Section 406 IPC: Punishment for criminal breach of trust

Indian Penal Code, 1860

Section 406 IPC at a Glance

Section 406 IPC deals with punishment for criminal breach of trust. It is non-bailable and cognizable, triable by Magistrate of the first class; from 1 July 2024 it is replaced by Section 316(2) BNS.

Punishment

Imprisonment of either description for a term which may extend to three years.

Non-Bailable ⓘCognizable ⓘCompoundable (with court permission) ⓘ🏛️ Magistrate of the first class ⓘ
BNS Equivalent

Section 316(2) →

Section 406 IPC Bare Act Text

406. Punishment for criminal breach of trust

Whoever commits criminal breach of trust shall be punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both.

Source: Section 406, Indian Penal Code, 1860

Section 406 IPC in Simple Words

Section 406 of the Indian Penal Code (IPC) prescribes the punishment for criminal breach of trust as defined under Section 405 IPC. Whoever commits criminal breach of trust is punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both.

The offence applies where property or dominion over property was entrusted to a person who subsequently dishonestly misappropriated, converted, used, or disposed of it in violation of the trust. Under the First Schedule to the Code of Criminal Procedure, 1973, the offence is cognizable, non-bailable, and triable by a Magistrate of the first class.

It may be compounded with the permission of the court by the owner of the property under Section 320(2) CrPC.

Ingredients of Section 406 IPC

  • Entrustment of property or dominion over property to the accused
  • Dishonest misappropriation of that property or conversion of it to the accused's own use
  • Dishonest use or disposal of the property in violation of any direction of law prescribing the mode of discharge of such trust, or of any legal contract touching its discharge, or wilfully suffering any other person to do so
  • The commission of criminal breach of trust as defined in Section 405 IPC

Punishment Under Section 406 IPC

Imprisonment

Imprisonment of either description for a term which may extend to three years.

Fine

Fine, or imprisonment, or both.

Non-Bailable ⓘCognizable ⓘCompoundable (with court permission) ⓘ🏛️ Magistrate of the first class ⓘ

Criminal breach of trust carries imprisonment of either description for a term extending up to three years, or fine, or both.

Example of Section 406 IPC

In 2019, before leaving Guwahati for a six-month training programme, Siddharth entrusted his portable diesel generator to his cousin Varun on the express agreement that Varun would keep it in his garage and return it when Siddharth came back. Instead of keeping the generator as agreed, Varun dishonestly sold it to a construction contractor and spent the money on his own household expenses. Because Varun was entrusted with the generator and dishonestly converted it to his own use, he committed criminal breach of trust, and Varun is punishable under Section 406 IPC.

When Section 406 IPC Does Not Apply

  • The property was never entrusted to the accused, nor was the accused given dominion over it.
  • The person holding the property dealt with it strictly in compliance with the law and the agreement creating the trust.
  • The accused retained or used the property under an honest belief of right, lacking any dishonest intention.
  • The matter involves a mere failure to repay a loan or settle a commercial account where no entrustment in trust existed.

Section 406 IPC in the BNS

Section 406 IPC is now covered under Section 316(2) BNS.

Section 406 IPC corresponds to Section 316(2) BNS. Section 316(2) BNS raises the maximum term of imprisonment of either description from three years under Section 406 IPC to five years, while retaining fine as an alternative or additional punishment. In addition, Section 316(2) BNS consolidates the definition of criminal breach of trust and its four distinct punishing provisions into a single section with five sub-sections.

View detailed comparison (IPC 406 vs BNS 316(2)) →

FAQs on Section 406 IPC

What does Section 406 IPC punish?▼

Section 406 IPC punishes whoever commits criminal breach of trust as defined under Section 405 IPC, by dishonestly misappropriating, converting, using, or disposing of entrusted property.

What is the punishment for criminal breach of trust under Section 406 IPC?▼

The punishment under Section 406 IPC is imprisonment of either description for a term which may extend to three years, or with fine, or with both.

Is Section 406 IPC bailable and cognizable?▼

Under the First Schedule to the Code of Criminal Procedure, 1973, an offence under Section 406 IPC is cognizable and non-bailable, and it is triable by a Magistrate of the first class.

Can an offence under Section 406 IPC be compounded?▼

Yes. Under Section 320(2) CrPC, an offence under Section 406 IPC may be compounded by the owner of the property in respect of which the breach of trust was committed, but only with the permission of the court.

How did Section 316(2) BNS change the sentence for criminal breach of trust?▼

Section 316(2) BNS increased the maximum punishment of imprisonment from three years to five years, while keeping fine as an alternative or additional punishment.

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Sources: Bare Act Text, Indian Penal Code, 1860 · Last updated: 16 Oct 2026 ·