Company prosecution and specific averments of control are required before vicarious liability can attach to a director.

A complaint alleging offences in the course of a company's business under the Payment of Bonus Act was held unsustainable when the company itself was not prosecuted and only the Managing Director was named. The court reasoned that the employer was the company, which has separate legal existence, so primary prosecution should lie against the company before liability is extended to persons in charge. It also held that vicarious liability cannot be invoked unless the complaint specifically pleads that the accused was, at the relevant time, in charge of and responsible for the conduct of the company's business. In the absence of that averment, the proceedings were quashed.

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Issues: (i) Whether a complaint for offences committed in the course of a company's business under the Payment of Bonus Act can be maintained against a director alone without prosecuting the company. (ii) Whether, to fasten liability on a person in charge of a company, the complaint must specifically allege that he was in charge of and responsible for the conduct of the company's business.

Issue (i): Whether a complaint for offences committed in the course of a company's business under the Payment of Bonus Act can be maintained against a director alone without prosecuting the company.

Analysis: The liability for maintaining registers was cast upon the employer, and on the facts the employer was the company. Offences by companies were treated as primarily those of the company itself, and the statutory scheme contemplated prosecution of the company first, with liability extending to persons in charge only in addition. A director could not be equated with the company, which has a separate legal existence. The complaint was filed only against the Managing Director and not against the company.

Conclusion: The complaint against the director alone was not maintainable, and prosecution ought to have been launched against the company.

Issue (ii): Whether, to fasten liability on a person in charge of a company, the complaint must specifically allege that he was in charge of and responsible for the conduct of the company's business.

Analysis: The provision dealing with offences by companies required an allegation that the person proceeded against was, at the relevant time, in charge of and responsible to the company for the conduct of its business. Such an averment was a necessary foundation for criminal liability; proof at trial could arise only after the pleading existed. The complaint in question lacked this essential allegation, making the prosecution defective.

Conclusion: In the absence of a specific averment of responsibility and control, the complaint was unsustainable.

Final Conclusion: The proceedings were quashed because the company was not prosecuted and the complaint failed to contain the statutory foundation needed to proceed against the director.

Ratio Decidendi: Where an offence is alleged against a company, prosecution of the company is ordinarily necessary, and vicarious liability of a director or person in charge can be invoked only if the complaint specifically pleads that such person was in charge of and responsible for the company's business.

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