The main legal point established is that the conversion of funds entrusted to an individual for specific purposes, failure to account for the remaining sum, and non-fulfillment of the promise to remit the balance constitutes criminal breach of trust under S.408, I.P.C.

1. The State appeals against the acquittal of the accused in this case of a charge under S.408, I.P.C.

2. The following facts, are proved and are undisputed. The accused was a Director and the paid Secretary of the Balussery Producers' cum Consumers' Co-operative Society, and Pw. 4 was its President. Under bye-law 19(a) of the bye-laws of the Society, a copy of which has been marked as Ext. P-11, the president is its ex-officio treasurer and is in charge of all its properties.' Under bye-law 19 (b), the Secretary is its executive head and carries on the administration subject to the general control of the President. For the purpose of carrying on the day to day administration, the Secretary is, from time to time, entrusted with the funds of the Society to the extent necessary, and bye-law 20 (b) lays down that the Secretary shall not keep more than Rs. 5000 at a time including the amounts with the procurement or other agents. (Even so, the evidence for the prosecution is that all cash in his hands should be kept in the Society's safe and should, along with the vouchers for any advances made, be available for check by inspecting officers). On 1-9-1954, the accused drew a sum of Rs.1000 from the funds of the,Society passing the receipt, Ext. P-6, in the following terms: "Received from the Balsurry P.C.C.S. Ltd., Rs. 1000 being the

advance for remittance, of audit fee. On 8-10 -1954 he drew Rs. 4800 being as the receipt, Ext. P-2, passed by him states, "the advance to meet the bill of workshop, petrol bill and the spare parts of the lorry". Ext. P-2, but not Ext. P-6, was passed by the President, Pw. 4, but the President being the treasurer in custody of the funds of the Society, it may be taken that in both cases the accused was entrusted with the money by Pw. 4 for the purposes mentioned in the receipts. On 12-10-1954 Pw. 2, one of the directors of the Society, made the complaint, Ext. P-1, to the District Collector (who is the Registrar for P.C.C. Societies) alleging that the accused and Pw. 4 were misappropriating the funds of the Society. The Collector directed Pw. 1, the District Supply Officer, to enquire into the matter and, accordingly, Pw.1 went to the Society on 15-10-54 and examined and seized its account books as also Ext. P-2 and Ext. P-6 and other vouchers. The accused was not available for examination on that day, but he appeared before Pw.1 on 15-10-1954 and, on being questioned with reference to the vouchers and the accounts, he made the statements, Ext. P-8, the relevant portions of which may be reproduced. "

As regards voucher No. 425 (Ext. P-6) for Rs. 1000 even though I had paid Rs. 679 and Rs. 231, the balance of Rs. 90 was also expended. This should be seen in the suspense register. Regarding voucher No.501 (Ext. P-2) for Rs. 4800,1 have since remitted Rs. 497-6-9 and Rs. 315-13-4. The balance is with me. I am keeping it as it is sometimes difficult to meet the president. Payments are made by me towards expenses and then adjusted. I shall remit the balance immediately I have not utilised any amount for my own purposes. I cannot say whether the President has utilised any money for his own private purposes".

3. It may be noted that neither advance was entered in Ext. P-4 the suspense account, in which they ought to have been entered. Apart from the sums mentioned by him in Ext. P-8 (which the prosecution accepts were duly accounted for) the accused had accounted for a sum of Rs. 8 by way of travelling expenses on 20-9-1954, and for a further sum of Rs. 100-11-6 on 15-10-1954.On'6-11-1954 he accounted for a sum of Rs. 640-11-2, but for the balance of Rs.3327-5--3, 'he has not to this date accounted. It is in respect of this sum that he was charged with breach of trust. (The charge, however, mentions the amount as Rs. 3558-5-3, the payment of Rs 231-0-0 admittedly made by the accused out of the advance of Rs. 1000 being missed apparently by oversight).

4. When questioned under S.342, Crl. P. C. with re