Section 406 PPC: criminal breach of trust, punishment and bail in Pakistan

What section 406 PPC means (section 405 in plain words)

Section 406 PPC applies when someone dishonestly uses or converts property entrusted to them, or placed under their control. The prosecution must prove entrustment and dishonest misappropriation or conversion. A loss alone proves neither.

Section 405 of the Pakistan Penal Code 1860 defines criminal breach of trust. One person gives another property, or control over it, for a purpose. The recipient then dishonestly misuses it or deals with it contrary to a legal direction or an express or implied contract.

The offence has two ingredients:

1. Entrustment: the owner handed over property, or gave the accused control over it, for a defined purpose or responsibility.
2. Dishonest misappropriation or conversion: the accused treated the property as their own, used or disposed of it contrary to the trust, or wilfully allowed someone else to do so.

Evidence must link the property to the entrustment and the later dishonest conduct. Agreements, messages, receipts and bank records may help. A broken promise or failed transaction alone is not a criminal offence.

Four everyday situations that can be a 406 case

A 406 PPC complaint may follow when someone receives property for a purpose and is accused of diverting it dishonestly. A disagreement about performance does not, on its own, prove criminal breach of trust.

• A partner receives firm collections for deposit or a business expense, then allegedly moves the money to a personal account without authority.
• An employee or cashier collects customer payments for the employer and allegedly keeps them. If the accused is a clerk or servant, section 408 may apply.
• A vehicle owner leaves a car with a dealer to sell on the owner's behalf. The dealer sells it but allegedly keeps the proceeds instead of accounting for them.
• An agent receives money to make an identified investment for the owner, then allegedly uses it personally.

For the first meeting, bring the agreement or instructions, receipts, bank statements, messages and any demand for return. Explain what the recipient could do with the property and what happened next. The lawyer can put the events in order; the client should keep the original records.

When unpaid money is a civil matter, not 406

A loan, unpaid invoice or unsuccessful business deal does not automatically make a 406 PPC case. The Penal Code's own illustration describes an agent who disobeys directions in good faith because they believe the action benefits the owner. Despite the financial loss, the illustration says the remedy is a civil action.

Police and courts look for evidence of entrustment and dishonest conversion. An unpaid loan, contract price or commercial debt may call for recovery rather than a criminal breach of trust case. The wording of a complaint does not prove how property was entrusted or when dishonesty began.

For repayment or contractual performance, consider a suit for recovery of money. A dishonoured cheque has a separate route in the guide to cheque dishonour under section 489-F. The transaction record can help identify the right remedy.

Punishment under section 406 PPC and the aggravated forms

Section 406 PPC carries imprisonment of either description for up to seven years, a fine, or both. The Penal Code was amended to set the seven-year maximum. Schedule II to the Code of Criminal Procedure 1898 still prints the older three-year figure, so this guide follows the Penal Code.

The Penal Code also sets higher penalties for forms of criminal breach of trust based on the person's role or relationship to the property:

• Section 407 covers a carrier, wharfinger or warehouse-keeper. It carries up to seven years' imprisonment and a fine.
• Section 408 covers a clerk or servant, including an employee. It carries up to seven years' imprisonment and a fine.
• Section 409 covers a public servant or specified business roles, including a banker, merchant, factor, broker, attorney or agent acting in that capacity. It carries imprisonment for life or up to ten years, and a fine.

The charge depends on the alleged entrustment and the accused person's role. A job title alone does not establish the higher section.

Is 406 bailable, cognizable and compoundable?

Section 406 is cognizable, non-bailable and not compoundable. The table sets out its procedure alongside the punishment and classification for related sections. For sections 408 and 409, the approved statutory notes give the punishment but do not state their Schedule II procedural classifications here.

Section 406 does not appear in the section 345 CrPC compounding table, so a compromise does not formally end the charge. The person cheated may compound section 420. In a 406 case, a settlement may affect bail or the evidence, but the court decides what weight to give it.

Section 406 vs 420 PPC: the difference

The distinction turns on when the alleged dishonest intention arose. In section 406, property is handed over lawfully and the alleged dishonesty comes after entrustment. In section 420, deception is said to have induced the transfer, so the alleged dishonest intention existed from the start. Courts examine the evidence and sequence of events.

For example, an owner may give a dealer a car to sell, then allege that the dealer sold it and kept the price. That points to an entrusted vehicle and alleged later conversion. If a supposed buyer used a false story to get the owner to hand over a vehicle or money from the outset, the allegation may instead amount to cheating under section 420. Documents and communications can help distinguish the two.

An FIR may cite both sections if it alleges deception at transfer and misuse afterwards. The offences have different bail and compounding classifications. Read the FIR and supporting record carefully. An allegation is not proved simply because it appears in an FIR.

Bail in a 406 case

A person seeking bail before arrest applies under section 498 CrPC; an application after arrest is made under section 497 CrPC. Section 406 is non-bailable, but its maximum sentence is below ten years and outside the prohibitory clause described in section 497(1). Courts generally treat bail as the rule and refusal as the exception, subject to the facts, under Tariq Bashir v The State, PLD 1995 SC 34. Bail is not assured.

The court may consider proof of entrustment, how the property was allegedly used, the timing, the parties' conduct and whether the dispute appears civil. Discuss pre-arrest bail with counsel for the Sessions Court. After arrest, the competent court may be the Magistrate or Sessions Court, depending on the procedural posture.

Bring the FIR, arrest or inquiry notice, agreement, bank statements, receipts and relevant WhatsApp messages to the first meeting. The client should provide a timeline and preserve originals. The lawyer reviews the record, prepares bail grounds and appears in court. The court decides the application. Read about bail before arrest and bail after arrest.

How a complainant starts a 406 case in Lahore

Before asking police to register an FIR, a complainant should organise the evidence of entrustment and alleged diversion. Usually, the first step is a written application under section 154 CrPC. If police refuse, options include an application to a Justice of Peace or a private complaint before a Magistrate.

1. Collect the record: gather receipts, instructions or an agreement, bank transfers and messages. Set out what was entrusted, its purpose and how it was allegedly diverted.
2. Make the police application: send a written request to the SHO describing the facts and seeking registration of an FIR. See how to file an FIR.
3. If police refuse: ask a lawyer about an application to the Justice of Peace under section 22-A CrPC or a private complaint under section 200 CrPC. The papers and circumstances will affect the route.
4. Consider recovery separately: if money or property is also owed, ask whether a civil recovery claim should proceed alongside the criminal complaint. Each route should address the facts it covers.

In Lahore, take the papers to a lawyer or arrange a remote consultation. The lawyer can review entrustment, identify the complaint route and prepare the application. The complainant provides accurate records, attends when required and keeps copies.

What people in Pakistan search about 406

Google search data from September 2025 to August 2026 shows that “406 ppc” averaged 1,600 searches a month, ranging from 1,300 to 1,900. “420 ppc” averaged 880 searches a month, and “section 406 ppc” averaged 320. People searched for 406 about twice as often as for 420.

These searches suggest readers want to understand an FIR, including bail and compromise. The table puts arrest and compounding beside punishment so readers can compare them together.

How Saeed Law Firm handles 406 matters

Saeed Law Firm advises complainants and accused people in criminal matters, including cases under section 406 PPC. Principal Bilal Saeed, Advocate, Punjab Bar Council, is admitted to the Lahore High Court and District Courts Lahore. The firm appears before the District Courts Lahore and Lahore High Court.

Bring agreements, receipts, bank statements, messages and any FIR. The first consultation is free at Y Block Main Market, Sector Y, DHA Phase 3, Lahore 54793, or remotely. Call or WhatsApp +92 319 4959420, or read about the firm's work as a criminal lawyer in Lahore.

Frequently asked questions

Is section 406 PPC bailable?

No. Schedule II of the Code of Criminal Procedure 1898 lists section 406 as non-bailable. A court may still grant bail because the maximum punishment is below ten years and outside the prohibitory clause. The outcome depends on the facts and the court's decision. An accused person should promptly take the FIR and relevant transaction records to a lawyer.

Is section 406 compoundable?

No. Section 406 is absent from the section 345 CrPC table, so the parties cannot formally compound the charge by compromise. A settlement may affect bail or the complainant's evidence, but it does not by itself end the criminal case. The court decides the effect of the record and applicable procedure.

What is the punishment for 406 PPC in Pakistan?

Section 406 PPC provides imprisonment of either description for up to seven years, a fine, or both. The amended Penal Code sets the seven-year maximum. The older three-year figure still printed in the CrPC Schedule II punishment column does not replace that amendment. The facts determine whether section 406 or an aggravated form is alleged.

Are 406 and 420 bailable?

Section 406 is non-bailable; section 420 is bailable under Schedule II CrPC. Both are cognizable. Their compounding rules differ: the person cheated may compound section 420, while section 406 is not compoundable. If an FIR includes both sections, review each allegation and its evidence separately.

Can a 406 case be withdrawn after a compromise?

A compromise does not formally compound or automatically end a section 406 case because the offence is absent from the section 345 CrPC list. The settlement may still matter to a bail application and the complainant's evidence. The court decides its effect, so the parties should not assume a signed settlement closes the proceedings.

Is non-payment of a loan a 406 case?

Not by itself. An unpaid loan may be a civil recovery dispute unless the evidence also shows property entrusted for a purpose and dishonest misappropriation or conversion. The timing, agreement, transfers and communications matter. Take the loan record and any demands or replies to a lawyer before deciding which route fits.