Karnataka High Court
V C Ram Mohan vs Central Bureau Of Investigation on 20 August, 2019
Author: K.N.Phaneendra
Bench: K.N. Phaneendra
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 20TH DAY OF AUGUST, 2019
BEFORE
THE HON'BLE MR.JUSTICE K.N. PHANEENDRA
CRL.P. No. 6522/2018
BETWEEN:
V. C. RAM MOHAN
S/O SHRI. V. C. SRINIVASAN
AGED 50 YEARS
R/A FLAT NO. 208
NIDHI APARTMENTS,
40, NETAJI ROAD, FRAZER TOWN
BENGALURU - 560 005
... PETITIONER
(BY SRI. GANESH KUMAR R., ADVOCATE)
AND:
CENTRAL BUREAU OF INVESTIGATION
BENGALURU, (REP. THROUGH
SPECIAL PUBLIC PROSECUTOR
HIGH COURT OF KARNATAKA
BENGALURU)
... RESPONDENT
(BY SRI. PRASANNA KUMAR P. ADV (SPL.P.P.))
THIS CRIMINAL PETITION IS FILED UNDER
SECTION 439 CR.P.C PRAYING TO ENLARGE THE
PETITIONER ON BAIL IN SPL.C.C.NO.231/2018 PENDING
BEFORE THE LXXXI ADDITIONAL CITY CIVIL AND
SESSIONS JUDGE (CCH-82), BENGALURU FOR THE
OFFENCE PUNISHABLE UNDER SECTIONS 120-B READ
WITH 420 OF IPC AND SECTION 13(2) R/W 13(1)(d) OF
PREVENTION OF CORRUPTION ACT, 1988.
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THIS CRIMINAL PETITION HAVING BEEN HEARD
AND RESERVED FOR ORDERS ON 29.07.2019, COMING
ON FOR 'PRONOUNCEMENT OF ORDER' THIS DAY,
THE COURT MADE THE FOLLOWING:
ORDER
This petition is filed under Section 439 of Cr.P.C. for grant of bail in Special C.C. No. 231/2018 pending on the file of the 81st Additional City Civil and Sessions Judge and Special Judge, Bengaluru, for the offence punishable under Section 120(B) r/w Section 420 of IPC and also Section 13(2) r/w 13(1)(d) of Prevention of Corruption Act, 1988 ( for short, 'PC Act').
2. I have heard the arguments of the learned counsel for the petitioner (A3) and counsel for the respondent and perused the materials on record.
3. Before adverting to the grounds urged by the learned counsel for the petitioner and countered by the respondent, it is just and necessary to bear-in-mind the brief facts of the case.
4. In this case, as per the charge sheet, there are eight accused, they are, -
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1) Accused No.1- M/s. VNR Infrastructure Limited (for short, 'M/s. VNRIL') is a company represented by its Managing Director Sri. V. Narayana Reddy along with other 7 persons, who are the Directors and unknown public servants.
2) Accused No.2-Sri. V. Narayana Reddy is the Managing Director;
3) Accused No.3- Ganji Praveen Kumar is the Director and Chief Finance Officer,
4) Accused No.4 is M/s. Andhra Pradesh Industrial and Technical, Consultancy Organization Ltd (APITCO);
5) Accused No.5-MICON is a Consultancy and Engineering Services Ltd.;
6) Accused No.6-M/s. PKNR Estates Pvt. Ltd. Through its Director Sri. Ganji Praveen Kumar;
7) Accused No.7-M/s. Indushree Housing Pvt. Ltd.
Represented through its Managing Director Sri. R. Venkateshwara Rao;
8) Accused No.8 is M/s. RKR Housing Pvt.Ltd.
represented through its Managing Director Sri. R. Venkateshwara Rao.
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5. It is the case of the prosecution that, Accused Nos. 6 to 8 are the land owning companies, who have actually mortgaged the lands belonged to them as security for the loans availed by Accused No.1-Company and they have also furnished Corporate Guarantee for the respective facilities secured by them.
6. It is the further case of the prosecution that, during the year 2014, Accused No.2, who being a Managing Director of the Accused No.1 Company, approached the complainant-IFCI Limited situated at IFCI Tower, 61, Nehru Place, New Delhi, which is represented by Smt. Pooja Tiku, Deputy General Manager (Law), of the said Company, for sanction of loan to the extent of 90 crores for a period of six years repayable in 20 quarter installments with certain conditions for the purpose of executing their ongoing projects and in the meanwhile to meet urgent fund requirements. Accused No.2 misrepresented the complainant-Company that, they would provide adequate security to the said loan and on the basis of the said misrepresentation, at the initial stages, a sum of Rs.90 Crores was disbursed in 5 favour of M/s. VNRIL with repayment schedule of 20 quarterly installments of 4.5 crores each from 15th month of date of disbursement, with some terms and conditions. One of the conditions was that, "Valuation of the mortgaged property has to be carried out by two IFCI appointed valuers and the charges shall be borne by the Company." In this context, Accused No.2 in the name of the Accused No.1-Company got mortgaged four properties situated in Mahabubnagar at Telangana District along with his personal guarantees. Accused No.7- M/s. Indu Shree Housing Pvt. Ltd. and Accused No. 8- M/s. RKR Housing Pvt. Ltd. have also given their Corporate Guarantees. Accused No.4 along with one K. Chandrashekar, an official of Accused No.1-Company valued the said properties at the Distress Sale Value of Rs.231.59 crores. Further, Accused No.5 along with Sri. K. Chandrasekhar, on 12.09.2014 has got valued some properties at the Distress Sale Value of Rs.226.24 Crores.
7. It is the further case of the prosecution that, in the month of April 2015, Accused No.2 on behalf of 6 Accused No.1-M/s. VNRIL, approached the complainant- Company with a request for corporate loan of Rs.100.00 Crores for fulfilling their objectives, by offering security of property situated at Rajabollarum Village, Medchal Mandal, Ranga Reddy District, Telangana, mortgaged by M/s. PKNR Estates Pvt. Ltd. and the same was also valued by Accused No.4 and the Distress Sale Value was to the tune of Rs.256.39 crores. The said loan was also sanctioned. It appears totally Rs.190.00 crores of loan has been obtained by Accused No.2. In that context, it is the case of the prosecution that, Accused No.3, the present petitioner, being a public servant, while working as the then DGM of IFCI Limited, Regional Office at Bengaluru, knowing fully well that the said properties which were offered for security would not fetch the value as recommended, by abusing his position as a public servant for consideration, has recommended for sanction and disbursement of the credit facilities to Accused No.1-M/s. VNRIL, which is represented by Accused No.2. It is also alleged that, the petitioner (A3) was instrumental in arranging and accepting inflated 7 valuation reports in favour of the borrowers and for that purpose, he has taken Rs.5.24 Crores cash as illegal gratification by way of commission for recommending and arranging said loans in favour of Accused No.1. It is further alleged that, the petitioner has processed the loan for obtaining the approval from the Screening Committee knowing fully well that the security offered was not properly valued and they are all bogus. It is further contended that, the immovable properties by M/s. Indushree Housing Pvt. Ltd. And M/s. RKR Housing Pvt. Ltd. which were offered as security cost only Rs.31.13 Lakhs only, during 2005 to 2007. Whereas, it was abruptly raised showing that, the properties worth Rs.257.32 Crores and also 230.72 Crores respectively. Therefore, there was imaginary and wrongful inflated- value shown with regard to the value of the properties. It is also alleged that there was a huge inflation in evaluating market value of collateral security. In turn Accused No.2 has made all possible inflation colluding with the petitioner (A3) by entering into a criminal conspiracy and thereby the petitioner has abused his 8 official position to facilitate Accused Nos. 1 & 2 in procuring the loans. On these allegations, a complaint has been lodged and after thorough investigation, the charge sheet has been laid against the petitioner (A3) and other accused persons.
8. It is also worth to note here that the complainant - company having found that the loan amount has not been re-paid as per the terms and as there was default, they issued legal notice to Accused Nos. 1 & 2 requesting for repayment of loan. As the same was not paid, the complainant-company declared the said loan as NPA on 15.03.2016 and issued notice under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 for recovery of the said loan. Subsequently, the complainant-company came to know that Accused No.2 in collusion with Accused Nos. 3 to 5, got valued the said properties at inflated value, though the said properties were not fetching that rate of value as noted above. Therefore, they found that there was a collusion between Accused Nos.1 to 5 with an intention to cheat and 9 deceive the complainant-Bank. Therefore, on the above said allegations, the investigation has been done and charge sheet has been filed.
9. Learned counsel for the petitioner (A3) has strenuously submitted before the Court that, the petitioner was not the sole person to sanction loan and the Screening Committee has to screen the recommendation and thereafter loan had been sanctioned. After accepting evaluation report given by two persons, the recommendation has been made for sanction of loan. The Valuation Reports was legally obtained for sanctioning of the loan, therefore, there is no role of the petitioner (A3) in sanctioning the said loans, but, he only recommended for sanctioning loan. Therefore, the role of the petitioner (A3) is very minimal. The power of sanctioning the loan was only entrusted to the committee and not the petitioner (A3) and the petitioner (A3) was not a member of that committee. 10
9.1. The learned counsel also contended that, the complainant-company is a private organization, therefore, the P.C. Act is not applicable.
9.2 Further, the learned counsel contended that, the allegation of receipt of Rs.5.24 crores commission, made against the petitioner (A3) has not been established and no material is available on record to substantiate the same.
9.3. Apart from the above, learned counsel also contended that Accused No.2 stands on different footing when compared to this petitioner, who is arraigned as Accused No.3. Therefore, rejection of the bail petition to Accused No.2 will not come in the way of granting bail to this petitioner. Moreover the aspect of collusion between Accused No.2 and this petitioner is not established. It is further contended that Accused No.2, in fact, has approached this court and got the stay of entire proceedings before the trial Court. Therefore, the trial may take lot of time and that is also a ground for granting of bail to this petitioner. It is further contended 11 by the learned counsel that, the petitioner's father is aged 85 years and mother is aged more than 80 years and they are sufficiently old. Therefore, by showing the photographs of the old parents of the petitioner (A3) before this Court, the learned counsel contended that the petitioner is the only person, who has to take care of his parents at the end of their life. Therefore, it is a fit case where bail has to be granted on conditions even on humanitarian ground also.
9.4 Further, the learned counsel also contended that, the respondent-CBI has been taking time for the purpose of filing additional charge sheet by further investigating the matter. That shows that, they have filed incomplete charge sheet. Therefore, they cannot gain time like that on the guise of filing additional charge sheet. It is also a ground for grant of bail.
9.5 Last but not least, the learned counsel submitted that, the petitioner (A3) is permanent resident of the address shown in the petition and he is always ready and willing to offer substantial surety for his 12 appearance and he would readily co-operate with the trial court for expeditious disposal of the case and he would abide by any of the conditions that may be imposed by this court, hence prayed for grant of bail to the petitioner(A3).
10. Per contra, the learned Special Public Prosecutor Sri.Prasanna Kumar submitted that, Accused No.1-Company represented by Accused No.2 has taken loan for completing existing railway project. Complainant might have refused for grant of Rs.190 cores on two occasions, if the petitioner would not have recommended for the same. When petitioner was working as DGM, he was the incharge of loan processing. He is the person who has to examine each and every document before recommending for sanction of loan, because such a huge amount has been sought for as loan and furnishing of the security is an important factor, that ought to have been carefully scrutinized by this person with reference to the valuation of the properties. The petitioner himself has appointed Accused Nos. 4 & 5 for conducting evaluation after verification of the distressed value of the properties 13 which should be 2.5 times more than the loan amount. In fact, the properties offered as security by Accused Nos. 7 & 8 only worth Rs.31.13 Lakhs, as against 257.21 crores, which was wrongly valued. He further contended that, if these valuation were not available at the time of recommendation and they were obtained after the recommendation for sanction of loan, the collusion can be prima facie apparently inferred between Accused Nos.2 and this petitioner (A3). The valuation reports are also not fair and CBI suspected that the said alleged documents were also not property executed and they are alleged to be fake and forged. Therefore, further investigation is yet to be done and CBI has sought for time to file additional charge sheet.
10.1. The learned Special Public Prosecutor has further submitted that, Accused No.2 has approached this court for grant of bail. In fact, by a detailed order in Criminal Petition No.6152/2018, this court has dismissed the said petition. Being aggrieved by the same, Accused No.2 has approached the Hon'ble Apex Court and in fact, the Hon'ble Apex Court has not granted bail to Accused 14 No.2, but, it directed the CBI to file additional charge sheet. When the bail petition of the co-accused is dismissed and there is an observation by this court that there was collusion between Accused Nos.2 & 3 with the help of other accused, the allegations made against this petitioner (A3) cannot be bifurcated for grant of bail. Therefore, on that score, the petition is liable to be rejected.
10.2. The learned Special Public Prosecutor has also contended that, there are sufficient materials placed before the Court to show that the petitioner is the recipient of about Rs.5.24 Crores as commission and an amount to the extent of Rs.78.00 Lakhs has been deposited to the petitioner's father's account and a sum of Rs.28.00 Lakhs has been deposited in the name of petitioner's wife's account. Therefore, these strong prima facie factual aspects are established against the petitioner and the same have to be established during the course of the trial. There is no explanation by the accused with regard to the said amount, which abruptly came to the account of his father and his wife. Though it 15 is true that the father and the mother of the accused were aged, of course they are being taken care of by the wife of the petitioner (A3) through out and therefore, that cannot be a ground for grant of bail.
11. Learned counsel for the petitioner has relied upon the principles laid down by the Hon'ble Apex Court in Special Leave Petition No.6453/2015 between Achpal @ Ram Swaroop and another Vs. State of Rajasthan, wherein the Hon'ble Apex Court has stated that, -
"There may be practical difficulty in completing the investigation within the stipulated time. The extension of time for filing of the charge sheet may result in maximum period becoming the rule in every case as a matter of routine. Therefore, once the charge sheet is filed, if it is incomplete, then Section 167 of Cr.PC. can be exercised."
12. In my opinion, the said ruling has no application to this case, for the simple reason that, it is not the case of CBI that, the charge sheet filed by them was incomplete, but they only stated that, they would file 16 additional charge sheet. Moreover, the petitioner has not approached the trial Court under Section 167(2) of Cr.PC. Therefore, the said argument of the learned counsel is not tenable.
13. In another ruling reported in 2018(3)SCC 22 between Dataram Singh Vs. State of U.P., the Hon'ble Apex Court has observed that, -
"While granting bail, the court has to consider the need of human approach and while dealing with the applications, the presumption of innocence should always be in favour of the accused. Nevertheless, grant of bail is the rule and refusal is the exception, however, the grant or refusal of bail is entirely the discretion of the Judge and it must be exercised in judicious manner. The Court has observed that, when there is assurance to the Court that the accused will not abscond and he will appear regularly to the court, then normally bail should be granted. However, said observation should not be understood or mean that, bail should be granted in every case. However, it is left to the discretion of 17 the court depending upon the facts and circumstances of each case."
14. The above said ruling cited by the learned counsel would only show the general principles laid down by the Hon'ble Apex Court, but, the court has to see the facts and circumstances of each case to grant or not to grant bail. In this context, learned counsel for the respondent has also relied upon a ruling reported in 2013(7) SCC 466 between Nimmagadda Prasad Vs. CBI referring to the white collar crimes, the relevant portion of which at Para-24 & 25 reads as under:-
"24. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations. It has also to be kept in mind that for the purpose of granting bail, the legislature has used the words "reasonable 18 grounds for believing" instead of the "the evidence" which means the court dealing with the grant of bail can only satisfy itself as to whether there is a genuine case against the accused and that the prosecution will be able to produce prima facie evidence in support of the charge. It is not expected, at this stage, to have the evidence establishing the guilt of the accused beyond reasonable doubt.
25. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offence having deep rooted conspiracies and involving huge loss of public funds needs to be viewed seriously and considered as a grave offence affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country."
15. Bearing in mind the above said principles laid down by the Hon'ble Apex Court, now let me consider the factual matrix of this particular case.
16. On over all analysis of the entire charge sheet papers and the allegations made therein, it is clear that the prosecution has prima facie shown to the Court 19 that, Accused No.1 is a Company and Accused No.2 was its Managing Director and Accused No.3 (the present petitioner), who was working as a DGM of the Bank, in which Accused Nos. 1 & 2 have taken loan and Accused Nos. 4 & 5 are the technical consultancy organizations and Accused Nos. 6 to 8 are the guarantors, who mortgaged their property as security for the loans availed by Accused Nos.1 & 2. It is also established prima facie by the prosecution that, the loan was taken to the extent of 205.20 crores, which is a very huge amount. It is evident from the records that the properties offered as security at the distressed value shown at 205 times more than the loan sought for. Therefore, Accused Nos.1, 2 & 3 must have been very careful, particularly Accused No.3, the petitioner herein, must have been very careful while recommending for grant of loan to examine as to, whether the properties offered were worth more than 205 times than the loan amount. In this context, the allegations are very serious and Accused Nos. 1 & 2 have evaluated the property at the instance of Accused No.3 (the petitioner herein) 20 through the evaluators, who have actually valued the property at the distressed sale value at Rs.256.39 crores so far as the first loan of Rs.90.00 crores is concerned and Accused No.4 has given his valuation sofar as that loan is concerned. Accused Nos. 4 & 5 have valued the property at the distressed value, pertaining to the second loan amount of Rs.260.67 crores, though they knowing fully well that these properties were not fetching so much of distressed sale value and thereby there was serious lapses on the part of Accused No.3, as alleged by the prosecution.
17. It is argued by the learned counsel that the said valuation was given after the recommendation made by the petitioner and thereafter, the amount was released in favour of Accused Nos. 1 & 2. If this argument were to be accepted, there is further dereliction of duty on the part of the petitioner because, how he can make such recommendation before evaluating the secured property and without ascertaining whether the said security worth 205 times more than the loan amount. Of course, the bank authorities have got all 21 the authority to recover the said money from Accused Nos. 1 & 2 by going against the secured properties and also even their individual properties and other properties belonging to the Company. But, that itself will not absolve the liability of Accused Nos. 2 & 3 if they are really intended to cheat the bank by means of providing security of the properties which are not sufficient to recover the loan amount and which is secured at very much less distressed value, compared to the loan amount sanctioned. Therefore, merely because of alternative remedy is available to the Bank, that itself is not sufficient to draw an inference that the accused can absolve themselves from their liability.
18. Of course, the learned counsel for the petitioner has argued at the initial stages that, the complainant-company is not a registered company as on the date of loan, but subsequently, it is clarified that, as on the date of release of the loan amount, the said legal requirement was fulfilled. Therefore, that ground, for the present is not available to the petitioner. 22
19. So far as the other argument is concerned, the bail petition of Accused No.2 was rejected and the same has no bearing on the part of this petitioner. In my opinion, definitely the rejection of the bail petition of Accused No.2 will have a serious bearing on this petition also. As could be seen from the allegations, it is not an isolated or separate or distinct allegation made against the petitioner. It is succinctly and specifically alleged that, Accused Nos. 1 to 3 have colluded with each other along with other accused persons for the purpose of granting loan to Accused Nos. 1 & 2. The allegations are inter-twined and inseparable in nature. Even at this particular point of time, the allegations against Accused No.3 in order to facilitate Accused No. 2 is accepted i.e., the loan application is recommended even without taking the security and evaluation made so far as secured properties concerned, that itself shows that the allegations are severe in nature. Therefore, once the bail petition of Accused No.2 is rejected, the allegations cannot be bifurcated at this stage for the purpose of granting bail to the petitioner.
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20. The next point raised by the learned counsel is that, it cannot be said that, the investigation has not been completed and the respondent-CBI on that ground, cannot prolong the matter. In this context, he has already relied upon a decision noted above. But in my opinion, the said decision is not applicable. It is not the case of the respondent-CBI that there was an incomplete charge sheet filed by them earlier.
21. Last but not least, the learned counsel submitted that, there is no material placed before the court as to the alleged bribe amount given to the petitioner herein to the extent of 5.24 crores. It is the allegation of the respondent that, the lump-sum amount of Rs.75.00 lakhs and Rs.28.00 lakhs have been respectively poured into the account of the father and wife of the petitioner respectively during the relevant time. That requires to be explained during the course of full-dressed trial as to how such a huge amount came to the account of his father and wife, who are actually not earning members in the family. Though the learned 24 counsel contended, that the petitioner's father is having a large number of agricultural properties and he has received the amount from them and wife was also doing some business and she acquired the said amount out of her own earnings, these factors have to be established during the course of trial. As on the date, no such materials are placed in the charge sheet so as to consider the said aspect, and therefore, that ground is also not available to the petitioner herein.
22. Another submission regarding the old aged parents of the petitioner made by the learned counsel is concerned, in my opinion, it is also not tenable. Of course, the petitioner has produced several photographs showing that his parents are very old aged and on seeing the photographs, of course there is no doubt that the parents of the petitioner are unable to take care of themselves. However, the petitioner has been arrested long back and since then, his wife has been taking care of his old aged parents and moreover no serious ailment or disease has been complained in so far as his parents are concerned, so as to release the petitioner on bail, so 25 that he can take care of his parents through-out their life. Therefore, looking to the above said circumstances, it is specific and clear that the bail petition filed by Accused No.2 in Criminal Petition No.6152/2018 on 14.02.2019 is rejected and against that order, Accused No.2 has preferred a Special Leave Petition before the Hon'ble Apex Court and the same is pending for consideration. Such being the circumstance, at this stage, it is not proper and correct for this Court to release the petitioner (A3) on bail. Therefore, in the above circumstances, the petition is devoid of merit and the same is liable to be dismissed.
Accordingly, the petition is dismissed.
Sd/-
JUDGE KGR*