Code: Section 316 BNS
(1) Whoever, being in any manner entrusted with property, or with any dominion
over property, dishonestly misappropriates or converts to his own use that property, or
dishonestly uses or disposes of that property in violation of any direction of law prescribing
the mode in which such trust is to be discharged, or of any legal contract, express or implied,
which he has made touching the discharge of such trust, or wilfully suffers any other person
so to do, commits criminal breach of trust.
Explanation 1.—A person, being an employer of an establishment whether
exempted under section 17 of the Employees’ Provident Funds and Miscellaneous
Provisions Act, 1952 or not who deducts the employee’s contribution from the wages payable
to the employee for credit to a Provident Fund or Family Pension Fund established by any
law for the time being in force, shall be deemed to have been entrusted with the amount of the
contribution so deducted by him and if he makes default in the payment of such contribution
to the said Fund in violation of the said law, shall be deemed to have dishonestly used the
amount of the said contribution in violation of a direction of law as aforesaid.
Explanation 2.—A person, being an employer, who deducts the employees’
contribution from the wages payable to the employee for credit to the Employees’ State
Insurance Fund held and administered by the Employees’ State Insurance Corporation
established under the Employees’ State Insurance Act, 1948 shall be deemed to have been
entrusted with the amount of the contribution so deducted by him and if he makes default in
the payment of such contribution to the said Fund in violation of the said Act, shall be
deemed to have dishonestly used the amount of the said contribution in violation of a
direction of law as aforesaid.
Illustrations.
(a) A, being executor to the will of a deceased person, dishonestly disobeys the law
which directs him to divide the effects according to the will, and appropriates them to his
own use. A has committed criminal breach of trust.
(b) A is a warehouse-keeper Z going on a journey, entrusts his furniture to A, under a
contract that it shall be returned on payment of a stipulated sum for warehouse room. A
dishonestly sells the goods. A has committed criminal breach of trust.
(c) A, residing in Kolkata, is agent for Z, residing at Delhi. There is an express or implied
contract between A and Z, that all sums remitted by Z to A shall be invested by A, according
to Z’s direction. Z remits one lakh of rupees to A, with directions to A to invest the same in
Company’s paper. A dishonestly disobeys the directions and employs the money in his own
business. A has committed criminal breach of trust.
(d) But if A, in illustration (c), not dishonestly but in good faith, believing that it will be
more for Z’s advantage to hold shares in the Bank of Bengal, disobeys Z’s directions, and
buys shares in the Bank of Bengal, for Z, instead of buying Company’s paper, here,
though Z should suffer loss, and should be entitled to bring a civil action against A, on
account of that loss, yet A, not having acted dishonestly, has not committed criminal
breach of trust.
(e) A, a revenue-officer, is entrusted with public money and is either directed by law, or
bound by a contract, express or implied, with the Government, to pay into a certain treasury
all the public money which he holds. A dishonestly appropriates the money. A has committed
criminal breach of trust.
(f) A, a carrier, is entrusted by Z with property to be carried by land or by water. A
dishonestly misappropriates the property. A has committed criminal breach of trust.
(2) Whoever commits criminal breach of trust shall be punished with imprisonment of
either description for a term which may extend to five years, or with fine, or with both.
(3) Whoever, being entrusted with property as a carrier, wharfinger or
warehouse-keeper, commits criminal breach of trust in respect of such property, shall be
punished with imprisonment of either description for a term which may extend to seven
years, and shall also be liable to fine.
(4) Whoever, being a clerk or servant or employed as a clerk or servant, and being in
any manner entrusted in such capacity with property, or with any dominion over property,
commits criminal breach of trust in respect of that property, shall be punished with
imprisonment of either description for a term which may extend to seven years, and shall also
be liable to fine.
(5) Whoever, being in any manner entrusted with property, or with any dominion over
property in his capacity of a public servant or in the way of his business as a banker,
merchant, factor, broker, attorney or agent commits criminal breach of trust in respect of that
property, shall be punished with imprisonment for life, or with imprisonment of either
description for a term which may extend to ten years, and shall also be liable to fine.
Explanation of Section 316 BNS
Section 316 of the Bharatiya Nyaya Sanhita (BNS) defines Criminal Breach of Trust as the dishonest misappropriation or conversion of property entrusted to an individual. This includes using property in violation of legal directives or contractual obligations. The section also expands the scope to include specific cases like employers failing to deposit Provident Fund contributions or Employees’ State Insurance contributions.
Key Provisions:
- Dishonest Misappropriation: Taking property entrusted to someone for personal use.
- Legal Violations: Disposing of property against legal or contractual obligations.
- Specific Offences: Includes failure to deposit employees’ contributions to statutory funds.
- Punishments: Ranges from fines and imprisonment to life sentences depending on the offender’s capacity (e.g., public servant, clerk, or employer).
Illustrations
- Example 1: Executor’s Breach of Trust
A, an executor of a deceased person’s will, dishonestly appropriates the assets instead of distributing them according to the will.- Verdict: A has committed Criminal Breach of Trust.
- Example 2: Warehouse Keeper’s Fraud
A warehouse-keeper, entrusted with goods, sells them instead of returning them as agreed.- Verdict: A has committed Criminal Breach of Trust.
- Example 3: Employer’s Failure to Deposit PF Contributions
An employer deducts Provident Fund contributions from employees’ wages but fails to deposit them in the fund.- Verdict: The employer has committed Criminal Breach of Trust under Explanation 1 of Section 316.
- Example 4: Good Faith Investment
A, an agent, invests client’s money in a different company’s shares, believing it to be in the client’s best interest.- Verdict: Since A acted in good faith, this is not considered a criminal breach of trust.
Common Questions and Answers on Section 316 BNS
1. What is considered criminal breach of trust under Section 316?
- Answer: It includes dishonest misappropriation, conversion, or use of property entrusted to someone, violating legal or contractual obligations.
2. What are the punishments for criminal breach of trust?
- Answer: Punishments vary from imprisonment (up to 10 years or life imprisonment) and fines depending on the offender’s role (e.g., public servant, clerk, employer).
3. Does failing to deposit Provident Fund contributions qualify as criminal breach of trust?
- Answer: Yes, under Explanation 1 of Section 316, it qualifies as a criminal breach of trust.
4. Can someone be punished for breach of trust even if there was no financial gain?
- Answer: Yes, the key factor is dishonest intent, not financial gain. If property is misused dishonestly, it constitutes a breach of trust.
5. What is the role of good faith in breach of trust cases?
- Answer: If an individual acts in good faith, believing their actions benefit the entrusted party, it may not be considered a criminal breach of trust (as shown in Example 4).
Conclusion
Section 316 BNS plays a crucial role in protecting property entrusted to individuals, ensuring that those in positions of trust are held accountable for dishonest practices. Whether in personal, professional, or statutory capacities, the law defines clear boundaries and consequences for breach of trust.
