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TMI Blog1957 (5) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... and 54, Sardul Singh Caveeshar and Parmeshwar Nath Kaul, by a majority verdict and appellants in Criminal Appeals Nos. 55 and 56, Vallabhdas Pulchand Mehta and Charucharan Guha, by an unanimous verdict. The verdicts of the jury were accepted by the Sessions Judge who sentenced the appellants as follows : Appellant Sardul Singh Caveeshar to rigorous imprisonment for three years and a fine of ₹ 2,500. Appellant Parmeshwar Nath Kaul to rigorous imprisonment for five years and a fine of ₹ 5,000. Appellant Vallabhdas Phulchand Mehta to rigorous imprisonment for five years and a fine of ₹ 5,000. Appellant Charucharan Guha to rigorous imprisonment for three years and a fine of ₹ 2,500. 2. The charge of conspiracy related to the period from December 1, 1948, to January 31, 1949, and comprised in all eight persons of whom two Lala Shankarlal Hiralal Bansal (hereinafter referred to as Lala Shankarlal) and Saubhagyachand Umedchand Doshi (hereinafter referred to as Doshi) died before commencement of the trial. One Lala Ram Sharandas alias Ramsharan Lala Haricharan Mahajan (hereinafter referred to as Mahajan) was also a party to the conspiracy. But for some reas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erates to obtain the control of the Jupiter, which at the time was in a sound financial position, by acquiring the controlling block of shares of the Jupiter and utilising the funds of the Jupiter itself for the acquisition of such shares. 12. By the date of the conspiracy the Jupiter had investments of the face value of Rs. two crores. It had issued 1,24,966 ordinary shares of ₹ 100 each of which ₹ 15 per share was called up. It had also issued cumulative preference shares. Rai Bahadur Girdharilal Bajaj (hereinafter referred to as Bajaj) and Tulsiprasad Khaitan (hereinafter referred to as Khaitan) were at the time, i.e., in 1948, in control of the Jupiter. These persons owned through the New Prahlad Mills Ltd. the controlling block of shares of the Jupiter i.e., about 63,000 shares of the Jupiter, between themselves and their nominees. After negotiations, conducted first through certain persons called Mayadas and Chopra and then, through one Naurangrai, a bargain was settled with Khaitan for the purchase of this controlling block of shares at ₹ 53 per share for a sum of ₹ 33,39,000. Out of this amount a sum of ₹ 5,39,000 was to be paid over to Bajaj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Lala Shankarlal and, according to the prosecution, was a defunct organisation at the time. The plan envisaged by these resolutions was that cash was to be taken out from the Jupiter partly by sale of securities and partly by pledge of securities and that money was to be shown as having been a loan to Caveeshar on the security of his Delhi properties and a further amount as having been invested for the purchase of plots of the Delhi Stores. 14. Lala Shankarlal was to receive these amounts on behalf of Caveeshar and the Delhi Stores, and pay over the cash that would thus come into his hands to Bajaj and Khaitan as per the agreement. This appears - according to the prosecution case - to have been actually done in the following way. The safe custody account of the entire holdings of the securities of the Jupiter with the Bank of India was closed by a resolution of the new directors of the Jupiter dated January 11, 1949, and these securities were taken over into the personal custody of Mehta. Thereafter securities of the value of ₹ 30 lacks were offered for sale through a broker who ultimately could sell only shares of the value of ₹ 15 lakhs. For the remaining ₹ 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of funds of ₹ 5,39,000 on his executing a pro-note dated December 23, 1948, (Ex. Z-4) for the said amount in favour of the Tropical by two cheques signed by Lala Shankarlal, one for Rs. one lakh on December 22, 1948 (Ex. Z-1) and another for ₹ 4,39,000, dated December 23, 1948, (Ex. Z-3). These amounts were deposited by Naurangrai in his bank account with the Bikanir Bank at Delhi. On December 26, Lala Shankarlal and Naurangrai and Khaitan met at Bombay and further details were discussed on the 26th and 27th. Khaitan insisted on previous payment of ₹ 5,39,000. Lala Shankarlal asked for the list of securities and shares, the valuation report and the balance sheet of the Jupiter. Naurangrai returned back to Delhi, drew ₹ 5 lacks by way of cash from his bank account and paid there from a sum of ₹ 4,85,000 to Bajaj at Ghaziabad. He came back to Bombay and informed Khaitan of the same. Thereupon the agreement, Ex. Z-171, was executed on December 29, 1948. The agreement was to the following effect. 17. The Tropical was to pay the balance of ₹ 28,54,000 on or before January 20, 1949, and on such payment the Jupiter's shares numbering 63,000 were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dividually to operate upon all the banking accounts in the name of the company with all the banks. Three policyholder directors as also the general manager, Joel, resigned and their resignations were accepted. This was followed by another meeting of the new directorate on January 11. At that meeting the Board passed a number of resolutions about some of which there is considerable controversy and with reference to which there is the evidence of one Subramaniam for the prosecution. One of the undisputed resolutions of that meeting was to withdraw a letter written by the previous general-manager, Joel, dated January 3, 1949. By that letter (Ex. Z-30), Joel had written to the Bank of India, Safe Custody Department, instructing the bank that till further advice, they should not transfer any of the securities held by the bank on behalf of the company. On January 11, 1949, a copy of this resolution was sent to the bank under the signature of Mehta for their information. By another letter of the same date sent by the sub-manager, one Baxi, (Ex. Z-32) the bank was instructed to close the safe custody account and to hand over the entire holdings of the securities of the Jupiter to Mehta. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has been put in evidence. The demand draft was brought to Bombay and credited into the account of the Jupiter in the Currimjee House Branch of the Punjab National Bank at Bombay on January 18. Thus by the sale and the pledge of the Jupiter's own securities, a sum of ₹ 27,99,768 was raised and kept available for use. On January 19, Mehta wrote to the Punjab National Bank, Currimjee House Branch, Bombay, to pay a sum of ₹ 28,15,000 to the Bank of India where the New Prahlad Mills Ltd. (Khaitan) had got 61,394 Jupiter's shares lying case-credit account and to take delivery of those shares on behalf of the Tropical and to debit ₹ 28,15,000 from the Tropical account with them. 18. On the same date, Mehta, wrote also to the Bank of India, requesting it to deliver 61,394 shares of the Jupiter to the Punjab National Bank, Currimjee House Branch, Bombay, with relevant transfer deed against payment of ₹ 28,15,000 with reference to Khaitan's earlier instructions to the Bank by his letter dated January 3, 1949 (Ex. Z-44). On the 19th, Mehta issued a cheque for ₹ 75,000 on the Indian Bank, Tropical account and deposited the same in the Punjab Nation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and signed by Kaul on behalf of the Jupiter. All these five cheques were deposited into the Tropical account the Punjab, National Bank by a pay-in-slip dated January 20, 1949, alleged to be in the handwriting of Guha and signed by him on the 19th. The total of these cheques comes to ₹ 27,65,700. As a result of the pervious instructions given on January 19, by Mehta, to the Punjab National Bank, the Bank paid on January 20, a sum of ₹ 28,15,000, from the Tropical account to the Bank of India and took delivery of 61,394 shares of the Jupiter from the Bank of India and the Punjab National Bank then held those shares for the Tropical in the Tropical account Khaitan was paid on the last date stipulated. It would appear that including the 1,250 qualifying shares previously transferred, the shares transferred by Khaitan fell short of the 63,000 shares, by 356 shares, but the deficit appears to have been made up very shortly thereafter. 20. Now, according to the prosecution, this payment of the Jupiter's money for the purchase of the Jupiter's shares was by means of ex facie payment from funds of the Tropical in the Punjab National Bank which were brought up to the req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reement with Caveeshar by the managing director, Lala Shankarlal, on December 23, 1948, was confirmed. By resolution No. 14, plots of land and building in Chandni Chowk, Delhi, sold by the managing director, Lala Shankarlal, at a cost of ₹ 2,60,000 to the Delhi Stores, was approved and confirmed. It is alleged that the resolutions of the Jupiter at the meetings dated 11th and 20th above noticed and of the Tropical dated the 22nd disclosed the scheme of camouflaging which has been resorted to, to screen the fact that the payment for the purchase of the Jupiter's shares was directly out of the Jupiter's amount. 22. This according to the prosecution, indicates in its broad outline the manipulations resorted to for the above purposes. There is also evidence let in on behalf of the prosecution of a number of relevant details such as the presence or absence of the requisite entries and papers in the various books of account and other records of the concerned organisation, the Jupiter, the Tropical and the Delhi Stores. Evidence has also been given to show which of the accused was directly a party to which of the various steps. Direct evidence of some of the ex-employees ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncing from February, 1949, to the end of December, 1949. The background relating to this period, according to the prosecution is, that Lala Shankarlal and his other co-conspirators were fully aware of the necessity of showing the transactions of January, 1949, as no longer outstanding as early as possible, so as to escape direct scrutiny thereinto by the end of the calendar year and it is said that therefore they made some further manipulations with a view to show the moneys advanced to Caveeshar and the Delhi Stores as having been returned before the end of the year. The events which led up to this may now be noticed. On May 25, 1949, there was a meeting of the new directorate of the Jupiter at which Lala Shankarlal informed the directors that Caveeshar was repaying his loan of ₹ 25 lacks and odd and out of that amount a sum of ₹ 14 lacks might be invested in purchasing 40,000 shares of the Tropical and ₹ 11 lacks on the equitable mortgage of the Tropical's head-office building. Ultimately, however, this contemplated loan of ₹ 11 lacks to the Tropical on the equitable mortgage of its head-office building did not materials for one reason or other. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the debt owing from him to the Jupiter. The net result of these adjustments was that ₹ 4 lacks out of the Caveeshar loan with the Jupiter was shown as reduced. What became of the other Rs. one lakh is not quite clear. The next transaction is Caveeshar's fresh loan. At the same meeting of the Board of directors of the Jupiter dated November 5, 1949, whereas Raghavji's loan for ₹ 5 lacks was sanctioned, a further loan of ₹ 5,30,000 was authorised to be advanced to Caveeshar against pledge of shares of the People's Insurance Co., the period of repayment being mentioned a two years. This transaction merely meant a book adjustment reducing the loan outstanding against Caveeshar and a fresh loan to that extent on a different security. This transaction further reduced the original indebtedness of Caveeshar to the Jupiter by this amount. The third item is the Misri Devi loan. At a meeting of the Board of directors of the Jupiter dated December 20, 1949, an application for loan of ₹ 5 lacks from Misri Devi shown as the daughter of Lala Dwaraka Das (though she was also the wife of Lala Shankarlal) was said to have been considered and a loan in he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 28,15,000 to Khaitan on January 20, 1949, the original source of cash, according to the prosecution case, was the sum of ₹ 25,15,000 granted by way of loan to Caveeshar and ₹ 2,60,000 paid to the Delhi Stores for purchase of plots of the Delhi Stores. Out of this the original Caveeshar loan was, by the end of 1949, shown as having been completely wiped out as above stated. So far as the purchase of plots of the Delhi Stores is concerned, it would appear that though in fact the Delhi Stores had no such plots to sell, this transaction was shown as put through in the following way. The resolution of the Board of directors of the Tropical dated January 22, 1949, showed certain plots of land and the building in Chandni Chowk, Delhi, belonging to the Tropical, as having been sold to the Delhi Stores for the price of ₹ 2,60,000. Putting these two resolutions together, it would appear that the drawing out of ₹ 2,60,000 from the Jupiter's funds by virtue of the relevant resolution dated January 11, 1949, was substantially the payment of ₹ 2,60,000 by the Jupiter for the alleged purchase of plots of land and building in Chandni Chowk which belonged to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o purchase the controlling block of shares of the Empire of India Life Assurance Co. Ltd. and the second offering to bring about a settlement in connection with the claim by Chopra and Mayadas for commission relating to the purchase of the Jupiter's shares. 28. Third period : During the year 1950. 29. The events of the third period as alleged by the prosecution and in respect of which the prosecution has given evidence may now be stated. The main argument on behalf of the appellants before us relates to the admissibility of the evidence relating to this period. The background for the events of this period was - according to the prosecution - the situation that arose from the strong attitude taken by the auditors in the course of their audit of the affairs of the Jupiter for the year 1949, which was taken up at the commencement of 1950. The transactions of the Jupiter during the year 1949 which came under their scrutiny are said to have aroused their concern and this led them to probe into the circumstances relating to the original Caveeshar loan in January, 1949, to the tune of ₹ 25,10,650. On January 6, 1950, the auditors sent a letter to the Jupiter demanding inspect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ri Devi loan and (4) purchase of the Tropical shares. 31. Repayment of Caveeshar fresh loan of ₹ 5,30,000 to the Jupiter, was done by raising money by sale of the Tropical securities and paying that money to the Jupiter in discharge of Caveeshar's fresh loan. It appears that the Tropical securities of the face value of ₹ 6 lacks were pledged with the Grindlays Bank, New Delhi, for an overdraft account of the Tropical. It is said that these Tropical securities were got released from the Grindlays Bank by substituting for them the Jupiter's securities of the face value of ₹ 5,30,000. The prosecution case is that Kaul, lifted these Jupiter's securities and gave them to Mehta and that Mehta flew of Delhi, handed over these securities to the Grindlays Bank (presumably as belonging to the Tropical) and got released the previously pledged Tropical securities. The Tropical securities so released appear to have been sold on September 12, 1950, and to have realised ₹ 5,01,592-1-2. That amount is said to have been deposited in the Tropical's account with the Indian Bank. On September 14, Mehta is said to have drawn a cheque for ₹ 5,30,000 on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advance to Ramratan Gupta and another sum of ₹ 33 lacks and odd within thirty days thereafter and the controlling block of shares of the Empire of India of 2,618 were to be handed over to one Damodar Swarup Seth, a nominee of Lala Shankarlal. This amount of ₹ 43 lacks and odd is said to have been paid up by means of a number of cheques as follows : I.On October 5, 1950 - (i) Cheque by Damodar Swarup Seth (Ex Z-10) for 8,00,000 (ii) Cheque by Bhudev Sanghi in favour of Damodar Swarup Seth (Ex. Z-11) for 2,00,000 Total of I 10,00,000 II. On October 16, 1950, six cheques by Damodar Swarup Seth in favour of - (i) Reyer Mills Ltd. for 10,55,844 (ii) Laxmi Ratan Cotton Mills for 8,06,895 (iii) Premkumar Gupta for 6,71,787 (iv) Stores India Ltd. for 36,799 (v) Gulabchand Jain for 97,500 (vi) Biharilal Ramcharan for 5,04,072 III. On October 27, 1950 - (i) Cheque by Damodar Swarup Seth(Ex. Z-13) for 2,08,650 Total of II & III 33,81,547 34. The total of the first two cheques is ₹ 10 lacks which was paid as advance. The total of the remaining seven cheques comes to ₹ 33,81,547 which was shown as consideration for the purchase of 2,618 shares ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into the Jupiter account with the Punjab National Bank, Bombay, on October 26 itself showing the same as the sale proceeds of 54,000 Tropical shares which the auditors had objected to as being an unconscionable investment. The actual payment was made into the Jupiter account of the Punjab National Bank, Bombay, by one Bhagwan Swarup and another Bhudev Sanghi. A letter was obtained, singed by Bhudev Sanghi (a nephew of Lals Shankarlal) (Ex. Z-152) that 54,000 Tropical shares belonging to the Jupiter were sold by him as a broker, and that the sale proceeds thereof were credited that day into the account of the Jupiter in the Punjab National Bank at Bombay and the corresponding entries were made in the investment register of the Jupiter. It is said that notwithstanding this transaction the Tropical shares remained in the safe custody account of the Jupiter in the Bank of India right up to January 2, 1951, when on receipt of a letter dated January 2, 1951 (Ex. Z-293) by Kaul to the Bank of India, they delivered all his shares. These Tropical shares appear to have been deliver over to a clerk of the Jupiter and handed over by him to Guha. It is said that these shares are now no longe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon. On October 16, entries were made in the cash book of the Jupiter showing that the loan of Misri Devi for ₹ 5 lacks with interest was recovered. The excess payment of ₹ 31,937-8-0 was shown in the first instance as credited to suspense account and thereafter as having been refunded to Misri Devi on October 18. Thus the Misri Devi loan was shown in the books as having been also completely repaid. 37. Thus by these various adjustments and manipulations, the four transactions, viz., (1) Caveeshar fresh loan on the security of the Peoples Insurance Company's securities, (2) Raghavji's loan on the security of his properties in Cutch, (3) Misri Devi's loan on the security of her building in New Delhi, and (4) purchase of 54,000 Tropical shares by the Jupiter, which were all strongly objected to along with the original Caveeshar loan of ₹ 25 lacks and odd, were shown as realised back in actual cash by October 27, 1950. A letter was then written by the solicitors of the Jupiter under instructions of Kaul to the auditors to attend on October 28, 1950, at the office of the Jupiter and to verify the accounts and moneys received from the repayments of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ares were transferred in the name of the Tropical and two further lost of 4,475 each were transferred in the names of Lala Shankarlal and Caveeshar. On September 13, 1950, out of the lot of 37,949 shares standing in the name of the Delhi Stores, 4,000 shares were kept standing in the name of the Delhi Stores and the balance of 33,949 were distributed as follows : 3025 shares in the name of Lala Shankarlal 3025 shares in the name of Caveeshar 50 shares in the name of Kaul 7075 shares in the name of Mehta 7500 shares in the name of Chandulal Ratanchand Shah, an employee of the Tropical 7500 shares in the name of Himatlal F. Parikh, an employee of the Tropical 5774 shares in the name of Himatlal Harilal Shah. 40. Out of the lot of 14,601 shares kept in the name of the Tropical 7,500 shares were transferred to the name of one Baburam and 7,101 shares were transferred to the name of Kaul. Out of another lot of 409 shares which were purchased, 339 shares were transferred to the name of Kaul. Thus the position of the distribution of the purchased Jupiter's shares as on September 13, 1950, was as follows : 7750 shares in the name of Lala Shankarla 7740 shares in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art of 1949. Mr. Chari contends that on the substantive charge of conspiracy all these steps or actings are not admissible in law. 44. Now the conspiracy as charged is in substance a conspiracy to commit criminal breach of trust in respect of the funds of the Jupiter by utilising the same to purchase the controlling block of shares of the Jupiter itself for the benefit of the Tropical (or for the benefit of the conspirators). This conspiracy is alleged to have been entered into between the dates December 1, 1948, and January 31, 1949. Mr. Chari says that primarily it is only the events of that period comprising the acts, writings and statements of the various conspirators of that period which would be admissible as against each other under s. 10 of the Indian Evidence Act, 1872 (I of 1872). According to the prosecution case the modus operandi was to screen the utilisation of these funds by showing them as having been advanced for legitimate purposes and invested on proper security, but in fact utilising the same for payment to the owners of the controlling block of shares of the Jupiter. Mr. Chari says that strictly speaking, though for this purpose, only the acts, writings and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the various transactions on which the prosecution relies to make out its case, and having regard to the fact that this was a jury trial, every attempt should have been made to exclude material which is strictly not admissible in law. Otherwise it would have the effect of confusing the jury and prejudicing its mind. But if the evidence is clearly admissible in law, the Court would not be justified in declining to receive it. All that can be said is that it would have to take every care in charging the jury to place fairly before it the effect and implications of such items of evidence in an adequate measure. 45. The limits of the admissibility of evidence in conspiracy cases under s. 10 of the Evidence Act have been authoritatively laid down by the Privy Council in Mirza Akbar v. The King-Emperor (1940) L.R. 67 I.A. 336. In that case their Lordships of the Privy Council held that s. 10 of the Evidence Act must be construed in accordance with the principle that the thing done, written, or spoken, was something done in carrying out the conspiracy and was receivable as a step in the proof of the conspiracy. They notice that evidence receivable under s. 10 of the Evidence Act of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd half of 1949 by utilising the money of the Empire of India after obtaining the control thereof, and by wrongfully utilising the Jupiter's securities, would also be relevant to make out and emphasize the bogus character of the original debts. It cannot be said to be too remote because it is to be remembered, as has been pointed out by Mr. Khandalawala, that the urgent necessity for acquiring the control of the Empire of India in 1950, and for utilising it for showing the alleged investments of the second half of 1949 as having been realised back in cash in 1950, arose on account of the firm attitude of the auditors who suspected the bona fides of the original Caveeshar loan and of the connected transactions of the second half of 1949 when they scrutinised in 1950 the affairs of the Jupiter for the year 1949. The 1950 transactions appear clearly to have been brought about not merely to screen the transactions of the second half of 1949, but equally, if not mainly, to dispel any suspicion, and to obviate the scrutiny, in respect of the earlier transactions of January, 1949, which related to the period of conspiracy. Thus in relation to the main purpose of the prosecution, vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h is admissible as against himself. Mr. Chari for the appellants contests this assumption and urges that the evidence that has been admitted of the year 1950 is much wider than what is covered by the above two and that it was in fact and in substance evidence of the acts, writings and statements of individual conspirators of a period outside the period of conspiracy, and treated as admissible against other co-conspirators, on the central issues in the case, viz., whether a conspiracy has been made out and whether the individual accused were participants in that conspiracy. Mr. Chari very strenuously contends that such evidence was inadmissible and that its admission has seriously prejudiced the case of appellants and has rendered any fair and rational consideration of the case by the jury extremely difficult, if not impossible. In particular his strong objection was to the evidence relation to the acts, writings and statements of Lala Shankarlal of the year 1950, more particularly because he died before the trial and was not before the Court on trial as a conspirator. His contention raises for consideration two questions, viz., (1) whether such evidence is admissible in proof o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tself to enable us to see for ourselves what it relates to, since it was exhibited only in the committal court in ruled out at the trial. But there is no difficulty in appreciating what the learned trial Judge actually held. That the learned trial Judge acted on this view is reasonably clear also from the fact that in quite a number of places in his charge to the jury he has repeatedly emphasised that subsequent conduct of a conspirator would not be admissible against anybody else but himself. (See paras 453, 541, 557, 588, 602, 657, 676, 685 and 689 of the learned trial Judge's charge to the jury). No doubt in some of the paragraphs previously noticed as having been objected to by Mr. Chari, the very reference to acts and conduct of Lala Shankarlal during the year 1950 which is beyond the period of conspiracy, may conceivably be capable of being wrongly relied on by the jury in respect of issues on which they are not admissible and might be capable of producing some prejudice. But this is a possibility inherent in such cases has been pointed out by the Privy Council in Walli Muhammad v. King (1948) 53 C.W.N. 318. Therein their Lordships pointed out the difficulty in all cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : "In this manner, all the observations which the learned Judge made in paragraphs 11, 73, 74, 75, 94, 101 and 388, to which Mr. Chari has objected on the ground of inadmissibility, would be relevant to show that there was a conspiracy in this case and that Lala Shankarlal was a party to it." 53. That the learned trial Judge appears to have taken the opposite view is reasonably clear from his ruling (interlocutory judgment No. 6) dated August 22, 1955, already referred to, relating to the admissibility of the document, Ex. Z-71, in the committal court. In that order he sets out the arguments of both sides as follows : "It is common ground that the action of any of the accused person subsequent to the period of conspiracy is admissible in evidence against that particular accused person only. Mr. Khandalawala, therefore, argues that the actions of Lala Shankarlal, of Doshi and of Mahajan subsequent to the period of conspiracy are admissible in evidence to prove that they were party to the conspiracy alleged in the case and to prove their guilt individually along with the accused persons ....... He further submits that s. 10 of the Indian Evidence Act is permissive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that decision. In the said case their Lordships of the Privy Council elucidated the principle of admissibility of evidence in cases of conspiracy by reference to the English leading case of The Queen v. Blake (1844) 6 Q.B. 126; 115 E.R. 49. That was a case in which two persons, T. and B., were charged for conspiracy to cause certain imported goods to be carried away from the port of London and delivered to the owners without payment of the full customs duty payable thereon. T. did not appear and defend. B. pleaded not guilty. At the trial it was proved that T. was agent for the importer of the goods, B. was a landing waiter at the Custom House. It was T.'s duty to make an entry describing the quantity etc. of goods. A copy of such entry was delivered to B. who was to compare this copy with the goods, and, if they corresponded, to write 'correct' on T.'s entry, whereupon T. would receive the goods on payment of the duty according to his entry. It was proved that T.'s entry was marked 'correct' by B. and corresponded with B.'s copy and that payment was made according to the quantity there described, and that the goods were delivered to T. Evidence w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow far it could be used as evidence of the conspiracy and of the fact that the others were co-conspirators. Their Lordships held as follows : "We have come to the conclusion that the statement of Abani cannot properly be treated as evidence under section 10 of the Evidence Act. That section, in our view, is intended to make evidence communications between different conspirators, while the conspiracy is going on, with reference to the carrying our of the conspiracy." 57. It may be added that this statement was merely treated as a confessional statement falling within the scope of s. 30 of the Evidence Act and usable only as such against the co-accused. The case in Emperor v. G. V. Vaishampayana I.L.R. (1931) Bom. 839 was also a case of conspiracy in which an approver as co-conspirator gave evidence. He gave evidence of statements, made of him by another co-conspirator by name Swamirao who was not an accused before the Court, which had reference to the alleged attack on the Lamington Road police station which was the object of the conspiracy. These statements were alleged to have been made after the return of the attacking party to the approver at his residence. Objecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at what is sought to be admitted in such a case is, something said, or done, or written by any one of the co-conspirators behind the backs of the others as being in law attributable to the others and what is sought to be proved by such evidence taken by itself is the existence of the conspiracy as between the alleged conspirators and the fact that a particular person was a party to the conspiracy. It is such evidence that is inadmissible otherwise than under s. 10 of the Evidence Act. Quite clearly, in the normal class of cases, such evidence is admissible as against himself and not against others, excepting where there is relationship of agency or representative character or joint interest. (See s. 18 of the Evidence Act). In civil cases it is well settled that a principle is bound by the acts of his agent if the latter has an express or implied authority from the former and the acts are within the scope of his authority. Therefore acts of an agent are admissible in evidence as against the principal. An analogous principle is recognised in criminal matters in so far as it can be brought in under s. 10 of the Evidence Act. It is recognised on well established authority that the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uenced by any fact in issue or relevant fact." 61. This appears clearly to rule out the conduct of Lala Shankarlal, Doshi, and Mahajan behind the backs of others as inadmissible. Such conduct would be admissible only to the extent that it is permissible under s. 10 of the Evidence Act, if it is the conduct of a co-conspirator whether he is alive or dead and whether on trial before the court or not. Mr. Khandalawala in his arguments against this view has suggested some hypothetical cases to show the difficulties that may arise on such a view. But a close consideration of these suggested hypothetical cases does not show that they raise any serious difficulties. It is unnecessary to notice them at any length. 62. The learned Judges of the High Court (in reliance on certain English decisions which, with respect, do not appear to have any direct bearing on the question at issue) were of the opinion that since a person's conduct is admissible against himself without the limitations of s. 10 of the Evidence Act, the conduct of Lala Shankarlal would be admissible to show that there was a conspiracy and that he was a conspirator in it. It appears, with great respect, that this re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t point that is urged is that a number of documents put in evidence which are said to be in the handwriting of one or other of the accused were sent to a handwriting expert for his opinion and that the expert was not called as a witness on the prosecution side, nor was his report exhibited, but the jury was asked to compare the handwritings in the disputed documents with the admitted handwritings and to form their own conclusions. It is urged that this was not fair and that the prosecution was bound to examine the handwriting expert and exhibit his report. It is well settled, however, that the Court cannot normally compel the prosecution to examine a witness which it does not chose to and that the duty of a fair prosecutor extends only to examine such of the witnesses who are necessary for the purpose of unfolding the prosecution story in its essentials. (See Habeeb Mohamed v. The State of Hyderabad (1954) S.C.R. 475. Mr. Khandalawala appearing for the prosecution states that the examination of the handwriting expert was not in any sense necessary in this case for unfolding the prosecution case and we are inclined to agree with him. Even if a different view is to be taken as to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase and that this is not permissible in law. This argument has a bearing both on the general case against all the accused and also on the case against appellant Caveeshar. It has reference to the following portion of the prosecution case. It is to be recalled that the original loan of ₹ 25 lacks and odd from the funds of the Jupiter to Caveeshar on the alleged security of his supposed properties in Delhi was, according to the prosecution case, sought to be supported by the conspirators by certain appearances, viz., an application for such a loan, a valuation statement of the alleged properties and other necessary papers and also by certain resolutions Nos. 5, 6, 7, and 8 of the directorate of the Jupiter at its meeting dated January 11, 1949, sanctioning such loan on the basis of such papers. The prosecution case appears to be that as a fact these papers were non-existent and the resolutions Nos. 5, 6, 7 and 8 were not in fact passed, on the date when, according to the present appearances in the minutes books, the matter was taken up for consideration by the Board of directors at its meeting of January 11, 1949. For this purpose they rely amongst other things on the evidenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in this behalf are not acceptable. The alternatives presented for the prosecution are not in any sense the presentation of any inconsistent cases. Doubtless the prosecution cannot be permitted to lead evidence relating to inconsistent case. But so far as we have been able to apprehend that is not what has been done in this case. We are, therefore, unable to see any substance in this contention. It may be noticed in this context that none of the documents connected with this Caveeshar transaction are now available. Indeed that was the position also even by the time when the auditors wanted to see those documents in the year 1950 the explanation of the directors at the time being that since that loan to Caveeshar was discharged by him by complete payment all the relevant documents had been returned to him. Of course, the case of Caveeshar himself is that he was not a party to the alleged loan and that he was not aware of any such documents and that the manipulations, if any, were behind his back. 68. Mr. Chari next complains about what he says is a serious mis-direction to the jury inasmuch as the learned Judge asked the jury to ignore the fact that by the time the complaint was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r-book containing the judgment of the High Court. Mr. Khandalawala appearing for the prosecution points out to us that these alleged irrational features have been dealt with by the learned trial Judge in his charge to the jury then and there with reference to each particular item of evidence when it had to be referred to in the context of the general narrative or the narrative as against each individual accused. All that can be said is that the learned trial Judge has not once again repeated the same when drawing the attention of the jury to this specific argument of Mr. Chari, who appears to have stressed them in a general sweep by clubbing these together as being thirty irrational features. We agree with the High Court that there is no reason to think that the somewhat summary way in which the learned trial Judge dealt with this in para 556 of his charge to the jury can be taken exception to in the circumstances of the case being any material non-direction. 70. A special argument has been advanced on behalf of the appellant Caveeshar that he was not a director of the Jupiter and was not present at any of the meetings of the conspirators as directors of the Jupiter and that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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