P L D 1962 (W (PLP)

(2) The Provincial Government may appoint any Magistrate of the first class to be an Additional District Magistrate and such Additional District Magistrate shall have all or any of the powers of a District Magistrate under this Code, or under any other law for the time being in force, as the Provincial Government may direct. (3) For the purposes of sections 192, subsection (1), 407, subsection (2) and 528, subsections (2) and (3) such Additional District Magistrate shall be deemed to be subordinate to the District Magistrate."

5. It will thus be seen that the powers of the District Magis trate under section 10 of the Code can be conferred on any Magis trate and‑ not necessarily on the Additional District Magistrate. With his appointment as the Additional Deputy Commissioner, Lahore, Sardar Taimur Shah was not divested of the powers, which were conferred on him under section 10 of the Code. This is in accord with the provisions of section 40 of the Code which is to the following effect: ‑ "Whenever any person holding an office in the service of `Government who has been invested with any powers under this Code throughout any local area is appointed to an equal or higher office of the same nature, within a like local area under the same Provincial Government, he shall, unless the Provincial Government otherwise directs, or has otherwise directed, exercise the same powers in the local area in which he is so appointed." In the absence of a notification under section 41 of the Cods of Criminal Procedure withdrawing all or any of the powers confer red on Sardar Taimur Shah, I should say at once that he Conti nued to exercise the powers of the Additional District Magistrate even after his appointment as Additional Deputy Commissioner, Lahore. '

6. I now advert to the case‑law on the subject. The learned counsel for the petitioner cited Mupal v. Ghulam (P L D 1953 Lah. 110) Hamed Haji v. The Crown (A I R 1923,Mad. 598); Emperor v. Karimbux (A I R 1933 Sind 398) and Zaheer‑ud‑Din v. Collector, Lahore (P L D 1962 Lah. 453). I have read the rulings and find that none of them is applicable to the case before me in revision.

7. The learned Assistant Advocate‑General referred to Queen Empress v. Viranna (I L R 1892 Mad. 132) and, In re: N. Ramaratnam (A I R 1944 Mad. 302). In the former case a Sub‑Registrar having been invested with magis terial powers with reference to offences under Act XXIV of 1859 was transferred from the place where he, was officiating at the time he was so invested to another place, and there took on to his file and tried certain cases. The District Magistrate having reported the case for the orders of the High Court, it was held that under section 40, the Sub‑Registrar was competent to exercise on his transfer to Gannayaram the powers conferred upon him as Sub‑Registrar of Ponnur unless the Local Government directed him not to exercise them. In the latter ruling the question that came up for Consideration before the same High Court was whether' `D', a Government servant, who was empowered to record confessions, when he was Deputy Tehsildar, could exercise those powers, on his return from "Foreign Service", and it was held that as the Government retaining some form of control over D's services even when he was on Foreign Service had recalled him to direct, service ‑under Government aid, then having recalled him,; had posted him as ,Tehsildar, D's case fell directly under section 40 and, therefore, when `D' was appointed Tehsildar, he was "a person holding an office in the service of Government" within the" meaning of section 40'of the Code of Criminal Proce dure. Consequently the powers granted to him as Deputy Tehsil dar could lawfully be exercised by him as Tehsildar and the confessions which he had recorded were not invalidated.

8. On a careful consideration of the law on the subject and the rulings cited at the Bar, I am of the, view that the order passed under section 436, Cr. P. C., directing further enquiry into the case, was validly made by Sardar Taimur Shah.

9. On merits, the petitioner seems to have no case. Agha Aman, the principal accused, was doing business under the name and style of four different firms, namely, (P L D 1953 Lah. 110) Messrs Skin and Wool Corporation, (A I R 1923,Mad. 598) Wool Trading Company, (A I R 1933 Sind 398) M. M. Aslam & Company, and, (P L D 1962 Lah. 453) Irfan Tariq, Trading Company. According to the prosecution, Tariq. Mahmood is the brother‑in‑law, of Muhammad Ashraf, Accountant. Irfan is the son of Agha Aman. Irfan Tariq Trading Company had, its office in the house, in which Muhammad Ashraf lived. We find, from the evidence on record that M. M. Aslam is a close friend and an associate of Agha Aman. We have it in the statement of Rashid‑ur‑Rahman (P. W. 15) that Muhammad Ashraf, Accountant used to be paid Rs. 500 per mensem by Agha Aman for the facilities which he afforded to him as Accountant. M. Tariq Mahmood used to receive Rs. 300 per mensem, while M. M. Aslam was paid Rs. 200 by Agha Aman. The business of Irfan‑Tariq Trading Company, Wool Trading Company and M. M. Aslam & Company, was negotiated through Messrs Skin and Wool Corporation. There is evidence oral as well as documentary that on the 11th of August 1951: Agha Aman, who was one of the petitioners in Criminal Revision No. 330 of 1962 and which has since been withdrawn, opened an account in the name of Messrs Skin and Wool Corporation with the National Bank of Pakistan, Lahore Office. He was introduced to the Bank by Muhammad Ashraf who was working as Accountant at the relevant time, as no account without an introductory reference from a person known to the Bank can be opened. The account of Skin and Wool Corpora tion was opened with .a deposit of Rs. 2,

000. Another deposit was made on the 20th of September 1951 after having withdrawn Rs. 1,000 from the sum initially deposited in the Bank. Prior to it Agha Aman had an account with the Grindlays Bank when Messrs Skin and Wool Corporation had made a reference to a foreign firm and immediately Agha Aman opened an account with the National Bank of Pakistan evidently with a view to secure a favourable report for the satisfaction of foreign buyers. The balance of Messrs Skin and Wool Corporation was Rs. 58‑12‑0 on the 4th of February 1952 when the first advance of Rs. 17,496 was granted to this firm.

10. On the 30th of January 1952, Messrs Skin and Wool Corporation applied for packing credit limit of Rs. 3,00,000 and this was granted without the Chief Manager making his own independent enquiries from the market and from at least two parties uninfluenced by the borrower and the Chief Cashier. These enquiries are normally made from persons who are in the same trade and are known to the Bank and can be relied upon for their opinion. Muhammad Umar Khan, who was working as the Chief Manager at the relevant time, did not comply with the instructions contained in Chapter X, Para. 20 of the Bank's Book of Instructions. Mian Muhammad Saeed, wool dealer, Ward No. 5, Jhang City, and S, M. Shaida, proprietor Pak Land Printing Press, Lahore, were mentioned as the referees `by Messrs Skin and Wool Corporation. There was no person of the name of S. M. Shaida. S. M. Shaida had no account with the National Bank nor had Mian Muhammad Saeed. The reports received from the referees were favourable. Muhammad Umar Khan, the then Chief Manager of the Bank, sanctioned the grant to be operative from the 4th of February 1952. The Chief Cashier had recommended a grant of Rs. 1,50,000 and there was hardly any justification for the Chief Manager to grant the credit limit of Rs, 3,00,

000. It is clear on record that by the 30th of September 1952, the borrower Agha Aman of Messrs Skin and Wool Corporation had not reimbursed the Bank and there was a balance of Rs. 2;65,950 due from the Corporation. Nevertheless advances were granted to the Corporation. The limit was extended and the amount of the credit enhanced. This was done by the Chief Manager of the Bank and overdrafts were granted by cheques, and these cheques were paid on the authority of Muhammad Ashraf, Accountant, who was not authorised to grant such overdrafts. A number of references were received from the foreign buyers. Replies sent by the Bank were highly exaggerated and not based on any record available with the Bank. Government of Pakistan, Department of Commercial Intelligence, pointed out to the Bank that a firm known as Abdul Latif & Company had defrauded several American importers of wool and that it was understood that the same firm had started business in the name of Messrs Skin and Wool Corporation. In reply, the Bank sent the letter Exh. P. W. 1/401 which bears the initials of Muhammad Ashraf, Accountant. The reply spoke of dealings with the bank as satisfactory and stated "that the proprietor of the firm is Mr. Agha who is a pushing chap and had good market reputation and that top‑ranking businessmen of this line speak very highly about him". The letter emphasized that Messrs Skin and Wool Corporation had no connection with the six firms who had defrauded the American buyers. Messrs Skin and Wool Corporation and the allied concerns gave references to the buyers abroad that the National Bank of Pakistan were their bankers. There is evidence that the Chief Manager gave loan facilities to this concern against meagre security. The principal accused Agha Aman, who had no property or assets in Pakistan and had taken Rs. 2,000 as a loan from M. Yasin to open an account with the Bank, was advanced huge amounts out of all proportion to the security with the Bank or even without security. The Bank authorities were constantly sending out false and exaggerated reports not only to the head office but also to foreign firms. After his credit had been established by these false and exaggrated reports. Agha Aman made an application for credit facilities. The evidence discloses that the credit facilities were provided by the Chief Manager dishonestly and contrary to the directions given to him under the Bank's Book of Instructions. Mr. Muhammad Umar Khan kept the Foreign Exchange Depart ment under him in spite of the fact that the Chief Accountant had been appointed in May 1953 to look after the business side of the National Bank of Pakistan, Lahore. Mr. Muhammad Umar Khan kept under him the "Advances Section" of the business side and also the foreign exchange. When Agha Aman asked for packing credit facility, the Accountant ordered S. Rafaqat Ali Shah (P. W. 13), who was the Chief Cashier, to give a report regarding credit worthiness of Agha Aman accused. The Accountant asked for a report on the same day and when the Chief Cashier expressed his inability to do so, he was referred to the Manager who ordered the Chief Cashier that he should submit his report on that very day. On the receipt of the report the Manager, without making any independent enquiries or looking into the accounts, gave a good report and thereby falsified the Bank's record. The Manager was not expected to be guided by the Chief d Cashier's report in such a matter, but was bound to make inde pendent enquiries of his own. A careful examination of the account should have been mad by the Manager to see if Agha Aman deserved the accommodation asked for, and further that he was not overtrading. The record shows that when moneys were brought back through letters of credit on goods shipped, the interest was not credited to the Bank, insurance charges were not collected from the borrowers, and charges of forwarding agents were paid out of the proceeds which were already short. Under -invoicing was done by making misrepresentation to the State Bank of Pakistan and the Customs authorities. The registers were not properly maintained and the documents were neither checked nor the same got properly executed by the Chief Manager. He was supposed to look into the master‑file prepared by the Manager to keep himself in touch with all these matters, but Mr. Muhammad Umar Khan never took the trouble of scrutinizing that advances or demand loans were given for genuine' business or trading requirement and that the Bank's interests were fully safeguarded. The various letters sent by the State Bank of Pakistan to Muhammad Umar Khan were not answered or evasive replies were given We have it in the statement of Ghulam Sarwar that Muhammad Ashraf and Muhammad Umar Khan continued to help Messrs Skin and Wool Corporation knowing that Agha Amar was doing fraudulent business. Ghulam Sarwar stated that in the beginning of 1952 an intimation was received from Karachi that the Bank should have no dealing with Agha Aman. This letter was shown to Muhammad Ashraf by the witness. He kept it in the drawer of his desk from which the same was stolen the next day. When he went to England in 1954, Agha Aman executed a letter of authority in favour of Tariq Mahmood Authorising him to operate on his account in his absence. Tariq Mahmood executed a promissory note in favour of the Bank for Rs. 10,00,

000. There is the evidence of Muhammad Asghar P. W. that the letter of authority in favour of Tariq Mahmood was incomplete. It was undated, unstamped and incompletely filled in, but still the Bank accepted it. Tariq Mahmood made out a cheque for Rs. 2,000 and withdrew the amount from the account of Agha Aman. Mr. Muhammad Umar Khan initialed the cheque which constituted the authority for Muhammad Asghar to pass the cheque for payment. It was elicited in cross‑exami nation of Mr. Kazmi (P. W. 1) that advances in excess of the sanctioned limit were granted by Mr. Muhammad Umar Khan and Muhammad Ashraf and the matter was not reported by them to the head office. We have it from Rashid‑ur‑Rahman (P. W. 15) that Agha Aman took Rs. 20,000 telling Rashid‑ur‑Rahman that he had to spend the amount in connection with the marriage of the daughter of Mr. Muhammad Umar Khan. The Manager finding that it had become impossible to recover Rs. 5,00,000 from Agha Aman recommended to the head office that he should be given further facility up to Rs. 10,00,

000. The limit of Rs. 10,00,000 was provided by the head office in consequence of misrepresentations made to them by the Manager. The National Bank of Pakistan thereby suffered a loss of about Rs. 12,00,

000. It clearly indicates to my mind that Mr. Muhammad Umar Khan, who was the Chief Manager at the relevant time, was in league with Agha Aman and others to defraud the Bank.

11. This brings me to the question whether these overt acts on the part of the Bank employees were sufficient to infer that they had conspired with the principal accused to defraud the Bank. `Criminal conspiracy' is defined in section 120‑A, P. P. C. It reads as below: ‑ "When two or more persons agree to do, or cause to be done-- (1) an illegal act, or (2) an act which is not illegal by illegal means, such an agree ment is designated a criminal conspiracy Provided that no agreement except an agreement to commit an offence shall amount to a criminal conspiracy unless some act besides the agreement is done by one or more parties to such agreement in pursuance thereof. Explanation.‑It is immaterial whether the illegal act is the ultimate object of such agreement, or is merely incidental to that object." A criminal conspiracy can be inferred from the act and conduct of parties. If overt acts are proved, Courts would be bound to infer that they are not unconnected or isolated but must have been in connection with the criminal conspiracy. Inferences of con spiracy can be drawn from the facts established in the case. I would not express myself on the evidence adduced in support of the charge of criminal conspiracy in this case, because that might result in prejudice to either side, and leave this question to be decided by the trial Court.

12. Passing on to the order of discharge passed by the learned Magistrate I find that it is hardly two‑page order. The Magistrate did not address himself to the question whether there was evidence regarding criminal conspiracy. It is not clear from the order of the Magistrate under which part of section 253, Cf. P. C. he purported to act when he passed the order. Section 253 runs thus: "(1) If, upon taking all the evidence referred to in sec tion 252, and making such examination (if any) of the accused as the Magistrate thinks necessary, he finds that no case against the accused has been made out which, if unrebutted, would warrant his conviction, the Magistrate shall discharge him. "(2) Nothing in this section shall be deemed to prevent a Magistrate from discharging the accused at any previous stage of the case if, for reasons to be recorded by such Magistrate, he considers the charge to be groundless." So, under this section a Court has two alternatives, it may take all the evidence and then decide as prescribed by clause (1), or it may, if it finds that the case is so transparently false or undisputedly beyond jurisdiction of the Criminal Courts that it would not act upon the complaint even if the prosecution evidence were recorded, discharge the accused without hearing the evidence under clause (2). See Saran Singh v. S. S. Kirpal Singh (A I R 1935 Pesh. 23). In the present case it appears that the Magistrate acted under the second limb of the section. One of the prerequisites for passing an, order under clause (2) is that the Magistrate should come to the conclusion that the charge against the accused is groundless. To say that no case has been made out is not tantamount to saying that the charge is groundless.‑ The Magistrate in his order described the charge against the accused as `rather weak'. The Magistrate completely overlooked the fact that still 45 witnesses remained to be examined by the prosecution. He had not ascer tained from the prosecution the nature of the evidence, which they had still to produce, against Mr. Muhammad Umar Khan and others and as such the order passed is vitiated and is perverse. The examination of Muhammad Umar Khan and Tariq Mahmood shows that a mass of evidence was put to them and they came forward with bare denials. The petitioners by their bare denials were not able to efface the effect of the evidence on one's mind, and as such there was no' justification whatsoever for the order discharging Tariq Mahmood and Muhammad Umar Khan.

13. Where a complaint prima facie discloses an offence, a Magistrate cannot hold the charge to be groundless unless he knows what sort of evidence is going to be adduced to prove it, and he n cannot for example examine one or two witnesses or, for the matter of that, no witnesses at all, and then without knowing what the other witnesses are going to say, hold that the charge is groundless. He can only judicially come to such a conclusion when he had at least ascertained from the complainant what is the nature of the evidence that the other witnesses are going to give. See Mahamud Sheriff Sahib v. Moulvi Abdul Karim Sahib (I L R 1928 Mad. 185).

14. In a case of criminal breach of trust where only a few of the prosecution witnesses have been examined it is too premature to decline to examine any more witnesses for the prosecution and discharge the accused. See Chan Elliam v. L. H. Wellington (A I R 1939 Rang. 377).

15. The Lahore High Court in Hakim Singh v. Lal Singh (A I R 1930 Lah. 158) held that "Where a Magistrate discharges the accused without allowing the complainant to adduce all his evidence, it cannot be said that there is a full and complete inquiry in the case, and the order of the District Magistrate directing full inquiry should not be interfered with. Section 253 no doubt gives a Magis trate power to discharge before entire case is complete and such order is legal, but when the inquiry has been incomplete the District Magistrate acts with equal legality in directing further inquiry." I am in respectful agreement with the observations made in the aforesaid case. I consider that the order of discharge was not only improper but was also perverse in the circumstances of the case. It had been rightly set aside by Sardar Taimur Shah.

16. In the view that I have taken of the matter, I find that Revision Petitions Nos. 232 and 237 of 1962 are without any substance, and are dismissed. K. B. A. Petitions dismissed.