Back
2024 Supreme(Online)(KER) 40114
HIGH COURT OF KERALA
K. Babu, J
THOMAS JOHN MUTHOOT – Appellant
Versus
STATE OF KERALA – Respondent
Crl.MC 6113/2024
SRI.AJITH S., MAYURI A. NAIR, MUHAMMED OWAIS
The prosecution under the Minimum Wages Act fails if the establishment is not included in the employment categories specified in the Rules, and the company must be made an accused for liability to attach.
Headnote:(A) Minimum Wages Act, 1948 - Section 22A - Kerala Minimum Wages Rules, 1958 - Rule 21A(1) - Quashing of prosecution - The petitioner, Managing Director of a financial institution, was accused of failing to maintain a wage register as per the Rules. However, the Court found the complaint insufficient, noting that the establishment did not fall under the employment categories specified in the Rules. (Paras 4-13)
(B) Corporate Liability - The liability of individuals in charge of a company arises only when the company itself is charged with an offence. The prosecution was barred as the company was not made an accused. (Paras 16-18)
Facts of the case:
The petitioner challenged the prosecution for alleged non-compliance with wage registration requirements under the Minimum Wages Act, asserting that the establishment was exempt from these rules.
Findings of Court:
The complaint was quashed due to lack of applicability of the Rules to the petitioner’s establishment and absence of the company as an accused.
Issues: Whether the establishment falls under the scheduled employment of the Minimum Wages Act and whether the prosecution can stand without the company being an accused.
Ratio Decidendi: The court ruled that the prosecution was unsustainable as the establishment did not meet the criteria set forth in the applicable statutes and the company was not included as an accused party.
Result: The prosecution was quashed.
ORDER
The petitioner, the Managing Director of Muthoot Fincorp Limited seeks to quash all further proceedings in STC.No.157/2021 on the file of the Judicial First Class Magistrate Court-II, Thaliparamba. The petitioner is alleged to have committed offence punishable under Section 22A of the Minimum Wages Act, 1948 r/w Rule 21A(1) of the Kerala Minimum Wages Rules, 1958 . The petitioner’s company is a private financial institution as provided in the schedule to the .
2. The Assistant Labour Officer, Thaliparamba (respondent No.2), the Inspector appointed under the Minimum Wages Act, 1948 (hereinafter referred to as ‘the Act’) inspected the establishment run by the petitioner on 22.9.2020 at 10.30 a.m. and found that five workers were employed there, but the petitioner failed to submit electronically or upload an IT enabled ‘Register of Employment and Wages’ in Form XIV as provided under Rule 21A(1) of the Kerala Minimum Wages Rules (hereinafter referred to as ‘the Rules’). Respondent No.2 filed a complaint under Section 22A of the Act alleging violation of Rule 21A(1) of the Rules against the petitioner. The learned Magistrate took cognizance of the offence under Section 22B of the Act.
3. I have heard the learned counsel for the petitioner and the learned Public Prosecutor.
4. The learned counsel for the petitioner submitted that the complaint does not constitute the offence as alleged. The complaint is silent as to whether the rule, violation of which is alleged, is applicable to the establishment, the employer of which is described as the petitioner. It is submitted that Rule 21A of the Rules is applicable only to the employments enumerated in the Appendix to the Rules. It is further submitted that the prosecution is barred as the company has not been made as an accused in terms of the mandate in Section 22C of the Act. The learned counsel for the petitioner relied on Dayle D’Souza v. Government of India through Deputy Chief Labour Commissioner ( AIR 2021 SC 5626 ) in support of his contentions.
5. The learned Public Prosecutor, in support of the prosecution, submitted that as the establishment run by the petitioner has been registered under the Kerala Shops and Commercial Establishments Act, 1960 , it comes under the definition of “commercial establishment” as provided in the . The learned Public Prosecutor further submitted that as per Section 17 of the Kerala Shops and Commercial Establishments Act, the entire provisions of the Act shall be made applicable to whole or any class of employees in the establishment in which the Act applies.
6. In answer to the contentions of the learned Public Prosecutor, the learned counsel for the petitioner submitted that in the Minimum Wages Act, 1948 , under which the Rules have been framed, the Legislature, has separately identified ‘employment in shops and establishments’ and ‘employment in private financial institutions’. It is submitted that while enacting the Rules, the Legislature has specifically excluded the employments other than referred to in the Appendix to the Rules. On the application of Section 17 of the Kerala Shops and Commercial Establishments Act, the learned counsel for the petitioner submitted that refers to Payment of Wages Act, 1936 whereas, the petitioner is proceeded against with the aid of the , and the Rules framed thereunder. The learned counsel for the petitioner added that the complaint does not contain specific pleading as to whether the establishment comes under the definition of ‘employment’ under the Kerala Shops and Commercial Establishments Act, 1960 .
7. The employments that come under the Minimum Wages Act, 1948 are enumerated in the schedule appended to the Act. As per Section 30 of the Act, the Government may make rules for carrying out the purposes of the Act. The Kerala Minimum Wages Rules, 1958 has been enacted in exercise of the powers conferred by Section 30 of the . Rule 21A of the Rules reads thus:-
“21A. Payment of wages through I.T. ena
