M KARUPPANNAN Vs. STATE

JUDGEMENT

(1.) IN both those cases the same petitioner has come forward with the prayer to call for the records and quash the proceedings in s. T. C. Nos. 16 of 1987 and 14 of 1987, on the file of the Special Court for Essential Commodities act cases at Madurai. It is the contention of the petitioner that he was the President of the thamaraikulam Agricultural Cooperative Society Limited, and the Society is having its registered office at Thamaraikulam and it is an authorised dealer for the sale and supply of essential commodities to the family card holders registered with the Society and the Society distributes essential commodities to the family card holders through its Branch Vaigai Fair Price Shop situated in the village. IN the affidavit filed it has ben mentioned that he was serving as a President of the Society for over 3 years and there is a Secretary who is incharge of the overall administration of the affairs of the Society and there are three salesmen employed by the Society who are incharge of day to day conduct of the business at Branch Vaigai Fair Price Shop.

(2.) THE Tahsildar, Flying Squad, Madurai, is stated to have inspected Branch Vaigai Fair Price Shop at Thamaraikulam and Tahsildar visited viz. , 1st July, 1986 no doubt the petitioner happened to be the president of the Society. But unfortunately the said fact has not been properly mentioned either in the charge-sheet or in the Complaint But on the other hand it had been shown that he was the President form 30th June, 1984 to 30th november, 1984. Under S. 10 (1) of the Essential Commodities Act, if the person contravening an order made under S. 3 is a Company, every person who, at the time the contravention was committed, was in charge of, and was responsible to, the Company for the conduct of the business of the Company as well as the company, shall be deemed to be guilty of the contravention and shall be liable to the proceeded against. Under the proviso it is stated that nothing shall render any such person liable to any punishment if he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention. Again under sub-S. (2) of S. 10 it is stated that notwithstanding anything contained in sub-S (1) , where an offence under this Act has been committed by a Company and it is proved that the offence has been committed with the consent or connivance of or is attributable to any neglect on the part of any director, manager, secretary or other officer of the Company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. As regards the petitioner it has been alleged in the charge sheet in S. T. C. No. 14 of 1987 that the petitioner being the president was in overall charge of the affairs of A. 1 including the appointment of salesmen and other employees and the acts of commission and omission by A. 5 and A. 6 are attributable to the negligence on the part of A. 2 to A. 4 to exercise due diligence to prevent the commission of such offences. THEre is nothing to indicate when the Tahsildar inspected and checked the stores the president was available. Merely because the President happened to be a person who appointed the salesman it cannot be said that the President will become liable for the acts of commission and omission by the salesmen. In S. T. C. No. 15 1987 it has been mentioned that the acts of commission and omission are attributable to the negligence on the part of A. 2 the President and A. 3 who was the Secretary to exercise due diligence to prevent the commission of such offences. While under S. 10 (g) what is required to be proved is that the offence had been committed with the consent or connivance or is attributable to any neglect on the part of any director, manager, secretary, etc. , then they will become liable. At the time of inspection by the Tahsildar, as already stated, only the salesmen were present. Learned counsel for the petitioner relied on two decisions reported in Viswanathan v. State Superintendent of Police, 1982 L. W. (Crl.) 70. and Ramamurthi, K. G. v. Inspector of Police, 1983 L. W. (Crl.) 62. Both the decisions had been rendered by the learned judge M. N. Moorthy, J. THE decision reported in Viswanathan v. State Superintendent of Police, 1982 L. W. (Crl.) 70, related to a case of the President of the Co-operative Society charged along with the Secretary under Ss. 409 and 477 A, I. P. C. , read with S. 34, I. P. C. A petition had been filed under S. 482, Crl. P. C. by the President who was A1 to quash the proceedings. In that case the learned Judge had observed with regard to the entries relating to that case that when entries of number of persons are there it may not be possible to check each and every entry by the President himself. THE other decision reported in Ramamurthi, K. S. v. State Inspector of police, 1983 L. W. (Crl.) 62 also was rendered in a petition filed under S. 482, crl. P. C. THE case related to the Manager of the Amaravathi Co-operative Sugar mill employees Co-operative stores on deputation and the facts revealed that a cheque dated 27th July, 1968 signed by A3 the Vice President had ben encashed by the Manager. While the cheque was for Rs. 2,090, only Rs. 2,000 had ben credited in the cash book and had been signed by A1 and there had been misappropriation of Rs. 90. According to the bye-law the petitioner was the ex-officio President and therefore he was sought to be made the accounts and stocks were verified by the officers in the presence of the three salesmen who were present in the shop. THE Tahsildar and the team found that the bills were prepared as though rice was sold to the family card holders at a higher price, but no entries had been made in the family cards. THEy also found that false bills were prepared as though essential commodities were supplied to the family card holders and in this regard the Tahsildar is shown to have given a complaint on 7th January, 1987 before the Civil Supplies C. I. D. , Police station, THEni, and they registered the case in Crime No. 1 of 1987 for offences under Cls. 6 (2xc) and 6 (2) (iii) of the Tamil Nadu Scheduled Commodities (Distribution by Card System) Order, 1988 read with S. 7 (1) (a) (i) of the essential Commodities Act. In the Special Court for Essential Commodities Act cases the Society and the petitioner, who is the President of the Society besides two others in S. T. C. No. 15 of 1987, and the Society and the President (the petitioner) besides four others in S. T. C. No. 14 of 1987 have been charge sheeted. In the charge sheet the petitioner had been shown to have been the president from 30th June, 1984 to 30th November, 1984 and he was incharge of overall affairs of the Society including appointment of salesman and other employees. But according to the petitioner he was not incharge of day to day business of the fair price shop though he was in overall charge of the affairs of the Society. Under S. 10 (1) of the Essential Commodities Act only those person who are incharge of the day to day conduct of the business are alone liable to be prosecuted. THE petitioner cannot be vicariously held liable for the act of the salesmen in a branch shop. THEre is no allegation that the petitioner conspired with the salesmen. THE fourth accused A. Ramakrishnan in S. T. C. No. 16 of 1987 and A5 v. Radhakrishnan and A6 P. Narayanan in S. T. C. No. 14 of 1987 were appointed on 17th December, 1984 and 30th July, 1984 by a resolution for writing proper accounts and keeping the stock registers up-to-date. In such circumstances the petitioner has filed these two petitions for quashing the proceedings.