T. Kilachand Vs. Sampat Shripat Lambate & Anr  INSC 386 (24 September 1993)
K. Jayachandra (J) Reddy, K. Jayachandra (J) Ray, G.N. (J)
1994 AIR 583 1994 SCC Supl. (1) 543 JT 1993 Supl. 332 1993 SCALE (3)876
Judgment of the Court was delivered by K.JAYACHANDRA REDDY, J.- All these
appeals and the connected SLPs arise out of a common judgment of the High Court
of Judicature at Bombay. They can be disposed of by a
common judgment here.
complainant Sampat Shripat Lambate, the Secretary of the Dig vijay Mills
Employees Cooperative Credit Society Limited filed a private complaint in the
court of the Metropolitan Magistrate, 6th Court, Mazagaon, Bombay alleging that
the eight accused shown in that complaint misappropriated amounts belonging to
the Society and thus committed an offence punishable under Section 147(b) of
the Maharashtra Cooperative Societies Act, 1960 and Section 409 read with
Section 114 of the Indian Penal Code. It was alleged in the complaint that the
members of the complainant Society are the employees of the Digvijay Mill Ltd.
Accused 1 was the Chairman and accused 2 to 7 were the Directors of the Mill
and accused 8 was the Secretary of the Board of Directors. The Society used to
advance loans to its members and under an agreement with the Management of the
Mill, the Mill used to recover loans advanced to the members from the salaries
payable to such members and the amount so collected was to be paid by the
Management to the Society. According to the complainant in the month of June
1964 the Management collected certain amounts by deducting instalments from the
salaries and out of that some amounts were paid as loan to the Society and the
balance was misappropriated by the accused. The similar allegations are made in
respect of the collections made up to the year 1968. In respect of these
collections, 12 cases were filed before the trial court.
complaints themselves were filed in the year 1976 i.e. after eight years. The
trial court examined the complainant as PW 1 who stated that accused 1 alone
was looking after day-to-day affairs of the Mill and the Society has demanded
the amounts from accused 1 alone. On the basis of this evidence, the trial
court held that accused 1 alone could be charged only under + From the Judgment
and Order dated August 21, 1991 of the Bombay High Court in Crl. A. No. 339 of
1980 544 Section 406 IPC and in that view other accused were discharged.
Regarding the offence under Section 147(b) of the Maharashtra Cooperative
Societies Act, 1960, the trial court held that the offence was clearly barred
under Section 468 CrPC. When the charge under Section 406 IPC was read over and
explained to the accused, he pleaded not guilty.
however, stated that there was an oral agreement between the Society and the
Management and the Management used to retain part of the salaries payable to
the employees but the same was not misappropriated by the Management as
further stated that the Mill was running at a loss and due to financial
difficulties the amounts could not be paid to the Society. He also stated that
these amounts were not used by him or any other Director for their personal
he cannot be held guilty for any offence. The trial court examined the evidence
of PW 1 in detail. In crossexamination, it emerged that the full salaries were
not paid to the members and only part of the salaries were paid after deducting
the instalments payable to the Society. PW 1 also admitted that as the Society
could not get the amounts either from the Collector or from the Government, it
filed the complaints against the Directors and he further admitted that the
Society filed the complaints only to recover the amounts and not because the
Directors misappropriated the said amounts. Taking these admissions into
considerations, the trial court held that the amounts could not be paid to the
Society because of the financial difficulties of the Mill and the only remedy
open to the Society is to approach the Government and if the Government fails
to pay the amounts then the Society can seek the remedy in the civil court. The
learned Magistrate also held that as the complaints are filed after eight
years, therefore they are barred by the limitation fixed under Section 468 CrPC.
In that view of the matter, he acquitted the first accused namely the Managing
Director. The Society filed appeals against the order of acquittal before the
High Court and accused 1 appeared as the sole respondent with the State in each
of the appeals. The learned Single Judge of the High Court delivered the
judgment in Criminal Appeal No. 398 of 1990 on his file. The learned Judge
mainly relied on the statement made by accused 1, the Managing Director and
pointed out that the agreement between the Society and the Mill was admitted
and that the evidence of complainant coupled with the statement would go to
show that the funds deducted on behalf of the Society were retained by the
accused and it was a continuing offence and therefore the limitation described
under Section 468 CrPC does not apply.
the learned Judge allowed all the 12 appeals filed by the complainant and in
each case, he convicted respondent-accused 1 therein namely the Managing
Director under Section 409 IPC and sentenced him to imprisonment in each case
ranging from two years to six months and also directed to pay a fine which
roughly represents the amounts due to the Society.
appears that the learned advocate Mr Shalim Samuel appearing for
respondent-accused 1 died and that nobody represented him before the High
Court. Therefore an application in each of the appeals was filed to set aside
the judgment under Section 482 CrPC. The learned Single Judge dismissed the
applications holding that Section 362 CrPC is a bar for recalling the judgment
in a criminal case.
against the said impugned order refusing to recall the judgment in each of the
appeals, SLP (Criminal) Nos. 4258-59 and 4349-58 of 1991 are filed in this
Court. Questioning the convictions and sentences awarded 545 by theHigh Court,
accused 1 has filed Criminal Appeal Nos. 48-58 of 1992 and 589 of1993.
may not be necessary to go into the question raised in SLP (Criminal) Nos.
4258-59 and 4349-58 of 1991 inasmuch as we proceeded to hear the counsel in the
appeals themselves challenging the convictions. Therefore in SLP (Criminal)
Nos. 4258-59 and 4349-58 of 1991 no orders are necessary and accordingly they
are disposed of.
counsel appearing for the appellant submits that as held by the trial court the
dispute is only of civil nature and there is no misappropriation as such by
anybody and that due to financial difficulties the Mill could not pay the
amounts due to the Society in time. Therefore in such a situation the view
taken by the trial court is quite reasonable and that the High Court erred in
reversing the order of acquittal in each of those cases. It is further
submitted that the appellant (accused 1, the Managing Director) was only
managing the affairs of the Mill and that there is nothing to show that he has
personally misappropriated any of the amounts and that the explanation has been
given by him namely that the Mill was sick and in financial difficulties and
therefore the amounts could not be paid in time.
may also be mentioned at this stage that before the trial court, the charge was
only under Section 406 IPC and the appellant was acquitted of the same. But the
learned Single Judge of the High Court while disposing of the appeals preferred
by the complainant recorded the conviction under Section 409 IPC without any
notice and sentenced him in each case for the said major offence. This Court by
its order dated January 16, 1992 directed the Office to issue a notice in each
of the cases to the appellant as to why sentence of imprisonment should not be
imposed in conformity with the penal provision of Section 409 IPC since it was
noticed that the learned Single Judge committed an illegality in imposing
sentence under Section 409 IPC while the appellant was tried only for an
offence under Section 406 IPC. The appellant undertook to deposit the entire
fine amount in this Court amounting to Rs 5,50,000 and the Registrar was
directed to receive the total amount of fine by way of a draft and deposit the
same to the credit of the above said appeals before this Court.
counsel appearing for the respondent-Society also submits that as deposed by
the complainant before the trial court, the Society is interested only in realising
facts remains that the appellant was not duly represented before the High
Court. That apart, though the charge was under Section 406 IPC only, the High
Court recorded the conviction under Section 409 an aggravated offence. Under
these circumstances, the only option left is to again remand the matter to 1
the High Court. The offence itself is said to have taken place from 1964 to
1968. The Mill also appears to have been taken over as a sick unit.
on behalf of the appellant it is submitted that the amount deposited by him in
this Court will not be claimed by him and the same may be given to the Society
by passing an appropriate order for disbursement of the said amount. Mr Mukul Mudgal,
learned counsel appearing for the respondent- Society also submits that the 7
Society is interested in realising the amount that was due from the Mill and if
the same is realised that would meet the ends of justice.
think that after 24 years it is not a fit case to be remanded. Further the view
taken by the trial court that it is of civil nature, is not an unreasonable one
as to warrant interference in an appeal against acquittal. For all these
reasons, we set aside the impugned orders of the High Court in each of these
appeals and we restore the orders of the trial court acquitting the appellant-accused.
coming to the disbursement of the amount of Rs 5,50,000, an additional
affidavit has been filed by the Secretary of the Digvijay Mills Employees
Cooperative Credit Society Limited-respondent 1 herein, stating that the
Society is very much in existence and is functioning. Along with the affidavit,
the certificate of registration and also the certificate issued by Digvijay
Textile Mills dated July 23, 1993, another certificate issued by the Assistant
Registrar of Cooperative Societies, Bombay and yet another certificate dated
July 22, 1993 issued by the Maharashtra State Cooperative Bank Limited, Lalbaug
Branch, Bombay are filed. The averments in the affidavit as well as in the
above certificates establish that respondent 1-Society is functioning
regularly. Since the amount belonging to the Society is alleged to have been
misappropriated, the amount of Rs 5,50,000 deposited in this Court as directed,
shall be paid to respondent 1 -Society.
Criminal Appeal Nos. 48-58 of 1992 and 589 of 1993 are allowed subject to the
no orders are necessary in SLP (Criminal) Nos. 4258-59 and 4349-58 of 1991 and
they are accordingly disposed of.