MARICO LTD Vs. STATE OF GUJARAT

JUDGEMENT

(1.) The present Criminal Misc. Application is filed by the applicants under Section 482 of the Code of Criminal Procedure for quashing and setting aside the the order of issuance of notice dated 30.08.2012 passed below Exhibit161, whereby the original complainant is seeking to implead applicants nos. 2 to 8 being the Directors in Criminal Case No. 11 of 2009, pending on the file of learned Judicial Magistrate, First Class, at Muglisara, District : Surat.

(2.) The case of the applicants is that applicant no. 1 is a Company registered under the Companies Act, 1956 and is engaged in the business of manufacturing, marketing and distributing for sale, stocking for sale and selling the food articles including 'Saffola Tasty Losorb Technologies through their manufacturing unit. Respondent no. 2 is the Food Inspector who is the original complainant, has lodged a complaint bearing Criminal Case No.11 of 2009 against Salesman ­ Rushikesh G. Shah and other eight persons including applicant no. 1 Company namely Marico Ltd. The said complaint came to be filed on 20.03.2009 in the Court of learned Judicial Magistrate, First Class, Surat under Section 7 read with Section 6 of the Prevention of Food Adulteration Act, 1954 and Rules [the "Act" for short]. On 25.11.2008, the sample of Saffola Tasty Losorb Technology, one liter pouch was collected and the same was found to be adulterated as it did not comply with the standards laid down under the provisions of prevailing Food Adulteration Rules, 1955 which allowed the complainant to lodge Criminal Case No. 11 of 2009 before the learned Judicial Magistrate, First Class, at District : Surat. The criminal case appears to have been filed after getting proper consent/approval from the competent authority to lodge the prosecution. Applicant No.1 ­ Company is a legal entity and had appointed as a nominee one Mr. Naresh Gehlaud under Section 17 subsection (2) of the Act and the case was pending. It is the case of the applicants that the said case is pending wherein yet the trial is not commenced and even plea of the accused is not recorded and it is at the stage of precharge evidence and the said precharge evidence is yet to be recorded. It is the case of the applicants that after a period about three years, after filing of the complaint, the complainant preferred an application below Exhibit161 seeking to implead the Directors of the Marico Ltd., as accused persons in the criminal prosecution and upon such brief application, straightaway the learned Magistrate on 30.08.2012 was pleased to issue notice. The case of the applicants is that bare look of the said application would clearly indicate that all the Directors are not to be dragged into prosecution. However, without looking at it, straightaway, the application came to be entertained and notice is issued upon the present applicants more particularly, applicants nos. 2 to 8. It is in the background of this eventuality, the present applicants have approached this Court by invoking Section 482 of the Code of Criminal Procedure for seeking quashing and setting aside the order dated 30.08.2012 passed below Exhibit161. The Court while entertaining this application, initially notice came to be issued and thereafter, by detail order on 05.09.2013 relying upon two decisions as incorporated in the order dated 05.09.2013, interim order came to be granted in respect of the impugned order. Since then, the case is pending. Later on, the application came up for consideration before this Court on 10.04.2014 wherein in view of the interpretation of Section 20(A) of the Act, the matter deserves consideration, came to be admitted and now same has come up for final disposal.

(3.) Learned advocate Ms. Megha Jani appearing on behalf of the applicants contended that, the application Exhibit161 is premature. In the sense, that yet the trial of the criminal case has not commenced and it has been stated before the Court that powers are always available to the Court that during the course of trial, if ultimately, the learned Magistrate, found something against the Directors, then at that stage, they can be joined as accused persons, but at pretrial stage, it is not open for the learned Magistrate to entertain such application. It was further contended on behalf of the applicants that no offence under the provisions of Food Adulteration Act is made out against the applicants and the learned advocate has specifically pointed out that there is no averment in the main application or even in the complaint that the Directors of the applicant no. 1 Company are connected even remotely with the alleged offence. There appears to be no single averment qua applicants nos. 2 to 8 to the effect that they are looking after the day to day business/day to day affairs of the Company and, therefore, on this ground alone, the learned counsel requested the Court to set aside the impugned order. It is further pointed out by the learned counsel that it is obligatory on the part of the complainant to indicate in the complaint itself that to how and in what manner the concerned Director is in charge of or responsible in routine day to day affairs of the Company to shift vicarious liability. A bare reading of the complaint is not incorporating any averment which would remotely suggest that applicants nos. 2 to 8 are responsible for the affairs of the Company. The learned counsel further submitted to the Court that the Directors can be dragged in the prosecution only if there is no nominee appointed under Section 17 of the Act and herein in the present case, the nomination has already been placed on the record with a specific name as required under Section 17 of the Act and, therefore, the Company itself has taken up prosecution seriously and has disputed nominee to face trial and, therefore, it is not gainsay to say that all the Directors i.e. applicants nos. 2 to 8 are responsible for the affairs of the Company or for commission of alleged offence. In the background of these facts, the learned counsel has drawn attention to the decision of the Apex Court in the case of Omprakash Shivprakash v. K.I. Kuraikose & Ors.. reported in (1999) 8 SCC 633, wherein it has been pointed out that Section 20(A) of the Act can be resorted to at a particular stage and that stage is not pretrial, but posttrial stage and, therefore, at this stage of the proceedings when even pretrial evidence is yet to be recorded, charges are yet to be framed, application submitted by the complainant is not tenable, no entertainable as the same is premature. Relying upon this decision of the Apex Court even this Court has also delivered a decision on 23.04.2012 rendered in Criminal Misc. Application No. 12093 of 2008 wherein also, similar view is taken and it has been propounded that Section 20(A) of the Act powers are meant to be exercised after commencing of the trial and, therefore, the order passed by the learned Magistrate is without jurisdiction and, therefore, since it is at the premature stage, the same deserves to be quashed in the the interest of justice. The learned counsel further submitted that if ultimately, after the trial, if the learned Magistrate find that there is some material qua applicants nos. 2 to 8, it is always open for the learned Magistrate to invoke powers under Section 20(A) of the Act. Therefore, to permit the prosecution to join the Directors at this stage of the prosecution is nothing but abuse of process of law and, therefore, in the background of these facts and circumstances, the learned counsel for the applicants requested the Court to set aside the impugned order.