JETHSUR SURANGBHAI versus STATE OF GUJARAT

Citation: [1984] 1 S.C.R. 797 · Decided: 09-11-1983 · Supreme Court of India · Bench: S. MURTAZA FAZAL ALI, R.B. MISRA, M.P. THAKKAR · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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JETHSUR SURANGBHAI
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v.
STATE OF .GUJARAT
November 9, 1983
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[S. MURTAZA FAZAL ALI, R.B. MISRA AND M.P. THAKKAR, JJ.I
Indian Penal Code_ 1"860, Ss. 120 B, 109, 408, 467 and 471.
Chairman of Cf!-operative Society along with
ot~ers charged with
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conspiracy to commit criminal breach· of trust-Charge of conspiracy having
• failed-Sessions Court acquitting alt ·but one accused-Appeal by State-High
Court convicting Chairman-Conviction whether valid and legal.
Defalcation of properties-several accused charfied'. with conspiracy-
Prosecution to prove collusion and cohesion timong all occ~sed-Mens rca not to
be excluded-If charge of conspiracy fa·us~Prosecution to prove affirn1at~ve/y that
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accused direCtly and persOna!ly Connected with acts or onlissions.
·The appellant was the Chairman_ofan autollo1nous cooperative society
under the control and supCrvision of the State Government. On receipt of com-
plaints about the financial manag~ment of the Society, th~ Registrar. of
Cooperative Societies appointed a special auditor . to audit the Society's
accounts. On the basis of the audit report a charge-sheet was filed against all
the a~Cused for enterin·g into a conSpiracy to co1nmit criminal breach of· trus·t~
The conspiracy charge having failed, al1 the accused except one were acquitted
by the Sessions Judge.
On ~ppeal by the· State, the High Court convicted the appellant in
respeCt of three items, namely, purchase of fertilisers in,volving two transaCtions
and missing of certain oil engines, On the ground that as Chairn1an of the
Managing Committee he must be held to be vicariously- liable for 8ny order
given or miSappropriation committed by t.he other accused .
• Jn appeal to this Court it wa~ contended on behalf of the· appellant that
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no case of defalcation had been made out against the apPe,llant.
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Allowing the appeal,
HELD: 1: ·The:re was no justification for the High COurt to iiiterfere
.with the appeilant's acquittal.. The.case ag'ainSt -the appellant had not been
proved beyond ·reasonable doubt and .he Was
~rongty· convicted by the High
Court. (802 D-EJ
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798
SUPREME COURT REPORTS
• (1984) I s.c.ll..
2. In a case Whei-c there was serious defalCation Of the properties,
unlefs the pr_osecution proved that. there was a _close cohesio_n and collusion
between all the accu.sed which formed the
~ubject matter of a conspiracy,"·it
would be difficult to proVe the charges against the appellant. ·The Charge of
. conspiracy havins fRifod, the most material and integral° patt of the proSecution
story· against the ·appellant disappeared. .1801 B·CJ
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3. In a criininaJ·case of such serious nature mens rea cannot be excluded. ·~ ·
o·ace the charge of conspiracy has failed the onus· lay on the prosecution to
pfoVe affirmatively that the appellant waS directly and personally. connected
.with a·cts ·or omissions Pertaining to the items purchas~d. [80_1 EJ
4. In the absence of a. cl.1arg~ Or conspiracy the mcr:e fact that the
appellaii.t happened to be the Chairman Of the CommiUec would not niake. him
liable.in a vi.carious· sense. ·There is· no evidenCe either djrect or :circu1ns1aniial
·to show that apart from approving the puichase of rertilisefs he. knew. tha~ the
fii;-mS from which the. fertilisers werc.pµrchased did nOt exist. lf the Chairman ,,.
was io be made liable then all members of the Commiltee, viz.· Tehsildar and,
oth"ei" nominated mem)?ers would be equ·ally ,liable· because all of them par·ticipa-
ted in the delibel'.ation of the. meetings of the Committee. The. apj)ellant as
Chairffian Of the Sangl;, had to deal with ~ -Jarge variety of m;ltters ·;:and fr
woi.ild not be humanly possible for hirri tO analyse and ·go in.to the details or
every srnall m:itter in order to find out whether· there haS been any criminal
breach of trust .. 1801 0-H;.802 A-BJ
Cw.nNAL APPBLL'TB JURISDICTION:, Criminal Appeal Np. 260
of .1972.
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Appeal by Special leave from the Jud·gment and Order dated
the 22.3.1972 of the Gujarat High Court in Criminal Appeal No. 171
of 1971.
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R.L. Kohli, Ramesh Koh Ii, Naresh K. Shanna and. Vineet Kumar
forthe App.ellant.
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M. N; 'Phadke,
Reipondent ..
H. R., Khpnna and R. N. 'Poddar for the
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The Judgment of t~e Court was delivered by
FAzAL Au, J.. After hearing counsel for the parties, by virtue
of our Order· dated October 4, 1983, we had allowe

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