AI Structured Summary
Not yet generated for this judgment
Judgment
M.D. Shah,J.
This petition u/s 482 of the Code of Criminal Procedure has been filed by the Petitioner for quashing of First Information Report being C.R. No. I-10 of 2010 filed with Gandhinagar Zone Police Station.
Short facts are that a complaint was filed by the original complainant-present Respondent No. 2 in the capacity of In-Charge Regional Manager, Gujarat Industrial Co. Op. Bank Ltd., Surat region, before the CID Crime, Economic Cell, Gandhinagar Zone Police Station, against 65 persons being C.R. No. I-10 of 2010 for the alleged offences punishable under Sections 406, 409, 420, 465, 467, 468, 471, 477(A) and 120(B) of the Indian Penal Code and u/s 46 of the Banking Regulation Act. It was inter alia alleged that the Petitioner with other accused persons in connivance with Shri A.K. Raval, Bank Officer in utter disregard to the guidelines of the Reserve Bank of India and in complete violation of Banking Rules, with ulterior and oblique motive as well as with dishonest intention fraudulently and illegally advanced and caused to be disbursed loans causing huge loss to the bank thereby putting the confidence instilled in the bank at stake of the depositors consisting of Cooperative societies, trusts, Senior Citizens, retired employees, middle class people, widows and pensioners.
Heard learned Senior Counsel, Mr. K.G. Vakharia for Mr. M.K. Vakharia, for the Petitioner-original accused No. 14, learned advocate, Mr. K.J. Panchal for the Respondent No. 1 and learned APP, Mr. L.R. Pujari, for the Respondent No. 2.
It is submitted by learned Senior Counsel, Mr. Vakharia for the Petitioner that the Petitioner, a Principal of Arts and Commerce College, Rajkot, and an elected member of syndicate of Saurashtra University, was elected as a Director of the Rajkot District Cooperative Bank Ltd. on 31st July, 2005 and his tenure as Director commenced from 8-8-2005 till 16-8-2008 when the Board of Directors came to suspended with effect from 16-8-2008 in pursuance of order passed by appropriate authority of Reserve Bank of India u/s 36AA of the Banking Regulations Act, 1949. Although he tendered his resignation on 14-9-2007, it was rejected vide letter dated 8-10-2007. It is further submitted that the Petitioner being Director elected from the Saurashtra Region (Rajkot Region) became ex-officio member and was elected Chairman of the regional committee. It is further submitted that said Board of Rajkot Regional Committee was empowered to sanction loan up to Rs. 3,00,000/- and in case of seeking of loan exceeding this amount, it has to be forwarded to the Board of Directors of bank. Taking this Court through the FIR, it is submitted that the borrowings are taken during period from 2000 to 2004 and disbursement of loans/advances including taking of securities against such borrowings were completed prior to end of 2004. According to him, the Petitioner was not in any way connected with the bank during the said period when the borrowing transactions took place nor were the borrowers relatives, friends or acquaintance of the Petitioner. It is further submitted that accused No. 1-Shri Ashokkumar Krishnakumar Raval was the Regional Manager-cum-General Manager and was the trusted officer of Chairman and the complainant was the trusted officer of accused No. 1. It is further submitted one Shri B.R. Diwanji, who is at present working as Chief Executive Manager/Managing Director of the bank is not arrested nor any action has been taken against him though being the prime accused. It is further submitted that Section 52 of the Multi-State Cooperative Societies Act, 2002 provides powers and functions of the Chief Executive, who is responsible for day-to-day management of the business of multi-state Cooperative Society as well as for signing the documents on behalf of the bank and also for maintainance of books and records of the bank. As per bye law No. 38 of the bank, powers and duties of Chief Executive Officer includes scrutiny of borrowers'' application, making reports, recommendations to the board, responsibilities regarding taking deposits and financial transactions of the bank and the Board relies upon the report and recommendation submitted by the Chief Executive Officer. It is further submitted that the role played by the present Petitioner is much less than the role played by the Managing Director who is the main accused. According to him, none of the ingredients of criminal breach of trust, cheating or forgery or under the Banking Regulation Act are satisfied in case of the Petitioner and hence, no cognizance can be taken on the basis of the complaint against the Petitioner. It is also submitted that as the Respondent No. 1 is not the specially authorized Officer of the Reserve Bank of India, he cannot file the complaint u/s 46 of the Banking Regulation Act. Hence, according to him, with ulterior motive and with mala fide intention and also to ruin the career of the present Petitioner, he was falsely involved in the crime. It is further submitted that there is nothing on record to show that he is the conspirator in committing the crime as he was not Director before 2005 when major offence is alleged to have taken place and tenure of the Petitioner as Director of the bank was for a short period from 8-8-2005 to 16-8-2008. It is also further submitted that since ingredients of offences alleged against the Petitioner are prima facie not found satisfied, the complaint in question requires to be quashed and set aside qua the Petitioner. He has relied on the following reported decisions:
1) M.A.A. Annamalai Vs. State of Karnataka and Another,
2) V.P. Shrivastava Vs. Indian Explosives Ltd. and Others,
3) Maharashtra State Electricity Distribution Co. Ltd. and Another Vs. Datar Switchgear Ltd. and Others,
4) Asoke Basak Vs. State of Maharashtra and Others, and
5) Dr. Gulshan Prakash and Others Vs. State of Haryana and Others,
It is submitted by learned advocate, Mr. K.J. Panchal, for the Respondent No. 2 original complainant that because of act, commission and omission on the part of the Petitioner and other accused who have taken huge loans by conniving with original accused, Shri A.K. Raval, the bank has been put to a heavy loss and for which, Board of Directors including the Petitioner are responsible. It is further submitted on the basis of inspection report dated 20-9-2008, Shri V.A. Das, Executive Director, Reserve Bank of India, vide notification under the Banking Regulation Act, 1949 (AACS) suspended the entire Board of Directors on 16-8-2008 applying Section 35A read with Section 36AAA of banking Regulation Act, 1949 and presently the administration is being handled by the Administrator appointed by Reserve Bank of India. According to him, role of the present Petitioner is specifically narrated in the FIR. It is further submitted that correct valuation of the properties mortgaged with the bank by way of securities were not shown and the accounts of persons who have taken or to whom loans were sanctioned became Non-Performing Accounts and by not disposing of and adjusting the properties put by the borrowers as security towards loan, they were shown under the had of Non-Banking Assets. It is further submitted that by showing such properties in said Non-Banking Assets, the loan account of the borrowers would be credited and Non-Banking Assets Account with the bank would be debited thereby showing dues and loan accounts of borrowers as settled and then closed. It is further submitted that during the tenure of the present Petitioner as Director, the Board of Directors in conspiracy with accused No. 1 and borrowers of the bank sold the property of Rs. 60,48,000/- in Rs. 16,50,000/- as per the authorization given by the Executive Committee in its meeting on 31-1-2006 to the Vice Chairman Shri Parmanand Bardolia and one Shri Amrutlal Gonavala thereby causing huge loss of Rs. 43,98,000/- to the bank and wrongful gain to one Shri Bhagwandas Zariwala group. It is further submitted that another instance involving the Petitioner is that at the time of disbursement of loan to Praful Shah to the tune of Rs. 4.00 crores and Navin Thakkar group to the tune of Rs. 16.00 crores in 2001, lands of Laxmipura area were put by securities by these two persons and whey their loan accounts became Non-Performing Accounts, their properties were shown Non-Banking Assets on 11-3-2005 and the Executive Committee consisting of the Petitioner in the capacity of Director took a decision to sell the said land to one Giriraj Corporation on 3-1-2006 in Rs. 13.00 crores without following proper procedure of sale by making a show of inviting acquaintances and associates at the auction. It is further submitted that the Petitioner in collusion with the borrowers disbursed loans by acting against the interest of the bank and its depositors thereby actively participating in alleged commission of offences by remaining present in the crucial and important meetings and by said act, omission and commission of the Board of Directors including the present Petitioner, a huge loss of Rs. 7.00 crores was caused to the bank in one such transactions. It is submitted that if the Petitioner was innocent, he ought not to have raised objections and ought not to have signed the resolutions when crores of rupees were sanctioned. According to him, since the entire case is totally dependent upon the documentary evidence, it is a matter of trial. It is therefore requested that the present petition requires to be dismissed. He has also relied on the following decisions:
1) Amar Singh Vs. Union of India (UOI),
2) State of Orissa and Another Vs. Saroj Kumar Sahoo,
3) Arvind Pandalai (Chairman-Cum-Managing Director) S.T.C.I.L. and Another Vs. State of Gujarat and Another,
4) State of Karnataka Vs. M. Devendrappa and Another,
5) Mir Nagvi Askari Vs. C.B.I., and
6) Ram Narain Poply, Pramod Kumar Manocha, Vinayak Narayan Deosthali and Harshad S. Mehta Vs. Central Bureau of Investigation and Others,
Learned APP, Mr. L.R. Pujari, while adopting the submissions canvassed by the learned advocate on behalf of the original complainant, has submitted that in view of the fact that the charge sheet is filed against all the accused including the present Petitioner, this Court may not exercise discretion u/s 482 of the Code of Criminal Procedure especially when ingredients alleged against the Petitioner are prima facie satisfied. Looking to the specific role alleged against the Petitioner in the charge sheet, no benefit should be given to the Petitioner. He also urges to dismiss the petition. He has also relied on the following reported decisions:
1) Arvind Pandalai (Chairman-Cum-Managing Director) S.T.C.I.L. and Another Vs. State of Gujarat and Another,
2) Iridium India Telecom Ltd. Vs. Motorola Incorporated and Others, and
3) State of A.P. Vs. Gourishetty Mahesh and Others, .
Having heard the learned advocates for the respective parties and having gone through the papers of charge sheet, it appears that case totally depends upon documentary evidence. It also appears that in the meetings when crores of rupees were sanctioned, the present Petitioner had participated and signed the resolution. Thus, it is prima facie evident that directly or indirectly, the Petitioner has become part of transaction that took place in causing huge financial loss to the bank. It is pertinent to note that investigation is now complete and hence, at this stage, this Court cannot look into the materials and appreciate the evidence as it may prejudice the parties at the time of trial. Therefore, at the stage when prima facie ingredients of offence alleged against the Petitioner are satisfied from the papers, it requires trial.
It has been held by the Hon''ble Apex Court in the cases of Mahesh Choudhary Vs. State of Rajasthan and Another, and Central Bureau of Investigation Vs. A. Ravishankar Prasad and Others, that Court can quash the charge sheet if allegations in FIR or complaint do not disclose commission of offence, however, when prima facie ingredients of the offence are made out in the charge-sheet, criminal proceedings cannot be quashed. Since charge sheet is filed, remedy is available to the Petitioner to file appropriate application for discharge. This petition, however, is required to be dismissed.
This petition is dismissed. Notice is discharged.
The observations made by this Court in this judgment being made for the purpose of deciding this petition shall not prejudice the parties in trial.