1997 (10) TMI 389 - SC - Indian Laws

Order of acquittal of the charge under Section 120-B of the Indian Penal Code read with Sections 7 and 8 of the Essential Commodities Act, 1955 and Clause (5) of the Iron and Steel Control Order after applying Section 10 of the Essential Commodities Act Held that - The order of the High Court is obviously correct. No evidence on the record has been pointed out from which it could be inferred that the two respondents had any knowledge of the sale which was manoeuvred by Kamdar and Vallabhadas Thacker, nor is there evidence to show that they took any part in the negotiations for sale, or in the sale itself. Consequently, it is clear that their conviction was not justified. In the present case, there is no finding either by the Magistrate or by the High Court that the sale in contravention of Clause 5 of the Iron & Steel (Control) Order was made by the Company. In fact, the Company was not charged with the offence at all. The liability of the persons in charge of the Company only arises when the contravention is by the Company itself. Since, in this case, there is no evidence and no finding that the Company contravened Clause 5 of the Iron & Steel (Control) Order, the two respondents could not be held responsible. The actual contravention was by Kamdar and Villabhadas Thacker and any contravention by them would not fasten responsibility on the respondents. The acquittal of the respondents is, therefore, fully justified. The appeal fails and is dismissed.

Summary

Issues:
Acquittal under Section 120-B IPC read with Essential Commodities Act and Iron and Steel Control Order, applicability of Section 10 of Essential Commodities Act.

Analysis:
The case involved an appeal against the acquittal of two respondents under Section 120-B IPC read with Essential Commodities Act and Iron and Steel Control Order. The respondents, a manager and managing director of a company, were accused of conspiring to sell pig iron at prices higher than the controlled rate. The trial magistrate convicted them based on their association with the company and the timing of the sale negotiations. However, the High Court acquitted the respondents, emphasizing the lack of evidence showing their direct involvement in the sale or knowledge of it. The High Court correctly ruled that suspicion alone cannot substitute for proof in establishing guilt. The absence of evidence linking the respondents to the sale led to their acquittal.

The appellant argued for the respondents' conviction under Section 10 of the Essential Commodities Act, which holds individuals responsible if the company contravenes an order. However, for this provision to apply, the company itself must commit the contravention. In this case, neither the Magistrate nor the High Court found the company guilty of the offense, as it was not even charged. Since the contravention was carried out by other individuals, the respondents, who were in charge of the company, could not be held liable under Section 10. Therefore, the acquittal of the respondents was deemed appropriate, and the appeal against it was dismissed.