This is a revision petition directed against the order of the Metropolitan Magistrate dated January 30, 1982.
2. The petitioner, Jia Lal Sharma, is the complainant. He filed a complaint against the respondent, Madhavprasad G. Poddar, under Section 409 I.P.C. It was alleged that the petitioner was interested by buying a boiler. The respondent agreed to act as a commission agent in the transaction of purchase on the term that he would charge commission at the rate of 2 per cent from the petitioner. The petitioner paid Rs. 22,000/- to the respondent as advance money. But the transaction fell through. The respondent informed the petitioner that the seller had sold the boiler to another party. On this the petitioner asked for the return of Rupees 22,000/-. The respondent promised to return the money but did not do so in spite of repeated demands. The petitioner's case is that the respondent has dishonestly misappropriated the money and has converted it to his own use and h
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as they committed an offence under S. 409 I.P.C.
3. The petitioner in support of his case filed letters written by the respondent in which he had admitted the receipt of money and had promised to return it. The petitioner also examined himself in support of the complaint. The learned Magistrate dismissed the complaint holding that he did not find any dishonest intention from the letters of the respondent and in any even it was a case of civil liability. From the order of dismissal this revision has been preferred.
4. The respondent is an agent. He is in a fiduciary capacity. He is bound to account for what he has received. He admitted the receipt of money in the letters he wrote to the petitioner. He also agreed to return it. He asked for time to repay in his later dated February 23, 1981 but did not do so. A registered notice dated June 16, 1981 was also sent to him calling upon him to pay Rs. 22,000/-. Yet he did not pay. This is what was alleged in the complaint.
5. In my view the petitioner has made out a prima facie case. The dismissal of the complaint on the ground that there was no sufficient ground for proceeding with it is not justified. The learned Magistrate ought to have issued the process. Failure to account is prima facie evidence of dishonest intention when entrustment is admitted by the agent. All that the Magistrate has to consider is, whether there is prima facie evidence of a criminal offence which, in his judgment, calls upon the alleged offender to answer. (In the matter of the petitioner Ganesh Narayan Sathe (1889) ILR 13 Bom 590 (598)). If the allegations contained in the complaint disclosed a criminal offence, the Magistrate should not dismiss the complaint simply because the case is of a civil nature. (Nilratan Sen v. Jogesh Chundra Bhattacharjee, (1896) ILR 23 Cal 983 (986)).
6. In this case the magistrate has dismissed the complaint on the ground that it does not disclose a dishonest intention on the part of the respondent. He said this : "intention of the respondent has always been to refund the money taken from the complainant and he has never intended to retain the money with him. This is another matter that the respondent has not been able to arrange for and refund the amount to the complainant. But the intention of the respondent to refund the amount is apparent from these letters". I cannot endorse this view. This is not a proper approach. This is taking the probable defence of the accused into account. This is equating the complaint with a criminal trial. The magistrate has to act on the material before him at the time of issuing process without considering any possible defence. The accused will have an opportunity to have his defence considered after the process has been issued and he appears in pursuance of that process. (B. C. Khatri v. Peshuram Chanduram Sindhi, AIR 1968 Bom 39 : (1968 Cri LJ 27)).
7. It is not necessary or possible in every case to prove in what precise manner the accused person has dealt with or appropriated the money of the principal. The question is one of intention and not a matter of direct proof. But refusing to pay an admitted amount received by a person in the capacity of an agent is a strong circumstance against the accused person. In the case of an agent charged with misappropriating the money of the principal the elements of criminal offence of misappropriation will prima facie be established if the complainant shows that the agent received the amount, that he was under a duty to account to the principal, and has not done so. If the failure to account was due to facts within the agent's knowledge it is for him to explain. It is not the law of this country that the prosecution has to eliminate possible defences or circumstances which may exonerate the accused. If these facts are within his knowledge he had to prove them. All that the prosecution has to established is a prima facie case in the first instance. This has been authoritatively settled by the Supreme Court in Krishan Kumar v. Union of India, AIR 1959 SC 1390 (1393) : (1959 Cri LJ 1508 at pp. 1510, 1511). A decision of Fazal Ali, J., in Harakrishna Mahatab v. Emperor, AIR 1930 Pat 209 : (1930-31 Cri LJ 249) was approvingly referred to as laying down the correct law.
8. It is true that a court of justice "cannot reach the conclusion that the crime has been committed unless it be a just result of the evidence that the accused in what was done or omitted by him was moved by the guilty mind". (Lanier v. Rex (1914) AC 221). But evidence will be adduced at the trial when in answer to the process the accused appears and gives his defence. It is in the accused's power the produce evidence of an honest intention. If a matter be within the knowledge of the accused and unknown to the prosecution the onus of proof is cast upon the former. As was said in a Lahore case; proof of receipt and failure to account "is a long way towards proof of misappropriation but not the whole way" (Ghulam Haider v. Emperor, AIR 1938 Lah 634 : (1938-39 Cri LJ 851)). In another case it was said that it is only on proof of non-payment of money received by the accused that "presumption will arise of misappropriation" (Bhikchand v. Emperor, AIR 1934 Sind 22 : (1935-36 Cri LJ 818)). If it is shows that the money entrusted to the accused for a particular purpose was not returned by him in accordance with his duty, it lay on him to prove the defence. That his conduct was honest is for the accused to show. This important principle was overlooked in this case. The principle of presumption and burden was not kept in judicial view.
9. Sections 203 and 204, Criminal P.C. confer a discretion on the Magistrate to determine whether he should dismiss the complaint or proceed with it. The expression 'sufficient ground' used in Section 204 Cr.P.C. means that a prima facie case has been made out against the accused. The test is whether there was sufficient ground for proceeding and not whether there was sufficient ground for conviction. Where there is prima facie evidence, even though the person charged of the offence in the complaint might have a defence the matter has to be proceeded with and the issue of process cannot be refused on that ground (Nirmaljit v. State of W.B., AIR 1972 SC 2639, see also Mahabir Prasad v. Mohinder Kumar Vallabhgi, 1981 Chand LR (Cri) 241 (Delhi)).
10. I think the complaint discloses an offence under S. 409 IPC and the petitioner has made out a case for issue of process. The accused ought to have been summoned on the allegations of the complainant, supported as he is by the letters written by the respondent himself. At the initial stage the court is not to see whether there is sufficient ground for conviction of the accused or whether the trial is sure to end in his conviction.
11. It seems to me there was sufficient evidence before the magistrate which made out a prima facie case against the accused. Whatever may be said in favour of the accused it was certainly not a case of refusal of process. The scheme of Section 203 suggests that the inquiry envisaged there is for the purpose of ascertaining the truth or false-hood of the complaint, that is, for ascertaining whether there is evidence in support of the complainant so as to justify the issue of process. The statute does not say that a regular trial adjudging the truth or otherwise of the person complained against should take place at that stage, for such a person can be called upon to answer the accusation made against him only when a process has been issued and he is on trial.
12. Section 203 is in two parts. The first part lays down the material which the magistrate must consider. The Section part says that if after considering the material there is, in his judgment no sufficient ground for proceeding, he may dismiss the complaint. Now the supreme court has laid down the test. The test is whether there is sufficient ground for proceeding and not whether there is sufficient ground for conviction. Where there is prima facie evidence, even though a person charged of an offence in the complaint might have a defence, the matter has to be decided by the appropriate forum at the appropriate stage and issue of process cannot be refused. Unless therefore the magistrate finds that the evidence led before him is self-contradictory or intrinsically untrustworthy, process cannot be refused if that evidence makes out a prima facie case. (See Chandra Deo v. Prokash Chandra. AIR 1963 SC 1430 : (1963 (2) Cri LJ 397). Applying this test I must hold that the impugned order of dismissal is not justified.
13. For these reasons the revision petition is accepted. The case is remitted to the learned magistrate to issue process and try the complaint in accordance with law.