Research › Search › Judgment

Andhra High Court · body

2006 DIGILAW 239 (AP)

M. Venkata Naidu v. State

2006-02-22

M.E.N.PATRUDU

body2006
( 1 ) THE appellant was convicted for an offence punishable under Section 408 of the Indian penal Code (for short the IPC ) read with section 79 (f) of the A. P. C. S. Act and sentenced to undergo rigorous imprisonment for a period of six months and to pay a fine of rs. 5,000/- in default to undergo simple imprisonment for three months. ( 2 ) SECTION 408 of the IPC deals with the punishment for criminal breach of trust by clerk or servant. It is as follows:- whoever, being a clerk or servant or employed as a clerk or servant and being in any manner entrusted in such capacity with property, or with any dominion over property, commits criminal breach of trust in respect of that property, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine". Criminal Breach of Trust is defined under section 405 of the IPC and it is as follows:-"whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or willfully suffers any other person so to do, commits "criminal breach of trust"explanation 1-A person, being an employer, (of an establishment whether exempted under Section 17 of the employees Provident Funds and miscellaneous Provisions Act, 1952 (19 of 1952) or not) who deducts for credit to a Provident Fund or Family Pension fund established by any law for the time being in force, shall be deemed to have been entrusted with the amount for the contribution so deducted by him and if he makes default in the payment of such contribution to the said fund in violation of said law, shall be deemed to have dishonestly used the amount of the said contribution in violation of a direction of law as aforesaid. Explanation 2 - A person, being an employer, who deducts the employee s contribution from the wages payable to the employee for credit to the employees State Insurance Fund held and administered by the Employees state Insurance Corporation established underthe Employee s State insurance Act, 1948 (34 of 1948) shall be deemed to have been entrusted with the amount of the contribution so deducted by him and if he makes default in the payment of such contribution to the said fund in violation of the said Act, shall be deemed to have dishonestly used the amount of the said contribution in violation of a direction of law as aforesaid. ( 3 ) WHENEVER a charge of criminal breach of trust is alleged the main ingredients to attract the offence are (1) the accused must have been trusted with the property or dominion over it, (2) the accused must have misappropriated the property or disposed of that property in violation of such trust. ( 4 ) BEFORE going to the second limb of the offence of misappropriation, it is necessary for the Court to/verify whether the trust imposed on the accused by entrusting the property is betrayed. ( 5 ) THUS, the entrustment of property and the subsequently breach of such trust with a dishonest and fraudulent intention are essential. Persons as clerks, agents, servants or otherwise, under whatsoever name have a confidence reposed in them by their employers and are, whether in the ordinary course of their employment or only occasionally entrusted with the property and persons whose employment does not extend beyond the particular occasion on which they are so entrusted seem to be within this section. Thus, the evidence of trust and dishonest misappropriation are sufficient to constitute an offence under this section. So also there must be the intention to cause wrongful gain or wrongful loss to constitute a criminal breach of trust. For the purpose of this Section, it is not necessary that the entrustment should be express and an implied entrustment will suffice and the burden of proving entrustment of money rests on the prosecution and it is proved that the accused was not in possession of the amount entrusted to him, it is for the accused to -prove satisfactorily that he had not embezzled or misappropriated the amount. It is not for the prosecution to prove how he disposed of the amount. It is not for the prosecution to prove how he disposed of the amount. So also, if a person allows others to misappropriate the money entrusted to him, that amounts to a criminal breach of trust as defined by Section 405 of the IPC. The section consists of property is a positive part and a negative part. The positive part deals with criminal misappropriation or conversion of the property and the negative part consists of dishonestly using or disposing of the property in violation of any direction of law or any contract concluding the discharge of trust. ( 6 ) THE expression "entrusted" is used in a wide sense and includes all cases in which the property of voluntarily handed over for a specified purpose and is disposed of dishonestly contrary to the purpose. According to Section 405, IPC, a dishonest misappropriation or conversion to his own use or dishonest use or disposal of property in violation of any direction of law or of any legal contract is a necessary ingredient of offence of criminal breach of trust. The property referred to in this section must be as in Section 403 IPC and it can be a movable property. Entrustment ( 7 ) THE term entrustment is not necessarily a term of law. It may have different implications indifferent contexts. In its most general signification, all it imports is the handing over the possession for some purpose which may not imply the conferring of any proprietary right at all. The words "in any manner in the section show that the entrustment of property with the accused may be brought about in various ways. To attract the offence of criminal breach of trust, it is essential that the prosecution must prove first of all that the accused was entrusted with some property or with any dominion or power over it. The word "entrusted" in this section is used in its legal and not in its figurative or popular sense. The decisive test is whether there was an entrustment within the meaning of section 405 IPC and the subsequent criminal intention. When cash is received by a clerk of the society is expected to account for properly or till such time entrustment is with him. The intention to cause wrongful loss is enough too narrow interpretation of the word "dishonest" should not be placed leading to substantial injustice. When cash is received by a clerk of the society is expected to account for properly or till such time entrustment is with him. The intention to cause wrongful loss is enough too narrow interpretation of the word "dishonest" should not be placed leading to substantial injustice. In order to establish a charge of dishonest misappropriation or criminal breach of trust, it is necessary that if cash which was entrusted to a government servant was not properly counted for it and converted it for his personal usage. ( 8 ) WHEN a cashier collected the amounts and not deposited in the bank or not handed over the same to his president or secretary the requisite dishonest intention can be inferred. ( 9 ) WHEN the accused deposited the alleged misappropriated amount during pendency of the trial or subsequently or prior to and due to the length of the trial there can be a concession with regard to sentence. Where the accused who was a clerk admittedly received the money belonging to the society and was asked to account and give satisfactory explanation which he failed to do so he was criminally as well as civilly liable to his loss. A village officer delayed the remitting of the amount for a considerable time held to be guilty of an offence under section 408 of the IPC. A cashier who has no authority to delegate the entrustment of the amount with others delegate the same the said functions will be held responsible for dereliction of his duty. ( 10 ) IN this case it was alleged that the accused who was working as a cashier collected the amount but failed to deposit into bank or hand over the same to his in charge when he was going on leave. Therefore, the offence is made out. ( 10 ) IN this case it was alleged that the accused who was working as a cashier collected the amount but failed to deposit into bank or hand over the same to his in charge when he was going on leave. Therefore, the offence is made out. In the evidence it was found that the accounts on which the case is relied for not regularly kept though the entries made by the accused himself and as the money was in the custody of the secretary and the president working in the same office and the compulsion (?) made by the accused was found not to be voluntarily made, it was inferred from the circumstances that it was made under threat and coercion the accused would be entitled to benefit of doubt, dwarakadas Rameshwar Paldiwal v. Satyanarayan Makhanlal Gododiya the sentence can be reduced in a special circumstances. In the instant case, the appellant is not a previous convict. He lost his job because of his ill-health and prolonged leave. Agony of trial was held for 8 to 9 years. Therefore, benefit of probation can be given and a sentence was justified to be reduced. The appellant was in jail for one month and under the same circumstances the sentence is reduced to the period already undergone. The appellant was thrown out from the job due to conviction. He suffered 14 years of protracted trial. Hence, the sentence was reduced to that period already undergone. Where there was an misappropriation of amounts and the same was deposited by the accused who was in jail for some time and the accused having paid the fine amount the sentence was modified to the period already undergone. Hence, the sentence already undergone can be accepted. ( 11 ) IN the result the appeal is dismissed and the conviction of the appellant under section 408 IPC r/w 79 (f) of A. P. C. S. Act is confirmed, but the sentence of six months rigorous imprisonment is modified and it is reduced to the sentence already undergone and the fine of Rs. 5,000/- is confirmed.