IN THE HIGH COURT OF JHARKHAND AT RANCHI
SANJAY KUMAR DWIVEDI, J.
Roshan Lal Goyal, son of Shri Balraj Kumar Goyal – Appellant
Versus
The State of Jharkhand – Respondent
Cr.M.P. No. 2580 of 2016
Decided on : 28-04-2022
Negotiable Instruments Act, 1881 - Section 141 - Drugs and Cosmetics Act, 1940 - Sections 27(D),18(a)(i),34 - Offences by companies – Quashing the entire criminal proceeding - Standard quality, or is misbranded, adulterated or spurious- Held, it appears that vicarious liability on a person is prescribed for an offence committed under the Act by a company arises if at material time he was Incharge and was also responsible for the day to day affairs of the company - In the entire complaint, there is no averment as to what are the role played by these petitioners who happened to be Directors of the said company - If the company is responsible, the law is well settled that the company is required to be made accused in the case and in the case in hand the company has not been made an accused and the case of the petitioners is covered in the light of the judgment of Hon’ble Supreme Court in the cases (supra) – Order accordingly
JUDGMENT :
1. This petition has been filed for quashing the entire criminal proceeding as well as the order dated 13.12.2013 passed by the learned Chief Judicial Magistrate at Chaibasa in connection with Complaint Case being C/7-86 of 2013 whereby learned court has been pleased to find a prima facie case under sections 27(D), 18(a)(i) of the Drugs and Cosmetics Act, 1940 against the petitioners and accordingly took cognizance of the said offence and issued summons to the petitioners to face trial, pending in the court learned Chief Judicial Magistrate, at Chaibasa.
2. The complaint has been filed by the Drug Inspector alleging therein that on 28.02.2014 in presence of Child Development and Project Officer, Khuntipani, Store of M/s Aushadhi Bhandar, ICDS Project, Khuntipani, West Singhbhum was inspected and sample of Paracetamol syrup I.P, B.No.ML12-017 was collected for its examination. The sample was sent to Govt. Analyst, State Medicine Test Laboratory, Namkum, Ranchi, where the chemical examination of the said sample was done and the report dated 22.3.2013 was received and the sample was found not of standard quality as the oral liquid was not homogenous, which duly informed to the CDPO, Khuntipani, Singhbhum West and she was requested to make available the sale register of the said medicine and she was further requested to stop the sale/distribution/use of the said medicine. On 10.05.2013, the representative of the medicine manufacturer company had received a part of the sealed sample. M/s HLL Life Care Limited, Bekar Bandh, Gupteshwar Complex, Dhanbad on 31.03.2013 had provided the required document to the complainant. The manufacturing and distribution of the sub-standard medicine is hazardous and cognizable offence and therefore the present case has been lodged against the accused persons.
3. Mr. Mazumdar, the learned counsel for the petitioners submits that lodging of the complaint, the learned CJM, Chaibasa has taken cognizance under sections 27(D), 18(a)(i) of the Drugs and Cosmetics Act, 1940 against the petitioners. He further submits that the petitioners are the Directors of M/s Maiden Pharmaceuticals Limited. He submits that there is no averments on the allegation in the complaint against the petitioners who are the Directors of the said company/firm. He submits that in view of section 34 of the Drugs and Cosmetics Act, 1940 (hereinafter referred to be as the Act.), the persons who are Incharge and looking after the day to day affairs of the company is only required to be prosecuted. He submits that there is no averments in this regard. In the complaint there is no averments that the petitioners are looking after the day to day affairs of the company. To buttress this argument he relied in the case of State of Haryana v. Brij Lal Mittal and Others, (1998) 5 SCC 343 and relied on paragraph no. 8 of the said judgment which is quoted hereinbelow:
“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 any such person liable to any punishment provided in this Act if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.”
It is thus seen that the vicarious liability of a person for being prosecuted for an offence committed under the Act by a company arises if at the mat
Dinesh B.Patel and Others v. State of Gujarat and Another
State of Haryana v. Brij Lal Mittal and Others
Vicarious liability under the Drugs and Cosmetics Act, 1940 arises if the person was in charge and responsible for the day-to-day affairs of the company at the time of the offence, and the company mu....
The central legal point established in the judgment is the requirement for specific averments about the role of individuals in charge of a company's affairs and the need for the company to be made an....
Vicarious liability under the Drugs and Cosmetics Act requires the person to be in charge and responsible for the day-to-day affairs of the company, and specific allegations against a director regard....
Vicarious liability under Drugs Act Section 34 requires specific averments that directors were in charge of and responsible for day-to-day business and supervision; mere directorship insufficient, bu....
Vicarious liability under the Drugs and Cosmetics Act requires specific averments in the complaint to establish that individuals were in charge of and responsible for the conduct of the business at t....
Directors cannot be held liable for a company's criminal acts without specific allegations of their involvement; mere directorship is insufficient for establishing vicarious liability.
The main legal point established in the judgment is that for making a director of a company liable for offences committed by the company under the Drugs & Cosmetics Act, 1940, there must be specific ....
Directors of a company not involved in drug manufacturing cannot be held liable under the Drugs and Cosmetics Act absent specific evidence of their responsibility for the conduct of business.
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