w w w . L a w y e r S e r v i c e s . i n



Sri Ramakrishna Steel Industries Ltd., represented by its Managing Director & Others v/s State represented by Inspector of Labour Uthagamandalam District

    Crl.O.P.No. 12724 of 2003 and M.P.No. 4385 of 2003

    Decided On, 12 April 2010

    At, High Court of Judicature at Madras

    By, THE HONOURABLE MR. JUSTICE C.T. SELVAM

    For the Petitioners: K. Sukumaran, Advocate. For the Respondent: J.C. Durairaj Government Advocate (Crl.Side).



Judgment Text

(Criminal Original Petition filed under section 482 of Criminal Procedure Code praying to call for the records in C.C.No.1166 of 1999 on the file of the learned Judicial Magistrate, Mettupalayam and to quash the same.)


1. The petitioners, who are facing prosecution for offences under Sections 25(Q), 29 and 31 of Industrial Disputes Act, 1947 (hereinafter referred as Act) seek quash of proceedings as against them.


2. The petitioners are 13 in number. The 1st petitioner is the company. The petitioners 2 and 3 are shown as the Managing Director thereof. The petitioners 4 to 12 are shown as the directors, while the 13th petitioner is said to be Senior Deputy General Manager of the 1st petitioner company. The complaint has been filed against the petitioners and one another, who it is informed is now deceased, alleging that the 1st accused company Sri Ramakrishna Steel Industries Ltd., had pursuant to industrial unrest, entered into two agreements with the workers and staff union on 12.10.1995. The offence under Section 25M of the Act is alleged against these petitioners on the ground that they resorted to lay off of workers from November 1995 to 8th March 1998 without permission of the Joint Commissioner (Industries Department).The offence under Section 29 r/w 31 of the Act is alleged on the ground that further payments agreed upon towards family tour allowance for the year 1995-96, bonus at 8.33 per cent for the year 1996-97 and dress allowance of Rs.3,000/- and that the sums due, working out to a percentage of 37.5% to be paid 15 days prior to the Diwali festival had not been paid as per Clause 3 of the agreement.


3. The learned counsel for the petitioners submits that Crl.O.P.No.24879 of 2000 filed by the petitioners for quash of proceedings was dismissed as not pressed on 15.07.2002.


4. Heard the learned counsel for the petitioners as also the learned Government Advocate (Crl.Side).


5. The 1st ground taken by the learned counsel for the petitioners is upon construction of Section 32 of the Act which reads as follows:


"Offence by companies, etc. - Where a person committing an offence under this Act is a company, or other body corporate, or an association of persons (whether incorporated or not), every director, manager, secretary, agent or other officer or person concerned with the management thereof shall, unless he proves that the offence was committed without his knowledge or consent, be deemed to be guilty of such offence."


The learned counsel would submit that this provision is akin to Section 141 of the Negotiable Instruments Act which reads as follows:


"141. Offences by companies.-


(1) If the person committing an offence under Section 138 is a company, every person who, at the time the offence was committed, was incharge 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 person liable to punishment if he proves that the offence was committed without his knowledge, or that he had exercised all due diligence to prevent the commission of such offence:


[Provided further that where a person is nominated as a Director of a company by virtue of his holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government or the State Government, as the case may be, he shall not be liable for prosecution under this Chapter.]


(2) Notwithstanding anything contained in sub-section (1), where any 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."


6. The contention is that an averment to the effect that the petitioners were persons concerned with the management was absolutely essential. A closer reading of the rival provisions would show that under Section 32 of the Act, one would start with the presumption that the Managing Director or Director, Manager, Secretary, agent, or other officer, or person concerned with the management thereof would be liable, unless and until he proves that the offence was committed without his knowledge or consent. Under the Negotiable Instruments Act, one does not start with such a presumption. That is why, it is necessary to make a specific averment of a person being incharge of and responsible to the management, when an offence under Section 138 of the Negotiable Instruments Act is alleged and why such averment is not an absolute requisite when dealing with Section 32 of the Act.


7. The learned counsel would submit that the allegation of the petitioners having laid off workers without obtaining necessary permission was punishable under Section 25Q of the Act. The punishment attracted would be imprisonment for a term which may extend to one month, or with fine which may extend to Rs.1,000/-, or with both. Under Section 468 Cr.P.C., the limitation for filing a complaint in respect of an offence would be six months, if the offence was punishable with fine only, and one year, if the offence was punishable with imprisonment for a term not exceeding one year. The settlement arrived at and spoken to in the complaint was of the date 12.10.1995. If a compliant for offence under Section 25-M of the Act was to be made in respect thereof, the said complaint ought to have filed on or before 12.10.1996. In the instant case, the complaint has been filed only on 25.06.1999 and as such, the complaint in respect of such offence ought not to have been taken on file by the lower Court.


8. As regards the offence of non-payment of sums agreed upon to the workers and the attraction of offence under Section 29 of the Act which provides for penalty for breach of settlement and award, the submission is two fold:


The first contention is that the punishment, if such offence be committed, would be imprisonment for a term which may extend to six months or with fine or with both, which fine may be enhanced in the case of continuing offences. The breaches complained of in the present case are not in the nature of continuing offences and were merely, those, which called for compliance by the 1st petitioner company, as an one time affair.


In this regard, reliance was placed on the decision of the Calcutta High Court in M/s.Swaranjit Singh and others v. State and another (1986) LAB.I.C.1123 wherein a distinction has been drawn between awards which decide questions under reference once and for all and which cast a continuing obligation on the parties bound by the awards. The relevant extract would be as follows:


"4. .....It is not disputed that the award was made on 29.9.1970 and was published on 23.11.1970. Under S.17A(1) of the Act, the award shall become enforceable on the expiry of 30 days from the date of its publication under S.17 of the Act. Sub-sec. (3) to S.19 of the Act is to the effect that an award shall, subject to the provisions of S.19, remain in operation for a period of one year from the date on which the award becomes enforceable under S.17-A of the Act. The contention of Mr.Ghosh is that this provision in S.19(3) of the Act about the operation of the award for a period of one year from the date of its enforceability under S.17A of the Act cannot apply in the present case inasmuch as the award was for reinstatement with direction for payment of back-wages and did not cast any continuing obligation on the petitioners bound by the award. I am to accept this contention of the learned Counsel for the petitioners. There are two types of awards. The awards of the first type decide the questions under reference once and for all.These awards are awards involving personal rights, such as awards directing payment of money or upholding the discharge of dismissal of workmen or directing reinstatement of a discharged or a dismissed workman. The awards of the second type are awards which cast a continuing obligation on the parties bound by the awards, such as awards dealing with wage structure, paid holidays, dearness allowance, gratuity and other allowances and benefits. (See Indian Aluminium Co. Ltd. v. Their Workmen, (1958) 2 Lab LJ 403 : (AIR 1959 Ker 37); Md.Siddiq v. Raghunath Singh,(1979)39 Fac LR 342 : (1979 Lab IC 876) (Raj)."


The second contention is that the compliant alleges offence under Section 29 r/w.31 of the Act. Section 31 would stand attracted when there was a contravention of provisions of Section 33 of the Act. Section 33 of the Act stipulated that the conditions of service, etc. were to remain unchanged under certain circumstances during the pendency of conciliation proceedings. The contention of the learned counsel is that there is no averment whatsoever in the compliant regarding the pendency or otherwise of any conciliation proceeding. Unless a violation is spelt out during the p

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endency of a conciliation proceeding, no question of attraction of Section 31 of the Act would arise. 9. On the above submissions, the learned counsel seeks to quash the proceedings pending in C.C.No.1166 of 1999 on the file of the learned Judicial Magistrate, Mettupalayam. 10. Considering the above submissions as also the submissions of the learned Government Advocate (Crl.Side) in answer there to and on perusal of the material on record, this Court is of the view that the petition deserves to be allowed both on the ground of limitation as also for want of necessary averments towards attracting the application of Section 31 of the Act. Finding merit in the submissions of the learned counsel for the petitioners, this Court allows the Criminal Original Petition. 11. Accordingly, the Criminal Original Petition is allowed. The proceedings in C.C.No.1166 of 1999 on the file of the learned Judicial Magistrate, Mettupalayam shall stand quashed. Consequently, the connected miscellaneous petition is closed.
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