Gujarat High Court
Ahmedabad Peoples Co Op Bank Ltd (In ... vs State Of Gujarat & on 28 July, 2017
Author: A.Y. Kogje
Bench: A.Y. Kogje
R/CR.MA/18544/2013 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
CRIMINAL MISC.APPLICATION (FOR CANCELLATION OF BAIL) NO.
18544 of 2013
With
CRIMINAL MISC.APPLICATION NO. 8574 of 2017
In
CRIMINAL MISC.APPLICATION NO. 18544 of 2013
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AHMEDABAD PEOPLES CO OP BANK LTD (IN LIQUIDATION)....Applicant(s)
Versus
STATE OF GUJARAT & 1....Respondent(s)
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Appearance:
MR DHARMESH V SHAH, ADVOCATE for the Applicant(s) No. 1
MS. STUTI Y JANI, ADVOCATE for the Applicant(s) No. 1
MR.D K.PUJ, ADVOCATE for the Respondent(s) No. 1
MR HK PATEL, APP for the Respondent(s) No. 1
MR BB NAIK, SENIOR ADVOCATE assisted by MR PARTHIV A BHATT,
ADVOCATE for the Respondent(s) No. 2
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CORAM: HONOURABLE MR.JUSTICE A.Y. KOGJE
Date : 28/07/2017
ORAL ORDER
1. This application is filed under Section 439(2) of the Criminal Procedure Code by the General Manager, the Ahmedabad People's Cooperative Bank Ltd. (hereinafter referred to as "the complainant Bank") for cancellation of bail granted in favour of respondent No.2 in connection with I-CR No.4 of 2009 registered with CID Crime, Gandhinagar Zone Police Station. The Page 1 of 18 HC-NIC Page 1 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER aforementioned FIR is filed for offences under Sections 406, 409, 47, 468, 471, 120-B and 114 of the Indian Penal Code.
2. In connection with this offence, respondent No.2 came to be arrested, remanded and thereafter, till filing of the bail application being Criminal Misc.Application No.171 of 2010, continued to be in judicial custody. By order dated 23.02.2010, the application of respondent No.2 came to be allowed, the respondent No.2 came to be enlarged on bail and 9 conditions were imposed.
2.1 Being aggrieved by some of the conditions imposed under order dated 23.02.2010, respondent No.2 filed Criminal Misc.Application No.6953 of 2010 before this Court for modifying condition No.2 of order dated 23.02.2010. This application came to be disposed of by order dated 17.08.2010 relegating the respondent No.2 to the concerned Sessions Court. The respondent No.2 thereafter filed Criminal Misc.Application No.3257 of 2010 for modification of condition No.2 before the Sessions Court. The Sessions Court passed an order dated 07.10.2010 partially allowing the application and modifying condition No.2.
2.2 The complainant Bank filed Criminal
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Misc.Application No.15313 of 2010 challenging the order passed in Criminal Misc.Application No.171 of 2010 as well as in Criminal Misc.Application No.3267 of 2010. This application came to be disposed of by order dated 22.06.2011 rejecting the application of the complainant Bank.
2.3 On 20.11.2011, the complainant Bank filed Criminal Misc.Application No.4539 of 2011 under Section 439(2) of the Criminal Procedure Code for cancellation of the bail on the ground that the respondent No.2 has not deposited the amount with the Bank and therefore, failed to comply with the conditions of bail. This application came to be disposed of by order dated 18.06.2013 with the direction that the respondent No.2-accused should comply with the affidavit Exh.2 filed in the proceedings of Criminal Misc.Application No.4539 of 2011 (page No.51). 2.4 The complainant Bank therefore has moved this application for cancellation of the bail order on the ground that the respondent No.2 has not complied with the conditions of bail order. Though respondent No.2 was given chances to honour his assurances given to the Court every now and then, he has failed in all the counts and therefore, as the respondent No.2 has failed to deposit the amount with the complainant Bank, he has misused the liberty given to him.
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3. Heard learned Advocate for the applicant-Bank, learned APP for respondent No.1-State and learned Senior Advocate for respondent No.2-accused.
4. Learned Advocate for the complainant Bank submitted that the respondent No.2 has not honoured the undertaking given by him before the Sessions Court, on the basis of which the discretion was exercised in favour of the respondent No.2.
4.1 It is submitted that as per the order of bail dated 23.02.2010 and modified order dated 07.10.2010, the respondent No.2 was to make payment in installments to the Bank. The respondent No.2, having not honoured such direction and flouted conditions, the bail deserves to be cancelled.
4.2 Learned Advocate drew attention of this Court to order dated 22.06.2011 passed by this Court in Criminal Misc.Application No.15313 of 2010 to contend that the respondent No.2 was under obligation to make repayment to act in conformity with the order dated 22.06.2011 and by not doing so, the respondent No.2 has flouted the orders of this Court as well. He drew attention of this Court to the assurances given by the respondent No.2 every now and then which are placed on record along with this application and submitted that by Page 4 of 18 HC-NIC Page 4 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER giving such undertaking /affidavit, the respondent No.2 has time and again misled the Court to exercise discretion in his favour. Learned Advocate referred to the pleadings and submitted that after respondent No.2 was enlarged, he has deposited only Rs.2.20 crores till date and has failed to deposit Rs.21.38 crores which was to be paid in 10 installments.
4.3 It is submitted that as on date, the respondent No.2 is trying to befoul the complainant Bank to dispose of the immovable properties to recover the dues of the Bank. However, all such properties are not having any clear and marketable titles and therefore, attempts on the part of respondent No.2 is only to make a show of repaying Bank whereas he has no intention to repay. For this purpose, he drew attention of this Court to the affidavit filed on behalf of the complainant Bank. 4.4 Learned Advocate submitted that as and when respondent No.2 has come with proposal to the Bank for disposal of any of the immovable properties or when the Bank on its own made efforts to dispose of the immovable properties, the Bank incurred lot of expenditure in the process, but ultimately, on account of faulty titles of the respondent No.2, the Bank could not succeed in selling the immovable properties to recover the Bank's money.
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5. As against this, learned Senior Advocate for respondent No.2 submitted that the conditions imposed by the Court are themselves so onerous that imposition of such conditions itself would amount to non-granting of bail.
5.1 Learned Senior Advocate for respondent No.2 submitted that inability to make repayment to the Bank to a great extent is attributable to the Bank officers themselves. It is submitted that inaction on the part of the Bank officers at the relevant time has resulted into wasting of the immovable properties. It is submitted that honest attempts were made by respondent No.2 in repaying the Bank's money and it is not the case that the respondent No.2 from the very beginning wanted to cheat and defraud the Bank. It is submitted that after the loan facility was availed, account of the respondent No.2 was operated regularly for more than 2 years and it was on account of prevailing market situation, his reliance upon certain persons who are co-accused in this case, had led to a situation where business of respondent No.2 started downing. It is submitted that respondent No.2 was made a target though other persons were responsible for non-repayment of the loan, which included Directors of the Bank. However, no action has been taken against them. It is also submitted that the Bank officers have Page 6 of 18 HC-NIC Page 6 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER acted hand-in-glow with one Dharmendra Gandhi who is the real culprit in the entire episode.
5.2 It is pointed out that though the investigation revealed that the amount of loan facility which was availed from the Bank had travelled to the account of said Dharmendra Gandhi, nothing was done against him at the relevant time. He submitted that a huge piece of land worth crores of rupees which was mortgaged with the complainant Bank was more than sufficient to cover the loan facility, but the Bank officers, acting hand-in- glow, permitted said Dharmendra Gandhi to dispose of this land by executing release deed in favour of said Dharmendra Gandhi without knowledge and behind the back of the respondent No.2. It is submitted that respondent No.2 has, in that connection, filed an FIR against Dharmendra Gandhi, for which after due investigation, charge sheet is filed. It is submitted that the intention of the respondent No.2 is honest for repaying Bank's money for which he had made attempt by applying for One Time Settlement. It is submitted that such attempt was also frustrated by the Bank Officers. It is submitted that the applicant is still ready and willing to repay to fulfill his assurances that as and when respondent No.2 receives money, he would repay the same to the Bank.
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5.3 It is submitted that the respondent No.2 has,
on affidavit, stated the manner in which the officers of the complainant Bank have acted hand-in-glow with Dharmendra Gandhi to frustrate the attempt of repayment by disposing several immovable properties which were mortgaged or otherwise. None of these averments made on affidavit has been controverted by the complainant Bank. It is submitted that the order of bail was of the year 2010 and any adverse order after passing of 7 years would severely prejudice rights and liberty of respondent No.2. He, therefore, prays for dismissal of the application. 5.4 Learned Senior Advocate for respondent No.2 further submitted that though the account of respondent No.2 was declared NPA long time back and as per the prevailing Banking system, no interest, etc. can be charged, yet the Bank has continued to charge interest on such account to inflate outstanding and such inflated figures are produced on record to artificially increase magnanimity of the amount involved.
5.5 Learned Senior Advocate for respondent No.2 has referred to the following judgments in support of his contention that as a matter of fact, no offence of cheating has taken place in the instant case and it is only a matter of loan transaction where respondent No.2-
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accused was unable to repay the installments:-
I. In the matter of Anil Mahajan Vs. Bhor Industries Ltd. & Anr., reported in (2005) 10 SCC, 228.
II. In the matter of Alpic Finance Ltd. Vs. P.Sadasivan & Anr., reported in (2001) 3 SCC, 513.
5.6 Learned Senior Advocate for respondent No.2 also relied upon judgment of the Apex Court in the matter of Sandeep Jain Vs. National Capital Territory of Delhi, by Secretary, Home Department, reported in AIR 2000 SC 714, in support of his argument that onerous conditions of bail should not frustrate the very order of bail. Learned Senior Advocate also relied upon judgment of this Court in the matter of Mahersing or His Successor-in- Office Intelligence Officer Vs. Pradipkumar Bharatlal Poddar & Ors., reported in 2004 (4) GLR, 3332. He relied upon para-28 of this judgment.
6. Learned APP supports the case of the complainant Bank and submitted that the respondent No.2 has indeed misused the liberty. He relied upon report of the Police Inspector, CIR Crimes addressed to his office to contend that the respondent No.2 has not marked his presence on 1st and 15th of every month. He submitted that Page 9 of 18 HC-NIC Page 9 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER the respondent No.2 has changed his residential address and that the Chief Metropolitan Magistrate Court has issued an arrest warrant against respondent No.2 on 11.01.2016.
7. I have heard learned Advocates for the rival parties and perused the case papers.
8. It will be appropriate at this stage to refer to certain orders passed in this very matter, especially order dated 11.12.2015 and (18.12.2015), wherein the Court has recorded that Pay Order of Rs.2 crores is handed over by the intending purchaser of the property of the accused, which would be paid within four weeks. 8.1 Order dated 29.01.2016 records that the subject property was already disposed of by the Bank. This goes to indicate that pending the application, attempts were being made that the Bank receives its money out of the properties of respondent No.2 that can be disposed of. 8.2 A perusal of the orders passed from time to time and the last order dated 18.06.2013 passed by the learned Additional Sessions Judge, Court No.9, Ahmedabad City in Criminal Misc.Application No.4539 of 2011 directs respondent No.2 to act in conformity with Exh.42. Exh.42 is affidavit dated 11.06.2013 filed by respondent No.2. The affidavit is an assurance that the respondent No.2 Page 10 of 18 HC-NIC Page 10 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER will cooperate with the Bank for disposal of the properties mortgaged to enable the Bank to recover its money and the balance amount would be deposited by 31.12.2013. The properties which were to be disposed of were mentioned in the affidavit dated 06.06.2013 (Exb.40).
8.3 Further affidavit of respondent No.2 dated 12.08.2016 refers to the mortgaged properties situated at village Sachana, Tal. Viramgam, Dist. Ahmedbad., some shops in Suncity Mall at Bopal and flats situated at Jodhpur, Ahmedabad. In the affidavit, it is averred that the mortgaged deeds in connection with the lands of village Sachana which are valued at Rs.30 crores were executed with the office of the Sub-registrar, Paldi, Ahmedabad and the original title deeds were deposited with the complainant Bank. These mortgaged lands and title deeds were handed over to one Dharmendra Gandhi on 29.03.2007, whereby valuable land mortgaged was released for meager amount of Rs.6.16 crores. The Bank had, therefore, frustrated the recovery from secured immovable properties. The affidavit also mentions about 23 flats in Subhdarshan Apartments, which was also mortgaged and title deeds were deposited. These flats were also not used for recovering the dues of the Bank.
8.4 The charge sheet filed against Dharmendra
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Gandhi for offence under Section 419 is in connection with the land of village Sachana and that these valuable lands, by creating false and fabricated documents, have been disposed of o 31.08.2007 and whatever proceeds were realized were kept with said Dharmendra Gandhi. 8.5 Another affidavit dated 10.01.2014 is filed to bring on record the fact that the Bank is siding accused Dharmendra Gandhi and non-cooperative attitude adopted by the Bank to dispose of the mortgaged properties. The One Time Settlement Scheme, though perceived vigilantly by respondent No.2, the Bank has failed to respond to it till date.
8.6 Further affidavit of respondent No.2 dated 19.12.2014 refers to his attempts to dispose of 23 flats of Subhdarshan Apartments to a single buyer who had expressed willingness to pay the amount for purchase of 6 flats. The affidavit also states that 5 shops at Suncity Mall were sold for Rs.51 lakhs, which is received by the Bank. In connection with the mortgaged land of village Ranagadh, the Bank had initially agreed to sale for Rs.1 crore, of which Rs.11 lakhs was deposited by the proposed purchaser and the matter lies at that stage, as after executing the registered document, the Bank would be able to receive balance Rs.89 lakhs. In connection with the land of village Kankarawadi, respondent No.2 has issued Page 12 of 18 HC-NIC Page 12 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER advertisement at his own expense so that the same could be disposed of and the amount realized can be deposited.
9. The affidavit on behalf of the complainant Bank is to the effect that the land of village Ranagadh was already sold off by the Bank and amount has been recovered and appropriated. The Bank, though ready to cooperate for sale of flats in Subhdarshan Apartments, the Bank is unable to, as the Civil Suits pertaining to this property are pending before Civil Court at Ahmedabad (Rural). In connection with the NA land at village Kankarawadi, the Bank has expressed readiness to cooperate in sale of these lands to realize the amount. In connection with lands at Limdi and village Ranagadh, the Bank has made attempt to dispose of these properties by issuing advertisement. However, they have received objections against sale of such lands from one Suresh G.Singhaniya.
9.1 The rejoinder of the complainant Bank dated 17.02.2016 is filed in response to the directions of this Court vide order dated 29.01.2016 and it is stated that the ex-management of the complainant Bank and respondent No.2 had sold the properties and deposited the amount of Rs.2.50 crores realized with the Bank.
9.2 Yet another affidavit of respondent No.2 dated
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28.12.2016 refers to a civil litigation filed by
respondent No.2 against Dharmendra Gandhi in connection with the land of village Sachana by forging signatures of respondent No.2 /Directors of the company in whose name the land was running. In such case, Dharmendra Gandhi has entered into negotiations with respondent No.2, from whom he is likely to receive Rs.12 crores to Rs.15 crores. It is undertaken in this that the amount shall be deposited with the Bank as and when the same is received.
10. Considering the aforesaid facts and circumstances, this Court is of the view that from the record of the case it appears that attempts have been made by respondent No.2 to dispose of the immovable properties so that the Bank realizes its money. Where the attempt has succeeded, respondent No.2 has deposited the amount with the Bank.
11. From the pleadings it appears that to some extent, fault also lies at the doorstep of the complainant Bank on account of its inability to act in time to realize Bank's money from the properties mortgaged as security to the loan allegedly availed by respondent No.2. This Court finds that the respondent No.2 has filed affidavit (Exh.42) to deposit Bank's dues on or before particular date. The Court is also Page 14 of 18 HC-NIC Page 14 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER satisfied that reasonable attempts have been made by the respondent No.2 in the direction of recovery of Bank's money.
12. This Court finds strength in the arguments of learned Senior Advocate for respondent No.2 that onerous conditions of recovering the amount of the Bank cannot be permitted to frustrate the discretion exercised in favour of the respondent No.2 and thereby costing liberty of respondent No.2.
13. This Court in the case of Mahersing (supra), has held in para-28 as under:-
"28. Coming to the question whether the order requiring the accused-Revisioner to deposit Rs.23 lakh with the Department in the first instance as a condition precedent for release on bail and then to deposit the remaining amount of the 25% of the duty evasion can be said to be proper this Court is at a loss to understand as to under which provision of law or in exercise of which power this condition is imposed or direction is given. It has to be remembered that these are criminal proceedings, and while considering the question of bail, the Court may not exercise the power in a manner to recover the amount. For recovery of the duty allegedly evaded, there is a separate machinery established by law and thus direction of deposit of 25% out of which Rs. 23 lakhs to be Page 15 of 18 HC-NIC Page 15 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER deposited upfront as a condition precedent in addition to bond, surety and cash security is far from a condition to prevent such recurrence. Discretionary power of Court to impose conditions while releasing an accused on bail are to be exercised with judicial discretion. A criminal court cannot exercise such powers for recovery of amount."
13.1 The Apex Court in the case of Sandip Jain (supra) has held in paras-4 and 5 as under:-
"4. We are unable to appreciate even the first order passed by the Metropolitan Magistrate imposing the onerous condition that an accused at the FIR stage should pay a huge sum of Rs. 2 lacs to be set at liberty. If he had paid it is a different matter. But the fact that he was not able to pay that amount and in default thereof he is to languish in jail for more than 10 months now, is sufficient indication that he was unable to make up the amount. Can he be detained in custody endlessly for his inability to pay the amount in the range of Rs. 2 lacs. If the cheques issued by his surety were dishonoured, the court could perhaps have taken it as a ground to suggest to the payee of the cheques to resort to his legal remedies provided by law. Similarly if the court was dissatisfied with the conduct of the surety as for his failure to raise funds for honouring the cheques issued by him, the court could have directed the appellant to substitute him with another surety. But to keep him in prison for Page 16 of 18 HC-NIC Page 16 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER such a long period, that too in a case where bail would normally be granted for the offences alleged, is not only hard but improper. It must be remembered that the court has not even come to the conclusion that the allegations made in the FIR are true. That can be decided only when the trial concludes, if the case is charge- sheeted by the police.
5. It is contended by the learned Counsel for respondent that if the appellant was not in a position to abide by the conditions imposed for granting bail he should have raised his objection at that time or should have challenged the order soon after his release on bail. No doubt he should have done so at the earlier stage. But his failure to do so then cannot now be used as a bar for preventing him from approaching the court with a prayer to release him from jail. He cannot be detained in custody for long without conviction in a case of this nature."
13.2 This Court is conscious that present application is not in the nature of challenge to the onerous conditions imposed by the bail order, but when the cancellation is sought on the ground of non- fulfillment of the onerous conditions then certainly the precedents would be relevant.
14. This Court also takes into consideration the submission made on behalf of learned APP about non- marking of presence by respondent No.2 at the nearest Page 17 of 18 HC-NIC Page 17 of 18 Created On Wed Aug 16 01:52:47 IST 2017 R/CR.MA/18544/2013 ORDER Police Station and change of address of residence. In this connection, learned Senior Advocate for respondent No.2 submitted that change of address is already tendered to the concerned Court in writing.
15. Instead of cancelling the bail after period of 7 years, this Court deems it fit to afford one more opportunity to respondent No.2 to standby with the assurances to repay Bank's dues by filing an undertaking on affidavit in clear terms before this Court within one week from today ant any failure to do so would render bail granted to respondent No.2 liable to be cancelled as well as initiation of contempt proceedings.
16. The order passed in this application will not come in any way in the proceedings of arrest warrant issued against respondent No.2 by the Chief Metropolitan Magistrate Court.
17. The application is disposed of in the aforementioned terms. Rule is discharged.
18. In view of the order passed in the main Criminal Misc.Application No.18544 of 2013, no orders on Criminal Misc.Application No.8574 of 2017. Disposed of accordingly. Notice is discharged.
(A.Y. KOGJE, J.) SHITOLE Page 18 of 18 HC-NIC Page 18 of 18 Created On Wed Aug 16 01:52:47 IST 2017