The main legal point established in the judgment is that misappropriation of funds and cheating constitute offenses under the Indian Penal Code, regardless of any violation of foreign exchange regulations.

JUDGMENT

(Prayer: Criminal Appeal has been filed under Section 372 (2)of Cr.P.C., to set aside the order of acquittal made in C.A.No.158/2015 on the file of the XVII Additional Judge, City Civil Court, Chennai and restore the conviction in C.C.No.3933/2011 on the file of the XI Metropolitan Magistrate Court in the interest of justice.)

1. This Criminal Appeal is against the order of acquittal rendered by the lower Appellate Court reversing the judgment of conviction and sentence passed by the trial Court.

2. The appeal is by the defacto complainant, who initiated the criminal prosecution through his written complaint dated 20/01/2010 addressed to the Commissioner of Police, Egmore, Chennai alleging that, he is a resident of Malayasia. He started a company in India by name “Phonenix Technology Corporation Limited” having its registered office at Bangalore. He appointed his relative D.Kamaraj as a Director of the Company to be in-charge of the operation at Bangalore. Later, a Branch Office of the Company was started at Chennai to carry out the work for Southern Railways. D.Ramaraj, the brother of D.Kamaraj was appointed as Manager to look after the affairs of the Chennai Branch. The company could not make out any profit out of the contracts. Hence, operation at Bangalore office was closed in the year 2003 and D.Kamaraj was asked to take care of Chennai office along with his brother Ramaraj. To complete the contract works already undertaken at Chennai, he also infused fund of Rs.70 lakhs. However, the business did not improve. Then, Ramaraj promised to revive the company from its loses and sought salary of Rs.40,000/- p.m to carry out the liaison work on behalf of the Malaysian company. The house at No.41-B, Pasumarthy Street, Kodambakkam, Chennai was rented for the Chennai Branch and for stay of D.Ramaraj and D.Kamaraj. A room in it was reserved for the stay of the complainant, whenever he visit Chennai. In the year 2007, Ramaraj informed him that the landlord of the said premises Mrs.Malathy wants to sell the house and prompted him to buy it. He decided to buy the property and completed the deal for Rs.98 lakhs through Ramaraj. He gave Malaysian Ringgits equivalent to INR 34,00,000/- (Rupees Thirty Four lakhs) to Ramaraj, when he visited Malaysia during the month of March, 2007 as advance for the deal and the balance of Rs.64 lakhs paid through Bank Transfer in favour of Mrs.V.Malathy. Meanwhile, Jansipappa, the wife of Ramaraj sought financial help from him to redeem her mortgaged jewels and for that purpose, he gave Rs.9,50,000/- to Jansipappa in the month of September 2009.

3. Later, when he verified the documents, he came to know that the Ramaraj using the money given for purchase of the property in the name of the company acting as power agent of Vijayaragavan (the actual owner of the property), transferred the property in favour of his wife Jansipappa on 31/12/2009. Therefore, he questioned Ramaraj about his act of deceit. For which he sent a notice alleging the complainant owe him Rs .5 lakhs as reward for his service. On verification of the Company’s Chennai Branch accounts, he found that instead of receivable of Rs.70 lakhs, Ramaraj has falsified the accounts as if the receivable is only Rs.10 lakhs and had misappropriated the balance amount of Rs.60 lakhs. Hence, the complaint of cheating and misappropriation to a tune of Rs.1.6 crores by (i) Ramaraj, (ii) Jansipappa and (iii) V.Malathy.

4. This complaint was taken up for investigation by the Central Crime Branch in Crime No: 51 of 2010. On completion of investigation, final report filed against Ramaraj and his wife Jansipappa. The Court took the final report on file in C.C.No.3933/2011. Charges framed under Sections 408 and 420 r/w 34 IPC against first accused and under Sections 406 r/w 109 IPC and 420 r/w 34 IPC against the second accused. To prove the charges, the p