A partner can be guilty of an offence u/Sec. 406 IPC in respect of the monies of the firm only if he acquires dominion over the property not under the law of partnership by virtue of his position as partner but by reason of a special agreement between the parties.

P.N. Harkauli

1. BY these applications for revision the applicants have prayed that the charge framed against them by the learned Magistrate under Sec. 406/34 IPC may be quashed.

2. THE circumstances giving rise to these revisions are briefly as follows.

Prabhu Dayal, applicant no. 1, and Purshottam Das, father of the opposite party entered into a partnership for carrying on business of manufacturing straw board. The terms of the partnership were recorded in a written agreement, which is on record. Paragraph 16 of this agreement needs to be noticed here. It was provided in this paragraph of the partnership agreement that the cash, stock and the account books of the partnership shall remain in possession of Purshottam Das but the dues of the firm will be realized from third persons by Prabhu Dayal, applicant, whose duty it shall be to get the realizations entered in the account books and to deposit the same with Purshottam Das without delay. It was further provided in this paragraph that if perchance any amount realised by Prabhu Dayal was not got entered in the account books and was not deposited with Purshottam Das as provided earlier, Prabhu Dayal shall be liable to deposit such amount with interest from the date of realisation till the date of deposit.

3. SATISH Chandra Khandelwal, opposite-party, who is the son of Purshottam Das, filed two complaints against Prabhu Dayal and his son Munni Lal Jain applicants alleging that they had made realizations of various dues of the firm from third persons and they had misappropriated the same and thus they had committed offence u/Sec. 406 read with Sec. 34 IPC. The learned Magistrate, after recording the statements of some witnesses, framed a charge under Section 406/34 IPC against both the applicants.

4. FEELING aggrieved by this framing of charge the applicants preferred two revisions before the Sessions Judge. The learned Additional Sessions Judge, however, dismissed those applications for revision. Thereupon, these two applications for revision were filed in this Court.

The learned counsel for the applicants contended that there could be no question of an offence under Section 406 IPC being committed by either of the applicants. He argued that a partner of a firm being a co owner of all the assets of a firm is entitled to possess the same, and so a partner cannot be guilty of an offence u/Sec. 406 IPC in respect of the monies of the firm. In support of his tion he placed reliance upon a ruling of the Supreme Court reported in Velji Raghavji Pat el v. The State of Maharashtra, AIR 1975 SC 1433.

5. I am unable to agree with this contention of the learned counsel'for the applicants. In this ruling it has been observed as follows : ''Upon the plain reading of Sec. 405, IPC it is obvious that before a person can be said to have committed criminal breach of trust it must be established that he was either entrusted with or entrusted with dominion over property which he is said to have converted to his own use or disposed of in violation of any direction of law, etc. Every partner has dominion over property by reason of the fact that he is a partner. This is a kind of dominion which every owner of property has over his property. But it is not dominion of this kind which satisfies the requirements of Sec. 405. In order to establish "entrustment of dominion" over property to an accused person the mere existence of that person's dominion over property is not enough. It must be further shown that his dominion was the result of entrustment Therefore, rightly pointed out by Harris, C. J., the prosecution must establish that dominion over the assets or a particular asset of the partnership was, by a special agreement between the parties, entrusted to the accused persons. If in the absence of such a special agreement a partner receives money belonging to the partnership he cannot be said to have received it in a fiduciary capacity or in other words cannot be held to have been "entrusted"