Vicarious criminal liability of directors requires specific averments that the director was in charge of company business at the relevant time

Criminal prosecution for a company offence under the Customs Act cannot continue against a director unless the complaint and supporting material specifically plead that she was in charge of and responsible for the company's business at the relevant time. Here, the complaint lacked any specific allegation of active involvement in day-to-day affairs, and the material indicated that the husband was managing the business while the petitioner was only a director. The court therefore treated the foundational requirements for vicarious liability as absent and held that continuation of the criminal process was unwarranted. The inherent jurisdiction was properly exercised to quash the proceedings against the petitioner.

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Issues: Whether criminal proceedings under the Customs Act could be quashed against a company director in the absence of specific averments showing that she was in charge of and responsible for the conduct of the company's business at the relevant time.

Analysis: Liability under the company offence provision depends on a person being in charge of and responsible for the conduct of the business when the offence was committed. The complaint contained no specific allegation of the petitioner's active participation in day-to-day affairs, and the material before the customs authority indicated that the husband was managing the business while the petitioner was only a director. The adjudication order also recorded that she looked after the affairs of the company much later and that no penalty was warranted against her. On these facts, continuing prosecution would amount to subjecting a sleeping director to criminal process without the foundational allegations required by law.

Conclusion: The prosecution against the petitioner was liable to be quashed.

Final Conclusion: Inherent jurisdiction was properly exercised to terminate the criminal case against the petitioner because the complaint did not establish the statutory basis for her vicarious liability.

Ratio Decidendi: A director cannot be prosecuted for a company offence unless the complaint and supporting material specifically show that she was in charge of and responsible for the company's business at the relevant time.

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