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CASE NO.:

Appeal (crl.) 477 of 2000

PETITIONER:

HARDEO SINGH

RESPONDENT:

STATE OF BIHAR AND ANR.

DATE OF JUDGMENT: 11/05/2000

BENCH:

G.B. PATTANAIK & UMESH C. BANERJEE

JUDGMENT:

JUDGMENT

2000 Supp(1) SCR 222

The Judgment of the Court was delivered by BANERJEE, J. Leave granted.

This Appeal directed against the judgment and order of the Patna High Court

pertains to refusal to exercise jurisdiction under Section 482 Cr.P.C. in

the matter of discharge of the complaint against the petitioner under

Section 120B, 409, 420, 468, 471, 477A IPC read with diverse provisions of

Prevention of Corruption Act in RC No.35/85 before the Special Judge,

Patna. On the factual score it appears that the First Information Report

was lodged against one S.K. Roy, Branch Manager, Birpur Branch of Central

Bank of India alleging inter alia that in connivance with some other named

accused he has cheated the Bank to the tune of Rs. 7,47,000 by misusing his

official position, and thus, wrongful loss to the bank to the above extent

and wrongful gain to himself and others having entered into a criminal

conspiracy with Ved Prakash Agrawal, Satya Narain Agrawal and M/s Arun

Khadya Tel Udyog. During the course of investigation by Central Bureau of

Investigation (CBI), the present Appellant's name surfaced from the record

that the latter having an Account in the Bank made an application on 8th

February, 1985 for sanction of loan of Rs. 14 lakhs for urgent payment of

labourers in contract work. It has also come to light that the Branch

Manager S.K. Roy has given sanction and allowed a total amount of overdraft

facility to the extent of Rs. 21,50,000 on different dates to the

Appellant. It is this grant of overdraft facility which have been very

strongly criticised by Mr. Altaf Ahmed, the learned Additional Solicitor

General Mr. Ahmed contended that the Branch Manager of the Bank has had no

power to the grant of overdraft facility beyond a sum Rs. 10,000 and this

accommodation to the appellant herein is, obviously, for reasons not far to

seek. The contextual facts depict that inspector of Police, SPE, CBJ, Pama

Shri Jyoti Kumar lodged an FIR being RC No, 35/85 Patna wherein It has been

alleged as below:

"An information has been received through a reliable source that Shri S.K.

Roy, while functioning as Branch Manager, Birpur Branch of Central Bank of

India during the period 1983 to 1985 entered into a criminal conspiracy

with S/Shri Ved Prakash Agrawal, Satya Narain Agrawal, M/s Arun Khadya Tel

Udyog and others and cheated the Central Bank of India to the tune of Rs,

7,47,000 by misusing his official position and thus caused wrongful loss to

the Bank to the extent of Rs, 7,47,000 with corresponding wrongful gain to

himself and others.

2. It is alleged that Shri Ved Prakash Agrawal applied for loan and filled

up only the amount of finance required by him leaving all the other

particulars including the nature of business blank in the loan application

form. Shri S.K. Roy, Branch Manager sanctioned Rs. 10,000 cash credit open

limit on adhoc basis pending regular proposal and sanction Shri S.K. Roy

also fraudulently and dishonestly allowed the party to draw to the extent

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of Rs, 2,57,655.55 without knowing the nature of business and without

obtaining the financial statement, financial report, inspection report and

stock statement.

3. It is alleged that there was no shop/establishment in the name of Shri

Ved Prakash Agrawal.

4. It is alleged that Shri Ved Prakash Agrawal (A-3) was fraudulently and

dishonesty allowed by Shri S.K. Roy (A-l) to withdraw to the extent of Rs.

89,464.10 without any loan application, proposal, sanction, financial

statement report, stock statement and inspection report. It is also alleged

that this also is a fake and fictitious financing since there is no

establishment/shop in the name of Shri Satya Narain Agrawal.

5. Further it is alleged that M/s. Arun Khadya Tel Udyog (A-7) was allowed

by A-l Shri S.K. Roy to draw to the extend of Rs, 4,94,620.50 without

regular proposal, sanction, financial statement, financial report and

inspection report. All the documents are blank, undated and unstamped.

6. It is also alleged that Shri S.K. Roy (A-1) made fictitious finance as

term loans even to the citizens of Nepal. A few names given in the records

of the bank with their addresses from Nepal are as under:-

(i) Bihari Mandal, Biral Nagar, Nepal.

(ii) Nageshwar Mandal, Inarwa, Nepal.

(iii) Narain Prasad Shah, Lahi, Nepal.

(iv) Deo Narain Yadav, Lahi, Nepal.

(v) Jageshwar Mandal, Bhim Nagar, Nepal.

7. It is learnt that Birpur Branch is a medium grade Branch and the

financial competence of the Branch Manager in respect of over draft is Rs.

10,000 only. Shri S.K. Roy, A-l transgressed his financial competence and

allowed the following clean over drafts and that to the same parties

several times on different dates:-

1. Shri Hardeo Singh: Rs. 13,50,000 on 28 1.85 and Rs. 14,00,000 on

16.2.85.

2. Shri D.M. Tiwari: Rs. 1,00,000 on 13.3.84, Rs. 1,00,000 on 28.6.84

and again Rs. 1,50,000 on 23.6.84.

8. The aforesaid facts disclose, commission of offence U/S S120B, 409, 420,

468, 471, 477A IPC and 5(2) r/w 5(1)(c) & (d) of the P.C. Act (Act II of

1947) by Shri S.K. Roy, Branch Manager, Central Bank of India, Birpur

Branch, Shri Ved Prakash Agrawal, Shri Satya Narain Agrawal, M/s. Arun

Khadya Tel Udyog all of Birpur and others,"

While it is true that the First Information Report has not named the

appellant herein but the appellant's name does figure as a person receiving

loan on clear breach of financial obligation. The facts depict that the

appellant was however, subsequently made an accused and the chargesheet

No.7/87 submitted by the SPE (CBI) Patna in the Court of Special Judge,

CBI, Patna was filed against the appellant, wherein it has been stated:

"Shri Hardeo Singh, a contractor having an Account No. 335, in the Central

Bank of India, Birpur Branch, made an application on 8.2.85 to the Branch

Manager of the said Bank for sanction of Rs. 14 lacs for payment to

labourers in a contract work. The said Shri roy put his remarks on the said

letter "allowed Rs.14 lacs in view of the parry's difficulty." The said

Shri Roy allowed overdraft of Rs. 21.5 lacs on different dates to the said

Shri Hardeo Singh in the same fashion.

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In this way the said Shri Roy allowed the overdraft facility to the tune of

Rs.35.5 Jacs fraudulently and dishonestly to the said Shri Hardeo

Singh."

The records depict further that the learned Special Judge, North Bihar,

Patna took cognizance of the matter and issued summons in terms of his

Order dated 12th August, 1987 and the Appellant in terms thereof appeared

before the Special Court and was granted Bail. Subsequently, however, upon

receipt of the copies of the documents, the Appellant moved an application

in Special Case No. 115/85, before the Special judge, CBI for discharging

him of the case and to drop the proceedings against him. Similar

application for discharge was also filed by other accused persons and the

Special Court in a common judgment came to a conclusion that there are

sufficient materials existing for a prima facie case against the accused

person for framing of charges. The Appellant herein as against the order as

above, moved the High Court under Section 482 Cr.P.C. to quash the

proceeding against the petitioner pending before the Court of Special

Judge, CBI, North Bihar, Patna. The High Court, however, dismissed the

application of the Petitioner and hence the Appeal before this Court.

Mr. Mishra, the learned Senior Advocate very strongly commented upon the

factum of total omission of repayment of the loan in the charge by the

Appellant herein within forty six (46) days, being the shortest possible

time. Be it noted that similar submission was also made before the High

Court and the learned Single Judge though recorded the same but did not

take note of the same by reason of the submission of the learned Advocate

appearing for CBI that the court below decided the matter, has come to a

positive finding that there are material evidence against the Petitioner

for framing of charges and as such the Court ought not to intervene or

interfere in exercising its inherent jurisdiction.

Apart from the above, the accusation against Shri S.K. Roy and Shri B.N.

Choudhary is also of some significance and as such the same is set out

herein below:

"The said Shri S.K. Roy and Shri B.N. Choudhary were in habit of receiving

illegal gratification from Shri Ved Prakash Agrawal which is evident from

the entries made in personal diaries of Ved Prakash Agrawal and the account

of Sri Roy." (Emphasis supplied)

It is on this score also Mr. Mishra very strongly contended that a specific

person has been named in the matter of formation of habit so far as illegal

gratification is concerned and since the appellant's name does not find any

place, question of continuation of proceedings as against the appellant

does not arise. It is no doubt true that only one person has been named to

be providing the illegal gratification but does that mean and imply release

of another beneficiary of largess of the Branch Manager and it is on this

score the totality of the situation shall have to be scrutinised in a

little more greater detail. It appears that the appellant herein has

obtained some overdraft facilities from the Bank which is stated to be much

beyond the financial power of the Branch Manager but paid back the same

within 46 days inclusive of all interests therein and the Branch Manager is

in the habit of receiving illegal gratification from Shri Ved Prakash

Agrawal which is apparent from the entries in the personal diary of Shri

Ved Prakash Agrawal and account of S.K. Roy. The charge pertaining to the

appellant, therefore, is restrictive but allowing him overdraft of Rs. 21.5

lacs on different dates which stands repaid alongwith interest and which

according to the charge is much beyond the financial powers of the Branch

Manager also needs a probe. The chargesheet has been filed against the

persons named in the charge, including the appellant under Sections 120B,

420, 418, 467, 477A of the IPC and Sections 5(1 )(a), 5(l)(c) and 5(1 )(d)

of the Prevention of Corruption Act for taking cognizance and the Special

Judge did take cognizance in regard to such offences so far as the

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Appellant is concerned.

True there is no accusation that the account of Roy depicts a balance which

is much higher than the amount shown in the personal diary of Shri Ved

Prakash, but two several sums of Rs. 60,000 have been stated to have been

deposited on 14.2.85 and 26.3.85 which though by itself not, connote any

culpability of the Appellant Hardeo Singh, neither the same however proves

his innocence at this juncture. There may not be any direct evidence

against the appellant herein as regards the payment of illegal

gratification by the appellant to the Branch Manager or the Accountant, but

factum of having enjoyed the privilege of having large sums of money on

term loans without any authorisation to allow the same obviously raises

some eye-brows somewhere and this is inspite of the fact of repayment of

the term loan with interest: The question cannot be avoided as to the

reasons for such an act which stands beyond the powers-Is this a purely

customer and the Bank relationship or something else-This is what is to be

investigated more so having regard to this so-called habit of Roy as

noticed above.

Mr. Altaf Ahmed, Additional Solicitor General, contended that there is a

charge under Section I20B and as such, question of setting free the

Appellant at this stage of" the proceeding does not and cannot arise. Mr.

Ahmed contended that the offence under Section 120B, is an independent

offence, and while it is true that the gist of the offence, is the

agreement between two or more offenders but particular facts of the

conspiracy need not even be show in the charge. Some general evidence

pertaining to the conspiracy would be sufficient to form part of the charge

of conspiracy in the chargesheet. As a matter of fact some connecting link

or connecting factor somewhere would be good enough for framing of charge

since framing of charge and to establish the charge of conspiracy can not

possibly be placed at par: To establish the charge of conspiracy, there is

required cogent evidence of meeting of two minds in the matter of

commission of an offence-in the absence of which the charge cannot be

sustained-This is however not so, in the matter of framing of charge since

the incidence of the offence shall have to be investigated. It is on this

count Mr, Additional Solicitor General contended that since conspiracy is

generally a matter of inference and since Appellant herein did take

advantage of the overdraft facility knowing fully well that the same is

beyond the financial limits of the Branch Manager, the natural inference

may be drawn that the same must have been done upon some other

consideration and it is the assessment of the same which should prompt this

Court not to toward such an attempt.

The criminal purpose in the matter cannot possibly be ruled out as against

the appellant. The allegation pertains to the factum of the habit of Branch

Manager, of receiving illegal gratification from Shri Ved Prakash Agrawal,

however, by itself, in our view, may or may not be sufficient to bring home

the charge of conspiracy but that by itself would not authorise the court

to call it a day in regard to the charge of conspiracy on the wake of the

factual matrix of the situation at this stage of proceedings. Criminal

prosecution does not necessarily mean harassment and in the event the

prosecution of this nature is allowed to be continued, it would not be in

our view a travesty of justice or any undue prejudice or even otherwise

prejudicial, since ultimately in the event the charge is not proved, he

would be acquitted. The Counter Affidavit filed by the respondents herein

does disclose some materials for scrutiny against the appellant as such we

are unable to render any assistance to the appellant herein.

In that view of the matter this Appeal foils the order of the High Court as

passed by the learned Single Judge cannot and ought not to be interfered

with on the given set of facts as noted above. There shall, however, be no

order as to costs.

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