N. R. M. Chettiar v. Darley, Butler & Co.
1932Present: Akbar J.
N.R. M. CHETTIAR v. DARLEY, BUTLER & CO.
In revision, P. C. Colombo, 39,029 and 39,030.
. Search warrant—Powers of Police Magistrate to issue for investigation ofoffence—Prima facie proof of offence—Criminal Procedure Code, s. 68.
The powers of a Police Magistrate to issue a search warrant for theinvestigation of an offence can be exercised only when the offence hasbeen disclosed prima facie by legal evidence on record.
PPLICATION to revise an order made by the Police Magistrate ofColombo.
The petitioner indented for 2,800 bags of rice of the value of Rs. 22,450from respondents, Darley, Butler & Co., “ on a promissory note of12th April, 1932, on the usual 45 days’ credit, ” and “ bills of lading werehanded to petitioner to enable him to take possession”. Meanwhilerespondent learned that petitioner had decamped and that his firm wasin a bad way financially. Respondent sought to obtain recovery of therice by a search warrant, duly issued by the Police Magistrate.
In P. C. 39,030 respondent deposed to criminal breach of trust bypetitioner in that latter had been given a number of bags of rice forstorage as respondent’s agent. Part of the contract was that petitionerwas to pay Customs and other landing dues, which the petitioner wasat liberty to recover from respondent subsequently.
H. V. Perera (with him Canakeratne and Nadarajah), for petitioner.—There is insufficient material to authorize a search warrant in anycircumstances; search-warrant mode of process is incidental to a criminaltrial; a search warrant cannot be given to enable persons to recovermovables in possession of another.
The form of warrant is questionable, see Criminal Procedure Code,section 413. The law does not authorize a person to go into a PoliceCourt and get a search warrant on an ex parte application. Complainantswears to certain facts in Police Court, a good deal of which is hearsay.After conviction, Police Magistrate has right to deal with productions ashe thinks fit. Custody is always temporary, pending investigation ofsome matter as to whom property is to go (Silva v. Hamid1). PoliceMagistrate cannot take ownership from one man and give it to another.His jurisdiction is normally criminal; any other jurisdiction is undersection 413, of Criminal Procedure Code. Only other jurisdiction, notcoming under section 413, is to restore the status quo. The evidence ledalso shows a civil liability on a promissory note. It is for PoliceMagistrate to judge whether there has been cheating prior to transactionre movables ; in such case there must be the elements of cheating. ACourt has no right to act on hearsay evidence even in an ex parte.application (Police Sergeant, Tangalla v. Porthenisr).
The law applicable is same as in 39,029. There is hearsay evidencehere also. Customs dues and landing charges were paid by petitioner.The guarantee broker was in fact agent between respondent andpetitioner. Petitioner submits there was a bona fide sale of rice bags..
1 20 N. L. R. 414.. ."2 22 N. L. It. 163.
AKBAR J.—N. R. M. Chettiar v. Parley, Sutler & Co.
The matter reached finality in the Police Court when Police Magistratemade order and proctor made his statement. No complaint undersection 148 at all. Complaint must be on oath and signed : section 149.Section 150 requires writing. If section 68 applies it does so only withregard to something required for investigation ; here the rice has no bearingon the case. The section applies where thing itself is evidence. Thefunction of Police Magistrate is to find if an offence has been committed.This follows logically from section 66, as it deals primarily with documents.Section 70 applies to a place used for keeping stolen property. No orderunder section 70 can be made unless Police Magistrate has certainevidence before him.
A search warrant is permissable only when a thing cannot and will notbe produced otherwise. Indian Criminal Procedure Code, section 96, issimilar on this point.1 The issue of a search warrant is a judicial actafter a judicial inquiry. However large Police Magistrate’s discretionmay be, it can apply only within limits laid down by law. * It is not ageneral search, because thing to be searched for has been specified. PoliceMagistrate must have minimum prima facie case prior to issue of warrant.Broker’s acceptance of cheque is sufficient to constitute sale.
Keuneman (with him N. E. Weerasooria), for respondent.—Petitioner-cheated respondent by not disclosing the fact that he was insolvent attime of making note. Hearsay evidence deals mainly with fact of peti-tioner’s absence. Property in rice had passed to petitioner. Rice beingperishable, respondent wants order for sale and to bring money into Court.
Petitioner was respondent’s agent and criminally misappropriatedgoods given, viz., bags of rice. No formal denial that the place in ChalmersGranaries closed for two days. Alleged sale is on the 9th, hence documentmust necessarily be drawn up on the 9th. Correspondence conclusively. shows respondent was still negotiating with M. S. W. Abdul Ally. Ifcheque was presented for payment at any time, sale would have beencompleted. Search warrant was asked for and given as step in prosecutionas a*whole. Rice is now being kept as security, until civil action is institutedand decided (Sub-Inspector of Police v. Ram Menika'). Magistrate’spower of receiving sufficient evidence is discretionary. The orders werecorrectly made at stages when they were made. Where Police Magistratehas made no order subsequent to refusal, petitioner cannot come toSupreme Court. No question of revision arises.3 In re Application ofAbdul Latiff under section 148, certain evidence has been called and thenrespondent can fall back on section 68 or 70 (a) or (c)?/ Search warrantmay be granted if Police Magistrate suspects somebody has done away withs something (Queen Empress v. Tirupati*). Followed by Privy Council inClarke v. Chowdhurya.
June 21, 1932. Akbar J.—
These two cases were argued together. In P. C.'39,029 the respondentwho said he was a director of the firm of Messrs. Darley, Butler & Co.,Btd., stated on oath on April 22, 1932, that his firm imported rice on
V i 15 Cal. 109.* 15Calcutta 109.
2 8 C. L. R. 98.5 3Madras 18 atp. 20.
-1 29 N. L. R. 34G.« 39Calcutta 953.
AKBAR J.—N. R. M. Chettiar v. Darley, Butler & Co.
indent for other firms in Ceylon and that the petitioner indented 2,800bags, value Rs. 22,540, which arrived on April 12, 1932. The petitionerhanded the respondent “ a promissory note on the 12th of April, 1932,on the usual 45 days’ credit ” and “ bills of lading were handed to theaccused to enable him to take possession The respondent went on tosay that he had learnt on April 21 that the petitioner had closed hisbusiness ; that he had failed in his business and that he had disappeared.
– Further, his broker had searched for the petitioner and his whereaboutswere not known. The respondent further gave it as his opinion that thepetitioner “must have known on 12th April, 1932, that he was in thisbad financial position and he had no business to take our rice or give thispromissory note ”.
If the respondent’s firm had known his position the respondent would' not have delivered the rice. He claimed he had the right to stopdelivery. He could not say where the bags were—they were all markedD: B. & Co., Ltd., N.R.M.N., Colombo. He moved for a search warranton Nos. 115-118^ Chalmers Granaries. His firm would guarantee any_ cost in connection with the removal of the rice on a search warrant.This 'wa$ ah the evidence led.
According- to the evidence, it was quite clear that the transaction wasone of sale and that the property in the' rice had passed to the petitionerimmediately the bills of lading were given over to the petitioner and thepromissory note accepted by the respondent. The respondent claimed theright to stop delivery of the goods after the possession had passed to thebuyer on a completed transaction of sale. The respondent claimed thisright because he had learnt certain things on hearsay and his broker (whowas not called) had failed to find the accused. On the date on which therespondent moved the Police Court for a search warrant the promissorynote was not due for another 35 days. Because the respondent hadlearnt certain things from certain persons not called, he was of the opinionthat the petitioner should have known on April 12 of his bad financialcondition and the petitioner had no business to take the rice and give thepromissory note. Upon this evidence the Police Magistrate immediatelyissued a search warrant to seize the bags of the rice with the marks
B. & Co.-, Ltd., N.R.M.N: on the named premises and to remove themto the respondent’s store, returnable on April 25, 1932. The searchwarrant was executed and 1,111 bags were found. On the returnabledate the proctor for the petitioner moved that petitioner’s property bereturned to him as the warrant was issued illegally. The learned PoliceMagistrate refused this application, when the proctor for the respondentstated that he was satisfied with the return of the bags and did not wantto prosecute the case. The petitioner then stated that he was applyingto this Court for revision of the proceedings. I may add that the learnedPolice Magistrate did not state in his order the section under which hepurported to-act nor the offence for an investigation of which he thought -the production of the bags of rice was necessary, but the clerk whodrew up the search warrant has stated in the warrant that the offencedisclosed was that of cheating and the warrant has been signed- by tbfcPolice Magistrate on this footing.
AKBAR J.:—N. R. M. Chettiar v. Darley, Butler & Co.
Petitioner naturally complains that the warrant was illegally issuedbecause the property had passed to him, he having cleared the riceafter paying Customs charges and because there was no evidence toprove a charge of cheating, the statement recorded on this point being-all hearsay and inadmissible. Further, the complainant had to leadevidence that the petitioner had the intention to cheat on April 12, andthe resjaondent’s opinion, however eminent the position of the respondentmay be in commercial circles, was not worth the paper it was written on,in criminal proceedings. He had to place facts to satisfy the Court.
I do not wish to say anything further on this aspect of the case, becausethere will no doubt be other developments arising from this motion forrestoration of property the title to which had passed from the respondentexcept to mention two other matters. Counter-affidavits were put inby the respondent and his broker at the hearing of this application,which I have read as they were not objected to, but I still think noiurther facts have been disclosed to show that the charge of cheating hasbeen made out. I may be wrong ; and I do not wish to prejudice therespondent further by giving my views on the further contention of thepetitioner’s counsel that the object of the respondent was not to chargethe petitioner with any offence, but merely to exercise his right to stopdelivery of goods which had already been delivered to the purchaser andthe purchase price of which was not yet due according to the terms of thecontract of sale and that the respondent had abused the process of acriminal Court instead of filing papers for a mandate of sequestrationbefore judgment, in a District Court and giving proper security to meeta possible claim of damages. I do not wish to prejudice the respondentas I have said because Mr. Keuneman’s argument was that his client’sintention was to prosecute the petitioner on a charge of cheating andnot to recover property. If that was his client’s intention he may stillcarry it out, for a charge of cheating in respect of goods of the valuedisclosed in this case is non-summary and non-compoundable. But theissue of the search warrant was clearly illegal at this stage of the case,if it was a case, for the reasons given by me. How a production of thebags in this case was going to help the complainant to prove his chargeof cheating I cannot see at present. My order is that the issue of thesearch warrant on April 22, 1932, was illegal and the bags of rice will berestored to the petitioner on receipt of this order by the Police Magistratewith liberty to the respondent to proceed on with his charge of cheatingif so advised before another Police Magistrate in spite of the admissionof the proctor for the respondent on April 25, 1932, that he was satisfiedwith the return, of the bags and that he did not want to prosecute thecase.
P. C. 39,030. ..In, this case the facts are slightly different. On April 22,1932, the respondent, deposed to the offence of criminal breach of trust byhis agent, the petitioner. He definitely stated that the bags of rice wereentrusted to the petitioner for storage until sale by the respondent. Ifthis is true the,title was in the respondent. The respondent then, it istrue, went on to give hearsay evidence that the petitioner “ had gone
AKBAR J.—N. R. M. Chettiar v. Darley, Butler & Co.
broke and had decamped ”—that is what he heard. He again reliedon the allegation that his guarantee broker could not find the petitionerbut the broker was not called to give evidence. In the affidavit of thepetitioner before me he contended that there was a sale and he referredto a cheque given by him to the broker to which no reference was madeby the respondent in his evidence, but which he now admits was receivedby his broker in his counter-affidavit. The respondent however statedin this affidavit that the broker had no authority to receive the chequeand that it was not accepted by him. It is also true that the petitionerreferred to the fact now admitted that the petitioner had paid overRs. 2,000 as the Customs duties, but according to the respondent thispayment was part of the contract of storage,and the petitioner had theright to recover this sum from the respondent. Whatever the truthmay be, I think justice requires that the respondent should be givena chance of substantiating his charge of criminal breach of trust and thathe should not be prejudiced in the meantime, because his counter-affidavit has disclosed certain further facts which are disputed by thepetitioner. Even in this case the Police Magistrate issued the searchwarrant on hearsay evidence and the search warrant mentions the offenceof cheating as the offence disclosed, whereas the offence if it is one iscriminal breach of trust by an agent, which is a non-summary and non-com poundable offence.
When the search warrant was executed 1,282 bags were found insteadof 1,400 bags cleared; so that if the charge can be made out 118 bagshave been misappropriated. The issue of the search warrant, if thecharge can be made out, has disclosed the extent of the misappropriation,if it is a misappropriation.
According to the local case of In re Adbul Latif1 a Police Magistratehas wide powers under section 68 of the Criminal Procedure Code toissue a search warrant for the purpose of the investigation of an offencewhich has been disclosed -primd facie by legal evidence on record. Theonl5r difficulty I had was that the greater part of the evidence on recordwas inadmissible but the counter-affidavits which were riot objected tofill the gaps to some extent if they are believed and. I think that this caseshould be further investigated.
The Indian cases too on a similar section of- the Criminal ProcedureCode indicate that a Magistrate has large powers to issue search warrantsin certain circumstances during the investigation of offences (see QueenEmpress v. Mahant; In re Ahamed Mohamed/ and the Privy Councilcase, Clarke v. Chowdhury J).
My order will be that this case will go back for inquiry before anotherPolice Magistrate, provided that the respondent will take steps to proceedori with this case within 7 days of the receipt of the record in the PoliceCourt. If he does so the rice will remain with the respondent withliberty to him to apply for a sale of the rice on the ground of deteriorationof quality by public auction, the nett proceeds to be deposited in Court
1 19 N. L. R. 346.3 I.' L. R., 15 Calcutta, p. 109.
= I. L. R., 13 Madras, p. IS.4 I. L. R., 39 Calctitta, p. 903. .
to the credit of the case and to abide the further orders of the Court.If the respondent does not take the necessary steps to continue this casewithin the time named by me the rice will be restored to the petitioner.
N. R. M. CHETTIAR v. DARLEY, BUTLER & CO.