Case Note & Summary
The applicant, Mr. Gautam Hari Singhania, the Chairman and Managing Director of Raymond Limited, filed a criminal application under Section 482 of the Code of Criminal Procedure, 1973, challenging the order dated 19.05.2014 passed by the Judicial Magistrate, First Class, Court No.4, Nagpur, issuing process against him for offences under Sections 18(1), 49, and 36(1) of the Legal Metrology Act, 2009 read with Rules 18(1) and 24 of the Legal Metrology (Packaged Commodities) Rules, 2011. The complaint was filed by Shri S.N. Saraf, Inspector of Legal Metrology, Nagpur, alleging that during a visit to Reliance Trends Ltd., Nagpur, a cardboard package of fabric of Raymond Limited was found without the required declarations. The complaint named the company, the applicant as Managing Director, and other directors. The applicant sought quashing of the process on the ground that the complaint lacked specific allegations that he was in charge of and responsible for the conduct of the business of the company at the time of the offence, as required under Section 36(1) of the Act. The court analyzed Section 36(1) and held that for vicarious liability to attach, the complaint must contain specific averments that the accused was in charge of and responsible for the conduct of the business. The court found that the complaint merely stated that the applicant was the Managing Director without any further allegations regarding his role. Consequently, the court held that the process issued was an abuse of the process of law and liable to be quashed. The court allowed the application and quashed the process against the applicant.
Headnote
A) Criminal Law - Vicarious Liability - Requirement of Specific Allegations - Legal Metrology Act, 2009, Section 36(1) - The court held that for a director or managing director to be vicariously liable for an offence under the Act, the complaint must contain specific averments that the accused was in charge of and responsible for the conduct of the business of the company at the time of the offence. Mere designation as Managing Director is insufficient to attract liability. (Paras 7-9) B) Criminal Procedure - Quashing of Process - Abuse of Process - Code of Criminal Procedure, 1973, Section 482 - The court held that where the complaint lacks necessary averments to make out a prima facie case against the accused, the process issued is an abuse of the process of law and liable to be quashed. (Paras 10-11) C) Legal Metrology - Offences by Companies - Liability of Directors - Legal Metrology Act, 2009, Section 36(1) - The court interpreted Section 36(1) and held that it creates a deeming fiction of guilt only when the accused was in charge of and responsible for the conduct of the business. The complaint must explicitly state such facts. (Paras 7-9)
Issue of Consideration
Whether the process issued against the Managing Director of a company for offences under the Legal Metrology Act, 2009 can be sustained in the absence of specific allegations regarding his role and responsibility in the conduct of the business of the company.
Final Decision
The court allowed the application and quashed the order dated 19.05.2014 issuing process against the applicant. The process against the applicant was set aside.
Law Points
- vicarious liability
- strict construction of penal provisions
- requirement of specific averments
- quashing of criminal process
- Legal Metrology Act
- 2009
