Ajit Kumar Sial & Others vs State Of Orissa & Others ....... ...
2025 Latest Caselaw 3946 Ori

Orissa High Court

Ajit Kumar Sial & Others vs State Of Orissa & Others ....... ... on 13 February, 2025

             THE HIGH COURT OF ORISSA AT CUTTACK

                               CRLMC No. 1490 of 2020
 (In the matter of an application under Section 482 of the Criminal Procedure Code, 1973)




Ajit Kumar Sial & others                       .......                    Petitioners

                                              -Versus-

State of Orissa & others                       .......              Opposite Parties


        For the Petitioners                : Mr. B. Panigrahi,
                                             Senior Advocate

        For the Opp. Party Nos.1 & 2
                                 : Mrs. Sarita Maharana,
                                  Additional Standing Counsel

        For the Opp. Party No.3 : Mr. Surya Kanta Dash, Advocate



CORAM:

     THE HONOURABLE SHRI JUSTICE SIBO SANKAR MISHRA



     Date of Hearing: 11.02.2025 Date of Judgment: 13.02.2025

S.S. Mishra, J.

1. The petitioners are aggrieved by the order dated 02.07.2020

passed by the learned S.D.J.M., Bhubaneswar directing the IIC, Khandagiri Police Station for registration of the F.I.R. under

Section 156(3) of the Cr. P.C. on the complaint by the opposite

party No.3 in 1CC Case No.2205 of 2020.

2. The allegation against the petitioners in the complaint leading

to the impugned direction is that, the complainant has requested to

the petitioners' bank known as Dena Bank (now known as Bank

of Baroda) to sanction a Term Loan of Rs.27,66,240/- for

expansion of her MSME unit and also to purchase a cement

manufacturing machine from a person, namely, Mahabir Prasad

Mali of Ajmer, Rajasthan. The allegation against these petitioners

is that, they have connived with the said person, namely, Mahabir

Prasad Mali, and credited the whole loan amount in his favour.

The said Mahabir Prasad Mali cheated the complainant by not

supplying the cement manufacturing machine after receipt of the

amount from the bank. Further, it was alleged that the petitioners

work as an agent of the above named person and neglected their

duty. It was also alleged that the petitioners cheated the

complainant and her husband and pressurized to lift the machine

and also cheated to bank by jeopardizing public money. The loan

account became Non-Performing Asset (NPA). The petitioners

had well planned conspiracy in connivance with the agent of the

accused which resulted the complainant to suffer from several

diseases.

3. The learned trial Court passed the impugned order taking the

cognizance on the aforementioned allegation and directed for

registration of the case under Section 156(3) of the Cr. P.C. All

the petitioners are the bank officials. Following sequence of event

are enumerated for better appreciation of the facts of the case.

 01.05.2017:-The opposite party No.3/the complainant being

the sole proprietor of Mahodadhi Cement

Products, approached the then Dena Bank for

loan against the cash credit term loan for

setting up her business.

 13.06.2017:-The Dena Bank (now the Bank of Baroda)

sanctioned cash credit of Rs.150.00 lakhs in

favour of the complainant.

 25.07.2017:-The complainant, in writing, requested the

bank to disburse Rs.27,66,240/- in favour of

the manufacturer of Fly Ash Machine namely,

M/s. LPM Engineering Private Limited at

Ajmer.

 06.09.2017:- The complainant also furnished an affidavit in

favour of the bank acknowledging the

transaction and disbursement of the money to

M/s. LPM Engineering Private Limited. The

opposite party had undertaken to indemnify

through the said affidavit.

 07.08.2018:- Despite Rs.27,66,240/-, i.e. full amount

towards the purchase of the machineries was

disbursed to M/s. LPM Engineering Private

Limited. The machineries were not delivered

to the opposite party. Therefore, the

complaint has been filed by the opposite party

leading to the registration of the F.I.R. in

connection with Khandagiri P.S. Case No.343

of 2018 for the alleged commission of the

offences punishable under Sections 420/ 405/

409/120-B/34 of the IPC.

 06.03.2019:-The bank classified the loan account of the

opposite party No.3 as NPA account and

proceeded under the SARFAESI Act.

 10.01.2020:-The Directors of M/s. LPM Engineering

Private Limited were arrested. The accused

persons, being arrested, have confessed to

their crime and deposited the entire amount

disbursed to them i.e. Rs.27,66,240/- along

with interest of Rs.7,33,760/- with the bank.

The bank appears to have adjusted the amount

towards the loan default account of the

opposite party No.3.

 26.06.2020:- The opposite party No.3 confronted with the

proceeding initiated by the bank under the

SARFAESI Act and the fact that the amount

recovered from M/s. LPM Engineering

Private Limited has been adjusted in the

default account, filed a private complaint

against the bank officials.

 29.09.2020:- The opposite party initiated 1CC Case

No.2205 of 2020 against all the bank

officials. Relevant would be to reproduce the

precise allegation made by the opposite

parties against the petitioners bank officials in

the complaint, which reads thus:

"3. That, the complainant lodged a FIR in the Khandagiri P.S. In response of Complainant FIR, the case registered vide FIR No. 0343 Dated 07.08.2018 U/s. 420, 405, 409, 120-, 34 of IPC where the Odisha Police arrested the culprit from Ajmer, Rajasthan 10.01.2020 under the supervision of IIC, Khandagiri. The Hon'ble CJM, Ajmer issued transit remand on 13.01.2020 and Hon'ble SDJM, Bhubaneswar rejected the bail appeals and forwarded to custody for 21 days. During this period the accused confessed the crime before police and deposited money of Rs.27,66,240/- (Rupees Twenty Seven Lakh Sixty six thousand two hundred forty only) with interest of Rs.7,33,760/- (Rupees Seven lakh thirty three thousand seven hundred sixty) in the bank loan account of Complainant.

4. That, the bank officers who were covering the accused satisfying their personal gain, has tortured physically and mentally, a lady entrepreneur, aged about 58 years now undergoing treatment for ovary cancer. These unethical of Bank officers association with prime accused should come under investigation which has been proved by the acknowledgement of crime and deposit of embezzled fund. The above accused at the behest of the agent of L.P.M. Engineering Pvt. Ltd., Ajmer, Rajasthan transferred the whole money through RTGS from Dena Bank, to Ajmer Branch on dt. 29.07.2017 after availing their personal gain and by this way they are neglecting their duty for which they are paid. Cheated the complainant by pressuring to lift the machine, when there was no machine, cheated the bank jeoparding the public money for which the loan converted to Nonperformance Asset (NPA) for their individual gain. Consideration of gain and delinquency of duty better known to all the accused persons will be come to lime light if the investigation will be done by the police personnel.

For the above act the complainant more axed pressure day by day which leads to her suffering from mental tension acute diabetics, lastly she suffered from cancer and psychological disorder, not only that the above accused in exercise at their common intention to conceal their evil deed, always put pressure by Recovery Squad raided the complainant residence with plant which created much more mental agony to the complainant.

5. That, the undersigned has lodged a FIR on dated 09.05.2020 by registered post due to cancer treatment and lockdown. The FIR lodged against these four officers of Dena Bank now known as Bank of Baroda in the office of the IIC, Khanagiri P.S. is pending and not being registered.

6. That, the above facts make it abundantly clear that the above named accused persons intentionally and purposefully with an ulterior motive and design cheated the complainant by making unlawfully payment to the main accused i.e. Mahabir Prasad Mali the Director of M/s. LPM Engineering Pvt. Ltd., Ajmer, Rajasthan along with other Directors by which act of

these accused the complainant suffered a lot for recovering of the unlawfully payment of Rs.27,66,240/- and she has to run from pillar to post for get back of these amount. Hence from the above mischievous act on part of these accused persons as a whole make it clear that in order to fulfill their personal gain, the accused persons join hands with the main culprit tried to cheat the complainant for which they are liable to penalize for their malafide intention being public servant and utilizing common man's money. The complainant being a lady harassed intentionally by these accused has no other option she to approached this Hon'ble Court for relief as per the provision of law as the local police refused to take action against these accused person in spite of proper complain has been made before them."

 02.07.2020:-The learned S.D.J.M. directed the IIC,

Khandagiri Police Station to register and

investigate the offences alleged to have been

committed by the petitioners under Section

156(3) of the Cr. P.C. The petitioners are

aggrieved by the same. Hence, this petition.

4. Mr. Panigrahi, learned counsel for the petitioners has taken

me to the documents placed on record and submitted that the only

allegation made against the bank by the complainant is that,

without the intimation by the complainant, the bank has disbursed

the entire amount to M/s. LPM Engineering Private Limited. That

precisely is the cause of initiation of the criminal prosecution

against the bank officials.

5. To negate the said allegation, learned counsel for the

petitioners relied upon the letter dated 25.07.2017 issued by the

opposite party No.3 to the bank. In the said letter, the opposite

party No.3 had requested the bank to disburse the entire amount to

M/s. LPM Engineering Private Limited. Relevant would be to

reproduce the said letter dated 25.07.2017:

"To The Asst. General Manager Dena Bank Bhubaneswar

Sub: Loan A/c No........

Dear Sir,

Humbly I beg to say few following facts about the development of Plant, Machineries and construction of Administrative Buildings.

First I invite you to pay your gracious visit to our plant site along with other officers to see the progress at your convenience.

Secondly the Supplier of Fly Brick, pavement tiles and pavers Block Machineries, i.e. LPM Engineering Pvt. Ltd. Ajmer Rajasthan has submitted fresh quotation to revalidate the offer price another 30 days from 05.07.2017 to 04.08.2017 adding GST which we have handed over to

bank. They have also sent separate copy to your branch. We have deposited Rs.2,00,000/- (Rupees Two Lakh only) to the Manufacturer of machineries from our Dena Bank C/A. Now you are requested to contact the manufacturer of Machine and transfer balance to their C/A which they have furnished in their offer letter and put pressure to supply the machine at earliest.

Thirdly, the ground floor work fully completed and ready for operation once furniture, fixture, and equipments are installed. Also the Second Floor brick work and plastering works are completed. Third Floor roof casting completed and brick work is in progress.

Fourthly, the road concrete work about to be completed as the heavy truck carrying fly ash facing problems to enter to stock yard.

Fifthly, the plant is fully ready for installation of machineries and all other works, namely, water reservoir, worker shed and rest room, tool room, raw material shed, finished goods shed and security room are completed.

Now some suppliers and contractors payments to be released as they have either finished their work or started their job whose list is enclosed herewith. This is for your favour of information and kind necessary action."

LIST OF SUPPLIERS AND CONTRACTORS (PART & FULL PAYMENTS)

List of Suppliers:

1. LPM Engineering P. Ltd: Rs.27,66,240.00 Proprietor Contribution : Rs. 6,91,560.00 Bank contributions : Rs.20,74,680.00

SUPPLIER

2. R.K. Enterprises- Rs.4,20,900.00 (Supply of walk tiles & floor tiles) Proprietor Contribution- Rs.1,05,225.00

Bank Contributions- Rs.3,15,675.00

3. Rourkela Steels - Rs.4,83,000.00 Proprietor Contribution- Rs.1,20,750.00 Bank Contribution- Rs.3,62,250.00

4. Annapurna Enterprisers - Rs.4,28,221.00 Proprietor Contribution - Rs.1,07,055.00 Bank Contribution - Rs.3,21,165.00

5. Ammilal Prasad - Rs.4,04,000.00 Proprietor Contribution - Rs.1,01,000.00 Bank Contributions - Rs.3,03,000.00

6. Euro Vigil (Supply of CC TV camera)- Rs.1,53,970.00 Proprietor Contribution - Rs. 38,450.00 Bank Contributions- Rs.1,15,477.00

7. Euro Vigil (Supply Bio matrices) - Rs. 43,480.00 Proprietor Contribution Rs. 10,870.00 Bank Contributions - Rs. 32,610.00

8. Baba Nilakantha Fabrications & Furniture-Rs.2,68,863.00 Proprietor Contributions - Rs. 67,216.00 Bank Contributions - Rs.2,01,647.00

9. Ajaya Electricals - Rs.1,53,000.00 Proprietor Contributions - Rs. 38,250.00 Bank Contributions - Rs.1,14,540.00

10. Rabindra Jena - Rs.1,92,144.00 Proprietor Contributions - Rs. 48,036.00 Bank Contributions - Rs.1,44,108.00

11. Mr. Nilambar Palei - Rs.1,54,500.00 Proprietor Contribution - Rs. 38,625.00 Bank Contributions - Rs.1,15,875.00

12. Mahodadhi Enterprisers - Rs.14,28,700.00 Proprietor Contribution - Rs. 3,57,175.00 Bank Contributions - Rs.10,71,525.00

6. Pursuant to the aforementioned letter, the opposite parties

on 06.09.2017 have also furnished an affidavit acknowledging her

request to disburse the amount. Relevant part of the said affidavit

reads thus:

"2. That, out of availed loan of Rs.2,00,00,000/- (Rupees two hundred lakhs) only from Dena Bank, Bhubaneswar Branch against Loan A/c No.075954021046, Rs.27,66,240/- (Rupees Twenty Seven Lakh Sixty Six Thousand Two Hundred Forty) only including my share towards purchase of fully automatic Fly Ash brick machine went to dispute due to fraudulent nature of supplier M/s. LPM Engineering Pvt. Ltd. Behind Adarsh Nagar Police Station, Parbatpura Byepass, Ajmer-305002 (Raj). However as I am associated my sister concern, which are capable of paying interest as well as capital in time from their sources, so there is no risk in repayment without causing any delay due to above mentioned reason.

3. That, I hereby indemnify to Dena Bank, Bhubaneswar Branch against the Loan A/c. No.075954021046."

7. Learned counsel for the petitioners has further submitted

that the facts of the present case is resembling to the facts of the

case decided by the Hon'ble Supreme Court reported in 2015 (6)

SC 287, Priyanka Srivastava and another vs. State of U.P. and

others. He has relied upon paragraphs-19, 27 & 33 of the said

judgment, which reads thus:

"19. We have narrated the facts in detail as the present case, as we find, exemplifies in enormous magnitude to take recourse to Section 156(3) Code of Criminal Procedure, as if, it is a routine procedure. That apart, the proceedings initiated and the action taken by the authorities under the SARFAESI Act are assailable under the said Act before the higher forum and if, a borrower is allowed to take recourse to criminal law in the manner it has been taken it, needs no special emphasis to state, has the inherent potentiality to affect the marrows of economic health of the nation. It is clearly noticeable that the statutory remedies have cleverly been bypassed and prosecution route has been undertaken for instilling fear amongst the individual authorities compelling them to concede to the request for one time settlement which the financial institution possibly might not have acceded. That apart, despite agreeing for withdrawal of the complaint, no steps were taken in that regard at least to show the bonafide. On the contrary, there is a contest with a perverse sadistic attitude. Whether the complainant could have withdrawn the prosecution or not, is another matter. Fact remains, no efforts were made."

"27. Regard being had to the aforesaid enunciation of law, it needs to be reiterated that the learned Magistrate has to remain vigilant with regard to the allegations made and the nature of allegations and not to issue directions without proper application of mind. He has also to bear in mind that sending the matter would be conducive to justice and then he may pass the requisite order. The present is a case where the accused persons are serving in high positions in the bank. We are absolutely conscious that the position does not matter, for nobody is above law. But, the learned Magistrate should take note of the allegations in entirety, the date of incident and whether any cognizable case is remotely made out. It is also to be noted that when a borrower of the financial institution covered under the SARFAESI Act, invokes the jurisdiction Under Section 156(3) Code of Criminal Procedure and also there is a separate procedure under the Recovery of Debts due to Banks and

Financial Institutions Act, 1993, an attitude of more care, caution and circumspection has to be adhered to."

"33. At this juncture, we may fruitfully refer to Section 32 of the SARFAESI Act, which reads as follows:

"32. Protection of action taken in good faith.- No suit, prosecution or other legal proceedings shall lie against any secured creditor or any of his officers or manager exercising any of the rights of the secured creditor or borrower for anything done or omitted to be done in good faith under this Act.""

8. Mr. Panigrahi, learned counsel for the petitioners on the

basis of the aforementioned decision, submitted that the impugned

order passed by the learned Magistrate is not sustainable, as the

said order has been passed without application of mind. He has

also pointed out the operative part of the impugned order, which

reads thus:

"In view of the aforesaid facts and circumstances of the case matter, nature and gravity of the offences, I felt it is desirable to send the complaint petition 1CC, Khandagiri P.S. for registration and investigation of this case U/s. 156(3) Cr. P.C. (The principles settled in OMM Oil @ Flour Mills Ltd. V. State of Orissa & Ors: (2009) 44 OCR 715: 2009 (Supp-II) OLR 332). The IIC Khandagiri P.S. is hereby directed to register the complaint petition within 24 hours of receipt of this order along with complaint petition for investigation U/s. 156(3) Cr. P.C. and to report compliance. He is also directed to follow up the principle/guide lines of Hon'ble Apex Court in the matter of Arnesh Kumar vs. State of Bihar & another.

In this regard the concerned IIC is directed to go through the decision passed by the Hon'ble Apex Court in Lalita Kumari..... vs. ..... State of U.P. and others (2008) 41 OCR (SC) 379 and to register the case forthwith.

Send the original complaint petition in ICC 2205/2020 to the IIC of Khandagiri P.S. for registration U/s. 156(3) of Cr. P.C. under intimation to this Court within seven days from the date of receipt of this order. The extract of this order be sent to the IIC, Khandagiri P.S. for information and the execution of law forthwith. Put up on 28.07.2020 for awaiting the intimation of the concerned IIC regarding the registration of the case U/s. 156(3) of Cr. P.C."

9. Mr. S.K. Dash, learned counsel for the opposite party No.3,

on the contrary, has submitted that this is not the stage where this

Court should give indulgence to the petitioners. The learned trial

Court has only directed for registration of the case and to

investigate the same. He has further submitted that, at this stage,

the only test is to see as to whether perusal of the allegation made

in the complaint prima facie discloses any offence or not. Mr.

Dash, learned counsel has extensively read out the contents of the

complaint and submitted that the allegations made by the opposite

party No.3 against the petitioners are to be investigated because

the allegation discloses penal offences. The criminal law has

already been set into motion. Therefore, invocation of the

jurisdiction of this Court under Section 482 of the Cr. P.C. at this

stage would curtail the due process of law. Repeated directions of

this Court to ascertain the status of the investigation has yield no

result, the opposite party No.1-State could not satisfactorily

appraise this Court regarding the status of the investigation.

He has also placed reliance on the judgment of the

Hon'ble Supreme Court in Criminal Appeal No. 2339 of 2023, A.

Sreenivasa Reddy vs. Rakesh Sharma & another. He has

submitted that the case cited by the learned counsel for the

petitioners namely Priyanka Srivastava (supra) is not applicable

to the present case. The petitioners are not entitled to any

immunity under law, even sanction under Section 197 Cr. P.C. is

not required on the facts of the present case. He has emphasized

paragraph-37 of the judgment, which reads thus:

"37. Having heard the learned counsel appearing for the parties and having gone through the materials placed on record the following questions of law fall for our consideration:

(i) Whether the appellant, serving in his capacity as an Assistant General Manager, State Bank of India, Overseas Bank, is removable from his office save by

or with the sanction of the Government so as to make Section 197 of the Cr.PC applicable ?

(ii) Is it permissible for the Special Court (CBI) to proceed against the appellant for the offences punishable under the IPC despite the fact that the sanction under Section 19 of the PC Act, 1988 to prosecute the appellant for the offences under the PC Act, 1988, is not on record as the same came to be declined ?"

10. I have given a careful consideration to the facts of the present

case and the judgment cited by both the parties. Perusal of the

documents and the relied upon judgments cited by the learned

counsels for the parties lead to the conclusion that the learned trial

Court has mechanically passed the order under Section 156(3) of

the Cr. P.C. The case of the petitioners is indeed akin to the facts

of the case in Priyanka Srivastava (supra). The Hon'ble Supreme

Court in the said matter has very categorically ruled that

invocation of the jurisdiction under Section 156(3) Cr. P.C. by the

borrower of the loan against the bank officials is not a routine

matter particularly when the bank has already resorted to the

proceeding under the SARFAESI Act. The facts of the present

case appear to be aimed at arm-twisting the bank by the

complainant.

11. Perusal of the complaint also reveals that, there is no

specific allegation individually made against the present

petitioners. The allegations are bald and general in nature against

the bank. Therefore, in the absence of the specific role attributed

to the petitioners individually, the opposite parties cannot bring

home the charges against all the bank officers those who were in

charge at the time of disbursement of the loan or at the helm of

the affairs of the bank. Moreover, disbursement of the amount has

been made on the basis of the written request made by the

opposite party No.3 and acknowledged by her by an affidavit as

observed above.

12. Therefore, no prima facie case is made out against the

petitioners on the basis of which the criminal case could have

been registered. The criminal law set into motion against the bank

officials, is of a serious nature. The bank officials might have

committed dereliction of their duty for which they are not

criminally liable, as there is no mens rea involved in the present

case.

13. In the fact scenario of the present case, I am inclined to

allow the present petition and quash the order dated 02.07.2020

passed by the learned S.D.J.M., Bhubaneswar directing the IIC,

Khandagiri Police Station for registration of the F.I.R. and

proceed with the investigation under Section 156(3) of the Cr.

P.C. on the complaint by the opposite party No.3 in 1CC Case

No.2205 of 2020.

14. Accordingly, the CRLMC is allowed.

......................

(S.S. Mishra) Judge

The High Court of Orissa, Cuttack Dated the 13th February, 2025/ Subhasis Mohanty

Designation: Personal Assistant Reason: Authentication Location: High Court of Orissa, Cuttack.

Date: 01-Mar-2025 15:11:53