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Durgadas Radhakisan and ors. Vs. Emperor - Court Judgment

LegalCrystal Citation
CourtMumbai
Decided On
Judge
Reported inAIR1934Bom48; 148Ind.Cas.271
AppellantDurgadas Radhakisan and ors.
RespondentEmperor
Excerpt:
penal code (act xlv of 1860), section 420 - cheating--company floated for lending money at cheap rates of interest--mere fact of scheme being speculative--whether punishable when it is not dishonest or fraudulent--criminal procedure code (act v of 1898), sections 253, 436--discharge of accused by magistrate--power of sessions judge to set aside order of discharge--conditions for exercise of power--further inquiri. - - the syndicate issued its articles of association as well as the memorandum of association and also forms of applications for loans to which were attached certain conditions, 28 in number, which were to govern the grant and the refund of these loans. the object of the company was to advance money to poor and needy persons at a very cheap rate of interest, viz. as soon as it.....divatia, j.1. these are two applications in revision preferred by accused nos. 2 and 4 and nos. 1 and 3, respectively, against the order of the sessions judge of ahmedabad setting aside the order of discharge of these accused by the additional city magistrate of ahmedabad, and ordering that the accused should be tried again by another first class magistrate to whom the case may be transferred by the district magistrate.2. the prosecution case against the four accused in substance is that these accused have committed ( an offence of cheating a number of people in gujrat and in the baroda state, inasmuch as they, in furtherance of a fraudulent scheme, made misrepresentations to people by which ignorant and illiterate people were induced to go in for loans for very large amounts which the.....
Judgment:

Divatia, J.

1. These are two applications in revision preferred by accused Nos. 2 and 4 and Nos. 1 and 3, respectively, against the order of the Sessions Judge of Ahmedabad setting aside the order of discharge of these accused by the Additional City Magistrate of Ahmedabad, and ordering that the accused should be tried again by another First Class Magistrate to whom the case may be transferred by the District Magistrate.

2. The prosecution case against the four accused in substance is that these accused have committed ( an offence of cheating a number of people in Gujrat and in the Baroda State, inasmuch as they, in furtherance of a fraudulent scheme, made misrepresentations to people by which ignorant and Illiterate people were induced to go in for loans for very large amounts which the accused could not have paid. Out of the four accused in this case, No. 1, Durgadas, is the promoter of the scheme which is known as 'The Delhi Syndicate Ltd.' Accused No. 2 is the chief agent for Gujrat, the head office being at Delhi. Accused No. 3 is the general organizer and canvasser of the Syndicate, and accused No. 4 is the local agent of this Syndicate at Ahmedabad. It appears that this Syndicate was started at Delhi in January, 1929 and accused No. 1 was appointed as its secretary and. general manager. The Syndicate issued its articles of association as well as the memorandum of association and also forms of applications for loans to which were attached certain conditions, 28 in number, which were to govern the grant and the refund of these loans. The authorized capilalof this concern was Rs. 20,000 divided into eighty shares of Rs. 250 each; but the capital of Rs. 1,250 only was subscribed by three sharers of whom accused No. 1 and one Narayan Datta purchased one share each and one Shivnath purchased three shares. The object of the company was to advance money to poor and needy persons at a very cheap rate of interest, viz., one and a half per cent, per annum, which was to be repayable alter about five to eight years from the grant of the loan. It appears that this company did not flourish in Delhi where it was started, and about a year and a half after it was started, the company extended its operations to Gujrat and established a branch office at Ahmedabad with accused No. 1 as its local agent. As soon as it was established, certain leaflets were issued, and the forms of applications as well as the conditions, which were printed in English, Hindi and Urdu, were distributed among the people, and the people, being attracted by the cheap terms on which the loans were to be granted at once flocked in with applications for loans, and there was a regular rush not only on the part of the people at Ahmedabad but from different parts of Gujrat. It appears that one Nandlal Shah, the complainant in this case, doubted the genuine nature of this scheme and started certain enquiries about the person who started the scheme as well as about its nature. At the time when the operations of this Syndicate began in Ahmedabad, the promoter of the scheme, accused No. 1, was in jail and he arrived in Ahmedabad for the first time in July and his second visit to Ahmedabad was in the middle of August, and soon after that he was arrested in Ahmedabad.

3. The complaint in short is that the company itself is a fraudulent concern and the scheme itself amounted to cheat people and that there were various misrepresentations made by the accused to the people as well as lo the sub-agents who were appointed to canvass for the scheme in different parts of Gujrat. The complaint further says that the people were told that certain Congress leaders had put all their savings in the company with the result that there were crores of rupees as capital and that they would get the amount of the loan within a month from the date of their applications. It was also stated that accused No. 1 was falsely represented as the vice-president of the Congress Samiti and that he was arrayed against the capitalists for the benefit of the poor people.

4. Now, on this complaint various witnesses have been examined and these witnesses would fall under two classes. One class is that of sub-agents appointed in different parts of the province and the other class is that of the applicants for loans themselves, who have come and deposed that they had gone in for the loans and that they have not been paid their money. In some cases they have been paid their ten per cent, and subsequently they have again re-invested that money for further loans and they have not been able to secure the amount of the further loans

5. Now, it is important to see here the principal nature of this scheme. This scheme, which is known as 'The All-India Auto Link,' is rather complicated, but the main idea of the scheme is to grant loans by four unequal instalments to each applicant, whether he may bean applicant for a small sum of Rs. 50 or for a large amount of Rs. 5,000. For instance, an applicant, who had applied for a loan of Rs. 100, had in the beginning to pay Rs. 6 as admission fee, and Rs. 7 as candidature fee, that is, in all Rs. 13. He was to get his loan in four unequal instalments, one instalment which was equal to one-half of the loan amount, two instalments each equal to one-fifth of the loan amount applied for, and one instalment equal to one-tenth of the loan amount applied for. It was a further condition that as soon as fifteen loan candidates got themselves registered in any of the series in the All-India Auto Link Register the company would proceed to advance the loans in the manner stated in the rules under which one loan equal to one-half of the amount of the series was to be given to each candidate in turn beginning from the top of the series; six loans, each of which was to be an amount equal to one-tenth of the amount of the series, were to be distributed by drawing, and two loans of an amount equal to one-fifth of the series each were to be distributed by drawing among the candidates who had already received a loan equal to one half or one-tenth of the amount of the series or both. Then there are two material conditions which I would note. The first condition was that every candidate would be eligible for only one kind of loan in one distribution, and the company did not guarantee the period within which any candidate would get one or the other of any of the four instalments mentioned in Clause 4(a), and the second important condition was that if a candidate was neither able to get the full loan nor free cash bonus, nor did he succeed in getting any part loan as mentioned in condition 4(b) within the first year of his application, then he would be refunded his candidature fee after one year of his applying for refund of the same. It was further provided that these loan amounts would be refundable to the company in five to eight years time according to the conditions agreed upon at the time of the advancement of the loan, and the last condition was that all applications would be understood to have been put in after full understanding and acceptance of the rules and conditions.

6. Now, this is the scheme which is stated to be a fraudulent scheme by itself apart from the representations made by the four accused to the people. The learned Magistrate, who tried this case, examined a number of witnesses before him, and he was ultimately of opinion that this scheme did not amount to cheating, by itself, and he also states in his judgment that the police prosecutor admitted before him that there was not clear and sufficient evidence to bring home the offence of cheating under Section 420, Indian Penal Code, to the accused, but it was suggested that a charge may be framed against the accused for an offence under Section 120-B read with Section 420, Indian Penal Code. It appears that the learned Magistrate has not purported to act on this admission of the police prosecutor by treating it as a withdrawal of the complaint under Section 491 of the Criminal Procedure Code, nor did the police, prosecutor himself invite the Court to act under that section, but he admitted at the close of the case and probably in his argument before, the Court that there was no case of cheating, and although the learned Magistrate has not purported to act under Section 494 of the Criminal Procedure Code, he has discharged the accused under Section 253, Criminal Procedure Code. He appears to be of opinion that the scheme by itself did not amount to cheating at all, and, secondly, that accused No. 1 was not guilty of cheating, and the other accused, namely, accused Nos. 2 to 4, would not be guilty of any conspiracy for cheating inasmuch as they honestly' believed the representations which they made to be true, and there was nothing to show that these persons had any idea to conspire among themselves and to cheat the public and as to conspiracy, the learned Magistrate being of opinion that accused Nos. 2 to 4 not being members of any conspiracy, the charge of conspiracy against accused No. 1 cannot possibly stand as there was no person with whom he could conspire to commit this offence of cheating against the public. On these grounds the learned Magistrate discharged all the four accused under Section 253 of the Criminal Procedure Code.

7. Against this order of discharge, the Assistant Public Prosecutor filed an application under instructions of the District Magistrate' in the Sessions Court at Ahmedabad with a request that the order of discharge may be set aside and that the opponents be ordered to be re-tried. The learned Sessions Judge in his judgment has summarised the nature of this scheme and the argument urged by the complainant in the lower Court as to the nature of the scheme and he seems to be of opinion that the scheme itself shows a dishonest intention on the part of its promoters and that by itself it is a fraudulent scheme. The main grounds on which he calls the scheme fraudulent are that this company invited loan applications without any limit on the strength of a very small capital that I he loans were indiscriminately distributed to the relatives of the accused and many of the applicants did not succeed in getting loans in full, and although opponents Nos. 2 to 4 had not combined with opponent No. 1 originally in the promotion of this company, still they joined subsequently and helped accused No. 1 in carrying out his fraudulent scheme. Then the learned Sessions Judge says that the learned Magistrate has not applied his mind to the evidence in the case of various witnesses which showed that misrepresentations had been made to them by these accused, and these persons acted on those misrepresentations, and that on these grounds there was a prima facie case against the accused for the offence of cheating. The learned Sessions Judge says, I therefore, that accused Nos. 1 to 4 should be charged with the offence of conspiracy to cheat, and that they should be tried again by another Magistrate, and he set aside the order of discharge on that ground. It is against this order that these two applications for revision have been filed.

8. Before I proceed to discuss the merits of the scheme and its alleged fraudulent nature, and the misrepresentations which are alleged to have been made by the accused to the public, it is material to see what are the provisions of the law under which alone the order of discharge passed by the Magistrate could be set aside. Under Section 436 of the Criminal Procedure Code, the High Court or, the Sessions Judge, on examining the record under Section 435 or otherwise, might direct the District Magistrate by himself or by any of the Magistrates Subordinate to him to make, and the District Magistrate might himself make or direct any Subordinate Magistrate to make, further inquiry into any complaint which has been dismissed under Section 203 or Sub-section (3) of Section 204, or into the case of any persons accused of an offence who has been discharged. Now, as to the powers of the Sessions Judge under this section, there have been various rulings of different High Courts and we have got the latest ruling. On this point of our Court in Emperor v. Parashram Bhika 143 Ind. Cas. 289 : 35 Bom. L.R. 245 : A.I.R. 1933 Bom. 158 : (1933) Bom. 266 : 34 Cri. L.J. 564 : (1933) Cr. Cas. 470 : 57 B. 430 In this case all the important provious authorities bearing on this point have been considered and discussed, and as a result of these authorities it is laid down that an order of discharge made by a Magistrate after hearing all the evidence for the prosecution ought not to be set aside Unless it can be said that the order was perverse or manifestly unreasonable and inconsistent with an honest appreciation of the evidence before the Court. It is clear that the Sessions Court acting under Section 436 is not a Court of appeal which has to re-appreciate the evidence which has been appreciated already by the Magistrate, but it can act only if the judgment is not perverse or irrational, that the only inference that could be drawn from the judgment was that the Magistrate had not honestly applied his mind to the material facts found in the case.

9. Now, it is by that test that we have to examine the judgment of the learned Additional City Magistrate in this case. The learned City Magistrate says in the first place that the scheme itself is not a fraudulent scheme, and with respect I agree with that conclusion of the learned Magistrate. In this connection it is important to see that the conditions attached to the applications for loans have been set out in full, and they make one thing clear that although the scheme may be very highly speculative and in a sense it may be somewhat chimerical, still nothing was concealed from the public and everything was disclosed, not only as to how the loans were to be granted, but also as to how the money was to be refunded in case the applicants could not secure a loan for which they applied. It is one thing to say that the scheme was speculative and that the public, if they invested any money in it, were likely to lose their money, and it is another thing to say that this scheme was started with a dishonest intention of cheating the public and in that sense being fraudulent. It is probable to my mind that if the requisite number of applicants had not been forthcoming after the scheme was started, then very probably the scheme would have ended in a crash, but I do not think that should be a reason for regarding this scheme as being dishonest from the beginning and launched only with the desire to cheat poor people out of their money. It is true that the forms of applications and the rules in this case were not printed in the vernacular in the Gujarat, viz., the Gujarati, and that they were printed in English, Hindi and Urdu, but it appears that most of the form, which were supplied to the applicants were printed in Balbodh script and the Hindi language, and although it may be that an applicant himself - may not be able to understand Hindi perfectly well, I do not think it is possible that an average Gujarati applicant would not be able to understand the gist of those conditions which were printed in Balbodh which the Gujarat is might be able to read.

10. But apart from that we have got the statement of the various witnesses in this case who have come to depose that they went in for applications for loans merely because it was represented to them that influential Congress people were at the back of the scheme, that they had invested cores of rupees in this scheme, and that the accused further represented that the applicants were to get the amount applied for within a month of the date of their applications. Now, we have been taken into the evidence of the various witnesses, who as I have said, fall into two classes, one, the Sub-agents, and the other, the applicants themselves. Taking the Sub-agents themselves, it is true that some of them have come and deposed that it was represented to them that the capital of this company extended to crores of rupees. I, however, am not sure that these sub-agents had not before them the forms of application and also the conditions of the loans attached to them, and if the sub-agents had simply read the articles of association and the memorandum of association, it would have been clear that the capital of the company was Rs. 20,000 divided into eighty shares of Rs. 250 each and they could have seen from the conditions that the company did not guarantee the payment of the whole of the amount of the loan within any particular period. Then, as to the applicants themselves, no doubt, a number of these applicants have come and deposed that they would not have gone in for these loans if those representations had not been made. But there seem to be some discrepant statements as to the nature of these representations alleged to have been made by the accused. For instance, one witness says that it was represented to him that the company had a capital of sixty crores of rupees, and that ten per cent, of the loan would be paid in eight days and the rest within a month. I will take one typical case of one of the persons who speaks of these representations. That witness is Ex 19 at p. 108. He says that accused No. 4 stated that the company had a capital of 200 crores and that it advanced loans to needy people at two annas interest. Then he says further 'the figure of the capital mentioned to me by accused No. 4 was so fabulous that I could not believe.' But then he goes on to say in the next sentence: 'I paid Rs. 39 on August 11, for a loan bf Rs. 300.' This, I think, is typical of the general nature of the evidence, namely, that although it may be that in some cases it might have been represented that the capital of the company extended to crores of rupees and that Congress leaders had invested their money in this concern, still I am not quite sure that the applicants themselves went in for these loans, when they did so, only because they acted upon these representations and these representations alone. I should think that because the scheme itself was advanced to these persons on very easy terms, namely, at this ridiculous rate of one and a half per cent, per year and the loans were to be re-paid after five to eight years, these persons went in for these loans, and not because these representations had been made to them; nor do I think that all the applicants had been misled by these misrepresentations, when we see that one of the applicants is an Inamdar and another is a Karbhari of a Taluqdar and both of them say that although the forms in Hindi had been supplied to them and they had read them, they did not quite understand the nature of the terms, and still they went in for the loans. So that it cannot be said here definitely that the people invested their money only because of these representations alleged to have been made by 1 he accused.

11. Then, there is another point also in favour of accused No. 1. Admittedly accused No. 1 was in jail at the time when the operations of this company began in Ahmedabad in the middle of June, and he came for the first time to Ahmedabad in July and for the second time in the middle of August. There is nothing in the evidence to show that it was this accused No. 1 who made these misrepresentations directly to any of the applicants at the time when he was in Ahmedabad, nor is there anything in evidence to show that he ever directed or wrote to his agents in Gujarat from Delhi to make any misrepresentations to the public, and I think it was conceded in the trial Court that accused No. 1 in any case would not be guilty of the offence of cheating in the sense of he himself making false representations. The applicants themselves have net involved accused No, 1 at all in the making of these misrepresentations. The evidence is directed mostly against accused No. 4 and accused No. 2, and to a certain extent against accused No. 3 who was the general canvasser. Therefore, accused No. 1, I think, would not be guilty of the offence of cheating in both the aspects as urged in the complaint, as to the fraudulent character of the scheme and the fraudulent representations made.

12. Then, as to the other accused Nos. 2 to 4, the learned Magistrate has stated that these accused were all servants of the company and they made these representations to the people under a bona fide belief and an honest intention that these persons would get their money within a month. Now, on this point I may observe that the evidence is not quite conclusive. For instance, the Sub-Inspector of Police, who examined the books and the vouchers of the company has deposed that a number of persons did not get even their ten per cent, of the loan for which they had made their applications, while some persons got their money in full before the middle of August. Now, it is true that some persons have got the whole of the amount of the loan before the middle of August, but these persons, it seems, are applicants for loans of very large amounts, viz., Rs. 5,000 and 3,000, and if under this Auto Link scheme they secured other persons who could be connected with them in it, then it is very probable that they may get the whole of the amount within the period that is stated in the deposition of the Sub-Inspector. Then, as to the other applicants not getting even ten per cent, of the loans, it appears that most of them did get the whole of the amount of their first loans of Rs. 100 within a month, but what these persons appear to have done is that as soon as they had received the loan, they seem to have reinvested their amount in asking for further loans of larger amounts, and these larger amounts they have not been able to secure before the middle of August by which time the accused were arrested and the affairs of the company stopped. The case of the accused is that these persons would have ordinarily got their amount which they had applied for if the affairs of the company had proceeded further in the ordinary course of things, and further applications had come in, because it is on account of the application money of the further applicants that they could pay the applicants who] had previously applied for loans. It is possible that if the work of this company had not been closed by the middle of August, at least some of the persons who had applied for loans and who could not get the money before the middle of August might have got their money provided other applications were forthcoming, and it is also possible that other applications would have been forthcoming, because we have seen that up to the middle of August there was a regular rush of applications asking for loans. It may be that subsequently the company might have found itself in trouble if a sufficiently large number of people had not applied for loans, but we are not concerned with that.

13. The only point with which we are con-corned is whether the applicants, who did not get their money before the middle of August, could not get it because of any of cheating on the part of any of these accused. Now, it is to be noted that although the accounts of this company have been examined by the Sub-Inspector of Police, there does not appear to be any clear evidence as to any misappropriation of the money of the public made by any of the accused and in fact that is not the charge that is urged by the prosecution against any of the accused. The charge which has been urged against the accused is of cheating under Section 420. Now in this view of the evidence, the only question, therefore would be whether it can be said that the Magistrate, before whom all these witnesses were examined and who had in his mind the whole evidence at the time when he made this order of discharge, acted perversely and irrationally when he said that the scheme itself was not fraudulent and that no case of cheating had been established against the accused. It is possible that any other Magistrate might come to a different conclusion on this evidence, but that is not the test that is to be applied here. The only test is whether the judgment is so perverse that the order of discharge should be set aside under Section 436, and we do not think that ,the judgment of the learned Magistrate can be described as perverse in that sense.

14. The learned Sessions Judge set aside the order of discharge mainly because of the nature of the scheme which he described as fraudulent. With great respect, although it may be said that the scheme was highly speculative, I do not think that we can o to the length of saying that the scheme self was dishonest or fraudulent in the sense that it either represented to the public something which was not true, or concealed from them something which the, company ought to have disclosed. On the contrary the conditions that have been, laid down clearly show that the company did all except that the people might not get their money in full and in that case an opportunity was given to the applicants to apply for the refund of the money and although it may be that some persons who had succeeded in getting the full amount of the loans which were for larger amounts were relatives of some of the accused, it cannot be said that the other applicants, who did not get their money, nor even ten per cent, did so because the accused, as a matter of fact, intended to cheat those people and not to give their instalments when they fell due. The learned Sessions Judge says that the learned Magistrate does not say that he disbelieves the witnesses who have described how misrepresentations were made to them and how they were misled into applying for loans and paying the admission and candidature fees. Now, on that point I may say that the learned Magistrate does appear to have dealt with this point in his judgment when says that the only evidence against the last three accused is that they made certain representations to customers from time to time. Then he says:

If these three accused honestly believed the representations to be true, we could not impute any dishonest intention to them. There ii nothing to connect them on the point of dishonest intention or on the point of conspiracy.

15. That is because they did not know the dishonest nature of the scheme. And the learned Magistrate further says:

They worked as honest men and remained so till the last. The charge of conspiracy could not therefore stand against the last three accused.

16. It cannot, therefore, be said that the learned Magistrate did not keep before his mind the evidence of the various witnesses he had examined when he made the order of discharge. The learned Sessions Judge is of opinion that the evidence of the witnesses did point to making false representations on the part of the accused, while the opinion of the Magistrate was that it did not so point. That however, I think, would not justify the learned Sessions Judge in setting aside the order of discharge. That would mean that his appreciation of evidence en that point was different from the appreciation of the evidence by the learned Magistrate. Then the learned Sessions Judge in his order says that the accused should be tried again by a First Class Magistrate other than the Magistrate who discharged them. Now, this order I do not think is quite appropriate in the circumstances of this case. It is true that under Section 436, Criminal Procedure Code, the Sessions Judge may direct the District Magistrate by himself or by any of the Magistrates subordinate to him to make farther inquiry. The power that is given to the Sessions Court under this section is the power of ordering further inquiry into the complaint that has been dismissed, and the order of the learned Judge here does not simply mean a further inquiry into the complaint which has been dismissed, but it means a re-trial before another Magistrate. It is also a question as to whether all these accused should be tried again by another Migistrate before whom evidence will have to be taken de novo after the lapse of a fairly long time after the case began. Even then it is doubtful whether on the evidence led before the learned Magistrate it would be possible for him to come to the conclusion that the accused were guilty of the offence of cheating beyond any reasonable doubt.

17. In this view of the evidence and also having regard to the general nature of the scheme of this company, I do not think that the learned Sessions Judge was right in setting aside the order of discharge and judged by the test which I have stated above and which has been laid down by this Court, I do not think the order of the Sessions Judge can be supported, especially when he bases it on his opinion that the nature of the scheme itself is fraudulent. It appears that the learned Sessions Judge seems to have been influenced by the fact that a number of people have lost their money in the shape of candidature and other fees which they have paid to this company, but I might say that this result is mostly due to the cupidity and the avarice of the applicants themselves who have rushed into the scheme without properly understanding its speculative nature, and partly it is also due to the fact that the operations of this company were cut down at a time when a number of applicants were rushing into pay their moneys to this company. It cannot be said that this large number of applicants was wholly and solely influenced by the misrepresentations that are alleged to have been made.

18. Therefore, en these grounds I am of opinion that the order of the learned Sessions Judge setting aside the order of discharge should be set aside in the case, and the order of the Magistrate discharging all the accused of the offence should be restored. The Rules in these two, applications would, therefore, be made absolute.

Broomfield, J.

19. I agree and I have only to add a few remarks. In many respects this case is similar to that of the. Peoples' Bank in Poona, the appeal which occupied my brother Murphy and myself a good many days last year. That also was a scheme of the 'snow-ball' nature, but in that case we were satisfied that the literature of the scheme, that is to say, the prospectuses and the advertisements of the company, might be described as mislead-and deceptive, so that the scheme itself could properly be regarded as a fraudulent scheme. In the present case all the conditions of the scheme are set out in black and white. There is no room for misunderstanding. No claim is made to the possession of unlimited capital or to the possession of any capital except the modest amount specified, and no guarantee is made that any loan would be advanced to any applicant within any definite time, The only guarantee given is that if a loan is not advanced within a year, then the applicant can get his candidature fees refunded. That being so, I agree with my learned brother that the scheme in the present case cannot be regarded as a fraudulent scheme, although, no doubt, it has some of the elements of lottery about it.

20. On the other hand, there was before the learned Magistrate a good deal of, evidence to the effect that some of the accused, though apparently not accused No. 1, the founder of the scheme, had made representations to applicants which were not in accordance with the printed scheme at all, that they had stated that the company had a large capital to fall back upon, that it was supported by various influential persons, and more important still, that the applicants would receive their loans within a period as short as one month. Now, it is obvious that if these representations were made by the accused, and if they made them without believing them to be true, and if by these representations they induced the applicants to subscribe to the scheme and they would not otherwise have done so, that would be cheating within the definition in Section 415 of the Code.

21. As regards the principles which should govern the action of the Sessions Judge under Section 436 of the Code, I have nothing to add to, or subtract from, what is stated in Emperor v. Parashram Bhika 143 Ind. Cas. 289 : 35 Bom. L.R. 245 : A.I.R. 1933 Bom. 158 : (1933) Bom. 266 : 34 Cri. L.J. 564 : (1933) Cr. Cas. 470 : 57 B. 430 But everything I stated in that case was stated on the assumption that the Magistrate had considered all the evidence and had also applied his mind to all the material' issues in the case. The only question here which has caused me any difficulty is whether this particular aspect of the case to which I have just referred, namely, the representations alleged to have been made by some of the accused about the capital and about the time when the loans would be received, has been properly considered by the learned Magistrate. He has referred in his order to an admission by the Police Prosecutor that there was not clear and sufficient evidence to bring home the offence of cheating to the accused. This, I may say, appears to me somewhat incomprehensible. The only way in which one could say that there might be the offence of conspiracy to cheat, although there was no cheating established, is if the intention to cheat was present but had not been given effect to either because the Police raid ended, the activities of the company so quickly or because the representations made by the accused, though intended to deceive, had not in fact deceived anybody. I think there is something to be said for each of those propositions as my learned brother has pointed out. But the Magistrate does not seem to have attached importance to that aspect of the case. The view lie seems to have taken was that the accused honestly believed those representations to be true. However that may be (in view of the exhaustive judgment of my learned brother I do not desire to go into details), it is sufficiently clear that the Magistrate has considered the evidence on this point as well as on the other points in the case, and I think it would be impossible to say that there is any lacuna in the case or that any material issue has not been explored. That being so, I consider that it was not a case for interference under Section 436.

22. There is one other point I desire to mention. Section 436 provides for further inquiry. What the learned Sessions Judge has ordered is a re-trial, and he has specified that it should be by another Magistrate. Now, I am not prepared to say that that is illegal. I think a case might come within the scope of the authorities and the Sessions Judge might be justified in interfering notwithstanding that further inquiry would in effect mean a re-trial of the case. On the other hand, 1 think it is obvious that that is not what Section 436 contemplates in the ordinary way, and one would need to have a very strong case indeed to justify an order for re-trial do, novo. It appears that the proceedings in this case were instituted on August 16, 1930 and the trial before the Magistrate began in January, 1931 and continued until the order of discharge was made on July 23, 1932. The expense of a new trial must be very heavy, to say nothing of the harassment of the accused. Then again, having regard to the nature of the evidence as to these representations by the accused, I agree with my learned brother in thinking that it is almost certainly very much exaggerated, and that in many respects it is very far from convincing, the probability of a new trial resulting in a conviction would seem to be rather remote.

23. These are all matters which ought to be considered in determining whether the discretionary power under Section 436 should be exercised. In the present case I am of opinion that even if it had been a case for interference on principle, the Sessions Judge ought not, under the particular circumstances, to have interfered.

24. I, therefore, agree that the Sessions Judge's order should be set aside.


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