2017 (7) TMI 1382 - SC - Indian Laws

Validity of Criminal proceedings - prosecution Under Section 39 of the Standards of Weights and Measures Act, 1976 read with Rule 4, 6, 8 and 23(1) of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 - HELD THAT - In the present complaint petition, there is no averment or statement whatsoever that the Appellant as the Managing Director of the Company was responsible or incharge of the conduct of the business of the Company in respect of which the offence in question has been alleged to have been committed. Neither there is any averment to the effect that the Appellant is otherwise connected or responsible for commission of any of the acts on the basis of which the offence(s) is alleged to have been committed. The proceedings against the accused-Appellant are liable to be quashed - Appeal allowed - decided in favor of appellant.

Summary

Issues: Challenge against the order of the High Court dismissing the petition for quashing criminal proceedings under Section 482 Code of Criminal Procedure.

In this judgment, the Supreme Court considered an appeal challenging the High Court of Karnataka's order dismissing a petition filed under Section 482 Code of Criminal Procedure by the Managing Director of a company facing prosecution under the Standards of Weights and Measures Act, 1976. The complaint alleged that the company had committed an offense, and the Managing Director was sought to be made vicariously liable due to holding the office at the relevant time. The Court noted that the complaint did not specifically attribute any act of the Managing Director resulting in the alleged offenses. The Court referred to Section 74 of the Act, which imposes vicarious liability on individuals in charge of a company if an offense is committed by the company. However, the Court observed that the complaint lacked averments establishing the Managing Director's responsibility for the company's conduct in relation to the alleged offense. The Court emphasized the need for a clear and categorical statement in the complaint to establish vicarious liability of a company officer. Since the complaint did not implicate the Managing Director in any specific act leading to the offense and did not establish his responsibility for the company's conduct, the Court held that the proceedings against the accused-Appellant were liable to be quashed. Consequently, the Court set aside the High Court's order and allowed the appeal.