The Bombay High Court (Nagpur Bench) has held that, in cases involving hazardous industries, where prior statutory deficiencies were pointed out and remained unremedied, and workers were allegedly made to handle hazardous material without proper training, a prima facie case under Section 105 of the BNS can arise on the basis of knowledge and illegal omission, even if the accused were not physically present at the spot and even though criminal liability is not being fastened on the principle of vicarious liability.
The Court further held that independent directors stand on a different footing, because under Section 149(12) of the Companies Act, 2013 their liability does not arise merely by designation and requires material showing knowledge attributable through board process, consent, connivance, or lack of due diligence. On that basis, anticipatory bail was granted to the independent directors and rejected for the Managing Director, CEO/Director, Safety Officer and other Directors.
A Single Judge Bench of Justice Rajnish R. Vyas observed that at the anticipatory bail stage, the question was not whether the applicants were vicariously liable, but whether the averments in the FIR and the material on record prima facie made out the offences against them. The Bench found that the factory was dealing with a hazardous process, and that an earlier incident had also taken place in which workers were injured, yet the Managing Director, Directors and Safety Officers did not seriously address the deficiencies pointed out by the Directorate of Industrial Safety and Health (DISH).
The Bench noted that statements of workers showed that they were never given training to handle hazardous goods or substances. Thus, the Bench observed that merely because the DISH communication was addressed to the Factory Manager, it could not mean that the applicants could not be named as accused, and that while the Factories Act deals with regulatory breaches, the FIR invoked penal offences under the BNS.
The Bench further observed that, under the BNS, “act” includes omission, and words referring to acts done extend also to illegal omission. It held that handling hazardous substances without proper precautions and requiring untrained workers to perform such work could not be treated as a lawful act done with proper care and caution.
As regards the Deputy Manager (Safety), the Bench observed that he was duty-bound under the Maharashtra Safety Officer Rules, 1982 to advise and assist the Factory Manager in preventing personal injuries and maintaining a safe working environment, and that his travel on the date of the incident was not sufficient to justify anticipatory bail.
The Bench accepted the contention of the independent directors that criminal liability does not arise solely from their designation, and that by virtue of Section 149(12) of the Companies Act, liability would arise only where the act or omission occurred with their knowledge attributable through board process and with consent, connivance, or lack of due diligence. The Bench however, refused to consider, in favour of the other applicants, the report allegedly showing deficiencies had been fulfilled, since the applicants themselves admitted that it was submitted after the incident. It also held that private defence documents relied upon by certain directors could not be considered while deciding anticipatory bail.
The Bench held that in hazardous industries, persistent statutory non-compliance even after prior notice transforms omission into culpable conduct, attracting criminal liability beyond mere negligence, and that liability in the present case was not vicarious but arose from prima facie knowledge, statutory duty, and continued omission. The Bench also reiterated that lack of requirement for custodial interrogation by itself cannot be a ground to grant anticipatory bail, and that the first and foremost consideration is the prima facie case against the accused.
Briefly, the anticipatory bail applications under Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023 arose out of FIR registered at Kalmeshwar Police Station, District Nagpur (Rural), for offences under Sections 105, 125(a), 125(b) and 288 of the Bharatiya Nyaya Sanhita, 2023, in relation to an explosion at factory Shed No. 16-B of SBL Company situated at Rahulgaon Shivar. The applicants held different positions in the company, including Managing Director, CEO/Director, Non-Executive Independent Directors, Independent Director, Deputy Manager (Safety), and Directors.
The FIR records that, on preliminary enquiry, 17 workers had died and 24 workers had sustained grievous or simple injuries in the explosion, and the authorities sought reports from the Chief Controller of Explosives and DISH regarding the cause of the explosion. The reasons and deficiencies referred to in the FIR included failure to take special precautions to avoid accident, explosion or fire, failure to immediately remove explosives from the building, and several statutory non-compliances such as non-conduct of risk assessment, non-provision of fire trailer pump, appointment of only one safety officer instead of two, non-appointment of factory medical officer, non-submission of leave with wages records, non-installation of flameproof CCTV, non-submission of internal safety audit, partial medical health check-up coverage, and non-submission of training records to DISH.
The prosecution case was that the accused persons, despite knowledge of the directions and deficiencies pointed out by DISH and PESO, continued the work in the company though they knew that non-compliance could result in loss of human life. The applicants argued, inter alia, that they were not present at the spot, had no knowledge of the deficiencies, and that under the Factories Act responsibility lay with the occupier and not every Director, Managing Director or employee. The independent directors additionally relied on Section 149(12) of the Companies Act, 2013.
Appearances:
Senior Advocate Mahesh Jethmalani and Pranav P. Badheka, along with Advocates Aditya Chaudhari, Prafull Kumar, Ravi Sharma, Anjali, and Amol Mardikar, for the Applicant
APP A.M. Ghogare, for the Respondent/ State
