Gujarat High Court
Bholabhai Valjibhai Patel vs State Of Gujarat & ... on 24 December, 2014
Author: S.G.Shah
Bench: S.G.Shah
R/CR.A/1999/2012 CAV JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
CRIMINAL APPEAL (AGAINST CONVICTION) NO. 1999 of 2012
With
CRIMINAL APPEAL NO. 2000 of 2012
With
CRIMINAL MISC.APPLICATION NO. 19827 of 2013
In CRIMINAL APPEAL NO. 2000 of 2012
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE S.G.SHAH
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1 Whether Reporters of Local Papers may be allowed to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of the judgment ?
4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ?
5 Whether it is to be circulated to the civil judge ?
================================================================ BHOLABHAI VALJIBHAI PATEL....Appellant(s) Versus STATE OF GUJARAT & 1....Opponent(s)/Respondent(s) ================================================================ Appearance in Criminal Appeal No.1999 of 2012:
MR ND NANAVATY, Sr.Advocate with MR YV VAGHELA, ADVOCATE for the Appellant(s) No. 1 MR RC KODEKAR, ADVOCATE for the Opponent(s)/Respondent(s) No. 2 MS HANSA PUNANI, APP for the Opponent(s)/Respondent(s) No. 1 Appearance in Criminal Appeal No.2000 of 2012 MR SV RAJU, Sr.Advocate with MR RAJESH KANANI, ADVOCATE for the Appellant(s) No. 1 MR RC KODEKAR, ADVOCATE for the Opponent(s)/Respondent(s) No. 2 MS HANSA PUNANI, APP for the Opponent(s)/Respondent(s) No. 1 Appearance in Criminal Misc.Application No.19827 of 2013 MR SV RAJU, Sr.Advocate with MR NIKHIL S. KARIEL, ADVOCATE for the Applicant(s) No. 1 Page 1 of 37 R/CR.A/1999/2012 CAV JUDGMENT MR RC KODEKAR, ADVOCATE for the Opponent(s)/Respondent(s) No. 2 MS HANSA PUNANI, APP for the Opponent(s)/Respondent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE S.G.SHAH Date : 24/12/2014 COMMON CAV JUDGMENT Both these appeals are arising out the common impugned judgment and, therefore, they are heard and disposed of by this common judgment. The appellant in Criminal Appeal no.2000 of 2012, namely, Ranchhodbhai Bhudarbhai Methania was accused no.1 whereas appellant of Criminal Appeal no.1999 of 2012, namely, Bholabhai Valjibhai Patel is accused no.2 in CBI Special Case no.36 of 1994. Both of them are convicted and sentenced for the offences punishable u/ss.201, 467, 468, 477A, 511, 420 and 120B of the IPC by impugned judgment and order dated 20.12.2012 by Special Judge, CBI Court no.2, Ahmedabad. They are convicted and sentenced as under:-
i. For the conviction under Section 467, IPC, applicants are convicted to undergo simple imprisonment for 10 years and to pay fine of Rs.5,000/-, and in default of payment of fine, to undergo simple imprisonment for further three months; ii. for the conviction under Section 468, IPC, the applicants are convicted to undergo simple imprisonment for seven years and to pay fine of Rs.3,000/- and in default of payment of fine, to undergo simple imprisonment for two months; iii. for the conviction under Section 511 read with Section 420 of IPC, the applicants are sentenced to undergo simple imprisonment for three-years-six- months and to pay fine of Rs.1,500/-, and in default of payment of fine, to undergo further simple imprisonment for one month;
iv. for the conviction under Section 201 of IPC, the applicants are sentenced to three years simple imprisonment and to pay fine of Rs.500/- and in default of payment of fine, to undergo simple imprisonment for a period of one month; v. for the conviction under Section 120-B of IPC, the applicants are sentenced to undergo simple imprisonment for 10 years and to pay fine of Rs.3,000/- and in default of payment of fine, to undergo further simple imprisonment for two months;
vi. as far as accused No.1 is concerned, he is also sentenced under Section 13(2) of the Prevention of Corruption Act, 1988 to undergo simple imprisonment for seven years and to pay fine of Rs.3,000/- and in default of payment of fine, to undergo further simple imprisonment for two months.
2. By consent of the parties, both the appeals are heard together for final disposal whereby learned senior counsel Mr.S.V.Raju and learned Page 2 of 37 R/CR.A/1999/2012 CAV JUDGMENT senior counsel Mr.N.D.Nanavaty have submitted their case for accused nos.1 and 2 respectively, whereas learned advocate Mr.R.C.Kodekar has submitted the case for C.B.I.
3. I have considered the rival submissions and perused the record in the form of paper-book, which contains all documentary evidence produced and proved by the prosecution before the trial Court as well as all the oral evidence of witnesses and impugned judgment.
4. It is the case of the prosecution, stated in nutshell, that accused Nos.1 and 2 entered into criminal conspiracy to defraud the State Bank of Indore seeking to raise loan for the amount of Rs.04,38,00,000/- (Rupees Four Crore Thirty Eight Lakhs) and to get sanctioned the said loan on the basis of six fake Term Deposit Receipts (TRDs), also termed as FCNR worth US $ 22.94 lakhs. The accused No.1-applicant of Criminal Miscellaneous Application No.18504 of 2012 was working as Assistant Manager, NRI Division, State Bank of India, Main Branch, Bhadra, Ahmedabad, and was in charge of of blank bank securities, whereas accused No.2-applicant of Criminal Miscellaneous Application No.18501 of 2012 was the intending loanee, who was indebted to the tune of Rs.02,57,00,000/- (Rupees Two Crore Fifty Seven Lakhs). By raising loan from State Bank of Indore, Ahmedabad, on the basis of six FCRNs to be offered as security, he wanted to repay his existing loan as well as he wanted to purchase new properties-diamonds. He was Director of M/s.Mahalaxmi Diamond Industries and was in that business.
4.1 It is further stated that both the applicants-accused hatched conspiracy to secure loan from State Bank of Indore, wherein the accused No.1-
Assistant Manager, prepared FCNRs (TDRs) in the fake names of persons and list of such fictitious persons came to be forwarded to the officer of State Bank of Indore in the process of getting the loan sanctioned by accused no.2. It is the case of the prosecution that entries of Page 3 of 37 R/CR.A/1999/2012 CAV JUDGMENT six FCNRs bearing Nos.213657, 213656, 213673, 213674, 213672 and 213675 were made in the Index Register of the bank by accused No.1- Assistant Manager in his own hand-writing and subsequently the entries were cancelled. It was also revealed further that the applicant-accused No.2 along with accused No.3, who has been absconding, visited the head office of State Bank of Indore at Indore, held negotiations for sanction of loan on the basis of the said FCNRs. The competent highest level of the State Bank of Indore was persuaded for sanctioning the loan and the loan came to be sanctioned as per the sanction letter dated 06 th October, 1990. The sanction was given on condition of placing the FCNRs as collateral security and the details about the depositors' genuineness, etc., were to be verified as per Bank's procedure. However, the accused no.2 did not turn up to receive the disbursement of the loan amount. The FCNRs stated to have been prepared were never brought forward and the same were stated to have been cancelled.
5. As against that the submission by the accused are to the effect that they have not committed any offence inasmuch as, it is not the case that accused no.2 has not turned up to accept the amount, which is already sanctioned in favour of his industry, but, in fact, he has conveyed the bank that he does not want to avail the loan facility. It is submitted that when accused no.2 could not produce the FCNRs against which he has requested for the loan and, therefore, when no loan has been accepted by him, there is no loss of a single rupee to either of the bank and that at the most it can be said that accused no.2 has though submitted a loan application, the same was not availed though sanctioned. Therefore, it does not amount to cheating or offence as alleged by the prosecution.
6. To understand the rival submission, we have to recollect certain Page 4 of 37 R/CR.A/1999/2012 CAV JUDGMENT factual details. It is not disputed that firm of accused no.2 has already obtained loan from State Bank of Indore and they were also guarantor to some of the loans disbursed by the State Bank of Indore and they have to repay such loan. It is also not disputed that for repayment of previous debt and for doing a new business of diamond, the firm of accused no.2 had applied for loan from State Bank of Indore. It is also not disputed fact that State Bank of Indore has sanctioned loan of approximately Rs.4.5 Crores in favour of the firm of accused no.2, when accused no.2 approached the bank for sanction of such loan against FCNR deposit receipts aggregating to US $ 22.94 lakhs which are in the name of other third parties. It is also not disputed that as per the accused no.2, such FCNRs have been issued by the State Bank of India, NRE Division of Ahmedabad Branch. The accused no.2 has requested the State Bank of India to allow advance upto 75% of the FCNR value in Indian rupees confirming that out of the proposed loan, a part of amount will be deposited towards the liquidation of the accoutns with the said bank. It is also not disputed that for the purpose, accused no.2 and one another Director of his firm had visited the State Bank of Indore and discussed the issue and accordingly State Bank of Indore has agreed to sanction such loan. Request for sanction of such demand loan against FCNR deposit receipts was made by accused no.2 by his letter dated 21.8.1993 pursuant to discussion held on 21.8.1993, in the head office of State Bank of Indore. Pursuant to such request, State Bank of Indore by their letter of the same date i.e. 21.8.1993 called upon the accused no.2 to submit following information/papers to enable them to submit proposal to their higher authorities for sanctioning the loan:-
"(1) The details of the FCNR deposits. If possible please forward to us copy of the deposit receipts.
(2) The name and address of the person in whose name the deposit stands. (3) The copy of the tender through which the two sick textile mills were Page 5 of 37 R/CR.A/1999/2012 CAV JUDGMENT alloted to you.
(4) How you will pay the loan to be raised by you?
(5) The tentative date by which you have to deposit the amount to the
liquidator/Government in respect of tender approved by them. (6) The copies of the balance sheets and profit and loss accounts of the Mahalaxmi Diamonds (I) Pvt.Ltd. for the last three years."
Thereby, State Bank of Indore has called upon the accused no.2 to disclosed certain facts in details. There are some other correspondence between the parties, but which are not of much material at present. In response to such letter, accused no.2 has vide his letter dated 25.8.1993 conveyed the State Bank of Indore through its Ahmedabad Branch as under:-
"Re: Loan amount FCNR Deposit Receipts.
We are in receipt of your letter No.ADV/679 dated 21 st Aug., 1993 on the above subject and noted the contents carefully.
1) The original FCNR Deposit receipts have been forwarded to the Deposit holder overseas alongwith the Loan application forms given by you for obtaining his signature. The party will forward these documents directly to your bank duly signed by Courier service. There are total six FCNR Deposit receipts totally amounting to US $22,94,317.46 (U.S. Dollars Twentytwo lacs ninety four thousand three hundred seventeen point fourtysix only).
2) Names & addresses of the deposit holders can be known to the bank from the Deposit Receipts itself, on receiving the same from the party.
3) Copy of Tripartriate agreement and letter of acceptance from GSTC, in respect of Ahmedabad Cotton Mills (Bagicha Mills) is enclosed herewith. The matter was delayed due to some legal dispute which is now overcome and we now have to make the payment to take possession of the property.
4) After taking possession of the properties of the Textile Mills on making initial payments, we can generate substantial amounts from the sale of machineries, equipments, furnitures, buildings, lands etc. which will amount in crores of rupees and there won't be any problem in repayment of loan from the funds to be generated from the said assets.
5) We have to deposit the amount with GSTC/Liquidator immediately on hearing from them which we expect will the within next 10/15 days.
6) Copies of Balance sheets of our company has already been given to you yesterday.Page 6 of 37 R/CR.A/1999/2012 CAV JUDGMENT
Hope the above informations will suffice your requirements to process the proposal and favour us with your early sanction of loan."
7. Thereby, it becomes clear and obvious that on 25.8.1993, accused no.2 has conveyed the bank that original FCNR deposit receipts have been forwarded to the deposit holder overseas along with loan application forms given by the State Bank of Indore for obtaining their signatures, and that the parties will forward these documents duly signed directly to the bank through courier service. The only confirmation is with regard to the number of FCNR deposit receipts being six and its amount i.e. total US $ 22,94,316.46. So far as other details of the deposit holders are concerned, it is conveyed that bank would get it from the deposits itself, on receiving the same from the party. Some other documents are referred which are annexed and forwarded with such letter. Therefore, practically, there is no disclosure by the accused no.2 that which FCNRs are to be pledged by him for the loan in question or any details about FCNR receipts including name and details of the holder of such receipts.
8. Whereas, the entire prosecution case rests upon such fact that accused no.2 has applied for huge loan of approximately Rs.4.5 Crores and disclosed the details of FCNR, which he could not ultimately produce for disbursement of the loan. For such disclosure, prosecution case rests upon only one document, which is at Exh.68. If we peruse Exh.68, it is a simple list of six FCNRs with name of depositors, receipt numbers, date of issue and maturity, amount in foreign currency and in Indian rupees and 75% and 50% of such amount. Such list is typed on a simple paper, which does not have any other information except such details i.e. neither letterhead of the firm of the accused no.2 nor on the letterhead of the bank and most importantly, it is not signed or endorsed by anyone. Therefore, though it is alleged and said that this list has been provided by Page 7 of 37 R/CR.A/1999/2012 CAV JUDGMENT the accused no.2 to the State Bank of Indore as proposed FCNRs against which loan is prayed for, the fact remains that, as quoted herein above, by his letter dated 25.8.1993, in fact, accused no.2 has on the contrary conveyed the bank in writing with his signature on a letter issued by him on his letterhead that name and details and other facts of the FCNRs would be known to the bank on receipt of original FCNRs duly signed and pledged in favour of the bank, which are already forwarded to its holder, who are residing abroad. Therefore, there is contradictory evidence so far as disclosure of such details are concerned.
9. In addition to such contradictions, the prosecution has further committed a blunder by examining two witnesses, one at Exh.104 being PW-8, namely, Kamleshbhai Babubhai Gajjar and another at Exh.67 being PW-2, namely, Vijayan Krishnan Iyer. Though document at Exh.68 is a single document of one page, both these witnesses are claiming that they have typed such statement on instructions received from accused no.2. Therefore, again there is a material contradiction in the prosecution case itself and there is no clarification whatsoever in any manner after depositions of two different witnesses when both of them are claiming that they have typed the statement, which is produced at Exh.68. If we peruse both these depositions carefully, PW-2 at Exh.67 states that he was serving as administrative officer with Mahalaxmi Housing and Fin Stock Pvt.Ltd. From 1989 till 1993 as administrative officer and doing general administrative work of correspondence, typing etc. It is his say after referring the document at Exh.68, which was mark 46/3 before his deposition, with details in such statement viz. name of the depositor, date, receipt number, date of issue, date of maturity, foreign currency, Indian currency 75% and 50% in heading that it was typed by him as instructed by accused no.2 and that such details was provided to him on a rough Page 8 of 37 R/CR.A/1999/2012 CAV JUDGMENT page and, thereupon, he typed it by the typewriter of the office and, thereby, such document was admitted in evidence as Exh.68. It is his say that he has handed over such statement to accused no.2 and accused no.2 has directed him to provide such statement to one Chhajed in State Bank of Indore, Relief Road Branch and, thereupon, he provided such statement to Mr.Chhajed in last week of August, 1993. The witness confirms that typewriter by which such statement was prepared was not seized by the C.B.I, though it was checked by them.
10. Whereas, PW-8 at Exh.104, namely, Kamleshbhai Babubhai Gajjar is also claiming that he has typed such statement on receipt of information on rough page from Bholabhai - accused no.2. However, he is referring the order of preparing such statement as that of 1994. He was serving as a typist with M/s.Mahalaxmi Housing and Fin Stock Pvt.Ltd. This witness also confirms that document at Exh.68 does not bear the signature of anyone and he does not remember that when it was typed. He also confirms that there is no name of any of the firm on such statement and there is no rubber stamp and, thereby, it is clear that none of the witnesses have signed such statement, making endorsement that they have typed it with instructions received from accused no.2 and such statement does not disclose the name of any firm of the accused no.2. This witness also confirms that C.B.I has not seized the typewriter from the office.
11. Therefore, only because these two witnesses, who were serving with accused no.2 in the year 1993 and 1994, states that, they have typed such statements on instructions received from accused no.2, it cannot be said that it was only accused no.2, who has given them such instruction and that too when the paper on which accused no.2 has given such details Page 9 of 37 R/CR.A/1999/2012 CAV JUDGMENT is not produced on record. Even such statement does not bear signature of any of the witnesses or even accused no.2 or any officer of the accused no.2 or even the name of firm of accused no.2 and, therefore, it cannot be said that based upon this evidence alone, guilt of accused no.2 is proved in disclosing such FCNR to State Bank of Indore for obtaining loan, when it is alleged that such FCNR was not existing at all. However, it is also a debatable issued that whether FCNRs were not in existence or that holder of such FCNRs were not willing to pledge the same in favour of accused no.2 or that there is a bonafide mistake or error in disclosing such information. There is reason to say so, because, surprisingly, two witnesses are coming forward, claiming that they have typed the single document. Therefore, the question would arise that in fact, who had typed such document i.e. PW-2 or PW-8 and, therefore, it seems that probably both of them are not telling the truth because it is clear and certain that if PW-2 has typed the statement, then, PW-8 is telling the lie and similarly if PW-8 is telling the truth, then, PW-2 is telling lie. Therefore, there is a reason to believe that both of them are not telling the truth and such statement was probably got-up or created for some ulterior motive by either any of the witness or by somebody else. It is settled legal position that when evidence is not trustworthy, then, its benefit will go to the accused rather than the prosecution to extend the benefit of doubt in favour of the accused.
12. Therefore, there is lacuna in the prosecution case, when they are solely relying upon the fact that accused no.2 has prayed for loan of approximately Rs.4.5 Crores against FCNRs and details of that FCNR is incorrect when it was disclosed by the accused no.2. Even for the sake of argument, if we believe that list at Exh.68 was disclosed by accused no.2 to the State Bank of Indore though there is no positive evidence to that Page 10 of 37 R/CR.A/1999/2012 CAV JUDGMENT effect and so far as allegation of such list is concerned, there is contradictory evidence, when accused no.2 has categorically conveyed in writing to the bank by his letter dated 25.8.1993 that original FCNR have been forwarded to the deposit holder overseas along with loan application forms for signature and that bank will get it duly signed in its favour through courier service and that name and address of the deposit holder can be known to the bank from the deposit receipts itself on receiving the same from the party; it is clear that accused no.2 has never intended to disclose any such information before original FCNRs are being pledged in favour of the bank and, therefore, so far as allegations against accused no.2 regarding commission of offence as per charge framed against him, are baseless inasmuch as he has never accepted any amount and he has never produced any forged document before the State Bank of Indore. Suffice to say that Exh.68 can never be said to be a forged document, when it simply discloses certain details. If at all such details are incorrect , when accused no.2 has not come forward with any such FCNRs in forged nature, with endorsement of its pledge in favour of State Bank of India for obtaining loan and when he has refused to avail the loan, it is surprising confirmation that he has committed all such offences as alleged and then to convict him.
13. So far as accused no.1 is concerned, we have to scrutinize the evidence in sequence of witnesses.
14. PW-1 at Exh.64 is Desk Officer of State Bank of Indore, namely, Anveshbhai Navnitbhai Chhaya. He has been examined to prove documents at Exhs.65 and 66. It is his say that accused no.1 was working as Dy.Manager in FCNR desk and his duty was to issue TDR (Term Deposit Receipt) against foreign currency or Indian currency. Whereas, at Page 11 of 37 R/CR.A/1999/2012 CAV JUDGMENT the relevant time between 1993 - 1995, he was Asst.Manager in the same branch. He produced copy of relevant page of TDR index register of the branch at Exh.65 and states that xerox copy of page 689 shows that on 16.8.1993, there are two entries in the name of Jagdish R.Amin and Ajay Amin, which is numbered as 213656 and 213657, but, ultimately, it is cancelled by scrolling the text and by endorsing cancelled against both of them. It is his say that his handwriting is of accused no.1. He has identified the signature of accused no.1 as he was serving with him. Similarly, he identifies another four entires on page 38 of the register, which are numbered as 213672 to 213675 and in the name of Bipin B.Patel, Arvind B.Patel, Sanjay J. Amin and Purshottam G.Patel respectively and having similar cancellation mark of accused no.1 These entries are corroborating with the disclosure of such FCNR in Exh.68 and, therefore, both the accused are being tried and convicted as aforesaid with allegation that accused no.1 has helped the accused no2 to make a show that such FCNRs are in existence, but when State Bank of Indore has inquired from State Bank of India about such FCNRs, accused no.1 has cancelled such details from bank's register and accused no.2 has conveyed the State Bank of Indore that he does not want to obtain the loan. However, when this witness has been cross-examined, contradictory statement has come on record inasmuch as the witness admits that the register also bears handwriting of other bank clerks, which he does not recognise. He also admits that the document, which is proved through him at Exhs.64 and 65 does not come in his hand during his regular course of business in the bank. He also admits that such documents are never maintained under his observation, supervision and control and, thereby, he does not know that how such entries are made or cancelled. He further admits that bank's record is being regularly inspected and audited by vigilance department of the bank and such documents are Page 12 of 37 R/CR.A/1999/2012 CAV JUDGMENT passed through such regular inspection. He also admits that when such entries have come in existence, there would be corroborating documents and entries in the bank record and when his statement was recorded, no such other documents were verified. Even he has not clarified such fact to the C.B.I. He also admits that the officer, who is incharge of particular activity would only endorse any such register and instrument. He also specifically admits that it is true that any such TDR or FCNR may be cancelled at any point of time without assigning any reason and thereby it could not be known that how, why and who has cancelled such FDR or FCNR and that he has not conveyed such fact to the C.B.I when his statement was recorded. Surprisingly, he was not the incharge of the documents at the time of investigation and that he has no personal information at all about the documents and transactions. Whereas negativating his examination-in-chief and allegations against both the accused, witness has categorically admitted at last that absence of particular entry in register may be because of there is an error in instrument or the amount for such instrument could not be realised in time. He also admits that if instrument has not reached to the person, who has to record it in time, then, it cannot be recorded in the register. He also admits that if there is any objection in the connected document or if there is any lacuna in any of the document, then also, the entry could not be made in time in any of the register. He also admits that when there is no entry about remittance of any amount, it is clear that there was no payment against such entries, which are cancelled by accused no.1.
15. Therefore, evidence of PW-1 does not confirm commission of any illegal activity or any offence as alleged against both the accused except disclosing the procedure of the bank. So far as Exhs.65 and 66 are concerned, even those pages are exhibited and admitted on record, the Page 13 of 37 R/CR.A/1999/2012 CAV JUDGMENT deposition of this witness does not confirm that only because of such document, it can be said that accused no.1 has issued any forged document or committed any forgery in any manner whatsoever, even if entries referred by the witness is made by accused no.1, though even on that count, deposition of witness is not trustworthy, as per his admissions recorded herein above, which confirms that he does not have any personal knowledge and that such document never came across his duty in the bank. Therefore, deposition of this witness is of no use to confirm the conviction as already discussed herein above. Deposition of PW-2 at Exh.67 - Vijayan Krishnan Nair has already been discussed herein above confirming that either he or PW-8 are telling lie and thereby, practically, both of them are non-reliable.
16. PW-3 at Exh.75 - Mr.Prakash Hemraj Chhajed is the then Dy.General Manager of State Bank of Indore. At the relevant time, he was Branch Manager of Tilak Road Branch in Ahmedabad. He narrated the story about business transaction between the firms of accused no.2 and his bank. It is his say that borrower i.e. accused no.2 was having the gist of deposit receipts, which were supposed to be pledged to the bank. Therefore, this witness nowhere confirms that he has received the FCNR receipt which can be termed as forged receipt from accused no.2 and to presume that it was issued by accused no.1 so as to enable the accused no.2 to get huge loan from the State Bank of Indore. The witness has confirmed that they have visited the State Bank of India, which has confirmed that it can consider the loan against such FCNR receipts and conveyed that, they will communicate to the witness. However, it is the say of the witness that there was no communication from the State Bank of India. Thereupon, though State Bank of India has never responded to the witness or his bank that; if at all the FCNRs are forged; how and why Page 14 of 37 R/CR.A/1999/2012 CAV JUDGMENT respondent no.2 has disclosed such fact to the State Bank of Indore. On the contrary, when the witness, who is officer of State Bank of Indore states that when he approached the borrower i.e. accused no.2,it was told to him by accused no.2 that depositors/beneficiaries of such FCNR deposits are not interested in pledging those receipts and, hence, accused no.2 does not wish to avail the sanction loan. Thereby, a moot question arises that when there is a disclosure that deposit holders does not want to pledge the deposits in favour of accused no.2 and, therefore, when accused no.2 do not want to avail the sanctioned loan, what offence has been committed and by whom.
17. The only allegation against both the accused rests only to the effect that accused no.2 has disclosed the list of proposed FCNR holders, as per Exh.68 and name and details of FCNRs in Exh.68 tallies with entries cancelled by the accused no.1 in some of the bank record and, therefore, there was an attempt to obtain a huge loan and for the purpose, there was a conspiracy between accused nos.1 and 2. Thereby again the question would arise that which valuable security has been forged by accused no.2, if at all there is any forgery. Unfortunately, when it has not been investigated and not come on record except bare words of I.O about non- availability of deposit holders, prosecution has failed to prove that such entries were made with an intention to prepare forged FCNR receipts against which loan was to be availed. It is to be recollected here that except the entries in register of the bank, there is no other document recovered by the investigating officer. Thereby, it is clear that if at all FCNRs are forged, they are also not recovered and proved and produced on record. The witness has proved several other documents on record from Exhs.76 to 94, some of which are communication between different offices of both the bank and proposal by accused no.2, but thereby it Page 15 of 37 R/CR.A/1999/2012 CAV JUDGMENT could not be proved that accused nos.1 and 2 have forged the FCNR under reference, more particularly when those FCNRs does not come on record. The documents produced by the accused no.2 to the bank with his proposal are also included in documents proved by the witness on record, but it also does not confirm the commission of offence except the presumption that accused no.2 was in need of financial support,but that does not mean that even in absence of forged document,it is to be believed and that too for convicting a person for 10 years that he has committed forgery and cheating. None of the documents proved by this witness proves the commission of offence in any manner whatsoever. It is settled legal position that commission of offence cannot be presumed, but there must be cogent and reliable evidence to confirm that some offence has been committed and for convicting a person, there must be a specific reliable, cogent and undisputed evidence to confirm that particular act has been committed by particular person. Otherwise, the benefit of doubt would certainly go in favour of the accused. In the present case, when there is no disbursement of loan because of denial of availing loan by the accused no.2 himself, thereby, if at all there is conspiracy or existence of forged document, when benefit of such document was not availed by accused, it cannot be said that they are required to be punished for all such offences and that too by imposing the maximum punishment of 10 years. So far as attempt to commit an offence is concerned, that issue would be taken care of after discussing the entire evidence.
18. However, this witness has also no option, but to admit in terms of PW-1 regarding instruction and investigation of bank's record by their vigilance cell and confirming that their vigilance cell has not investigated anything in this case. It is also to be noted that if at all there would be any concluding offence of forgery and cheating, then, it would be with State Page 16 of 37 R/CR.A/1999/2012 CAV JUDGMENT Bank of Indore, whom present witness represents, but he confirms that they have not filed a complaint and he also admits that he does not know anything about transactions, which are under reference. He also admits that he has not seen the report of one Mr.K.C.Joshi. Surprisingly, such report has not come on record. He also admits that no correspondence had taken place between State Bank of Indore and State Bank of India with reference to proposal of accused no.2. He has also admitted that in this case, State Bank of Indore has not lost anything, since bank has not disbursed the loan amount and that while recording his statement, C.B.I has not called Mr.Joshi before him, who was probably more aware about the entire transaction. Therefore, deposition of this witness is also of no use except proving documents from Exhs.76 to 94 and more particularly, it does not confirm any cogent evidence to confirm that accused nos.1 and 2 have committed offence as alleged in the chargesheet.
19. PW-4 Harshvardhan Rameshchandra Dave at Exh.95 is the then A.G.M of State Bank of Indore. He has simply proved Exh.96, a list by which he has produced two documents before the investigating officer. Details of such documents is mentioned in Exh.96, which is only a receipt regarding handing over such document by the witness and taken over by Jitendra Singh P.I of C.B.I. Such letters are dated 13.9.1994 and 1.10.1993. However, only because such letters are submitted by the witness to the I.O, and only because the knowledge of the witness regarding application by the accused no.2 for the loan which was approved by the Executive Committee of the bank, it is not proving commission of offence by either of the accused or even conspiracy between them. On the contrary, this witness also admits that when he inquired about the progress of the loan, he was told that accused no.2 did not turn up to avail such loan facility. He identified the communication Page 17 of 37 R/CR.A/1999/2012 CAV JUDGMENT between accused no.2 and the bank and between two banks i.e. State Bank of Indore and State Bank of India. In cross-examination, he admits that their office has never filed a complaint and no documents were seized from regional office. He specifically admits that before C.B.I had inquired, there was no cause for inquiry at their end.
20. This witness has further admitted that he has not seen any documentary evidence except proposal by the accused no.2 during his service and, therefore, evidence and deposition of this witness does not confirm any cogent and reliable evidence against accused so as to confirm their conviction. The witness has also categorically admitted that he had never called any officer from Ahmedabad branch to inquire about the case and that whatever he has deposed before the Court is regarding procedural aspect of the sanctioning of the loan and nothing more. Therefore, this witness also does not help the prosecution to confirm conviction.
21. Therefore, one thing is clear that even if we believe that correction of certain entries in Exhs.65 and 66 are made by the accused no.1, it seems that it was during his course of service and his office did not find any offence or negative thing so as to inquire and to investigate or to file a complaint. Then, the question certainly arises would be that how and why C.B.I has come into picture and investigated in such a manner that only because of list on Exh.68, there is conspiracy between accused nos.1 and 2.
22. PW-5 Bhaskarrao Keshavlal Badheka at Exh.97 is the then Zonal Manager of State Bank of Indore. There is nothing more than the disclosure of similar facts as done by the previous witness, in the evidence by this witness also, since both of them are serving together as Page 18 of 37 R/CR.A/1999/2012 CAV JUDGMENT General Manager and Asst.General Manager respectively, except confirming that accused no.2 has applied for the loan, which was sanctioned, but, ultimately, accused no.2 has not availed the loan facility. Rest of the history regarding business transaction between the accused no.2 and the bank is not material at present, except to recollect that accused no.2 has not repay the previous loan of approximately Rs.2 Crores to the bank. However, it is an admitted position, but only because of previous debt, it cannot be presumed that accused no.2 has committed offence, more particularly when he was not able to submit the FCNR duly pledged in favour of the bank and, therefore, he has refused to avail the loan facility. In any case, it is not the case of any of the witness or the prosecuting agency that forged documents were produced before the State Bank of Indore for availing the loan. The only disclosure in evidence is to the effect that details of some FCNR was given, but thereafter, the accused no.2 has denied to avail the loan. Therefore, in absence of forged documents, it cannot be said that forgery or cheating has been resulted only because of disclosure of certain details, which for any reason, could not be materialised. In cross-examination, this witness has to admit that he was not the loan sanctioning officer, but as a General Manager of the bank, he confirms that there was no illegality or irregularity in sanctioning the loan in favour of accused no.2. In that case, it is difficult to believe that any offence committed either by accused nos.1 or 2, when ultimately loan was never availed. The witness further confirms that sanctioning of loan was as per rules and regulations of the bank and that he has no occasion to meet accused no.2 or to visit Ahmedabad branch or to verify the account holder. Witness has also admitted that the bank has not incurred any financial loss in this case.
23. PW-6 at Exh.98 Prabhudas Chunilal Rajpara, was Manager of State Page 19 of 37 R/CR.A/1999/2012 CAV JUDGMENT Bank of India at relevant time and was serving with accused no.1. He explained the procedure to be followed for issuing FCNR and discloses the list of register, where relevant entries of such FCNRs are to be made. The most important admission by this witness during his cross- examination is to the effect that blank FCNR form remains in joint custody of Dy.Manager and Accountant, because it is a security of the bank and, therefore, and though this witness identifies all the entries in Exhs.62 to 65, though he proves the register at Exhs.99 and 100, evidence of this witness does not confirm that it was only accused no.1, who has created any forged FCNR as per list at Exh.68, though this witness identifies the endorsement of cancellation by accused no.1. When this witness categorically admits that blank FCNR receipts remains in joint custody of Dy.Manager and the Accountant, the crucial issue is how and why Accountant has not been either chargesheeted or even exmained as a witness in this case, if at all blank FCNR receipts are being misused and forged so as to make a show that persons whose names are disclosed in so called forged FCNRs have invested such foreign currency before the State Bank of India and against which State Bank of Indore is going to disburse loan of more than Rs.4 Crores. Therefore, only because some entries are made by accused no.1 in certain register, it does not prove that accused no.1 has also forged some such FCNRs in favour of some unknown persons, so as to help the accused no.2. During cross- examination, witness has to admit that though he was Manager at the relevant time, his activity and duties and activity and duties of NRI Accountant are different, though they are in the same department. He has also admitted that any account holder can cancel his FCNR or FDR at any point of time without any time limit and that such FDRs are generally prepared by the clerk and officer would endorse after verification. He further admits that none of the documents, which are produced on record Page 20 of 37 R/CR.A/1999/2012 CAV JUDGMENT bears his signature or endorsement and, therefore, practically, this witness has no personal knowledge at all. He further admits that none of the documents were shown to him at the time of recording his statement and when none of the documents are placed before him during his duty for his verification, his deposition is irrelevant even though he deposed everything against accused no.1. The most important admission by the witness is last last two line, which is relevant. He admits that FDRs were prepared as per rules and regulations of the bank and that he does not have any personal knowledge regarding such FDRs. It is surprising to note that deposition of such witness has been treated for confirming guilt of both the accused, though there is no iota of evidence against any one of them regarding commission of offence as alleged.
24. PW-7 Jayantibhai Hemchandbhai Doshi at Exh.102 is the then Asst. Manager of Security Department in State Bank of India at Ahmedabad where accused no.1 was Dy.Manager. He also identifies the handwriting of accused no.1 at Exhs.65 and 66 and states that there are no corresponding cross entries in registers, which are produced at Exhs.99 and 100. He explained the procedure of registration of FDRs in different document and confirmed that from the available record, it can be said that these FDRs under reference were prepared and then cancelled and its number was pasted in relevant register as per practice, but there is no cross entry of remittance for any such FDR. In his cross-examination, he admits that he served in the NRI division only for eight months and his superior officer was Rajpara. Mr.Rajpara was one of the witness being PW-6 and his evidence has been discussed herein above, which does not confirm the commission of offence as alleged. Though he was serving with accused no.1, then how and why this witness, who is otherwise not serving with the accused at the relevant time is able to explain everything Page 21 of 37 R/CR.A/1999/2012 CAV JUDGMENT so as to confirm that accused no.1 has committed some offence, when he has categorically admitted in his cross-examination that he does not have any direct transaction with accused no.1 and he could not do so though he denies that even for such reasons, he could not identify the signature of accused no.1. Surprisingly, witness has however admitted that accused was serving in Accounts department, whereas witness was serving in Security department. He has also to admit that customer can cancel the FDR at any time and at that time, due amount is being paid to the customer by cancelling the FDR and number of such cancelled FDR is generally pasted in the register. Surprisingly though this witness is not serving in the department of accused no.1, prosecution has asked him to explain the entire activity and witness has narrated the same. However, witness has to admit that none of the register bears his signature or endorsement and that he has no direct transaction with any of such registers. He also admits that maintenance of the register is the duty of the bank clerk.
25. Evidence of PW-8 at Exh.104 - Kamleshbhai Babubhai Gajjar has already been discussed herein above confirming that either he or PW-2 are telling lie and thereby, practically, both of them are non-reliable.
26. PW-9 at Exh.106 is one Mr.Shailesh Madhavan Nair, who was serving in Central Excise Office at Ahmedabad. It is his say that C.B.I has seized one English typewriter of Godrej company and one file from one office on first floor of Narayan Chambers. However, except saying that it is the office of the builder. He does not disclose the name of any of the accused or their firm, though he says that receipt of such search was given to accused no.2. Thereby, he proves the document at Exh.107 being search and seizure list, which was signed by him as well as other pancha, Page 22 of 37 R/CR.A/1999/2012 CAV JUDGMENT namely, Nazima Sheikh. Whereas as PWs-2 & 8, so-called typists have stated that typewriter was not seized. However, there is nothing material in the deposition of this witness, which can confirm that any of the accused has committed any offence as alleged against them.
27. PW-10 - Bhagwatilal Ganapatsinh Pandya at Exh.110 was the then Chief General Manager, Financial Control, Corporate Centre of State Bank of India at Mumbai. It is his case that they have received certain complaint from NRI customers of his bank to the effect that whenever such customers have inquired from the bank about status of their FDR, they were informed that their deposit is no more lying in the bank and, therefore, such complaints were investigated at their branch level, wherein he assigned the job of investigation to one of the senior manager of NRI division, who was conversant with NRI transactions. However, none of such complaint or the senior manager, who has investigated the irregularity, if any, has been examined to prove that in fact there is complaint either against the bank or against the accused no.1, though, witness said that during such investigation, it was found that accused no.1 had misused the blank FDRs and 2.3 Million dollars were diverted fraudulently by playing with the records and some FDRs were received without receiving any amount. It is further alleged that the witness has learnt that the accused no.2 has applied to State Bank of Indore for certain facilities based upon fixed deposits of their bank and during the cross transaction, he could not produce any such FDR since such FDR was never issued by bank in favour of accused no.2, but numbers printed in the FDRs were misused and record of the bank was tampered to create an impression that accused no.2 had some FDRs in State Bank of India, which as a matter of fact never existed.
Page 23 of 37 R/CR.A/1999/2012 CAV JUDGMENT28. It is further stated by the witness that having learnt the tampering with the record and fabrication of FDRs, a detailed investigation was carried out by the witness himself so as to know that how many such fabricated transactions have been created and having learnt that some scam has been committed, it was decided to handover the case to C.B.I. It is further stated that in exercise of his administrative powers, he then suspended accused no.1 after going through all records, registers, materials, relating to such transactions. Surprisingly, after saying so many things when he was asked about the the investigation, it is his excuse that since 16 years have lapsed, he do not recollect further. But, he has issued a sanction to prosecute accused no.1 and proved the same at Exh.111 on record. Therefore, the first reading of the deposition of such witness, makes it clear that he simply wants to say his limited story, and though he has not investigated the issue on his own and if at all some investigation was done, then, neither its result was disclosed on record nor the person who has investigated the issue has been examined. Non-examination of such material witness would certainly result into adverse inference against the prosecution by extending the benefit of doubt to the accused. However, during his cross-examination, this witness could not sustain the allegations levelled by him when he admits that though he was empowered to call upon the witnesses and though he admits that bank has received the complaint, he changed his version by saying that "I mean that there may be complaint in writing or even an oral complaint based upon the inquiry made by the respective NRI". So, now, witness tries to escape from his responsibility and liability to produce such complaints of customer, if at all they are in existence and turned around by saying that now by lapse of time, he could not say that whether he has received any such written complaint or not. He also denied to know the procedure to be adopted and formalities to be observed while dealing with such Page 24 of 37 R/CR.A/1999/2012 CAV JUDGMENT complaints of NRI. Witness has also admitted that he has never visited State Bank of Indore and never called any officer from that bank and thereby he had never inquired with the State Bank of Indore. Surprisingly, though all other witnesses are categorically confirming that there was no monetary loss caused to the bank, this witness has the audacity to say that such issues needs to be checked from the record. However, he admits that no such scam has ever been flashed or revealed during any regular audit of the bank. The witness also admits that he is not sure that whether he had any occasion to see the duty list of accused no.1 and it is a matter to be ascertained from the record. In general, this witness has tried to be smart enough to deny all the questions in cross- examination, as if he does not know anything. If it is so, his examination- in-chief could not be relied upon when he does not remember the factual details of this transaction and, therefore, only because of the deposition of such witness, it cannot be considered that accused has committed alleged offence.
29. PW-11 at Exh.132 is Narendrasingh Rajendrasingh Sikh, who was working with FSL at Hyderabad at relevant time of examining the documents at Exh.68. However, when muddamal typewriter was not sent to him for examination, I fail to understand that what would be the evidentiary value of his report, which is proved by him at Exh.133. Though he confirms that specimen typing forwarded to him tallies with the typing of Exh.68. Specimen typing were probably collected while seizing the typewriter in presence of panchas, but in absence of evidence to that effect, such piece of evidence cannot be considered as evidence for confirming conviction of the accused when it is not corroborated with other cogent and reliable evidence. It is known position that typing by similar typewriter would be almost same and, therefore, only because of Page 25 of 37 R/CR.A/1999/2012 CAV JUDGMENT Exh.68 and specimen of typing forwarded to the witnesses are similar, it cannot be said that it was typed on the typewriter, which was seized from the office of accused no.2. However, in any case, the typing of such list in the office of accused no.2 itself is not sufficient evidence to confirm the conviction.
30. PW-12 Jitendrasingh Vishwanathsingh is the then Superintendent of Customs Department, who was working as P.I in C.B.I and who has investigated the offence. Being investigating officer, he deposed at Exh.135 perfectly in terms of his investigation and proved certain documents at Exhs.136 to 141 on record, which are nothing but, FIR registered by him and other relevant documents and copies of the register which are already exhibited during evidence of other witnesses. The chief and cross-examination of I.O is not material, inasmuch as being a Customs Superintendent and investigating officer of C.B.I, he has narrated his story in nutshell. However, he has to admit that the case was based on FCNRs, but unfortunately, such FCNRs are never recovered. He also admits that neither State Bank of India nor State Bank of Indore has made any complaint in the case, but the investigation and chargesheet of this case was initiated from the investigation of one another case being R.C.no.22 of 1994. He also admits that bank has their vigilance department and no statement of any vigilance officer of either of the bank was recorded. He also admits that though loan of Rs.4 Crores has been sanctioned in favour of accused no.2, the same was not disbursed because he did not come forward to avail the facility and that he did not produce the original FCNRs and thereby there was no financial loss caused to either of the bank. He denied the suggestion that all the six depositors in whose name the FCNRs were prepared, had deposited the same in the morning and have encashed the same in the evening. It is his say that he Page 26 of 37 R/CR.A/1999/2012 CAV JUDGMENT has not recorded the statement of any such depositor as they were not found in existence. He has to admit several irregularities in investigation, which would certainly go in favour of the accused, so as to extend benefit of doubt in their favour.
31. Thus, none of the witnesses have disclosed any specific details and information so as to prove that accused nos.1 and 2 have committed any offence as alleged.
32. Thereby, if we verify the FIR, which is registered as R.C.42(A)/94/A/ABD on 12.10.1994, it becomes clear that it has been registered by P.P.Pandey, Superintendent of Police, C.B.I, based upon an information received from his office that accused no.1 has entered into criminal conspiracy with accused no.2 with an intention to cheat State Bank of Indore by issuing six TDRs worth Rs.22.94 Lacs in fake name without any remittance of money and on strength of these FDRs, accused no.2 submitted loan application to the State Bank of Indore, Relief Road branch, Ahmedabad, whereupon loan proposal was proceeded by the State Bank of Indore and loan of Rs.4.38 Crores was sanctioned against said TDRs. But on verification of FDRs, when both the accused apprehended that they would be caught, they decided not to avail the loan and thereby both of them have committed offence as alleged in the FIR and chargesheet. Thereby, surprisingly though the FDRs are in US $, the complaint disclosed it in Indian rupees and, therefore, prima facie it is clear that even complainant has not bothered to clarify the facts and details properly. Another glaring contradiction is with reference to date of FDRs and loan application. It is admitted position that FDRs were cancelled on 16.8.1993 whereas loan application is submitted on 21.8.1993 and, therefore, it is clear and obvious that on the date of Page 27 of 37 R/CR.A/1999/2012 CAV JUDGMENT application, such FDRs were not in existence and, therefore, there is no scope or reason to create false FDRs. It is also clear and obvious, as discussed herein above, that in fact by letter dated 21.8.1993, which is Exh.84, the accused no.2 has categorically conveyed to the bank that they will receive the original FDR from its holder directly through courier and, therefore, there is neighter a case nor an evidence to show that there is any meeting of minds between the accused nos.1 and 2 so as to result into criminal conspiracy for forging any document or cheating the bank as alleged.
33. In any case, when loan amount was not availed by accused no.2 and when there is no financial loss to any of the bank, even if there is commission of any offence, then, it would be limited to attempt for committing any such offence, which is punishable u/s.511 of the IPC, but there is no evidence at all which proves beyond reasonable doubt that accused nos.1 and 2 have entered into criminal conspiracy to forge the document and thereby to cheat the State Bank of India. It is obvious that the clerk, who is making the entries has not been examined, and flow of money between the bank record is not produced.
34. It is submitted by the learned senior counsel for both the accused that though some of the amount of the FDRs tallies with the amount disclosed in the list at Exh.68, in fact on verification of entire record, it becomes clear that several amount does not tally and, therefore, it cannot be said that FDRs in question are meant for illegal benefit of accused no.2. It is also submitted that there is no evidence regarding contradiction of any record, so also there is no record of any pecuniary advantage by any of the accused. It is further submitted that at the most it can be said that this is nothing more than preparation even if criminal conspiracy was Page 28 of 37 R/CR.A/1999/2012 CAV JUDGMENT designed between the accused. However, at the same time, it is also submitted that in absence of cogent evidence regarding criminal conspiracy and in absence of recovery of forged documents, and more particularly, when accused no.2 has not availed loan facility against the forged documents, it cannot be said that any of the accused have committed any offence for which they can be convicted by highest sentence of 10 years.
35. Learned advocate Mr.R.C.Kodekar for the C.B.I has no option but to support the impugned judgment by narrating the history and story of case and referring certain evidence, which confirms the handwriting of accused no.1. However, only because accused no.1 has made some endorsement in some register, it cannot be said that it is proved beyond reasonable doubt to confirm that it was only accused no.1, who has forged the documents as alleged for the reasons and discussion of the evidence, as above.
36. Then remains the finding by the Special Judge while convicting the accused and sentencing them with highest punishment by impugned judgment. If we peruse the impugned judgment, the trial Court has discussed the evidence and submission of both the sides in detail. However, the trial Court could not point out that how and when document has been forged, when no forged document has come forward and thereby trial Court also could not explain that how forged document has been used for getting monetary benefit. It is admitted by the trial Court also that there was no monetary benefit to any of the accused. Though so- called forged FDRs are not recovered and proved on record, and though there is no investigation regarding its holder, surprisingly, the Special Judge has stated in paragraph 25 of impugned judgment that such FDRs Page 29 of 37 R/CR.A/1999/2012 CAV JUDGMENT were in handwriting of accused nos.1 and same were in fake names. Similarly, though Special Judge has recorded that two witnesses i.e. PW- 2 and PW-8 both are claiming that list at Exh.68 was typed by them on blank paper as per the instruction of accused no.2, the Special Judge has compared the evidence of both the witnesses and when one of the witness says that he does not remember as to when he has typed Exh.68 and when another witness says that it was typed under the instructions of accused no.2, the Court believes that much reliance can be placed on the evidence of PW-2, who has stated that it was typed under the instructions of accused no.2 and handed over to Shri Chhajed of State Bank of Indore. Discussion in paragraph 32 of the impugned judgment in this reference is not digestable and based on such evidence, there cannot be a conviction and sentence of 10 years in absence of cogent and reliable other evidence.
37. The learned senior counsel for accused had also relied upon the definition of 'collateral security' and 'valuable security', submitted that list at Exh.68 could not be said as 'valuable security' and, therefore, it is mere a information and cannot be treated as valuable security, which can be treated as forged for getting undue advantage and, therefore, it is submitted that in absence of forged valuable securities, which are alleged to be offered for loan, when loan amount is not availed, there is no concluded offence as alleged.
38. Whereas, Special Judge has placed reliance only upon entries cancelled by accused no.1 to confirm the commission of offence by both of them though there is no positive evidence regarding conspiracy and though cancellation is prior to the application for loan. Thereby, as submitted by the accused, there is possibility that though FDR holders have disclosed their details to accused no.2, ultimately, they got it Page 30 of 37 R/CR.A/1999/2012 CAV JUDGMENT cancelled from State Bank of India probably without intimating accused no.2 and, thereby, it cannot be said that offences as alleged are committed by both the accused.
39. In paragraph 57, the Special Judge has against observed something, which is not in confirmation of settled legal position, when it is stated that the initial burden is on the accused to establish by preponderance of all probabilities that they were falsely implicated. Suffice it to say that it is initially the burden of the prosecution to prove beyond reasonable doubt that alleged offences are committed by the accused only, who are charged under the case, and by none other than them. Thereupon, if at all accused are able to show that probably they are falsely implicated, then, there must be a cogent, reliable and confirming evidence regarding commission of offence by the accused, which may not create any doubt in any manner. Thereby, if there is a doubt regarding commission of offence by the accused, then, benefit of doubt is certainly required to be extended to the accused.
40. Surprisingly, in paragraph 58, again the Special Judge has observed that it was for the accused to prove the original FCNRs and any cancellation of entries in the bank register without corresponding entries, proves that accused no.1 has forged all the accounts. This is nothing, but presumption of commission of some offence. It is settled legal position that there cannot be a presumption of commission of some offence. It is settled legal position that there cannot be a presumption of commission of offence for convicting the accused, but there must be a cogent and reliable evidence confirming that accused has committed particular offence.
41. In view of above discussion, it becomes clear that the evidence on Page 31 of 37 R/CR.A/1999/2012 CAV JUDGMENT record does not confirm beyond reasonable doubt that accused has committed the offences for which they are charged and convicted.
42. It would be appropriate to refer some latest decision as under:-
(1) In Sherimon Vs. State of Kerala reported in AIR 2012 SC 493 while considering the criminal conspiracy with reference to Section 120B of the IPC, Hon'ble the Supreme Court has reconfirmed that for offence of conspiracy, there must be meeting of minds resulting in decision taken by conspirators regarding commission of crime.
When no such evidence has come on record, and when such evidence on record is totally inadequate to come to the conclusion that police had hatched criminal conspiracy, conviction of the appellant with aid of Section 120B is liable to be set-aside.
(2) Whereas, consideration of fraud has been referred in following manner in the case of State of A.P. and Anr. Vs. T.Suryachandra Rao reported in (2005)6 SCC 149 and the same has been reproduced and relied upon in Behari Kunj Sahkari Avas Samiti Vs.State of U.P. & Ors.reported in 2008(10) SCALE 551 as well as in Rani Aloka Dudhoria Vs. Goutam Dudhoria reported in AIR 2010 SC 53.
"By "fraud" is meant an intention to deceive; whether it is from any expectation of advantage to the party himself or from the ill will towards the other is immaterial. The expression "fraud" involves two elements, deceit and injury to the person deceived. Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include and any harm whatever caused to any person in body, mind, reputation or such others. In short, it is a non-economic or non-pecuniary loss. A benefit or advantage to the deceiver, will almost always call loss or detriment to the deceived. Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied."
(3) Whereas in A.C.Ananthaswamy Vs. Boraiah reported in (2004)8 SCC 588, Supreme Court has categorically laid down that Page 32 of 37 R/CR.A/1999/2012 CAV JUDGMENT "in establishing alleged fraud, it must be proved that the representation made was false to the knowledge of the party making such representation or that the party could have no reasonable belief that it was true. Level of proof required in such case was held to be extremely high."
(4) Whereas in Abhayanand Mishra Vs. State of Bihar reported in AIR 1961 SC 1698, Hon'ble Supreme Court has considered the attempt to commit an offence in following manner. "The question whether a certain act amounts to an attempt to commit a particular offence is a question of fact dependent on the nature of the offence and the steps necessary to take in order to commit it. No exhaustive precise definition of what would amount to an attempt to commit an offence is possible. There is a thin line between the preparation for and an attempt to commit an offence. Undoubtedly, a culprit first intends to commit the offence, then makes preparation for committing it and thereafter attempts to commit the offence. If the attempt succeeds, he has committed the offence; if it fails due to reasons beyond his control, he is said to have attempted to commit the offence. Attempt to commit an offence, therefore, can be said to begin when the preparations are complete and the culpit commences to do something with the intention of committing the offence and which is a step towards the commission of the offence. The moment he commences to do an act with the necessary intention, he commences his attempt to commit the offence. A person commits the offence of attempting to commit a particular offence, when (i) he intends to commit that particular offence and (ii) he, having made preparations and with the intention to commit that offence, does an act towards its commission; such an act need not be the penultimate act towards the commission of that offence but must be an act during the course of committing such offence."
(5) In AIR 1999 SC 1801 Punjab Communications Ltd. Vs. Union of India, Hon'ble the Supreme Court has held that there cannot be any cause of action on the basis of an attempt at fraud which did not materialise.
(6) In AIR 2003 SC 2748 Ram Narayan Popli Vs. CBI the Hon'ble Supreme Court has held as under:-
"In order to constitute forgery, the first essential is that the accused should have made a false document. The false document must be made with an intent to cause damage or Page 33 of 37 R/CR.A/1999/2012 CAV JUDGMENT injury to the public or to any class of public or to any community. The expression 'intent to defraud' implies conduct coupled with intention to deceive or thereby to cause injury. In other words, defraud involves two conceptions namely, the deceit and injury to the person deceived, that is infringement of some legal right possessed by him but not necessarily deprivation of property. The definition of the offence of forgery declares the offence to be completed when a false document or false part of a document is made with specified intention. The questions are (i) is the document false (ii) is it made by the accused and (iii) is it made with an intent to defraud. If at all the questions are answered in the affirmative, the accused is guilty. In order to constitute an offence of forgery the documents must be made dishonestly or fraudulently. But dishonest or fraudulent are not tautological. Fraudulent does not imply the deprivation of property or an element of injury. In order to be fraudulent, there must be some advantage on the one side with a corresponding loss on the other."
43. A doubt or surmise is not proof of fact. The claim that FCNRs were forged, is not proved unless such FCNRs are brought and proved on record or unless all their relevant documents regarding money transactions are also brought on record and proved. A suspicion that there might have been conspiracy and fraud, is not proof of conspiracy and fraud. At all events who should establish fraud and conspiracy? Is it for the prosecution which alleged fraud and conspiracy by accused and established those facts? Or is it for the accused to establish that there was no fraud or conspiracy in respect of the application of loan? The onus is certainly and clearly on the prosecution, more particularly when there is no monetary benefit to the accused since accused no.2 has categorically denied to avail the loan.
44. Though not much relevant in the present case, reference to the case of Manoj Sharma Vs. State reported in AIR 2008 SC Suppl.1171 with other Page 34 of 37 R/CR.A/1999/2012 CAV JUDGMENT judgments relied upon in such judgment may be recollected here because even after monetary benefit, when accused have repaid the amount which was otherwise subject matter of the scam and when bank compromised the dispute by accepting even the lesser amount than the total amount, Hon'ble the Supreme Court has held that in such cases, it would be improper to continue with the prosecution. Whereas in the present case, there is no doubt that there was no monetary benefit to anyone when loan amount was not disbursed at all.
45. However, the only issue remains is regarding conviction u/s.511 of the IPC, which deals with punishment for attempting to commit offence. However, reference of offence in Section 511 of the IPC is for offences, which are punishable with life or other imprisonment. But, if we check the illustration, it becomes clear that conviction u/s.511 of the IPC is mainly for moral guilt rather than injury.
46. Section 511 is a general provision dealing with attempts to commit offences not made punishable by other specific sections. It makes punishable all attempts to commit offences punishable with imprisonment and not only those punishable with death. An attempt is made punishable, because every attempt, although it falls short of success, must create alarm, which by itself is an injury, and the moral guilt of the offender is the same as if he had succeeded. Moral guilt must be united to injury in order to justify punishment. As the injury is not as great as if the act had been committed, only half the punishment is awarded. Attempt to commit an offence can be said to begin when the preparations are complete and the culprit commences to do something with the intention of committing the offence and which is a step towards the commission of the offence. The moment culprit commences to do an act with the necessary intention, Page 35 of 37 R/CR.A/1999/2012 CAV JUDGMENT he commences his attempt to commit the offence. The word "attempt" is not itself defined, and must, therefore, be taken in its ordinary meaning."
47. It is obvious that there may be concluded act of offence or there may be attempt, but when there is a conviction for attempt, it is certain and clear that there is no concluded offence. Thereby, in any case, impugned judgment is required to be set-aside when it is convicting the appellants, both for concluded offence and for attempt to commit the same offence.
48. Therefore, in the present case, if we consider the activity of both the accused as admitted to commit offence of forgery, then, their conviction remains only u/s.511 of the IPC, but not in all other sections for which they are convicted. However, though one half of conviction is provided u/s.511 of the IPC, considering the facts and circumstances of the case, it would be appropriate to reduce the conviction for the period already undergone by both the accused till this judgment.
49. Therefore, the appeals are partly allowed. Thereby the impugned judgment is modified by acquitting the accused from all the charges levelled against them except for the offence punishable u/s.511 of the IPC and reducing the sentence u/s.511 of the IPC for the period already undergone by them till date. The amount of fine, if any, in deposit, shall be refunded. Thereby, they are set at liberty forthwith,if not required in any other case.
50. In view of the order passed in Criminal Appeal No.2000 of 2012, Criminal Misc.Application No.19827 of 2013 in Criminal Appeal No.2000 of 2012 does not survive and stands disposed of.
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