Sri Sirmander Das v. State — 1956 DIGILAW 383 (ALL)

JUDGMENT R.K. Chowdhry, J. - This is an accused's application in revision at an interlocutory stage. The applicant Srimander Das has been charged by a learned first class Magistrate of Saharanpur with an offence punishable u/s 409, IPC. His contention is that, on the facts alleged, no charge should have been framed against him u/s 254, Code of Criminal Procedure, but he should have been discharged u/s 253 of the Code. 2. The facts giving rise to the present revision were as follows. The applicant was at the relevant time the manager and partner of the Saharanpur branch of a joint Hindu family banking concern known as the Mansa Ram Bank. 3. It is said that on 31-5-1955 the opposite party Ram Chandra gave a sum of Rs. 4,400 to the Saharanpur branch of the bank for transmission to Dehli and he obtained a draft for that amount in the name of one Chhabil Das on the Central Bank of India Ltd. at Delhi. Likewise, Ram Chandra paid another sum of Rs. 3,500 in the said branch of the bank at Saharanpur on 3-6-1955 and obtained another draft in the name of the same person Chhabil Das, but this time on the Allahabad Bank Ltd. Delhi. Both the drafts were signed by the applicant as manager of the Saharanpur branch of the Mansa Ram Bank. The drafts in due course were endorsed by Chhabil Das in favour of one Behari Lal, presumably because the former had no Bank account in Delhi. Both these drafts were presented for payment by the endorsee Behari Lal, through the National Bank of Lahore, Delhi branch, at the aforesaid Delhi Banks, the first draft on 4-6-1955 and the second on 6-6-1955. Both the drafts were however dishonoured, the Central Bank doing so with the endorsement, "not arranged for" and the Allahabad bank with the endorsement "exceeds arrangement." In other words, in either case the respective sums of money covered by the two drafts were not paid to the endorsee. In the meanwhile, on 7-6-1955 the bank stopped payments and soon after certain customers of the bank applied for adjudication of the partners as insolvent. 4. On 10-6-1955 the opposite party Ram Chandra filed a complaint against the applicant giving rise to the present revision. In the meanwhile, on 7-6-1955 the bank stopped payments and soon after certain customers of the bank applied for adjudication of the partners as insolvent. 4. On 10-6-1955 the opposite party Ram Chandra filed a complaint against the applicant giving rise to the present revision. Upon taking some evidence the learned Magistrate framed a charge against the applicant on 17-3-1956 for an offence punishable u/s 409, IPC in respect of the aforesaid two transactions dated 31-5-1955. The applicant went up in revision against this framing of the charge to the learned Sessions Judge of Saharanpur, but the revision was rejected on 8-5-1956. The present revision was thereupon filed by the applicant on 22-6-1956 and, in the meanwhile, further proceedings were by an order of this Court stayed in the court of the trying Magistrate. The main argument put forward in this Court by the learned Counsel for the applicant, as adverted to already, was that on the facts alleged no case for an offence of Criminal breach of trust punishable u/s 409, IPC, had been made out. It was also urged that the allegations made against the applicant merely made out a civil case against him, and the criminal complaint was therefore misconceived. So far as the last point is concerned, it is shortly disposed of. There is a clear allegation in the complaint in the present case that whatever the applicant did was done by him dishonestly. Whether that was a correct allegation or not is another matter, but, on the allegations contained in the complaint, it is manifest that the complainant's case was that the applicant acted dishonestly. And that is a circumstance which distinguishes a civil from a criminal liability. The contention that the matter was purely of a civil nature therefore does not hold good. 5. Coming to the main allegation of the applicant, for the establishment of a case of criminal breach of trust within the provisions of Section 409, IPC, the prosecution has to prove the following facts: (1) That the accused is a public servant, or in the wry of business as a banker (which is the allegation in this case), merchant, factor, broker, attorney or agent; (2) That he was in such capacity entrusted with property (here money) or with dominion over the property; and (3) That he committed criminal breach of trust in respect of that property. 6. 6. Analysing the last ingredient in terms of the definition of criminal breach of trust, as given in Section 405. IPC, the prosecution must prove (a) that the accused has dishonestly misappropriated the property or converted it to his own use, or dishonestly used or disposed of that property, and (b) that he did so in violation of any direction of law prescribing the mode in which such trust is to be discharged, or (as appears to be the case here) of any legal contract, express or implied, which he has made touching the discharge of such trust. 7. Each of the aforesaid points is a matter of controversy in the present case. It is a matter of controversy whether the applicant was a banker within the intendment of Section 409. The prosecution allegation is that the bank was a joint Hindu family concern of which family the applicant was a member. On the contrary, it was contended on behalf of the applicant that he was merely a manager. Again, it was a matter of controversy whether the money could be said to have been entrusted to the applicant on the aforesaid two dates, 31-5-1955 and 3-6-1955, or, as contended on behalf of the applicant, whether the payment was made to certain other employees of the Saharanpur branch of the Bank and the applicant merely signed the drafts as a manager. It is again a matter of controversy whether the payments of the afore said sums of Rs. 4, 400/ - and Rs. 3, 500/ - amounted to entrustment within the definition of criminal breach of trust as contained in Section 405, IPC. As regards the ingredient of commission of criminal breach of trust by the applicant with regard to the aforesaid sums of money, there was a clear allegation in the complaint that the applicant had dishonestly misappropriated those amounts. The actual allegation in the complaint in regard to this point was that the accused dishonestly accepted the aforesaid sums aggregating Rs. 7,900/ - from the complainant and issued the two drafts to him despite the facts that he knew that he (or the bank, which was again a matte of controversy) had no money to his (or the bank's) credit in the two banks at Delhi on which the two drafts were drawn. 7,900/ - from the complainant and issued the two drafts to him despite the facts that he knew that he (or the bank, which was again a matte of controversy) had no money to his (or the bank's) credit in the two banks at Delhi on which the two drafts were drawn. And it would further appear to be the case of the complainant that the applicant acted in the manner alleged in the complaint in violation of a legal contract that had come into existence between the parties, namely, the contract that the applicant (or the bank, as the case may be) held money in the two Delhi banks sufficient to meet the drafts and that the drafts would thus be honoured when presented for payment there. 8. The main question round which controversy centered in the present revision in this Court related to (1) whether the applicant was entrusted with the sums of money in question and (2) whether the transactions conducted on the aforesaid two dates amounted to entrustment. Reference has already been made to the difference between the parties on the first point. So far as the second point is concerned, and that is the main point convassed at the bar, the learned Counsel for the applicant cited three rulings for and one against his contention- the contention, that is, that the payments of the two sums of money did not amount entrustment. The three rulings cited by him in support of his contention were Jodha Ram v. State 1951 AWR (H.C.) 85, State v. Tirath Das AIR 1954 Alld 583 and the English case of Folly v. Hill (1848) 2 HLC 28. The ruling referred to(sic)y him as appearing to hold the opposite view, but distinguished by the learned Counsel on the facts of the present case, was the ruling reported as an The Matter of the Indian Companies Act of 1913 and of the New Bank of India Ltd. AIR 1949 East Pun. 373. All these decisions were considered by the court below. The decisions cited by the learned Counsel for the applicant as supporting the view propounded by him were distinguished by the learned Sessions Judge, and the decision of the East Punjab High Court was relied upon as applying to the facts of the present case. 9. 373. All these decisions were considered by the court below. The decisions cited by the learned Counsel for the applicant as supporting the view propounded by him were distinguished by the learned Sessions Judge, and the decision of the East Punjab High Court was relied upon as applying to the facts of the present case. 9. Now, it is well established that entrustment within the purview of the definition of criminal breach of trust, as contained in Section 405, IPC implies transference of possession of property for some purpose in accordance with the directions of the transferor, proprietary rights in the property continuing to vest in the transferor. When there are money dealings between a bank and its customer the question generally arises whether the transaction amounts to a deposit or to a bailment for a specific purpose. In the former case there arises a relationship of debtor and creditor between the bank and the customer and the money becomes the bank's money, only to be repaid when demanded. In the latter case, proprietary rights in the money remain with the customer and there comes into being a trust in the hands of the bank with regard to the disposal of the money in accordance with the terms of the contract between the parties. Naturally therefore there could be no question of the commission of the offence of criminal breach of trust in the former case inasmuch as the money in question becomes the bank's money and no trust in regard to it arises. That is the difference pointed out in the decisions cited by the learned Counsel for the applicant. Whether in a particular case the transaction falls within one category or the other depends on the facts and circumstances of that case. That is again a matter of controversy in the present case, the contention of the learned Counsel for the applicant being that the transactions in question resulted merely in the creation of the relationship of creditor and debtor between the opposite party and the bank. 10. Now, it would, in my opinion, be an uttar misconception of the provisions of Section 439, Code of Criminal Procedure to seek redress from this Court by invoking its revisional jurisdiction when the points in issue are of such a controversial character, particularly at an interlocutory stage. 10. Now, it would, in my opinion, be an uttar misconception of the provisions of Section 439, Code of Criminal Procedure to seek redress from this Court by invoking its revisional jurisdiction when the points in issue are of such a controversial character, particularly at an interlocutory stage. That such power of interference does exist admits of no doubt, and that power should in an appropriate case certainly be exercised. It should for instance, be exercised where the admitted facts clearly do not make out an offence, so that it would be nothing but harassment of the accused if the trial were permitted no continue. But then this should be apparent on the very face of the record and not be a matter of acute controversy depending for its determination on a consideration of elaborate arguments relating to questions of fact or law. Where the points in issue at the interlocutory stage are to be unravelled from the meshes of such controversy it would, in my opinion, be a proper exercise of the discretionary powers of revision to let the trial take its course and leave the controversial matter to be adjudicated upon in the judgment eventually to be delivered in the case. 11. The above statement of the facts of the present case would seem clearly to indicate that it is a case where disposal of the question of whether the charge u/s 409, IPC, should not have been framed but the applicant should have been discharged depended on a determination of issues of both fact and law which were highly controversial. No interference at this stage appears therefore to be called for. The application in revision is in consequence wholly misconceived and it is accordingly rejected. The order of stay passed by this Court is hereby vacated and the court below is directed to proceed with the case in accordance with the law. Let the record of the case be sent back forthwith to the court concerned.