Authored By : Beverley, T. Ameer Ali

Beverley, J.

1. "This was a rule obtained by the Advocate-General inthe case of His Highness the Nizam of Hyderabad v. Alexander Malcolm Jacob nowunder enquiry by the Chief Presidency Magistrate, calling upon the Magistrateto show cause why a certain order of his, by which he refused to direct theproduction in his Court of certain currency notes, &c, should not be setaside, and why an order should not be now made for their production. [HisLordship here stated the facts out of which the application arose.] It appearsthat on the 17th instant it was elicited from a witness in cross-examinationthat fifteen out of these seventeen notes had been produced by Jacob and hissolicitor at the Bank that very morning for identification, for what purpose isnot very clear nor very material. Upon this fact coming out in evidence, viz.,that Jacob still had in his possession fifteen of the notes for Rs. 10,000which were paid to him on the 27th July, an application was made to theMagistrate for an order for their production in Court, under Section 94 of theCode. The application was opposed by Mr. Inverarity, who appeared as counselfor Jacob, and who is said to have given the Magistrate to understand thatJacob did not intend to touch the said notes, but to preserve them intact tothe end of the trial." The Magistrate accordingly refused the application.Mr. Geddes, in his affidavit, puts the matter somewhat differently, allegingthat Mr. Inverarity stated "that Jacob was anxious, if he possibly coulddo so, to keep the notes till the end of the trial." Whatever were theexact words used, we think upon the materials before us that they were intendedto be understood by the Magistrate, and were understood by him, as an impliedundertaking that the notes would not be dealt with during the pendency of theseproceedings, and that it was in consequence of this implied undertaking thatthe Magistrate made no order regarding the notes on the 17th instant.

2. On the morning of the 19th the prosecution receivedintimation that five of the above notes had been cashed at the Currency Officethat morning by Mr. Burder, of Bombay, and a fresh application was accordinglymade to the Magistrate for an order, under Section 94, upon Jacob and Mr.Burder for the production of the said fifteen notes or their proceeds. An orderwas thereupon made for the production of the ten notes that had not beenalready cashed; but upon Mr. Burder appearing and objecting that he had a lienupon five of the notes, and declining to give them up, the Magistrate refusedto make any order respecting them. The other five notes were apparentlyproduced through Mr.Geddes, and are now, we understand, in the MagistratesCourt. The matter before us, therefore, has reference (1) to the five notesstill held by Mr.Burder, and (2) to the proceeds of the five notes cashed byhim on the 19th.

3. The Magistrate has written a letter explaining his actionin the matter, and we have also heard Mr. Monmohun Ghose on behalf of Jacob. Inhis explanation the Magistrate states that as regards the five notes inBurders possession be entertained doubts as to whether he had the power tocompel their production, inasmuch as it appeared to him that Burder had a bonafide lien upon thorn for costs already incurred and to be incurred; and asregards the five notes that had been cashed, the Magistrate is of opinion thatthe proceeds, not being specific objects, do not fall within the terms of thesection. The concluding portion of the Magistrates letter is wholly outsidethe question now before us. It is not a question of the adequate protection ofthe Nizams interests in the event of a conviction, but of the power andexpediency of having brought into Court the subject-matter in respect of whichJacob is charged with criminal breach of trust; and we may add the Magistratehas to a certain extent admitted that power and expediency by insisting on theproduction of five notes through Mr. Geddes. Mr. Ghose has contended before usthat the Magistrate had no power whatever to make any order for the productionof the notes under Section 94; that that section has reference only to theproduction of documents or things required for purposes of evidence, and thatit was never intended that it should be used for the purpose of bringingproperty into Court with a view to its being subsequently disposed of by anorder under Section 517 of the Code. Mr. Ghose further questioned the power ofthis Court to interfere with the Magistrates order, and challenged the otherside to point out a single reported case in which this Court had everinterfered.

4. As regards this last point, we may at once say thatSection 435 of the Code gives this Court ample power to interfere, should itsee fit to do so, in any case where a Magistrate has either refused to exercisea discretion vested in him by law, or has exercised that discretion in an impropermanner, or on improper grounds. That no precedent is to be found in the booksmay be, because up to this no case has occurred of sufficient importance towarrant the parties in invoking the interference of this Court. It seems to usthat even accepting Mr. Ghoses argument, it was open to the Magistrate torequire the production of these notes for evidentiary purposes. The possessionof the identical notes which were paid by the Bank on presentation of thecheque for Rs. 1,77,131-1-2 would be good evidence that Jacob received theproceeds of that cheque. It seems to be assumed that the production of thenotes was required either in order to cripple Jacobs resources, or with a viewto some order in the future under Section 517 or, as Mr. Ghose puts it, by wayof attachment before judgment. We see no sufficient ground for this assumptionupon the materials before us.

5. Putting aside, however, the question of evidence, we areof opinion that every Court is entitled to have before it, and to retain duringthe pendency of the proceedings, any property which forms the subject of acharge pending before it, as Patterson, J. said in Rex v. ODonnell 7 C. &P. 138: "Generally speaking, it is not right that a mans money should betaken away from him, unless it is connected in some way with the propertystolen. If it is connected with the robbery, it is quite proper that it shouldbe taken". So in Rex v. Burgiss 7 C. & P. 488 where the prisoner wascharged with having altered and cashed a forged promissory note for 26, and 28sovereigns were found upon him, Littledale, J., said: "I have conferredwith my brother PATTERSON, who says that if there is reasonable ground tosuppose that these sovereigns are the proceeds of notes obtained by either ofthe alleged forgeries, they ought not to be given up. I think in the presentcase that it is not unreasonable to suppose that the 26 was part of the moneyobtained, and I think I cannot order that to be given back. The surplus must berestored". A similar order was made in Rex v. Rooney 7 C. & P. 515.Those were cases in which the money found in the possession of the accusedcould not be identified. In the present case these notes can be, and are,identified as having been paid to Jacob on the 27th July. We are of opinion,therefore, that they were connected with the subject-matter of the charge, andthat the Magistrate was entitled and bound to compel their production. Asregards Mr. Burders objection that be had a lien on five of the notes, that,in our opinion, was no sufficient reason for the non-production of the notes.That was a matter to be dealt with subsequently, under Section 517 of the Code.The cases of Empress v. Jogessur Mochi I.L.R. 3 Cal. 379 and Ex parte MadavjiDharramsi 12 Bom. H.C. 217 are instances in which an order has been made uponthird parties to produce the subject-matter of the charge, irrespective of anyorder which might be made afterwards as to the disposal of the property. We areof opinion that Mr. Burder should now be required to produce the five noteswhich he admits are in his power.

6. Similarly, as regards the proceeds of the five notes thathave been cashed, we are of opinion, upon the authorities cited, that if theseproceeds can be reasonably connected with the subject-matter of the charge, theMagistrate has power to order their production in Court. And in expressing thisopinion we must not be understood to dissent in any way from the principleslaid down in the case of Empress v. Jogessur Mochi I.L.R. Cal. 379. That casedecided a point wholly different from that now before us. That was a referencein respect of an order made under the section of the Code then in force,corresponding to Section 517 of the present Code, and it had reference to theultimate disposal of the property. That question is not now before us. Wethink, therefore, that the order of the Presidency Magistrate must be setaside, and we set it aside accordingly, and direct him to proceed according tolaw, having regard to the observations we have made.

T. Ameer Ali, J.

7. I entirely agree with the judgment of my learnedcolleague; but as the question raised for our decision is one of someimportance, I wish to add a few observations. The learned Chief Magistrate, inrefusing to make an order on Mr. Burder, seems to have acted on two grounds:(1) that Mr. Burder claimed a lien over five of the notes; and (2) that, asregards the notes into which he had converted the five others received by himfrom Jacob, it was unnecessary to make any order, for the Nizam was sufficientlysecured, and he (the Magistrate) might possibly, in case Mr. Burder hadconverted them again, have to engage in a large collateral enquiry. Thisrepresents to my mind the sum and substance of the explanation submitted by theMagistrate. Neither of these considerations, however, touches the real questionat issue. Mr. Jacob is charged with criminal breach of trust in respect of alarge sum of money. Part of this money, it is stated, came into his hands inthe shape of fifteen notes of Rs. 10,000 each, ten of which he made over to Mr.Burder. No claim of lien on the part of Mr. Burder can affect the character ofthose notes as the proceeds of an offence. For the purposes of this decision,upon the alleged facts, they are as much the proceeds of an offence as if thecheque which Jacob received from Kilburn and Company had been actually handedto him by the owner of the money. The case for the prosecution is that thetwenty-three lakhs were placed under Jacobs disposal for a specified purpose;the right in the money was never parted with absolutely; that the cheque whichhe received represented the Nizams money, and in cashing it and converting theproceeds thereof to his own use he committed the offence of criminal breach oftrust. Upon that case the notes received by him would be the proceeds of theoffence. Suppose a cheque payable to bearer is entrusted to a servant, and he,after receiving payment from the Bank, absconds. The notes, however, aredeposited by him with a third person. Can it be contended that those notes arenot the proceeds of an offence, as much a part of the corpus delicti as if theyhad been actually stolen from the masters box Suppose a cheque is sent to aperson with a direction to apply it to a certain purpose. Instead of so doinghe cashes it and appropriates the money to his own use, as happened in the caseof Reg. v. Cronmire 54 L.T. 580. Can it be said that the money received by himwas not the proceeds of an offence, and if he had deposited it with a thirdperson and it could reasonably be connected with the cashing of the cheque,that the Court is debarred from calling for its production for purposes of theenquiry Or take another case. A horse is stolen by A and placed by him in alivery stable. The livery stable-keeper receives it bona fide and claims a lienfor its keep. Would that change the character of the stolen property or preventthe Magistrate from requiring its production In the case of The Queen v. DeBanks L.R. 13 Q.B.D. 29 Banks was convicted of larceny as a bailee in respectof a sum of money received by him for the price of a mare entrusted to him forsale; the money was the subject-matter of the larceny; and even if he haddeposited it with a third person it would not have altered the character of theproperty in respect of which the offence was charged. Nor would the mere factof Mr. Burder converting some of the notes into others of smaller value andholding them for himself or the accused affect the question. The reasons,therefore, assigned by the learned Magistrate do not seem to be valid, nor wasany attempt made to support his order upon grounds on which he had based it. Asa matter of fact, Mr. Ghose, who was heard for the accused, as well asgenerally on the case, impugned the reason given by the Magistrate aserroneous. Mr. Ghose took up a higher ground altogether. He contended that theMagistrate had absolutely no power to call either upon the accused or upon hisbailee for the production of anything alleged to be connected with the offence.In the course of the argument, however, he modified this somewhat startlingproposition, and admitted that under the section the Magistrate can call fordocuments or other things, though only for purposes of evidence in a pendingproceeding. Now, the words of Section 94 are very large, and it seems advisedlyso. It runs thus: "Whenever any Court or, in any place beyond the limitsof the towns of Calcutta and Bombay, any officer in charge of a police-stationconsiders that the production of any document or other thing is necessary ordesirable for the purposes of any investigation, enquiry or trial or otherproceeding under this Code by or before such Court or officer, such Court mayissue a summons, or such officer a written order, to the person in whose possessionor power such document or thing is believed to be, requiring him to attend andproduce it, or to produce it at the time and place stated in the summons ororder." Having regard to the words of this section, it seems to me aMagistrate has the power of calling upon any person to produce any documentor"thing," in that persons possession or power, which has anyconnection with the offence which happens to be under investigation or enquiry.Of course he cannot call for anything and everything from anybody andeverybody. The thing called for must have some relation to, or connection with,the subject-matter of the investigation or enquiry, or throw some light on theproceeding, or supply some link in the chain of evidence. It may be that thething called for may turn out to be wholly irrelevant to the enquiry; but solong as it is considered to be necessary or desirable for the purposes of theenquiry, the power is there. Any other view of the scope and object of thissection will paralyse the administration of criminal justice, and render manyenquiries into alleged offences wholly infructuous, for once the subject-matterof an offence has changed hands or has changed shape, the investigation mustcome to an end. In the present case the notes in Mr. Burders hands, ifconnected with the cheque which Jacob received and which he admittedly cashed,would seem to have an important bearing on the matter under enquiry before theMagistrate; and their production would no doubt be desirable for the purposesof that enquiry. I have refrained from expressing any opinion on the questionwhether the order under Section 94, Criminal Procedure Code, can be made with aview to or in anticipation of a proceeding under Section 517, as it isunnecessary to discuss it for the purposes of this case. But I must not besupposed to assent to the proposition that a proceeding under Section 517 iswholly independent of, or unconnected with, the enquiry or proceeding referredto in Section 94. On the whole, I think that the learned Chief Magistrate inrefusing to entertain the application under Section 94 of the Code acted uponan erroneous view of the law, and I concur in reversing his order.

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H.H. The Nizam of Hyderabadvs. A.M. Jacob (28.08.1891 -CALHC)