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THE rules concerning debts shall also apply to deposits. Whenever forts or country parts are destroyed by enemies or wild tribes; whenever villages, merchants, or herds of cattle are subjected to the inroads of invaders; whenever the kingdom itself is destroyed; whenever extensive fires or floods bring about entire destruction of villages, or partly destroy immovable properties, movable properties having been rescued before; whenever the spread of fire or rush of floods is so sudden that even movable properties could not be removed; or whenever a ship laden with commodities is either sunk or plundered (by pirates); deposits lost in any of the above ways shall not be reclaimed. The depositary who has made use of the deposit for his own comfort shall not only pay a compensation (bhogavetanam) to be fixed after considering the circumstances of the place and time but also a fine of 12 panas. Not only shall any loss in the value of the deposit, due to its use, be made good, but a fine of 24 panas also be paid. Deposits damaged or lost in any way shall also be made good. When the depositary is either dead or involved in calamities, the deposit shall not be sued for. If the deposit is either mortgaged or sold or lost, the depositary shall not only restore four times its value, but pay a fine of five times the stipulated value (pancbabandho dandah). If the deposit is exchanged for a similar one (by the depositary), or lost in any other way, its value shall be paid.

(Pledges.)

The same rules shall hold good in the case of pledges whenever they are lost, used up, sold, mortgaged, or misappropriated.

A pledge, if productive, i.e. (a usufructory mortgage), shall never be lost to the debtor (nádhissopakárassídet), nor shall any interest on the debt be charged; but if unproductive (i.e., hypothecation), it may be lost, and interest on the debt shall accumulate. The pledgee who does not re-convey the pledge when the debtor is ready for it shall be fined 12 panas.

In the absence of the creditor or mediator (prayojahásannidhána), the amount of the debt may be kept in the custody of the elders of the village and the debtor may have the pledged property redeemed; or with its value fixed at the time and with no interest chargeable for the future, the pledge may be left where it is. When there is any rise in the value of the pledge or when it is apprehended that it may be depriciated or lost in the near future, the pledgee may, with permission from the judges (dharmasthas), or on the evidence furnished by the officer in charge of pledges (ádhipálapratyayo vá), sell the pledge either in the presence of the debtor or under the presidency of experts who can see whether such apprehension is justified.

An immovable property, pledged and enjoyable with or without labour (prayásabhogyhah phalabhogyová), shall not be caused to deteriorate in value while yielding interest on the money lent, and profit on the expenses incurred in maintaining it.

The pledgee who enjoys the pledge without permission shall not only pay the net profit he derived from it, but also forfeit the debt. The rules regarding deposits shall hold good in other matters connected with pledges.

(Property entrusted to another for delivery to a third person.)

The same rules shall apply to orders (ádesa), and property entrusted for delivery to a third person (anvádhi).

If, through a merchant, a messenger is entrusted with a property for delivery to a third person (anvádhihasta) and such messenger does not reach the destined place, or is robbed of the property by thieves, the merchant shall not be responsible for it; nor shall a kinsman of the messenger who dies on his way be responsible for the property.

For the rest, the rules regarding deposits shall also hold good here.

(Borrowed or hired properties.)

Properties either borrowed (yáchitakam) or hired (avakrítakam) shall be returned as intact as they were when received. If owing to distance in time or place, or owing to some inherent defects of the properties or to some unforeseen accidents, properties either borrowed or hired are lost or destroyed, they need not be made good. The rules regarding deposits shall also apply here.

(Retail sale.)

Retail dealers, selling the merchandise of others at prices prevailing at particular localities and times shall hand over to the wholesale dealers as much of the sale proceeds and profit as is realised by them. The rules regarding pledges shall also apply here. If owing to distance in time or place there occurs any fall in the value of the merchandise, the retail dealers shall pay the value and profit at that rate which obtained when they received the merchandise.

Servants selling commodities at prices prescribed by their masters shall realise no profit. They shall only return the actual sale proceeds. If prices fall, they shall pay only as much of the sale proceeds as is realised at the low rate.

But such merchants as belong to trade-guilds (samvyavaharikeshu) or are trustworthy and are not condemned by the king need not restore even the value of that merchandise which is lost or destroyed owing to its inherent defects or to some unforeseen accidents. But of such merchandise as is distanced by time or place, they shall restore as much value and profit as remains after making allowance for the wear and tear of the merchandise.

For the rest the rules regarding deposits shall apply here. It explains retail sale.

(Sealed deposits.)

The rules laid down concerning unsealed deposits (upanidhis) shall apply to sealed deposits also. A man handing over a sealed deposit to other than the real depositor shall be punished. In the case of a depositary's denial of having received a deposit, the antecedent circumstances (púrvápadánam) of the deposit and (the character and social position of) the depositor are the only evidences. Artisans (káravah) are naturally of impure character. It is not an approved custom with them to deposit for some reliable reason.

When a depositary denies having received a sealed deposit which was not, however, deposited for any reasonable cause, the depositor may obtain secret permission (from the judges) to produce such witnesses as he might have stationed under a wall (gúdhabhitti) while depositing.

In the midst of a forest or in the middle of a voyage an old or afflicted merchant might with confidence put in the custody of a depositary some valuable article with certain secret mark, and go on his way. On his sending this information to his son or brother, the latter may ask for the sealed deposit. If the depositary does not quietly return it, he shall not only forfeit his credit, but be liable to the punishment for theft besides being made to restore the deposit.

A reliable man, bent on leaving this world and becoming an ascetic, may place a certain sealed deposit with some secret mark in the custody of a man, and, returning after a number of years, ask for it. If the depositary dishonestly denies it, he shall not only be made to restore it, but be liable to the punishment for theft.

A childish man with a sealed deposit with some secret mark may, while going through a street at night, feel frightened at his being captured by the police for untimely walking, and, placing the deposit in the custody of a man, go on his way. But subsequently put into the jail, he may ask for it. If the depositary dishonestly denies, he shall not only be made to restore it, but be liable to the punishment for theft.

By recognising the sealed deposit in the custody of a man, any one of the depositor's family may probably ask not only for the deposit, but also for information as to the whereabouts of the depositor. If the custodian denies either, he shall be treated as before.

In all these cases, it is of first importance to inquire how the property under dispute came in one's possession, what are the circumstances connected with the various transactions concerning the property and what is the status of the plantiff in society as to wealth (arthasámarthyam).

The above rules shall also apply to all kinds of transaction between any two persons (mithassamaváyah).

 Hence before witnesses and with no secrecy whatever, shall all kinds of agreements be entered into; either with one's own or different people, shall the circumstances of the time and place be minutely considered first.

[Thus ends Chapter XII “Concerning Deposits” in Book III, “Concernig Law” of the Arthasástra of Kautilya. End of the sixty-ninth chapter from the beginning.]