Case Note & Summary
The appeals arose from two complaints filed by the Charity Commissioner, State of Gujarat under Section 35(1) read with Section 66 of the Bombay Public Trust Act, 1950 against ten accused persons who were alleged to be trustees of two trusts, Shree Swaminarayan Mandir and Narayan Mandir. The first accused was the Acharya, the tenth was said to be the Mahant, and the others associated trustees appointed under schemes framed by the High Court of Bombay. The complaints alleged that the first accused withdrew sums of Rs. 30,277.53 and Rs. 40,653.56 from trust funds in Samvat years 2014 and 2015 to meet his personal income-tax liabilities, and that these amounts were reimbursed only in Samvat year 2018. The other accused were alleged to have connived at these contraventions. The trial court convicted all accused, but the Gujarat High Court acquitted them, holding that accused 2 to 10 were not proved to be trustees at the time of the alleged offence and that mens rea was not proved against the first accused. The State of Gujarat and the Charity Commissioner obtained special leave to appeal to the Supreme Court. The Supreme Court first examined the evidence against accused 2 to 10 and found that there was absolutely no evidence that they were trustees during the relevant Samvat years or that they had any knowledge of the withdrawals. The only witness examined on behalf of the complainant, the Legal Advisor of the Charity Commissioner, did not give any evidence against them. Regarding accused No.1, the Court noted his defence that he withdrew amounts from his private Hathu Khata, a khata built up by him and his ancestors, and there was no contra evidence. The prosecution witness admitted that accused No.1 had kept a huge sum with the trust without interest. The original letter allegedly sent by accused No.1 to the Charity Commissioner was not produced; only an alleged copy was placed on record without proof. The Court also held that the statement of accused No.1 under Section 342 Cr.P.C. could not be split into parts to accept a portion and reject the rest; it had to be accepted as a whole or not relied upon at all. Taken as a whole, the statement did not show guilt. On the legal question whether mens rea is a necessary ingredient of Section 35(1), the Supreme Court observed that offences created by statute are generally presumed to require mens rea unless excluded by express language or necessary implication. However, regulatory provisions enacted in public interest, such as those safeguarding trust funds, may impose strict liability. The Court referred to Lim Chin Aik v. The Queen and Sherras v. De Rutzen to identify exceptions, including acts which are not criminal in any real sense but are prohibited under a penalty in the public interest. It held that Section 35(1) of the Bombay Public Trust Act, 1950 creates a quasi-criminal regulatory offence, is punishable only with fine, carries no stigma, and its language appears to make contravention an absolute liability. Therefore, mens rea cannot be read into it. Despite this finding, the Court affirmed the acquittals because the prosecution failed to prove the factual ingredients of the offence. The Supreme Court dismissed all appeals.
Headnote
A) Criminal Law - Mens Rea - Strict Liability Offences - Bombay Public Trust Act, 1950, Sections 35(1) and 66 - The court examined whether mens rea is a necessary ingredient of the offence under Section 35(1). It held that statutory offences generally require mens rea unless excluded expressly or by necessary implication, but regulatory provisions enacted in public interest for safeguarding trust funds may impose strict liability. Section 35(1) creates a quasi-criminal regulatory offence, punishable only with fine and carrying no stigma; its language appears to make contravention an absolute liability. Therefore, mens rea cannot be read into it. Held that mens rea is not a necessary ingredient of Section 35(1). B) Criminal Procedure - Statement of Accused under Section 342 CrPC - Evidentiary Use - Code of Criminal Procedure, 1898, Section 342 - The court held that the statement of an accused under Section 342 CrPC must be accepted as a whole or not relied upon at all; it cannot be split to accept inculpatory parts and reject exculpatory ones. In this case, accused No.1's statement taken as a whole did not show guilt. Held that the prosecution could not rely on selected portions of the statement. C) Evidence - Proof of Trusteeship and Knowledge - Bombay Public Trust Act, 1950, Sections 35(1) and 66 - The court found no evidence that accused 2 to 10 were trustees during the relevant Samvat years or that they had knowledge of the unauthorised withdrawals. The sole prosecution witness gave no evidence against them. Held that the case against accused 2 to 10 failed for lack of proof. D) Evidence - Proof of Misapplication of Trust Funds - Bombay Public Trust Act, 1950, Section 35(1) - The prosecution alleged that accused No.1 withdrew trust money for personal income-tax liability. Accused No.1 claimed withdrawals were from his private Hathu Khata, and there was no contra evidence; the prosecution witness admitted accused No.1 had kept a large sum with the trust without interest. The original letter allegedly sent by accused was not proved. Held that the prosecution failed to prove unauthorised withdrawal from trust funds.
Issue of Consideration
Whether mens rea is a necessary ingredient of the offence under Section 35(1) of the Bombay Public Trust Act, 1950; whether accused 2 to 10 were trustees at the relevant time and had knowledge of the withdrawals; whether prosecution proved that accused No.1 withdrew trust money as opposed to funds from his private Hathu Khata; whether statement under Section 342 CrPC can be split to infer guilt
Final Decision
The Supreme Court dismissed the appeals and affirmed the High Court acquittal. It held that no evidence was led against accused 2 to 10 to prove trusteeship or knowledge, and the case against them failed. Regarding accused No.1, the prosecution failed to prove that the withdrawn amounts belonged to the trust; his statement under Section 342 CrPC had to be accepted as a whole and did not establish guilt. On the legal question, the Court held that mens rea is not a necessary ingredient of Section 35(1) of the Bombay Public Trust Act, 1950, as it creates a quasi-criminal regulatory offence punishable only with fine and enacted to safeguard public interest in trust money. However, despite the absence of mens rea requirement, the prosecution still failed to prove the factual ingredients of the offence.
Law Points
- mens rea presumption in statutory offences
- strict liability for regulatory offences enacted in public interest
- quasi-criminal offence punishable only with fine does not carry stigma
- statement under Section 342 CrPC must be accepted as whole
- prosecution must prove accused was trustee and trust money misapplied even in strict liability offences
