Holding

When a public servant admits entrustment of public funds, the burden shifts to him to prove discharge of that entrustment; failure to do so sustains a conviction under Section 409 IPC.

Summary

The appellant, a junior engineer supervising irrigation tank construction under a government employment guarantee scheme, was alleged to have fabricated muster rolls showing payments to fictitious labourers, thereby misappropriating Rs 6,764.10. Evidence showed that the same 21 labourers were recorded as working simultaneously at three sites, and fingerprint analysis established that the thumb marks on the muster rolls belonged to a single person, the co‑accused, not the named workers. The trial court convicted the appellant under Sections 409, 468, 477A IPC and the Prevention of Corruption Act, but the High Court set aside all convictions except under Section 409 IPC. On appeal, the Supreme Court examined whether the prosecution had proved the essential ingredients of criminal breach of trust under Section 409, particularly the entrustment and misappropriation, and held that where the entrustment is admitted, the burden shifts to the accused to discharge it. Relying on precedents such as Jagat Narayan Jha v. State of Bihar, the Court found the prosecution’s evidence sufficient to establish misappropriation despite the inability to trace the exact mode of diversion. Consequently, the Court dismissed the appeal and upheld the conviction under Section 409 IPC.

Issues considered

Whether the prosecution proved all essential elements of Section 409 IPC (criminal breach of trust) against a public servant.
Whether admission of entrustment shifts the burden of proof to the accused to demonstrate discharge of that entrustment.
Whether the absence of precise proof of the manner of misappropriation defeats a conviction under Section 409 IPC.
Whether fingerprint and village‑kotwal evidence establishing fictitious payments is sufficient to sustain the conviction.

Legislation cited

Indian Penal Code, 1860s. 109, s. 407, s. 409, s. 467, s. 468
Prevention of Corruption Act, 1947s. 5(1)(d), s. 5(2)

Subjects

criminal breach of trustmisappropriation of government fundspublic servantburden of prooffingerprint evidenceSection 409 IPCcorruption

Judgment

MUSTAFIKHAN A
v.
STATE OF MAHARASHTRA

DECEMBER 4, 2006

[DR. ARIJITPASAYAT AND S.H. KAPADIA,JJ.] B

Penal Code, 1860-Section 409-Criminal breach of trust-
Misappropriation of Government money-By Public Servant-Payments made
to fictitious persons proved-Entrustment of money admitted by the accused- C
Conviction-Justification of-Held: Conviction is justified-Where entrustment
of property is admitted by the accused, burden to prove the discharge of the
entrustment lies on the accused-Evidence-Burden to prove.

Appellant-accused was incharge of execution of construction of
irrigation tanks under a Government Scheme. During a particular period D
same set of21 labourers were shown to have been engaged at one and the
same time for construction of the tank at two places. Payments were shown
to have been made by the appellant. In reality bogus names were shown. The
investigation revealed that appellant was responsible for misappropriation.
Accused No. 2 was a labourer engaged and he was made to put his thumb
marks on the muster rolls to show receipt of monies by fictitious persons. E
Both the accused were charged under Sections 409, 407, 468 read with
Section 109 IPC and Sections 5(1)(d) and 5(2) of Prevention of Corruption
Act, 1947. Trial Court convicted appellant-accused of all the charges except
under Section 467 IPC. Accused-2 was acquitted of all the charges. On appea~
High Court convicted the appellant only under Section 409 IPC and acquitted F
him of all the charges. Hence the present appeal.

Dismissing the appeal, the Court
J

HELD: 1. In View of the clinching evidence tendered by the prosecution
which has been analysed at great length by the trial Court and the High Court, G
there is no scope for interference. 119-F-G)

2. In order to sustain a conviction under Section 409 IPC the prosecution
is required to prove that (a) the accused, a public servant was entrusted with
property of which he has duty bound to account for, (b) the accused had
15 H
..

16 SUPREME COURT REPORTS (2006] SUPP. IO S.C.R.

A misappropriated the property. Where the entrustment is admitted by the
accused, it is for him to discharge the burden that the entrustment has been
carried out as accepted and the obligation has been discharged. [18-D-FJ

Jagat NarayanJha v. State of Bihar, [1995[ 4 SCC 518, relied on.

B 3. It is not necessary or possible in every case to prove as to in what
precise manner the accused had dealt with or appropriated the goods. In a
case of criminal breach of trust, the failure to account for the money, proved
to have been received by the accused or giving a false account of its use is
generally considered to be a strong circumstance against the accused.
C Although onus lies on the prosecution to prove the charge against the accused,
yet where the entrustment is proved or admitted it would be difficult for the
prosecution to prove the actual mode and manner of misappropriation and in
such a case the prosecution would have to rely largely on the truth or falsity
of the explanation given by the accused. [18-F-H; 19-A)

D 4. It was found by the trial Court and the High Court with reference to
the evidence on record that payments were shown to have been made to persons
who were found to be fictitious. PW8 - a Finger Print Expert after comparing
the thumb prints, he gave his opinion that the disputed prints were not of any
of the six persons whose prints were submitted to him for examination, but
were of one and the same person. He found that prints in the muster rolls of
E place 'D' were identical with the finger print of the acquitted accused. In
respect of the muster rolls of place 'K' he found lhat the finger prints were
not identical with the specimen impressions of six persons named above, but
they were identical inter se, that is they were of the same person. The evidence
of the village kotwal, also shows that there was no such person in the village
F to whom the appellant claimed to have made payment [19-B-F)

CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 1261 of
2006.

From the final Judgment and Order dated 22-2-2006 of the High Court
G of Judicature at Bombay, Nagpur Bench, Nagpur in Crl. A. No. 32511996.
Garvesh Kabra, Ms. Deepti R. Mehrotra and Ravi Prakash Mehrotra for
the Appellant.

Aniruddha P. Mayee for the Respondent.

H The Judgment of the Court was delivered by
MUSTAFIKHAN v. STATE OF MAHARASHTRA [PASAYAT,J.] 17
Dr. ARI.TIT PASAYAT, J. Leave granted. A
Challenge in this appeal is to the judgment rendered by a learned Single
Judge of the Bombay High Court, Nagpur Bench. By the impugned judgment
the High Court while setting aside the conviction of the appellant for offences
punishable under Sections 468, 477-A of the Indian Penal Code, 1860 (in short
the 'IPC') and Section 5(1 )(d) read with Section 5(2) of the Prevention of B
Corruption Act, 1947 (in short the 'PC Act') maintained the conviction for
j
offence punishable under Section 409 IPC. The trial court had convicted the
appellant for offences punishable under Sections 409, 468, 477 A IPC, Section
5(l)(d) read with Section 5(2) of the PC Act. Different custodial sentences
were imposed along with fine.
c
Background facts in a nutshell are as follows:

The appellant was working as Junior Engineer and was in-charge of
execution of construction of tanks at Kudwa, Dhakni and Mundipar in Gondia
Sub Division. This work was to be executed under the Employment Guarantee D
Sche~e. The appellant was assisted by four muster clerks to keep a track of
persons employed for the work of construction of these tanks. Between
7.1.1976 and 11.3.1976, same set of 21 labourers were shown to have been
engaged at one and the same time for construction of the irrigation tanks at
Kudwa, Dhakni and Mundipar. Payments were shown to have been made by
the appellant, but in reality no such payments were made. Bogus names were E
shown. The investigation revealed that in all a sum of Rs.6,764.10 was
misappropriated by the appellant abusing his position as supervisor. Accused
No.2 was a labourer engaged and he was made to put his thumb marks on
the muster rolls to show. receipt of monies by fictitious persons, who were.
shown to have been engaged for the works. After the report, F.I.R. was F
registered and on completion of investigation, charge sheet was sent up and
trial was held in the Court of Special Judge at Gondia.

Upon consideration of material placed before him, the learned Special
Judge charged both the accused of offences punishable under Sections 409,
467 and 468 read with Section 109 IPC and Section 5(l)(d) and 5(2) of the PC G
Act. Since the accused pleaded not guilty, they were put on trial. In order to
bring home the guilt of the accused, prosecution examined 14 witnesses.
Upon consideration of evidence tendered before him, learned Special Judge
acquitted accused No.2 of all offences and also acquitted the present appellant
of the offence punishable under Section 467 IPC. However, he convicted the
appellant of the other offences and sentenced him as aforementioned. H
18 SUPREME COURT REPORTS [2006)SUPP. IO S.C.R. ...

A Aggrieved thereby the appellant has preferred this appeal.
As noted above, the High Court held that prosecution had not been
able to establish commission of offences other than Section 409 IPC.
Accordingly, the conviction under that pJ10vision was maintained and custodial
sentence of one year and fine of Rs.1,000/- with default stipulation was
B maintained.
;._
Learned counsel for the appellant submitted that the prosecution has
not established the commission of offence punishable under Section 409 IPC.
The essential ingredients necessary to constitute that offence have not been ...
I
proved.
c ·-
It was submitted that the so called fake payment has not been established
and reliance was placed on a decision of this Court in Jnderjit Singh and Ors.
v. State of Punjab and Ors., [1995] Supp 3 SCC 289, to contend that the
accusations have to fail.
D Learned counsel for the respondent-State on the other hand supported
the judgment of the High Court.
',
In order to sustain a conviction under Section 409 IPC the prosecution
is required to prove that (a) the accused, a public servant was entrusted with
property of which he has duty bound to account for, (b) the accused had
E
misappropriated the property.

Where the entrustment is admitted by the accused, it is for him to
discharge the burden that the entrustment has been carried out as accepted
and the obligation has been discharged.
F
The above position was reiterated in Jagat Narayan Jha v. State of
Bihar, [1995] Supp 4 SCC 518.

It is not necessary or possible in every case to prove as to in what
precise manner the accused had dealt with or appropriated the goods. In a
G case of crimin.al breach of trust, the failure to account for the money, proved
to have been received by the accused or giving a false account of its use is
generally considered to be a strong circumstance against the accused.
Although onus lies on the prosecution to prove the charge against the
accused, yet where the entrustment is proved or admitted it would be difficult
for the prosecution to prove the actual mode and manner of misappropriation
H and in such a case the prosecution would have to rely largely on the truth
.( .
MUSTAFIKHAN v. ST ATE OF MAHARASHTRA [PASAYA T, J.] 19
or falsity of the explanation given by the accused. In the instant case, there A
is no dispute about the entrustment.

Learned counsel for the appellant submitted that all through the accused
had taken the stand that the payments were not made by him directly but
through the middle men, who distributed the amount to the persons who were
engaged. This plea has been elaborately dealt with by both the trial Court and B
the High Court. It was the duty of the appellant to make payment. He cannot
j
escape from liability by saying that he had entrusted the job to someone else.
It was found hy the trial Court and the High Court with reference to the
evidence on record that payments were shown to have been made to persons
who were found to be fictitious. PW8 - Arun Borikar is a Finger Print Expert
in Finger Print Bureau and was at the relevant time posted at Nagpur. He C
stated about his qualifications and expertise. He stated that he had received
17 muster rolls and specimen impressions of left and right thumbs of PWs
Nos. 1, 7, 9, 13 and the two accused. After comparing the thumb prints, he
gave his opinion (Exhibit 55). He stated that the disputed prints A and A-1
to A-19 were not of any of the six persons whose prints were submitted to D
him for examination, but were of one and the same person. He found that
prints in the muster rolls of Dhakni Tank at Exhibits B-15, B-4 and B-16 were
)
identical with the finger print of Amarsing Sohanlal, that is the acquitted
accused. In respect of the muster rolls of Kudwa tank, he found that the finger
prints at Exhibits C-1 to C-21 and C-1 (a) and C-2(a) were not identical with
the specimen impressions of six persons named above, but they were identical E
inter se, that is they were of the same person.

The evidence of the village kotwal, who was examined as PW6 also
shows that there was no such person in the village to whom the appellant
claimed to have made payment. The Facts involved in Jnderjeet's case (supra)
are clearly distinguishable. In that case the question was of tallying the thumb F
mark of the appellant with the disputed thumb marks. The factual scenario of
that case was entirely different.

Looked at from any angle in view of the clinching evidence tendered
by the prosecution which has been analysed at great length by the trial Court G
and the High Court, we find no scope for interference.

The appeal, therefore, fails and is dismissed.

K.KT. Appeal dismissed .
.I
H
.J ...