Case: Tamil Nadu Electricity Board Vs. M/S.Rasipuram Textile (P) Ltd

(1) of section 24; or (b) lays, or causes to be laid, or connects up any works for the purpose of communicating with any other works belonging to a licensee, (***); or (c) maliciously injures any meter referred to in section 26,sub-section(1) or any meter, indicator or apparatus referred to in section 26,sub-section (7) or willfully or fraudulently alters the index of any such meter, indicator or apparatus, or prevents any such meter, indicator or apparatus from duly registering; or (d) improperly uses the energy of a licensee. [shall be punishable with imprisonment for a term which may extend to three years, or with fine which may extend to five thousand rupees, or with both], and , in the case of a continuing offence, with a daily fine which may extend to [fifty] rupees and[ if it is proved that any artificial means exists] for making such connection as is referred to in clause(a) (or such re-connection as is referred to in clause(aa)] or such communication as is referred to in clause(b) or for causing such alteration or prevention as is referred to in clause (c) or for facilitating such improper use as is referred to in clause (d) (and that) the meter, indicator or apparatus is under the custody or control of the consumer, whether it is his property or not [ it shall be presumed, until the contrary is proved] [that such connection, reconnection, communication], alteration, prevention or improper use, as the case may be, has been knowingly and willfully caused by such consumer." 12. Section 49A which was inserted by Act 32 of 1959 provides for offence by companies. It reads as under: "49A Offence by companies- (1) If the person committing an offence under this Act is 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: PROVIDED that nothing contained in this sub-section shall render any such person liable to any punishment, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence. (2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director or manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation- For the purposes of this section- (a) "company" means any body corporate and includes a firm or other association of individuals; and (b) "director" in relation to a firm, means a partner in the firm." 13. In terms of the aforesaid provision, therefore, it was obligatory on the part of the complainant not only to make requisite averments in the complaint petition but also to prove that any of the Directors who had been prosecuted for alleged commission of the aforementioned offence was incharge of and was otherwise responsible for the conduct or the affairs of the Company. 14. We have noticed hereinbefore that how the learned trial Judge has dealt with the entire aspect. Learned trial Judge has misconstrued and misinterpreted the provisions of Section 49A of the Act. 15. In terms of Sub-section (1) of Section 49A, it is for the complainant to prove that the Director of the Company at the time when the theft was committed was in charge of and/or was responsible for the conduct of its business. Only in the event such an averment is made and sufficient and cogent evidence is brought on record to prove the said allegations, the proviso appended to Section 49 A would be attracted; meaning thereby only in the event it is proved that a Director or a Group of Directors of the Company were in charge of and/or were responsible for the conduct of the business of the company, the burden would shift on the accused to establish the ingredients contained in the proviso appended to Section 49A of the Act. 16 Learned Additional Sessions Judge as well as the High Court, in our opinion, therefore, were right in holding that in the absence of any averment made in the complaint petition as also in the absence of any evidence brought on record by the complainant to satisfy the requirements of Section 49A of the Act, the respondents could not have been convicted. 17 This aspect of the matter has been considered by a series of decisions of this Court including S.M.S. Pharmaceuticals Ltd. Vs. Neeta Bhalla & Anr. - (2005) 8 SCC 89. Following the said decision this Court in K.Srikanth Singh Vs. North East Securities Ltd. and Anr. -(2007) 12 SCC 788 in a case arising under Section 138 of the Negotiable Instrument Act, held as under: " 4. It is not in dispute that for showing a vicarious liability of a Director of a company upon the complaint it is incumbent to plead that the accused was responsible to the company for the conduct of the business of the company. No such allegation having been made in the complaint petition, in our opinion, the High Court was not correct in passing the impugned judgment. The allegation contained in the complaint petition was that all the accused Directors, participated in the negotiations for obtaining financial help for Accused 1, which in our opinion, would not give rise to an inference that the appellant was responsible for day-today affairs of the company....." See: Saroj Kumar Poddar Vs. State (NCT of Delhi)- (2007)3 SCC 693 Average Advertising Pvt. Ltd. Vs. State, Govt. of N.C.T. & Ors. - (2007) 5 SCC 54. 18. For the reasons aforementioned, there

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]We have noticed hereinbefore that how the learned trial Judge has dealt with the entire aspect. Learned trial Judge has misconstrued and misinterpreted the provisions of Section 49A of the ActIn terms of Sub-section (1) of Section 49A, it is for the complainant to prove that the Director of the Company at the time when the theft was committed was in charge of and/or was responsible for the conduct of its business. Only in the event such an averment is made and sufficient and cogent evidence is brought on record to prove the said allegations, the proviso appended to Section 49 A would be attracted; meaning thereby only in the event it is proved that a Director or a Group of Directors of the Company were in charge of and/or were responsible for the conduct of the business of the company, the burden would shift on the accused to establish the ingredients contained in the proviso appended to Section 49A of the ActLearned Additional Sessions Judge as well as the High Court, in our opinion, therefore, were right in holding that in the absence of any averment made in the complaint petition as also in the absence of any evidence brought on record by the complainant to satisfy the requirements of Section 49A of the Act, the respondents could not have been convicted.