Delhi District Court
Central Bureau Of Investigation (Cbi) vs Rajat Gupta on 17 December, 2016
IN THE COURT OF SH. JITENDRA KUMAR MISHRA
SPECIAL JUDGE (PC ACT) CBI,
KARKARDOOMA COURTS : EAST DISTRICT
DELHI
New CBI Case No. 52/2016
CNR No. DLKA01-000049-2003
RC No. 2(E)/02
PS/Branch: CBI/BS & FC/ND
IN THE MATTER OF :-
Central Bureau of Investigation (CBI),
VERSUS
1. Rajat Gupta
S/o Sh. Satish Chandra Gupta,
R/o 1301, Parasurampuria Tower no. 6,
Lokhandwala, Yamuna Nagar, Andheri
West, Mumbai,
Executive Director, M/s Aviquipo of India Ltd. ....A1
2. Sh. Gyan Chand Verma,
S/o Late Sh. Laxmi Chand,
R/o 228, Gopalpura, Mathura, UP.
Former GM, M/s Aviquipo of India
Ltd. ....A2
3. Sh. Vinod Kumar Thukral
S/o Late Sh. S. L. Thukral,
R/o E-355, Greater Kailash,
Part-I, New Delhi, Former AGM,
Dena Bank. ....A3
CBI v. Rajat Gupta & Ors. Page1 of 248
4. M/s Aviquipo of India Ltd.
Registered Office at
22, Chittaranjan Avenue,
Kolkata (through its Executive
Director Sh. Rajat Gupta)
(discharged vide order dated 02.08.2004) .... A4
Date of Institution 26.07.2003
Date when Judgment is reserved : 01.08.2016
Date of Judgment: : 09.12.2016
J U D G M E N T
1 Facts of the case of the prosecution in brief are that A1, A2 and A3 and A4 were sent for trial for commission of offences under Section 120B IPC read with Section 420, 468, 471 IPC and section 13(2) read with Section 13 (1) (d) of Prevention of Corruption Act. All the accused were also charged for substantive offences under Section 420, 467, 468, 471 IPC and under Section 13 (2) read with Section 13 (1) (d) of Prevention of Corruption Act. 2 It is case of the prosecution that A1 being the Executive Director of A4 during May 1999, entered into criminal conspiracy CBI v. Rajat Gupta & Ors. Page2 of 248 with others accused persons to cheat Dena Bank, Scope Complex, Lodhi Road, New Delhi in the matter related to sanction of various credit limits by Dena Bank to A4 dishonestly and fraudulently and in pursuance of the said conspiracy A1 forged documents as genuine and induced the competent authority of Dena Bank to sanction credit limit to A4. A4 was sanctioned a term loan of Rs.7 crores. It is further case of the prosecution that that forged letters were submitted dishonestly and fraudulently to obtain term loan from the bank by A1. It is alleged that A1 cheated Dena Bank to the extent of Rs.6,49,74,000/- in conspiracy with co-accused persons. A3 got sanctioned the loan and helped co-accused in disbursement of the loan in conspiracy with A1. A2 forged the documents for that purpose.
3 It is further case of the prosecution that A1 was the Executive Director of A4 when this company approached Dena Bank for the grant of term loan of Rs.7 crores and working capital of Rs.2 crores to set up a project for the manufacture of atomized gold. The CBI v. Rajat Gupta & Ors. Page3 of 248 company was sanctioned a term loan of Rs.7 crores for building and purchase of plant and machinery of M/s Handy & Harman Refining Group Inc., USA Cash Credit Limit of Rs.1 crore and letter of credit limit of Rs. 1 crores by General Manager (Operations Rest of India), Head Office, Mumbai. The HO sanction was conveyed to DGM, North India Operations, New Delhi by Sh. K. B. Poojary, Chief Manager (Operations Rest of India-I) vide letter No. HO/ORI/3049/98 dated 21.11.1998. A sanction letter No. DB/SC/ADV/AVIQUIPO/98 dated 01.12.1998 addressed to Managing Director M/s Aviquipo was prepared by Sh. Ramesh Kukreja, Manager (Credit) and signed by A3, Chief Manager, both of scope Complex Branch, Lodhi Road, New Delhi. The various items and conditions pointed out in this letter were accepted by Sanjay Gupta and Praveen Kumar, both directors of A4. 4 Chief Manager (Operations, Rest of India-I) sent letter dated 26.12.1998 to DGM, North India Operations, New Delhi to obtain NOC from Union Bank of India, UPFC and National Small CBI v. Rajat Gupta & Ors. Page4 of 248 Industries Corporation with whom the A4 was banking to confirm that they will have no charge over the assets or the manufacturing division to be located at NOIDA. This directions was passed on to A3 i.e. Chief Manager of the said Branch to ensure compliance of the same before disbursement of loan. A3 informed DGM, North India Zone vide letter dated 06.01.1999 that branch had informed about it to the constituents.
5 A3 also intimated the DGM North India Zone of the bank that basic documentation had taken place and the party had started giving other compliance certificate and had assured that all the papers would be submitted before the disbursement. A3 requested for permission for disbursement of the loan.
6 A1 informed the bank on 07.05.1999 "with regard to NSIC and UPFC, we are submitting the report in a day or two". Investigation further revealed that A1 in conspiracy with others submitted photostat copy of letter No. 263/FC/REC/NOIDA-99-2000 CBI v. Rajat Gupta & Ors. Page5 of 248 dated 11.05.1999 certified by him to be a true copy purported to have been issued by S. K. Pasari, Regional Manager, Uttar Pradesh Finance Corporation, NOIDA addressed of A4 declaring therein that the company's account with UPFC was regular as on that date, and UPFC had no objection to the company registering, a separate charge on the fixed assets of their new factory financed by Dena bank, Scope Complex Branch, New Delhi and that UPFC would not have any charge on the assets of the new factory which would be under the first charge of Dena Bank. A1 handed over the said letter to A3, Chief Manager, Scope Complex Branch, New Delhi on 12.05.1999 vide letter no. AVQ/NZ/99/018.
7 It is further case of the prosecution that A1 had also submitted copy of "No Dues certificate" issued by NSIC, Noida vide letter no. NSIC/RON/RMA/18/98-99 dated 07.05.1999 purportedly issued by Sh. S. K. Pasari, Regional Manager, Uttar Pradesh Financial Corporation, NOIDA addressed to M/s Aviquipo, regarding acceptance of company's 'one time settlement' of outstanding dues CBI v. Rajat Gupta & Ors. Page6 of 248 totaling Rs.45 lacs has been seized during the course of investigation from the file pertaining to the company loan account maintained with Dena Bank, Scope Complex Branch, Lodhi Road, New Delhi. This letter had also been submitted by the account company to the bank.
8 It is further case of the prosecution that during investigation it has revealed that the above stated two letters No. 236/FC/REC/NOIDA-99-2000 dated 05.05.1999 and No. 236/FC/REC/NOIDA-99-2000 dated 11.05.1999 of UPFC were neither issued by UPFC nor signed by S. K. Pasari, the then Regional Manager, UPFC NOIDA and thus the same were forged documents. The fact that the signatures of S. K. Pasari has been forged and fabricated on both the letters dated 05.05.1999 and 11.05.1999 has been confirmed by expert opinion. The UPFC has also denied to have issued any such letters.
9 It is further case of the prosecution that A1 also submitted copy of "No Dues Certificate" issued by NSIC, Noida vide CBI v. Rajat Gupta & Ors. Page7 of 248 letter No. NSIC/RON/RMA/18/98-99 dated 07.05.1999 purportedly issued by Sh. S. K. Pasari, Regional Manager, Uttar Pradesh Financial Corporation, NOIDA addressed to A4 regarding acceptance of company's 'one time settlement' of outstanding dues totalling Rs.45 lacs has been seized during the course of investigation from the file pertaining to the company loan account maintained with Dena Bank, Scope Complex Branch, Lodhi Road, New Delhi. This letter had also been submitted by the accused company to the bank.
10 Investigation has revealed that the above stated two letters No. 236/FC/REC/NOIDA-99-2000 dated 05.05.1999 and No. 236/FC/REC/NOIDA-99-2000 dated 11.05.1999 of UPFC were neither issued by UPFC nor signed by S. K. Pasari, the then Regional Manager, UPFC, NOIDA and thus the same were forged documents. The fact that the signature of S. K. Pasari has been forged on both the letters dated 05.05.1999 and 11.05.1999 has been confirmed by expert opinion. The UPFC has also denied to CBI v. Rajat Gupta & Ors. Page8 of 248 have issued any such letters.
11 It is further case of the prosecution that investigation further revealed that the total outstanding of the company with UPFC as on 11.05.1999 were Rs.82,65,505.68. The attempts of A1 for one time settlement with UPFC NOIDA was rejected. 12 A1 did not give clear picture of the dealing of the company with UPFC and the rejection of his proposal and instead wrote a letter dated 05.09.2000 to Dena Bank that only down payment of Rs. 5 lacs was to be made to the UPFC which had been deposited immediately. However, the said amount had also not been deposited with the UPFC. The contents of the letter dated 05.09.2000 were found to be false.
13 It is further case of the CBI that funds of term loan could not have been released to A4 without the compliance of the conditions stipulated by Head office of Dena Bank vide letter no.
CBI v. Rajat Gupta & Ors. Page9 of 248 HO/ORI/3288/98 dated 26.12.1998 for obtaining NOC and
confirmation from UPFC that it would not have any charge over the assets of the atomizer project of A4. The forged letters dated 05.05.1999 and 11.05.1999 were made use of dishonestly and fraudulently to obtained the funds of terms loan from the bank by A4 through A1. A3 ordered the release of first installment of Rs.2 crores on 13.05.1999 on the day when he was transferred to Calcutta on the basis of request letter of A1 dated 12.05.1999. A3 knowingly did not write letter to UPFC, NOIDA and NSIC, Noida to comply with the terms of Head Office letter No. HO/ORI/3288/98 dated 26.12.1998 for obtaining on objection from the said two financial institutions that they would not have any charge over the assets of the Atomizer project of A4 which was being financed by Dena Bank. 14 It is pertinent to mention that vide order dated 02.08.2004, proceedings against A4 have been dropped.
CBI v. Rajat Gupta & Ors. Page10 of 248 15 On completion of investigation, charge-sheet was filed before the Court. Copies of documents were supplied to the
accused persons in compliance with provisions of Section 207 Cr.PC.
Charge 16 On 03.11.2008 charge for offence under Section 120B IPC read with Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of Prevention of Corruption Act, 1988 framed against A1, A2 & A3 Further charge for offence under Section 420/468/471 IPC read with section 120B IPC framed against A1 & A2.
Further charge for offence under Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of Prevention of Corruption Act, 1988 read with 120B IPC framed against A3.
To which accused persons pleaded not guilty and claimed trial.
CBI v. Rajat Gupta & Ors. Page11 of 248
Prosecution evidence
17 In order to prove its case, prosecution examined
following witnesses:-
PW1- Sh. Bhagat Ram Sachdeva
PW2- Sh. A. K. Srivastava
PW3- Smt. Rekha Paswan
PW4- Smt. Sushma Kaur
PW5- Sh. Triveni Giri
PW6- Sh. Mahendra Kumar Bansal
PW7- Sh. Rajiv Gaur
PW8- Sh. J. Rajender Prasad
PW9- Sh. Sumer Chand Jain
PW10- Sh. Satvinder Singh
PW11- Sh. Pradeep Kumar Aggarwal
PW12- Sh. S. R. Bansal
PW13- Sh. Mahesh C. Sanjanwala
PW14- Sh. C. P. Singh
PW15- Sh. P. Ramanujam
CBI v. Rajat Gupta & Ors. Page12 of 248
PW16- Sh. Ajay Mendiratta
PW17- Sh. K. B. Poojari
PW18- Sh. Ravinder Bhatia
PW19- Sh. Basant Kumar
PW20- Sh. Yashpal Taneja
PW21- Sh. Subhasish Sarkar
PW22- Sh. Ramesh Kukreja
PW23- Sh. Ramesh Madan
PW24- Sh. G. L. Khandelwal
PW25- Dr. S. C. Mittal
PW26- Sh. Om Prakash Parida
PW27- Sh. Dinesh Kumar Saxena
PW28- Sh. Hardeep Singh
Prosecution evidence was closed vide order dated 29.04.2016.
Statement under Section 313 CrPC 18 Statement under section 313 Cr.P.C. of the accused persons recorded. In statement under Section 313 CrPC, accused CBI v. Rajat Gupta & Ors. Page13 of 248 persons denied all the incriminating material appearing in evidence against them and claimed innocence.
Defence Evidence 19 In his defence, accused persons examined DW1 Sh. Anoop Sharma. Defence evidence was closed vide order dated 03.12.2015.
Appreciation of Evidence 20 PW1 deposed that during the period June 1999 to 2001 I was posted as Chief Manager, Dena Bank, Scope Complex, Lodhi Road, New Delhi. When he joined the branch, Chief Manager was not there as he was posted at Calcutta. There was only one Sr. Manager Mr. Basant Kumar Gutpa at the branch at that time. So, he did not take charge from anyone in the branch and he joined and took the charge himself. He informed vide letter no. 1802/FC/REC Noida 99-2000 dated 05.07.1999 addressed to Branch Manager, Dena Bank from UPFC, Nodia which was received by me on CBI v. Rajat Gupta & Ors. Page14 of 248 09.07.1999 and he identified his initial at point A. The letter is Ex. PW1/A and it was pertains to A4.
He further deposed that he was informed Mr. Sanjanwala was Chief Manager (Vigilance), Dena Bank at Ahmedabad. He had informed him that he had received an anonymous complaint against A4 and they had submitted some forged NOC of UPFC. PW1 accompanied him to the office of UPFC. Prior to going to the office of UPFC, Mr. Sanjanwala had inspected the files and documents at the branch. The documents were lying scattered and he assembled/arranged the same and prepared his report. The loan documents were among the scattered documents in the same file which were assembled/arranged by him. Marks PW1/X-1 and PW1/X-2 (D-6 &7) were lying in the said file un- arranged. At UPFC they met concerned officer there and made a written request to certify the genuineness of Ex. PW1/A and Mark PW1/X-1 and Mark PW1/X2. Ex. PW1/B is a letter of Dena Bank (Carbon copy) addressed to Regional Manager, UPFC dated 17.09.1999. It bears signature of PW1 at points A & B. CBI v. Rajat Gupta & Ors. Page15 of 248 He further deposed that Ex. PW1/C is letter No. 3819/FC/REC/Noida-99-2000 dated 22.09.1999 of UPFC addressed to Chief Manager, Dena Bank. It was sent by UPFC in response to Dena Bank's letter Ex. PW1/B. This letter was received in the branch on 24.09.1999 and bearing initials and date at point A of PW1.
He further deposed that vide this letter UPFC confirmed the genuineness of letter Ex. PW1/A and further informed that Mark PW1/X-1 and Mark PW1/X-2 were forged and fake documents. Mark PW1/X-4 is letter of A4 dated 07.09.2000 addressed to Chief Manager, Dena Bank, Scope Complex, New Delhi. Copy of this letter marked to Dy. General Manager and the same is Mark PW1/X-5.
During cross examination on behalf of A1, PW1 deposed that he went with Sanjanwala once to UPFC office, Noida and the whole record was taken in the custody Sanjanwala. He went Sanjanwala alongwith the letter Ex. PW1/B. The month of the letter Ex. PW1/B is not clear and was written by Sh. Ramesh Kukreja, CBI v. Rajat Gupta & Ors. Page16 of 248 Manager, Dena Bank. The original of this letter is lying in Noida office of UPFC. PW1 could not identified the signatures at point B. Reference number mentioned at Ex. PW1/B was written at directions of PW1. It was addressed to the concerned Branch and bears the date of receipt 24.09.1999 at point A. Ex. PW1/B was written at the directions of Sh. Sanjanwala. Mr. Sanjanwala came to the branch and the advised PW1 to write a letter to address UPFC Noida and he contents were written from the record. He submitted his letter to UPFC, Nodia and informed they would sent the reply directly to branch of PW1. Ex. PW1/B is office carbon copy. Ex. PW14/7 was written by PW1 to Deputy General Manager, Dena Bank in reply of letter bearing no. HO/NIO/349/2000 of GM, North India Operation. PW1 had given comments to the reply of the above said letter which are mentioned in details in the above said letter.
PW1 further deposed that the sufficient securities were not there then the Branch recommended not to release any limit.
Upon specific question PW1 further deposed that there was sufficient security for recovery of bank money and to recover CBI v. Rajat Gupta & Ors. Page17 of 248 the bank advances.
He further deposed that plant and machinery were lying in the wooden boxes and after opening the same the branch wrote the letter to the next authority to make it assessment from the qualified engineers. He denied the suggestion that Ex. PW14/7 is an incomplete letter and it is not having the full picture of collateral security given to the bank. He denied the suggestion that valuation of the machinery was done by the approved valuer of the branch of the bank and the valuation was certified as Rs. 11 Crores.
PW1 further cross examined on behalf of A2 and A3 and admitted that Mr. B.K Gupta Senior Manager was looking after the branch as Incharge in the year 1999. He was head of the credit department and he remained the head of the credit department for a period of 2-3 months approx.. He further admitted that all the files pertaining to the loans, advance used to with the credit department under the lock and key of Mr. B.K Gupta. He further admitted that Mr. Ramesh Kukreja was working as Manager, Credit Department and he joined the branch as Chief Manager. PW1 received Ex.
CBI v. Rajat Gupta & Ors. Page18 of 248 PW1/A in the month of July. He further admitted that prior to the visit of Mr. Sanjanwala EX. PW1/A was already received.
PW1 further deposed that after the visit of Mr. Sanjanwala, on his advise, he summoned all the files and documents from the Credit Department and the same were handed over to PW1. Mr. B.K. Gupta did not place before PW1 all the file of loans and advances, when he joined as Chief Manager, although Mr. B.K Gupta was officiating Chief Manager. The credit Manager is concerned with the files of the advances and loans, so, he was not aware, how much files were there in the branch concerning with loans and advances. The file of M/s Aviquipo of India was not proper and all the papers were scattered. When the files placed before PW1, he got the file in order in the presence of Mr. Sanjanwala. The record was taken by Sh. Sanjanwala in his custody who disclosed that some anonymous complaints have been received from the bogus NOC submitted by A4. The concurrent audit is conducted by the official of auditor and he remained all the time in the bank in working days. The every month report of concurrent audit is placed CBI v. Rajat Gupta & Ors. Page19 of 248 before the Chief Manager and the Chief Manager is supposed to certify that the discrepancies reported in the monthly report are in the knowledge of branch, whereas the report is submitted in the branch is to be signed by the Concurrent Auditor and the Chief Manager. He denied the suggestion that he was aware about the fact with the accounts of A4 was standard upto January, 2001. He denied the suggestion that he did not visit the office of UPFC. 21 PW2 deposed that during the year 1999 Mr. S.K. Pasari was the Regional Manager as Chief Manager at UPFC, Nodia. He further deposed that Mark PW1/X-1 bears forged signatures of Sh. S.K. Pasari at point Q-1. Letter is Ex. PW2/A. Similarly, Mark PW1/X-2 also bears forged signatures of Sh. S.K. Pasari at point Q-
9. The said letter is EX. PW2/B. He further deposed that S.K Pasari has since expired. He further deposed that since both the letters were forged and were not issued from his office.
During cross examination on behalf of A1, PW2 deposed that he had worked under Sh. S. K. Pasari and familiar with his CBI v. Rajat Gupta & Ors. Page20 of 248 writing and signatures. He denied the suggestion that he had never seen Sh. S.K. Pasari writing and signing.
During cross examination on behalf of A2 and A3 he denied the suggestion that he had never dealt with the file of A4. 22 PW3 deposed that she was posed as receptionist, UPFC, Ghaziabad, Noida, U.P. Her duty was to receive all the correspondence in the name of the Regional Manager. On the letter itself she used to put her initials and after entering in Dak Receipt Register, she used to send the same to the Regional Manager. She seen letter no. NZ/98-99/003 dated 13.04.99 which bears some signatures above the name of Smt. Rekha. However, the signatures at point Q-9 are not of her.
PW3 further deposed that whenever she used to receive any letter, she used to put the official seal of UPFC on the same. Ex. PW3/A does not any seal of UPFC. She had seen specimen handwriting sheets bearing no. S-253 to S- 263 (11 sheets). These are in her handwriting and EX. PW3/B-1 to B-11.
CBI v. Rajat Gupta & Ors. Page21 of 248 During cross examination on behalf of A1, PW3 deposed that she was only Diarist working in the reception of UPFC as receptionist. In her absence, one Mr. Giri used to work in the reception of UPFC. A dak receipt register used to be maintained in the office which must be available there in the record. She cannot produce the said register since she has already retired from the service, Entries dated 13.04.1999 of Dak Receipt Register would show whether she was present in the office on that date or not. Factum of her presence in the office can also be ascertained from the attendance register. Testimony of the witness remained unchallenged on behalf of other accused.
23 PW4 Smt. Sushma Kaur, Superintendent (P) UPFC was given up by Sr. PP CBI.
24 PW5 deposed that in the year 1999, he was working as Record Keeper in UPFC and was also doing the duty of diary and dispatch. He had seen UPC certificate containing six addresses of CBI v. Rajat Gupta & Ors. Page22 of 248 the persons to whom the letters were sent. He had seen the carbon/office copy of letter no. 648/FC/REC/Nodia-99-2000 dated 06.05.1999 of UPFC addressed to M/s Aviquipo of India Ltd, C-82-B, Secot-8, Nodia. Dispatch number 648 and dated 06.05.1999 on this letter in his handwriting which are at point A and B. The letter is Ex. PW5/C. Through UPC certificate Ex. PW5/A, he had dispatched original of Ex PW5/C. During cross examination of A1, PW5 deposed that no separate receipt avaibale in the office to show that Ex. PW5/A was delivered and received in the office A4. As in case of l etters sent through UPC, no acknowledgement is received.
Testimony of the witness remained unchallenged on behalf of other accused.
25 PW6 deposed that during May 2003 he was working as Manager Finance in UPFC, Noida office. He identified his signatures at point A on seizure memo dated 27.05.03 which is Ex. PW6/A through which he had handed over to CBI certified copy of documents mentioned there. This document pertains to different CBI v. Rajat Gupta & Ors. Page23 of 248 loans sanctioned to M/s Aciquipo of India Ltd. Noida bears attesting signatures at point A on all the pages and endorsement on the last page of each is in his handwriting. Such documents are makr PW6/X, PW6/Y and Ex. PW6/Z. During cross examination on behalf of A-1 PW6 deposed that he simply handed over the copies and nothing else was done by him. Testimony of this witness remained unchallenged on behalf of other accused.
26 PW7 deposed that during May 2003, he was on the same post and in the same office. He proved the letter no. NSIC:RON:RMA:18:2003-04 dated 26.05.03 bears his signature at point A and the same is Ex. PW7/A. By this letter, PW7 had forwarded to CBI the original file no. RMA/18 of M/s Aviquipo of India Ltd. and the same is Ex. PW7/B. He further deposed that M/s Aviquipo of India Ltd. had taken raw material assistance of Rs. 15 lacs on 31.03.97 and immovable property as collateral security in place of bank guarantee. The said loan given to M/s Aviquipo of CBI v. Rajat Gupta & Ors. Page24 of 248 India Ltd. turned bad as such legal notice was given through advocate. The said legal notice is Ex. PW7/C. Letter no. 3536/FC.Noida/REC/98-99 dated 14.07.98 was received in our office and it bears the signature of Sh. A.K.Singh Rathor, the then Regional Manager at point A. endorsement on the said letter is Ex. PW7/D. M/s Aviquipo of India Ltd. defaulted in refund of loan of Rs. 15 lacs to the National Small Industries Corp. Ltd. (Govt. of India Undertaking), Noida. Recovery certificate was issued against M/s Aviquipo of India Ltd. The loan amount was refunded vide letter no. NW/1999/036 dated 07.05.99 through bank drafts. Recovery certificate and the said letter are available in file Ex. PW7/B. Vide page no.392 of Ex. PW7/B Dena Bank SCOPE Complex Branch, New Delhi had requested for furnishing statement of account as well als status of account since March 1999 and as on 23.12.99 in respect of M/s Aviquipo of India Ltd.
During cross examination on behalf of A-1, PW-7 deposed that he dealt with Ex. PW7/B only in one month and in May 1997 and thereafter neither the file came or him nor he dealt with CBI v. Rajat Gupta & Ors. Page25 of 248 the same. In pursuance of the RC, payment had been received which was found to be in excess and the excess amount was repaid/returned to M/s Aviquipo of India Ltd. He further admitted that only Rs. 90,000/- had been paid to district Administration towards recovery fees and rest of the amount amounting to Rs. 15 lacs had been paid directly to NSIC after issuance of recovery certificate.
Testimony of this witness remained unchallenged on behalf of remaining accused persons.
27 PW8 deposed that on 23.07.2012, he was posted as Chielf Manager, Dena Bank, Scope Complex, New Delhi. He identified his signature at point A on seizure memo Ex. PW8/A dated 23.07.02. Vide this seizure memo, he handed over CBI the documents pertaining to Loan Account of M/s Aviquipo of India Ltd. which are mentioned at serial no. 1 to 10 on seizure memo Ex. PW8/A. These documents are Ex. PW8/B, Ex. PW8/C, Ex. PW8/D, Ex. PW2/A, Mark Paw1/X-2, Ex. PW8/E, Ex. PW1/B, Ex. PW1/C CBI v. Rajat Gupta & Ors. Page26 of 248 and Ex. PW1/A. He further deposed that after receiving the sanction of required loan, the concerned branch used to the letter for NOC(if any). Photocopy of any NOC received or produced, then it was required to be verified with the original. It is the duty of the Disbursing Authority to verify it. He further proved his signatures at point A on seizure memo dated 26.12.2002 which is Ex. PW8/F. Vide this memo, he had handed over the CBI 2 files of Regional Office pertaining to M/S Aviquipo of India Ltd. which are Ex. PW8/F and Ex. PW8/G. He further proved his signatures at point A on seizure memo dated 17.04.03 which is Ex. PW8H. Vide this memo, he handed over to CBI with documents which are Ex. PW8/1-1 To Ex. PW8/J-6. He further proved his signatures at point A on seizure memo dated 24.05.03 Ex. PW8/K. Vide this memo, he handed over the documents Ex. PW8/K-1 to Ex. PW8/K-3. He further proved his signatures at point on letter No. DB/SCB/Aviquipo/2003 dtd. 12-5-03 on Dena Bank addressed to CBI, the letter is Ex. PW8/L. Vide this letter, he had sent to CBI attested copy of form G(Register of Employment and Remuneration for the month May,1999) pertaining CBI v. Rajat Gupta & Ors. Page27 of 248 to Sh. V.K. Thukral which is mark PW8/K. He further deposed that NOC from the previous banks/institutions required before disbursal of the facility to the borrower by the bank must be in writing and not copy of the same. The Branch Incumbent has no authority to deviate from the condition of obtaining original NOC. He further deposed that Ex. PW2/A is certified copy of NOC dated 11.05.99 for creating charge from Uttar Pradesh Financial Corpn. In favour of M/s Aviquipo of India Ltd. Ex. PW2/B appears to be a zerox copy of a true copy of the letter dated 05.05.99 from UPFC regarding one time settlement. Ex. PW1/B is letter written by the then Chief Manager on 17.09.99 to Regional Manager, UPFC, NOIDA asking him to confirm the authencity of letters dated 05.05.99, 11.05.99 & 05.07.99. UPFC replied vide Ex. PW1/C that letter dated 05.07.99 was issued by them to the Bank and was confirmed. The letters dated 05.05.99 and 11.05.99(Ex. PW2/A and Ex. PW2/B) were forged and fake letters .
Vide letter dated 05.07.99(Ex. PW1/A), UPFC communicated to Branch Manager, Scope Complex Branch that CBI v. Rajat Gupta & Ors. Page28 of 248 accounts of M/s. Aviquipo Ltd had become NPA and recovery proceedings have been initiated. He further deposed that carbon copy of an inspection note dated 12.11.99 submitted by B.R. Sachdeva, Chief Manager; Shri S.C. Jain and Ramesh Kukreja regarding visit to site of M/s Aviquipo of India Ltd for inspection of plant and machinery. It bears signatures of all three at points A to C respectively on Ex. PW8/M. The valuation of the machinery was also done by M/s Gian Chand Associates amounting to Rs. Eleven Crore. The document containing the details of the payments made to M/s Handy & Harman Refining Group for supply of machinery to M/s Aviquipo India Ltd and same is 25.02.2003 running into two pages. It is in hand of PW8 and was signed by Ajay Mehendiratta, same is Ex. PW8/N. Certified extract of register of import bills received under L/C for collection wherein the details of payment made to M/s Handy & Harman Refinary Group on various dates for supplying machinery to M/s Aviquipo India Ltd and certified by Ajay Mehendiratta, Ex. PW8/O. The data of payment mentioned and prepared by PW8 is CBI v. Rajat Gupta & Ors. Page29 of 248 Ex. PW8/N which has been from the original register of import bills.
It is further deposed by PW8 that he joined as Branch Incumbent cum Chief Manager of Scope Complex Branch in 2001, the account of M/s Aviquipo of India Ltd had already become NPA and therefore the bank filed the suit against the said firm in 2002 for recovery of about 8.40 crore at DRT, Delhi.
The statement of PW8 were recorded by the CBI firstly in Nov. 2002 then in Feb. 2003 and then again in May 2003.
During cross-examination by accused no. 1, PW8 deposed that he had not handed over other documents to CBI except those mentioned in his statements. He admitted that he has no personal knowledge about these documents and he has produced the same to CBI as required by them. All the proposals of a loan originating from branch or regional office were sent to the Sanctioning Authority. Sanctioning authority is Head Office.
It is further admitted that any deviation can be made only from sanctioning authority and none else can do to the same. All the terms and conditions have to be accepted by the borrower. The CBI v. Rajat Gupta & Ors. Page30 of 248 Credit Officer is posted in the branch for the purposes of preparation of any proposal submitted to the branch by the borrower. The note Ex. PW14/6 was approved by GM for disbursal of term loan and letter is mentioned in Ex. PW8/K2 . Ex. PW8/D1(Mark PW11/A) is a letter dated 13.07.98 and appears to have been written to Chief Manager Dena Bank, Scope Complex by the Director of Aviquipo of India Ltd and the name of Director is mentioned as Praveen Kumar but PW8 was unable to identify the signatures appearing on the document. He cannot identify the signatures of Praveen Kumar in another letter Ex. PW8/D2, Ex. PW8/D3, Ex. PW8/D4. Ex. PW8/N is in handwriting of PW8 but Ajay Mehindiratta had signed it. The amount of RS. 15,79,94,887/- was paid to the foreign supplier of the Machinery which was written by PW8 in the branch of the bank. There was no reason of not writing application Ex. PW8/N on the Letter Head of the Bank. Although the letter head/pads were available. PW8 came to branch from Bombay in July, 2001 and remained there in the branch upto 2003. Ex. PW8/C is a branch letter written to the party the borrower on the basis of the sanction CBI v. Rajat Gupta & Ors. Page31 of 248 given by the Competent Authority and accepted by the party. The only role which he placed in the matter is that having over the documents to CBI as and when they for the records. He further admitted that he filed a case in the DRT. During cross-examination of PW8 by accused no. 2 & 3, he admitted that he stated to the IO in the statement under Section 161 Cr.P.C. that as per the document which is Mark PW8/X is a Muster Roll of the employees, the employee was on leave from 14.5.1999 to 19.5.1999 and thereafter he was relieved for Calcutta. He further admitted that as per the document Mark PW8/X, the employee was at Bombay on 4.5.99 and 5.5.99 and he had further admitted that as per his statement recorded by the CBI, the payment was disbursed on 14.5.99, 19.5.99,21.5.99 and 26.5.99.
28 PW9 deposed that in the year 1999, he was posted as Manager in Scope Complex Branch of Dena Bank where he was Incharge of Foreign Exchange Section.
During his posting at the aforesaid branch, A3 was Chief CBI v. Rajat Gupta & Ors. Page32 of 248 Manager. He further deposed that file Ex PW8/J7 containing 51 pages pertains to A4. He had dealt with some of the documents in this file. He knew A1 who used to come to him. Ex PW9/A is a letter from Fleet National Bank addressed to the branch which was received in the branch on 30.03.1999. He identified his initials at point A. Alongwith this letter, airway bill, invoice in qua duplicate, packing list in qua-duplicate and certificate of insurance in duplicate were also received. These are Ex PW9/A1 to Ex PW9/A11. A4 had imported one complete gold and alloy atomization plant in SKD conditions packed in 11 wooden crates amounting to US $36,80,000. He identified his signatures at point A on Ex PW9/B which is letter dated 05.04.1999 by which his branch informed A4 about receipt of documents from Fleet National Bank for collection of payment. He identified his signatures at point A1 at Ex PW9/C which is letter AVQ/NZ/99/004 dated 16.02.1999 of A4 signed by Executive Director A1 at point Q32. Vide this letter request was made to the bank for making part payment amounting to US $6,97,000. He further identified signatures of A1 at point Q12 on Ex CBI v. Rajat Gupta & Ors. Page33 of 248 PW8/J2 which is a cheque no. 116633 amounting to Rs. 2,98,99,692/- favouring 'Yourself' drawn on Dena Bank. Ex PW9/D is carbon copy of Form A1 application for remittance in foreign currency dated 16.02.199. It bears signatures of PW9 at point A and of A1 at point Q33, Q34 and Q35. Ex PW9/C bears signatures of A3 at point A for authorization of payment in foreign currency. The payment was made from the funds of company in the current account no. 21387.
Ex PW9/E is letter dated 14.04.1999 from Fleet National Bank in response to the letter which was forwarded with Fleet National Bank bearing date 29.02.1999 under signatures of PW9. A request from A4 under signatures of A1 at point Q36 for remittance of US $ 9,20,000 was received which is Ex PW9/G. Cheque no. 116648 dated 14.4.1999 favouring 'yourself' under the signatures of A1 at point Q13 Ex PW8/J3 was deposited in the bank.
At the request of A4 term loan of Rs. 2 crores were debited and credited vide aforesaid documents on 13.05.1999. Form A1 is for application for remittance of foreign currency dated CBI v. Rajat Gupta & Ors. Page34 of 248 13.05.1999 for US $ 9,20,000. It bears his signatures at point A and that of A1 at point Q37 and Q38. Form A1 is Ex PW9/H. The request was authorized by A3 by putting his signatures at point A on on Ex PW9/G. Request dated 19.05.1999 was again received for remittance of US $ 6,97,000 as part payment for A4 under the signatures of A1 at point Q39. Request letter is Ex PW9/J bearing endorsement and signatures of PW9 at point A. Sh. B. K. Gupta, the then Sr. Manager at point B. On the same day cheque no. 116656 for Rs.2,98,90,958/- favouring 'yourself' under the signature of A1 at point Q14 was received in the bank. The said cheque is Ex PW8/J4.
Form A1 is carbon copy of application for remittance in foreign currency for US $6,97,000 bearing signatures of PW9 at point A and that of A1 at point Q40 and Q41. Form A1 is Ex PW9/K. Payment was released in favour of Handy and Herman as part payment. Another request was again received for remittance from A4 dated 21.05.1999 for US $ 6,97,000 bears signatures of A1 at CBI v. Rajat Gupta & Ors. Page35 of 248 point Q42 at point Q15 at cheque. Request letter is Ex PW9/L. This remittance was allowed by Sh. B. K. Gupta by putting his signatures at point A on the letter Ex PW9/L. Carbon copy Form A1 which is application for remittance in foreign currency for US$ 6,97,000. It bears signatures of PW9 at point A and A1 at point Q43, Q44 and Q45. Form A1 is Ex PW9/M. The payment was released in favour of Handy and Harman as part payment.
Branch again received a request for remittance from A4 dated 25.05.1999 for US $6,80,040 alongwith cheque no. 116661 Ex PW8/J6 under the signatures of A1 at point A on the letter at point Q16 on the cheque. Request letter is Ex PW9/N. He further deposed that on the request of A4 dated 26.05.1999, amount of Rs.1,49,70,000/- was debited from Loan A/c no. 3981 of A4 and credited to current account no. 21387 of A4.
Carbon copy Form A1 which is Ex PW9/P is application for remittance for foreign currency for US $ 6,80,040. It bears signatures of PW9 at point A and of A1 at point Q46 and Q47.
CBI v. Rajat Gupta & Ors. Page36 of 248 Payment was released in favour of M/s Handy and Herman as part payment.
During cross-examination on behalf of A1, PW9 deposed that the Manager used to handle the documents of export and import with the guidance of Sr. Manager/Chief Manager. He further deposed that all the amounts were routed through banking challan to the exporter/supplier of the machinery and the same thing happened in the present case.
He has admitted that when he was there, he used to handle it and when he was not there, some other officer might have been handling it.
During cross-examination on behalf of A3, PW1 deposed that he was handling income and outgoing foreign exchange documents during the relevant time. He was the signing authority of Form A and the same was being signed by him with the guidance of Chief Manager. He was singing Form-A in routine as per the guidelines of Chief Manager. Chief Manager was most of the time out of branch and work was going on in his absence. He further CBI v. Rajat Gupta & Ors. Page37 of 248 admitted that debit and credit of a transaction take place same day and the remittance is also being done the same day.
Ex PW9/H in file Ex PW8/J-7, which is a Form-A1. Page 1 which witness identified by him as application form from importers to remit the funds as per the imports. Transaction was taken place on the same day if the funds are there and if the same is cleared by the Chief Manager and if the funds are not there and the same is not cleared by the Chief Manager. Position regarding the availability of the funds is known to them as per the accounts.
Application Ex PW9/K was made on 19.05.1999 and was cleared on same day. Same is the position with regard to document Ex PW9/M. Ex PW8/N is a letter which was not written by PW9. He worked in this bank upto to 31.03.2001. He admitted that there was a separate credit department in the Scope Complex Branch and the same was headed by Ramesh Kukreja and B. K. Gupta, Sr. Manager. He further admitted that Sh. Ramesh Kukreja and Sh. B. K. Gupta were independently handling the files of advances. He has CBI v. Rajat Gupta & Ors. Page38 of 248 admitted that if the Chief Manager is relieved or is on leave then the Sr. Manager takes the charge of the Branch and worked as Acting Chief Manager.
The procedure for remittance in Foreign Exchange Branch is that parties moved the applicant form for the remittance in a prescribed proforma known as Form A1 and after getting the authorization from the relevant authority/ Chief Manager. He admitted hat ExPW9/H there is no such authorization from Chief Manager/relevant authority. He deposed that a debit voucher may be signed by a single officer, by two officers or may also by three officers depending upon the range of the transactions.
Testimony of this witness remained unchallenged on behalf of A2.
29 PW10 deposed that during the year 1999, he was working as Joint Manager in National Small Industries Corporation, Noida, U.P. At that time, Sh. A. K. S. Rathore was the Regional General Manager in National Small Industries Corporation, Noida CBI v. Rajat Gupta & Ors. Page39 of 248 UP. PW10 had worked under said Sh. A. K. S. Rathore. PW10 identified signatures of Sh. Rathore at point A on letter dated 07.05.1999 at page no. 306 of file Ex PW7/B, which was maintained in the office in respect of financial assistance given to A4. PW10 deposed that he dealt with the said file Ex PW7/B. Testimony of this witness remained unchallenged on behalf of all the accused persons.
30 PW11 deposed that during the year 1996 to 1999, he was working as Officer Scale-I in Credit Department in Regional Office of Dena Bank, New Delhi. He further deposed that Ex PW8/F (D-25) is file pertaining to A4 containing photocopy of the letter dated 06th March 1998 at page No. 242 and 243 which was written by Sh. G. L. Khandelwal, the then Dy. General Manager addressed to Branch Manager, Dena Bank, Scope Complex, New Delhi. He had dealt with the loan proposal in question in the Regional office Dena Bank. The entire correspondence used to be maintained in the office in the regular course of business. At that time, the original CBI v. Rajat Gupta & Ors. Page40 of 248 letters used to be sent to the Branch concerned and the copies thereof, used to be retained in the Regional Office in the relevant file.
PW11 further deposed that file Ex PW8/F pertains to Regional Office of Dena Bank relating to account of A4 which was being maintained at Scope Complex Branch, New Delhi.
Ex PW11/1 is copy of letter dated 06.03.1998 running into page Nos. 242 & 243 which was sent by Sh. G. L. Khandelwal, Dy. General Manager, Regional Office to the then Chief Manager, Dena Bank, Scope Complex, New Delhi and bears impression of signatures of said Sh. G. L. Khandelwal, the then DGM at point A. It is deposed that original of this letter was sent to Scope Complex Branch and this photocopy was kept in office copy file.
Ex PW11/2 is photocopy of letter dated 17.03.1998 placed in File Ex PW8/F and page nos. 237 and 238, running into two pages, which was written by M/s Sabara Impex Ltd. to the Chief Manager, Dena Bank, Scope Complex, New Delhi and the copy of the same was sent to DGM, Regional Officer of Dena Bank. This CBI v. Rajat Gupta & Ors. Page41 of 248 copy was marked to him by Sh. S. R. Bansal, the then Sr. Manager, Regional Office, Dena Bank, New Delhi vide his direction written on this copy alongwith his initials at point A. Alongwith Ex PW11/2, M/s Sabara Impex Ltd. furnished the required information.
Ex PW11/3 is copy of letter dated 30.03.1998 placed in file Ex PW8/F (D-25) at page no. 247, which was sent by Sh. G. L. Khandelwal, the then DGM to Chief Manager, Scope Complex Branch, Dena Bank, New Delhi for providing the duly processed proposal in respect of M/s Sabara Impex Ltd. It bears signatures of Sh. G. L. Khandelwal at point A and initials of PW11 at point B. It also bears handwritten sentence at point C by PW11. In response to Ex PW11/3, A3, the then Chief Manager of Scope Complex Branch of Dena Bank wrote a letter dated 04.04.1998 Ex PW11/4 to DGM, Regional Office for processing the proposal in the Regional Office itself. It bears signatures of A3 at point A. It also bears noting of Sh. S. R. Bansal, Sr. Manager at point B and that of Sh. Vinay Lamba, the then Chief Manager at point C. On Ex PW11/4, he stated that it was the duty of the Branch to submit the proposal CBI v. Rajat Gupta & Ors. Page42 of 248 and in this regard, a reference to the Headquarter Circular be given. In reference to Ex PW11/4, PW11 prepared and put up a draft reminder/letter dated 17.04.1998 which bears his initials at point A and that of Sh. S. R. Bansal at point B and Sh. Vinay Lamba at point C. The said draft reminder/letter is Ex PW11/5. On Ex PW11/5 Sh. G. L. Khandelwal, the then DGM put up a noting stating that they may process the procedure as requested by Scope Branch and put his signatures thereon at point D. Ex PW11/6 is letter dated 17.06.1998 placed in File Ex PW8/F (D-25) at page no. 252 which was written by Sh. G. L. Khandelwal, the then DGM to the Chief Manager, Scope Complex Branch of Dena Bank for sending the detailed report of A4 which bears signatures of said Sh. G. L. Khandelwal at point A, his initials at point A, initials of PW11 at point B and that of Sh. S. R. Bansal at point C. The said letter is in reference to Ex PW11/6 wherein A3 submitted :- 1) Report of Union Bank of India Ezra Street Calcutta on A4. 2) Project report in detail. 3) Assessment of working capital requirement vide his handwritten letter dated 19.06.1998 which CBI v. Rajat Gupta & Ors. Page43 of 248 bears his signatures at point A and the same is Ex PW11/7.
PW11 further deposed that during his posting at regional office, Dena Bank, he had dealt with by this file Ex PW8/F (D-25) at various occasions being officer working therein. The process note at page No.s 183 to 235 is Ex PW8/F (D-25) was prepared by PW11 under the instructions of Sh. G. L. Khandelwal, the then Dy. General Manager of Regional office of Dena Bank. It was sent to Dena Bank, Scope Complex Branch for checking on their part and also for their recommendations. Thereafter, the said process note was returned by the Scope Complex Branch after checking along with their recommendations. It bears signatures of A3, the then Branch Manager of Scope Complex Branch of Dena Bank at point A. PW11 put his initials at point B thereon and Sh. S. R. Bansal, the then Sr. Manager of Regional Bank officer at point C thereon. Signatures of Sh. Y. P. Taneja, Chief Manager of Regional Office is at point D; Sh. Vinay Lamba, the then Assistant General Manager of Regional Office put his signatures at point E. Sh. G. L. Khandelwal, the then Dy. General Manager at Regional Office puts his signatures at point CBI v. Rajat Gupta & Ors. Page44 of 248 F thereon. The process note alongwith recommendations are Ex PW11/8 (collectively).
Ex PW11/8 i.e. the said confirmed process Note alongwith recommendations and some other concerned documents had been sent to Dena Bank, Head office for sanction thereof.
Office copy of letter placed at page no. 332 in File ExPW8/F (D-25) and the same bears initials of PW11 at point A and that of Sh. S. R. Bansal, the then Sr. Manager, Regional Office of Dena Bank at point B. Said letter is Ex PW11/9.
Head office had sanctioned the loan facility in favour of A4 vide Executive Summary bearing reference no. HO/GM(ORI)/ES/1200/98 dated 12.11.1998. Copy of the said Executive Summary was received in Regional Office of Dena Bank alongwith covering letter of Head Office which is placed at page no. 361 in Ex PW8/F (D-25). The said covering letter bears signatures of Sh. K. B. Poojari, the then Chief Manager (ORI-I) Head Office of Dena Bank at point A. The said letter was received by Sh. G. L. Khandelwal, Dy. General Manager, Regional Office and had put CBI v. Rajat Gupta & Ors. Page45 of 248 signatures at point B thereon. Said covering letter is Ex PW11/10 alongwith Executive Summary of Head Office was sent to Scope Complex Branch of Dena Bank for further action through letter dated 02.12.1998 of Regional Office, which bears his initials at point A, that of Sh. S. R. Bansal at point B, Sh. Y. P. Taneja at point C and Sh. G. L. Khandela at point D thereon. Vide Ex PW11/11, Scope Complex Branch of Dena Bank was intimated about various facilities sanctioned in favour of A4 and which were mentioned in Ex PW11/10.
As per conditions of Executive Summary at Sl. No. 15 under Heading "Other terms and conditions", it was directed by the Head Office to Branch to obtain NOC and Credit Report in respect of existing facilities from Union Bank of India before release of the facilities from Dena Bank to loanee. It was also mentioned therein that credit reports from the bankers of Associates concerns also be obtained before release of funds. A4 vide this letter dated 13.07.1998 had intimated to Dena Bank about bankers of their associates concerns. The photocopy of said letter is Mark PW11/A CBI v. Rajat Gupta & Ors. Page46 of 248 at page no. 312 in file Ex PW8/F (D-25). Said letter was addressed to Scope Complex Branch of Dena Bank by A4 and the same would be available in the said branch. The said letter is part of Project Report, which was submitted by A4 to Dena Bank Branch. A4 had submitted a letter dated 21.12.1998 in Dena Bank Scope Complex Branch for change of guarantors. Dena Bank Branch Scope complex had forwarded the said letter of A4 alongwith their forwarding letter. Forwarding letter is available at page no. 398 and photocopy of letter of A4 at page no. 397 in file Ex PW 8/F (D-25).
At the relevant time A3 was the Chief Manager of Scope Complex Branch of Dena Bank. Sh. G. L. Khandelwal at that time was Deputy General Manager of Regional Office, Dena Bank. In Ex PW8/F (D-25) at page no. 415 is Ex PW11/12, is a letter approved by General Manager for change of guarantors as requested by the company. Ex PW11/12 bears the endorsement at point A at the top of General Manager, Dena Bank.
Ex PW11/13 is letter dated 27.02.1999 written by the branch to the Regional Office recommending company's request for CBI v. Rajat Gupta & Ors. Page47 of 248 acceptance of shares of SNOCHEM India Ltd. as collateral security in addition to shares of Geekay Exim (India) Ltd. which were offered earlier. It was issued under the signatures of A3, the then Chief Manager of Dena Bank, Scope Complex Branch and it also forwarded by DGM to GM for advise. Ex PW11/14 is copy of office note dated 05.03.1999 vide which GM, Head Office, Dena Bank approved aforesaid request for acceptance of shares. The memorandum bears the full signatures of Sh. M. R. Umarji, the then General Manager of Head Office, Dena Bank at point A. This approval was conveyed to the Branch in the note itself by Chief Manager Mr. P. Sen. Signatures of Sh. P. Sen identified at point B. Ex PW11/15 is letter dated 12.03.1999 vide which General Manager approved that the shares may be pledged at industrial Finance Branch of Dena Bank, Mumbai. By this letter it was also approved to open the current account at industrial Finance Branch of Dena Bank at Mumbai. This letter was signed by Mr. M. R. Umarji, the then General Manager of Head office, Dena Bank. It bears signatures of Mr. M. R. Umarji at point A. CBI v. Rajat Gupta & Ors. Page48 of 248 Ex PW11/6 is letter dated 26.12.1998 issued by Chief Manager, Head Office, Mumbai vide which advise to obtain activity wise balance sheet and also consolidated balance sheet. It was issued by Mr. K. B.Pujari, the then Chief Manager, ORI-I and his signatures are at point A. The original letter is placed at page no. 426 of file Ex PW8/F. The original letter Ex PW11/17 was endorsed by Sh. G. L. Khandelwal the then Deputy General Manager to the Chief Manager, Scope Complex for compliance at point A. Ex PW11/18 is letter dated 06.01.1999 issued by A3 addressed to DGM, Regional Office, New Delhi. It bears signatures of A3 at point A. Ex PW11/17 was for obtaining no objection from Union Bank of India, UPFC, National Small Industries Corporation confirming that they would have no charge over the asset of manufacturing division to be located at Noida.
As per system and regulations, it was the duty of the Branch Head in this case the then Chief Manager (A3) to comply with all the terms of sanction before disbursement including obtaining of NOC. Ex PW11/19 is letter dated 18.02.1999 issued by CBI v. Rajat Gupta & Ors. Page49 of 248 A3 addressed to DGM, Regional Office, Dena Bank, New Delhi. This letter was for disbursement of term loan of Rs. 7 crores sanctioned to A4. It bears signatures of A3 at point A. Ex PW11/20 is copy of letter dated 18.02.1999 and the same is enclosure to the letter Ex PW11/19. By this letter request was made by A4 to Scope Complex Branch for disbursement of term loan sanctioned to them. It bears the name of Parveen Kumar, Director of A4. Ex PW11/20 was forwarded by Chief Manger to DGM. By this letter the Chief Manager Branch had confirmed that they had obtained the basic documents and guarantee papers were taken place at Mumbai and the branch recommended the disbursement of the term loan. Ex PW11/21 is letter dated 18.05.1999 issued by Sh. K. B. Pujari the then AGM of Dena Bank, Head office to Regional Authority. By this letter final approval came from Head Office for disbursement subject to compliance of the terms and conditions of sanctions and also the additional stipulations as referred to in the sanction letter for disbursement. The abovesaid sanction was conveyed to the branch on 18.05.1999 CBI v. Rajat Gupta & Ors. Page50 of 248 vide covering letter carbon copy of which is Ex PW11/22. This letter dated 18.05.1999 bears the signatures of Sh. S. R. Bansal, the then Senior Manager of Regional Office at point A. Ex PW11/23 is copy of memorandum dated 05.05.1999 prepared by Mr. K. B. Pujari and approved by GM Sh. M. R. Umarji. By this memorandum the GM has approved the disbursement of term loan subject to compliance of the terms and conditions. It was signed by Sh. K. B. Pujari at point A and bears initials of Sh. M. R. Umarji at point B. Ex PW11/24 is letter dated 08.04.1999 issued by DGM Industrial Finance Branch of Dena Bank, Mumbai. By this letter it was confirmed that the shares which were to be pledged are pledged with their branch.
Ex PW11/25 is copy of document dated 25.09.1999, which was part of same inspection report conducted by Mr. M. C. Sanjanwala. At the relevant time Sh. M. C. Sanjanwala was Chief Manager of Inspection department of Dena Bank at Ahmedabad.
During cross-examination on behalf of A1, he deposed CBI v. Rajat Gupta & Ors. Page51 of 248 that Ex PW11/D1 is letter dated 06.05.1999 of the Head Office from General Manager Bombay allowing the final disbursement subject to compliance of conditions mentioned therein. It was received in the office on 07.05.1999. It bears the endorsement of the then DGM Mr. R. Sridharan Regional Office. This letter was received by the Regional Office on 07.07.1999 and it was faxed to the Scope Complex Branch same day with the endorsement of the Deputy General Manager 'please ensure compliance' at point E. He further admitted that whatever documents admitted in the present case were all from regional office file. Loan was sanctioned by the General Manager and he was competent to sanction the said loan. The GM was the only authority to change and modify the terms and conditions of the said loan. He further admitted that letter Ex PW8/K2 bears the signatures of Sh. Kamal Budhiraja at point A. It was a letter for disbursement of the loan. He has further admitted that Sh. Kamal Budhiraja based on letter dated 06.05.1999 (Ex PW11/21) had released the loan amount on 14.05.1999 and 21.05.1999 and 26.05.1999 on which present note CBI v. Rajat Gupta & Ors. Page52 of 248 of Kamal Budhiraja was written in his own writing regarding the abovesaid disbursement made against the loan. Ex PW11/D2 (D-
16) are extracts of minutes of meeting of the Head Office Committee held on 24.12.1998. He has admitted that in Ex PW11/D2 it also noted that the memorandum contained the credit proposal detailed below sanctioned by General Manager (ORI-I) under his discretionary power was noted. He has admitted that in these extract of minutes the Head Office Committee directed that latest and up dated information be obtained. The branch which was dealing with the present loan was at Scope Complex Lodhi Road, New Delhi. The office was headed by DGM. There were two Chief Managers. The branch of Scope Complex was headed by Chief Manager only. If a dak is concerning to Deputy General Manager normally then it may be put to him only.
During cross-examination on behalf of A2 and A3, it was deposed that in this case one copy of the loan application was submitted by the party to the Scope Complex Branch of the bank and other copy was submitted to Regional Office. He admitted that CBI v. Rajat Gupta & Ors. Page53 of 248 in Regional Office, the credit department is separate. PW11 clarified that generally in all the branches headed by Chief Managers there is a provision of separate officer looking after the credit portfolio.
There were so many officers in the Regional Office to whom various branches were allotted for dealing with all the credit work of particular branch. PW11 was allotted Scope Complex Branch. When he saw balance sheet and audit report and at that point of time the proposal was under process. When PW11 was preparing this process note, Mr. Vinay Lamba was not sitting with him or helping him in any manner. Same is his reply regarding Sh. G. L. Khandelwal the then DGM. He has admitted that whatever proposal was prepared by him was sent to Head Office under the signatures of DGM. He clarified that it was also initialed by him, Sr. Manager Credit and Chief Manager also.
PW11 further deposed that he did not call A3 from Scope Complex branch from my side to help him in preparing the proposal or for getting any clarification. He did not visit the Scope Complex branch while preparing the process note of this company.
CBI v. Rajat Gupta & Ors. Page54 of 248 PW11 further deposed that Ramesh Kukreja and Sh. B.K. Gupta were posted in Scope Complex branch during the relevant time and looking after the credit department.
PW11 further deposed in cross-examination that it is always not necessary that details of banks and institutions with which the companies are dealing is disclosed in the balance sheet. In due course of time he came to know that Mr. Ramesh Kukreja and Mr. B.K. Gupta were working in the branch during relevant time.
He admitted that Ex.PW8/J-10 and PW8/J-11 are vouchers prepared by one officer and were checked by another officer. He clarified that he had not dealt with these vouchers.
He further deposed that this is the general practice that Credit Managers should prepare the vouchers for the disbursement of the loan after going through the process note and the terms and conditions stipulated in the sanctioned note and all other conditions. He admitted that it is the normal practice that the voucher is placed before the competent authority for its approval.
CBI v. Rajat Gupta & Ors. Page55 of 248 31 PW12 deposed that during the year 1996-1999, he was
posted as Sr. Manager, Credit Department at Delhi Regional Office of Dena Bank, New Delhi. Sh. P. K. Aggarwal was also one of the officer in the Credit Department and his duties were to process and re-process the credit proposals sent by various branches for sanction of credit facilities. Ex PW8/B is an application for term loan of Rs.7 crores and working capital finance of Rs. 2 crores from Director of A4 to Chief Manager Dena Bank, Scope Complex, New Delhi.
He further deposed that through Ex.PW8/C Chief Manager Scope Complex Branch. A3 had conveyed the sanction of the aforesaid proposal of A4. It was also signed by A3 on page 14 at point A. As per para no.15 of the aforesaid Ex.PW8/C it was stated that NOC and credit report in respect of existing facilities from Union Bank of India are to be obtained before release of the proposed facilities and that the credit reports from bankers of associate concerned are also to be obtained before release of funds. Same is marked from point A to A. It was the duty of Branch CBI v. Rajat Gupta & Ors. Page56 of 248 Head to call for NOC and credit reports as stated above.
From Mr. P.K. Aggarwal the proposals used to be put forward to him and PW12 used to submit the same to Chief Manager.
Ex PW12/1 is the proposal regarding A4 in file D-13 to D-23 relating to A4. Ex PW12/1 (collectively) was signed by various authorities such as Chief Manager Scope Branch, Chief Manager Regional Office NIO, AGM NIO and DGM NIO at page 31 at point A, B, C and D. Ex PW12/2 runs into 14 pages is approval of aforesaid proposal by GM ORI-I Dena Bank dated 21.11.98 submitted by HO on 12.11.98 for fund based limit for Rs. 8 crores and non fund based limit for Rs. 1 crore. The said approval is in handwriting of the then General Manager ORI-I. Sh. Umarji who has also signed the same at point A. Ex.PW11/1 is a letter written by DGM NIO to Chief Manager Dena Bank Scope Complex, New Delhi asking him to obtain clarifications regarding Sabra Impex Ltd and submit the same CBI v. Rajat Gupta & Ors. Page57 of 248 with his recommendations. M/s Sabra Impex Ltd had moved the proposal to set up an Atomizer Unit based on precious and semi precious metals.
Ex.PW11/2 is clarification of Ex.PW11/1 by Director Sabra Impex Ltd to Chief Manager Dena Bank Scope Complex Branch.
Ex.PW11/3 is a letter dated 30.3.98 from DGM to Chief Manager Scope Complex Branch requesting him to submit duly processed proposal after considering the observations conveyed to him alongwith his comments and recommendations. He identified his initials at point D on Ex PW11/3.
He further deposed that Ex PW11/4 was put up by him vide endorsement at point B to DGM/CM Ex PW12/3 is a draft letter dated 17.4.98 bearing no. NIO ; ICFD ; 2774 ; 98 addressed to Chief Manager Scope Complex Branch and was to be signed by DGM regarding processing of aforesaid proposal of M/s Sabra Impex Ltd. It bears initials of PW12 at point A, those of Sh. P.K. Aggarwal at point B and Sh. Vinay CBI v. Rajat Gupta & Ors. Page58 of 248 Lamba at point C. The copy of same has already been exhibited as PW11/5.
PW12 also referred in his deposition Ex.PW11/7, Ex PW8/C. He also identified his signatures at point B on Ex PW11/9.
Ex.PW12/4 (collectively 14 pages including annexures) are the notings related to A4 and containing details of the limit sanctioned to it. These are the credit proposal sanctioned under discretionary powers by GM (ORI) head office (D-15). The said noting dated 24.11.98 was done by Head Office Committee through GM ORI Sh. Umarji and also bears his signature alongwith date at point A on page 1 of D-15. These were put up by the then Chief Manager ORI-I Sh. K.B. Pujari and also bears his signature at point B on page 1 as well as at point A on page 11. As per annexure attached in Ex.PW12/4, last para the proposal was finally cleared subject to the condition that A4 shall inter-alia provide corporate guarantee of M/s Geekay Exim (India) Ltd and pledge shares of the said company quoted on Stock Exchange of market value of Rs. 150 lacs. The said paragraph is marked from point A to A on page 14 of CBI v. Rajat Gupta & Ors. Page59 of 248 Ex.PW12/4.
PW12 identified his signatures on Ex PW11/5. He further identified Ex PW11/7. He further identified signatures of A3 on the last page of Ex PW8/C. He further deposed that as per this letter, CC hypothecation cum book debts cum PC hypothecation cum bill purchase of limit Rs. 100 lacs with stock margin 25% and debter margin 50% alongwith interest @ 17.60 %, the term loan of the amount of Rs. 700 lac with margin 58% and interest 17.60% to be repaid in 60 monthly instalments of Rs. 12 lacs each as mentioned on page 7, alongwith a letter of credit of limit Rs. 100 lacs with margin 25% was sanctioned in favour of A4.
Ex PW12/5 is part of a file which is Ex PW8/F. Ex PW12/5 is copy of head office sanction cum executive summary of the proposal which was sanctioned to a4 by General Manager ORI- Sh. Umarji at Point A. He has also written that the limit be released on completion of documentation and compliance of other terms as applicable as per sanction. As per condition 15 NOC and credit report in respect of existing facilities was to be obtained from Union CBI v. Rajat Gupta & Ors. Page60 of 248 Bank of India before release of the credit facilities. It has also been mentioned therein that credit reports from bankers of associate concerns before release of funds and the same is Marked from point A to A on page 5 of Ex.PW12/5 in file Ex.PW8/F. Ex PW12/6 is letter vide which the DGM Sh.
Khandelwal has conveyed to the Chief Manager ORI Dena Bank Head Office on 17.11.1998 that the proposal relating to A4 with Scope Complex Branch has been recommended subject to observations contained therein.
PW12 further identified Ex PW1/10, Ex PW11/11 and Ex PW12/7 (from page 380 to 398), letter written by A3 of Scope Complex Branch to the then DGM Dena Bank, North India Operations dated 26.12.1998 wherein he has enclosed a letter dated 21.12.1998 from A4 providing certain clarification on inquiries raised by the bank. It bears the endorsement of DGM alongwith his signatures wherein he has asked A3 to submit his comments/recommendations on the same. Thereupon A3 conveyed his comments and recommendation from the branch regarding said CBI v. Rajat Gupta & Ors. Page61 of 248 project vide his endorsement on the said letter alongwith his signatures at point B. Thereafter, Sh. Khandelwal DGM had endorsed the letter to the General Manager ORI-1 alongwith his signatures endorsing the recommendations of Scope Complex Branch at point C. PW12 further deposed about Mark PW 11/12 which is now Ex PW12/8. He identified signatures of A3 at point A and those of Sh. G. L. Khandelwal at point B on Ex PW11/13. He further deposed that Ex PW11/14 is under the signatures of Sh. Umarji at point A and Sh. K. B. Pujari, Chief Manager ORI-1 at point C and the said note is Ex PW12/9. He further proved Ex PW11/15. At page no. 426 on Ex PW8/F, There is a letter dated 26.12.1998 from Chief Manager ORI-1 to DGM North India Operations wherein he has conveyed the directions of the Head Office Committee to obtain (1) activity wise balance sheet for trading activity and manufacturing activity consolidated balance sheet of the company as a whole, (2) updated personal balance sheet of the guarantors and to ensure to get transfer deed duly executed by the holders of the shares and CBI v. Rajat Gupta & Ors. Page62 of 248 complied with the requirements of Company Law, (3) NOC and confirmation from Union Bank of India, UPFC, NSIC etc that they would have no charge over the assets of the manufacturing division to be located at Noida. The said letter also bears the endorsement of DGM asking the Chief Manager to ensure compliance before disbursement alongwith his signatures at point A. He further deposed that page 427 of Ex.PW8/F is a letter dated 6.1.99 Ex.PW11/18 wherein the Chief Manager of Scope Complex Branch has conveyed to DGM North India Zone that they have conveyed the party to provide the requisite information and the same shall be submitted thereafter.
He further deposed that page 404 of Ex.PW8/F is a letter dated 18.2.99 from Chief Manager Scope Complex Branch to DGM North India Zone wherein he has sought the permission to disburse the term loan of Rs. 7 crores to A4 informing urgency and also that the basic documentation had already taken place and further compliance shall be submitted before disbursement.
He deposed that pages 437 and 438 of Ex.PW8/F is CBI v. Rajat Gupta & Ors. Page63 of 248 photocopy of letter dated 4.9.99 from AGM Legal to Chief Manager ORI regarding request for disbursement of term loan of Rs. 7 crore to A4. It is the legal opinion given by AGM legal.
He further proved and deposed about Ex.PW11/23, Ex PW11/24 and Ex PW11/25.
During cross-examination on behalf of A1, PW12 deposed that circular no. 90/24/98 dated 17.2.1998 which interalia instruct as under, "All credit proposals from Scale-IV branches headed by CM/AGM/DGM to be processed/appraised by respective branches with their recommendations and be placed before the competent authority if the limits recommended the proposal are beyond their respective powers."
He further deposed that the letter is addressed to the Chief Manager, it automatically cover the Scope Complex Branch. He deposed that letter dated 30.3.1998 bears his initials also alongwith initial of other person. He admitted that this letter is also signed by the then DGM.
Letter Ex.PW11/4 is a branch letter addressed to DGM CBI v. Rajat Gupta & Ors. Page64 of 248 whereby a request has been made by branch to process the proposal of the captioned company i.e. Sabara Impex Ltd.
Ex.PW11/5 regarding the proposal of Sabara bears his initials at point B. Ex.PW12/1 is proposal having initials of PW12 in the last of the document at point B. He admitted that Sh. P.K. Aggarwal was his subordinate. He admitted that Mr. P.K. Aggarwal was the processing officer at the Regional Office and he used to put up proposal before PW12 and he submitted it to the higher authorities i.e. Chief Manager/AGM and DGM.
Ex.PW12/2 (D-14) is an executive summary where the General Manager has approved with the remarks that since the company is providing two corporate guarantees having total net worth of Rs. 147 crore, tangible collateral taken to the extent of shares of Rs. 150 lacs.
During cross-examination on behalf of A2 and A3, PW12 deposed that as per the system, the file in regional office is initially dealt by processing officer from where it is put up to PW12 CBI v. Rajat Gupta & Ors. Page65 of 248 and to the senior officers. He admitted that Credit Department is a separate department in regional office.
A3 was Branch Manager during the tenure of PW12. At the time when A3 was Branch Manager, PW12 was posted in regional office at Karol Bagh, New Delhi. Ex.PW12/1 at point D bears signature of Mr. Khandelwal who is Deputy General Manager at Regional office.
The approval in the document Ex.PW12/2 is in the handwriting of General Manager of head office. He admitted that through letter Ex.PW11/4 chief manager of Dena Bank, Scope Complex Branch made a request to DGM (NIO) to process the proposal at their end. He admitted that through letter dated 17.4.1998 is Ex.PW11/5 which was prepared at the regional office upon DGM has given his remark that we may process the proposal as requested by the Branch. The letter Ex.PW11/5 was prepared by the processing officer.
He further deposed that by Margin Money means promoters contribution which is at the cost of the project.
CBI v. Rajat Gupta & Ors. Page66 of 248 32 PW13 deposed that In the year 2003, he worked with
Dena Bank as an officer and his last posting was as Chief Manager Inspection at Ahmedabad. He remained posted in Ahmedabad Branch from June 1995 to March 2001.
On the instructions of Deputy General Manager Bombay of Dena Bank, he did portfolio inspection of branches of Dena Bank at New Delhi in August and September 1999. The instructions were issued for the reason of receiving one anonymous letter addressed to Executive Director Sh. Lal of the bank at Bombay.
He alongwith one of the Sr. Manager Sh. P.P. Shetty visited the Scope Branch of the bank at New Delhi in compliance of the above said directions. All the records of the bank were inspected by PW13 in respect of loan account of A4. Sh. Sachdeva was the Chief Manager of the Scope Branch at New Delhi. They inspected the records of the branch keeping in view whether terms and conditions of sanction proposal were complied nor not.
Inspection report dated 25.9.1999 submitted to Dy. General Manager Inspection and Audit Department, Dena Bank, CBI v. Rajat Gupta & Ors. Page67 of 248 Bombay is Ex.PW13/1. During inspection PW13 found two letters of Uttar Pardesh Financial Corporation (D-6/1) bearing no.263 dated 11.5.99 already Ex.PW2/A purported to have been issued by S.K. Pasari and bearing reference no.236 dated 5.5.99 purported to have been issued to Director of A4 already Ex.PW2/B. During inspection they found Ex.PW2/A and Ex.PW2/B were found forged. A1 was the Ex. Director of A4 has submitted photocopies of these letters. PW13 also sent letter Ex PW7/B. For verification of this letter Mr. Sachdeva Chief Manager, Mr. Kukreja Sr. Mangar and PW13 were went to NSIC Noida. This letter was found to be forged and the same is Ex.PW13/2. These letters were in the records of the concerned department but they were found to be forged. The details have been mentioned in his report Ex.PW13/1. PW13 further deposed that when the recovery was found to be doubtful the account was classified as Non Performing Assets. Sh. P. P. Shetty Sr. Manager Inspection also visited the factory of the company alongwith PW13. At that time the factory was under construction and it was found that 11 wooden boxes said to be containing CBI v. Rajat Gupta & Ors. Page68 of 248 imported machinery were there. Inspite of this the company was asking for further disbursement of term loan amount.
During cross-examination on behalf of A1, PW13 deposed that inspection is also permissible on verbal instructions of the superior officers. He denied the suggestion that in the present case also inspection was on the verbal instructions. He further deposed that he was in Delhi during that period and during that period Dy. General Manager visited Delhi who asked him to carry out the inspection. He was instructed by Dy. General Manager to verify whether the terms and conditions of the sanction have been complied with. He was asked to carry out the inspection by Dy. General Manager when he found certain irregularities in the account at the branch. Mr. Lal was the Executive Director of the bank at the relevant time. He was given the copy of anonymous complaint by DGM to verify and investigate. This complaint was addressed to Mr. Tandon but in heading below the subject where Dear Sir/Madam is written it was written "Dear Mr. Lal". When PW13 visited the office NSIC, it was informed that the letter Ex PW13/2 has not been signed CBI v. Rajat Gupta & Ors. Page69 of 248 by any officer of the NSIC.
He denied the suggestion that no mention of internal audit report of the bank was made by him in his inspection report for the reason that there was nothing incriminating against the account. He further denied the suggestion that he had not taken into consideration the documents which according to him were objectionable and did not taken into account any other document which were explaining the whole transaction involved in the matter in order to support his report and to obey the superiors. He was here in Delhi for more than a month approximately. As he remembered that it was month of September. He further deposed that the sanctioning authority has only to see and make comment that in the present case the loan was sanctioned to the tune of Rs. 6 crores and some lacs where as the party contributed more than Rs. 9 crores. It was for the sanctioning authority to see that how much contribution has been done by the bank and the party. He admitted that the term loans are usually disbursed for establishment of the projects.
CBI v. Rajat Gupta & Ors. Page70 of 248 Mr. Shetty was not reporting to PW13 in the investigation of the case. He was supposed to report to PW13. Mr. Shetty had submit any report that was supposed to be routed only through PW13. He identified signatures at point A at page 7 which are of Mr. P. P. Shetty at two places. The report is Ex PW13/PD1. Forwarding letter dated 26.05.2003 addressed to Sh. A. K. Malhotra, SSP, CBI, New Delhi forwarding PW13's report to Sh. A. K. Malhotra. Same is Ex PW13/PD2. Report was of 15 pages. He further deposed that no report was prepared by him. The report was straightway written by PW13.
During cross-examination on behalf of A1, PW13 deposed that no draft report was prepared by him and the report was straightway written by PW13.
During cross-examination on behalf of A2 and A3 he deposed that he did inspection by sitting in Scope Branch of the bank at New Delhi. The staff of the Advance Department of the branch assisted in showing the documents during investigation. He admitted that in his report Ex.PW13/1 he had mentioned the fact that CBI v. Rajat Gupta & Ors. Page71 of 248 the credit report from the existing banker i.e. Union Bank of India was to be obtained. He admitted that during the course of investigation he came to know that lot of amendments and changes were made at the head office in terms and conditions of sanctioned limit. He admitted that in terms and conditions of the sanction only the existing bankers from whom the credit report was to be obtained was Union Bank of India only. He admitted that the credit report of Union Bank of India was already on record. It is admitted that the amount of Rs. 3 crore was for the payment of the machinery cost against the invoice which was to be imported.
PW13 did not visit to the Regional Office or Head office during the course of his investigation nor he collected any document from the Regional Office or the Head Office.
33 PW14 deposed that on 04.06.2003 he submitted the documents vide seizure memo Ex.PW14/1 (2 pages) signed by him. As per the enclosure to this seizure memo documents mentioned from serial no. 1 to 11 were submitted. Both the CBI v. Rajat Gupta & Ors. Page72 of 248 seizure memo as well as the list enclosed bear signatures of PW14 at point A and those of Hardeep Singh Inspector at point B. PW14 deposed that file containing documents of A4 wherein page 1 of the file is the forwarding letter dated 30.05.2003 by the then CVO of the Bank Sh. T. Ramesh Babu to Sh. A.K. Malhotra SSP. The said document is Ex.PW14/2. PW14 further deposed that documents which were produced by him before CBI and the same are mentioned in the list in seizure memo Ex.PW14/1 as annexures A to K total 90 pages. These documents were produced by PW14 before CBI. In Ex PW14/1 annexures A, B and C are already exhibited as Ex.PW12/1, Ex.PW12/2 and Ex.PW12/4 respectively and annexure D has been exhibited as Ex.PW11/D2, annexure E earlier as Ex.PW11/16 is now Ex.PW14/3, annexures F to K are Ex.PW14/4 to Ex.PW14/9.
PW14 further deposed that he remained posted as PRO at Zonal Office, Dena Bank. DGM Dena Bank, North India Operations has a seat at Zonal Office. The documents were produced by him were being maintained officially in the zonal office.
CBI v. Rajat Gupta & Ors. Page73 of 248 During cross-examination on behalf of A1, PW14 deposed that he has never dealt with this file, he handed over to CBI, in the official capacity. He has not dealt with all the pages of this file. He was in a different department in the zonal office and then came to the present posting in 2003. He deposed that he only handed over this file. He deposed that he did not know anything about this file.
During cross-examination on behalf of A2 and A3, PW14 deposed that the documents were handed over by him to the CBI in CBI office.
34 PW15 deposed that in December 2000 he was posted as Sr. Manager Credit, (Administration Department) at Mumbai. The procedure for obtaining NOC for term loan may be either prior to sanction of the credit limit or subsequent to the sanction of the credit limit but before disbursal of the credit limit. The credit opinion is obtained prior to taking the proposal to ascertain credit limits, nature of operations and also asset classifications of the account. During CBI v. Rajat Gupta & Ors. Page74 of 248 that period the IBA prescribed format is used. In case of NOC it is obtained from the banker's and financial institutions who have also extended the credit limit to the borrower.
In case of large accounts like consortium, multiple banking arrangements where the untied portion or the gap in the funding is included in the minutes of the meetings with due allocation to banks such may be considered as NOC. In case the borrower has already obtained loan or limit/credit from other banks in such cases the concurrence is obtained. In case before the disbursal of the limit, the said concurrence does not come then no disbursal should be made.
He proved Ex.PW8/C which is a letter dated 01.12.1998 containing terms of sanction to A4. He further proved condition at serial No. 15 of this letter which indicates that company was availing the credit limit from Union Bank of India and was to comply with this condition before release of funds/facilities by the bank. It was a duty of the Branch Head to ensure compliance of the terms of sanction and this is true for this case also.
CBI v. Rajat Gupta & Ors. Page75 of 248 NOC has to be in original for accepting it as document for release of term loan, zerox copy whether certified cannot be accepted.
The branch need to take up with the concerned issuing authority confirming the authenticity of said NOC before disbursal in case photocopy of NOC (whether certified or otherwise) has been submitted.
During cross-examination on behalf of A1, PW15 deposed that CBI officer asked him certain questions and recorded his statement. The term 'IBA' referred to Indian Bank Association. It is not a govt. body but is an association of bankers. He denied the suggestion that Ex.PW8/C is a contract between a bank and the borrower. He himself clarified that it is a letter of terms and conditions. All the conditions are binding on both the parties. Ex.PW8/C conveys the terms of sanction to the borrower. This letter is conveying the terms of sanction of the credit limits approved by the competent authority of the bank and not sanction. Ex.PW12/2 and Ex PW12/1 put during cross-examination to PW15. He further CBI v. Rajat Gupta & Ors. Page76 of 248 deposed that both the documents were accepted by A4 as two Directors of the company have signed the letter.
During cross-examination on behalf of A2 and A3, PW15 deposed that if the loan application is received at the branch and the same is processed at the regional office level then it will be the branch which will have to get the formalities completed. The branch is also to oblige to obtain the credit opinion even if the loan is being processed at regional office. He admitted that the branch is having a separate credit department and that all the formalities regarding the credit are being handled by the credit department of the branch. He admitted that if the loan proposal is being processed at regional office and the sanction authority happens to sit at head office then the loan proposal is again appraised at head office level. He deneid the suggestion that credit managers are solely responsible for the credit/loan proposals. The recommendations of IBA become binding upon all the banks once adopted. There were repeated circulars for adoption of IBA guidelines from time to time. He denied the suggestion that there is no circular issued by Dena Bank regarding CBI v. Rajat Gupta & Ors. Page77 of 248 adoption of IBA guidelines. He further denied the suggestion that in case the loan proposal is dealt with by Regional Office and is to be sanctioned by Head Office then Head Office is only competent to get the NOC.
35 PW16 deposed that he remained posted as Sr Manager in Scope Complex Branch Dena Bank from end of 2001 upto 2003. He had accompanied Shri J. Rajender Prasad, the then Branch Head cum Chief Manager of said branch to CBI office to hand over certain documents. He further confirmed the correctness of details of Ex PW 8/A, Ex. PW 8/B, Ex. PW 8/C, Ex. PW 8/D5, Ex. PW 2/A, Ex. PW 2/B, Ex. PW 8/E, Ex. PW 1/B, Ex. PW 1/C, Ex. PW 1/A, Ex. PW 12/1. He deposed that vide Ex PW8/A vide which 10 documents mentioned therein were handed over to CBI before him and he proved his signatures at Ex PW8/A at point B. He further deposed that copy of those document were also given which were received by Sh. J. Rajendera Prasad who puts his signatures acknowledging the receipt of the same at point C. He further proved Ex PW8/N CBI v. Rajat Gupta & Ors. Page78 of 248 and proved his signatures at point A on its second page, Ex PW8/O and proved his signatures at point A. The certification thereupon is also in his hand.
During cross-examination on behalf of A1, PW16 deposed that he had certified Ex PW8/N but it was not prepared by him. He admitted that he had filed a criminal case before Learned ACMM in the present matter. The complaint was gone through by him before signing the same and all the facts given in the complaint to his knowledge were correct. He admitted that A3 was not mentioned in the array of accused in the said complaint. The said complaint was dismissed as withdrawn on 04.07.2006. The photocopy of the complaint dated 10.05.2002 is Ex PW16/D1. It was signed by PW16 at point A on the last page no. 8. Copy of list of witnesses appended to this complaint is Ex PW16/D2. Same is reply given for list of documents Ex PW16/D3. Copy of affidavit is Ex PW16/D4. Annexure A alongwith the affidavit is Power of Attorney which was filed by him alongwith the complaint. Same is Ex PW16/D5. Annexure B is letter dated 11.05.1998 addressed to CBI v. Rajat Gupta & Ors. Page79 of 248 Chief Manager, Dena Bank by Director of A4. This is an application submitted by A4 for term loan of Rs.7 crores and working capital finance of Rs.2 Crores. Same is Ex PW16/D6.
Photocopy of annexure B is letter dated 01.01.2001 written by CBI SP Jai Swadesh to Chief Manager, Dena Bank, Scope Complex Branch. Same is Ex PW16/D8. The record requisitioned by CBI was forwarded by the bank to CBI vide letter dated 16.01.2001 which is annexure P of the said complaint. Same is Ex PW16/D9. Copy of letter dated 17.07.2002 was written by CBI to Chief Manager, Dena Bank, Scope complex Branch intimating the registration of regular cases under Section 120B read with Section 420/467/468/471 IPC. Same is Ex PW16/D10.
During cross-examination on behalf of A1, he denied the suggestion that there was no condition of filing NOC of UPFC and clarified that there would not have been occasion for submitting the certificate from UPFC. He further clarified that in Ex PW8/C there is one clause 7 in specific condition on case to case basis on page D4/13 from point A to A to the effect that in case of account being CBI v. Rajat Gupta & Ors. Page80 of 248 taken over from other banks, the branch to obtain NOC, no-dues certificate and no charge certificate over the assets from their existing bankers before disbursement of advance.
PW16 further admitted that the whole disbursement amount including the amount was sent directly to the foreign supplier of the machinery through the corresponding bank as mentioned in Ex PW8/N. PW16 certified Ex PW8/N after going through the contents, which were as per record. He denied the suggestion that he was taking keen interest in the matter for some ulterior motive as he had filed criminal complaint against the company and also DRT matter in the case. He is not aware if the DRT matter has been closed or settled.
During further cross-examination on behalf of A1, Ex PW8/A was gone through fully before signing as a witness. He admitted that on 23.7.2002 he was witness to handing over of documents to CBI by J. Rajinder Parsad. At the top of seizure memo item no.1 mentions the case number as RC.BDI/2002/E/0002. The documents as mentioned in Ex.PW8/A were handed over to the CBI CBI v. Rajat Gupta & Ors. Page81 of 248 after the registration of the case.
He was not aware about the contents of Ex.PW16/D-8 and Ex.PW16/D-10. He admitted that the copies of the documents were filed alongwith the complaint before MM. The present case pertains to taking over of laon account from other banks. The case in DRT was filed by PW16.
During cross-examination on behalf of A2 and A3, he admitted he has not filed the complaint against any bank official. He admitted that before filing of the case with DRT the borrower had paid his dues with UPFC.
He remained in Scope Complex Dena Bank for about two years. He admitted that if the loan proposal is beyond the power of the branch the same is sent to Regional Office. If the same is beyond the powers of the Regional Office then it was submitted by Regional Office to Head Office. The Head Office in that event process everything by a technical team and decides the same. He admitted that in case Head Office is satisfy with the proposal made by the party then the same is sanctioned.
CBI v. Rajat Gupta & Ors. Page82 of 248 PW16 denied the suggestion that first he filed case in DRT and thereafter to built up the pressure this complaint case was filed by the Court. He further denied that when the bank was unable to settle the matter despite filing of the complaint then finally the bank approached to CBI by the present case/complaint. He was only a witness to the seizure of documents produced to CBI by Sh. J.R. Parsad.
36 PW17 deposed that in the year 1998 he was posted as Chief Manager in the Secretariat of GM, North India Operations at the head office of the bank at Mumbai. Thereafter in 1999 he was promoted and posted as AGM at the head office in Mumbai.
He was aware of the loan proposal of A4. The same was for setting up of a project for manufacturing of gold/silver powder at Noida. One Mr. Praveen Kumar of A4 used to visit the head office in connection with the aforesaid proposal. The proposal was initiated by Scope Complex Branch, Delhi. This proposal was sanctioned by General Manager, North India Operations. After the CBI v. Rajat Gupta & Ors. Page83 of 248 sanction of the loan, his duty was to follow with the branches and regional office concerned to know the status of the disbursement and to report the status to General Manager as well as to the head office committee which is used to be chaired by the Chairman and Managing Director of the Bank. Apart from the loan proposals he also used to know the status of deposit and business growth of the branches.
He identified his signatures at point A on Ex PW11/10 and the same was signed by him on 21.11.1996 and sent to DGM North India Operations, New Delhi conveying sanction of fund based limit of Rs. 8 crores and non fund based limit of Rs.1 crore in favour of A4. While conveying this sanction he had also communicated to the DGM, New Delhi that a copy of this letter alongwith copy of sanction note was sent separately to Scope Complex Branch for their advance information.
He further deposed about Ex PW11/20. He proved Ex PW17/1 which is letter dated 20.12.1998 signed by him at point A and sent to DGM, North India Operations, New Delhi in reference to CBI v. Rajat Gupta & Ors. Page84 of 248 proposal of A4 wherein at point 3, PW17 had conveyed that the company was at the time also banking with Union Bank of India, UPFC, National Small Industries Corporation etc and had requested to obtain NOC and also confirmation that they would have no charge over to the assets of manufacturing division to be located at Noida. This condition was put by PW17 in order to safeguard the interest of the bank and ensure that the client did not avail loans against the same assets from various banks or institutions as well as to ensure that the applicant was not a defaulter with his earlier creditors and also to ensure that the asset offered by him as prime security to Dena Bank is not already charged or proposed to be charged in favour of his existing banks or institutions.
He further deposed about Ex PW12/5 which contains the executive summary for the said proposal of A4 dated 12.11.98 as approved by GM Operations. There is also one condition no.15 at portion A to A wherein it has been directed that NOC and credit report in respect of existing facilities from Union Bank of India to be obtained before release of facilities and also that credit reports from CBI v. Rajat Gupta & Ors. Page85 of 248 the bankers of associate concerns are also to be obtained before release of funds.
During cross-examination on behalf of A1, PW17 deposed that he remained posted in head office from 1995 till August 2000. His statement was recorded by CBI perhaps in the year 2003. He did not remember the exact date. On being shown his statement U/s 161 Cr.P.C he deposed that he had stated to CBI that he was functioned as Chief Manager in Secretariat of GM North India Operations, Head Office Mumbai from December 95 to August
99. He further deposed that during recording of statement U/s 161 Cr.P.C he stated that the contents from portion A to A, B to B, C to C were stated correctly by him. He admitted that M/s Sabara Impex and A4 were advised to apply for loan facility at Scope Complex Branch, Delhi as other two branches namely Connaught Circus and Karol Bagh were already overburdened with many other large proposals. The processing of the proposal at Head Office is contained in the executive summary from page 336 to 360 in file CBI v. Rajat Gupta & Ors. Page86 of 248 Ex.PW12/5. At portion A in executive summary Ex.PW12/5, the approval has been accorded by General Manager alongwith his comments which read as follows:
"Approved as proposed. Since the company is providing two corporate guarantees having total net worth of Rs.147 crores, tangible, collateral taken to the extent of shares of Rs. 150 lacs".
He clarified that there is a further note of the GM alongwith his signature in portion A itself under the aforesaid note which states "limits to be released on completion of documentation and compliance of other terms". The processing of proposal proceeding the executive summary must be available in the Regional Office and the Branch. As per the procedure any loan proposal is to be processed by the branch initially and then put up to the regional office who thereafter submits the same to the head office if the same is beyond their powers. The proposal received from Branch/Regional Office would be kept in the same condition and any additions/corrections if required would be made separately in a separate note which would be put up for the GM for removal CBI v. Rajat Gupta & Ors. Page87 of 248 which would be reflected in the executive summary. PW17 did not made any change/addition on the face of the proposal Ex.PW12/1.
At page 30 of Ex PW12/1, there are endorsements at points A and B alongwith signatures of PW17 for safeguarding the interest of the bank and have recommended that the LC may be opened for the import of capital goods with cash/FDR margin of Rs. 8.47 crores and further that on receipt of documents under the LC the same to be retired by adjustment of margin money and disbursement of term loan and also that at any point of time outstanding under LC net of margin and term loan not to exceed Rs.7 crores.
PW17 admitted that DGM was senior to him as he was working as Chief Manager at that time. He admitted that the draft proposal received bears initials of the official concerned on each page and that the same initial on page 30 has been covered by his endorsement at point B. Sh. Parveen Kumar Director of A4 approached him for the automiser project NEPZ, Noida and requested for the transfer of CBI v. Rajat Gupta & Ors. Page88 of 248 project report of M/s Sabara Impacts Ltd to M/S AVIQUIPO Ltd."
PW17 initialed all the pages of Ex PW12/2 after going through the same including the additions done by other officer or by PW17. The General Manager while according the approval has written approved as proposed.
PW17 further admitted that GM has sanctioned the loan on the remark mentioned in the executive summary and also the terms and conditions as stated in the executive summary. These are only instructions to release the limit on completion of documentation and compliance of other terms.
He further deposed that Ex PW8/C is sanction letter addressed to the client. It was written by the Scope Complex, Branch, Dena Bank conveying the various terms and conditions to be accepted by the borrower company in pursuance of the loan having been sanctioned by the General Manager under discretionary power.
He further deposed that full and final condition regarding the sanction. General Manager has approved the proposal as CBI v. Rajat Gupta & Ors. Page89 of 248 proposed then he has also mentioned since the company is providing corporate guarantees having total net worth of Rs. 147 crores, tangible collateral taken to the extent of Rs. 150 lacs. The proposal was considered on the basis of these collateral and also on the basis of primary securities offered by the client. The Head office committee was consist of all executives of the rank of Deputy General Manager and above located at the Head office which was chaired by CMD.
He admitted that Ex.PW11/D2 is the extract from the minutes of the meeting of Head Office Committee held on 24.12.1998 wherein there is a noting of credit proposal sanctioned by General Manager (ORI-1) Loans-3. It is also a minute in the said minutes of meeting that the memorandum was put by General Manager ORI Department containing the credit proposal sanctioned by General Manager under his discretionary power was noted. It is also correct that the name of the borrower company is mentioned as M/S AVIQUIPO of India Ltd (New Account) Scope Complex Branch, New Delhi Region and date of sanction is mentioned as 21.11.1998.
CBI v. Rajat Gupta & Ors. Page90 of 248 He further deposed that during the course of the discussion the Chairman or the top executives communicate certain directives. In this case also such directions were made by these executives which were conveyed to the Deputy General Manager North India Operations by letter no. HO/ORI/3288/98.
He admitted that the date mentioned on the letter is 26.12.1996.
During further cross-examination on behalf of A1, PW17 deposed that the inspection of record regarding terms and conditions of sanction are being conducted regularly in the bank by the Inspection Department of the Head Office. He admitted that in the present case loan was sanctioned by the General Manager who had the power to accord sanction in the matter. He identified signatures of GM at point A & B in Ex.PW12/2. The conditions were put in by the Regional Office as mentioned in Ex.PW12/1 (D-13) and these also contain certain additions by PW17 at Head Office while examining the above said proposal which was subsequently approved by GM vide Ex.PW12/2.
CBI v. Rajat Gupta & Ors. Page91 of 248 He further deposed that the report dated 24.11.1998 for the loan was put up before the GM by PW17 on 21.12.1998 vide his signatures at point B and was agreed by him vide his signatures at point A for putting up the same before the Head Office Committee. By putting his signatures at point A, GM ORI had conveyed his acceptance for putting the report before Head Office Committee. He further admitted that Ex.PW12/4 bears stamp of Head Office Committee at points C and D. During cross-examination on behalf of A2 and A3, PW17 deposed that he was posted at the Head office the proposal was received from the Regional Office and it was processed. The Credit Manager is supposed to look after the credit portfolio and in insurgencies he can look after the work of other departments also as assigned by the Chief Manager to AGM. He admitted that the letters pertaining to the files of loans are addressed to the Chief Manager or AGM but submitted before the Credit Manager. He admitted that in the original composite sanction order only Union Bank of India was the banker upon which the company was banking and the CBI v. Rajat Gupta & Ors. Page92 of 248 report as well as NOC was to be sought from Union Bank of India. 37 PW18 deposed that on 19.7.2002 he was working as Astt. General Manager, Canara Bank, Inspection Department. He proved his signatures at point A on Ex PW18/1 which is production memo dated 19.7.2002 vide which the documents mentioned at S.No.1 to 4 were seized by CBI officer Rajat Gupta in his presence. A1 had also signed this document although the same is in a torn condition and his signature did not appear on the document on the date of deposition of the witness.
He had signed photocopy of the memo and he identified the impression of signature of A1 at point B. Same is Ex.PW18/2.
PW18 identified his signatures at point A on each sheet of specimen signature and handwriting of A1 (S1 to S73) on Ex PW18/2 which were taken in his presence on 18.7.2002.
PW18 identified his signatures at point A of each sheet of specimen signatures of A2 (S-74 to S-112) Ex.PW18/4 (Collectively). The signatures and handwritings of A2 were taken in CBI v. Rajat Gupta & Ors. Page93 of 248 his presence on 24.7.2002.
During cross-examination on behalf of A1, he denied the suggestion that on Ex PW18/3 handwriting and signatures of A1 were already filled before they were signed by PW18.
During cross-examination on behalf of A2 and A3, PW18 deposed that he did not remember if in this case the signature or A1 and of A2 were collected same day or not.
38 PW19 deposed that he was posted as Sr. Manager, Dena Bank, Scope Complex Branch, New Delhi from June 1996 to October, 1999. A3 was the Chief Manager of the Branch. Mr. Ramesh Kukreja was Manager (Credit) of the Branch during that period.
He identified signatures of A3 at point A alongwith his initials at point X at page 31 (on top) at Ex PW12/1. A3 had recommended the credit facilities to A4 and therefore signed the saidn proposal as a token of his recommendation. A3 has also put his signatures on page 45 of the said proposal at point A alongwith CBI v. Rajat Gupta & Ors. Page94 of 248 his designation in his own handwriting.
He identified Ex.PW8/C which is the letter conveying sanction of credit facilities to A4. He identified signatures of A3 at point A and the Directors of A4 at point B on page 14 of the said sanction letter.
He further deposed that he was never asked by A3 to write any letter either to Union Bank of India, Kolkata or UPFC, Noida for obtaining NOC for release of funds to A4.
He deposed that Ex PW8/D and Ex.PW2/A were handed over by him to A3.
He identified Ex.PW8/C wherein portion A to A stated that NOC and credit report in respect of existing facilities from Union Bank of India to be obtained before release of facilities. Credit reports from the bankers of associate concern are also to be obtained before release of funds.
He further deposed that since the proposal of loan of A4 was being directly dealt by A3, therefore, he did not himself write any letter for the purpose of NOC from Union Bank of India and CBI v. Rajat Gupta & Ors. Page95 of 248 other creditors of the company and its associates.
He further deposed that when any firm or company approaches the bank through its proprietor or director for fund based or non fund based credit, he has to request in writing alongwith financial statements i.e. balance sheet, profit & loss account and also auditor's report wherever applicable, income tax/wealth tax/sale tax returns and orders for last three years, statements of assets and liabilities of applicant proprietors, partners, directors and guarantors individually, credit reports from the bankers of the applicants and the project report. Thereafter the proposal is processed and any additional information if required is also sought to ascertain the feasibility of the project technically and also its commercial viability. The applicant has to provide correct information for processing the said proposal.
As per his knowledge in banking terminology proposal and process note are one and the same thing.
PW19 further deposed that he did not prepare the said proposal. He was in some meeting and A2 required his initials on CBI v. Rajat Gupta & Ors. Page96 of 248 the said proposal urgently so he had sent a peon to get initials of PW19. PW19 did not examine the proposal in detail as he was told by A3 that the proposal had been processed at Regional Office and there was no need to examine it in detail. PW19 therefore, only looked that the securities offered in the said proposal before putting his initials. Normally the proposal had to be processed and a process note had to be prepared either by PW19 or by Sh. Ramesh Kukreja, the then Manager (credit) but this proposal was neither processed by any of them nor did they prepare this process note.
All the correspondence qua this loan account was done and dealt with by A3. PW19 came into picture only at the time of documentation which was to be done as per format approved by AGM (Legal), Mumbai. He further deposed that he remembered that one of the documents relating to pledge of shares as collateral was not in order and he pointed out the same. Ultimately shares were pledged to the bank as collateral security at Industrial Finance Branch at Mumbai. The aforesaid letters were not verified.
PW19 further deposed that xerox copy of one letter of CBI v. Rajat Gupta & Ors. Page97 of 248 UPFC dated 05.05.1999 certified by A1 as true copy whereby one time settlement towards outstanding dues in A4 accounts with UPFC have been confirmed for settlement by rescheduling the outstanding amount over a period of 18 months. The said letter was shown to PW19 by one Mr. Sanjanwala, Chief Manager who had come from Bombay for inspection of the branch. The said letter is Mark 20/A1.
He further deposed that letter dated 05.09.2000 written by A1, ED of A4 addressed to Chief Manager, Scope Complex Branch under his signatures encircled red as Q-30 wherein on page 2 in first paragraph he has stated "we had submitted two letters purportedly issued by UPFC dated 05.05.1999 and 11.05.1999 regarding the acceptance of one time settlement (OTS) scheme for loan repayment with a protracted payment schedule and NOC respectively". The said letter bears endorsement by the then AGM New Delhi Region Sh. S.M. Gakhar alongwith his signatures at portion A directing the Chief Manager, Scope Complex Branch to put up a status report of the account alongwith observations of audit committee and branch recommendations. The letter is Ex.PW19/1.
CBI v. Rajat Gupta & Ors. Page98 of 248 He further deposed that letter dated 07.05.1999 by A3 bearing his signatures at point A addressed to Branch Manager, Global Trust Bank Ltd., Nariman Point, Mumbai informing sanction of credit facilities of Rs.900 lacs to A4 and also that the borrowers are required to bring in 958 lacs towards promoters contribution major portion of which is being brought in by Mrugank Investments Ltd. and Viplav Trading Company Ltd. and also requesting that since both the said companies are banking with Global Trust Bank since long, so credit reports of the same be provided to Dena Bank, Scope Complex Branch. The letter is Ex.PW19/2.
He further deposed about Ex PW8/J1 (colly) and identified signatures of A1 encircled in red as Q-17 and Q-18 on the same. He further deposed that A4 was having only one account and that letter dated 16.04.1999 written and signed by A1 at encircled Q32 wherein it was informed that they are making part remittance of US Dollar 697000 against their project at NEPZ, Noida to M/s Handy and Herman Refining Group also enclosing the copy of invoice and Form A1 requesting further to remit the amount and advised by their CBI v. Rajat Gupta & Ors. Page99 of 248 collaborators. Said letter is Ex PW9/C. He further identified Ex PW8/J2 which is a cheuqe for an amount of Rs. 29899692/- favouring the bank for debiting the current account of A4 for making the payment as stated in the said letter of Handy and Herman.
He further deposed about Ex PW9/D submitted by A1 under his signatures at points A and B alongwith the aforesaid letter Ex PW9/C. He further deposed that the remittance was thereafter made as is evident from message which is Ex PW19/3 which was the message by Forex Department Connaught Circus Branch, Dena Bank, Delhi confirming the remittance having made by SWIFT. He further identified signatures of A1 at point Q36 on letter dated 12.05.1999. He further identified letter Ex PW9/H under the signatures of A1 at mark Q37 and Q38. He further identified Ex PW8/J3 which cheque submitted by A1 under his signatures at point Q-13. The said remittance as requested vide letter Ex PW9/G was okayed by A3 putting his signatures at point A, as per the SWIFT message which is Ex PW19/4.
He identified Ex PW8/J8 and Ex PW8/J9. He identified CBI v. Rajat Gupta & Ors. Page100 of 248 signatures of Ramesh Kukreja himself at point A and B on Ex PW8/J9. He further identified Ex PW8/J10 and Ex PW8/J11 which bear signatures of A3 and PW19 at points A and B respectively. He further identified Ex PW8/J12 and Ex PW8/J13 which bears signatures of Ramesh Kukreja and Kamal Budhiraja at points A and B respectively.
He further identified Ex PW9/L whereby A1 had requested for remittance of US Dollar 697000 to M/s Handy and Herman. The remittance was accordingly made as evident from SWIFT message Ex PW19/5. The said remittance was okayed by PW19 vide his signatures at point A on Ex PW9/L. He further identified letter written by A1 to Chief Manager, Scope Complex Branch dated 25.05.1999 and 26.05.1999 Ex.PW9/N and Ex.PW19/6 whereby A1 has requested for remittance of US dollar 680040 vide Ex.PW9/N to the supplier M/s Handy and Herman Refining Group and has intimated his refusal to pay the bank charges of US dollar 159 and also that the exact invoice value of US dollar 3691040 be remitted as final payment of CBI v. Rajat Gupta & Ors. Page101 of 248 invoice. The remittance was made as is evident from the SWIFT message dated 26.05.1999 at page 47 of file which is Ex.PW19/7. He further deposed that Ex.PW8/J12 and Ex PW8/J13 are the credit and debit vouchers bearing signatures of Sh. Ramesh Kukreja, Manager (Credit) and Kamal Budhiraja, Acting Chief Manager at points A and B respectively vide which Rs.14970000/- was debited from loan account 3981 of A4. and credited to current account no. 21387 of the said company for making further payment to M/s Handy & Herman as per party's instructions.
He further proved statement of account of term loan account no. 3981 from 14.05.1999 to 13.03.2003. Entries dated 14.05.1999, 21.05.1999 and 26.05.1999 collectively marked as 'X' in the statement show the loan amount disbursed to A4 i.e. Rs.20000000/-, Rs.30000000/- and Rs.14974000/-. The said statement is Ex PW19/8 certified by A.K. Mehndiratta, the then Chief Manager.
Account statement of current account no. 21387 of A4 from 01.01.1990 to 13.03.2003, the loan disbursed to A4 in loan CBI v. Rajat Gupta & Ors. Page102 of 248 account no. 3981 and then transferred to current account no. 21387 is shown vide entries X-1, X-2 and X-3 respectively on 14.05.1999, 21.05.1999 and 26.05.1999 respectively. The party had itself deposited the amounts on 16.04.1999, 11.05.1999, 19.05.1999 and 25.05.1999 vide entries marked Y-1 to Y-4 respectively. The remittances were made by the bank by adding the loan amount disbursed vide entries X-1 to X-3 stated above on 14.05.1999, 21.05.1999 and 26.05.1999 vide entries Z-1, Z-2 and Z-3 respectively whereas the remittances were made by the bank on deposit of amount by party vide entries Z-4 and Z-5. The said statement of accounts of current account no. 21387 D-70 is Ex.PW19/9. There is a discrepancy in the vouchers mentioned above Ex.PW8/J12 and Ex.PW8/J13 in the amount which is erroneously mentioned as Rs.14970000/- instead of correct amount Rs.14974000/- as correctly depicted in the aforesaid account statement Ex.PW19/8 and Ex.PW19/9.
He further identified letter dated 21.05.1999 written by A1 in his handwriting and his signatures marked Q-27 whereby A1 CBI v. Rajat Gupta & Ors. Page103 of 248 had requested to disburse the pro-rata portion of term loan immediately. PW19 had put a note on the same under his handwriting and signatures marked X to the effect that the balance term loan be disbursed after promoter brings in his entire contribution margin i.e. 58%. This letter is Ex.PW19/10.
As per account statement of term loan account no. 3981 Ex.PW19/8, A4 has paid interest in the said account which is Rs.127780/- on 30.06.1999, Rs.2851907/- on 30.09.1999, Rs.2815420/- on 31.12.1999, Rs.2719367/- on 31.03.2000, Rs.2654160/- on 30.06.2000, Rs.2737356/- on 30.09.2000 totaling to Rs.15056010/-. Another entry dated 30.12.2000 of Rs.2708272/- qua interest has been reversed on 31.03.2001 as the account had already become NPA. Statement of PW19 was recorded by CBI.
During cross-examination, on behalf of A2 and A3, PW19 deposed that he did not know whether the party had applied for the loan at the branch or at regional office or at head office. He admitted that the proposals are to be processed at Branch. He denied the suggestion that any discussion was carried out by him as CBI v. Rajat Gupta & Ors. Page104 of 248 Sr. Credit Manager with A3 regarding proposal at the branch. He denied the suggestion that PW19 insisted to process the loan proposal at the branch with A3. He denied the suggestion that A3 refused to process the proposal of loan in branch inspite insistence of PW19 for the same. He denied the suggestion that A3 had sent letter dated 04.04.1998 which is Ex.PW11/4 to Regional Office for processing the proposal at their end.
He admitted that in branch there was a credit department and the same was not an isolated branch. He admitted that being Sr. Manager he was next in position to the Branch Head. The loan and credit files were being dealt by Mr. Ramesh Kukreja. The Regional Office was at Karol Bagh. Chief Manager, NIO, AGM and DGM used to sit in Regional Office. PW19 was at Rajendra Place Branch attending the meeting of concurrent auditors when the said proposal was signed by PW19. A3 had sent him to said meeting as per his verbal instructions. He admitted that the said proposal was processed at Regional office. PW19 did not visit regional office for the purpose of processing of said proposal. He CBI v. Rajat Gupta & Ors. Page105 of 248 denied the suggestion that he alongwith A3 went to the Regional Offices at the instructions of Chief Manager, NIO where PW19 went through the contents of the proposal which is Ex PW12/1 or that thereafter PW19 put his signatures in the capacity of Sr. Manager, Credit of the branch and thereafter A3 in the capacity was also signed by Chief Manager, NIO, AGM, NIO and DGM.
The sanction limit of this proposal was Rs.9 crores as per Ex PW12/1. In 1998-99, the power to sanction a proposal of Rs.9 crores was with Head Office as per his knowledge. He admitted that out of Rs.9 crores of the proposal of A4, Rs.7 crores was term loan. He further deposed that while putting his signatures on the proposal, PW19 had taken a look at securities mentioned at page no. 38 portion A to A, B to B, at page 41 C to C and page 45 D to D of Ex PW21/1. He further clarified that he had taken a cursory look of the proposal while looking for the securities.
PW19 admitted that if the Chief Manager proceeds on leave then Sr. Manager of the Branch will look after his work provided there is a Senior Manager in the branch. PW19 was CBI v. Rajat Gupta & Ors. Page106 of 248 working as a senior manager in this branch when A3 was Chief Manager. He further admitted that he used to look after his work during his leave period. PW19 admitted that he was relieved on 19.05.1999/20.05.1999 as evident from Ex PW19/DA. The endorsement qua the same at point X is in his handwriting. As per Ex PW19/DA, A3 was on leave from 14.05.1999. PW19 was looking after his work from 14.05.1999. He denied the suggestion that A3 was proceeded on leave on 14.05.1999 or had been promoted and had reported at Calcutta or that he had wrongly marked his leave in Ex PW19/DA. PW19 denied the suggestion that he was well aware of the fact that A3 stood relieved in the evening of 13.05.1999. He denied the suggestion that the letter dated 13.05.1999 was received by PW19 in the morning hours of 13.05.1999 and he deliberately did not show the same to A3 till evening of 13.05.1999. He further denied the suggestion that he handed over the abovesaid letter dated 13.05.1999 to A3 in the evening of 13.05.1999. He deposed that he must have dealt with the said letter. He admitted that Ex PW8/C does not specifically mention obtaining of NOC from UPFC CBI v. Rajat Gupta & Ors. Page107 of 248 Noida. He clarified that there is a reference of obtaining NOC from existing bankers before disbursement of advance in condition 7 marked as portion A to A on page D-4/13. He admitted that the said condition was applicable on taking over of account from other banks.
During cross-examination on behalf of A1, he deposed that as a Sr. Manager it was his duty to look after the working of the branch as a second man to the Chief Manager. Ex.PW12/1 is the proposal of loan to A4. This was received in the branch after it was processed in the Regional Office. This note was not processed by PW 19 nor it was so processed by the branch in which he was posted at that time.
Ex.PW8/C which is a letter dated 1.12.98 written by Chief Manager Scope Complex Branch to MD of A4 after sanction of the loan proposal. The said letter bears the signatures of the two Directors/authorizing signatories of A4 on D-4/14 at point B which PW19 could not identify. None of the two signatures is of A1.
He admitted that his signatures do not appear at the top CBI v. Rajat Gupta & Ors. Page108 of 248 of page 31 of Ex.PW12/1.
The letter Ex.PW8/D was handed over to him by A3 on 12.05.1999 alongwith letter dated 11.05.1999 which is Ex.PW2/A. He denied the suggestion that no such letter was handed over to him on the said date by A3. PW19 further deposed that most of the times A1 used to come personally for documentation. He only informed to the Chief Manager about the document relating to pledge of shares as collateral security which was not in order. Thereafter the shares were pledged in Mumbai Industrial Finance Branch which was not a part of Head Office. He deposed that when he placed on record the letter dated 12.05.1999 and 11.05.1999 he had not come across the letter dated 05.05.1999. Letter dated 07.05.1999 Ex.PW19/2 bears his initials and it is also signed by A3 at point A. He admitted that through this letter the credit report from Global Trust was asked for.
He admitted that the voucher is dealt by three officers, one official prepares it, other one checks it and third one approves it. It bears signatures of PW28 at point B. He admitted that handwriting CBI v. Rajat Gupta & Ors. Page109 of 248 at point Y and Y1 is of him on Ex.PW8/J10.
During cross-examination on behalf of A2 and A2, PW19 deposed that Ex.PW8/J11 bears his handwriting the encircled portion at point Y. As per the voucher dated 13.05.1999 he made the endorsement at point Y in Ex.PW8/J11 and at point Y and Y1 in Ex.PW8/J10 on 13.05.1999. He admitted that the loan was disbursed on 14.05.1999 as per Ex.PW19/8 vide entry at point X; the party had submitted a cheque dated 14.05.1999 for Rs.3,94,61,106/- for remittance towards part payment of machinery and that loan was disbursed on 14.05.1999 and that foreign exchange transaction takes place only when the actual transaction took place.
PW19 further deposed that in the present case the loan was disbursed on 14.05.1999 and through Form A1 money was remitted on 14.05.1999. He clarified that for which margin money was deposited on 11.05.1999. He admitted that in the current account party deposit money itself and also can withdraw the same and that on 11.05.1999 party has deposited in its account Rs.2 crore CBI v. Rajat Gupta & Ors. Page110 of 248 from IFB. Party had withdrawal of Rs.80,000/-, again Rs.1 Lac and again Rs.80,000/- on 14.05.1999.
PW19 denied the suggestion that Rs.2 crore was not deposited as margin money on 11.05.1999 but admitted that the loan account was transferred on 14.05.1999 for Rs.2 crore. After the disbursement of Rs.2 crore on 14.05.1999 the bank remitted Rs.3,94,61,106/- to Foreign Exchange for part payment of machinery. Ex.PW8/J8 and Ex.PW8/J9 were checked by Ramesh Kukreja and were approved by him but he could not say who had made these vouchers. He could not identify the handwriting on these vouchers. He admitted that party has given this letter to him i.e. Ex.PW19/10 as he was working as acting Chief Manager on 21.05.1999.
PW19 deposed that Ex.PW8/K2 bears signatures of Sh. Kukreja at point X. The endorsement at point Y is also in handwriting of Mr. Kukreja. On 21.05.1999 when the party gave an application of disbursement of term loan PW19 took the decision himself. He denied the suggestion that since he was dealing CBI v. Rajat Gupta & Ors. Page111 of 248 directly with the party as such he did not ask any bank official for informing him about the status of the term loan account of the party. He denied the suggestion that he had not prepared any disbursement note on 14.05.1999 deliberately and intentionally or that he misused voucher of 13.05.1999 on 14.05.1999. He admitted that normally the voucher is used on the same but it can also be used next day if it is approved by some other authority. He denied the suggestion that A3 was relieved from bank on 13.05.1999 and to this effect he received a letter in bank on 13.05.1999 itself. He denied the suggestion that intentionally and deliberately he marked in the attendance register i.e. muster roll A3 was on leave although he had already been relieved from bank on 13.05.1999 or that he continued to show him on leave till 20.05.1999 or that he did the same with malafide intention as he was misusing the power of Chief Manager by showing the Chief Manager on leave. The responsibility of checking officer in a voucher is to confirm whether it has been approved by the competent authority. He denied the suggestion that in case of loan disbursement voucher the voucher has to be CBI v. Rajat Gupta & Ors. Page112 of 248 prepared first after which it is to be checked and then it is to be approved by competent authority. The voucher dated 13.05.1999 has been approved by competent authority. He further denied the suggestion that no disbursement loan was prepared on 14.05.1999 at the time of disbursement of loan as he with the connivance of Mr. Kukreja misused the voucher dated 13.05.1999.
PW19 admitted that document Ex.PW8/C is Sanction Letter was a part of the contract between the parties.
On seeing Ex.PW8/C, PW19 deposed that 58% is the margin money for term loan. As per this document the limit was of Rs. 7 crore which was the term loan.
PW19 further deposed that since account in this case was converted to a Non Performing Asset (NPA) in such case the account is transferred to Asset Recovery Branch of the Bank. 39 PW20 deposed that he remained posted in Regional Office of Dena Bank, New Delhi during the period 07.07.1998 to CBI v. Rajat Gupta & Ors. Page113 of 248 16.01.1999 as Deputy Regional Manager. Sh. G. L. Khandelwal was DGM at the Regional Office, Delhi. Sh. S. R. Bansal was Sr. Manager (Credit). Sh. P. K. Aggarwal was Manager (Credit). He took charge from Sh. Vinay Lamba who was promoted as AGM.
He further deposed that on being approached a firm or company through its proprietor/Director for fund based or non-fund based credit, the bank asks them to submit the request in prescribed application form alongwith financial statements and other requisite documents alongwith credit report from the existing banker of the applicant as well as project report.
The branch processes the proposal, prepared process note and sends it to Regional authority for further processing. The power of sanction of the proposal as processed by the branch may lie with various authorities depending upon the amount. This particular proposal in the present case was beyond the power of the branch and was therefore sent by the branch for sanction to higher authority.
He identified file Ex PW8/F of Regional Office pertaining CBI v. Rajat Gupta & Ors. Page114 of 248 to A4 for sanction of fund based and non-fund based limit to them.
He identified Ex PW11/8 which is the process note pertaining to sanction of credit facility to A4 and bears signatures of PW20 at point D on the file titled "VII. RECOMMENDATION". The said note was put up before PW20 by Sr. Manager (Credit) S. R. Bansal. PW20 put up the said process note before Sh. Vijay Lamba, AGM and Sh. G. L. Khandelwal, DGM. Thereafter, the process note was forwarded to Head Office vide letter dated 06.08.1998 Ex PW11/9 which bears initials of Sh. S. R. Bansal, Sr. Manager (Credit).
PW20 further identified Ex PW12/5 which is the Head Office note containing executive summary of the proposal of A4 as processed by Head Office whereby proposal for fund based limit of Rs.800 lac, non-fund based limit of Rs.100 lac was approved to A4. He further deposed that there is a condition no. 15 marked portion A to A on page 345 under the head of "Other terms and conditions" in this Head Office note which states that "NOC and credit report in respect of existing facilities from Union Bank of India to be obtained CBI v. Rajat Gupta & Ors. Page115 of 248 before release of facilities. Credit reports from the Bankers of associates concern are also to be obtained before release of funds".
He deposed that page 232 of this file mentions M/s Murgank Investments and M/s Viplav Trading Ltd. as associate of the borrower and the name of the bankers with whom they have credit facility has been mentioned as Bank of Baroda and State Bank of Hyderabad.
He further identified letter dated 13.07.1998 is Ex PW8/D1 of A4 to Chief Manager, Dena Bank, Scope Complex Branch providing the address of the aforesaid bankers of their associate concerns M/s Murgank Investments and M/s Viplav Trading Ltd.
He identified letter dated 21.11.1998 Ex PW11/10 from Head Office, Dena Bank to DGM, Dena Bank North India Operations intimating the sanction of fund based limit of 8 crore and non-fund based limit of 1 crore in favour of A4. This sanction was further conveyed to the Branch by Regional Office vide its letter dated 02.12.1998 already Ex PW11/11.
CBI v. Rajat Gupta & Ors. Page116 of 248 He further deposed about pages 397 and 398 of file which are part of EX PW12/7. Page 398 is the letter dated 26.12.1998 written Scope Complex Branch to DGM, Dena Bank enclosing therewith the request letter of A4 dated 21.12.1998 which is present at page no. 397 onwards (in descending order) of file D- 25 vide which A4 had requested for change of guarantors. Whereupon DGM Sh. G. L. Khandelwal had asked for comments from Chief Manager, Scope Complex Branch vide endorsement A on the said letter dated 26.12.1998 itself. Thereafter, Chief Manager, Scope Complex Branch gave his comments vide endorsement B on the said letter itself on page 398 and then vide endorsement C, DGM mentioned on the said letter itself that they had endorsed Scope Complex Branch's recommendation and sent the same to GM, ORI-I at Head Office. Thereafter, PW20 was transferred from Regional Office.
During cross-examination on behalf of A1, he deposed that he joined in Delhi Regional Office in 1998. In the Delhi Regional Office Sh. G. L. Khandelwal was the DGM. He visited CBI CBI v. Rajat Gupta & Ors. Page117 of 248 office once in the year 2003. He did not receive any letter from the Head Office to appear in CBI office. He clarified that his superior officer instructed him to attend the CBI office.
PW20 further deposed that the letter Ex PW11/5 is from Regional Office where he was posted and it bears the endorsement of Sh. G. L. Khandelwal that "we may process the proposal as requested by the Scope Branch."
He admitted that every page of the process note is initialed by the office who has prepared the same. The same officer has initialed at point B under his signatures at point D. When he put his signatures, it was placed before him by Sr. Manager (Credit). The abovesaid process note was prepared and put up before him on 01.08.1998.
Head office circular is binding on every official of the bank. In the bank whenever movement of the file takes place from one office to the other, it should be entered in the record. PW20 deposed that he was not aware as to whether file was sent to any other office of the bank or not but as a rule movement of file should CBI v. Rajat Gupta & Ors. Page118 of 248 be recorded when the file is sent out of the office. The files of Head Office remained with Head Office and those of regional office remained with regional office. The said file is of regional office and it contains the official communications and letters of regional office with various concerned offices.
The sanction granted by the competent authority is intimated to the borrower by the branch concerned alongwith the terms and conditions to which the said sanction is subject to and on compliance of those terms and conditions, the funds are to be released by the bank.
He deposed that Ex PW8/C which is a letter dated 01.12.1998 purported to have been written by Scope Complex Branch to MD of A4 however, since he was not in knowledge of the said letter, therefore, he could not comment as to whether this letter was actually sent by the branch to the party or whether the party accepted the same or not.
During cross-examination on behalf of A2 & 3, PW20 deposed that his statement was recorded only once by the CBI in CBI v. Rajat Gupta & Ors. Page119 of 248 the year 2003. Prior to the year 2003 he was not examined by any authority with regard to the present case. He was not enquired by the vigilance department of the bank. The present case pertains to the sanctioned loan of Rs.8 crore fund based and 1 crore non- fund based limit. He admitted that the power to sanction limit for Rs.8 crore fund based was vested in the Head Office during that period. The proposal came from the branch and the proposal was processed at Regional Office. He admitted that in big branch there are separate credit departments. He admitted that Scope Complex Branch was also having separate credit department. There is no formal head in credit department at Regional office. S. R. Bansal being a Sr. Manager of Credit Department at Regional Office was heading the department. He admitted that it was the discretion of credit department of regional office to recommend for sanction limit to head office after processing at their end. They might have declined the proposal after processing the same. The officials of the credit department have the vast experience of processing the proposal at credit department.
CBI v. Rajat Gupta & Ors. Page120 of 248 PW20 deposed that being Deputy Regional Manager, he was not the part of the processing of proposal at regional level. He used to examine process note prima facie and then he used to put his initials recommending the same. He admitted that the credit department of the regional department also makes an independent decision about the technical viability and feasibility of the project proposal which is send by the branch.
He deposed that he signed Ex PW11/8 in his office at regional office. EX PW11/8 was prepared by the credit department and the same was put before him by his Sr. Manager namely Sh. S. R. Bansal.
PW20 further deposed that he did not know who has put the condition no. 22 in Ex PW12/5. He could not say who has made the addition and alteration in EX PW12/5. Ex PW12/5 does not bear his signatures. He had earlier also seen Ex PW12/5 during his tenure and the same was shown to him by S. R. Bansal. He could not say when Ex PW12/5 was sent to concerned branch and when he shown document Ex PW12/5 it was having addition and CBI v. Rajat Gupta & Ors. Page121 of 248 alteration or not. These addition and alteration are made with pen. He admitted that as per condition at point A in Ex PW12/5, the only bankers name is Union Bank of India with whom the credit report was to be sought.
He deposed that he did not know if A3, the then Chief Manager had requested the Regional Office for processing of the proposal given by the party for sanction of limit for Rs.8 crore.
The correspondence between the customer and the credit department used to be done between them directly.
He denied the suggestion that he has deposed falsely on the incriminating points against A3.
40 PW21 stated that in June 2003, he was posted as Chief Manager, Vigilance at CVO, Secretariat, Head Office Dena Bank, Mumbai. During that period as directed by CBI telephonically on 26.06.2003 he had forwarded the original letter no. HO/PER/PRO/132/99 dated 05.05.1999 regarding promotion of A3 CBI v. Rajat Gupta & Ors. Page122 of 248 as AGM to CBI vide covering letter dated 27.06.2003. The covering letter dated 27.06.2003 alongwith the said letter qua promotion of A3 dated 05.05.1999 is D-71/1 and 71/2 and bears his signatures at point A on D-71/1. The attached letter dated 05.05.1999 bears signatures of Sh. P. Kumar, GM at point A. Both these letters are now collectively Ex PW21/1.
Testimony of this witness remained unchallenged on behalf of A1.
During cross-examination on behalf of A2 and A3, he deposed that whenever any official takes voluntary retirement or resigns a clearance is taken from the Vigilance Department regarding the fact that if any case is pending against him/her or not.
He admitted that A3 was given clearance from Vigilance Department regarding the fact that no criminal case or departmental proceedings were pending against him. The bank received the request from CBI for supply of letter no. HO/PER/PRO/132/99 dated 5.05.1999 i.e. part of Ex PW21/1. Letter dated 05.05.1999 was supplied to CBI from the record.
CBI v. Rajat Gupta & Ors. Page123 of 248 41 PW22 deposed that he retired from Dena Bank as Chief
Manager on 31.03.2012. During the period from June 1997 to January 2000 he was posted in Dena Bank, scope complex as Manager. During that period A3 was the Chief Manager of the branch. Sh. B.K. Gupta was the Senior Manager of the branch. As manager PW22 was looking after the credit portfolio upto Rs.50 lacs.
After seeing the loan proposal of A4 for sanction of term loan and working capital limit of their project at NEPZ, Noida for manufacturing of atomised products which is Ex.PW12/1, PW22 deposed that this is the proposal submitted by A4 for the above purpose. As per page 31 of Ex.PW12/1, A3 Chief Manager of scope branch recommended for credit facilities to A4. The recommendation at page 31 at point A bears the signatures of A3 and at point X there are initials of Sh. B. K. Gupta Senior Manager.
PW22 further deposed that vide letter dated 01.12.1998 under the signatures of A3, the sanction of limit of term loan of Rs.7 crore, CC hypothication cum book debts cum bill purchase limit of CBI v. Rajat Gupta & Ors. Page124 of 248 Rs.1 crore and letter of credit limit of Rs.1 crore was conveyed to the Managing Director A4. The letter is Ex.PW8/C and bears the signatures of A3 at point A on page 14. The directors of A4 signed at page 14 at point B of letter Ex.PW8/C in token of accepting the terms and conditions of the limits. Below the signatures of Chief Manager A3 at point A, PW22 also put his initials at point C, in token of having check the sanction letter as per head office sanction. At page 11 the above sanction letter at point 15, it is specifically mentioned that NOC and credit report in respect of existing facilities from the Union Bank of India to be obtained before release of facilities. Credit reports from the bankers of associates concerns are also to be obtained before release of funds.
PW22 further deposed that it is the responsibility of the branch head to initiate letters to the financial institutions/banks and obtain NOC before the release of funds. The NOC addressed to the borrower and submitted to the bank are not usually accepted by the bank but if accepted that has to be verified firstly from the issuer of NOC. The verification is usually done by writing letters or by sending CBI v. Rajat Gupta & Ors. Page125 of 248 a bank official to ascertain the genuineness of the NOC. Only thereafter funds can be released subject to the completion of other terms and conditions. He was never asked by A3 to write any letter to ascertain the status of UPFC account.
PW22 further deposed that letter dated 11.05.1999 Ex.PW2/A, has not been dealt by him and he is having no knowledge who has submitted this letter or to whom it was submitted.
PW22 further deposed that memorandum of article of Association of A4 which was submitted alongwith the application by the Director Sh. Praveen Kumar. He identified photograph of A1 affixed on the front of Memorandum of Article of Association. As per the photocopy, certificate of incorporation submitted by the party, A1 has signed as Authorized signatory on the top of it as certified true copy of the company which was issued on 19.04.1945. He identified the signatures of A1 at point A and the certificate is Mark X. PW22 also identified the signatures of A1 at point A & B on the memorandum of association and same is Mark B. PW22 deposed CBI v. Rajat Gupta & Ors. Page126 of 248 that Ex. PW-8/B is an application for term loan, working capital finance, signed by Director Praveen Kumar before the Chief Manager Dena Bank.
PW22 further deposed that proposal Ex. PW-11/8 is the recommendation of the Regional Office who also recommended for sanction of facilities. He identified signatures of A3 at point A as Chief Manager, SCOPE Branch and Sh. Y.P. Taneja, Chief Manager at point D and of Mr. Vinay Lamba, AGM at point E and of Sh. G.L. Khandelwal at point C who was the DGM.
PW22 identified letter dated 21.11.98, Ex. PW-11/10 in the name of DGM Dena Bank by the Chief Manager Bombay in favour of DGM Dena Bank. Vide this letter Chief Manager informed that General Manager has sanctioned a fund base limit of Rs. 8 crore and non-fund based limit of Rs. 1 crore.
PW22 further deposed that letter issued by A1 to the Chief Manager, Dena Bank Ex. PW-8/D request for disbursement. He deposed that letter dated 11.05.99, is a no objection letter for creating charge by the Regional Manager S.K. Pasari which is Ex.
CBI v. Rajat Gupta & Ors. Page127 of 248 PW-2/A. He deposed that he is acquainted with the signatures of Vinod Kumar Thukral, Praveen Kumar, Vinay Lamba and of Mr. G. L. Khandelwal as he had seen them writing and signing in the official course. This proposal of A4 was marketed by Head Office which bears the original proposal of M/s Sabra Impex which was dealt with Head Office Dena Bank Mumbai. PW22 was never asked by A3 and B.K Gupta to write any letter to UPFC for obtaining NOC.
PW22 further deposed that on page no. 102 and 103 is a letter written by A1 to the General Manager Dena Bank, Delhi. He identified the signatures of Rajat Gupta at point A and the letter is Ex. PW-14/A. He further deposed that Ex. PW-19/1 is written by A1. PW22 deposed that in para 4 of Ex. PW-19/A from point A to A1 by A1 Executive Director and the AGM NDR New Delhi made certain comments at encircled point A. PW22 further deposed that D-30 is account opening form of Current Account in the name of A4 having authorised signatories of Sanjay Gupta, A1 and Praveen Kumar alongwith extracts of meeting etc. CBI v. Rajat Gupta & Ors. Page128 of 248 PW22 identified letter Ex PW9/C bearing no.
AVQ/NZ/99/004 dated 16.04.1999 of A4 regarding request to remit US $ 6,97,000/- to Handy and Harman as part remittance. It bears the signatures of A1 at Q32 and also bears signatures of A3 at point A. PW22 identified Ex PW9/D which is carbon copy of form A-1, application for remittance in foreign currency dated 16.04.1999 and it bears the signatures of A1 at point Q33 to Q35. It also bears signatures of Sh. Sumer Chand Jain, Manager of Dena Bank at point A. He identified Ex PW8/J2 which is a cheque bearing no. 116633 dated 16.04.1999 for Rs. 2,98,99,692/- favouring yourself drawn on Dena Bank, to be debited to the current account no. 21387 for making payment to Handy and Harman. It bears signatures of A1 at point Q12.
He identified Ex PW9/G which is a letter dated 12.05.1999 of A4 regarding request to remit US $ 9,20,000 to Handy and Harman by debiting US $ 4,60,000 from its current account no.
CBI v. Rajat Gupta & Ors. Page129 of 248 21387 and US$ 4,60,000 from Term Loan Account. Request bears signatures of A1 at point Q36. It also bears signatures of A3 at point encircled A. PW22 identified ExPW8/J3 which is a cheque bearing no. 116648 dated 14.05.1999 for Rs. 3,94,61,106/- favouring yourself drawn on Dena Bank, to be debited to the current account no. 21387 for making payment to Handy and Harman. It bears signatures of A1 at point Q13.
PW22 identified credit and debit vouchers which are Ex PW8/J-10 and Ex PW8/J-11 at the request of A4, Term Loan of Rs.2 crores were debited and credited vide aforesaid documents on 13.05.1999. Vouchers Ex PW8/J-10 and Ex PW8/J-11 bear signatures of Sh. Basant Kumar Gupta, Sr. Manager at point B and also bear signatures of A3 at point A. PW22 identified Ex PW9/G which is carbon copy of Form A1 application for remittance in foreign currency dated 13.05.1999 for US $ 9,20,000. It bears signatures of Sumer Chand Jain at point A and also bears the signatures of A1 at Q37 and Q38.
CBI v. Rajat Gupta & Ors. Page130 of 248 The request has been authorized by A3 by putting his signatures at point A. PW22 identified Ex PW9/J which is a letter bearing no. AVQ/NZ/99 dated 19.05.1999 of A4 regarding request to remit US $ 6,97,000 to Handy and Harman as part remittance. Request bears signatures of A1 at point Q39. A1 had also submitted alongwith the request letter cheque no. 116656 dated 19.05.1999 favouring bank for Rs.2,98,90,958/- to be debited to its current account no. 21387 for making payment to Handy and Harman. It also bears signatures of Sh. Basant Kumar Gupta, at point B. It also bears the endorsement and signatures of Sh. Sumer Chand Jain at point A. PW22 identified Ex PW9/K which is a Form A1 application for remittance in foreign currency dated 19.05.1999 for US $ 6,97,000. It bears signatures of Sumer Chand Jain at point A and also bears the signatures of A1 at Q40 and Q41. The payment was released to Handy and Harman. The said payment was made out of the funds of the company available in the current account no. 21387.
CBI v. Rajat Gupta & Ors. Page131 of 248 PW22 further identified Ex PW8/J-4 which is a cheque bearing no. 116656 dated 19.05.1999 for Rs. 2,98,90,958/- favouring yourself drawn on Dena Bank, to be debited to the current account no. 21387 for making payment to Handy and Harman. It bears signatures of A1 at point Q14.
PW22 identified Ex PW9/L which is a letter bearing no. AVQ/NZ/99/031 dated 21.05.1999 of A4 regarding request to remit US $ 6,97,000 to Handy and Harman as part remittance. Request bears signatures of A1 at point Q42. A1 had also submitted alongwith the request letter cheque no. 116657 dated 21.05.1999 favouring bank for Rs.2,99,24,148/- to be debited to its current account no. 21387 for making payment to Handy and Harman. It also bears signatures of Sh. Basant Kumar Gupta, at point A. PW22 further identified Ex PW9/M which is a Form A1 application for remittance in foreign currency dated 21.05.1999 for US $ 6,97,000. It bears signatures of Sumer Chand Jain at point A and also bears the signatures of A1 at Q43, Q44 and Q45. The payment was released to Handy and Harman.
CBI v. Rajat Gupta & Ors. Page132 of 248 PW22 identified credit and debit vouchers which is already Ex PW8/J-8 and Ex PW8/J-9 at the request of A4, Term Loan of Rs.3 crores were debited and credited vide aforesaid documents on 21.05.1999. The vouchers Ex PW8/J-8 and Ex PW8/J-9 bears signatures of PW22 at point A and that of Sh. Basant Kumar Gupta, Sr. Manager at point B. PW22 further identified Ex PW8/J5 which is a cheque bearing no. 116657 dated 21.05.1999 for Rs. 2,99,24,148/- favouring yourself drawn on Dena Bank, to be debited to the current account no. 21387 for making payment to Handy and Harman. It bears signatures of A1 at point Q15.
PW22 deposed that letter dated 26.05.99 Ex. PW-19/6 is a letter signed by A1-Rajat Gupta, Executive Director to the Chief Manager, Dena Bank, Scope Complex, in reference to Bank charges as levied by supplier M/s Handy & Harman Refining Group. Letter dated 15.02.99, letter of the bank signed by A3. The said letter was written to the Chief Manager UBI, Kolkata. I identify the signatures of A3 at point A Ex. PW-8/K1.
CBI v. Rajat Gupta & Ors. Page133 of 248 PW22 identified letter Ex. PW-8/K2. He identified the signatures of A1 at point A. This letter was written by A1 for further disbursement for term loan. On the request of the company Sh. Kamal Budhiraja, the then Sr. Manager, who was the branch Incharge, asked him about the status of the accounts viz disbursement and compliance of the terms and conditions. In reply, he informed in writing on the letter itself that the document of $ 3691199 were received on sight basis and part payment of Rs. 5 crore was outstanding as on 26.05.99 against limit of Rs. 6,49,74,000/-. Sh. Kamal Budhiraja recorded on the letter on Ex. PW-8/K2, mentioning from point B to B on the back side of the letter as "Party brought in Rs. 1.75 crore on 25.05.99. HO in their letter dated 06.05.99 has allowed disbursement on compliance of certain terms and conditions. The branch subsequently released loan on 14.05.99 and 21.05.99 which confirms to the fact that branch must have complied with stipulated terms and conditions. The only condition left over as per the noting of Sr. Manager Sh. Gupta on the letter of the party dated 21.05.99 is about promoter's contribution.
CBI v. Rajat Gupta & Ors. Page134 of 248 The CA Certificate dated 25.05.99 submitted by the party certifies fresh induction of capital of Rs. 1,75,00,000/- the total being 9.75 crore which exceeds 58 % stipulated contribution of the promoter (MC's cost $3691040 @ 43 = INR 158714720 = 58 % contribution comes to 9.21 crore). Looking to the pressing reasons given by the party, and as the part disbursement already allowed and as the document on sight basis and machineries reached India (Kuwait Airways delivery order dated 06.05.99) which will attract demurrage, to allow disbursement to the extent of balance amount against loan for machineries.
During cross-examination on behalf of A1, PW22 deposed that he was called only once in the beginning by the CBI. He sought permission from his office and went to the CBI office only once. His statement was also recorded by the CBI.
He admitted that A3 was relieved from the office on 13.05.99 to join Regional authority at Kolkata on promotion in the Assistant General Manager scale. He deposed that he had made a correct statement to the CBI on the basis of documents shown to CBI v. Rajat Gupta & Ors. Page135 of 248 him. He had put his initial at point C on D-4 Ex. PW-8/C which is a sanction letter sent by them to the parties mentioning therein all the terms and conditions. The terms and conditions mentioned in the letter were also accepted by two directors of the company excepting A1, who has not accepted the terms and conditions on behalf of A4 on 16.12.98. He admitted that the letter of sanction is dated 01.12.98. That the above-said letter of acceptance by the parties, amounts to contract between the parties i.e. the Bank and party.
PW22 further deposed that sanction order Ex. PW-8/C was checked over by him with the terms and conditions mentioned therein under the order of the head office. He never dealt with the application of the company regarding sanction of the loan. There must be branch file in the bank regarding the letter having been received from the company for sanctioning of the loan. The proposal Ex. PW-12/1 was not prepared by him. The proposal was sent to the head office by Dy. General Manager Sh. G.L. Khandelwal whose signatures are there at point D. The proposal was approved by General Manager on 21.11.98. The order mentioning therein at the CBI v. Rajat Gupta & Ors. Page136 of 248 top of Ex. PW-12/B is as "approved as proposed since the company is providing two corporate guarantees having total net worth of Rs. 147 crore, tangible collateral taken to the extent of shares of Rs. 150 lacs" and the abovesaid endorsement is signed by the then General Manager with a date 21.11.98 after cutting from 20.11.98 and the General Manager was empowered to sanction loan to the said company. He admitted that the terms and conditions mentioning in Ex. PW-12/B can be changed by sanctioning authority only. He admitted that the copy of the sanctioned note No. HO/GM(ORI)-ES- 1200-98 dated 12.11.98 is enclosed. Further, a copy of this letter and copy of sanctioned note is sent separately to Scope Complex Branch for their advance information. He admitted that the terms and conditions mentioned in the above note would remain the same which is binding on both the parties. The note directs the Regional Office to ask the branch to disburse the facility on complying of the terms of sanction. After the relieving of A3, Mr. B.K. Gupta, the Sr. Manager immediately took over the charge as Head of the Branch and was dealing with the branch matters.
CBI v. Rajat Gupta & Ors. Page137 of 248 He further deposed that the terms and conditions laid down in Ex PW8/C at Sr. No. 15 under the heading other terms and conditions are "NOC and credit report in respect of the existing facilities from Union Bank of India to be obtained before release of facilities. Credit report from the bankers of associate concerns are also to be obtained before release of funds. These were the conditions which were to be complied with in so far as the NOC from a bank is concerned.
PW22 deposed that there was no complaint filed by the bank against A4.
He admitted that when any firm/company through its proprietor/director approaches the Bank for Fund based or Non Fund based credit, asked to submit his request in prescribed format and is also asked to submit financial statements i.e. Balance sheet, Profit and Loss Account (also Auditors report wherever applicable); Income-tax/wealth-tax/sales tax returns and/or orders for the last three years; Assets and Liabilities statements of the individual applicant proprietor/partners directors and guarantors; Credit CBI v. Rajat Gupta & Ors. Page138 of 248 Reports from the banks with whom the applicant is banking alongwith the Project Report.
The Zonal Office, who has processed the loan application, would demand, if anything else is required from the company to furnish. PW22 was not dealing with the above-said project as the proposal was more than Rs. 50 lacs. The proposal above Rs. 50 lacs was dealt by the Sr. Manager, Sh. B.K. Gupta of Scope Complex Branch.
He admitted that A3 remained the Chief Branch Manager only for the period during which A3 was posted in this Branch and thereafter another senior most officer in the branch was heading the branch.
He admitted that in the last para of page no. 31 of Ex PW12/1, "In view of the above and as discussed in the previous pages, the proposal is put for credit facilities vide point no. vi." and the recommendation Ex PW12/1 is signed by Chief Manager (Scope Branch) and initialed by Sr. Manager Sh. B. K. Gupta , Chief Manager (NIO), Assistant General Manager (NIO) and DGM.
CBI v. Rajat Gupta & Ors. Page139 of 248 PW22 further deposed that he made statement before the CBI on the documents shown to him by the IO of the case. The term loan account no. 3981 Ex. PW-19/8, was opened on 14.05.99 and the first entry in the account was on 14.05.99 and simultaneously in Ex. PW-19/9 which is the current account of the company, the same amount was credited. Then thereafter, a total amount of Rs. 39461106 was transferred to the foreign supplier of the machinery on 14.05.99. There is no entry in both the accounts i.e. Ex. PW-19/9 and Ex. PW-19/8 of the date 13.05.99.
PW22 admitted that the credit department is to obtain credit report from Union Bank of India and also to obtain from the bankers of associate concerned. As indicated in clause no. 15 of Ex. PW-8/C (D-4/11).
PW22 admitted that the Head Office letter dated 26.12.98 Ex. PW-17/1 is addressed to the DGM, North India Operation, Dena Bank. The above-said letter is written under the directions of HOC at the meeting held on 24.12.98.
PW22 further deposed that Ex. PW-11/D2 are the
CBI v. Rajat Gupta & Ors. Page140 of 248
extracts from the meeting of Head Office Committee held on 24.12.98. These minutes pertains to accounts of A4. It is mentioned in the said extract that Head Office directed to obtain the latest and updated information. PW22 admitted that the sanctioning authority is the only person who can add or subtract any condition in the sanction order by the competent authority. It is the duty of the branch to look into the sanctioned terms and conditions as approved by the competent authority in this case was the General Manager ORI - I. PW22 admitted that it is mentioned in the note Ex. PW- 8/K2 of Kamal Budhiraja, Chief Manager, SCOPE Complex Branch which states that the parties have brought more than their contribution which comes to 9.75 crores instead of stipulated Rs. 9.21 crores. Therefore, the company has contributed Rs. 54 lacs excess than required.
PW22 further deposed that Ex PW-14/7, is a letter dated 03.03.2000 written by the Branch Head to the DGM, Regional Authority Office, New Delhi regarding A4 and the same contains the CBI v. Rajat Gupta & Ors. Page141 of 248 value of collateral security at point A, having approx value of Rs. 319.62 lacs and Rs. 58 lacs and also states that the bank disbursed the term loan - outstanding amount Rs. 64974000/-. The Prime Security in this loan account was plant and machinery, the value of which was to be assessed by a competent person.
PW22 admitted that the interest paid to the tune of Rs. 15056010/- upto 30.09.2000 as per statement of term loan account no. 3981 of A4.
PW22 further deposed that head office letter dated 06.05.99 Ex. PW-11/21 addressed to the Regional Authority, Dena Bank, New Delhi. This is an approval letter which states regarding approval for disbursement of sanctioned term loan with the further compliance of terms and conditions of sanctioned loan which is enumerated in the letter itself from item 1 to 4.
PW22 admitted that in Ex PW16/D1, the name of A3 was not there. The above said complaint is against A4 and others. He admitted that his name is mentioned at Sl. No. 2 in the list of witnesses Ex PW16/D2.
CBI v. Rajat Gupta & Ors. Page142 of 248 During cross-examination on behalf of A2 and A3, PW22 deposed that he remained as Sr. Manager from 2002 to 2006 at Regional Office, Dena Bank, Delhi. Thereafter, he was transferred to Inspection Department, Head Office, Delhi.
PW22 was assigned the duty of advances upto Rs.50 lacs alongwith Liasoning Officer for mobilisation of institutional deposits. He denied the suggestion that he was designated as Credit Manager. PW22 admitted that in the branch the credit department was the separate department and Sh. B. K. Gupta, Sr. Managar was the Head of the Credit Department. Sh. B. K. Gupta was looking after the files of advances of above Rs.50 lacs. He did not remember that in the year 1998, A3 was empowered to grant sanction whether to the tune of Rs.1 crore or Rs. 2 crore. He denied the suggestion that he was aware that in the year 1998 Sr. Manager was empowered to sanction the limit upto Rs.1 crore and Chief Manager upto Rs.2 Crore. Sh. B. K. Gupta used to sit in a separate enclosures in the year 1998. The correspondence to the files of advances used to be done by the credit department exclusively.
CBI v. Rajat Gupta & Ors. Page143 of 248 PW22 further deposed that he was never called Sh. B. K. Gupta to discuss the file of A4. No document pertaining to this file was prepared in his presence. He knew A1 as he used to come in the Branch after sanctioning of limit by the Head Office. On specific question, PW22 deposed that he has seen the signatures of A1 on various documents in the official course of business.
PW22 did not know whether the party submitted the proposal for the sanctioning of limit of Rs.7 crore to the branch directly to the Regional Office. He never dealt with the process of sanctioning of limit of Rs.7 crore in the present case.
PW22 further deposed that he did not make a statement to the CBI on 28.03.2003 to the effect that he dealt with the file of A4 as Manager (Credit), Dena Bank, Scope Complex, Noida.
PW22 never came across the project report of the present advances. He cannot say when the project report was received in the office of DGM and marked to whom. He never read the said project report. He never dealt the present file with Mr. B. K. Gupta in the Credit Department. He denied the suggestion that he CBI v. Rajat Gupta & Ors. Page144 of 248 used to deal with the present file alongwith Mr. B. K. Gupta at the stage of the disbursement of the loan and earlier also as and when required.
PW22 further deposed that Mr. B. K. Gupta had dealt with the file after receiving the request of the party for the proposal. He admitted that the application is made on a prescribed format alongwith the financial statement i.e. balance sheet, profit and loss account, Auditor Report and other relevant documents and the same is scrutinized by the credit department. PW22 clarified that in the present case, this application and other relevant document must have been scrutinized by Mr. B. K. Gupta as the proposal was of more than Rs.50 lac.
PW22 admitted that in the present case since the proposal was of about Rs. 7 Crore as such the branch has limited role to play therefore, after collecting the documents from the party, the same were sent to Regional Office where the proposal was to be processed.
PW22 did not receive letter Ex PW14/3 nor he dealt with CBI v. Rajat Gupta & Ors. Page145 of 248 the same. He never dealt with the letter no. HO/ORI/3288/98 dated 26.12.1998.
The enquiries were made from him by the IO after showing certain documents. He only identify the signatures of bank officials on those documents since he did not deal with the file of A4 as the proposal was for above Rs.50 lacs.
PW22 further deposed that he had checked detailed terms and conditions of the said sanction of Head Office duly incorporated in the sanction letter of the branch. He had tallied the terms and conditions from Head Office sanction as per instructions of the Chief Manager.
PW22 denied the suggestion that there was no instruction from Chief Manager and in fact it was the duty of the Credit Department to deal with the file as per the procedure and accordingly, PW22 alongwith Mr. B. K. Gupta dealt with the file.
PW22 admitted that as per the sanction letter, the credit report was to be obtained from Union Bank of India, Calcutta before the release of the funds. He admitted that it was the duty of the CBI v. Rajat Gupta & Ors. Page146 of 248 Credit Department to seek the credit report from the Union Bank of India, Calcutta (Kolkata) or any other financial institution as per terms and conditions. The officials of the credit department used to deal with the files of advances with the consent of Chief Manager. PW22 further deposed that in the present case also if any document was submitted then it was placed before the Chief Manager who put his initial for his consent and then the said document was to dealt by the Sr. Manager. Then the Sr. Manager empowered to deal in any manner with the said document and is also responsible to verify the said document. If the Sr. Manager is satisfied then the said document shall be termed as a genuine document.
Mr. B. K. Gupta also did not ask him to write any letter to ascertain the status of UPFC.
PW22 did not know who submitted letter Ex PW2/A. He denied the suggestion that letters Ex PW2/A and Ex PW2/B were submitted in the credit department; the same were dealt by him and Mr. B. K. Gupta and later informed the Chief Manager that the terms and conditions of the sanction limit conveyed by Head Office has CBI v. Rajat Gupta & Ors. Page147 of 248 been complied by the parties.
PW22 further deposed that as per Ex PW8/X Chief Manager, A3 was on leave from 14.05.1999. Mr. B. K. Gupta has marked in his own hand-writing that A3 was on leave from 14.05.1999 to 19.05.1999.
PW22 denied the suggestion that after being relieved an employee cannot be termed as on leave and he deliberately giving evasive answer as Mr. B. K. Gupta deliberately and intentionally had marked in Ex PW8/X the Chief Manager was on leave from 14.05.1999 to 19.05.1999. He did not know about letter no. NIO/PER/1534/99 dated 13.05.1999. He denied the suggestion that this letter was received in the branch on 13.05.1999 itself, however the same was not placed before the Chief Manager deliberately or intentionally or that he alongwith Mr. B. K. Gupta hid the said letter from Chief Manager with ulterior motive.
PW22 further deposed that he never met Sh. P. K. Aggarwal with regard to the file of A4. Sh. Sumer Chand Jain was looking after the Department of Foreign Exchange. He never dealt CBI v. Rajat Gupta & Ors. Page148 of 248 with Mr. Sumer Chand Jain with regard to the file of A4.
PW22 admitted that Ex PW9/G is letter dated 12.05.1999 and this letter is request for remittance addressed to Chief Manager, Dena Bank, Scope Complex Branch, New Delhi. He admitted that Ex PW9/H bears the date 13.05.1999. Date 14.05.1999 is nowhere mentioned in Form A-1 except on the back page at point Y. He further admitted that the remittance would be made on the same day when the transaction is made in the account of the party. He further admitted that in the present case remittance and transaction was made on 14.05.1999 as mentioned at point Y on the back page of Form A-1 i.e. Ex PW9/H and that Ex PW8/J-3 is a cheque dated 14.05.1999 which was given by A4 for remittance of foreign exchange for 14.05.1999.
He admitted that as per Ex PW19/8, Rs.2 Crore was disbursed on 14.05.1999 as the same was credited in the party account and the total amount of Rs.394,61,106/- was debited to the parties account vide cheque no. 116648 dated 14.05.1999 towards the remittance.
CBI v. Rajat Gupta & Ors. Page149 of 248 PW22 further deposed that statement dated 26.04.2003 which runs in 7 pages, is Ex PW22/DB, is his statement recorded by the IO.
PW22 further deposed that stated in his statement Ex PW22/DB that from point A1 to A1 that as per request of A1 Rs. 2 crore of the Term Loan was credited in account no. 21387 of A4 vide debit credit vouchers dated 14.05.1999.
He admitted that the voucher was dealt by three officials of the bank. One official prepared it, other one checked it and third one signed it. Ex. PW-8/J10 was prepared by one clerk namely Mr. Juneja and the same was checked by Mr. B.K. Gupta, Sr. Manager. The officers who sign at the column of check by is supposed to check the disbursable amount. He denied the suggestion that the officer who signed at the check by column is supposed to check whether all the terms and conditions for the disbursement of the loan have been met or not.
PW22 admitted that as per the banking norms, the voucher is prepared on a particular day then the same is to be used CBI v. Rajat Gupta & Ors. Page150 of 248 on the same day otherwise next day the said voucher cannot be used. He never dealt with the voucher dated 13.05.99 which is Ex. PW-8/J10. Ex. PW-8/J11 also does not contain his signatures. Ex. PW-8/J10. and Ex. PW-8/J11 were prepared in the Credit Branch by the concerned official. Since, he has not dealt with the vouchers Ex. PW-8/J10 and Ex. PW-8/J11, as such, he was not aware whether any loan was disbursed on 14.05.99 on the basis of vouchers Ex. PW-8/J10 and Ex. PW-8/J11. PW22 was not aware whether any process note for disbursement of loan was prepared on 14.05.99 or not. Ex. PW-8/K2 is a letter which was marked to him by Chief Manager of the branch. According to this letter, PW22 was instructed to give the information regarding the disbursement of the term loan of this case. In Ex. PW-8/K2, Mr. Kamal Budhiraja has given his noting from point B to B. The process note Ex. PW-19/10, at point X, is in the handwriting of Sh. B.K. Gupta, Sr. Manager for the disbursement of the loan on 21.05.99. PW22 has not dealt with letter Ex. PW-19/10. He simply carried out the instructions given by the Acting Chief CBI v. Rajat Gupta & Ors. Page151 of 248 Manager, Sh. B.K. Gupta. Ex. PW-8/J8 i.e. the voucher dated 21.05.99, was prepared by one Clerk of Credit Department namely Juneja and he signed in the column Check by and the voucher was approved by Sh. B.K Gutpa, Acting Chief Manager.
On specific question, PW22 deposed that he was not supposed to check the compliance of the terms and conditions. It was only to check the voucher with the amount as per instructions of Acting Chief Manager Sh. B.K. Gupta.
The voucher dated 26.05.99, Ex. PW-8/J12 and Ex. PW- 8/J13 were also signed by him in the column Check by. He has not made any overwriting in Ex. PW-8/J13 at point X. He did not know as to who had made it. PW22 volunteered that on 26.05.99, Sh. Kamal Budhiraja was the acting Chief Manager.
He denied the suggestion that he was in connivance of Mr. B.K. Gupta for the disbursement of the loan on 14.05.99 and thereafter.
CBI v. Rajat Gupta & Ors. Page152 of 248 42 PW23 deposed that he was posted as Sr. Manager (Asset
Recovery Management Branch) of Dena Bank, Rajendra Place, New Delhi. He had asked Mr. Hardeep Singh, Insp. CBI that as the correspondence folder (Two Volume) of the file Aviquipo India Ltd. & Ors. have been received by them vide letter No. Nil dated 19.05.03. PW22 further deposed that a correspondence pertaining to the case will also be required for proving the recovery case filed by them in DRT Delhi and requested him to provide photocopies of these two files duly certified by the office for record.
He proved that Ex PW23/A is a letter dated 26.05.03 bearing reference No. DB/ARB/Aviquipo/013/03 addressed to Hardeep Singh Insp. CBI from him which bears signatures of PW23 at point A. PW23 identified Ex. PW-8/F and Ex. PW-8/G. During cross-examination on behalf of A1, PW23 deposed that he had not done anything regarding the recovery of the amount except filing of recovery application in DRT. The loan account alongwith underlying assets has been sold to Asset CBI v. Rajat Gupta & Ors. Page153 of 248 Reconstruction company of India Ltd. in the year 2007 during his tenure as Chief Manager Legal at Head Office and thereafter Asset Reconstruction Company of India Ltd. (ARCIL) was dealing with this account for recovery of the dues at DRT or other Legal Forum, if any. There was duly assignment deed executed between the Bank and ARCIL, as the bank has already recovered the sale consideration of the assignment of this account from ARCIL. After receipt of sale consideration of assignment of non-asset of Aviquipo of India Ltd. the recovery of amount, if any, is looked after by ARCIL. There is nothing which is left for recovery between the bank and A4 During cross-examination on behalf of A2 and A3, PW23 deposed that he did not remember since when he was dealing with the file of A4 before 26.05.03. He admitted that he had not seen Ex PW8/F and Ex PW8/G during his tenure while posting in the Recovery Branch, Dena Bank.
Upon specific question, PW23 replied that the Inspector of CBI had written a letter dated 19.05.03 on the basis of that letter, he had asked for photocopies of the correspondence to enable him CBI v. Rajat Gupta & Ors. Page154 of 248 to decide which correspondence will be crucial for proving my case in the DRT.
He was dealing with all the cases of ARB pertaining to A4.
Upon specific question, PW23 deposed that the destruction of record, if any, is carried out as per policies of the bank. The head office frames the policy for destruction of records.
He admitted that he could not identify Ex. PW-8/F and Ex. PW-8/G as he had never seen these two volumes either in original or their photocopies.
43 PW24 deposed that during the year 1996 to May, 1999, he was working as Deputy General Manager, North India Operations, New Delhi. His major duties include, supervision and monitoring of the performance and to achieve the goals given by Corporate Office, the deposit portfolio, credit portfolio were his major responsibilities. In credit portfolio the proposals received from the branches are being monitored and processed at the credit CBI v. Rajat Gupta & Ors. Page155 of 248 department level and the proposals which were under his powers were put to him for sanction and which were not within the power are processed and submitted to corporate office for sanction. By process, he mean to arrive at a conclusion whether the proposal is technically feasible and economically viable and the various credit datas the same were considered. He further deposed that he has dealt with file Ex PW8/F which pertains to A4. The proposal which comes to regional office for process initially is first scrutinized and discussed at the branch level and after its recommendation the same put up to regional office for consideration.
PW24 further deposed that at regional office, the credit department looks after all the financial data and technically and economically feasibility and put up to the Regional Manager for consideration. The Regional Manager after satisfaction send the proposals to Head Office for consideration which are not within his authority. The document Ex PW11/1 bearing his signatures encircled at point A. Vide this letter, after going through the proposal whatever the deficiencies were observed, the same were CBI v. Rajat Gupta & Ors. Page156 of 248 communicated to the Chief Manager for the comments and also submit the proper reply after discussing with the party. Based on the queries, the reply was received from Sabra Impex Ltd. and same is already Ex PW11/2. Letter dated 17.06.1998 addressed to the Chief Manager, Dena Bank. The same is already Ex PW11/6 and bears his signatures at point A. Reply to the letter dated 17.04.1998 is already Ex PW11/7. The reply was sent by the Chief Manager of Scope Complex Branch, Dena Bank. Letter dated 04.04.1998 addressed to Deputy General Manager (NIO). The same was sent by the Chief Manager and is already Ex PW11/4. Letter dated 30.03.1998 addressed to Chief Manager, Dena Bank sent by him is already Ex PW11/3. Letter dated 19.06.1998 which was addressed to Asstt. General Manager, Dena Bank, Industrial Finance Branch, Karol Bagh, Delhi. The said letter was with regard to the reference of Industrial Finance Branch is Ex PW24/1. Letter dated 17.04.1998 is already Ex PW12/3 was addressed to Chief Manager, Dena Bank. Letter dated 24.03.1998 addressed to Deputy General Manager, Dena Bank which was received in his office from Corporate Office, CBI v. Rajat Gupta & Ors. Page157 of 248 Mumbai is Ex PW24/2.
PW24 further deposed that for sanctioning of loan, NOC is taken from various banks to whom the company had taken the earlier loan. The photocopy of No Objection Certificate, on the letter head of UPFC in which it has been reported by Sh. S. K. Pasari that they do not have any charge on the asset of new factory which will be under the first charge of Dena Bank. The said letter is already Ex PW2/A. It is mandatory to obtain the letter in original. He further deposed that Mark PW11/24 is letter which was addressed to him i.e. Deputy GM, Dena Bank by Deputy General Manager, Corporate Office, Industrial Finance Branch, Mumbai on pledge of shares as collateral security. The same is Ex PW24/3. Letter already Ex PW11/15 which was addressed to him from General Manager, Dena Bank, North India Operations, Mumbai. Letter dated 17.03.1998 addressed to him by Chief Manager, Dena Bank, Corporate Office, Mumbai and he has dealt with this letter which is Ex PW24/4.
During cross-examination on behalf of A1, PW24 deposed that he never called by CBI in this case but CBI officials CBI v. Rajat Gupta & Ors. Page158 of 248 came to his office for the purpose of investigation. PW24 admitted that D-25 is the file of Scope Complex Branch. He admitted that file pertaining to his office would remain in his office but it can be sent outside the office with the permission of the competent authority. He admitted that whenever permitted sent out from my office then the receipt should be obtained. He admitted that minutes prepared of the meetings convened for the said committee and that Ex PW11/D- 2 is noting of the minutes of the Head Office Committee.
During cross-examination on behalf of A2 and A3, PW24 admitted that the branch had requested to process the proposal of A4. He further clarified that thereafter the process at regional office, the file was sent to the branch for comments. PW24 admitted that if the Chief Manager wanted to process the proposal at their end, the same could have been done in the branch as per banking procedure. PW24 volunteered that in this case the branch Manager alongwith the client visited the regional office and had a detailed interaction with the credit department which was headed by him and thereafter he requested that it is better to process at regional office.
CBI v. Rajat Gupta & Ors. Page159 of 248 PW24 admitted that there is a team of expert at regional office to process the loan proposal and in the present case the same was done by the credit department at regional office. The credit department at the regional office could have rejected the proposal after the process if the same was not viable. PW24 admitted that after the satisfaction of the viability of the proposal for grant of sanction, the proposal was recommended to the Head Office. He further admitted that the proposal was again processed at the Head Office and after satisfaction of the viability of the proposal was considered.
PW24 admitted that all the conditions which were to be complied before the disbursement of the loan are incorporated in the sanctioned proposal which is conveyed to the Branch and thereafter to the party and that Scope Branch was a big branch having a separate Credit Department. It is also admitted that the correspondence used to be done with the Head of the Credit Department of the Branch.
PW24 admitted that at that time of process of the CBI v. Rajat Gupta & Ors. Page160 of 248 proposal at the regional office, whenever necessity arises, the party was called alongwith the Branch Head directly in the Regional Office. He denied the suggestion that the Chief Manager was never called by the Credit Department of Regional Office and they used to deal with the party independently without the interference of the Branch Chief Manager. He clarified that whenever there was necessity the party might have been called directly, however, he was not aware how many times the party was called.
PW24 further deposed that in case of any amendment in the terms of sanction, it is initially discussed in the Branch thereafter the terms are conveyed to the Regional Office and from there for approval to the Sanctioning Authority. There was an amendment of the guarantors in the present case.
44 PW25 deposed that in the present case questioned and specimen documents were received in CFSL on 27.03.2003 vide letter no. 1337/RC/BD1/2002/E/0002 and more documents were received on 13.05.2003, 22.05.2003, 03.06.2003 vide letters no.
CBI v. Rajat Gupta & Ors. Page161 of 248 2219, 2369, 2519 respectively from Senior Superintendent Police, CBI, BS & FC New Delhi.
Ex25/A is a letter dated 27.03.2003 alongwith annexures addressed to Director, CFSL running into four sheets.
Ex25/B is a letter dated 13.05.2003 addressed to Director, CFSL.
Ex PW25/C is a letter dated 22.05.2003 addressed to Director, CFSL running into two sheets.
Ex.25/D is a letter dated 03.06.2003 alongwith annexures addressed to Director, CFSL running into five sheets.
He carefully and throughly examined all the documents with various required scientific equipments and on the basis of handwriting and documentary evidence he had prepared his report bearing no. CFSL-2003/D-0167 dated 29.04.2003 which bears his signatures on all the three pages at point A which is Ex. PW25/E running into three pages (colly three pages). In this report, he had given seven opinions alongwith their reasons. The same was forwarded to SSP, CBI vide CFSL forwarding letter dated 05.05.2003 CBI v. Rajat Gupta & Ors. Page162 of 248 bearing no. CFS:-2003/D-0167/2482 which bears the signature of Dr. S.R Singh the then director CFSL. He identified his signature as he worked with him in CFSL and seen him writing and signing. The same is Ex. PW25/F. PW25 deposed that he had prepared and submitted a supplementary report bearing no. CFSL-2003/D-0276, CFSL- 2003/D-0294 and CFSL-2003/D-0319 dated 18.06.2003 Ex PW25/G which runs into five pages bearing his signatures at point A on all the five pages.
In his report Ex PW25/H, PW25 had given five opinions alongwith reasons. The report was forwarded to SSP CBI BS & FC vide forwarding letter bearing no. CFSL-2003/D-0276, CFSL- 2003/D-0294 and CFSL-2003/D-0319 dated 18.06.2003 which is signed by Sh. T.R. Nehra for Director CFSL.
The documents examined by PW25 in this case are as follows:
1. Q1 to Q3, Q5 & Q6 are on Ex. PW2/A.
2. Q4 is on Ex. PW8/D. CBI v. Rajat Gupta & Ors. Page163 of 248
3. Q7 is on EX. PW2/B.
4. Q8 & Q9 is EX. PW25/J.
5. Q10 is on Ex. PW3/A.
6. Q11 is on page 4 of letter Ex. PW3/A.
7. Q12 to Q16 are on Ex. PW8/J-2 to Ex. PW8/J-6.
8. Q17 is on Ex. PW8/J-1.
9. Q18 is on back side of D-30/2 Ex. PW8/J-1.
10. Q19 & Q20 are Ex. PW25/K.
11. Q21 is on 2 page of Ex. PW8/K-2.
12. Q22 (D-63) is Ex. PW25/L. PW25 deposed that he also examined the following documents:
1. Q23 (Part of D-63, page-17) is Ex.PW25/M.
2. Q24 (Part of D-63, page-15) is Ex.PW25/N.
3. Q25 (Part of D-63, page-14) is Ex.PW25/P.
4. Q26 (Part of D-63, page-13) is Ex.PW25/Q.
5. Q27 (Part of D-28, page-114) is Ex.PW25/R.
6. Q28 (Part of D-28, page-111) is Ex.PW25/S. CBI v. Rajat Gupta & Ors. Page164 of 248
7. Q29 (Part of D-28, page-102) is Ex.PW25/T.
8. Q30 (Part of D-26, page-125) is Ex.PW19/1.
9. Q31 (Part of D-26, page-119) is Ex.PW25/U.
10. Q32 (Part of D-36, page-21) is Ex.PW9/C.
11. Q33, Q34, Q35 (Part of D-36, page-20 both sides) is Ex.PW9/D (lower corner of the paper bearing Q34 is partly torn and missing).
12. Q36 (Part of D-36, page-32) is Ex.PW9/G.
13. Q37 and Q38 (Part of D-36, page-36 both sides) is Ex.PW9/H.
14. Q39 (Part of D-36, page-39) is Ex.PW9/J.
15. Q40 and Q41 (Part of D-36, page-40 both sides) is Ex.PW9/K.
16. Q42 (Part of D-36, page-45) is Ex.PW9/L.
17. Q43, Q44 and Q45 (Part of D-36, page-46 both sides) is Ex.PW9/M.
18. Q46 and Q47 (Part of D-36, page-51 both sides) is Ex.PW9/P. CBI v. Rajat Gupta & Ors. Page165 of 248
19. Q48 (Part of D-63, page-25) is Ex.PW25/V.
20. Q49 and Q50 (Part of D-63, page-24) is Ex.PW25/W. Ex PW18/3 (colly) (S-1 to S-73) is the signature and writing of A1; Ex PW18/4 (colly) (S-74 to S-106, S-106A, S-107 to S-
112) is the signature and writing of A2; Ex PW25/X (S-113 to S-130) is the signature and writing of Sh. S. K. Pasari; Ex PW25/Y (S-131 to S-142) is the signature and writing of A3; Ex PW25/Z (S-143 to S-
158) is the signature and writing of Sh. Praveen Kumar; Ex PW25/Z- 1 (S-159 to S-173) is the signature and writing of Sh. Vimal Kumar; Ex.PW25/Z-2 (colly from S-174 to S-188) is the signature and writing of Sh. Sanjay Gupta; Ex.PW25/Z-3 (colly from S-189 to S-206) is the signature and writing of Sh. Samir Gupta; Ex.PW25/Z-4 (colly from S-207 to S-252) is the signature and writing of Sh. Gian Chand Verma; Ex.PW3/B-1 to Ex.PW3/B-11 (S-253 to S-263) is the signature and writing of Ms. Rekha Paswan which was examined by him.
All the above mentioned questioned and specimen documents examined by PW25 bear rubber seal impression of CBI v. Rajat Gupta & Ors. Page166 of 248 CFSL. The opinion given by him are based on the scientific examination of the original documents and no photographs were taken. He had not prepared any photographs in this case as the same is not required for his examination. He deposed that he has based his examination directly on the instrument under zooming conditions. The opinion given by him in this case is correct and based on scientific evidence and he had incorporated detailed reasons in his reports and deposition.
During cross-examination on behalf of A1, PW25 admitted that he had asked more specimen signatures of A2 and Sh. S. K. Pasari alongwith handwriting having similar text as appearing in Q5 and Q6 as there were number of similarities between Q1 and S74 to S93 but all the characteristics were not matching and to arrive to correct opinion more specimen writings of A2 were required.
PW25 denied the suggestion that case was allotted to him or in order to get favour from CBI, he had given the favorable opinion to CBI as there was a case pending against him and the CBI CBI v. Rajat Gupta & Ors. Page167 of 248 were enquiring about his character and giving opinion in favour of the parties.
During cross-examination on behalf of A2 and A3, PW25 admitted that the specimen hand-writings which were examined, were not taken in his presence.
He admitted that he had mentioned Ex.PW25/G under the heading of result of examination in the first line of para 1 'the questioned English signature is the xerox copy of the original signature'. The xerox copy of original signature is Q1 and the document is Ex.PW2/A .
On specific question PW25 deposed that his microscopic observation mentioned in his report is correct and does not require any evidence. However his observations is material itself to substantiate his opinion.
On specific question, PW25 deposed that handwriting examination is matter of observation and comparison and line quality of the signatures examined under microscope and same procedure was followed by him. He had given detailed reasons in CBI v. Rajat Gupta & Ors. Page168 of 248 his report in support of his observations.
PW25 admitted that he has based his opinion Ex.PW25/G on the fact that the questioned document Q1 was attested as certified true copy along with signature of director of A4 to compare the xerox copy signature with specimen signatures.
PW25 deposed that he examined Ex.PW25/J to compare Q9 with the specimen signatures i.e. S74 to S93 and S207 to 221. He admitted that he had mentioned in his report Ex.PW25/G in under the heading of para II 'the line quality of questioned signature show discontinuity'.
45 PW26 deposed that in the year 2002, he was posted as DSP, BS&FC, CBI New Delhi. PW26 identified and deposed about documents which have already been exhibited by other witnesses. He further endorsed FIR No. RC/BD1/2002/E/0002 dated 17.06.2002 by Sh. A.K. Malhotra, the then SP CBI BS&FC, CBI New Delhi and is Ex. PW-26/1 (Colly three sheets) bearing signatures of Sh. A.K. Malhotra at point A on all the three sheets. The FIR was CBI v. Rajat Gupta & Ors. Page169 of 248 marked to him for the purpose of investigation.
Ex PW26/2 is letter no. 3927, RC 2(E)/2002- CBI/BS&FC/DLI dated 12.09.02 addressed to Regional Manager, UPFC Noida from him, asking for certain clarification, regarding issuance of document as mentioned in letter from I to V which bears signatures of PW26 alongwith official seal at point A. Ex PW26/3 is letter dated 24.07.1998 vide reference no. NSIC:RON/MKG:18:98-99 (D-63, Vol. I) sent by registered AD/by hand issued by Sh. A. K. S. Rathore, Regional General Manager of National Small Industries Ltd. It is addressed to Assistant General Manager, UP Financial Corporation on the address mentioned above. Sh. Rathore vide this letter has wanted to know the exact position of loan repayment of A4.
Ex PW26/4 (D-63, Vol.2) is letter dated 22.09.1999 vide reference no. 3819/FC/REC/Noida/99-2000 issued by Sr. Manager (Law) with regard to account of A4 intimating that letter no. 1802 dated 05.07.1999 was issued by the office of Sr. Manager (Law), UP Financial Corporation.
CBI v. Rajat Gupta & Ors. Page170 of 248 Ex PW26/5 is letter dated 17.09.1999 issued by Dena Bank addressed to Regional Manager, UPFC enclosing therewith the copy of letters mentioned in the letter dated 05.07.199, 11.05.1999 & 05.05.1999 seized by him.
During investigation PW26 had recorded the statement of Sh. P. Ramanujam, Sh. S. R. Bansal, Sh. J. Rajinder Prasad, Sh. Basant Kumar Gupta, Sh. Ramesh Kukreja at two occasions, Sh. S. K. Pasari, Sh. A. K. Srivastava and Smt. Sushma Kochar. These statements were recorded correctly as per their version and it bears his signature which is at point A. During cross-examination on behalf of A1, investigation was entrusted to him on 17.06.2002. It was registered on the basis of source information.
PW26 further deposed that he was not informed by any bank official during their examination that the bank lodged a complaint anywhere against the company i.e. M/s Aviquipo of India (A4). He had seized the documents pertaining to this case from the custodian of the documents.
CBI v. Rajat Gupta & Ors. Page171 of 248 He admitted that he had recorded the statement of witnesses after showing the relevant records and some times they stated of their own. Witness had verified the statement during the course of investigation. The application of the company was processed in the branch, regional office and head office Dena Bank. The loan was sanctioned by the General Manager, Head Office, Dena Bank at Mumbai. The sanctioned order / letter was communicated to the regional office and in turn to the branch for further processing and disbursing the loan as per the terms and conditions of the sanctioned order. He deposed that the sanctioned order was dated 01.12.1998. The sanctioned order was accepted by A4 on 16.12.1998. The conditions mentioned in Ex.PW8/C binding on both the parties to comply with. All the conditions are supposed to be comply by the company and it was incumbent upon the branch to ensure that the conditions are complied with. As per the condition no.15 of other terms and conditions, NOC and credit report in respect of existing facilities from Union Bank of India was to be obtained before the release of the facilities. The authority who CBI v. Rajat Gupta & Ors. Page172 of 248 had sanctioned the loan, could add additional conditions to be complied with before disbursement of loan, on the basis of certain discussion with the concerned bank officials. As per the bank procedure, the additional conditions were to be intimated to the company as per the original terms and conditions of the loan, the company has to communicate its consent. He admitted that he had collected D-6 & D-7 from the bank official which was placed in the file and same are relied upon document.
The document Ex.PW11/D2 is communicating the extracts of the minutes of the meeting of head office committee of Dena Bank dated 24.12.1998, ''that latest and updated information be obtained'' in respect of credit proposal sanctioned by GM (ORI- I) : LOANS-3. PW26 admitted that the statement of Sh. J. Rajender Prasad, it is reflected that a valuation report dated 21.03.2002 was obtained from Gyan Chand & Associate which valued the plant and machinery. He further admitted that that he had recorded the statement of Sh. J. Rajender Prasad on 25.02.2003.
During cross-examination on behalf of A-2 & A-3, PW26 CBI v. Rajat Gupta & Ors. Page173 of 248 deposed that when the investigation was entrusted to him the FIR had already been registered. He could not recollect as to how many time he visited scope complex branch of Dena Bank in the year 2002 after the entrustment of investigation. He admitted that during the course of the investigation, it had come on record that Sh. B. K. Gupta was working as Credit Manager of Scope Complex branch of Dena Bank. The process of advancing of loan is done at the branch level, regional office and head office. He had visited the factory complex of A4.
He denied the suggestion that he had made the enquiries from the officials of A4 or during the course of enquiry/investigation, it was found that A2 was not connected in any manner with A4 or any of its associate concerned.
During the course of investigation PW26 came to know that A3, the then Chief Manager, Dena Bank relinquished charge on 13.05.1999. The fact of promotion of A-3 had not come into his knowledge. He denied the suggestion that he had come to know during the course of investigation that A-3 was promoted on CBI v. Rajat Gupta & Ors. Page174 of 248 05.05.1999.
He denied the suggestion that B. K. Gupta was over all in-charge of Credit Department of Scope Complex branch of Dena Bank.
It is admitted that seizure memo of letter no.
263/FC/REC/Noida-99-2000 dated 11.05.1999 issued to M/s Aviquipo of India Ltd. (A4) from S.K. Pasari regarding no objection, it mentioned in the seizure memo that photocopy of this letter was seized and that photocopy of letter regarding one time settlement dated 05.05.1999 was seized.
PW26 further deposed that Ex. PW-8/J10 and Ex. PW- 8/J11 reflect that term loan was sanctioned as per AGM Scope Complex on clients request letter dated 12.05.99 and the said term loan was disbursed on date apparently on 13.05.99 but it appears to him that there has been some alteration on the date 13 at point A. PW26 denied the suggestion that the first term loan was disbursed on 14.05.99 or that as per the case of the prosecution also the first term loan was disbursed on 14.05.99.
CBI v. Rajat Gupta & Ors. Page175 of 248 PW26 admitted that during the course of investigation, he had come across to the fact that three officials are involved in preparing the voucher i.e. one official made the voucher and the same was checked by the other one and finally the same was approved by the Branch Manager.
PW26 admitted that as per document Ex. PW-8/J-8 and Ex. PW-8/J-9, the second term loan was disbursed as per instruction from acting chief Manager on parties request on 21.05.99. He denied the suggestion that he was well aware about the fact that Sh. B. K. Gupta was working as acting Chief Manager on 21.05.99 or he deliberately avoiding to accept the same. He admitted that during the course of investigation he came to know that debit and credit vouchers should be used on the very same day when they are prepared and the same cannot be used next day as per Banking Rules.
He denied the suggestion that he came across the fact during the course of investigation that the voucher dated 13.05.99 i.e. Ex. PW-8/J-10 and Ex. PW-8/J-11 were illegally used on CBI v. Rajat Gupta & Ors. Page176 of 248 14.05.99 by Sh. B.K. Gupta.
He denied the suggestion that during the course of investigation, he had come to know that A3 did not have any role in the disbursement of the first term loan or the same was disbursed by B.K. Gupta. He denied the suggestion that there was no evidence on record against A2 or that he not collect the admitted handwriting of A2 deliberately and intentionally.
46 PW27 deposed that he was posted as Sr. Manager (Technical) in recovery department in UPFC at Noida in the year 1998. He had dealt with recoveries of dues of UPFC, Noida and also dealt the recovery of dues against A4.
PW27 proved Ex PW27/1 which is a seizure memo dated 26.05.2003 by which he had handed over, "original recovery file in respect of A4 M/s Aviquipo of India Ltd. in two volumes. Volume-I contains 5 pages of note sheet and 167 pages of correspondence. Volume-II contains only 169 pages of correspondence and no note sheets" to Hardeep Singh, the then CBI v. Rajat Gupta & Ors. Page177 of 248 Inspector of Police, SPE/CBI/BS&FC. It bears signature of PW27 at point A and also bears signature of Hardeep Singh at point B in his presence; Ex PW27/2 which is a file containing 5 pages of note sheet and 167 pages of correspondence. The same was handed over to Hardeep Singh by him through seizure memo Ex.PW27/1. Ex PW27/3 which is a file containing 169 pages of correspondence. The same was handed over to Hardeep Singh by PW27 through seizure memo Ex.PW27/1; Ex PW27/4 which is a loan ledger of UPFC already marked as PW6/X. The same was dealt by him during the official course of duties; Ex PW27/5 is a loan ledger of UPFC already marked as PW6/Y (colly 11 sheets). The same was dealt by him during the official course of duties; Ex PW27/6 which is a loan ledger of UPFC already marked as PW6/Z (colly 4 sheets). The same was dealt by him during the official course of duties.
PW27 deposed that Aviquipo of India Ltd. (A4) was sanctioned three loans by UPFC i.e.
1. Term Loan of 40.70 Lacs sanctioned on 02.09.1994 out which 40.26 Lacs were disbursed, CBI v. Rajat Gupta & Ors. Page178 of 248
2. Working Capital Loan of Rs. 40 lacs, date of issue of sanctioned advise out of which 25 lacs were disbursed.
3. Additional Terms Loan of Rs. 10 lacs sanctioned on 31.03.1997.
PW27 further deposed that after analyzing the proposal his office vide Ex.PW27/6 sent reply to A4. It bears signature of PW27 at point 'A'. The reply to NSIC bearing his signature at point 'A' is Ex.PW27/7. Vide Ex.PW27/8 reply was sent to A4. It bears initial of PW27 at point 'A' in token of preparation of said letter. Vide letter exhibited as Ex.PW27/9, A-1 submitted another proposal after received of fax. This proposal was also marked for further action vide Ex.PW27/10 running into 5 page. A-1 submitted proposal for OTS (One Time Settlement) for their unit at C-82/B, Sector -8, Noida, U.P. This proposal was rejected vide letter dated 06.05.1999 already Ex.PW5/C bearing his signature at point 'B'. Vide letter Ex.PW27/11 bearing his signature at point 'A', Union Bank of India was informed regarding account of A4 turning NPA (Non Performing Asset). Vide letter dated 05.07.1999 is Ex.PW27/12, Dena Bank CBI v. Rajat Gupta & Ors. Page179 of 248 was also informed regarding account of A4 NPA. Vide letter dated 08.07.1999 A4 was reminded regarding settlement of dues of corporation. The same is Ex.PW27/13 and bears signature of PW27 at point 'A'. Vide Ex. PW 27/14, he had handed over documents mentioned in the receipt memo to the IO Sh. Hardeep Singh. The receipt memo bears his signatures at point 'A'.
During cross-examination on behalf of A1, PW27 deposed that he had dealt the matter at recovery stage and that the entire record was received by him through official channel only. PW26 admitted that he had handed over the files vide seizure memo Ex. PW 27/1.
PW27 deposed that during the recovery meetings they came to know regarding the fact A4 that company is also banking with Dena Bank. The file came to him when the recovery process was initiated. He admitted that the proposal for the payment of outstanding amount was submitted by the company and the same was scrutinized. He denied the suggestion that he did not deal with the files of A4 or that the files were handed over by the legal CBI v. Rajat Gupta & Ors. Page180 of 248 department of his office and not by him or that he had not joined the investigation at any point of time pertaining to this case or that there was no correspondence with Dena Bank with regard to the account of A4.
On specific question, PW27 deposed that in this case, the recovery action was taken at the time when the fraud came to the knowledge of the Department and therefore, the matter was referred to Legal Section.
PW27 further deposed that first, he was informed verbally by the Area Officer that the property which is to be mortgaged to the department, was mortgaged to NSIC and thereafter, after correspondence with NSIC, they confirmed the same.
Testimony of PW2, remained unchallenged on behalf of A2 and A3.
47 PW28 deposed that he was working as Inspector in BS & FC, New Delhi in the year 2003. Investigation of case RC 2 CBI v. Rajat Gupta & Ors. Page181 of 248 (E)/2002 was transferred to him from Sh. O. P. Parida, the then Dy. SP in the month of April, 2003. During the course of investigation, PW28 collected documents from officers of Dena Bank, UPFC, NSIC and examined connected officials of these officers. He also recorded statement under Section 161 CrPC of witnesses.
PW28 deposed about documents which were already proved by earlier witnesses.
PW28 further proved application Ex PW28/1 (alongwith the envelope) and the orders passed by the Court are on the application.
PW28 further proved Ex PW28/2 which is a receiving letter dated 19.05.2003 through which PW28 received the correspondence folder (2 volumes) of SCOPE complex Branch pertaining to Loan account of Aviquipo of India Ltd. through Sh. Anil Kumar Special Messenger. It bears signatures of PW28 at point A and also bears the signatures of Sh. Anil Kumar at point B. PW28 deposed that after completion of the investigation, recorded the statements of the witnesses under section 161 Cr.P.C.
CBI v. Rajat Gupta & Ors. Page182 of 248 and collected/seized the relied upon documents, he had filed charge sheet on 28.06.2003. It bears signatures of PW28 at points A and signatures of A. K. Malhotra, SSP CBI, BS & FC, New Delhi at point B and the same is now Ex.PW28/3 (colly. 18 sheets).
During cross-examination on behalf of A1, PW28 deposed that he filed the charge sheet in the present case in June 2003 itself. Almost three months the investigation of the present case remained with him and he had recorded the statements of the witnesses and went through all the file and records of the present case. The charge sheet was prepared in his period. He denied the suggestion that he was asked to sign the charge sheet only in mechanical manner only on the asking of SP or that only because of this reason there is no order of transfer of investigation is on court file. He saw whole record of the bank concerned to this case and as well as of the UPFC and NSIC and all the record of the present case during course of investigation.
PW28 deposed that prior to FIR of this case, there was an another criminal complaint filed by the bank in the court. He did CBI v. Rajat Gupta & Ors. Page183 of 248 not mention the facts of criminal complaint in the charge sheet. There is also no mention of the criminal complaint in the FIR filed by CBI. He did not collect the record of the criminal complaint filed by the bank. He came to know about this fact when the charge sheet was filed in the present case in the court. He came to know about the criminal complaint from the defence lawyer. He knew that there is an order of the court to get the case records of the criminal complaint filed by the bank to the present court. He denied the suggestion that the order specifically directed to the CBI to have the case file transferred from the court of Metropolitan Magistrate to the present court or that he blindly signed the abovesaid charge sheet on the asking of seniors.
PW28 admitted that this file was seized from Sh. D. K. Saxena, Senior Manager, Technical, UPFC, Noida. He denied the suggestion that he was aware that the investigation was started by CBI in October 2001 or that the investigation in the present case was started in January 2001 or that he had not gone through the whole record that is why he intentionally avoiding the investigation CBI v. Rajat Gupta & Ors. Page184 of 248 already started by CBI. He was not handed over any record regarding abovesaid facts of the investigation started in the earlier period of 2001 by the CBI.
Upon specific question, PW28 deposed that the loan was sanctioned by General Manager ORI-I and finally approved by head office committee of the bank which was final authority in the matter.
PW28 deposed that the bank officers at the level of regional office and branch were not competent to approve the loan. They simply made proposal and sent it to the head office of the bank.
He admitted that the loan which was recommended by the regional office was ultimately sanctioned by General Manager ORI-I and finally approved by head office committee of the bank. The loans sanctioned by the General Manager finally approved by the head office committee of the bank. The head office committee not only monitored the loan account but also at the time of approval of the sanctioned loan, imposed further conditions which were CBI v. Rajat Gupta & Ors. Page185 of 248 conveyed to the branch through regional office.
PW28 admitted that Ex.PW11/D2 is the extracts from the minutes of the meeting of the head office committee held on 24.12.1998.
PW28 further deposed that he has not investigated the fact that A1 was the professional Director on salary basis, without having any shares in A4.
PW28 further deposed that Ex.PW8/C is a sanctioned letter from the bank to A4 detailing the terms and conditions to be followed by the borrower/applicant. The terms and conditions mentioned in the above said letter were to be got complied by the branch from the borrower and self.
He admitted that paras no.4 and 5 of chargesheet Ex. PW28/3 filed by him are correct. He further deposed that the entire chargesheet is correct. He denied the suggestion that no document has been filed with charge sheet regarding the sanction of the terms loan having been accorded by the head office committee of Dena Bank. He denied the suggestion that there is any sanction of HOC CBI v. Rajat Gupta & Ors. Page186 of 248 committee accorded in the sanction of the above said loan which was sanctioned by the General Manager under his discretionary power.
One Mr. D. K. Saxena of UPFC had denied receipt of any such draft from A4. There was no occasion for him to check it out from the bank from where the bank draft was got issued by the borrower company.
He denied the suggestion that he purposely did not take into possession the criminal complaint filed by the bank in court as it would have gone against this case or that he had seen the complaint filed by the bank or that he is hiding the knowledge of the criminal complaint filed by the bank in the present case as the contents thereof are contrary to the case mentioned in the charge sheet.
PW28 admitted that the charge sheet which is Ex. PW- 28/3 does not find any mention that the original of Ex.PW2/A and Ex. PW2/B (D-6 and D-7) are in possession of A-1. He admitted that the witnesses stated before him that the amount of Rs. 2 crores of CBI v. Rajat Gupta & Ors. Page187 of 248 the term loan was credited to the current account of the borrower vide debit credit vouchers dated 14.05.99. He denied the suggestion that the whole investigation is based on the dictation of his senior officers of the CBI and other interested persons.
During cross-examination on behalf of A2 and A3, PW28 deposed that the investigation was handed over to him in the month of April, 2003. The document Ex.PW14/1 was seized from one Sh. C. P. Singh, the said document was brought from the Head office of Dena Bank, Mumbai. Document Ex.PW12/1 was seized from Sh. C. P. Singh. He admitted that document which is filled up in a format as per first page of the document itself. He admitted that as per the proposal for credit limit was within the power of General Manager (ORI-I). He admitted that A3 was not having the power to sanction the limit which was applied by the borrower in the present case. The proposal of credit facility was processed at the head office and the same was sanctioned by the head office. He deposed that he had recorded the statement of Pradeep Kumar Aggarwal. He admitted that as per his statement, he was posted in credit department at CBI v. Rajat Gupta & Ors. Page188 of 248 regional office and that he was associated for the processing of credit proposal of the borrower in the present case at regional office and that the proposal was processed and checked at two levels i.e. at regional office and at head office. D-14 i.e. executive summary was prepared by K. B. Poojary, Chief Manager (ORI-I) of credit department. He deposed that he seized the document Ex.PW12/2, the over writing in date in encircled portion at point A was observed.
PW28 deposed that after seizure of Ex.PW12/2, he had not gone through the contents of that document. Since author of Ex.PW12/2 Sh. K. B. Poojary was already examined by PW28 as such he had not gone through the contents of Ex.PW12/2. He had recorded the statement of Sh. K. B. Poojary before the seizure of Ex.PW12/2. General Manager of head office i.e. ORI-I Mumbai was the sanctioning authority. He had not examined the sanctioning authority i.e. General Manager ORI-I of head office. The sanctioning authority was empowered to set and approve the terms and conditions of loan. He admitted that as per the sanction letter it is specifically mentioned in condition no. 15 that " NOC and credit CBI v. Rajat Gupta & Ors. Page189 of 248 report to be obtained from Union Bank of India on which the company is banking". The additional terms and conditions were also conveyed to Scope Complex Branch, Dena Bank under the signature of Sh. K.B. Poojary, Chief Manager Credit, Dena Bank head office. Ex.PW14/3 was seized from Sh. C. P. Singh. Letter addressed to Deputy General Manager, North India operations. The letter was written by Chief Manager ORI-I. He has not examined any witness who had attended the meeting as mentioned in Ex.PW14/3. He admitted that the said meeting was conveyed at HOC i.e. Head Office Committee and that K. B. Poojary was not the competent person to add or alter the terms and conditions of the sanctioning letter. He might had recorded the statements of the witnesses in order to check the authenticity of the letter Ex.PW14/3. He clarified that it was confirmed through statement of Sh. G. L. Khandelwal. Credit vouchers D-38/1 and D-38/2 which are Ex.PW8/J-10 and Ex.PW8/J-12 respectively were seized by him. He admitted that there is an overwriting in the date of the vouchers and that as per Ex.PW8/J-10 and Ex.PW8/J-11, the part loan was disbursed as per CBI v. Rajat Gupta & Ors. Page190 of 248 the direction of AGM, Scope Complex Branch A3 and that there was no post of AGM in Scope Complex Branch and that A3 was posted as Chief Manager in Scope Complex Branch and he was relieved on 13.05.1999 from the branch. He also admitted that the voucher dated 13.05.1999 was used by the bank official on 14.05.1999 when A3 has already left the branch.
PW28 further deposed that as per his investigation, the present case it was a term loan, certain amount was to be given by the party itself and certain amount by the bank in the form of term loan. The total cost of the project as per document is Rs.1797 lacs out of which the term loan was sanctioned for Rs. 7 crores. During the course of investigation PW28 came to know that the payment was made to Handy and Harman directly by the bank itself at the request of the borrower. He had not collected any letter or document which may prove the employment of A3 with A4 and taken the specimen handwriting of A3. He did not try to collect the admitted handwriting of A3. He admitted Ex.PW2/A is a certified true copy of a letter dated 11.05.1999. The original of Ex.PW2/A was CBI v. Rajat Gupta & Ors. Page191 of 248 in the possession of A-1 and he did not produce it before him. He had not arrested him for the recovery of original of Ex.PW2/A. He denied the suggestion that he did not conduct the fair investigation or that the CFSL report was manipulated and procured one at his instance or that he did not cite the material witnesses before the court in order to suppress the material facts or that A3 has been falsely implicated in the present case or that A3 did not commit any offence or that A3 has also been falsely implicated in the present case.
Defence evidence 48 In defence A1 examined DW1, who proved policy of bank regarding destruction of record as Ex DW1/A; statement of account of account no. CA-7092 for the period 12.12.2000 to 04.12.2002 as ExDW1/B; xerox copy of a demand draft bearing no. 634667 dated 07.05.1999 for Rs. 5 lacs favouring UP Finance Corporation and purported to be issued by Sir P. M. Road Branch Mumbai produced by A1 as Ex DW1/C; statement of account from CBI v. Rajat Gupta & Ors. Page192 of 248 the period 03.05.99 to 21.05.99 as Ex DW1/D. This witness was not cross-examined by CBI.
49 This Court heard arguments on behalf of learned Sr. PP for CBI and on behalf of the accused persons. This Court has also gone through the written arguments filed by the accused persons. Discussion 50 Now I have to see the culpability of each accused in view of the charge sheet filed and prosecution evidence discussed herein above.
Rajat Gupta (A1) 51 Ex PW3/A is a letter issued by PW3 whereupon there are signatures of one person namely Smt. Rekha Rani. However, PW3, whose name is Rekha Paswan deposed that at point Q9 signatures are not of her and she did not know who had written her name as "Smt. Rekha".
During cross-examination, it is not the case of A1 that CBI v. Rajat Gupta & Ors. Page193 of 248 this letter was not written on behalf of A4. This letter bears signatures of A1 at point Q11. Ex PW25/G wherein it is opined that Q11 and specimen signatures of A1 which are S1 to S73 and comparison thereof shows that specimen signatures agree with questioned signatures. Therefore, it is proved that Q11 bears signatures of A1. There is no specific challenge on behalf of A1 that Ex PW3/A does not bear signatures of A1. Therefore, A1 has signed document Ex PW3/A as Executive Director of A4.
PW2 proved Ex PW2/A which bears signatures of A1 at point Q3 as Director. Ex PW25/E mentions that specimen signatures S1 to S73 on comparison with Q3 agreed with each other in the minute and inconspicuous individual handwriting characteristics and not observed any fundamental difference in any of the basic writing characteristics between the questioned and the specimen signatures. Therefore, it is proved that at point Q3 bears signatures of A1 are there.
Ex PW2/A appears to bear impression of signatures of Sh. S. K. pasari, Regional Manager of UPFC at point Q1.
CBI v. Rajat Gupta & Ors. Page194 of 248 Therefore, it is proved that A1 had certified true copy of a forged letter of Sh. S. K. Pasari, Regional Manager of UPFC. On specific question, PW2 deposed that letter head of this letter is of UPFC but signatures of Sh. S. K. Pasari is on this letter. Similarly, letter is also Mark PW1/X1 and PW2 similarly deposed regarding this letter also. However, this Court is putting reliance on Ex PW2/A to adjudge the culpability of A1.
Ex PW8/D is letter written by A4 bearing signatures of A1 at point Q4. As per Ex PW25/E signatures of A1 at point Q4 proved signatures of A1. In Ex PW8/D there was request for disbursement of payment for machinery out of term loan sanctioned wherein it is mentioned that A1 had settled total dues of NSIC which also enclosed NOC from UPFC and no dues certificate from NSIC.
PW8 also deposed that Ex PW2/A which appears to be a certified copy of NOC dated 11.05.99 for creating charge from UPFC in favour of A4, Ex PW2/B, which is regarding proposal for one time settlement of outstanding dues of UPFC issued forged and fake letter. Ex PW2/B earlier was Mark PW1/X2. However, PW8 CBI v. Rajat Gupta & Ors. Page195 of 248 deposed that Ex PW2/A and Ex PW2/B are forged and fake letters. PW 8 further deposed that Ex PW8/N which is detail of payments were made to M/s Handy and Harman Refining Group for supply of machinery to A4.
Ex PW8/J8, Ex PW8/J9, Ex PW8/J10, Ex PW8/J11, Ex PW8/J12 and Ex PW8/J13 are credit vouchers. PW9 deposed that on the request of A4, the loan was debited from loan account no. 3981 of A4 and credited to current account no. 21387 of A4 by these documents. During cross-examination, there is no challenge to these documents and fact of disbursement of the loan from loan account to current account.
Ex PW11/2 is a letter issued by Sabara Impex Ltd. to Dena Bank and Ex PW11/3 is a letter issued by Dena Bank, Regional Office to the Chief Manager Dena Bank. By Ex PW11/2 which bears date 17.03.1998, Sabara Impex Ltd applied for term loan of Rs.11 lacs and working capital of Rs.2 crores.
Ex PW8/C is a letter dated 01.12.1998 whereby loan was sanctioned by the bank in favour of A4. Thus M/s Sabara CBI v. Rajat Gupta & Ors. Page196 of 248 Impex applied the loan on 17.03.1998 i.e. at the same relevant time and loan was sanctioned to A2 on 01.12.1998 whereby DGM informed to the Chief Manager of Dena Bank about the terms and conditions of sanctioned loan of A4. The Chief Manager of ORI-I of Dena Bank informed to DGM that he has recommended by the DGM, that GM has sanctioned a fund based limit of Rs. 8 crores and non-fund based limit of Rs. 1 crore in favour of A4. Thus all such facilities were informed by Ex PW11/10.
PW13 also deposed that during inspection they verified genuineness of Ex PW2/A and Ex PW2/B. Those letters were found forged and A1 had submitted photocopies of those letters. PW13 further deposed that Ex PW13/2 was verified by him in respect of genuineness. He alongwith Mr. Sachdeva, Chief Manager, Mr. Kukreja, Sr. Manager and himself went to NSIC office where those letter was found to be forged. These letters are regarding settlement of account with NSIC i.e. National Small Industries Corporation Ltd. He further proved his report Ex PW13/1 wherein he informed about that details of such letters have been mentioned CBI v. Rajat Gupta & Ors. Page197 of 248 therein. He further deposed that when the recovery was found doubtful the account was classified as Non Performing Asset. Sh. P. P. shetty, Sr. Manager visited the factory of the company and the factory was found under construction. It was found that 11 wooden boxes containing imported machinery were there inspite of this the company as asking for further disbursement of term loan amount.
During cross-examination, upon specific question, it is deposed by PW13 that when he visited the office of NSIC, it was informed that Ex PW13/2 has not been signed by any of the officer of NSIC. No suggestion has been given that observation/report made by PW13 qua Ex PW13/2 was false or incorrect. No suggestion has been given that any particular officer of NSIC had informed that Ex PW13/2 was signed by him or no information was recovered from NSIC that Ex PW13/2 was sent and signed by any of the officers of NSIC.
When relevant question no. 134 was put to A1 during his statement under Section 313 CrPC, then it is the case of A1 that company had submitted Ex PW2/A to Dena Bank alongwith Ex CBI v. Rajat Gupta & Ors. Page198 of 248 PW13/2 in file Ex PW7/B. It is further stated by A1 that Ex PW2/A was certified as "certified true copy".
When this piece statement of A1 is compared with the cross-examination of PW1 regarding Ex PW2/A and cross- examination of PW2 then no such defence has been taken by A1 during cross-examination of these witnesses who brought Ex PW2/A at the very initial stage. Therefore, the defence taken by A1 in his statement under Section 313 CrPC is not correct as no cross- examination has been done of all the relevant witnesses in terms of his statement.
PW26 also deposed about Ex PW1/A, Ex PW1/B, Ex PW2/A and Ex PW2/B as those documents were handed over vide Ex PW8/A which is a seizure memo. Ex PW27/2 (colly whole file) is regarding correspondence with UPFC and NSIC by A4 regarding credit facility availed by A4 from these financial institutions. File is perused.
In this file, letters are of the year 1998 wherein on most of the letters there were signatures of A1. These are of the year CBI v. Rajat Gupta & Ors. Page199 of 248 1998 which confirmed that A4 was enjoying the credit facility as provided by NSIC as well as UPFC. A1 put his signatures on letter Ex PW2/B as Director and certified the letter as true copy, representing that the said letter was sent by Sh. S. K. Pasari informing therein that UPFC had no objection to registering separate charge on the fixed assets of the new factory of A4.
Ex PW8/B which bears signature of another director of A4 suggested that such facts of enjoying facility with UPFC and NSIC were concealed by A4. However, since proceedings against A4 have already been dropped by my learned Predecessor vide order dated 20.04.2008 and the said order has attained finality since CBI has not challenged that order. Therefore, this Court is not going to see the culpability of A4 or any Director other than A1 but the fact remains that since it is proved beyond reasonable doubt that A1 had sent Ex PW2/A bearing his signatures by certifying as true copy and Ex PW2/B. Moreover, this Court also heavily relies upon Ex PW3/A which bears signatures of A1 at point Q11 wherein he was CBI v. Rajat Gupta & Ors. Page200 of 248 requesting for one time settlement with UPFC in April 1999 and in Ex PW2/A it was trying to put entirely different picture by forgery and fabrication of a document.
It is defence of A1 in reply to question no.114 of his statement under Section 313 CrPC that in none of these documents there was any condition for obtaining NOC from UPFC and NSIC but the fact remains that in Ex PW8/D at point Q4 wherein A1 himself informed that NOC from UPFC is enclosed.
Similarly, in reply to question no. 127 of his statement under Section 313 CrPC, it is stated by A1 that there is no mention about NOC from UPFC or NSIC in Ex PW11/23 but the fact remains that in Ex PW8/D, he himself informed about enclosure of NOC from UPFC. Again it is the defence of A1 that in CFSL report dated 29.04.2003 Ex PW25/E mentions that Ex PW2/A was not certified by A1 but the fact remains that result of examination shows that questioned and specimen signatures are agreed with each other in minute and inconspicuous individual characteristics. Expert has further opined that he has not observed any fundamental difference CBI v. Rajat Gupta & Ors. Page201 of 248 in any of the basic writing between questioned and specimen signatures. It is further the defence of A1 in reply to question no. 155 that Sh. Parveen Kumar, Director of A4 was interacting with Bank on behalf of the company but the fact remains that Ex PW8/D is a request for disbursement of loan bearing signatures of A1 at Q4 wherein alleged NOC from UPFC has been enclosed.
Moreover, in his statement under Section 313 CrPC, in reply to question no.419, A1 deposed :-
"UPFC issued a NOC letter dated 11.05.1999, that they would have no charge on the assets being funded by Dena Bank. NSIC also gave a no-dues and account settlement letter. As the OTS proposal was already pending with UPFC and the concerned employee had already provided the original receipt of Rs. 5.00 lacs, I had no reason of any doubt. Accordingly, the same alongwith NSIC settlement letter was forwarded in good faith with the letter dated 12.05.1999 to Dena Bank, particularly in the circumstances that all the conditions laid down in the Sanction letter dated 01.12.1998 had been complied with and adequate security was furnished by the company. The company had already contributed Rs. 3.00 crores towards the imported plant and machinery and Rs. 2.00 crores towards setting up of the infrastructure."
It is further stated in the statement that UPFC ostensibly had rejected the proposal of the company dated 03.04.1999. However, this Court is of the considered view that without CBI v. Rajat Gupta & Ors. Page202 of 248 confirmation that OTS proposal or rejected, A1 should not have issued Ex PW8/D as because of Ex PW8/D, the bank has suffered loss due to disbursement of credit facility. Therefore, in view of above discussion, A1 is held guilty of all the offences as observed herein by this Court.
In view of the observations made hereinabove, this Court comes to the conclusion that A1 has played active role in conspiracy by submitting forged document to Dena Bank. It is proved by the prosecution beyond reasonable doubt that A1 with co- accused persons hatched a criminal conspiracy to cheat Dena Bank, Scope Complex Branch, Lodhi Road, New Delhi and obtained Term Loan facility of Rs.6,49,74,000/- by forging letter dated 05.05.1999 and 11.05.1999 purportedly issued by UPFC and used the same as genuine to get disbursement of the loan in conspiracy with A3 as Chief Manager, Dena Bank, Scope Complex Branch, Lodhi Road, New Delhi, who misused his official position being a public servant. Thus, prosecution has successfully proved the charge against A1. Hence, A1 is guilty of offence punishable under Section 120B IPC CBI v. Rajat Gupta & Ors. Page203 of 248 read with Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of PC Act and Section 420/468/471 IPC read with Section 120B IPC.
Sh. Gyan Chand Verma (A2) 52 It is case of CBI that A2 was working as General Manager with A4. However, for this reason during arguments Learned Sr. PP for CBI relied upon letter dated 01.06.1998 available in file Ex PW7/B and he further relied upon letter dated 18.05.1998 addressed to A4 in the same file. However, both these letters have not been proved in accordance with law. CBI has proved that these letters are part of file Ex PW7/B which was maintaining in NSIC but whether these letters bear signatures or was addressed to A2. Even CBI has not been able to prove that A2 was working as General Manager with A4. The unfortunate part is that no witness was called by the prosecution who allegedly working with A4 to prove that A2 was working with A4 being employee of A4.
It is case of CBI that A2 was working as General CBI v. Rajat Gupta & Ors. Page204 of 248 Manager for A4 but the fact remains that when a person is working on such a high designation in a corporate sector then definitely various documents have been prepared such as identify card, appointment letter, PF file, his medical/ESI card, his punching card, his bank record regarding receipt of salary, his various communication, etc. to prove that this is a same person who was working as General Manager with A4. If a person is working as General Manager, then definitely he has subordinate staff who used to work with him and daily taking instruction and to report him. But no witness has been brought by CBI that he had working with A2. No such document has been brought. Even no person has been brought to prove that he has seen A2 signing and writing as General Manager of A4. No person who dealt with A4 and met A2 has been brought. In such circumstances, the very initial requirement that A2 had worked as General Manager with A4 at any point of time has not been proved by the CBI beyond reasonable doubt.
Therefore, CBI is not able to prove that A2 was working with A4. It is the case of CBI that A2 had signed at point Q1 by CBI v. Rajat Gupta & Ors. Page205 of 248 forging signatures of S. K. Pasari, Regional Manager of UPFC. These are only impression of signatures on Ex PW2/A. However, PW25 opined that simple signatures of A2 from S-74 to S-93 were taking and matched with Q1 but the fact remains that accept this weak evidence, no corroborative evidence has been brought by CBI to prove that A2 has forged sign at point Q1 of Sh. S. K. Pasari. Even no interest of A2 has been established to forge the signatures at point Q1 as CBI has not been able to prove that A2 was working with A4.
Learned Sr. PP relied upon Murari Lal v. State of Madhya Pradesh 1980 AIR 531 wherein Hon'ble Supreme Court observed:
".........In case where the reasons for the opinion are convincing and there is no reliable evidence throwing a doubt, the uncorroborated testimony of any hand- writing expert may be accepted. There cannot be any inflexible rule on a matter which, in the ultimate analysis, is no more than a question of testimonial weight. We have said so much because this is an argument frequently met with in subordinate courts and sentences torn out of context from the judgments of this Court are often CBI v. Rajat Gupta & Ors. Page206 of 248 flaunted."
Moreover, this Court has relied upon Magan Bihari Lal v. State of Punjab 1977 SCR (2) 1007, wherein Hon'ble Supreme Court held that it is unsafe to base a conviction solely on expert opinion without substantial corroboration. The Hon'ble Supreme Court further held that this rule has been universally acted upon and it has almost become rule of law which has held by Hon'ble Supreme Court in Ram Chandra v. State of UP AIR 1957 SC 361.
In such circumstances, this Court is of the view that CBI has not been able to prove the case against A2 beyond reasonable doubt. Therefore, benefit of doubt is given to A2 and he is acquitted after giving benefit of doubt.
However, this Court feels anguish the way IO has carried out the investigation as if A2 was working with A4 as General Manager then definitely it a proper investigation would have been carried out then substantial evidence could be collected. Either IO has put a false case upon A2 or he carelessly carried out the shoddy investigation by not collecting the evidence against A2. In all CBI v. Rajat Gupta & Ors. Page207 of 248 circumstances, this Court is of the considered view that a proper investigation has not been carried out in this case regarding the role of A2 in the criminal conspiracy.
Sh. Vinod Kumar Thukral (A3) 53 Ex PW8/C are the terms and conditions of the loan sanctioned informed by Dena Bank to A4 wherein at internal page 13 of this letter condition no. 7 specifically provides that in case account being taken over from other banks, the branch to obtain no objection certificate no due certificate and no charge certificate over the assets from their existing bankers before disbursement of advance.
PW8 further deposed that the NOC from the previous bank/institutions must be in original and not copy of the same. Bank has no authority to vitiate the conditions of NOC. However, Ex PW2/A is a photostat document which is certified as true copy by A1. In reference of which Ex PW1/B was issued on 17.09.1999 to UPFC, Noida wherein authenticity of Ex PW2/A and Ex PW2/B CBI v. Rajat Gupta & Ors. Page208 of 248 (Mark Ex PW1/X2) were asked to confirm.
PW11 proved Ex PW11/19 which bears signatures of A3 at point C. It is a letter dated 18.02.1999 wherein it was informed by A3 being that at his level the basic documentation has taken place guarantee papers at Mumbai and the party has started giving other compliance certificates. However, A3 very conveniently concealed in the said letter the very fact that Ex PW2/A and Ex PW2/B (Mark PW1/X2) were given by A4 are photocopy documents. He has not given any letter to A4 to provide original of NOC. He also did not intimate the DGM that this is a deviation from conditions stipulated by Ex PW8/C. PW15 deposed that in case before the disbursal of the limit, if the compliance does not come then no disbursal should be made. He has further deposed that it was the duty of the branch head to ensure compliance of terms of the sanction and this is true in this case also. NOC was to be in original for accepting it as document for release of term loan. Xerox copy whether certified cannot be accepted. In case photocopy whether certified or CBI v. Rajat Gupta & Ors. Page209 of 248 otherwise of NOC has been submitted then branch need to taken up with the concerned issuing authority confirming the authenticity of said NOC before disbursal.
PW17 also deposed that he had conveyed that A4 was at that time was banking with Bank of India, UPFC, NSIC, SIC and to ensure confirmation that A4 had no charge over assets of manufacturing division to be located at Noida. The letter is Ex PW17/1. He has further deposed that it was duty of the Head of Scope Complex Branch to ensure the compliance of such conditions before disbursement of the loan facility.
PW19 deposed that A3 had recommended credit facility to A4 and had therefore signed said proposal as a token of his recommendation. The proposal of A4 was being directly dealt with by A3. All the correspondences qua this loan account was attended with by A3.
During cross-examination of PW19 a suggestion was given on behalf of counsel for A2 and A3 that PW19 alongwith A3 went to regional office at the instructions of Chief Manager, NIO CBI v. Rajat Gupta & Ors. Page210 of 248 where PW19 went through the contents of the proposal of Ex PW12/1 or that thereafter PW19 put his signatures on the same in the capacity of Sr. Manager, Credit of the branch. However, suggestion is denied. However no signature has been confronted by counsel for A3 to PW19. It is further suggested that thereafter A3 in the capacity of Chief Manager put his signature. The suggestion has been denied. He further denied the suggestion that said proposal was already signed by Chief Manager, NIO, AGM, NIO and DGM.
PW19 further deposed that entries dated 14.05.1999, 21.05.1999 and 26.05.1999 collectively Marked X in the statement shown the loan amount disbursed to A4 on these dates. The suggestion was given on behalf of A3 that A3 refused to process the proposal of loan in branch inspite of insistence of PW19. A suggestion was given that A3 was proceeded on leave on 14.05.1999 or had been promoted and had reported at Calcutta or that he had wrongly marked his leave in Ex PW19/DA. The suggestions have been denied.
CBI v. Rajat Gupta & Ors. Page211 of 248 PW20 proved Ex PW12/7 which is a letter by Chief Manager, Scope Complex Branch to Deputy General Manager, Dena Bank regarding submission of clarification by A4, upon which Deputy General Manager at point encircled A asked from Chief Manager, Scope Complex Branch regarding comments / recommendations. Thereafter on the same letter at portion B Chief Manager, Scope Complex Branch submits his comments to Deputy General Manager, Dena Bank.
PW22 deposed that from June 1997 to January 2000, he was posted in Dena Bank, Scope Complex Branch as a Manager and A3 was Chief Manager of the branch at that time.
He has further deposed that it was the responsibility of the branch head to initiate letters to the financial institutions/banks and obtain NOC before the release of the funds and NOC addressed to the borrower and submitted to the bank are not usually accepted by the bank but if accepted that has to be verified firstly from the issuer of NOC. The verification is done by sending letters or by sending a bank official to ascertain the genuineness of the CBI v. Rajat Gupta & Ors. Page212 of 248 NOC. Only thereafter funds can be released subject to the completion of other terms and conditions.
He further deposed that he was never asked by A3 to write any letter to ascertain the status of UPFC account. He further deposed that Ex PW2/A was not dealt with by him and he has no knowledge who has submitted this letter or to whom it was submitted.
He further deposed that Ex PW11/8 at page no. 205 bears signatures at point A of A3 as Chief Manager, Scope Branch. He further deposed that he never asked by A3 and Sh. B. K. Gupta to write any letter to UPFC for obtaining NOC. Therefore, by the deposition of PW22 it is clear that A3 was the Chief Manager of the Scope Complex Branch and he did not ensure the compliance of complete formalities such as writing of a letter to financial institution before release of funds, as deposed by PW22. Even A3 did not ensure compliance to ascertain the genuineness of Ex PW2/A. During cross-examination, on behalf of A3, it is admitted by PW22 that in the present case since the proposal was of Rs. 7 CBI v. Rajat Gupta & Ors. Page213 of 248 crores as such the branch has limited role to play, therefore, after collecting the documents from the party, the same was sent to the Regional Office where the proposal was to be processed. Therefore, according to own case of A3, the branch head of Scope Complex Branch i.e. A3 after collecting the documents had sent to Regional Office therefore, it was the duty of A3 to collect the document i.e. original NOC or to ensure the genuineness of NOC and thereafter only to sent the file to the regional office.
A3 during answer to question no. 228 in his statement under Section 313 CrPC, has not disputed about mentioning of conditions for NOC and credit report in respect of the existing facilities from the Union Bank of India to be obtained before release of facilities. However, during answer to question no. 229, A3 simply stated that it is incorrect that it was the responsibility of the branch head to initiate letters to the financial institutions/banks and obtain NOC before the release of funds. A3 further stated in reply to question no. 230 that it is incorrect that while answering to ascertain the genuineness of the NOC. However, A3 has not clarified what CBI v. Rajat Gupta & Ors. Page214 of 248 was, according to him, the exact formalities to be observed in this regard.
A3 has admitted while answering question no. 419 that he was working as Chief Manager, Scope Complex Branch when A4 approached for the credit facility. It is his version that documention was done by the credit department of the branch. There was separate credit department in the branch and the same was headed by Sh. B. K. Gupta, Sr. Manager and was assisted by Sh. Ramesh Kukreja, Credit Manager. It is further stated by A3 that Sh. B. K. Gupta and Sh. Ramesh Kukreja were directly dealing with representative of A4 and there was no practice in the branch to submit the documents with A3 directly. This Court is of the considered view that the version given by A3 does not inspire confidence in the mind of the Court. It is his own case that he was working as Chief Manager i.e. Branch Head. As per official norms every document has been routed through branch head and it is the responsibility of the branch head to ensure smooth function of the branch. When forged documents have been received in the branch CBI v. Rajat Gupta & Ors. Page215 of 248 certified as true copy by debtor then definitely it was the duty of the branch head to ensure that no fraud or loss should take place to his institution. Even if A3 takes plea that Sh. B. K. Gupta and Sh. Ramesh Kukreja were directly dealing with A4 then he has not disclosed when it came into his knowledge that the loan was going to be disbursed to A4 as without ensuring the compliance of all formalities, the same should not be disbursed to A4 if it would have come in the knowledge of A3. Then definitely he could take steps to ensure that the loan should not be disbursed to A4. This Court is of the considered view that the version given by A3 in his statement under Section 313 CrPC does not inspire confidence.
In such circumstance, this Court is of the considered opinion that prosecution has been able to prove the charge against A3 that A3 alongwith co-accused person hatched criminal conspiracy to cheat Dena Bank, Scope Complex Branch, Lodhi Road, New Delhi and facilitated disbursement of Term Loan of Rs.6,49,74,000/- by misusing official position as Chief Manager, Dena Bank, Scope Complex Branch, Lodhi Road, New Delhi.
CBI v. Rajat Gupta & Ors. Page216 of 248 Hence, A3 is guilty of commission of offences as he intentionally in conspiracy with A1, did not obtain original NOC or tried to ascertain the genuineness of Ex PW2/A (as certified true copy by A1) and thus A3 has committed offences under Section 120B IPC read with Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of PC Act and Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of Prevention of Corruption Act, 1988 read with 120B IPC.
Conclusion 54 In view of the above discussion, this Court comes to the conclusion that prosecution has proved its case against A1 and A3 beyond any reasonable doubt :
55 It has been proved that A1 & A3 have committed offence under Section 120B IPC read with Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of Prevention of Corruption Act, 1988.
CBI v. Rajat Gupta & Ors. Page217 of 248 Further it is proved that A3 has committed offence under Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of Prevention of Corruption Act, 1988 read with 120B IPC. 56 Hence, A1 and A3 are convicted thereunder.
Dictated and announced in (Jitendra Kumar Mishra)
the open Court on 09.12.16 Special Judge, CBI (PC Act)
East District, KKD Courts : Delhi
CBI v. Rajat Gupta & Ors. Page218 of 248
IN THE COURT OF SH. JITENDRA KUMAR MISHRA
SPECIAL JUDGE (PC ACT) CBI,
KARKARDOOMA COURTS : EAST DISTRICT
DELHI
New CBI Case No. 52/2016
CNR No. DLKA01-000049-2003
RC No. 2(E)/02
PS/Branch: CBI/BS & FC/ND
IN THE MATTER OF :-
Central Bureau of Investigation (CBI),
VERSUS
1. Rajat Gupta
S/o Sh. Satish Chandra Gupta,
R/o 1301, Parasurampuria Tower no. 6,
Lokhandwala, Yamuna Nagar, Andheri
West, Mumbai,
Executive Director, M/s Aviquipo of India Ltd. ....C1
2. Sh. Vinod Kumar Thukral S/o Late Sh. S. L. Thukral, R/o E-355, Greater Kailash, Part-I, New Delhi, Former AGM, Dena Bank. ....C2 CBI v. Rajat Gupta & Ors. Page219 of 248 ORDER ON SENTENCE 1 Vide separate judgment dated 09.12.2016, A1 and A3 were held guilty and convicted for the following offences:-
a) C1 and C2 have been convicted for offences under Section 120B IPC read with Section 420/468/471 IPC and under Section 13 (1) (d) read with Section 13 (1) (2) of Prevention of Corruption Act, 1988.
b) C1 has also been convicted for offence under Section 420/468/471 IPC read with section 120B IPC.
c) C2 has also been convicted for offences under Section 420/468/471 IPC and Section 13 (1) (d) read with Section 13 (1) (2) of Prevention of Corruption Act, 1988 read with 120B IPC.
2 On 15.12.2016, arguments have already been advanced by Sh. Gurdial Singh and Sh. K. K. Patra, Learned counsel for C1, Sh. Rashid Hashmi, Learned counsel for C2, Sh. U. C. Saxena, Learned Sr. PP for CBI for about 1 hour on the point of sentence. Convicts have also been heard.
CBI v. Rajat Gupta & Ors. Page220 of 248 3 It is submitted by learned Sr. PP for CBI that the
offences for which the accused persons have been convicted effects the society at large and prays for maximum punishment and fine. 4 It is further submitted by learned Sr. PP for CBI that the accused persons have been convicted for the crime committed for economic offences which affects the economy of the country. It is further submitted that both the convicts have committed such offences that it affected the dreams of billions of people of this country towards the attainment of self-dependency of this country. Therefore, they have committed offence and convicted. Thus convicts deserve no leniency.
5 Learned Sr. PP for CBI further submits that accused persons are not small people. They are highly educated persons holding high educational qualifications and are role model of the people and the society where they used to sit and live.
CBI v. Rajat Gupta & Ors. Page221 of 248 6 Learned Sr. PP for CBI further submits that there was no
compulsion upon the accused persons to commit such economic offences for which they have been convicted. It is further submitted that crime has been committed 14 years ago which definitely caused huge loss to the country. It is further submitted that convicts have cheated the Government for a sum of about Rs.7 crores. Therefore, he submits that rigorous maximum punishment for the convicts. 7 Learned Sr. PP for CBI further submits that in this case A1 was the Executive Director of a company and A3 was the Chief Manager of the Bank. The duty of A3 was to ensure about genuineness of the documents filed before the Bank for disbursement of the payment. It is further submitted that public have faith upon such people and they are guilty of breach of the faith of public. It is further submitted that if such people are allowed to go scot free or only awarded minimum sentences then definitely it will convey wrong message to the society to the effect that nothing would happen if one does corruption.
CBI v. Rajat Gupta & Ors. Page222 of 248 8 Learned Sr. PP further prays that both the convicts
should be given maximum punishment as provided under statute. 9 Learned Sr. PP further claim cost of entire prosecution expenses as per Section 357 (1)(a) of CrPC for the amount of Rs.50 lac, since the CBI has investigated the matter thoroughly and called witnesses from different parts of the country. He further submits that CBI has taken services for the purpose of investigation of best professionals and also hired best prosecutors to bring the guilt at home of the accused persons. He further submits that keeping in view all the fact of rising cost of transportation, communication and various other applicable methods for the purpose of investigation and to bring the witnesses before the Court from different parts of the country, it will compensate to some extent the expenses incurred in the prosecution of this case.
10 Learned Sr. PP further submits that besides compensation as prayed hereinabove, convicts should also be CBI v. Rajat Gupta & Ors. Page223 of 248 imposed highest fine. He further submits that even fine to the tune of Rs. 50 lac should be imposed. These people misused their education and worked to put obstructions against the growth of this country.
11 Learned Sr. PP further argues that C2 should have been held accountable for making payment of such payments as he was public servant.
12 On the other hand, Sh. Gurdial Singh an Sh. K. K. Patra, learned counsels for C1 submits that C1 is 55 years old. He is having one unmarried daughter and widow mother aged about 78 years. It is further submitted that his wife is acute asthma patient. It is submitted that C1 has done MBA and CA. It is submitted that there is nobody else to take care of his family as he is only bread earner. It is submitted that now the C1 is unemployed and has nothing in his pocket. It is submitted that C1 is residing in rented accommodation with his family at Mumbai and due to present case, CBI v. Rajat Gupta & Ors. Page224 of 248 he lost his job. It is submitted that prior to Aviquipo Co., C1 was working as General Manager with Nixon Company. It is further submitted that during trial his father also left this world. It is further argued on behalf of C1 that later on the loss was made good by making recovery before DRT in recovery proceedings. 13 Sh. Rashid Hashmi, learned counsel for C2 submits that C2 is 70 years of age, retired from Bank and suffering from various old age aliments. He is suffering from Hyper Tension, Blood Pressure and diabetics. He is having one son and daughter and both are married. His wife is also suffering from various ailments and C2 is the only person to take care of her. It is submitted that C2 is having clean antecedents and he was awarded by his employer Bank in 1992-93 and 1999. It is further submitted that the branch which was headed by him was declared best as branch in India. He gave most of business to his Bank from Public Sector Undertakings.
CBI v. Rajat Gupta & Ors. Page225 of 248 14 The counsels for C1 and C2 further submit that though
convicts have been convicted in this case but definitely it has effect not only them but their families members, children and wives. 15 Learned Sr. PP for CBI countered the arguments and submits that exemplary punishment should be awarded as it will give deterrent effect in the society. He further submits that in the catena of judgments, Hon'ble Supreme Court has held that corruption should be dealt with iron hand and no leniency should be shown in corruption cases.
16 Learned Sr. PP further submits that it was upon the convicts when they had committed crime and if they did not think for such at the time of commission of crime then definitely they cannot claim leniency from this Court. He further submits that in catena of judgments Hon'ble Apex Court and other Courts, it is Courts held that in the current scenario prevailing in the country, it is quite evident that the evil of corruption is eating into the vital of the social CBI v. Rajat Gupta & Ors. Page226 of 248 fabric and corroding the character of the nation, while eroding the confidence reposed by the society in the public servants. 17 Learned Sr. PP has relied upon State of Rajasthan v. Dhool Singh AIR 2004 SC 1264, wherein the Hon'ble Supreme Court observed as under:-
"The courts should bear in mind that there is a requirement in law that every conviction should be followed by an appropriate sentence within the period stipulated in law. Discretion in this regard is not absolute or whimsical. It is controlled by law and to some extent by judicial discretion, applicable to the facts of the case. Therefore, there is a need for the courts to apply its mind while imposing sentence."
CBI has further relied upon judgment Sevaka Perumal, etc. v. State of Tamil Nadu AIR 1991 SC 1463, wherein Hon'ble Supreme Court observed as under:-
9. Therefore, undue sympathy to impose inadequate sentence would do more harm to the justice system to undermine to public confidence in the efficacy of law and society could not long endure under serious threats. If he courts did not protect the injured, the injured would then resort to private vengeance. It is, therefore, the duty of every court to award proper sentence having regard to the nature of the offence and the manner in which it was executed or committed etc. CBI v. Rajat Gupta & Ors. Page227 of 248
10. It is clear from the evidence that the accused indulged in illegal business of purchase and sale of ganja. They conspired to entice innocent boys from affluent families took them to far flung places where the dead body could not be identified. The letters were written to the parents purporting to be by the deceased to delude the parents that the missing boy would one day come home alive and that they would not give any report to the police and the crime would go undetected. For murder in a span of five years were committed for gain in cold blooded, premeditated and planned way. It is undoubted that if the trial relating to Athiappan murder had taken place and concluded earlier to the trial and conviction of other three murders are not relevant facts to be considered. But in this case the trial of the murder relating to Athiappan and Hariamachandran practically took place simultaneously by which date the appellants were convicted for the murder of Chellaurai and Christodas. Therefore, the reference of conviction and sentence by the Sessions Court to those two cases also are relevant facts. The deceased Harimachandran is no other than the nephew (elder sister's son) of A-1. This would establish his depravity and hardened criminality. No regard for precious lives of innocent young boys was shown.
They adopted the crime of murder for gain as a means of living."
18 He further submits that as per judicial verdict pronounced earlier in various cases that when the statutes provides maximum sentence, it is only for the talk purpose but it should be implemented. He further submits that if the Court is not going to CBI v. Rajat Gupta & Ors. Page228 of 248 pass maximum sentence, then there must be some strong reasons for not doing so by the Court. He further submits that if statutes provides maximum sentence then definitely maximum sentence should be awarded as there is no reason for non-awarding of maximum sentence. He strongly objects about leniency towards any of the accused persons.
19 This Court considers rival contentions of both the parties.
20 At the outset, this Court is of the view that the corruption in the country has reached to such an extent that our government has taken a drastic step for demonetization of the currency of this country in combating the black money and to up root the corruption. Corrupt people are affecting the economy of this country in a very drastic manner and corruption is eroding all the hard earned money of the honest people of this country and thus people of entire nation are bearing the burnt of the misdeeds of the corrupt people that they CBI v. Rajat Gupta & Ors. Page229 of 248 are forced to queued up to bear the burnt of the corrupt people and are participating just to collect currency of few thousands towards bank and ATMs. This Court is of the considered view that it is all because of those corrupt people applied their mind and energy towards none but only to bring the time when our elected government has chosen toughest measure to eradicate the evil of corruption.
In the present case, C1 is highly placed professional of an industry and C2 was highly placed banker. C1 was the Executive Director whereas C2 was Chief Manager of the Bank to facilitate the credit facility without following due procedure i.e. he shut his eyes towards due compliance of all the procedural formalities whereas A1 forged a letter of another public sector undertaking only to obtain credit facility by causing loss to the bank in conspiracy with the bank i.e. C2.
21 In the case titled Mehkar Singh Vs. Central Bureau of Investigation, Hon'ble High Court of Delhi 2011 (3) Crimes 94, CBI v. Rajat Gupta & Ors. Page230 of 248 (2011) ILR 4 Delhi 656 has held that :-
".......... There was no denial of the fact that the corruption by the public servants and particularly the law enforcers like the accused is an alarming menace to the society and which is spreading its tentacles in all walks of life. With regard to the quantum of sentence, nothing specific was pointed out by the learned defence counsel except for praying for leniency in view of the protracted pendency of the case. This was no ground to mitigate the gravity of the offence as per the catena of judgments of the Hon'ble Supreme Court and reference here can be made only to the case of State of A.P. Vs. V. Vasudeva Rao Manu/SC/0916/2003: (2004) 9 SCC 319.
In the given factual matrix, I am not persuaded to impose the minimum sentence as prayed by the learned defence counsel. In the overall circumstances, while maintaining the conviction as awarded by the learned Special Judge, I am of the view that ends of justice would be met by sentencing the accused to two years of rigorous imprisonment on each count. Consequently, the order of sentence stands modified in the sense that the accused shall stand sentenced for two years rigorous imprisonment each under section 7 and also under Section 13(2). The rest of the order shall remain unchanged. Both sentences shall run concurrently. The period of imprisonment already undergone shall be set off. The accused shall be taken into custody to undergo the imprisonment as awarded. The appeal stands dismissed."
In the case titled Raj Kumar Vs. State of Delhi, Hon'ble High Court of Delhi, 2015 IV AD (Delhi) 280 has held CBI v. Rajat Gupta & Ors. Page231 of 248 that :-
"..........So far as the sentence is concerned, the appellant as let off rather lightly by the learned Special Judge by awarding RI for one year with fine of Rs. 4,000/-, and on failure to pay the same, to undergo SI for four months for the offence under Section 7 of of the P.C. Act; and to further undergo RI for two years with fine of Rs. 6,000/- and on failure to pay the same, to undergo SI for six months for the commission of offence punishable under Section 13(1) (d) read with Section 13 (2) of the P.C. Act. The appellant, who as a Beat Constable, was found guilty of committing criminal misconduct by exploiting his authority to force the complainant to pay him bribe. An officer entrusted the task of protecting the law, blatantly breached the same. Looking to the rampant corruption prevalent in the society, the sentence should, and could, have been harsher. I am, therefore, not inclined to reduce the sentence awarded by the learned Special Judge. The appellant shall surrender forthwith and undergo the remaining sentence."
In the case titled State of Madhya Pradesh Vs. Shambhu Dayal Nagar Hon'ble Supreme Court of India, 2007 (2) ACR 1428 (SC) has held that :-
".......... The corruption by public servants has become a gigantic problem. It has spread everywhere. No facet of public activity has been left unaffected by the stink of corruption. It has deep and pervasive impact on the functioning of the entire country. Large scale corruption retards the national building activities and everyone has to suffer on that count. As has been aptly observed in Swatantar Singh Vs. State of Haryana reported in MANU/SC/0510/1997, lymph nodes, the vital veins of the body politics social fabric of efficiency in public service would improve only when the public CBI v. Rajat Gupta & Ors. Page232 of 248 servant devotes his sincere attention and does the duty diligently, truthfully, honestly and devotes himself assiduously to the performance of the duties of his post. The reputation of corrupt would gather thick and untraceably clouds around the conduct of the officer and gain notoriety much faster than the smoke.
And also in para no. 19 held that :-
..... From the analysis of the above decisions and the concerned provisions with which we are concerned, the following principles emerge:
a) When the court issues notice confining to particular aspect/sentence, arguments will be heard only to that extent unless some extraordinary circumstance/material is shown to the Court for arguing the matter on all aspects.
b) Long delay in disposal of appeal or any other factor may not be a ground for reduction of sentence, particularly, when the statute prescribes minimum sentence. In other cases where no such minimum sentence is prescribed, it is open to the court to consider the delay and its effect and the ultimate decision.
1. In a case of corruption by public servant, quantum of amount is immaterial. Ultimately, it depends upon the conduct of the delinquent and the proof regarding demand and acceptance established by the prosecution.
d) Merely, because the delinquent lost his job due to conviction under the Act may not be a mitigating circumstance for reduction of sentence, particularly, when the Statute prescribes minimum sentence".
In the case titled Shiv Nanda Sahay Srivastava Vs. The State of Bihar, Hon'ble High Court of Patna, 2011 (59) BLJR 124 has held that :-
CBI v. Rajat Gupta & Ors. Page233 of 248
" .......... when corruption was sought to be
eliminated from the polity all possible stringent measures are to be adopted within the bounds of law. One such measure is to provide condign punishment. Parliament measured the parameters for such condign punishment and in that process wanted to fix a minimum sentence of imprisonment for giving deterrent impact on other public servants who are prone to corrupt deals. That was precisely the reason why the sentence was fixed as 7 years and directed that even if the said period of imprisonment need not be given the sentence shall not be less than the imprisonment for one year. Such a legislative insistence is reflection of Parliament's resolve to meet corruption cases with a very strong hand to given signals of deterrence as the most pivotal feature of sentencing of corrupt public servants. All public servants were warned through such a legislative measure that corrupt public servants have to face very serious consequences. If on the other hand any public servant is given the impression that if he succeeds in protracting the proceedings that would help him to have the advantage of getting a very light sentence even if the case ends in conviction, we are afraid its fallout would afford incentive to public servants who are susceptible to corruption to indulge in such nefarious practices with immunity. Increasing the fine after reducing the imprisonment to a nominal period can also defeat the purpose as the corrupt public servant could easily raise the fine amount through the same means."
In the case titled Soman Vs. State of Kerala, Hon'ble Supreme Court of India, (2013) 1 SCC 382 has held that :-
"..........1 Courts ought to base sentence decisions on various different rationales - moth prominent amongst which would be proportionality and deterrence.
2 The question of consequences of
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criminal action can be relevant from both a
proportionality and deterrence standpoint.
3 In so far as proportionality is concerned, the sentence must be commensurate with the seriousness or gravity of the offence.
4 One of the factors relevant for judging seriousness of the offence is the consequences resulting from it.
5 Unintended consequences/harm may still be properly attributed to the offender if they were reasonably foreseeable."
In the case titled Mehkar A.B Bhaskara Rao Vs. Inspector of Police CBI, AIR 2011 SC 3845 Visakhapatnam, Hon'ble Supreme Court of India has also relied upon the judgment titled as State of M.P Vs. Shambhu Dayal Nagar MANU/SC/8623/2006 (Supra).
In the case titled Manish Jalan Vs. State of Karnataka, AIR 2008 SC 3074, Hon'ble Supreme Court of India, AIR 2011 SC 3845 has held that :-
12. .....In Hari Singh Vs. Manu/SC/0183/1988:
Sukhbir Singh and Ors. 1989 Cril. J. 116, while emphasizing the need for making liberal use of the provisions contain in Section 357 Cr.P.C. this court has observed thus:
It may be noted that this power of Courts to award compensation is not ancillary to other sentences but it is in addition thereto. This power was intended to do something to reassure the victim that he or she is not forgotten in the criminal justice system. It is a measure of responding appropriately to crime as well as of reconciling the victim with the offender. It is, to some extent, a constructive approach to crimes. It is indeed as step forward in our criminal justice system.
However, in awarding compensation, it is CBI v. Rajat Gupta & Ors. Page235 of 248 necessary for the Court to decide if the case is a fit one in which compensation deserves to be awarded. If the Court is convinced that compensation should be paid, then quantum of compensation is to be determined by taking into consideration the nature of the crime, the injury suffered and the capacity of the convict to pay compensation etc. It goes without saying that the amount of compensation has to be reasonable, which the person concerned is able to pay. It the accused is not in a position to pay the compensation to the injured or his dependents to which they are held to be entitled to, there could be no reason for the Court to direct such compensation.
In Sarwan Singh and Ors Vs. MANU/SC/0163/1978, State of Punjab : 1978 Cril. J 1598.
Very recently in Dilip S. Dahanukar Vs. MANU/SC/1803/2007 : Kotak Mahindra Co. Ltd. and Anr. 2007 Crl. J. 2417 explaining the scope and the purpose of imposition of find and/or grant of compensation to a great extent must be considered having the relevant factors therefore in mind. It may be compensating the person in one way or the other. The amount of compensation sought to be imposed, thus, must be reasonable and not arbitrary. Before issuing a direction to pay compensation, the capacity of accused to pay the same must be judged. A fortiori, an enquiry in this behalf even in a summary way may be necessary. Some reasons, which may not be very elaborate, may also have to be assigned; the purpose being that whereas the power to impose fine is limited and direction to pay compensation can be made for one or the other factors enumerated out of the same; but Sub Section (3) of Section 357 does not impose any such limitation and thus, power thereunder should be exercised only in appropriate cases. Such a jurisdiction cannot be exercised at the whims and caprice of a judge."
In the case titled Rekha Sharma Vs. Central Bureau of CBI v. Rajat Gupta & Ors. Page236 of 248 Investigation, 218 (2015) DLT 1, Hon'ble High Court of Delhi has held that :-
488. .......... The Supreme Court in its decision reported as (2013) 11 SCC 401, Jasvir Kaur Vs. State of Punjab expressed concern on the absence of a sentencing policy in the country and, therefore, cautioned the Courts to calibrate the punishment with due care and upon taking into account the relevant attending circumstances. The Supreme Court quoted with approval the luminous observations of English Judge Henry Alfred Mc Cardie which are reproduce hitherto-fore:
"....Trying a man is easy, as easy as falling off a log, compared with deciding what to do with him when he has been found guilty.
Chapter 19 of the Delhi High Court Rules deals with sentencing of offenders and throws insights on this aspect.
"1. The award of suitable sentence depends on a variety of considerations - The determination of appropriate punishment after the conviction of an offender is often a question of great difficulty and always requires careful consideration. The law prescribes the nature and the limit of the punishment permissible for an offence, but the Court has to determine in each case a sentence suited to the offence and the offender. The maximum punishment prescribed by the law for any offence is intended for the gravest of its kind and it is rarely necessary in practice to go up to the maximum. The measure of punishment in any particular instance depends upon a variety of considerations, such as the motive for the crime, its gravity, the character of the offender, his age, antecedents and other extenuating or aggravating circumstances, such as sudden temptation, previous convictions, and so forth, which have all to be carefully weighed by the Court in passing the sentence."
The facts of the present case as unfurled by the overwhelming evidence led by the prosecution at trial reveal a shocking and spine-chilling state if CBI v. Rajat Gupta & Ors. Page237 of 248 affairs prevalent in our country. An ingenious employment scam spanning across eighteen (18) districts of State of Haryana was given effect to by persons at the helm of power and the entire bureaucratic machinery fell prey to its satanic influence. Laudably, few individuals who were examined at the trial were forthright in the hour of adversity and did not succumb to the pressures exerted upon them from all quarters. Some individuals, such as PW-14, Dhup Singh, were not even high ranking officers of th Civil Services, but mustered courage to successfully repel the pressure exerted upon them.
It is submitted that the authors of the present crime were essentially public servants; who were duty bound to preserve and uphold the dignity of law. Some had even been administered 'oath' in terms of the Constitution of India. Yet they chose to flagrantly violate the law, betraying the trust reposed in them by the citizens and the Constitution. The very nature of the present crime, its magnitude, ramifications, designed manner of execution and the deleterious impact on the society at large, warrants a strict view, lest, justice be rendered sterile.
Very recently the Supreme Court in its decision pronounced on 06.05.2014 in the case of Dr. Subramanian Swamy Vs. Director, Central Bureau of Investigation and Another, (2014) 8 SCC 682 while holding section 6A of the Delhi Special Police Establishment Act, 1946 to be ultravires took serious note of malaise of corruption in our country and pertinently observed :
"77 This court in Shobha Suresh Jumani, took judicial notice of the fact that because of the mad race of becoming rich and acquiring properties overnight, or because of the ostentatious or vulgar show of wealth by a few or because of change of environment in the society by adoption of materialistic approach, there is cancerous growth of corruption which has affected the moral standards of th people and all forms of governmental administration.
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XXX XXX XXXX XXXX
XXX XXX XXXX XXXX
80 ...In the supplementing judgment, A.K
Ganguly, J. While concurring with the main judgment delivered by G.S. Singhvi, J. observed:
"Today, corruption in our country not only poses a grave danger to the concept of constitutional governance. It also threatens the very foundation of the Indian democracy and the Rule of Law. The magnitude of corruption in our public life is incompatible with the concept of a socialist secular democratic republic. It cannot be disputed that where corruption begins all rights end. Corruption devalues human rights, chokes development and undermines justice, liberty, equality, fraternity which are the core values in our Premabular vision. Therefore, the duty of the Court is that any anti- corruption law has to be interpreted and worked out in such a fashion as to strengthen the fight against corruption....."
81 In Balakrishna Dattatrya Kumbhar, this Court observed that corruption was not only a punishable offence but also, "undermines human rights, indirectly violating them, and systematic corruption, is a human rights' violation in itself, as it leads to systematic economic crimes".
82 In R.A. Mehta, the two-Judge Bench of this Court made the following observations about corruption in the society:
"Corruption in a society is required to be detected and eradicated at the earliest as it shakes "the socio-economic-political system in anotherwise healthy, wealthy, effective and vibrating society".
Liberty cannot last long unless the State is able to eradicate corruption from public life. Corruption is a bigger threat than external threat to the civil society as it corrodes the vitals of our polity and society.
Corruption is instrumental in not proper implementation and enforcement of policies adopted by the Government. Thus, it is not merely a fringe CBI v. Rajat Gupta & Ors. Page239 of 248 issue but a subject-matter of grave concern and requires to be decisively dealt with."
83 ..... It was observed :
"Abuse of public office for private gain has grown in scope and scale and hit the nation badly. Corruption reduces revenue; it slows down economic activity and holds back economic growth. The biggest loss that may occur to the nation due to corruption is loss of confidence in the democracy and weakening of the rule of law.".......
In the celebrated words of Martin Luther King, Jr. ; "Morality cannot be legislated, but behaviour can be regulated. Judicial decrees may not change the heart, but they can restrain the heartless."
22 It is pertinent to mention that in the judgment passed by this Court, it is proved C1 to C2 have cheated Dena Bank and caused loss of Rs.6,49,74,000/- on the date of offence. 23 After considering rival contentions and law cited by both the parties as well as case laws referred by this Court, this Court comes to the conclusion that long pendency of the trial or long time taken to conclude trial does not make a ground for mitigating sentence. Therefore, arguments raised by learned defence counsel to take lenient view due to such facts is not going to help all the convicts. The fact that later on, the loss was made good to bank, is also not going to help the convicts from criminal liability as till the CBI v. Rajat Gupta & Ors. Page240 of 248 date of filing of charge sheet, the loss was there and the fact of making loss good to the bank might be an attempt to mitigate the criminal liability.
24 The Court has to consider important fact that all the accused persons in this case are educated persons. A person committed offence when having sense of judgment to differentiate between right or wrong, should be given harsher punishment. Court can take judicial notice of public behaviour that whenever a culprit committed crime on the road, the entire public catches the culprit and handled in such a way that half of the punishment got by that culprit on the road itself. But that culprit sometimes not-educated, some educated or may have no education, may have no sense for right or wrong. But here C1 and C3 who applied their mind for right or wrong, took part in crime to cheat the Bank, who was providing them source of livelihood not only to them but other millions of people of the country.
CBI v. Rajat Gupta & Ors. Page241 of 248 25 This Court agrees with the contention raised by the Ld.
Sr. PP for CBI that in this country most of the people have made the way of corruption as their way of living style as it appears to them the easiest route to get early success and easy wealth. The corruption has spread to such an extent in the society that it becomes disease among professionals, medical professionals, educational professionals or even the custodian of the nation i.e. politician of this country. No corruption can take place until and unless the public opinion may give it sanctity. Sanctity only comes when it becomes the life style of the people of the country. Great Scholars of the country Chanakya and Vidur have mentioned in old tentaments that if servant of the king becomes corrupt then integrity of the State would be at threat. Here servant of the King would be C2 as he was getting salary from the State. Now, in the democratic system, every citizen of the country is like King of the State because all such citizens of the country elect their representative and those representatives conduct affairs of the State through public servants. It is the duty of the public servants that they should remain faithful to CBI v. Rajat Gupta & Ors. Page242 of 248 the State, otherwise integrity of the State would be at jeopardy. C2 is the employee of the State but not only the employee of the State but rather high officials of the State upon whom people of the State had faith. But instead to prove their faith, they committed the crime by joining the hands. Therefore, I do not find that any leniency can be granted as prayed by their respective counsels. 26 Ld. Sr. PP for CBI further submits that both the convicts are also liable for fine as all the offence under which they have been punished, they have to pay fine to the State. He further claims prosecution expenditure U/s 357 (1) (a) of Cr.P.C. He claims that heavy fine of Rs.50 lac be imposed upon convicts. He also claims prosecution expenditure of Rs. 50 lac, as he submits that CBI has investigated the matter thoroughly and called witnesses from different parts of the country. He further submits that CBI has taken services for the purpose of investigation of best professionals and also hired best prosecutors to bring the guilt at home of the accused persons. He further submits that keeping in view all the fact of rising CBI v. Rajat Gupta & Ors. Page243 of 248 cost of transportation, communication and various other applicable methods for the purpose of investigation and to bring the witnesses before the Court from different parts of the country. Rs.50 lac would not be actual cost incurred in prosecution but definitely it will compensate to some extent the expenses incurred in the prosecution. He claims that both the accused persons should be jointly liable to pay fine of Rs.50 lacs as State has suffered a lot due to conduct of such officers. He further submits that it is the offence which came into knowledge of prime investigating agency of this country on source information.
27 This Court further refers observation made by Hon'ble High Court Crl (M) No.1333/2015 titled as CBI v. Kanhiya lal & Ors. In para no. 11 & 12 :-
"11. Ratio decidendi of all these cases is that the cases relating to Prevention of Corruption Act cannot be treated as ordinary cases, where sentence ought to be suspended just for the asking. In such cases, the complainant alone is not a victim, but the sufferer is the society at large, whose interest ought to be placed on the high pedestal and the offender treated on a stricter footing. In the case of State of M. P. and Ors. v. Ram Singh 2000 (1) JCC (SC) 299; 2000 SCC (Crl.) 886, the Supreme Court CBI v. Rajat Gupta & Ors. Page244 of 248 observed as below :-
"8. Corruption in a civilized society is a disease like cancer, which if not detected in time, is sure to malignancies (sic) the polity of the country leading to disastrous consequences. It is termed as a plague which is not only contagious but if not controlled spread like a fire in jungle. It is virus is compared with HIV leading to AIDS, being incurable. It has also been termed as royal thievery. The socio-political system exposed to such a dreaded communicable disease is like to crumble under its own weight. Corruption is opposed to democracy and social order, being not only anti people, but aimed and targeted against them. It affects the economy and destroys the cultural heritage.
Unless nipped int the bud at the earliest. It is likely to cause turblence- shaking of the socio-economic-political system in an otherwise healthy, wealthy, effective and vibrating society."
12. In the current scenario prevailing in the country, it is quite evident that the evil of corruption is eating into the vitals of the social fabric and corroding the character of the nation, while eroding the confidence reposed by the society in public servants. Hence, the Courts must show extra caution while suspending sentence in a case of corruption. Further, even though the appellate court has ample powers and discretion to suspend the sentence, the said discretion has to be exercised judicially depending on the facts and circumstances of the each case."
CBI v. Rajat Gupta & Ors. Page245 of 248 28 Thus, this Court keeping in view all the facts and
circumstances and health of the accused persons, their age, their economic condition and responsibility towards their family and maintaining balance between reformative theory as argued by the Ld. Counsels for the Defence and arguments in favour of exemplary punishment to be awarded as argued by the Ld. Sr. PP. This court also takes into consideration the very fact that the conduct of both the convicts before this Court is always remained good, they have cooperated with calmness and always remained punctual during entire trial as per directions. This court is of the considered opinion that the punishment should be given to both the convicts as under :
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Convicts Offences Simple Fine (in Rs.) In default of
Imprisonment payment of fine
1. Rajat Gupta under Section 120B IPC read 5 years 3 lacs SI for 15 months
(C1) with Section 420/468/471 IPC
and Section 13 (1) (d) read
with Section 13 (1) (2) of
Prevention of Corruption Act,
1988.
under Section 420/468/471 5 years 2 lacs SI for 15 months
IPC read with section 120B
IPC
2. Vinod Kumar under Section 120 B IPC 5 years 3 lac SI for 15 months
Thukral (C2) read with Section
420/468/471 IPC and under
Section 13 (1) (d) read with
Section 13 (1) (2) of
Prevention of Corruption Act,
1988
under Section 420/468/471 5 years 2 lac SI for 15 months
IPC and under Section 13 (1)
(d) read with Section 13 (1)
(2) of Prevention of
Corruption Act, 1988 read
with 120B IPC.
29 All the sentences shall run concurrently.
30 The fine has been imposed upon all the convicts in view
of the fact that the convicts have committed offence with malafide intention and to obtain wrongful gain for themselves and caused loss to the economy of the country. This Court also taken into consideration that in this case CBI has examined 28 witnesses who were from the various parts of this country and thus the State has incurred expenditure to procure the attendance of those witnesses CBI v. Rajat Gupta & Ors. Page247 of 248 and ultimately to prove this case.
31 The fine imposed shall be dealt with U/s 357 (1) (a) Cr.P.C., out of the collected fine 25 % shall be applied towards the expenses incurred for the prosecution and is payable to CBI. Rest of the total collected fine amount shall be treated as fine payable to State, who has suffered pecuniary loss due to the crime committed by the convicts.
32 Benefit of Section 428 CrPC, if any, be given to all the convicts. 33 All convicts have been supplied with copy of judgment and order on sentence free of cost.
34 File be consigned to Record Room.
Dictated and announced in the open Court on 17.12.2016.
( JITENDRA KUMAR MISHRA)
SPECIAL JUDGE, CBI ( PC ACT)
EAST DISTRICT KKD COURTS: DELHI
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