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2010 Supreme(Guj) 268
2010 (3) GCD 2022 (Guj)
Hon’ble Mr. Justice Akil Kureshi
Samar Nath
Versus
State of Gujarat & Anr.
Criminal Misc. Application No. 12172 of 2009—Decided on 27/08/2010
Appearance :
Ms. Paurami B. Sheth, for the Applicant No. 1.
Mr. Manav A. Mehta, for the Applicant No.1.
Ms. M.L. Shah, APP for the Respondent No. 1.
Mr. Pravin Gondaliya, for the Respondent No. 2.
Point in Issue :
Whether criminal proceeding for criminal breach of trust against petitioner is sustainable?
Headnote:Head Note :
[Indian] Penal Code, 1860 (Central Act 45 of 1860) — Sections 407 read with 34 and 114 — Sale of Goods Act — Sections 47 and 50 — Criminal Procedure Code, 1973 — Section 482 — Quashing of criminal proceedings — Offences of breach of trust — No ingredient of entrustment of property made out — Nor any vicarious liability established — Petitioner is Managing Director of transporter company of the purchaser company and not the seller company i.e. complainant — Purchaser company used to pay transportation charges to transporter company — Therefore, even after instructors by complainant company if the goods are delivered to purchaser company no offence of breach of trust is made out.
Held :
Court find that in the complaint, complainant has made allegations about goods being handed over to the purchaser company despite instructions to the contrary from the complainant. However, nowhere in the complaint, the complainant has alleged what role did the present petitioner play except for stating that present petitioner who is shown as accused No. 1 is the Managing Director of APL Logistics (India) Pvt. Ltd. and is responsible for day to day functioning and that he is responsible for transactions described in the complaint. There is no allegations made individually against the present petitioner. Though in the complaint general allegations is made against both the accused including the present petitioner, such allegations need to be viewed in light of correspondence between the parties which is produced on record. All the correspondence mainly through e-mail is with representative of the APL Logistics (India) Pvt. Ltd. and not the present petitioner. As already noted, case of the complainant is that APL Logistics (India) Pvt. Ltd. was entrusted with the task of transporting consignment from Mumbai to USA. While the goods was in transit, complainant came to know that buyer company has gone bankrupt. Instructions was therefore, issued to APL Logistics (India) Pvt. Ltd. to withhold the delivery of consignment. Despite such clear instructions, goods was delivered to the purchaser company. Nowhere the complaint suggests that there was any direct dealing with accused No. 1 i.e. the present petitioner. Nowhere complaint suggests that instructions was given to him personally and that the said accused had committed breach of trust and thus committed offence under Section 407 of IPC. [Para 5]
It thus becomes clear that the APL Logistics (India) Pvt. Ltd. was acting as transporter of the purchaser company and not the seller company i.e. the complainant. It appears that transportation charges has also been paid by the purchaser company. Complainant company has not produced any record to suggest that such charges was borne by them. Under the circumstances, Court find that APL Logistics (India) Pvt. Ltd. was under no legal obligation to withhold the delivery of the goods at the instance of the complainant company. [Para 9]
It is, therefore, important that property should has been entrusted to the accused for offence of criminal of breach of trust. In the present case, as already held APL Logistics (India) Pvt. Ltd. was agent of the purchaser company. Its possession of goods cannot be termed as entrustment by the complainant company. No offence of criminal breach of trust is therefore, made out. Question of such offence being committed by carrier therefore, would not arise. [Para 13]
In the result, Court find that no offence under Section 407 of IPC is disclosed against the petitioner. Complaint therefore is required to be quashed qua the petitioner. [Para 15]
Law Laid Down :
In absence of proof of entrustment of property to accused offence of criminal breach of trust can not be held to be made out.
Akil Kureshi, J.—The petitioner is the original accused. He seeks quashing of Criminal Case No. 1182/2009 (here-in-after referred to as ‘the said complaint’) pending before the learned JMFC, Sanand.
2. Briefly stated facts are as follows :
2.1 Petitioner is the original accused No. 1 in said complaint lodged by Respondent No. 2 herein. Briefly stated allegations in the complaint are that Respondent No. 2 is a manufacturer of cotton products. It sells goods mostly through exports. One of the customers of the complainant is one America based company called Mervyns L.L.C. (here-in-after referred to as ‘the purchaser company’). The purchaser company places purchase order with the complainant company. As per the purchase order complainant company entrusts transport of such export consignment to APL Logistics (India) Pvt. Ltd. at Mumbai. It may be noted that the petitioner is Managing Director of said APL Logistics (India) Pvt. Ltd. Such consignment is transported to its destination in USA by APL Logistics (India) Pvt. Ltd. through the vessels of Orient Oversees Container Line (India) Pvt. Ltd. (‘OOCL’ for short) of which original accused No. 2 is stated to be the Managing Director. It is stated in the complaint that for such transport work, the complainant pays the charges to the accused. Accused was responsible for safe transport of the goods. Accused had to carry out instructions of the complainant company till the goods could be handed over to the purchaser company. In June-July 2008, purchaser company placed large purchase order with the complaint company details of which are given in the complaint. Complainant company handed over the consignment to the accused which loaded in the ship for transport. At that point of time the complainant company came to know that purchaser company has gone bankrupt. They had also filed for bankruptcy according to American law. Complainant company thereupon instructed the accused not to deliver the goods to the purchaser company. Such instructions were duly received by the accused. In fact they were informed that if such instructions are ignored they would be directly liable for such actions. The accused ignored such instructions though they were duty bound to carry out instructions of the complainant company. Even when the goods were on high sea, such instructions were given despite which goods which were entrusted to the accused, were handed over to the purchaser company. It is thus the allegation of the complainant that accused committed offence punishable under Section 407 read with Sections 34 and 114 of the IPC for the goods which are valued at approximately Rs. 94,63,424/-.
2.2 On the said complaint, learned Magistrate recorded the statement of the complainant and on 28.1.2009 ordered police investigation under Section 202 of the Code of Criminal Procedure. Upon presentation of the report by the police, learned Magistrate by his order dated 4.7.2009 directed registration of the complaint and ordered issuance of summons. Petitioner therefore, challenges the complaint and order of Magistrate upon such complaint.
2.3 Case of the petitioner broadly is that APL Logistics (India) Pvt. Ltd. is not the agent of complainant company. It was receiving goods on behalf of the purchaser company. Payment for transportation was being made by the purchaser company. Its liability was limited and that too was to the purchaser company. At the time when the instructions were given by the complainant company, the goods were already in possession of OOCL. It is also the case of the petitioner that APL Logistics does not come within the definition of term ‘Carrier’. It is therefore, the case of the petitioner that in absence of any entrustment, offence of criminal breach of trust that too by carrier is not made out. Case of the complainant emerging from the complaint as well as from the affidavits and documents produced on record is that APL Logistics (India) Pvt. Ltd. were entrusted a consignment for transp
