Complaint Filed Beyond Limitation Period: Jharkhand High Court Quashes Criminal Proceedings Against Alembic Pharmaceuticals

 “Lack of Specific Averments on Officials’ Roles and Expired Limitation Period Key in Dismissal, Rules Court.” The High Court of Jharkhand has quashed criminal proceedings against Alembic Pharmaceuticals Limited and its officials, citing the expiration of the statutory limitation period and insufficient specific averments regarding the petitioners’ involvement in the company’s day-to-day affairs. The judgment, delivered by Justice Sanjay Kumar Dwivedi on May 13, 2024, underscores the importance of adhering to procedural timelines and detailed pleadings in corporate liability cases.

The case originated from a complaint filed by the Bihar and Jharkhand Sales Representative Union, alleging that Alembic Pharmaceuticals failed to comply with statutory requirements under the Sales Promotion Employees (Condition of Service) Act, 1976. The complaint, filed on November 28, 2017, pointed to irregularities such as the non-maintenance of Form A (Appointment Letter) and other essential documents as per the Act. The petitioners sought to quash the entire criminal proceedings, arguing that the complaint was barred by limitation and lacked specific allegations regarding their roles in the company’s daily operations.

Limitation for Cognizance: Justice Dwivedi emphasized the importance of adhering to the limitation period stipulated under Section 11(2) of the Sales Promotion Employees Act, which mandates that complaints must be filed within six months of the alleged offence. The court observed, “The complaint was filed after the limitation period without any condonation application. Hence, the cognizance taken by the trial court was not in accordance with the law.” The court referenced the Supreme Court’s decision in P.P. Unnikrishnan and Another v. Puttiyottil Alikutty and Another, reinforcing that Section 473 of the Cr.P.C. does not apply to extend limitation periods prescribed under special statutes.

Responsibility of Officials: Section 10 of the Sales Promotion Employees Act requires specific averments detailing the involvement of company officials in the day-to-day affairs to hold them liable. The court noted, “There is no single averment in this petition that these petitioners are looking after the day-to-day affairs of the company.” The absence of such detailed pleadings rendered the complaint insufficient to sustain the charges against the petitioners.

The court underscored the procedural requirements for taking cognizance of offences under special statutes. It highlighted that compliance with statutory forms and maintenance registers was crucial but should be alleged with specific details linking the accused to the alleged non-compliance. The court stated, “Prima facie, it appears that there is no violation of sections 5 and 7 of the Sales Promotion Employees Act, 1976, as the company maintained necessary registers and the appointment letter format allowed for additional service conditions.”

Justice Dwivedi remarked, “Allowing the present proceeding to continue further will amount to abuse of process of law,” emphasizing the court’s stance on preventing misuse of legal procedures.

The High Court’s decision to quash the criminal proceedings against Alembic Pharmaceuticals and its officials highlights the judiciary’s commitment to procedural precision and fair play in corporate liability cases. By underscoring the necessity of adhering to limitation periods and providing detailed averments, this judgment sets a significant precedent for future cases involving corporate non-compliance allegations.

Date of Decision: 13^th May 2024

M/s Alembic Pharmaceuticals Limited & Ors. V. The State of Jharkhand & Ors.