Cbi vs 1 Hardeep Singh on 11 December, 2012

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Delhi District Court

Cbi vs 1 Hardeep Singh on 11 December, 2012

       IN THE COURT OF SH. V K MAHESHWARI :SPECIAL                                      
                   
                       JUDGE;  TIS HAZARI DELHI
                        Corruption Case No. 18/03



CBI                 Vs        1   Hardeep Singh 
                                   S/o Sh. Sawpuran Singh
                                   R/o 52/34, Ist Floor, Old Rajinder Nagar,
                                    New Delhi60

                                 2    Sh. Jeevan Khanna S/o Late Sh. D.D. 
                                       Khanna,
                                       r/o Q5/18, DLF, PhaseII, Gurgaon.

                                 3    Sh. Shamsher Singh Ahlawat 
                                       S/o Sh. Naval singh R/o 17/75, Urban 
                                       Estate, Gurgaon, Haryana

                                 4    Sh. V.P. Aneja S/o Sh. Shankar Das Aneja
                                        R/o C2/19, Janak Puri, New Delhi.
                                        ( Expired on 9.10.2008, Proceeding abated
                                         Vide order dt 19.5.2009)

                                  5    M/S Genexx Chemicals Private Ltd.
                                        N26, Malviya Nagar,
                                        New Delhi
                                         Through its Directors.

                                 6    Pratik Ratra S/o Sh. S.C. Patra
                                       R/o A2/57, Safdarjung Enclave, New Delhi
                                       ( Discharged by the Hon'ble High Court 


C C  No.18/03                                                                  1/133
                                         Vide order dt 3.5.2007)

R. C No.                                13(E) /2002/EOWI/DLI



Under Section                   120 Br/w 420, 468,471 IPC and Sec.
                                13 (2) r/w 13 (1) (d) P C Act, 1988

Date of Institution of  case:   24.12.2003
                                             

Arguments concluded on      29.11.2012



Date of Order                                11.12.2012



Judgment: 



Facts of the case:

1 Brief facts of the case according to prosecution are that Shri Jeevan Khanna, Managing Director (MD) M/s Genex Chemicals (P) Ltd. has obtained the credit facilities by mortgaging bogus/forged sale deed of property situated at Rojka Gujar. VP Aneja, valuer in connivance with Jeevan Khanna and others has over assessed the value of property. Hardeep Singh, the then Branch manager, P & S Bank, Fatehpuri Branch granted the Cash Credit (CC) limit of Rs.10 lacs and Letter of Credit (LC) Limited beyond his delegated powers. C C No.18/03 2/133 Hardeep Singh in connivance with Jeevan Khanna did not obtain the sale deed of plot No. 683, Sector3132A, Urban Estate, Gurgaon, in the name of Sh. Jeevan Khanna 2 Jeevan Khanna, (A2) opened a current account No. 3216 in the name of A5 company on 5.9.97 at Punjab & Sind Bank, Fatehpuri Branch, Delhi. A2 and A6 were the authorised signatories of the account. A1 submitted a loan proposal dated 10.2.98 to Branch Manager, Punjab & Sind Bank, Fatehpuri Branch, Delhi. Requesting for sanction of working capital limit of Rs.10 lacs and import LC of Rs.100 lacs. The processing cum appraisal note was prepared by Sh. R K Nagra, Loan Officer. A1 sanction the CC limit of Rs.10 lacs and import LC of Rs.100 lacs to A5 on 28.2.98. 3 A2 offered the landed property in the name of Shamsher Singh Ahalawat, r/o Sector 17/75, Gurgaon as collateral security. A4 V P Aneja, Bank's Panel Valuer submitted a false/inflated valuation report of agricultural land situated at Khewat No.1, Khata No.1, Kita 244,Rojka Gujar, Tehsil Sohna, Gurgaon 10 Bighas, 13 Biswas belonging to A3 Shamsher Singh Ahalawat and valued the property as Rs.65.61 lacs whereas the real value of the entire property was not more than Rs.5 lacs. It is further alleged that C C No.18/03 3/133 consequent to sanction order, various loan documents were executed on 2.3.98 by A2 and A6 on behalf of the company in the presence of R K Nagra. A3 fraudulently signed Form No. 84AA on 3.3.98 for mortgaging his agricultural land in the presence of R K Nagra, knowing fully well that he had already sold the major portion of the said property to the other persons. Equitable mortgage was created in favour of the bank on 2.3.98E by A3 by deposit of original sale deed of said property and entry to this effect has been made in the Title Deed Register by R K Nagra, loan officer and signed by A1 Hardeep Singh, Branch Manager. On the request of A2 Jeevan Khanna vide letter dt. 28.2.98 A1 converted CA No. 3216 into CC Account No. 87 on 12.3.98.

4 Shamsher Singh Ahalawat purchased land measuring 10 bigha and 13 biswa situated in village Rojka Gujar, Tehsil Sohna, Gurgaon from Nathi Singh on 19.3.96. On the very next day i.e. 20.3.96 Shamsher Singh sold 4 bigha out of this piece of land to D N Verma and Smt. Madhvi Verma for a consideration of Rs.1 lac. Subsequently he further sold another 4 bigha and 16 Biswa out of the same piece of land to Sandeep Malik and Mandeep Malik on 2.8.06 for a consideration of Rs.2.2 lacs. When Shamsher Singh submitted original sale deed of the said land in the bank on 2.3.98 for creation C C No.18/03 4/133 of Equitable Mortgage in favour of the bank, whereas more than 75% of the total land was already sold by him to other persons. One bigha and 17 biswa out of the same piece of land was frequently sold on 7.10.98 to K M Rajni d/o Hari Kishan for a consideration of Rs. 40,500/. There is a copy of Roznamacha dt. 20.12.97 of Halka Damdama, Tehsil Sohna, Gurgaon available in bank's record and as per entry No. 634 of this Roznamacha the property of Shamsher Singh Ahalawat situated in Khewat No.1, Khata No.1 to 17 at 213/183809 of total area 9190B9B i.e. 10 bigha and 13 biswa has been purportedly shown to be mortgaged with Punjab & Sind Bank for Rs.80 lacs. This entry has been allegedly signed by Yusuf Khan, patwari of the area, whereas Yusuf Khan denied his signatures on the said copy of the Roznamacha, who has retired from service in January 1997. Ved Pal Patwari has also stated that there is no such entry in the official Roznamacha and did not deliberately write separately to Sub Registrar for creation of bank's lien over the said property.

5 Hardeep Singh in conspiracy with A2 Jeevan Khanna and co accused did not obtain second non encumbrance Certificate from the Patwari in respect of above said land after four months of registration/creation of charge which is required as per bank's circular C C No.18/03 5/133 no. 1476 dt. 27.1.97. A2 Jeevan Khanna vide his letter dt. 25.1.99 requested the Branch Manager to release fresh LC Limit for Rs.70 lacs and (CC) limit of Rs.25 lacs. Before release of loan facility sanctioned on 24.8.98 Jeevan Khanna and Pratik Ratra executed the various loan documents on 25.1.99 in the presence of Inderjit Singh, Bank Officer on behalf of the party. A2. Jeevan Khanna fraudulently signed Form No. 84AA in respect of plot no. 683, Sector3132A, Urban Estate, Gurgaon on 25.1.99 knowingly that he had already sold the said plot to Sunil Kumar Gupta on 1.12.98. Shamsher Singh Ahalawat also signed Form No. 84AA in respect of property situated at village Rojka Gujar, Tehsil Sohna, Gurgaon knowingly that he was not the owner of the said property on that date and had no lawful authority to execute the same. He also signed form No.255 (Guarantee bond).

6 Hardeep Singh fraudulently made a false entry in this register in his own handwriting regarding receiving of title deed of said plot,but did not put the date. The original title deed of said plot was never placed in bank record.

7 Jeevan Khanna purchased plot no. 683, Sector3132A, Urban Estate, Gurgaon from Smt. Suneet Prabha Arora on 10.4.98 and applied in Estate Office HUDA to grant necessary permission to him to sell the said plot. The said permission was granted to him C C No.18/03 6/133 vide letter no. 4094 dt. 3.11.98. A2 Jeevan Khanna sold the said plot to Sunil Kumar Gupta r/o C109 Raj Nagar, Pitampura, NewDelhi on 1.12.98 and said plot was transferred in the name of Sunil Kumar Gupta on 31.12.98. Jeevan Khanna had fraudulently sold the mortgaged plot after sanction of the credit facilities and prior to release of the facilities on 25.1.99 and dishonestly signed Form No. 84AA in respect of mortgaging plot to bank for credit facilities availed by A5 company on 25.1.99 knowingly that the said property had already been sold by him on 1.12.98. A1Hardeep Singh with connivance of Jeevan Khanna fraudulently made entry in the title deed register regarding receiving of original title deed of plot no. 683, Sector3132A, Urban Estate, Gurgaon. The title deed of the said plot was never available in the bank's record. 8 A1 vide his letter dt. 2.1.99 requested Estate Officer, HUDA, Gurgaon for creating bank's lien over the property bearing plot no. 683, Sector3132A, Urban Estate, Gurgaon upon which The Estate Officer vide letter dt. 28.4.99 informed A1 that the said property had already been transferred to Sunil Kumar Gupta , therefore, no bank's lien can be marked on the property. This fact was neither brought on record by A1 nor senior officers were informed in this regard. Thus, A1 in conspiracy with the party, C C No.18/03 7/133 fraudulently allowed the party to avail the enhanced CC limit even after the receipt of letter dt. 28.4.99 from HUDA. 9 Jeevan Khanna on 8.6.99 submitted another request for opening another LC for US$ 147.688 (Rs.63.95 lacs approx.) 120 days on AWB basis without any margin. A1 vide letter 0.6.99 addressed to Zonal manager recommended that the party's aforesaid request be considered favourably and further informed that the party has also offered another collateral security in the form of their office premises N26 Malviya Nagar, New Delhi from the party and also obtained form no. 84AA from Smt. Neena Khanna regarding mortgaging the property in the bank and did not follow the order of zonal Office. Shri Iqbal Singh, Sr. Manager, P&SB has stated that under negative lien the bank does not have the right to retain the assets of the borrower and is also not entitled to realise its dues from the sale of the assets. The branch opened this LC on 28.7.99. this LC was also devolved due to non payment. An amount of Rs. 64,68,244/ was debited in the party's CC account on 15.12.99, the net balance in the account became Rs.1,20,59,748/ on 15.12.99. 10 Copies required U/S 207 Cr P C supplied to accused. After hearing both the parties vide order dt. 20.9.2005 charge had C C No.18/03 8/133 been framed against all the accused for the offence punishable U/s 120B r/w Secs.420, IPC and Section 13 (2) r/w Sec. 13 (1) (d) of P C Act, 1988. Charge for substantive offence U/s 13 (2) r/w 13 (1) (d) of P C Act against accused Hardeep Singh, U/s 420 IPC against accused Jeevan Khanna, Shamsher Singh Ahlawatand M/s Genexx Chemicals (P) Ltd. and Pratik Ratra was framed. All the accused pleaded not guilty to the charge and claimed trial, hence, this trial. 11 However accused V P Aneja and Pratik Ratra has preferred revision against the order of framing of charge against them to the Hon'ble high Court. Hon'ble high Court vide order dt. has quashed the order of framing of charge against both these accused. PROSECUTION EVEIDENCE.

12 Prosecution in order to prove its case has examined the following witnesses:

PW1, Sh. Gopi Chand has proved Seizure Memo dt.

9.12.02, Ex.PW1/A, sale deed Ex PW1/B, certified copy of sale deed dt. 20.3.96 Ex PW1/C, certified copy of sale deed dt. 20.8.96 Ex PW1/D and certified copy of sale deed dt. 7.10.98 Ex PW1/E, PW2 Sh. D N Verma has proved the documents already proved by PW1.

C C No.18/03 9/133

PW3, Sh. Rajinder Kumar Sharma has proved Account Opening Form of M/s Alfa Drugs Ex PW3/A and specimen card of Parteek Ratra Ex PW3/B. PW4, Kumari Rajni .Mahinder has proved the documents already proved by PW1.

PW5 Sh. Sunil Kumar Gupta has proved sale deed Ex.PW5/A, certified copy of allotment letter dt. 31.12.98 Ex PW5/B, certified copy of reallotment dt. 31.12.98 Ex PW5/ C, photo copy of reallotment letter dt. 12.12.91 Ex PW5/D, photo copy of re allotment letter dt.25.6.93 Ex PW5/E, photo copy of reallotment letter dt.10.5.96 Ex PW5/F, photo copy of reallotment letter dt. 19.3.98 Ex PW5/G photo copy of reallotment letter dt.13.5.98 Ex PW5/H,photo copy of reallotment letter dt.31.12.98 Ex PW5/I, Photo copy of Form C Allotment letter dt. 17.4.89 Ex PW5/J, Photo copy of Conveyance Deed dt. 21.11.96 Ex PW5/K, Photo copy of sale deed dt. 16.12.96 Ex PW5/L and Photo copy of sale deed dt. 10.4.98 Ex PW5/M, PW6 Sh. Nathi Ram has proved the documents already proved by PW1.

PW7 Sh. Rajinder pal Singh has proved Enhancement of Loan Proposal Ex PW7/A, sanction order Ex PW7/B and writing C C No.18/03 10/133 of Hardeep Singh on 41 page of title deed of register Ex PW7/C. PW8 Sh. Raj Kumar Nagra has proved Form No. 84AA Ex PW8/A, proposal dt. 28.2.98 Ex PW8/B, sanction letter dt. 2.3.98 Ex PW8/C, pronote Ex PW8/D, Form No.412 Ex PW8/E, Form No. 106 Ex PW8/F, Form No.291 Ex PW8/G, Form No.191 Ex PW8/H, Form No.192 Ex PW8/J, Form No.255 Ex PW8/K, Form Nos. 14, 412, 106,122, 251 and 126 Ex PW8/L to Ex PW8/Q, Form No.159 Ex PW8/R, Title deed Register Ex PW8/U and specimen signatures of Shamsher Singh Ahlawat Ex PW8/V1 to Ex PW8/V18.

PW9 Sh. Inderjeet singh has proved Form No.14 i.e Promissory Note Ex PW9/1, Form No.412 Ex PW9/2, Form No. 106 Ex PW9/3, Form No. 122 Ex PW9/4, Form No. 126 Ex PW9/5, Form No. 291 Ex PW9/6, Form No. EXP37/96 Ex PW9/7, Form No. 255 Ex PW9/8, Form No.14 in respect of CC Limit of Rs.70 lacs Ex PW9/10, Form No. 412 Ex PW9/11, Form No.106 Ex PW9/12, Form No.122 Ex PW9/13, Form No.126 Ex PW9/14, Form No. 291 Ex PW9/15, Form No. EXP37/96 Ex PW9/16, Form No. 255 Ex PW9/17, Form No. 159 Ex PW9/18, Form No. 191 Ex PW9/19, Form No. 192 Ex PW9/20, Form No. 159 Ex PW9/21, Form No. 191 Ex PW9/22, Form No. 192 Ex PW9/23, Form No. 84AA (D80) Ex PW9/24, Form No. 84AA (D81) Ex PW9/25, Form No.255 (revised) Ex PW9/26, Form No. 255 (revised) Ex PW9/27, Form No. 255 C C No.18/03 11/133 (revised) Ex PW9/28 and two affidavits of Jeevan Khanna (D77 & D78) Ex PE9/DC and Ex PW9/DD.

PW10, Sh. Ved Pal has proved letter dt. 29.11.02 Ex PW10/A, photocopy of Mutation Register with regard to mutation No. 2893 Ex PW10/B, photocopy of Mutation Register with regard to mutation No. 2900 Ex PW10/C, photocopy of Mutation Register with regard to mutation No. 3110 Ex PW10/D, photocopy of Mutation Register with regard to mutation No.3147 Ex PW10/E, photocopy of Roznamacha starting from 20.12.97 to 22.12.97 Ex PW10/F and photocopy of Roznamacha Rapat No. 557 to 564 Ex PW10/G. PW11 Sh. J S Kochar has proved Booklet containing I D Circular No. 1476 dt. 27.1.1977 Ex PW11/X, and points 1 to 7 on page 39 of booklet Ex PW11/X1 and also proved the documents already proved by other witnesses.

PW12Sh. Iqbal Singh Monga has deposed orally. He has not proved any document.

PW13 Sh. Satinder singh has proved letter (D63) Ex PW13/A. PW14 Sh. Subey Singh has proved sale deed (D87) Ex PW14/A and seizure memo (D86) Ex PW14/B. PW15 Sh. Vikas yadav has proved sale deed No. 5640 regd. C C No.18/03 12/133 On 19.3.96 Ex PW15/X, certiified copies of Index register and Foot note register Ex PW15/A to Ex PW15/G, PW16 R S Saini has proved seizure memo dt. 28.8.03 Ex PW16/A, Title Deed register (D75) Ex PW16/B, Board Resolution request for opening of LC for US $27,084.00 Ex PW16/1, application form dt. 7.1.99 Ex PW16/2, further Resolution for opening of LC for US $104,000.00 Ex PW16/3, application form dt. 16.12.98 Ex PW16/4, further Resolution for opening of LC for US $147,668.00 Ex PW16/5, application form dt. 26.7.99 Ex PW16/6, statement of account dt. 5.9.97 to 31.12.98 Ex PW16/7, statement of account dt. 12.3.98 to 8.2.99 Ex PW16/8, statement of account dt. 3.4.99 to 31.3.2000 Ex PW16/9, current account opening form dt. 5.9.97 Ex PW16/10, extract of minutes of the Boards Resolution dt 3.2.98 Ex PW16/11 and also proved the documents already proved by other witnesses.

PW17 Sh. T R Lakhani has proved account opening form dt. 5.4.95 of account no.514/3 Ex PW17/A, specimen signature Card Ex PW17/B and also proved the documents already proved by other witnesses.

PW18 Sh. Gajender Singh has proved note sheet (D64) Ex PW18/A and noting encircled in red appearing on D66 Ex PW18/B and also proved the documents already proved by other C C No.18/03 13/133 witnesses.

PW19 Sh. Gurnam Singh has proved letter dt. 10.2.98 Ex PW19/A, valuation report dt. 1.3.98 Ex PW19/B, letter dt. 19.11.02 ExPW19C, valuation report dt. 16.10.97 Ex PW19/D, letter dt. 17.1.03 Ex PW19/E and also proved the documents already proved by other witnesses.

PW20 Sh. Dalbir Singh Kalra has proved report dt. 27.8.99 Ex PW20/A and letter dt. 18.12.99 Ex PW20/B and also proved the documents already proved by other witnesses.

PW21 Sh. Satendra Singh has proved fIR Ex PW21/A, Seizure Memo (D52) Ex PW21/B, Seizure Memo (D89) Ex PW21/C, Seizure Memo (D93) Ex PW21/D, Seizure Memo (D96) Ex PW21/E, specimen handwriting of Sh. Hardeep singh Ex PW21/G1 to G9, Seizure Memo (D34) Ex PW21/H, letter/opinion of GEQD dt. 8.12.03 Ex PW21/J, letter dt. 15.10.03 Ex PW21/K and charge sheet Ex PW21/L and also proved the documents already proved by other witnesses.

PW22 Sh. T K Roy Chaudhary has proved Production cum seizure memo dt. 27.11.02 Ex PW22/A. PW23 Sh. Baljeet Singh has proved account opening form of account No. 1933 Ex PW23/A, specimen signature card of Pratik Ratra Ex PW23/B, authority letter for the operationof account Ex C C No.18/03 14/133 PW23/C and also proved the documents already proved by other witnesses.

PW24 Sh. J B S Bedi has proved circular (D23) Ex PW24/A and letter dt. 15.1.2000 Ex PPW24/A, letter dt. 11.1.2000 Ex PW24/B, letter dt. 18.12.99 Ex PW24/C, letter dt. 23.7.99 Ex PW24/D and also proved the documents already proved by other witnesses.

PW25 Sh. Manjeet Singh Sarang has proved sanction order Ex PW25/A. PW26Sh. T joshi Asstt. GEQD has proved Q208 on Ex PW 26/A, Q211 & Q212 on Ex PW 26/B, Q 213 on Ex PW 26/C, Q215 on Ex PW 26/D, Q217 on Ex PW 26/E, Specimen writings/ signatures marked S37 to S54 purported to be written by Sh. Jeewan Khanna on Ex PW 26/F1 to Ex PW 26/F18, report no. CX226/2003 dt. 30.9.2003 Ex PW 26/G, the detailed reasons for his opinion Ex PW 26/H, The supplementary opinion no. CX226/2003 dt. 20/11/2003 Ex PW 26/J and the detailed reasons for his opinion Ex PW 26/K..

DEFENCE OF ACCUSED AND DEFENCE EVIDENCE 13 Statements of all the accused U/s 313 Cr PC recorded wherein they have denied all the allegations made against them and C C No.18/03 15/133 evidence produced by the prosecution. They have stated that they are innocent & have been falsely implicated in this case. 14 Accused Hardeep Singh has stated that the title deed was taken and kept in safe custody after making entry in the title deed register. When he was transferred and was handing over charge it was discovered that the title deeds of property No.683 Gurgaon was not on the file. Subsequently inquiries were made and it was revealed that someone had taken out the said documents from the file to oblige Mr Jeevan Khanna. The official at Head office had directed him to do the formalities in consultation with bank's legal counsel and he has complied their order and the legal opinion was that since the property at N26 Malviya Nagar is on GPA hence as per their directions negative lien was obtained.

15 It is stated by accused Jeevan Khanna that all loan documents were signed by all the Directors of Company on behalf of the company, loan was obtained and used by company only. He never mortgaged property No.683 with bank. The company was a sole distributor of a foreign company dealing in life saving drugs to all leading hospitals of India. Company suffered heavy losses and could not met with its financial commitments. The company has not cheated the bank or played any fraud with the bank as alleged in the C C No.18/03 16/133 charge sheet . The company A/C was running satisfactorily for quite a long time as deposed by witnesses in above case. There is no complaint against the company nor there is any incriminating evidence against the company. The dispute between Company & bank was only a civil dispute and a suit was filed in DRT by the bank which is still pending. The bank to put pressure on him made the above false case against Company and all concerned for recovery of their dues. He has not made any criminal conspiracy with any of the coaccused nor he ever mortgaged any property which was already mortgaged / sold. To show his bonafide he voluntarily mortgaged property No. N26 Malviya Nagar which is presently valued to Rs.70 to 80 lacs and original title deed is still lying with the bank. He has been falsely implicated in this case.

16 Accused Shamsher Singh has stated that he never visited bank in this matter and everything is concocted against him. 17 In their defence accused have examined following witnesses:

DW1 Sh. Saiful Islam has proved photocopy of his legal opinion Ex DW1/A. DW2 Sh. Roshan Lal Goel,Advocate has proved photocopy of C C No.18/03 17/133 his legal opinion Ex DW 2/A and Ex DW2/B. DW3 Sh. Mahinder Kumar has provedauthority letter dt. 22.9.2011 Ex DW3/A. DW4 Sh. Satish Kr. Relan has proved letter dt. 24.1.05 Ex DW4/A. DW5 Sh. Harvinder Singh has proved original application of 7.8.2001 Ex DW5/A. DW6 Sh. Gurmej Singh has proved his Valuation report dt.

18.6.99 Ex DW6/A. PW7Sh. R C Gupta has proved Valuation certificate dt. 16.10.97 Ex DW7/A. DW8 Sh. Chander Mohan has deposed orally.

DW9 Sh N K Tokas has been examined partly. Thereafter he was never summoned for his further examination.

DW10 Sh Rohit Mehra has proved the certified copies of ordersheets 14.8.2001 to 9.1.2001 Ex DW10/A collectively, certified copies of ordersheets 19.4.2011 to 29.3.2012 Ex DW10/B collectively, certified copy of WS filed by Respdt. No.5 Shamsher Singh Ex DW10/E. DW11 Sh. Deepak Jain has proved his report dt.

30.7.2012 ExDW11/A and enlarged photographs Ex DW11/B. C C No.18/03 18/133 PROSECUTION ARGUMENTS 18 It is argued by Ld Sr PP Sh Brajesh Shukla that in this case accused persons namely Hardeep Singh, Jeevan Khanna,Shamsher Singh Ahlawat, V P Aneja and Prateek Ratra were charged under Section 120B IPC r/w 420 IPC and 13 (20 r/w 13(1)

(d) of P C Act 1988. For bringing home the charges prosecution has examined altogether 26 prosecution witnesses and by referring the specific depositions tallying with concerned documents prosecution has tried to impressed upon the Court that above said accused persons having conspired with each other cheated Punjab & Sind Bank, Fatehpuri Branch, Delhi by fraudulently inducing the bank to disbursed / sanction/ obtained credit facility in the name of M/S Genxx Chemicals Pvt Ltd, whose Managing Director was accused Jeevan Khanna.

19 It is further submitted on behalf of prosecution that on the basis of false / fabricated documents like sale deed, valuation report etc M/S Genexx Chemicals Pvt Ltd was extended credit facilities to the extend of Rs.165.62 lacs and for this purpose accused Jeevan Khanna being M.D of M/S Genexx Chemicals submitted loan proposals requesting for sanction of working capital of Rs.25 lacs and C C No.18/03 19/133 import L.C of Rs.100 lacs . Accused Shamsher Singh mortgage the sale deed knowing fully well major portion of mortgaged property was already sold . Accused V P Aneja who was then working as bank's panel valuer submitted false / inflated valuation report showing the value of agricultural land situated at Rojkagujjar Tehsil, Sohana, Gurgaon to the extent of Rs.65.61 lacs whereas there are evidence confirming the fact that said property was not more than Rs. 5 lacs . Accused Prateek Ratra being Director of M/S Genexx Chemicals Pvt Ltd was the authorised signatory of M/S Genexx Chemicals Pvt Ltd and he signed / executed the loan document, which were got processed by accused Hardeep Singh by use of illegal means and abusing his official position and subsequently accused Hardeep Singh in the capacity of Branch Manager of Punjab & Sind Bank, Fatehpuri Branch Delhi, on the basis of false and fabricated documents, disbursed/ sanctioned the credit facility to the tune of Rs. 165.62 lacs in favour of M/S Genexx Chemicals Pvt Ltd. 20 In other words , accused Hardeep Singh in the capacity of public servant working as Branch Manager of Punjab & Sind Bank, Fatehpuri Branch Delhi enabled accused Jeevan Khanna and Prateek Ratra to obtain pecuniary wrongful gain to the extent of Rs. 165.62 lacs causing corresponding wrongful loss to Punjab & Sind C C No.18/03 20/133 Bank, Fatehpuri Branch. In this way, prosecution has proved its case beyond the shadow of all reasonable doubts. Although Defence counsel also got examined 11 Dws for rebutting the charges framed against accused persons but their endeavor, if analyzed with the evidence in record, could not bring the consequences of high gravity which could support their stand in any way rather fortified the prosecution case impliedly as such accused persons may be hold guilty for the charges framed against them .

DEFENCE ARGUMENTS 21 Sum and substance of the arguments of Ld Defence counsel for accused Hardeep Singh is that sanctioning authority had accorded sanction for his prosecution in a mechanical manner without applying mind to all the relevant documents thus the same is bad, hence he cannot be prosecuted in this case; no preliminary inquiry has been conducted before the registration of R C in question which is in violation of the rules, hence accused is entitle for acquittal; there is no evidence on the file to prove meeting of mind between accused Hardeep Singh and his coaccused hence prosecution has failed to prove involvement of this accused in the alleged criminal conspiracy; accused Hardeep Singh had taken the C C No.18/03 21/133 title deed of property bearing Plot No. 683 Sector 3132A U.E Gurgaon, he cannot be blamed if the property paper have been taken out by someone in his absence and handed over to Jeevan Khanna; there is no evidence on the file to show that accused Hardeep Singh had obtained any pecuniary advantage in the alleged transaction thus no case U/S 13 (1) (d) of P C Act is made out accused is innocent, he may be acquitted.

22 In nutshell the arguments on behalf of accused Jeevan Khanna are that he is innocent; he had neither mortgaged nor deposited the title deed of property bearing Plot No.683 Sector 3132A U.E Gurgaon in the bank; it was a civil dispute ; Jeevan Khanna had taken loan from the bank on 2.3.98 which he was regularly repaying thereafter limit was enhanced on 24.8.98 when accused allegedly deposited the title deed in question thus accused was having no dishonest intention at the very beginning i e on 2.3.98 to cheat the bank, therefore necessary ingredient of the offence of cheating punishable U/S 420 IPC are missing; bank has filed a suit for recovery against the accused which is pending in the DRT which again confirms that it was a civil dispute.

23 Ld Defence counsel for accused Shamsher Singh has filed detailed written submission which are on the file therefore on C C No.18/03 22/133 account of brevity I am not reproducing his arguments in this judgment however I will discuss his arguments at the appropriate stage.

During pendency of this case accused V P Aneja expired on 9.10.2008 . CBI has confirmed the factum of his death after verifying the same therefore present proceedings have been abated against him vide order dated 19.5.2009. Accused Pratik Ratra was discharged by the Hon'be High Court vide order dated 3.05.2007.

PUBLIC SERVANT AND SANCTION 24 Accused Hardeep Singh was the then posted as Branch Manger in Punjab & Sind Bank, Fatehpuri Branch, thus, he was performing public function, therefore, was a public servant. Even during the course of argument accused has not disputed this fact. In these circumstances, it is undisputed that accused Hardeep Singh was a public servant at the relevant time of commission of this offence. 25 PW 25 Sh. Manjeet Singh Sarang has deposed that In the month of December, 2003 he was General Manager working as Zonal Manager in the Zonal office of Punjab & Sindh Bank, Delhi. C C No.18/03 23/133 Accused Hardeep Singh was working as Branch Manager. By virtue of holding the post of General Manager, he was authority competent to remove Hardeep Singh from his post. After carefully perusing and examining the material including documents and statements of witnesses placed before him with regard to allegations and circumstances of this case, he was satisfied and found the case prosecutable, therefore, he had accorded sanction for the prosecution of accused Ex. PW25/A accorded by him under his signature. 26 Ld. Defence Counsel for accused Hardeep Singh argued that sanctioning authority had accorded sanction without application of mind. Granting of sanction is not an ideal formality or acrimonious exercise but a solemn and sacrosanct act which affords protection to government servants against frivolous prosecution and must therefore be strictly complied with before any prosecution can be launched against the public servant. Any case instituted without a proper sanction must fail. In support of his arguments he has placed reliance on S N Boss Vs State of Bihar AIR 1968 SC 1292 . He has further argued that Mansukh Lal V Chouhan Vs State of Gujrat 1997 7 SCC

622. It is argued that Hon'ble Supreme Court has held that validity of sanction depends upon the material placed before the sanctioning authority and the fact that all the relevant facts, material and evidence C C No.18/03 24/133 have been considered by the sanctioning authority. The order of sanction must exfacie disclose that the sanctioning authority had considered the evidence and other material placed before it. 27 Ld Defence counsel referred para No 27 of the charge sheet, where it is mentioned as follows: " GEQD opinion on some documents was awaited and the same alongwith original document will be filed after receipt of original documents." 28 It is argued that this charge sheet was filed in this Court on 24.12.2003 while sanction for the prosecution of accused in this case Ex PW25/A was taken on 22.12.2003. It is argued that I O has deposed in his cross examination that he had filed only the relied upon documents in the Court alongwith the charge sheet. He had not filed original legal opinion dated 29.6.99 of property situated at N26, Malviya Nagar N Delhi given by Sh Roshan Lal given and valuation report of Sh Gurmej Singh dt 15.6.99 which was seized vide seizure memo Ex PW16/A ( D74) . He accepted that he has not filed the orignal form 84AA dated 29.7.99 executed by Smt Neeta Khanna in respect of above said property. He has also not relied upon the other legal opinion and valuation report and stated that the said documents may be in the office of CBI or in the Malkhana of CBI. This clearly C C No.18/03 25/133 shows that the IO had not produced all the documents before the sanctioning authority, in absence of these documents, sanction has been granted. Had the sanctioning authority perused the record carefully, it would not have accorded sanction in this case. 29 It is argued that prosecution has not produced any evidence as to what document and whose statement were forwarded to the competent authority for accorded sanction . By suppressing the legal opinion and valuation report the prosecution did not bring to the knowledge of the sanctioning authority that the property was held by Smt Neeta Khanna through papers such as GPA,Will etc and since she had not sale deed in her favour no equitable mortage would have been created. The prosecution has also suppressed Ex PW13/A from the perusal of sanctioning authority wherein the H.O ( Foreign Exchange ), Rajender Nagar had directed that " additional facilities should be released only after effective mortgage is created of property situated at N26 Malviya Nagar N Delhi, valued Rs.30 lacs in the name of Mrs Neeta Khanna after fulfilling necessary formalities in consultation with bank's legal counsel. 30 It is further argued that the word "Effective Mortgage" is not used purposely because the head office knows that Smt. Neeta C C No.18/03 26/133 Khanna had this property under GPA and no sale deed was executed in her favour. If the higher officials wanted that the property should be equitably mortgaged, they would have given such directions. PW25 Sh. M S Sarang, the Sanctioning authority stated in his cross examination that " By effective mortgage I mean mortgage of the property by deposit of title deed on the basis of legal opinion". 31 It is further argued that along with the letter dated 09.06.99(D62) ( Ex. PW13/D1), accused Hardeep Singh has also sent letter dated 08.06.99 where it was clearly written that as a gesture of goodwill, we hereby offered to you an additional security of our office, N 26, Malviya Nagar, New Delhi, which were holding on Power of Attorney in the name of Mrs. Neeta Khanna, approximately market value of Rs. 30 to 35 lacs. From 09.06.99 to 28.07.99 several meetings were held in the Zonal Office. 32 Ld. Defence Counsel referred the deposition of PW18 Sh. Gajender Singh and PW24 J B S Bedi in this regard. Ld. Defence Counsel emphasized the deposition of PW25 that by effective mortgage, he means mortgage of the property by deposit of title deed on the basis of legal opinion and argued that it shows that sanction had been obtained after suppressing the material facts, i.e. the legal C C No.18/03 27/133 opinion and valuation report of property no. N26, Malviya Nagar. It is argued that the deposition of the sanctioning authority clearly exhibits that he was reluctant to answer the question but the fact remains that there was no suppression and of facts on behalf of Hardeep Singh. The Zonal office as well as the Head Office knows that the property is under GPA. It could be effectively mortgaged according to the legal advise, hence they did not write that it should be equitably mortgaged. Hence, no wrong has been committed by Hardeep Singh, he was duty bound to send the proposal, if he thinks that the party has faced a genuine problem. Likewise, the Zonal Office was also duty bound to send the proposal to the Head Office. 33 It is argued by Ld. Defence Counsel that from the material collected/available on record, it is crystal clear that the decision taken was a collective one. The decision was required to be taken in the exigency of the situation. The decision to equitably mortgaged the property at Malviya Nagar was done in compliance of the order of the higher authority and not for causing any wrongful gain to themselves or the borrower or for causing wrongful loss to the bank.

34 Ld. Defence Counsel in support of his arguments has placed C C No.18/03 28/133 reliance on the following authorities:

Mansukh Lal V.Chauhan Vs. State of Gujrat, (1977) 7.SCC 622 and K.C. Singh Vs. CBI, 2011 Laws(DLH)8268.

35 I have carefully gone through the sanction order Ex.PW25/A,which is a detailed order running in two sheets having all relevant material particulars of this case. Para No. 8 and 9 of this sanction order is as under:

" And whereas I (Sh. M.S. Sarang, General Manager) being the disciplinary authority and competent authority to remove the said Sh. Hardeep Singh, the then Branch Manager, Fatehpuri Branch, from the bank after carefully examining the material including documents and statements of witnesses recorded by the Investigating Officer placed before me in regard to the allegations and the circumstances of this case, consider that Sh. Hardeep Singh, the then Branch Manager had committed the offences and should be prosecuted in the competent court of law for the said offences".

"Now, therefore, I ( Mr. M.S. Sarang, General Manager) do hereby accord sanction U/s 19 (1) (c ) of PC Act, 1988 for the prosecution of Sh. Hardeep Singh, the then branch Manager for the said offences and any other offences punishable under the provisions of law in respect of the aforesaid acts C C No.18/03 29/133 and for taking cognizance of the said offences by the court of competent jurisdiction".

36 A bare perusal of sanction order Ex. PW25/A and para no. 8 & 9 of this order quoted above reflects that sanctioning authority had carefully examined the statement of witnesses and documents placed before him. After examining the documents placed before him and the statement of witnesses sanctioning authority reached to the conclusion that accused Hardeep Singh, the then Branch Manager should be prosecuted in the competent court of law and accorded sanction for his prosecution.

37 PW 25 Manjeet Singh Sarang in his examination in chief in this regard has deposed as follows:

" After perusing and carefully examining the material including documents and statements of witnesses placed before me with regard to allegations and circumstances of this case, when I became satisfied and found the case prosecutable I accorded the sanction for prosecution dated 22.12.2003, which bears my initial with official round seal at point A on first page and full signatures along with rectangular seal at point B on the last page. The same is Ex. PW25/A".

38 He has been crossexamined at length on behalf of accused C C No.18/03 30/133 Hardeep Singh. His entire crossexamination is as under:

"It is wrong to suggest that CBI had sent a draft sanction order of Ex PW 25/A. It is correct that I have not mentioned in Ex PW 25/A as to which documents and statement of which witness I had perused. Today I do not remember whose statement I had perused and which documents I had seen prior to passing of sanction order. At the time when I was General Manager as Incharge of Zonal Office Hardeep Singh was Branch Manager in Regional Office. I do not remember where Hardeep Singh was posted on 22nd December 2003. I do not remember whether even after this case accused Hardeep Singh was promoted and posted in various good branches. It is correct that monthly report was being sent by the Branch Manager to controlling office. I do not remember whether any lapse was found in loan sanctioned by Hardeep Singh during my stay in Zonal office. I was not posted in Zonal office at the time when the loan was sanctioned to M/s Genexx Chemicals Pvt. Ltd. Whatever the lapse were committed by Hardeep Singh must be mentioned in Ex PW 25/A. I do not remember whether valuation report and legal opinion was with me when Ex PW 25/A was drafted. It must be in the file. By effective mortgage I mean mortgage of the property by deposit of title deed on the basis of legal opinion. Now I do not remember how I written in Ex PW 25/A that Hardeep Singh was to release the L/C only after creating effective mortgage on property situated at N26 Malviya Nagar (Half portion of basement, New Delhi). Now I do not remember because of long lapse of time as on which basis I have mentioned in Ex PW 25/A the above line. Now I do not remember whether I had been shown the legal opinion qua mortgage of property at N26 Malviya Nagar. Q If the legal opinion given by the penal advocates of the bank showing that C C No.18/03 31/133 property N26 Malviya Nagar was only on General Power of Attorney and cannot be equitably mortgaged and a negative lien can be created, I would not have sanction prosecution of the accused?

Ans: I cannot say again said I do not remember.

Now I do not remember as to how many days the file with regard to sanction of prosecution of accused remained with me. IO never met me. This file was received by me through my department. I had not heard any adverse remark against accused Hardeep Singh in my tenure. It is correct that from 199 to 2003 accused Hardeep Singh had worked as branch Manager in different branches. I must have perused the personal file of accused also. I had not heard whether accused has faced DE in any other case. It is wrong to suggest that I have given sanction for prosecution of accused under the pressure of CBI".

39 In the crossexamination of this witness nothing such has come out to disbelieve his deposition, thus, his deposition can be relied upon.

From the above quoted para no. 8 & 9 of the sanction order Ex. PW25/A and above quoted deposition of sanctioning authority Sh. Manjeet Singh Sarang, it is clear that sanctioning authority after perusing, whatever documents produced before him and after going through the statements of witnesses had reached to the conclusion that accused should be prosecuted by a competent court of law and accorded the sanction for his prosecution, which was also prepared by sanctioning authority himself.

C C No.18/03 32/133 40 It is also proved on the file that sanctioning authority had not received any draft of sanction order from the CBI and himself prepared the sanction order Ex. PW25/A, which is clear from his crossexamination wherein he has denied the suggestion that CBI had sent a draft sanction order to him. Relevant portion of his cross examination in this regard is as under:

" It is wrong to suggest that CBI had sent a draft sanction order Ex. PW25/A. It is correct that I have not mentioned in Ex. PW25/A as to which documents and statement of which witness I had perused. Today I do not remember whose statement I had perused and which document I had seen prior to passing of sanction order".

41 Granting of sanction for the prosecution of an accused rests upon the subjective satisfaction of sanctioning authority. If the sanctioning authority after examining the statements of witnesses and whatever documents produced before him reached to the conclusion after applying his mind that the case is fit for granting sanction then nonproduction of other documents before the sanctioning authority does not cause any damage.

42 According to accused, GEQD opinion on some documents was C C No.18/03 33/133 awaited and some original documents were not placed before the sanctioning authority as mentioned in para no. 27 of chargesheet. It is a matter of experience that CBI send photocopies of the documents to the sanctioning authority for his perusal, CBI hardly send the original documents to the sanctioning authority for his perusal. It has neither been asked from sanctioning authority nor from IO during their crossexamination that whether photocopies of such documents were sent or not.

43 Meticulous perusal of the exhibited documents like Ex PW21/K , Ex PW26/G, Ex PW26/H, Ex PW7/C and Ex PW21/G1 to G9 which are forwarding letter dated 15.10.2003 by GEQD, opinion , reasons for opinion entry made at page 41 of title deed register and specimen hand writing of Sh Hardeep Singh surfaced the fact that Defence counsel in his arguments by referring the fact mentioned in charge sheet relating to "GEQD opinion and some documents awaited and the same alongwith original documents will be filed after receipt of original documents." In fact the opinion in respect of Hardeep Singh, as mentioned in para3 of Ex PW26/G, was received through letter dated 15.10.2003 Ex PW 21/K from GEQD which is much prior to filing of charge sheet dated 24.12.2003, on the basis of which sanction dated 22.12.2003 Ex PW25/A was accorded by C C No.18/03 34/133 Sanctioning authority. Therefore, it is clear that the plea of defence on this count is meritless rather the order of sanction exfacia disclose the fact that the sanctioning authority has considered the evidence and other material placed before him before according sanction for prosecution.

44 Hon'ble Supreme Court in Kalpanath Rai v. State(through CBI), (1997 (8) SCC 732), has observed by this Court that the sanctioning authority is not required to wait for the report of the experts. The sanctioning authority has only to see whether the facts disclosed in the complaint prima facie disclose commission of an offence or not. The actual production of the tapes etc., are matters for proof during trial and not necessarily to be undertaken at this stage. It is true as contended by learned counsel for respondent No.1, grant of sanction is not empty formality.

45 It is not for the sanctioning authority to judge the truth of the allegations made against the accused by calling for the records of the case. It is enough if he goes through all the relevant papers put before him and is satisfied that it was necessary in the ends of justice to accord the sanction. (Indu Bhushan Chatterjee V. State of West Bengal, AIR 1958 SC 148 Cr. LJ279) C C No.18/03 35/133 46 Hon'ble Supreme Court in Shiv Raj Singh Vs Delhi Administration AIR 1968 SC 1419, in this regard has held as follows:

" Where the order of sanction shows on the face of it what were the facts constituting the offence charged and that a prima facie case was made out against the accused and the order further recites that the sanctioning authority " after fully and carefully examining the material before him in regard to the aforesaid allegations in the case, considers that a prima facie case is made against the accused" the order fulfill the requirement of Sec 6 of the Prevention of Corruption Act."

47 In this regard, Hon'ble Supreme Court in Superintendent of police (CBI) Vs. Deepak Chaudhary - 1995 SCC (Crl.) 1095 has held as follows:

''We find force in the contention. The grant of sanction is only an administrative function, though it is true that the accused may be saddled with the liability to be prosecuted in a court of law. What is material at that time is that the necessary facts collected during investigation constituting the offence have to be placed before the sanctioning authority and it has to consider the material. Primafacie, the authority is required to reach the satisfaction that the relevant facts would constitute the offence C C No.18/03 36/133 and then either grant or refused to grant sanction. The grant of sanction, therefore, being administrative act the need to prove an opportunity of hearing to the accused before according sanction does not arise. The High Court, therefore, was clearly in error in holding that the order of sanction is vitiated by violation of the principles of natural justice.''

48 Hon'ble Supreme Court in Kottha Perumal Vs. State Tr. Inspector of Police, Vigilance and Anti Corruption, AIR 2011 Supreme Court 356 has held as follows:

"Prevention of Corruption Act (49 of 1988) - Sanction to prosecute - Legality Examination of material facts by sanctioning authority - Sanction order specifically stating that statement of witnesses have been duly examined - Other materials such as copy of FIR as well as other official documents such as different mahazars were carefully examined Upon examination of statements of witnesses as also material on record, sanctioning authority has duly recorded its satisfaction that appellant should be prosecuted - Sanction order is legal".

49 Hon'ble Supreme Court has held that where the sanction order itself is a speaking order in such circumstances, it is not necessary to prove it by leading evidence that sanctioning authority has applied his due mind. Reliance is placed on C S Krishnamurthy Vs. State of Karnataka 2005 IV AD (S.C.) 141 wherein in para No.9 it is observed as follows:

C C No.18/03 37/133

"Therefore, the ratio is sanction order should speak for itself and in case the facts do not so appear, it should be proved by leading evidence that all the particulars were placed before the sanctioning authority for due application of mind. In case the sanction speaks for itself then the satisfaction of the sanctioning authority is apparent by reading the order. In the present case, the sanction order speaks for itself that the incumbent has to account for the assets disproportionate to his known source of Incom. That is contained in the sanction order itself. More so, as pointed out, the sanctioning authority has come in the witness box as witness No.40 and has deposed about his application of mind and after going through the reports of the Superintendent of Police, CBI and after discussing the matter with his legal department, he accorded sanction. It is not a case that the sanction is lacking in the present case. The view taken by the Additional Sessions Judge is not correct and the view taken by learned Single Judge of the High Court is justified".

50 Though from the above discussion, it is proved beyond reasonable doubt that there is no non application of mind by sanctioning authority and the sanction order accorded by him for the prosecution of accused in this case without perusing the GEQD report and some of the original documents is valid. Still, according to sub section 3(a) of Section 19 and explanation of Section 19 of PC Act, 1988, accused has to show a failure of justice has been caused because of any error, omission or irregularity in the sanction order. C C No.18/03 38/133

"(a) No finding, sentence or order passed by a special judge shall be reversed or altered by the court in appeal, confirmation or revision on the ground of the absence of, or any error, omission and irregularity in, the sanction required under subsection (1), unless in the opinion of that court a failure of justice has in fact occasioned thereby";

51 Explanation given in section 19 of PC Act, 1988 in this regard is as under:

" Explanation. For the purpose of this section,

(a) error includes competency of the authority to grant sanction.

52 In this case accused has not shown as to what prejudice has been caused to him.

53 Hon'ble Supreme Court in Ashok Tshering Bhutia V. State of Sikkim, AIR 2011 SUPREME COURT 1363 in this regard has held as follows:

" Prevention of Corruption Act(49 of 1988), Section 19 Sanction to prosecutionmere error,omission or irregularity in C C No.18/03 39/133 sanction not fatal unless it has resulted in failure of justice".

It is further observed as follows in para no. 12 of this authority:

" Same remained the position regarding sanction. In the absence of anything to show that any defect or irregularity therein caused a failure of justice, the plea is without substance. A failure of justice is relatable to error, omission or irregularity in the sanction. Therefore, a mere error, omission or irregularity in sanction is not considered to be fatal unless it has resulted in a failure of justice or has been occasioned thereby. Section 19 (1) of the PC Act, 1988 is a matter of procedure and does not go to the root of the jurisdiction and once the cognizance has been taken by the Court under Cr. P.C., it cannot be said that an invalid police report is the foundation of jurisdiction of the court to take cognizance. ( Vide Kalpnath Rai (supra); State of Orissa v. Mrutunjaya Panda, AIR 1998 SC 715;

State by Police Inspector v. Sri T. Venkatesh Murthy, (2004) 7 SCC 763: (AIR 2004 SC 5117); Shankerbhai Laljibhai Rot v. State of Gujarat (2004) 13 SCC 487; Parkash Singh Badal & anr. V. State of Punjab & Ors., AIR 2007 SC 1274; and M.C. Mehta v. Union of India & Ors. ( Taj Corridor Scam), AIR 2007 SC 1087). 54 I have carefully gone through the authorities relied upon by Ld C C No.18/03 40/133 Defence counsel, as discussed above the facts and circumstances of case is hand are different then that of these authorities, therefore ratio of law laid down in these authorities is not applicable in the facts and circumstances of the case in hand.

55 In view of above discussion and after considering the matter from various angles, this Court is of opinion that there is no merit in the defence arguments, prosecution has proved valid sanction order for the prosecution of accused Hardeep Singh in this case. WHETHER REPORTS OF HANDWRITING EXPERT PW26 Sh T JOSHI AND HIS EVIDENCE CAN BE RELIED UPON 56 Whether the reports of Handwriting Expert Sh. T Joshi Ex PW26/H and Ex. PW26/J and his reasons for opinion Ex. PW26/K and his evidence can be relied upon.

57 Specimen handwriting/signatures of accused Hardeep Singh were taken by the IO during the Investigation of this case in presence of PW19 Sh. Gurnam Singh, which are Ex. PW21/G1 to Ex. PW21/G9 ( S28 to S36)(D27). In this regard IO has deposed that C C No.18/03 41/133 he had taken specimen handwriting of accused Hardeep Singh Ex. PW21/G1 to Ex. PW21/G9 in presence of Sh. Gurnam Singh. Hardeep Singh had given his specimen handwriting voluntarily. 58 Specimen handwriting/signatures of accused Jeevan Khanna were taken by the IO during the Investigation of this case in presence of S.K. Gupta which are Ex. PW26/F1 to Ex. PW26/F9 (S37 to S54)(D105). In this regard IO has deposed that he had taken specimen handwriting/signatures/initials of accused Jeevan Khanna Ex. PW26/F1 to Ex. PW26/F18 in presence of Sh. S.K. Gupta. Accused Jeevan Khanna had given his specimen handwriting/ signatures/initials voluntarily.

59 Specimen signatures of accused Shamsher Singh Ahlawat were taken by the IO during the Investigation of this case in presence of PW8 Sh. Raj Kumar Nagra which are Ex. PW8/V1 to Ex. PW8/V18 (S1 to S18)(D85). In this regard PW8 Sh. Raj Kumar Nagra has deposed that specimen signatures of accused Shamsher Singh were taken in his presence. He had identified his signatures on each sheet Ex. PW8/V1 to Ex. PW8/V18.

60 Hon'ble Supreme Court in a recent Judgment Ravinder Kumar C C No.18/03 42/133 Pal @ Dara Singh Vs. Republic of India, AIR 2011 SC 1436 has held that taking of specimen signatures and writing of accused for examination by experts during the investigation is proper and report of Expert based on such signatures/writings can be used as evidence against the accused. Relevant portion of Para No.35 of this authority is as under:

" Another question which we have to consider is whether the Police (CBI) had the power under the Cr.PC to take specimen signature and writing of A3 for examination by the expert. It was pointed out that during investigation, even the Magistrate cannot direct the accused to give his specim signature on the asking of the police and only in the amendment of the Cr PC in 2005, power has been given to the Magistrate to direct any person including the accused to give his specimen signature for the purpose of investigation. Hence, it was pointed out that taking of his signature/writings being per se illegal the report of the expert cannot be used as evidence against him. To meet the above claim, learned Addl. Solicitor General heavily relied on a 11Judge Bench decision of this court in the State of Bombay V. Kathi Kalu Oghad and Ors. (1962) 3 SCR 10: AIR 1961 SC 1808. This larger Bench was constituted in order to reexamine some of the propositions of law laid down by this Court in the case of M P Sharma & Ors. Vs. Satish Chandra, District Magistrate, Delhi and ors., (1954) SCR 1077: (AIR 1954 SC 300). ."

61 After discussing the matter in detail Hon'ble Supreme Court has concluded as follows:

"In view of the above principles, the procedure adopted by the investigating Agency, analysed and approved by the trial court and confirmed by the High Court, cannot be faulted with. In view of oral report of Rolia Soren , PW4 which was reduced into writing, the evidence of PW23, two letters dt. 01.02.2002 and 02.02.2002 addressed by Mahendra Hembram (A3) to the trial Judge facing his guilt coupled with the other materials, we are unable to accept the arugment of Mr. Ratnakar Dash, learned Senior Counsel for Mahendra Hembram (A3) and C C No.18/03 43/133 we confirm the conclusion arrived by the High Court."

62 A bench of 11 judges of Hon'ble Supreme Court in State of Bombay Vs. Kathikalu AIR 1961 SC 1808in this regard has held as follows:

"Testimonial compulsion - Obtaining specimen writing and thumb inpression from accused - Statement of accused in police custody used in evidence - If contravene constitutional guarantee - Constitution of India, Article 20 (3).

Section 73 of the Indian Evidence Act empowers the court to obtain specimen writing or finger impression of an accused person for purposes of comparison .

Section 5 and 6 of the Identification of Prisoners Act empowers a Magistrate to obtain the photograph or measurements of an accused person. Section 27 of the Indian Evidence Act permits the reception in evidence of statements made by an accused person in police custody which lead to a discovery. It was contended by accused persons that the obtaining of evidence in any of these ways ammounted to compelling the person accused of an offence "to be a witness against himself" in contravention of Article 20 (3) of the Constitution. It was further contended that it was implicit in the fact that the accused was in police custody when the specimen signatures or thumb impression etc. were obtained that compul was used.

Held, that there was no infringement of Article 20 (3) of the Constitution in compelling an accused person to give his specimen handwriting or signature, or impressions of his thumb, fingers, palm or foot to the investigating officer or under orders of a court for the purpose of comparison.

Held, further, that the provision of Section 27 of the Indian Evidence Act did not offend Art. 20 (3) unless compulsion was used in obtaining the information. Compulsion was not inherent in the receipt of information from an accused person in the custody of a police officer; it will be a question of fact in each case to be determined by the court on the evidence before it whether compulsion had been used in obtaining the information." C C No.18/03 44/133

63 PW 26 Sh. T Joshi has deposed that he has more than 20 years of experience in the profession of forensic documents examination. He had examined hundreds of cases consisting of lacs of exhibits. He has appeared as an independent expert witness in various courts throughout the country.

64 As Sh T Joshi has more than 20 years experience in examination of forensic documents and has examined hundreds of cases having large number of exhibits and appeared as an expert witness in various courts through out the country, hence according to Section 45 of Indian Evidence Act, opinion of a person having special skilled in a particular field and science is relevant as an expert opinion. In these circumstances, this Court is of opinion that he has special training and long experience in examination of questioned documents/ handwriting thus certainly he is an Handwriting Expert. This witness has been crossexamined at length on behalf of all the accused, but nothing such has come in his crossexamination so as to disbelieve his evidence/report/ opinion.

65 Hon'ble Supreme Court in Murari Lal Vs. State of C C No.18/03 45/133 Madhya Pradesh (1980) 1 Supreme Court Cases 704 with regard to evidenciary value of Handwriting Expert Report and its corroboration by other evidence has held as follows:

"Evidence Act, 1872 - Sections 45, 46, 73 and 3 - Evidence of handwriting expert

- Held, need not be invariably corrborated - It is for the Court to decide whether to accept such an uncorroborated evidence or not - Court should approach the question cautiously and after examining the reasonings behind the expert opinion and considering all other evidence should reach its conclusion - Even where there is no expert court has power to compare the writings itself and decide the matter - On facts, courts below on such comparison concurring with the exper's view and the defence raising no doubts against the reasons given by the expert for his opinion - Held, opinion evidence acceptable without any corroboration."

66 Similar view has been taken Hon'ble Supreme Court in Ram Narain Vs. Uttar Pradesh AIR 1973 SC 2200 wherein it is held as follows:

"Both under Section 45 and Section 47 the evidence is an opinion in the former by a scientific comparison, and in the latter on the basis of familiarity resulting from frequent observatrions and experience. in either case the Court must satisfy itself by such means as are open that the opinion may be acted upon. One such means open to the Court is to apply its own observation to the admitted or proved writings and to compare them with the disputed one, not to become a handwriting expert but to verify the premises of the expert in the one case and to appraise the value of the opinion in the other case. This comparison depends on an analysis of the characterstics in the admitted or proved writings and the finding of the same characterstics in large measure in the disputed writing. In this way the opinion of the deponent whether expert or other is subjected to scrutiny and although relevant to start with becomes probative. Where an expert's opinion is given, the Court must see for itself and with the C C No.18/03 46/133 assistance of the expert come to its own conclusion whether it can safely be held that the two writings are by the same person. This is not to say that the Court must play the role of an expert but to say that the Court may accept the fact proved only when it has satisfied itself on its own observation that it is safe to accept the opinion whether of the expert or other witness."

67 Accused Shamsher Singh Ahlawat has produced DW11 Deepak Jain, Handwriting and Finger print expert, who has given report in his favour. He has given his qualifications as Bsc and stated that he had obtained one year certificate in Forensic Science from Delhi University in the year 198788 and obtained practical training for about two years in the office of Mr. R K Vij. He has given opinion in more than 2500 cases.

68 PW 26 T Joshi Asstt. GEQD has deposed that he has more than 20 years of experience in the profession forensic documents examination and has examined hundreds of cases consisting of lacs of exhibits. He has further deposed that he had appeared in various courts throughout the country. He is in Central Govt. Job. He is an independent person.

69 DW11 Sh. Deepak Jain in his crossexamination has stated that he has no degree and diploma in forensic science. He is the sole earning member to maintain his family. In this case he had charged C C No.18/03 47/133 total fees of Rs.11,000/. He has admitted the fact that he has not given opinion against the party, who has engaged him, in any case. He cannot equated with competent person of GEQD, who is well qualified and given job of examination after being duly qualified/recommended by UPSC; on the other hand experience gained during his official tenure by examining various documents in different cases gravavates his knowledge and experience. Further there is no occasion to disbelieve him as nothing on record could come on the basis of which it can be adhere that GEQD expert was the prejudiced one with the accused persons. As such I am of the opinion that his opinion is independent and reliable in comparison to that of given by DW11 Sh. Deepak Jain.

70 A division bench of Hon'ble High Court of Himachal Pradesh in Gulzar Ali Vs. State of Himachal Pradesh 1995 Crl. Law Journal 810 comparing the evidence given by a Govt. examiner and a private Handwriting Expert has held that a private expert has a natural tendency to support the view of the person who had called him. The evidence of Govt. examiner is more reliable in such circumstances. Relevant portion of Para no. 17 of this authority is as under:

"Looking to the statements of these experts, proving their expert opinion, we prefer to depend on the opinion given by Sh. M L Sharma (PW20) C C No.18/03 48/133 Government Examiner on Questioned Documents. It is more satisfactory and satisfying. It is more reasonable and dependable. It is more scientific as compared to the opinion of Sh. N K Jain (DW1), which is not so thorough and convincing. It is neither reasoned nor satisfactory. There is natural tendency on the part of the expert to support the view of the person who had called him. It can, therefore, be said that there is sufficient material on the record for coming to the conclusion that the accused were conspiring with each other and the object of conspiracy was not only the family of Jai Paul but also the deceased".

71 In view of above discussion this court is of opinion that specimen writings/signatures of accused in this case were legally taken by the IO during the investigation which were used by PW 26 Sh T Joshi, Handwriting Expert for comparing with the questioned writings/signatures. PW 26 Sh. T Joshi is a competent Handwriting Expert of questioned documents. His evidence and reports/reasons/ opinion given in this case are authentic and reliable without any corroboration.

ROLE OF ACCUSED HARDEEP SINGH 72 According to prosecution, accused Hardeep Singh was the then posted as Branch Manager in Fatehpuri branch, Punjab and Sindh Bank. He entered in a criminal conspiracy with his coaccused Jeevan C C No.18/03 49/133 Khanna, MD, M/s Genex Chemicals Pvt. Ltd., Sh. Prateek Ratra, Director, M/s Genex Chemicals Pvt. Ltd., Shri V P Aneja, Banks Approved Valuer and Sh. Shamsher Singh Ahalawat with the object to cheat the Punjab & Sindh Bank, Fatehpuri Branch as a public servant and sanctioned the loan and thereafter enhanced the CC limit and LC limit to M/s Genex Chemicals Pvt. Ltd. against the properties furnished as collateral securities for equitable mortgage which were already sold. He had relied upon forged copy of Roznamcha dated 20.12.97 of Halka Demdama, TehSohna, Gurgaon available in Bank's record and did not obtain second non encumbrance certificate from the patwari in respect of the mortgaged property( the said land) after four months of registration/creation of charge which is required as per bank's circular No. 1476 dated 27.01.97. He had neither submitted the valuation report of the mortgaged property nor obtained the same from the Accountant/Second officer of the branch(as directed in circular No. 1476 dated 27.01.97). At the time of disbursement of enhance CC limit from Rs. 10 lacs to Rs. 25 lacs and LC limit reduced from Rs. 100 lacs to Rs. 70 lacs on 25.01.91. He had not obtained the Original Title Deed of the mortgaged property in respect to Plot No. 683, Sec3132A, Urban Estate, Gurgaon in the name of Mr. Jeevan Khanna. He had neither brought on the record that plot no. 683, Sec3132A, Urban Estate, Gurgaon, C C No.18/03 50/133 transferred in the name of Sh. Sunil Kumar Gupta as per letter dated 28.04.99 of Estate officer, HUDA, Gurgaon nor informed Senior officers in this regard. He had vide his letter dated 09.06.99 recommended to Zonal Manager on the request of Jeevan Khanna dated 08.06.99 for opening another LC for US$ 147,668 ( Rs. 63.95 lacs approx.) for 120 days on AWB basis without any margin. Inspite of the fact that there was net debit balance in the CC account was Rs. 57,01,209/ on 24.05.99. He had also informed the Zonal Manager that party has also offered another collateral security in the form of their office premises, i.e. N26, Malviya Nagar, New Delhi valued at Rs. 30 lacs in addition to the existing two properties held with the bank. But he had concealed the fact that Jeevan Khanna had already sold the property bearing No.683, 3132A Urban Estate Gurgaon while recommending, the above referred LC. He had opened LC of Rs.65 lacs without creating effecting mortgage of property No. N26, Malviya Nagar, New Delhi while Zonal office approval communicated by Sh. J B S Bedi, AGM, Zonal Office vide his letter dated 28.07.99 to open the LC only after effective mortgage of the property. He had obtained the negative lien in favour of the bank of property No. N26, Malviya Nagar from the party and obtained form No. 84AA from Smt. Neeta Khanna regarding mortgaging the property without following the order of Zonal Office. He opened the C C No.18/03 51/133 above said LC on 28.07.99. This LC was also devolved due to non payment. An amount of Rs. 6468244/ was debited in the parties CC account on 15.12.99, the net balance in the account became Rs. 1,20,59,748/ on 15.12.99.

EVIDENCE PRODUCED BY THE PROSECUTION AGAINST THE ACCUSED HARDEEP SINGH 73 PW10 Sh. Ved Pal has proved that Roznamcha No. 634 dated 20.12.95 was not issued by their office and forged. Actually value of the land was 70000/ per Acre at that time . He further proved that no entry is available regarding pledge of the said land by Shamsher Singh in their record, Vide PW10/1. Relevant portion of his deposition in this regard is as under:

" I have seen the copy of the entry No. 634 dated 20.12.97 of the daily diary ( Roznamcha) of our office regarding pledge 10 bighas and 13 biswas of land in Khewat no.1, Khata No.1 to 107 in village Rozka Gujjar by Shamsher Singh to Punjab and Sind Bank, Fatehpuri Branch, Delhi for Rs. 80 lacs. I confirmed this Roznamcha has not been issued by our office as on 20.12.97 as per our record Ex. PW10/F, the Rapat No. 203 was available while the Roznamcha regarding Rs. 80 lacs, the Rapat no. is 634. On 21st and 22nd C C No.18/03 52/133 December, 1997, the rapat no. was 204 to 207. In this way the rapat No. 634 shown in roznamcha mark 10/1 is not possible. This roznamcha is fake. I have also seen copy of mutation register(D24) which was issued by Yusuf Khan Patwari. The same is Ex.PW10/G. I cheeked my original record available today and state that on 20.12.97 only one entry was made in this register vide no. 203. Further no entry exists in our record regarding pledging of the said land by Shamsher Singh. In fact, last entry in our Roznamcha is 564 for the year 1997. During the year 199798 the prevalent rate per acre of the similar nature in village Rozka Gujjar was Rs.70,000/. After that the prevalent rate become lower. During the year 2002 the open market of the prevalent rate of the land is not more than Rs. 1 lakh per acre".

74 Roznamcha no. 634 has been marked as PW10/1for identification purpose only because it is a forged document, hence the same cannot be exhibited as its author, is not clear. 75 Accused Hardeep Singh relied upon forged copy of Roznamcha dated 20.12.97 of Hakla Damdama, Tehsil Sohna, Gurgaon. As per entry no. 634 of this Roznamcha the propety of Shamsher Singh Ahlawat situated in Khewat No.1, Khata No. 1 to C C No.18/03 53/133 107 at the 213/183809 of total area 9190B9B, i.e. 10 Bighas and 13 Biswa has been purportedly shown to be mortgaged with Punjab & Sind Bank for Rs. 80 lacs.

76 Bank had sanctioned the credit limit of Rs. 110 lacs, however, in this Roznamcha lien mark for Rs.80 lacs only. Accused Hardeep Singh, the than Branch Manager should have confirmed from the concerned authority for the same before disbursement of the loan. The property had already been sold by the Mortgager Shamsher Singh and mutation also done in the record of Tehsildar. ( PW10/B:

D9( M.NO. 2893), PW10/C: D6( M.No. 2900), PW10/D: D7 ( M.No. 3110), PW10/A: D8( M.No. 3147).

77 As per bank's circular No. 1476 dated 27.01.97, PW11/X(D68) where agriculture land is accepted as security(para

5) "Second Non Encumbrance Certificate should be obtained after four months of registration/creation of charge which should indicate the encumbrance of PSB on the land accepted as security". 78 But accused Hardeep Singh did not obtain second non encumbrance certificate from the patwari in respect of the mortgaged property( the said land) after four months of registration/creation of C C No.18/03 54/133 charge which is required as per bank's circular no. 1476 dated 27.01.97 because he was actually in connivance and conspiracy with his coaccused Jeevan Khanna and Shamsher Singh Ahlawat. 79 As per bank's circular No. 1476 dated 27.01.97, PW11/X(D68)(para no. 3) PropertyPrimary Security/Additional Security "A valuation certificate from an architect/Govt./Bank's approved valuer/ reputed independent broker giving clearly the value of land and superstructure separately should be obtained and kept on record along with valuation by Manager/Accountant signed jointly. Subsequently valuation should be got done after every two years as per prescribed procedure. Accused Hardeep Singh neither submitted the valuation of the mortgaged property and nor he obtained the same from the Accountant/second officer of the branch as directed in circular no. 1476 dated 27.01.97. 80 Accused Hardeep Singh at the time of disbursement of enhanced CC limit from Rs. 10 lacs to 25 lacs and LC limit reduced from 100 lacs to 70 lacs on 25.01.99 which was initially sanctioned on 2.3.98 at Rs. 10 lacs( CC limit) and Rs. 100 lacs ( Import LC) did not obtain the Original Title Deed of the mortgaged property in respect to Plot No. 683, Sec31, 32A, Urban Estate, Gurgaon in the C C No.18/03 55/133 name of Mr. Jeevan Khanna. As per bank guidelines the entry is to be made in the title deed register of the bank indicating that original sale deed of the mortgaged property has been deposited with the bak for creation of equitable mortgage. He fraudulently made a false entry in the title deed register of the bank in his own handwriting regarding receiving of title deed of said property/plot and did not put the date at point Q 10 &11.

81 PW26 Sh. T. Joshi , GEQD in his report has opined that entry at Sr. No. 2 at point Q10 on page 41, Ex. PW7/C of title deed register Ex. PW16/B is in the handwriting of accused Hardeep Singh. This fact has also been corroborated by PW7 Sh. Rajender Pal Singh. Relevant portion of his deposition in this regard is as under:

" I have seen the title deed register(D75). In this title deed register, the property mortgage is entered. I identify the writing of Hardeep Singh at page 41 of the title deed register from point A to A. I also identify the signatures of Hardeep Singh at point B on the page 41 of the title deed register. The same is Ex. PW7/C".

82 PW5 Shri Sunil Kumar Gupta proved that he had purchased plot No.683, Sec 31 32A Urban Estate Gurgaon from Jeevan Khanna C C No.18/03 56/133 on 30.11.98 in consideration of Rs.546560/ vide sale deed Ex PW5/A . He has also proved photocopy of reallotment letter Ex PW5/H issued by HUDA in his favour on 31.12.98 .

83 PW14 Shri Subey Singh has proved that Jeevan Khanna sold property No.683, Sec 31 32A Urban Estate Gurgaon to Sunil Kumar Gupta vide sale deed dt 1.12.98 Ex PW14/A. He also proved that re allotment letter issued by HUDA in his favour on 31.12.98. 84 PW11 Sh G S Kochar has deposed that when he conducted staff accountability report Sh Hardeep Singh did not produce original title deed of property No.683, Sec 31 32A Urban Estate Gurgaon, however the entry of the same is mention in the equitable mortgage register. Relevant portion of his deposition in this regard is as under :

" I had checked the details about the account of M/S Genexx Chemical Pvt Ltd wherein letter of credit was devolved and the account had become NPA. Devolution of LC was not the basic issue of my checking as devolution of LC or consequent loss is considered a business loss. What I had to examine what were the lapses on the part of Mr Hardeep Singh in execution of the documents and taking of securities etc for the transaction of loan.

The title deed of Gurgaon property was to be obtained in term of the sanction as security by the Branch Manager, Sh Hardeep Singh. It was property of Plot No.683 Sector31,Gurgaon. When I checked the records the C C No.18/03 57/133 details were recorded in the registered as security but the titled deeds were not shown to me. Not showing of the title deeds to me during my checking showed that he had failed to take the original title deed in possession of the bank. When the original title deeds were not taken there could be no mortgage."

85 He has also proved that when there is gap between date of inspection and actual date of disbursement, inspection of the intervening period is desirable. In this regard he has deposed as follows:

" In cases where there is sufficient gap between the date index inspection and the date of actual disbursal of the amount, index inspection of the intervening period is also desirable. Normally there no much gap between the date of sanction and the date of disbursal, however, if there is long gap between the two, fresh index inspection for the intervening period should be got done so as to make sure that the mortgagor has not created any further encumbrances during the intervening period. Fulfillment of all these requirement is required to be ensure by the Branch Manager."

86 PW20 Sh Dalbir Singh Kalra has proved that when he took the charge of branch from Shri Hardeep Singh the original title deed of property No.683, Sec. 31 32A Urban Estate Gurgaon was not available on bank record and the same has been mentioned in the charge report Ex PW20/A. He has deposed that entry regarding C C No.18/03 58/133 mortgage of property 683, Sec. 31 32A Urban Estate Gurgaon was made in the title register Ex PW7/C. 87 PW 20 had succeeded accused Hardeed Singh on his transfer as Senior Manager PNB Fatehpuri Branch on 22.7.99 and remained there till 31.12.99. He had taken over charge from accused Hardeep Singh . He has specifically deposed that title deed of property No.683 Sector 31 32A Gurgaon was not on record . He had mentioned the same in his charge report dt 27.8.99. Relevant deposition in this regard is as under:

" When I took the charge as Sr Manager title deed of property No. 683 , Sector 31/32A, Gurgaon was not on record and I had mentioned the same in my charge report dated 27.8.99 . I have prepared a list of irregularities account wise and categories wise which has been signed by myself as well as Hardeep Singh at point A & B respectively, I had send one copy it to the Zonal Office and one copy to Head Officer as per bank procedure, I had kept one copy of the same with me."

88 In Ex. PW20/A at Sr. No. 79, this witness has specifically mentioned that title deed of the property in the name of Jeevan Khanna not traceable on the record.

89 This witness has also directed for fresh index inspection report C C No.18/03 59/133 of property No. 683, Sec31, 32A, Urban Estate, Gurgaon vide letter Ex. PW20/B dated 18.12.99. Relevant portion of his deposition is as under:

"I have seen Ex. PW20/B is the letter dated 18.12.99 signed by me at point A for getting the fresh index inspection report of property plot No. 683, Sector 31, 32A, Urban Estate, Gurgaon mortgaged in the case of M/s Genexx Chemicals Pvt. Ltd".

90 Accused Hardeep Singh vide his letter dated 25.01.99 requested Estate Officer, HUDA, Gurgaon for creating bank's lien over the property bearing plot no. 683, Sec.3132A, Urban Estate, Gurgaon. The estate office HUDA Gurgaon vide his letter dated 28.04.99, informed the bank manager, P & S Bank, Fatehpuri Brancbh, Delhi that the said property had already been transferred to Sh. Sunil Kumar Gupta, therefore, no banks lien can be marked on the property. This fact was neither brought on record by Hardeep Singh, Branch manager nor senior officers were informed in this regard. The said property was purchased by Jeevan Khanna from Smt. Suneet Prabha Arora W/o Satpal Arora on 10.04.98 and the said plot was transferred in the name of Jeevan Khanna on 13.05.98. Jeevan Khanna applied in Estate Office HUDA to grant necessary permission to sell the same plot on 02.11.98. C C No.18/03 60/133 Estate Office HUDA granted necessary permission to Jeevan Khanna vide their letter No. 4094 dated 03.11.98 and Jeevan Khanna sold the said plot to Sh. Sunil Kumar Gupta R/o C109, Raj Nagar, Pitampura, New Delhi on 01.12.98 and the said plot was transferred in the name of Shri Sunil Kumar Gupta on 31.12.98.

91 PW14 Subey Singh had proved that HUDA vide letter dated 28.04.99 informed the Bank that property, i.e. 683, Sec31, 32A, Urban Estate, Gurgaon had already been sold by Jeevan Khanna to Sunil Kumar Gupta. Relevant portion of his deposition in this regard is as under:

" Some bank inquiry concerning loan with regard to this property was received in our office and it was informed by our office that this property has already been sold by Jeevan Khanna to one Sh. Sunil Kumar Gupta".

92 Letter dated 28.04.99 (D21) written by Estate Officer, HUDA, Gurgaon to Manager, Punjab & Sind Bank, Fatehpuri Branch is as under:

"The property bearing no. 683, Sector 31,32A, Gurgaon has already been transferred to Sh. Sunil Kumar Gupta S/o Sh. R.K. Gupta through sale deed. No mortgage permission issued by this office. First charge will be of HUDA as per HUDA policy. No lieu C C No.18/03 61/133 can be marked at this stage".

Estate officer HUDA Gurgaon 93 PW20 Sh. Dalbir Singh Kalra has proved that the letter of HUDA was never received in his period. Relevant portion of his deposition in this regard is as under:

"When I had taken other the charge from previous Manager title documents of Plot No. 683, Sector 3132A, Urban Estate, Gurgaon were not available and the letter dated 28.04.99 written by HUDA to the Branch that the property has already been sold and the lien of the bank cannot be marked in their books came to my notice after completion oft eh charge of the branch on 27.08.99 that is why I had written letter Ex. PW20/B to the Advocate for getting the fresh index inspection report. It is correct that according to prior report the property was unencumbered. Letter dated 28.04.99 was not on the record when I had taken over the charge. The letter of HUDA came to my notice few days prior to my communicating to the lawyer vide my letter Ex. PW20/B".

94 PW18 Sh Gajender Singh has proved that Shri Hardeep Singh never informed Zonal Office about letter dt 28.4.99 of HUDA whereby HUDA authorities had informed that Jeevan Khanna had sold the plot to Sunil Kumar Gupta and bank lien cannot be created C C No.18/03 62/133 on the said property.

95 Relevant deposition of PW 18 Sh Gajender Singh in this regard is as under:

" I have seen D61, this is a letter written by Estate Office HUDA Gurgaon is with regard to transfer of property in the name of Sunil Kumar. This fact was not mentioned in the loan proposal submitted to the Zonal Office, the same is Mark A."

96 Two LC,s dated 22.12.98 and 14.1.99 for Rs. 44.72 lacs and Rs.11.65 lacs respectively were opened which were develved on 12.4.99 and 24.5.99 due to non payment. An amount of Rs. 4475339/ on 12.4.99 and amount of Rs.1165309/ on 24.5.99 was debited due to devolvement of above said two LC,s .The net debit balance in the CC account was Rs.57,01,209/ on 24.5.99 . Hardeep Singh Branch Manager vide his letter dated 9.6.99 regarding another request of Jeevan Khanna dt 8.9.99 for opening another LC for US $ 147,668 ( Rs.63.95 Lac approximately ) for 120 days on AWB basis without any margin, recommended to Zonal Manager that the party's request for availment of fresh LC amounting to US $ 147668 be considered favorably. Hardeep Singh also informed Zonal Manager C C No.18/03 63/133 that the party has also offered another collateral security in the form of their office premises i e N26, Malviya Nagar, New Delhi valued at Rs.30 lacs in addition to the existing two properties held with the bank. Hardeep Singh dishonestly and fraudulently concealed the fact that Jeevan Khanna has already sold the property while recommending the opening of fresh LC on behalf of M/S Genex Pvt Ltd which again proves his involvement in the criminal conspiracy with his coaccused.

97 Hardeep Singh opened another LC amounting to Rs.65 lacs after obtaining the approval from Zonal Office without creating effective mortgage of the property i e N26, Malviya Nagar, N Delhi valued at Rs.30 lacs, while Zonal office approval communicated by Shri JBS Bedi, AGM, Zonal Office vide his letter dated 28.7.99 to open the LC only after effective mortgage of the property. Hardeep Singh obtained the negative lien in favour of the bank of the property and also obtained form No.84 AA from Smt Neeta Khanna regarding mortgaging the property in the bank and did not follow the order of Zonal Office . He also made entry in the title deed registered regarding receiving of negative lien and other papers. He never informed the Zonal Office/ Head office in this regard. C C No.18/03 64/133 98 Hardeep Singh opened the above said LC on 28.7.99 . This LC was also devolved due to non payment. An amount of Rs.6468244/ was debited in the parties CC account on 15.12.99, the net balance in the account became Rs.12059748/ on 15.12.99.

99 PW24 Shri JBS Bedi has proved that after devolvement of two LC Hardeep Singh vide letter dt 9.6.99 requested Head Office to open another LC. He also informed that the party has offered another property situated at N26, Malviya Nagar, New Delhi valued at Rs.30 lacs in addition to the existing two properties held with the bank. Foreign exchange branch directed Zonal Manager to open the LC only after effective mortgage of property of Malviya Nagar, Ex PW13/A. Zonal office vide letter dt 28.7.99 directed Branch Manager Fatehpuri Branch to open the LC only after properly mortgage of property of Malviya Nagar. The branch had taken negative lien to mortgage the property as per legal advise and Hardeep Singh had not taken the permission to create the negative lien in respect of this property from competent authority.

100 Relevant deposition of PW 24 JBS Bedi in this regard is as under :

C C No.18/03 65/133

" Today I have seen letter dt 9.6.99 the same is D62 addressed to Zonal Manager Punjab & Sind Bank under the signatures of the then Manager of Fatehpuri Branch already Exhibited as Ex 13/D1. The contents of letter shows that M/S Genexx Chemicals Pvt Ltd has devolved its existing LC and had been recommended for opening of new LC for Rs.63,94,000/ . Whereas, its earlier devolved LC was of Rs. 32.01 lac. The LC on 32.01 lac the party had kept the margin of 11,20,000/ . At the time of making request for revised LC of Rs.63.94 lac the party had requested to open the LC without offering any margin. While recommending the revised LC the then Branch Manager have mentioned that the party have offered fresh collateral security of Rs.30.35 lac in addition to already mortgage two properties held with the bank which were valued at Rs.79.82 lac. Regarding the past track of the party the bank Manager has also supposed it favorably..."

101 He has further deposed as follows:

".......... Today I have seen letter dated 23.7.99 the same is D63 already exhibited Ex PW13/A addressed to the Zonal Manager under the signatures of the then Chief Manager IB in which it has been specifically mentioned that permission of release of fresh LC of Rs.65 lac by the concerned branch Manager only after confirming the effective mortgage of property situated at Malviya Nagar. It was also specifically mentioned and directed tot he then concern Manager that no LC devolved and the existing over C C No.18/03 66/133 dues outstanding on account devolved LC is adjusted at the earlier."

102 He has further deposed as follows:

".......... I have seen letter dt 15.1.2000 addressed to Sr Manager Punjab & Sind Bank, Branch Office Fatehpuri Delhi issued under my signatures at point A. The same is Ex PW24/A . Though this letter it was mentioned since additional facility has been released to party without creating effective mortgage on the property situated at 26 Malviya Nagar, the account is to be closely monitored for adjustment of devolved amount and progress be submitted on fortnightly basis."

103 He has further deposed as follows:

".......... I have seen letter dated 25.10.99 addressed to Sr Manager Punjab & Sind Bank, Fatehpuri, New Delhi issued under my signatures at point A. The same is Ex PW24/E. Through this letter Manager Fatehpuri Branch was advised that one adhoc sanction which was permitted to establish import L/C for US dollar 1.48 lac on one time basis. As such he was asked to confirm that property at 26 Malviya Nagar, kept as additional security has been effectively mortgaged. He was further advised to ensure that party sticks to its promise of adjustment of its dues and no further L/C devolves on thebank. I had also advise for close monitoring of the account.

Zonal office has received a letter dated 06.12.99 issued from C C No.18/03 67/133 Fatehpuri branch, in official course of business. Photo copy of the same is Mark X. I have no personal knowledge of this letter but officially I can confirm the contents which our Zonal office had received. With the permission of Zonal office, with negative lien on property situated at 26 Malviya Nagar, New Delhi an import L/C was opened which was to the tune of US $ 147.668. It was further communicated that parties being constantly pursued for adjustment of overdue amount at the earliest but not latter than 31.01.2000 as communicated. The payment under the said L/C was due on 14.12.99. The party has assured to make the payment of L/C. Branch has also communicated that development will be informed day to day".

104 He has further deposed as follows:

"Today I have seen letter dated 09.03.2000(D66) already Exhibited as Ex. PW18/B in which the Zonal Manager was informed about the negative lien on property No. N26 Malviya Nagar has been created as reported in their letters dated 06.12.99 and 25.01.2000.

There are three type of mortgage as I understand one is legal mortgage where title of the property is mortgage through a registered deed to another person, second is equitable mortgage where property is kept under mortgage as security but title is not transfer and third is negative lien where an undertaking is taken from the party/loanee that he will not dispose of his current assets or specific property during the continuation of loan.

In this case qua property No. N26 Malviya Nagar, New Delhi, the branch Manager had taken negative lien to mortgage the property as per legal C C No.18/03 68/133 advise. As far as record shown to me Sh. Hardeep Singh had not taken permission to create negative lien in respect of this property from competent authority".

105 PW12 Iqbal Singh has deposed that negative lien does not give a right to bank to take possession of the property without the intervention of the court. Relevant portion of his deposition in this regard is as under:

"I am conversant with the rules and regulations regarding negative lien and equitable mortgage of property. Punjab and Sind Bank has issued circular in the above regard. In Negative lien the borrower give the undertaking that the assets in question is free from all encumbrances and there no charge on it. He undertakes not to dispose off the assets or create charge on it without the permission of the creditor/banker.

In Equitable mortgage the borrower or the debtor deposit the title deed of the property and whereby creates a charge over it as a security to the bank.

Negative lien does give the right to the bank to take possession of the property without the intervention of the Court but at the same time the borrower is under obligation not to dispose of the property or create any charge on it".

FACTUAL AND LEGAL ANALYSIS OF DEFENCE ARGUMENTS ON BEHALF OF ACCUSED HARDEEP SINGH 106 It is argued by Ld. Defence Counsel that in this case no C C No.18/03 69/133 preliminary enquiry has been conducted before the registration of RC which is in violation of the Rules. In support of his arguments, Ld. Defence Counsel placed reliance on Para No. 6 of Ashok Tshering Bhutia Vs. State of Sikkim, AIR, 2011 SC 1363. I have carefully gone through this authority. In the beginning of paragraph no.6, it is observed that there must be some suitable preliminary enquiry into the allegations by a responsible officer. In the end of this paragraph, it is observed as follows:

" However, as the issued is being raised first time before this Court, it is not worth further consideration. More so, the aforesaid observation do not lay down law of universal application."

107 Thus Hon'ble Supreme court in this para itself has clarify that to hold preliminary inquiry before registration of a regular case is not necessary/compulsory.

108 Hon'ble Supreme Court in Ramesh Kumari Vs State 2006 Crl L J 1622 has observed as follows:

" Criminal P.C (2 of 1974), S.154 FIR - Recording of S.154 is C C No.18/03 70/133 mandatory - Concerned officer is duty bound to register case on basis of information disclosing cognizable offence.

It is further held as follows:

" The views expressed by this Court in paragraphs 31, 32 and 33 as quoted above leave no manners of doubt that the provision of Section 154 of the Code is mandatory and the concerned officer is duty bound to register the case on the basis of such an information disclosing cognizable offence."

109 It is argued by Ld. Defence Counsel that it is absolutely wrong that accused Hardeep Singh granted the CC limit of Rs. 10 lacs and LC of Rs. 1 crore to M/s Genexx Chemicals Pvt. Ltd beyond his delegated powers. In this regard he has placed reliance on the deposition of PWs 9, 11,18 and 21. I have carefully gone through the statement of these witnesses.

110 PW9 Sh. Inderjeet Singh in his crossexamination dated 06.01.2009 has deposed as follows: "It is correct that Branch Manager of this branch had been specifically given powers as Chief Manager for granting loan. Chief Manager is of Scale IV".

111 In this regard, PW11 Sh. Jaspal Singh Kochar has deposed as follows: C C No.18/03 71/133 "Mr. Hardeep Singh, Branch Manager was working in ScaleII of bank officer Cadre. Normally an officer working in ScaleII is expected to work within the discretionary powers of scaleII vested in him. However, looking to the scope and potential of the branch, Mr. G S Duggal Branch Manager also in ScaleII, whom Sh. Hardeep Singh had succeeded in office as Branch Manager had ben specifically given discretionary power of scaleIV, i.e. Chief Manager. Likewise, Mr. Hardeep Singh was also using discretionary powers of ScaleIV". 112 In this regard, PW18 Sh. Gajender Singh in his cross examination has deposed as follows: "My statement was recorded by the CBI on 26.08.2003. I had stated to the CBI that earlier Branch Manager of Fatehpuri Branch was given SacleIV powers. I had not stated to the CBI that I was in the presumption that Hardeep Singh did not have scaleIV power but later on it came to us that Fatehpuri Branch Manager was given class IV power by CMD during 1994". 113 In this regard, PW21 Sh. Satinder Singh, IO of this case has deposed as follows: "During the investigation I found that Branch Manager was having the power of ScaleIV".

114 In view of above discussion I fully agree with the argument of Ld. Defence Counsel in this regard that accused Hardeep Singh was having powers of Branch Manager of ScaleIV.

C C No.18/03 72/133 115 It is argued by ld. Defence Counsel that there is no evidence to show that accused had hatched a criminal conspiracy to cheat the bank. In support of his arguments, Ld. Defence Counsel has placed reliance on following authorities:

P.K. Narayan Vs. State of Kerala (1995) 1 SCC 142 wherein it is held that an offence of conspiracy cannot be deemed to have been established on mere suspicion and surmises and inferences which are not supported by cogent evidence.

State of M.P Vs. Sheetal Sahai & Ors. 2009 VIII AD (SC) 630 wherein it is held that criminal conspiracy is an independent offence. It is punishable separately. Prosecution therefore, for the purpose of bringing the charge of criminal conspiracy read with the provisions of PC Act was required to establish the offence by applying the same legal principle which are otherwise applicable for the purpose of bringing criminal misconduct on the part of an accused. It is necessary to show meeting of minds of two or more persons for doing or causing to be done an illegal act by an illegal means.

116 It is argued that accused Hardeep Singh had no knowledge that C C No.18/03 73/133 the persons who have been introduced in the bank by the second man of the branch had an intention to defraud the bank and they are providing the property papers after selling the property to others. Hardeep Singh cannot be blamed if the property papers have been taken out by someone, in his absence and handed over to Sh. Jeevan Khanna. Hardepp singh also cannot be blamed, if a document has been inserted in the record behind his back. Unless there is evidence to show that the accused/Manager had knowledge of the intention on the part of Jeevan Khanna and S S Ahlawat, he cannot be said to have committed any misconduct as alleged by the prosecution. No evidence has been led by the prosecution to prove the complicity of Hardeep Singh with Jeevan Khanna and S S Ahlawat. There is also no allegation that Hardeep Singh had taken any bribe in the entire transaction. Till date there is no evidence showing any pecuniary gain to Hardeep Singh. Prosecution has failed to prove any wrongful loss to the bank or any wrongful gain attained by the accused Hardeep Singh. Prosecution has also failed to prove any abuse of official position by Hardeep Singh. There is positive evidence that Hardeep Singh is a hardworking, honest and sincere bank official and no one has ever received any complaint against him. 117 With regard to appreciation of circumstantial evidence C C No.18/03 74/133 and its sufficiency in a criminal conspiracy of committed cheating, combined effect of all the proved facts taken together for establishing the criminal conspiracy conclusively in this regard it is held by Hon'ble Supreme Court in State of AP Vs. IBS Prasada Rao & Ors AIR 1970 SC, 648: "(A) Evidence Act (1 of 1872), S.3 - Criminal P.C. (5 of 1898), S.367 - Penal Code (45 of 1860), S.120B, S.419 and S.420 - Appreciation of evidence - Circumstantial evidence, sufficiency of - If combined effect of all proved facts taken together is conclusive in establishing guilt of accused, conviction would be justified even though anyone or more of these facts by itself is not decisive - Held on facts and circumstances that charges under Sections 120B and 420, IPC have been established against all the four accused and under Section 419, IPC against accused No. 3". 118 In this regard in Ram Avtar Gupta V. Gopal Dass AIR 1983 SC 1149 Hon'ble Supreme Court has held as follows: "Where a criminal prosecution under Ss.420, 467,468,34 and 120 B, IPC., launched by the carriers of a consignment against the partners of the consignee firm on the ground that by misrepresentation and deceit the partners of the consignee firm induced the carriers to deliver the consignment to them without retiring the transport receipt from the bank and without making payment to the Bank as required by the contract was quashed by the High Court on C C No.18/03 75/133 feeling that the consignee had later on in three installments paid both the freight and the price and as such it was a case of mere delay in discharge of monetary liability which need not necessarily amount to dishonest intention on their part, but it was found that the carriers had in fact settled all the dues of the consignors and the consignees even after getting delivery of the consignment from the carriers allegedly by making misrepresentation and practising deceit have failed to make good a substantial part of the price of the goods the order of the High Court was quashed by Supreme Court".

119 Conspiracy consists in a combination or agreement between two or more person to do an unlawful act or to do a lawful act by unlawful means. A conspiracy is an inference drawn from the circumstances. There cannot always be much direct evidence about it. Conspiracy can be inferred even from the circumstances giving rise to a conclusive or irresistible inference of an agreement between two or more persons to commit an offence. Since Conspiracy is often hatched up in utmost secrecy, it is most impossible to prove conspiracy by direct evidence. It has to be inferred from the acts, statements and conduct of parties to the conspiracy. Thus, if it is proved that the accused pursued, by their acts, the same object often by the same means, one performing one part of the act and the other another part of the same act so as to C C No.18/03 76/133 complete it with a view to attainment of the object which they were pursuing, the court is at liberty to draw the inference that they conspired together to effect that object. Conspiracy has to be treated as a continuing offence and whosoever is a party to the conspiracy, during the period for which he is charged, is liable under this section.

120 It is not an ingredient of the offence under this section that all the parties should agree to do a single illegal act. It may comprise the commission of a number of acts. The entire agreement must be viewed as a whole and it has to be ascertain as to what in fact the conspirators intended to do or the object they want to achieve. It is not necessary that each member of conspiracy must know each other or all the details of the conspiracy. It is also not necessary that every conspirator must have taken place in each and every act done in pursuance of a conspiracy.

121 Though to establish the charge of conspiracy there must be agreement, there need not be proof of direct meeting or combination , nor need the parties be brought into each other's presence; the agreement may be inferred from the circumstances raising presumption of a common concerted plan to carry out the unlawful design. Conspiracy need not be established by proof which actually brings the party together; but may be shown like any other fact, by circumstantial evidence. So again it is not necessary that all should have joined in the scheme from the first point; those who come in at a later stage are equally guilty. C C No.18/03 77/133 122 Conspiracy hatched in secrecy and executed in darkness. In a case of conspiracy, it is not expected from the prosecution that it will produce evidence to show that conspirators executed agreement to commit crime before the witnesses to prove the existence of conspiracy. Conspirators take all precautions to keep their plan secret hence prosecution cannot produce direct evidence to prove agreement to commit conspiracy.

123 In Kher Singh Vs State AIR 1988 SC 1883 it is observed as follows:

" Generally, a conspiracy is hatched in secrecy and it may be difficult to adduce direct evidence of the same. The prosecution will often rely on th evidence of acts of various parties to infer that they were done in reference to their common intention. The prosecution will also more often rely upon the circumstantial evidence. The conspiracy can be undoubtedly proved by such evidence direct or circumstantial. But the Court must require whether the two persons are independently pursuing the same end or they have come together to the pursuit of the unlawful object. The former does not render them conspirators, but the later does. It is however, essential that the offence of conspiracy required some kind of physical manifestation or agreement the express agreement however need not be proved. Nor mutual meetings of the two persons is necessary. Nor it is necessary to prove the actual words of communication. The evidence as to transmission of thoughts C C No.18/03 78/133 sharing the unlawful design may be sufficient. Conspiracy can be proved by circumstances and other material."

124 In a case of criminal conspiracy any evidence available against any of the accused is admissible against all the accused. Once a conspiracy is proved among the accused, act of one conspirator become act of all other conspirators also. In this regard Ld. SPP placed reliance on Shiv Narain Laxmi Narain Joshi Vs State of Maharashtra, (1980 ) 2 Supreme Court Cases 465 has held as follows:

" Penal Code, 1860 Section 120B - Since it is impossible to adduce direct evidence of conspiracy, the offence can only be proved largely from the inference drawn from acts or illegal omissions committed by the conspirators in pursuance of a common design Once such a conspiracy is proved, act of one conspirator becomes act of the other A coconspirator, who joins subsequently and commits overt acts in furtherance of the conspiracy, held is also liable Evidence Act, 1987 Section 10."

125 Hon'ble Supreme Court in Firozuddin Basheeruddin & Ors. Vs. State of Kerala, (2001) 7 Supreme Court Cases 596 has held as follows:

"Conspiracy is not only a substantive crime but on the basis of it a conspirator can also be held liable for the crimes committed by conspirators in furtherance of the objectives of the conspiracy Conspiracy can be established on the basis circumstances C C No.18/03 79/133 evidence As regards admissibility of evidence strict standards are not necessary inasmuch as any declaration made by a conspirator in furtherance of and during pendency of a conspiracy though hearsay, is admissible against each co conspirator On facts held, Supreme Court's interference with concurrent finding that criminal conspiracy proved and on the basis offence of murder also made out not called for."

126 Hon'ble Supreme Court in Ram Naryan Popli Vs. CBI AIR 2003, SC 2748 has held as follows:

"The essential ingredient of the offence of criminal conspiracy is the agreement to commit an offence. In a case where the agreement is for accomplishment of an act which by itself constitutes an offence, then in that event no overt act is necessary to be proved by the prosecution because in such a situation, criminal conspiracy is established by proving such an agreement. Where the conspiracy alleged is with regard to commission of a serious crime of the nature as contemplated in Section 120B read with the proviso to sub Section (2) of Section 120A, then in that event mere proof of an agreement between the accused for commission of such a crime alone is enough to bring about a conviction under Section 120B and the C C No.18/03 80/133 proof of any overt act by the accused or by any one of them would not be necessary."

127 Hon'ble Supreme Court in P K Narayan Vs. State of Kerala, All India Criminal Law Reporter 1994 (3) 785, has held as follows:

"Penal Code, 1860, Section 120B Evidence Act, 1872, Section 3 - Criminal Conspiracy Essence of Criminal conspiracy - It is an agreement to do an illegal act - Agreement can be proved either by direct evidence or by circumstantial evidence or by both

- Complicity of the accused - Circumstances proved before, during and after the occurrence required to be considered to decide about the complicity of the accused But if the circumstances are compatible with the innocence of the accused persons then it could not be held that the prosecution had successfully established its case."

128 Hon'ble Supreme Court in S. Swamirathnam, Appellant Vs. State of Madras, Respondent, (s) AIR 1957 S.C. 340 in this regard has held as follows:

"If a specific instance of cheating was proved beyond C C No.18/03 81/133 doubt against any of the accused that would furnish the best corroboration of the offence of conspiracy because conspiracy was the root and the specific instances were the fruit."

129 In the case in hand accused Jeevan Khanna had initially filed forged/fabricated Roznamcha entry No. 634 PW10/1 dated 20.12.97 , which was accepted by accused Hardeep Singh. He had also accepted property of accused Shamsher Singh as collateral security which was purchased by him on 19.3.96 vide Sale deed Ex PW1/B in consideration of Rs.2,03500/ in Roznamcha entry No.634 PW10/A dated 20.12.97 its value has been shown as 80 lacs . This property was purchased on 19.3.96 in a sum of Rs. 2,03,500/, its value cannot be increased by 39 folds within a period of about one and half year by any stretch of imagination. It proves that accused Jeevan Khanna was acting from the very beginning in connivance and conspiracy with his co accused Hardeep Singh, who had blindly accepted the valuation report of this property and Roznamcha Entry 634 Ex PW10/A, moreover bank had sanctioned credit limit of Rs.110 lacs but in the above referred Roznamcha lien mark for Rs.80 lacs only. Accused Hardeep Singh should have confirmed from the concerned authority in this regard before disbursement of the loan. which again proves his involvement in criminal conspiracy with his coaccused to cheat C C No.18/03 82/133 the bank.

130 It is also proved on the record that accused Shamsher Singh Ahlawat executed Form 84 AA ( D16) and Equitable Mortgage was created on 02.03.1998( D75) by bank by receiving sale deed of said property. Sh. Shamsher Singh Ahlawat had already sold 4 bigha land to Sh. D N Verma and Madhvi Verma on 20.03.1996 vide sale deed dated 20.03.1996(D2) and (D6). Accused Shamsher Singh Ahlawat dishonestly and fraudulently handed over/deposited the original sale deed dated 19.03.96(D25) executed by Sh. Nathi in his favour in bank, whereas he fully knows that he had already sold 8 bigha and 16 biswa land to other persons and thereby helped Jeevan Khanna in furtherance of the criminal conspiracy in connivance with Hardeep Singh to cheat the bank and caused wrongful pecuniary gain to accused Jeevan Khanna and wrongful loss to the bank. 131 At the time of enhancement of loan facilities, accused Jeevan Khanna had created equitable mortgage of his property bearing plot No. 683, Sector 3132A, Urban Estate, Gurgaon. The said property was purchased by Jeevan Khana from Smt. Suneet Prabha Arora W/o Satpal Arora on 10.04.98 and the said plot was transferred in the name of Jeevan Khanna on 13.05.98. Further Jeevan Khanna applied C C No.18/03 83/133 in Estate Office HUDA to grant necessary permission to sell the same plot on 02.11.98. Estate Office HUDA granted necessary permission to Jeevan Khanna vide their letter No. 4094 dated 03.11.98 and Jeevan Khanna sold the said plot to Sh. Sunil Kumar Gupta R/o C109, Raj Nagar, Pitampura, New Delhi on 01.12.98 and the said plot was transferred in the name of Shri Sunil Kumar Gupta on 31.12.98.

132 From the above discussion it is proved that accused Jeevan Khanna was having dishonest intention to cause wrongful loss to the bank and wrongful gain to himself from the very beginning when he had deposited the forged and fabricated Roznamcha entry no. 634 with the bank along with the title deed of the property of accused Shamsher Singh as collateral security, major part of which was already sold. Dishonest intention of accused Jeevan Khanna is also proved at the time of enhancement of the sanction limit when he had furnished the additional collateral security of property No. 683, Sector 3132A, Urban Estate, Gurgaon which was already sold by him to Sh. Sunil Kumar Gupta.

133 From the above discussion prosecution has proved beyond reasonable doubt that accused Hardeep Singh, Jeevan Khanna and C C No.18/03 84/133 Shamsher Singh were acting in connivance with each other and involved in this criminal conspiracy and they have cheated the bank in furtherance of criminal conspiracy in collusion with each other . 134 It is correct that there is no evidence on the file that accused Hardeep Singh had obtained any pecuniary gain for himself. However, it is apparent that accused Hardeep Singh by his act and conduct and in connivance with his coaccused Jeevan Khanna and Shamsher Singh had obtained pecuniary advantage for accused Jeevan Khanna abusing his official position . Obtaining pecuniary gain/ advantage for himself is not the only ingredient of Section 13 (1) (d) of P C Act 1988 . If an accused by corrupt and illegal means, or abusing his official position obtains pecuniary gain for his co accused or any other person even then he is liable to commit an offence defined U/S 13 (1) (d) of P C Act 1988. In these circumstances, there is no merit in this arguments. 135 Title deed of property bearing Plot No. 683 Sector 3132A U.E Gurgaon was firstly deposited while enhancement of limit on 24.8.98 . Thereafter , accused Jeevan Khanna in form No.84AA has again mentioned furnishing of this property as collateral security with regard to opening of L C on 25.1.99 and on 8/9.6.99. Accused C C No.18/03 85/133 Hardeep Singh in his own writing made entry with regard to obtaining of title documents of plot bearing No.683 Sector 3132A U.E Gurgaon. PW20 Dalbir Singh has proved that when he had taken over charge of the branch from his predecessor Sh Hardeep Singh original title deed of Property No. 683 Sector 3132A U.E Gurgaon was not available in the bank record which he has also mentioned in his charge report Ex PW20/A . Accused Hardeep Singh has neither made any complaint to his Senior Officer nor lodged any police report etc with regard to the alleged removal of original title deed of Property No. 683 Sector 3132A U.E Gurgaon . In these circumstances, this defence of accused that some one had taken out original title deed in his absence and handed over the same to Jeeven Khanna, appears to be afterthought and merit less. ROLE OF ACCUSED SHAMSHER SINGH AHLAWAT.

136 According to prosecution accused Shamsher Singh in conspiracy with Jeevan Khanna and Hardeep Singh fraudulently mortgaged his property situated at Rojka Gujar, Tehsil Sohna, Gurgaon, i.e. 10 bigha and 13 biswa on 02.03.1998 and 25.01.1999 against the loan availed by M/s Genex Chemicals Pvt. Ltd. He C C No.18/03 86/133 fraudulently executed form no. 84AA regarding mortgage of property at Punjab and Sind Bank, Fatehpuri Branch, Delhi. 137 Accused Shamsher Singh Ahalawat purchased land measuring 10 bigha and 13 biswa situated in village Rojka Gujar, Tehsil Sohna, Gurgaon from Nathi Singh on 19.3.96. On the very next day i.e. 20.3.96 Shamsher Singh sold 4 bigha out of this piece of land to D N Verma and Smt. Madhvi Verma for a consideration of Rs.1 lac. Subsequently he further sold another 4 bigha and 16 Biswa out of the same piece of land to Sandeep Malik and Mandeep Malik on 2.8.06 for a consideration of Rs.2.2 lacs. When Shamsher Singh submitted original sale deed of the said land in the bank on 2.3.98 for creation of Equitable Mortgage in favour of the bank, whereas more than 75% of the total land was already sold by him to other persons. One bigha and 17 biswa out of the same piece of land was sold on 7.10.98 to K M Rajni d/o Hari Kishan for a consideration of Rs.40,500/. 138 Accused Shamsher Singh Ahalawat also signed Form No. 84 AA in respect of property situated at village Rojka Gujar, Tehsil Sohna, Gurgaon knowingly that he was not the owner of the said property on that date and had no lawful authority to execute the same. He also signed form No.255 (Guarantee bond).

C C No.18/03 87/133 EVIDENCE PRODUCED BY THE PROSECUTION AGAINST ACCUSED SHAMSHER SINGH AHALAWAT 139 PW1 Gopi Chand had proved that Shamsher Singh Ahlawat purchased land measuring 10 bigha 13 biswa from Shri Nathi vide sale deed ated 19.03.96, Ex. PW1/B. He also proved that Shamsher Singh Ahlawat sold land measuring 4 bigha to Madhvi Verma and D N Verma vide sale deed dated 20.03.96, Ex. PW1/C. He also proved that Shamsher Singh Ahlawat sold land measuring 4 bigha 16 biswa to Sandeep Malik and Mandeep Malik on 02.08.96 vide sale deed dated 02.08.96, Ex. PW1/D. He also proved that Shamsher Singh Shalawat sold land measuring 1 bigha 17 biswa to Kr. Rajni vide sale deed dated 07.10.98, Ex. PW1/E. 140 PW2 Sh. D N Verma also proved that Shamsher Singh ahlawat sold land measuring 4 bigha to him and his daughter Madhvi Verma vide sale deed dated 20.03.96, Ex. PW1/C. 141 PW4 Kr. Rajni Gupta proved that Shamsher Singh Ahlawat sold land measuring 1 bigha 17 biswa to her vide sale deed dated 07.10.98, ExPW1/E. C C No.18/03 88/133 142 PW8 Sh. R.K. Nagra proved that credit facility, i.e. working capital of Rs. 10 lacs and Import LC of Rs. 100 lacs was sanctioned to M/s Genex Chemicals Pvt. Ltd. against the stock in trade and equitable mortgage of property of accused Shamsher Singh Ahlawat measuring 10 bigha 13 biswa on 28.02.98. He proved that accused Shamsher Singh Ahlawat executed form No. 84AA regarding mortgage of his property against the loan granted to M/s Genex chemicals Pvt. Ltd. On 02.03.98 ( Ex. PW8/A).

143 PW9 Sh. Inderjeet Singh had proved that credit facility, i.e. working capital of Rs. 25 lacs and Import LC of Rs. 70 lacs( usance 90 days) was sanctioned to M/s Genex Chemicals Pvt. Ltd. against the stock in trade and equitable mortgage of property of accused Shamsher Singh Ahlawat measuring 10 bigha 13 biswa on 28.02.98. He proved that accused Shamsher Singh Ahlawat executed form No. 84AA regarding mortgage of his property against the loan granted to M/s Genex Chemical Pvt. Ltd. on 02.03.98 (Ex. PW9/25). 144 Shamsher Singh Ahlawat executed form 84AA Ex. PW9/25 (D81) on 25.01.99 by signing at point Q12 and Q13. PW26 T. Joshi, GEQD in his report has opined that signatures at point Q12 & C C No.18/03 89/133 Q13 are of accused Shamsher Singh. Description of the property furnished for collateral security is mentioned at Sr. No. 1 which is of sale deed dated 19.03.96 executed and registered in the office of Sub Registrar, Sohna, Gurgaon. Its estimated value is mentioned as Rs. 65,61,000/.

145 PW9 Inderjeet Singh has corroborated the fact that accused Shamsher Singh had executed form no. 84 AA (D81) ( Ex.PW9/25) and signed the same in his presence. Relevant portion of his deposition in this regard is as under:

" I have seen the form no. 84AA(D81), which is signed by accused Shamsher Singh at my presence. The encircled portion is Ex. PW9/25(Objected to).

146 Prosecution has proved form no. 84AA, Ex. PW8/A (D13) executed by him in favour of bank on 03.03.98 vide which Shamsher Singh had stood guarantor and deposited the sale deed dated 19.03.96 registered in the office of SubRegistrar, Sohna, Gurgaon of land measuring 10 bighas situated in village Sivana, Rojka Gujjar, Tehsil Sohna, Distt Gurgaon, Haryana. Value of the land is shown as Rs. 65,61,000/ as per valuation dated 01.03.98. These particulars are C C No.18/03 90/133 mentioned in the handwriting of bank officer Sh. Raj Kumar Nagra, who has been produced in the witness box by the prosecution as PW8. He has specifically deposed in his examination in chief recorded on 09.05.2008 that the details of property mentioned in form no. 84AA Ex. PW8/A (D13) are in his handwriting. These are the property details of accused Shamsher Singh. Shamsher Singh has signed it at point A on Ex. PW8/A in his presence. He has identified signatures of Shamsher Singh at point A. 147 This witness has been crossexamined at length on behalf of accused Shamsher Singh. Even in his crossexamination, he has reconfirmed that the signatures at point A on Ex. PW8/A is of Shamsher Singh. His entire crossexamination on behalf of accused Shamsher Singh is as under:

" I did not mention the nature of the property in column no. 5 of Ex. PW8/B, however, this is mentioned in form no. 84AA Ex. PW8/A, signatures at point A on Ex. PW8/A is that of accused Shamsher Singh Ahlawat. It is incorrect to suggest that signatures at point A is not of accused Shamsher Singh Ahlawat. Address below signature at point A is in my hand on being furnished by the parties. I cannot say as to what documents/proof is required to be seen before accepting the address declared by the mortgager. First we prepare the appraisal note then we prepared form no. 84AA. Description of security as prescribed in appraisal form in column no. 5 were not given by me as the same C C No.18/03 91/133 was mentioned in Ex. PW8/A. Again said Ex. PW8/A and Ex. PW8/B simultaneous. Since Valuation Report was not received till preparation of Ex. PW8/B by me. I have not mentioned the value of the property column no. 5 of my appraisal. I had ticked against the column of clear title and free from emcumbrance on asking of somebody. I never made any enquiry from accused Shamsher Singh Ahlawat. However, we used to see the Valuation Report. It is correct that report regarding value clear, title and free from emcumbrance have been received by me. It is correct that I have not incorporate those information in my process note Ex. PW8/B. All these details are mentioned in form no. 84AA. Above three information are not available in Ex. PW8/A. I was not having knowledge as my seniors had said, hence I mentioned. It is incorrect to suggest that accused Shamsher Singh never visited me and gave any title deed and it was submitted by the Loanee".

148 It is correct that handwriting expert has not given any opinion on the signatures of accused Shamsher Singh at point Q1 on Ex. PW8/A, but it is also clear that handwriting expert has not given any negative opinion that signatures at point Q1 are not that of accused Shamsher Singh Ahlawat. When PW8 Raj Kumar Nagra has specifically deposed that accused Shamsher Singh had signed at point A on Ex. PW8/A in his presence and has also reconfirmed it in his crossexamination that signatures at point Q1 on Ex. PW8/A are of accused Shamsher Singh, in these circumstances, there is no reason to draw any adverse inference against the signatures of Shamshe C C No.18/03 92/133 Singh at point Q1 on Ex. PW8/A. 149 Shamsher Singh Ahlawat executed form 255(revised) Ex. PW9/28 (D31) on 25.01.99 by signing at point Q2, Q3, Q4 and Q5. PW26 T. Joshi, GEQD in his report has opined that signatures at point Q2, Q3, Q4 and Q5 are of accused Shamsher Singh. Vide this document, accused Shamsher Singh has agreed to open/continue to be the guarantor and has furnished his property as collateral security to indemnify the liability of the borrower. Along with this document a stamp paper of Rs. 10 is also attached, which was purchased on 29.12.1999 as per stamp affixed on the back of same. It also bears signatures of accused Shamsher Singh at point Q6 & Q7. PW26 T. Joshi, GEQD in his report has opined that signatures at point Q2, Q3, Q4 and Q5 are of accused Shamsher Singh, which also proved that he has purchased the stamp paper from the stamp vendor after signing the court fees in this stamp paper for executing form No. 255 (revised) in the bank on 25.01.1999. The fact that the stamp paper annexed with form no. 255 (revised) is dated 29.12.1999 while revised form No. 255 Ex. PW9/28 was executed on 25.01.99. 150 PW9 Inderjeet Singh has corroborated the fact that accused Shamsher Singh had executed form no. 255(revised)(D31) C C No.18/03 93/133 ( Ex.PW9/28) and signed the same in his presence at point A to D. Relevant portion of his deposition in this regard is as under:

" I have seen the form no. 255(revised), which is in the handwriting of accused Shamsher Singh, Guarantor in respect of LC and CC limit and signed by accused Shamsher Singh at point A to D in my presence. The same is Ex. PW9/28."

151 Description of the property furnished for collateral security is mentioned at Sr. No. 1 which is of sale deed dated 19.03.96 executed and registered in the office of SubRegistrar, Sohna, Gurgaon. Its estimated value is mentioned as Rs. 65,61,000/. 152 PW8 Sh. Raj Kumar Nagra has deposed that entry in Ex. PW8/U from point C to C with regard to depositing of property papers of 10 bighas and 12 biswa in the name of Shamsher Singh is in his handwriting and it bears signatures of accused Hardeep Singh at point D. Relevant portion of his deposition in this regard is as under:

" I have seen title deed register(D75) maintained in our Fatehpuri Branch. I made entry at page 41, in this register regarding the deposit of the property papers of 10 bighas, 12 biswa in the name of Shamsher Singh. I identify my writing at point C to C and signature of Hardeep Singh at point D. C C No.18/03 94/133 The same is Ex. PW8/U".

153 PW7 Sh. Rajender Pal Singh has deppsed that he had prepared the enhancement loan proposal of M/s Genexx Chemicals Pvt. Ltd. ( D40) Ex. PW7/A, as per instructions of Branch Manager, Hardeep Singh. When this proposal of enhancement was prepared equitable mortgaged of property measuring 10 bighas and 13 biswa in the name of Shamsher Singh was already mortgaged and additional equitable mortgage of property no. 683, Sec31, 32A, U.E, Gurgaon has been mortgaged. Relevant portion of his statement is as under:

" I have seen the enhancement loan proposal of M/s Genexx Chemicals Pvt. Ltd. (D40). I had prepared this proposal as per the instructions of the then Manager Sh. Hardeep Singh. This proposal is in my handwriting containing four sheets, I identify my writing on each sheet of the proposal. The proposal is Ex. PW7/A. I identify the signatures of Hardeep Singh, the then Manager at point A on page no. 8( last sheet). Vide this proposal the CC limit of M/s Genexx Chemicals Pvt. Ltd. Has been enhanced from 10 lacs to 25 lacs and LC limit has been reduced from 1 crore to 70 lacs. Mr. Jeevan Khanna, Sh. Prateek Ratra and Sh. Sanjay Sachdeva were the Directors when the enhancement proposal was prepared. When the proposal was prepared the equitable mortgaged of the property measuring 10 bigha, 13 biswa in the name of Shamsher Singh was already mortgaged with the bank and additional equitable mortgaged of the property measuring 177.6 sq. Yards, plot no. 683, Sec31, 32A, Urban Estate, Gurgaon has been mortgaged.

C C No.18/03 95/133

I have seen the sanction order dated 24.08.98( D58). I have prepared this sanction order, which is in my handwriting. The sanction order is Ex. PW7/B. I identify the signatures of Sh. Hardeep Singh on the sanction order at point A and B. This sanction order was prepared in pursuance of the proposal Ex. PW7/A. The writing in red ink on sanction order is in the handwriting of Sh. Hardeep Singh. Vide this sanction order Rs. 70 lacs as LC limit and Rs. 25 lacs as CC limit have been sanctioned to M/s Genexx Chemicals Pvt. Ltd. When I prepared the enhancement proposal Ex. PW7/A, the property of Shamsher Singh Ahlawat was already mortgaged with the bank".

154 From the above discussion, it is proved beyond reasonable doubt that accused Shamsher Singh fraudulently and dishonestly mortgage land measuring 10 bighas against the credit facilities sanctioned to M/s Genexx Chemicals Pvt. Ltd. On 02.03.98, out of which he had already sold 8 bighas 16 biswa. He had again fraudulently and dishonestly mortgaged the same property on 25.01.1999 against the enhanced credit facilities sanctioned to M/s Genexx Chemicals Pvt. Ltd.

FACTUAL AND LEGAL ANALYSIS OF DEFENCE ARGUMENTS ON BEHALF OF ACCUSED SHAMSHER SINGH AHLAWAT .

C C No.18/03 96/133 155 It is argued by Ld. Defence Counsel that the accused Shamsher Singh Ahlawat is innocent, has committed no offence and has been framed in the case to provide a missing link in the prosecution case in which the prosecution has miserably failed from evidence presented by themselves.

156 Accused Shamsher Singh Ahlawat is connivance with Jeevan Khanna and Hardeep Singh offered/mortgaged his property situated at Rojka Gujjar against the credit facilities, i.e. CC ( Book Debts) Rs. 10 lacs and letter of credit Rs. 100 lacs sanctioned to M/s Gennex Checicals Pvt. Limited by Punjab and Sind Bank, Fatehpuri Branch during February, 1998. Accused Shamsher Singh Ahlawat fraudulently executed Form 84 AA ( D16) and Equitable Mortgage was created on 02.03.1998( D75) by bank by receiving sale deed of said property Sh. R.K. Nagra ( PW8) had proved the same in his deposition. Sh. Shamsher Singh Ahlawat had already sold 4 bigha land to sh. D N Verma and Madhvi Verma on 20.03.1996 vide sale deed dated 20.03.1996(D2) and (D6). Accused Shamsher Singh Ahlawat dishonestly and fraudulently handed over/deposited the original sale deed dated 19.03.96(D25) executed by Sh. Nathi in his favour in bank, whereas he fully knows that he had already sold 8 bigha and 16 biswa land to other persons and thereby helped sh. C C No.18/03 97/133 Jeevan Khanna and Hardeep Singh to cheat the bank and caused pecuniary benefit to themselves. Km. Rajni ( PW4) clearly stated in her deposition that she purchased the land from Shamsher Singh Ahlawat through Ex. PW4/E. The said facilities were enhanced, to Rs. 25 lacs and Letter of credit Rs. 70 lacs in August, 1998, however the same released in January, 1999 against the equitable mortgage of Shamsher Singh property situated at Rojka Gujjar, Sohna, Gurgaon ( which is already mortgaged with bank) and plot no. 683, Sector 31 32A, Urban Estate, Gurgaon in the name of Sh. Jeevan Khanna. All the director of M/s Genexx Chemicals Pvt. Ltd. executed fresh loan documents as guarantors/borrower. Sh, Shamsher Singh Ahlawat also executed fresh 84AA, as amount of credit facilities sanctioned to M/s Genexx Chemicals have been changed. However the original property docuemnts of Shamsher Singh ahlawat were already with bank and no entry was made in the Equitable Mortgage Register. Entry of Equitable mortgage of Jeevan Khanna property had been made in the equitable Mortgage resiger( D75). But the same is not available in the bank.

157 It is argued by Ld. Defence Counsel that the only allegation against the accused is that he allegedly stood as Guarantor and he offered his land as collateral security concealing the fact that the land C C No.18/03 98/133 offered through submission of a registered sale deed stood already sold. This allegation of becoming guarantor and offering collateral security is in respect of some loan and other credit facilities granted to M/s Genexx Chemicals Pvt. Ltd. Owned by coaccused Jeevan Khanna to whom as per allegations the Punjab and Sind Bank Ltd. Allegedly favoured through his Manager Hardeep Singh of Fatehpuri Branch.

158 Accused Sh. Shamsher Sigh Ahlawat in conspiracy with Jeevan Khanna and Hardeep Singh fraudulently offered/mortgaged his property situated at Rojka Gujjar against the credit facilities, i.e. CC ( Book debts) Rs. 10 lacs and Letter of credit Rs. 100 lacs sanctioned to M/s Genex Chemicals Pvt. Ltd. By Punjab and Sindh Bank, Fatehpuri Branch during February, 1998. Sh. Shamsher Singh Ahlawat fraudulently executed form 84 AA ( D16) and equitable mortgage was created on 02.03.1998 by bank (D75) . Sh. R.K. Nagra ( PW8) had proved the same in his deposition. Since the property offered by Shamsher Singh Ahlawat to bank has already been disposed off by Shamsher Singh Ahlawat and in conspiracy with Jeevan Khanan and Hardeep Singh cheated Punjab & Sind Bank. 159 It is argued by Ld. Defence Counsel that the most relevant C C No.18/03 99/133 witnesses against the accused are PW8 and PW9 who has badly contradicted themselves and also exposed the falsities of allegation against the accused whereas PW 8 says that for number 84AA was got executed by him in March 1998 by which time the valuation report from Panel Advocate of the bank was not received. The sale deed in original according to PW8 was allegedly submitted by the accused and the sale deed was dated March1996 and in March 1998, the valuation of the land is being shown as Rs. 65 lacs few thousands. When Sale deed in original is available the consideration amount on which the land was purchased must be in the sale deed and therefore and high claim than that could not have been possibly entertained by the bank.

160 Accused Shamsher Singh Ahlawat is trying to mix up the matter. Punjab and Sind Bank sanctioned the credit facilities of CC ( Book debts) Rs. 10 lacs and Letter of credit Rs. 100 lacs sanctioned to M/s Genex Chemicals Pvt. Ltd by Punjab and Sindh Bank, Fatehpuri Branch during February, 1998 against property of Shamsher Singh Ahlawat situated at Rojka, Gujjar, Tehsil Sohna, Gurgaon, Haryana. Accused Shamsher Singh Ahlawat executed form 84AA and submitted the sale deed of the property of Rojka Gujjar to bank. Equitable mortgage in this regard was created in bank C C No.18/03 100/133 by receiving the sale deed of said property and entry of the same mentioned in the Equitable Mortgage Register ( D75).The same facts have been proved by Sh. R.K. Nagra( PW8) in his deposition. The said facilities were enhanced Rs. 25 lacs and letter of credit Rs. 70 lacs on the request of Jeevan Khanna in August, 1998 against the equitable mortgage of accused Shamsher Singh property situated at Rojka Gujjar, the Sohna, Gurgaon which is already mortgaged with bank and plot no. 683, Sector 3132A, Urban Estate, Gurgaon, however the same facilities were released in January, 1999. All the directors of M/s Genex Chemicals Pvt. Ltd. Executed the loan documents as guarantor/borrowers. Shamsher Singh Ahlawat also executed fresh 84AA ( D81) as amount of credit facilities sanctioned to M/s Genex Chemicals have been changed. However, the original property documents of Shamsher Singh Ahlawat was already with bank, hence no entry was made in the Equitable Mortgage Register at this time. The same facts have been stated by PW9 in his deposition. 161 It is argued by Ld. Defence Counsel that in the charges framed, it is clearly mentioned that the accused had offered land for mortgage by submitting the sale deed in question when major portion of the land stood sold. There are two form of 84AA. One is indicated as PW8/A which is of March 1998 and the other is January 1999 which C C No.18/03 101/133 is Ex. PW9/25. The prosecution failed to explain as to which one is the correct declaration inform 84 AA. If the sale deed was deposited in March 1998, was it returned to the accused Shamsher Singh without loan having been liquidated otherwise how the same sale deed could have been possibly redeposited or deposited in January 1999.

162 Accused Shamsher Singh Ahlawat is trying to mix two instances. As stated in above paras first 84AA ( D13) was executed by Shamsher Singh Ahlawat on 03.03.1998.When credit facilities, Rs.10 lacs and letter of credit Rs. 100 lacs sanctioned to M/s Genex Chemicals Pvt. Ltd. By Punjab and Sind Bank, Fatehpuri Branch during February, 1998. The amount mentioned in the said form is Rs. One crore. The said facilities were enhanced Rs. 25 lacs and Letter of credit Rs. 70 lacs on the request of Jeevan Khanna in August, 1998 against the equitable mortgage of Shamsher Singh property situated at Rojka Gujjar, the Sohna, Gurgaon which is already mortgaged with bank) and plot no. 683, Sector 3132A, Urban Estate, Gurgaon, however the same facilities were released in January, 1999. All the directors of Genex Chemicals Pvt. Limited executed the loan documents as guarantor/borrowers. Accused Shamsher Singh Ahlawat also executed fresh 84AA(D81) as amount of credit facilities sanctioned to M/s Genex Chemicals have been C C No.18/03 102/133 changed. In the said form sanctioned amount was mentioned as CC Rs.25 lacs and LC Rs. 70 lacs. However, the original property documents of Shamsher Singh Ahlawat was already with bank, hence no entry was made in the Equitable Mortgage Register at this time. If the accused had not executed the fresh form 84AA, the same would create problem to bank in further proceedings, if loanee and guarantor failed to repay the loan.

163 It is argued by Ld. Defence Counsel that the CBI had produced palpably false and liar witnesses against the accused and their statement makes the case false and fabricated against the accused . PW 9 in examination in chief had stated on oath " I have seen the form No. 84AA ( D81) which is signed by accused Shamsher Singh at point A in my presence. The enclosed portion is Ex. PW9/25". In cross examination by the counsel on behalf of accused Shamsher Singh, he has admitted that he has not seen the original documents of the property. He has further stated that he cannot say as to who had filled in Ex. PW9/25. He has stated that he did not know Shamsher Singh and prior to 25/1/99 and that the Branch Manager (coaccused Hardeep Singh) had introduced Shamsher Singh and in the last witness PW9 has admitted on oath said "It is correct that in C C No.18/03 103/133 connection with sanction of limit loan involved in this case neither Shamsher Singh came in the bank before me nor he has signed any document before me". There can be no serious lie than this when in examination in chief he admits that accused Shamsher Singh signed in his presence and in cross he gives a clean goodbye to his previous statement that Shamsher Singh never came to Bank before him nor he signed any document before him. This shows the falsity of the CBI witnesses against the accused.

164 There is clear cut case against accused Shamsher Singh Ahlawat. PW9 Inderjett Singh had clearly deposed in his statement that form no. 84AA ( PW9/25) was executed by Shamsher Singh Ahlawat in his presence. The original documents had already been submitted by Shamsher Singh Ahlawat vide form No. 84AA dated 03.03.1998 against the facility of CC (Book debts) Rs. 10 lacs and Letter of credit Rs. 100 lacs and entry of receipt of sale deed was made in the Equitable Mortgage Register ( D75) by PW8 Sh. R.K. Nagra. Since the property papers were with the bank as on 25.01.99, PW9 did not see the same as he did not receive the same. Signing of the said document is also established by GEQD opinion. Sh, Inderjeet Singh had clearly stated in crossexamination by accused Shamsher Singh Ahlawat that " It is incorrect to suggest that C C No.18/03 104/133 signatures at point A on Ex. PW9/25 is not of Shamsher Singh". 165 It is argued by Ld. Defence Counsel that at least from the statement of PW1, it is clear that till March 1998 the accused had sold only 8 Bighas and 16 Biswas out of the land of which sale deed was allegedly submitted in the bank and therefore, when the sale seed was for the purchase of 10 Bighas and 13 Biswas clearly about two Bighas was with the accused Shamsher Singh. One Bigha and 17 Biswas was later on sold on 07.10.1998.

166 Accused Shamsher Singh Ahlawat had already sold 4 bigha lands to Sh. D N Verma and Madhvi Verma on 20.03.1996 vide sale deed dated 20.03.1996 ( D2) and ( D6). Sh. D N Verma, PW2 has clearly deposed in his statement about the said fact and exhibit the said document as ( PW1/C). Accused Shamsher Singh Ahlawat also sold 4 bigha 16 biswa land to Sh, Sandeep Malik and Sh. Mandeep Malik vide sale deed dated 02.08.96 ( D3) and ( D7). The said facts clearly deposed by PW1 Sh. Gopi Chand and exhibit the sale deed as PW1/D.Accused Shamsher Singh Ahlawat dishonestly and fraudulently handed over the original sale deed dated 19.03.96( D25) executed by Sh. Nathi in his favour to bank for Equitable mortgage, whereas he fully knows that he had already sold 8 bigha and 16 biswa C C No.18/03 105/133 land to other persons and thereby helped Sh. Jeevan Khanna and Hardeep Singh to cheat the bank and caused pecuniary benefit to themselves. Km. Rajni ( PW4) clearly stated in her deposition that she purchased the land from Shamsher Singh Ahalwat through Ex. PW4/E. This also shows dishonest and fraudulent act of Shamsher Singh Ahlawat.

167 It is argued by Ld. Defence Counsel that no deed of mortgage has been produced in the court at any stage executed by accused Shamsher Singh Ahlawat mortgaging his land.

168 Equitable mortgage is created in the bank by depositing the original papers of property. The entry regarding deposit of original papers is made in the Equitable Mortgage Register. Accused Shamsher Singh Ahlawat had deposited the property documents situated at Rojka Gujjar, Tehsil Sohna,Gurgaon through Form 84AA dated 03.03.98( D13) and entry of receipt of the same was mentioned in the Equitable Mortgage Register ( D75) by Sh.R.K. Nagra ( PW8) and signed by Sh. Hardeep Singh, Branch Manager. 169 It is argued by Ld. Defence Counsel that in the plaint Ex. DW5/A at page 8 in para 3, the Punjab and Sind Bank has claimed that respondent no. 2 to 7 had signed the letter of Guarantee in C C No.18/03 106/133 favour of the Bank and accused Shamsher Singh has been named as respondent no. 5 and therefore, as per claim of the bank there must be letter of Guarantee duly executed by Shamsher Singh, but then where is the letter of Guarantee which has not been produced in court during trial.

170 Accused Shamsher Singh Ahlawat had executed form no. 255 ( Revised) (D31) against the credit facilities of CC Rs. 25 lacs and Letter fo credit Rs. 70 lacs sanctioned to M/s Genex Chemicals Pvt. Ltd on 25.01.99 in the presence of PW9 and exhibit as PW9/28. Furthermore as per document D40 ( Ex. As PW7/A), accused Shamsher Singh Ahlawat is one of the guarantors of loan sanctioned to M/s Genex Chemicals Pvt. Ltd.

171 It is further argued by Ld. Defence Counsel that the accused Shamsher Singh Ahlawat is in no way related with Coaccused Jeevan Khanna in any way as person of same caste, covillager, or having any connection in their profession/business and the prosecution also could not lead any evidence of any nexus of meeting of mind of Shamsher Singh Ahlawat with coaccused person and therefore charges under section 120 B and 420 IPC against the accused must fail. In this connection their are repeated decisions of C C No.18/03 107/133 Supreme Court that there should be some evidence of agreement before accepting the involvement of any person in criminal conspiracy.

172 For the reasons discussed in this judgment role played by accused Shamsher Singh Ahlawat in conspiracy with Jeevan Khanna and Hardeep Singh to cheat Punjab & Sind Bank and to obtained pecuniary gain to Jeevan Khanna is clearly established. ROLE OF ACCUSED JEEVAN KHANNA.

173 According to prosecution, accused Jeevan Khanna as MD, M/s Genex Chemicals Pvt. Ltd. Initially made a request for sanction of working capital limit of Rs.10 lacs and import LC of Rs.100 lacs, which was sanctioned by accused Hardeep Singh on 28.02.98. A2 offered the landed property in the name of Shamsher Singh Ahalawat, r/o Sector 17/75, Gurgaon as collateral security. A4 V P Aneja, Bank's Panel Valuer submitted a false/inflated valuation report of agricultural land situated at Khewat No.1, Khata No.1, Kita 244, Rojka Gujar, Tehsil Sohna, Gurgaon 10 Bighas, 13 Biswas belonging to Shamsher Singh Ahalawat and valued the property as Rs.65.61 lacs whereas the real value of the entire property was not more than C C No.18/03 108/133 Rs.5 lacs. Consequent to sanction order, various loan documents were executed on 2.3.98 by Jeevan and Prateek Patra on behalf of the company. Accused Jeevan Khanna vide his letter dated 28.02.98 requested to Hardeep Singh for conversion of CA A/c No. 3216 which was allowed by him and that account was converted into CC A/c No. 87 on 12.07.98.

174 Jeevan Khanna vide his letter dt. 25.1.99 requested the Branch Manager to release fresh LC Limit for Rs.70 lacs and (CC) limit of Rs.25 lacs. Before release of loan facility sanctioned on 24.8.98 Jeevan Khanna and Pratik Ratra executed the various loan documents on 25.1.99. Jeevan Khanna fraudulently signed Form No. 84AA in respect of plot no. 683, Sector3132A, Urban Estate, Gurgaon on 25.1.99 knowingly that he had already sold the said plot to Sunil Kumar Gupta on 1.12.98.

175 Jeevan Khanna purchased plot no. 683, Sector3132A, Urban Estate, Gurgaon from Smt. Suneet Prabha Arora on 10.4.98 and applied in Estate Office HUDA to grant necessary permission to him to sell the said plot. The said permission was granted to him vide letter no. 4094 dt. 3.11.98. Jeevan Khanna sold the said plot to Sunil Kumar Gupta r/o C109 Raj Nagar, Pitampura, NewDelhi on 1.12.98 C C No.18/03 109/133 and said plot was transferred in the name of Sunil Kumar Gupta on 31.12.98. Jeevan Khanna had fraudulently sold the mortgaged plot after sanction of the credit facilities and prior to release of the facilities on 25.1.99 and dishonestly signed Form No. 84AA in respect of mortgaging plot to bank for credit facilities availed by A5 company on 25.1.99 knowingly that the said property had already been sold by him on 1.12.98. Hardeep Singh in connivance of Jeevan Khanna fraudulently made entry in the title deed register regarding receiving of original title deed of plot no. 683, Sector3132A, Urban Estate, Gurgaon. The title deed of the said plot was never available in the bank's record.

176 Jeevan Khanna on 8.6.99 submitted another request for opening another LC for US$ 147.688 (Rs.63.95 lacs approx.) 120 days on AWB basis without any margin. Accused Jeevan Khanna got sanctioned enhance credit facility against the equitable mortgage of property bearing no. 683, Sector 3132A, Urban Estate, New Delhi on 24081998. The said facility was released on 25011999, however, Sh. Jiwan Khanna sold the said property to Sunil Kumar Gupta on 01121998, which was recommended by accused Hardeep Singh.

C C No.18/03 110/133 EVIDENCE PRODUCED BY THE PROSECUTION AGAINST THE ACCUSED JEEVAN KHANNA 177 Accused Jeevan Khanna along with his coaccused Prateek Ratra had opened CC A/c bearing No. 3216 on 05.09.97 of M/s Genexx Chemicals Pvt. Ltd. (N26, Malviya Nagar, New Delhi) for running the business of pharmaceutical as its Managing Director under his signature at point Q203 & Q209 along with the signature of Prateek Ratra, Director at point Q201 & 202 vide A/c Opening Form Ex. PW16/10(D21) in Punjab & Sind Bank, Fatehpuri Branch. Accused JeevanKhanna vide letter dated 28.02.98, Ex. PW26/D (D70) under his signature at point Q215 as MD M/s Genexx Chemcials Pvt. Ltd. Requested the Manager, P & S Bank, Fatehpuri Branch to convert the above referred current account into cash credit(CC) Account. Along with copy of the extract of meetings of board dated 03.02.98, Ex. PW16/11(D71) for sanctioning of import LC limit of 100 lacs and CC limit of 10 lacs to meet the working capital requirement.

178 Accused Jeevan Khanna had written a letter dated 10.02.98 to branch Manager, Punjab and Sind Bank, Fatehpuri Branch Ex. PW12/A (D37) on behalf of M/s Genexx Chemicals Pvt. Ltd. as its C C No.18/03 111/133 MD under his signatures at point Q214 requesting for sanction the working capital limit of Rs. 10 lacs and import LC of Rs. 100 lacs, which was sanctioned vide appraisal note Ex. PW8/B, D38 dated 28.02.98. Property of Shamsher Singh Ahlawat S/o Nawal Singh has been furnished as collateral security as mentioned in Ex. PW8/B (D38) for equitable mortgage in favour of bank. 179 Accused Jeevan Khanna had written a letter dated 02.08.98 to branch Manager, Punjab and Sind Bank, Fatehpuri Branch Ex. PW26/C (D39) on behalf of M/s Genexx Chemicals Pvt. Ltd. as its MD under his signatures at point Q213 requesting for enhancement of cash credit limit from Rs. 10 lacs to Rs.30 lacs, which was sanctioned vide appraisal note Ex. PW7/A, D40 dated 24.08.98 vide which CC limit was enhanced to Rs. 25 lacs from 10 lacs but LC limit was reduced to 70 lacs from 100 lacs. Property measuring 10 bighas, 13 biswa( 3215 sq. yards) valuing Rs.65,61,000/ situated at Rojka Gujjar, Tehsil Sohna, Distt, Gurgaon, Haryana of Shamsher Singh Ahlawat S/o Nawal Singh has been furnished as collateral security as mentioned in Ex. PW7/A(D40) for equitable mortgage in favour of bank.

180 Property measuring 177.6 Sq. yards, plot no. 683, Sec31,32 C C No.18/03 112/133 A, Urban Estate, Gurgaon valuing Rs. 14.21 lacs has also been furnished as additional security for equitable mortgage in favour of bank as mentioned in Ex. PW7/A (D40).

181 PW5 Sh. Sunil Kumar Gupta had proved that Sh. Jeevan Khanna sold the said property, i.e. property bearing no. 683, Sector 3132A, Urban Estate, New Delhi to Sunil Kumar Gupta on 01.12.1998( Ex. PW5/A). Sh. Sunil Kumar Gupta had proved that HUDA issued the reallotment letter of property bearing no. 683, Sector 3132A, Urban Estate, New Delhi in his favour (Ex. PW5/B). 182 PW14 Sh. Subey Singh had proved that Sh. Jeevan Khanna sold the said property, i.e. property bearing no. 683, Sector3132A, urban Estate, New Delhi to Sunil Kumar Gupta on 01.12.1998 (Ex. PW14/A). Sh. Subey Singh had proved that HUDA issued the re allotment letter of property bearing no. 683, Sector3132A, urban Estate, New Delhi in favour of Sh. Sunil Kumar Gupta ( Ex. PW5/B).

183 Accused Jeevan Khanna has given his affidavit Ex PW9/DC mentioning that he owned property No.683 in Sector 31 32A U E Gurgaon and there is no bar or impediment in his mortgaging this C C No.18/03 113/133 property in favour of Punjab & Sind Bank . He has also filed his affidavit Ex PW9/DD stating that he had applied for loan facility from Punjab & Sind Bank, Fatehpuri Branch and handing over document of the title of this property to the bank as security . The affidavit is as under:

" 1. That I have applied for a loan facility from Punjab & Sind Bank Branch Fatehpuri, Delhi and have handed over documents of title in respect of my property No. 683, in Sector 3132A, Urban Estate, Gurgaon Haryana area measuring 148.5 sq yds to Punjab & Sind Bank Branch Fatehpuri, Delhi for securing the loan facility applied for from the said bank to the tune of Rs.95,00000/ Rupees Ninty Five Lacs

2. That the above property offered by me as security for the above loan facility is myself acquired/inherited property and I am its sole and exclusive owner in possession and no other person whosoever has any right, title or interest therein. That there is no charge or encumbrance of any kind whatsoever on the said property nor has the same been attached by any court or authority."

184 From the above quoted portion of affidavit it is clear that accused Jeevan Khanna had offered his above referred property as security and handed over the title document of the same to the bank . He has also handed over the documents / titled deed of Shamsher Singh pertaining to land measuring 10 bigha 12 biswa situated at C C No.18/03 114/133 village Sivan Rozkagujjar Tehsil Shona for security on account of loan facilities . In his affidavit Ex PW26/B he has mentioned that this property was offered as collateral security by Shamsher Singh who is the exclusive owner in possession of the property and the same is having no legal impediment for creating equitable mortgage in favour of bank and is free from all encumbrances . However from the discussion in this judgment it is proved that Shamsher Singh had already sold land about 8 bigha. 185 Resolution dated 6.1.99 passed by the Board of Director of M/S Genexs Chemicals Pvt Ltd with regard to opening of LC for US $27,084 with Punjab & Sind Bank, Overseas Branch Fatehpuri N Delhi in favour of Bio Products Laboratory, Dagger Lane, Elstree, Hertsfordshri, WD6 3DX U.K Ex PW16/1 ( D49) was filed under the signatures of Jeevan Khanna at point Q23 as MD of M/S Genexx Chemicals Pvt Ltd . Vide this resolution accused Jeevan Khanna was also authorized to sign all the necessary documents for opening the L C .

186 Resolution dated 15.12.98 passed by the Board of Director of M/S Genexx Chemicals Pvt Ltd with regard to opening of LC for US $104,000.00 with Punjab & Sind Bank, Overseas Branch Fatehpuri C C No.18/03 115/133 N Delhi favour of Bio Products Laboratory, Dagger Lane, Elstree, Hertsfordshri, WD6 3DX U.K Ex PW16/3 ( D50) was filed under the signatures of Jeevan Khanna at point Q18 as MD of M/S Genexx Chemicals Pvt Ltd . Vide this resolution accused Jeevan Khanna was also authorized to sign all the necessary documents for opening the L C .

187 Resolution dated 3.6.99 passed by the Board of Director of M/S Genexx Chemicals Pvt Ltd with regard to opening of LC for US $ 1,47,668.00 with Punjab & Sind Bank, Overseas Branch Fatehpuri N Delhi in favour of Kamada Ltd Kiryat Weizmann, Rehovot 76327 Isreal Ex PW16/5 ( D51) was filed under the signatures of Jeevan Khanna authorizing Mr Virender Girota to open the LC at point Q14 as MD of M/S Genexx Chemicals Pvt Ltd . Vide this resolution accused Jeevan Khanna was also authorized to sign attested true copy.

188 Accused Hardeep Singh had written letter Ex PW13/D1 dated 9.6.99 to the Zonal Manager, Punjab & Sind Bank, Siddharth Enclave, recommending the opening of LC amounting US$ 1,47,668.00 in favour of Kamada Ltd Kiryat Weizmann, Rehovot 76327 Isreal without paying any margin money at the time of C C No.18/03 116/133 opening of LC, with the offer of the party of another collateral security in the form of their office premises No.N26,Malviya Nagar, N Delhi value at Rs.3035 lacs in addition to existing two properties held with the bank valued at Rs.79.82 lacs. He has also mentioned in the letter that party has good past track .The relevant portion of this letter is as follows:

" With a sole view to revive, the party has come up with the proposal to open another front i e by importing U S Plasma from Kamada Ltd of Israel. The copy of the contract/ proforma invoice of the said party is enclosed herewith for your ready reference. The party has requested us to established import LC amounting to US $ 147668 ( Rs 63.94 lacs approximately ) on 120 days from date of AWB basis without paying any magin at the time of opening of LC . They have instead offered the same at the time opening release order from us on arrival of consignment. They have also offered another collateral security in the form of their office premises N26 Malviya Nagar N Delhi value at Rs. 30 to 35 lacs in addition to the existing two properties held with us valued at Rs.79.82 lacs .

As far s their past track record of dealing with us , we very proudly submit that they have never defaulted and honoured their obligation on respective due dates. The party has so far availed Import LC's worth Rs.275.02 lacs from Sept 97 to till date . Out of the above figures the party just could not make full payment of Lcs amounting to Rs.56.37 lacs due to reasons cited above. So, in view of the genuine difficulties being faced by the party and in the light of their fresh proposal and their firm assurance for adjusting the overdrawing from C C No.18/03 117/133 the sizable profits generated out of the said proposal and by realizing pending payments, we hereby recommend that their request for availment of fresh LC amounting to USD 147668 be considered favorably. The present position of the account is as follows :

Import LC : Nil CC : Rs.57.01 lacs."

189 Accused Hardeep Singh in his above referred letter has dishonestly and malafidely concealed the material fact that already Two LC,s dated 22.12.98 and 14.1.99 for Rs. 44.72 lacs and Rs.11.65 lacs respectively were opened which were developed on 12.4.99 and 24.5.99 due to non payment and an amount of Rs. 4475339/ on 12.4.99 and amount of Rs.1165309/ on 24.5.99 was debited due to devolvement of above said two LC. The net debit balance in the CC account was Rs.57,01,209/ on 24.5.99, Inspite of it accused Hardeep Singh in above quoted letter has referred that party has never defaulted and honoured their obligations on respective due dates. In these circumstances his recommending of opening of LC without any margin money also proves his dishonest intention. Hardeep Singh has also informed Zonal Manager that the party has also offered another collateral security in the form of their office premises i e N26, Malviya Nagar, New Delhi valued at Rs.30 C C No.18/03 118/133 lacs in addition to the existing two properties held with the bank. Hardeep Singh dishonestly and fraudulently concealed the fact that Jeevan Khanna has already sold the property, which was conveyed to the bank by Estate Officer HUDA vide his letter dated 28.4.99 (D61)while recommending the opening of fresh LC on behalf of M/S Genex Pvt Ltd. Thus accused Hardeep Singh has concealed this fact malafidely that HUDA vide letter dt 28.4.99 had informed that Jeevan Khanna has sold the plot to Sunil Kumar therefore bank lien cannot created on this property. Accused Jeevan Khanna has executed form No.84AA PW9/24 ( D80) on 25.1.99 wherein he has furnished plot No. 683 Sector 3132A as collateral security on behalf of M/s Genexx Chemicals Ltd under his signatures at point Q175 It also reflects his involvement in the criminal conspiracy with his coaccused to cheat the bank. 190 On the recommendations of accused Hardeep Singh vide his above reffed letter dt 9.6.99 Zonal Office vide letter dated 23.7.99 Ex PW13/A ( D63) permitted him to allow to open import L C of USD 1.48 lacs which should be released only after created effective mortgage of property bearing No. N26 , Malviya Nagar with the directions to Hardeep Singh that no LC is devolved and C C No.18/03 119/133 existing overdue outstanding on the account of devolve Lcs is to be adjusted at the earliest and to closely monitor the account. The relevant letter is as under:

" This has reference to your letter dated 7.7.99 on the captioned subject.

Keeping in view your's as well as Branch Manager's recommendation you have our permission to allow B/O Fatehpuri ,Delhi to open Import LC ( one time ) of USD 1.48 lacs ( equivalent to Rs.65.00 lacs) under your powers ( GM powers ) on DA 120 days from the date of Airway Bill on margin of 10% for import of US Plasma from M/s Kamada Ltd, Israel ensuring the safeguard of bank's interest. The additional facilities should be released only after effective mortgage is created on property situated at N26 Malviya Nagar, N Delhi, valued Rs.30.00 lacs in the name of Mrs Neeta Khanna and after fulfilling necessary formalities in consultation with bank's legal counsel. It be also ensure that amount of devolved and the existing over dues outstanding on account of devolved Lcs is adjusted at the earliest. Account to be closely monitored at your end."

191 Accused Hardeep Singh was specifically directed by the Zonal Manager to release the additional facility only after creating effective mortgage of property N26 Malviya Nagar but accused released the additional facilities creating the negative lien.

C C No.18/03 120/133 192 Accused Hardeep Singh has also accepted property of accused Shamsher Singh as collateral security which was purchased by him on 19.3.96 vide Sale deed Ex PW1/B in consideration of Rs. 2,03500/ in Roznamcha entry No.634 PW10/A dated 20.12.97 its value shown as 80 lacs . This property was purchased on 19.3.96 in a sum of Rs. 2,03,500/ its value cannot be increased by 39 folds within a period of about one and half year by any stretch of imagination. It also shows that accused Hardeep Singh had blindly accepted the valuation report of this property and Roznamcha Entry 634 Ex PW10/A, moreover bank had sanctioned credit limit of Rs.110 lacs but in the above referred Roznamcha lien mark for Rs.80 lacs only. Accused Hardeep Singh should have confirmed from the concerned authority in this regard before disbursement of the loan. which again proves his involvement in criminal conspiracy with his coaccused to cheat the bank.

FACTUAL AND LEGAL ANALYSIS OF DEFENCE ARGUMENTS ON BEHALF OF ACCUSED JEEVAN KHANNA.

C C No.18/03 121/133 193 Ld Defence counsel for accused Jeevan Khanna argued that he had never mortgage property bearing no. 683, Sector3132A, urban Estate, New Delhi nor filed title deed / documents of this property in the bank. Ld Defence counsel further argued that accused has not furnished the title documents in the bank that is why the same are not available in the bank . As discussed above accused Jeevan Khanna himself filed his affidavit Ex PW9/DD wherein he has deposed that he had furnished the title deed/ document of this property as collateral security and handed over the same to the bank. Accused Jeevan Khanna has also mentioned in form 84AA executed by him under his signatures with regard to furnishing of this property as collateral security . In these circumstances, there is no merit in this argument.

194 Ld Defence counsel has argued that initially loan facilities were granted to accused Jeevan Khanna on 2.3.98 thereafter the limit was enhanced on 24.8.98. There was no complaint wef 2.3.98 to 24.8.98 . Ld Defence counsel further argued that in a case of cheating dishonest intention to cheat should exist from the very beginning but in this case there was no such dishonest intention from the very beginning hence no offence of cheating punishable U/S 420 IPC is made out. Bank has already filed a suit for recovery against C C No.18/03 122/133 accused Jeevan Khanna which is pending before the DRT. It is argued that at the most it was a civil dispute but the CBI has malafidely converted it in a criminal case. In support of his argument Ld Defence counsel placed reliance on the following authorities:

Gopalakrishnan Vs State by Sub Inspector of Police , Tiruthani (1994) 3 Crimes 274 Hatiram Naik Vs Surendra Kumar Malik ( 1986) Cr L J 1271.

Hari Prasad Chamaria Vs Bishun Kumar Surekha AIR 1974 SC 301.

A K Khosla Vs T S Venkatesan 1992 Cr L J 1448 Hari Sao Vs The State of Bihar AIR 1970 SC 843 State of Maharashtra Vs Syndicate Transport Co (P) Ltd AIR 1964 Bombay 195.

Jageshwar Singh Rastogi Vs State of M P AIR 1980 SC 366. Vinar Ltd & Ors Vs Chenab Textiles Mills 1989 Cr L J 1858.

George Zacharia @ Raju Kanuvamplakka Vs T K Varghese & Ars 1994 AIR SCW 4884.

C C No.18/03 123/133 195 I have carefully gone through all the authorities. There is no dispute with the ratio of law laid down in these authorities, however, ratio of law laid down in a particular authority according to its own peculiar facts and circumstances. Ratio of law laid down in a particular authority may not be applicable in the facts and circumstances of other case.

The ingredients of offence of cheating are 1 Deception of any person 2 (a) Fraudulently or dishonest inducing that person:

                    (i)       to deliver any property to any person or

                    (i)       to consent that any person shall retain any 

                              property or 

                    (b)        intentionally inducing that person to do or omit to 

                    do anything which he would not do or omit if he were

not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property.

196 Intention is the gist of offence, the person cheated must have been intentionally intended to do an act which he would not have done or to omit to do an act which he would have done, owing to C C No.18/03 124/133 deception practiced on him. The intention at the time of the offence and the consequences of the act or omission itself have to be considered. To hold a person guilty of cheating it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise.

197 The distinction between mere breach of contract and the offence of cheating is a fine one. It depends upon the intention of the accused at the time of inducement which may be judged by his subsequent conduct. Mere breach of contract cannot give rise to criminal prosecution U/s 420 IPC, unless fraudulent or dishonest intention is shown right at the beginning of the transaction i.e. the time when the offence is said to have been committed. 198 Intention is defined as the purpose or design with which an act is done. Intention is an internal state of mind. Sometime it may be expressed sometime it may be implied. Implied intention is to be inferred from the acts and conducts of the parties . It is on the principle that every man knows the consequences of his act or conduct. If the consequences are foreseen as the certain results of the doer acts, it shall be taken as intended. Sometimes the intention is imputed from the act or the consequences. If a particular act has been C C No.18/03 125/133 done, the law will presume that the person doing it has the intention to do it without the enquiry as to whether actually he had the intention or not.

199 In the case in hand accused Jeevan Khanna had initially filed forged/fabricated Roznamcha entry No. 634 PW10/1 dated 20.12.97 , which was accepted by accused Hardeep Singh. He had also accepted property of accused Shamsher Singh as collateral security which was purchased by him on 19.3.96 vide Sale deed Ex PW1/B in consideration of Rs.2,03500/ in Roznamcha entry No.634 PW10/A dated 20.12.97 its value has been shown as 80 lacs . This property was purchased on 19.3.96 in a sum of Rs. 2,03,500/, its value cannot be increased by 39 folds within a period of about one and half year by any stretch of imagination. It proves that accused Jeevan Khanna was acting from the very beginning in connivance and conspiracy with his co accused Hardeep Singh, who had blindly accepted the valuation report of this property and Roznamcha Entry 634 Ex PW10/A, moreover bank had sanctioned credit limit of Rs. 110 lacs but in the above referred Roznamcha lien mark for Rs.80 lacs only. Accused Hardeep Singh should have confirmed from the concerned authority in this regard before disbursement of the loan. which again proves his involvement in criminal conspiracy with his C C No.18/03 126/133 coaccused to cheat the bank.

200 It is also proved on the record that accused Shamsher Singh Ahlawat executed Form 84 AA ( D16) and Equitable Mortgage was created on 02.03.1998( D75) by bank by receiving sale deed of said property. Sh. Shamsher Singh Ahlawat had already sold 4 bigha land to Sh. D N Verma and Madhvi Verma on 20.03.1996 vide sale deed dated 20.03.1996(D2) and (D6). Accused Shamsher Singh Ahlawat dishonestly and fraudulently handed over/deposited the original sale deed dated 19.03.96(D25) executed by Sh. Nathi in his favour in bank, whereas he fully knows that he had already sold 8 bigha and 16 biswa land to other persons and thereby helped Jeevan Khanna in furtherance of the criminal conspiracy in connivance with Hardeep Singh to cheat the bank and caused wrongful pecuniary gain to accused Jeevan Khanna and wrongful loss to the bank. 201 At the time of enhancement of loan facilities, accused Jeevan Khanna had created equitable mortgage of his property bearing plot No. 683, Sector 3132A, Urban Estate, Gurgaon. The said property was purchased by Jeevan Khana from Smt. Suneet Prabha Arora W/o Satpal Arora on 10.04.98 and the said plot was transferred in the name of Jeevan Khanna on 13.05.98. Further Jeevan Khanna applied C C No.18/03 127/133 in Estate Office HUDA to grant necessary permission to sell the same plot on 02.11.98. Estate Office HUDA granted necessary permission to Jeevan Khanna vide their letter No. 4094 dated 03.11.98 and Jeevan Khanna sold the said plot to Sh. Sunil Kumar Gupta R/o C109, Raj Nagar, Pitampura, New Delhi on 01.12.98 and the said plot was transferred in the name of Shri Sunil Kumar Gupta on 31.12.98.

202 From the above discussion it is proved that accused Jeevan Khanna was having dishonest intention to cause wrongful loss to the bank and wrongful gain to himself from the very beginning when he had deposited the forged and fabricated Roznamcha entry no. 634 with the bank along with the title deed of the property of accused Shamsher Singh as collateral security, major part of which was already sold. Dishonest intention of accused Jeevan Khanna is also proved at the time of enhancement of the sanction limit when he had furnished the additional collateral security of property No. 683, Sector 3132A, Urban Estate, Gurgaon which was already sold by him to Sh. Sunil Kumar Gupta.

203 Hon'ble Supreme Court in State of AP Vs. IBS Prasada Rao & Ors AIR 1970 SC, 648: C C No.18/03 128/133 "(A) Evidence Act (1 of 1872), S.3 - Criminal P.C. (5 of 1898), S.367 - Penal Code (45 of 1860), S.120B, S.419 and S.420 - Appreciation of evidence - Circumstantial evidence, sufficiency of - If combined effect of all proved facts taken together is conclusive in establishing guilt of accused, conviction would be justified even though anyone or more of these facts by itself is not decisive - Held on facts and circumstances that charges under Sections 120B and 420, IPC have been established against all the four accused and under Section 419, IPC against accused No. 3".

204 Hon'ble Supreme Court in Tulsi Ram and others Vs. The State of Uttar Pradesh AIR 1963 Supreme Court 666 ( V 50 C 103) has held as follows:

"The accused consigned small quantities of goods but subsequently tampered with the railway receipts by showing that the consignments were were of large quantities. The accused then endorsed the railway receipts in favour of one of the firms belonging to them. Those firms drew large sums of money commensurate with the large quantities of goods specified in the forged receipts and on the security of those receipts drew demand drafts or hundis in favour of various banks.

Held on the facts and circumstances of the case that the accused by obtaining credits for large amounts on the strength of C C No.18/03 129/133 hundis supported by forged railway receipts had made a wrongful gain and therefore was guilty under S. 420 I P C."

205 Hon'ble Supreme Court in Tammineedi Bhaskara Rao & Ors. Vs. State of A P & Anr. 2007 CRL. L J 1204 has held as follows:

"The definition of cheating contains two classes of acts which the person deceived may be induced to do. Firstly, he may be induced fraudulently or dishonestly to deliver any property to any person or to consent that any person shall retain any property. The second class of acts is the doing or omitting to do anything which the person deceived would not do or omit to do if he/she were not so deceived. In the first class of acts, the inducement must be fraudulent or dishonest and in the second class of acts, it must be intentional but not fraudulent or dishonest. "Deceiving" means causing to believe what is false or misleading as to a matter of facts or leading into error. Whenever a person fraudulently represents as an existing fact, that which is not an existing fact, he commits deception. The person cheated must have been intentionally induced to do an act which he would not have done, but for the deception practiced on him. The intention at the time of the offence and the consequence of the act for omission has to be considered. The damage which is caused by the act or omission must be direct, natural or a probable consequence of C C No.18/03 130/133 the induced act. The person deceived must have acted under the influence of the deceit. It is necessary that harm should be caused to the person deceived. In the present case, the allegations in the complaint, in relation to "cheating" under sections 417, 418 and 420, IPC are that the accused had cheated complainant with knowledge that they were using her money, influence and position in the USA for their gain, causing wrongful loss to the complainant in every aspect of her life. Accepting as true the allegations that the intention of the accused was that the main accused should use his marriage, with the complainant to go to the USA and to make them part with their money to ask his studies, stay in the USA and as dowry, in effect, the complainant and her parents were induced to do something which they would not have done had they not been so deceived. It cannot, therefore, be said that the ingredient of "cheating" are not attracted, even prima facie ".

206 In view of the above discussion, it is proved beyond reasonable doubt that accused Jeevan Khanna was having dishonest intention to cheat the bank from the very beginning. There is no merit in the argument that it was only a civil dispute and no criminal case is made out.

C C No.18/03 131/133 207 Now it is well settled legal prepositions that companies and corporate houses can be convicted for the commission of offence of cheating as defined under section 415 IPC punishable under section 420 IPC. Hon'ble Supreme Court in this regard in Iridium India Telecom Ltd vs. Motorola Incorporated & Ors., AIR 2011 SUPREME COURT 20 has held as follows:

"Offence of cheatingCompanies and corporate houses can no longer claim immunity from criminal prosecution on ground that they are incapable of possessing necessary mens reaMens rea is attributed to Corporations on principle of 'alter ego' of company".

208 From the above discussions in this judgment, prosecution has proved beyond reasonable doubt that accused Hardeep Singh. Jeevan Khanna and Shamsher Singh were involved in the criminal conspiracy and they have cheated the bank in furtherance of criminal conspiracy in connivance and collusion with each other, therefore I hold guilty all the accused for committing the offence U/s 120B, r/w 420 IPC and 13 (2) r/w Section 13 (1) (d) of P C Act 1988. 209 Prosecution has also proved its case beyond reasonable doubts against accused Hardeep Singh for committing the substantive offence punishable U/s 13 (2) r/w Section 13 (1) (d) of P C C No.18/03 132/133 C Act 1988.

210 Prosecution has also proved its case beyond reasonable doubts against accused Shamsher Singh and Jeevan Khanna alongwith M/S Genexx Chemicals Pvt Ltd for committing the substantive offence punishable U/s 420 IPC 211 Accordingly accused Hardeep Singh. Jeevan Khanna and Shamsher Singh are held guilty for the aforesaid offences.

Announced in open court                       ( V. K. Maheshwari) 
On 11.12.2012                               SPECIAL JUDGE: (P C Act)03 
                                                    CBI: DELHI




C C  No.18/03                                                          133/133

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Delhi District Court

Cbi vs 1 Hardeep Singh on 11 December, 2012