ORDER
Das, J.
1. These are three applications on behalf of nine persons for quashing an order of commitment made against them by Mr. S. N. Prasad, Sub-judge-Magistrate exercising first class powers at Patna. The applications are made on behalf of three sets of persons. The application in Criminal Miscellaneous No. 185 of 1951 is on behalf of one Sheonarayan Jais-wal, Proprietor of a distillery known as Man-katha Distillery. The application in Criminal Revision No. 490 of 1951 is on behalf of six railway employees serving at different stations in the system of railway known as O. T. Railway. The third application (Criminal Revision No. 491 of 1951) is on behalf of two persons named Khan Bahadur Habibur Rahman and his son Fidaur Rahman, said to be proprietors of any other distillery known as Sultanganj Distillery. The learned Sub-Judge-Magistrate by his order dated 10-1-1951, committed the aforesaid petitioners to stand their trial in the Court of Session on various charges.
2. The two charges framed against the proprietors of the distilleries are under Section 120B read with Section 409, and Section 420, Penal Code. The three charges against the railway employees are under Section 120B read with Section 409, Section 161. Penal Code, and Section 5, Sub-section (2), Prevention of Corruption Act, 1947 (Act 2 of 1947).
3. Two other persons named A. P. Varma and Bhan Chandra were also committed by the learned Magistrate by his order of the said date. Mr. Bhan Chandra was an Excise Superintendent, who, in. 1947-48, was employed in the office of the Commissioner of Excise, one of his duties being to regulate the issue of permits for the purchase and transportation of molasses from sugar factories in North Bihar. The other man, A. P. Varma, was then Head Clerk in that office. These two persons had earlier made applications to this Court for quashing the commitment order against them. Those applications (Criminal Misc. Nos. 62 and 63 of 1951) were heard by a Bench of two Judges and by an order dated 24-4-1951, the order of commitment against them was quashed.
4. The facts out of which these applications have arisen are shortly these. Two separata investigations were started by the Provincial C. I. D. and the Delhi Special Police Establishment in connection with alleged illegal disposal of distillery molasses. Several persons, including one Ramji Lal Marwari, his servant and agents, were alleged to have taken part in the disposal thereof. The case which the prosecution alleged was of the following nature. The sugar factories situated in North Bihar produced molasses in the process of manufacturing sugar. Three such factories were situated at Bagaha, Si-talpur & Harinagar. The distribution, supply and price of molasses, produced by the factories in the province of Bihar, were controlled, first by means of an Ordinance known as the Bihar Molssses (Control) Ordinance, 1946, and then under the Bihar Molasses (Control) Act, 1947.
Under the provisions of the Ordinance and the Act, the Excise Commissioner was the Controller. Without the permission of the Controller, no molasses could be moved by rail or river from any place in the province to any
other place therein. The Controller had power to issue directions to the owner or occupier of any factory etc. to supply molasses to the Provincial Government or to Distilleries cr to other persons or organisations. The Provincial Government (now the State Government) had the power to fix the price of molasses. The sugar factories with which we are concerned in the present case were the three sugar factories whose names I have mentioned above. The two distilleries which concern us are the Man-katha and Sultanganj Distilleries.
The prosecution case was that the proprietors of the said, distilleries obtained permits from the Excise Commissioner for lifting molasses from the aforesaid three sugar factories in North Bihar. The Excise Commissioner granted permits, as also issued directions, for the purpose. The Molasses obtained on such permits or directions were taken to Samastipur or Semaria Ghat — two stations of the O. T. Railway system. Permission was also obtained from, the Excise Commissioner to transport the molasses by river from Semaria Ghat. It was alleged that Ramji La’1 Marwari was employed as the agent for the lifting of molasses by the proprietors of the two distilleries. Ramji Lal and his men made the necessary arrangements for lifting molasses front the sugar factories and transporting them by rail or otherwise to Samastipur and Semaria Ghat.
Part of the molasses thus obtained on permits was not taken to the distilleries, but was sold in the black-market at Samastipur and other places; part was sent to Bengal and part to other places in Pakistan or outside Bihar. It was alleged by the prosecution that for the purpose of selling molasses (the learned Magistrate has called such molasses Government sponsored molasses) in the black-market a conspiracy was formed by the proprietors of the distilleries, Ramji Lal and his men, railway employees and certain Excise Officers. In pursuance of this conspiracy, the Excise Officers Issued permits on payment of illegal gratification, the railway employees arranged for the delivery and booking of wagons on payment of Illegal gratification, and the profits were shared by the proprietors of distilleries, Ramji Lal Marwari and his men, and the Excise Officers. This was the nature of the conspiracy which the prosecution alleged.
I may state here that molasses were required by distilleries for the purpose of manufacturing liquor including country spirit, molasses being the raw material from which spirit was manufactured. The proprietors of the distilleries held licenses for the manufacture of liquor, the terms whereof I shall presently state. The conspiracy, it was alleged, was formed between June 1947 to March, 1948. As a result of this conspiracy, Government, it is alleged, was cheated, and illegal gratification etc. was paid to Excise Officers and railway employees.
5. I have stated above that two separate investigations were started, in respect of this illegal disposal of distillery molasses, by Provincial C. I. D. and the Delhi Special Police Establishment. The investigation by the Provincial C. I. D. was started on a first information made by Inspector Baijnath Jha on 19-3-1348; the other investigation was started on the information of one Jogendra Thakur, a servant of Ramji Lal Marwari, dated 5/7-3-1948. The Provincial Police submitted a charge-sheet
on 4-11-1948 against Ramji Lal Marwari, his servants and some other persons, showing some of the railway employees as witnesses. Cognizance of this case was taken by the Subdi-visional Magistrate of Samastipur, While the case was pending before the Subdivisional Magistrate, Samastipur, an application was made to this Court for transfer of the case to a competent Court of some other district. This Court by its order dated 12-1-1949, transferred the case to the Court of the Subjudge-Magis-trate at Patna and ultimately the case came up for trial in the Court of Mr. S. N. Prasad, Subjudge-Magistrate.
While the case was pending in his Court, the Central Police submitted a charge-sheet on 24-5-1949, against several persons, including the railway employees. This supplementary charge-sheet was under various sections of the Indian Penal Code as well as under Section 5, Prevention of Corruption Act, 1947. On 25-5-19-19, the Special Public Prosecutor, who was engaged for conducting the case, made an application, to the Court for the withdrawal of the case against Ramji Lal Marwari and his men on the ground : that he wanted to examine them as prosecution witnesses. The learned Magistrate gave his consent as required by Section 494, Criminal P. C.., and by his order dated 25-5-1949, allowed the prayer for withdrawal and discharged Ramji Lal Marwari and his servants.
The trial commenced on 23-6-1949, and the procedure adopted, at the instance of the Public Prosecutor, was that of a warrant case as laid down in Chapter 21, Criminal P. C. In all 99 prosecution witnesses were examined, including Ramji Lal Marwari and his servants. The prosecution closed its case on 18-3-1950. After hearing arguments, on the evidence for seven days, the Court framed charges on 11-5-1950 under several sections of the Penal Code and also under Section 5, Sub-section (2), Prevention of Corruption Act, 1947. t The last mentioned charge is triable exclusively by the Court of Session under the provisions of Section 29 read with Schedule II, Criminal P. C. Apparently, the learned Magistrate did not realise this and arranged for cross-examination of the prosecution witnesses under Section 256, Criminal P. C. to commence on 25-5-1950. On that date, however, a peti- tiqn was filed by the Public Prosecutor to commit the case to the Court of Session.
After some unnecessary adjournments, the-learned Magistrate decided to proceed under Chapter 18 of the Code from the stage of Section 210. The accused persons wanted to cross-examine the prosecution witnesses on the ground that they had the statutory right under Section 208 of the Code to cross-examine the prosecution witnesses before commitment. This was refused by the learned Magistrate. There was then an application to this Court, and this Court by its order dated 8-8-1950, set aside the charges framed by the learned Magistrate and directed that the case do proceed from stage of Section 208 (2), Criminal P. C. Thereafter, the learned Magistrate allowed fresh cross-examination of some of the witnesses. Mr. A. N. Omar, the then Excise Commissioner, was examined as a court witness. Thereafter, fresh charges were framed and the petitioners were committed to the Court of Session, by an order of the learned Magistrate dated 10-1-1951.
6. It would be convenient to take up the application of the railway employees separately
from the applications of the distillery proprietors. I proceed to consider the application of
the railway employees first.
7. There are six railway employees : (1) B. K. Banerjee, who was at the relevant dates, Assistant Goods Clerk at Samastipur; (2) S. N. Chatterjee, Loading Foreman at Samastipur; (3) N. K. Das, Mileage Clerk of Samastipur; (4) S. N. Ghosh, Station Master, Semaria Ghat; (5) B. N. Mukherjee, Goods Clerk at Semaria Ghat; and (6) Ajab Lall Missir, Tally Clerk at Semaria Ghat. On behalf of these six petitioners, a point of law has been taken that with regard to the alleged offences under Section 161, Penal Code, and Sub-section (2) of Section 5, Prevention of Corruption Act, 1947, the learned Magistrate took cognizance in violation of the provisions of Section 6, Prevention of Corruption Act, 1947; therefore, the order of commitment is bad in law. Section 6 states, ‘inter alia’ that no Court shall take cognizance of an offence punishable under Section 161, Penal Code, or under Sub-section (2) of Section 5 of this Act (meaning the Prevention of Corruption Act, 1947), alleged to have been committed by public servant, except with the previous sanction (as the case may be) of the Central Government, the Provincial Government, or the authority competent to remove the public servant from his office.
In the case before me, Clause (c) of Section 6 admittedly applied, and previous sanction of the authority competent to remove the petitioners was necessary before the offences under Section 161, Penal Code, and Sub-section (2) of Section 5, Prevention of Corruption Act, 1947, could be taken cognizance of. by a Court. The facts necessary for determination of this point are these : I have already stated that the supplementary charge-sheet against these petitioners was submitted on 24-5-1949. The learned Magistrate dealt with this supplementary charge-sheet by his order dated 25-5-1949. On that date the Special Public Prosecutor filed a petition to the effect that two of the petitioners, who were cited in the previous charge-sheet as witnesses, should now be removed from that category, as they were shown in the category of accused persons in the supplementary charge-sheet.
The Special Public Prosecutor filed another petition in which he prayed that the case instituted as a result of the investigation made by the Delhi Special Police Establishment should be called for from the Subdivisional Magistrate, Samastipur, and amalgamated with the case before the Subjudge-Magistrate. This prayer was also allowed. In the supplementary charge-sheet filed against the petitioners, they were shown as being on bail. On 26-5-1949, these petitioners appeared before the learned Magistrate, who enlarged them on bail of Rs. 2,000/-each with two sureties of the like amount. One of the petitioners- N. K. Das, who was absent was directed to appear on the next date.
On 26-5-1949, the Special Public Prosecutor also moved for an adjournment on the ground that sanction of the competent authority has not been received as against the railway em-ployees against whom a charge-sheet had been submitted. The record shows that the necessary sanction was given by Mr. A. K. Basu, General Manager, O. T. Railway, on 15-6-1949. The question is, did the learned Magistrate take cognizance against these railway employees without the previous sanction of the competent authority? The same point was considered in
Criminal Misc. Nos. 62 and 63 of 1951 and it was pointed out :
“The idea which appears to prevail that sanction need not be accorded before the submission of a charge-sheet, provided that it is accorded before the commencement of the trial is erroneous vide — ‘Basdeo Agarwalla v. Emperor’, AIR 1945 F C 16 (A).”
In — ‘Basdeo Agarwalla’s case (A)’, the relevant provision was Clause (16), Drugs Control Order, 1943, which stated :
“No prosecution for any contravention of the provisions of this order shall be instituted without the previous sanction of the Provincial Government…..”
Their Lordships said that sanction was not intended to be, and should not be, an automatic formality and should not so be regarded either by the police or officials. It was observed that a decision as to whether prosecution should be started or not must be made before a prosecution is actually started, & a sanction after a prosecution had been started was a very different thing. It was held in that case that where prosecution is initiated without the requisite sanction, the prosecution should be regarded as completely null and void, and if sanction is subsequently given the new proceeding should be commenced ‘ab initio’. The wording of Clause (16), Drugs Control Order, was different from the wording of section of the Prevention of Corruption Act, 1947. In the Drugs Control Order, the wording was — “No prosecution shall be instituted without the previous sanction etc.”; whereas in Section 6, Prevention Act, 1947, the wording is —
“No Court shall take cognizance of an offence under Section 161, Indian Penal Code, etc, without the previous sanction of the competent authority.”
The question naturally arises, when did the learned Magistrate take cognizance of the offences alleged against the petitioners under Section 161, Penal Code, and Section 5, Sub-section (2), Prevention of Corruption Act, 1947? On the point as to when cognizance is taken, there is a recent decision of the Supreme Court of India in — ‘R. R. Chari v. State of Uttar Pradesh’, AIR 1951 S C 207 (B). Their Lordships quoted with approval the observations made by Das Gupta, J. in — ‘Supdt. and Remembrancer of Leeal Affairs, West Bengal v. Abani Kumar’, AIR 1950 Cal 437 (C). The observations are to the following effect :
“What is taking cognizance has not been defined in the Criminal Procedure Code and I have no desire to attempt to define it. It seems to me, clear, however, that before it can be said that any Magistrate has taken cognizance of any offence under Section 190(1)(a). Criminal P. C., he must not only have applied his mind to the contents of the petition but he must have done so for the purpose of proceeding in a particular way as indicated in the subsequent provisions of this Chapter, proceeding under Section 200 and thereafter sending it for inquiry and report under Section 202. When the Magistrate applies his mind not for the purpose of proceeding under the subsequent sections of this Chapter, but for taking action of some other kind, e.g., ordering investigation…..under Section 156(3), or
issuing a search warrant for the purpose of the investigation he cannot be said to have taken cognizance of the offence.”
Applying the principle laid down in the decision referred to. above, it seems clear to me that the learned Magistrate took cognizance of the case against the railway employees before sanction from the competent authority had been obtained. The learned Magistrate had before him the charge-sheet against the petitioners –a charge sheet on which the learned Magistrate could take cognizance under Clause (b) of Section 190(1), Criminal P. C. He removed some of the petitioners from the category of witnesses to the category of accused persons. He enlarged the petitioners on bail and clearly decided on 26-5-1949, that they were to be tried for the offences mentioned in the supplementary charge-sheet, including the offences under Section 161, Penal Code, and Section 5, Sub-section (2), Prevention of Corruption Act, 1947.
It is clear that the learned Magistrate applied his mind in the sense that he took judicial notice of the offences alleged against the petitioners; in other words, he took cognizance of the offences alleged against the petitioners without the necessary previous sanction. That being the positiqn, there was a violation of the mandatory provisions of Section 6, Prevention of Corruption Act, 1947. The commitment of the petitioners for the alleged offences under Section 161, Penal Code, and Section 5, Sub-section (2), Prevention of Corruption, Act, 1947, is for that reason, bad in law and cannot be upheld.
8. There is also a charge of criminal conspiracy against these petitioners (railway employees). That charge, I think, can be best considered when I take up the case of the distillery proprietors, which I proceed to do now.
9. With regard to the case of the distillery proprietors, the most important point which has been urged before me on behalf of the petitioners is that, on the evidence given against the petitioners, no offence of cheating or of a criminal conspiracy to commit criminal breach of trust has been disclosed or can be sustained in law; therefore, the commitment of the petitioners on those charges is bad.
10. There is voluminous evidence in the case and learned Counsel for the parties rightly thought it unnecessary to take me through the entire evidence in the case. 1 am not the trying Court nor the appellate Court. All that I have to see at the present stage is, whether there is ‘prima facie’ evidence in support of the charges framed by the learned Subjudge-Magistrate, and if the learned Subjudge-Magis-trate correctly understood the legal position with regard to those charges. The principal witness for the prosecution was Ramji Lal Marwari and parts of his evidence have been placed before me. There seems to be no doubt, on the evidence given in the case, that molasses were obtained and moved from the three sugar factories on permits and some of the molasses so obtained did not reach the distilleries, but were sold in the black market at Samastipur, Semaria Ghat or at other places in and outside Bihar.
There is also no doubt that Ramji Lal Marwari was the “arch villain of the piece”, and : he and his servants sold the molasses in the black market, I think it is more than likely, whether there be a conspiracy or not, that the distillery proprietors in whose favour the permits were issued, as also the Excise Officers who issued the permits, knew what was going on. The evidence of Ramji Lal Marwari was to
the effect that an arrangement was struck between the distillery proprietors, himself and the Excise Officers by which the profits made on the disposal of molasses in the manner stated above, were to be divided or shared. Ramji Lal’s case was that money was paid to the Excise Officers in the presence of Mr. Omar at the latter’s house.
There is also evidence in the record to show that Mr, Bhan Chandra and Mr. Omar stayed in the same hotel in Calcutta, the hotel being at one time, owned by Khan Bahadur Habibur Rahman. Mr. Omar, who was examined as a court witness, stoutly denied that any money was paid to Excise Officers in his presence. Mr. Omar was not an accused person in the case and it is unnecessary for me at this stage to consider the truth or otherwise of the statements made by the, different witnesses, including Ramji Lal Marwari, his men and Mr. Omar. I propose to consider this case on the footing that the statements made by the principal witnesses for the prosecution, including Ramji Lal Marwari, were the main basis of the prosecution case.
11. As to the charge of cheating, I fail to see how that charge is at all sustainable. The charge of cheating framed by the learned Magistrate states :
“That you between June, 1947 and March, 1948 at Patna and other places cheated the State of Bihar in the Excise Department by intentionally and dishonestly inducing the Excise Commissioner of Bihar to allot Government sponsored molasses and grant permits for lifting the same from. Bagaha, Sitalpur and Harinagar Sugar mills for manufacture of liquor for you to be supplied to Government Warehouses which intention you never possessed and after getting the allotments by means of permits got the molasses lifted which allotments or permits the Commissioner of Excise would not have made or granted but for the deception practised on him by you.”
The offence of cheating is defined in Section 415, Penal Code, as follows :
“Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm, to that person in body, mind, reputation or property, is said to ‘cheat’.
Explanation — A dishonest concealment of facts is a deception within the meaning of this section.”
It is obvious that in an offence of cheating one person cheats and another person is cheated. The person who cheats practises deception either by a dishonest concealment of facts or otherwise. Deception is, therefore, an essential ingredient of the offence. The result of the deception is to induce, fraudulently or dishonestly, the person deceived to deliver any property etc. to any person, or intentionally inducing that person to do or omit to do anything etc. Here, the prosecution case was that the persons who granted the permits as well as the persons who obtained the permits were all in the conspiracy, so that there was no question of one deceiving the other. The learned Magis
trate has stated that the permits were granted mostly under the signature of Mr. Bhan Chan-dra. A few of the permits were granted under the signature of the Personal Assistant to the Commissioner of Excise when Bhan Chandra was on tour.
There is evidence, to which the learned Magistrate has referred, that Mr. Bhan Chandra recommended the issue of permits to the distilleries. If the evidence of Ramji Lal Marwari is correct — it is really on his evidence that the prosecution case mainly rests — then, the Excise Officers who issued the permits, including Mr. A. N. Omar, knew what wag going on. Therefore there was no question of one person cheating another; everyone of them knew what was going on. Under the Molasses (Control) Ordinance and the Molasses (Control) Act, to which I have made a reference, the Controller had to grant the permits. If the Controller himself knew what was being done, I fail to see how any question of cheating can arise.
The learned Magistrate has framed the charge in such a way as to say that it was the State of Bihar which was cheated. But under the provisions of the Bihar Molasses (Control) Ordinance and the Bihar Molasses (Control) Act, the duty of issuing permits rested with the Controller. If the Controller granted permits in the full knowledge of all the facts, or if Mr. Bhan Chandra granted the permits under the authority of the Controller in the full knowledge of facts, there was no deception whatsoever and the essential ingredient of deception in the offence of cheating was absent. My view is that on the prosecution case as sought to be made out by the evidence of Ramji Lal Marwari, there was no cheating and the learned Subjudge-Magistrate did not correctly appreciate the legal position.
12. I now proceed to consider the charge relating to a conspiracy to commit criminal breach of trust, which raises a somewhat more difficult question. Here again, I think that the learned Magistrate did not appreciate the correct legal position. Mr. Omar stated in his evidence that the price fixed for molasses was four annas for North Bihar and eight annas for South Bihar. Obviously, the distilleries paid the price at that rate before lifting the molasses from the sugar factories. The price was, presumably, fixed under the provisions of the Bihar Molasses (Control) Ordinance or Act. The distilleries required the molasses for the purpose of manufacturing liquor, including country spirit. The learned Government Advocate has referred me to three licenses in form no. 27, form no. 28 and form no. 29 at pages 199 to 206 of the Bihar and Orissa Excise Manual, 1919, Volume II.
The license in form no. 27 is a license for the wholesale sale of country spirit in a particular area. It is a license granted under the provisions of Section 20, Bihar and Orissa Excise Act, 1915. The license in form no. 28 is a license to manufacture spirit in a distillery, issued to the grantee of an exclusive privilege of supply of country spirit under Section 22, Bihar and Orissa Excise Act, 1915. The third license in form no. 29 is a license to manufacture spirit in a distillery in Government premises issued to the grantee of an exclusive privilege of supply of country spirit under Section 22, Bihar and Orissa Excise Act, 1915. Licenses in these forms were granted to the two distilleries. I have examined
the terms of the licenses. Under those terms, the spirit manufactured at the distillery could not be sold elsewhere except at a warehouse, unless sanctioned by the Excise Commissioner, and the sale had to be made only to licensed vendors.
The spirit manufactured and supplied to the warehouse within the contract area of the license was to be paid for according to the prices or rates specified in the license. The price paid was to be collected by the Collector, who made a monthly adjustment. One of the clauses made it obligatory on the licensee to supply spirit on demand by the Collector, and failure to supply spirit made the licensee liable to a penalty at the discretion of the Commissioner of Excise. I do not, however, find any term in the license which would show that the molasses which the distilleries obtained as raw materials were to be treated as other than the property of ths distilleries which had paid the price thereof. As a matter of fact the terms of these licenses do not refer to molasses at all; nor do they refer to any obligation attaching to whatever raw material the licensee may use for the manufacture of spirit. Apparently, the licensee is free to use any raw material he likes such as molasses or ‘mahua’. In one of the proceedings of a conference of distillers held on 7-1-1947, in the office of the Commissioner the following occurs (vide Ex. H-6) :
“At the beginning the Excise Commissioner explained that the Excise Department does not guarantee the procurement of molasses and wagons for transport of spirit, etc. It would simply assist the distillers as it has done heretofore.”
As far as I can make out, the correct position is that the distillers, who worked under licenses granted to them, required molasses as raw material : for movement of molasses they obtained permits from the Excise Commissioner; they paid for the molasses as also for the transport of the molasses to the distilleries; they manufactured spirit out of the molasses and sold the spirit to the warehouses or licensed vendors under the terms of the licenses granted to them. In the circumstances stated above, I do not see how can it be said that the property in molasses or any dominion over them was “entrusted” to the distillers.
13. The offence of criminal breach of trust, is defined in Section 405, Penal Code. One of the essential conditions is that the property which is the subject-matter of the offence must have been entrusted to a person : a trust of some kind is necessary, and the property in respect of which criminal breach of trust can be committed must be either the property of some person other than the person accused, or the beneficial interest in or ownership of it must be in some other person and the offender must hold such property on trust for such other person or in some way for his benefit. In all the cases given in the illustrations to Section 405 in which a person is said to have committed the offence, the property in respect of which it is said to have been committed is the property of another person or property of which the offender was not the beneficial owner, although in one case, that of the executor, he had the legal title.
I fail to see how it can be alleged in this case that the molasses which the distilleries had purchased were the property of any person
other than the distillers themselves. I doubt if the Commissioner of Excise had any beneficial interest in the molasses, though he may have such interest in the spirit if and when such spirit is manufactured from the molasses. I have already referred to the terms of the licenses, which say nothing about raw materials for the manufacture of spirit. The permits, it may be stated, do not attach any obligation to the ownership of molasses : they relate merely to ‘movement or transport’ of molasses from one place to another, as contemplated by Section 4, Bihar Molasses (Control) Act.
Therefore, I do not think that it can be said that any obligation was attached to the ownership of molasses, such as would constitute a “trust” within the meaning of Section 405, Penal Code, either by reason of the terms of the licenses or permits. The express conditions of the permits would be fulfilled as soon as the molasses were moved from one place to another as stated in the permits — whether the molasses be used for liquor or not. If it be assumed that it was an implied condition of the grant of permits that the molasses would be used ‘only’ for the manufacture of liquor — it is difficult to assume that as an implied condition when both parties knew or intended that the molasses would be sold in the black market — I am by np means satisfied that a violation of that condition would be anything more than a mere breach of contract.
It may be that the permit holders contravened a particular direction or order of the Excise Commissioner. If they did so, they would be liable under Clause 9 of the Ordinance or Section 10, Bihar Molasses (Control) Act, 1947. That, however, is not the charge against the petitioners, and no evidence was brought to my notice relating to the contravention of a particular order or direction of the Commissioner. A case of such contravention, if any, will be triable by the Magistrate and not by the Court of Session. The charge against the petitioners, is that they entered into a conspiracy to commit criminal breach of trust : that charge, in my opinion, is not sustainable on the evidence given in the case. A mere breach of contract or a breach of the conditions of a permit is not necessarily synonymous with criminal breach of trust. I may here give details of one of the permits, as an example.
OFFICE OF THE COMMISSIONER OF EXCISE, BIHAR
Memo 752 M. C. Patna, the 6.12.1947
BIHAR PERMIT No. 33 M. C. DATED 6.12.1947.
COUNTERFOIL
Name of Permit holder
…
Ranchi & Mankatha Distilleries
Name of consignor (if he is not a permit holder.)
|
|
|
|
Do.
Name of consignee (if he is not a permit holder.)
Place of despatch……………………..
…
Sitalpur Sngar Works Ltd. (Sitalpur).
Destination…………………………..
…
Ranchi & Mankatha via Semariaghat Mokam ehghat and Ranchi Road.
Qunntity of molasses to be despatched
…
10,000 mds. only
Period of currency of the permit
…
25-1-48
Sd. B. CHANDRA
For Commissioner of Excise, Bihar.’
The learned Government Advocate has referred me to the decision in — ‘Nrigendro Lail v. Okhoy Coomar’, 21 W R Cr 39 (FB) (D) in which the question considered was whether, if a partner dishonestly misappropriated or converted to his own use, or dishonestly used or disposed of any of the partnership properties which he was entrusted with or had dominion over, he was guilty of an offence under Section 405, Penal Code. It was held that the words of Section 405 were large enough to include the case of a partner, if it were proved that he was in fact entrusted with the partnership property or with a dominion over it and dishonestly misappropriated it, or converted it to his own use. It was pointed out, however, that it was a question of fact whether there had been an entrusting of the property or any dominion over it sufficient to come within what was required.
I do not see how the principle of that decision can be applied to the facts of the present case. The case before me is not one in which the Excise Commissioner or the Controller was a partner with the distillers in respect of the molasses. The Excise Commr. or the Controller merely helped the distillers to get molasses at a concessional or nominal rate. This help was given because the distillers were under an obligation to supply spirit to the warehouse, and unless they got the raw material they could not do so. The reports of the proceedings of some of the conferences of distillers with the Excise Commissioner, show that the distillers made a grievance of the fact that unless a supply of raw material was assured they could not manufacture spirit and sell it at a rate fixed by Government; nor could they be liable for a penalty for non-supply of spirit when required by the Controller.
It was for the purpose of maintaining a supply of spirit that the Controller helped the distillers in getting molasses at a concessional or nominal rate. From this help, however, it is impossible to spell out “an entrustment” of the molasses or of a dominion over them. So far as I have been able to appreciate the facts, the legal position is that the molasses were purchased by the distillers, no doubt at a concessional or nominal rate, and moved on permits issued by the Controller; the molasses so purchased were the property of the distillers and it cannot be said that there was any “entrustment” of the property by or on behalf-of the Excise Commissioner or the Controller, The charge relating to a criminal conspiracy to commit criminal breach of trust appears to me to be based on a misappreciation of the correct legal position. The prosecution evidence, even if accepted as correct, does not make out any charge of criminal breach of trust or of a conspiracy to commit criminal breach of trust.
14. I have said that the distillers may have been guilty of contravening an implied or express condition of the permits. I do not say anything final as to that, because the prosecution case did not proceed on that basis. Clause
9, Bihar Molasses (Control) Ordinance, and Section
10. Bihar Molasses (Control) Act, 1947, punishes a contravention of or a non-compliance with any order or direction issued by the Controller. Whether the breach of an implied condition of a permit is a breach of an order or direction issued by the Controller, is open to some
doubt : it may be an illegality without being an offence under Clause 9 of Section 10. The punishment provided by Section 10 for a contravention or non-compliance with an order or direction of the Controller is three years, and under Schedule II, Criminal P. C. will be a cognizable offence. Learned Counsel for the petitioners has contended before me that a sanction under Clause (1)
of Section 196A, Criminal P. C., was necessary in this case; because the object of the conspiracy, assuming but without conceding that there was a conspiracy, was to commit an illegal act other than an offence, or a legal act by illegal means. Clause (2) of Section 196A applies where the conspiracy is to commit a non-cognizable offence or a cognizable offence not punishable with death, transportation, or rigorous imprisonment for a term, or two years or upwards. I do not think that it is necessary for me to decide whether in, this case a sanction was necessary either under Clause (1) or Clause (2) of Section 196A, Criminal P. C. As I have stated, the prosecution case did not proceed on the footing that there was a conspiracy to commit a contravention of an order or direction of the Controller or of a violation of a condition of the permit. It is sufficient for me to state that on the prosecution evidence the charge of a conspiracy to commit criminal breach of trust is not sustainable in law, and the learned Magistrate did not correctly appreciate the legal position with regard to that charge.
15. It was contended before me that so far as Sheonarayan Jaiswal, proprietor of Man
katha Distillery, was concerned, he appointed Ramji Lal Marwari On 11-1-1948 (vide Ex. 61/ 1), and the finding of the learned Magistrate is that the bribes offered were all offered by Ramji Lal before that date, except one the evidence regarding which the Court did not accept as correct; therefore, Sheonarayan Jaiswal could not be a party to the conspiracy, assuming that there was a conspiracy. It is not possible for me, at this stage, to examine the
evidence in the way in which the trial Court or the appellate Court examines it. I have considered this case assuming that the prosecution evidence, particularly the evidence of Ramji La], is correct. On that evidence, the charge of conspiracy to commit criminal breach of trust is not maintainable.
16. As to the railway employees, the position is still worse. All that is alleged against them., so far as the conspiracy charge is concerned, is that they allowed delivery qf some of the molasses at Samastipur or Semaria Ghat and provided facilities for rebooking of wagons to other places in and outside Bihar. I find! it difficult to believe how that would prove that they had entered in a conspiracy to commit criminal breach of trust. The worst that can be said is that on payment of illegal gratification they had allowed re-booking in violation of rules of traffic or orders of the higher railway authorities. There is nothing to show that they knew anything about the permits or the conditions of the permits under which the molasses were booked from the sugar factories to other places.
The suggestion that they were members of the same conspiracy into which Ramji Lal had entered with the distillery proprietors and Excise Officers seems to me to be totally unjustified by the evidence in the record. If I
am wrong in my view regarding the legal position as respects the charge of a conspiracy to commit criminal breach of trust, I am nevertheless of the opinion that the railway employees cannot be tried along with the distillers on such a charge. Moreover, cognizance of the charge under Section 5, Sub-section (2), Prevention of Corruption Act, having been wrongly taken, the other charges were triable by a Magistrate and need not have been committed to the Court of Session.
17. This case is an unfortunate case in more senses than one. There is no doubt that molasses were obtained and moved on permits and a good part of it was sold in the black-market. A lot of time was spent by the learned Magistrate in examining a large number of witnesses. A Special Public Prosecutor was appointed to conduct the case. But instead of running straight-forward cases against public officers who had taken illegal gratification, or granted permits on taking illegal gratification, after obtaining first the necessary sanction a complicated case of a conspiracy on the basis of charges which could hardly be sustained in law, was sought to be made out.
The result has been a confusion which, I feel, clouded the real issues, and after spending so much time and money, the prosecution finds itself at a dead end. It would have been far more convenient and prudent to run straight-forward cases, after obtaining the necessary sanction, against public officers who had taken illegal gratification, and against those who had either contravened or failed to comply with any order or direction of the Controller. There might conceivably be a case of abetment of bribery against Ramji Marwari and others, which would have been triable by a Magistrate. But none of these simple courses were followed.
18. The result is unfortunate in that the order of commitment against the petitioners of the three applications has to be quashed for the reasons given above. I regret the delay in passing orders in this case. I had heard the applications a few days before I was due to leave for England on leave. I had been in the midst of some big cases on my return from England and the record of this case is so voluminous and so badly arranged that it has taken me some time to trace the necessary papers.
19. For the reasons given above, I would allow the applications and quash the commitment order passed against the petitioners. The Rules are disposed of accordingly. I say nothing as to what future action, if any, should be taken against the petitioners or any of them : that is a matter which must be left to the proper authorities.