1. Embezzlement of government funds — Conviction under Indian Penal Code — Attachment and forfeiture of property under Criminal Law Amendment Ordinance, 1944. (Para 1 , 2 , 3 )
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1962 Supreme(SC) 158
SUPREME COURT OF INDIA
B.P. SINHA, C.J.I., P.B. GAJENDRAGADKAR, K.N. WANCHOO, N. RAJAGOPALA AYYANGAR AND T.L. VENKATARAMA AYYAR, JJ.
The State of W.B., Appellant
Versus
S. K. Ghosh, Respondent.
The Attorney-General for India, Intervener.
Criminal Appeal No. 140 of 1959.
Advocates appeared
Mr. B. Sen, Senior Advocate (M/s. P. K Chatterjee and P. K. Bose, Advocates, with him) for Appellant; Mr. N.C. Chatterjee, Senior Advocate. (Mr. S.C. Mazumdar, Advocate, with him) for Respondent ; Mr. C.K Daphtary, Solicitor-General of India (M/s. B.R.L. Iyengar and P. D. Menon, Advocates, with him) for Intervener.
Forfeiture of property under the Criminal Law Amendment Ordinance, 1944, for the recovery of embezzled government funds is a recovery mechanism and not a "penalty" under Article 20(1) of the Constitution, and is therefore not barred as an ex post facto law.
Headnote:(A) Criminal Law Amendment Ordinance, 1944 - Sections 3, 12 and 13 - Criminal Law Amendment Ordinance, 1943 - Section 10 - Constitution of India - Article 20(1) - Indian Penal Code - Sections 120B, 409 and 53 - Forfeiture of property - Recovery of embezzled money - Forfeiture provided under Section 13(3) of the 1944-Ordinance is a method of recovering money belonging to the Government and not a penalty or punishment within the meaning of Article 20(1) of the Constitution (Paras 14, 15). A finding as to the amount of money procured by the offence for the purpose of imposing a minimum fine under Section 10 of the 1943-Ordinance is sufficient compliance with Section 12(1) of the 1944-Ordinance (Paras 10, 11). The criminal court is required to determine the value of property actually procured by the offence, not the value of other property attached for recovery purposes (Para 12).
Facts of the case:
A public servant was convicted of conspiracy and criminal breach of trust for embezzling government funds. Certain properties were attached under the 1944-Ordinance. Following the conviction and a judicial finding that a specific amount had been misappropriated, the District Judge ordered the forfeiture of attached properties to the value of the misappropriated amount. The High Court quashed this order, holding either that the procedural requirements of Section 12 were not met or that the forfeiture constituted an ex post facto penalty violating Article 20(1) of the Constitution.
Findings of Court:
The District Judge had jurisdiction to order forfeiture. The finding of the amount procured by the offence in the criminal judgment is sufficient for the District Judge to determine the amount to be forfeited. Forfeiture under the 1944-Ordinance is a recovery mechanism, not a punishment.
Issues: (i) Whether a finding under Section 10 of the 1943-Ordinance suffices as a finding under Section 12(1) of the 1944-Ordinance; (ii) Whether the criminal court must value all attached properties under Section 12(1); and (iii) Whether forfeiture under Section 13(3) of the 1944-Ordinance is a penalty hit by Article 20(1) of the Constitution.
Ratio Decidendi: Forfeiture under Section 13(3) of the 1944-Ordinance is a speedier method of realizing government money or property and not a penalty under Article 20(1), as it is an order of recovery passed by a civil court, unlike the punitive forfeiture under Section 53 of the Indian Penal Code. Furthermore, a finding on the amount procured by the offence for sentencing purposes satisfies the requirement for forfeiture proceedings, and the criminal court's duty to value property is limited to that actually procured by the offence, not other attached assets.
Result: Appeal allowed.
Legal Category Hierarchy
- crime and sentencing
- constitutional law
- practice and procedure
Table of Contents
2. Whether forfeiture requires a specific finding under Section 12, 1944 Ordinance — Whether such forfeiture constitutes a penalty barred by Article 20(1) of the Constitution. (Para 4 , 5 , 6 , 7 )
3. Finding of amount procured for fine satisfies Section 12 requirements — Forfeiture under 1944 Ordinance is a recovery mechanism for government funds, not a penal sanction. (Para 8 , 9 , 10 , 11 , 12 , 14 , 15 )
4. Forfeiture of embezzled government property is a recovery measure rather than a penalty, thus not violating the constitutional prohibition against ex post facto laws. (Para 14 , 15 )
5. Appeal allowed — High Court order set aside — District Judge's order for forfeiture restored. (Para 18 )
6. Does a finding of the amount procured for the purpose of imposing a fine under the 1943 Ordinance satisfy the requirements of Section 12(1) of the 1944 Ordinance?
Yes. A finding as to the amount of money or value of property procured by the offender, even if made for the purpose of determining a minimum fine under Section 10 of the 1943 Ordinance, satisfies the requirement of Section 12(1) of the 1944 Ordinance. (Para 10 , 11 )
7. Is the criminal court required to value the properties attached under Section 3 of the 1944 Ordinance before forfeiture?
No. The criminal court only determines the amount of money or value of property procured by the offence. The valuation of the attached property, which may be different from the procured property, is the jurisdiction of the District Judge during forfeiture proceedings. (Para 12 )
8. Does the forfeiture of property procured by an offence under Section 13(3) of the 1944 Ordinance constitute a penalty barred by Article 20(1) of the Constitution?
No. Forfeiture under Section 13(3) is a method of recovering government money or property embezzled by the offender, acting as a speedier remedy than a civil suit, and is not a penalty or punishment for the offence. (Para 14 , 15 )
Judgment
WANCHOO, J.: This is an appeal on a certificate granted by the Calcutta High Court. The respondent was appointed the Chief Refugee Administrator of the Burma Refugee Organisation in November 1942 and held that post till August 25, 1944, when he was suspended. He was believed to have embezzled large sums of money belonging to Government which were at his disposal as the Chief Refugee Administrator in conspiracy with certain persons. It was in that connection that he was suspended on August 25, 1944 and investigation into the alleged offences began thereafter. In that connection, the respondent was arrested in October 1914 and was bailed out. Eventually on July 21, 1945 the respondent was prosecuted under Ss. 120B and 409 of the Indian Penal Code before the Second Special Tribunal constituted under the Criminal Law Amendment Ordinance No. 29 of 1943 (hereinafter referred to as the 1943-.Ordinance). In the meantime, the Criminal Law Amendment Ordinance No. 38 of 1944 (hereinafter referred to as the 1944-Ordinance) was passed. The object of this Ordinance was to prevent the disposal or concealment of money or other property procured by means of certain scheduled offences punishable under the Indian Penal Code, and one of the offences to which this Ordinance applied was S. 409 of the Indian Penal Code, and any conspiracy to commit such offence, Section 3 of this Ordinance provided that where the Provincial Government had reason to believe that any person had committed (whether after the commencement of this Ordinance or not) any scheduled offence the Provincial Government was empowered (whether or not the Court had taken cognizance of the offence) to make an application to the District Judge within the local limits of whose jurisdiction the said person ordinarily resided or carried on his business, for the attachment of the money or other property which the Provincial Government believed the said person to have procured by means of the offence. But if for some reason such money or property could not be attached, the Provincial Government was given power to apply for the attachment of other property of the said person of value as nearly as might be equivalent to that of the aforesaid money or property. Section 3 therefore provided for something like what is attachment before judgment in a civil Court, and the Provincial Government was authorised to apply for attachment either of the money or property with respect to which the offence was said to have been committed and if that was not available, other property of equal value could be attached even though no offence had been committed with respect to that other property. Consequently, on November 21, 1944, an application was made on behalf of the Provincial Government before the District Judge for attachment of certain properties under S.13 of the 1944 - Ordinance on the ground that these properties had been purchased by the respondent with moneys procured by him by committing offences under Ss. 120-B and 409 of the Indian Penal Code. On February 22, 1945, another application was made for attachment of certain other properties. The District Judge ordered attachment of these two sets of properties after hearing the respondent and the orders of attachment have been extended from time to time. This took place even before the case of the respondent was sent up for trial before the Special Tribunal.
2. The respondent was eventually convicted by the Special Tribunal after a protracted trial on August 31, 1949. In the meantime the Criminal Law (1943 Amendment) Amending Ordinance No.12 of 1945, (hereinafter referred to as the 1945 - Ordinance) came into force on May 12, 1945. By this Ordinance, S.10 of the 1943-Ordinance was amended and the amended section was in these terms :
"When any person charged before a Special Tribunal with an offence specified in the Schedule is found guilty of that offence, the Special Tribunal shall, notwithstanding anything contained in the Indian Penal Cod
