RAGHUBAR DAYAL,

(1) THESE three appeals are by special leave. Appeal No. 7 of 1961 is by R. K. Dalmia. Appeal No. 8 of 1961 is by R.P.Gurha. Appeal No. 9 of 1961 is by G.L.Chokhani and Vishnu Prasad. All the appellants were convicted of the offence under s. 120 read with s.409 Indian Penal Code, and all of them, except Vishnu Prasad, were also convicted of certain offences arising out of the overt acts committed by them. Dalmia and Chokhani were convicted under s. 409 Indian Penal Code Chokhani was also convicted under s. 477A read with s. 110, I. P. C. Gurha was convicted under s. 477A I. P. C.

(2) TO appreciate the case against the appellants, we may first state generally the facts leading to the case. Bharat Insuirance Company was incorporated in 1896. In 1936, Dalmia purchased certain shares of the company and became a Director and Chairman of the company. He resigned from these offices in 1942 and was succeeded by his brother J. Dalmia. The head office of the Bharat Insurance Company was shifted from Lahore to 10, Daryaganj, Delhi. in 1947. Dalmia was co-opted a Director on 1/03/1949 and was again elected Chairman of the company on 19/03/1949 when his brother J. Dalmia resigned.

(3) R. L. Chordia, a relation of Dalmia and principal Officer of the Insurance Company, was appointed Managing Director on 27/02/1950. Dalmia was appointed Principal Officer of the company with effect from 20/08/1954. He remained the Chairman and Principal Officer of the Company till 22/09/1955. The period of criminal conspiracy charged against the appellant is from August 195 4/09/1955. Dalmia was therefore, during the relevant period, both Chairman and Principal Officer of the Insurance Company.

(4) DURING this relevant period, this company had its current account in the Chartered Bank of India, Australia and China Ltd. (hereinafter called the Chartered Bank) at Bombay. The Company also had an account with this bank for the safe custody of its securities the company also had a separate current account with the Punjab National Bank, Bombay.

(5) AT Delhi, where the head office was, the company had an account for the safe custody of securities with the Imperial Bank of India, New Delhi.

(6) EXHIBIT P-785 consists of the Memorandum of Association and the Articles of Association of the Bharat Insurance Company. Articles 116 and 117 deal with the powers of the Directors.

(7) EXHIBIT P-786 is said to be the original Byelaws passed by the Directors on 8/09/1951. The pages are signed by K.L. Gupta, who was the General Manager of the company during, the relevant period, and not by Dalmia the Chairman, as De should have been the case in view of the resolution dated 8/05/1951. The genuineness of this document is not, however, admitted.

(8) EXHIBITS P-15 and P-897 are said to be copies of these Bye- laws which were sent to Shri K. Annadhanam (Chartered Accountant, appointed by the government of India on 19/09/1955, to investigate into the affairs of the Bharat Insurance Company under s. 33(1) of the Insurance Act) and to the Imperial Bank of India, Now Delhi, respectively, and the evidence about their genuineness is questioned.

(9) BYE-LAW 12 deals with the powers of the Chairman. Clause (b)) thereof empowers the Chairman to grant loans to persons with or without security, but from 30/08/1954, the power was restricted to grant of loans on mortgages. Clause (e) empowers the Chairman to negotiate transfer buy and sell government Securities and to pledge, indorse, withdraw or otherwise deal with them.

(10) ON 31/01/1951, the Board of Directors of the Insurance Company passed resolutions to the following effect : (1) To open an account in the Chartered Bank at Bombay. (2) To authorise Chokhani to operate on the account of the Insurance Company.(3) To for the keeping of the government securities had by the company, in safe custody, with the Chartered Bank. (4) To instruct the Ban