Page 1

NON-REPORTABLE IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.2085 OF 2013 (Arising out of SLP(Crl.) No. 8101 of 2009)

Ghanshyam                   .... Appellant Vs.  

State of Rajasthan .... Respondent

J U D G M E N T

    V.Gopala Gowda J.

Leave granted.

2. This appeal is filed by the appellant/accused  

questioning the correctness of the judgment and

Page 2

Crl.A.@SLP(Crl.) No. 8101 of 2009

final Order dated 04.02.2009 passed by the High  

Court of Judicature at Rajasthan, Jaipur in S.B.  

Criminal Misc. Petition No. 1067 of 2005 remanding  

the  matter  back  to  the  trial  court  for  fresh  

decision in the light of the statements of the  

witnesses  and  also  the  material  and  evidence  

available  on  record,  urging  various  facts  and  

legal contentions in justification of his claim.

 3. Necessary relevant facts are stated hereunder  

to appreciate the case of the appellant/accused  

and also to find out whether he is entitled for  

the relief as prayed in this appeal.

At the time of filing of this appeal, there  

were two respondents, respondent no.1 Ram Dayal –  

the complainant and respondent no.2 – the State of  

Rajasthan. Name of the complainant-Respondent no.1  

has been deleted vide this Court’s order dated 13th  

2

Page 3

Crl.A.@SLP(Crl.) No. 8101 of 2009

September, 2010 as the appellant could not take  

steps of service upon him.

 The complainant alleged that on 1.10.1994, he  

gave three gold chains weighing 6.5 tola to the  

accused-appellant for making a new design chain  

after melting the old chains. But according to the  

complainant, neither the three old chains nor a  

new gold chain were returned to him. On 2.11.1994,  

the complainant sent a telegram asking the accused  

appellant to return the gold chains. He further  

sent a legal notice through his advocate to the  

appellant on 6.5.1995 making allegation of taking  

the gold chains and not returning the same. All  

the allegations were denied by the appellant. The  

complainant then filed a complaint under Section  

156(3) of the Criminal Procedure Code (in short  

‘CrPC’) for an offence under Section 406 of the  

Indian Penal Code. Statements of witnesses were  

3

Page 4

Crl.A.@SLP(Crl.) No. 8101 of 2009

taken under Section 161, CrPC by the Additional  

Chief  Judicial  Magistrate,  Gangapur  City.  The  

complainant  further  filed  an  application  under  

Section  190  of  CrPC  before  the  Additional  

Metropolitan Magistrate bringing to his notice the  

commission of the alleged offence. Investigation  

was  conducted  by  the  SHO,  PS  Gangapur  City,  

District Sawai Madhopur and report was submitted  

by him who concluded that the FIR was false and  

the case was without merit. The complainant filed  

a protest petition against the said report. The  

Additional  Chief  Judicial  Magistrate,  while  

considering  the  protest  petition,  confirmed  the  

negative  report.  The  complainant  challenged  the  

said  Order  of  the  Additional  Chief  Judicial  

Magistrate before the Additional Sessions Judge by  

filing a protest petition. The Court of Additional  

Sessions  Judge  set  aside  the  Order  of  the  

Additional Chief Judicial Magistrate and sent the  

4

Page 5

Crl.A.@SLP(Crl.) No. 8101 of 2009

matter  back  to  the  Additional  Metropolitan  

Magistrate to rehear the matter after considering  

the  documents  on  record.  The  Additional  

Metropolitan  Magistrate  considered  the  entire  

evidence on record and came to the conclusion that  

no  case  was  made  out  and  the  protest  petition  

filed by the complainant deserved to be dismissed.  

4. The complainant being aggrieved by the Order  

of  the  Additional  Metropolitan  Magistrate  

preferred a criminal revision before the Court of  

learned Additional Sessions Judge which upheld the  

Order  passed  by  the  Additional  Metropolitan  

Magistrate. The complainant, therefore, preferred  

a petition under Section 482 of CrPC challenging  

the  Order  of  the  learned  Additional  Sessions  

Judge.  The  Hon’ble  High  Court  exercised  its  

inherent jurisdiction to set aside the findings of  

5

Page 6

Crl.A.@SLP(Crl.) No. 8101 of 2009

the courts below and allowed the petition of the  

complainant.

5. The  High  Court,  vide  its  judgment  dated  

4.2.2009, held that the statement recorded by the  

ACJM clearly reveals that the complainant handed  

over three gold chains to the accused-appellant at  

the time of purchase of cloth  by the appellant  

from the complainant’s shop but the same were not  

returned. Therefore, according to the High Court,  

a prima facie case of criminal breach of trust was  

clearly  made  against  the  accused-appellant.  The  

trial Court erred in observing that no entry could  

have been made by the complainant in his record  

book  simultaneously  when  the  clothes  were  

purchased  by  the  accused  appellant  from  the  

complainant’s shop. The High Court further held  

that  trial  court  erred  in  proceeding  on  any  

presumption when the evidence available on record  

6

Page 7

Crl.A.@SLP(Crl.) No. 8101 of 2009

proved otherwise and there was admission by the  

accused.  In  such  cases,  the  burden  was  on  the  

accused to have rebutted the allegation against  

him. Therefore, the High Court remanded the matter  

back to the trial court for fresh decision in the  

light  of  the  statements  of  the  witnesses  and  

evidence on record.

 6. In the light of the facts and circumstances  

presented before us on the basis of evidence on  

record, and also based on the contentions raised  

by the learned senior counsel on behalf of both  

the  parties,  we  are  inclined  to  frame  the  

following issue to be answered by us:

1.Whether the High Court was justified  

in remanding the matter back to trial  

court  for  consideration  on  merit  

against the concurrent findings of the  

courts below?

7

Page 8

Crl.A.@SLP(Crl.) No. 8101 of 2009

7. It is to be noted here that the case made  

against  the  accused  in  this  case  is  that  of  

criminal breach of trust. Criminal breach of trust  

is provided under Section 405 of Indian Penal Code  

which reads as:

“405.  Criminal  Breach  of  Trust:  Whoever, being in any manner entrusted  with  property,  or  with  any  dominion  over  property,  dishonestly  misappropriates or converts to his own  use 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  willfully  suffers  any  other  person  so  to  do,  commits  “Criminal  Breach of Trust”.

The  punishment  for  Criminal  breach  of  trust  is  

provided under Sections 406-409 of IPC.  

8. It has been held in the case of  Onkar Nath  Mishra and Ors. v. State (NCT of Delhi) and Anr.1  

that in the commission of the offence of criminal  1 (2008) 2 SCC 561

8

Page 9

Crl.A.@SLP(Crl.) No. 8101 of 2009

breach of trust, two distinct parts are involved.  

The  first  consists  of  the  creation  of  an  

obligation in relation to the property over which  

dominion or control is acquired by the accused.  

The second is a misappropriation or dealing with  

the property dishonestly and contrary to the terms  

of the obligation created.

9. Further,  it  has  been  held  in  the  case  of  

Jaikrishnadas Manohardas Desai and Anr. v. State  of Bombay2 that:  

“To  establish  a  charge  of criminal  breach of trust, the prosecution is not  obliged  to  prove  the  precise  mode  of  conversion,  misappropriation  or  misapplication  by  the  accused  of  the  property entrusted to him or over which  he  has  dominion.  The  principal  ingredient  of  the  offence  being  dishonest  misappropriation  or  conversion which may not ordinarily be  a matter of direct proof, entrustment  of  property  and  failure,  in breach of  an  obligation,  to  account  for  the  property entrusted, if proved, may in  the  light  of  other  circumstances,  

2 AIR 1960 SC 889

9

Page 10

Crl.A.@SLP(Crl.) No. 8101 of 2009

justifiably  lead  to  an  inference  of  dishonest  misappropriation  or  conversion. Conviction of a person for  the offence of criminal breach of trust  may  not,  in  all  cases,  be  founded  merely  on  his  failure  to  account  for  the property entrusted to him, or over  which he has dominion, even when a duty  to  account  is  imposed  upon  him  but  where he is unable to account which is  untrue,  an  inference  of  misappropriation with dishonest intent  may readily be made., the prosecution  is  not  obliged  to  prove  the  precise  mode of conversion, misappropriation or  misapplication  by  the  accused  of  the  property entrusted to him or over which  he  has  dominion.  The  principal  ingredient  of  the  offence  being  dishonest  misappropriation  or  conversion which may not ordinarily be  a  matter  of  direct proof,  entrustment  of  property  and  failure,  in breach of  an  obligation,  to  account  for  the  property entrusted, if proved, may in  the  light  of  other  circumstances,  justifiably  lead  to  an  inference  of  dishonest  misappropriation  or  conversion. Conviction of a person for  the offence of criminal breach of trust  may  not,  in  all  cases,  be  founded  merely  on  his  failure  to  account  for  the property entrusted to him, or over  which he has dominion, even when a duty  to  account  is  imposed  upon  him  but  where he is unable to account which is  untrue,  an  inference  of  

1

Page 11

Crl.A.@SLP(Crl.) No. 8101 of 2009

misappropriation with dishonest intent  may readily be made., the prosecution  is  not  obliged  to  prove  the  precise  mode of conversion, misappropriation or  misapplication  by  the  accused  of  the  property entrusted to him or over which  he  has  dominion.  The  principal  ingredient  of  the  offence  being  dishonest  misappropriation  or  conversion which may not ordinarily be  a  matter  of  direct proof,  entrustment  of property and failure, in breach of  an  obligation,  to  account  for  the  property entrusted, if proved, may in  the  light  of  other  circumstances,  justifiably  lead  to  an  inference  of  dishonest  misappropriation  or  conversion. Conviction of a person for  the offence of criminal breach of trust  may  not,  in  all  cases,  be  founded  merely  on  his  failure  to  account  for  the property entrusted to him, or over  which he has dominion, even when a duty  to  account  is  imposed  upon  him  but  where he is unable to account which is  untrue,  an  inference  of  misappropriation with dishonest intent  may readily be made.”

   (emphasis laid by this Court)

10. In the light of the above legal principle laid  

down by this Court, the High Court was correct in  

holding that presumptions have been made by the  

1

Page 12

Crl.A.@SLP(Crl.) No. 8101 of 2009

trial court where it was not necessary in fact  

situation  at  hand.  The  decision  reached  by  the  

trial  court  is  not  sustainable  in  law  and  is  

liable to be quashed. We concur with the decision  

of the High Court holding that it was correct in  

redirecting  the  matter  to  the  trial  court  for  

adjudication on merit.  

11. For the reasons stated supra, the appeal is  

dismissed.  The  stay  granted  by  this  Court  vide  

order dated 30th October, 2009 stands vacated.

……………………………………………………………………J.                      [SUDHANSU JYOTI MUKHOPADHAYA]

……………………………………………………………………J.  [V. GOPALA GOWDA]

New Delhi, December 12, 2013

1