Bombay High Court
Bapurao Trimbakrao Sonawane vs The State Of Maharashtra on 10 February, 2009
Bench: S. S. Shinde
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD.
CRIMINAL APPLICATION NO.3970 OF 2008
Bapurao Trimbakrao Sonawane,
Age 57 yrs., Occu. Service,
R/o. Behind New Motoshri Hospital,
Laxmi Nagar, Chalisgaon,
Dist. Jalgaon.
..Applicant.
VERSUS
1. The State of Maharashtra
2. The Superintendent of Police,
Jalgaon.
..Respondents.
Shri.R.N.Dhorde, Advocate h/f. Shri.A.V.Deshpande,
Advocate for applicant.
Shri.N.H.Borade, A.P.P. assisted by Shri.P.P.Chavan,
Advocate for respondent Nos.1 & 2.
CORAM : S.S.SHINDE, J.
DATED : 10th FEBRUARY, 2009.
JUDGMENT
. Rule. Heard forthwith.
2. This application is filed for anticipatory
bail in connection with Crime No. 216/2008 registered
with Chalisgaon Police Station for the offences
punishable under sections 406, 408, 409, 420, 465,
468, 471, 120-B, 201, r/w. 34 of Indian Penal Code.
( 2 )
3. The said crime is registered on 19.10.2008 at
Chalisgaon Police Station. This application is filed
before this Court on 22nd November, 2008. The
application filed for anticipatory bail of the present
applicant on 23.10.2008 before the Sessions Court came
to be rejected on 15.11.2008. Hence, this
application.
4. The facts as narrated in the application are
as follows.
. The
applicant is Ex-Director of Chalisgaon
Peoples Co-operative Bank Ltd. He had performed his
duties as permissible in law and had not recommended
proposals of any relatives. It is further case of the
applicant that he has not taken disadvantage of his
position and there are no any outstanding dues towards
the applicant. The applicant was elected Director
from 21st August, 1997 to 30.12.2003. It is further
case of the applicant that from 1999 the applicant
underwent C.A.B.G. (by-pass) surgery, therefore, the
applicant was not present on various meetings of the
Bank.
5. It is further case of the applicant that the
( 3 )
Special Auditor Co-operative Societies Class II,
served notice to the applicant under section 81(1)(3A)
of the Maharashtra Co-operative Societies Act, 1960
dated 9.9.2008. It was alleged in the said notice
that the applicant has misappropriated the amount of
the Bank and cheated the Bank when applicant was
elected as Director. It is alleged that the applicant
has not followed the Rules and Regulations laid down
by R.B.I. from time to time. On 16.9.2008 the
applicant applied for supply of certain documents from
the
this
Bank.
On refusal, he filed writ petition
Court and this Court directed the respondent No.
before
3 in that writ petition to make available all the
documents to the applicant and said writ petition was
disposed of. It is further case of the applicant that
in spite of direction in writ petition, no documents
were supplied to the applicant and some documents were
given by the Bank.
6. It is further case of the applicant that
meanwhile on 23.10.2008 the applicant preferred
Criminal Bail Application No. 1045/2008 under section
438 of Criminal Procedure Code before the learned
Additional Sessions Judge, Jalgaon and same came to be
rejected on 15.11.2008. It is the case of the
( 4 )
applicant that during the pendency of the bail
application before the Sessions Court detail reply was
filed on 23.10.2008 to the show cause notice dated
9.9.2008.
7. It is further case of the applicant that the
Additional Sessions Judge, who rejected the
anticipatory bail of the applicant, had granted the
anticipatory bail and regular bail to other co-accused
persons in the same crime. The details are given in
para
Madhukar
27 of
the application. It
Ukha Choudhari, Shekhar Kanhiylal Bajaj
is stated that
and
Suresh Ramchandra Swar, who were Directors of the
Bank, have been granted anticipatory bail on
1.11.2008. It is further stated that Joyti Dilip
Rakha, Shivaji Devsing Rajput, Devidas Pandit More,
Sandhya Naresh Deshmukh and Ramesh Vithal Shirude, who
were Directors, have been granted anticipatory bail.
It is further stated that the borrowers namely Ramdas
Choudhari, Mangala Ghaged, Sanjay Choudhari, Sandeep
Sharama, Vinod Sharama, Avinash Shirude, Pradeep
Somnath Kalantri, Ajit Ghate, Ashok Kalantri have been
granted either anticipatory or regular bail.
8. It is further case of the applicant that the
( 5 )
borrowers who have borrowed the money from the Bank
have repaid their loan amount. The applicant in para
28 disclosed the chart of the persons/borrowers by
whom loan amount is repaid to the Bank.
9. The application discloses various grounds on
which applicant seeks anticipatory bail. The grounds
are narrated in para 30 of the application.
10. The application is taken for final hearing.
The
submits
learned
counsel appearing for
that the present applicant though Ex-Director
the applicant
during his period as Director, has not borrowed any
loan or his relatives have not borrowed any loan from
the Bank. He further submits that the Sessions Court
has released Directors as well as borrowers on
anticipatory bail. He also invited my attention to
the contents of the application and submitted that
details are given in respect of the Directors and
borrowers to whom bail is granted by the Sessions
Court. He further submitted that the applicant is
entitled for anticipatory bail on the ground of
parity. He further invited my attention to the fact
that though relatives of some of the Directors have
taken loan, they are released on anticipatory bail by
( 6 )
the Sessions Court. However, the present applicant
though not borrowed any loan or by his relatives, has
been refused anticipatory bail by the Sessions Court.
He further submits that the entire record is in the
custody of the Bank. No purpose would be served by
keeping the applicant behind the bar. The applicant
is ready to co-operate with the investigating
machinery and he will attend the concerned police as
and when directed by the Investigating Officer. He
further submits that even the applicant is ready to
attend
submits
the
that
police
the
station every
applicant was in
day. He
minority.
further
The
decisions taken by the Members of the Board are the
views of the majority Directors. According to the
applicant, he along with other few Directors were in
minority and therefore, whatever the resolutions have
been passed, granting illegal disbursement of loan, is
responsibility of those Directors who are in majority.
He further submitted that since the applicant had
undergone by-pass surgery, if he is not released on
bail, he may have serious health problems. Therefore,
he prayed that the applicant should be released on
bail. He further submitted that while entertaining
this application all the grounds which are taken in
application in para 30 may be taken in to
( 7 )
consideration.
11. The learned A.P.P. assisted by the advocate
for the Bank submitted that the Special Auditor Class
II Co-operative, Chalisgaon, set the criminal law in
motion by submitting criminal complaint in Chalisgaon
Police Station, which came to be registered on
19.10.2008 as Crime No. 216/2008. The total detected
fraud is of Rs. 5,51,23,000/- with interest.
12.
The
F.I.R.
learned A.P.P. submitted that there
came to be registered under sections
are
406,
408, 409, 420, 465, 468, 471, 120-B r/w. 34 of the
Indian Penal Code. According to the learned A.P.P.,
the total fraud detected is of Rs.20,78,56,325/-. The
various crimes are registered i.e. Crime Nos.
216/2008, 248/2008 to 259/2008.
13. It is further submitted by the learned A.P.P.
that the Special Auditor Class II found the
illegalities, misappropriation, siphoned of money of
the bank, violation of rules and regulations of the
Maharashtra Co-operative Societies Act, 1960, Banking
Regulation Act, 1949 and the notification issued by
the R.B.I. from time to time as well as violation of
( 8 )
exposure limit of loan and also found the bogus loan
cases and disbursement of amount under the garb of
loan.
14. According to the learned A.P.P., the arrest is
part of process of investigation intended to secure
several purposes. The accused may have to be
questioned in detail regarding various facets of
motive, preparation, commission and aftermath of the
crime and the connection of other persons, if any, in
the
in
crime.
There are possibilities and circumstances
which the accused may provide information leading
to discovery of material facts.
15. The learned A.P.P. submitted following points
for rejection of bail.
a. There is sufficient material to indicate that
financial irregularities, dishonest and fraudulent
loan transactions have been taken place in the affairs
of the said bank, for which the Board of Directors and
certain borrowers, who were in collusion with them are
responsible.
b. According to the learned A.P.P., the present
( 9 )
applicant was Director of the said bank from 23.8.1997
to 22.2.2004 The involvement of the applicant in the
alleged offence is clearly made out.
c. According to the learned A.P.P., the ground of
parity does not exist, the other persons are released
on bail whose cases are of not that serious nature
like present applicant. Considering the nature and
gravity of the offence, the applicant is not entitled
to be released on anticipatory bail.
d. There
is documentary evidence against the
applicant. The overtacts of applicant and others is
manifest. The crime in which the applicant is
involved, is very serious and involving conspiracy to
cheat and defraud public institution in a systematic
manner.
e. In the present crime, involving public
mischief resulting into serious offences involving
huge illegal finance, committed against the bank at
large, in this event it may be keep in view the
potential threat, which may cause huge financial set
back to gullible public i.e. depositors.
( 10 )
f. There was designed plan, prima facie to
defraud the depositors and members of the bank. The
bank is put to loss of approximately 20 crore due to
finical bungling, manipulations and money laundering.
The applicant joined hands with other Directors,
intentionally, knowingly and deliberately defrauded
the bank.
g. The Chairman, members of Board of Directors,
Manager in furtherance of their common intention
committed
unlawfully
breach
ig of trust and they have involved
disbursement of amount in crore to their
in
relatives under the garb of loan. The said so-called
loan was not refunded from the borrowers. The loan
was given for the purpose of business to the close
relatives of some of the Directors or Ex-Directors or
Manager. In fact the business for which the loans are
given were never in existence. The loan is disbursed
by passing the provisions of Co-operative Law, by-laws
and Rules and Regulation to their close relatives,
well wishers illegally without obtaining security and
mortgage or proper security from the borrowers. At
the time of obtaining and sanctioning loan forged
documents were prepared and on that basis the loans
were granted by the Board of Directors.
( 11 )
h. During the course of investigation,
prima-facie it appears that there is systematic fraud
committed due to which the bank has caused great loss.
i. As per the master circular dated 4th July,
2007, in point No. 6.2 - the wilful default is
defined and in point No. 6.3 - diversion and
siphoning of funds elaborately narrated. The penal
measures are also narrated in 6.6(b) and in point No.
6.9 - a
criminal
against the borrower by the R.B.I.
action is directed to be
In the circular in
taken
point No. 4.6.3 oral sanction is prohibited.
j. It is further submitted by the learned A.P.P.
that the total number of directors till 1998 were 13,
till 21.2.2004 the number of directors were 15 and
thereafter, 17 directors were there. The Board of
Directors was dissolved by the learned D.D.R. on
6.9.2006 as there were illegality. There was 6
committees constituted by the Board of Directors. In
each committee near about 5 directors were nominated.
Amongst the directors in the 6 committees, each of the
Directors were given representation. All Directors
were represented in two or three committees. The
( 12 )
committees were constituted as valuation committee,
supervision committee, scrutiny committee, guarantor
committee, loan sub committee, godown committee. In
the said committees, all the Directors were nominated.
After the report of all committees the loan case has
to be put up before the Board of Directors for
sanctioning the loan. The Directors, who were
represented in the above committees, were again sit as
a Board of Directors to sanction the loan. It means
each of the Director were acted in duel capacity. All
these
disclosed
registers
in
the
are seized by the I.O.
investigation that
It
though
is also
these
committees were there, in fact, they have not
performed their duties. No loan officer was
appointed. Managing Director was also not appointed.
All the work to scrutinize, to value the property, to
verify the goods etc. was with the Board of
Directors.
k. It is further submitted that the earlier
auditors have time and again objected and pointed out
the bogus loan cases, however, the Board of Directors
were in power till 6.9.2006, therefore, they have not
filed any criminal case because they could have become
accused and that criminal case could be filed against
( 13 )
themselves and therefore, knowing and deliberately
they avoided and ignored the audit report. The
present applicant was also in supervision committee,
guarantor committee, godown committee and valuation
committee.
l. It is further submitted by learned A.P.P.
that as per the resolution dated 13.7.2001 though
again the loan sub committee, audit and inspection
committee, staff sub committee, recovery sub committee
were
never
reconstituted,
ig however, those committees
come in existence, those committees were remain
were
on paper only.
m. It is further submitted that there is no
possibility to recover the huge amount and therefore,
there is every possibility that applicant is likely to
abscond and will tamper with the prosecution evidence
and witnesses and hence, bail may be rejected.
16. I have given anxious consideration to the
rival submissions. Since the present application is
filed for seeking anticipatory bail, it may not be in
the interest of either side to comment on the merits
in detail of the matter since investigation is in
( 14 )
progress. Therefore, I proceed to decide this
application, mentioning relevant facts confined to
prayer in this application.
17. At this juncture, it would be relevant to
refer to the observations of the Apex Court while
dealing with the applications for anticipatory bail
and scope of section 438 of Cr.P.C. Section 438 of
Cr.P.C. makes special provision for granting
"anticipatory bail" which was introduced in the
present
Vs. State
Code
ig of 1973.
of M.P.,
As observed in Balchand
(1976) 4 S.C.C.
Jain
572,
"anticipatory bail" means a bail in anticipation of
arrest. The expression "anticipatory bail" is
misnomer inasmuch as it is not as if bail presently
granted in anticipation of arrest. Where a competent
Court grants "anticipatory bail", it makes an order
that in the event of arrest, a person shall be
released on bail. There is no question of release on
bail unless a person is arrested and, therefore, it is
only on arrest that the order granting anticipatory
bail becomes operative.
. It is also observed in the said judgment that
the the power of granting "anticipatory bail" is
( 15 )
extraordinary in character and only in exceptional
cases where it appears that a person is falsely
implicated or a frivolous case is launched against him
or "there are reasonable grounds for holding that a
persons accused of an offence is not likely to
abscond, or otherwise misuse his liberty while on
bail", that such power may be exercised. Thus, the
power is "unusual in nature" and is entrusted only to
the higher echelons of judicial service i.e. a Court
of Sessions and a High Court.
18. The
Apex Court in the case of Gurbaksh Singh
Sibba V. State of Punjab reported in (1980) 2 S.C.C.
565 has made observations regarding scope of section
438 of Cr.P.C. The Supreme Court has observed in para
26 that section 438 is a procedural provision which is
concerned with the personal liberty of the individual,
who is entitled to the benefit of the presumption of
innocence since he is not, on the date of his
application for anticipatory bail, convicted of the
offence in respect of which he seeks bail. It is
further observed in the same paragraph that since
denial of bail amounts to deprivation of personal
liberty, the court should lean against the imposition
of unnecessary restrictions on the scope of Section
( 16 )
438 , especially when not imposed by the legislature.
In para 31, it is further observed that in regard to
anticipatory bail, if the proposed accusation appears
to stem not from motives of furthering the ends of
justice, but from some ulterior motive, the object
being to injure and humiliate the applicant by having
him arrested, a direction for the release of the
applicant on bail in the event of his arrest would
generally be made. On the other hand, if it appears
likely, considering the antecedents of the applicant,
that
bail,
taking
advantage of the orders of
he will flee from justice, such an order
anticipatory
would
not be made. But, the converse of these propositions
is not necessarily true. In fact, there are numerous
considerations, the combined effect of which must
weigh with the court while granting or rejecting
anticipatory bail. The nature and seriousness of the
proposed charges, the context of the events likely to
lead to the making of the charges, a reasonable
possibility of the applicant's presence not being
secured at the trial, a reasonable apprehension that
witnesses will be tampered with and "the larger
interests of the public or the State" are some of the
considerations which the court has to keep in mind
while deciding an application for anticipatory bail.
( 17 )
. In para 40 and 41 the Apex Court has further
observed that a blanket order i.e. an order which
serves as a blanket to cover or to protect any and
every kind of allegedly unlawful activity, in fact any
eventuality, likely or unlikely regarding which, no
concrete information can possibly be had, should not
generally be passed. Such a blanket order is bound to
cause serious interference with the functions of the
police.
. It
is further observed in para 36 that if an
application for anticipatory bail is made to the High
Court or the Court of Session, it must apply its own
mind to the question and decide whether a case has
been made out for granting such relief. It cannot
leave the question for the decision of the Magistrate
concerned under Section 437 of the Code, as and when
an occasion arises. It is further observed in para
27, 38 and 39 that the filing of an F.I.R. is not a
condition precedent to the exercise of the power under
section 438. Anticipatory bail can be granted even
after an F.I.R. is filed, so long as the applicant
has not been arrested. But the provisions of section
438 cannot be invoked after the arrest of the accused.
( 18 )
It is further observed in para 42 that an order of
bail can be passed under Section 438(1) without notice
to the Public Prosecutor. But notice should issue to
the Public Prosecutor or the Government Advocate
forthwith and the question of bail should be
re-examined in the light of the respective contentions
of the parties. The ad-interim order too must conform
to the requirements of the section and suitable
conditions should be imposed on the applicant even at
that stage.
19. In case
ig of State represented by the C.B.I.
Vs. Anil Sharama, (1997) 7 Supreme Court Cases 187,
the Supreme Court in para 6 has observed thus :-
Custodial interrogation is qualitatively more
elicitation-oriented than questioning a
suspect who is well ensconced with a
favourable order under Section 438 of the
Code. In case like this effective
interrogation of a suspected person is of
tremendous advantage in disintering many
useful information and also materials which
would have been cancelled. Success in such
interrogation would elude if the suspected
( 19 )
person knows that he is well protected and
insulated by a pre-arrest bail order during
the time he is interrogated. Very often
interrogation in such a condition would reduce
to a mere ritual. The argument that the
custodial interrogation is fraught with the
danger of the person being subjected to third
decree methods need not be countenanced, for,
such an argument can be advanced by all
accused in all criminal cases. The Court has
to
would
presume
conduct
that responsible police
themselves in a
officers
responsible
manner and that those entrusted with the task
of disintering offences would not conduct
themselves as offenders.
20. The Supreme Court in the case of Narinderjit
Singh Sahni and another V. Union of India and others,
reported in A.I.R. 2001 Supreme Court 3810 has
observed that if accused facing a charge under
sections 406, 409, 420 and 120-B is ordinarily not
entitled to invoke the provisions of section 438 of
the Criminal Procedure Code unless it is established
that such criminal accusation is not a bona fide one.
( 20 )
21. In the case of Ram Narain Poply Vs. Central
Bureau of Investigation with Pramod Kumar Monocha Vs.
Central Bureau of Investigation with Vinayak Narayan
Deosthali, reported in A.I.R. 2003 Supreme Court 2748
in para 382 the Supreme Court has observed thus :-
382. The cause of the community deserves
better treatment at the hands of the Court in
the discharge of its judicial functions. The
Community or the State is not a persona non
granta
disdain.
ig whose cause may be
The entire community is aggrieved if
treated with
economic offenders who ruin the economy of the
State are not brought to book. A murder may
be committed in the heat of moment upon
passions being aroused. An economic offences
is committed with cool calculation and
deliberate design with an eye on personal
profit regardless of the consequence to the
Community. A disregard for the interest of
the community can be manifested only at the
cost of forfeiting the trust and faith of the
community in the system to administer justice
in an even handed manner without fear of
criticism from the quarters which view white
( 21 )
collar crimes with a permissive eye unmindful
of the damage done to the national Economy and
National Interest, as was aptly stated in
State of Gujrat V. Mahanlal Jitamalji Porwal
and another, (A.I.R. 1987 1321).
22. While considering the scope of anticipatory
bail under section 438 of Criminal Procedure Code in
case of Adri Dharan Das V. State of West Bengal
reported in 2005 A.I.R. S.C.W. 1013, relying on the
earlier
Balachand
Constitutional
Jain V.
Bench judgment
State of Madhya Prades reported in
in case of
A.I.R. 1977 S.C. 366, the Supreme Court in para 7
has observed thus :-
The power exercisable under Section 438 is
somewhat extraordinary in character and it is
only in exceptional cases where it appears
that the person may be falsely implicated or
where there are resonable grounds for holding
that a person accused of an offence is not
likely to otherwise misuse his liberty then
power is to be exercised under Section 438.
The power being of important nature it is
entrusted only to the higher echelons of
( 22 )
judicial forums i.e. the Court of Session or
the High Court. It is the power exercisable
in case of an anticipated accusation of
non-bailable offence. The object which is
sought to be achieved by Section 438 of the
Code is that the moment a person is arrested
if he has already obtained an order from the
Court of Session or High Court, he shall be
released immediately on bail without being
sent to jail.
23. The
Supreme Court in the case of Himanshu
Chandravadan Desai & ors. Vs. State of Gujrat
reported in 2006 Cri.L.J. 136 while considering bail
application of the applicants therein has observed
thus :-
Accused a Director of Bank and others involved
in Bank Scam - Siphoned off funds of Bank
worth crores by bogus loans and fictitious
letters of credit in name of their friends,
relatives etc. - Offence is very serious -
Evidence showing their prima facie involvement
in offence - Having regard to huge amounts
involved there is danger of accused
( 23 )
absconding, if released on bail, or attempting
to tamper with evidence by pressurizing
witnesses - Refusal of bail is proper.
24. This Court in the case of State of Maharashtra
V. Pramod Sahebrao Rohankar, reported in 2008 ALL
M.R. (Cri.) 3476 has cancelled the anticipatory bail
granted to the applicants therein with observations in
para 12 that :-
12.
case,
ig In the fact situation of the
there is sufficient material
present
available
to infer that the Directors joined hands with
Chairman Rajendra Wani while sanctioning the
loan cases on a single day, in the four lots
mentioned above, which resulted into huge
financial loss to the Co-operative Credit
Society. Nobody made any attempt to verify
whether the borrowers were eligible, whether
the proper procedure was followed, whether the
sufficient securities were obtained and
whether such huge loans were likely to be
recovered. Since some of the borrowers are
not in existence at all and no security is
obtained from many of them, it is obvious that
( 24 )
recovery of the loans under the Maharashtra
Co-operative Societies Act would be difficult.
The learned Additional Sessions judge failed
to consider these aspects of the matter. He
did not record sufficient reasons and vaguely
observed that the respondents were not
directly involved in the financial misdeeds.
Needless to say, the impugned orders are
illegal, perverse and liable to be quashed.
25. In
observations
the
ig light of above cited
made therein by the Apex Court and
judgments and
this
Court, I proceed to decide the present application for
anticipatory bail.
. The Supreme Court in Gurubaksh Singh Sibba
cited Supra has observed that,"the larger interests of
the public or the State" should be one of the
consideration while granting bail. The case in hand
requires to be considered from the said angle.
26. The present applicant was the Director of the
Bank for the period from 23.8.1997 to 22.2.2004.
During the period in which the present applicant was
Director, he attended several meetings and in the said
( 25 )
meetings resolutions were passed to grant loans to
various persons. According to the complainant, as
disclosed in the said resolutions, taking decision to
grant loan to various persons was in contravention
with Bank Regulation, R.B.I. Regulation, By-laws of
the concerned Bank, the provisions of Maharashtra
State Co-operative Societies Act and other relevant
regulations issued from time to time by the
Government.
27.
his
In
the instant case, though the applicant
relatives have not taken loan, however, the
or
loan
is sanctioned to 20 borrowers during the period in
which the present applicant was Director. The
following persons are the borrowers who have taken the
loan during the period in which the present applicant
was Director.
------------------------------------------------------
Sr.No. Name of the borrower Amount of loan
------------------------------------------------------
1. Avinash Dhondu Shirode Rs.9 lakhs
2. Uma Agencies Rs.10 lakhs
3. Ramchandra Balkrushna Morankar Rs.5 lakhs
4. Ramdas Tanaji Choudhari Rs.20 lakhs
( 26 )
5. Pooja Land Developers Rs.25 lakhs
6. Nandkishor Urwa Choudhari Rs.5 lakhs
7. Swar Hotel Private Ltd. Rs.50 lakhs
8. Hotel Kanishka Rs.15 lakhs
9. Madhukar Ramchandra Swar Rs.10 lakhs
10. Vimal Vishwanath Swar Rs.2,85,000/-
11. Vishwanath Ramchandra Swar Rs.10 lakhs
12. Ajit Vidyasagar Ghate Rs.3,40,000/-
13. Badrinaraya Balmukund Somani Rs.26 lakhs
14. Kishor Badrinarayan Somani Rs.10 lakhs
15.
16.
Sidhappa Yamaji Gavali
Rajendra Sidhappa Gavali
Rs.1,70,000/-
Rs.95,000/-
17. Rajendra Sidhappa Gavali Rs.5,000/-
18. Babi Tukaram Gavali Rs.10 lakhs
19. Vaishali Pramod Gavali Rs.3,99,000/-
20. Mangala Anil Chajed Rs.50 lakhs
------------------------------------------------------
28. It is pertinent to mention that loan proposals
are sanctioned either to the relatives of the
Directors or to other borrowers. The loans are
sanctioned without security or mortgage. There is
violation of prescribed limit of granting loan and
loan proposals are sanctioned beyond the prescribed
limit. The loans are sanctioned for business purpose,
( 27 )
however, there is no proof in the file or record of
the bank that the borrowers who have borrowed the loan
for business, are carrying same business. The loan
amount is either used for the benefit of the Directors
or relatives or the borrowers. There is violation of
by-laws of the Society and loan proposals are
sanctioned in utter disregard of the by-laws of the
Society. The applicant had attended number of
meetings in which decisions were taken to grant the
loan contrary to the by-laws of the Bank, R.B.I.
guidelines and Rules and Regulations.
29. Though the applicant has not borrowed the loan
for himself or for his relatives, still the applicant
cannot escape from his responsibility/ liability for
huge loss sustained to the bank due to non payment of
loan amounts by the borrowers. The present applicant
has not opposed any of the bogus loan cases during the
meetings in which he attended and signed the
proceedings. The other two Directors namely
Durgaprasad Kaluram Daima and one other Director have
consistently opposed sanctioning of loan proposals
contrary to the by-laws of the Bank or guidelines of
the R.B.I. The present applicant should have opposed
such proposals during the meetings, if he was really
( 28 )
innocent. Not only that the applicant has attended
the number of meetings and signed the proceedings of
the meetings. The argument of the learned A.P.P.
that the present applicant is vicariously liable for
all the bogus loans, sanctioned during his period, has
considerable substance and said the contention cannot
be rejected at outright. If the arguments of the
learned A.P.P. are carefully perused, various
instances have been cited by the A.P.P. to show that
how the loans are advanced illegally to the persons
contrary
provisions
to
the Rules and Regulations
of Maharashtra Co-operative Societies
of R.B.I.,
Act
and Rules thereunder and relevant directions issued by
the Government from time to time.
30. It would not be out of place to refer the
arguments of the learned A.P.P. that the larger
amount of the bank have been systematically syphoned
of, there is misappropriation to the tune of Rs.27
crores. The Bank is put to loss by hatching
systematic plan/conspiracy by the Directors and
borrowers and as a result, the thousands of depositors
who have put more than 37 crores in the Bank, are not
getting their deposits back due to non recovery of
amount of Rs. 27 crores loan disbursed by the Bank.
( 29 )
31. The present applicant had attended number of
meetings and signed the proceedings on those days on
which loan proposals of as many as 20 persons have
been sanctioned. Nothing prevented the present
applicant from opposing the said resolutions which
were being passed contrary to the by-laws of the Bank.
Afterall unless the Director Board approves the
proposals in their meeting, no further steps can be
taken by the Bank. The main decision of sanctioning
the
Director
loan
proposals is by way of resolutions
Board in their meetings. Merely because the
by the
applicant has not borrowed the loan himself or his
relatives, prima facie, it cannot be concluded that he
is not responsible for the illegal disbursement of the
loan amount contrary to the policy of the Bank. The
total amount outstanding towards the borrowers is more
than Rs.27 crores. Thousands of depositors have
deposited their hard earned money in the bank. The
deposits, according to the figures given by the
learned A.P.P., is more than 37 crores rupees and bank
is not able to return the amount of depositors due to
the fact that more than 27 crores loan amount to be
recovered from the Directors, their relatives and
other borrowers.
( 30 )
32. Since the application is only for the
anticipatory bail though various contentions are
raised by the applicant and the learned A.P.P. , it
would not be appropriate to comment in detail about
the merits of the case since the investigation is in
progress. Suffice it to say that if the contents of
the F.I.R. are perused carefully, prima facie
conclusion can be drawn that there was systematic plan
hatched by the Directors to grant loan amounts
illegally
relatives
to
ig various borrowers
of the Directors or the Directors have some
who are either
interest shared with them, causing heavy loss to the
Bank and depositors of the Bank.
33. The contents of the complaint are not only
limited to the fact that whether the Director himself
or his relatives have taken loan, but the allegations
refers to the disbursement of huge amount towards loan
contrary to the by-laws of the bank, guidelines of the
R.B.I. and other relative provisions of Maharshtra
State Co-operative Societies Act and Rules thereunder.
Prima facie it can be said that Directors Board was
responsible for sanctioning the loan proposals
contrary to the policy of the bank and they cannot
( 31 )
escape from their responsibility merely on the ground
that the particular director or his relatives have not
taken loan. The persons who were Directors during the
period in which loan proposals are sanctioned in the
meetings contrary to the policy of the bank are
collectively responsible and no Director can escape
from the responsibility, unless he or she demonstrates
that the loan proposals were opposed by them in the
meetings and they protested against the sanction of
the loan proposals contrary to the policy of the Bank.
34. The
applicant though claims that he was in
minority group, nothing has been placed on record to
show that the majority Directors have taken decision
and the present applicant was in minority. The
present applicant participated in meetings and signed
the proceedings and did not protest against the
decisions taken by the Directors Board granting huge
amount of loan to various borrowers, some of the
Directors and their relatives.
35. The applicant is a signatory to the various
resolutions passed from time to time during the period
in which he was Director. It can not be forgotten
that thousands of depositors have deposited more than
( 32 )
Rs.37 crore in the said Bank and total loan on the
date of filing the complaint was to be recovered from
the borrowers to the extent of around Rs.28 Crores.
If the contents of the complaint and other documents
which are made available, are perused carefully, same
would demonstrate that loans have been sanctioned by
the Board in utter disregard to the by-laws of the
Bank, inasmuch as the loans have been granted. The
loans have been sanctioned in excess of permissible
limit under the by-laws. It can also be seen that the
security.
loans have been sanctioned without obtaining requisite
It could also be seen from the record that
loans have been sanctioned to close relatives of the
some of the Directors It could be seen that there is
prima facie evidence of involvement of the present
applicant in granting loans in huge amounts to various
persons including some Directors and relatives of some
Directors. Though the applicant or his relatives have
not borrowed the loan, he could not escape from his
liability as a signatory of the various loan proposals
during his period when he was Director and therefore,
the applicant does not deserve the leniency.
36. In my considered view, if the judgments of the
Apex Court and this Court referred hereinabove are
( 33 )
considered in the light of fact and situation of this
case, the application for anticipatory bail deserves
to be rejected.
37. In the present case, thousands of depositors
are deprived from their hard earned money since the
bank is not able to repay there deposits to them. The
bank has been duped by the Directors, their relatives
and borrowers without having any regard to the
security of the bank or interest of the bank. The
applicant was
igDirector for considerable period.
case protection is granted to the applicant, there may
In
be possibility that he may try to influence the
prosecution witnesses.
38. Though the learned cousel for the applicant's
argument that some of the Directors and borrowers have
been released on bail and therefore, the present
applicant may be released on bail on the ground of
parity, deserves to be rejected. While granting bail
each case may be considered on its own facts. The
other two Directors to whom bail is granted by this
Court, their case stands on different footings. In
those cases the learned counsel appearing for them has
demonstrated on the basis of the documents produced on
( 34 )
record that they consistently opposed the resolutions
in which decisions were taken to grant loan contrary
to policy of the Bank. The present applicant has not
opposed any loan proposal during the meeting in which
he was present and signed the proceedings.
39. In the present case the F.I.R. is lodged on
19.10.2008. The application for anticipatory bail was
filed by the present applicant before the Sessions
Court on 23.10.2008. Now the investigation has
progressed at certain level and it may be possible for
regular Court to consider application of the applicant
for regular bail and concerned Court can consider his
regular bail application on the strength of the
documents and evidence collected by the Investigating
agency.
40. For all these reasons stated hereinabove, the
application for anticipatory bail is rejected. Rule
is discharged.
. It is made clear that observations made here
in above are restricted only for the purpose of
deciding the present application.
( 35 )
[ S.S.SHINDE, J.]
ssc/criapln3970.08
