Sri Yashwant Chaturvedi vs State Of U.P. & Another
2017 Latest Caselaw 7122 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

Reserved
 
A.F.R
 

 
Case :- CRIMINAL REVISION No. - 2685 of 2017
 

 
Revisionist :- Sri Yashwant Chaturvedi
 
Opposite Party :- State Of U.P. & Another
 
Counsel for Revisionist :- Tarun Agrawal
 
Counsel for Opposite Party :- G.A.,Amit Misra
 

 
Hon'ble Harsh Kumar,J.

Heard Sri Ravi Kant, learned Senior Counsel assisted by Sri Tarun Agrawal, learned counsel for the revisionist, Sri Amit Misra, learned counsel for C.B.I., learned AGA for the State and perused the record.

The revision has been filed against the order dated 26.7.2017 passed by Special Judicial Magistrate, C.B.I., Ghaziabad rejecting the discharge application of revisionist under section 239 Cr.P.C. in Criminal Case No.1018A of 2009, State Vs. Yashwant Chaturvedi, under sections 120B, 468, 471, 420, 409 IPC.

Learned counsel for the revisionist submits that on the basis of material submitted with the charge sheet, offences under sections 468, 471, 420, 409 and 120-B IPC are not made out against the revisionist; that the revisionist was Director of M/s Vidiani Engineers Ltd., Mathura (hereinafter referred as "VEL"), which company was involved in manufacturing of engineering equipments; that the company of revisionist obtained various amounts, as loan from different financial institutions and banks etc.; that the creditors of Company M/s Fortis Financial Services Limited filed a Company Petition No.125 of 1998 against the Company of revisionist, in which vide order dated 12.1.2006 of this Court, the application for winding up of Company was allowed; that the revisionist moved an application for recall of order dated 12.1.2006, which is pending for disposal and order has been reserved after hearing of arguments before the Company Judge; that in above Company Petition vide order dated 19.10.2006 this Court, upon taking cognizance of the offence under section 454(5) of the Companies Act, 1956 and taking into account the fact that Directors are not available, handed over the matter to C.B.I. for registering and investigating the case; that the scope of above order was limited according to which, the C.B.I. was required only to finding out addresses of Ex-Directors, arresting them and bringing them to the Court and also for finding out the exact location where the misappropriated money has been parked; that the C.B.I. exceeded its jurisdiction in lodging F.I.R., registering the case and upon completion of investigation, in submitting the charge sheet against the revisionist and others before the Magistrate for the offences under sections 468, 471, 420, 409 and 120-B IPC; that subsequent to passing of order dated 19.10.2006 by the Company Judge directing C.B.I. to investigate in the matter, the revisionist has made payment of almost all the dues of the financial institutions in futherance of one time final settlement, except certain amounts are due towards IDBI with which negotiations with regard to one time final settlement are going on; that the revisionist is hopeful of recall of order dated 12.01.2006 of the Company Judge under which the investigation was handed over to C.B.I. vide order dated 19.10.2006 of the Court; that in case, the above order dated 12.01.2006 is recalled, the entire proceedings including the subsequent order of investigation dated 19.10.2006 will come to an end; that the revisionist has not committed any offence of cheating, forgery or embezzlement and has not entered into any criminal conspiracy with co-directors or the Charted Accountant of Company VEL; that the learned Magistrate failed to consider the material on the case diary and without considering the material available on record, has rejected the application in mechanical manner; that the statement of Chief General Manager of IDBI under section 161 Cr.P.C. shows that everything was done in good faith and in accordance with rules, which indicates that no offence have been committed by the revisionist; that the learned Magistrate has acted wrongly in not going through the evidence collected by the C.B.I. and in rejecting the application merely by saying that there is sufficient evidence for framing of charges against the revisionist, which is wrong and incorrect; that the impugned order is wrong on facts and law and is liable to be set aside.

Learned counsel for the revisionist in support of his arguments has placed reliance on the decisions in the cases of (i) Badrinath Vs. Government of Tamil Nadu (2000) 8 SCC 395, (ii) Rukmini Narvekar Vs. Vijay Satardekar and others (2008) 14 SCC 1, (iii) State of West Bengal and others Vs. Committee for Protection of Democratic Rights, West Bengal and others (2010) 3 SCC 571, (iv) Kalabharati Advertising Vs. Hemant Vimalnath Narichania and others (2010) 9 SCC 437, (v) Omprakash J. Mehra Vs. Surlex Diagnostic Ltd. 2012 SCC Online Bom 1947 and (vi) Prashant Bharti Vs. State (NCT of Delhi) (2013) 9 SCC 293, which shall be dealt with hereinafter.

Per contra, learned counsel for C.B.I. supported the impugned order and contended that this Court vide order dated 19.10.2006 handed over the matter to C.B.I. for registering the case and investigating the same, in furtherance of which F.I.R. was lodged on 30.11.2006 registering Case Crime No.9(E)/06 against the accused persons and after completion of investigation, charge sheet was submitted before the Competent Court of Judicial Magistrate in accordance with law; that it is wrong to say that C.B.I. was required to submit report to the Company Judge only and even upon finding the evidence of criminal offences having been committed by the revisionist and other Ex-Directors etc. of the Company was not authorized to submit charge sheet before the Judicial Magistrate; that the revisionist and others formed a Company in the name of Vidiani Engineers Ltd., Mathura for the purpose of manufacturing the engineering equipments and borrowed huge amount of Crores of Rupees from various banks and financial institutions and misappropriated the public funds; that during investigation, considerable material evidence was collected against the revisionist and other Ex-Directors as well as Charted Accountant regarding the commission of offences under sections 468, 471, 420, 409 and 120-B IPC by them in furtherance with criminal conspiracy with each other; that the argument that in case of allowing of recall application of revisionist by the Company Judge, the entire matter will be finished, is just an emotional and hypothetical argument having no substance; that the material on record shows that the revisionist and his co-directors obtained various financial loans and facilities with dishonest intentions since inception and by committing the offence of cheating have misappropriated heavy funds; that if subsequent to lodging of F.I.R., the revisionist and his co-directors have made payment of any amount and cleared dues of any of the creditors, the wrong done by them, may not be treated to have been undone; that undisputedly the dues of IDBI have not yet been cleared; that the revisionist has not come with clean hands; that the trial court was not required to consider the impact, if any of the pendency of recall application in company petition particularly when recall of order dated 19.10.2006 was never sought by the revisionist; that in any case, on account of pendency of application of recall of order dated 12.1.2006, the revisionist may not be discharged; that the learned Magistrate has considered all the points involved at length and has rightly held that that there is sufficient prima facie evidence on record for framing charges against the revisionist as well as there is no sufficient ground to discharge the accused-revisionist from the offences; that the narration of facts after array of parties regarding the revision being filed against the impugned order passed in Complaint Case No.1081-A of 2009, State Vs. Yaswant Chaturvedi, is absolutely wrong and misconceived; that the real fact is that F.I.R. was lodged by C.B.I. registering Case Crime No.09(E)/2006-EOU-VII, CBI in furtherance of the order dated 19.10.2006 of this Court in Company Petition No.125 of 1998, and upon thorough investigation and finding sufficient prima facie evidence of offences against the Company, its Promoters and Directors and Charted Accountant, charge sheet has been submitted against the accused persons; that it is wrong to say that the discharge application was submitted in a complaint case, rather the same was moved upon submission of charge sheet; that upon investigation it was found that the Company and its Promoters and Directors in conspiracy with Charted Accountant Biren R. Shah obtained funds to the tune of Rs.18.75 Crores from IDBI Bank, Mumbai for the purpose of setting up engineering machines manufacturing facility at Mathura in the State of U.P., but no such facility was ever set up and the heavy funds obtained on the basis of false/forged documents were siphoned off by the revisionist and his associates, the Directors/Promoters of Company in conspiracy with Charted Accountant of Company Biren R. Shah; that apart from various financial transactions, the request for crediting a sum of Rs.55 lacs and odd in current account of M/s Mathura Engineers and Constructions Private Ltd. was made under the signatures of revisionist; that sufficient prima facie evidence was collected during investigation showing commission of offence by revisionist and his Company Directors/Promoters, Charted Accountant etc. in misappropriating heavy funds in conspiracy with each other; that the revisionist and his associates neither utilized the funds obtained from Banks nor made repayment of loans taken for the purpose of setting up an Engineering Manufacturing Facility at Mathura; that the argument that CBI had no authority to submit charge sheet against the revisionist and other co-accused persons, as the scope of enquiry was limited, is absolutely wrong, incorrect and irrelevant which may not be considered in the revision against the rejection of discharge application, as the scope of revision is very limited and confined only to the illegality, if any and this Court cannot go beyond the scope of its revisional jurisdiction; that in any case when upon investigation, the Investigating Officer finds that any offence has been committed, he has to submit report in the form prescribed, to the Magistrate empowered to take cognizance; that in order dated 19.10.2006 by which investigation was handed over to the C.B.I., the Court did not direct the C.B.I. for submitting report before it and not before competent Magistrate; that the revisionist is very clever and influential person, who upon submission of charge sheet moved an application under section 482 Cr.P.C. No.26814 of 2009 for quashing of charge sheet and by obtaining an order for bail therein on 21.10.2009, without any order of liberty for moving discharge application, has misused the process of law by moving such application on one hand and on the other in delaying the disposal of his application under section 482 Cr.P.C. No.26814 of 2009 for quashing of charge sheet since last more than 8 years being afraid of its rejection.

Learned counsel for CBI has placed reliance on the judgment in the case of C.B.I. Vs. Maninder Singh, (2016) 1 SCC 389, in a matter, where respondent was charged with offence of cheating by using forged documents to embezzle the public money from bank and the High Court had quashed the proceedings under section 482 Cr.P.C., wherein the Apex Court setting aside the order of High Court, held that "such economic offences are public wrongs or crimes committed against society and gravity and magnitude thereof affect public at large - Courts must not be swayed by return of money to bank which has been defrauded but must also consider society at large - instant offence was well planned, and committed with deliberate design with an eye on personal profit regardless of consequence to society at large - cheating of bank exposits fiscal impurity and such financial fraud is an offence against society at large - to quash proceedings merely on ground of settlement with bank amounts to misplaced sympathy" and directed the trial court to proceed with the matter in accordance with law.

The rebuttal submission of learned counsel for the revisionist that since the law in above case has been laid in a matter based on F.I.R., it is not applicable to the present case of revisionist, which is based on an order passed by Company Judge, has no force, as in the present case proceedings are pending on submission of charge sheet and otherwise also.

Upon hearing the parties counsel and perusal of record, I find that the case laws relied by the learned counsel for the revisionist are based on totally different facts and are not applicable to the facts of this case. In cases of (i) Badrinath and (iv) Kalabharati Advertising (Supra), it has been observed that "Once the basis of a proceedings is gone, may it be at a later point of time by order of a superior authority, any intermediate action taken in the meantime - like recommendation of the State and of UPSC and the action taken thereon - would fall to the ground".

Referring to this observation, learned counsel for the revisionist has contended that since the prosecution in this case has been initiated in view of the interim order dated 19.10.2006 passed by this Court in a Company Petition and the revisionist has moved a review petition for recall of order dated 12.01.2006, so in case his review application is allowed, the prosecution case would fall to the ground and will have to go.

The above argument is hypothetical in nature. The possibility of disposal of recall / review application in future in favour of or against the revisionist my not be assessed and how highsover may be the chances of allowing of recall/review application, but in view of alleged strong chances or possibility, which may be likely in future, the revisionist may not be discharged of the offences regarding which sufficient prima facie evidence has been collected and upon submission of charge sheet cognizance has been taken. Otherwise also, the equal possibility of dismissal of recall/review application in future may also not be ruled out and no order can been passed on the basis of possibility of happening an event in future.

Relying on the case of (ii) Rukmini Narvekar (supra) by two Judges, learned counsel for the revisionist has referred that "in some very rare cases, the Court is justified in looking into the material produced by the defence at the time of framing of charges and if such material convincingly establishes that the whole prosecution version is totally absurd, preposterous or concocted and if accused are able to produce any reliable material, which might fatally affect the sustainability of the case, it is unjust to suggest that no such material should be looked into by the Court at that stage".

In this case, the revisionist has not produced any material whatsoever upon looking into which, the prosecution version may appear absurd, preposterous or concocted, or which may fatally affect the sustainability of the case and so in absence of any such material, the question of looking into the defence version does not arise. It is also pertinent to mention that in the case of State of Orrisa Vs. Debendra Nath Padhi (2005) 1 SCC 568, the three Judges Bench of the Apex Court has held that "at the stage of framing of charge, defence could only be heard, but could not be given an opportunity to produce evidence for the consideration of the court".

In the case of (iii) State of West Bengal and others Vs. Committee for Protection of Democratic Rights, West Bengal and others (supra), relied by revisionist, the Apex Court held that the extra ordinary power of referring the investigation of case to CBI must be exercised sparingly otherwise CBI would be flooded with large number of cases and with limited resources, which may find it difficult to properly investigate.

I do not find any force in this argument, which has been placed in reference with the impugned order dated 19.10.2016 by which the Company Judge directed the C.B.I. to register and investigate because the validity of above order (which has not been challenged before any Superior Court) may not be considered in this revision against the rejection of discharge application.

Relying on the case of (v) Omprakash J. Mehra (supra), learned counsel for the revisionist has submitted that since the revisionist has made repayment of entire loan (though he admits that some loan of IDBI is still outstanding) so there is no point in keeping the Company Petition pending, also has no force and on this score the impugned order of rejection of application for discharge, may not be considered illegal and may not be set aside.

In the case of (vi) Prashant Bharti (supra), the Apex Court has considered the scope of section 482 Cr.P.C. in relation to the quashing of proceedings upon submission of charge sheet under sections 328, 354, 376 IPC. Undisputedly, the scope of powers under section 482 Cr.P.C. is altogether different from the revisional powers of the Court, as the revisional court is required to look into the correctness, propriety, regularity and illegality, if any, in the impugned order, while the scope of section 482 Cr.P.C., is wide enough, rather unlimited and the Court may pass any order whatsoever to prevent the abuse of process of any Court or otherwise to secure the ends of justice, unlike in case of revision under section 397, 401 Cr.P.C.

It is noteworthy that according to charge sheet submitted by CBI on 22.12.2008 at S.A.1, Dinesh Chaturvedi, Manoj Kumar Singla, Yashwant Chaturvedi (the revisionist) and Ajay Bajaj, the Ex-Directors of M/s Vidiani Engineers Ltd. (VEL), with Biren R. Shah, C.A. indulged in large scale frauds since the very inception from 1995 onwards and obtained various loans/credit facilities from various banks/financial institutions and, thereafter, misappropriated the above funds. The above Directors obtained various loans/advances from various Banks/financial institutions and also obtained loan of Rs.500/- lacs, Rs.375/- lacs and Rs.500/- lacs through loan applications dated 25.4.1995, 16.6.1995 and 17.7.1995 under Equipment Finance Scheme and Rs.500/- lacs on 9.8.1995 for working capital under Corporate Scheme, for purchase of plant and machinery from different suppliers, by producing purchase orders (as quotations) from above companies/firms and without purchasing the machines, siphoned off the funds from the account of Company with the help of and in criminal conspiracy with co-accused B.R. Shah, the Charted Accountant, who issued various fake account certificates, certifying the utilization of various funds in purchase of machines from the loan released by IDBI. The charge sheet states that number of companies have disclosed the fact that though quotations were issued by them but subsequently, no supply orders were issued to them by VEL and hence they neither supplied any machinery/equipment to M/s VEL nor received any payments from it. The charge sheet also states to have revealed that the funds received from IDBI were transferred in accounts of various other firms of revisionist and his associates through cheques issued by revisionist and his associates, in order to misappropriate and usurp the same. It also states that M/s VEL obtained loans from certain other Banks/firms and did not repay because of which decrees for over Rs.3.58, Rs.3.74 and Rs.3.38 crores were obtained by Can Bank, Mashreq Bank and Federal Bank respectively from Debt Recovery Tribunal apart from which VEL did neither supply the agreed equipments to Premier International Ltd. and PIC UP nor refunded the money of Rs.200/- lacs obtained for procuring copper engraved printing rolls.

I do not find any force in the contention of the learned counsel for the revisionist with reference to the statement of T.K. Mukhopadyay, Chief General Manager, IDBI, Mumbai under section 161 Cr.P.C., who is alleged to have stated that the loan was disbursed in accordance with rules, upon required certificate of Charted Accountant, Istly because the Charted Accountant is alleged to have submitted false and incorrect account statements/certificates and utilization certificates, in criminal conspiracy with revisionist and other directors of M/s VEL, for obtaining above loans and IIndly because a Bank Manager or a person dealing with the matters, in official capacity, is duty bound to say that everything was done by him in accordance with rules and in any eventuality, he may not be expected to say/confess that he was in connivance with the accused in sanctioning or disbursing the loan on false certificates, in contravention of the rules.

It is also noteworthy that unlike the offences punishable under sections 376, 379, 302, 304, 395, 397 etc. of IPC, the offences punishable under sections 120-B, 420, 468, 471 and 409 IPC etc. are different in nature, and evidence in such cases is to be inferred from the bunch of facts and may not be expected to be as direct such as of an eye witness regarding the commission of offence or clear from the spot position and surrounding state of affairs which also speak about the offender of offence, as in the cases of murder, theft, rape dacoity etc. The CBI upon collecting the bulky evidence, has found a prima facie case of offences under sections 120-B, 420, 468, 471 and 409 IPC against VEL, the revisionist, his co-directors as well as their Charted Accountant, who were in connivance and criminal conspiracy with each other.

There is nothing on record to show that the revisionist or his associates were innocent persons having done no wrong or acted bonafidely. It is also noteworthy that on account of payment of any part of the dues by revisionist or his associates, during investigation, upon subsequent one time settlement or in execution of money decrees passed against M/s VEL and its Ex-Directors etc. by competent Court, the Debt Recovery Tribunal, the offence may not be undone. It is settled principle of law that at the time of framing of charges only prima facie evidence is to be considered and at that stage material on record is not required to be scrutinized so as to determine whether the accused would be convicted or not and if there is prima facie case, it is sufficient for framing of charges.

The evidence of offences against revisionist and co-accused persons collected by Investigating Officer and submitted with the charge sheet is prima facie sufficient and at the stage of framing of charges, the Court is not required to analyse the statements of witnesses recorded under section 161 Cr.P.C. or scrutinize other material filed on case diary and is not required to assess as to whether it would finally result in ultimate conviction or not. Only the statements of witnesses on oath, before the court during trial, comes within the category of evidence, which evidence is required to be analysed/scrutinized by the Court to convict or acquit an accused. The analyzation of prima facie evidence submitted with charge sheet with view of possibility of conviction of accused at the stage of framing of charges is totally unwarranted.

In the case of Sajjan Kumar Vs. CBI (2010) 9 SCC 368, the Apex Court has held that

"at the time of framing of charge under section 228 or considering discharge under section 227, it is not for Magistrate or Judge concerned to analyse all the materials including pros and cons, reliability of acceptability thereof etc.

It is at the trial, that Judge concerned has to appreciate evidenciary value, credibility or otherwise of material veracity of various documents and is free to take a decision one way or other.

Though P.Ws.1, 2, 8 & 10 did not whisper a word about involvement of appellant in anti Sikh riots of 1984 at the earliest point of time, yet it cannot be presumed that there is no case to proceed against appellant by trial Judge (23 years later) was either bad in law or abuse of process of law or without any material basis."

In the case of P. Vijayan Vs. State of Kerala AIR 2010 SC 663, the Apex Court has held that

"Judge is not a mere Post Office to frame the charge at the behest of prosecution - but has to exercise his judicial mind to facts of case in order to determine whether a case for trial has been made out by prosecution. Strong suspicion though may not take place of proof but is sufficient to frame charge and it is not open to court to say that there is no sufficient ground for proceeding against accused under section 227."

In the case of Ajai Kumar Parmar Vs. State of Rajasthan (2012) 12 SCC 406, the Apex Court has held that

"mandate of section 228 is that Judge only need be of, "Opinion that there is ground for presuming that the accused has committed an offence", before framing charge and "that appreciation of evidence at the stage of section 227 is not permissible"

In the case of State of Tamil Nadu Vs. Suresh Rajan (2014) 11 SCC 709, the Apex Court has held that

"Difference of language employed in different provisions of discharge under sections 227, 239 and 245 - notwithstanding differences in provisions relating to discharge in different sections and whichever provisions may be applicable, at this stage Court is only required to see if prima facie case is there to proceed against accused.

No mini trial is contemplated at the stage of considering discharge - court to proceed with assumption that materials brought on record by prosecution are true - only probative value of material has to be gone into to see if there is a prima facie case against accused.

Court is not expected to go deep into the matter and hold the materials would not warrant conviction - if court on basis of material thinks that accused prima facie might have committed offence, it can fame charge."

In view of discussions made above, I have come to the conclusion that learned Magistrate has not committed any error in passing the impugned order of rejection of discharge application of revisionist dated 26.7.2017. The learned counsel for the revisionist has failed to show any illegality, irregularity, impropriety or incorrectness in the impugned order and there is no sufficient ground for interfering with or for setting it aside the impugned order. The revision has got no force and is liable to be dismissed.

The revision is dismissed, accordingly.

Interim order, if any, stands vacated.

Let a copy of this order be sent to court below for ascertaining expeditious disposal of the case in accordance with law.

Order Date :- 20.11.2017

Tamang