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PETITIONER: SARDAR SARDUL SINGH CAVEESHAR

       Vs.

RESPONDENT: STATE OF MAHARASHTRA(And Connected Appeals)

DATE OF JUDGMENT: 18/03/1963

BENCH:

ACT:  Evidence-conspiracy-Criminal  Breach of  trust-Meaning  and proof of conspiracy--Evidentiary value of Good character  of an accused in a criminal case-Indian Penal Code (Act XLV  of 1860),  ss. 120-B, 409, 109-Indian Evidence Act, 1872 (1  of 1872), ss. 10, 53, 55 Expl.

HEADNOTE: Double   Jeopardy-Applicability  of  rule-Law  finally   and authoritatively    decided   by   Supreme   Court   as    to interpretation of the constitution-If a substantial question of law-Constitution of India, Arta. 20 (2), 145 (3). After  the  discovery of the  conspiracy,  ten  conspirators including  the  appellants  were put  to  trial  before  the Sessions  judge under s. 120-B of the Indian Penal Code  and also  each one of them separately under s. 409 read with  s. 109  of the said Code.  The charge was that they,  alongwith one  Shankar  Lal and Doshi, both of them  deceased  entered into  a criminal conspiracy at Bombay and elsewhere  between or about the period from September 20, 1950 to December  31, 1950, to commit or cause to be committed criminal breach  of trust  in  respect  of  Government  securities  or  proceeds thereof  or the funds of the Empire of India Life  Assurance Co.  Ltd., Bombay, acquiring its management and control  and dominion  over the said property in the way of  business  as Directors,  Agents  or attorneys of the said  company.   The learned  Sessions Judge convicted six accused persons  under s.  120  B, read with s. 409 of the Indian  Penal  Code  and sentenced  them to various terms of imprisonment.  The  rest four accused persons were acquitted.  Against the  acquittal State  preferred  an  appeal  to  the  High  Court  and  the convicted  accused persons also filed appeals against  their convictions.   The.  Government appeal was allowed  and  the appeals  of the convicted accused persons were dismissed  by the  High Court.  These appeals by special leave  have  been preferred  only  by  five  accused  persons  against   their conviction and sentences.  In these appeals, the Court  pro- ceeded  on  the  basis as it was  manifest  and  indeed  not disputed  379 that  there was a conspiracy and the only question for  con- sideration  was whether all or some of the  appellants  were parties to it. Held, that the essence of conspiracy is that there should be an agreement between persons to do one or other of the  acts described in the section.  The said agreement may be  proved by direct evidence or may be inferred from acts and  conduct of the parties.  But s. 10 of the Evidence Act intro.  duces the  doctrine  of  agency and if the  conditions  laid  down

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therein  are satisfied, the acts done by one are  admissible against the co-conspirators.  The section can be analysed as follows  :  (1)  There  shall  be  a  prima  facie  evidence affording  a reasonable ground for a court to  believe  that two or more persons are members of a conspiracy; (2) if  the said condition is fulfilled, anything said, done or  written by  any one of them in reference to their  common  intention will be evidence against the other; (3) anything said,  done or written by him after the intention was formed by any  one of  them;  (4)  if it would also be relevant  for  the  said purpose  against another who entered the conspiracy  whether it  was  said,  done  or  written  before  he  entered   the conspiracy or after he left it; and (5) it can only be  used against a co-conspirator and not in his favour. Held,  that so far as the appellant in criminal  appeal  No. 82/62  is  concerned, applying the test laid  down  by  this Court,  the two conspiracies are not the same offence.   The ingredients  of both the offences are totally different  and they do not form the same offence within the meaning of Art. 20 (2) of the Constitution and, therefore, that Article  has no  relevance  to the present case.  Further, there  are  no permissible grounds for upsetting the concurrent findings of both the courts below that the appellant was a member of the conspiracy. Leo Boy Prey v. The Superintendent, District Jail, Amritsar, [1958]  S. C. R. 822 and The State of Bombay v. S. L.  Apte, [1961] 3 S. C. R. 107, relied on. Sardul  Singh  Caveeshar v. State of Bombay,  [1958]  S.C.R. 161, referred to. As  the question raised regarding interpretation of Art.  20 (2)  of  the constitution has already been decided  by  this Court, it cannot be held that the question raised involves a substantial question of law as to the interpretation of  the Constitution  within  the  meaning of Art. 145  (3)  of  the Constitution. State of Jammu & Kashmir v. Thakur Ganga Singh, [1960] 2  S. C. R. 346 relied on. 380 Held,  that  from the relevant provisions of s. 53  and  the Explanation to s. 55 of the Evidence Act., it is clear  that the  evidence of general reputation and general  disposition is  relevant  in a criminal proceeding.   Under  the  Indian Evidence Act, unlike in England, evidence can be given  both of  general character and general disposition.   Disposition means  the inherent qualities of a person; reputation  means the general credit of the person amongst the public.   There is a real distinction between reputation and disposition.  A man  may be reputed to be a good man, but in reality be  may have  a bad disposition.  The value of evidence  as  regards disposition of a person depends not only upon the  witness’s perspicacity  but also on his opportunities to  observe  the person  as well as the said person’s cleverness to hide  his real  traits.  But a disposition of a man may be made up  of many  traits, some good and some bad, and only  evidence  in regard  to  a  particular trait with which  the  witness  is familiar would be of some use. But,  in  any case, the character evidence is a  very  -week evidence;  it  cannot out weight the  positive  evidence  in regard  to  the  guilt of a person.  It  may  be  useful  in doubtful cases to tilt the balance in favour of the  accused or  it  may also afford a background  for  appreciating  his reactions  in  a  given situation.  It must  give  place  to acceptable positive evidence.  The opinion expressed by  the witnesses  does credit to the accused, but, in the  face  of the  positive  evidence  it cannot turn  the  scale  in  his

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favour.

JUDGMENT: CRIMINAL  APPELLATE JURISDICTION: Criminal Appeals Nos.  67, 136 and 172 of 1959 and 82 and 83 of 1962. Appeals  by special leave from the judgment and order  dated November  3, 1958 in Criminal Appeals Nos. 196, 256 and  363 of 1958. B.   B.  Tawakley and S. C. Mazumdar, for the appellant  (in Cr.  A. No. 67159). S.   C. Mazumdar, for the appellant (in Cr.  A. No. 136/59). T.   S. Venakataraman, for the appellant (in Cr. A. No. 172/59).  381 N.   N. Keshwani, for the appellant (in Cr.  A. No. 82/62). C.   B.  Agarwala,  K.  L. Misra, Advocate  General,  U.  P. Mangala  Prasad Baghari, Shanti Sarup Khanduja, Malik  Arjun Das  and  Ganpat  Rai, for the appellant  (in  Cr.   A.  No. 83/62). N.   S.  Bindra,  D.  R.  Prem and R.  H.  Dhebar,  for  the respondent in all the Appeals. 1963.  March 18.  The judgment of the Court was delivered by SUBBA RAO J.-These appeals by special leave arise out of two judgments of the High Court of Bombay, one that of Vyas  and Kotval JJ., dated March 31, 1958, and the other that of Shah and  Shelat  JJ.,  dated  November 3,  1958,  in  what,  for convenience  of reference,, may be described as  the  Empire Conspiracy Case. At  the outset it would be convenient to state  briefly  the case  of the prosecution.  One Lala Shankarlal, a  political leader  and Vice-President of the Forward Bloc and a  highly competent  commercial  magnate, and his  nominees  held  the controlling  block  of  shares  of  the  Tropical  Insurance Company  Limited, hereinafter called the "Tropical", and  he was the Chairman and Managing Director of the said  company. He had also controlling voice in another company called  the Delhi  Swadeshi  Cooperative  Stores Ltd.   The  said  Delhi Stores held a large number of shares of the Tropical.  In or about the middle of 1948, Sardar Sardul Singh Caveeshar, who was  controlling the People’s Insurance Co. Ltd.  and  other concerns  in Lahore, and Kaul, a practising barrister,  came to Delhi.  During that year the former was the President  of the  Forward  Bloc and Shankarlal  was  its  Vice-President. Shankerlal, 382 Caveeshar  and  Kaul conceived the idea  of  purchasing  the controlling block of 63,000 shares of the Jupiter  Insurance Company  Ltd., hereinafter referred to as the "’Jupiter",  a prosperous  company,  in the name of the Tropical  from  the Khaitan  Group  which was holding the said  Jupiter  shares. But  the financial position of the Tropical did  not  permit the said purchase and so they thought of a fraudulent device of  purchasing the said Jupiter shares out of the  funds  of the  Jupiter itself.  Under an agreement entered  into  with the  Khaitan  Group,  the out of the 63,000  shares  of  the Jupiter  was  fixed at Rs. 33,39,000/-, and  the  purchasers agreed  to pay Rs. 5,00,000/- in advance as  "’black  money" and the balance of Rs. 28,39,000/-, representing the  actual price  on paper, within January 20, 1949, i. e.,  after  the purchasers got control of the Jupiter.  After the  purchase, Shankarlal Group took charge of the Jupiter as its Directors after   following  the  necessary  formalities,   sold   the securities of the Jupiter for the required  amount,and  paid

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the balance of the purchase money to    the  Khaitan  Group- within the prescribed time.   In  order  to  cover  up  this fraud  various  manipulations  were  made  in  the  relevant account  books  of  the Jupiter.  There would  be  an  audit before the end of the year and there was every likelihood of detection  of their fraud.  It, therefore, became  necessary for  them to evolve a scheme which would bring in  money  to cover  the said fraud perpetuated by the Directors  of  the. Jupiter in the acquisition of its 63,000 controlling shares. For  that  purpose, Shankarlal and his group  conceived  the idea  of  purchasing  the controlling  interest  in  another insurance company so that the funds of that company might be utilized  to cover up the Jupiter fraud.  With that  object, in or about September 1949, Shankarlal and 9 of his  friends entered into a conspiracy     to  lift  the  funds  of   the Empire  of  India Life Assurance Company  Ltd.,  hereinafter referred to as the "Empire", to cover up the Jupiter  383 fraud.    This  they  intended  to  do  by  purchasing   the controlling  shares of the Empire, by some of them  becoming its  Directors and Secretary, and by utilizing the funds  of the Empire to cover up the defalcations made in the Jupiter. The  following  were  the members of the  conspiracy  :  (1) Shankarlal,  (2)  Kaul,  (3)  Metha,  (4)  Jhaveri  and  (5) Doshi--all  Directors  of  the  Jupiter-and  (6)  Guha,  the Secretary  of the Jupiter, (7) Ramsharan, the  Secretary  of the  Tropical, (8) Caveeshar, the Managing Director  of  the People’s  Insurance  Co., (9) Damodar  Swarup,  a  political worker  who was later on appointed as the Managing  Director of the Empire. (10) Subhedar, another political worker, (11) Sayana,  a businessman of Bombay, and (12)  Bhagwan  Swarup, the   nephew   of  Shankarlal  and   a   retired   Assistant Commissioner  of  Income-tax of the  Patiala  State.   After forming the conspiracy, the controlling shares of the Empire were  purchased  in  the  name  of  Damodar  Swarup  for  an approximate  sum  of  Rs.  43,00,000/-.   For  that  purpose securities  of the Jupiter of the value of  Rs.  48,75,000/- were withdrawn by the Directors of the Jupiter without a re- solution  of  the  Board of Directors  to  that  effect  and endorsed  in  the name of Damodar Swarup again  without  any resolution  of  the  Board  of  Directors  to  that  effect. Damodar  Swarup deposited the said securities in the  Punjab National Bank Ltd., and opened a Cash-credit account in  the said Bank in his own name.  He also executed two  promissory notes to the said Bank for a sum of Rs. 10,00,000/- and  Rs. 43,00,000/-  respectively.  Having opened the said  account, Damodar  Swarup  drew  from the said  account  by  means  of cheques  a sum of Rs. 43,00,000/- and paid the same  towards the  purchase  of the said Empire shares.  Out of  the  said shares  of  the  Empire, qualifying shares  of  twenty  were transferred in each of the names of Damodar Swarup, Subhedar and  Sayana,  and by necessary  resolutions  Damodar  Swarup became the Managing 384 Director  and Chairman of the Empire and the other two,  its Directors,  and Bhagwan Swarup was appointed its  Secretary. The  conspirators  having thus taken control of  the  Empire through some of them, lifted large amounts of the Empire  to the  tune  of Rs. 62,49,700/- by bogus sale and  loans,  and with the said amount they not only recouped the amounts paid out  of  the  Jupiter for the purchase  of  its  controlling shares  and also the large amounts paid for the purchase  of the controlling shares of the Empire.  After the  conspiracy was discovered, in due course the following ten of the  said conspirators,   i.  e.,  all  the   conspirators   excluding

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Shankarlal and another, who died pending the  investigation, were brought to trial before the Court of the Sessions judge for  Greater Bombay under s. 120-B of the Indian Penal  Code and also each one of them separately under s.     409,  read with s. 109, of the said Code : (1) Kaul,(2)    Metha,   (3) Jhaveri, (4) Guha, (5) Ramsbaran,(6)       Caveeshar,    (7) Damodar  Swarup, (8) Subhedar, (9) Sayana, and (10)  Bhagwan Swarup.   The gravemen of the charge against them  was  that they,  along  with  Shankarlal  and  Doshi,  both  of   them deceased,  entered into a criminal conspiracy at Bombay  and elsewhere  between  or about the period from  September  20, 1950 to December 31, 1950 to commit or cause to be committed criminal breach of trust in respect of Government securities or proceeds thereof or the funds of the Empire of India Life Assurance Co. Ltd., Bombay, by acquiring its management  and control  and dominion over the said property in the  way  of business  as  Directors,  Agents or Attorneys  of  the  said Company.  The details of the other charges need not be given as the accused were acquitted in respect thereof. Learned Sessions judge made an elaborate enquiry, considered the  innumerable  documents  filed  and  the  oral  evidence adduced in the case and came to the conclusion that  Accused 1, 2, 4, 5, 6 and 10  385 were guilty of the offence under s. 120-B, read with s.  409 of the Indian Penal Code and sentenced them to various  term of imprisonment.  Accused 6, i. e., Caveeshar, was sentenced to suffer rigorous imprisonment for 5 years, and accused 10, i. e., Bhagwan Swarup, to rigorous imprisonment for a period of  5  ears  and also to pay a fine of Rs.  2,000/-  and  in default to suffer rigorous imprisonment for a further period of six months.  He acquitted accused 3, 7, 8 and 9. The State preferred an appeal to the High Court against that part  of  the-’..judgment  of  the  learned  Sessions  judge acquitting  some of the accused; and the  convicted  accused filed  appeals against their convictions.  The appeal  filed by Caveeshar, Accused-6, was dismissed in limine by the High Court.   The appeals filed by ’the other  convicted  accused against  their convictions were dismissed and the appeal  by the  State against the acquittal of some of the accused  was allowed  by  the High Court.  Accused-7 was sentenced  to  5 years’ rigorous imprisonment, accused-8 to 3 years’ rigorous imprisonment and accused 9 to 3 years rigorous imprisonment. Accused 6, 7, 8, 9 and 10 have, by special leave,  preferred these  appeals against their convictions and sentences.   We are  not  concerned with the other accused as some  of  them died and others did not choose to file appeals. At  the  outset it may be stated that none  of  the  learned counsel  appearing for the accused questioned the factum  of conspiracy;  nor  did they canvass the  correctness  of  the findings  of the Courts below that the funds of  the  Empire were  utilized  to  cover  up the  fraud  committed  in  the Jupiter,  but on behalf of each of the appellants a  serious attempt was made to exculpate him from the offence.  But, as the defalcations made in the finances of the Jupiter and the 386 mode  adopted to lift the funds of the Empire  and  transfer them to the coffers of the Jupiter will have some impact  on the question of the culpability of the appellants, we  shall briefly   notice  the  modus  operandi  of  the  scheme   of conspiracy  and  the  financial  adjustments  made  pursuant thereto. We  have already referred to the fact that Shankarlal  Group purchased the controlling shares of the Jupiter from Khaitan Group and that as a consideration for the said purchase  the

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former  agreed  to pay the latter Rs. 5,00,000/-  as  "black money"  and  pay the balance of about Rs.  28,39,000/-on  or before  January ’-IO, 1949.  After Shankarlal  Group  became the Directors of the Jupiter, they paid the said amount from and  out  of  the funds of the Jupiter.  To  cover  up  that fraud,   on  January  11,  1949,  the  Directors  passed   a resolution granting a loan of Rs. 25,15,000/- to  Accused-6, on  the  basis of an application made by him,  on  equitable mortgage of his properties in Delhi : (see Ex.  Z-22).  They passed another resolution sanctioning the purchase of  plots of  the Delhi Stores, a concern of Shankarlal, for a sum  of Rs.  2,60,000/-.   It is in evidence that Accused-6  had  no property in Delhi and that the said plots were not owned  by the  Delhi Stores.  The said loan and the sale price of  the plots  covered by the said resolutions were really  intended for drawing the money of the Jupiter for paying the  Khaitan Group  before January 20,194-9.  But some  shareholders  got scent  of  the  alleged fraud and issued  notices;  and  the Directors  were also afraid of detection of their  fraud  by the  auditors  during their inspection at the close  of  the year  1949.  It, therefore, became necessary to show in  the accounts  of the Jupiter that the loan alleged to have  been advanced  to Accused-6 was paid off.  For this  purpose  the Directors   brought  into  existence  the   following   four transanctions  :  (1) a loan of Rs. 5,00,000/-  advanced  to Raghavji on November 5, 1949; (2) a loan of  387 Rs.  5,30,000/-  to Misri Devi on December 12, 1949;  (3)  a fresh  loan  of Rs. 5,30,000/- to  Caveeshar,  Accused-6  on November  5,  1949; and (4) a transactions  of  purchase  of 54,000 shares of the Tropical for Rs. 14,00,000/- on May 25, 1949  and December 20, 1949.  These four ficticious  transa- ction  were brought about to show the discharge of the  loan advanced  to  Caveeshar, Accused-6.   Further  manipulations were  made in the accounts showing that parts of  the  loans due  from  Raghavji, Misri Devi and Caveeshar and  also  the price of the Tropical shares were paid by Caveeshar.   These paper entries did not satisfy the auditors and they insisted upon  further scrutiny.  It is the case of  the  prosecution that  Shankarlal  and his  co-conspirators  following  their usual pattern conceived the idea of getting the  controlling interest of the Empire, which had a reserve of Rs. 9 crores. Jupiter securities worth about Rs. 45,00,000/- were endorsed in  favour  of Accused-7, who in his turn endorsed  them  in favour of the Punjab National Bank Ltd., for the purpose  of opening a cash-credit account therein.  On October 5,  1950, under  Ex.  Z-9, the controlling shares of the  Empire  were purchased   from  Ramsharan  Group  and  the   consideration therefor  was paid from and out of the money raised  on  the Jupiter  securities.   The Directors of the Jupiter  had  to make  good to the Company not only the amounts paid  out  of the jupiter funds to purchase the controlling shares of  the Jupiter, in regard to which various manipulations were  made in the Jupiter accounts, but also about Rs.  45,00,000/worth of  securities  transferred in the name of  Damodar  Swarup. Having  purchased  the  controlling shares  of  the  Empire, Shankarlal  and his colleagues got their nominees.,  namely, Accused 7, 8 and 9 as Directors and Accused-10 as the Secre- tary  of the Empire.  On November 27, 1950, a resolution  of the  Directors of the Empire sanctioned the purchase of  Rs. 20,00,000/-- worth of Government 388 Securities  alleged  to belong to the Jupiter.   Though  the securities  were  not delivered,  two  bearer-cheques  dated October  26, 1950 and October 27, 1950 for  Rs.  15,00,000/-

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and Rs. 5,00,000/- respectively were made out and cashed and the said moneys were utilized to cancel the loan alleged  to have  been advanced to Raghavji and for the purchase of  the Tropical shares for Rs. 1,4,00,000/-.  But the  conspirators had still to make good the securities transferred in  favour of  Accused  7  and  other  amounts.   The  Directors  again sanctioned  12  loans, the first six on  November  27,  1950 totalling Rs. 28,20,000/- and the other six on December  18, 1950  totalling  Rs. 42,80,000/-  admittedly  to  fictitious loanees.   12  bearer-cheques  for  an  aggregate   of   Rs. 71,00,000/-  were issued by Accused-10 between  December  19 and 23, 1950.  This amount was utilized for getting 5 drafts for  different  amounts in favour of Accused 1  and  2,  the Directors  of  the Jupiter, Accused-4,  its  Secretary,  and Accused-5,  the Secretary of the Tropical (see Ex.   Z-230). The  said  drafts were sent to Bombay and one  of  the  said drafts  was utilized for paying off the loan of  Misri  Devi and the other Drafts for Rs. 57,00,000/- were paid into  the Jupiter  account in the Punjab National Bank  Ltd.,  Bombay. This  amount was utilized to cover up the loss  incurred  by the  Jupiter  by reason of its securities  worth  about  Rs. 45,00,000/-  assigned  in favour of Accused-7  and  also  by reason  of the securities worth Rs. 20,00,000/-  alleged  to have  been sold to the Empire on November 27, 1950.  It  is, therefore, manifest, and indeed it is not disputed before us now,  that Shankarlal and his co-conspirators, whoever  they may  be, had conspired together and lifted large amounts  of the Empire and put them into the Jupiter coffers to cover up the  loss caused to it by their fraud.  Therefore  in  these appeals we proceed on the basis that there was a  conspiracy as  aforesaid  and the only question  for  consideration  is whether all or some of the appellants were parties to it.  389 Before  dealing with the individual cases, as some  argument was made in regard to the nature of the evidence that should be  adduced  to sustain the case of conspiracy, it  will  be convenient to make at this stage some observations  thereon. Section  120-A of the Indian Penal Code defines the  offence of criminal conspiracy thus               "When  two  or more persons agree  to  do,  or               cause  to  be done an illegal act, or  an  act               which is not illegal by illegal means, such an               agreement    is    designated    a    criminal               conspiracy." The  essence of conspiracy is, therefore, that there  should be  an agreement between persons to do one or other  of  the acts  described in the section.  The said agreement  may  be proved by direct evidence or may   be inferred from acts and conduct of the parties.  There is no difference between  the mode of proof  of the offence of conspiracy and that of  any other offence : it can be established by direct evidence  or by  circumstantial evidence.  But s. 10 of the Evidence  Act introduces the doctrine of agency and if the conditions laid down  therein  are  satisfied,  the acts  done  by  one  are admissible  against the co-conspirators.  The  said  section reads :               "Where  there is reasonable ground to  believe               that  two  or  more  persons  have   conspired               together to commit an offence or an actionable               wrong,  anything said, done or written by  any               one  of  such persons in  reference  to  their               common  intention,  after the time  when  such               intention was first entertained by any one  of               them,  is a relevant fact as against  each  of               the  persons believed to be so  conspiring  as

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             well for the purpose of proving the  existence               of  the  conspiracy  as  for  the  purpose  of               showing  that any such person was a  party  to               it." This section, as the opening words indicate, will come  into play only when the Court is satisfied that 390 there  is  reasonable  ground to believe that  two  or  more persons  have conspired together to commit an offence or  an actionable  wrong, that is to say, there should be  a  prima facie  evidence that a person was a party to the  conspiracy before  his  acts can be used against  his  co-conspirators. Once such a reasonable ground exists, anything said, done or written  by  one  of the conspirators in  reference  to  the common intention, after the said intention was  entertained, is relevant against the others, not only for the purpose  of proving the existence of the conspiracy but also for proving that  the other person was a party to it.   The  evidentiary value  of  the said acts is limited  by  two  circumstances, namely, that the acts shall be in reference to their  common intention  and in respect of a period after  such  intention was  entertained  by any one of them.  The  expression  "’in reference  to their common intention" is very  comprehensive and  it  appears to have been designedly used to give  it  a wider  scope  than  the words "in  furtherance  of"  in  the English  law  ;  with the result,  anything  said,  done  or written by a coconspirator, after the conspiracy was formed, will  be  evidence against the other before he  entered  the field of conspiracy or after he left it.  Another  important limitation  implicit  in the language is  indicated  by  the expressed scope of its relevancy.  Anything so said, done or written  is  a relevant fact only "as against  each  of  the persons believed to be so conspiring as well for the purpose of  proving  the  existence of the  conspiracy  as  for  the purpose  of showing that any such person was a party to  it. It can only be used for the purpose of proving the existence of  the conspiracy or that the other person was a  party  to it.   It cannot be used in favour of the other party or  for the purpose of showing that such a person was not a party to the  conspiracy.  In short, the section can be  analysed  as follows  :  (1)  There  shall  be  a  prima  facie  evidence affording  a reasonable ground for a Court to  believe  that two or more persons are  391 members  of  a  conspiracy ; (2) if the  said  condition  is fulfilled, anything said, done or written by any one of them in  reference  to their common intention  will  be  evidence against the other; (3) anything said, done or written by him should  have  been said, done or written by  him  after  the intention was formed by any one of them ; (4) it would  also be relevant for the said purpose against another who entered the  conspiracy whether it was said, done or written  before he  entered the conspiracy or after he left it ; and (5)  it can  only  be used against a co-conspirator and not  in  his favour; With  this background let us now take the  evidence  against each  of  the appellants and the contentions raised  for  or against him.  But it must be stated that it is not  possible to   separate  each  of  the  accused  in  the   matter   of consideration  of the evidence, for in a case of  conspiracy necessarily there will be common evidence covering the  acts of all the accused.  We may, therefore, in dealing with some of  the  accused, consider also the evidence  that  will  be germane against the other accused. We shall first take the case of Accused-6, Caveeshar, who is

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the appellant in Criminal Appeal No. 82 of 1962.  So far  as this appellant is concerned the learned Sessions judge found that  he was a member of the conspiracy and the  High  Court confirmed that finding.  It is the Practice,, of this  Court not to interfere with concurrent findings of fact  even   in regular appeals and particularly   so in appeals under  Art. 136 of the Constitution.  We would, therefore, approach  the appeal of this accused from that perspective. Learned counsel for this appellant argued before us that the said accused was convicted by the Sessions judge for being a member  of the conspiracy in the Jupiter case in respect  of his acts pertaining 392 to  that conspiracy and therefore he could not be  convicted over again in the present case on the basis of the facts  on which the earlier conviction was founded; in other words, it is  said that he was convicted in the present trial for  the same  offence  in  respect  of which  he  had  already  been convicted  in the Jupiter case and such a  conviction  would infringe  his  fundamental right under Art. 20  (2)  of  the Constitution,  and in support of this  contention  reference was  made to certain decisions of the Supreme Court  of  the United States of America.  The said Article reads :               "No  person shall be prosecuted  and  punished               for the same offence more than once." The previous case in which this accused was convicted was in regard to a conspiracy to commit criminal breach of trust in respect  of  the  funds of the Jupiter  and  that  case  was finally disposed of by this Court in Sardul Singh  Caveeshar v. State of Bombay (1).  Therein it was found that Caveeshar was  a  party  to the conspiracy and also  a  party  to  the fraudulent  transactions entered into by the Jupiter in  his favour.  The present case relates to a different  conspiracy altogether.   The  conspiracy in question was  to  lift  the funds  of the Empire, though its object was to cover up  the fraud  committed in respect of the Jupiter.  Therefore.,  it may  be that the defalcations made in Jupiter may  afford  a motive  for  the new conspiracy, but the  two  offences  are distinct  ones.  Some accused may be common to both of  them some of the facts proved to establish the Jupiter conspiracy may  also  have to be proved to support the motive  for  the second  conspiracy.  The question is whether that in  itself would be sufficient to make the two conspiracies the one and the  same  offence.   Learned  counsel  suggests  that   the question  raised involves the interpretation of a  provision of the Constitution and therefore the appeal of this accused (1)  [1958] S. C. R. 161.  393 will  have to be referred to a Bench consisting of not  less than 5 judges.  Under Art. 145 (3) of the Constitution  only a  case  involving a substantial question of law as  to  the interpretation of the Constitution shall be heard by a Bench comprising not less than 5 Judges.  This Court held in State of  Jammu  &  Kashmir  v. Thakur Ganga  Singh  (1),  that  a substantial question of interpretation of a provision of the Constitution  cannot arise when the law on the  subject  has been  finally  and effectively decided by this  Court.   Two decisions  of  this Court have construed the  provisions  of Art.  20  (2)  of the Constitution in  the  context  of  the expression   "same  offence."  In  Leo  Roy  Frey   v.   The Superintendent,  District  Jail, Amritsar  (2),  proceedings were  taken  against certain persons in the  first  instance before  the customs authorities under s. 167 (8) of the  Sea Customs  Act  and heavy personal penalties were  imposed  on them. thereafter, they were charged for an offence under  s.

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120-B  of  the Indian Penal Code.  This Court held  that  an offence under s. 120-B is not the same offence as that under the  Sea  Customs Act.  Das C. J., speaking for  the  Court, observed :               "The offence of a conspiracy to commit a crime               is a different offence from the crime that  is               the  object  of  the  conspiracy  because  the               conspiracy  precedes  the  commission  of  the               crime  and  is complete before  the  crime  is               attempted  or  completed,  equally  the  crime               attempted  or completed does not  require  the               element   of   conspiracy  as   one   of   its               ingredients.    They   are,therefore,    quite               separate offences." This  Court again considered the scope of the  words  "’same offence" in The State of Bombay v. ,S.  L. Apte (3).   There the  respondents  were both convicted and sentenced  by  the Magistrate under s. 409 of the Indian Penal Code and s.  105 of the Insurance Act.  Dealing with the argument that the (1) [1960] 2 S.C.R.346. (2) [1958] S. C. R. 822, 827, (3)[1961] 3.S.C.R.,107,114. 394 allegations  of fact were the same, Rajagopala Ayyangar  J., rejecting the contention, observed on behalf of the Court :               "To  operate as a bar the  second  prosecution               and  the consequential punishment  thereunder,               must be for ‘the e same offence’.  The crucial               requirement,  therefore,  for  attracting  the               Article  is that the offences arc the same  i.               e.,  they should be identical.   If,  however,               the   two   offences   are   distinct,    then               notwithstanding  that the allegations of  fact               in  the two complaints might be  substantially               similar,  the  benefit of the  ban  cannot  be               invoked.   It  is,  therefore,  necessary   to               analyse and compare not the allegations in the               two complaints but the ingredients of the  two               offences  and  see whether their  identity  is               made out." This  decision lays down that the test to ascertain  whether two  offences  are  the  same is not  the  identity  of  the allegations  but  the  identity of the  ingredients  of  the offences.  In view of the said decisions of this Court,  the American  decisions  cited  at  the  Bar  do  not  call  for consideration.   As  the question raised  has  already  been decided by this Court, what remains is only the  application of the principle laid down to the facts of the present case. cannot, therefore, hold that the question raised involves  a substantial question of law as to the interpretation of  the Constitution  within  the  meaning of Art. 145  (3)  of  the Constitution. In  the  present case, applying the test laid down  by  this Court,  the two conspiracies are not the same offence :  the Jupiter  conspiracy  came  to an’ end when  its  funds  were misappropriated.    The   Empire  conspiracy   was   hatched subsequently, though its ’Object had an intimate  connection with the Jupiter in that the fraud of the Empire was concei. ved and executed to cover up the fraud of the  395 Jupiter.   The two conspiracies are distinct  offences.   It cannot even be said that some of the ingredients of both the conspiracies  are  the  same.  The  facts  constituting  the Jupiter conspiracy are not the ingredients of the offence of the  Empire  conspiracy,, but only afford a motive  for  the

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latter offence.  Motive is not an ingredient of an  offence. The  proof  of motive helps a Court in coming to  a  correct conclusion when there is no direct evidence.  Where there is direct  evidence for implicating an accused in  an  offence, the  absence  of  proof  of motive  is  not  material.   The ingredients  of both the offences are totally different  and they do not form the same offence within the meaning of Art. 20 (2) of the Constitution and, therefore, that Article  has no relevance to the present case. The  next question is whether this appellant was a party  to the  Empire  conspiracy.   He  was  a  close  associate   of Shankarlal in the political field, he being the President of the  Forward Bloc and Shankarlal being  its  Vice-President. That  is  how  they  were drawn  together.   There  is  also evidence  that out of the 63,000 shares of the Jupiter  that were  purchased  in August, 1949 by Shankarlal  Group,  4475 shares  were allotted to this appellant.  It is,  therefore, clear  that  Accused-6  though ex facie  he  was  neither  a Director  nor  an office-bearer in the  Jupiter,  had  heavy stakes  in  it.   We have already  noticed  that  after  the purchase  of  the said shares from and out  of  the  Jupiter funds,  a bogus loan in the name of Accused-6 for a  sum  of Rs. 25,15,000/- was shown in the Jupiter accounts and  later on it was substituted by other manipulations. [His  Lordship then proceeded to consider the evidence.] x      x     x     x     x     x      x     x Both the Courts on the basis of the aforesaid evidence  came to the conclusion that Accused-6 was 396 a  member of the conspiracy and we cannot say that there  is no  evidence  on  which the Courts could have  come  to  the conclusion  to  which  they did. there  are  no  permissible grounds  for  upsetting this finding under Art. 136  of  the Constitution. As  regards  the sentence passed against this  accused,  the Sessions   Judge   sentenced   him   to   undergo   rigorous imprisonment  for a period of 5 years, whereas he  sentenced Accused  7, 8 and 9 to undergo rigorous imprisonment  for  a period of 3 years only.  We do not see any justification for this  distinction between the said accused in the matter  of punishment.    Accused6  had  already  been  convicted   and sentenced  in the Jupiter case; and on the evidence it  does not  appear  that he had taken a major part  in  the  Empire conspiracy,   though  he  was  certainly  in  it.   In   the circumstances, we think that a sentence of 3 years’ rigorous imprisonment  would  equally  suffice  in  his  case.    We, therefore,  modify the sentence passed on him  and  sentence him  to undergo rigorous imprisonment for 3 years.   Subject to  the  aforesaid  modification, the  appeal  preferred  by Caveeshar, Accused-6, is dismissed. We  shall  now proceed to consider the appeal  preferred  by Damodar  Swarup, Accused-7 i. e., Criminal Appeal No. 83  of 1962.   Accused-7 was the Managing Director and Chairman  of the Empire during the period of the conspiracy.  On  October 17,  1950  he  was  elected the Chairman  of  the  Board  of Directors  of the Empire and appointed as Managing  Director on a salary of Rs. 2,000/per month for a period of one year. He  was  removed from the post of Managing Director  at  the meeting  of the Board of Directors held on March  12,  1951. The  misappropriation of the funds of the Empire,  which  is the subject-matter of the conspiracy, were committed  during the period of his Managing Directorship i. e., between  397 September 20 and December 31, 1950.  The prosecution case is that  Accused-7 was a party to the conspiracy,  whereas  the

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defence  version is that he was a benamidar for  Shankarlal, that  he  took  part  in the proceedings  of  the  Board  of Directors bona fide, believing that there was nothing wrong, that  the resolutions were implemented by Accused- 10  under the  directions of Shankarlal and that the moment he  had  a suspicion  that there was some fraud, he took immediate  and effective  steps  not only to prevent the rot  but  also  to investigate and find out the real culprits.  The question is which version is true. It  would  be useful to have a correct appreciation  of  the evidence to know the antecedents of Accused-7. [His Lordship then proceeded to consider the evidence.] x       x       x         x      x       x Learned  counsel for Accused-7 contends that  the  following two  important circumstances in this case  established  that Accused-7  was  a victim of circumstances and  that  he  was innocent : (1) Two prominent publicmen of this country  with whom  the accused worked gave evidence that he was a man  of integrity; and (2) the accused took active steps to  unravel the  fraud and to bring to book every guilty person;  if  he was  a  conspirator, the argument proceeds,  it  was  incon- ceivable  that he would have taken such steps, for it  would have certainly recoiled on him.  We shall consider these two aspects now. [His Lordship then proceeded    to consider the evidence.] x x          x          x The  question  is  what is the  evidentiary  value  of  good character  of an accused in a criminal case.   The  relevant provisions  are  s. 53 and the Explanation to s. 55  of  the evidence Act.  They read : Section 53.  In criminal proceedings the fact 398 that the person accused is of a good character is relevant.                 Explaination to 8. 55.  In sections 52,  53,               54 and 55, the word "character" includes  both               reputation  and  disposition;  but  except  as               provided in section 54, evidence may be  given               only   of  general  reputation   and   general               disposition,  and  not of particular  acts  by               which reputation, or disposition were shown. It  is clear from the said provisions that the  evidence  of general reputation and general disposition is relevant in  a criminal proceeding.  Under the Indian Evidence Act,  unlike in England, evidence can be given both of general  character and  general  disposition.  Disposition means  the  inherent qualities  of a person; reputation means the general  credit of the person amongst the public.  There is a real  distinc- tion  between  reputation  and disposition.  A  man  may  be reputed  to be a good man, but in reality he may have a  bad disposition.   The value of evidence as regards  disposition of a person depends not only upon the witness’s perspicacity but also on his opportunities to observe the person as  well as  the  said person’s cleverness to hide his  real  traits. But  a disposition of a man may be made up of  many  traits, some  good  and some bad, and only evidence in regard  to  a particular trait with which the witness is familiar would be of  some use.Wigmore puts the proposition in  the  following manner :               "Whether,  when admitted, it should  be  given               weight  except in a doubtful case, or  whether               it may suffice of itself to create a doubt, is               a  mere  question of the weight  of  evidence,               with which the rules of admissibility have  no               concerned But,  in  any case, the character evidence is  a  very  weak

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evidence : it cannot outweigh the positive  399 evidence  in  regard to the guilt of a person.   It  may  be useful  in doubtful cases to tilt the balance in  favour  of the  accused  or  it  may  also  afford  a  background   for appreciating his reactions in a given situation.  It    must give place to acceptable positive evidence.  The     opinion expressed by the witnesses does credit to    the    accused, but,  in our view, in the face of the positive  evidence  we have  already  considered, it cannot turn the scale  in  his favour. Learned counsel strongly relied upon the subsequent  conduct of Accused-7 in support of his innocence. [His Lordship then proceeded  to consider the evidence relating  to  subsequent Conduct and Considered as follows] x      x      x      x     x      x     x     x We,  therefore,  hold  that Accuscd-7 was  a  party  to  the conspiracy and that the High Court has rightly convicted him under  s.  120-B of the Indian Penal Code.  As  regards  the sentence passed on Accused-7, having regard to the  evidence in  this  case, we think that this accused must be  given  a comparatively less punishment than his co-conspirators, for, though he took part in the conspiracy, at any rate from  the end  of  December, 1950, for one reason or  other,  he  took necessary  proceedings  to bring to light  the  fraud.   We, therefore,  think that it would meet the ends of justice  if the  accused  was sentenced to rigorous imprisonment  for  a period  of  two years.  We accordingly modify  the  sentence passed  on  him  by  the High  Court  and,  subject  to  the aforesaid  modification, we dismiss the appeal preferred  by him. Next we come to Criminal Appeal No. 136 of 1959 preferred by Subhedar, Accused-8.  The defence of this accused is that he acted  throughout  in good faith and under the  guidance  of Accused-7, the Managing Director of the Empire, and that  he did  not know that any fraud was perpetrated in the  Empire. Before joining the Empire he was an 400 insurance  agent and, therefore, it cannot be said  that  he was  a  stranger  to the insurance business and  he  may  be assumed  to know how it would be conducted.  On October  16, 1950  twenty qualifying shares of the Empire from among  the shares  purchased in the name of Accused-7 were  transferred in his favour and thereafter at the meeting held on that day he  was co-opted as a Director.  He is also, therefore,  one of the persons brought in by Shankarlal and made a  Director for  his  own  purpose.  [His  Lordship  then  proceeded  to consider the evidence]                           x x x x x x We  have no doubt that the aforesaid circumstances  lead  to only  one reasonable conclusion that this accused  became  a Director  of  the Empire as a member of the  conspiracy  and helped  to  put through all the  transactions  necessary  to transfer  funds  from  one Company to  the  other.   He  was rightly  convicted  by the High Court.  We do  not  see  any reason  to interfere with the sentence passed  against  him. In the result Criminal Appeal No. 136 of 1959 is dismissed. Criminal  Appeal  No. 172 of 1959 is  preferred  by  Sayana, Accused-9.   He  was  a building contractor  before  he  was appointed  a  Director of the Empire.  His defence  is  also that he bona fide acted without knowledge of the  conspiracy or  the  fraud.  He was also one of the  Directors  inducted into  the Company by the transfer of qualifying shares  from and  out of the shares purchased in the name  of  Accused-7. He was co-opted as a Director on October 17, 1950 under  Ex.

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Z  206C.   Though  he  was not present  at  the  meeting  of November 27, 1950, he was present at the meeting of December 18,  1950 and, therefore, with the knowledge that six  loans amounting to Rs. 28,80,000/- were advanced without  scrutiny of the securities, he was a party in sanctioning another six loans  totalling to Rs. 42,80,000/-.  He as also a party  to the resolution of January 30, 1951  401 sanctioning a bogus loan to the chief of Bagarian.  He was a party to the resolution dated February 9, 1951 when the said loan  was  confirmed  and  to  the  resolution   authorizing Accused-9 to operate singly the accounts of the Company. Evidence considered [omitted] x            x              x              x It   is,  therefore,  clear  that  he  was  a  creature   of Shankarlal,  that  he was a party to the  diversion  of  the funds of the Empire to the Jupiter and that when  Accused-7, for  his own reasons, was taking steps to stop the rot,  he, along  with  Accused-8,  obstructed him from  doing  so  and wholly   supported   Accused-  10.   The   only   reasonable hypothesis  on  the evidence is that he was a party  to  the conspiracy.   It  is said by learned counsel  appearing  for this accused that his subsequent conduct would not  indicate any obstructive attitude on his part but would indicate only his  desire  to  maintain the status quo  till  the  matters improved.   This is a lame explanation, for he,  along  with the  other Directors, opposed every attempt of the  scrutiny of  the Company’s affairs and this can only be because  they were conscious of their part in the fraud. In  this  context another argument of  learned  counsel  for Accused  8 and 9 may be noticed.  It is said that  the  High Court  treated  the Directors as trustees and  proceeded  to approach the case from that standpoint inferring criminality from  their  inaction.   Even assuming that  they  were  not trustees in the technical sense of the term, they  certainly stood  in  a fiduciary relationship with  the  shareholders. The  High  Court’s finding is not based upon  any  technical relationship  between the parties, but on the  facts  found. On the facts, including those relating to the conduct of the accused, the High Court drew a reasonable inference of guilt of  the accused.  There is sufficient evidence on which  the High Court  402 could  have reasonably convicted Accused 8 and 9 and in  the circumstances,  we do not see any case had been made out  in an  appeal under Art. 136 of the Constitution to  merit  our interference. In the result Criminal Appeal No. 172 of 1959 is dismissed. Finally we come to Criminal Appeal No. 67 of 1959  preferred by Bhagwan Swarup, Accused-10.  The defence of this  accused is that he acted throughout on the directions of Accused  7, 8 and 9, and that as Secretary of the Company, he was  bound to  follow their directions.  This accused is the nephew  of Shankarlal.   He is an M. A., LL.  B. He held the office  of Assistant  Commissioner of Income-tax in Patiala State.   He is  the person who carried out the resolutions of the  Board of  Directors  of the Empire through intricate  channels  to enable the large amounts misappropriated   to   reach    the Jupiter Company.    It  is  suggested that he was  not  well disposed of    towards Shankarlal and therefore he could not have any knowledge of Shankarlal’s fraudulent motives behind the  purchase of the controlling shares of the  Empire.   If Shankarlal  did not like him lie would not have put  him  in the  key  position  in  the Empire.   Indeed,  the  will  of Shankarlal shows that this accused got the best legacy under

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it.  He was the connecting thread passing through the web of conspiracy  from  beginning  to  end.   Evidence  Considered [omitted] x     x     x     x     x      x     x     x Learned counsel appearing for this accused Could only  argue that the accused was a subordinate of the Directors and that he  had  followed only loyally the directions given  by  the Managing  Director without any knowledge of the  conspiracy. This argument is an oversimplification of the part taken  by Accused-10 in this huge fraud.  Both the Courts below have  403 held,  on  the aforesaid circumstances and  other  evidence; that Accused-10 was an active participant in the conspiracy. In our view, there is ample material to justify it.  In  the result Criminal Appeal No. 67 of 1959 is dismissed.       Cr.  A. No. 82 of 1962 dismissed. Sentence modified.       Cr.  A. No. 83 of 1962 dismissed. Sentence modified.       Cr.  A. No. 136 of 1959 dismissed.       Cr.  A. No. 172 of 1959 dismissed.       Cr.  A. No. 67 of 1959 dismissed.