Kewal Krishan and others vs State of Punjab

Mr. M.M. Punchhi, J.

These are three petitioners. Their individual acts, which have given rise to the prosecution, as follows :

Kewal Krishan, petitioner No. 1, as Proprietor of Messrs Amar Foundry and Engineering Works,Batala, moved an application to the Director of Industries Punjab, for allocation of iron and steel for construction of his factory. That application was supported by a plan. The application was recommended by the District Industries Officer, Batala, and the Industries Department in turn advised the Punjab State Small Industries Corporation, Chandigarh, for the supply of iron and steel to that concern. Kewal Krishan petitioner collected the iron and steel.

Santokh Singh, petitioner, Proprietor of Messrs Suraj Foundry and Engineering Works,Batala got iron and steel in the same way for using it for building his factory sheds.

Mohinder Singh, petitioner, Proprietor of Messrs United Foundry and Workshop, Batala,likewise obtained iron and steel for being used in his business premises.

All these collections of iron and steel were made by the accused within the period 19.4.1972 to August 1972. The Vigilance Inspector inspected the business premises of the respective petitioner and found that only a small portion of the material had been used and the rest of it had perhaps been utilised elsewhere. Since at that time the Iron and Steel (Control) JUDGMENT 1956, was operative and clauses 7 and 19 thereof prohibited the used of iron and steel for a purpose other than that for which it had been obtained under the Control JUDGMENT report was lodged against the petitioners for offences under section 420 as also under section 7 of the Essential Commodities Act, 1956 read with clause 7 of the aforesaid Control

In due course, prosecution was launched against the petitioners. In the meantime, gazette notification No. SO. 709(E)/ESSComm/Iron& Steel2A, dated December 17, 1975 appeared on the scene which declared that clauses 7 and19 of the aforesaid Control JUDGMENT shall not apply to the categories of steel and iron or as the case may be, scraps as specified in the schedule annexed to the notification and acquired by any person on or after the date of that notification. The petitioners, on the strength of that notification and on the interpretation put to it in other cases, successfully got the proceedings quashed under section 7of the Essential Commodities Act and thus the only charge which remained against the petitioners was under section 420, Indian Penal Code. In other words the charge pertained to the act or omission of the accused pertaining to the time at which they had applied for the steel and obtained it.What ultimately became of the steel is no body''s concern and for the purpose of disposal of the present revision petition it may safely be taken that the stell was not applied for the purposes for which it had been obtained. Thus, the point to be considered is whether the petitioners had the requisite mensrea to cheat at the time of making the applications and obtaining delivery of the steel. Both the Courts below have maintained the conviction of the petitioners on the fortuitous circumstance that since the steel had not been utilised by them in their respective business premises, their intention to cheat datesback to the time when the steel was applied for and procured. Now is this view sustainable, is the question which needs be settled in this petition.

Section 415, Indian Penal Code, which defines the offence of cheating is in the following terms :

"415. CHEATING. 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."

The Section has two portions. In the first part, there is delivery of property on deception or retention of any property by those means. That part obviously would not apply, for, the petitioners on obtaining the steel paid for it. Thus, there would be no deception involved in the matter of buying steel under the Control JUDGMENTUnder the second part, the Officers of the Industries Department unless assured of the bona fides of the petitioners,would have refused to recommend their case to the Industries Corporations for the grant of iron and steel. In other words,had they not been so deceived,they would not have made the requisite recommendation and then by such act or omission of theirs, what possible damage or harm to the officer''s body, mind, reputation or property, had occurred, is yet to be discerned. Illustration (g)to section 415, Indian Penal Code, which is in the following terms, draws a thin line between what is and what is not deception :

"(g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo plant which he does not intend to deliver and thereby dishonestly induces Z to advance money upon the faith of such delivery. A cheats; but if a, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to civil action for breach of contract."

Now if the petitioners at the beginning, when they made the applications and acquired the iron and steel, had not the intention of misutilising it elsewhere and had acted in such a way to utilise it in their factory premises, then they cannot be said to have deceived or cheated any one. But after having bona fied applied for the commodity and having obtained it, they for some reason or the other, thought not of utilising it there,then they cannot be said to have cheated the Industries Department for the purpose. There is no evidence on the file either way to say as to what was the original intention of the petitioners. The only circumstance which has been sought to be cashed upon by the prosecution is that when the Vigilance Inspector visited the premises in November, 1972, whole of the steel had not been utilised in the respective business premises of the petitioners. That by itself is not a circumstance which would prove the guilt of the petitioners to the hilt. The petitioners could have yet utilised the steel after the visit of the Vigilance Inspector and yet the petitioners may not have utilised the said steel at all at a later stage. In either situation, no inference can be drawn that right from the beginning the intention of the Petitioners was to cheat. Thus, sufficientelement of doubt creeps in. It must go in favour of the petitioners. This is besides the other point raised by their learned counsel that joint trial of the petitioners has led to miscarriage of justice, for their was no connection inter se between the petitioners and no conspiracy alleged against them. This point need not be elaborated any further.

For the foregoing reasons, this petition is thus allowed and the petitioners are extended the benefit of doubt. Their conviction and sentence is thus set aside. Fine, if paid, be refunded to them.