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1945 DIGILAW 17 (ALL)

Emperor v. Raghubar Singh

1945-01-19

GHULAM HASAN, THOMAS

body1945
JUDGMENT Thomas, C.J. and Ghulam Hasan, J. - These are two criminal revisions on behalf of the Provincial Government for enhancement of sentences passed by the City Magistrate of Lucknow on the 5th October, 1944 upon the three accused, sentencing each of them to four months' simple imprisonment and a fine of Rs. 1,000 in default to undergo a further period of two months' simple. imprisonment, in each of the two cases. The sentences were concurrent. 2. The material facts for the purposes of the revision applications may be shortly stated. Thakur Raghubar Singh and Kunwar Surendra Bahadur Singh were Directors and Managing Agents and Shiam Singh Rohatgi was General Manager of the All India United Assurance Company Limited (now under liquidation). These persons were the original promoters of the Insurance Company. The head office of the company was at Lucknow. They were prosecuted upon a complaint lodged by the Public Prosecutor at Lucknow u/s 104 of the Insurance Act (IV of 1938), the complaint being that they had made false statements knowing them to be false in the reports and accounts for the period ending on the 15th May and the 31st December, 1939, to the effect that they had contributed Rs. 30,000 to the Company and this amount was shown in the assets of the Company and that a certain sum of money was falsely shown in the bank under the heading "Cash, cheque and bank balance," although there was no such bank balance. They were convicted by the City Magistrate of Lucknow and each sentenced to six months' rigorous imprisonment and a fine of Rs. 500. Their appeal was dismissed by the Sessions Judge and a revision lo this Court was dismissed on the 10th August, 1943, by Mr. Justice Bennett (vide Raghubar Singh v. King-Emperor 1943 OA 214 : OW N 339) Upon a. certificate granted by the learned Judge u/s 205 of the Government of India Act of 1935 the Federal Court set aside the convictions and sentences upon the ground that there was no valid sanction to the initiation of the proceedings vide Thakur Raghubar Singh v. King Emperor 1914 OA (FC) 15 : AWR (FC) 15. 3. 3. Two complaints were then filed against the three accused, one u/s 35 of the Old Insurance Act No. VI of 1912 now repealed by Act IV of 1938 and the other u/s 104 of the new Act. The new Act did not come in force until the 1st July, 1939, and as the offence had been committed before that date namely May 1939, there can be no doubt that the accused could be legally prosecuted u/s 35 of the old Act. .The charges u/s 35 of the old Act and Section 104 of the new Act may lie reproduced as under : That you accused No. 1 being the general manager and you accused Nos. 2 and 3 being the managing agents and directors of the All India United Assurance Company Ltd., now under liquidation, on or after the 15th May 1939 at Lucknow in the First .Valuation Report Ex. P-9 of the said Company for period ending 15th May 1939 a* document required by or for the purposes of the provisions of the Insurance (Act) No. VI of 191a, and signed by you, willfully made a statement false in material particulars, knowing it to be false, viz., you falsely stated therein (1)' that a contribution of Rs. 30,000 has been made by you and that this amount was shown in the then existing assests of the Company; (2) that Rs. 5,162-13-9 existed in the funds of the Company on 10th May 1939 under the head "Cash, cheque, and Bank Balances' and thereby committed an offence punishable u/s 35 of the Insurance Act VI of 1912 and within my cognizance and I hereby direct that you be tried on the said charge. That you accused No. 1 being the General Manager and you accused Nos. 2 and 3 being the managing agents and directors of the All India United Assurance Company Ltd. now under liquidation, on or after 3lst December 1939 at Lucknow in Ex. P-l and 2 the reports and accounts for the period ending December 31st, 1939, documents required by or for the purpose of the provisions of the Insurance Act No. IV of 1938, and signed by you willfully made a statement false ,in material particulars, knowing it to be false, viz., you falsely stated therein (1) that a contribution of Rs. P-l and 2 the reports and accounts for the period ending December 31st, 1939, documents required by or for the purpose of the provisions of the Insurance Act No. IV of 1938, and signed by you willfully made a statement false ,in material particulars, knowing it to be false, viz., you falsely stated therein (1) that a contribution of Rs. 30,000 has been made by you and that this amount was shown in the then existing assets of the Company; (2) that Rs. 4,571-15-9 existed in the fund of the Company on 31st December 1939 under the head "Cash, cheques and Bank Balances" and thereby committed an offence punishable u/s 101 of Insurance Act No. IV of 1938, and within my cognizance and I hereby direct that you be tried on the said charge. 4. All the three accused pleaded guilty to the charge. A number of questions were put to the accused and the answers showed that they admitted their guilt. Thakur Raghubar Singh also admitted that subsequent to the 11th May, 1989 and the 27th June, 1939, he* had earned Rs. 7,500 from the Company by way of pay, allowances and commission. Shiam Singh Rohatgi admitted having earned Rs. 9,009 and Surendra Bahadur Singh admitted having earned Rs. 8,500. The learned City Magistrate, besides recording the plea of guilty, also took the evidence of the Liquidator of the Company and the Accountant. He held that as a result of the operations conducted by the three accused the Company's assets were falsely swelled by Rs. 30,000 and the Company's credit under the head of "Cash, cheque and bank balances" was falsely swelled by 'Rs, 5,000 and accordingly the three accused made statements wilfully and knowingly in Ex. P-9, a document signed by all the accused in their official capacities and published and submitted to Government under the Act. As a result, of the finding the learned City Magistrate sentenced each of the accused to four months' simple imprisonment and a tine of Rs. 1,000. He awarded a similar sentence in the complaint u/s 104 of Act No. IV of 1938 and made the two sentences run concurrent. As a result, of the finding the learned City Magistrate sentenced each of the accused to four months' simple imprisonment and a tine of Rs. 1,000. He awarded a similar sentence in the complaint u/s 104 of Act No. IV of 1938 and made the two sentences run concurrent. In awarding the sentences the learned City Magistrate took into consideration the fact that the accused had pleaded guilty and accepted full responsibility for their acts and further they had been put to considerable worry and expense in taking their case up to the Federal Court. The revisions challenge the adequacy of the sentences. 5. An affidavit has been, filed before us on behalf of the accused to show that they were released on the 17th January after serving out their sentences. Normally their sentences were due to expire on or by the 5th of February but we understand from the affidavit that the accused voluntarily undertook to do labour although they were sentenced to simple imprisonment and thus earned some remission in their sentences. 6. The learned Government Advocate has argued that the action of the accused was a fraud upon the Insurance Law and a deterrent sentence was called for to prevent the perpetration of frauds in future by Company promoters. On-behalf of the accused it has been urged that the accused having paid their fines and served out their sentences of imprisonment, it would be hard to commit them to jail again. In this connection it has been contended that the applications for enhancement .of sentences were filed as late as the 9th January, 1915, when the sentences of the accused were about to expire. It is true that the applications were made late but we do not think that in the circumstances of this case they constituted any insuperable bar to the enhancement of the sentences. -This position is conceded in Emperor v. Parbhu Upadhaya AIR 1925 Pat 201 and AIR 1934 613 (Lahore) . 7. Next it has been contended that the Magistrate has given adequate reasons for the- sentences which he passed and this Court should be slow to enhance any sentence when it has not been shown that the sentence was either manifestly inadequate or has otherwise resulted in a miscarriage of justice. A reference is made to AIR 1932 199 (Lahore) and Hla San v. The King AIR 1942 Rang 49. A reference is made to AIR 1932 199 (Lahore) and Hla San v. The King AIR 1942 Rang 49. The principles laid down in these cases are not open to any reasonable exception but the circumstances of these cases bear no analogy to the circumstances of the present case. It is clear that there are two cases, one u/s 35 of the did Act and another u/s 104 of the new Act. There is no doubt that the offences under the two sections arise oat of the same set of facts but the offences arc clearly distinct. The offence u/s 35 is punishable with imprisonment for a term which may extend to two years, or with fine, or with both. Section 101 imposes a punishment which- may extend to three years or a fine which may extend to one thousand rupees or with both. Previously the accused were convicted only u/s 104 of the new Act and there was no prosecution u/s 36 of the old Act! It is true that the accused had made a clean breast of the whole affair, although they had questioned their previous conviction not only on the ground of want of sanction but also upon the merits. The accused made no contribution at alt to the assets of the Company and represented falsely that they had done so with the deliberate object of deceiving the public. They also appropriated the amounts admittedly 'from the public funds. The sentence of four months' simple imprisonment bears no relation whatever, to the gravity of the offence committed by the accused. We are clearly of opinion that when frauds such as these are brought to light, .the "public has a right to protection against their repetition and deterrent sentences are called for. 8. Accordingly we hold that the sentences passed by the-City Magistrate are grossly inadequate and do not satisfy the ends of justice, We, therefore; allow the revision applications and compose a sentence of one year's rigorous imprisonment upon each of the accused under each of the offences u/s 35 of the Indian Life Assurance Companies Act (VI of 1912) and under Section'104 of the Insurance Act (IV of 1938). We,3mintain ,, the fines already imposed. The sentences under the two sections shall run consecutively. These sentences will commence to run from today. We,3mintain ,, the fines already imposed. The sentences under the two sections shall run consecutively. These sentences will commence to run from today. In computing these sentences no regard shall be paid to the previous sentences of simple imprisonment which the accused have served out.