2008 (1) ALD (CRL.) 48 (AP)
IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD
IN THE HIGH COURT OF JUDICATURE, A.P. AT HYD. HILAL NAZKI, J.
Hindustan Lever Ltd., Mumbai — Appellant
Vs.
State — Respondent
Crl. P No.3573 of 2003
Decided on : September 14, 2007
Standards of Weights and Measures Act, 1976 – Section 39, 63, 72, 74 – Negotiable Instruments Act, 1881 – Section 141 – Companies Act – Section 175 – Drugs and Cosmetics Act, 1940 – Section 34 –Dishonour of Cheque – Quash of Criminal proceedings - Petitioner is A-1, who has filed this quash petition mainly on the ground that offence under Section 63 of Act carries a punishment of fine which may extend for first offence and for second or subsequent offences, imprisonment, which may extend to five years – Learned Counsel for petitioner contends that this is first offence committed by petitioner and Court is bared from taking cognizance of offence after expiry of limitation period of six months – He contends that complaint discloses that offence was alleged to have been committed but cognizance by Magistrate was taken as such it was beyond period of limitation that cognizance was taken which was illegal – Section 468 lays down period of limitation for the purpose of taking cognizance and for the purpose of that section, the period of limitation has to be determined with reference to offence question whether the date of taking of cognizance by the Magistrate or the date on which the complaint is filed has to be taken for computing period of limitation had raised some controversies in this Court and one of the Judges of this Court has disagreed with view expressed earlier in Criminal Petition that date of taking cognizance was relevant for computation of the limitation present case was referred to a Division Bench and Division Bench, by its order reported – Held, Requires some mention, as question framed by Supreme Court was answered 1 affirmative and it was held that 1anaging Director or Joint Managing director would be admittedly in charge of 1e Company and responsible to company for conduct of its business therefore by virtue of office they hold Managing Director or Joint Managing director these persons would be in charge f and responsible conduct of its business of Company and they would covered under Section 141 of the Negotiable Instruments Act – In present case it is merely stated in complaint lat petitioner was Chairman of Company and Chairman is not equivalent to a Managing Director in terms of Company Law, therefore, I do not think Court should have taken cognizance against petitioner. Even in sub-section (2) of Section 74 of Companies Act, there is no reference to Chairman of Company unless Articles of Company provide otherwise members personally present in the meeting of Board shall elect one of them as Chairman and he would be chairing meetings of Board. As such, there are no administrative powers with Chairman and therefore, unless it is alleged that Chairman was in charge of and was responsible to Company for the conduct of business of Company at time the offence was committed he could not be prosecuted merely because he was Chairman of Company – Application is allowed.
2. Petitioner is the A-1, who has filed this quash petition mainly on the ground that the offence under Section 63 of the Act carries a punishment of fine which may extend to Rs.5,000/- for the first offence and for second or subsequent offences, imprisonment, which may extend to five years. Learned Counsel for petitioner contends that this is the first offence committed by the petitioner and the Court is bared from taking cognizance of the offence after the expiry of the limitation period of six months. He contends that the complaint discloses that the offence was alleged to have been committed on 22.5.2002, but the cognizance by the Magistrate was taken on 10.12.2002, as such, it was beyond the period of limitation that cognizance was taken, which was illegal.
3. Section 468 Cr.P.C. lays down the period of limitation for the purpose of taking cognizance and for the purpose of that section, the period of limitation has to be determined with reference to the offence. The question whether the date of taking of cognizance by the Magistrate or the date on which the complaint is filed has to be taken for computing the period of limitation, had raised some controversies in this Court and one of the Judges of this Court has disagreed with the view expressed earlier in Criminal Petition No.3572 of 2003 that the date of taking cognizance was relevant for computation of the limitation. The present case was referred to a Division Bench, and the Division Bench, by its order dated 31st of January 2007 reported in 2007 (1) ALD (Crl.) 438 (AP) Hindustan Lever Ltd., Mumbai v. State, held-
"Whenever a complaint is filed by a public servant authorized under Section 72 of the Act, the date of filing the complaint will be deemed to be the date of taking cognizance of the offence and not the date when the process is ordered for computing limitation under Section 468 Cr.P.C."
4. Following this judgment, one cannot but come to a conclusion that the present complaint was filed within time, as the offence had come to light on 22.5.2002 and the complaint had been filed on 21.11.2002 i.e. within six months and therefore, the complaint cannot be quashed on this ground.
5. The second ground is that in terms of Section 74 of the Act, if an offence committed under the Act was 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 proceeded against and punished accordingly. But, it is nowhere pleaded in the complaint that A-I was in charge of and was responsible for the conduct of the business of the Company and in the absence of such an allegation, the complaint could have not been taken cognizance of as against A-1.
6. The question came directly before the Supreme Court in S.MS. Pharmaceuticals Ltd. v. Neeta Bhalla, 2005 (2) ALD (Cri.) 595 (SC) = 2005 (8) SCC 89, when it was considering the import of Sections 141 and 138 of the Negotiable Instruments Act, 1881. The Supreme Court, at the outset, framed the following three questions for consideration-
"(a) Whether for purposes of Section 141 of the Negotiable Instruments Act, 1881, it is sufficient if the substance of the allegation read as a whole fulfil the requirements of the said section and it is not necessary to specifically state in the complaint that the person accused was in charge of, or responsible for, the conduct of the business of the Company.
(b) Whether a Director of a Company would be deemed to be in charge
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