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PETITIONER: AMRITLAL RATILAL MEHTA & ANR.

       Vs.

RESPONDENT: STATE OF GUJARAT

DATE OF JUDGMENT16/11/1979

BENCH: REDDY, O. CHINNAPPA (J) BENCH: REDDY, O. CHINNAPPA (J) SARKARIA, RANJIT SINGH

CITATION:  1980 AIR  301            1980 SCR  (2)  72  1980 SCC  (1) 121

ACT:      Indian Penal  Code 1860 (Act 45 of 1860) Ss 34, 420 and 477-A-Accused charged  under section  420/34 &  section 477- A/34-Acquittal  on   charge  under   section  477-In  appeal confirmed-Acquittal  on  charge  under  section  480-Whether follows.      Criminal Trial-Finding of fact finally determined at an earlier stage  of case-At  later  stages-Binding  force  and conclusive nature of such finding.

HEADNOTE:      The prosecution  alleged that  the appellants (accused) who were  employees of a private company, willfully and with an intention  to defraud the Central Excise Department, made false declaration  in gate  passes which  were  prepared  by Appellant No.  1 and  signed by  Appellant  No.  2,  secured clearance of  dutiable  goods  without  payment  of  Central Excise Duty, and thereby caused wrongful loss to the Central Excise Department.  They were  therefore charged with having committed offences  punishable under  sections 420 read with section 34  I.P.C. and  section 477-A  read with  section 34 I.P.C.      The Magistrate who tried the case found that neither of the accused  intended to  cheat and  make wrongful  gain but that they  made a false entry in the gate passes with a view to help  their employers,  and acquitted both of them of the charge under  section 420  read with  section 34  I.P.C. but convicted them  under section  477-A read  with  section  34 I.P.C. and sentenced them to pay fines.      In the  appellants’ appeal,  the Sessions  Judge  found that the  gate passes  were prepared  by the accused under a mistake, that  the worst that could be said against them was that  they  acted  inadvertently  or  negligently  that  the expression "intent  to  defraud"  denoted  some  element  of dishonesty and  that the  appellants  having  acted  neither willfully  not   with  intent  to  defraud  the  Government, acquitted them  of the  charge under section 477-A read with section 34.      The State  filed two  appeals in  the High  Court,  one against the  order of  acquittal recorded  by  the  Sessions Judge on the charge under section 477-A read with section 34 I.P.C., and  the  other,  against  the  order  of  acquittal

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recorded by  the Magistrate  on the charge under section 420 read with  section 34 I.P.C. The former appeal was dismissed summarily by  a Division Bench, while the latter was allowed by a  Single Judge who imposed a sentence of fine. The Judge was of  the view  that the  acquittal of  the  charge  under section 477-A  was not  a bar  to a conviction under section 420 as  the ingredients  of the two offences were different, and that  the gist  of the  offence under  section 477-A was that the  false entries  must have  been made  willfully and with intent  to defraud  whereas the  essence of the offence under section  420 was  that the  accused should  have acted dishonestly. 73      In the appeal, to this Court it was contended on behalf of the  appellants that the findings of fact recorded by the Sessions Judge  on the  charge under section 477-A read with section 34  I.P.C. having  become final  as a  result of the dismissal of  the appeal  by the  Division Bench, the charge under  section   420  read  with  section  34  I.P.C.  would automatically fail.      Allowing the appeal, ^      HELD: 1.  The question  about the  binding force  of  a finding at  an earlier stage would depend on the question as to what  the  allegations  were  and  what  were  the  facts required to be proved and what findings were arrived at. The question is  not whether the ingredients of the two offences are the same but whether the fact alleged and required to be proved in  the particular case to establish the offences are basically the same. [76 A-B]      Bhagat Ram  v. State  of Rajasthan [1972] 2 S.C.C. 466; State of  Rajasthan v.  Tarachand Jain  [1974] 3  S.C.C.  72 referred to.      In the  instant case the charges against the appellants showed that  the  essential  allegation  to  be  proved  was whether the  gate passes  were made  ’dishonestly’ so far as section 420  was concerned  and "with  intent to defraud" so far as  the charge  under section  477-A  was  concerned.  A finding that  the gate  passes were  made inadvertently  and negligently was destructive of both the charges.[76 C]      2. If for the purpose of the offence under section 477- A, the  court found  that the entries made by the accused in the gate  passes were made inadvertently and negligently but not willfully or with a view to defraud and that finding had become final,  it would  not be  open to the court, later to find, on the charge under section 420, that the entry on the gate passes  was made not inadvertently and negligently, but dishonestly. [76 D]      3. The  acquittal of  the accused  having become final, must operate  for the  benefit of  the accused  and lead  to their acquittal on the charge under section 420 also. [76 E]

JUDGMENT:      CRIMINAL APPELLATE  JURISDICTION :  Criminal Appeal No. 222 of 1973.      Appeal by  Special Leave  from the  Judgment and  Order dated 27/28-2-73  of the  Gujarat  High  Court  in  Criminal Appeal No. 731/71.      Frank Anthony and K.L. Hathi for the Appellant.      R.H. Dhebar,  Miss Pratiloha Pandit and M.N. Shroff for the Respondent.      The Judgment of the Court was delivered by      CHINNAPPA REDDY, J. To appreciate the question posed in

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the present  appeal, it  is necessary to set out in full the two charges  framed against the two appellants. They were as follows:-      "I, Chandrakant  T.  Mashla,  Judicial  Magistrate  2nd Court, Baroda hereby charge you           (1)  Amritlal Ratilal Mehta 74           (2)   Gajanan Bhikhabhai  Gandhi both of Baroda as                follows:-      That both  of you  Amritlal Ratilal  Mehta and  Gajanan Bhikhabhai Gandhi  on or  about 21-12-65,  at Baroda cheated the Central  Excise Department,  Baroda  in  furtherance  of common intention  to cheat  the Government of excise duty of Rs. 11450/-  (Eleven thousand  four hundred  and  fifty)  by dishonestly making  false declaration in gate passes numbers 105, 104,  103, all  dated 21-12-65  which were prepared and written by accused No. 1 and signed by accused No. 2 stating therein: "Repaired  Motor  with  our  replacing  statore  or Rotor" and  thereby dishonestly  induced the  Central Excise Inspector to  allow the  clearance of  Electric  Motor  Nos. 614193,  614194,  614196  respectively  without  payment  of Central Excise  duty on  the dutiable  parts  namely  Rotors Numbers 41-40-42 which were manufactured by M/s. Joyto Ltd., Company Baroda  and were replaced by the said company in the above Electric  Motors and  thereby got the clearance of the above Electric  Motors without  payment  of  Central  Excise Duty, causing  thereby wrongful  loss of  Rs 11450/-  to the Central Excise  department and thereby both of you committed offence punishable u/s. 420 read with s. 34 of I.P.C. within cognizance of J.M.F.C., Baroda.           And also  that both  of you at about the same time      and place  in furtherance  of common  intention in your      capacity  is   employees  of  M/s.  Joyto  Ltd.  Baroda      willfully and  with an intention to defraud the Central      Excise Department,  Baroda made  false entries  in  the      gate  passes  as  mentioned  above  belonging  to  your      employer and  thereby committed  an offence  punishable      u/s 477-A, r/w. Section 34 I.P.C. and within cognizance      J.M.F.C., Baroda.  And thereby  direct that you both be      tried for  the above  offences by  2nd Court, J.M.F.C.,      Baroda."      The learned Judicial First Class Magistrate, Baroda who tried the  case acquitted  both the  accused of  the  charge under s. 420 read with s. 34 I.P.S. but convicted them under s. 477A  read with  s. 34  I.P.C. and  sentenced them to pay fines of  Rs. 100/-  and Rs. 500/- respectively. The learned Magistrate was  of the  view that  neither  of  the  accused intended to  cheat and make wrongful gain but that they made a false  entry in  the gate passes with a view to help their employer. The  two accused  preferred an appeal to the Extra Additional Sessions  Judge,  Baroda.  The  learned  Sessions Judge acquitted them of the charges under s. 477-A read with s. 34 I.P.C. also. The learned Sessions Judge found that the gate passes were prepared by the accused under a mistake and that the worst that could be said against the two 75 accused was  that they  acted inadvertently  or negligently. The learned Sessions Judge took the view that the expression "intend to  defraud" denoted  some element of dishonesty and that the  appellants acted  neither willfully  nor with  the intent to defraud the Government. The State of Gujarat filed two appeals,  the  first  against  the  order  of  acquittal recorded by  the learned  Judicial First  Class  Magistrate, Baroda on  the charge  under s.  420 read with s. 34 I.P.C., and the  second against  the order  of acquittal recorded by

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the learned  Extra Additional  Sessions Judge, Baroda on the charge under  s. 477-A  read with  s. 34  I.P.C. The  appeal against the  order of acquittal on the charge under s. 477-A read with s. 34 I.P.C. was dismissed summarily on 13-3-72 by J.M. Sheth  and A.A.  Dave, JJ. The appeal against the order of acquittal  on the  charge under  s. 420  read with  s. 34 I.P.C. was  allowed on  27/28-2-73 by J.M. Sheth, J. and the two accused  were sentenced  to pay  fines of  Rs. 300/- and 500/- respectively.  It is  against this  judgment  of  J.M. Sheth, J.  that the  present appeal  has been  preferred  by special leave of this Court.      The principal submission of Shri Frank Anthony, learned counsel for  the appellants was that in view of the findings of fact  recorded by  the Sessions Judge on the charge under s. 477-A  read with s.34, which had become final as a result of the  dismissal of  the appeal by Sheth and Dave, JJ., the charge  under   s.  420   read  with   s.  34   I.P.C.  must automatically fail.  The learned  counsel submitted that the judgment of  the High  Court convicting the appellants under s. 420  read with  s. 34  I.P.C. was  patently wrong. We are inclined to agree with the submission of Shri Frank Anthony.      The learned  Judge of  the High  Court was  of the view that the  acquittal on  the charge  under s. 477-A was not a bar to  a conviction  under s. 420 as the ingredients of the two offences were different. According to the learned Judge, the gist  of the  offence under  s. 477-A was that the false entries must  have been  made willfully  and with  intent to defraud whereas  the essence of the offence under s. 420 was that the  accused should  have  acted  dishonestly.  We  are afraid that  the learned Judge entirely misdirected himself. The question  here is not whether the ingredients of the two offences are  the  same  or  substantially  the  same.  That question would  be relevant  if the  plea was  one autrefois acquit or autrefois convict. The question is not even one of ’issue  estoppel’  properly  so  called  as  there  were  no separate trials.  The question  really is  about the binding force and  the conclusive nature, at later stages of a case, of a  finding of fact finally determined at an earlier stage of the  case. The question is not res integra. In Bhagat Ram v. State of Rajasthan(1) and State of Rajasthan v. Tarachand 76 Jain(1) it  has been  held by this Court, an earlier finding which had  obtained finality  is binding  in the  subsequent proceedings in  the case.  The question  about  the  binding force of  a finding  at an earlier stage would depend on the question as  to what  the allegations  were, what facts were required to be proved and what findings were arrived at. The question thus  is not  whether the  ingredients of  the  two offences are  the same  but whether  the facts  alleged  and required to  be proved  in the  particular case to establish the offences  are basically the same. The charges set out by us at  the outset  show that  the essential allegation which was required  to be proved in respect of the two charges was whether the  gate passes  were made  ’dishonestly’ so far as the charge  under s.  420 was  concerned and ’with intent to defraud’ so  far as  the charge under 477-A was concerned. A finding that  the gate  passes were  made inadvertently  and negligently was  destructive of both the charges. If for the purpose of  the offence under s. 477-A, the Court found that the entries made by the accused in the gate passes were made inadvertently and  negligently but  not willfully  or with a view to  defraud and that finding became final, it would not be open  to the Court, later to find, on the charge under s. 420, that  the entries  on the  gate passes  were  made  not inadvertently and negligently, but dishonestly. On the facts

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of the present case, we hold that the finding of fact to the effect that  the gate  passes were  made  inadvertently  and negligently but  not willfully  or with  intent  to  defraud which led  to the  acquittal of  the accused  on the  charge under s.  477-A must,  that acquittal  having become  final, operate for  the benefits  of the  accused and lead to their acquittal on  the charge under s. 420 also. The finding that the gate  passes were made inadvertently and negligently, as we said,  was destructive  of the  charges under both s. 420 and  s.   477-A.  The   appeal  is  therefore  allowed.  The appellants  are   acquitted.  Their   bail  bonds   will  be cancelled. Fines if any will be refunded. N.V.K.                                        Appeal allowed 77