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Emperor Vs. Khimchand A. Mehta - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtMumbai
Decided On
Case NumberCriminal Appeal No. 668 of 1933
Judge
Reported inAIR1934Bom303; (1934)36BOMLR639
AppellantEmperor
RespondentKhimchand A. Mehta
DispositionAppeal allowed
Excerpt:
.....(a)(iii) and clause (b)(ii)-joinder of more than three charges.; a joinder of three distinct charges, each charge comprising offences under clause (b)(ii) and clause (a)(iii) of section 103 of the presidency-towns insolvency act, 1909, is illegal under section 233 of the criminal procedure code, 1898. - maharashtra scheduled castes, scheduled tribes, de-notified tribes (vimukta jatis), nomadic tribes, other backward classes and special backward category (regulation of issuance and verification of) caste certificate act (23 of 2001), sections 6 & 10: [s.b. mhase, a.p. deshpande & p.b. varale, jj] caste certificate petitioner seeking appointment against the post reserved for member of schedule tribe his caste certificate was invalidated subsequently held, his appointment would not..........is :on a careful consideration of the whole of the evidence it is satisfactorily proved that the accused fraudulently with intent to conceal the state of his affairs made a false entry debiting rs. 10,000/- to waghji luxmidas on the 11th november 1929 in respect of 300 tons of steel masts which fact will have to be investigated under the act, for waghji luxmidas has claimed rs. 5,000/- and the accused has shown him as a debtor in his schedule to the extent of rs. 5,034/-.10. next he goes on to say:it is satisfactorily proved that fraudulently with intent to diminish the sum to be divided amongst his creditors he made a false entry debiting chandrasen and co. with rs. 14,099-1-9 on the 16th november 1929, and it is also satisfactorily proved that he fraudulently with intent to diminish.....
Judgment:

Murphy, J.

1. The appellant, Khimchand A. Mehta, has been convicted on three charges under Section 103 of the Presidency-towns Insolvency Act, and has been sentenced to fifteen months' rigorous imprisonment on each of the charges, the sentences to run concurrently. He has appealed against his convictions and sentences.

2. The first point raised by Mr. Carden Noad is that his client has been improperly tried, because the charges framed against him are really two on each count, and amount to at least five, if not six, charges of separate offences.

3. The prosecution story is as follows :

Appellant was doing business in Bombay since before 1918, principally as an auctioneer, though he had several other branches which were sub-departments of it. He is said to have speculated and to have lost large sums, and since 1926, in any case, his business was carried on, more or less, on credit. Things went on in this fashion until February, 1929, when, on the application of a creditor to the Insolvency Court, his books were seized and he was ultimately adjudicated an insolvent. His liabilities were Rs. 3,41,274, Rs. 3,00,000 being unsecured, and the amount of his assets ultimately recovered came to about Rs. 20,000. After the insolvency, there was a proceeding by notice of motion before the Commissioner in Insolvency, Mr. Justice B.J. Wadia, who held that certain matters falling within the purview of Section 103 of the Presidency-towns Insolvency Act needed investigation, and he accordingly directed that a complaint should be lodged against the accused. This was done in the Court of the Presidency Magistrate, Third Court, Mr. Khandalavala, and the trial appears to have lasted for about nine months, ending in the manner I have already stated. The provisions of Section 103 of the Presidency-towns Insolvency Act are, that when any person who has been adjudged insolvent (a) has fraudulently, with the intent to conceal the state of his affairs or to defeat the objects of the Act, done certain things, which fall under three heads; or (b) has fraudulently, with intent to diminish the sum to be divided amongst his creditors, or of giving an undue preference to any of the said creditors, done certain other things, he shall on conviction be punishable with imprisonment for a term which may extend to two years.

4. The section falls into two parts, the intention under each being different, and under each part there are several cases of specific offences. The accused here has presumably been convicted under Section 103, Clause (b)(ii), with having 'made away with, charged, mortgaged or concealed any part of his property of what kind soever'. The intention under Sub-section (b) is that the act has been done fraudulently and with intent to diminish the sum to be divided amongst: the creditors, or of giving an undue preference to any of the said creditors. Unfortunately, when the charge was framed, the Magistrate contented himself with quoting Section 103 at the end of it, and has not specified under which of the five possible heads of the charge the accused has been convicted in each case. The charge is to the following effect :

Firstly :-

That you on or about the 10th day of February 1930 fraudulently with intent to diminish the sum to be divided amongst your creditors made away with or charged your household furniture and two bales of piece-goods in favour of Section K. Daftary and have in connection with the said pledge fraudulently made a credit entry for the sum of Rs. 4,300, by crediting the said sum to the account of Section K. Daftary as a transfer from an alleged suspense account on the date of your insolvency, viz., 17.2.1930 and thereby committed an offence punishable under Section 103 of the Presidency-towns Insolvency Act and within my cognizance.

5. The second count is as follows:

That you at Bombay on or about the 16th November 1929 fraudulently with intent to diminish the sum to be divided amongst your creditors have made away with or concealed the sum of Rs. 14,099-1-9 by debiting the said sum to the account of Chandrasen and Co. and that in connection with this transaction you made a false entry in your books of account by debiting the said sum of Rs. 14,099-1-9 to Chandrasen and Co. and thereby committed an offence punishable under Section 103 of the Presidency-towns Insolvency Act and within my cognizance.

6. The third count is:

That you at Bombay on or about 11-11-29 fraudulently with intent to diminish the Bum to be divided amongst your creditors have made away with or concealed the sum of Rs. 10,000/- by debiting the said sum to the account of Waghji Laxmidas and that in connection with this transaction you have made a false entry in the account book by debiting the said sum of Rs. 10,000/- to Waghji Laxmidas, and thereby committed an offence punishable under Section 103 of the Presidency-towns Insolvency Act and within my cognizance.

7. The first part of each count sets out an offence which falls under Section 103(b)(ii). Mr. Carden Noad's argument has been that the second clause commencing with ' and have in connection with ' in each case really sets out what is an offence under Section 103(a)(iii), that is to say, ' have made a false entry in the accounts ' or 'has made false entries in the accounts ', and, therefore, he has suggested that what the accused has been tried on was not three charges falling under Section 103(b)(ii) but three charges under that part of the section, together with three charges under Section 103(a)(iii), a joinder of charges of this character not being permissible under the Criminal Procedure Code. The provision in Section 233 of that Code relating to charges is-

For every distinct offence of which any person is accused there shall be a separate charge, and every such charge shall be tried separately, except in the cases mentioned in sections 234, 235, 236 and 239.

8. Section 234 provides for the case of three offences of the same kind within the space of twelve months, and admittedly if the charge had been so limited in this case, it would have been correct. Section 235 provides for the trial for more than one offence at one trial, where the act alleged is one of a series of acts so connected together as to form the same transaction, and more offences than one are committed by the same person. In those circumstances an accused may be charged with, and tried at one trial for, every such offence. Section 236 provides for cases when it is doubtful what offence has been committed; and, finally, Section 239 deals with persons who may be charged jointly.

9. It seems to us that the form of the charge in the present case does not fall within any of the exceptions to Section 233 which I have just quoted. The Government Pleader's argument on the point was that the intention of the learned Magistrate was, not to charge the accused under Section 103(a)(iii) at all, that the language used in this connection was only an amplification or illustration, and that the charge is under Section 103(b)(ii). This argument is, we think, very difficult to maintain in face of the frame of the charge, and also in view of the learned Magistrate's judgment and finding. What he says is :

On a careful consideration of the whole of the evidence it is satisfactorily proved that the accused fraudulently with intent to conceal the state of his affairs made a false entry debiting Rs. 10,000/- to Waghji Luxmidas on the 11th November 1929 in respect of 300 tons of steel masts which fact will have to be investigated under the Act, for Waghji Luxmidas has claimed Rs. 5,000/- and the accused has shown him as a debtor in his schedule to the extent of Rs. 5,034/-.

10. Next he goes on to say:

It is satisfactorily proved that fraudulently with intent to diminish the sum to be divided amongst his creditors he made a false entry debiting Chandrasen and Co. with Rs. 14,099-1-9 on the 16th November 1929, and it is also satisfactorily proved that he fraudulently with intent to diminish the sum to be divided amongst his creditors made away with or charged two cases of 'dhoties' and his household furniture in favour of Daftary, and in that connection made a false credit entry in respect of Rs. 4,300/-. Accordingly I find him guilty under the above section in respect of all the three charges. In my opinion a case of this kind calls for a deterrent sentence, and therefore I sentence the accused on each of the three charges to 15 months' rigorous imprisonment.

11. In view of this finding we think that the accused has been convicted on the last count under the second part under Section 103(a)(iii), the intention found being that required under Sub-section (a). The charge, it is true, only mentioned the necessary intention under Sub-section (b), but the Magistrate's finding is as I have just stated, and since there was no charge in the alternative under Sub-section (a) or Sub-section (b), it seems clear that the Magistrate's view, at any rate, was that the charge covered both sets of facts, and if this is so, the case on the first part of the third head of the charge must have failed. This must also be so on the other two cases where one part is ignored in the finding and the conviction is under Sub-section (6)(ii). The course of the trial and the mass of evidence which has been led in it, also clearly show that what was aimed at was a charge under both sub-sections of Section 103 of the Presidency-towns Insolvency Act. We think that this is a case of multiple charges exceeding three in number, and if we are correct in so thinking, then the trial was irregular and illegal and the conviction based upon it obviously cannot be sustained

12. We have carefully considered the learned Government Pleader's argument to the contrary, but it seems to us that the acts complained of by the prosecution in the three counts of the charge cannot be looked at from the standpoint which he has explained. What was in fact charged against the accused on the first count was that he mortgaged his household effects and two bales of piece-goods to one Section K. Daftary for what is ultimately a sum of Rs. 4,300. The allegation was that this was not a real charge or mortgage, but merely a device intended to put the accused's household effects and the two bales of piece-goods out of the reach of his creditors. If that was all that was intended, there was clearly no need of mentioning or alleging that he had also falsified his accounts in the same head of the charge. Similarly, in the case of the second head, what was alleged against the accused was that he had paid a sum of Rs. 14,099-1-9 into what has been called Chandrasen and Co.'s account, really taking it out of the business of K.A. Mehta and putting it aside to defraud his creditors. The same was the argument as to the third count. This being all that is alleged in each case, there was clearly no point in mentioning the falsifications of accounts which the prosecution alleged to have taken place, parallel with the events in question, if it was not really intended, when alleging them, to charge him with those facts also. We, therefore, cannot accept the learned Government Pleader's argument and must find that accused has not been properly charged in this trial in that the number of charges made against him exceed those permissible under the section relating to charges.

13. The next point we have to consider is, whether the accused should be re-tried. For this purpose I have to mention the facts to some extent. After discussing the evidence his Lordship proceeded:

14. We have gone carefully through the evidence in order to see whether the accused should be re-tried, or not. On the facts that I have just narrated, it seems to us that the case is not so clear and decisive as to warrant a re-trial. The first trial lasted about nine months and has taken up a considerable portion of public time. The accused has been subjected to this prosecution in addition to his insolvency, and on the facts it seems to us that far from there being a certainty, there is not even much probability that, if we order a re-trial, there would be a conviction. The expenses of a new trial would be very heavy. We think that we should follow the principle laid down in Emperor v. Durgadas1 and refrain from ordering a re-trial.

15. We reverse the convictions recorded against and sentences passed upon the accused and direct that he be acquitted and discharged.

16. The bail bonds to be cancelled.

Divatia, J.

17. I agree.


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