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TMI Blog2003 (4) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... jit Jain and petitioner Sadhana Jain. Ajit Jain, husband of the petitioner was arrayed as accused No. 2 being the Managing Director of the said company and the petitioner herein was cited as accused No. 3 being the director of the said company. It was alleged in the complaint that the accused No. 1 was importing various types of synthetic linings from Taiwan through Chennai Port. A raid was conducted at the premises of the company on 30-10-1996 and some imported synthetic linings were seized. The statement of the petitioner and her husband were also recorded u/s 108 of the Customs Act. On further probe it was found that the said company had evaded import duty to the tune of Rs. 86,30,691/-. In para 13 of the complaint it was pleaded that as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Jain. Petitioner thereupon filed an application dated 24-2-1999 seeking discharge from the criminal proceedings initiated by the department of Revenue Intelligence on the basis of complaint u/s 132 and 135(1)(a) of the Act. This application was opposed by the department and after considering respective submissions made by the learned counsel for the parties, learned ACMM vide impugned order dated 30-1-2001 rejected the application being of the view that question as to whether the petitioner was in-charge or responsible for the conduct of the business of the company can be decided only after the evidence is led by the parties at the trial. 4. Feeling aggrieved, petitioner has preferred this petition u/s 482 Cr.P.C for quashing criminal pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccordingly." The contention of the petitioner is that on the basis of averments made in the complaint the petitioner cannot be made vicariously liable u/s 140 of the Act for offence committed by the company. Moreover, in the adjudication proceedings she has been exonerated by the Commissioner of Customs, therefore, proceedings arising out of complaint u/s 132 and 135(1)(a) of the Customs Act against her should be quashed. As against this, Mr. Satish Aggarwal, learned Counsel for the department contended that averments made in the complaint are sufficient to make petitioner vicariously liable of the offence committed by the company, and the finding arrived at during the adjudication proceedings do not bar criminal prosecution. In the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant in the departmental proceedings and this was concurred by the UPSC. The appellant then filed a petition under section 482 Cr.P.C in the High Court for quasing prosecution but the High Court rejected the petition being of the view that issues raised had to be gone into in the final proceedings. The appellant then approached the Supreme Court. Apex Court allowed the appeal and held that when on the same allegation appellant has been exonerated in the departmental inquiry there was no justification in continuing the prosecution. In the case of Uttam Chand v. Income Tax Officer, Central Circle, Amritsar Income Tax reports Vol. 133 page 909 (S.C.), the income tax department had launched prosecution against the petitioner for filing f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the complaint itself it was pleaded "as per the statement of accused Nos. 2 and 3 recorded on 26-3-1997 and 9-6-1997 the work of the accused No. 1 is/was mainly looked after by accused No. 2 and a few persons were employed to look after the local sales. This indicates that petitioner has been arrayed as accused No. 3 only because of her position as Director in the company whereas it is her husband accused No. 2 who used to lake active part and had control over affairs of the day to day business of the company. The department seems to have conceded this position before the Commissioner of Customs. This is clear from following observations contained at the end of para 45 of the order of the Commissioner of Customs "Smt. Sadhana Jain admittedl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that he was responsible for carrying on business and was during the relevant time in-charge of the business. In absence of any such proof, no partner can be convicted. Thus where the evidence produced by the department did not indicate that all the partners were actively participating in the business of the firm, it could not be said that when the offence was committed all the partners were conducting the business of the firm. Therefore, they will not be liable for conviction. As already stated in the present case there is no specific averment to the effect that the petitioner actively participated and was in control of the day to day business of the Company. From the averments made in the complaint, it appears that she was impleaded as a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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