The judgment established the requirement for specific allegations and evidence of vicarious liability for individuals under the Contract Labour Act, emphasizing the need for a role in the incriminating act and knowledge of the offense.

JUDGMENT :

1. Heard Mr. Ajay Kumar Sah, learned counsel for the petitioners and Mrs. Priya Shrestha, learned counsel for the State.

2. This petition has been filed for quashing of entire criminal proceeding in connection with C.L. Case No. 434 of 2013 including the order taking cognizance dated 18.11.2013 passed by the learned Chief Judicial Magistrate, Dhanbad whereby cognizance has been taken against the petitioners for the offence under sections 23, 24 and 25 of the Contract Labour (Regulation & Abolition) Act, 1970, pending in the Court of learned Judicial Magistrate, Ist Class, Dhanbad.

3. Complainant has filed complaint petition alleging therein that on 05.06.2013 at 3.00 p.m., factory premises of Mc Nally Sayaji Engineering Limited, Kumardhubi, Dhanbad was inspected under the provisions of Contract Labour (Regulation & Abolition) Act, 1970 and during the course of inspection it was found that the provisions of Act and Rules of Contract Labour (Regulation & Abolition) Act, 1970 mentioned in complaint petition, have been violated.

4. It is further alleged that on inspection, the Labour Superintendent and Inspector vide Memo No. 632 dated 07.06.2013 directed the Managing Director of the Company to make payment of the balance amount by 23.06.2013 after curing the defect and further directed to ensure compliance of the same but it has not been complied then this complaint has been filed.

5. Mr. Ajay Kumar Sah, learned counsel for the petitioners submits that in the complaint petition, company has not been made accused. He further submits that the learned court has taken cognizance against the company. He further submits that the petitioners are directors of the company. He further submits that directors are not responsible for the day to day affairs of the company. He refers to section 25 of the said Act and submits that the persons who are responsible for day to day affairs of the company only can be prosecuted under the said Act.

6. Mrs. Priya Shrestha, learned counsel for the State submits that in absence of licence, project was going on that is why petitioners haves been implicated in this case.

7. The court has gone through the materials on record. In the complaint petition company has not been made accused. Petitioners are directors of the company which has been disclosed in the complaint petition. How the petitioners were looking day to day affairs of the company, has not been disclosed in the complaint petition. Moreover, even speaking that petitioners are responsible for day to day affairs of the company in the complaint petition, how the petitioners are looking day to day affairs of the company, are required to be disclosed in the complaint, which is lacking in the complaint petition. Reference may be made to the judgement in the case of S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla And Another 2005) 8 SCC 89. Para 4 and 9 of the said of the said judgment are quoted hereinbelow :

“4. In the present case, we are concerned with criminal liability on account of dishonour of a cheque. It primarily falls on the drawer company and is extended to officers of the company. The normal rule in the cases 20 involving criminal liability is against vicarious liability, that is, no one is to be held criminally liable for an act of another. This normal rule is, however, subject to exception on account of specific provision being made in the statutes extending liability to others. Section 141 of the Act is an instance of specific provision which in case an offence under Section 138 is committed by a company, extends criminal liability for dishonour of a cheque to officers of the company. Section 141 contains conditions which have to be satisfied before the liability can be extended to officers of a company. Since the provision creates criminal liability, the conditions have to be strictly complied with. The conditions are intended to ensure that a person who is sought to be made vicariously liable for an offence of which the principal accuse