2003 (11) TMI 70 - SC - Central Excise

Offence by company - Vicarious liability - Director and assistant manager acquitted by Trial Court - High Court Quashed proceeding against Company on the basis that no person is available for mandatory punishment u/s 9(1)(i) - Held that - in view of Section 9(1)(i) of the Central Excises and Salt Act there is vicarious liability on the officers in-charge of the company who if the company is found to be guilty shall also deem to be guilty of the offences charged against the company therefore the High Court was not justified in quashing the proceedings. But on the facts of this case that argument cannot be entertained because though these Director and Assistant Manager of the company were arrayed as accused persons in these very same proceedings along with the company the said two Director and Assistant Manager by virtue of the inaction of the complainant were discharged therefore they cannot now tried once again with the aid of Section 9(1)(i) of the Act. Learned Counsel appearing for the respondent also contended that the offences in question was prior to coming into force Section 9(1)(i) of the Act which was on 27th December 1988 therefore even otherwise the complainant could not have relied on the said Section. It is not necessary for us to go into this question since the Director and Assistant Manager were once discharged and that discharge having become final they cannot be tried once again for the very same offence and in their absence company alone cannot be tried for an offence under Section 9(1)(i) of the Act - Decided against Revenue.

Summary

Issues:
1. Discharge of Director and Assistant Manager for want of notice.
2. Quashing of proceedings against the company under Section 482 of the Criminal Procedure Code.
3. Vicarious liability of officers in-charge under Section 9(1)(i) of the Central Excises and Salt Act.
4. Applicability of Section 9(1)(i) of the Act to the case.
5. Double jeopardy and finality of discharge.

Analysis:
1. The complaint was filed against the respondent-Company and two others, Director and Assistant Manager, under Section 9(1)(i) of the Central Excises and Salt Act. The Trial Court discharged the Director and Assistant Manager due to the lack of notice served on them during the trial proceedings, which led to an application for discharge by A-2 and A-3.

2. The Company filed an application before the High Court under Section 482 of the Criminal Procedure Code seeking to quash the proceedings against it. The High Court accepted the argument that since there was no individual representing the company in court and Section 9(1)(i) of the Act mandates imprisonment, the proceedings against the company could not be maintained. The complainant appealed against this decision.

3. The contention was raised regarding vicarious liability on officers in-charge of the company under Section 9(1)(i) of the Act. However, as the Director and Assistant Manager were discharged during the trial, they could not be tried again for the same offense. The argument that the offenses occurred before the enactment of Section 9(1)(i) was also presented, but the final discharge of the officers made it unnecessary to delve into this aspect.

4. The Court emphasized that since the Director and Assistant Manager had been discharged and could not be retried for the same offense, the company alone could not be tried under Section 9(1)(i) of the Act. Therefore, there was no justification to interfere with the High Court's decision to quash the proceedings against the company, and the appeal was dismissed.

This comprehensive analysis covers the issues of discharge of individuals, quashing of proceedings, vicarious liability, applicability of the Act, and the principle of double jeopardy in the legal judgment delivered by the Supreme Court of India.