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1967 Supreme(AP) 68
ANDHRA PRADESH HIGH COURT
ANANTANARAYANA AYYAR, J.
Public Prosecutor (A.P.) - Appellant
v.
Bheemanathi Venkata Seshaiah - Respondent.
Criminal Appeal No. 109 of 1965
Decided On : 27-6-1967
K. Jayachandra Reddy, for Appellant; K. Somakonda Reddy, for Respondent.
The President of a Co-operative Society is an agent and not a servant of the Society, and therefore cannot be convicted under S. 408, I.P.C., for criminal breach of trust.
Headnote:
CRIMINAL BREACH OF TRUST - PRESIDENT OF CO-OPERATIVE SOCIETY - CHARGE UNDER S. 408, I.P.C. - CONVICTION UNDER S. 406, I.P.C. - EXTENTUATING CIRCUMSTANCES - SENTENCE.
Fact of the Case:
The accused, as President of a Co-operative Society, was charged with criminal breach of trust under S. 408, I.P.C., for not producing a cash balance of Rs. 3325.76 during an inspection by the Senior Inspector of Co-operative Societies. The accused claimed that he had credited the money and that only Rs. 700/- was available on that day.
Finding of the Court:
The court found that the accused had not produced the cash balance and that he had not given any explanation for its absence. The court also found that the accused had confessed to spending the money in his sworn statement, Ex. P-10, which was not properly proved. However, the court held that the accused could not be convicted under S. 408, I.P.C., as he was an agent and not a servant of the Co-operative Society. The court convicted the accused under S. 406, I.P.C., and sentenced him to pay a fine of Rs. 500/- or in default to undergo rigorous imprisonment for six months.
Issues: 1. Whether the accused was a servant or an agent of the Co-operative Society. 2. Whether the accused had committed criminal breach of trust. 3. Whether the accused was entitled to any extenuating circumstances.
Ratio Decidendi: 1. The court held that the accused was an agent and not a servant of the Co-operative Society, based on the bye-laws of the Society. 2. The court found that the accused had not produced the cash balance and that he had not given any explanation for its absence. The court also found that the accused had confessed to spending the money in his sworn statement, Ex. P-10. 3. The court considered the fact that the accused had paid the entire amount with interest to the Society before the charge-sheet was filed as an extenuating circumstance.
Final Decision: The court allowed the appeal, set aside the order of acquittal, and convicted the accused under S. 406, I.P.C. The accused was sentenced to pay a fine of Rs. 500/- or in default to undergo rigorous imprisonment for six months.
On a police charge sheet, the learned Judicial Second Class Magistrate, Nandikotkur, framed a charge against the sole accused, Bheemanthi Venkata Seshaiah, as follows :
"That you on or about the 6th day of May 1962 at Miduthur being the President of Weaver's Co-operative Society, Miduthur and in such capacity entrusted with monies of the Society committed criminal breach of trust in respect of the said money of Rs. 3326-26 and thereby committed an offence punishable under S. 408 of the Indian Penal Code and within my cognizance." After full trial, the learned Magistrate acquitted the accused. Thereupon, the learned Public Prosecutor filed this appeal against the acquittal.
2. The prosecution examined three witnesses. Of these, P. W. 1 was the Senior Inspector of Co-operative Societies. P. W. 2 was the then Deputy Registrar of Co-operative Societies who made a complaint, Ex. P-14, to the Superintendent of Police, Kurnool, and P. W. 3 was the Sub-Inspector of Police, Miduthur who investigated the case and filed the charge sheet against the accused under S. 408, I. P.C.
3. The case of the prosecution is as follows. There was a Co-operative Society in Midathur called Midathur Weaver's Co-operative Production and Sales Society. On 18-12-1960, the accused was elected as Director of that Society and subsequently as President. Exs. P-3 and P-4 are the entries in the Minute Book showing such an election. Ex. P-6 is the Bylaws of the Society which runs as follows :
"The President shall have the general power of superintendence over all affairs of the society and shall, by virtue of his office, be the treasurer also and shall keep all property of the society under his possession." In his capacity as President and as also the ex-officio Treasurer, the accused received and made payments and was in possession of cash balance. Ex. P-7 is the cash book containing entries from 2-7-61 to 6-5-62. At the end of every day there is the signature purporting to be of the accused regarding the closing figures of the day including the closing cash balance. At p. 76 of the cash book, there is an entry bearing the signature of the accused showing the cash balance in figures as well as in words as Rs. 3325-76. The accused has signed his name over the designation "President."
4. On an order, ex. P-1 dated 25-5-62, passed by the Deputy Registrar of Co-operative Societies, Kurnool, the Senior Inspector of Co operative Societies, P. W. 1, conducted enquiries under S. 38 of the Andhra Pradesh Cooperative Societies Act. In the course of the enquiry, he asked the accused to produce before him the cash balance which was shown on 6-5-62 as the last entry viz., Rs. 3325.76. The accused did not and could not produce the cash balance. On 7-7-62, P. W. 1 recorded the sworn statement. Ex. P-10, from the accused regarding the various matters which were the subject matter of the enquiry. In paragraph 12 of that statement, regarding the cash balance, the accused stated as follows :
"Regarding the present Chitta balance of Rs. 3325-76 and sum of Rs. 200 is due in respect of cloths given in Anamath account. Regarding the remainder, I spent a sum of Rs. 400 to meet the society expenses and out of the remainder I gave hand loans of Rs. 215 and Rs. 240 to Chinna Venkataswami and Gontumukkala Naganna respectively. It is true that I spent the remainder, this is, for my family expenses, that is for my family maintenance.
* * * * *
As regards the present chitta balance, I will, before 10-8-62, remit into the Central Bank, Kurnool a sum of Rs. 1000 (in words rupees one thousand). As regards the balance I will remit the same into the Central Bank, Kurnool after meeting the members."
5. In pursuance of the undertaking given by him, the accused deposited the amounts as follows:
7-1-1963 ... Rs. 1000/-
3-9-1963 ... 1000/-
12-10- 1963 ... 27/-
16-12-1963 ... 200/-
24-2-1964 ... 1098-76 NP.
24-7-1964 ... 428-71 towards interest.
Thus the accused made good the entire amount of cash balance and
