Shri Gobind Prasad Lath vs Shri Paul Oswal

S.S. Sandhawalia, J.—On the 16th April, 1973, Shri Paul Oswal, Joint Managing Director, M/s. Vardhman Spinning and General Mills Ltd., Samrala Road, Ludhiana, instituted a complaint against Shri Govind Prasad Lath Petitioner in the Court of the Chief Judicial Magistrate, Ludhiana, levelling charges under Sections 409, 467, 468, 417 and 477-A of the Indian Penal Code. The broad allegations levelled in the complaint were that M/s. Vardhman Spinning and General Mills Ltd., Ludhiana, had appointed M/s. J. R. Trading Company of Calcutta as their sole-selling agents for the sale of their products in West Bengal territory by an agreement last renewed on the 26th July, 1971. Besides this, the sole proprietor of the above-said concern Shri Janak Raj Punni also held a general power of attorney dated the 7th January, 1967, on behalf of the Company above said to look after their, business affairs at Calcutta. Shri Janak Raj Punni, in his turn, appointed Shri Gobind Prasad Lath as the distributor for the sale of the yarn manufactured by the Company in West Bengal on a commission basis of 1/2 per cent on all the sales affected in or outside the above-said territory. An agreement to this effect was entered into on the 14th June, 1966, and it was the complainant''s case that relationship of principal and agent between Shri Janak Raj Punni and Gobind Prasad Lath Petitioner was created thereby. It was further the case that the Calcutta office of the Vardhman Spinning and General Mills Ltd. was manned by an Accountant named Shri Parkash Chander Sharma and Dharam Deo, a peon, who were supervised and controlled by Janak Raj Punni abovesaid.

The business practice was that the distributor Shri Govind Prasad Lath and Shri Janak Raj Punni deposited the entire collection and sale proceeds in terms of the agreements within 24 hours of the realisation thereof with the company''s bankers M/s. Allahabad Bank, Calcutta, who transmitted the same to the head office of the complainant Company. A regular account of the transaction was duly maintained by Shri Parkash Chander Sharma, Accountant, abovesaid.

It was further the complainant''s case that due to long-standing business deals, Shri Janak Raj Punni had come to repose the greatest confidence in Gobind Prasad Lath Petitioner. For the period between 8th March, 1973 and the 3rd April, 1973, Shri Janak Raj Punni was laid up with ill health and to meet the emergent official correspondence he entrusted Gobind Prasad Lath Petitioner with a few blank letter-heads of the Company duly signed by him. It was alleged that abusing the confidence reposed in him, the Petitioner got made false entries in the account books of the Company and forged documents purporting to be a letter of authority to withdraw huge sums of money from the Company out of the sale proceeds realised by him. By these methods, on the 29th March, 1973, a sum of Rs, 5,22,000 came into the hands of the Petitioner and contrary to the usual practice of depositing the above-said sale proceeds in the Bank, the Petitioner embezzled and misappropriated in all a sum of Rs. 5,17,000 therefrom. The details of the mode and manner of the embezzlement of different sums are given in paragraphs 4(a) to 4(j) of the complaint and detailed reference thereto is unnecessary for the purpose of this case at this stage. It was further alleged that on the 5th April, 1973, Shri Janak Raj Punni came to know of the withdrawal of the huge sums of money by the accused. Shri Parkash Chander Sharma informed him that on the 3rd April, 1973, he had been persuaded to carry the account books of the Company, to the place of the Petitioner where false entries were made in the account books purporting to be predated on the 29th March, 1973. Shri Janak Raj Punni was disagreeably suprised to notice this alleged treachery of the Petitioner and he along with Shri Darshan Kumar Oswal, Managing Director of the Company, who went to Calcutta, attempted to contact the Petitioner but he evaded all such moves and could not be traced. It is further the case that to add insult to injury, the Petitioner made a false report to the Bureau of Investigation, Finance Department, (Sales Department) West Bengal, Calcutta, and got some of the books of the Company removed from the office of the Company and some books from his own office.

Shri Janak Raj Punni and Darshan Kumar Oswal, Managing Director of the Company, reported the matter to the Company''s Head Office and also collected all possible information from the parties concerned. But, despite their efforts to contact the accused, they failed to do so because he had absconded. The Managing Director above-said of the Company attempted to examine the books seized by the Bureau of Investigation, Finance Department, but could not succeed.

On the point of jurisdiction, it was stated that since all the remittances of money had to be made by the accused-Petitioner to the Company at its head office at Ludhiana and the accounts ''had to be rendered at Ludhiana, therefore, the Chief Judicial Magistrate, Ludhiana, had jurisdiction to take cognizance of the complaint.

The Chief Judicial Magistrate, Ludhiana, examned P.W. 1 Shri Paul Oswal complainant and P. W. 2, Shri Janak Raj Punni as preliminary evidence in support of the complaint. The copy of an agreement dated the 26th July, 1971 between Vardhman Spinning and General Mills Ltd., Ludhiana, and Shri Janak Raj Punni, and another similar copy of an agreement dated the 14th June, 1966, between Shri Janak Raj Punni and Gobind Prasad Lath were also placed on record on behalf of the complainant apart from three more documents marked ''C, ''D'' and ''E'' on the record. On the basis of the abovesaid evidence, the Chief Judicial Magistrate held that an offence under Sections 409, 467, 468 and 477-A, Indian Penal Code, was made out against the accused and issued non-bailable warrants against him for the 28th April, 1973.

In compliance with the above-said order, the warrants were forwarded to Calcutta and the accused-Petitioner was taken into custody by the police there and produced before the Additional Chief Presidency Magistrate, Calcutta. He was directed to be released on furnishing a bail of Rs. 10,000 with two sureties of Rs. 5,000 each and further directed that he should appear before the Chief Judicial Magistrate, Ludhiana, by 15th May, 1973, and report compliance of this fact to the Additional Chief Presidency Magistrate, Calcutta, on the 21st May, 1973. Aggrieved by the grant of bail to the accused-Petitioner, the complainant Shri Paul Oswal moved an application in the High Court at Calcutta praying for the cancellation of the bail granted to him by the Additional Chief Presdency Magistrate, Calcutta. On the 14th June, 1973, the learned Judges of the Division Bench of the Calcutta High Court declined to interfere with the order of the Additional Chief Presidency Magistrate, Calcutta, but directed that the accused-Petitioner must appear before the Ludhiana Court on the 16th July, 1973; in default whereof, his bail would be cancelled.

It deserves notice, however, that prior to the abovesaid order of the Calcutta High Court, the Petitioner, on the 11th June, 1973, had moved the present petition in this Court u/s 561-A of the Code of Criminal Procedure seeking the quashing of the Criminal Proceedings launched against him in the Court of Chief Judicial Magistrate, Ludhiana. This petition came up before Hon''ble Mr. Justice Koshal during the vacation, on the 13th June, 1973, and was admitted to a hearing for the 4th July, 1973. Apparently, on that date it came up before Hon''ble Mr. Justice R.S. Sarkaria, and arguments at some length were addressed. Vide order dated 5th July, 1973, Sarkaria, J. directed the stay of further proceedings in the Court of the Magistrate at Ludhiana and the bail already granted to the Petitioner up to the 16th July, 1973, was also extended till further orders. However, his Lordship noticed that important questions of law regarding which there was a considerable conflict of Judicial opinion among the High Courts touching upon the interpretation, scope and application of Sections 177, 179, 181(2), 182 and 561-A, Criminal Procedure Code, had arisen in this case and he, consequently, referred the matter for determination by a larger-Bench. In pursuance of that reference, the matter is now before us.

Mr. M. C. Chagla, the learned Counsel for the Respondent, has raised two contentions by way of preliminary objections to the very competence of this petition u/s 561-A, Code of Criminal Procedure. He first argues that Shri Govind Prasad Lath Petitioner has disentitled himself to any relief in this Court under its inherent jurisdiction because of the blatant suppression of material facts made by him in the petition itself and later, and further for having violated a clear undertaking given by him before the Division Bench in the Calcutta High Court that he would appear before the Ludhiana Court on the 16th July, 1973. It is pointed out that, in fact, the Petitioner at no stage has appeared before the Court of the Chief Judicial Magistrate at Ludhiana and further that the factum of the order of the Calcutta High Court was not brought to the notice of the learned Judges before whom this petition came up for hearing. It is, therefore, on these premises, reiterated that the Petitioner invoking the inherent powers of the Court must come with clean hands and the alleged conduct of the Petitioner, according to the learned Counsel, has disentitled him to any relief.

We, however, regret our inability to agree with Mr. Chagla that the Petitioner is guilty of any such conduct which may merit a summary denial of hearing to him. A reference to this petition filed in this Court on the 11th June, 1973, makes it manifest that in paragraphs 2 and 3 thereof, express mention was made to the facts that the Petitioner was got arrested by the Commissioner of Police, Calcutta, on the 24th April, 1973, and was produced in the Court of the Additional Chief Presidency Magistrate on the 25th April, 1973. It is further specified that the Petitioner was released on bail of Rs. 10,000 with two sureties of Rs. 5,000 each by the said Court. The material facts existing at the relevant time were thus duly incorporated in the petition itself. Not only that, a true copy of the complaint filed against the Petitioner was placed on the record as annexure ''A'' thereto. What then deserves to be highlighted is that on the day this petition was filed here, the Calcutta High Court had not pronounced judgment in the proceedings for the cancellation of bail moved on behalf of the Respondent there. It is the common case that after the grant of bail to the Petitioner by the Additional Chief Presidency Magistrate, the complainant-Respondent lost little time in moving the High Court at Calcutta to secure the cancellation thereof. Proceedings there were yet continuing and since no order had been recorded, no reference to the same was possible on the date when the present petition was moved in this Court. The Calcutta High Court pronounced judgment on the 14th June, 1973, (copy thereof has been placed on the record during the course of the arguments on behalf of the Respondent). Meanwhile, in this Court the petition had been admitted to a hearing on the 4th July, 1973, by Koshal, J., by his order dated the 13th June, 1973. The matter then came up before Sarkaria, J., on the said date and it is stated that arguments continued before his Lordship for nearly two days. On behalf of the Petitioner, it is reiterated that far from there being any suppression of the orders of the Calcutta High Court, these were, in fact, brought to the notice of the Court here and it was in this context that the bail already granted to the Petitioner was extended and further proceedings stayed in the Ludhiana Court. It is significant to know that no application or any affidavit has been placed on the record on behalf of the Respondent even to allege prima facie that during the course of arguments in this Court, the earlier order of the Calcutta High Court was not referred to. The material part of Sarkaria, J.''s order dated 5th July, 1973, is in the following terms:

In the meantime, further proceedings in the Court of Magistrate at Ludhiana shall remain stayed. The bail already granted to the Petitioner up to 16th July, 1973, is extended till further orders. The records of the case may also be sent for. Dasti on payment of copying charges.

From the above extract, it appears to be manifest that the identical reference to the date of 16th July, 1973, was related to the assurance given on behalf of the Petitioner before the Division Bench at Calcutta that he would appear at Ludhiana on the 16th July, 1973. Prior to that date, however, this Court extended bail and stayed further proceedings in the Court below; thus obviating any necessity for the Petitioner to appear at Ludhiana. As is manifest, the records were got summoned from the said Court. In the light of the aforesaid facts, we are unable to detect either any glaring suppression of facts on behalf of the Petitioner or any deviation or violation from the undertaking he had given before the Division Bench in the High Court at Calcutta.

Mr. Chagla had then contended that the primary ground of attack in the present petition is on the premises that the Chief Judicial Magistrate, Ludhiana, has no territorial jurisdiction to take cognizance of the offence. The counsel contends that the issue of territorial jurisdiction is a matter within the revisional powers of the High Court and the inherent powers u/s 561-A, Criminal Procedure Code, are not attracted to the situation or in any case this Court should decline to interfere in a matter which, if necessary, can be corrected by way of revision. It was contended that a revisional application was competent in this regard first to the Court of Session at Ludhiana and no ground has been made out for allowing the Petitioner to approach the High Court direct and that also not under the revisional jurisdiction but u/s 561-A of the Code of Criminal Procedure.

On behalf of the Petitioner the above said contention is outflanked by the submission that it is inapt to read this petition as merely one directed merely on the ground of lack of territorial jurisdiction. Mr. Sibal points out that the primary prayer in the very heading of the petition is for the quashing of the proceedings as such. Reference is then made to paragraphs 4 and 5 which aver that upon the allegations made in the petition, no basis for any charge under the relevant sections of the Indian Penal Code is made out and the very foundation of the liability, namely, the alleged agency between the accused-Petitioner and the said Company at any point of time is disputed. Further, it has been reiterated that no case of any entrustment by the complainant to the accused-Petitioner was made out, thus obviating the possibility of any criminal breach of trust. Particular reliance is placed on paragraph 9(a) of the petition which is in these terms:

that the present proceedings on the basis of the above complaint and cognizance of the case upon the said complaint is a gross abuse of the process of law, inasmuch as there is no relationship of principal and agent between the accused-Petitioner and the said company.

We find substantial merit in the submission made on behalf of the Petitioner in this context. It is manifest that the issue of territorial jurisdiction is one of the many-pronged attack levelled against the institution of criminal proceedings against him by the Company. The averments in the body of the petition patently point to the claim that the very premises and the foundation of criminal liability were lacking. It is more than reiterated therein that no direct fiduciary relationship, far from there being that of an agent and principal, existed betwixt the accused-Petitioner and the complainant-Company, and, consequently, the very foundation of the criminal charge was lacking. Similarly, entrustment which is the necessary ingredient of the breach of trust is alleged to be lacking and, as is evident from the very opening part of the petition, the prayer is for the quashing of proceedings as such. In invoking the inherent powers in the relevant part of the grounds, it is again reiterated that the whole institution of the criminal proceedings against him was a gross abuse of the process of law. That being so, it is evident that prima facie the relief which the Petitioner claims can be granted to him primarily under the inherent powers of the Court u/s 561-A of the Code of Criminal Procedure. Patently, for the total quashing of proceedings, the revisional jurisdiction is hardly the proper forum. Equally, it is so that for invoking the inherent powers of the Court, the Petitioner has necessarily to approach it direct and is not bound to come through the channel of any recommendation from the Court of Session.

In the light of the foregoing discussion, we take the view that both the preliminary objections are not entitled to succeed and are hereby rejected. Learned Counsel for the parties when directed to argue the issue on merits had jointly prayed for a long adjournment due to their professional pre-occupations. The office may list this matter early on the reopening of the Court after the summer vacation.

S.C. Mital J.

By our order dated 30th April, 1974, preliminary objections raised by Mr. M. C. Chagla, learned Counsel for the Respondent, were rejected. Thereafter, the parties took very long to agree upon the date suiting their counsel. Even when the case came up for hearing on 2nd December, 1974, Mr. D. Mukherji, Senior Advocate of Calcutta, contended that Mr. A. K. Sen, Advocate, engaged by the Petitioner was confined to bed under medical advice. On this ground, adjournment prayed for was granted to 3rd February, 1975.

M/s. Vardhman Spinning and General Mills Ltd., Ludhiana, hereinafter referred to as the Company, had entered into a contract with M/s. J. R. Trading Company of Calcutta owned by Shri Janak Raj Punni, appointing the latter the sole selling agent of the pro-ducts of the Company in West Bengal. Besides, as alleged in the complaint, Shri Janak Raj Punni held a general power of attorney to supervise the office of the Company in Calcutta, run by Parkash Chander Sharma, Accountant and Dharam Dev, Peon. By a separate agreement, Shri Janak Raj Punni appointed Shri Gobind Parshad Lath, accused as the distributor for the sale of the Company''s goods in West Bengal. Thus, relationship of principal and agent between Shri Janak Raj Punni and Shri Gobind Parshad Lath was created. Upon these facts, learned Counsel for the accused contended that there was no privity of contract between the accused and the Company. On the other hand, the point raised was that the accused as sub-agent was liable to render accounts to the Company, Section 192 of the Indian Contract Act relied on in this behalf reads:

Representation of principal by sub-agent properly appointed.

Where a sub-agent is properly appointed, the principal is, so far as regards third persons, represented by the sub-agent and is bound by and responsible for his acts, as if he were an agent originally appointed by the principal.

Agent''s responsibility for sub-agent.

The agent is responsible to the principal for the acts of sub-agent.

Sub-agent''s responsibility.

The sub-agent is responsible for his acts to the agent, but not to the principal, except in cases of fraud or wilful wrong.

Clause (2) of the section is obviously not applicable. It has not been shown how Clause (3) can be pressed into service. Clause (1) clearly deals with the proposition quite different from the case in hand, in that, it envisages transactions entered into by the sub-agent with third persons and the consequent liability thereof on the principal.

In the alternative, learned Counsel for the accused placed reliance on Section 194 of the said Act. Section 194 is in the following terms:

Where an agent, holding an express or implied authority to name another person to act for the principal in the business of the agency, has named another person accordingly, such person is not a sub-agent, but an agent of the principal for such part of the business of the agency as is entrusted to him.

Now Clause 7 of the agreement "A" dated 26th July, 1971, between the Company and its agent Shri Janak Raj Punni provides:

The Selling Agents shall at their own cost employ such clerks, salesman or assistants as may be necessary and the Company shall not be responsible for any amount due to them from the Agents contract of service.

This clause neither expressly nor impliedly conferred authority on Shri Janak Raj Punni to name the accused to act for the principal, i.e., the Company. It further deserves mention that Clause 7(iv) of the agreement above-said stipulated that Shri Janak Raj Punni would not assign to any person agreement or any interest therein or any of the rights, privileges or obligations thereof without the prior written consent of the Company. Our attention has not been drawn to any material on record to show that for naming the accused, prior written consent of the Company was obtained by Shri Janak Raj Punni. The other aspect of the matter is that in agreement "B" between Shri Janak Raj Punni and the accused, the former described himself as the principal and the latter as Distributor. Stipulation in Clause (2) therein is that the Principal proposed the Distributor to act as the Sole Distributor of the principal with effect from 15th day of April, 1966. True, Shri Janak Raj Punni in Clause (1) of agreement "B" averred that he was the Sole Selling Agent of the Company, but there is no mention of any consent, much less written, received by him from the Company to appoint the accused as the Distributor. Furthermore, in agreement "B" nothing was stipulated to connect the accused with the Company. In other words, this was an agreement between Shri Janak Raj Punni and the accused. For the foregoing reasons, reading of the two agreements marked "A" and "B" would show that no case is made out to attract the provisions of Section 194 of the Indian Contract Act.

Learned Counsel for the Company then argued that Shri Janak Raj Punni held a general power of attorney to supervise the working of the office of the Company in Calcutta, manned by Parkash Chander Sharma, Accountant and Dharam Dev, Peon. During the relevant period when Shri Janak Raj Punni fell ill, he deputed the accused to act on his behalf. In these circumstances, the accused committed the alleged offences. We do not think that even this aspect of the case makes Section 194 of the Indian Contract Act applicable to its facts, for the simple reason that Shri Janak Raj Punni has not been shown to hold an express or implied authority to name the accused to act for the Company in the business of the agency. In the result, the accused cannot be said to be under any obligation to render accounts to the Company.

Objection of the learned Counsel for the accused challenging the locus-standi of the Company to file the present complaint under Sections 409 etc. Indian Penal Code, has not impressed us. If the accused is guilty of committing the alleged offences, the Company which is said to have suffered loss cannot be debarred from launching the prosecution.

Learned Counsel for the accused again pressed that the question whether the Ludhiana Court has territorial jurisdiction to take cognizance of these offences could not be decided in the exercise of the powers of this Court u/s 561-A of the Code of Criminal Procedure. A Single Bench decision of this Court in Murari Lal v. Shiv Parkash (1971) Cri. L.J. 96 was referred to wherein the learned Judge expressed the view:

This is a matter which cannot be gone into in these proceedings. It is open to the Petitioner to raise this objection in the trial Court and then come to this Court on the revisional side if he fails to get relief in the trial Court and the Sessions Court. The contention whether the Court at Nawanshahar has jurisdiction cannot be properly determined in proceedings u/s 561-A of the Criminal Procedure Code.

We do not think that the learned Judge laid down a complete bar, as urged before us. These observations, as we understand them, were in the context of the facts of that case. It is noteworthy that D. Falshaw, J. (as he then WAS) in Dr. Shankar Singh Ganda Singh Vs. State of Punjab, categorised the cases in which Section 561-A could be invoked and one of the cases was where the Court lacked jurisdiction to take cognizance of an offence. Debabrata Gupta Vs. S.K. Ghosh, was a case where lack of territorial jurisdiction was taken as one of the grounds for interference u/s 561-A of the Code of Criminal Procedure, but on facts, the learned Judges declined to entertain the objection and the matter was left open for decision by the trial Court. It is significant that there is absolutely no indication in the Supreme Court decision to support the contention raised before us. It is accordingly overruled.

For deciding whether the Ludhiana Court has jurisdiction to take cognizance of the offences in question, it may be mentioned that the common case of the parties before us is that the provisions of the old Code of Criminal Procedure of 1898 apply, right up to the stage of the case in this Court. Section 177 of the Code enacts:

Every offence shall ordinarily be inquired into and tried by a Court within the local limits of whose jurisdiction it was committed.

This is a general provision based on the view of the English law that all crime is local and that jurisdiction to deal with it depends on the place where the crime is committed. Learned Counsel for the accused vehemently urged that as per allegations made in the complaint, the accused abused the confidence reposed in him by Shri Janak Raj Punni and with a view to defraud Shri Janak Raj Punni and the Company, he got false entries made in the cash books of the Company and forged the document, purporting to be letter of authority, to withdraw huge sums of money out of the sale proceeds realised by the accused. Generally, the sale proceeds were realised through cheques but with criminal intentions, the accused recovered the sum of Rs. 5,22,000/- odd in cash. The offences under Sections 467, 468 and 477-A, Indian Penal Code, on the Company''s own showing, were committed in Calcutta. On the other hand, the argument advanced was that commission of these offences culminated in the commission of criminal breach of trust, the major charge u/s 409, Indian Penal Code, against him. Thus, the arguments before us centered round the venue of trial as to the charge u/s 409, Indian Penal Code.

Section 181(2) of the Code directly dealing with the criminal breach of trust reads:

The offence of criminal misappropriation or of criminal breach of trust may be inquired into or tried by a Court within the local limits of whose jurisdiction any part of the property which is the subject matter of the offence was received or retained by the accused person, or the offence was committed.

Jurisdiction to Ludhiana Court is not being claimed by reason of the accused having received or retained any property, which could be the subject of offence. The only remaining ingredient of the section thus is the place where the offence of criminal breach of trust was committed.

Section 405, Indian Penal Code, defines criminal breach of trust as under:

Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits ''criminal breach of trust.

It is well-settled that this section is in two parts. The instant case clearly falls in the first part as is evident from the following salient allegations. The accused allegedly realised the sale proceeds in Calcutta or within the territory of West Bengal. It was there that he committed the offences under Sections 467, 468, 477-A, Indian Penal Code. It was in Calcutta that the accused failed to deposit the sale proceeds to the tune of Rs. 5,17,000/- odd in the Company''s account with the Allahabad Bank Ltd., Bara Bazar, Calcutta and in this way, he dishonestly misappropriated or converted the said amount to his own use; hence the commission of the offence of criminal breach of trust by him was complete in Calcutta. It is no gain saying that at this stage the Court has to confine itself to the allegations made in the complaint, supported by oral and documentary evidence. Keeping them in mind, there is no escape from the conclusion that Section 181(2) quoted above cannot confer jurisdiction upon the Ludhiana Court. When confronted with this difficulty, learned Counsel for the Company pressed into service Sub-section (4) of Section 181 of the new Code of Criminal Procedure of 1973. The same is in the following terms:

Any offence of criminal misappropriation or of criminal breach of trust may be inquired into or tried by a Court within whose local jurisdiction the offence was committed or any part of the property which is the subject matter of the offence was received or retained, or was required to be returned or accounted for, by the accused-person.

Strong reliance was placed on State of Bihar Vs. S.K. Roy, in which their Lordships laid down:

It is a well-recognised principle in dealing with matters of construction that subsequent legislation may be looked at in order to see what is the proper interpretation to be put upon the earlier Act where the earlier Act is obscure or ambiguous or readily capable of more than one interpretation.

In the first place, having regard to the facts of the case in hand, we do not find any ambiguity in the provisions of Section 181(2) of the old Code of Criminal Procedure, for the simple reason that the accused was not liable to render any accounts to the Company anywhere, much less at Ludhiana. In the second place, as said above, this case is not governed by the provisions of the new Code. In the third place upon a consideration of the allegations made in the complaint, the commission of the offence of criminal breach of trust was complete in Calcutta.

We are in respectful agreement with the view of Beaumount, C.J., who delivered the Full Bench judgment in re Jivandas Savchand AIR (1930) Bom. 490, that "when you find a section dealing with a particular form of crime I think it would require strong words to show that any section of more general application was intended to deal also with that particular crime". It is noteworthy that the view was expressed by the learned Chief Justice in the context of the applicability of the provisions of Section 181(2) and Section 179 of the Code of Criminal Procedure to a case of criminal breach of trust. Now the argument of the learned Counsel for the Company to be considered is that since in consequence of the criminal breach of trust committed by the accused, loss to the Company occurred in Ludhiana, therefore, the Ludhiana Court has jurisdiction. Section 179 of the Code pressed into service by the learned Counsel for the company reads:

When a person is accused of the commission of any offence by reason of anything which has been done, and of any consequence which has ensued, such offence may be inquired into or tried by a Court within the local limits of whose jurisdiction any such thing has been done or any such consequence has ensued.

Illustration (a) of the section is:

A is wounded within the local limits of the jurisdiction of Court X, and dies within the local limits of the jurisdiction of Court Z. The offence of the culpable homicide of A may be inquired into or tried by X or Z.

In the illustration, the offence charged is culpable homicide. The mere act of wounding A is not by itself enough to constitute the said charge. It may no doubt be a ground for another charge but that is immaterial. To constitute the charge of culpable homicide, the consequence of death is essential. Thus reading the section with the help of illustration, we respectfully follow the Full Bench decision of the Bombay High Court (supra) that the consequence envisaged by Section 179 is a necessary ingredient or an integral part of the offence.

Same view was expressed by Full Bench decision of the Allahabad High Court in Kanshi Ram Mehta v. Emperor AIR 1934 All 499 thus:

If, therefore, the act done and the consequence which has ensued are to be taken as together amounting to the offence, the commission of which is complained against then it necessarily follows that the consequence must be the necessary ingredient of the offence in order that Section 179 be applicable. If the offence is complete In itself by reason of the act having been done and the consequence is a mere result of it, which was not essential for the completion of the offence, then S. 179 would not be applicable.

The other rulings in point are In Re: Ram Bilas AIR (1915) Mad. 600, Krishnamachari Vs. Shaw, Wallace and Company, , Simpachalam v. Rati Kanta Laha AIR 1917 Cal. 381 , Niwasilal Modi and Others Vs. Routhmull, , Banerji v. Potnis AIR (1924) Nag. 253 , AIR 1933 559 (Lahore) , Ali Mohamed Kassim v. Emperor AIR 1931 Rang. 164, and Gowakaran Lal v. Sarjoo Saw AIR 1921 Pat 85. It is clear from them that unless any act or even omission is a necessary ingredient of an offence of criminal breach of trust, it cannot give jurisdiction to a court where that act or omission has been done, though it may by the necessary result or consequence arising therefrom.

V.D. Bhargave, J., also discussed at length the ruling referred to above in Hira Lal Chaudhary and Others Vs. State, and followed the Full Bench decisions of the Bombay and Allahabad High Courts. The following (observations in paragraphs 32 and 34 of the report of the learned Judge deserve particular mention:

Non-accounting is no part of the criminal breach of trust. It is really the result or consequence resulting from the criminal misappropriation. Its effect might either be loss to the firm or may result in non-accounting but that would not make it an ingredient of the offence itself.

Where the place of offence is known or can be ascertained, the courts of the place where accounts were to be rendered will have no jurisdiction to try the case.

The Full Bench decision of the Bombay High Court (supra) was followed in Bijoyanand Patnaik Vs. Mrs. K.A.A. Brinnand, and the learned Judge held that in a case of complaint u/s 406 where neither entrustment nor conversion has taken place within the territorial jurisdiction of the Court where complaint is lodged, the Court has no jurisdiction to proceed with the complaint. Similarly, a Division Bench of the Calcutta High Court in Debendra Nath Sen Vs. Rajendra Chandra Roy, , held that in a case of criminal breach of trust failure to account is often convincing of the act of misappropriation but not an incident of the said act. Non-submission of an account being not an integral part of an act of misappropriation it cannot be said that the offence took place not only at the place where the misappropriation took place, but also at the place where the accounts were not rendered.

AIR 1926 119 (Lahore) and Gunananda Dhone Vs. Lala Santi Prakash Nandy, , cited by the learned Counsel for the Company were cases wherein the accused were under a liability to render accounts at a particular place but failed to do so by reason of having committed an offence of criminal breach of trust. The view expressed by the learned Judges was that the Court within whose territorial jurisdiction the aforesaid place was situated, had the jurisdiction u/s 181(2) of the Code, to try the offence of criminal breach of trust. Having regard to my finding that the accused was under no obligation to render accounts to the Company, these rulings are distinguishable. Besides, now the amendment made by Section 181(4) of the new Code enacts that the Courts within whose local jurisdiction the property, which is the subject-matter of the offence of criminal breach of trust, was required to be accounted for, will have jurisdiction to try. That being so, the question, whether a correct law was laid down in them, need not be gone into. For the foregoing reasons, S. Arunachala Goundan Vs. K.S. Akhileshwara Ayyar, , and Mohru Lal Vs. Emperor, , are no longer in point.

In the result, we are of the considered view that the Ludhiana Court has no jurisdiction to take cognizance of the offences mentioned in the complaint. The petition is accordingly accepted and we direct that as required by Section 201(1) of the old Code, the complaint be returned to the complainant for presentation to the proper Court, with an endorsement to that effect.

S.S. Sandhawalia, J.

I agree.