Important Point:
The legal position is comparable in many respects to the, development in Roman Law. So far as charitable endowment is concerned Roman Law as later developed recognised two kinds of juristic persons. One was a corporation or aggregate of persons which owed its juristic personality to State sanction. A private person might make over property by way of gift or legacy to a corporation already in existence and might at the same time prescribe the particular purpose for which the property was to be employed e.g. feeding the poor or giving relief to the poor distressed. The recipient corporate would be in a position of a trustee and would be legally bound to spend the funds for the particular purpose. The other alternative was for the donor to create an institution or foundation himself. This would be a new juristic person which depended for its origin upon nothing else but the will of the founder provided it was directed to a charitable purpose. The foundation would be the owner of the dedicated property in the eye of law and the administrators would be in the position of trustees bound to carry out the object of the foundation.

J.B. Pardiwala, J.

1. Rule returnable forthwith. Ms. Thakore, the learned Additional Public Prosecutor waives service of notice of rule for and on behalf of the respondents.

2. By this application under Section 482 of the Code of Criminal Procedure, 1973, the applicants-original accused persons seek to invoke the inherent powers of this Court, praying for quashing of the proceedings of the Criminal Case No. 789 of 2016 pending in the Court of the learned 2nd Additional Chief Judicial Magistrate, Dahod arising from a complaint lodged by the respondent No. 2 herein for the offence punishable under Sections 18(c) read with 27 of the Drugs and Cosmetics Act, 1940.

3. The case of the complainant may be summarised as under:

3.1 The applicants before me are the "Trustees" of a Public Charitable Trust, running in the name of "Daweso Welfare Trust." It is engaged in the business of promoting educational, social and sports activities as well as extending medical services to the people hailing from poor and downtrodden class of the society. The Trust was registered under the Bombay Public Trust Act and its registration number is "E. 2554 PAN." It is alleged in the complaint that the Trust is running a medical store. For the purpose of running a medical store, the Trust is obliged in law to hold a licence issued by the competent authority under the provisions of the Act, 1940. It is alleged that the Trust, without any licence, is running a medical shop in contravention of the provisions of the Drugs and Cosmetics Act, 1940. The applicants being the Trustees of the Trust are vicariously liable for the offence committed by the Trust, which, according to the complainant, could be termed as an association of individuals for the purpose of Section 34 of the Act, 1940.

4. Mr. Modi, the learned counsel appearing for the applicants vehemently submitted that the shop is being run and managed by a "Manager" appointed by the Trust. The applicants, being the Trustees of a Public Charitable Trust, would not constitute an association of individuals for the purpose of Section 34 of the Act, and therefore, no vicarious liability can be fastened upon the Trustees.

5. Ms. Thakore, the learned Additional Public Prosecutor appearing for the State would submit that for the purpose of Section 34 of the Act, 1940, the Trustees of a Public Charitable Trust registered under the Bombay Public Trust Act, would fall within the ambit of an association of individuals, and therefore, they can be fastened with the vicarious liability under Section 34 of the Act, 1940.

6. Having heard the learned counsel appearing for the parties and having considered the materials on record, the only question that falls for my consideration is whether a Public Charitable Trust is a juristic person and company in terms of Section 34 of the Drugs and Cosmetics Act, 1940.

7. Before adverting to the rival submissions canvassed on either side, I must look into certain provisions of the Act, 1940.

8. Section 18 of the Act, 1940 reads as under:

"18. Prohibition of manufacture and sale of certain drugs - From such date as may be fixed by the State Government by notification in the Official Gazette in this behalf, no person shall himself or by any other person on his behalf:-

(a) manufacture for sale or for distribution, or sell, or stock or exhibit or offer for sale:-

(i) any drug which is not of a standard quality, or is misbranded, adulterated or spurious;

(ii) any cosmetic which is not of a standard quality or is misbranded or spurious;

(iii) any patent or proprietary medicine, unless there is displayed in the prescribed manner on the label or container thereof (the true formula or list of active ingredients contained in it together with the quantities thereof);

(iv) any drug which by means of any statement, design or device accompanying it or by any other means, purports or claims (to prevent, cure or mitigate) any such disease or ailment, or to have any such other effect as may be prescribed;

(v