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State of Kerala Vs. C.E. Mohammed Kutty, Inspector of Co-operative Societies - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtKerala High Court
Decided On
Judge
Reported in1963CriLJ360
AppellantState of Kerala
RespondentC.E. Mohammed Kutty, Inspector of Co-operative Societies
Cases ReferredLanier v. Rex
Excerpt:
.....circumstances of this 'case and it must fail. (c) of section 5(1). it is well settled that if a public servant dishonestly or fraudulently misappropriates property entrusted to him, he cannot be said to have been doing so in the discharge of his official duty vide the case of hori ram singh v. 8. the learned counsel who argued the case for the accused then submitted that mere retention of money would not amount to an offence and the prosecution has failed to prove in this case dishonest or fraudulent conversion of the money. ' wrongful gain includes wrongful retention and wrongful loss includes being kept out of the property as well as being wrongfully deprived of property. the principal ingredient of the offence being dishonest misappropriation or conversion which may not ordinarily..........cannot be said to have been made out as the entrust-ment of property is not in his capacity as public servant and the alleged misconduct was not committed in the discharge of his duty as a public servant. the state questions the legality of this finding in this appeal. the accuses appeared in person and argued the case. advocate sri k.p. radhakrishna menon appeared as amicus curiae to argue the' question of law and i wish to record my appreciation for the kind help rendered by him.4. the view taken by the learned special judge gains support from a decision of the supreme court reported in state of ajmer v. shivji lal : 1959crilj1127 . in that case the accused was a school teacher and the charge against him was that he had received money promising the complainant that he would secure.....
Judgment:

P. Govinda Menon, J.

1. This appeal is filed by the State against the judgment of the Special Judge of Trivandrum acquitting the respondent who was prosecuted under Section 5(2) read with Section 5(1)(c) and (d) of the Prevention of Corruption Act (Act II of 1947) hereinafter referred to as the Act.

2. The accused Sri Mohammadkutty was an Inspector in the Audit Section of the Co-operative Department In Kerala State. In 1956 he was in charge of the Kanjirappaiiy circle. Among the societies in his charge there were two societies, the Kappad Co-operative Society No. 980 and Upputhura Co-operative Society No. 2985. Yearly audit had to be conducted of these societies by the Co-operative Inspector and the society had to pay to the Government the audit fees. Audits for the year 1953-54 and 1954-55 were conducted by the predecessors of the accused and audit fees for that period were in arrears. The accused conducted the audit for the year 1955-55. On 27-6-56 he brought to the notice of Pw. 1 Sri Mathew the Secretary of the Society that audit fees for the previous years were in arrears and requested him for payment. P.W. 1 paid Rs. 28 - being the audit fees for the two previous years to the accused and the accused promised to remit the same into the treasury. The accused did not remit the money as agreed but utilised the amount for his own purposes. Similarly a sum of Rs. 15 was entrusted on 7-10-56 to the accused by Pw. 2 the Secretary of the Upputhura Society being the audit charges in arrears and a voucher Ext. P-6 was issued by the accused for receipt of the amount. This amount was also not remitted into the treasury, but appropriated by the accused. On a complaint regarding certain irregularities committed by the accused Pw. 3 the Deputy Registrar of Co-operative Societies conducted an enquiry and in the course of the enquiry the non-remittance of these amounts were noticed and the explanation of the accused was called for. On 16-6-1950 the accused remitted Rs. 24/- under chalan Ext. P-14 and the balance of Rs. 4/- was remitted in the treasury on 27-6-59 under chalan Ext. P-15. The amount received from Upputhura Society was remitted on 20-7-59 under chalan Ext. P-16. The matter was then reported to the X-Brancrt police who after obtaining necessary sanction investigated into the case and laid the charge sheet against the accused.

3. The receipt of the amount has not been denied by the accused even though in the case of Kappad Society he would have it that it was not Pw. 1 who entrusted the money to him but it was the peon Dw. 1 who gave 'him the money. That is quite immaterial. He also admitted that money was paid by Pw. 2 and that a voucher Ex. P-6 was issued by him. His contention is that the delay in remittance was due to pressure of work and not because he had misappropriated the amount. The learned Judge found entrustment and misappropriation duly proved by the prosecution but found the accused not guilty as it was not the duty of the accused to collect audit fees and remit: the same into the treasury and that an offence under Section 5(2) cannot be said to have been made out as the entrust-ment of property is not in his capacity as public servant and the alleged misconduct was not committed in the discharge of his duty as a public servant. The State questions the legality of this finding in this appeal. The accuses appeared in person and argued the case. Advocate Sri K.P. Radhakrishna Menon appeared as amicus curiae to argue the' question of law and I wish to record my appreciation for the kind help rendered by him.

4. The view taken by the learned Special Judge gains support from a decision of the Supreme Court reported in State of Ajmer v. Shivji Lal : 1959CriLJ1127 . In that case the accused was a school teacher and the charge against him was that he had received money promising the complainant that he would secure a job for him in the Railway Running Shed at ' Mount Abu. It was not a part of the duty of the accused to make any such appointment and the defence contention was that he could not be convicted for committing criminal misconduct within the meaning or Section 5(2) of the Act. The plea was accepted by the Supreme Court and it was held:

The offence under this provision consists of criminal misconduct in the discharge of his duty. In order, therefore, that this offence is committed there should be misconduct by the public servant in the discharge of his duty. In other words, the public servant must do something in connection with his own duty and thereby obtain money for himself or for any other person by corrupt or illegal means or by otherwise abusing his position. If a Public servant takes money from a third person in order to corrupt some-other public servant and there is no question of his misconducting himself in the discharge of his own duty, that action may be an offence under Section 161 of the Indian Penal code but would not be an offence under Section 5(2) read with Section 5(1)(d) of the Prevention of Corruption Act. The essence of an offence under Section 5(2) read with Section 5(1)(d) is that the public servant should do something in the discharge of his own duty and thereby obtain any valuable thing or pecuniary advantage for himself or for any other person by corrupt or illegal means or by otherwise abusing his position, The words 'by otherwise abusing his position' read along with the words 'in the discharge of his duty' appearing in Section 5(1)(d) make it quite clear that an offence under that section requires that the public servant should misconduct himself in the discharge of his own duty. In the present case, the accused was a teacher and it was no part of his duty to make appointments in the Running Shed at Abu Road. There would, therefore, be no question of his committing misconduct in the discharge of his duty when he took money for procuring a job for Prem Singh in the Running Shed. So far, therefore, as the charge under Section 5(1)(d) is concerned, we are of opinion that there was no question of the accused misconducting himself in the discharge of his own duty in the circumstances of this ' case and it must fail.

5. In a recent case reported in Dhaneshwar Narain Saxena v. The Delhi Administration : (1962)ILLJ142SC , a Government servant who had nothing to do with the issue of a gun licence received money for securing a licence for the complainant and he was prosecuted and convicted tinder Section 5(2) read with Section 5 (1)(d) of the Act. On appeal by special leave to the Supreme Court reliance was placed on the decision in : 1959CriLJ1127 for the contention that offence of criminal misconduct is not committed. The Bench hearing the case being of opinion that the above said decision required reconsideration referred the case to a larger Bench of five Judges.

His Lordship Sinha, C.J., delivering the judgment of the Bench pointed out that the mistake in the judgment in the earlier ruling in : 1959CriLJ1127 has arisen from reading the words 'in the discharge of his duty' which are part merely of the nomenalature of the offence created by the statute whose ingredients are set out in Sub-clause (a) to (d) that follow, as descriptive of an essential and additional Ingredient of each of the types of offence in the four subclauses and proceeded to say:

That that is the source of the mistake is apparent from the erroneous way in which the section has been quoted at P. 744 of the Supreme Court Report at P. 84 of AIR in the paragraph preceding the paragraph quoted above. The ingredients of the particular offence in cl. (d) of Section 5(1) of the Act are: (1) that he should be a public servant (2) that he should use some corrupt or illegal means or otherwise abuse his position as a public servant; (3) that he should have thereby obtained a valuable thing or pecuniary advantage; and (4) for himself or for any other person. In order to bring the charge home to an accused person under cl, (d) aforesaid of the section it is not necessary that the public servant in question, while misconducting himself, should have done so in the discharge of his duty. It would be anomalous to say that a public servant has misconducted himself in the discharge of his duty. 'Duty' and 'misconduct' go ill together. If a person has misconducted himself as a public servant, it would not ordinarily be in the discharge of his duty, but the reverse of it. That 'misconduct', which has been made criminal by Section 5 of the Act, does not contain the element of discharge of his duty by public servant, is also made clear by reference to the provisions of Cl. (c) of Section 5(1). It is well settled that if a public servant dishonestly or fraudulently misappropriates property entrusted to him, he cannot be said to have been doing so in the discharge of his official duty vide the case of Hori Ram Singh v. Emperor AIR 1939 FC 43. An application for special leave to appeal from that decision was refused by the Privy Council in Hori Ram Singh v. Emperor AIR 1940 PC 54. This Court, therefore misread the section when it observed that the offence consists in criminal misconduct in the discharge of official duty. The error lies in importing the description of the offence into the definition portion of it. It is not necessary to constitute the offence under cl. (d) of the section that the public servant must do something in connection with his own duty and thereby obtain any valuable thing or pecuniary advantage. It is equally wrong to say that if a public servant were to take money from a third person, by corrupt or illegal means or otherwise abusing his official position in order to corrupt some other public servant, without there being any question of his misconducting himself In the discharge of his own duty, he has not committed an offence under Section 5(1)(d), It is also erroneous to hold that the essence of an offence under Section 5 (2) read with Section 5(1)(d), Is that the public servant should do something in the discharge of his own duty and thereby obtain a valuable thing or pecuniary advantage.

6. In that case even though the offence that was under scrutiny was only under Section 5 (1)(d) the reasoning applies equally to the offence under Section 5(1)(c) also and in fact their Lordships have referred to the offence in Section 5(1)(c) also. Section 5 (2) is a new offence created by the Act in addition to the offences in the Penal Code, namely, those mentioned in Sections 161 and 409. The Legislature advisedly widened the scope of the offence by giving a very wide definition in Section 5 with a view to punish those who holding public offices come by money and misappropriate the same or who taking advantage of his official position obtains for himself or for any other person any valuable thing or pecuniary advantage.

7. In this case, the money came into the possession and control of the accused while he was functioning as a public servant. Pws. 1 and 2 would not have paid the money to the accused if he had not been a public servant. If after the money had so come under his control he misappropriates it the offence would be complete. Criminal misconduct by committing misppropriation need not be in the discharge of his duties as a public servant. It follows therefore that the accused if he is proved to have misappropriated the money 'would be guilty of the offence of criminal misconduct punishable under Section 5(2). of the Act and the order of acquittal would have to be set aside.

8. The learned Counsel who argued the case for the accused then submitted that mere retention of money would not amount to an offence and the prosecution has failed to prove in this case dishonest or fraudulent conversion of the money. The offence of which the appellant has been charged is under Section 5(2) read with Section 5(1)(c) of the Act The section reads as follows:

5 (1) A public servant is said to commit the offence of criminal misconduct in the discharge of his duty-(c) if he dishonestly or fraudulently misappropriate: or otherwise converts for his own use any property entrusted to him or under his control as a public servant or allow: any other person so to do,

The word 'dishonestly' is defined In Section 24 of the India Penal Code to be;

Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that 'dishonestly.

Fraudulently has been defined in the Indian Penal Code in Section 25 as follows:

A person is said to do a thing fraudulently if he does that thing with intent to defraud but not otherwise.' Wrongful gain includes wrongful retention and wrongful loss includes being kept out of the property as well as being wrongfully deprived of property. Therefore when a particular thing has gone into the hands of a servant he will be guilty of misappropriating the thing in all circumstances which show a malicious intent to deprive the master of it. Explanation I of Section 403 IPC. says:

A dishonest misappropriation for a time only is a misappropriation within the meaning of this section.

9. In the case in Krishna Kumar v. Union of India : 1959CriLJ1508 their Lordships of the Supreme Court have observed that the offence under Section 5(1)(c) of the Act Is the same as embezzlement which in English law is constituted when the property has been received by the accused for or in the name or on account of the master or employer of the accused and it is complete when the servant fraudulently misappropriates that property.

Reference was made to the decision in Lanier v. Rex 1914 AC 27.1 where the offence of embezzlement was described as a wilful appropriation by the accused of the property of another.

So the essence of the offence with which the accused is charged here is that he being a public servant collected the audit fees and fraudulently appropriated the money thus entrusted to him or which came under his control and deprived the owner, namely, the state of that property.

10. To establish a charge of criminal breach of trust, the prosecution is not obliged to prove the precise mode of conversion, misappropriation or misapplication by the accused of the property entrusted to him or over which he has dominion. The principal ingredient of the offence being dishonest misappropriation or conversion which may not ordinarily be a matter of direct proof, entrustment of property and failure in breach of an obligation, to account for the property entrusted, if proved, may in the light of other circumstances, justifiably lead to an inference of dishonest misappropriation or conversion.

11. In this case beyond stating that it was due to pressure of work that he failed to deposit the amount no evidence has been led by the accused to show as to what was the unusually heavy work that made him to forget his duty of depositing the money which he had collected. The amount from Kappad Society was collected in June 1956. It was in October 1955 that he collected the money from the Upputhura Society, So at least when that amount was collected he would have remembered about the earlier collection and non-remittance and if the amount had not been utilised by him and was in tact with him he would have deposited both the amounts in October 1956. On 9-6-59 Pw. 3 reported to the Registrar by Ext. P-9 about the accused receiving audit fees and not remitting the amounts in the treasury and that explanation had been called for from the accused. Even after explanation had been called for and he was reminded about the non-remittance he did not at once deposit the amount. On 9-6-59 the accused sent a list Ext. P-17 of audit fees collected by him from different societies. If he had not utilised those amounts but had merely retained it with him forgetting to deposit it in the treasury nothing prevented him from remitting the amounts on that day when the list was sent. Instead of that, he remitted the amount due from Kappad Society in two instalments. In Ext. P-17 the accused did not at all mention the receipt of the audit fees from the Upputhura society and when reminded about it he sent Ext. P-18 on 18-7-59 stating that he did not remember about the collection of audit fees from Upputhura society. If the monies collected had not been spent by him and was with him there would have been no occasion for the omission of the name of the society from the list Ext, P-17. He remitted the amount received from Upputhura Society only on 20-7-59. On a consideration of all these circumstances, there is no room for doubt that the accused; must certainly have utilised the amount for his own use and that accounted for his failure to remit it into treasury.! The mere fact that he subsequently remitted the amount into the treasury will not exonerate the accused. The! offence under Section 5(2) read with Section 5 (1)(c) is, therefore, clearly made out.

12. The only question that remains is about the sentence. Section 5(2) provides for awarding a minimum sentence of one year. The offence is serious and I do not find any extenuating circumstances which would reduce the gravity of the offence and entitle the accused to any tesser sentence.

13. The order of acquittal passed by the teamed Special Judge is set aside, the accused is found guilty and convicted under Section 5(2) read with Section 5 (1)(c) and he is sentenced to undergo rigorous imprisonment for one year.

The appeal filed by the State is allowed.


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