IMPORTANT POINT
The court ruled that a Managing Director cannot be held vicariously liable for a company's actions without specific statutory provisions.

JUDGMENT :

FARJAND ALI, J.

1. These criminal misc. petitions filed under Section 482 of Cr.P.C. on behalf of the petitioners seeking quashing of the FIR No. 103/2009 dated 19.05.2009 registered at Outpost Bikaner Anti Corruption Bureau, Jaipur for the offences under Sections 13(1)(D) and 13(2) of Prevention of Corruption Act, 1988 and Sections 465, 466, 467, 468, 471 and 120-B of IPC.

2. Heard leaned counsel for the parties and perused the material as made available to this Court.

3. The instant criminal misc. petitions are pending before this Court since 2009 and the investigation in the impugned FIR could not be completed because of the operation of interim order passed by a Coordinate Bench of this Court in S.B. Civil Writ Petition No. 2360/2010, Goverdhan Singh & Ors. Vs. State of Rajasthan & Ors.

4. At the outset, learned GA cum AAG-II Mr. N.K. Gurjar has submitted a detailed factual report dated 16.11.2024 along with a copy of the Death Certificate of petitioner - D.S. Rathore sent by the Additional Superintendent of Police, Anti Corruption Bureau, Bikaner, as per which, he has passed away on 15.08.2022. Thus, a criminal action dies with a person as it is taken from the legal maxim ‘actio personalis cum moritur persona’ therefore, there remains nothing to adjudicate with regard to him.

5. There are allegations that the then Branch Manager of the Oriental Bank of Commerce, Bikaner, situated in a school premises, along with the other employees of that bank, were handing gloves with the school employees and that is why, they were always willing to facilitate legal or illegal work of school employees for the interest of the school. There are allegations that accused petitioners viz. Laxmi Narayan Meena, Ashwani Kaushik, Kamlesh Kumar and D.S. Rathore (since died) were receiving bribe for accommodating the work of school.

6. There is neither any record nor any allegation regarding involvement of petitioner viz. K.N. Prithviraj, who happened to be the then Chairman and Managing Director of Oriental Bank of Commerce, who used to sit at the Head Office, Nagpur. There is no whisper regarding any culpability on his part or his indulgence in the day to day affairs related to the Oriental Bank of Commerce, Branch Bikaner situated in school premises.

7. In criminal law, unless there is specific and express provision fastening vicarious liability, as it is in the statute books of Negotiable Instrument Act, Companies Act, Provident Funds Act and etc. no person can be held vicarious liable for a criminal act not committed by him/her.

8. Reliance can be placed on the judgment dated 15.02.2008 rendered by Hon’ble the Supreme Court in the case of S.K. Alagh Vs. State of Uttar Pradesh & Ors. (2008) 5 SCC 662 [Criminal Appeal 317 of 2008]. For ready reference the said judgment is reproduced hereunder:

“1. Leave granted.

2. M/s Akash Traders was an area wholesale dealer of Britannia Industries Limited (the Company) for Azamgarh, U.P. Dealership of Respondent 2 was terminated by the said Company. It was earlier informed that goods will be delivered only upon receipt of demand drafts issued by it. The complainant sent two demand drafts for a sum of Rs. 18,000 and Rs. 1,50,000 for supply of goods on 14-9-2000 despite the fact that the dealership had been terminated earlier.

3. The said demand drafts were sent to the appellant through the local sales incharge of the Company. It is stated that the complainant refused to take the same back.

4. A new area wholesaler for Azamgarh was appointed by the Company.

5. A demand was made by the complainant to deliver goods by a letter dated 24-9-2000 stating that the Company owes him a sum of Rs. 1,00,000. The stand of the Company that his dealership had been terminated was reiterated by a letter dated 25-9-2000.

6. Ashok Kumar Aggarwal, purported to be the proprietor of the firm M/s Akash Traders, filed a complaint petition in the Court of Chief Judicial Magistrate, Azamgarh against the appellant herein for commission of