2026 (3) TMI 98 - SC - Indian Laws

Limitation and public servant complaints: cognizance valid when identity is established and investigative material supports prima facie case.

Limitation for the offence under the Drugs and Cosmetics Act began when the offender's identity was established during the authority's investigation, so ... Limitation for taking cognizance under Sections 468 and 469 read with Section 473 of the Code of Criminal Procedure - Territorial jurisdiction - postponement of issue of process under Section 202 of the Code of Criminal Procedure and its interplay with Section 200 - status of complaints filed by public servants and the proviso to Section 200 CrPC - cognizance by an Inspector under Section 32 of the Drugs & Cosmetics Act - vicarious liability of companies and persons in charge under Section 34 of the Drugs & Cosmetics Act Limitation for taking cognizance under Sections 468 and 469 read with Section 473 of the Code of Criminal Procedure - Whether the complaint was barred by limitation or was filed within the period prescribed by Sections 468 and 469 read with Section 473 CrPC - HELD THAT: - The Court held that the period of limitation commences under Section 469(1)(c) when the identity of the offender becomes known to the competent authority or investigating officer. The sequence of verification/investigation by the Drugs Inspector, commenced after the private complaint, resulted in the identity of the accused being established on 18.04.2006; hence the limitation period for the offence punishable under Section 27(d) of the Act (attracting three years under Section 468(2)(c)) ran from that date. Although the formal complaint was filed on 20.01.2009, the Court found that the exercise culminating in identification was completed within three years and therefore the bar of limitation did not apply; the High Court erred in treating limitation as having commenced from 21.10.2005. [Paras 31, 33, 36, 37] Limitation did not bar cognizance; the appeal is allowed on this point and the High Court's computation of limitation from 21.10.2005 is set aside. Postponement of issue of process under Section 202 of the Code of Criminal Procedure and its interplay with Section 200 - status of complaints filed by public servants and the proviso to Section 200 CrPC (as applied in Cheminova) - cognizance by an Inspector under Section 32 of the Drugs & Cosmetics Act - Whether the Magistrate was bound to postpone issuance of process under Section 202(1) CrPC and conduct the statutory inquiry where the complaint was filed by a public servant Inspector - HELD THAT: - The Court construed Section 202(1) harmoniously with Section 200 which exempts examination of complainant and witnesses when a public servant acting in official duty has made the complaint. Relying on the principle recognised in Cheminova [2021 (8) TMI 1402 - SUPREME COURT], the Court held that complaints filed by authorised public servants (here, the Drugs Inspector acting under Section 32 of the Act) stand on a different footing and do not mandatorily attract an inquiry under Section 202(1) in the manner contended by the respondents. The facts showed that the complainant was an Inspector authorised to institute prosecution under the Act and that the accused who sold the medicine to the private purchaser resided within the Magistrate's local limits; having regard to these circumstances and the established precedent, the High Court's quashing for non-compliance with Section 202 was incorrect. [Paras 38, 39, 40, 41, 43] The High Court was wrong to quash the complaint on the ground of non-compliance with Section 202(1); the order taking cognizance and issuing summons is held to be valid. Vicarious liability of companies and persons in charge under Section 34 of the Drugs & Cosmetics Act - Whether the Directors alleged to be in charge of the company could be charged as persons liable under Section 34 of the Act at the stage of quashing proceedings - HELD THAT: - The Court observed that whether the Directors were 'in charge of' and 'responsible to the company for the conduct of the business of the company' are questions of fact. It held that the High Court's conclusion on Section 34 was premature at the quashing stage. Such factual determinations must be left to the trial court for evidence and appropriate adjudication. [Paras 54, 57, 59] The High Court's quashing on the ground of insufficient compliance with Section 34 was set aside; questions of vicarious liability are to be decided by the trial court. Final Conclusion: The appeals are allowed; the High Court's order quashing the complaint is set aside. The Order taking cognizance and issuing summons is upheld as valid; fresh summons shall be issued and, where necessary, the person(s) in charge of the respondents' companies at the relevant time shall be arrayed as accused in place of the deceased Managing Director. The trial court shall proceed to decide the factual issues, including those under Section 34 of the Act, in accordance with law. Issues: (i) Whether the complaint and subsequent cognizance were barred by limitation under Sections 468 and 469 read with Section 473 of the Code of Criminal Procedure, 1973; (ii) Whether the learned Magistrate was obliged to conduct the inquiry/investigation under Section 202 of the Code of Criminal Procedure, 1973 when the complaint was filed by a public servant (Drugs Inspector) and the accused resided beyond the Magistrate's territorial jurisdiction.Issue (i): Whether the complaint and subsequent cognizance were barred by limitation under Sections 468 and 469 read with Section 473 of the Code of Criminal Procedure, 1973.Analysis: The limitation period for the offence under Section 27(d) of the Drugs and Cosmetics Act, 1940 is governed by Section 468(2)(c) of the Code and the commencement rules in Section 469. Section 469(1)(c) applies where the identity of the offender became known during investigation; the Court examined the documentary and investigative timeline and found that the identity of the accused was established only on 18.04.2006 and the formal complaint was filed on 20.01.2009. The Court applied Section 473 to assess whether delay was explained and considered the sequence of verification and investigation undertaken by the Competent Authority (Drugs Inspector).Conclusion: The limitation bar did not prevent taking cognizance; the limitation period commenced under Section 469(1)(c) when the identity of the accused became known and cognizance taken on 29.01.2009 fell within the three-year period. Conclusion in favour of the Appellants.Issue (ii): Whether the learned Magistrate was obliged to conduct the inquiry/investigation under Section 202 of the Code of Criminal Procedure, 1973 when the complaint was filed by a public servant and the accused resided beyond the Magistrate's territorial jurisdiction.Analysis: Section 202(1) requires postponement of the issue of process and an inquiry/investigation where the accused resides beyond the Magistrate's jurisdiction, subject to provisos including Section 200 which exempts examination of a complainant who is a public servant acting in discharge of official duty. The Court considered this scheme and precedent (Cheminova India Limited) holding that complaints by public servants occupy a different footing; Section 202 must be read harmoniously with the proviso to Section 200 in the context of complaints filed by authorised Inspectors under Section 32 of the Drugs and Cosmetics Act, 1940.Conclusion: The Magistrate's taking of cognizance without conducting a separate Section 202 inquiry was sustainable in the factual context where the complainant was an Inspector acting in official capacity and investigative material supported prima facie grounds. Conclusion in favour of the Appellants.Final Conclusion: The Impugned Order quashing the complaint is set aside, the Order taking cognizance and issuing summons is held good in law, and fresh procedure shall be followed to array substituted persons where necessary and issue fresh summons; the appeals are allowed accordingly.Ratio Decidendi: Where a complaint is filed by a public servant authorised under the relevant statute and investigative material establishes the identity of accused within the limitation period, Sections 200 and 202 of the Code of Criminal Procedure, 1973 must be read harmoniously and the Magistrate need not conduct the Section 202 inquiry as a mandatory precondition to taking cognizance.