Immovable Property Can Be Subject Matter Of Offence Of Criminal Breach Of Trust U/s 405 IPC: Kerala HC [Read Order]

In Damodara Panicker vs. State of Kerala, one of the offences alleged against the accused is criminal breach of trust i.e. under Section 405 I.P.C. and the subject matter of the offence is an immovable property. One of the issue raised in the petition filed under Section 482 CrPC before the High Court was whether immovable property can be the subject matter of an offence of criminal breach of trust which is defined under Section 405 I.P.C.

Referring to the IPC provisions, Justice R. Narayana Pisharadi observed that the operation of Section 405 is not restricted to 'movable property'. The court said:

"If the legislature had intended to restrict the operation of Section 405 I.P.C to movable property, there is no reason why the general word 'property' is used in that provision without the qualifying word 'movable'. In this context, it is pertinent to note that the operation of many other provisions in the Indian Penal Code (for example, Sections 378 and 403) is expressly restricted to 'movable property'. Therefore, there is no reason to find that the expression ''property'' used in Section 405 I.P.C refers to movable property only."

The court thus concluded that the offence of criminal breach of trust, which is defined under Section 405 I.P.C, is capable of being committed in respect of immovable property.

"The operation of Section 405 I.P.C is not restricted to movable property. Entrustment of immovable property or dominion over such property can be made upon a person. Conversion, use or disposal of such property, in violation of the terms of such entrustment, can be committed by the person to whom the entrustment is made. In other words, immovable property can be the subject matter of the acts covered by Section 405 I.P.C"

Must necessarily be the property of some person other than the accused

Taking note of the facts of the case, the bench also observed that the property in respect of which criminal breach of trust can be committed must necessarily be the property of some person other than the accused or the beneficial interest in or ownership of it must be in other person and the offender must hold such property in trust for such other person or for his benefit. It said:

"The expression 'entrusted with property' or 'with any dominion over property' has been used in a wide sense in Section 405 I.P.C. The expression 'entrusted' appearing in Section 405 I.P.C is not necessarily a term of law. It has wide and different implications in different contexts. The property in respect of which criminal breach of trust can be committed must necessarily be the property of some person other than the accused or the beneficial interest in or ownership of it must be in other person and the offender must hold such property in trust for such other person or for his benefit."

"True, entrustment of property as envisaged in Section 405 I.P.C need not be in any particular manner. The entrustment may arise in "any manner'' whatsoever. The words 'in any manner' in the context are significant. The section does not provide that the entrustment of the property with the accused shall be made by some person. As long as the accused is given possession of property for a specific purpose or to deal with it in a particular manner, the ownership being in some person other than the accused, he can be said to be entrusted with that property to be applied in accordance with the terms of entrustment and for the benefit of the owner.

Mere existence of that person's dominion over property is not enough

The court observed that in order to establish "entrustment or dominion" over property to an accused person the mere existence of that person's dominion over property is not enough.

"It must be further shown that his dominion was the result of entrustment (See Velji Raghavji Patel v. State of Maharashtra : AIR 1965 SC 1433). The term "entrusted" in Section 405 I.P.C governs not only the word "with the property" immediately following it but also the words "or with any dominion over the property" occurring thereafter (See State of Gujarat v. Jaswantlal Nathalal : AIR 1968 SC 700)."

The court said, in the present complaint, there is no averment regarding entrustment of property or dominion over the property in question with the first petitioner in any manner, one of the basic ingredients of the offence of criminal breach of trust is not made out against him.

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