Many beggars always have puppies. They buy them on the illegal market for a few euros (dollars). The puppies are often sedated, so that they don't move around, and when they grow up who knows what happens to them.
Obviously he lives with his dogs and takes good care of them, they are much better off with him than in a crowded dog pound.
We'd rather educate than punish people. We talk to owners about their pet and try to check back with them often.