The central legal point established in the judgment is the requirement to establish mens rea or dishonest intention on the part of the accused in order to convict them of the offence of cheating under section 420 of the Indian Penal Code.

S.D.Bajaj, J.

1. Manager Chowra Bazar Branch of the New Bank of India Ltd. at Ludhiana wrote to the Senior Superintendent of Police, Ludhiana, on July 3, 1975 as follows

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2. Formal First Information Report No. 164 came to be registered on its basis in Police Station, Division No. 4 at Ludhiana at 10.00 A.M. on 3rd July, 1975. On being charged with the commission of the offence under section 420 of the Indian Penal Code accused Ramesh Kumar pleaded not guilty thereto and claimed to be tried. Vide its impugned judgment dated 6th November. 1981 learned lower Appellate Court acquitted him of charge holding that his liability towards the Bank was of civil nature and, therefore, set aside the conviction recorded by the learned trial court against him on 23rd July, 1980. Feeling aggrieved from judgment of acquittal aforesaid the State of Punjab has filed Criminal Appeal No. 113-DBA of 1983 in this Court.

3. We have heard Shri Randhir Singh, A.A.G. Punjab for the appellant State, Shri K.S. Ahluwalia, Advocate with Shri M.L. Saggar and Shri O.P. Sharma, Advocates, for the respondent and carefully scrutinized the relevant material on record.

4. The ingredients of the offence under section 420 are that the person deceived delivered to someone a valuable security or property, that the person so deceived was induced to do so, that such person acted on such inducement in consequence of his having been deceived by the accused and that the accused acted fraudulently or dishonestly when so inducing that person.

5. In order to constitute an offence or cheating it must be established that the accused deceived the complainant dishonestly inducing him to part with any property in his favour which he would not have parted but for the deception played on him. It is thus obvious that dishonest intention on the part of the accused at the time of making the representation to the complainant on the basis of which complainant parts with his property is an essential ingredient of the offence. In other words, mens rea on the part of the accused must be established before he can be convicted of an offence of cheating. PW3 Tarsem Lal Bank Managers states :-

"In 1975, I was posted in Choura Bazar, Ludhiana. I was working as a Manager since 1-9-1970. Our Bank was having accounts of M/s Vinod Trading Company and Vinod Woollens. These firms were having accounts with us since 1959. Again said M/s Vinod Trading had account since 1959. Both the firms were enjoying cash credit limit of rupees 7-1/2 lacs and rupees 5-1/2 lacs. These facilities were according to the Rules of the Bank. These limits were sanctioned by the head office. These facilities were subject to pledging of the goods (by these firms). Yarn of every kind was pledged.

Subhash Chander was incharge of the godown and keys were with Siri Ram Assistant Manager. Keys are issued after making an entry in key book and register. Keys are given to Godown Keeper after making entry in the key book. Keys are given to the Godown Keeper only when the goods are given to the parties. Godown keeper takes key and Assistant Manager signs the same. I have not brought the key movement register. Key given to the Godown Keeper when any operations is being done by the bank in the godown. Keys are only given when any operation is made in the Godown. On 28-6-73, Godown Keeper had taken the key with the signatures of Assistant Manager for operation of the Godown. Keys are handed over to the Godown Keeper after verification of the account."

Similarly Subhash Chander Gautam PW6 also states :-

Gopal Krishan Aggarwal Cashier stated that I should take the keys and deliver the goods to the accused and get their goods deposited. I and Ramesh Kumar went to the Godown together from the Bank. Accused pledged the goods vide document Ex., PW5/H and PW 5/I. I do not remember the time when the goods were delivered to the accused. That is mentioned in the keys register. Key is issued only when the Bank is satisfied that the go