Mens rea is essential for criminal breach of trust and cheating; mere retention of property by an employee without dishonest intent does not suffice for prosecution.

ORAL ORDER

The petitioner – accused No.2 is before this Court calling in question proceedings in C.C.No.19362/2017, pending before the III Additional Chief Metropolitan Magistrate, Bengaluru, for the offences under Section 408 , 420 and 120B r/w. 34 of the IPC. The proceedings against accused No.1 stood abated as she is no more.

2. Heard Sri R.G.Bhat, learned counsel for petitioner, Sri B.N.Jagadeesha, learned Additional State Public Prosecutor for respondent No.1 and Sri Saravana P., learned counsel for respondent No.2.

3. Learned counsel for petitioner submits that the issue in the lis is identical to what is considered by this Court in Crl.P.No.195/2020, disposed on 31.01.2023. This Court has held as follows:

“…. …. ……

11. The crime that is registered against the petitioner in Crime No.499 of 2015 is for offences punishable under Sections 406 and 409 of the IPC. The concerned Court took cognizance of the offence punishable under Sections 409 and 420 of the IPC against the petitioner and drops the offence punishable under Section 406 of the IPC. Section 420 of the IPC has its ingredients in Section 415 of the IPC. The ingredients are that an accused should lure the complainant/firm to part with certain property with dishonest intention. The case at hand is concerning contribution towards provident fund and its non-remittance to the Organization. It cannot be imagined as to how contribution of provident fund can be lured by the petitioner over the employees when it is a statutory deduction. Therefore, the cognizance for offence punishable under Section 420 of the IPC is recklessly taken, as none of the ingredients that are necessary to be proved for offence punishable under Section 420 as obtaining under Section 415 of the IPC are remotely present in the case at hand. Therefore, the cognizance being taken for the said offence is fundamentally flawed.

12. What remains is cognizance being taken under Section 409 of the IPC. Section 409 directs breach of trust by a servant or a banker or whoever being entrusted with some property. Even if it is construed of entrustment of property qua the deposit of provident fund against the petitioner, the finding rendered by the Special Court qua the Establishment and the discharge of the petitioner in those cases would clearly have a bearing on the offence so alleged under Section 409 of the IPC.If ingredients of Section 409 of the IPC are alleged element of mens rea would become mandatory. The finding of the Special Court in favour of the Establishment was that there was no willful default on the part of the Establishment and it was a circumstance which was beyond the control of the Establishment, as the Income Tax Department authorities had attached the properties of the Establishment. If that be the finding and the said finding having become final, the petitioner cannot be hauled into the web of crime for an offence under Section 409 of the IPC, as if there is willful default against the Establishment. There cannot be anything willful laid against the petitioner. There is no iota of element of mens rea that is alleged against the petitioner. 13. Reference being made to the judgment of the Apex Court in the case of N.RAGHAVENDER v. STATE OF ANDHRA PRADESH, CBI , [12021 SCC OnLine SC 1232] would be apposite. The Apex Court has held as follows:

“41. Section 409 IPC pertains to criminal breach of trust by a public servant or a banker, in respect of the property entrusted to him. The onus is on the prosecution to prove that the accused, a public servant or a banker was entrusted with the property which he is duly bound to account for and that he has committed criminal breach of trust. (See: Sadupati Nageswara Rao v. State of Andhra Pradesh).

42. The entrustment of public property and dishonest misappropriation or use thereof in the manner illustrated under Section 405 are a sine qua non for making an of