CRL.Rev.Pet.No.688 of 2019

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V** ## **MONDAY, THE 15TH DAY OF JULY 2019 / 24TH ASHADHA, 1941** ## **CRL.REV.PET.NO.688 OF 2019** **AGAINST THE ORDER IN CRL.M.P. NO.936 OF 2018 IN SC NO.1106/2014 OF SESSIONS COURT, THIRUVANANTHAPURAM DATED 25-02-2019** ## **REVISION PETITIONERS/ACCUSED 1 TO 4:** - **1 M/S. ADROIT PHARMACEUTICAL PVT LTD., 46, GARBIA MAIDAN BASTI PRECINCT, NAGPUR-440 008, REPRESENTED BY ITS DIRECTOR SRI. SANJAY C. KUKREJA.** - **2 SANJAY C. KUKREJA, DIRECTOR, M/S. ADROIT PHARMACEUTICAL PVT. LTD.,46, GARBIA MAIDAN BASTI PRECINCT, NAGPUR-440 008.** - **3 BHUPESH A KUKREJA, DIRECTOR, M/S. ADROIT PHARMACEUTICAL PVT. LTD.,46, GARBIA MAIDAN, BASTI PRECINCT NAGAPUR-440 008.** - **4 G.H. KUKREJA, MANAGING DIRECTOR, M/S. ADROIT PHARMACEUTICAL PVT. LTD.,46, GARBIA MAIDAN, BASTI PRECINCT, NAGPUR-440 008.** ## **BY ADV. SMT.P.USHAKUMARI** ## **- RESPONDENT/DE FACTO COMPLAINANT & STATE:** **THE STATE OF KERALA, REPRESENTED BY THE CHIEF INSPECTOR, DRUGS INTELLIGENCE SQUARD, OFFICE OF THE DRUGS CONTROLLER, THIRUVANANTHAPURAM-695 035, REPRESENTED BY THE DIRECTOR GENERAL OF PROSECUTIONS, HIGH COURT OF KERALA, KOCHI-682 031..** **BY ADV. ADDL.DIRECTOR GENERAL OF PROSECUTION** ## **OTHER PRESENT:** ## **BY ADV. AJITH MURALI, PUBLIC PROSECUTOR** **THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY HEARD ON 15.07.2019, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **Crl.Rev.Pet.No.688 of 2019** **2** ## **O R D E R** The petitioners herein are the accused Nos. 1 to 4 in S.C. No.1106 of 2014 on the file of the Additional Sessions Judge-IV, Thiruvananthapuram. They have been summoned to answer a charge under Section 17A(e) r/w. Sections 18(a)(i) and 27(a) of the Drugs and Cosmetics Act, 1940 (for short, 'the Act'). 2. The instant Criminal Revision Petition is filed under Section 401 of the Code of Criminal Procedure (for short, ‘Cr.P.C’.) challenging the order dated 25.02.2019 passed by the learned Additional Sessions Judge IV, Thiruvananthapuram, rejecting the petition filed by the petitioners under Section 227 of the Cr.P.C. seeking discharge. 3. The factual background relating to the proceedings under challenge can be set out in the following manner: The 1[st] petitioner is a Company registered under the Companies Act, 1956 having its registered office at Nagpur. The petitioners 2 and 3 are the Directors of the said Company and the 4[th] petitioner is its Managing Director. The said Company is licensed to manufacture drugs and pharmaceuticals. Paracetamol syrup meant for administering to sick children is one of the products manufactured by the petitioners. It is a clear solution/oral suspension. The Director of Medical Education, Thiruvananthapuram lodged a complaint before **Crl.Rev.Pet.No.688 of 2019** **3** the Office of the Drugs Controller that among the 60 ml bottles of Paracetamol syrup issued for the supply to the Child Development Project Office at Kilimanoor, one unopened bottle was found to contain a piece of steel blade. An enquiry was conducted and the bottle of drug was seized on 29.12.2018. On the same day itself, the drug was produced before the learned Magistrate. According to prosecution, the act committed by the petitioners would attract the offence under Section 17A(e) of the Drugs and Cosmetics Act, 1940. 4. Smt. Ushakumari P., the learned counsel appearing for the petitioners, submitted that the 1[st] petitioner is a leading Pharmaceutical Company with a clean track record. It is urged that while conducting the seizure, the mandatory procedures have been violated. She contends that there is every reason to doubt that the seized drugs have been tampered with. She points out that it is mandatory for the de facto complainant to allege that the petitioners were in-charge and responsible for the conduct of business of the Company. Merely because the petitioners are the Directors of the Company, may not ipso facto be sufficient to make them liable for the acts committed by the Company. In order to substantiate her submission, reliance is placed on the decisions of the Apex Court in **State of Haryana v. Brij Lal Mittal and Others** [(1998) 5 SCC 343], **Rahul Sehgal v. State of Kerala and Another** [2014 (2) KHC 11] and **Mukesh Bhagubhai Patel v. State of Kerala** [2014 (3) KLT 553]. The learned counsel would further urge that without forwarding the drug for **Crl.Rev.Pet.No.688 of 2019 4** analysis, the complainant could not have approached the learned Magistrate and alleged violation of Section 17A of the Act. Various other contentions touching the merits of the case were advanced before this Court while assailing the order passed by the court below. 5. The learned Additional Director General of Prosecution would seriously oppose the prayer. It is submitted that at the stage of Section 227 of the Cr.P.C., all that the trial court was bound to look into is as to whether there is sufficient ground for proceeding against the accused. Only prima facie case is to be seen and the probative value of the materials cannot be looked into by the court. He submitted that the contentions advanced by the learned counsel appearing for the petitioners as to the genuineness of the search and seizure cannot be looked into at this stage as the evidence is yet to be adduced. Insofar as the lack of averments in the complaint is concerned, it is submitted that it has been stated in clear terms that the 1[st] petitioner is a Company of which the 4[th] petitioner is the Managing Director. The petitioners 2 and 3 are Directors of the said Company. It is for the accused to prove that the offence was committed without their knowledge and consent and this fact will have to be substantiated before the trial court. No interference is warranted, submits the learned Additional Director General of Prosecution. 6. I have considered the submissions advanced and have gone through the complaint and the documents accompanying the same. Under challenge is **Crl.Rev.Pet.No.688 of 2019 5** the order passed by the learned Sessions Judge in a petition seeking discharge filed by the petitioners. As rightly submitted by the learned ADGP, at the time of framing of the charge, it is not necessary for the prosecution to establish beyond all reasonable doubts that the accusations which are brought out against the accused are bound to be brought home. The purpose of Sections 227 and 228 of the Code is to ensure that the courts would be satisfied that the accusations made against the accused are not frivolous and there is some material for proceeding against them. The evidence is yet to be taken and the aspects which accused term as vulnerable can very well be clarified by evidence when the prosecution has its opportunity of placing the case through witness in court. It would be hazardous to act on the discrepancies unless they are so fatal and glaring as to affect the credibility of the prosecution case without affording reasonable opportunity to the prosecution to substantiate the allegation. (see **Eastern Spinning Mill and Virendra Kumar Sharda v. Rajiv Poddar** [AIR 1985 SC 1668]. In other words, at the stage of framing charge, the court has only to see if there is sufficient ground for presuming that the accused has committed an offence. If the answer is in the affirmative, the order of discharge cannot be passed and the accused will have to face trial. 7. In the light of the aforementioned principles, I have scrutinized the allegations in the complaint and also the materials relied on by the prosecution to bring home the guilt. The contention of the learned counsel appearing for the **Crl.Rev.Pet.No.688 of 2019 6** petitioners that the drug which is produced before the court is tampered cannot be accepted at this stage. The drug was produced before the jurisdictional court on the same day. The validity of the seizure also cannot be looked into at this stage. I am also unable to accept the submission that the prosecution proceedings cannot be sustained without chemical examination. A solid object in the form of a blade was found in a drug which is to be administered to children. As to whether Section 17A(e) of the Act would apply or not, is for the trial court to consider. 8. However, the submission advanced by the learned counsel with regard to the lack of averments in the complaint will have to be looked into in more detail. According to the prosecution, the 1[st] accused is a Company and petitioners 2 and 3 are its Directors. The 4[th] petitioner is admittedly, the Managing Director of the Company. They are being prosecuted with the aid of Section 34(1) of the Act, which reads as under: “34. Offences by companies.— (1) Where an offence under this Act has been committed by a company, every person who at the time the offence 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 offence and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub-section shall render any such person liable to any **Crl.Rev.Pet.No.688 of 2019** **7** punishment provided in this Act if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.” 9. In the complaint, a copy of which is produced as Annexure-A1, the pleading is as below: “The second, third and fourth accused are the Directors and Managing Director of the 1[st] accused firm.” 10. It can be seen from Section 34 of the Act that the vicarious liability of a person for being prosecuted for an offence committed under the Act by a company arises if, at the material time, he was in-charge of and was also responsible to the company for the conduct of its business. Simply because a person is a Director of the company does not necessarily mean that he fulfills both the above requirements so as to make him liable. Conversely, without being a Director, a person can be in-charge of and responsible to the company for the conduct of its business. (See **State of Haryana v. Brij Lal Mittal** [(1998) 5 SCC 343]). However, in the case of a Managing Director, the situation would be different. Holders of such position in a company, by virtue of their office are deemed to be in-charge and responsible for the business of the company. The said view has been taken by the Apex Court while considering Section 141 of the Negotiable Instruments Act, which is in pari materia the provisions of Section 34 of the Drugs and Cosmetics Act. The entire case law was reviewed by the Apex Court in **Gunmala Sales Pvt. Ltd v. Anu Mehta & Ors** [(2014) 1 SCC 103] **Crl.Rev.Pet.No.688 of 2019 8** and it was held that if accused is a Managing Director or a Joint Managing Director then it is not necessary to make specific averment in the complaint and by virtue of their position, they are liable to be proceeded with. 11. In **Delhi Municipality v. Ram Kishan** [(1983) 1 S.C.C. 1], while dealing with the applicability of Section 17(1) of the Prevention of the Food Adulteration Act, 1954, which is in pari materia with Section 34(1) of the Act, on similar facts, the Apex Court had observed as under: "So far as the Manager is concerned, we are satisfied that from the very nature of his duties it can be safely inferred that he would undoubtedly be vicariously liable for the offence, Various liability being and incident of an offence under the Act. So far as the Directors are concerned, there is not even a whisper not a shred of evidence nor anything to show, apart from the presumption drawn by the complainant, that there is any act committed by the Directors from which a reasonable inference can be drawn that theycould also be vicariously liable. In these circumstances, therefore, we find ourselves in complete agreement with the argument of the High Court that no case against the Directors (accused Nos. 4 to 7) has been made out ex facie on the allegations made in the complaint and the proceedings against them were rightly quashed." 12. In the light of the above discussion, the conclusion is inescapable that the petitioners 2 and 3 cannot justifiably be proceeded against for having committed the offence due to the absence of averments in the complaint. **Crl.Rev.Pet.No.688 of 2019 9** However, the 4[th] petitioner by virtue of the fact that he is the Managing Director of the Company is liable to be proceeded against. 13. At this stage, Smt. Ushakumari, the learned counsel, produced a certificate issued by the General Physician of the Shivleela Maternity & Medical Nursing Home and it is submitted that the 4[th] petitioner is ailing from Parkinson diseases for the past one year and prays that necessary directions be issued to the learned Sessions Judge to grant him exemption. The 4[th] petitioner may file appropriate application seeking exemption with substantiating documents and the learned Sessions Judge shall consider the same sympathetically and pass appropriate orders on merits. In the result, this petition will stand partly allowed. The petitioners 2 and 3, who are the accused Nos. 2 and 3 in S.C.No.1106 of 2014 on the file of the Court of Session, Thiruvananthapuram, will stand discharged. This petition insofar as it concerns the petitioner Nos. 1 and 4, will stand dismissed. Being the Managing Partner of the Company, the 4[th] petitioner shall represent the Company in the prosecution proceedings. SD/- ## **RAJA VIJAYARAGHAVAN V., JUDGE** NS //TRUE COPY// P.A. TO JUDGE **Crl.Rev.Pet.No.688 of 2019** **10** ## **APPENDIX** ## **PETITIONER(S) ANNEXURES:** |**ANNEXURE A1**|**PHOTOSTAT COPY OF THE COMPLAINT S.C. NO. 1106/2014**| |---|---| ||**FILED**<br>**BEFORE**<br>**THE**<br>**LEARNED**<br>**SESSIONS**<br>**COURT,**| ||**THIRUVANANTHAPURAM BY THE RESPONDENT.**| |**ANNEXURE A2**|**TRUE COPY OF THE COVERING LETTER ISSUED BY THE**| ||**RESPONDENT DATED 29.12.2008**| |**ANNEXURE A3**|**TRUE COPY OF THE LIST OF DOCUMENTS DATED 29.12.2008**| ||**PRODUCED BY THE RESPONDENT.**| |**ANNEXURE A4**|**TRUE COPY OF THE MAHAZAR DATED 29.12.2008 FIELD BY THE**| ||**RESPONDENT BEFORE THE LEARNED SESSIONS COURT,**| ||**THIRUVANANTHAPURAM.**| |**ANNEXURE A5**|**TRUE COPY OF THE LETTER ISSUED BY THE DIRECTOR OF**| ||**SOCIAL WELFARE DEPT, DATED 5.12.2008 TO THE CHILD**| ||**DEVELOPMENT SCHEME DIRECTOR BY NO.ICDS/A1-7954/08.**| |**ANNEXURE A6**|**TRUE COPY OF THE CONTRACT ENTERED INTO BETWEEN THE 1ST**| ||**PETITIONER COMPANY AND THE JOINT DIRECTOR OF SOCIAL**| ||**WELFARE DEPARTMENT, POOJAPPURA, THIRUVANANTHAPURAM IN**| ||**THE MONTH OF MARCH 2007.**| |**ANNEXURE A7**|**TRUE COPY OF THE JUDGMENT IN CRL.M.C NO. 7412/2017**| ||**DATED 24.11.2017 OF THIS HONOURABLE COURT.**| |**ANNEXURE A8**|**TRUE COPY OF THE DISCHARGE PETITION VIZ, CRL.M.P. NO.**| ||**936/2018 FILED IN S.C. NO. 1106/2014 BEFORE THE**| ||**LEARNED SESSIONS COURT, THIRUVANANTHAPURAM.**| |**ANNEXURE A9**|**TRUE COPY OF THE OBJECTION FILED BY THE RESPONDENT**| ||**ANNEXURE A8 DISCHARGE PETITION.**| |**ANNEXURE A10**|**PHOTOSTAT COPY OF THE CERTIFICATE ISSUED BY DR.SHYAM**| ||**KEWALRAMANI TO THE 4TH REVISION PETITIONER DATED**| ||**12.07.2019.**| ## **RESPONDENT(S) ANNEXURES: NIL**