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TMI Blog2018 (3) TMI 1947X X X X Extracts X X X X X X X X Extracts X X X X ..... actured and packed by the Company. A panchnama was prepared. The sample was sent to Food Analyst and according to the report of Food Analyst, the sample was found to be unsafe under Sections 3(zz)(iii) and 26(2)(i) of the Act. The designated officer sent copy of the report to the applicant. The sanction for prosecution to file a complaint under Section 36 of the Act was granted and accordingly, the complaint has been filed for offence under Sections 3(zz)(ii), 26(2)(i) r/w Section 59 of the Act. Challenging the order taking cognizance, the present application has been filed. Although several grounds have been taken by the applicant, but the counsel for the applicant confined his argument to a singular question of law. It is submitted by the counsel for the applicant that according to the complaint itself, the principal/primary accused in the present case is Satya Sai Agroils Private Limited and thus, without impleading the Company as an accused, the applicant cannot be prosecuted, merely being the nominee of the Company. The applicant can be held vicariously liable only when the Company is made an accused. Since the liability is penal in nature, therefore, strict interpretation o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Godfather Tours and Travels (P) Ltd., (2012) 5 SCC 661 : 2012 (3) Supreme 416 has held as under: "25. In Halsbury's Laws of England, Vol. 11(1), in Para 35, it has been laid down that in general, a corporation is in the same position in relation to criminal liability as a natural person and may be convicted of common law and statutory offences including those requiring mens rea. 26. In 19 Corpus Juris Secundum, in Para 1358, while dealing with liability in respect of criminal prosecution, it has been stated that a corporation shall be liable for criminal prosecution for crimes punishable with fine; in certain jurisdictions, a corporation cannot be convicted except as specifically provided by the statute. 27. In H.L. Bolton (Engg.) Co. Ltd. v. T.J. Graham & Sons Ltd. Lord Denning, while dealing with the liability of a company, in his inimitable style, has expressed that: (QB p. 172) "... A company may in many ways be likened to a human body. It has a brain and nerve centre which controls what it does. It also has hands which hold the tools and act in accordance with directions from the centre. Some of the people in the company are mere servants and agents who are noth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n observed that the legal position in England and the United States has now been crystallised to leave no manner of doubt that the corporation would be liable for crimes of intent. 30. In the said decision, the two-Judge Bench has observed thus: (Motorola Inc. case, SCC p. 98, para 59) 7 M.Cr.C. No. 8057 of 2009 "59. The courts in England have emphatically rejected the notion that a body corporate could not commit a criminal offence which was an outcome of an act of will needing a particular state of mind. The aforesaid notion has been rejected by adopting the doctrine of attribution and imputation. In other words, the criminal intent of the 'alter ego' of the company/body corporate i.e. the person or group of persons that guide the business of the company, would be imputed to the corporation." 31. In Standard Chartered Bank, the majority has laid down the view that: (SCC p. 541, para 6) "6. There is no dispute that a company is liable to be prosecuted and punished for criminal offences. Although there are earlier authorities to the effect that corporations cannot commit a crime, the generally accepted modern rule is that... a corporation may be subject to indictment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly sub-section (4) of Section 171-A wherein an enquiry by the Customs Authority is referred to, and the language employed therein, namely, "to be deemed to be a judicial proceeding within the meaning of Sections 193 and 228 of the Penal Code", it has been opined as follows: (SCC p. 680, para 37) "37. ...It was argued that the legislature might well have used the word 'deemed' in sub-section (4) of Section 171 not in the first of the above senses but in the second, if not the third. In our view, the meaning to be attached to the word 'deemed' must depend upon the context in which it is used." 37. In State of T.N. v. Arooran Sugars Ltd. The Constitution Bench, while dealing with the deeming provision in a statute, ruled that the role of a provision in a statute creating legal fiction is well settled. Reference was made to Chief Inspector of Mines v. Karam Chand Thapar, J.K. Cotton Spg. and Wvg. Mills Ltd. v. Union of India, M. Venugopal v. LIC and Harish Tandon v. ADM, Allahabad and eventually, it was held that when a statute creates a legal fiction saying that something shall be deemed to have been done which in fact and truth has not been done, the Court has to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o held by a three-Judge Bench in Aneeta Hada v. Godfather Travels and Tours (P) Ltd. in the context of the Negotiable Instruments Act, 1881." 5. This Court by order dated 20.02.2017 passed in M.Cr.C. No. 1301 of 2011 (Managing Director vs. State of M.P.) has held as under:- "Thus, as the Marico Industries Limited, Mumbai has not been arrayed as an accused, therefore, the prosecution of the applicant in his official capacity is not permissible because he cannot be vicariously held liable for the offence committed by the Company unless and until, the Company which is a juristic entity is arrayed as an accused." Thus, if the facts of the present case are considered in the light of the judgments, then it would be clear that Satya Sai Agroils Private Limited is the manufacturer of soya products, however, the Company has not been made an accused and the applicant is being prosecuted in the capacity of nominee of the Company. The applicant cannot be held vicariously liable for offence committed by the Company in absence of prosecution of Company. Therefore, this Court is of the considered view that as the Company which is the manufacturer of soya products, has not been arraigned as an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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