HIGH COURT OF CALCUTTA
DEBABRATA MOOKHERJEE
B. N. MEHROTRA - Appellant
Versus
STATE - Respondent
Criminal Revn. 811 Of 1955
Decided On : DECEMBER 15, 1955
INDIAN BOILERS ACT - SECTION 6 (C) AND 23 - PROSECUTION OF DIRECTORS OF A COMPANY - DIRECTORS NOT LIABLE FOR OFFENCE COMMITTED BY THE COMPANY - COMPANY TO BE PROSECUTED.
Fact of the Case:
Directors of a company were prosecuted for using a boiler without a certificate in contravention of Section 6 (c) read with Section 23 of the Indian Boilers Act. The company was a public limited company registered under the Indian Companies Act.
Finding of the Court:
The court held that the directors could not be prosecuted for the offence committed by the company. The company was the real offender and should have been prosecuted.
Issues: Whether the directors of a company can be prosecuted for an offence committed by the company.
Ratio Decidendi: The court held that the directors could not be prosecuted because: * The definition of "owner" in the Indian Boilers Act includes any person using a boiler as agent of the owner or any person using a boiler which he has hired or obtained on loan from the owner. * There was no allegation that the directors were using the boiler in question as agents of the owner or that they had hired or obtained it on loan. * The company was the real offender and should have been prosecuted.
Final Decision: The court made the rule absolute and quashed the proceedings pending against the directors. It directed the authorities concerned to consider prosecuting the company for the alleged offence.
( 1 ) THIS Rule was issued to show cause why certain proceedings pending against these petitioners under Section 6 (c) read with Section 23, Indian Boilers Act should not be quashed or why such other or further orders should not be made as to this Court might seem fit and proper.
( 2 ) THE proceedings are pending in the Court of a Magistrate, First Class, Barrackpore, against these four petitioners who are the directors of Messrs. Bharat Woollen Mills Ltd. , Mill No. 2 at 4, Nillganj Road, Belgharia, 24 Parganas.
( 3 ) IT appears that on 22-3-1954 the Chief Inspector of Boilers, West Bengal, wrote a letter of complaint asking for prosecution of the directors of Messrs. Bharat Woollen Mills Ltd. , a public limited company registered under the Indian Companies Act. The letter alleged that as a result of inspection of Mill No. 2 at 4, Nillganj Road on 24-12-1953 it was discovered that a particular boiler located In the mill was actually steaming without a certificate having been taken out for it authorising the use of the boiler. In these circumstances a prayer was made that a prosecution might be started against the petitioners for infringement of the provisions of the Indian Boilers Act.
( 4 ) ON receiving the complaint, the letter was forwarded by the District Magistrate to the Sub-Divisional Officer, Barrackpore, for disposal, according to law; and the latter made an order on 9-4-1954 in which it was stated that he had taken cognizance of the offence under Section 23, Indian Boilers Act against the petitioners and summoned them to take their trial. The petitioners then moved this Court and! obtained the present Rule.
( 5 ) SECTION 6, Indian Boilers Act contains several clauses of which Clause (c) alone is material to the present case. That section says that 'save as otherwise expressly provided in this Act, no-owner of a boiler shall use the boiler or permit it to be used unless a certificate or provisional order authorising the use of the boiler is for the time being in force under this Act'. Section 23 of the Act punishes illegal use of boilers and provides that a contravention by any owner of the boiler in the shape of its use without a certificate or provisional order will be punishable with fine which may extend to five hundred rupees, and in the case of a continuing offence, with an additional fine which may extend to one hundred rupees for each day after the first day in regard to which he is convicted of having persisted in the offence. Section 2 (d) of the Act defines "owner" as including any person using a boiler as agent of the owner thereof and any person using a boiler which he has hired or obtained on loan from the owner thereof. The word "owner" has, therefore, received a special meaning, under the definition which I have just read. It would include a person actually using a boiler or even an agent of the owner as much as any person who is using a boiler obtained on hire or on loan.
( 6 ) MR. Dutt has contended that the present prosecution against these four petitioners who are said to be the directors of the company cannot be maintained in law. It is argued that a company registered under the Indian Companies Act is a person and that being so the person affected by the contravention would be the company itself. The Indian General Clauses Act (Act 10 of 1897) which is applicable to this case defines "person" in Section 3 (42), The word includes any company or association or body of individuals whether incorporated or not. I think there is considerable substance in this contention. It is indeed difficult to see what led the prosecuting authorities to prefer a complaint charging these petitioners described as directors with having committed offence under Section 23 read with Section 6 (c) Indian Boilers Act. Surely a director or all the directors do not constitute the company. The company is a legal entity which can very well be prosecuted if it is alleged that it is guilty of acts w
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