STATE Vs. JAGANNATH SINGHAL

JUDGEMENT

(1.) The opposite party Jagannath Singhal (hereinafter referred to as Singhal) holds a decree for a sum of RS. 17,344/4/- against the Rampur Bankers Ltd., Rampur (hereinafter called the Bankers). The Bankers had advertised that for every deposit of Rs. 100/- they would pay to the depositor a sum of Rs. 687/7/- after the expiry of six months. Singhal had deposited with the Bankers a sum of Rs. 2,500/- and claimed from them a sum of Rs. 17,344/47- which they did not pay. Consequently he filed a suit and1 obtained the decree mentioned above. In the meantime the directors and some of the employees of the Bankers were convicted under Section 420, I. P. C., for having cheated the public by making a false representation that for every sum of Rs. 100/deposited thty would after the expiry of six months pay to the depositor a sum of Rs. 687/7/-. When the criminal case had been started the State seized large sums of money from the custody of the Bankers on the ground that the same had been obtained by the commission of the crime of cheating. Singhal put his decree into execution and got some sums out of the amount seized by the Government attached. The State of U. P. objected to the attachment and the learned Civil Judge, Moradabad, on 8-8-1956 allowed the attachment to the extent of Rs. 2,500/- to stand, releasing the rest of the amount from attachment. It is against that order that the State of U. P. has come up in revision under Section 115, C. P. C.

(2.) Mr. A. K. Kirty who appears for Singhal has raised a preliminary objection to the effect that under the provisions of Rule 63 of Order XXI, C. P. C,, the only remedy which a party against whom an order under Rule 58 of Order XXE C. P. C., has been passed is to institute a regular suit and the order passed under the latter provision, subject to the result of such suit, remains conclusive, In my opinion the preliminary objection is not well founded. When an order under Rule 58 of Order XXL C. P. C., is revised by this Court under Section 115 of that Code the order as modified or set aside by this Court becomes an order under Order XXI, Rule 58 instead of the original order which stands superseded or modified. There is no justification for the submission that an order passed under Order XXI, Rule 58 cannot be revised by this Court. The view that I am taking is in accord with the decision of this Court in the case of Lila v. Mahange, AIR 1931 All 632 (FB) as also of Bachu Lal v. Ram Din, AIR 1939 All 117. The preliminary objection is therefore rejected.

(3.) Coming to the merits it may be stated at the outset that it is the admitted case of the parties that no order under Section 517, Cri. P. C., was passed by the criminal court which convicted the directors as also some of the employees of the Bankers under Section 420, I. P. C. Consequently there is no direction of the criminal court with regard to the sums of money seized by the police from the Bankers, The question for determination, therefore, is whether in these circumstances the money in the hands of the Government will be deemed to be their money or that of the Bankers or that of the depositors. Mr. Shambhu Prasad on behalf of the State has made what I may call to be a tall claim. His submission is that apart from the provisions of the Cri. P. C, or statutes or Statutory orders dealing with matters relating to forfeiture of property the state has a general power to forfeit to itself all the property which has been obtained by a convicted person by committing a criminal offence. He has, however, not been able to point out the source of the power either by means of showing any statutory provision or a written text or decided case. Even the State can only act in accordance with the law. It is trite saying that law binds both the rulers and the subjects. Therefore there can be no forfeiture of property except under the law. That is so all the more in our country because Article 19 of the Constitution guarantees to every Indian citizen the right fo enjoy his property subject only to reasonable restrictions and Article 31 provides that there will be no acquisition of property except as provided by law. There is thus to my mind no scope for the submission that the State has any general or inherent power to forfeit] property acquired by committing a crime or used in the commission of a crime, It is true that the State has the right of eminent domain to acquire for public purposes the property belonging to a subject but in accordance with the law and after paying compensation. Similarly where a person dies leaving property and there is a total failure of heirs the law of escheat intervenes vesting the property in the State on the ground that private ownership does not exist and the State becomes the owner as ultimate Lord (see Collector of Masuliputam v Cavaly Vencata Narrainapah, 8 Moo Ind App 500 at p. 525 (PC)). It is also well established that property by which or for which an offence has been committed has ultimately to go to its real Owner and an order passed by a criminal court under Section 517 CM. P. C., does not settle any rights nor confers any title. It only empowers the criminal court to dispose of the property in a Summary manner (see Ibrahim Rahamatullah v. Emperor, AIR 1947 Nag 33). The matter can finally be decided only by a civil court. Even in cases where the criminal court does not pass any order with regard to a property with which or in respect of which an offence has been committed, the civil court of competent jurisdiction can pass a decree in respect o that property in favour of its real owner.