Of criminal breach of trust
Criminal breach of trust.
- (1) Whoever, being in any manner entrusted with property, or with any dominion
over property, dishonestly misappropriates or converts to his own use that property, or
dishonestly uses or disposes of that property in violation of any direction of law prescribing
the mode in which such trust is to be discharged, or of any legal contract, express or implied,
which he has made touching the discharge of such trust, or wilfully suffers any other person
so to do, commits criminal breach of trust.
Explanation 1.—A person, being an employer of an establishment whether
exempted under section 17 of the Employees’ Provident Funds and Miscellaneous
Provisions Act, 1952 or not who deducts the employee’s contribution from the wages payable
to the employee for credit to a Provident Fund or Family Pension Fund established by any
law for the time being in force, shall be deemed to have been entrusted with the amount of the
contribution so deducted by him and if he makes default in the payment of such contribution
to the said Fund in violation of the said law, shall be deemed to have dishonestly used the
amount of the said contribution in violation of a direction of law as aforesaid.
Explanation 2.—A person, being an employer, who deducts the employees’
contribution from the wages payable to the employee for credit to the Employees’ State
Insurance Fund held and administered by the Employees’ State Insurance Corporation
established under the Employees’ State Insurance Act, 1948 shall be deemed to have been
entrusted with the amount of the contribution so deducted by him and if he makes default in
the payment of such contribution to the said Fund in violation of the said Act, shall be
deemed to have dishonestly used the amount of the said contribution in violation of a
direction of law as aforesaid.
Illustrations.
(a) A, being executor to the will of a deceased person, dishonestly disobeys the law
which directs him to divide the effects according to the will, and appropriates them to his
own use. A has committed criminal breach of trust.
(b) A is a warehouse-keeper Z going on a journey, entrusts his furniture to A, under a
contract that it shall be returned on payment of a stipulated sum for warehouse room. A
dishonestly sells the goods. A has committed criminal breach of trust.
(c) A, residing in Kolkata, is agent for Z, residing at Delhi. There is an express or implied
contract between A and Z, that all sums remitted by Z to A shall be invested by A, according
to Z’s direction. Z remits one lakh of rupees to A, with directions toA to invest the same in
Company’s paper. A dishonestly disobeys the directions and employs the money in his own
business. A has committed criminal breach of trust.
(d) But if A, in illustration (c), not dishonestly but in good faith, believing that it will be
more for Z’s advantage to hold shares in the Bank of Bengal, disobeys Z’s directions, and
buys shares in the Bank of Bengal, for Z, instead of buying Company’s paper, here,
though Z should suffer loss, and should be entitled to bring a civil action against A, on
account of that loss, yet A, not having acted dishonestly, has not committed criminal
breach of trust.
(e) A, a revenue-officer, is entrusted with public money and is either directed by law, or
bound by a contract, express or implied, with the Government, to pay into a certain treasury
all the public money which he holds. A dishonestly appropriates the money. A has committed
criminal breach of trust.
(f) A, a carrier, is entrusted by Z with property to be carried by land or by water. A
dishonestly misappropriates the property. A has committed criminal breach of trust.
(2) Whoever commits criminal breach of trust shall be punished with imprisonment of
either description for a term which may extend to five years, or with fine, or with both.
(3) Whoever, being entrusted with property as a carrier, wharfinger or
warehouse-keeper, commits criminal breach of trust in respect of such property, shall be
punished with imprisonment of either description for a term which may extend to seven
years, and shall also be liable to fine.
(4) Whoever, being a clerk or servant or employed as a clerk or servant, and being in
any manner entrusted in such capacity with property, or with any dominion over property,
commits criminal breach of trust in respect of that property, shall be punished with
imprisonment of either description for a term which may extend to seven years, and shall also
be liable to fine.
(5) Whoever, being in any manner entrusted with property, or with any dominion over
property in his capacity of a public servant or in the way of his business as a banker,
merchant, factor, broker, attorney or agent commits criminal breach of trust in respect of that
property, shall be punished with imprisonment for life, or with imprisonment of either
description for a term which may extend to ten years, and shall also be liable to fine.