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1997 Supreme(P&H) 343
PUNJAB & HARYANA HIGH COURT
M.L.Singhal, J.
Dalip Singh
Versus
State Of Haryana
Criminal Revision No. 784 of 1994,
Decided On : FEBRUARY 19, 1997
A person entrusted with funds in a fiduciary capacity, such as a Secretary of a Co-operative Society, has a legal obligation to account for those funds and any misappropriation of such funds constitutes a criminal offense under Section 408 of the Indian Penal Code.
Headnote:
CRIMINAL REVISION - SECTION 408 OF THE INDIAN PENAL CODE - SECRETARY OF CO-OPERATIVE SOCIETY - MISAPPROPRIATION OF FUNDS - CONVICTION AND SENTENCE - REVISION PETITION - RELIEF UNDER PROBATION OF OFFENDERS ACT, 1958.
Fact of the Case:
Dalip Singh, the petitioner, was convicted and sentenced for misappropriating funds of the Dobi Co-operative Credit and Service Society while serving as its Secretary. He challenged the conviction and sentence in a revision petition, claiming he was merely a helper and not responsible for receiving or accounting for the funds.
Finding of the Court:
The court found that Dalip Singh was indeed the Secretary of the Society and that he had received and misappropriated funds from loanees and shareholders. The court held that the prosecution had proved the entrustment of funds to Dalip Singh and that he had failed to account for them, establishing the offense under Section 408 of the Indian Penal Code.
Issues: 1. Whether Dalip Singh was the Secretary of the Dobi Co-operative Credit and Service Society and had the authority to receive and account for funds. 2. Whether the prosecution had proved the entrustment of funds to Dalip Singh and his subsequent misappropriation of those funds.
Ratio Decidendi: The court relied on evidence such as resolutions appointing Dalip Singh as Secretary, entries made by him in passbooks of loanees and shareholders, and audit reports indicating misappropriation of funds. The court held that the entrustment of funds to Dalip Singh as Secretary created a fiduciary relationship between him and the Society, and his failure to account for the funds constituted a breach of that trust.
Final Decision: The court upheld the conviction of Dalip Singh under Section 408 of the Indian Penal Code but set aside the sentence of imprisonment. Considering the long duration of the trial and the fact that Dalip Singh had been facing uncertainties for over 20 years, the court directed him to execute bonds under the Probation of Offenders Act, 1958, and deposit a sum of Rs. 50,000/- in the Society's account in installments. Failure to comply with these conditions would result in the imposition of the original sentence.
M.L.Singhal, J.
1. This Criminal revision is directed against the judgment and order dateD 25.10.1994, passed by Shri V.S. Malik, Additional Sessions Judge, Hisar, in Criminal Appeal No. 13 of 1991, whereby he has convicted Dalip Singh-revision petitioner, herein, under Section 408 of the Indian Penal Code and sentenced him to undergo rigorous imprisonment for a period of one year and to pay fine of Rs. 1,000/- or in default to undergo further rigorous imprisonment for three months, thereby dismissing the appeal against conviction and affirming the sentence recorded against him, by Shri P.L. Ahuja, Additional Chief Judicial Magistrate, Hisar, vide order dated 27.2.1991.
2. Briefly stated the facts of the prosecution case are as under :-
Dalip Singh was Secretary of Dobi Co-operative Credit and Service Society between 23.12.1975 to 6.10.1976. According to the prosecution, he had received a sum of Rs. 22,890.21 from different loanees on account of repayment of the loans by them and the amount of shares from the members of the society. He did not deposit the amount in the credit of the Society nor did he account for the amount and misappropriated the amount although he had been asked time and again by the Inspector, Co-operative societies Hisar, to deposit the amount due to the Society received by him from the loanees of the Society and the shareholders of the society. An Audit was carried out on the account of the Society under the orders of the Assistant Registrar, Co- operative Societies, Hisar and during the course of audit, it was found that he had embezzled an amount of Rs. 22,899.21. Assistant Registrar, Co- operative Societies, Hisar, wrote letter to the Senior Superintendent of Police, Hisar, Ex. PW.9/A requesting him to register the case against the accused-Dalip Singh for having misappropriated funds of the Society. Case FIR No. 2 dated 6.1.1978 was registered against the accused under Section 409 of the Indian Penal Code at Police Station Sadar, Hisar. After investigation, accused was challaned under Section 409 of the Indian Penal Code. Shri Arjan Singh, Additional Chief Judicial Magistrate, Hisar, charged the accused under Section 409 of the Indian Penal Code, vide order dated 19.4.1983. Accused pleaded not guilty to the charge and claimed trial.
3. At the trial, the prosecution examined a number of witnesses namely Jai Singh, PW-1, Hari Singh, PW-2, Masuadi Ram, PW-3, Bhagtu, PW-4, Neki Ram, PW-5 and others.
4. Accused when examined under Section 313 of the Criminal Procedure Code, denied the imputations appearing in prosecution evidence against him and stated that he was merely a helper; he had nothing to do with the receipt of loans from the loanees of the Society or any shareholders of the Society; Sube Singh was then Secretary of Dobi Co-operative Credit and Service Society; he was the nephew of Shri Amar Singh, Inspector, Co-operative Societies and he was implicated falsely by Shri Amar Singh, Inspector, Co-operative Societies with the object of shielding his nephew.
5. At the conclusion of the trial, Shri P.L. Ahuja, Additional Chief Judicial Magistrate, Hisar found the charge under Section 408 Indian Penal Code, proved against him and he found that an amount of Rs. 15,627.21 belonging to the Society had been misappropriated by him. He convicted him and sentenced him as indicated above.
6. Shri V.S. Malik, Additional Sessions Judge, Hisar, dismissed his appeal against conviction and sentence as indicated above.
7. It has been submitted by the learned Counsel for the petitioner that petitioner was not Secretary of the Dobi Co-operative Credit and Service Society and he was merely a helper. It was not his duty to receive monies on behalf of the Society nor did he receive any monies on behalf of the Society. In my opinion, this submission is not borne out from the evidence brought on the record by the prosecution. Though in revision, normally reappraisal of evidence is not undertaken, in this revision, r
