Case : Director of Writer Safeguard Pvt Ltd vs Labour enforcement officer
Appellant : Director of Writer Safeguard Pvt Ltd
Respondent : Supreme Court
Today we are going to discuss an interesting case where Supreme court has directed prosecuting agencies not to take any actions against directors of the companies merely because of their position.
Facts: In this case summons were issued against the director of Writer Safeguard Pvt Ltd which failed to pay minimum wages to some workmen as it has entered into agreement with NCR Corporation India Pvt Ltd for providing services related to ATM machines. Later on it was noticed by labour enforcement officer which inspected and issued a notice alleging non compliance under Minimum Wages Act 1948.
Provision: In this case section 22C of Minimum Wages Act is applicable, which states that if any offence is committed by a company or a person responsible of such offence shall be guilty of such offence and shall be held liable and prosecuted.
Analysis: Further Supreme Court said that vicarious liability would be attracted only when the offence was directly attributable to the neglect on the part of the director, manager, secretary, or any other officer of the company.
Judgment: Hence Supreme Court quashed all charges held against the director of the company.
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