Supreme Court: Chairman, directors, and other key managerial personnel of a company cannot be automatically held vicariously liable for the offences committed by a company.
The Hon'ble Supreme Court (“SC”) in Ravindranatha Bajpe v. Mangalore Special Economic Zone Limited and Others (decided on September 27, 2021), held that the chairman, directors, and other key managerial personnel of a company cannot be automatically held vicariously liable for the offences committed by a company unless specific allegations and averments against them are made with respect to their individual role. Facts Ravindranatha Bajpe (“Appellant/Complainant”), the original complainant, filed a private complaint against thirteen accused (accused nos. 1 to 13) in the Court of the learned Judicial Magistrate, First Class, Mangalore (“Magistrate”). The Complainant was the absolute owner and in possession and enjoyment of the certain immovable property (“Schedule Properties”). Accused nos. 1 and 6 were companies incorporated under the Companies Act and accused nos. 2, 3 and 4 were the Chairman, Managing Director and Deputy General Manager (Civil & Env.) of accused no. 1,