Case Note & Summary
The case involved a criminal appeal concerning allegations of criminal breach of trust under Section 406 of the Indian Penal Code against the Managing Director of Britannia Industries Limited. The dealership of M/s. Akash Traders was terminated, and the complainant sent demand drafts for goods despite the termination. The Chief Judicial Magistrate discharged the accused, stating there was no intention of criminal misappropriation. A revision application by the complainant was allowed, leading to the appeal. The Supreme Court considered whether the complaint disclosed an offence against the appellant. It noted that the drafts were issued in the company's name, and the company was not made an accused. The court emphasized that vicarious liability was not applicable as there was no statutory provision for it under Section 406 IPC. The court found that the High Court erred in its judgment and set aside the impugned order, allowing the appeal and awarding costs to the appellant for harassment caused by the complainant.
Headnote
A) Criminal Law - Criminal Breach of Trust - Ingredients of Offence - Indian Penal Code, 1860, Section 406 - The court examined whether the appellant, as Managing Director, could be held liable for criminal breach of trust when the demand drafts were issued in the company's name and the company was not made an accused. It was held that the appellant could not be vicariously liable for the company's actions as there was no statutory provision for such liability under Section 406 IPC (Paras 13-20). B) Criminal Procedure - Discharge of Accused - Code of Criminal Procedure, 1973, Section 245(2) - The court analyzed the discharge of the accused by the Chief Judicial Magistrate and the subsequent revision application. It was determined that the complainant was not given an opportunity to present evidence, leading to a flawed discharge order, which was subsequently overturned (Paras 11-12).
Issue of Consideration
Whether the complaint petition disclosed an offence under Section 406 of the Indian Penal Code against the appellant.
Final Decision
The Supreme Court set aside the High Court's judgment, allowing the appeal and ruling that the appellant could not be held liable under Section 406 IPC. The court awarded costs of Rs. 1,00,000 to the appellant for harassment caused by the complainant.
Law Points
- Criminal breach of trust
- Vicarious liability
- Section 406 IPC
- Section 245(2) CrPC
- Juristic person liability
