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2023 Supreme(Kar) 1109

IN THE HIGH COURT OF KARNATAKA
Hemant Chandangoudar, J.
Naveen Kumar V. – Appellant
Versus
State of Karnataka – Respondent
Writ Petition No. 15100 of 2023 (GM-RES),Writ Petition No. 15155 of 2023 (GM-RES)
Decided On : 31-08-2023

Advocates appeared:
Milash Arrol Noronha, Advocate, M.R.Patil, Advocate

Vicarious liability under the Essential Commodities Act necessitates the arraignment of the manufacturer as an accused; absence of such leads to quashing of proceedings against retailers or sales executives.

Headnote:

FERTILIZER - ESSENTIAL COMMODITIES ACT - The court addressed the prosecution of petitioners under the Fertilizer Control Order and the Essential Commodities Act, emphasizing that without the manufacturer being arraigned as an accused, the petitioners could not be held vicariously liable. The court interpreted Section 10 of the Essential Commodities Act, concluding that the absence of the manufacturer in the proceedings rendered the continuation of the case an abuse of process.

Fact of the Case:

The petitioners were accused of offenses under the Fertilizer Control Order and the Essential Commodities Act after a sample of fertilizer from a retailer was found to be substandard. A complaint was filed, leading to the issuance of summons against the petitioners.

Finding of the Court:

The court found that the manufacturer of the fertilizer was not included as an accused party, which is crucial for establishing vicarious liability under the Essential Commodities Act. The court determined that the petitioners could not be held guilty without the manufacturer being present in the proceedings.

Issues: Whether the petitioners can be held vicariously liable for the offenses under the Essential Commodities Act when the manufacturer is not arraigned as an accused.

Ratio Decidendi: The court held that under Section 10 of the Essential Commodities Act, vicarious liability requires the presence of the company as an accused. Since the manufacturer was not included, the petitioners could not be prosecuted, leading to the conclusion that the proceedings were an abuse of process.

Final Decision: The writ petitions were allowed, and the criminal proceedings against the petitioners were quashed.

JUDGMENT

1. The petitioners are sought to be prosecuted for the offence punishable under Ss. 19(a)(b) of Fertilizer (Inorganic, Organic, or Mixed)(Control) Order, 1985 (for short 'Control Order, 1985') and Ss. 3 and 7 of the Essential Commodities Act.

2. The respondent filed a private complaint under Sec. 200 of Cr.PC alleging that, a sample of fertilizer collected from the premises of accused No.1, who is the retailer, was sent to the Test Analyst as specified under Schedule-I of the Control Order, 1985. The Test Analyst, after examination, sent a report stating that, the sample of fertilizer collected from the premises of accused No.1 is of substandard. The accused No.2 is the Sales Executive of the manufacturer. The learned Magistrate, after perusing the complaint, took the cognizance of the aforesaid offences and issued summons. Hence, these petitions.

3. The learned counsel for the petitioners submits that the manufacture of the subject fertilizer having not been arraigned as an accused, the petitioner cannot be held vicarious guilty along with the manufacturer as specified under Sec. 10 of the Essential Commodities Act.

4. The learned High Court Government Pleader for the respondent submits that the complaint discloses the commission of the aforesaid offences and the learned Magistrate has rightly taken the cognizance and the same does not warrant any interference.

5. Considered the submissions of the learned counsel for the parties.

6. Sec. 2 of the Control Order, 1985 specifies that the Act means the Essential Commodities Act, 1955 and the provisions of the Act are made applicable, and the fertilizer is declared as an essential commodity in the Schedule-I to the Control Order, 1985.

7. Sec. 10 of the Essential Commodities Act, 1955 deals with offences by companies, and specifies that, if any person contravening an order made under Sec. 3 is a company, every person who, at the time the contravention 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 contravention. In the instant case, the company which has manufactured the subject fertilizer has not been arraigned as an accused. Hence, the company having not been arraigned as an accused, the petitioner - accused No.1 who is the retailer and the accused No.2 who is the Sales Executive of the manufacturer cannot be held vicarious guilty along with the company as specified under Sec. 10 of the Essential Commodities Act. Therefore, the continuation of the criminal proceeding will be an abuse of process of law. Accordingly, I pass the following:

    ORDER

i) Writ petitions are allowed.

ii) The impugned proceeding in CC No.1110/2022 pending on the file of the learned Additional Civil Judge and JMFC Arakalagudu, Hassan, insofar as it relates to the petitioner in both the petitions, is hereby quashed.

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