S.Pradeep Kumar vs State Of Kerala
2021 Latest Caselaw 2344 Ker

          IN THE HIGH COURT OF KERALA AT ERNAKULAM

                           PRESENT

      THE HONOURABLE MR. JUSTICE R. NARAYANA PISHARADI

  THURSDAY, THE 21ST DAY OF JANUARY 2021 / 1ST MAGHA, 1942

                 Crl.Rev.Pet.No.1381 OF 2019

    AGAINST THE ORDER DATED 02.03.2019 IN CC 15/2013 OF
      ENQUIRY COMMISSIONER & SPECIAL JUDGE,TRIVANDRUM


REVISION PETITIONER/2ND ACCUSED:

            S.PRADEEP KUMAR
            AGED 54 YEARS
            KAYANADU VILA VEEDU, KARIMPINPUZHA P.O,
            THAZHAM, PUTHOOR, KOLLAM.

            BY ADVS.
            SRI.PAUL JACOB (P)
            SRI.ENOCH DAVID SIMON JOEL
            SRI.RONY JOSE
            SRI.GEORGE A.CHERIAN
            SRI.LEO LUKOSE
            SMT.SUZANNE KURIAN
            SHRI.AMAL AMIR ALI

RESPONDENT/COMPLAINANT:

            STATE OF KERALA
            REPRESENTED BY PUBLIC PROSECUTOR , HIGH COURT
            OF KERALA , ERNAKULAM.

            R1 BY GOVERNMENT PLEADER

OTHER PRESENT:

            SRI A RAJESH SPL PP VACB

     THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY
HEARD ON 07.01.2021, THE COURT ON 21.01.2021 PASSED THE
FOLLOWING:
 Crl.R.P.No.1381/2019
                                       2



                      R.NARAYANA PISHARADI, J
                      ************************
                        Crl.R.P.No.1381 of 2019
              -----------------------------------------------
               Dated this the 21st day of January, 2021

                                  ORDER

The revision petitioner is the second accused in the case

C.C.No.15/2013 pending in the Court of the Enquiry

Commissioner & Special Judge, Thiruvananthapuram.

2. The offences alleged against the accused in the case

are under Section 13(1)(d) read with Section 13(2) of the

Prevention of Corruption Act, 1988 and under Sections 420, 468

and 471 read with 34 IPC and under Section 120B IPC.

3. The first accused was the Branch Manager of the

Kerala State Co-operative Bank, Medical College Branch,

Thiruvananthapuram (for short 'the Bank') during the period from

1.9.2004 to 25.2.2006. The prosecution case relates to a

transaction in which an amount of twentyfive lakhs rupees was

granted to the second accused as loan from the Bank.

4. The prosecution case against the accused, as stated in Crl.R.P.No.1381/2019

the final report filed by the Dy.S.P., Vigilance and Anti-Corruption

Bureau (VACB), is as follows:

" That A-1 being the Branch Manager of Kerala State Co-operative bank, Medical College Branch, Thiruvananthapuram from 01.09.2004 to 25.02.2006 and as such being a public servant entrusted with the day to day transactions, proper maintenance and upkeeping of records ensuring safety and security of valuables, property and the funds of the Bank to protect the best interest of the bank etc. made criminal conspiracy with A-2 and in furtherance of the said conspiracy hatched between A-1 and A-2, A-1 by abusing his official position flouted all norms and guidelines and with their common intention to cheat and cause wrongful loss to the Bank, A-1 introduced A-2 for opening a current account in the Bank and thereafter obtained an ingenuine term loan application of Rs.25 lakhs from A-2 which was supported by false and forged documents such as lease agreement, invoice and vouchers and A-1 without conducting any verification and by suppressing material facts with the connivance of A-2, A-1 recommended the loan application to the head office for obtaining loan for A-2 while the loan application was under process, A-1 sanctioned a mortgage loan to the tune of Rs.10 lakhs, so as to facilitate A-2 to obtain the said mortgage Crl.R.P.No.1381/2019

loan by using the same collateral security offered by A-2 for his term loan and disbursed the mortgage loan of Rs.10 lakhs to A-2 on 10.06.2005 and thereafter the term loan was sanctioned by the executive committee. A-1 disbursed the loan amount to A-2 by flouting all norms and thereby A-1 caused undue pecuniary advantage to A-2 and the Bank sustained a loss of Rs.25 lakhs towards the disbursal of the said loan amount to A-2 and hence A-1 and A-2 committed the offences punishable under the above provisions of law."

5. The second accused has filed this revision petition

challenging the charges framed against him by the Special Court.

6. Heard the learned counsel for the petitioner and the

learned Public Prosecutor.

7. The main grounds stated in the revision petition, in

challenging the charges framed against the petitioner by the trial

court, are the following: (1) There are no sufficient materials

produced by the prosecution to prove the charges levelled

against the petitioner. The Special Court did not apply its mind

to find out whether there was sufficient ground for proceeding

against the petitioner. (2) The nature of the allegations raised Crl.R.P.No.1381/2019

against the petitioner are purely civil in nature. (3) The materials

on record produced by the prosecution do not disclose the

commission of the offences alleged against the petitioner.

8. Learned counsel for the petitioner made submissions

before this Court elaborating the above mentioned grounds. The

sum and substance of the submissions is that the loan was

sanctioned to the petitioner by the Bank on the basis of the

security offered by him by creating equitable mortgage in respect

of his property and that the security so offered was sufficient

and proper. According to the learned counsel for the petitioner, it

was a pure and simple loan transaction and the loan amount was

disbursed to the petitioner after sanction obtained from the Head

Office of the Bank on verifying the entire documents produced by

him.

9. Per contra, learned Public Prosecutor has submitted

that the petitioner had produced false and fabricated documents

in the Bank for sanctioning the loan and the first accused had

made dishonest representation to the Head Office in

recommending the loan on the basis of such documents. Crl.R.P.No.1381/2019

Learned Public Prosecutor would submit that, commission of

the offence of conspiracy can very well be inferred from the

facts and circumstances of the loan transaction as revealed

from the materials produced by the prosecution.

10. At the outset, it is to be stated that the petitioner had

not filed any application for discharge before the trial court.

Learned counsel for the petitioner has fairly stated before this

Court that the petitioner had also not raised any plea of

discharge at the time of the hearing contemplated under Section

239 of the Code of Criminal Procedure, 1973 (for short 'the

Code').

11. The petitioner had submitted application to the Bank

for granting a loan of twentyfive lakhs rupees. The application

was made for granting term loan. There is no dispute with regard

to the fact that the first accused, while he was serving as the

Branch Manager of the Bank, disbursed an amount of ten lakh

rupees to the petitioner as loan. According to the prosecution,

he had disbursed the aforesaid amount to the petitioner while

the application and the other documents for sanctioning a loan Crl.R.P.No.1381/2019

of twenty five lakhs rupees had been submitted to the Head

Office of the Bank and while loan application was under the

consideration of the Head office. The balance amount was

disbursed to the petitioner after sanction was obtained from the

Head Office. The petitioner would contend that he had offered

sufficient security for the loan availed of by him from the Bank

by creating equitable mortgage in respect of his property and

there was nothing illegal or irregular in the loan transaction.

12. However, the learned Public Prosecutor has invited

the attention of this Court to the statements of certain witnesses

and also certain documents produced by the prosecution in

support of the contention that there was a conspiracy between

the first and the second accused to cheat and defraud the Bank

by using false and fabricated documents.

13. The witness E.G. Mohandas (CW2) was the Regional

Manager of the Bank. His statement reveals the following facts:

Application for a term loan shall be accompanied by a project

report. The Branch Manager of the Bank has to be satisfied

about the viability of the project. If the loan application is for Crl.R.P.No.1381/2019

starting any new business, the Manager has to inspect the site

and make a site visit report. The loan sanctioned by the Bank to

the petitioner was for starting a power laundry unit. When CW2

inspected the site in connection with the enquiry conducted by

him, what he could see there was a temporary asbestos shed and

two rusted machines and it was contrary to the details stated in

the loan application. There was no water connection or electricity

connection there. There was also no power laundry unit installed

there. The first accused had given a wrong site visit report to

recommend sanctioning of the loan to the petitioner. It was the

first accused who introduced the second accused to the Bank to

open the current account in the Bank. As per the rules, no

Bank staff shall not introduce a customer to open current

account in the Bank. The first accused disbursed ten lakhs rupees

to the petitioner while the loan application and other documents

were under processing by the Head Office.

14. The witness Padmanabhan Nair (CW4) was the Deputy

General Manager of the Bank. His statement reveals the

following facts. If the application for loan is for an amount Crl.R.P.No.1381/2019

above ten lakh rupees, the loan application and other documents

shall be forwarded to the Head Office for consideration along

with the recommendation of the Manager. When CW4 inspected

the project site in connection with the enquiry conducted by

him, he saw there only a shed made of tin sheets and one or

two rusted machinery. There was no electricity and water

connection there. The petitioner had submitted receipts and

invoices showing purchase of machinery from the establishment

by name Pentakon India (Systems and Solutions) Private Limited.

On verification, the sales tax registration numbers shown in

these documents were found to be false. The sale tax registration

number shown in these documents was in the name of an

establishment by name 'Comput Tech'.

15. The witness Vidhu (CW5) is the owner of the property

which was leased out to the petitioner for starting the power

laundry unit. His statement shows the following facts: He had

constructed a temporary shed in his property for starting a

poultry farm but he cannot start the business. There was no

number allotted to the shed by the local authority. There was Crl.R.P.No.1381/2019

also no water connection or electric connection to the shed. An

agreement was executed between him and the petitioner on

29.5.2003 by which he leased out the shed to the petitioner. The

lease agreement dated 15.4.2004 (which was produced by the

petitioner in the Bank) was not executed by him (CW5). He is

also not acquainted with the witnesses mentioned in that

agreement.

16. The witness Jayaraj (CW9) was the Deputy General

Manager in the Industrial Loan Department of the Bank. His

statement reveals that, after forwarding an application for

sanctioning a loan of above ten lakhs rupees to the Head Office,

the Branch Manager of the Bank has no authority to sanction and

disburse a loan of ten lakhs rupees on the same application.

17. The witness Muthukumar (CW10) was an Assistant

Engineer in the Kerala Water Authority. His statement reveals

that there was no water connection given in the name of the

power laundry unit allegedly conducted by the petitioner.

18. The witness Anitha.G. Nair (CW12) was the Assistant

Executive Engineer of the Electrical Sub Division, Crl.R.P.No.1381/2019

Kesavadasapuram, Pattom, Thiruvananthapuram. Her statement

reveals that there was no electric connection provided in the

name of the power laundry unit allegedly conducted by the

petitioner.

19. The witness S.Mohan (CW13) was the Commercial Tax

Officer, IIIrd Circle, Thiruvananthapuram. According to the

prosecution, the invoices and the receipts for purchase of

machinery produced by the petitioner were issued from

M/s.Pentakon India (Systems and Solutions) Private Ltd. The

statement of CW13 shows that no such establishment by name

M/s.Pentakon India (Systems and Solutions) had been registered

in the IIIrd Circle of the Sales Tax Office, Thiruvananthapuram.

20. The witness K.R.Satheesh (CW18) was the owner of

the establishment by name 'Computech Systems'. His statement

reveals that the sales tax registration numbers shown in the

receipts and invoices produced by the petitioner in the Bank had

been issued in the name of the establishment conducted by him

(CW18). His statement also reveals that he had not conducted

any establishment by name M/s.Pentakon India (Systems and Crl.R.P.No.1381/2019

Solutions) Private Limited.

21. The facts emerging from the statements of the

aforesaid witnesses are, prima facie, sufficient to establish the

case against the petitioner for the offences alleged against him.

The statements of the aforesaid witnesses would, prima facie,

reveal that the petitioner had produced false and fabricated

documents in the Bank for the purpose of obtaining loan from the

Bank. In such circumstances, the contention of the learned

counsel for the petitioner that it was a pure and simple loan

transaction cannot be accepted at this stage. The materials

produced by the prosecution are sufficient to establish a prima

facie case against the petitioner. The conspiracy hatched between

the petitioner and the first accused can be inferred from the

conduct of the first accused in recommending the loan on the

basis of the false and fabricated documents produced by the

petitioner and also in granting an amount of ten lakhs rupees to

the petitioner as loan while the loan application and the other

documents were under processing by the Head Office of the

Bank.

Crl.R.P.No.1381/2019

22. No doubt, as contended by the learned counsel for the

petitioner, framing of charge is the first major step in a criminal

trial where the Court is expected to apply its mind to the entire

record and documents placed therewith before the Court.

Framing of charge is a major event where the Court considers

the possibility of discharging the accused of the offence with

which he is charged or requiring the accused to face trial. In a

case where, upon considering the record of the case and

documents submitted before it, the Court finds that no offence is

made out or there is a legal bar to such prosecution under the

provisions of the Code or any other law for the time being in

force and there exists no ground to proceed against the accused,

the Court may discharge the accused. There can be cases where

such record reveals the matter to be so predominantly of a civil

nature that it neither leaves any scope for an element of

criminality nor does it satisfy the ingredients of a criminal offence

with which the accused is charged. In such cases, the Court may

discharge the accused or quash the proceedings against him.

(See C.B.I v. Dr. Anup Kumar Srivastava : AIR 2017 SC Crl.R.P.No.1381/2019

3698).

23. However, it is a settled principle of law that at the

stage of considering an application for discharge the court must

proceed on the assumption that the material which has been

brought on the record by the prosecution is true and evaluate the

material in order to determine whether the facts emerging from

the material, taken on their face value, disclose the existence of

the ingredients necessary to constitute the offence (See State v.

Hiremath : AIR 2019 SC 2377).

24. In the instant case, the petitioner had not filed any

application for discharge. He had also not advanced any plea

before the trial court that the materials produced by the

prosecution are not sufficient to establish a prima facie case

against him. In such circumstances, the trial court had no

necessity or occasion to pass a speaking order before framing the

charge against the accused in the case.

25. If the trial court decides to frame a charge, there is no

legal requirement that it shall pass an order specifying the

reasons as to why it opts to do so. Framing of charge itself is Crl.R.P.No.1381/2019

prima facie order that the trial court has formed the opinion,

upon considering the police report and other documents and after

hearing both sides, that there is ground for presuming that the

accused has committed the offence concerned (See Kanti

Bhadra Shah v. State of West Bengal : AIR 2000 SC 522).

26. The contention of the petitioner that the facts of the

case implicate him to answer only a civil liablity is without any

basis. Where allegations give rise to a civil claim and also amount

to an offence, merely because a civil claim is maintainable, it

does not mean that a criminal prosecution is not maintainable. At

this juncture, it is advantageous to quote the observations made

by the Apex Court in State of Madya Pradesh v. Rameshwar :

(2009) 11 SCC 424, which read as follows:

"The judgments referred to by Mr.Tankha regarding the tendency to convert civil disputes into criminal cases to pressurise the accused are unimpeachable, but the same will not apply to the facts of this case where a conspiracy to cheat the Bank is alleged."

27. The trial court is not expected to hold a roving inquiry

into the pros and cons of the case at the stage of framing Crl.R.P.No.1381/2019

charges by weighing the evidence as if it is conducting the trial.

The court is not expected to go deep into the probative value of

the material on record.

28. Offence of criminal conspiracy has its foundation in an

agreement to commit an offence. The most important ingredient

of the offence of criminal conspiracy is the agreement between

two or more persons to do an illegal act or an act not illegal by

illegal means. For an offence punishable under Section 120-B

IPC, the prosecution need not necessarily prove that the

perpetrators expressly agreed to do or cause to be done an

illegal act; the agreement may be proved by necessary

implication.

29. Dealing with exercise of revisional jurisdiction of the

High Court in interfering at the stage of framing the charges, in

Om Wati v. Delhi Administration (AIR 2001 SC 1507), the

Apex Court has held as follows:

"Self restraint on the part of the High Court should be the rule unless there is a glaring injustice staring the court in the face. The opinion on many matters can differ depending upon the person who views it.

Crl.R.P.No.1381/2019

There may be as many opinions on a particular point, as there are courts but that would not justify the High Court to interdict the trial. Generally, it would be appropriate for the High Court to allow the trial to proceed".

30. True, the charge framed by the trial court against the

accused in the case lacks clarity. But, it is not a sufficient ground

to set aside the charge. In view of the provision contained in

Section 464 of the Code, the question whether on account of any

error, omission or irregularity in framing charge, failure of justice

has been occasioned or not, is a matter to be decided after the

trial of the case.

31. In the aforesaid circumstances, I find no sufficient

ground to set aside the charges framed against the petitioner by

the Special Court. The revision petition is liable to be dismissed.

Consequently, the revision petition is dismissed.

Sd/-

R. NARAYANA PISHARADI JUDGE al/-lsn.

Crl.R.P.No.1381/2019

APPENDIX PETITIONER'S/S EXHIBITS:

ANNEXURE A1 A TRUE COPY OF THE AGREEMENT EVIDENCING CREATION OF AN EQUITABLE MORTGAGE, DATED 06.06.2005 EXECUTED BY THE PETITIONER.

ANNEXURE A2 A TRUE COPY OF THE LOAN AGREEMENT DATED 07.07.2005 EXECUTED BY THE PETITIONER.

ANNEXURE A3 A TRUE COPY OF THE STATEMENT OF ACCOUNT OF THE PETITIONER FOR THE PERIOD FROM 01.01.2004 TO 14.05.2013 ISSUED BY THE KERALA STATE CO-OPERATIVE BANK, MEDICAL COLLEGE BRANCH, THIRUVANANTHAPURAM.

ANNEXURE A4 A TRUE COPY OF THE CERTIFICATE NUMBERED AS NO.XXV/5/2005 AND DATED 12.05.2005 ISSUED BY THE APPROVED VALUER.

ANNEXURE A5 A TRUE COPY OF THE POSSESSION NOTICE DATED 03.09.2007 ISSUED UNDER RULE 8(1) OF THE SARFAESI RULES, 2002.

ANNEXURE A6 A TRUE COPY OF THE FINAL REPORT DATED 23.11.2013 IN C.C NO.15/2013 ON THE COURT OF ENQUIRY SPECIAL COMMISSIONER AND SPECIAL JUDGE (VIGILANCE), THIRUVANANTHAPURAM.

RESPONDENTS EXHIBITS : NIL

TRUE COPY

P.S TO JUDGE

al/-