The main legal point established in the judgment is the interpretation of the necessity of sanction under S.197 Crl. P.C. for prosecuting a public servant, and the court's conclusion that no sanction was necessary for the prosecution of the accused for misappropriating the entrusted funds.

1. The accused in C.C. 77 of 1959 on the file of the District Magistrate of Palghat who had been convicted under S.409 I.P.C., and whose appeal before the Sessions Judge, Palghat had been dismissed has filed this revision petition. He was sentenced to rigorous imprisonment for one year by the District Magistrate, but in appeal the sentence was reduced to rigorous imprisonment for three months. On admission of the revision petition, notice has been issued to the accused to show cause why the sentence should not be enhanced and that is how it has come up before this Bench for hearing.

2. It is not disputed by the petitioner that monies were entrusted to him. On 5-5-57, Pw. 2 the then President of the Panchayat Board handed over charge to the petitioner who was then the Vice President. The balance cash on hand was also entrusted. The petitioner was thereafter functioning as Vice President, and being a minor Panchayat he was also the Executive Officer of the Panchayat. In that capacity he was the custodian of all the cash and all the account books and registers of the Panchayat Board. He was collecting monies and was in possession of the cash belonging to the Panchayat.

3. Pw. 3, the Deputy Panchayat Officer had audited the accounts of the Panchayat up to March 1957 on 3-8-1957. His next visit was on 18-1-1958. On that day the cash book showed a balance of Rs. 2365.28 besides the credit balances in the Sub-Treasury and Post Office. This cash balance ought to have been in the hands of the petitioner. The petitioner was not able to produce the cash balance when demanded. It was admitted by him that he had no cash with him on that day. This fact is seen recorded by Pw. 3 in Ext. P2 cash book. The relevant entry is Ext. P2 (a). The petitioner also gave a statement Ext. P 13 that he would remit the amount by 4-2-1958. Pw. 3 again inspected the office on 3-4-1958. The petitioner had not by then remitted any amount and he again gave a statement Ext. P14 asking for more time for payment of the amount. These statements are admissible in evidence. It cannot, therefore, be contended that there was no conversion of the amount for the accused's own use. The courts below have exhaustively discussed the evidence in the case and rightly found that the prosecution has conclusively proved entrustment and misappropriation. The learned counsel for the petitioner therefore has rightly not chosen to seriously argue this aspect of the case.

4. The main point that was pressed is that there was no proper or valid sanction obtained for the prosecution of the petitioner as is required under S.197, Crl. P.C., and consequently the initiation of the proceedings was illegal and without jurisdiction. What is contended is that there is nothing in the sanction order to show that sanction was given in respect of the facts constituting the offence or that the sanctioning authority was appraised of all the facts relating to the offence charged against the accused before sanction was accorded for the prosecution. It is also stated that the prosecution has not proved by any extraneous evidence that sufficient materials had been placed before the sanctioning authority.

5. Two things arise for consideration. Firstly whether sanction is really necessary for the prosecution of the petitioner for the offence under S.409, I.P.C., and secondly if it is necessary, whether the sanction given in this case Ext. P23 is valid and proper so as to confer jurisdiction on the Magistrate to try the case.

6. To determine the first question whether sanction was required it will be necessary to refer to the principles established by authoritative pronouncements on the subject both by their Lordships of the Privy Council, the Federal Court and lastly of the Supreme Court on the subject.

Hori Ram Singh v. Emperor (A.I.R. 1939 F.C. 43) is a decision of the Federal Court on the necessity for sanction under S.270 of the Government of India Act, 1935 which is similar in terms to S.197 (1),