Crl.O.P.Nos.27543, 28469 & 28466 of 2025

IN THE HIGH COURT OF JUDICATURE AT MADRAS

RESERVED ON : 20.02.2026

PRONOUNCED ON : 07.04.2026

CORAM

THE HONOURABLE MR.JUSTICE M.NIRMAL KUMAR

Crl.O.P.Nos.27543, 28469 & 28466 of 2025

Gandhi ... Petitioner in

Crl.O.P.No.27543/2025

K.Lalitha ... Petitioner in

Crl.O.P.No.28469/2025

Gnanaoli ... Petitioner in

Crl.O.P.No.28466/2025

Vs.

State rep. by

The Inspector of Police,

SPE: CBI: ACB: Chennai. ... Respondent in

all Crl.O.Ps

Common Prayer: Criminal Original Petitions filed under Section 528 of

BNSS to call for the records and quash the proceedings pending in

C.C.No.11 of 2006 on the file of XI Additional Special Court for CBI Cases,

Singaravelar Maaligai, George Town, Chennai – 600 001.

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For Petitioner

in all Crl.O.Ps: Dr.A.E.Chelliah

Senior Counsel

for Mr.R.Prathaban

For Respondent

in all Crl.O.Ps: Mr.K.Srinivasan

Special Public Prosecutor

COMMON ORDER

Crl.O.P.No.27543 of 2025 is filed by B.Gandhi/A41,

Crl.O.P.No.28469 of 2025 is filed by K.Lalitha/A37 and Crl.O.P.No.28466

of 2025 is filed by Gnanaoli/A46.

2.Petitioners herein are accused in C.C.No.11 of 2006 and the grounds

raised by the petitioners are identical and the respondent is common in all

petitions, thus disposed of by a common order.

3.The petitioners are accused who are facing trial in C.C.No.11 of

2006 for the offence under Sections 120(b) r/w. 420, 467, 468, 471 IPC and

Section 13(2) r/w. Section 13(1)(d) of Prevention of Corruption Act, 1988.

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4.The case of the prosecution is that on 31.01.2024, information

received by the respondent against one V.Arulkumar, Regional Chief,

HUDCO, Chennai, S.Vijaylakshmi, Stenographer, HUDCO, Chennai,

M/s.Sindhu Developers Pvt. Ltd., T.Nagar, Chennai and others. During

investigation, the role of other accused, namely, Bhaherathi, Managing

Director of M/s.Sindhu Developers Pvt. Ltd. G.R.Venkatesh, Director of

M/s.Sindhu Developers Pvt. Ltd., P.M.Sankaran, Muralidharan and

Subramanian and 43 loanees came to light, hence added as accused. In this

case, Muralidharan and Subramanian taken as approvers. The HUDCO

NIWAS Scheme envisaged in the year 2000 for sanction of loans to

individuals for purchase of plots. Two important requirements for sanction

of loan is that the developer should be reputed one and the loan sanctioned

should not exceed 85% of the registered value of the plot including the

registration charges. A1 was the competent authority to sanction the loan

processed by the Retail Finance Unit. A2 as Stenographer is not

empowered to receive the loan applications from the loanees and to process

them. But A2 was entrusted with the work of receiving the loan applications

by A1 in pursuance of criminal conspiracy, against HUDCO Circulars. A2

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after receipt of the loan applications used to check the applications and

instruct the loanees to make suitable corrections in the application in order to

circumvent the rules and regulations of HUDCO knowing that the

information directed to be filled up is not true. A2 used to do the legal

appraisal though she is not competent to make remarks. The employment

verification of the loanees was done knowing that no such verification was

carried out and A2 pressurized the Senior Managers on behalf of A1 to

process the loan applications. A3/M/s.Sindhu Developers Pvt. Ltd.

developed a layout at Sri Krishna Nagar at No.157, Pondur Village,

Sriperumbudur Taluk and created inflated sale agreements with 43 loanees

for availment of loan under HUDCO NIWAS, on forged income proof and

false sale agreement and thereby loanees received excess loan amount from

HUDCO. The approvers Muralidharan and Subramanian, Managers in

HUDCO responsible for processing the applications submitted by the

loanees for purchase of plots. On their recommendation, Regional Chief

was sanctioning the loans. One P.M.Sankaran, Approved Valuer of HUDCO

fraudulently and dishonestly given inflated valuation report dated

08.03.2002. thus 43 loanees purchased plots at Sri Krishna Nagar, Pondur

Village, Sriperumbudur Taluk fraudulently applied for plot loan from

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HUDCO by creating a false agreement with M/s.Sindhu Developers Pvt.

Ltd. and by submitting false salary slips as income proof based on which,

loans sanctioned. In pursuance of the conspiracy, M/s.Sindhu Developers

Pvt. Ltd. represented by A4 and A5 approached the approvers, Muralidharan

and Subramanian and A1 in this case during December 2001 and requested

for extending loans for purchase of plots to prospective buyers on the basis

of sale agreements which is above the actual value of the plot and sale deed

value inflated, accepted by them. A1 wrote a letter to A3 on 19.03.2002

informing he cleared the project in financing to M/s.Sindhu Developers Pvt.

Ltd. and Company can advertise the Scheme for sale of plots. This letter

was issued by A1 even without conducting pre-sanction verification about

the worthiness of the plots which is mandatory as per the HUDCO

guidelines.

5.A1 in this case instructed the approvers to process the application

for sanction of loan on the cost of the plot including the future development

cost. During March 2002, A1 called a meeting of his subordinates instructed

them to release the loan based on the value mentioned in the sale agreement.

Despite objection from the Technical Officer that he had inspected the plots

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and the value shown in the sale agreement was much higher, A1 forced him

to give opinion as per valuation report obtained from the Panel valuer.

Though A1 was not present in the office on 05.03.2002 and he was in Delhi

in connection with the official work, he created a false note on 18.03.2002 as

though a meeting was conveyed and instructions issued. The Panel valuer of

HUDCO on 17.09.2004 pegged the value of the loand (2400 sq.feet) at

Rs.24,000/- to Rs.36,000/- at the relevant period. Thus, it is clear that A1

managed to nominate a Panel valuer A3 of his choice who readily obliged

giving inflated Valuation report including future development cost. The

loans were disbursed to the loanees who submitted fake income certificates

and further, the loanees defaulted in repayment of EMI loan within few

months of grant of loan. Hence, case registered. After investigation, charge

sheet filed in this case in the year 2006 which was taken on file in C.C.No.11

of 2006 listing 51 witnesses and documents.

6.The submission of the learned senior counsel for the petitioner in all

criminal original petitions is as follows:

(i) As regards the petitioner/Gandhi/A41 in Crl.O.P.No.27543 of 2025,

submission is that the petitioner is A41, employed in Chennai Port Trust,

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Marine Department as Fireman/Driver and retired attaining superannuation

on 31.03.2025. Because of the pendency of the case, A41 not paid any

settlement amount such as Payment of Gratuity, Provident Fund, his

promotions negatived citing the above case. The petitioner is not at fault.

The allegation against this petitioner is that he obtained false certificate from

his employer and got excess loan from HUDCO. He further submitted that

in this case A11/R.Elumalai, A15/Geetha Veeraraghavan and

A16/U.Anantharaman filed petitions for discharge before the Trial Court and

their petitions allowed. In this case, totally eight persons discharged, all

similarly placed. The specific charge against this petitioner is that the

loanees are eligible to 85% of the sale agreement, as regards petitioner is

concerned he was sanctioned loan of Rs.3,69,000/- for purchase of three

plots of 7200 sq.ft. in Nos.685, 656 and 687 on 30.07.2002. The petitioner

applied for loan on 23.07.2002, sanctioned on 30.07.2002, the first

installment was released on 01.08.2002. The petitioner is said to have

submitted false salary certificate from Chennai Port Trust, but it was the

developer of plots, who have done all the works pertaining to loan. After

disbursement of loan, now HUDCO collected the entire amount with interest

from the petitioner with some excess amount and retained by HUDCO, the

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petitioner not caused any wrongful loss, in fact HUDCO gained but

petitioner facing trial from the year 2006. The retirement benefits of the

petitioner which is around Rs.30,00,000/- not paid. In this case though there

are 43 loanees, out of them some discharged and some died. Hence, less

than 50% of 43 loanees are now facing trial. The petitioner could be a

witness but unfortunately shown as accused. The case is pending for more

than 22 years, the petitioner already paid the entire loan amount. In support

of the same, the petitioner referred to the letter of HUDCO wherein it is

recorded that as on 31.10.2006 the outstanding loan is Rs.6,81,250/- has

been paid by way of Demand Draft dated 13.12.2006 drawn on State Bank

of India vide DD.No.899663 and the letter of the petitioner to HUDCO

referring to the petitioner's loan account No.3130 and settlement of entire

loan amount produced. The HUDCO written a letter to the petitioner on

29.01.2007 confirming that the entire loan availed by the petitioner fully

repaid and there is no outstanding due against the loan amount, but informed

its inability to discharge the mortgage due to the pendency of the above case.

(ii) As regards the petitioner/Lalitha/A37 in Crl.O.P.No.28469 of

2025, it is submitted that she was employed in Government Central Press,

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Chennai as Binder Grade-II and retired in August 2006. Due to the

pendency of the above case, the original sale deed of the petitioner's plot not

released, despite petitioner paid all dues and the petitioner is now in death

bed owing to Paralytic attack and facing innumerable sufferings. The

petitioner should have been cited as witness not as an accused. The

petitioner appearing before the Trial Court for more than 20 years and this

prolonged trial had caused her life and happiness. The petitioner not

furnished any false certificate and the only allegation is that the petitioner

got excessive loan from HUDCO. In this case the co-accused A8, A11, A15,

A16, A17, A20, A24 and A34, standing on the same footing as that of the

petitioner got discharged. The petitioner was sanctioned the loan of

Rs.2,46,000/- in Loan Account No.3096 for purchase of two plots of 4800

sq.ft. in Nos.709 and 710. The petitioner applied for loan on 23.07.2002

which was sanctioned on 01.08.2002. The petitioner purchased the property

from M/s.Sindhu Developers Pvt. Ltd. who through their agent approached

the petitioner in her Office and canvassed. From the letter of HUDCO dated

25.07.2002 it is seen HUDCO not to disburse loan in part or full until the

loanee fully invested the contribution i.e., the cost of unit less the HUDCO

loan. Further, letter of offer shall stand revoked and cancelled if any

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material changes in the proposal for which loan sanctioned, is found.

Further the repayment of loan/EMI was secured by collecting post-dated

cheques. The loan application of the petitioner was verified by Technical

member of Sanctioning Committee, Law Officer of Sanctioning Committee,

Financial Member of the Sanctioning Committee and thereafter, loan

sanctioned. The outstanding loan amount of Rs.2,63,100/- was informed on

02.08.2006 and thereafter, this amount was paid by the petitioner by way of

Demand Draft drawn on State Bank of India vide DD.No.528745. The

HUDCO received the same and issued receipt dated 08.08.2006. Further by

letter dated 08.09.2006 the HUDCO acknowledged and informed that the

loan amount fully repaid and there is no outstanding balance, it also

confirmed that the property is released from all charges, but original sale

deed could not be released on the directions of CBI.

(iii)As regards the petitioner/Gnanaoli/A46 in Crl.O.P.No.28466 of

2025, it is submitted that the petitioner was previously employed in Principal

Accountant General (Accounts and Entitlement), Chennai and retired from

service in the year 2014. The charge against this petitioner is that the

petitioner submitted false salary certificate and availed excess loan from

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HUDCO. The petitioner after his retirement is now receiving provisional

pension, for no fault of him and he is now surviving with provisional

pension with hand to mouth existence. He further submitted that in this

case, A8, A17, A20, A24 and A34, all similarly placed as that of the

petitioner got discharged. The petitioner was sanctioned the loan of

Rs.2,46,000/- in Loan Account No.3158 for purchase of two plots of 4800

sq.f.t in Nos.614 and 615. The petitioner applied for loan on 30.07.2002,

which was sanctioned on 06.08.2002 and the first installment was released

on 22.08.2002. He further submitted that the petitioner paid more than the

loan amount he received from HUDCO and discharged his liability within a

period of three years from the date of granting loan, though EMI was for ten

year period. The entire amount was paid as demanded by HUDCO. The

petitioner not obtained any false certificate from his employer and the loan

amount was paid to the developers of the property, the petitioner not

received even a single rupee. He further submitted that HUDCO sent a

communication on 26.09.2006 informing the petitioner outstanding loan

amount was Rs.4,32,252/-. The petitioner paid Rs.3,99,000/- by way of

Demand Draft drawn on Indian Bank, Chintadripet Branch, vide

DD.No.215297 and another Demand Draft for Rs.43,000/- vide

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DD.No.215298 dated 29.11.2006. The HUDCO received the same,

acknowledged by receipt dated 29.11.2006. Further, HUDCO by letter dated

05.01.2007 confirmed entire loan amount discharged by the petitioner, the

mortgage of the property also discharged but document could not be released

due to the pendency of the above case.

7.The learned senior counsel submitted that earlier petitioners filed

discharge petition before the Trial Court which was dismissed, against which

they filed revision petitions before this Court along with other accused in

Crl.R.C.Nos.159/2012 and 158/2012. This Court by order dated 24.02.2015

dismissed the revision petitions that is at pre-trial stage. Now it is almost 10

years after the dismissal of the revision petitions, the trial is moving at snail

pace. Though witnesses are examined, no witness deposed against the

petitioners for charge of conspiracy between the petitioners with M/s.Sindhu

Developers Pvt. Ltd. and with the officials of HUDCO. The loanees in this

case are from various Central Government, State Government and Public

Sector undertakings, all employed then at clerical level and M/s.Sindhu

Developers Pvt. Ltd. approached the loanees in their office, canvassed for

the sale of plots in Pondur, Sriperumbudur Taluk projecting Sriperumbudur

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soon to become an industrial hub and residential plots have potential for

appreciation. True to their prediction, Multinational Companies, Automobile

giants and Software Companies mushroomed in and around Sriperumbudur

and it is now a business hub. The value of the properties jumped manifold

and the petitioners with an intention of making a small investment and to

own a property which might be useful in future after retirement either to

settle there or to make a profit out of the appreciation of the properties,

purchased two or three plots each. The HUDCO gave a loan of 85% of sale

agreement value. Now the petitioners have repaid the entire loan amount

with interest and HUDCO has suffered no loss from the loan transaction.

8.The primary ground projected is that 85% of the value must be for

the actual sale and not for the sale agreement. Hence, there was a

conspiracy between the HUDCO and M/s.Sindhu Developers Pvt. Ltd. It is

a known fact that guideline value and market value are in variance, with

huge difference between them. Going by the guideline value and getting a

loan against the market value, then no plots can be purchased. It is the

market rate which determine and confirm the real value of the property but

properties are registered on the guideline value to avoid stamp chargers and

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duties. In the year 2002, guideline value was much less than the market

value and thus, granting of loan, on the guideline value is not proper and

workable. The valuation report projected is subjective, bound to have

difference and cannot be a basis for prosecution. Further, this difference of

value taken then it is between the officials of HUDCO and M/s.Sindhu

Developers Pvt. Ltd. Not with the loanees. He further submitted that in this

case the two approvers examined as witnesses not whisper anything against

the petitioners. The entire collection of documents, submitting the same to

HUDCO was done by the sale representative of M/s.Sindhu Developers Pvt.

Ltd. and if there was any correction, it was not to the knowledge of the

petitioners. The undisputed fact is that the petitioners availed loan for a

period of ten years but within three years, petitioners repaid the entire loan

amount with interest, HUDCO received and acknowledged loan repayment

and now after payment of the entire loan amount, mortgage cancelled but

documents not released due to the instructions of CBI and now petitioners

are unable to deal with the property. In this case, admittedly HUDCO not

suffered any loss and the entire loan amount repaid. Further, the loan is of

the year 2002 and it is almost 24 years now, all the three petitioners retired

from service and their retirement/terminal benefits not paid citing the above

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case. The petitioners are surviving with the provisional pension and one of

the petitioner is bedridden with Paralytic stroke. The petitioners already

undergone ordeal of trial for more than 20 years. The objection of the

prosecution that earlier petitioners filed discharge petitions, the same

dismissed and filing of the quash petition is not permitted is not proper. The

present quash petitions filed on the ground of delay and on the ground that

the entire loan amount repaid 20 years before, HUDCO not suffered any

loss. Further, the discharge petition was at pre-trial stage and ten years

thereafter to, the trial not yet completed and the petitioners are undergoing

ordeal of trial. In this case, out of 43 loanees, around 23 loanees have either

been discharged or charged against them got abated due to their death and

petitioners are one step short of their grave. He further submitted that the

primary allegation is that A1 in this case sanctioned 43 loans knowing its

inflated sale agreement/valuation report and on forged documents, which is

against the HUDCO procedures and the loanees received part of the excess

loan released by A4 and A5 and it shows that the loan amount was not used

for the purpose for which it was sanctioned. Though such averments made

but there is no iota of evidence that there was any diversion or reverse flow

of any excess amounts. According to the petitioners, there was no excess

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amount it was only the market value for which the loan was sanctioned. He

further submitted that in this case excess loan amount was shown to be

granted to 43 loanees and similarly placed accused A11/Elumalai,

A15/Geetha Veeraraghavan, A16/U.Anantharaman, A20/N.E.Seetharaman,

A24/M.T.Rajan and A34/P.Jagannathan, all discharged from the case.

9.The learned Special Public Prosecutor filed counter affidavit to all

the three petitions. With regard to A41, it is submitted that the petitioner

earlier filed a discharge petition in Crl.M.P.No.825 of 2010 which was

dismissed, against which he filed a revision petition in Crl.R.C.No.159 of

2012 and the same was dismissed by this Court on 24.02.2025. The

petitioner cannot take umbrage referring to the discharge of the co-accused.

In this case, the co-accused, namely, A11, A15 and A16 were discharged on

the ground that no material on record to show that they forged salary

certificate and availed inflated loan amount. Further, as per records the

salary of the petitioner/A41 is Rs.17,070/- and he produced a salary

certificate where it shows gross salary as Rs.16,685.85. The Chennai Port

Trust on enquiry had given the actual salary was only Rs.11,892.98 for May

2002 and Rs.12,314/- for April 2002. This discrepancy clearly establishes

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that the salary particulars furnished in the loan application and certification

was false and forged. The petitioner by selectively citing those accused who

got discharged and attempting to mislead this Court. He further submitted

that the petitioner claimed that the entire loan amount availed by him was

repaid within three years. It is submitted that the loan in question was

sanctioned for a period of 10 years under an EMI repayment structure but on

coming to know about the petitioner obtaining loan on false certificate,

petitioner repaid the loan to avoid prosecution. He further submitted that the

case against the petitioner not only pertains to non-repayment but to the

manner in which the loan was obtained by using false and fabricated

documents. Since this Court already dismissed the revision petition filed by

the petitioners, this quash application cannot be entertained. The present

petition is nothing but a repetition on the same ground which already

considered and rejected by this Court. Successive petition on the same

ground is impermissible and constitute an abuse of process of law as held by

the Apex Court in the case of K.K.Modi vs. K.N.Modi and others reported in

(1998) 3 SCC 573 which is reiterated in Supertech Limited vs. Emerald

Court Owner Resident Welfare Association reported in (2021) 10 SCC 1.

The petitioner's personal reason of reaching superannuation and non-

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payment of terminal benefits or health ground cannot be a ground to

discharge him from a criminal case and stall the proceedings.

10.As regards the petitioner/A46, it is submitted that the petitioner

earlier filed a discharge petition in Crl.M.P.No.1184 of 2010 which was

dismissed, against which he filed a revision petition in Crl.R.C.No.158 of

2012 and the same was dismissed by this Court on 24.02.2025. The

petitioner cannot take umbrage referring to the discharge of the co-accused.

In this case, the co-accused, namely, A11, A15 and A16 were discharged on

the ground that no material on record to show that they forged salary

certificate and availed inflated loan amount. Further, as per records the

salary of the petitioner/A46 is Rs.10,145/- and he produced a salary

certificate where it shows net salary as Rs.8,115/-. The Principal Accountant

General (A&E), Teynampet on enquiry had given the actual gross salary as

only Rs.6,409/- and net salary as Rs.5,697/-. This discrepancy clearly

establishes that the salary particulars furnished in the loan application and

certification was false and forged.

11.As regards the petitioner/A37, it is submitted that the petitioner

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earlier filed a discharge petition in Crl.M.P.No.825 of 2010 which was

dismissed, against which she filed a revision petition in Crl.R.C.No.159 of

2012 and the same was dismissed by this Court on 24.02.2025. The

petitioner cannot take umbrage referring to the discharge of the co-accused.

In this case, the co-accused, namely, A11, A15 and A16 were discharged on

the ground that no material on record to show that they forged salary

certificate and availed inflated loan amount. Further, as per records the

salary of the petitioner/A37 is Rs.13,370/- but enclosed a salary slip along

with loan application which is not signed by the employer/Works Manager,

Government Central Press. The petitioner's actual salary was Rs.8,370/-.

This discrepancy clearly establishes that the salary particulars furnished in

the loan application and certification was false and forged.

12.In support of his contention, the learned Special Public Prosecutor

relied upon the judgment of the Apex Court in the case of Vikram Bakshi

and others vs. R.P.Khosla and another reported in 2025 SCC Online SC

1783.

13.Considering the submissions made and on perusal of the materials,

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the undisputed fact is that the petitioners/A41, A37 and A46 availed loan

from HUDCO for purchase of plots from M/s.Sindhu Developers Pvt. Ltd.

Out of three petitioners, two petitioners are Government employees and one

petitioner from Public Sector undertaking. The petitioner/A41 purchased

three plots, petitioners/A37 and A46 purchased two plots each. They availed

a loan of Rs.3,69,000/-, Rs.2,46,000/- and Rs.2,46,000/-. The loan availed

in the year 2002 and within three years, entire loan amount repaid with

interest by the petitioners, it is not in dispute. Hence, there is no loss to

HUDCO due to the alleged act of the petitioners. Now the other ground on

which the petitioners are prosecuted is that petitioners submitted false salary

certificates. The employers of the petitioners state there is variance in the

salary certificates submitted with the loan application and to their actual

salary received and the salary certificate is doubtful. But in this case the

person who issued salary certificate not examined and the person who signed

the disputed salary certificate not found and identified. One thing is clear

that application for purchase of plots were collected by the agents of

M/s.Sindhu Developers and submitted to HUDCO. There might be

discrepancy in the salary particulars. But it is not the case that but for the

inflated salary details, petitioners will be ineligible for the loan under

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HUDCO NIWAS Scheme. It is certain that the petitioners not created any

forged document and there is no forensic report to show linking to the

petitioners to have forged documents.

14.M/s.Sindhu Developers Pvt. Ltd. engaged agents and

representatives for promotion and sale of plots. Further, Prasanna

Christopher and Sripriya confirms involved in promotion and sale of plots to

certain loanees. Thus M/s.Sindhu Developers Pvt. Ltd. who took all steps

and measures in sales promotion and for availment of loan. The HUDCO

approval letter confirms what are the documents to be submitted and if

found any details concealed or loan application is found to be incorrect and

untrue, loan will be cancelled without further notice. The credit appraisal

cum sales note of HUDCO confirms the filling up of the details, payment

schedules and collection of post dated cheques as security and employment

details with salary particulars which is scrutinized by Technical Member of

Sanctioning committee, Law Officer of Sanctioning Committee and

Financial Member of Sanctioning Committee.

15.The petitioners have no interface with the HUDCO authorities. It

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is the agents of M/s.Sindhu Developers Pvt. Ltd. collected documents,

submit to HUDCO, the HUDCO thereafter process the same, release the

loan and credit the amount to the developer of the property, sale deed

executed, mortgage created, thereafter EMI paid and on discharge of loan

liability, mortgage to be cancelled. The loan is well secured by mortgage.

The only allegation is that over and above the eligible level, loan sanctioned

not only to the petitioners and to other loanees. The other loanees to whom

granted excess loan amount also repaid the loan amount and got discharged

from the case. The witnesses primarily speak about the procedures followed

in HUDCO violated and not followed, at the instance of M/s.Sindhu

Developers Pvt. Ltd. The two approvers Muralidharan and Subramanian

only speak about the procedure and what are the documents which are

required and collected prior to consideration and sanction of loan. They

deposed against HUDCO officials and M/s.Sindhu Developers who are

facing prosecution and nothing against loanees. There are 12 documents

which have been listed by them to be scrutinized which are as follows:

1.Original Sale Deed

2.Parent document for 30 years

3.Nil Encumbrance Certificate above 30 years

4.For plan approval by the competent authority

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5.Estimate from a license builder or valuer

6.Legal opinion to the panel advocates

7.Salary slip in case of salaried employees

8.Form-16 of IT returns for 3 years

9.Bank account statements for 6 months

10.Age proof

11.Details of the guarantor

12.Residence proof

16.Out of the aforesaid 12 documents, salary slip was found to be

produced with inflated amount. Further, eight officials during that period

were looking after the scrutiny task and processed each of loan applications.

None of these witnesses either from HUDCO or from M/s.Sindhu

Developers Pvt. Ltd. stated that the petitioners created any forged salary

certificate. The only inference now sought to be projected is that these

salary particulars given in the loan application of the petitioners are not

correct particulars, it is with inflated details, but now the entire loan amounts

repaid much before framing of charges. It is also not in dispute that case

against some of the similarly placed loanees discharged. Added to it, charge

against 12 persons abated due to their death. Thus in this case, majority of

the loanees, either discharged by the Trial Court or they are no more.

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Further, in this case loanees are Government servants and Public Sector

employees but no sanction for prosecution obtained and thus, no charges

under Prevention of Corruption Act can be framed. The respondent in the

charge sheet in paragraph 30 recorded reasons for not obtaining sanction to

the loanees for the following reason “The sanction to prosecute other loanees

who are also public servants have not obtained since the offence which they

had committed not as a public servant but in their individual capacity, hence

no sanction is required”, which may not be proper. On a plain reading of

Section 19 of PC Act, it is clear that previous sanction is necessary for

prosecution of public servants and it does not differentiate whether they have

committed the offence in their individual capacity or as public servant.

17.In the case of Lalu Prasad vs. State of Bihar reported in (2007) 1

SCC 49, the Apex Court observed as follows:

“10.It may be noted that Section 197 Cr.P.C. and

Section 19 of the PC Act, 1988 operate in conceptually

different fields. In cases covered under the Act, in respect

of public servants the sanction is of automatic nature and

thus factual aspects are of little or no consequence.

Conversely, in a case relatable to Section 197 Cr.P.C., the

substratum and basic features of the case have to be

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considered to find out whether the alleged act has any

nexus with the discharge of duties. Position is not so in

case of Section 19 of the Act.”

(emphasis supplied)

Thus, in the charge sheet at paragraph No.30 explanation given by the

Investigating Officer that “the Sanction to Prosecute other loanees who are

also Public Servant not obtained since the offence which they had committed

not as a public servant but committed in their individual capacity, hence no

sanction is required”, is against law and procedure.

18.As regards the objection of the learned Special Public Prosecutor

that the petitioners filed revision petitions against the dismissal of discharge

petitions and this Court dismissed the revision petitions, hence quash

petition cannot be filed by the petitioners is not correct and proper. The

Apex Court in the case of Harish Dahiya Alias Harish and another vs.

State of Punjab and others reported in (2019) 18 SCC 69, held that the

grounds of quashing a criminal proceedings and the reason for allowing or

disallowing application for discharge are completely different. The grounds

falling for consideration in the two jurisdictions are completely different.

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19.In the case of P.Ramachandra Rao vs. State of Karnataka

reported in (2002) 4 SCC 578, a Bench of Seven Judges while disapproving

of setting up of strict timelines for completion of investigation, observed as

follows:

“….The mental agony, expense and strain which a person

proceeded against in criminal law has to undergo and which,

coupled with delay, may result in impairing the capability or

ability of the accused to defend himself have persuaded the

constitutional courts of the country in holding the right to

speedy trial a manifestation of fair, just and reasonable

procedure enshrined in Article 21. Speedy trial, again, would

encompass within its sweep all its stages including

investigation, inquiry, trial, appeal, revision and retrial — in

short everything commencing with an accusation and

expiring with the final verdict — the two being respectively

the terminus a quo and terminus ad quem — of the journey

which an accused must necessarily undertake once faced with

an implication. The constitutional philosophy propounded as

right to speedy trial has though grown in age by almost two

and a half decades, the goal sought to be achieved is yet a

far-off peak. Myriad fact situations bearing testimony to

denial of such fundamental right to the accused persons, on

account of failure on the part of prosecuting agencies and the

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executive to act, and their turning an almost blind eye at

securing expeditious and speedy trial so as to satisfy the

mandate of Article 21 of the Constitution….”

20.In the case of CBI vs. Mir Usman reported in 2025 SCC Online

SC 2066, the Apex Court following its earlier judgments, held as follows:

………………. “31. The right to speedy trial is implicit in

Article 21 of the Constitution of India. The first written

articulation of the right to speedy trial appeared in 1215 in

the Magna Carta:“We will sell to no man, we will not deny or

defer to any man either justice or right.” Article 21 of the

Indian constitution declares that “no person shall be deprived

of his life or personal liberty except according to the

procedure laid by law.” Justice V.R. Krishna Iyer in Babu

Singh v. State of U.P., (1978) 1 SCC 579 : AIR 1978 SC 527

remarked, “Our justice system even in grave cases, suffers

from slow motion syndrome which is lethal to “fair trial”

whatever the ultimate decision. Speedy justice is a component

of social justice since the community, as a whole, is

concerned in the criminal being condignly and finally

punished within a reasonable time and the innocent being

absolved from the inordinate ordeal of criminal proceedings.”

In the case of Sheela Barse v. Union of India, (1986) 3 SCC

632 : (1986) 3 SCR 562, this Court has held that the right to

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speedy trial is a fundamental right. Further it was stated by

this Court that the consequence of violation of the

fundamental right to speedy trial would be that the

prosecution itself would be liable to be quashed on the ground

that it is in breach of fundamental right.”

21.Thus, the Apex Court held that speedy trial wold encompass within

its sweep all its stages including investigation, inquiry, trial, appeal, revision

and retrial, in short everything commencing with an accusation and expiring

with the final verdict. In this case, admittedly there had been a delay of

more than 20 years, all the petitioners now attained superannuation, one

petitioner superannuated recently and the other two petitioners decades

before. Further, one of the petitioner is paralysed, bedridden and all of them

denied of their career growth, promotion and denied their terminal benefits

which is a planned fallback for their future, a requirement for post retirement

needs including for health care. Thus, petitioners deprived of their

fundamental right. From the above facts, it is clear that continuation of

criminal proceedings pending against the petitioners before the Trial Court is

unwarranted and liable to be quashed.

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22.In the result, the Criminal Original Petitions stand allowed and as a

sequel, the proceedings pending against the petitioners in C.C.No.11 of 2006

on the file of XI Additional Special Court for CBI Cases, Singaravelar

Maaligai, George Town, Chennai – 600 001 is quashed. The petitioners are

discharged from the charges levelled against them.

07.04.2026

Index : Yes/No

Speaking Order/Non Speaking Order

Neutral Citation: Yes/No

cse

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To

1.The Inspector of Police,

SPE: CBI: ACB: Chennai.

2.The XI Additional Special Court for CBI Cases,

Singaravelar Maaligai,

George Town, Chennai – 600 001

3.The Public Prosecutor,

High Court, Madras.

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M.NIRMAL KUMAR, J.

cse

Pre-delivery order made in

Crl.O.P.Nos.27543, 28469 & 28466 of 2025

07.04.2026

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