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1952 Supreme(SC) 71

SUPREME COURT OF INDIA
10th November 1952
PATANJALI SASTRI, C.J.I., B.K. MUKHERJEA, S.R. DAS, BOSE AND GULAM HASAN, JJ.
Chelloor Manknkal Narayan, Ittirvi Nambudiri, Appellant
Versus
State of Travancore-Cochin.
Criminal Appeal No. 31 of 1952.
Advocates appeared
Shri M. K. Nambiar, Senior Advocate (Shri Ramasheshayya Chaudhury and Shri M. B. Kurup, Advocates, with him) instructed by Shri S. Subramanian, Agent, for Appellant; Shri T. N. Subramania Iyer, Advocate-General of Travancore Cochin (Shri M. K. Krishna Pillai, Advocate, with him), instructed by Shri P. A. Mehta, Agent for the State.

Advocates:
M.B.Kurup, M.K.Krishna Pillai, M.K.NAMBIYAR, P.A.Mehta, Ramasheshayya Chaudhury, S.SIVA SUBRAMANIAM, T.N.SUBRAMANIA IYER

Headnote:Section 405-Scope and applicability.

       Held: "The other point that requires consideration is, whether on the prosecution evidence as it stands the accused can be held guilty of criminal breach of trust? As laid down in S. 385, Cochin Penal Code, (corresponding to S. 405, Indian Penal Code) to constitute an offence of criminal breach of trust, it is essential that the prosecution must prove first of all that the accused was entrusted with some property or with any dominion or power over it. It has to be established further that in respect of the property so entrusted, there was dishonest misappropriation or dishonest conversion or dishonest use or disposal in violation of a direction of law of legal contract, by the accused himself or by someone else which he willingly suffered to do.

       It follows almost axiomatically from this definition that the ownership or beneficial interest in the property in respect of which criminal breach of trust is alleged to have been committed, must be in some person other than the accused and the latter must hold it on account of some person or in some way for his benefit. In the case before us it is not disputed that if the sum of Rs. 23,100 was paid by P.W.I. to the appellant by way of illegal gratification to induce the latter to make an allotment of cloth in his favour, there could be no question of entrustment in such payment. The payee would then receive the money on his own behalf and not on behalf of or in trust for anybody else. The criminality of an act of this charaoter would consist in illegal receipt of the money and the question of subsequent misappropriation or conversion of the same would not arise at all. - Article 136-Interference by Supreme Court in Criminal appeals.

       Held: "It cannot be disputed that the High Court even though it was hearing an appeal from an order of acquittal, had full powers to review the entire evidence on the record and reach its own conclusion that the acquittal order should be set aside. But as the Privy Council pointed out in-Sheosarup v. Emperor, A.I.R. •1934 P.C. 227 in exercising these powers the High Court should and will always give proper weight and consideration to such matters as: (1) the views of the trial court as to the credibility of witnesses; (2) presumption of innocence in favour of the accused, a presumption certainly not weakened by the fact that he had been acquitted at the trial; (3) the right of the accused to the benefit of any doubt; and (4) the slowness of an appellate court in disturbing a finding of fact arrived at by a Judge who had the advantage of seeing the witnesses.

       "The High Court, in our opinion, did not clearly keep before it these rules and principles well-known and recognized in the administration of criminal justice. It reversed the decision of the trial court without noticing or giving due weight and consideration to important matters relied upon by that court and its decision has to a large extent been influenced by suspicious circumstances disclosed at the trial which are undoubtedly prejudicial to the accused, but in regard to which no opportunity of explanation was given to him when he was examined under the provisions of the Cochin Criminal Procedure Code which corresponds to S. 342 of the Indian Code. According to the principles which are recognized and acted upon by this court in dealing with criminal appeals coming before it on special leave these would be considered adequate grounds justifying our interference with the decision of the High Court. - Section 423-Appeal from acquittal.

       Held: "It cannot be disputed that the High Court, even though it was hearing an appeal from an order of acquittal, had full powers to review the entire evidence on the record and reach its own conclusion that the acquittal order should be set aside. But as the Privy Council pointed out in " Sheoswarup v. Emperor" A.I.R. 1934 P.C. 227, in exercising these powers the High Court should and will always give proper weight and consideration to such matters as: (1) the views of the trial court as to the credibility of witnesses: (2) presumption of innocence in favour of the accused, a presumption certainly not weakened by the fact that he had been acquitted at the trial: (3) the right of accused to the benefit of any doubt: and (4) the slowness of an appellate court in disturbing a finding of fact arrived at by a Judge who had the advantage of seeing the witnesses.

       The High Court, in our opinion, did not clearly keep before it these rules and principles well-known and recognised in the administration of criminal justice. It reversed the decision of the trial court without noticing or giving due weight and consideration to important matters relied upon by that Court and its decision has to a large extent been influenced by Suspicious circumstances disclosed at the trial which are undoubtedly prejudicial to the accused, but in regard to which no opportunity of explanation was given to him when he was examined under the provisions of the Cochin Criminal Procedure Code which corresponds to S. 342 of the Indian Code. According to the principles which are recognised and acted upon by this court in dealing with criminal appeals coming before it on special leave these would. be considered adequate grounds justifying our interference with the decision of the High Court.

Judgment

B. K. MUKHERJEA J.: This appeal, which has come before us on special leave, is directed against a Judgment of the High court of Travancore-Cochin dated July 16, 1951 passed in Criminal Appeal No.194 of 1950, by which the learned Judges set aside an order of acquittal made in favour of the appellant by the Special Magistrate, Trichur, in C.C.No.1 of l125 M.E. and converting it into one of conviction under S. 389, Cochin Penal Code (corresponding to S. 409, Indian Penal Code ) sentenced him to undergo rigorous imprisonment for a period of one year and pay a fine of Rs. 1,000; in default of payment of fine, he was to suffer rigorous imprisonment for a further term of four months.

2. It may be mentioned here that the appellant, who has been described as accused No. 1 in the judgments of both the courts below, was tried along with two other persons as his co-accused by the Special Magistrate of Trichur, who made an order of acquittal in favour of all of them. The State Government preferred an appeal to the High Court challenging the property of the entire order . The High Court dismissed the appeal so far as it related to accused Nos. 2 and 3 and reversed the judgment of the original court in regard to accused No. 1, who is the sole appellant before us.

3. The material facts necessary for purposes of the present appeal may be briefly narrated as follows. The appellant and accused No. 2 Ramachandra Iyer were appointed joint receivers of a textile business, known as Sitaram Spinning and Weaving Mills Limited (hereinafter referred to as the mills), situated at Trichur, under an order of the High Court of Cochin passed in O.S.No.2 of l123 M.E. The order of appointment was made on13-2-1948 and it conferred on the receivers all powers of management according to the Articles of Association of the Mil1s. They were to keep regular accounts and submit monthly statements of receipts and disbursements on the 10th day of every English calendar month. Shortly before the date that this order was passed, the control on textile goods that existed since 1943 was withdrawn by the Government. The control of prices however was continued till the end of April 1948 and after that, there was, strictly speaking, no fixed rates at which textile goods were to be sold compulsorily by the manufacturers.

But there was, was, what has been described as a gentleman s agreement, arrived at by the members of the South Indian Mill Owners Association, according to which different prices were fixed for different kinds of cloth and the old practice of stamping each piece of cloth with the date of its production and also the ex-mill and retail prices still continued. During the control period the distribution was effected through certain quota holders, each one of whom had a number of bales allotted to him as his quota. It appears that after the control was withdrawn, these quota-holders asserted a sort of legal right to continue as agents for distribution of the mill products so long as the mills remained under Court management.

The High Court, however, passed an order to the effect that the existing contracts had ceased to be in force and the receivers could ignore them altogether and enter into fresh arrangements with other persons which, in their opinion, would best serve the interests of the institution. P. W. 1 Vaidyanath Iyer, upon whose allegations the entire prosecution story rests, was one such quota holder. He was a share-holder of the company and was running, with other partners, a cloth business under the name and style of Swadeshi Piece-Goods Depot at Trichur. for his Trichur shop he was getting 40 bales of cloth as his quota per month and it is admitted that he got this quantity both for February and March, 1948. He did not get anything for April and the prosecution story is that he met the first accused and had a talk with him about this matter. It is alleged that the first accused told him:

"I shall give you 100 bales. You must give me Rs.10,000 ov












































































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