Mukhlal Rai vs Emperor

John Bucknill, J.—This was an application in criminal revisional jurisdiction made to this Court by one Mukhlal Rai. This man was convicted by an Honorary Magistrate of the First Class of Arrah On the 12th of April last of an offence punishable u/s 406 (criminal breach of trust) of the Indian Penal Code. He was sentenced to rigorous imprisonment for three months and to pay a fine of Rs. 250 and, in default of payment thereof, to a further term of three months'', rigorous imprisonment. The fine, if realised, was ordered to be paid to the complainant. From this conviction and sentence the applicant appealed to the Sessions Judge of Shahabad, who, however, dismissed the appeal on the 10th of May last. It is from this dismissal that the applicant has now come to this Court.

It is difficult, on reading the facts in this case as set out in the decisions of the trial and the lower Appellate Courts, to see how this conviction can be upheld. The facts appear to be extremely simple and to disclose a civil dispute. The complainant is one Naulakh Lal and he is a grain dealer. The applicant is also a grain dealer. The two men met accidentally at a Gola, in Arrah where they were both about their own business and, in the course of conversation, the applicant informed the complainant that he had in stock a large quantity of grain which he was ready to sell. The applicant showed the complainant some samples and they agreed that they would enter into trade relationship; the grain which the applicant had for disposal consisted of wheat and gram and it was agreed, on the samples, that the rate of the same should be Rs. 1 for 8 seers of wheat and Rs. 1 for 11� seers of gram. Before concluding the contract, the complainant wished to examine the grain in bulk to ascertain if its quality was equal to the samples which had been shown by the applicant to him; this was done on the following day with satisfactory results and it was then agreed that the complainant should purchase 250 maunds of the grain. The applicant then told the complainant that he wanted a small sum of money by way of advance; the complainant eventually handed over the sum of Rs. 201 to the applicant. It does not seem to me to matter whether this sum was handed over as part purchase of the grain or by way of simple loan. If it was earnest-money to strike the bargain, it, no doubt, would have been set off as part purchase of the grain; if it was a mere loan, it might or might not be re-paid in cash or grain. There is nothing to show that it was handed over by way of an entrustment or in any other manner than either as part of the contract or by way of mere borrowing.

The subsequent course of events was unfortunate. On the following day, when the complainant went over with his sacks to take the grain which he had agreed to purchase, two nephews of the applicant who were, it is said, members of a joint family with the applicant and had some interest in the grain which was to be sold, made difficulties about the rates which had, been agreed between their uncle and the complainant. It seems that since the agreement the value of wheat and gram, had somewhat appreciated; the price on the day when the complainant wanted to take delivery appears to have been Rs. 1 for 7� seers of wheat and Rs. 1 for 10� seers of gram as against 8 and 11� seers respectively which had been agreed upon as the contract price, of the grains. Anyhow the upshot was that there was some sort of quarrel, the complainant did not get his grain and the money was not paid back to him. The complainant shortly afterwards charged the applicant with a criminal offence with the result that proceedings were instituted and the applicant was convicted in the manner I have already indicated.

I am really somewhat at a loss to understand how what has taken place could well form a subject-matter of criminal proceedings. There was a contract between the two parties and it may well have been that there was a breach of that contract, On whose side the liability for damages for the breach lay, it is not for me to suggest; it may very well be that the complainant might have a perfectly good ground for bringing an action against the applicant for damages for having broken his contract and for the return of the money whether it was advanced by way of part purchase price or loan. There seems to have been no evidence which, in law, can properly be regarded as showing an entrustment in any fiduciary form of the money paid by the complainant to the applicant nor, so far as lean see, can it be suggested that, legally, there was any evidence of dishonest appropriation. The matter, to my mind, is one of civil dispute capable of settlement not in the Criminal but in the Civil Courts. It should perhaps be observed that the applicant set up the defence that the whole story put forward by the complainant was false; this defence has been found to be unfounded. But the mere fact that it was put forward by the applicant when he was charged with a criminal offence, does not in itself prove that he was guilty of the offence of which he was actually convicted, i.e., criminal breach of trust.

Under these circumstances, it seems to me that it is clear that the conviction cannot stand. The order of the Honorary Magistrate of the First Class of Arrah, dated the 12th of April, 1926, and the decision of the Sessions Judge of Shahabad, datad the 10th of May last, must be set aside and the conviction and sentence quashed. The fine, if paid, must be refunded.