The prosecution must prove the accused's responsibility for the company's business conduct under S.16(1) of the Prevention of Food Adulteration Act for them to be held liable.

1. This appeal is by the Food Inspector of the Calicut Corporation against the order of acquittal of accused 2 and 3 who along with the first accused were prosecuted in Calendar Case 221 of 1963 for sale of adulterated milk fruits, an offence punishable under S.16 (1) (a) read with S.7 of the Prevention of Food Adulteration Act (shortly stated the Act).

2. On the morning of 315 1963, pw.1 the Corporation Food Inspector visited the Ujay Ice Fruit Works, Gujarathy Street, Calicut and purchased 30 milk fruits from the first accused paying its price. They were duly sampled and sent for analysis. The report of the public analyst Ext. P-4 showed that the sample was adulterated as it contained non-permitted coaltar dye. When the accused were questioned the first accused admitted the sale but put forward the plea of warranty. Learned Magistrate negatived the plea of warranty and found the first accused guilty of the offence charged and sentenced him to pay a fine of Rs. 100. He has not filed any appeal.

3. On the ground that accused 2 and 3 constituted a company and as the prosecution had failed to prove that they were in charge of and were responsible to the company for the conduct of the business of the company they were acquitted. The correctness of this finding is challenged in this appeal. Learned counsel for the corporation contends that S.17 of the Act has no application, that this was only a case where accused 2 and 3 are joint proprietors, that the licence stands in their names and they were conducting the business and the first accused was only their agent or servant and that both the master and the servant could be held liable.

4. The first question to be decided is whether accused 2 and 3 could be said to be partners of the firm and would come within the purview of S.17 of the Act. The explanation to S.17 says, company means any body corporate and includes a firm or other association of individuals. Learned counsel for the respondents contend that accused 2 and 3 constitute a firm, that they are an association of individuals who were conducting the trade and as such they would satisfy the description of the term'company'. The mere fact that the licence stands in the name of accused 2 and 3 and they are shown in the complaint as owners or proprietors would not show that they do not form a company. In the General Clauses Act, 1897 under S.3 (42) 'person' shall include any company or association or body of individuals whether incorporated or not. In the Act special provision is made if the offence is committed by an association of persons.

5. Learned counsel has referred me to certain decisions of the Supreme Court dealing with the question as to what is the meaning of the word 'association of individuals' in the Income Tax Act. Their Lordships have followed the decision in Commissioner of Income tax v. Laxmi Das Devi Das (AIR. 1938 Bom. 41), where Beaumont, C. J., laid down the test as follows:

"In my opinion, the only limit to be imposed on the words 'other association of individuals' is such as naturally follows from the fact that the words appear in an Act imposing a tax on income, profits and gains, so that the association must be one which produces income, profits or gains. It seems to me that an association of two or more persons for acquisition of property which is to be managed for the purpose of producing income, profits or gains fall within the words 'other association of individuals' in S.3 and under S.9 of the Act, the association of individuals is the owner of the property and as such is assessable."

6. This view has been followed in the decision in Commr of Income Tax, Bombay v. Indira Balkrishna (AIR. 1960 S. C. 1172); Mohammed Noorulla v. Commr, of Income Tax, Madras (AIR. 1961 S. C. 1043); and Commr, of Income Tax, Poona v. Buldana District Main Cloth Importers Group (AIR. 1961 S. C. 1261).

7. A specific question was asked to pw.1 the Food Inspector whether Ujay Ice Fruit Works is not a partnership conc