Jamia Hamdard (Hamdard Institute of Legal Research and Studies)

CRIMINAL
MISAPPROPRIAT
ION OF
PROPERTY
Criminal Law Project Third Semester

Bushra Mohammad
12-30-2021
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CONTENTS
ABSTRACT.............................................................................................2
introduction...............................................................................................2
CRIMINAL MISAPPROPRIATION OF PROPERTY...........................2
1. DISHONEST INTENTION...........................................................3
2. MISAPPROPRIATION OR CONVERSION OF PROPERTY
FOR OWN USE...................................................................................4
3. MOVABLE PROPERTY..............................................................5
DISTINCTION BETWEEN THEFT AND CRIMINAL
MISAPPROPRIATION............................................................................6
CONCLUSION.........................................................................................7
Bibliography.............................................................................................8
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ABSTRACT
The term 'Misappropriation' stands for dishonest appropriation and
utilisation of an individual's property or fund for the sole purpose of
personal benefit and usage. Criminal misappropriation occurs when
someone has coveted another individual's property out of goodwill and
subsequently transforms its intention dishonestly and makes use of the
property for his benefit. Section 403 and Section 404 of the Indian Penal Code (IPC)
covers the domain of Criminal Misappropriation. This paper will dive
deeper into the various aspects of Criminal Misappropriation and learn
how it distinguishes itself from theft. Most of the time, there arises
confusion between Criminal Misappropriation and Theft concepts.
However, there exists a thin line that differentiates Theft and criminal
Misappropriation.

INTRODUCTION
There exists an everlasting concern regarding the crimes against
property in all communities. Certain property wrongs are widespread in
all jurisdictions, including theft, trespass, burglary, larceny, robbery,
misappropriation, embezzlement, extortion, etc. Criminal evil exists
against any property (movable or immovable) in which partial or
complete damage is caused, or property may be coveted from the lawful
owner or possessor.
Indian Penal Code recognised specific categories of criminal wrongs
against property in chapter XVII. This paper deals with criminal
misappropriation, specified under Section 403 and Section 404 of the Indian Penal
Code (IPC).
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CRIMINAL MISAPPROPRIATION OF PROPERTY

Criminal Misappropriation of Property is defined as utilising others
property in an unauthorised manner. It is comparatively a new offence
because it developed from the jurisdiction of theft. In the scenario of
theft, change of possession or taking away the property from the
residence of the legal possessor is essential; however, it is not crucial in
the case of criminal misappropriation of property. Therefore, the offence
is very close to theft yet is not precisely the robbery offence.
Section 403 of the IPC defines misappropriation of property as:
Whoever dishonestly misappropriates or converts to his own use of movable property shall be
punished with imprisonment of either description for a term that may extend to two years,
or with fine, or with both.

According to the above definition, there are three essentials of

misappropriation:
1. Dishonest Intention
2. Misappropriation or conversion of property for personal
benefit or use
3. Movable Property

1. DISHONEST INTENTION
Dishonest intention plays a very vital role in the criminal
misappropriation of property. Dishonest intention doesn't need to be
present at the time of the transfer of possession of the property. The
possession of the parcel may be legally or innocently transferred;
however, the subsequent change of intention and utilisation of property
for personal use will bring the act into the category of criminal
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misappropriation. It is well illustrated in illustrations (a) and (b) of the

section.
ILLUSTRATION (A)
A takes property belonging to Z out of Z's possession, in good faith,
believing, at any time when he takes it, that the property belongs to
himself. A is not guilty of theft, but if A, after discovering his mistake,
dishonestly appropriates the property to his use, he is guilty of an
offence under this section.
ILLUSTRATION (B)
A, being on friendly terms with Z, goes into Z's library in Z's absence
and take away a book without Z's express consent. Here, if A was under
the impression that he had Z's implied consent to taking the book to read
it, A has not committed theft. But, if A afterwards sells the book for his
benefit, he is guilty of an offence under this section.
Dishonest intention to misappropriate the property may be permanent or
temporary. Suppose the property is already in the possession of a person
innocently and later, dishonestly misappropriates the property for the
time being, and again it restores the property. In that case, he will be
liable for criminal misappropriation.
In Kesho Ram's case (1889), the accused was given some money by his
master to purchase grain. The accused ran away with the money, and
later, he was arrested with the whole money in his possession. The
defence defended that the accused was not liable under section 403 for
criminal misappropriation because money had been found intact and had
not converted to his use. But the court held that the first possession was
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lawful. The misappropriation consisted not in any actual expenditure of

the money but in the mental act or intent to deprive the master of his
property without any outward or visible trespass, which was rightly
inferred from the accused's conduct.

2.MISAPPROPRIATION OR CONVERSION OF
PROPERTY FOR OWN USE

Misappropriation means taking possession of another property and its

wrongful utilisation. The essence of offence is that some property
belonging to others that comes under the accused's possession,
innocently, is misappropriated or converted by the accused to his own
use misappropriation or conversion need not be permanent. It may be
only for some time. Illustrations (a), (b), and (c) suggest that the original
taking was innocent, but the offence of criminal misappropriation is
constituted due to sufficient dishonest appropriation.
The word 'convert to own use' means set apart for one's own to exclude
others. In Ram Dayal's case (1886), a girl 'A' found a gold necklace, and
she handed it over to 'another girl' C. B, brother of A, represented to C
that the necklace belonged to a man of his acquaintance, and thus took it
in his possession. On inquiry by a police officer a few hours later, B
repeated the representation but afterwards gave up the necklace. The
representations were proved to be untrue to the knowledge of the
accused B. He was, therefore, held guilty of criminal misappropriation.
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3. MOVABLE PROPERTY
Word' any property' means movable property. Movable property is the
subject matter of criminal misappropriation. This movable property is
like movable property of 'theft', but there is a difference in possession of
the property under Theft and criminal Misappropriation. In the case of
theft, the property is taken away. In contrast, in case of criminal
misappropriation, it may be innocent taking or lawful taking at the
beginning, but subsequently, it is dishonestly misappropriated. Finder of
the goods is also liable under the section in some instances.
Mayne stated that there could be no criminal misappropriation in the
case of abundant property. He has cited the example of sacred bulls
abundant before the temple. Still, the temple's idol can hold property
apart from the Pujari, and the latter may be guilty of misappropriation
with temple property.
In a case where B and C were on a railway platform. B had a ticket from
Allahabad to Delhi, and C had a ticket from Allahabad to Kanpur. D, an
illiterate woman, handed over the ticket to C to ascertain whether she
had the correct ticket. Under the pretence of returning his ticket, she
substituted his own ticket and kept B's ticket. She was held liable for
criminal misappropriation and not for cheating.

DISTINCTION BETWEEN THEFT AND CRIMINAL

MISAPPROPRIATION
(1) The first and foremost difference is that initial taking theft is
always wrongful. But in criminal misappropriation, it may be
lawful and innocent. It is a subsequent change of intention
which covert lawful taking into unlawful.
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(2) In the case of theft, there is an invasion of possession of another

person by the wrongdoer. Whereas in the case of criminal
misappropriation, there is no such infringement of right of
possession. In criminal misappropriation, the offender is already
in possession of the property, and his unlawful misappropriation
creates an offence.
(3) In theft, mere moving by is an offence. In criminal
misappropriation may not be an offence even it may be lawful.
(4) In theft, the property is moved without the owner's consent,
whereas, in case of criminal misappropriation, a person might
have come into the possession of the property with the owner's
permission.
(5) The dishonest intention is common to both. In theft, this is
shown by moving the property, while in criminal
misappropriation, it is affected by actual misappropriation.
(6) In the case of theft, dishonest intention precedes taking while it
follows the taking in criminal misappropriation.

CONCLUSION
Section 403 specifies that the law will punish the defendant even if he
has misappropriated the property for a certain period or temporarily. As
per the law, even if the misappropriation is for a short time but it's still
unauthorised, and such unauthorised use is illegal. In the case
of Khandu Sonu Dhobi v. State of Maharashtra (1972), the accused
was working as an agricultural assistant in the soil department
authorised by the government of Maharashtra. He was given the task of
rectification of agricultural bunds and for which he received the
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necessary amount of money. The accused prepared a rectification report

even though he did not adequately do the rectification task. Due to
various complaints being made, the accused completed the work after
several months. The court held that the accused's act of not using the
amount provided for the work allotted made no difference to the charge
of 'Criminal Misappropriation'. Thus, it is the case falling within the
purview of Section 403. The accused was held guilty under section 403
of the Indian Penal Code.

BIBLIOGRAPHY
Myneni, D. S., n.d. Law of Crimes (Indian Penal Code, 1860).
Hyderabad: Asia Law House.
tiwani, c., n.d. indian penal code. s.l.:s.n.