Criminal Breach of Trust Under Section 406 PPC: Misuse, Misinterpretation, and the Duty of Courts

Dated: 7/24/2025 by Reyan Hameed

The offence of criminal breach of trust, as defined under Section 406 of the Pakistan Penal Code (PPC), continues to be widely misunderstood and misapplied in Pakistan's legal system. A recent judgment by Justice Sardar Tariq Masood in the case of Muhammad Amjad Naeem v. The State through P.G Punjab, Lahore and another (Crl.P.L.A.170-L/2025) sheds much-needed light on the true scope of this offence and highlights the serious concerns over its misuse in civil matters.

Understanding Criminal Breach of Trust

A plain reading of Section 406 PPC reveals two critical elements that must be established for a conviction:

1. Entrustment of property as a trust (Amanat) — meaning that the property was handed over to someone with a responsibility to hold it in trust.

2. Dishonest misappropriation or misuse of that property — where the trustee misuses or disposes of the property against the terms of the trust or the law.

Both conditions are essential. If either is missing, the charge of criminal breach of trust does not hold.

What Constitutes Entrustment?

Under Section 405 PPC, entrustment is a broad concept. It refers to a scenario where the ownership of the property remains with the giver, and only temporary custody or possession is transferred to another person for a specific purpose. The entrusted property must be returned as-is and cannot be used for any unauthorized purposes.

This arrangement creates a fiduciary relationship between the parties. However, it does not have to conform to the technical definitions of trust in civil law. The key idea is that the property was handed over with the expectation that it would be returned or used strictly according to the giver’s instructions.

Distinguishing Civil Disputes from Criminal Offences

One of the most significant observations in the judgment is the growing misuse of Section 405 PPC in matters that are essentially civil in nature, such as business disputes or breaches of contract. For instance, when money is invested in a business venture, the expectation is profit, not the return of the exact amount. Therefore, such transactions do not fall within the scope of entrustment, and hence cannot be prosecuted under criminal breach of trust laws.

In contrast, a sale transfers ownership of the property to the buyer. The concept of trust or amanat does not apply between a seller and buyer, or between a shopkeeper and customer. Hence, business relationships involving investments, profits, and contracts are governed by civil law — not criminal law.

Failure to Pay Profits ≠ Criminal Breach of Trust

The Supreme Court has also clarified that mere failure to deliver profits, a breach of contract, or non-fulfillment of a promise — without clear entrustment of property — does not qualify as criminal breach of trust. Treating such cases as criminal offences distorts the line between civil and criminal law, often for personal or strategic gain.

Concern Over Misuse and Judicial Oversight

Justice Sardar Tariq Masood has voiced deep concern over the widespread abuse of Section 405 PPC in civil cases. Litigants are increasingly using criminal law to pressure opposing parties or expedite financial recoveries. This not only burdens the criminal justice system but also leads to unwarranted criminal proceedings against individuals — many of whom end up in jail for offences that are not even prima facie made out.

The judgment underscores the responsibility of Magisterial and Sessions Courts to carefully evaluate whether the two elements of criminal breach of trust are present. If not, the accused must not be denied bail — doing so would be a grave miscarriage of justice.

Bail and the Binding Nature of Precedents

Another critical point addressed in the judgment is the repeated failure of trial courts to follow binding precedents, particularly the principles laid down in the Tariq Bashir case. Under Article 189 of the Constitution of Pakistan, judgments of the Supreme Court are binding on all lower courts.

Justice Masood highlighted that failure to apply settled law, especially in non-prohibitory offences under Section 497 Cr.P.C., is unacceptable and reflects judicial indiscipline. In such cases, grant of bail is the rule, not the exception, and should only be denied in extraordinary circumstances.

Conclusion and Directive to Lower Courts

In a powerful conclusion, the Supreme Court directed that a copy of this judgment be sent to the Registrars of all High Courts for circulation among District Courts nationwide. The Court reminded the judiciary that compliance with this ruling is mandatory, not optional.

The ruling serves as a stern reminder that criminal law cannot be weaponized for civil disputes, and that liberty should not be compromised due to misinterpretation or neglect of binding legal principles.

Key Takeaways:

• Not every business loss or breach of contract amounts to criminal breach of trust.

• Entrustment must be clearly established before invoking Section 406 PPC.

• Misusing criminal law for civil matters is a growing concern.

• Lower courts must follow Supreme Court precedents strictly, especially in bail matters.

• Bail in non-prohibitory offences should be granted unless exceptional circumstances exist.

References:

• Muhammad Amjad Naeem v. The State through P.G Punjab, Lahore and another (Crl.P.L.A.170-L/2025)

• Justice Khurshid Anwar Bhinder v. Federation of Pakistan (PLD 2010 SC 483)

• Allied Bank Limited v. Habib-ur-Rehman (2023 SCMR 1232)

When Justice Smells of Bias: A Closer Look at PLJ 2024 CrC 79

Dated: 7/3/2025 by Reyan Hameed

It’s an open secret now: the "war on drugs" in Pakistan often becomes more of a numbers game than a genuine effort to ensure justice. The recent judgment in PLJ 2024 CrC 79 sheds light on a troubling pattern—where the very law enforcers meant to uphold justice may themselves be crossing the line.

The case in question, Crl. Misc.34710/23, titled Shehzad vs The State, came before Justice Syed Shahbaz Ali Rizvi of the Lahore High Court. At the heart of the matter was a disturbing but familiar concern: false implication in narcotics cases by lower-ranking police officials—allegedly to show progress in anti-drug crackdowns initiated by their superiors.

The court noted that this practice, sadly, is becoming “a growing phenomenon in our police culture.” People with prior criminal records—easy targets in the eyes of the police—are being booked under fabricated evidence to create a façade of success. This isn't just an ethical lapse; it's a direct hit on the principle of fair trial guaranteed by the Constitution.

In Shehzad’s case, the inexcusable delay in filing the challan (charge sheet) raised red flags. The court observed that such delay was not just bureaucratic sloppiness—it “prima facie stinks of mala fide.” In other words, it smelled of intentional wrongdoing.

The implications are serious. Justice Rizvi, while allowing bail, made it clear: maintaining law and order cannot come at the cost of basic human rights. Expedient, fair, and untainted legal proceedings are the foundation of justice, not manufactured statistics.

This case is a stark reminder that the integrity of our criminal justice system depends not just on laws, but on those who enforce them. Justice must not only be done, it must be seen to be done—with clean hands and clear intentions.

Compromise in Criminal Cases and Its Effect – A Legal Perspective from Pakistani Courts

Dated: 7/3/2025 by Reyan Hameed

When we think of justice in criminal cases, we often picture a courtroom, a judge, and a verdict that either punishes or acquits the accused. But the truth is, not every criminal case ends with a long trial or a harsh sentence. Sometimes, justice takes a different route—through compromise.

In Pakistan, the concept of compromise in criminal law plays a significant role, especially in cases involving compoundable offences. But what exactly does it mean to compromise in a criminal case? And what happens when parties try to settle even in non-compoundable offences? Let’s unpack this with real judgments and examples from our courts.

What Are Compoundable Offences?

In simple terms, compoundable offences are those where the law allows the victim or their legal heirs to forgive the accused—often with the court's permission. This usually happens in offences that affect individuals directly, like bodily harm or even murder under certain provisions, where the victim’s family may forgive in the name of Almighty Allah.

Take for example the case of Shabbir Ahmed v. The State (NLR 1992 CrLJ 320), where the Lahore High Court accepted a compromise between the convict and the complainant during an appeal in a murder case and acquitted the accused.

Similarly, in Muhammad Anar v. The State (1995 MLD 1503), the legal heirs of the deceased voluntarily forgave the accused without any monetary compensation, which the court respected and allowed the compromise.

In another remarkable case, Ibrahim v. The State (1995 SCMR 1296), the Supreme Court observed that since all legal requirements for a lawful compromise were fulfilled—and considering the family ties between the parties—the compromise was accepted, and the accused were set free.

And What About Non-Compoundable Offences?

Now here’s where things get complicated.

Non-compoundable offences are considered graver and affect society at large, like terrorism, kidnapping for ransom, and gang dacoity. These cannot be forgiven by private parties, even if they try to settle out of court. The idea is simple: you can't trade away justice when the crime harms the public at large.

In Hazrat Khan v. The State (2008 MLD 991), although the parties reached a compromise, the offences (theft, arms possession, and gang activity) were non-compoundable. But since the punishment did not fall under the prohibitory clause of Section 497 CrPC, the court granted bail—not based on the compromise but on legal grounds.

In contrast, Saeed Ahmad v. The State (PLD 2003 SC 389) shows the limits of compromise. The legal heirs forgave the accused in a murder and kidnapping case. While Section 302 (murder) was compoundable, Section 365-A (kidnapping for ransom) was not. The evidence of kidnapping was strong, and since kidnapping for ransom poses a serious threat to society, the Supreme Court upheld the death sentence despite the forgiveness offered in the murder charge.

When Courts Consider Compromise in Non-Compoundable Offences

Even though the law doesn’t allow compounding in non-compoundable cases, our courts have shown a human side.

In Nazir Ahmad v. The State (2007 PCrLJ 185), the court didn’t set aside the conviction in a non-compoundable offence under Sections 396 and 460 PPC but did reduce the sentence, acknowledging the family's forgiveness and the time already served.

Similarly, in Hafiz Muhammad Aslam v. The State (2006 MLD 1288), the court upheld the conviction under Section 377 PPC (unnatural offence) but reduced the sentence from a harsher term to just two years’ rigorous imprisonment.

Why Compromise Matters—and When It Doesn’t

Compromise brings a human element to criminal law. It can heal wounds, rebuild relationships, and sometimes, save someone from lifelong imprisonment. Islamic principles also value forgiveness and allow victims’ families to pardon offenders in the name of Allah.

However, the courts draw a line when the crime involves society’s safety, like terrorism, rape, or dacoity. In such cases, even the most heartfelt forgiveness cannot replace the need for deterrence and justice.

Cases like Malik Jahangir Ahmad v. Special Court (PLD 2005 Lahore 328) clarify that compromise cannot override public policy or legislative intent. When the offence is against the state or society, the court’s hands are tied.

Final Thoughts

Compromise in criminal law walks a tightrope between justice and mercy. Our courts have shown time and again that they are willing to accept compromise in the interest of peace, provided it aligns with the law. But when the stakes are high, and public safety is involved, the law speaks louder than private settlement.

Pakistan’s legal framework, rooted in both Islamic principles and procedural fairness, provides a thoughtful balance—but it always reminds us: justice must serve not just the individual, but the society too.

Understanding the Supreme Court's Take on Bail in Cross-Cases – PLD 2024 SC 969

Dated: 7/3/2025 by Reyan Hameed

In a recent judgment that carries significant weight for criminal practice, the Supreme Court of Pakistan in PLD 2024 SC 969 revisited the principles surrounding bail in cross-cases. While this isn’t an entirely new legal terrain, the clarity and reaffirmation offered by the Court bring much-needed guidance for lawyers, litigants, and lower courts alike.

Cross-Cases: A Complex Legal Territory

Cross-cases typically arise when both parties to a dispute or incident accuse each other of criminal wrongdoing, often stemming from the same occurrence. These are common in violent altercations, family feuds, or land disputes. But what has always been a grey area is how bail should be approached in such situations. The Supreme Court has now shed light on this nuanced subject.

Key Takeaways from the Judgment

Let’s break down the core principles the Court reaffirmed and clarified in this landmark judgment:

1. Not Every Counter-Claim is a Cross-Case

The Court has rightly emphasized that a simple denial or a counter-narrative isn’t enough to qualify as a cross-case. There needs to be a tentative judicial assessment that:

• The incident being narrated is the same,

• The parties involved are largely identical, and

• The occurrence appears to be a single transaction told from different perspectives.

This safeguard is essential because it prevents frivolous or strategically false cross-cases from being used to exploit legal leniencies.

2. Bail is Generally the Rule, Not the Exception

When there are counter versions of the same incident – say, one in the FIR and the other from the opposing party – courts are encouraged to grant bail in appropriate cases. The underlying logic is simple: at the bail stage, it’s not possible to conclusively determine whose version is true or who the actual aggressor was. That determination only comes after a full trial when both sides present their evidence.

So, unless there’s something glaringly obvious pointing to one party’s guilt, bail should be the rule.

3. But Not Always—There Are Exceptions

This doesn’t mean bail is granted blindly in every cross-case. The Court carved out an important exception: if the available material suggests that the accused had a clear and active role in causing a fatal injury, or if it appears they were the primary aggressor, bail may be denied. Each case still hinges on its own facts.

4. Absence of a Specific Role May Tilt the Balance

Interestingly, where the counter-allegations don’t clearly assign an effective role in causing serious harm or death, the case may fall under the category of “further inquiry” under Section 497 of the Cr.P.C. This, again, typically favors the grant of bail.

5. Equal Treatment in Cross-Cases

A valuable principle restated by the Court is that when bail is granted to one party in a cross-case, the other party should usually be extended the same treatment—provided, of course, that the facts and allegations are comparable. This promotes fairness and balance in the judicial process.

Conclusion

The ruling in Ahmad Ali v. The State (Crl.P.183-P/2022) provides a thoughtful and structured approach to handling bail in cross-cases. It recognizes the practical realities of our legal system, where false counter-cases are not unheard of, but also ensures that justice isn’t denied to those who may be falsely implicated.

For lawyers handling such matters, this judgment is now a crucial reference point—offering both a shield for the innocent and a filter to weed out dishonest claims.

Section 354 PPC No Longer a Scheduled Offense Under Anti-Rape Act 2021: Shift in Jurisdiction to Magistrate Courts

Dated: 6/27/2025 by Muhammad Umar Hashmi

In a notable development under the Anti-Rape (Investigation and Trial) Act, 2021, the government has officially removed Section 354 of the Pakistan Penal Code (PPC) — which deals with “assault or criminal force to a woman with intent to outrage her modesty” — from the list of scheduled offences. This legal shift carries important implications for how such cases are processed within the country’s judicial system.

As a result of this change, Magistrate courts now hold the jurisdiction to take cognisance and conduct trials for offences under Section 354 PPC. Previously, such cases were handled by Special Gender-Based Violence (GBV) Courts set up under the Anti-Rape Act framework.

Judicial Focus Realigned

The rationale behind this amendment is twofold:

1. Reduce the burden on Special Courts by delegating less severe cases to lower courts.

2. Enable Special Courts to concentrate their resources and attention on more heinous sexual offenses, such as rape, gang rape, and child sexual abuse.

Legal experts note that this move is expected to streamline the case backlog in GBV courts and optimise the judicial process, ensuring that more severe and traumatic offences receive faster and more focused judicial attention.

A Step Toward Efficiency

While Section 354 PPC still remains a criminal offence under the law, its reclassification reflects a broader shift in legal strategy, prioritising judicial efficiency without diluting the seriousness of gender-based violence.

Critics have urged vigilance to ensure that the transfer of such cases to Magistrate courts does not result in delays or compromised justice, especially in rural or under-resourced areas. However, proponents argue that with clear procedural guidelines and oversight, this change will contribute to a more effective, tiered justice system.

Supreme Court Reaffirms Right of Appeal as a Substantive Right: Key Clarifications on Oral Gifts Under Islamic Law

Dated: 6/27/2025 by Muhammad Umar Hashmi

In a significant judgment delivered in C.P.L.A. 479-K/2023 (Muhammad Dawood v. Mst. Sakeena Farooque @ Aziza & others), Mr. Justice Muhammad Ali Mazhar of the Supreme Court of Pakistan has issued an important ruling affirming the right of appeal as a vested, substantive right and clarifying principles regarding oral gifts under Islamic law, especially in light of the Transfer of Property Act, 1882 and the Registration Act, 1908.

Right of Appeal: Not Just Procedure, But a Fundamental Legal Remedy

The court emphatically stated that the right of appeal is a substantive legal right, and not a mere procedural formality. It held that this right must be conferred through statute (the Act) rather than subordinate legislation (Rules). Reinforcing this well-settled legal principle, the judgment noted:

“A right of appeal is the right of entering into a superior court and invoking its aid and interposition to redress the error of the forum below. It is essentially a continuation of the original proceedings…”

Justice Mazhar clarified that appellate courts are not only empowered to affirm, but also modify, reverse, or vacate lower court decisions. The grounds for appeal may include misreading or non-reading of evidence, or errors of law or fact — thus reflecting a litigant’s essential safeguard against judicial error.

Substantive vs. Procedural Law: A Critical Distinction

The Court revisited the foundational distinction between substantive law — which governs rights and obligations — and procedural law, which outlines the mechanisms and processes through which these rights are enforced. Drawing on jurisprudential thought, including Salmond, the Court emphasized that substantive law defines the ends of justice, whereas procedural law provides the tools to attain those ends.

Oral Gifts and Muslim Law: Beyond the Registration Act

The judgment also delves into the validity and evidentiary requirements of oral gifts under Islamic law, particularly in light of the Transfer of Property Act, 1882, and the Registration Act, 1908. Section 122 of the former defines a gift as a voluntary, non-consideration-based transfer of property, while Section 123 mandates registered instruments for gifts of immovable property — except where Islamic law provides otherwise under Section 129.

The Court recognized that while oral gifts of immovable property are permissible under Muslim law, they are still subject to strict proof. The key elements for a valid oral gift include:

• Tender (offer)

• Acceptance by the donee

• Delivery of possession

Justice Mazhar stressed that even when registration is not compulsory, parties must establish the factum of gift beyond doubt — especially when the gift is challenged. Registration, though optional under Islamic principles, acts as constructive notice and strengthens the authenticity of the transaction.

Importance of Document Registration

Under Section 17 and Section 49 of the Registration Act, any unregistered instrument that is otherwise required to be registered cannot create, transfer, or extinguish rights in immovable property. The court reaffirmed that registration:

• Provides pre-appointed evidence

• Acts as a public record

• Protects against fraud and forgery

• Ensures transparency in ownership

Thus, even when exemptions under Muslim personal law apply, the burden of proof becomes significantly heavier in the absence of a registered deed.

Key Takeaways

• Right of appeal is substantive, not procedural, and must be provided in the main Act.

• Appeals are a continuation of litigation, not a fresh cause.

• Oral gifts under Islamic law are valid but require strict and credible proof.

• Registration, while not mandatory for oral gifts, strengthens the validity and reduces future disputes.

This ruling has clarified some grey areas in the intersection between procedural safeguards, Islamic jurisprudence, and property law, and is being widely welcomed in legal and academic circles for its precision and doctrinal clarity.