Criminal Liability of Company Nominees in Food Adulteration Cases: Supreme Court Verdict

The case of Hindustan Unilever Limited versus the State of Madhya Pradesh revolved around the criminal liability of a company and its nominated officer under the Prevention of Food Adulteration Act, 1954. The core issue was whether the company’s nominated officer, Dr. Nirmal Sen, could be held criminally liable without the company being convicted.

Background of the Case

On February 7, 1989, a sample of Dalda Vanaspati Khajoor Brand Ghee was taken from a godown of Lipton India Limited. The sample was found to be adulterated as it had a melting point of 41.8 degrees Celsius, higher than the prescribed range of 31-41 degrees. This led to the prosecution of Hindustan Unilever Limited and its nominated officer, Dr. Nirmal Sen, under the 1954 Act.

Legal Proceedings and Arguments

• The trial court convicted Dr. Nirmal Sen, but the company was not convicted.
• On appeal, the High Court found procedural defects and remanded the case for reconsideration.
• The Supreme Court noted that under Section 17 of the Prevention of Food Adulteration Act, both the company and its nominated officer should be prosecuted together.
• The Court ruled that without the company being convicted, the conviction of the nominated officer could not be sustained.

Supreme Court’s Decision

The Supreme Court held that the failure of the trial court to convict the company made the conviction of the nominated officer unsustainable. The Court emphasized that criminal liability under the Act must be jointly established against both the company and its responsible officer. The conviction was set aside, and the complaint was dismissed.

Conclusion

This judgment reaffirms the principle that companies and their nominated officers must be prosecuted together for corporate criminal liability to hold. It sets a significant precedent for similar cases under food adulteration laws and corporate liability.

Petitioner Name: Hindustan Unilever Limited.
Respondent Name: The State of Madhya Pradesh.
Judgment By: Justice L. Nageswara Rao, Justice Hemant Gupta, Justice Ajay Rastogi.
Place Of Incident: Madhya Pradesh.
Judgment Date: 05-11-2020.

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