the firm. However, the fact is clear that before the respondents herein filed the application before the trial court for discharge under [SECTION] of the [ACT], the trial court recorded the evidence of the Food Inspector who produced and proved certain documentary evidence as provided under [SECTION] of the [ACT]. During course of his evidence the Food Inspector produced and proved partnership deed Exh. 45. Considering the said deed it transpires that the partnership firm consisted of seven partners including the two respondents herein. In para 7 of the said deed it has been clearly stated that out of the seven partners, the four partners named therein shall be the active and working partners. Now if para 7 is considered it clearly transpires that the two respondent partners are not named as working or active partners in the partnership deed. Considering the partnership deed it further transpires that those working partners were provided more share of the firm. It is pertinent to note that this document came to be produced and proved by the Food Inspector himself, during the course of the evidence recorded under [SECTION] of the [ACT]. This document therefore, clearly suggests that the two respondents cannot be said to be in charge of and were responsible to the firm for the conduct of the business of the firm at the time when the offence was committed.
12. In the initial order passed by the trial court the trial court rejected the plea of the respondents herein for discharge solely on the ground that whether the respondents were working partners or sleeping partners, is a question of evidence which cannot be decided at the stage of discharge. In the revision, concerned the Sessions Court relied upon the partnership deed exh 45 and came to the conclusion that the document produced by the prosecution itself clearly suggests that out of the seven partners, only four partners, named in para 7 in the document were earmarked as working or active partners, the fact becomes very clear that the two respondents herein were not earmarked as working or active partners who were responsible for day to day affairs of the firm. Thus, the concerned Sessions Court therefore, observed that when the documentary evidence is clear, there was no question for any oral evidence to be led in future and ultimately the order of the trial court was set aside and discharged the respondents under [SECTION] of the [ACT].
13. Mr [ENTITY] learned Additional Public Prosecutor for the petitioner relied upon the case of [PRECEDENT] (supra).
The perusal of the said decision would suggest that the concerned Food Inspector in the complaint itself had given complete details of the role played by the respondents in the said matter as well as the extend of their liability. In the complaint itself it has been clearly stated that Chairman, Managing Director and the Directors of the Mill were incharge of and responsible for the conduct of its day to day business. It has been further observed that there were clear averments made in the complaint regarding the active role played by all the respondents. In the instant case, the facts are otherwise. In the instant case though in the complaint it is stated that LHO accorded sanction to prosecute all the partners including the firm but the facts are clear that there was absence of any nomination as contemplated under [SECTION] of the Act and that the document tendered in the evidence by the Food Inspector himself, namely the partnership deed suggests that the two respondents herein were not working or active partners in the partnership firm.
14. In the case of [PRECEDENT] (supra), the Hon'ble Apex Court in para 15 of the decision observed that so far as the manager was concerned, by his post itself he was responsible for his day to day affairs of the company but so far as the Directors were concerned, prima facie there was nothing that they can be made vicariously liable. It is further pertinent to note that in the said decision Hon'ble Apex Court took into consideration, [SECTION] of the [ACT] and in para 19 in the said decision it has been observed that the prosecution can at any stage produced evidence which satisfies the Court that the other accused or those who have not been arrayed as accused against whom the proceedings have been quashed, have also committed the offence, and the Court can take cognisance against them and try them along with the other accused. Therefore, in the instant case on the basis of the evidence which may be led before the trial court if the complicity of the accused is to be revealed the court may use the provision contained under [SECTION] of the [ACT]. That remedy still remains open.
15. In the above view of the matter this Court is of the opinion that the order dated 4th April 2011 passed by the learned Additional Sessions Judge,Morbi in allowing the [CASE NUMBER] discharging the respondents herein under [SECTION] of the [ACT] cannot be said to be an order having been passed without any jurisdiction or that the concerned Sessions Court exceeded its power or that the same can be termed as perverse, so that the same is required to be interfered with under [SECTION] of the [ACT]. Resultantly this application is devoid of any merits and deserves dismissal.
16. For the forgoing reasons, these applications stands dismissed.
([ENTITY],J.) mary