IMPORTANT POINT
An employee cannot be held criminally liable for a firm's offenses without evidence of their direct involvement or responsibility in the conduct of business.

ORDER :

The petitioner is the sixth accused in C.C.No.161/2012 and C.C.No.148/2013 on the files of the Chief Judicial Magistrate Court, Ernakulam, and the seventh accused in C.C.No.1477/2014 on the files of the Judicial First Class Magistrate Court, Ramankari. The offence alleged against the petitioner in C.C.No.161/2012 are under Sections 403, 420 and 120B read with Section 34 I.P.C and that of in C.C.No.148/2013 are under Sections 403 and 420 I.P.C read with Section 34 I.P.C and also under Sections 2(c), 3, 4 and 5 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978. The offence alleged in C.C.No.1477/2014 on the files of the Judicial First Class Magistrate Court, Ramankary are under Sections 409, 418, 420, 120(A) and 120(B) read with Section 34 I.P.C and Sections 2(c), 3, 4 and 5 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978. In C.C.No.148/2013, there are altogether nine accused, and in the other two cases, there are eight accused.

2. The prosecution case is that, with the common intention to commit cheating, the accused had conspired together and gave the false promise to the depositors that if they invest in the partnership firm by name ‘LIS’ conducted by the first accused as its Managing Trustee and accused Nos.2 and 3 as partners, the amount so deposited would be doubled within a year and that the investments so made by the depositors would be returned to them after the prescribed period as double the amount, and thereafter, did not honour the above commitment and failed to return the amount so deposited by the depositors. The petitioner was said to be working as Manager in the above establishment conducted by the first accused as Managing Trustee and accused Nos.2 and 3 as partners. The total amount embezzled in the crime involved in C.C.No.148/2013 is Rs.52,37,375/-, and that of in C.C.No.161/2012 and C.C.No.1477/2014 are respectively Rs.4,63,000/- and Rs.8,93,125/-.

3. In the present petitions, the petitioner would contend that he is totally innocent and that he has been falsely implicated in this case. It is further contended by the petitioner that he was only an employee of the establishment conducted by accused Nos.1 to 3 and that he cannot be held liable for the offences alleged in these cases. For the above reason, the petitioner seeks to quash the proceedings in these cases.

4. Heard the learned counsel for the petitioner and the learned Public Prosecutor representing the State of Kerala.

5. Admittedly, the petitioner was working as Manager in the establishment by name ‘LIS’ which was run by the first accused as Managing Trustee and accused Nos.2 and 3 as the partners. The fourth accused is stated to be the Chairman of the above establishment, and the 8th accused, the partner of a sister concern of that partnership firm. It is pertinent to note that, apart from a general and superficial allegation that the employees at the office of the establishment by name ‘LIS’ had also compelled the depositors to invest in the financial business being conducted by the above firm, there is absolutely no specific indictment as against the petitioner herein. There is no case for any of the depositors that the petitioner herein was entrusted with any amount, or that the petitioner herein had collected any amount from the depositors after fraudulently and dishonestly inducing them to believe that their amounts would be doubled, if they are making investments in the firm conducted by accused Nos.1 to 3. Going by the provisions contained in Section 6 of the Prize Chits and Money Circulation (Banning) Act, 1978, if an employee of a firm or other association of individuals has to be held liable for the offence committed by the firm, it has to be shown that he was in-charge of, and was responsible to the firm for the conduct of business of such firm. It is further provided thereunder that if a Manager, Secretary or other Officer of any such company or firm has to be attributed personally with the cr