Directors cannot be held vicariously liable for a company's offence without specific allegations and the company's identification as an offender.

JUDGMENT :

NEENA BANSAL KRISHNA, J.

1. The Petition under Section 482 of the Code of Criminal Procedure, 1973 (hereinafter referred to as „ Cr.P.C .‟) has been filed on behalf of the Petitioner/Amar Tea Pvt. Ltd. for quashing of Summoning Order dated 31.07.2010 in C.C. No. 2593-2594/2010 under Section 39 and 63 of the Standards of Weights and Measures Act, 1976 (hereinafter referred to as „SWM Act‟ 1976) and all proceedings emanating therefrom.

2. It is submitted that the Petitioner is a Private Limited Company registered under Companies Act having its Registered Office at Mumbai, having its business in the field of manufacturing and marketing of Tea and allied Products under the trademark “Society Tea”.

3. It is submitted that as per the Respondent No. 2, an inspection was conducted on the premises of M/s Jain Sales Co., 254/6C, Bhola Natha Nagar, Shahdara, Delhi-110032 on 29.03.2010 and a packet of Tea under the brand of Amar Tea weighing 250 grams, was seized. It was found that no customer care number was mentioned and the date of packaging was hand written as 3/10, on the packet. It was further alleged that the name of the Company of the Petitioner, M/s Amar Tea Pvt. Ltd., was indicated on the packet as “Packaged and Marketed by”.

4. Thereafter, Notice dated 25.05.2010 was served upon M/s Jain Agencies, through its Proprietor, Mr. Naveen Jain with the allegations that the customer care number was not indicated and that the packaging date was hand written. The proprietor pleaded guilty and the matter was accordingly disposed of.

5. Thereafter, Complaint dated nil was served upon “All Directors, M/s Amar Tea Pvt. Ltd.” on which the cognizance was taken and summons were issued to the Petitioner, by the learned Metropolitan Magistrate vide Order dated 31.07.2020.

6. The Order on Summoning has been challenged on the grounds that there was no link evidence whatsoever to show that this packet taken from the premises of Jain Sales Company, was ever supplied by the Petitioner.

7. Secondly, the Notice has been issued to all the Directors of Petitioner‟s Company, however, Section 74 of SWM Act, 1976, provides that where the offence is committed by the Company, every person who at the time of offence, was in-charge of and was responsible to the Company for the conduct of business as well as the Company, shall be deemed guilty of the offence and be liable to be proceeded against and punished accordingly. It is claimed that unless the name of the Company was disclosed, the Directors cannot be held vicariously liable by virtue of Section 74 of SWM Act, 1976. Therefore, without making the Company as a party and without there being any averment that all the Directors were in- charge and responsible to the conduct of business of the Petitioner’s Company, the Summoning Order suffers from patent illegality and is not sustainable under law.

8. Arguments heard and the record perused.

9. The Complaint had been filed under Section 39 and 63 of SWM Act, 1976, essentially on the ground that the date of packaging on the packet was indicated in pen.

10. First and foremost, in inspection was conducted on 29.03.2010 on the premises of M/s Jain Sales Co., Shahdara, Delhi, a Complaint under Section 33/51 of 85 Act 39/63 of Std/WRM Act, 1976 against M/s Jain Agencies through its proprietor, Mr. Naveen Jain, was filed to which Mr. Naveen Jain pleaded guilty and a fine of Rs.3,000/- was imposed upon him vide Order dated 11.06.2010.

11. This is the second Notice in regard to the same Inspection to “All Directors, M/s Amar Tea Pvt. Ltd.” was served for offences under Section 33/63 of the SWM Act, 1976.

12. The first ground of challenge to the Complaint is that it is addressed to All Directors without impleading the Company as a party. Section 74 of SWM Act, 1976 specifically provides that where an offence is committed by a Company, every person who at the time of the offence was in-charge of and responsible to the Company for the conduct of business, shall be deemed guilt