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2022 Supreme(J&K) 324

IN THE HIGH COURT OF JAMMU AND KASHMIR AND LADAKH AT SRINAGAR
SANJAY DHAR, J.
Ashish Dhamija Manorma Dhamija – Petitioner
Versus
UT of J&K – Respondent
CRM (M) Nos. 14 of 2021, 303 of 2019
Decided On : 04-08-2022

Advocates:
Advocate Appeared:
For the Petitioners: Varut Kumar Gupta, Pankaj Kumar Sharma.
For the Respondent: Sheikh Mushtaq.

Headnote:

Drugs and Cosmetics Act - Prosecution of Partners - Section 18(a)(i), 17(B)(d), 27(c), 36-AB, 124B and Schedule V S. No. 3 - The court discussed the provisions of Section 34 of the Drugs and Cosmetics Act, 1940, which extends the concept of vicarious liability to the persons responsible for the conduct of business of the company in a case where the offence has been committed by the company. The court highlighted the conditions for vicarious liability and emphasized the necessity of impleading the company or partnership firm as an accused for prosecuting its partners under the Act. The court referred to relevant case laws to support its interpretation of the legal provisions.

Fact of the Case:

The petitioners challenged a complaint filed by the respondent Drugs Control Officer alleging offences under the Drugs and Cosmetics Act, 1940. The complaint was related to the quality of a drug and involved the petitioners who were partners of the manufacturing firm.

Finding of the Court:

The court found that the prosecution against the petitioners was not sustainable as the partnership firm was not impleaded as an accused in the complaint. Additionally, there were no allegations in the complaint to show that the petitioners were responsible for the conduct of the firm's business at the relevant time.

Issues: The main issue was whether the prosecution against the partners of a manufacturing firm could proceed without impleading the firm as an accused and without allegations showing their responsibility for the firm's business.

Ratio Decidendi: The court held that for maintaining prosecution against partners under the Drugs and Cosmetics Act, it is imperative to implead the partnership firm as an accused. The court emphasized the conditions for vicarious liability and the necessity of impleading the company or partnership firm as an accused for prosecuting its partners under the Act.

Final Decision: The court allowed both petitions and quashed the impugned complaint and the proceedings against the petitioners, stating that the continuation of the criminal proceedings would be an abuse of process of law.

JUDGMENT :

SANJAY DHAR, J.

1. By this common judgment, two petitions, CRM (M) No. 14/2021 filed by petitioner Ashish Dhamija and CRM (M) No. 303/2019 field by petitioner Manorma Dhamija, are proposed to be disposed of. Through the medium of these petitions, the petitioners have challenged complaint filed by respondent Drugs Control Officer alleging commission of offences under section 18(a)(i) read with Section 17(B)(d), 27(c), 36-AB, 124B and Schedule V S. No. 3 of the Drugs and Cosmetics Act, 1940 and the rules made thereunder.

2. The record shows that the respondent Drugs Control Officer has lodged the impugned complaint against the petitioners and co-accused before the Court of Chief Judicial Magistrate, Shopian. As per the complaint, on 23rd January, 2018, respondent Drugs Control Officer inspected the premises of co-accused, Shahnawaz Ahmad Khanday, who is stated to be the proprietor of Bismillah Medicate, Ringward, Keller, Shopian, and sample of the drug Biocenac - P.B. No. ADT-02-1725 was collected from his shop. The said sample, upon analysis by the Government Analyst, was found to be of not of standard quality. During investigation, it was found that the drug in question has been manufactured by M/s. Adwin Pharma Village Rampur, District Sirmaur, Himachal Pradesh. The petitioners herein happen to be the partners of the manufacturing firm. At the instance of the manufacturing firm, the sample under the direction of Chief Judicial Magistrate, Shopian, was sent to Central Drugs Laboratory, Kolkata, for re-analysis. After reanalysis of the sample, it was reported by the Central Drugs Laboratory, Kolkata, that the sample is not of standard quality. Accordingly, the prosecution was launched against the petitioners and other co-accused who happen to be the distributors and retailers of the drug in question.

3. The petitioners have raised a number of grounds to challenge the impugned complaint and the proceedings emanating therefrom but the main ground that has prevailed during the course of arguments is that the respondent/complainant has not impleaded the firm of which the petitioners happen to be the partners as an accused and that there are no allegations in the impugned complaint to show that the petitioners were the persons responsible for the conduct of day to day business of the firm in question, at the relevant time.

4. The respondent/complainant has filed his reply to the petitions. In his reply, the allegations made in the impugned complaint have been reiterated and it has been contended that the scope of jurisdiction of this Court under section 482 of the Cr.P.C. is very limited and it cannot be exercised as a matter of course. It has been further submitted that the Court should keep in mind the interests of public health while adjudicating the instant matter and that the petitioners can always raise these contentions before the trial court during the trial of the impugned complaint.

5. Heard learned counsel for the parties and perused the material on record including the trial court record.

6. As already noted, the contention of the petitioners in both these petitions is that the firm, of which they happen to be the partners, has not been impleaded as an accused in the impugned complaint and, as such, without impleadment of the firm, no prosecution can proceed against its partners.

7. In order to test the merits of the contention raised by the petitioners, it would be apt to notice the provisions contained in Section 34 of the Drugs and Cosmetics Act, 1940. It reads as under:

    34. Offences by companies:

(1) Where an offence under this Act has been committed by a company, every person who at the time the offence was committed, was in charge of and was responsible to the company for the conduct of the business of the company, as well as the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall render a

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