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CS Professional · Intellectual Property Rights - Law and Practice · Trademarks

Sundar Sweets Pvt Ltd is held to have committed an offence under the Trade Marks Act. Rajan, a director, proves that the offence was committed without his knowledge. Under the provisions on offences by companies, what is the result for Rajan?

Rajan is not liable to punishment. Under the proviso to the provision on offences by companies, a person in charge of the company's business escapes liability if he proves the offence was committed without his knowledge or that he exercised all due diligence to prevent it.

  1. AHe is liable regardless, since every director is automatically guilty
  2. BHe is not liable to punishment under the proviso, because he proved lack of knowledgeCorrect
  3. CHe is liable only to a fine, not imprisonment
  4. DHe is liable unless the company is dissolved

Explanation

Section 114(1) deems the company and every person in charge of and responsible for its business at the time to be guilty. The proviso exempts such a person who proves the offence was committed without his knowledge or that he exercised all due diligence. Rajan proved lack of knowledge, so he escapes punishment under that provision. Section 114(2) would still apply to any officer whose consent, connivance or neglect is proved.

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