Karnataka High Court
Smt.Mallamma vs State By Inspector Of Police on 7 December, 2023
Author: K. Natarajan
Bench: K. Natarajan
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 7TH DAY OF DECEMBER, 2023
BEFORE
THE HON'BLE MR. JUSTICE K. NATARAJAN
CRIMINAL APPEAL NO.792 OF 2011
CONNECTED WITH
CRIMINAL APPEAL NOS.780 OF 2011, 812 OF 2011, 813 OF
2011, 814 OF 2011, 815 OF 2011 AND 967 OF 2011
IN CRIMINAL APPEAL NO.792 OF 2011
BETWEEN:
SRI. SRIKANTH KULKARNI
S/O. BHIMRAO KULKARNI
R/AT.VASTRADA GALLI
M S WARAD BUILDING,
SINDHAGI BIJAPUR TALUK
BIJAPUR DISTRICT
... APPELLANT
(BY SRI. R. NAGENDRA NAIK, ADVOCATE)
AND:
STATE BY INSPECTOR
OF POLICE, CBI ACB
BANGALORE
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
2
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C PRAYING THAT THIS HON'BLE COURT MAY
BE PLEASED TO SET ASIDE THE ORDER OF CONVICTION
AND SENTENCE DATED 05.07.2011 PASSED BY THE XXXII
ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR CBI
CASES, BANGALORE IN SPL.C.C.NO.09/2008 - CONVICTING
THE APPELLANT/ACCUSED FOR THE OFFENCES PUNISHABLE
UNDER SECTIONS 120(b) READ WITH SECTIONS 468, 471,
477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.780 OF 2011
BETWEEN:
R. SHIVAKUMAR
S/O. N. RAMASUBRAMANIAN,
AGE: 55 YEARS, OCC: MANAGER, UCO BANK,
INDIRANAGAR BRANCH,
BANGALORE .
R/O. NO.17/1, MUDDAPPA ROAD,
MARUTHI SEVA NAGAR,
BANGALORE.
... APPELLANT
(BY SRI. S. P. KULKARNI, SENIOR ADVOCATE FOR
JANKI RAMAN, ADVOCATE)
AND:
THE STATE OF KARNATAKA
REPRESENTED BY INSPECTOR OF POLICE,
C.B.I/ACB,
BANGALORE - 560 001.
... RESPONDENT
(BY SRI. P.PRASANNA KUMAR, SPECIAL COUNSEL)
3
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.5 FOR THE
OFFENCES PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.812 OF 2011
BETWEEN:
SMT. MALLAMMA
W/O LATE B. S. RAJASHEKARAIAH,
R/AT H NO.1488/27, 1 "A" CROSS,
SIDDAVEERAPPA EXTENSION,
DAVANAGERE.
... APPELLANT
(BY SRI. R. NAGENDRA NAIK, AMICUS CURIAE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY
STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
4
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C. PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.5 FOR
OFFENCE PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.813 OF 2011
BETWEEN:
SIDDAVEERAIAH
S/O SIDDALINGASWAMY.G,
R/AT H NO.1488/27, 1ST "A" CROSS,
SIDDAVEERAPPA EXTENSION,
DAVANAGERE.
... APPELLANT
(BY SRI. MOHAMMED MUJASSIM, ADVOCATE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P PRASANNA KUMAR, SPECIAL COUNSEL)
5
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) CR.P.C PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.2 FOR THE
OFFENCE PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.814 OF 2011
BETWEEN:
SIDDALINGASWAMY K. V.
S/O VEERAIAH,
R/AT BANNIKODU VILLAGE,
HONNALI TALUK,
DAVANAGERE.
... APPELLANT
(BY SRI. N. DEVARAJ, ADVOCATE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY
STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
6
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C. PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.6 FOR THE
OFFENCE PUNISHABLE UNDER SECTIONS 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.815 OF 2011
BETWEEN:
SMT. VANISHREE B R W/O SIDDAVEERAIAH
R/AT H NO.1488/27, I "A" CROSS,
SIDDAVEERAPPA EXTENSION,
DAVANAGERE.
... APPELLANT
(BY SRI. MOHAMMED MUJASSIM, ADVOCATE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
7
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.3 FOR THE
OFFENCE PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.967 OF 2011
BETWEEN:
1 . SHRI. SHIVAMURTHAIAH
S/O MAHADEVAIAH,
2 . SHRI. MAHADEVAIAH
S/O SHIVAMURTHAIAH
BOTH R/AT H. NO.491,
BELIKERE ROAD,
SHAMNUR VILLAGE,
DAVANAGERE.
... APPELLANTS
(APPELLANT NO.1 IS ABATED
VIDE ORDER DATED.06-06-2023, IN Crl.A.No.792/2011;
BY SRI. N. DEVARAJ. ADVOCATE FOR A2)
8
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C. PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANTS / ACCUSED NOS.7 AND 8
FOR THE OFFENCE PUNISHABLE UNDER SECTION 120(b)
READ WITH SECTIONS 468, 471, 477(A) AND 420 IPC.
THESE CRIMINAL APPEALS HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT ON 22.09.2023 THIS DAY, THE
COURT PRONOUNCED THE FOLLOWING:
9
JUDGMENT
The Crl.A.No.780/2011 is filed by the appellant/accused
No.1, Crl.A.No.812/2011 is filed by the appellant/accused
No.5 (died during the pendency of the appeal),
Crl.A.No.813/2011 is filed by the appellant/accused No.2.
Crl.A.No.814/2011 is filed by the appellant/accused No.6.
Crl.A.No.815/2011 is filed by the appellant/accused No.3.
Crl.A.No.967/2011 is filed by the appellants/accused Nos.7
and 8 (during the pendency of the appeal the first
appellant - accused No.7 died) and Crl.A.No.792/2011 is
filed the appellant/ accused No.9 under Section 374 (2) of
Cr.P.C. for setting aside the judgment of conviction and
sentence passed by the XXXII Additional City Civil and
Sessions Judge and Special Judge for CBI cases, Bengalore
(CCH-34) in Spl.C.C.No.09/2008 dated 05.07.2011 for
having convicted and sentenced the appellants to undergo
imprisonment and fine for the offences punishable under
Sections 120(B) read with Section 468, 471, 477(A) and 420
of IPC against all the accused and under Sections 13 (1) (d)
read with Section 13 (2) of Prevention of Corruption Act,
1988, as against accused No.1 in Crl.A.No.780/2011.
02. During pendency of the appeal the
appellant/accused No.6 in Crl.A.No.814/2011 died and the
appellant No.2 i.e., accused No.7 in Crl.A.No.967/2011 also
died. The accused No.4 was died prior to filing the appeal
and charges stand abetted.
03. Heard the arguments of the learned Senior
Counsel for the appellant/accused No.1 in Crl.A.No.780/2011
and counsel for the appellants in other cases and the Special
Counsel for the CBI.
04. The appellants are accused persons and the
respondents are the complainant / prosecution before the
Trial Court. The ranks of the parties are retained for the
convenience.
05. The case of the prosecution is that the accused
No.1 - R. Shiva Kumar who was Manager of the UCO Bank,
Indra Nagar Branch, Davanagere. During his tenure as a
Manager at Davanagere between 05.05.2002 to 12.08.2004
functioning as a public servant, conspired with the other
accused persons. Accused Nos.2 to 9 have filed applications
for seeking various loans applications for the purpose of
purchase of pipes accessories submersible pumps, two
wheeler tipper and other agricultural equipments. They have
forged the documents and produced before accused No.1 as
genuine to cheat the Bank and without following the
procedure and guidelines of RBI, the accused No.1
sanctioned loans to the accused Nos.2 to 7 which is as
under:-
Sl Nature of the Date of To whom Nature of the
No loan, quantum of Sanction sanctioned collateral
sanction and security
disbursement
1. UCO Megha Cash 12.06.2004 A.2 Land Sy.No.53,
Loan Siddaveerai 1/P2 of
Rs.10,00,000/- ah Bennikode with
godown valued
at
Rs.19,55,000/-
2 UCO Megha Cash 03.06.2004 A.3 Land
Loan Vanishree Sy.No.53/3 of
Rs.10,00,000/- w/o A.1 Bennikode
valued at
Rs.15,90,000/-
3 UCO Megha Cash 28.05.2004 A.4 House property
Loan Rajashekha in
Rs.10,00,000/- raiah Sy.No.133/53
and 62 of
Bannikode
valued at
Rs.85,29,500/-
4 Agricultural term 03.06.2004 A.5 Not created
loan Maliamma any charge on
Rs.5,00,000/- the agricultural
land.
5 UCO Megha Cash 26.05.2004 A.6 Land
Loan Siddalingas Sy.No.133 of
Rs.10,00,000/- wamy Bannikode
valued at
Rs.15,20,000/-
6. Agricultural terms 13.11.2003 A.7 Not created
loan Shivamurth
any charge
Rs.2,90,000/- aiah
over the
agricultural
land.
7. Agricultural terms 13.11.2003 A.7 Not created
loan Shivamurth any charge
Rs.1,10,000/- aiah and
Rs.1,45,000/- Mahedevaia
over the
h agricultural
land
06. It is further alleged that the loans were
sanctioned by the accused No.1 on the forged documents by
violating the norms. The loans were not utilized for the
purpose which were sanctioned and caused wrongful loss to
the Bank, thereby wrongful gain made by the accused Nos.2
to 7. The accused No.8 said to be guarantor and accused
No.9 said to be the scribe of the loan applications. All the
accused persons have committed the offence under the
provisions of IPC and the accused No.1 also committed
offence punishable under Sections 13 (1) (c) (d) and 13 (2)
of P.C. Act by causing wrongful loss to the Bank for
Rs.62,88,907/-. The CBI after receipt of the complaint,
registered the FIR against the appellants in FIR
No.RC.20(A)/2005/BLR dated 27.09.2005, initially for the
offence punishable under Section 120(B) read with Sections
409 and 420 of IPC. After the investigation the charge-sheet
came to be filed for the offences punishable under Sections
120(B) read with Sections 420, 468, 471 and 477 (A) of IPC
and Section 13 (2) read with Sections 13 (1) (c) and (d) of
P.C. Act, 1988.
07. Accused persons appeared before Trial Court and
they have been released on bail. The charges were framed.
They have denied the charges and claimed to be tried.
Accordingly, the prosecution called upon to adduce evidence.
08. To prove its case the prosecution in all examined
16 witnesses as PWs.1 to 16 and marked 166 documents and
no material objects were marked. After closing of prosecution
evidence, statement under Section 313 of Cr.P.C. recorded.
The incriminating evidence has been read-over to accused.
Their case is totally denial and they have not led any
defence. After hearing arguments, the Trial Court found
accused as guilty, convicted and sentenced to undergo
imprisonment as under:-
i. The A.1 to A.3, A.5 to A.9 are convicted and
sentenced to undergo simple imprisonment for
one year for the offence punishable under
Section 120B of IPC.
ii. The A.1 to A.3, A.5 to A.9 are convicted and
sentenced to undergo SI for one year for the
offence punishable under Section 420 of IPC and
shall pay fine of Rs.5,000/- each and in default
of fine, they shall undergo simple imprisonment
for 06 months.
iii. The A.1 to A.3, A.5 to A.9 are convicted and
sentenced to undergo SI for one year for the
offence punishable under Section 468 of IPC and
shall pay fine of Rs.5,000/- each and in default
of fine, they shall undergo simple imprisonment
for 06 months.
iv. The A.1 to A.3, A.5 to A.9 are convicted and
sentenced to undergo SI for one year for the
offence punishable under Section 471 of IPC and
shall pay fine of Rs.5,000/- each and in default
of fine, they shall undergo simple imprisonment
for 06 months.
v. For the offence punishable under Section 477A,
the A.1 to A.3, A.5 to A.9 are convicted and
sentenced to undergo SI for one year and shall
also pay fine of Rs.5,000/- each and in default of
payment of fine, they shall undergo SI for 06
months.
vi. For the offence punishable under Section 13 (2)
read with Section 13 (1) (d) of Prevention of
Corruption Act, 1988, the accused No.1 shall
undergo SI for 1 year and shall also pay fine of
Rs.5,000/- and in default of payment of fine, he
shall undergo simple imprisonment for 06
months.
09. Being aggrieved by the judgment of conviction
and order of sentence the appellants are before this Court.
10. The learned Senior Counsel appearing for the
appellant Sri P. S. Kulakarni, has contended that the accused
No.1 being a Bank Manager, has accorded sanction for loan
applications filed by the accused Nos.2 to 7. They have
produced the documents along with the applications. The
accused No.1 has sent the same to the legal advisor of the
Bank. In turn the legal advisor given legal opinion. Based
upon the legal opinion, the loan has been sanctioned. He has
not violated any of the guidelines issued by the RBI. He
further contended that even the guidelines has not been
produced by the prosecution and marked before the Court to
show that which of the guidelines has been violated by this
appellant. He further contended that there is no sanction
obtained by the prosecution to file charge-sheet against this
appellants. Even otherwise there is no loss to the Bank as
the borrowers repaid the loan amounts. He further contended
that there is no offence to attract Section 13 of the P.C. Act
to show that he has received any gratification for sanction of
the loan. There is no conspiracy between the this appellant
and other accused for creating any documents. Absolutely
there is no material to show that this appellant has cheated
the Bank and participated in creating the documents. The
Trial Court has drawn an inference under Section 120 (B) of
IPC. There is no evidence on record against this appellant.
There is no dishonest intention to show that this appellant
with a criminal intention to cheat the Bank, has granted any
loan. Therefore, he has contended absolutely there is no
evidence against this appellant for convict the appellant. The
Trial Court has committed an error in convicting this
appellant. The very complainant who registered the FIR has
not been examined. The FIR was marked through the PW.15
the investigating officer, thereby the very complainant itself
is not sustainable. The source report for registering the FIR
also produced and marked. Therefore, prayed for allowing
the appeal.
11. The learned counsel for the other appellants /
borrowers - Accused Nos.2, 3, 6 and 8, also taken the similar
contentions that they have borrowed the loan for purchase of
agricultural equipments which was sanctioned after the legal
opinion. The amount has been already repaid. The Trial Court
has not considered the loan repaid by the appellants at all.
The account has been opened and the loan amount has been
transferred which was withdrawn. He further contended that
the Investigating Officer - PW.15 stated in the cross-
examination that the amount withdrawn by accused No.5 and
only they came to know after the CBI enquiry. The accused
No.3 wants money for going abroad for higher study. The
property of the accused Nos.2 and 3 has not mortgaged and
no documents were executed by the accused Nos.2 and 3.
There is no findings given by the Trial Court in this regard.
The learned counsel for the accused Nos.6 and 8 also
contended that they are borrowers of Megha Cash Loan and
accused No.8 was guarantor and co-applicant. There was
agricultural term loan obtained by accused No.8. The
accused No.7 is father of the accused No.8. There is no
signature of accused No.6 on the loan application, the
accused No.6 is only the co-obligant for accused Nos.7 and 8.
Subsequently, accused No.7 and 8 have repaid the loan
amount fully. There is no default in the loan amount. There is
no question of cheating and causing loss to the bank. The
accused No.6 has not filed any application for loan, but the
loan sanctioned and withdrawn.
12. The learned counsel for the accused No.9 has also
contended that the accused No.9 is not a borrower, he is
only a scribe and he has prepared the application for loan,
but he has not signed. Such being the case, there is no
material placed on record to show that this appellant was
committed any offence. Absolutely there is no material to
convict this appellant. Hence, prayed for allowing the appeal.
The learned counsel for the other appellants are also taken
similar contentions and prayed for allowing the appeals.
13. Per contra, the learned counsel for the CBI has
contended that in respect of the loan sanctioned by the
accused No.1 was already dismissed from service at the time
of filing charge-sheet. Therefore, no sanction is required.
Even if the loans were repaid that cannot be a ground for
acquitting the appellants. There is a violation of guidelines
issued by the RBI. The accused No.1 sanctioned the loan for
pecuniary advantage as a public servant, which amounts to
misconduct. The FIR was marked through Investigating
Officer and that is permissible under the law. The accused
No.1 has not denied the sanction of loan. His specimen
signature are not required to sent to FSL for hand writing
experts. When sanction of loan was not disputed, the
question of proving the same does not arise.
14. The learned counsel further contended that as
regards to the conspiracy, it cannot be a direct evidence, it is
a matter of inference. The evidence reveals that there is
collusion of accused No.1 and other accused. The prosecution
is successful in proving the guilt of the accused. The
judgment of the Trial Court does not call for any interference.
Hence, prayed for dismissal of the appeals.
15. Having heard the arguments and perused the
records, the points that arise for my consideration are as
under:-
i. Whether the prosecution proves beyond all reasonable
doubt that the accused No.1 and other accused were
conspired with each other to cheat the Bank and loan
sanctioned by the accused No.1 on created and
fabricated documents, which caused wrongful loss to
the UCO banker, thereby the accused committed
offences punishable under Sections 120(B) read with
Sections 468, 471, 477 and 420 of IPC against all the
accused and under Sections 13 (1) (d) read with
Section 13 (2) of Prevention of Corruption Act.?
ii. Whether the appellant No.1 is being a public servant for
illegal gratification mis-sued the power by sanctioning
the loan to the other accused, thereby committed
offences punishable under Sections 13 (c) (d) and 13
(2) of P.C. Act.?
iii. Whether the judgment of the Trial Court called for any
interference.?
16. Before going to appreciate the evidence, the
evidence adduced by the prosecution witnesses is required to
be mentioned herein.
17. PW.1 - K. G. Subramanyan who was Assistant
Chief Manager of the Bank, has deposed that he was working
in the said Bank as a official for scrutinizing the loan. The
accused No.1 was working as Manager of UCO Bank, at
Davanegere. When he received the applications and loan
documents and verify in connection with the Vanishree -
accused No.3 as per Ex.P.1 and Rajshekharaiah - accused
No.4 - co-applicant, wherein he has not put his signature on
the application and on the guarantor statement as per -
Ex.P.2. On perusing the loan documents, he could not found
the legal opinion furnished by the panel advocate. He further
deposes that the loan application of the accused No.4 which
is marked as Ex.P.3. The co-applicant accused No.5, was not
put his signature on the application. On verifying the said
loan records he found that the agricultural land was taken for
collateral security. The land could not be taken as collateral
security, though, it was taken as security. He further deposes
that he also verified loan application of Siddalinga Swamy
accused No.6 as per Ex.P.5, neither the accused No.6 nor the
co-applicant accused No.9 were signed on the Ex.P.6. The
guarantor statement of the accused No.9 as per Ex.P.7,
where he has found, the loan records, the Megha Cash loan
was granted by taking the agricultural land as a collateral
security.
18. He further deposes that the loan application of
accused No.5 - Mallamma which is at Ex.P.8, there is no
process note. The accused No.1 sanctioned the loan of
Rs.5,00,000/-, even though he had power to grant loan only
for Rs.2,00,000/-. He has also verified the loan application of
accused No.7 - Shivamurthaiah, which is at Ex.P.9, which
has no process note. The guarantor - accused No.6
statement is marked as Ex.P.6. On verifying the loan
documents, there was no process note in the loan
application. He further deposes that the loan application of
accused No.7 - Shivamurthaiah and accused No.8
Mahadevaiah is Ex.P.7 and there is no process note. The
accused No.6 was guarantor, his statement is marked at
Ex.P.12. The accused No.1 is power to grant loan for
Rs.2,00,000/-, but he has granted loan of Rs.2,90,000/-.
19. During the cross-examination made to the
accused No.1, he has admitted that Ex.P.1 is loan application
of accused No.3 who is sole applicant and there is no co-
applicant and no signature column in the application and
accused No.4 was the guarantor.
20. He further admits that as per Ex.P.58, the panel
advocate given opinion in respect of properties of accused
No.4 - the co-obligator. Though, he has stated that there was
guidelines of RBI, where the agricultural land could not be
taken as security, but he has admitted no such guidelines
produced before the CBI. He further admits that there is E.M.
register for verification of the loan by the Bank in every loan,
but, he has not verified the E.M. register in connection with
loan of accused No.4. He also admitted that the loan
application was not signed by the loanee, but at subsequent
stage the Manager may ask the loanee to execute fresh loan
application. He further admits that the accused No.6 in
Ex.P.5 not bear the signature and he has not went to the
land for spot inspection. He further admits that even if the
signature was not taken on the loan application, it would not
effect for recovery proceedings. He also admits that he has
not produced the guidelines and sanction power of the
Manager for granting the loan. On perusal of evidence of this
witness, all the cross-examination admitted by him. He has
not produced the guidelines either to the CBI or to the Court
to show that there was restriction in granting the loan by
accused No.1 and he has exceeded the loan. He further
admits that there is no co-applicant on the loan application.
21. PW.2 - Mohemmad Gouse, who is the Retired
Income Tax Officer has deposed that he was worked as I.T.
Officer in Ward No.3 at Davanegere. The CBI Officer came to
his office and shown two I.T. returns and he has verified the
records and found that no such I.T. returns have filed in the
I.T. Office. He has produced the Exs.P.13 and 14 which were
copies of the I.T. returns, but no original I.T. returns were
traced in his office. He has verified the Ex.P.13 which was
affixed with the seal and date as 17.08.2003 and Ex.P.14
dated 05.07.2003. All these two days were holidays i.e.,
Saturday and Sunday. There is no possibility of receiving the
original I.T. returns in his office. During his cross-
examination, he admits that Ex.P.13 is in respect of Ward
No.3 and Ex.P.14 is in respect of Ward No.2. However, the
address found in both the documents falls within his
jurisdiction. He admits that he has not intimated to his
supervisor regarding ward number wrongly mentioned and
he has not stated before the CBI the numbers were wrongly
mentioned. In the further cross-examination, he admits that
the form is received in bulk and they used to give the
acknowledgment on the next day if there was more work in
the office.
22. According to his evidence, Exs.P.13 and 14 the
Income Tax Return produced by the guarantor was a fake
document and there is no original found in his office. Both
the documents were said to be submitted in the I.T. office on
the holidays, where no such application received physically in
the holidays.
23. PW.3 - N. Sayi Raj another I.T. Officer of Ward
No.2, has deposed that the CBI officer came and shown the
Ex.P.15 the copy of the I.T returns and asked the original of
the same. He has stated that the Ex.P.15 is not pertaining to
his office at Ward No.2 in Shivamogga. The acknowledgment
at Ex.P.15 (a) is also not found in his office. During the
cross-examination he has admitted that he cannot say
whether Ex.P.15 is genuine or not. He has not produced the
blue book before the CBI officer, as the CBI officer has not
asked that document. He further admits that without
verifying the record in the I.T. office, he could not make out
that they are forged documents. In the further cross-
examination he stated that the accused Nos.2 to 6 have not
produced the specimen seal before the CBI office and further
admits that the I.T. returns pertaining to the outside
jurisdiction. He further admits that the original of Ex.P.15
was filed in his office and he has sent the same to the
Shivamogga Office, as it was pertaining to that jurisdiction.
24. PW.4 - S. Ravishankar a Deputy Chief Officer of
UCO Bank, Zonal Office, at Bangalore, has deposes that he
was successor to the accused No.1 who was working as Bank
Manager in Davanegere Branch. In the year 2004-05 the CBI
officer requested to furnish the documents in connection with
the loan transaction and he has produced the same. He has
stated that the Ex.P.16 is loan application of accused No.2
and accused No.4 was guarantor which is Ex.P.17. He also
identified the statement of accused No.2 which is at Ex.P.18
and he has stated that process note regarding loan
application by accused No.1 is at Ex.P.19, which is hand
writing of accused No.1. He has also identified the legal
opinion in connection with above said opinion at Ex.P.20. The
Valuation Report made by the valuer - L.S. Shashidhar is at
Ex.P.21. The I.T. returns of accused No.2 is at Exs.P.13 and
14. The accused No.1 prepared the attestation memo which
is at Ex.P.22. The accused No.2 executed a letter of accused
No.1 which is at Ex.P.23. The letter of revival executed by
the accused No.2 is marked at Ex.P.24. The accused No.2
executed D.P. note which is at Ex.P.25. The loan agreement
executed by accused No.2 is at Ex.P.26. The accused No.2
executed a letter in favour of UCO Bank for creating
mortgage deed is at Ex.P.27. The confirmation letter
regarding deposit of title deed is at Ex.P.28.
25. He further deposes that the accused No.4 was a
guarantor and he has executed a letter of guarantee is at
Ex.P.29. The agricultural land valuation report is at Ex.P.30.
The S.B. account of accused No.2 is at Ex.P.31. The accused
No.1 has authorized to accused No.2 to open is at Ex.P.31
(d). The specimen signature card of accused No.1 with photo
is at Ex.P.32. The declaration given by accused No.1 is at
Ex.P.33. The debit letter is dated 12.06.2004 for
Rs.10,00,000/- is at Ex.P.34 which is prepared by the
accused No.1. The hand writing of the accused No.1 is at
Ex.P.34 (a). He further deposes that the voucher dated
12.06.2004 in hand writing of accused No.1 is at Ex.P.35.
The credit voucher of the accused No.2 is at Ex.P.35. The
accused No.2 has withdrawn the amount by check is at
Exs.P.36 and 37. The statement of account of the loan is at
Ex.P.38.
26. He further deposes that the Megha Cash Loan
Application of accused No.3 - Vanishree is at Ex.P.1. The
statement is at Ex.P.39. The letter of guarantee is issued by
accused No.4 - Rajshekhar is at Ex.P.2. The accused No.1
prepared process note which is at Ex.P.40. The valuation
report is at Ex.P.41. The I.T. returns of accused No.3 is at
Ex.P.14. The accused No.1 prepared the attestation memo is
at Ex.P.42. The accused No.3 executed a letter is at Ex.P.43.
The letter of revival of accused No.3 is at Ex.P.44. The D.P.
note of accused No.3 is at Ex.P.45. The loan agreement of
accused No.3 is at Ex.P.46. The guarantor letter of accused
No.4 is at Ex.P.47. The valuation report of the agriculture
land is at Ex.P.48.
27. He further deposes that accused No.3 has opened
S.B. Account is at Ex.P.49. The accused No.1 authorized to
open the account is at Ex.P.49 (d). The specimen signature
with photo of accused No.3 is at Ex.P.50. The declaration
form of the accused No.3 is at Ex.P.51. The debit voucher of
accused No.3 is for Rs.10,00,000/- is at Ex.P.52. The
accused No.1 passed order is at Ex.P.52 (a). He further
deposes that the credit voucher issued by the accused No.1
for Rs.10,00,000/- is at Ex.P.53 and accused No.3 said to be
received the amount and slips dated 03.06.2004 as per
Ex.P.54 for received Rs.09,90,000/-. The loan application of
accused No.4 is at Ex.P.3 and the statement is at Ex.P.55.
However, the accused No.4 has not put his signature. The
process note in tow sheets prepared by accused No.1, which
is marked as Ex.P.56. The legal opinion given by Sri. M. N.
Keshavan is at Ex.P.57. The valuation report of the land is at
Ex.P.58. The I.T. returns of accused No.4 is at Ex.P.59. The
accused No.1 attested a memo which is at Ex.P.60. The letter
of driver of accused No.4 is at Ex.P.61. The blank letter of
revival issued by accused No.4 is at Ex.P.62. The D.P. note of
accused No.4 is at Ex.P.63. The loan agreement of accused
No.4 is at Ex.P.64. The letter of guarantor issued by accused
No.5 is at Ex.P.65. The valuation report of the land is at
Ex.P.66.
28. He further deposes that accused No.4 has opened
the S.B. Account as per the application is at Ex.P.67. The
accused No.1 authorized to open the account by affixing the
signature. The specimen signature card of accused No.4 is at
Ex.P.68. The Declaration Form of accused No.4 is at Ex.P.69.
The debit voucher for loan of Rs.10,00,000/- is at Ex.P.70.
The accused No.1 has issued the credit voucher is at Ex.P.71.
The accused No.1 issued two cheques for receipt of amount
is at Ex.P.72 and 73. The statement of account of accused
No.4 is at Ex.P.74.
29. He further deposes that Megha Cash Loan
application of accused No.6 is at Ex.P.5. The statement of
accused No.7 is at Ex.P.6. The accused No.1 is not signed on
the Ex.P.5. The process note is at Ex.P.75. The guarantor
statement executed by accused No.9 is at Ex.P.7. The
opinion of the panel advocate is at Ex.P.76. The valuation
report is at Ex.P.77. The memorandum of patrician is at
Exs.P.78 and 79. The loan agreement of accused No.6 is at
Ex.P.80. The letter of confirmation of title deeds deposit is at
Ex.P.81. The letter of guarantee is at Ex.P.82 issued by
accused No.9. The loan valuation report of land is Ex.P.83.
30. He further deposes that application of opening of
account of accused No.4 is at Ex.P.4. Authorization to open
the account issued by Krishnamurthy, the specimen
signature of accused No.6 is at Ex.P.85. The declaration form
of accused No.6 is at Ex.P.86. The debit voucher is at
Ex.P.87. The credit voucher issued by accused No.1 is at
Ex.P.88. The cheques issued by the accused No.6 for
withdrawing the amount is at Exs.P.89 and 90. The
statement of loan account is at Ex.P.91.
31. He further deposes that the agricultural term loan
application of accused No.5 is at Ex.P.8. The invoices of
ESSKAY Enterprises are at Exs.P.92 to 95. The hypothecation
agreement of accused No.5 is at Ex.P.96. The statement of
account is at Ex.P.97. The letter of guarantee is at Ex.P.98.
32. He further deposes that application of accused
No.7 and accused No.8 is at Ex.P.9. The statement of
guarantor executed by accused No.6 is at Ex.P.10. Two
invoices of Vani Agro Industries is at Ex.P.99 and 100. The
letter of confirmation executed by accused Nos.7 and 8 is at
Ex.P.101. The letter of guarantee of accused No.6 is at
Ex.P.102. The Hypothecation agreement is at Ex.P.103. The
attestation memo of accused No.1 is at Ex.P.104.
33. The loan application of accused Nos.7 and 8 is at
Ex.P.11. The statement of guarantor by accused No.6 is at
Ex.P.12. The Krishna Engineering Company issued invoices
and another invoice of COTMAC Private Limited, issued by
ESSKAY Enterprises are at Ex.P.105 to 109. The letter of
depositing the title deeds is at Ex.P.110. The letter of
guarantee of accused No.10 is at Ex.P.111. The
hypothecation is at Ex.112. The valuation report of the land
is at Ex.113. The opinion of advocate is at Ex.P.114.
34. The said witness further deposes that the credit
voucher issued by the accused No.1 for Rs.3,00,000/- is
marked at Ex.P.15 and attestation memo prepared by
accused No.1 is at Ex.P.116. The loan opening application of
accused No.7 is at Ex.P.117. The authorization of loan
application also given by one Krishnamurthy. The specimen
signature card of accused No.7 is at Ex.P.118. The credit
voucher for Rs.2,90,000/- is at Ex.P.119. The another credit
voucher of accused No.7 for Rs.1,10,000/- is at Ex.P.120.
The withdrawal slip of accused No.7 is at Ex.P.121. The
accused No.6 received cash by withdrawal slip and
withdrawal slip of accused No.7 is at Ex.P.122.
35. This witness further deposes that the memo
prepared by the accused No.1 regarding loan of accused
No.5 - Mallamma is at Ex.P.123. The valuation report is at
Ex.P.124. The S.B. account opening Form of accused No.5 is
at Ex.P.125. The authorized also issued to open the account.
The specimen signature card of accused No.5 is at Ex.P.126.
The Declaration Form of accused No.5 is at Ex.P.127. The
debit voucher prepared by accused No.1 for Rs.5,00,000/- is
at Ex.P.128. The credit voucher of accused No.1 is at
Ex.P.129. The withdrawal slip of accused No.5 is at Ex.P.130.
The valuation report also marked as Ex.P.131.
36. The witness further deposes that the credit
voucher is at Ex.P.132. The debit voucher is at Ex.P.133. The
withdrawal slip of accused No.7 is at Ex.P.134. The
withdrawal slip of accused No.7 is at Ex.P.135. The another
withdrawal slip of accused No.7 for Rs.2,00,000/- is at
Ex.P.136.
37. The witness further deposes that the accused
No.5 executed the Form No.3 is at Ex.P.137. The legal
opinion of the Panel Advocate is at Ex.P.138. The Declaration
Form of accused No.7 - Shivamurthaiah is at Ex.P.139. The
letter of deposit of title deeds is at Ex.P.140. The letter of
confirmation issued by accused No.6 deposit of title deeds is
at Ex.P.141. The accused No.6 has also executed the another
letter for depositing the title deeds for creating mortgage is
at Ex.P.142.
38. This witness further deposes that the accused
No.9 - Srikanth Kulkarni, was executed a letter of guarantee
is at Ex.P.143. The accused No.5 executed a consent letter is
at Ex.P.144.
39. The statement of account with Megha Cash Loan
of A2 is at Ex.P.145. The statement of account of accused
No.3 - Vanishree regarding Megha Cash Loan is at Ex.P.146.
The statement of account with regard to Megha Cash Loan of
accused No.4 is at Ex.P.147. The statement of Megha Cash
Loan of accused No.6 is at Ex.P.148. The statement of
account regarding loan application of accused No.5 is at
Ex.P.149. The statement of account of accused No.7 is at
Ex.P.150. The credit voucher in the hand writing of accused
No.1 is at Ex.P.151. The amount Rs.2,00,000/- credited to
the account of accused No.6 and the valuation report of
agricultural land is marked as Ex.P.152.
40. In the cross-examination of the learned counsel
for accused No.1, he has admitted that he has not gone to
the land of the PW.1 and further admits that the legal
opinion issued for granting loan of accused No.2 as per
Ex.P.2. He further admits that the accused No.1 received the
valuation report as per Ex.P.21 for granting loan to the
accused No.2.
41. He further admits that he has not furnished the
documents before the CBI regarding guidelines for sanction
of Megha Cash Loan. He further admits that as per Ex.P.20
the title of property was perfect and mortgage could be
created. He further admits that the lands documents are
furnished for collateral security for Megha Cash Loan. The
said lands standing brought to the sale in the Final Decree
Proceedings if decree was passed. Though, he has denied
that the agricultural land cannot be taken as collateral
security for Megha Cash Loan, but he has not produced the
such prohibition for taking decision as security.
42. He further admits that he cannot say that the
valuation mentioned in the Ex.P.41 regarding loan application
of accused No.3 was just and proper for recovering the loan
granted to the accused No.3. He further admits that the
accused No.4 also obtained the loan and loan was granted
after verifying the require documents and legal opinion of the
panel advocate is at Exs.P.58 and 59. He further admits that
the accused No.5 was also availed loan by producing the
valuation report as collateral security. He further admits that
accused Nos.7 and 8 were availed loans by producing the
loan application. The legal opinion was obtained from the
advocate as per Exs.P.76 and 77.
43. In the cross-examination the learned counsel for
accused Nos.2 to 6 further admits that if the application filed
by single person, he could allow to sign the application. The
Bank has receives huge number of applications for grant of
Megha Cash Loan. The loan used to be sanctioned after
verifying the documents. He further admits that the loans
were sanctioned after producing the title deeds and the loan
application of the accused No.2 was filed. The account was
opened by accused No.3 introducing by an advocate one
Basappa. The accused No.3 filed loan application and later
the amount has been withdrawal.
44. He further admits that the accused No.4
introduced Advocate - Kotrappa. The Ex.P.67 opening of the
S.B. account. The loan was sanctioned. The Kotrappa
introduced accused No.6. The accused No.6 was guarantor
for agricultural loan of accused Nos.7 and 8. The accused
No.6 deposed that the title deeds and he was surety to the
accused Nos.7 and 8. He further admits that the accused
Nos.7 and 8 are not default in payment and they paid the
amount.
45. On perusal of the evidence of this witness, it
shows that the loan application was filed by accused Nos.2 to
8, amongst them, they have given security by producing the
letter of confirmation as a guarantor. They have submitted
the title deeds. After verifying the documents the loans were
sanctioned after obtaining the legal opinion from the panel
advocate. It is also seen that the violation alleged against
accused No.1 that he has sanctioned the loan by taking the
agricultural land as collateral security which is violation of the
guidelines, but no such guidelines produced by the
prosecution and marked to show that there was violation of
norms as committed by the accused No.1 while sanctioning
the loan. It is admitted fact that prior to the sanction of loan,
the valuation report and legal opinion received by the
accused No.1, then sanction order was passed and loan were
disbursed and withdrawn by the other accused persons. Later
the loan amount were repaid by the borrowers and evidence
of this witnesses which is not used for prosecution.
46. PW.5 - Sri. M. N. Keshavan, is the panel advocate
for the Bank. He has deposes that he has issued the legal
opinion as Ex.P.20 for loan belongs to accused No.2. The
Ex.P.153 is his covering letter. The legal opinion given to the
accused No.5 is at Ex.P.57 and legal opinion is at Ex.P.58
regarding the loan of accused No.4. The Ex.P.76 is the legal
opinion for loan application of accused No.6. The Ex.P.114 is
the legal opinion for loan of accused No.7. The Ex.P.138 is
the legal opinion for loan of accused No.4. He further says
that he has furnished the legal opinion and send to the
accused No.1 with covering letter. In the cross-examination
he has admitted that Ex.P.57 is opinion regarding Mallamma
and Ex.P.58 is valid title deed belongs to the Rajashekaraiah.
Ex.P.77 is valid title deed of the Siddalingayya and he has
given opinion that mortgage can be created through
registered instrument as all the documents are valid
documents including the title deeds of Shivamurthy as
Ex.P.114. Accordingly, he has given legal opinion for the loan
pertaining to the accused persons based upon the
documents. His evidence is not useful to the prosecution, on
the other hand it is helpful to the accused No.1.
47. PW.6 - Kubero Naidu who is the businessman
running the shop in the name of ESSKAY Pipe Centre dealing
with P.V.C. pipe and plumbing material. He deposes that
about 04 years back the CBI officer enquired about the
invoice at Exs.P.108 and 109 which were not issued by him
and they are not in his hand writing. The letter head used is
not of his shop. He also verified Ex.P.94 and Ex.P.95 invoices
shown to him and he has identified that those are the
quotations which is in his hand writing. He has not stick the
quotation and he has not written the bill and he has not
supplied the material shown in Exs.P.94 and 95.
48. During the cross-examination he has stated that
there were 04 persons working in his shop and in his absence
his Manager use to write the bills and issue the quotation.
Exs.P.94 and 95 are in his hand writing. He has not enquired
his Manager about over writing on the originals and he
cannot say who obtained the quotation from his shop and
denies the Exs.P.108 and 109 were not issued from his shop.
He has also deposes that he has enquired officials of the
shop, they have also told that it was not issued by them.
However, he admitted in the cross-examination by the
learned counsel for the accused Nos.2 to 6 that Exs.P.95 and
96 were issued in the name of Mallamma - accused No.5.
49. On perusal of his evidence it shows that though
quotations were issued as per Exs.P.94 and 95 in the name
of Mallamma - accused No.5, but the invoices as per
Exs.P.108 and 109 were not issued by him and he has also
stated that no materials were supplied, as per the
quotations.
50. PW.7 - Mruthunjaya M.S. an accountant in
ESSKAY enterprises also deposes that the CBI police officials
shown the Exs.P.92 and 93 to verify whether the same were
issued by his enterprises. He has also stated that Exs.P.92
and 93 are the quotations, but not bills. He has also verified
the Exs.P.106 and Ex.P.107 and stated that the said bills
were not issued from their shop. In the cross-examination of
learned counsel for accused No.1, he has admitted that there
are 4 to 5 persons were working. The owner alone issued the
quotations and he has not enquired with the officials whether
Exs.P.92 and 93 were issued by them. He admits that there
is no legal Bar for issuing typed bills and Ex.P.107 contains
the CST and KST numbers. In the cross-examination of
accused No.9 he has stated that Srikant Kulakarni not the
proprietor. He admits in the cross-examination of learned
counsel for accused Nos.2 to 6 that the Exs.P.92 and 93 are
in the hand writing of Sri. V.N. Srikant and further admits
that anybody can avail the quotation in the name of others.
51. PW.8 - Chandrashekhar A. H. who is a
businessman running a Vani Agro Industries, dealing in
Tractor, Trailer and Accessories. He has deposed that the CBI
police enquired about Ex.P.99. He has stated that it was not
issued by him and the letter head also not belongs to his
industries. The hand writing also not that of him or his
employees. He has also deposes that the Ex.P.100 is
quotation, it was issued by his industries one Sri. Wagesh,
Sales Executive put his signature, but he has stated that
they have not supplied the materials for Rs.1,47,100/-. In
the cross-examination, he has admitted that Exs.P.99 and
100 contains the CST and KST numbers and both the
documents are having the name of similar letter head and
ordinary person cannot make out the creation. According to
his evidence though quotations were issued for showing the
value of the materials, but no materials were supplied for the
said amount.
52. PW.9 - K. Shivaraj, the Assistant Manager in
COTMAC Private Limited, has deposed that the CBI officer
shown the quotation as per Ex.P.106. He has stated that it is
not issued by his concern and hand writing is also not that of
himself. In the cross-examination, he has stated that on
looking to the Ex.P.106, he cannot say whether it is created
or not. In the further cross-examination of accused Nos.7
and 8, he has admitted that there are separate letter heads
for issuing quotation and issuing bills. The CBI officers have
not collected the letter head with the logo of their concern.
53. PW.10 - V.J. Umesh, another businessman of
Krishna Engineering Company also deposed that the CBI
officers have shown the Ex.P.105 the quotation and enquired
about it, but it was not issued by him and they are not
having any printed quotation, but they are using to issue
quotation in the letter head of his shop. In the cross-
examination, he has stated that Ex.P.105 contains the CST
and KST numbers and also stated that he cannot say
whether it was issued by his shop or created one and he is
only a partner and identified the Ex.P.105. Accordingly, as
per this witness the Ex.P.105 was not issued by him.
54. PW.11 - Sri. N. K. Rajakumar, who is a consulting
engineering running a Firm in the name of R.K. Associates
and he is also doing as authorized valuer of UCO Bank
Davanagere and also other Banks. In the year 2006 the PW.4
requested to undertake the value of 05 properties.
Accordingly, he has visited the spot and valued the
properties and prepared the valuation report. Ex.P.30 is the
valuation report in respect of land in Sy.No.53/1B2
measuring 02.21 guntas situated at Bannikode village and he
has valued the land at Rs.2,44,925/-.
55. He further deposes that he also valued the land
Sy.No.52/3 measuring 02.14 guntas of Bennikode village as
per Ex.P.48 and valued the land at Rs.2,27,950/-.
56. He further deposed that he valued the land
Sy.No.133/1B measuring 07 acres 02 guntas, Sy.No.53/2
measuring 02.28 guntas, Sy.No.62/P1 measuring 01.07
guntas and Sy.No.133/P11 measuring 02.20 acres and given
valuation report as per Ex.P.66 and he has valued the above
said lands at Rs.24,89,000/-.
57. He further deposes that he has also valued the
land Sy.No.133/P10 measuring 03.02 guntas of Bennikodi
village as per Ex.P.83 and valued at Rs.5,07,800/-. He has
valued the land Sy.No.31/1P measuring 05 acres situated at
Muktenahalli village and issued the report as per Ex.P.131
and valued at Rs.4,85,000/-.
58. In the cross-examination of learned counsel for
the accused No.1, he has admitted that the Davanagere was
under CMC Limit during the year 2005-06. The lands
surrounding the Davanagere has been escalated. He has
adopted the value as per the Sub-Registrar, but he has not
enclosed the documents along with the valuation report. He
further admits that he himself went to there and no other
engineer were accompanied him. He has not referred the
valuation report submitted by the accused persons. He
further admits that there is a difference in value of the
Government as well as forced value and market value. He
further admits that in the forced value a person sell the
property under the circumstances and market value is
existing surrounding the area. The comparative value means
the value adjoining with the adjoining properties. He further
admits that he has not mentioned all the 03 values.
59. According to his evidence, he has valued the
property as per the value of the Sub-Registrar for the
purpose of purchase of stamp and registration. He has not
mentioned the market value surrounding the area and there
will be difference in value between guidance value and
market value.
60. PW.12 - W. Gladys Jayanthi, the Police Inspector
working in CBI has deposed that on 10.10.2005 she has
collected specimen signature of the accused No.2
Siddaveriaha, accused No.3 - Vanishree, accused No.5 -
Mallamma, accused No.6 Siddalingaswamy, accused No.4 -
Rajashekhariah, accused No.7 - Shivamurthaiah and accused
No.8 - Mahadeviah. He has identified the signature of
accused No.2 as per Ex.P.154, signature of accused No.3 is
at Ex.P.155, signature of accused No.6 is at Ex.P.156,
signature of accused No.5 is at Ex.P.157, signature of
accused No.8 is at Ex.P.158, signature of accused No.9 is at
Ex.P.159 and signature of accused No.4 is at Ex.P.160. He
has hand-over the same to the investigation officer. In the
cross-examination of accused Nos.2 to 6, he has admitted
that he has not mentioned in the Ex.P.154 to 160 regarding
the name and address of the witnesses who are present at
the time of taking the specimen signature.
61. PW.13 - B. V. Nilkanta Joish, the Zonal Manager
of UCO Bank, deposes that when he was working as Deputy
Chief Officer Inspector UCO Bank, Bengaluru, he directed by
the DGM to inspect the UCO Bank at Davanegere.
Accordingly, he has visited the Branch. PW.4 the Manager,
he has noticed that accused Nos.2 to 4 and 6 were
sanctioned and disbursed the Megha Cash Loan. The accused
No.1 was the Manager who has sanctioned the loan based on
the security of agricultural land. The loanees produced the
loan documents, but details of occupation were not collected.
The proof of income was not collected. The installment were
fixed without considering the repayment capacity of the
borrowers. The loan applications were incomplete. He further
deposes that accused No.1 sanctioned and disbursed the loan
to accused No.5 - Mallamma, accused No.7 - Shivamurthy,
accused No.8 - Mahadevaiah and the process was not
properly done. The repayment fixed without considering the
capacity of the loanee and he has prepared report and given
to the Zonal office.
62. In the cross-examination he has admitted that he
has not produced the guidelines regarding various loans and
also admits that whether the guidelines were submitted to
the CBI officer or not. He further admits that in the loan
application of accused No.2, the occupation is shown as
agricultural and there is no I.T. returns produced to show the
income of the loanee. He further admits that he do not know
whether the loans of accused Nos.7 and 8 were already been
discharged and payments were made by them.
63. He further admits that if the payment are not
made, it would not effect the interest of the Bank and
hamper the recovery. He do not remember whether he has
verified EM creation register and he has also admits that he
has not verified the EM creation of register of loans of
accused Nos.2 to 4 and 6. He has not produced the copy of
his report to CBI officer and he further admits that he has
not seen the recovery report regarding recovery of loan
granted in favour of the accused.
64. PW.14 - Shankar Naik head casher of the UCO
Bank deposed that the Ex.P.6 is the cheque for having made
the payment Rs.3,90,000/-, Ex.P.37 is the cheque for
Rs.6,00,000/-, Ex.P.54 is the withdrawal slip of
Rs.9,19,000/-, the Ex.P.72 is the cheque is for
Rs.5,00,000/-. Ex.P.73 is the cheque of Rs.4,90,000/-. The
Ex.P.89 is the cheque for Rs.7,90,000/-. The Ex.P.19 is the
cheque for Rs.2,00,000/-, Ex.P.130 is the withdrawal slip for
Rs.4,95,000/-. Ex.P.134 is the withdrawal slip of
Rs.3,00,000/-, Ex.P.135 is the withdrawal slip for
Rs.2,50,000/-. Ex.P.136 is the withdrawal slip of
Rs.4,00,000/-, Ex.P.73 is the cheque is for Rs.4,90,000/-.
Ex.P.36 is the cheque of Rs.3,90,000/-. He has made the
payment to the persons.
65. In the cross-examination of the learned counsel
for accused No.1 submits that he has not stated in his
statement that the amounts were released from the Chamber
of accused No.1 and this witness is having separate cabin. In
the further cross-examination of accused Nos.2 to 6 he has
admitted that he has not having any idea that accused Nos.7
and 8 are permanent customer. The Kotrappa, the learned
advocate who was permanent customer who is introduced
the accused Nos.7 and 8.
66. According to his evidence the loans amounts were
disbursed to the accused on the withdrawal slip produced by
them. Since, the loan sanctioned, disbursement and
repayment were are not in dispute.
67. PW.15 - Hariom Prakash the investigating officer
has deposed that when he was working as police inspector in
CBI ACB Bengaluru the S.P. Biju Jorge registered the FIR in
RC.No.20(A)/2005 and the FIR is identified by him as per
Ex.P.161. He further deposes that the S.P. entrusted him for
investigating the matter. On 20.12.2005 he recorded the
statement of PWs.8, 10 and statement of PW.1 on
09.03.2006. He has recorded the statement of other
witnesses on various dates. He has collected the specimen
signature of accused No.1 as per Ex.P.162. Then he has
entrusted the part of the investigation to PW.12.
68. He further deposes that on 12.08.2006 he has
sent specimen signature along with the questioned
documents to the Hyderabad for getting opinion. The
specimen writing of accused No.9 is Ex.P.163 and opinion is
at Exs.P.164 and 165 and then he has completed the
investigation and the charge-sheet has been filed.
69. Since, accused No.1 was dismissed from the
service the sanction is not necessary, hence he has not
obtained the sanction.
70. In the cross-examination of the learned counsel
for accused No.1 this witness has stated that he has
prepared the documents and seizer memo for collecting the
documents in different dates, but he has not produced the
seizer memos. He further says that he has visited the UCO
Davanagere Branch, but he has not seized the attendance
register from the Branch. This witnesses denied all the
suggestions made by the learned counsel for the accused
persons.
71. PW.16 Suryaprasad a Deputy Government
Examiner Hyderabad has deposed that on 14.08.2006 his
office received, the questioned and standard documents and
he has received the same as per Q1 to Q387, Q389 to Q493,
Q495 to Q606, with some marking specimen writings in 14
sets as per S1 to S94 and S44(a). He has compared the
same and given opinion as per Exs.P.165 and 166.
72. He further stated that one Gopal was undertaking
the work of examination of the above documents. He put his
signature as Ex.P.165 (B). In the Ex.P.165 the Para Nos.1 to
6, Para Nos.12 to 14, are his opinion.
73. In the cross-examination of the learned counsel
for accused No.9, he has admitted that the CBI officer has
not sent the admitted writing and admitted signature for
identification. But he further denies that without being
admitted signature, one could not undertake work of
comparison perhaps one could not furnish opinion.
74. On considering the evidence on record, the
allegation made against the accused No.1 who is the
Manager of the UCO Bank at Davanagere Branch, who is said
to be conspired with the accused Nos.2 to 9 has created the
documents. The accused No.1 sanctioned the loan to the
accused Nos.2 to 9 without following the guidelines, even
though he do not have power to sanction the huge loan.
75. Before going to appreciation of the evidence, it is
worth to mention some of the admitted facts in this case as
under:-
i. It is not in dispute that the accused No.1 - Shiva Kumar
was the Branch Manager of UCO Bank at Davanagere.
ii. It is also not in dispute that the accused Nos.2 to 8
have filed loan applications for grant of Megha Cash
Loan and Agricultural Loan.
iii. It is also not in dispute that the accused Nos.2 to 8
have filed the quotations for the purpose of purchasing
the agricultural equipments along with the valuation
report of the agricultural land which were furnished for
the purpose of the security for the loan.
iv. It is also not in dispute that the accused No.1 after
receipt of the loan applications forwarded the
applications to PW.5 - Keshavan, panel advocate for
legal opinion and he has furnished the legal opinion
based upon the legal opinion, the loans were
sanctioned.
v. It is also an admitted fact that the loans were disbursed
to the accused persons to their loan account opened by
them in the UCO Bank and they have withdrawal the
loans by producing the withdrawal slips and cheques.
vi. It is also not in dispute that subsequently the said loans
were repaid by the borrowers to the Bank.
76. Now, the allegation against the accused Nos.2 to
9 are that they have produced the fabricated documents and
fake documents for the purpose of borrowing loan, which was
not properly verified by the accused No.1 and sanctioned the
loan.
77. The learned counsel for the accused mainly
challenged the judgment on the ground that:-
i. No sanction was obtained under Section 19 of the P.C.
Act, while filing the charge-sheet,
ii. There is no evidence or documents to show that the
accused No.1 conspired with the accused persons while
sanctioning the loans,
iii. The author of the complaint or FIR is one S.P. Biju
George, was not examined and mere marking the FIR
through Investigating Officer cannot be accepted.
iv. The report of the PW.13 shows that he has inspected
the office and verified the documents. Thereafter, given
the report but the said report is not produced and
marked before the Court.
v. Admitted and disputed signatures were not separately
sent for getting expert opinion. Therefore, the opinion
of the PW.16 is not conclusive and not reliable to prove
the charges under Sections 120 (B), 468, 471 and 477
(A) of IPC.
vi. The guidelines issued by the RBI regarding following
the procedure by the Bank while sanctioning the loan
and the guidelines stating that no agricultural land shall
be taken as security for the loan has not been produced
and marked.
vii. The loans were sanctioned purely based upon the
documents verification and opinion given by the panel
advocate of the Bank - PW.5 - Keshavan.
viii. Further, contended that the Trial Court accepted the
evidence of the prosecution witnesses and it is only
stated in the chief examination, but not considered the
cross-examination.
78. On verifying the ground No.1 regarding sanction
under Section 19 of the P.C. Act, it is argued by the
respondent's counsel that at the time of filing the charge-
sheet the accused No.1 was already dismissed from the
service. Therefore, the sanction is not required. The
investigating officer - PW.15 has also stated the same.
79. On the other hand, the learned counsel for the
appellants relied upon the judgment of this Court in the case
of State of Karnataka vs V. Chandrashekhar, reported in
2022 (3) KCCR 2257. The learned counsel for the
respondent has contended that for the purpose of filing the
charge-sheet under the IPC cases, no sanction under Section
197 of Cr.P.C. is required. In support of his contention the
learned counsel for the respondent relied upon the judgment
of the Hon'ble Supreme Court reported in (1999) 5 SCC
690 in the case of State of Kerala vs. V. Padmanabhan
Nair.
80. On perusal of the judgment of the Hon'ble
Supreme Court in the case of V. Padmanabhan (Supra),
the Hon'ble Supreme Court held that when the offence
committed by a government servant, if it is punishable under
Sections 409 and 406 of IPC, for criminal breach of trust, the
misappropriation of fund and conspiracy for the offence
punishable under Section 120 (B) of IPC, the sanction under
Section 197 of Cr.P.C. is not necessary. It is also held that
under the prevention of Corruption Act 1947, when the
accused seized to a public servant on the date of taking
cognizance of offence under the P.C. Act, the sanction is not
necessary.
81. On the other hand, the learned counsel for the
appellant relied upon the judgment of the Coordinate Bench
of this Court in the case of V. Chandrashekhara (supra)
wherein the Coordinate Bench has held that the amendment
to the Prevention of Corruption Act in the year 2018, the
sanction under Section 19 of P.C. Act, has been inserted by
removing the earlier provision. Therefore, the amendment by
insertion of Section 19 of P.C. Act, is came into force from
the inception of the Act, from the year 1956. Enactment of
the law and the Coordinate Bench placing reliance of the
judgment of the Division Bench of this Court in the case of
Pusphalata N.V. vs. P. Padma and others, reported in
2010 KAR 1484, has held that the Section 19 of the P.C.
Act, has been inserted by deleting the earlier provision which
among to the enactment of Section 19 of P.C. Act, enactment
of the statute and Section 19 is given retrospective effect, at
Para No.15 has held as under:-
"Thus seen, it may be stated that the
amendment brought to Section 19 of the
Prevention of Corruption Act by Act No.16 of
2018 is to be understood as if it came into effect
from the date the Prevention of Corruption Act
was first given into effect i.e., from 09.09.1988.
This being the change in law, definitely the
respondent can contend that be cannot be
prosecuted without sanction and his retirement
from service does not make any difference in the
matter of obtaining sanction. Therefore, the
argument of Sri. B. S. Prasad cannot be
accepted. I do not find any infirmity in the
ultimate conclusion taken in the impugned order
to discharge the respondent. The revision
petition fails and it is dismissed."
82. The judgment of the Hon'ble Supreme Court is
based upon the unamended P.C. Act, 1947 and even
unamended P.C. Act, 1988 the sanction under Section 19 of
P.C. Act, is not necessary when a public servant seized to be
a public servant either by a dismissal or retirement by
superannuation or otherwise. Whereas, the amended Act,
2018, Section 19 of the P.C. Act, was inserted by deleting
the earlier provision where the sanction is necessary.
However, in the present case, the offence was committed
and FIR was registered in the year 2005 and judgment was
delivered by the Trial Court was on 05.07.2011, this appeal
is also filed in the year 2011. Therefore, once the police
already filed charge-sheet under unamended Act of P.C. Act,
at that time Section 19 of P. C. Act, is in force and there was
no sanction is necessary under Section 19 of the P.C. Act,
and Section 197 of Cr.P.C. was also not necessary when the
alleged offences have committed under the IPC Sections 406,
409 and 120 (B) of IPC. Therefore, while filing the charge-
sheet in the year 2008 by the CBI, sanction was not
necessary where the Section 19 of P.C. Act, was in force.
Therefore, merely the pending appeal is nothing but
continuation of original proceedings, but the sanction was not
necessary at the time of filing charge-sheet under the P.C.
Act and IPC against the accused No.1. Therefore, the
contention of the learned counsel cannot be acceptable, that
sanction is necessary for taking cognizance.
83. The second contention of the learned counsel for
the appellants is that regarding criminal conspiracy under
Section 120 (B) of IPC was not proved.
84. On perusal of the entire evidence on record
including the evidence of Bank Officials, the PW.1 or PW.4
were all deposed before the Court including the Investigating
Officer. There is no evidence adduced to show that this
accused No.1 conspired with the accused Nos.2 to 9 while
granting the loan based upon any fabricated documents.
Neither oral evidence nor any written documents or positive
evidence adduced by the prosecution to show that any of the
day these accused persons were conspired with intention to
commit the offence either cheating or fabricating the
documents. On the other hand, the loan applications were
filed by accused Nos.2 to 7 independently in the Bank. It was
processed by the Bank Officials and finally the documents
were sent to the Manager - the accused No.1 and in turn the
accused No.1 referred the documents to the PW.5 panel
advocate of the Bank for legal opinion for sanction of loan.
Admittedly, as per the evidence of the PW.1, he has given
the opinion for granting the loan after verifying the
documents stating that the title were perfected and opinion
was given as per Exs.P.57, 58, 76 and 114. Based upon legal
opinion the loans were sanctioned. Therefore, absolutely
there is no evidence to show that there was conspiracy
between accused No.1 and other accused in sanctioning loan
by accused No.1 to the accused Nos.2 to 7. Therefore,
Section 120 (B) of IPC went unproved by the prosecution.
85. As regards to the third contention, the author of
the FIR one S.P. Biju George was not examined and the
complaint and FIR has been marked through the PW.15.
Therefore, it is contended that the very complaint itself is not
proved by the prosecution. Herein in this case admittedly,
the CW.19 the S.P. Biju George has not been examined and
no evidence adduced by the prosecution not able to secure
his presence and examining him as witness before the Court.
On the other hand, the PW.15 has stated that FIR has been
registered by the S.P. and he has been authorized to
investigate matter. Of course FIR is marked at Ex.P.161. The
contents of the FIR has been proved by the prosecution by
examining the PW.15. It is well settled that mere marking
the documents, is not a proof and when the accused were
disputed the case, it is necessary for the prosecution to
prove the FIR, which is base for investigation and filing the
charge-sheet. However, it is a Bank fraud case, where the
accused No.1 - Bank Manager is involved, based upon the
statement of the PW.1 and PW.4, the FIR was registered by
the one Biju George, S.P. and the FIR has been marked
through the PW.15 and he has spoken with the contents of
the FIR and this Investigating Officer is familiar with the
identification of signature of the S.P. Such being the case,
the question of contending the FIR was not proved, is not
sustainable. The FIR is necessary for setting the law into
motion for the purpose of investigation. Therefore, non-
examination of the S.P. is not fatal to the prosecution case.
86. As regards to the hand-writing opinion the PW.16
given evidence that he has received the documents from the
Investigating Officer in respect of questioned documents and
admitted documents with regard to specimen hand-writing as
per Exs.P.165 and 166. As regards to the sanctioning of the
loan by this accused No.1 in favour of accused Nos.2 to 7 are
not in dispute and if any documents produced by the
borrower for applying loan along with the loan application,
the manager cannot go into the genuinity of the documents
while granting the loan. It is his duty to refer the documents
to panel advocate for getting legal opinion. Accordingly, legal
opinion has been given by the PW.5 - Keshavan, thereafter
he has granted the loan. Therefore, question of creation of
document or production of fake documents or fabricated
documents by accused No.1 for offences punishable under
Sections 468, 471 and 477 (A) will not attract against
accused No.1, as this Court has already held that conspiracy
of Section 120 (B) of IPC is not proved by prosecution.
Therefore, offences alleged against accused No.1 in respect
of fabrication of documents or creation of fake documents or
cheating Bank would not attract against accused No.1. The
fabrication of documents done by other accused, not by this
accused No.1. Hence, he cannot be convicted for offence
punishable under Section 477(A) of IPC. Therefore, evidence
of PW.16 the expert opinion not useful to the prosecution
case to prove guilt of accused No.1. Therefore, accused No.1
cannot be convicted for above said offences.
87. The another contention taken by the appellant's
counsel is that the allegation against accused No.1 was that
he has violated guidelines issued by the RBI and he has
sanctioned the loan based upon the opinion of the panel
advocate PW.5. Admittedly, the PW.5 - Keshvan the panel
advocate has admitted in the evidence that he has given
opinion for sanctioning of loan after verifying the documents
referred by accused No.1 for legal opinion. Whether
agricultural land cannot be taken as security for the loan or
not any violation of guidelines or not, it has to be verified by
the PW.5 panel advocate while giving opinion. Admittedly,
the panel advocate given opinion in all the cases, after
verifying valuation report, land documents and agricultural or
non-agricultural, but he has given opinion as per Exs.P.57,
58, 76, 138 and also admitted in cross-examination that as
per Ex.P.77, PW.14 also admitted that the documents
produced by the borrower can be accepted for the purpose of
creating mortgage for loan as security.
88. That apart the guidelines of RBI is not produced
and not marked in order to show that accused No.1 has
violated the guidelines and sanctioned the loan. That apart
the loan was sanctioned by the accused No.1 based upon the
legal opinion of the panel advocate. Therefore, it cannot be
said that the accused No.1 intentionally or willfully violated
the conditions or guidelines while sanctioning the loan. The
prosecution utterly failed to prove the allegation made
against the accused No.1.
89. Apart from that there is no evidence on record to
show that the accused No.1 misused his official position as a
public servant colluded with the accused - borrowers and
created any documents for any illegal gratification.
Absolutely, there is no evidence collected to show that he
has sanctioned the loan for any pecuniary benefit. Therefore,
I hold that the prosecution has failed to prove any of the
charges leveled against the accused No.1 either under IPC or
under the Prevention of Corruption Act.
90. The Trial Court has not appreciated the evidence
of the prosecution witnesses and admissions made by the
PW.1, PW.4, PW.5 and the Investigating Officer-PW.15,
which are all in favour of the accused which goes against the
route of the prosecution case. The Trial Court simply based
upon the examination-in-chief of the prosecution witness
convicted the accused No.1 - appellant which is illegal and
perverse. Hence, this Court required to be interference in
respect of conviction and sentence passed against accused
No.1.
91. As regards the allegations made against the
accused Nos.2 to 8 that they have created the false
documents and obtained the loan. As I have already stated
above, the filing of applications for loan, sanctioning the
loan, disbursing the loan and receiving the loan, were all not
in dispute.
92. As regards to the accused No.2 - Siddaviraiah who
was one of the borrower. He has also borrowed the loan by
filing application before the accused No.1 and as per the
evidence of PW.4 the accused loan application is Ex.P.16 and
the accused No.4 offered surety as per Ex.P.17. The
statement of the accused No.2 is Ex.P.18 and process note
issued by the accused No.1 is Ex.P.19. The I.T. returns filed
by the accused No.2 is Exs.P.13 which was proved by the
prosecution as fake I.T. returns by examining the PWs.2 and
3 the Income Tax officials who have categorically stated that
no I.T. returns produced before the authority. As regards to
the borrowing the Megha Cash Loan, sanction of loan,
disbursing the loan, withdrawal of the loan amount, is not in
dispute. The accused Nos.2 and 4 borrower were guarantors
also filed fake documents and produced as genuine
documents by forging the seal and signature of the Income
Tax Officer, whereby prosecution is successful in proving the
guilt of the accused No.2.
93. The accused No.3 - Vanishree filed an application
for borrowing the loan along with the documents. The
accused No.4 - Rajashekhariah was the co-applicant. The
Ex.P.1 is the loan application of accused No.3. The Ex.P.2 is
the document produced by the accused No.3. Admittedly,
these documents referred to the panel advocate for opinion.
Accordingly, he has given opinion and loan were sanctioned.
Though, it was alleged that there is no legal opinion, but the
PW.5 has admitted that he has given legal opinion. Further
more, in the cross-examination, he has admitted that the
accused No.3 was the sole applicant and there is column for
putting signature by the accused No.4 as a guarantor. There
is positive evidence to show that accused No.3 has created
document for the purpose of borrowing the loan. However,
she has received the loan and disbursed the loan amount and
she has declared in Ex.P.51 and received Rs.10,00,000/- as
per Ex.P.52. The evidence of PW.4 where he has stated that
the accused No.3 produced the loan statement as per
Ex.P.39 and letter of guarantee is issued by PW.4 is at
Ex.P.2. The accused No.3 has also filed a valuation report
as per Ex.P.41. The I.T. returns filed by accused No.3 is as
per Ex.P.14 and Ex.P.43 is letter executed by accused No.3.
Letter of revival issued by accused No.3 is at Ex.P.44 and
valuation report of the accused No.4 who is a guarantor as
per Ex.P.48. Now, the allegation is that the Ex.P.14 the I.T.
returns produced by accused No.3 was fake one. In this
regard, PW.2 Mohd. Gouse the I.T. officer Ward No.3 at
Davanagere, has deposed that the CBI officials produced the
Ex.P.14 and request for verification where he has verified the
seal dated 05.07.2003 alleged to have been filed the I.T.
returns, which was on holiday and Ex.P.14 is in respect of
Ward No.2. According to his evidence the Ex.P.14 is I.T.
returns are fake documents and there is no original found in
the I.T. office. The evidence of the PWs.1, 2, 4 and PW.15
the Investigating Officer and PW.16 which clearly reveals
that the accused No.3 produced the I.T. returns as per
Ex.P.14 which is not a original I.T. returns, which was filed
before the Income Tax Authorities, but it was a created
document. Even the seal under acknowledgment and the
Ex.P.14 were all a bogus seal in order to show that the
accused No.3 filed the Income Tax before the Income Tax
Authorities. But these documents were produced before the
accused No.1 for seeking loan and the counsel for accused
No.3 has not led any evidence to show that any books of
account or any of the documents to show that she has
continuously filed any I.T. returns and the Ex.P.14 was
genuine document. Therefore, the prosecution able to
establish that the accused No.3 produced the fake
documents along with the loan application for sanctioning of
loan.
94. As regards to the accused No.4 who also
guarantor to the loan borrowed by accused No.3, he has also
borrower of the loan. His loan application is marked at
Ex.P.3. The accused No.5 was the co-applicant and the
accused No.5 offered the surety regarding agricultural land.
The valuation report of the accused No.4 is at Ex.P.48 and
the letter of guarantor issued by accused No.4 in favour of
the accused No.3 is at Ex.P.47. The letter of revival loan of
accused No.3 is Ex.P.44. The process note of accused No.3 is
at Ex.P.45. The letter of guarantee issued by accused No.4 is
Ex.P.2. These documents were verified by the PW.5 and
given opinion and later the loan has been sanctioned. There
is no complaint that the accused No.4 created any false
documents and produced as guanine for offering surety to
accused No.3 or borrowing the loan for himself, where the
accused No.5 offered the surety to him. Merely, the accused
No.4 not affixed his signature, that cannot be a ground to
show that he has committed any offence. The I.T. returns of
accused No.4 is marked at Ex.P.59, but there is no allegation
that accused No.4 also filed any bogus I.T. returns. On the
other hand, the Ex.P.14 was the I.T. returns of accused No.3
which was found bogus and fake one, where the accused
No.4 was guarantor. Hence, it cannot be said that the fake
documents are filed by the accused No.3.
95. As per the evidence of PWs.1 and 4, the accused
No.6 also borrowed the loan by filing Megha Cash Loan
Application as per Ex.P.6. The process note is at Ex.P.75. The
accused No.9 filed guarantor statement as per Ex.P.7 and the
panel advocate given opinion as per Ex.P.76. The accused
No.6 given valuation report as per Ex.P.77. The
memorandum patrician are at Exs.P.78 and 79. The loan
agreement of accused No.6 is at Ex.P.80. The letter of
confirmation of title deed is at Ex.P.81. The letter of
guarantee is at Ex.P.82, which was issued by accused No.9.
The valuation report is at Ex.P.83 and the accused No.6
received the loan amount by opening the account and
withdrawing the amount as per Exs.P.85 to 90. Ex.P.91 is the
statement of loan account. These documents were not in
dispute. The main allegation against accused No.5 is that he
has produced the invoice from the ESSKAY enterprises,
where it is alleged that this invoices obtained by ESSKAY
enterprises were all bogus one. To prove the same, the PW.7
- Mruthunjaya who is an accountant from ESSKAY
enterprises examined. He has identified the Exs.P.92 and 93
are the quotations, but they were not the bills. The Exs.P.106
and 107 are alleged bills said to be issued from the ESSKAY
enterprises, but they have stated it is not the bills issued by
their company and no goods were supplied and they have
not received any money from the said borrowers.
96. On perusal of the evidence of PWs.1, 4 and 6 and
PW.15 - Investigating Officer evidence, it shows that the
accused No.4 borrowed the loan for the purpose of purchase
of agricultural equipments by producing the quotations as
per Exs.P.92 and 93, but the bills invoices produced obtained
from ESSKAY enterprises were a fake documents. The loans
were granted for the purpose of purchasing the agricultural
equipments and the quotations and invoices produced by the
accused No.5, the quotations were found guanine, but the
invoices were fake documents. Thereby the accused No.5
produced the fake documents for borrowing the loan, where
the accused No.6 offered surety.
97. As regards to the loan borrowed by the accused
Nos.7 and 8, by filing loan application at Ex.P.9 where the
accused No.6 offered surety and statement of guarantor is
Ex.P.10. The accused Nos.7 and 8 produced two invoices as
per Ex.P.99 and 100, obtained from Vanishree Industries.
The accused Nos.7 and 8 also furnished the letter of
confirmation as per Ex.P.101 and letter of guarantee of
accused No.6 is at Ex.P.102. The hypothecation agreement is
at Ex.P.103, where the accused No.1 attested as per
Ex.P.104. Another loan application of accused Nos.7 and 8 is
at Ex.P.11, where statement of guarantor issued by accused
No.6 is at Ex.P.12. The accused Nos.7 and 8 are also
produced the invoices as per Ex.P.105 to 109 obtained from
Krishna Engineering Company and invoices from COTMAC
Private Limited. Whereas allegation that invoices obtained
from Krishna Engineering Company and COTMAC Private
Limited were false documents as like invoice of ESSKAY
enterprises.
98. To prove the same, the prosecution examined
PW.8 - Chandrashekhar who is a businessman of Vani Agro
Industries dealing with Tractor and Trailer and the PW.9
Shivaraj Manager of COTMAC Private Limited both have
stated that though they have obtained the quotations as
Ex.P.100 and the Ex.P.106, but the same was not issued by
them. The Ex.P.106 is also not issued by them. But these
documents were created in the names of Vani Agro
Industries and COTMAC Private Limited for the purpose of
borrowing the loan by accused Nos.7 and 8.
99. The PW.9 - Shivaraj the Assistant Manager also
deposes that Ex.P.106 is the quotation issued in the name of
their company, but it was not issued by them. Though, he
has stated that whether he cannot say who has created this
document, but the Ex.P.106 is not issued himself or his
company, which means this document is created by the
accused for the purpose of obtaining the loan.
100. PW.10 - Umesh another businessman from
Krishna Engineering Company also deposes that Ex.P.105 is
a printed quotation and it was not issued by his company.
Evidence of PWs.6 to 10 reveals that accused persons
created invoices/bills, quotations in the names of ESSKAY
enterprises, ESSKAY Pipe, Vani Agro Industries, in order to
show that COTMAC Private Limited and Krishna Engineering
Company, wants to purchase agricultural equipment they
have raised the loan, but documents are all false documents
which is proved by prosecution from evidence of PWs.6 to
10. Evidence of PW.16 hand writing expert was given opinion
that accused persons were created documents and placed
before Bank for borrowing loan. Accused persons also filed
Exs.P.13 and 14 which are I.T. returns also bogus and
Exs.P.13, 14 and 15 are I.T. returns which are not at all filed
before income tax, but they have acknowledged by creating
and affixing false signature and seal of Income Tax Authority
which is evident from evidence of PWs.2 and 3 the Income
Tax Officials.
101. Though, the accused No.9 is said to scribe of the
loan application and also offered surety to one of the
accused, but he has not signed the guarantor application.
However, the accused No.1 granted loan. Of course it is duty
of by accused No.1 without proper verification sanctioned the
loan. But the legal opinion was given by the PW.5 without
proper verification. Therefore, the accused No.1 sanctioned
the loan.
102. It is seen from the evidence of the PWs.1 to 4, 6
to 10 and 11 to 16 that the prosecution has successful in
proving that the accused Nos.2 to 8 have created the false
documents including the I.T. returns and invoice bills in the
name of various companies in the name of purchasing the
agricultural equipments and obtained the loan. Thereby, the
accused Nos.2 to 8 have produced the fake and forged
documents as guanine before the Bank for the purpose of
obtaining the loan and also they have received the loan and
thereby they cheated the UCO Bank. Thereby, the accused
Nos.2 to 8 have committed the offences punishable under
Sections 468, 471, 477 (a) and 420 of IPC.
103. However, this Court has already held that the
accused No.1 have received the application from the accused
Nos.2 to 8 and referred to the PW.5 - panel advocate and
obtained the opinion and sanctioned the loan. Later the loans
were disbursed to accused Nos.2 to 8 and accused No.9,
though scribe of the loan applications, but he has not signed.
Therefore, the accused Nos.1 and 9 are not found guilty for
any of the offences charged against them.
104. On the other hand, the prosecution is successful
in proving the charges against accused Nos.2 to 8. Though,
the accused persons subsequently repaid the loan and there
is no loss cause to the Bank, but the amounts were paid by
the accused persons only after registering the FIR and during
the pendency of the trial. Therefore, merely the repayment
made by the accused Nos.2 to 8 cannot be exonerated from
charges of creating the documents or fabricating the
documents by producing before the authority as genuine and
thereby they already cheated the Bank.
105. Though, the complainant Superintendent of Police
is not examined by the prosecution, but the PW.15 who is a
Investigating Officer appointed by the S.P. The FIR has been
marked by the prosecution which is sue-moto complaint by
the CBI. Therefore, the FIR is only for the purpose of setting
law into motion in a criminal case. Therefore, the FIR is
proved by the prosecution by examining the PW.15 and
merely non-examination of the S.P. who registered the
complaint will not fatal to the case of the prosecution. As per
the judgment of the Hon'ble Supreme Court in the case
Anilkumar vs. State of U.P. reported (2003) 3 SCC 569
at Para No.7 the Hon'ble Supreme held that the non-
examination of the scribe of FIR is not fatal. Herein in this
case S.P. is a scribe of the FIR. Therefore, the non-
examination of the S.P. is not fatal to the case of the
prosecution.
106. As regards to the contention of the counsel for the
appellants - borrowers is that they already settled the
amount there is no wrongful loss. Therefore, no offences is
committed. In this regard, the learned counsel for the
respondents relied upon the judgment of the Supreme Court
in the case of CBI vs. Harisingh Ranaka and others
reported in (2019) 16 SCC 687, wherein the Hon'ble
Supreme Court has held that the loan obtained from the
Bank by fraud and offences under Sections 420, 467, 468,
471, 120(B) IPC were registered. Subsequently, entered into
one time settlement with Bank was not enough to cause the
proceedings or discharge the accused. In view of the serious
allegations made with regard to de-frauding and cheating
committed with help of forged documents. Here in this case,
subsequent to the registration of the FIR, the accused return
the loan, but by the time the accused were already obtained
loan by filing the fabricated documents and committed the
fraud. Thereby cheated the Bank. Subsequent to the
settlement or repayment will have no impact on the offence
registered against the accused in the criminal case. Of course
there may be no loss cause to the Bank, but there was
already wrongful gain made by the accused persons by
receiving the loan. Therefore, the contention of the learned
counsel for the accused persons is not sustainable under the
law.
107. In view of the above findings, the appellant -
accused No.1 in Crl.A.No.780/2011 is entitled for acquittal.
108. The appellant - accused No.5 in
Crl.A.No.812/2011 died during the pendency of the appeal.
Hence, the appeal abates.
109. The appellant No.1 in Crl.A.No.967/2011 who is
accused No.7 also died during the pendency of the appeal.
Hence, the appeal abates.
110. The appeal filed by the appellant - accused No.2
in Crl.A.No.813/2011, the appeal filed by the appellant -
accused No.3 in Crl.A.No.815/2011, the appeal filed by the
appellant No.2 - accused No.8 in Crl.A.No.967/2011 are
liable to be dismissed.
111. The appeal filed by the appellant - accused No.9
in Crl.A.No.792/2011 is deserved to be allowed. Accordingly,
I proceed to pass the following;
ORDER
i. The Crl.A.No.780/2011 filed by appellant - accused
No.1 and Crl.A.No.792/2011 filed by appellant -
accused No.9 are allowed.
ii. The judgment of conviction and sentence passed
against accused Nos.1 and 9 by the Spl. Court is hereby
set-aside. They are acquitted for the charges leveled
against them and the bail bonds stand cancelled. If any
fine amount paid by them is ordered to be refunded to
them.
iii. The Crl.A.No.813/2011 filed by appellant - accused
No.2, the Crl.A.No.814/2011 filed by the appellant -
accused No.6, Crl.A.No.815/2011 filed by appellant -
accused No.3 and Crl.A.No.967/2011 filed by appellant
No.2 - accused No.8, are hereby dismissed.
iv. The Crl.A.No.812/2011 filed by appellant - accused
No.5 and Crl.A.No.967/2011 filed by the appellant No.1
- accused No.7 are died during the pendency of the
appeals. Hence, the appeals filed by the accused Nos.5
and 7 are hereby dismissed as abated.
v. Send the copy of the judgment and records to the
concerned Court.
Sd/-
JUDGE
KJJ
