SB Cr. Misc. Petition No.84/2003 M/s. Hwizal Laboratory Pvt Ltd & Ors. Vs. State { 1 } S.B. Cr. Misc. Petition NO.84/2003 M/s. Hwizal Laboratory Pvt Ltd., & Ors. vs State of Rajasthan DATE OF ORDER : - 7.7.2008 HON'BLE MR. PRAKASH TATIA, J. Mr.RK Charan, for the petitioner. Mr. JPS Choudhary, PP. <><><> A criminal complaint was filed under Section 18(a)1, 17B(d), 17A(f), 16(1)(a) and Section 24B of the Drugs and Cosmetics Act, 1940 (hereinafter referred to as the Act of 1940) as well as under Section 37(c) and 27(b) of the Act of 1940. In the complaint M/s. Nihal Medical Store, the firm where the sample was taken and two partners accused no.2 and 3 alognwith manufacturer M/s. Hwizal Laboratory Pvt. Ltd. Alongwith its Directors accused no. 5 to 7 were added as accused. In the complaint it is specifically mentioned that accused no.2 and 3 are responsible for carrying out the day to day business and activities of accused no.1 company and, therefore, they are liable to suffer the consequence of SB Cr. Misc. Petition No.84/2003 M/s. Hwizal Laboratory Pvt Ltd & Ors. Vs. State { 2 } committing offence. So far as accused no.4 to 7 are concerned, the accused no.4 is the manufacturer company and accused no.5 to 7 are the Directors of the accused no.4 company. For accused no.5 to 7 in the complaint it is specifically pleaded that they have impleaded as accused only because of the reason that they are Directors of the accused no.4 company. Section 34 of the Act clearly provides a provision how to deal with the matter where there are allegation of committing offence by the company. As per Section 34(1) where an offence under 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. The proviso further makes it clear that even if a person is proceeded against because of the reason that there is allegation that he was incharge and was responsible to the company for conduct of business even then he can show that the SB Cr. Misc. Petition No.84/2003 M/s. Hwizal Laboratory Pvt Ltd & Ors. Vs. State { 3 } offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence. The matter was considered by the Hon'ble Supreme Court in the case of GL Gupta Vs. D.N. Mehta reported in AIR 1997 SC 28 wherein the words “a person incahrge and responsible for the conduct of the affairs of a company” have been considered. In the said judgment, the Hon'ble Apex Court observed that director who may be a party to the policy been followed by a company and yet not be incharge of the business of the company. The Hon'ble Supreme Court further held that “manager who usually is in charge of the business but not in over-all-charge.” In view of the above reasons and in view of the aforesaid provisions of law there must be allegation against the person against whom prosecuting is launched that they are incharge and responsible for act of the company and particularly of commission of offence. In the present case, admittedly, there is no allegation against the petitioners that they were responsible and incahrge for act of the company accused no.4. SB Cr. Misc. Petition No.84/2003 M/s. Hwizal Laboratory Pvt Ltd & Ors. Vs. State { 4 } In view of the above reasons, the criminal proceedings against petitioners cannot proceed. Consequently,this misc petition is allowed and the prosecution against the petitioners is quashed. (PRAKASH TATIA), J. c.p.Goyal/-