G T Hegde Tattisar vs State Rep By Spp on 26 November, 2008

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Karnataka High Court

G T Hegde Tattisar vs State Rep By Spp on 26 November, 2008

Bench: N.Ananda

1?'? THE HIGH COURT OF KARNATAKA

CIRCUY1' BENCH AT IJHARWAD

DATED THIS THE 26TH DAY OF NovEMBER..2'éQs  3

BEFORE";

THE HON'BLE MR..,I1,_rS'I'ICE :i\I--..ANAN,'i}A'A.  "

CRIMINAL REVISION PE;T§f:"=10N NO..248f2(§G4}VV

BETWEEN:

1. G. T. Hegdcx  if V

Tattisaxf  about  «. V
63   
EX-C}C1a1'i'i;Ii%ijZ{l,"'.'   _ _'
K';.D,€3.C;  Sirsi, " _

U.K...'_Distric1;.'  '-

ii. . Shltenivas Padmanabh Shetty,
~ '5;,Agé{§ aboui"60_____Y(:ars,
A «  $51!}-'M{)§.& KDCC Bank,
" ~   'U_.I'<.,_I§)ist:rict. ...PCtiti0I}.€':I'S

'£334' Sr: A.;é%;%a¢ga¢, for Sn', 3.12. acgcie Hudiamaxm, Adv.)

--V ANI:$';" . 

 £1; : 4_ state,
 _ V. _Reprcsented by SPF',

 ﬁigh Court Building,

   Ba11ga1orc--56{) om.

 2. M] s Murdeshwar Foods 8:; Exports

Ltd.
Gokul Road,
Hubli, by Chaixman and



Authoriseé, Oﬁcer

Sri.Anancia Shetty,

Sjo iranna Shetty, major.   
Murudeshwar. I

3. Sri.V1_1ay Kamath,
S] 0 Vcnkat Rae,
R / o Mathadkzzrl,
Karki,
Honnavar Tc}.

4. Srimvasa Naik,  VA  '  
S/o Ramakanth   '

"Shrcc Nivgs".._ _  _  ' 
R/0      * _  
 "   "     ..,Respo11dent£;

{By  r~Icf§<§§> for R1,
Sri. S.G. = .Bha.ga1va1;, 'Adv,' Pb:  -~ Absent,
Sri. Deepaig, Adv. }?.'oz"~ " " _ " V'

fl'-]r.ziLs 1we';r§.si€)n petition is; ﬁied uader secﬁon
39'7{;§--). :2:/Aw Sec.4'€}1V___Qr.P.C3. garaying to set aside the order

~ V. "pasﬁé 'iy tile: learned JMFC Honnavar in C.C.No. 1370/98
 the'r¢by.,vozde,ring to frame charges so far against these
 .§L)€T.V1'Ii(.V1;if.",¢_fi'--"r'~._ 'a3y'=._ Qtitier dated 5. 1.200}, and to eiischarge

petitioners  2, and etc.

Thiﬁ. rrﬁision petition coming on for hearing this day,

  ' ntﬁc:  made £316: following:

ORDER

iPc:ti¥§oners 1 and 2 am arrayed as Accused. Nos.3 am! A' 4 in C.C.No.i3'70/ 98 pending trial for oﬂhnces punishable uzlder sections 465, 468, 471, 220-8 and 202 of {PC 1*/W §'\_?. :94-/V" r : 3 : section 34 cf II-'C on the ﬁle of JMFC, Honnavar, had an application for discharge. By the reasoning of the oréer ma} ceurt rejected ' the appiicationg: ' mtitioners are before this Court by ii i Cr.P.C. « ._ é _ _

2. As could be seenjfrom ze<So_rd$, charge. eheetjwass i submitted before tria} court on 1998: w'I'§e 'iéﬂdiiigeﬁﬁoner had ﬁled Cr.P.No.3(}92{Ai_to pending in eer' "M 1:£.'§%f3'_0/ii«:1:§§'98:i}'~.¢VV'.:}"]:1e Aihilu-jjieiitiozxer had alga ﬁled Crl. R3139 Q98 foi" ieﬁgfs.

_ On eitiove criminal petitions Wcm taken «...,u§-ifear :,.;'2ea;**i;3g. argmn' g the matter for some time for petitioners sought for pennissien to Wiizigiiirase Aiaetitiorzs. This court dismissed petitions as This court has held that petitioners am entitled A "i" the defence that is apex: ta them under the Cjriminal ' Cede at the trial. It is needless to state that the erders passed in Cr}.P.309}]98 and (3r1.P.3(}92]98 ttkfté L binding on the petitioners. This court while dismissing {U .

petitions as withdrawn has clearly held thai _ am at liberty to urge all the gxbundsgvailable ?t:ji'1eii1::atAVti:_:€§' " = trial.

3. As already sta?:ed.,__ petitj6?:3.ers £61' L. discharge before ma' 1 court. Thelitzae _ﬁ*l_eouft' eonﬁlderaijon of the documents ﬁled :.§ecfr.i§3i1--« CLP. has held that there are gzx3u11ds_V_tp;' jv ﬁetitioners have committed a}3e;:gc:d=i riismissed the ap§lic2}.'ti€;$ﬁ. " « ii?-3' 3 V '-I --~ Hegcie, l£33:€'.l1€d C{)'{.1I1S€l for petiﬁoners %§;ﬁ:2_Vlean;xe€1.Q{Sx}emmen£ Advocate for State. , =L3ea1':led""Ci3unsc§ for petitioners relying 011 the _ljt:.f;¥.xgia_e§1tel$perted in (1) AIR 2900 Ste. 3330, (ii) AIR 1972 S;<:_._'"S45,_'.(iii;V_ li.R 1935 KAR. 2670, and {iv} ILR 1993 KAR. 'x__1430, contended thai charges shall no': he ﬂamed on A "l11:§iii'ﬁcient material. When prima facie case is not made out ' is just and proper to discharge the accused to aveici abuse ll precess 0f ceurt. The learned Counsel Woulci submit that there shall be judicious application of mind to the material pzoduced and the documents ﬁled by the "

order to frame charge or to discharge' the 'A u learned Counsel woulé submit tﬁ-at ';o1'5c§~e1*' charges substantially aﬁ'ects'f)e11.'g.on's '3é}:V):er1;y Court = L' shouid not automatically frame The reepogeibiﬁty of framing the charge is it has to be judiciousiy consideied. 'afivertjng to the records must riot é§ﬁQptV€}ecision_of1:heupit$secution.

6; """ would submit that peﬁtionexs aixd as Chanm' an and Managing Qixector of Sirsi The decision to sanction 1oan_~-§.:ov_Laeoused"" no___s,.1 and 2 was taken by Board of Dij5e<tiors_f'«.?['}::ei*efore, petitioners }.'a.11ci 2 had 30 {ole to play to grant loan. to accuseci 1103.1 and 2 had V .V the é;pg:b§ai 'Ear all the Directors of the bank. It is hardly 110% that petitioners had connived with accused n'"o.e'."}"e::;d 2. Petitioirxers 1 and 2 have nothing to do with the VT resolution dated 24.11.95 and 28.12.1996 which are stated A. to have been spuxtiously brought into existence by accused 1103.1 and 2. TU. 5&5' £"'""'""{""

7. The learned Counsei would 31§1€"" _ 'loan raised by accused 17103.1 company for the puirpose for which---,'1'fV.was Company had not raised the other hand when the of loan, the Company of ebjections including def:é§¢1V~.2{t__,%j;;'1VV;95 and 25.12.95 to 4' V'

8.._. _ }ca'fne<i..: {}eyen1ment Advocate would justify the H u in c$iti«er___t0 appreciate these submissions, it is '13.eCess;:t:f§*~etee,i'n'1a_ke brief reference to the facts as found in sander section 173(5) (3r.f-KC.

relevamt period accused 1303.1 and 2, namely, V' V' .. V'ij:;iy& Venkatrao Kamat and Srinivas Ramakant Naik were 'Execuﬁve Directors {sf M/s Murdeshwara Foods and Ltd, Gekul Road, Hubli. The Company was engaged in yroducﬁon and extract of sea foods. At this juncture it is relevamt to state accused no.2 was aieo one of the a'\--'» czjme §'WA**~ Directors of KDCC Bank of which poﬁtionor no.1 Chairman ané petitioner no.2 was the Managing_ _ the nelevant yoriod.

On 24.11.95, accused nosﬁl' 3 i'-§;1.iof existsnce spurious mso}uﬁon"oaig heﬁrc Vbeeo * the Board of Diroc:'£ors'_ of M] Foods and Exports Ltd. In :fe:>«oIz1tio:oV the said Company had resolved lakhs from moo Zaaima ooﬁétriicﬁon of"poi1ds on Kizeaani village, which wozo by them. Simﬂariy, accused no's;,1'van£i it grissed axzother resolution dated which the Company had msoived to of R350 lakhs fmm the KDCC Bank.

' ' It vis3't1§5o'oase of the prosecution during relevant timtit E» ",};3€titio:1o:'L";§vas Chaixmem of KDCC Bank and petitioner no.2 A "::"F~g'Iax2,aging ¥§)ircctor of KDCC Bank. Amused no.2 who ' was the Executive Qizoctor of M} s Muztloshwazra Foods and .4 Ltd., was also one of the: Directors of KDCC Bank. Petitioners 1 and 2 knowizlg fuﬁy W611 that msoiutions dated {V ¢;-4;/vx[3*'vv~5L.\_ : 8 : 24.11.95 arid 28,12«}99:"3 were spuricms documents:-.___they did not have the concurrence of all the Directers of and they were brought into existence at '£}:.1c": ' accused 1103.1 and 2 to raise 10:-;;n~»w0f' V KDCC Bank in order to def1'aud ":.tI:1¢_ Mmdeshwala Foods and £0 = L' sanction loan. Peﬁtioeers 3 'k!1_:1):(}I3§AVvVi*.s3311I*i01:s resolutions dated 24.1V1';§§Z« sancﬁened loan 0f 123.300 lakhs to M/s A§m~aieghwa;a_ Exports Ltd represegted. asd 2.

10. 2 ai1deitAA~x?er:5f1ca1:ion it was found that these ., msgiiiﬁeﬁa yvereAAi1c.:?;...passed by the Board of Dixectors on the the Board of Dizeetors had not held any mr.:e'tii:g.v "§§1f;.eVAf3{§n<is which were intended 1:0 be constzucted by had. aiready been constructed. Themfoxe, V' was ioéged against accuseci 1 and 2 and f;et'ifi£:A-ners 1 and '.2 (Accused 5105.3 <35. 4). It is aiieged " '§e%:£ﬁoners I amt! 2 has': conniveé with accuseé. 1103.1 and 2 to sancﬁoxz £033: on the basis (sf sgaurious resolutions without ascertaining the gemzixgeness or vaizidity of the resoiutions. N : 9 : Therefom, petiﬁoners 1 and 2 are arrayeé as accused 1103.3 and 4.

11. This is a warrant case instituted _ report. The discharge of accused 'w 2 govemcé by provisions of S€C'{1iO;i% hi Section 23§ Cr.P.C. reads that;

"Z39. Wh~gn'~~acc'§nsed_$hall"h-3 dis3::harged.- if, ugon Consideiingflihe a.-*1VVd"'the documents sent with "it ~..zV1'ir:i-5;' '~se.:rc$:3'v:}11"*_ '1.'_73_' and making such exammaﬁoil, if,_tI:1e acicuaeci as the Magistrate i1sce43':3;3iYy the prosecution and the acé:':1és.eéV'V.a11--. 0:pp01"tunity of being heard, the N1'agist:ate"c¢~';:;Sidci's__ﬂ2e Chazge against the accused to be' gxﬁuzzxilcss-,' '-he" discharge {he accused, and Ivecoid his IeasO31SVfpi' so doing."

" '~ Cr. v--%ads thus:

" F.'raming of charge.-- (1) If, upen such. ce.z:1sj;:¥e1}atibn, examination, if any, and hearing, the . Maﬁéixaié is of opinien that there is ground for pﬁésuniing that the accused has committed an offence triable unéer this Chapter, which such Magisuate is ' x T competent to try and which, in hi5; 01I}iI};i£}I}, cauld ha ~ ' adequately' garnished by him, he shall frame in writing V' -- fa charge against the accused. ' (2) The charge $1133.} than be maci and expiained is the accused, and he shall be asked whether he pleads guilty of the oﬁcnce charged or ciaims to be 'tried?' 1r'\J. ,W.»Luu : 10 : Therefoxtt, it is necessary to considm" the docunqents filed under section 173(5) Cr.P.C. to ﬁnd out if grounds to presume that petzitionczs 1 and 2 ~ offences alleged against them. _ . V. "

12' At this juncture it is court has to consider u1'?é3(5} " L' Cr.P.C to find out if t1;¢;~e fdf that accused have comn1itté(EV oﬁ'énci%s. ..>f1:ia_ble under this chagaten ~~~~ 'tGVmé§ke a critical analysis of the do§:1;n;¢nts' 'ﬁ1;gsi:'__'s¢cr;1on 1'z3{5) Cr.P.C. The defence thuat_ 23:;;a§; to I113 accused d1::ring trial _ . _ need §--p<>t"b& coI1Sid.c:1fed.,. {E the statement of PW.1 Amanda Shetty, s Murdeshwara Foods and Exports Ltci We thaﬁi-paiifioners 1 and 2 (accused I1OS.3 and 4) had " ' iﬁtﬁ conspiracy with accused $103.1 emd 2 to ' séfnction loan an the basis of spurious I'6$O11}.ﬁ€}I'iS datzzd 24.11.95 and 28.12.95. C3\V.1 has stated that whenever loan is demanded from the Company, the bank was bound to :1}:

scrutﬁnise the appiications with zweferemze: to the' res§5ie:3t§:*--.>1i:s-- V. passed by the Baaxﬂ of D§I'€Ct{31'S. Etitis alga riéé€:'s;%§'a}:j?"ihvi'Aﬁ1a' bank to consﬁer if the xssolution has I3L.%;"£:£aT'; pa:3_sc3€i ';2:cFi3tV?:{ir1it17%.;~;_' to rezisvant provisions of t.he' V_Ci4:>1.;t1pa"1i:i:=::'V~$ A<:t: : hés ; stated during mlavagt 'h ' _§3ri11ivasa Ramakanth Naik was v<:$1:vz:V=::" jof of KDCC Bank. The 13* petitizmer.(3r.'I'.ljI::gd;.c::'w§:§ éyofkiﬁé. the Chailman and 2nd working as the Petitioners 1 and 2 (1121 no' Wfﬁsolutions dated 24.11.95 and 28.Ai'2,f§5. with accused 1103.1 and 2 to sanction lizaq to th$'co.i11fpany on the strength of spurious

- dggg-g_1.né§itsVVAaI;d apfiféfﬁﬁate the money among$t ﬂ1€H1§$(':lV€S. .T'I[;§: s.tat€me1::t of C.W.2 Ramak Nanjaypa Shetty, wk; vysiéa 053% ef the Directors of the Company, would reveal thag ré$b1uti0ns clatcd 24.11.95 and 28.12.95 are spurious 'dssictimcxtzts. In fact 'metre was 1123 meeting halé an 28.12.95. He has stateci Whenever appﬁcations are fled by the Cc>m}:3az1y for sanction of ican, pcrgons who are in charge :31' day-to~day aﬁ'ai:rs of the Bank are supposed te _vv::r1'fy the W gem avwm :12: gonuineness and vaiidity of the resolutions. "

stated that accused no.2 S1im'.1rasa»~N.aii; ' Executive: Director of M/s Mmdosﬁwaié: Lté, was 3330 one of the _ tho " L' Petitioners 1 and 2 had "'s'§'_vit]f3..E"3.{"3C1:Zv.§':sC3q.vf§ no. 1 to sanction loan on the stxenrgth s:p;119ioV§1:~:A resolutions.

15. '1']:;t3« 'éifateméont venkataramarn Softy, who W.'-.13' M] s Mmdeshwaxa Foods :ii;.td,"'ai{o1i1d that before: sanctioning ' the Ioa;o--._or1 me siéi¢n:gth"1"or}¢g.51utions dated 24.11.95 and 28.11.95 2 had not ascertained from {he _ of ,{;o__mpany about the 10311 applications hank. They had not veriﬁed if resolutions

28. 12.95 had been passed in aocordanot: V . provisions of Companirzs Act and they had . V¢(}I?«i?1§¥I'I't'VfiiC€ of the Board of E)ir€::::tors. Petitioners 1 and 2 _ Waré that 23¢ accused was one of the Executive VT -iZ}iiV:t:ctors of M/s Murdcshwam Foods and Experts Ltd and " fte was also one of the Birectozs of KDC€ Bf;-lrik. Petitioners 1 and 2 who wore Chaizman and Managing i3ir<:-zo-tor of KDCC TU £7'-/'"'"C'(£"' ' :13: Bank, eomzived with accused 1193.1 and 2 aad took iiaiiiaiiafe to saneti-en loan on the basis of epurious . cause Wrongful loss to the said Comgeny and * _ u

16. At this }I1ﬂCtﬂf€,~'it'.jS reievéilat; :c.»"§t;;£¢M Bank is a eomnperative bank. ioegn it has to follow norms of 3; M/s Murdeshwara Pages been enrolled as per '? ]:1e.:_" coileeted during invesﬁgeﬁqe 1 accused $103.1 313.6 2 had brought 'hate eriisteﬁee resolutions. Petitioners 1 and whﬂe 1053 to the accused 1103.1 and 2 had of banking lavsya anti also ruies and fN.e§BARD, Therefore, considering the facts and appearing against petitiozzers in the recorded during the ceurse of inveetigation, it is A m';t_ ﬁessible to hold that charges against petitioners are mgjieunéiess. On censideratien of the maiextial on recoznd, i am of the epimon that there are grounds fer presuming that petitioners have committed offences aiieged against them. N [gee/W4»

18. In the result cnm' 1:3' 31 revision pejrifiiorxi « V' dismissed. Oﬁice is digested to send bae1§._t.h& w'tha oftlis rd . V' sub /

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