RAMASWAMY NADAR versus THE STATE OF MADRAS

Citation: [1958] 1 S.C.R. 739 · Decided: 11-10-1957 · Supreme Court of India · Bench: BHUVNESHWAR PRASAD SINHA · Disposal: Appeal(s) allowed

Judgment (excerpt)

S.C.R. 
SUPREME COURT REPORTS 
RAMASWAMY NADAR 
v. 
THE STATE OF MADRAS 
( B. P. SINHA, P. GoVINDA MENON and 
J. L. KAPu:R, JJ.) 
739 
Criminal law-Misappropriation-Prize Competition-
Entry fees-No rule th0;t amount ?f fees should ?e re~erved 
for payment to prize winners-Failure to pay prize winners 
-Whether dishvnest misappropriation-Reversal of order 
of Acquittal-Conviction for a different offence-Legality-
Indian Penal Code (Act XLV of 1860), ss. 403, 420-Code of 
Criminal Procedure (Act V of 1898), s. 423 (1) (a) (b). 
The appellant, who used to carry on the business of con-
ducting prize competitions, was prosecuted on a charge 
under s. 420 of the Indian Penal Code. The case against him 
wu that though he found that his competitions did not 
attract a sufficiently large number of competitors to yield 
the guaranteed prize money, he advertised the competition 
in question and collected a large a,!!}OUnt by way of entry 
fees with a dishonest intention, and did not utilize any part 
of the collected amount towards payment of the prizes 
offered. The Magistrate found that there was no evidence 
that the accused had used any part of the entry fees col-
lected in any of the competitions for his own use but that, 
on the other hand, in order to meet the heavy-demands of 
the prize winners in respect of the previous competitions, 
the accused had spent not only the amounts collected by 
him but also a large amount of money of his own capital. 
He accordingly came to the conclusion that though the 
accused had been utterly reckless and irresponsible in his 
conduct of the competitions and thereby caused loss to cer-
tain persons, he had not been guilty of any fraudulent or 
dishonest conduct and so could not impute any criminal 
liability to him. The High Court agreed with the Magis-
trate in acquitting the appellant of the charge under s. 420 
of the Indian Penal Code but held that, though the appel-
lant did not have any dishonest intention in the initial 
stages, there was no justification for not having disbursed 
the amount of money collected·in respect of the competition 
in question pro rata amongst the declared priz~ winners, 
and convicted him of misappropriation under s. 403, Indian 
Penal Code. On appeal to the Supreme Court it was con-
tended for the appellant that (1) the High Court was not 
authorized by s. 423(1) (a) of the Code of Criminal Proce-
dure to convert an order of acqµittal into an order of con-
viction in respect of an offence other than that for which 
the accused was tried by the trial Court, and (2) on the 
facts and circumstances of the case no offence under s. 403, 
Indian Penal Code, had been made out. 
1957 
October 11/21. 
740 
SUPREME COURT REPORTS 
[1958] 
1957 
He!d: (1) that under ,s. 423 (1) (a) of the Code of Crimi-
R 
-
N. a. 
nal Procedure the High Court has, in an appeal from an 
amaswa;:y a ar order of acquittal, the power to reverse the order and find 
The Stare of 
the accused guilty of the offence disclosed by the evidenoe. 
Madras 
Sinha J. 
(2) that in view. of the fact that there was no express 
provision in the rules and conditions of the competition In 
question that the money collected by way of entry fees 
should be reserved for payment to the prize winners in that 
very competition, the appellant could not be held guilty 
of misappropriation under s. 403 of the Indian Penal 
Code. 
CRIMINAL 
APPELLATE 
JURISDICTION: 
Crimfual 
Appeal No. 153 of 1957. 
Appeal by special leave from the judgment and 
order dated the 3rd April, 1957, of the Madras High 
Court in Criminal Appeal No. 393 of 1956 arising out 
of the judgment and order dated the 10th February, 
1956, of the Court of the Fourth Presidency Magis-
trate, G. T. Madras in C. C. No. 10027 of 1955. 
H. J. Umrigar, R. Ganapathy Iyer and G. Gopa!a-
krishnan, for the appellant. 
P. Rama Reddy and T. M. Sen, for the respondent. 
1957. October 11/21. The following Judgment of 
the Court was delivered by 
SINHA J.-This appeal by special leave is directed 
against the judgment and order of a Single Judge of 
the Madras High Court, dated April 3, 1957, setting 
aside the order of acquittal passed by the fourth 
Presidency Magistrate at Madras, dated February 10, 
1956, on a charge under s. 420, Indian Penal Code. 
The Government of Madras appealed against the order 
of acquittal and the appeal was heard by a Single 
Judge of that Court The learned Judge allowed the 
appeal, but did not convict the appellant under s. 

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