Chapter II
Circumstances of Misappropriation and Theft
The dishonest misappropriation or theft of public property defined as a breach
of statutory law and official trust within Myanmar’s legal framework. Under
contemporary statutes, including the Public Property Protection Act and the Penal
Code, the legal system penalizes the prejudicial acts. These prejudicial acts
encompass negligence, mismanagement, and illicit dealings by custodians that result
in the deterioration or loss of state assets. These acts may be analysed into two,
misappropriation by public servants and theft of state-owned property.
Misappropriation by public servants may be involved accidental misappropriation and
dishonest misappropriation. On the other hand, theft of state-owned property may be
involved unauthorized taking and theft with intention.
2.1 Misappropriation by Public Servants
A public servant holds a fiduciary duty to protect and properly manage state-
owned resources. When a public servant uses, converts, or misapplies government
assets for unauthorized purposes, it constitutes an abuse of public trust. Under the
legal framework, these actions are analysed based on the presence or absence of
criminal intent. Within the context of Myanmar’s legal jurisprudence, criminal
misappropriation by a public servant constitutes a severe breach of criminal law and.
Under Section 409 of the Penal Code, public servants such as legal officers, who are
entrusted with property face strict liability if they dishonestly misappropriate or
convert that property for unauthorized use.
2.1.1 Accidental Misappropriation
Accidental misappropriation occurs when a public servant misapplies, retains,
or loses public property due to administrative oversight, genuine mistake, or
negligence, rather than a dishonest intention to cause wrongful gain or loss.
In criminal law, the lack of a guilty mind generally prevents an act from being
penalized as a severe criminal offense like theft or criminal breach of trust. Because of
misappropriation means taking and using money dishonestly.1
Accidental misappropriation by public servants is treated as a strict liability
issue where the absence of criminal intent does not negate legal and financial
1
Bryan A. Garner. (2000). Black's Law Dictionary. 7th edition. p.811.
accountability. While genuine mistakes avoid criminal charges, officials are still
strictly required to repay funds and may face administrative or disciplinary action. 2
In the case of U Kyaw Myint v. The Union of Myanmar3, the Special
Criminal Court of Pyay examined the charge alleging that the appellant, U Kyaw
Myint, while serving as a Township Co-operative Officer, systematically
misappropriated on various occasions the sum of 196.65 Kyats from the total funds in
his custody. Then he has been charged under Section 3 of the Public Property
Protection Law.
The court held that ‘‘since the appellant assumed responsibility to clear the
accounts and refund the outstanding balances, it would only be fair and equitable to
grant him a reasonable period to do so. If despite being granted such time, the person
fails to provide a satisfactory explanation, a comprehensive departmental inquiry
should still be duly carried out. Only after such successive stages of investigation, and
if dishonest misappropriation is clearly established, should criminal prosecution be
initiated. The prosecution does not dispute that the appellant had the authority to hold
and disburse the petty cash. No precise maximum limit was prescribed as to the
amount of cash he could hold in hand. To constitute a criminal offense, there must be
clear evidence of dishonest misappropriation for personal gain or a fraudulent intent.’’
And decided that the conviction found, and the sentence imposed against him in
respect of the said charge are hereby set aside, and an order is passed to acquit him.
In the case of U Thein San v. The Union of Myanmar4, While serving as the
warehouse keeper for six warehouses owned by the People's Stores Corporation in
Mandalay, U Thein San was subjected to criminal prosecution and committed to the
Special Criminal Court after an inspection of the said warehouses revealed
discrepancies and shortages between the goods and the inventory records. The Special
Criminal Court of Mandalay examined the case, found U Thein San guilty under
Section 3 of the Public Property Protection Law of 1963, and sentenced him to 10
years of imprisonment.
The court held that in this case, there might have been a dereliction of duty or
negligence. However, it cannot be said that all the constituent elements of a criminal
offense have been fully satisfied. Regarding the dereliction of duty and negligence, a
2
[Link] s/misappropriation-of-public-
funds.
3
1967, B.L.R. (S.C.C.A.C.). p. 87.
4
1968, B.L.R. (S.C.C.A.C.). p. 69.
period of over three years has already elapsed from the time criminal proceedings
were initiated against U Thein San until the trial and conviction, which can be deemed
sufficient. Furthermore, departmental disciplinary action may still be taken as
necessary. Therefore, the conviction found, and the sentence imposed against U
Thein San are hereby set aside, and an order is passed to acquit him in respect of this
case.
In the case of Maung Hla Kyi v. The Union of Myanmar 5 , the appellant
Maung Hla Kyi was the section head of the Township Trade Department. Unsold
detergent powder from the Department arrived at the Returned Goods Receiving
Department. He sold these goods to the staff and laborers within the compound.
Although the proceeds of the sale were compiled and due to be deposited, the money
could not be deposited yet owing to the Thingyan office holidays and the consecutive
New Year's Day. On the day the office reopened, and the money was about to be
deposited, officials from the Bureau of Special Investigation (BSI) came to inspect,
whereupon all the readily compiled money was handed over to them and he was
charged under Section 6(1) of the Public Property Protection Act.
The court held that there is no evidence to show that the appellant committed
theft, misappropriation, or mischief of public property as provided under Section 6(1)
of the Public Property Protection Act. The appellant did not sell the goods covertly for
personal gain. It is evident that the goods were sold to the staff. The method of
depositing the money was not the procedure followed by the department; therefore, it
is only a matter of considering whether or not it complies orderly with departmental
rules and procedures.
If a public servant mistakenly takes office equipment home under the sincere
impression that they have implied authorization for official duties, they lack the
dishonest intention required for a criminal charge. However, even without criminal
intent, accidental misappropriation is not completely excused. The public servant
remains subject to departmental disciplinary actions, financial audits, or civil liability
to recover the value of the lost state property. If the public servant discovers the
mistake later but still chooses to retain or sell the property for personal benefit, the act
immediately transforms from an accidental error into a criminal offense.
5
1973, B.L.R (C.C). p. 18.
2.1.2 Dishonest Misappropriation
Dishonest misappropriation by a public servant refers to the illegal or
unauthorized conversion of public funds, assets, or property entrusted to an official
for their personal use or gain. Unlike accidental misappropriation, dishonest
misappropriation occurs when a public servant intentionally misapplies, converts, or
conceals public property for their own personal gain or to cause wrongful loss to the
state. The critical legal element is the presence of dishonest intention.
Dishonest intent involves the mindset or purpose behind an action that results
in taking or using another's property without consent. 6 According to the section 409
of The Myanmar Penal Code ,Whoever being in any manner entrusted with property,
or with any dominion over property, in his capacity of a public servant or in the way
of his business as a banker, merchant, factor, broker, attorney or agent, commits
criminal breach of trust in respect of that property shall be punished with
imprisonment for a term of twenty years, or with imprisonment of either description
for a term which may extend to ten years, and shall also be liable to fine.7
In the case of U Htay Lwin v. The Union of Myanmar 8, Two pieces of
exhibit vehicles, which had been seized along with illegal timber by the Forest
Department, were systematically handed over and placed in the custody of the Oktwin
Police Station. Police Station Officer Captain Htay Lwin, in consider with Police
Lieutenant Thein Tan and Sergeant Soe Moe Oo, entered into an agreement with
civilian accomplices to substitute the said exhibit vehicles with similar low-value
vehicles in exchange for a sum of 3 million Kyats. It was later discovered upon
inspection that the original numbers conflicted with those of the vehicles delivered to
Bago. Consequently, criminal proceedings were instituted against them under Section
409 of the Penal Code for Criminal Breach of Trust by a Public Servant.
The Court held that in this case, although there were no eyewitnesses who
directly observed the substitution of the vehicles, the circumstantial evidence is highly
compelling and substantial. The court arrived at its findings of guilt by combining the
truths extracted from those testimonies with other independent corroborative
evidence, such as the discrepancies in the original number and the photographic
records. The trial court, the Toungoo District Court, convicted Police Inspector Htay
6
[Link]
7
Section 409 of Penal Code, 1861.
8
2009, Criminal special appeal No.18.
Lwin under Section 409 of the Penal Code and sentenced him to 10 years of
imprisonment with hard labour and his special appeal was subsequently dismissed by
the Supreme Court.
In the case of U Htein Win v. The Union of Myanmar 9, U Htein Win,
Executive Engineer of the Muse Township Public Construction Enterprise,
misappropriated funds while executing routine and special maintenance works on the
Mandalay-Lashio-Bhamo-Myitkyina highway. The accused, U Htein Win, has been
misappropriated a total of 506,581.68 Kyats by fabricating purchases of materials that
were never actually procured, as well as inflating the costs of materials and labour
wages through forged invoices and vouchers during the said road maintenance
operations. The he has been charged under Section 3 of the Public Property Protection
Law, 1963.
The court held that under the depositions of the labour leaders and drivers, it
was evidently established that they were not paid in full and that the accounts had
been inflated furthermore, the arguments for the defence failed to rebut such evidence.
The Lashio District Court convicted U Htein Win and passed sentence upon him
under Section 3 of the Public Property Protection Law and the said order was
subsequently affirmed by the Supreme Court.
If a public servant purposefully alters accounting records to pocket state funds
or takes government construction materials to build their private house, they commit
dishonest misappropriation. Because public servants are trustees of national wealth,
the law treats this intentional breach of trust with extreme severity. Under Section 409
of the Penal Code, the offender can be punished with imprisonment for life, or with a
strict prison term that may extend to ten years, along with a mandatory fine.
2.2 Theft of State-owned Property
The theft of state-owned property is the illegal taking, embezzlement, or
conversion of public funds, assets, or resources by individuals or groups. Theft of
state-owned property occurs when a person dishonestly takes such property out of the
possession of the Government or a public authority without consent and with the
intention of wrongful gain. According to Myanmar legal system, theft is an offence
punishable under the Penal Code and the unlawful taking of public property is treated
as a serious matter because such property is intended for public use and benefit.
9
1998, Criminal special appeal No.29. (Mandaly).
2.2.1 Unauthorized Taking
Unauthorized taking refers to the physical removal or displacement of public
assets without any legal right or formal administrative approval. Under the general
criminal framework, this maps directly to standard theft. However, when the stolen
assets belong to the state, the act is handled under specialized legislation such as
Public Property Protection Law.
Under the Section 378 of the Penal Code, whoever, intending to take
dishonestly any moveable property out of the possession of any person without that
person's consent, moves that property in order to such taking is said to commit theft.10
Unauthorized taking can indeed constitute theft, but a criminal charge
generally requires both the physical act of taking and the intent to permanently
deprive the rightful owner of the property. Without this specific criminal intent, the
act may still be considered a civil wrong, rather than a criminal offense.11
In the case of U Than Hlaing v. The Union of Myanmar12, on the
appellant U Than Hlaing, the discrepancies were discovered in the inventory of
Myanmar traditional medicinal materials. Following an audit and account settlement,
the case was referred to the Special Criminal Court. The appellant was subsequently
convicted under Section 3 of the Public Property Protection Law and sentenced to 10
years of imprisonment, against which the appeal is preferred.
The court held that in this case the factual circumstances of the offense are
clearly established by evidence, which shows that the appellant himself opened and
operated a traditional medicine shop, his wife similarly opened a shop, and traditional
medicinal materials were witnessed being unloaded at his shop two separate
occasions. Under the Order of the Chairman of the Revolutionary Council, the
appellant is entitled to a one-third reduction of his prison sentence, and the period of
pre-trial detention is to be deducted from the total sentence. In the event, that a minor
portion of the sentence remains to be served, the appellant is permitted to be released
from custody upon executing a personal bond for good behaviour during the
remaining period.
10
Section 378 of Penal Code, 1861.
11
[Link]
12
1974, Law Journal. Vol. 1. No. 2. p. 1.
In the case of U Kyaw Tin v. The Union of Myanmar 13,On July 13, 1997, the
police team conducted a search acting on information that illegal timber was being
loaded at the port of Thabang Township. They discovered the various types of illicit
converted raw timber belonging to the first accused, U Kyaw Htay, loaded aboard a
stern-wheeled motorboat. Consequently, Police Sub-Inspector Kyaw Myint filed FIR
at the police station to initiate legal action under Section 6(1) of the Public Property
Protection Act against U Kyaw Htay, who transported the illegal timber, and U Kyaw
Tin, the owner of the motorboat. The appellant U Kyaw Tin pleaded that he was
absent from the scene and was at another location at the time of the boat rental his
wife, Daw Mya Win, had rented out the vessel in good faith under the pretext that the
timber belonged to the association and was to be transported. He further contended
that since he had no knowledge of the loading of the illegal timber, he should not be
held liable for the offense and prayed for the release and return of his seized
motorboat.
The court held that his defence that he was unaware, and his wife had hired
out the motorboat to the first accused for the purpose of carrying illegal timber cannot
be sustained. The USDA did not customarily use motorboats to transport timber. The
loading of the timber occurred at an unusual hour (18:30 hours). Given these
circumstances, the act of the second accused in renting out the motorboat to transport
converted timber without demanding any supporting official documentation cannot be
deemed to have been done in good faith. Therefore, the decisions of the original
Township Court and the subsequent appellate courts convicting him under Section
6(1) and Section 9 of the Public Property Protection Act, 1947 and ordering the
confiscation of the offending motorboat as public property.
In the above cases, although the appellants submitted a defence argument
stating that the transportation was carried out in good faith, the evidence explicitly
indicates an 'unauthorized taking' as their defence plea lacks a sound legal basis,
punitive measures were enforced against them under the Public Property Protection
Act. Therefore, unauthorized taking of public property may constitute serious criminal
offences and punishable under the Public Property Protection Act.
2.2.2 Theft with Intention
13
1999, Criminal Special Appeal No. 5 (Yangon).
Theft of public property is the unlawful taking of government-owned assets
with the intent to keep, sell, or destroy them. The intention focuses on the deliberate,
premeditated criminal mind of the offender to permanently deprive the state of its
property for personal gain or commercial profit.
Under the Section 378 of the Penal Code, whoever, intending to take
dishonestly any moveable property out of the possession of any person without that
person's consent, moves that property in order to such taking is said to commit theft.14
To establish a case of intentional theft of public property, the prosecution must
prove that the accused actively and knowingly moved the state asset with a dishonest
intention to cause wrongful gain to themselves or wrongful loss to the state.15
Under the criminal law, anyone who dishonestly takes state-owned property
without authorization can commit theft. While everyday citizens can commit this
crime, laws also heavily penalize public officials, employees, or contractors who
commit theft on public property.16
According to Section 3 of the Public Property Protection Law, whoever
commits theft, misappropriation or cheating of public property shall be punished with
transportation for life or imprisonment for a term of not less than years and shall also
be liable to a fine.17
In the case of Kyaw Win Naing v. The Union of Myanmar18, The
Appellant, Kyaw Win Naing, formerly served as the Sub-divisional Administrator of
Yezwa Sub-township, Matupi Township, Chin State. The Appellant personally
withdrew 260,000 Kyats, which had been allocated by the Ministry as staff welfare
subsidies. Instead of distributing the funds to the employees, he retained them in his
personal custody. Subsequently, on April 30, 2004, he unauthorizedly absconded from
his station of duty on a government-owned motorcycle, accompanied by the clerk, Ma
Hsaing Tial with whom he was personally involved. Consequently, the police charged
Kyaw Win Naing and Ma Hsaing Tial before the Mandalay District Court under
Section 3 of the Public Property Protection Law, 1963.
The Mandalay District Court convicted the accused, Kyaw Win Naing, and
sentenced him to ten years of rigorous imprisonment under Section 3 of the Public
14
Section 378 of Penal Code, 1861.
15
[Link]
16
[Link]
17
Section 3 of the Public Property Protection Law, 1963.
18
2006, Criminal Special Appeal No. 1 (Mandaly).
Property Protection Act, 1963, ruling that retaining state funds in personal custody
without making proper disbursements, coupled with the unauthorized removal of a
department-owned motorcycle from the jurisdiction, legally constituted criminal
misappropriation. The another accused, Ma Hsaing Tial, was cleanly acquitted on the
grounds that she merely rode on the vehicle and committed no act of theft, fraud, or
misappropriation. On special appeal, the Supreme Court affirmed the conviction and
dismissed the special appeal.
In the case of Saw Kalar and 4 others v. The Union of Myanmar19, The
Appellants Saw Maung Shwe, Saw Aung Set, and Maung Tun Kyi broke the lock of
the railway warehouse door and stole 74 pieces of wire rods. While transporting the
stolen property, they encountered the People’s Police Force, abandoned their truck
along with the stolen items, and fled the scene. Saw Kalar and Maung Aung Khin
were found to have aided, abetted, and participated in the commission of the said
offense. Therefore, they have been enforced under Section 6(1) of the Public Property
Protection Act, 1947.
The Special Criminal Tribunal of Insein found all five Appellants guilty under
Section 6(1) of the Public Property Protection Act, 1947. The Tribunal sentenced each
of them to 5 years of rigorous imprisonment. The Appellate Bench observed that the
confessions were recorded by the magistrate as voluntary. Moreover, the details in the
confessions directly aligned with the police reports, the testimonies of the eye-witness
police officers, and the statement. The Appellate Court held that the conviction was
fully intent, the evidence was legally sufficient, and the sentences imposed were not
disproportionately severe relative to the gravity of the offense. Accordingly, the
Appellate Court dismissed the appeals.
The law imposes strict liability on all such offenders, any person who
knowingly participates in the planned movement, transportation, or sale of stolen
public assets may be held fully responsible under Public Property Protection laws
19
1967, B.L.R. (S.C.C.A.C). p.41.