Case Note & Summary
The petitioner, Afzal Abdul Khalek Ahmed, a director of M/s Recon Oil Industries Ltd., filed a criminal writ petition challenging an order dated 9th May 2003 passed by the Judicial Magistrate, First Class, Kannad, rejecting his application (Exh.27) to drop criminal proceedings against him in R.C.C. No.20/1996. The prosecution was under the Prevention of Food Adulteration Act, 1954. The petitioner argued that the company had already nominated a person under Section 17(2) of the Act to be in charge of and responsible for the conduct of its business, and that nominee was arrayed as accused No.3. Therefore, the petitioner, as a director, could not be prosecuted merely because the company had committed an offence. The court examined Section 17(1) of the Act, which provides that where an offence is committed by a company, the person nominated under Section 17(2) (if any) shall be deemed guilty, and only if no person is nominated, every person in charge of the business at the time of the offence shall be liable. The court held that since a nominee was already declared and prosecuted, the petitioner could not be indicted. The impugned order was quashed, and the proceedings against the petitioner were dropped.
Headnote
A) Criminal Law - Prevention of Food Adulteration - Offences by Companies - Section 17(1)(a)(i) and (ii) of Prevention of Food Adulteration Act, 1954 - Where a company has nominated a person under Section 17(2) to be in charge of and responsible for the conduct of its business, only that nominee and the company can be prosecuted for an offence under the Act; directors cannot be prosecuted merely by virtue of their position. The court held that the petitioner, a director, could not be indicted when a nominee was already declared and arrayed as accused No.3. (Paras 1-4)
Issue of Consideration
Whether a director of a company can be prosecuted for an offence under the Prevention of Food Adulteration Act, 1954 when the company has already nominated a person under Section 17(2) to be in charge of and responsible for the conduct of its business.
Final Decision
The impugned order dated 9th May 2003 is quashed and set aside. The criminal proceedings against the petitioner in R.C.C. No.20/1996 are dropped.
Law Points
- Section 17 of Prevention of Food Adulteration Act
- 1954 provides that where a company has nominated a person to be in charge of and responsible for the conduct of its business
- only that nominee and the company can be prosecuted for offences under the Act
- directors cannot be vicariously liable if a nominee is declared.
Case Details
2013 LawText (BOM) (06) 8
Criminal Writ Petition No.63 of 2005
Mr D.S. Bharuka for petitioner, Mrs V.A. Shinde, A.P.P. for respondents
The State of Maharashtra & Shri S.V. Mulay, Food Inspector
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Nature of Litigation
Criminal writ petition challenging order rejecting application to drop proceedings under Prevention of Food Adulteration Act, 1954.
Remedy Sought
Petitioner sought quashing of order dated 9th May 2003 and dropping of criminal proceedings against him.
Filing Reason
Petitioner, a director, was prosecuted for an offence under the Prevention of Food Adulteration Act, 1954 despite the company having nominated a person under Section 17(2) to be in charge of its business.
Previous Decisions
The Judicial Magistrate, First Class, Kannad rejected the petitioner's application (Exh.27) to drop proceedings on 9th May 2003.
Issues
Whether a director can be prosecuted under the Prevention of Food Adulteration Act, 1954 when a nominee has been declared under Section 17(2).
Submissions/Arguments
Petitioner argued that since a nominee was declared and arrayed as accused No.3, the director could not be prosecuted merely because he is a director.
Respondents opposed the application, but the judgment does not detail their arguments.
Ratio Decidendi
Under Section 17(1) of the Prevention of Food Adulteration Act, 1954, where a company has nominated a person under Section 17(2) to be in charge of and responsible for the conduct of its business, only that nominee and the company can be prosecuted for an offence under the Act. Directors cannot be prosecuted merely by virtue of their position if a nominee is declared.
Judgment Excerpts
Section 17 (1) of the Food Adulteration Act, 1954 reads thus : '17. Offences by companies – (1) Where an offence under this Act has been committed by a company - (a)(i) the person, if any, who has been nominated under sub-section 92) to be in charge of, and responsible to, the company for the conduct of the business of the company (hereafter in this section referred to as the person responsible), or (ii) 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 company; and (b) the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly;'
Procedural History
The petitioner filed an application (Exh.27) before the Judicial Magistrate, First Class, Kannad in R.C.C. No.20/1996 to drop proceedings against him. The Magistrate rejected the application on 9th May 2003. The petitioner then filed Criminal Writ Petition No.63 of 2005 before the Bombay High Court, Bench at Aurangabad, which was allowed on 19th June 2013.
Acts & Sections
- Prevention of Food Adulteration Act, 1954: 17(1), 17(2)
