Chairman, MD, ED can't be summoned without specific allegations: SC
New Delhi: "Chairman/Managing Director/Executive Director/Deputy General Manager/Planner & Executor of a company cannot be summoned in a criminal case unless there are specific allegations," the Supreme Court said recently while adding that they cannot be vicariously held liable for
the criminal acts of the company.
The top court said that the magistrate has to record satisfaction about a prima facie case against an accused to summon him in a court.
"Issuing summons/process by the Court is a very serious matter and therefore unless there are specific allegations and the role attributed to each accused more than the bald statement, the Magistrate ought not to have issued the process," a bench of Justices M R Shah and A S Bopanna said.
The observations came while deciding an appeal by a man who had lodged a complaint against a company, its director, and other functionaries alleging offences punishable under...
Sections 406 (criminal breach of trust), 418 (Cheating with knowledge that wrongful loss), 420 (cheating), 427 ( Mischief causing damage to the amount of fifty rupees), 447 (criminal trespass), 506 ( criminal intimidation) and 120B (criminal conspiracy) read with Section 34 (common intention) of Indian Penal Code.
The trial court issued the process against the accused. Later, the sessions court set aside the order, and the same was upheld by the High Court.
The apex court said an accused cannot be held vicariously liable unless there are specific allegations and averments against the person. The top court in its judgement said the order passed by the Magistrate issuing the process against the accused, there does not appear that the learned Magistrate has recorded his satisfaction about a prima facie case.
Merely because respondent Nos. 2 to 5 and 7 & 8 are the Chairman/Managing Director/Executive Director/Deputy General Manager/Planner & Executor, automatically they cannot be held vicariously liable, unless, as observed hereinabove, there are specific allegations and averments against them with respect to their individual role. Under the circumstances, the High Court has rightly dismissed the revision applications and has rightly confirmed the order passed by the Session's Court, the bench said.
