What is Criminal Breach of Trust
Table of Contents
Chapter XVII, encompassing Sections 378 to 462 of the Indian Penal Code, 1860 (“IPC”), is dedicated to offenses against property. The IPC defines criminal breach of trust in Section 405, while Section 406 outlines the corresponding punishment. Sections 407, 408, and 409 of the IPC specifically address criminal breach of trust by carrier, criminal breach of trust by clerk or servant, and criminal breach of trust by public servant or by banker, merchant, or agent, respectively. Breaking down the phrase, we can dissect its components to understand the meaning of each individual word.
“Criminal” refers to actions that are prohibited by law, indicating conduct that is either legally forbidden or morally wrong.
“Breach” signifies a violation of something, be it a promise, a code of conduct, or, in the context of criminal breach of trust, a violation of trust.
“Trust” is the confidence or belief in someone’s character, ability, strength, or truth. In the legal context, it involves a fiduciary relationship where one party places confidence in another, and a breach of trust occurs when that confidence is violated.
What is criminal breach of trust
In simple terms, a criminal breach of trust occurs when one person entrusts their property to another (the accused), and the latter breaks that trust with a dishonest intention, turning it into a criminal act. For instance, if person A gives their bicycle to person B for repair, but B uses it for personal reasons, the breach of trust by B is deemed a criminal offense.
It’s crucial to note that the legal section specifically addresses ‘property,’ which can be either movable or immovable. The Supreme Court, in the case of R.K. Dalmia v. Delhi Administration (1962), clarified that the term ‘property’ in Section 405 IPC has a broad interpretation, encompassing both movable and immovable property.
The term ‘entrust’ holds significant importance in this context. It involves handing over a property to another person for specific reasons. However, it’s essential to understand that entrusting confers only limited rights to the other person; it doesn’t grant them ownership rights over the property. They may have substantial control over the property but cannot become its lawful owners. The entrusted property can be misappropriated, converted, used, or disposed of.
Section 405 IPC addresses criminal breach of trust committed by a person concerning entrusted property, whether movable or immovable. This person, having been entrusted with or having dominion over the property, dishonestly uses it for personal gain, misappropriates it, or disposes of it contrary to legal directions or contractual agreements related to the discharge of the trust. If another person is allowed to do so willfully, it also constitutes a criminal breach of trust.
Illustration:
- If an officer (A) entrusted with public money dishonestly uses it for personal purposes, it constitutes criminal breach of trust. Similarly, if A entrusts his furniture to B, who owns a furniture shop for repair while he is away, but B dishonestly sells the furniture, B is considered to have committed a criminal breach of trust.
Punishment under the law for the offence of criminal breach of trust under Section 405 IPC
The punishment for criminal breach of trust involves imprisonment for a duration of 3 years, a fine, or both. This offense is non-bailable, cognizable, and falls under the jurisdiction of a first-class Magistrate.
Section 407 IPC
Section 407 of the Indian Penal Code (IPC) specifically addresses criminal breach of trust by carriers, wharfingers, or warehouse-keepers. If these individuals are entrusted with property and commit a criminal breach of trust regarding such property, they can face imprisonment for a maximum term of 7 years, in addition to a fine.
Section 408 IPC
Section 408 IPC, focuses on criminal breach of trust by a clerk, servant, or anyone employed in a similar capacity who has been entrusted in any manner with property or dominion over it. In such instances, the punishment involves imprisonment for a period of up to 7 years, along with a fine.
Section 409 IPC
Section 409 IPC deals with criminal breach of trust by a public servant or someone conducting business as a banker, merchant, factor, broker, attorney, or agent, who has been entrusted with property or dominion over it. The prescribed punishment for this offense is either imprisonment for life or a term of ten years, along with a fine.
Essentials of criminal breach of trust
There are certain essential factors that must be fulfilled for criminal breach of trust to take place. They are as follows:
- Entrustment of property to the accused is mandatory.
- That the person must dishonestly misappropriate or convert such property for his own use or wilfully make any other person use such property.
- There must be a violation of a law, contract, or trust by the accused.
Difference between criminal breach of trust and criminal misappropriation
The distinctions between criminal breach of trust and criminal misappropriation are outlined below:
Legal Definitions:
Criminal misappropriation
It is defined under Section 403 IPC, stating that whoever dishonestly misappropriated or converts any movable property for personal use may face imprisonment for a term up to two years, a fine, or both.
Criminal breach of trust
As discussed earlier, it is defined in Section 405 IPC, involving a contractual relationship between the parties. The punishment under Section 406 for criminal breach of trust is imprisonment for up to 2 years, a fine, or both.
Contractual Relationship:
A contractual relationship exists in criminal breach of trust, whereas no such contract is present in criminal misappropriation.
Source of Property:
In criminal breach of trust, the property is obtained by the accused through entrustment by the owner. On the other hand, in criminal misappropriation, the property is acquired directly from the owner or any other source.
Nature of Property:
Criminal breach of trust can involve both movable and immovable property. In contrast, criminal misappropriation specifically pertains to movable property.
Punishment:
The punishment for both offenses includes imprisonment for up to 2 years, a fine, or a combination of both. Section 406 covers criminal breach of trust, while Section 403 applies to criminal misappropriation.
Conclusion
For the commission of the offense of criminal breach of trust, it is imperative that all its essential elements be satisfied. These include the entrustment of property, leading to the establishment of a fiduciary relationship between the involved parties. The accused must exercise dominion over the property and subsequently breach the trust of the other party by converting the property for personal use or some other arbitrary purpose, all while harboring a dishonest intention. The presence of dishonest intention is a critical factor in this context. Furthermore, it’s noteworthy that the property subject to breach of trust need not exclusively be either movable or immovable; it can be of either nature.
FAQs
What is criminal breach of trust 406?
Criminal Breach of Trust under Section 406 involves an individual committing an offense by utilizing or converting someone else’s property for personal gain, ultimately disregarding the best interests of the property owner. This offense arises when there is a connection between the transferor and transferee of the property, with the transferor maintaining legal ownership.
What is the difference between theft and criminal breach of trust?
Distinguishing between theft and criminal breach of trust, theft occurs when property is dishonestly taken without prior lawful possession, completing the offense upon the act of taking. On the other hand, criminal breach of trust involves the offender already being in possession of the property and the offense reaching completion when the property is dishonestly converted for personal use.
How do you prove criminal breach of trust?
To establish a case of criminal breach of trust, the prosecution must prove that there was an entrustment of property to the accused, and the accused dishonestly misappropriated the property for personal use.
What is criminal breach of trust in simple words?
In simpler terms, a criminal breach of trust occurs when an individual is entrusted with property, and they dishonestly use, convert, or dispose of the property against legal directives or contractual agreements.
What are the essentials of criminal breach of trust?
The essential elements for proving criminal breach of trust include the existence of property entrustment, the dishonest misappropriation or conversion of the property, and a violation of law, contract, or trust committed by the accused.