Delhi District Court
Central Bureau Of Investigation vs . on 14 March, 2018
IN THE COURT OF MS. ANJU BAJAJ CHANDNA,
SPECIAL JUDGE, CBI (PC ACT)-06, CENTRAL DISTRICT,
TIS HAZARI COURTS, DELHI
CC No. 532252/2016
RC No. 14 (S)/92-Delhi
Central Bureau of Investigation
Vs.
1. Sushil Kumar Gupta, (Accused No.1)
S/o Sh. R.P. Gupta,
The then Director, M/s Pankaj Finance & Leasing Ltd.
Karampura, New Delhi-15,
R/o F-99, Ashok Vihar, Phase-I,
Delhi-52.
2. Narendra Kumar Gupta, (Accused No.2)
S/o Late Mool Chand Gupta
The then Director, M/s Pankaj Motors (P) Ltd.,
Karam Pura, Delhi-15,
R/o 2506 Chhota, Chamarwara, Tilak Bazar,
Opp. Novelty Cinema,
Delhi-6.
3. Manoj Kumar Gupta, (Accused No.3)
S/o R.K. Gupta,
R/o 1611, Pataudi House,
Daryaganj, New Delhi-110002.
4. Madan Lal Mahajan, (Accused No.4)
S/o Late K.D. Mahajan,
the then Sr. Manager,
Punjab National Bank (erstwhile New Bank
of India) 'L' Block Branch, Con. Place,
New Delhi.
R/o BT-42, Shalimar Bagh,
Delhi-52.
5. Charan Jeet Arora, (Accused No.5)
S/o Late Jagan Nath Arora,
The then Manager (Loans) Punjab National Bank
(erstwhile NBI) 'L' Block Branch, Con. Place
CBI Vs. Sushil Kumar Gupta & Ors. 1
New Delhi.
R/o A-23, Hans Apartments, East Arjun Nagar,
Shahdara Delhi-92.
6. Pawan Kumar Gupta, (Accused No.6)
S/o Sh. Gopi Ram Gupta,
the then Accountant, Punjab National Bank
(erstwhile NBI) 'L' Block,
Branch Con. Place Delhi. (since deceased)
R/o 39/31, Moh. Mahajana,
Purana Parao, Rohtak (Har.)
r/o 64, Prem Nagar, Near Shakti Nagar,
Delhi-7.
7. Kanwar Lal (Accused No.7)
S/o Ami Ram,
the Accountant, Punjab National Bank
(erstwhile NBI), 'L' Block,
Branch Con. Place Delhi.
R/o Vill. & PO Tekhand,
Near Okhla, Phase-1,
New Delhi-20.
8. M/s Pankaj Finance & Leasing Ltd. (Accused No.8)
101-102, Magnum House no.2, (Since Discharged)
Karam Pura, Commercial Complex,
New Delhi-15.
9. M/s Pankaj Motors (P) Ltd., (Accused No.9)
101-102, Magnum House no.2, (Since Discharged)
Karam Pura, Commercial Complex,
New Delhi-15.
Instituted on : 05.03.1994
Charge framed : 07.08.2002
Arguments concluded on : 22.02.2018
Decided on : 14.03.2018
Appearances: Sh. Amit Kumar, ld. PP for CBI with
Holding IO Sh. Sonal Mishra.
Sh. K.K. Patra, ld. Counsel for A-1.
Sh. M.K. Gupta, ld. Counsel for A-2.
Sh. Arun Sharma, ld. Counsel for A-3.
Sh.Y. Kahol, ld. Counsel for A-4.
Sh.K.G. Mishra, ld. Counsel for A-5.
Sh.S.S.Dogra, ld. Counsel for A-7.
CBI Vs. Sushil Kumar Gupta & Ors. 2
JUDGMENT
1. The CBI submitted the charge-sheet against M/s Pankaj Finance & Leasing Ltd. (for short 'PFLL') (A-8) and M/s Pankaj Motors (P) Ltd. (A-9) (for short 'PMPL') and its directors Sushil Kumar Gupta (A-1), Narendra Kumar Gupta (A-2), Manoj Kumar Gupta (A-3) and also against public servants Madan Lal Mahajan (A-4), Charan Jeet Arora (A-5), Pawan Kumar Gupta (A-6) and Kanwar Lal (A-7) all officials of Punjab National Bank (erstwhile New Bank of India), L Block Branch, Cannaught Place, New Delhi, for the offences punishable u/s 120-B r/w S. 420, 467, 468 and 471 IPC and under Section 13 (i) (d) r/w Section 13 (2) of the Prevention of Corruption Act, 1988 (hereinafter referred to as 'PC Act'). On Facts
2. The facts of the case as set out in the charge-sheet are that during the years 1988 to 1999, M/s PFLL represented by its directors conspired with bank officials (named above) of Punjab National Bank (erstwhile New Bank of India), L Block Branch, Cannaught Place, New Delhi and obtained loan of Rs.23,94,958/- sanctioned on the basis of forged documents and advance to the tune of Rs.11,45,146/- was given against seven vehicles which were CBI Vs. Sushil Kumar Gupta & Ors. 3 already financed by Corporation Bank, Karol Bagh Branch, New Delhi. An advance of Rs.4,14,864/- was given on the security of two vehicles without mortgaging the bills and other documents and an advance of Rs.8,34,948/- was given for financing four vehicles which were already financed by the same branch. The company M/s PFLL and M/s PMPL were registered with Registrar of Companies, Delhi and Haryana since 1984. The company converted itself into a Public Ltd. Company as per resolution of the company dated 21.08.1985. H.C. Sarkar was made Chairman, K.B. Gupta, Managing Director and S.K. Gupta, Director were whole time Directors of the company. The company obtained cash credit limit of Rs.200 lakhs from Punjab National Bank, L Block, Cannaught Place, New Delhi and Rs.25 lakhs from Corporation Bank, Karol Bagh, New Delhi for the purposes of financing of vehicles. The company was providing financial facilities to the parties through hire-purchase and tripartite lease agreements. Earlier cash credit limit of Rs.5 lakhs was sanctioned by PNB and documentation was done by accused Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5). Subsequently Madan Lal Mahajan (A-4) recommended for enhancement of cash credit limit to the tune of Rs.100 lakhs without getting the recommendation of Regional Office. The board CBI Vs. Sushil Kumar Gupta & Ors. 4 sanctioned the limit to the extent of Rs.85 lakhs on 10.07.1987 with the condition that company will introduce a deposit of Rs.200 lakhs for a period of one year. On the recommendation of Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5), cash credit limit was enhanced to the tune of Rs.200 lakhs. The company M/s PFLL was enjoying cash credit limit of Rs.200 lakhs with collateral security of Rs.1,92,547.18 on the personal guarantee of K.B. Gupta, the then Managing Director, Urmila Gupta and S.K. Gupta (directors) who were having very nominal net means. It has also been revealed that no pre-sanction or post-sanction inspection of M/s PFLL was conducted by the banking officers namely Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5). The documentation regarding cash credit limit of Rs.5 lakhs and Rs.85 lakhs was done by Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5). The documentation for enhancement of Rs.200 lakhs was done in the presence of Madan Lal Mahajan (A-4) on 27.02.1989 without obtaining the company's resolution. No charge of PNB was got registered with Registrar of Companies (RoC) at the relevant time and only simple charges were filed by three bank officers.
3. It is further alleged that bank officers sanctioned loans and enhanced drawing power limits of the company but the payments CBI Vs. Sushil Kumar Gupta & Ors. 5 were not made to the suppliers of the vehicles and amount was allowed to be withdrawn for the purposes other than for which loan was sanctioned. It is revealed that the amount of Rs.25 lakhs have been withdrawn by self cheques and approximately Rs.42 lakhs were transfered to accounts of other firms and sister concerns of M/s PFLL .
4. The bank was maintaining ledger known as Drawing Power (DP) register which was being maintained by banking clerk N.K. Sehgal under the supervision of Kanwar Lal (A-7) and Pawan Kumar Gupta (A-6) who were working as accountants. During the period 03.02.1988 to 23.01.1989, 13 vehicles were shown as financed by M/s PFLL on the basis of forged documents and DP was increased and an amount of Rs.16,29,255/- was allowed to be withdrawn by the company. The bank officers Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5) signed tripartite agreement(s), without verifying the genuineness thereof and DP was increased through the accountants Kanwar Lal (A-7) and Pawan Kumar Gupta (A-6).
5. It is further the case of prosecution that accused Madan Lal Mahajan (A-4), Pawan Kumar Gupta (A-6), Kanwar Lal (A-7) and Charan Jeet Arora (A-5) in collusion with directors of M/s PFLL and PMPL processed false documents during February 1988 pertaining CBI Vs. Sushil Kumar Gupta & Ors. 6 to two vehicles i.e. Loan No.19 (DCM Toyota) and Loan No.10 (Eicher Mitsubishi) without mentioning Registration, Engine or even Chassis No. It has been falsely shown that vehicles have been leased to Praveen Grover and Balwinder Singh and accordingly DP was got increased. Both these agreements were signed by Charan Jeet Arora (A-5) and DP was allowed by Kanwar Lal (A-7), (the then accountant). The documents were accepted only on the basis of proforma invoice without any receipt of dealers concerned.
6. Similarly, from February 1988 to June 1988, the documents pertaining to four vehicles viz.DBL-9432 (Loan No.18), DBL-890 (Loan No.53), DBL 933 (Loan No.47) and DBL-674 (Loan No.48) were processed falsely showing the same as leased by M/s PFLL to Geeta Bakshi, Manoj Kumar Gupta, N.K. Gupta and Ramesh Gupta and DP was released on forged documents. The tripartite agreements of concerned loan no.18 and 53 were signed by Charan Jeet Arora (A-5) and DP was allowed by Kanwar Lal (A-7) and Pawan Kumar Gupta (A-6) and lease agreements of loan No.47 and 48 were signed by directors of company and banking officials resulting in increase of DP. It has also been revealed that documents of loan No.47 and 48 are forged. It is also seen that DP has been given twice for the same vehicles (DBL 9342 and DBL-890). The bank CBI Vs. Sushil Kumar Gupta & Ors. 7 officials should not have disbursed loan on two occasions for the same vehicles. The tripartite agreements were signed by Charan Jeet Arora (A-5) and DP was allowed by Pawan Kumar Gupta (A-6).
7. The tripartite agreement with respect to loan No. 67 in the name of Gulshan Kumar Rajpal for vehicle (Eicher Mitsubishi Canter No.DBL-933) signed by Charan Jeet Arora (A-5) on 11.06.1988, whereas another agreement with respect to loan No.47 for the same vehicle was singed by Madan Lal Mahajan (A-4), Senior Manager on 11.04.1988. The tripartite agreement of loan No.72 dated 16.05.1988 in the name of Rajender Giri for Canter No.DBL- 674 signed by Charan Jeet Arora (A-5) while another agreement for the same vehicle was signed by Madan Lal Mahajan (A-4), Senior Manager. The DP was allowed by Pawan Kumar Gupta (A-6), the then accountant. It is further alleged that accused persons in connivance processed documents during January 1989 relating to lease agreement of 6 vehicles viz. DBL-156 (Loan No.83), DBL-155 (Loan No.85), DBL-9792 (Loan No.86), DBL-9791 (Loan No.87), DBL- 9139 (Loan No.88) and DBL-9213 (Loan No.89), despite the fact that these vehicles were already financed by Corporation Bank, Karol Bagh Branch, New Delhi under hire purchase agreements executed during February/March 1988 and on this basis DP was CBI Vs. Sushil Kumar Gupta & Ors. 8 released. The loan agreement of Canter No.DBL-579 (Loan No.84) was also forged as the vehicle was already financed with Oriental bank of Commerce, Shahdara. The documents were having forged valuation letters and original insurance cover notes but the insurance premium was not paid as cheque was dishonoured and no policies were issued against these cover notes making it clear that cover notes were obtained simply for the purpose of obtaining finance. The genuine lessees disclosed that vehicles were never sold to M/s PFLL, hence the sale letters enclosed with documents were forged. The tripartite agreements were signed and DP was allowed without verifying the vehicles or the genuineness of the documents. The invoices and sale letters have been fabricated to gain benefit from the bank to increase the DP. The value of 13 vehicles financed by PNB on which DP was allowed, was Rs.23,27,507 and DP to the extent of Rs.16,29,255/- was released.
8. False information was forwarded to head office on 19.09.1987 and 20.05.1988 by Charan Jeet Arora (A-5) that M/s PFLL has introduced the deposits of Rs.25 lakhs and Rs.200 lakhs respectively. The nexus between the bank officials and accused persons is clear and apparent as bank officials have written in their inspection report about M/s PFLL that "recovery position very CBI Vs. Sushil Kumar Gupta & Ors. 9 good", while the account of company remained over and above the drawing power. On 28.04.1989 there was debit balance of Rs.1,09,83,665.39 against DP of Rs.92.5 lakhs but still cheque of Rs.4 lakhs in favour of M/s Vishal Super Insulation was passed by Charan Jeet Arora (A-5). The real sister of Charan Jeet Arora (A-5) namely Ms. Menka Mehta and his nephew Vijay Khurana have been partners in M/s Vishal Super Insulation. The blank cheque of Rs.4 lakhs was given by Charan Jeet Arora (A-5) which was filled up by Ashok Kumar Bakshi, the then manager of M/s Vishal Super Insulation.
9. The conclusion drawn by prosecution agency has been that bank officers Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5) passed unauthorized payments and they abused their official position and obtained pecuniary advantage for themselves and also for the company and thereby caused corresponding loss to the bank.
10. Investigation by CBI continued for one year and seven months and on conclusion of the same charge sheet has been submitted on 05.03.1994. K.B. Gupta has since expired and as such his name has not been included in the chargesheet. The cognizance was taken on 15.04.1994.
CBI Vs. Sushil Kumar Gupta & Ors. 10 On Charge
11. Vide order dated 07.08.2002, the order on charge was passed in the following manner:
16. The ld. Prosecutor fairly conceded that no charge is made out against A-8 and A-9 since they are firms and mens rea cannot be attributed to them in the facts and circumstances of the case. I agree with him.
17. In above facts and circumstances, I am of the considered view that there is grave suspicion arising out of the material placed before the court about involvement of A.1, A.2, A.3, A.4, A.5, A.6 and A.7 (along with KB Gupta, since deceased) in the criminal conspiracy for cheating the bank out of its funds, with active involvement and participation of A.4, A.5, A.5 and A.7, public servants connected to the bank, who prima facie abused their official positions by corrupt/illegal means to facilitate the commission of the said crime. Charge is thus found made out for the offences u/s 120-B against A.1 to A.7. charge is made out against A.4 to A.7 for the offence u/s 13 (1) (d) r/w 13 (2) of Prevention of Corruption Act. Charge is also made out for offences u/s 468/467/471/420 IPC against A.1.
12. The formal charges were framed against all the accused as under:
• Accused Sushil Kumar Gupta (A-1) has been charged for the offence punishable u/s 120 B IPC and also substantive offences u/s 468, 467, 471 and 420 IPC • Accused Narendra Kumar Gupta (A-2) has been charged for CBI Vs. Sushil Kumar Gupta & Ors. 11 the offence punishable 120 B IPC.
• Accused Manoj Kumar Gupta (A-3) has been charged for the offence punishable 120 B IPC.
• Accused Madan Lal Mahajan (A-4) has been charged for the offence punishable 120 B IPC and also substantive offences u/s 13 (1) (d) r/w 13 (2) of PC Act.
• Accused Charan Jeet Arora (A-5) has been charged for the offence punishable 120 B IPC and also substantive offences u/s 13 (1) (d) r/w 13 (2) of PC Act.
• Accused Pawan Kumar Gupta (A-6) has been charged for the offence punishable 120 B IPC and also substantive offences u/s 13 (1) (d) r/w 13 (2) of PC Act.
• Accused Kanwar Lal (A-7) has been charged for the offence punishable 120 B IPC and also substantive offences u/s 13 (1)
(d) r/w 13 (2) of PC Act.
All the accused plead not guilty and claimed trial.
13. Accused Pawan Kumar Gupta (A-6) expired during the trial on 05.07.2014 and proceedings against him abated vide order dated 09.10.2017.
On Evidence
14. During the trial, prosecution has examined 60 witnesses. The CBI Vs. Sushil Kumar Gupta & Ors. 12 sum and substance of the prosecution evidence is as follows:
14.1. PW-1 Ved Prakash Singh S/o Budha Singh deposed about Mitsubhishi Canter Truck No.DBL-156. According to PW-1, he purchased the vehicle and had taken loan through M/s PFLL from the bank by executing documents. His guarantors were Janak Raj and Baldev Raj. The loan amount was repaid and thereafter he sold the vehicle to one Harish. His statement was recorded by CBI officers.
14.2. PW-2 Pratap singh S/o Harbans Singh deposed that he purchased two trucks make Swaraj mazda bearing No.DBL-9791 and DBL-9792 through M/s Pankaj Finance Limited, one in his own name and another vehicle in the name of his son Kuldip. The vehicles have been sold by him. According to the witness, sale letter dated 03.01.1989, Mark D does not bear his signatures. The agreement Ex.PW-2/A bears his signatures. 14.3. PW-3 Kuldip Singh s/o S. Partap Singh deposed that he got financed Swaraj Majda Trucks bearing No.DBL-9791 and DBL-9792 from a finance company. The witness identified his signatures on hire purchase agreement and other documents Ex.PW-2/A and Ex.PW-3/A to E. The witness denied his signatures on sale letter dated 04.01.89 Mark C. According to the witness he sold both CBI Vs. Sushil Kumar Gupta & Ors. 13 trucks to S. Dalip Singh, transporter of Naya Bazar. During cross-
examination PW-3 stated that finance company got his signatures on blank papers including sale letters as per general practice. 14.4. PW-4 Rajender Giri s/o Mahesh Giri stated that he had financed vehicle No.DBL-674 (Eicher Canter) in the year 1988. He identified his signatures on lease agreement dated 16.05.1988 Ex.PW-4/A and on other related documents Ex.PW-4/B to Ex.PW-4/E. The document Ex.PW-4/D bears the signatures of his grand mother- in-law, who also signed Ex.PW-4/A & B. 14.5. PW-5 Anita Malhotra S/o Triloki Nath Malhotra working as Stenographer with M/s PFLL in the year 1989, deposed about lease agreement executed with Vivek Kumar Aggarwal vide Ex.PW-5/A and related documents Ex.PW-5/B and Ex.PW-5/C and also lease agreement executed with Manoj Kumar vide Ex.PW-5/D and related documents Ex.PW-5/E & Ex.PW-5/F. 14.6. PW-6 Ramesh Chand s/o Banarsi Lal deposed that he never took loan through M/s PFLL, from New Bank of India on any vehicle. The documents shown to the witness (Mark X-1, X-2, X3 & X4 dated 11.04.1988) do not bear his signatures.
14.7. PW-7 Gupteshwar Singh S/o Late Munshi Singh, deposed that he has taken loan from M/s Pankaj Finance on vehicle DDL-890 CBI Vs. Sushil Kumar Gupta & Ors. 14 (Eicher Canter). He identified his signatures on loan agreement, power of attorney, promissory note etc. Ex.PW-7/A to Ex.PW-7/D. The installments were duly paid by him through cheques and at times through cash.
14.8. PW-8 Ashok Kumar Bakshi S/o Late Sohan Lal Bakshi joined M/s Vishal Super Insulation as manager. According to the witness, Sh. Vijay Kumar Khurana and Ms. Menka Mehta were the partners of the firm. Charan Jeet Arora (A-5) has been the uncle of Vijay Kumar Khurana and brother of Ms. Menka Mehta. The firm had no business dealing with M/s PFLL. The witness on seeing the cheque Ex.PW-8/A stated that it was filled up by him. The cheque was handover to him by accused Charan Jeet Arora (A-5) and same was already signed. The pay-in-slips Ex.PW-8/B were also filled up by him. The specimen handwritings of the witness were taken by CBI during investigation on Ex.PW-8/C1 to C6.
14.9. PW-9 Harcharan Singh S/o Dalip Singh deposed that he purchased Truck No.9792 in the year 1989 from Kuldip Singh through cash payment. The truck no. 9791 was purchased by elder brother of the witness through cash. They have no knowledge about any lien on the vehicle nor any installments were paid by them. The seizure memo Ex.PW-9/A bears his signature.
CBI Vs. Sushil Kumar Gupta & Ors. 15 14.10. PW-10 Naina Verma w/o Late Subhash Verma deposed that she has been Director of M/s Hind Profing Company and M/s Goodrich Tyres (P) Limited in the year 1988 and her husband was Managing Director. The vehicle DCM Toyota was obtained by M/s Hind Profing Company Private Limited. The vehicle was leased vide agreement dated 28.01.1988 Ex.PW-10/A bearing her signatures and signatures of her husband. She also identified signatures on related documents Ex.P-10/B to D. She denied having sold the vehicle to Geeta Bakshi. The installments were paid to M/s PFLL. The witness proved the affidavit Ex.PW-10/E. During cross- examination witness admitted that she did not use to go to office of the company and was not aware about day to day affairs of the company and the vehicle was sold somewhere in 1994 or 1995. 14.11. PW-11 Janak Raj Bhatia s/o late Bhagwan Dass deposed that he has given guarantee related to vehicle No.DBL-156 and he signed the agreement Ex.PW-11/A & promissory note Ex.PW-11/B and same were also signed by another guarantor Mr. Bhalla. The documents were executed and handed over to him. The installments were paid by the purchaser Ved Prakash relating to the aforesaid vehicles.
14.12. PW-12 Sanjeev Gambhir has been working with M/s CBI Vs. Sushil Kumar Gupta & Ors. 16 Geetanjali Motors Ltd., NOIDA. The witness identified his signatures on the agreement Ex.PW-12/A. 14.13. PW-13 Tilak Raj S/o B.K. Choudhary stated that he was the guarantor for the loan advanced to Kuldip Singh for purchase of Swaraj Mazda and stated that loan agreement Ex.PW-2/A bears his signatures. The agreement was signed by Pratap Singh in his presence and also pronote Ex.PW-3/C, Ex.PW-3/D and Ex.PW-3/E. 14.14. PW-14 G.D. Golani S/o Dalumal Golani, has been General Manager of PNB, Head Office, during 1987 to 1995. He granted sanction for prosecution with respect to accused Madan Lal Mahajan (A-4) vide sanction order Ex.PW-14/A. 14.15. PW-15 Renuka W/o Murari worked with M/s PFLL from the year 1988 to 1989 and was doing clerical job. The company was financing vehicles, TV and Refrigerators. She identified her signatures on loan agreement Ex.PW-15/1, which she signed at the instance of some officials of the company.
14.16. PW-16 Devi Dayal Gupta S/o Banarsi Dass Gupta has been knowing accused S.K. Gupta and deposed that he or his brother had not purchased any vehicle from M/s PFLL and refused his signatures on documents Ex.PW-16/1. According to the witness, the document is forged and also the signatures of his brother Ramesh Gupta. Also CBI Vs. Sushil Kumar Gupta & Ors. 17 the document Ex.PW-16/2 has been termed as forged and fabricated document by the witness.
14.17. PW-17 R.K. Hazrati S/o Lajpat Rai, posted as Manager with Vigilance Department in the Bank of India handed over documents as per seizure memo Ex.PW-17/1 to the Investigating officer on 25.06.1993.
14.18. PW-18 Pyare Lal Anand S/o Late Bhagat Ram Anand also handed over the documents during investigation vide memo Ex.PW- 18/A. 14.19. PW-19 Sanjeev Malhotra S/o B.R. Malhotra also handed over the documents vide seizure memo Ex.PW-19/A to Inspector CBI. 14.20. PW-20 Baldev Raj Bhalla S/o Shouri Lal Bhalla admitted that he stood guarantor for vehicle owned by Ved Prakash and identified his signatures on Ex.PW-11/A & B. 14.21. PW-21 S.K.Awasthi S/o Late R.K.K. Awasthi, Deputy General Manager, Punjab National Bank deposed that he has granted sanction with respect to accused Charan Jeet Arora (A-5) vide sanction order Ex.PW-21/A; with respect to Kanwar Lal (A-7) vide sanction order Ex.PW-21/B and; with respect to Pawan Kumar Gupta (A-6) vide sanction order Ex.PW-21/C. The witness has been thoroughly cross-examined on behalf of accused persons. CBI Vs. Sushil Kumar Gupta & Ors. 18 14.22. PW-22 Sunil Kumar Gandhi, Accountant in New Bank of India, Head office, Audit & Inspection Department, New Delhi handed over the documents during investigation vide seizure memo Ex.PW-22/A. 14.23. PW-23 Vikash Chander s/o Amba Prasad, deposed that he joined New Bank of India, L-Block, Connaught Place, New Delhi in the year 1992 and the same year he left the branch on promotion. On 29.01.1992, he conducted inspection with respect to some vehicles financed by bank to M/s PFLL because of some doubts and the position of account was bad. He proved his investigation by the following reports:
i. Report Ex.PW-23/A relating to vehicle No.DBL-9139 mentions that delivery note No.001986 dated 05.02.1988 is a bogus document.
ii. Report Ex.PW-23/B relating to vehicle No.9213 mentions that invoice cum delivery note No.002064 dated 15.02.1988 is a bogus document.
iii. Report Ex.PW-23/C relating to vehicle No.DBL-9791 mentions that sale letter dated 03.01.1989 is a bogus document.
iv. Report Ex.PW-23/D relating to vehicle No.DBL- 9792 CBI Vs. Sushil Kumar Gupta & Ors. 19 mentions that sale letter dated 04.01.1989 was a bogus document.
v. Report Ex.PW-23/E relating to vehicle No.DBL-155 mentions that sale letter dated 02.01.1989 was a bogus document.
vi. Report Ex.PW-23/F relating to vehicle No.DBL-579 mentions that receipt number 158383 of registration authority and insurance cover note are bogus documents.
i. Report Ex.PW-23/G relating to vehicle No.DBL-156 concluded that sale letter dated 03.01.1989 was a bogus document.
During cross-examination witness admitted that reports Ex.PW-23/A to Ex.PW-23/G have not been addressed to any authority and that no responsibility has been fixed by him as to any employee of the bank. The witness could not recollect, if CBI had recorded his statement in this case. The reports were prepared by him in the office. The witness denied the suggestions that reports were prepared by him without going through the documents or that reports are false and fabricated.
14.24. PW-24 O.P. Dahiya s/o Suraj Mal was posted as accountant CBI Vs. Sushil Kumar Gupta & Ors. 20 during December 1992 in New Bank of India, L-Block, Connaught Place, New Delhi. He handed over the documents to the IO vide Seizure memo Ex.PW-24/A & Ex.PW-24/B bearing his signatures. 14.25. PW-25 Charanji Lal Meena s/o Kistur Chand Meena, was working as LDC with Transport Department, 5/9, Underhill Road, New Delhi. On 05.09.1994, witness had handed over three original files to the IO vide memo Ex.PW-25/A. He also deposed about registration files of vehicles DBL 9213 Ex.PW-25/B, DBL 9387 Ex.PW-25/C, DBL 9361 Ex.PW-25/D. This witness has also been cross-examined.
14.26. PW-26 Satbir Singh Sahni S/o Jaswant Singh deposed that he stood guarantor for purchasing one DCM Toyota and he signed the lease agreement for taking loan from M/s PFLL . Later on, he was informed that no vehicle was delivered by the company and on asking for return of signed lease agreement, the company refused. The witness was called by CBI where Mr. Ajay Bakshi was also present. The witness identified his signatures on lease agreement Ex.PW-26/A and also identified signatures of Ajay Bakshi and Geeta Bakshi. During cross-examination witness deposed that all the documents were signed in the office of Pankaj Finance and he never visited the bank in this regard.
CBI Vs. Sushil Kumar Gupta & Ors. 21 14.27. PW-27 Balraj has been posted with Motor Licencing Officer during December 1993 to March 1995. He handed-over original registration file of vehicle No. DDD-6646 vide seizure memo Ex.PW- 27/A. The witness on going through the file stated that there was no hire-purchase agreement which was seized vide seizure memo Ex.PW-27/A but the financier has put his stamp and signatures on the reverse of form 30 (page 14) of the file. The financier is M/s PFLL and file is referred as Ex.PW-27/B. 14.28. PW-28 Pratap Singh S/o Late Hari Singh, deposed that he was working as process server with RTO Office, Tilak Marg, New Delhi. He handed-over registration file of vehicle No.DDA-1357, Maruti Van to IO vide seizure memo Ex.PW28/A and file is Ex.PW- 28/B. On 05.02.1988, the vehicle was transferred to M/s PFLL and on 02.12.1988, it was again transferred to H.B. Chawla and on 08.02.1989 it was transferred to Vipin Sabharwal. As per the records the vehicle was never financed to Sanjeev Kumar resident of Kirti Nagar through M/s PFLL .
14.29. PW-29 Arvind Kumar Goel, purchased Metadore DBL 579 which was financed by Oriental Bank of Commerce, Shahdara. He sold this vehicle and papers containing his signatures are Ex.PW- 29/A to Ex.PW-29/E. CBI Vs. Sushil Kumar Gupta & Ors. 22 14.30. PW-30 Dr. B.A. Vaid, expert in Scientific Examination of documents. The documents [Ex.PW-30/1 (39 sheets) and Ex.PW- 30/2 (4 sheets)] of this case were received by him. He expressed his opinion vide report Ex.PW-30/290 on the questioned documents and has given the details thereof. The standard documents have been containing specimen writings and signatures of accused Sushil Kumar Gupta (A-1), Narendra Kumar Gupta (A-2), Manoj Kumar Gupta (A-3), Madan Lal Mahajan (A-4), Charan Jeet Arora (A-5) and Pawan Kumar Gupta (A-6).
14.31. PW-31 Naresh Kumar Sehgal remained posted as clerk in New Bank of India, L-Block, Connaught Place, New Delhi during the period 1985-1990. The witness on showing the DP Register entries Ex.PW-31/B (pages no.18, 60, 79, 82, 81, 80, 36) deposed that entries at point Q 205, Q-209, Q-212, Q-215, Q-214, Q-213 are in his handwriting, which are Ex.PW-31/A to G respectively and also Ex.PW-31/I and Ex.PW-31/J. 14.32. PW-32 S.C. Jain, Manager, Punjab National Bank, Kundli deposed that he was manager New Bank of India, during the period 08.05.1991 till merger of bank with Punjab National Bank and he was in the inspection department from 08.05.1991 to October 1998. He and R.K.Arora had conducted inspection of New Bank of CBI Vs. Sushil Kumar Gupta & Ors. 23 India, L-Block, Connaught Place, New Delhi and as per the inspection report, Madan Lal Mahajan (A-4) was the Sr. Manager during the period 28.10.1985 to 24.06.1989 and V.K. Bhutani was the Sr. Manager from 25.06.1989 to 11.05.1990. The investigation pertained to account of M/s PFLL relating to sanction of Rs.2 Crores. The inspection report is proved as Ex.PW-32/1. The witness has been cross-examined at length by the defence. 14.33. PW-33 Gulshan Kumar Rajpal deposed that he purchased vehicle DDL 933 (Eicher Mini Truck) and proved lease agreement dated 10.06.1988 bearing his signatures. He had obtained finance for Rs.1 lakh and he repaid the same through installments in the office of M/s PFLL .
14.34. PW-34 Rati Ram Goyal s/o Late Mam Chand stated that house No.154-D, Kamla Nagar was constructed by him during the year 1947/1950. The address mentioned in the loan agreement dated 11.04.1988 of party N.K. Gupta s/o M.C. Gupta is incorrect as he never resided in that house.
14.35. PW-35 Alka Chopra, w/o Subodh Chopra, worked as receptionist in the office of M/s PFLL. She identified her signatures on Ex.PW-26/A vide which vehicle was financed in favour of Ms.Geeta Bakshi. Witness also identified her signatures on Ex.PW- CBI Vs. Sushil Kumar Gupta & Ors. 24 30/9, PW-30/10 and she also identified signatures of S.K. Gupta thereupon. During cross-examination on behalf of prosecution, the witness stated that she does not recollect whether her statement was recorded vide Mark Ex.PW-35/X. 14.36. PW-36 S.C. Mathur was posted as UDC in the office of Registrar of Companies and he handover the documents to the IO vide seizure memo Ex.PW-36/A. The documents have also been mentioned by the witness mark PW-36/X1 to X8.
14.37. PW-37 Asokan. DGM (marketing) M/s Eicher Motors Ltd. stated that vide seizure memo dated 18.12.1993 Ex.PW-37/A, the documents were handed over to the Investigating Officer and also deposed about documents Ex.PW-37/B to D. The witness also handed-over documents to IO through seizure memo Ex.PW-37/E and the documents are Mark PW-37/1 to PW-37/3. The witness was cross-examined by prosecutor, during which he stated that Mark PW-37/4 to Mark PW-37/7 do not appear to be genuine documents. The invoice Mark PW-37/8 is genuine but mark PW-37/9 (receipt) does not seem to the genuine. The witness has accordingly given his statement with respect to the various documents i.e. invoices, receipts etc. relating to Eicher Motors. Witness was also cross- examined by the defence.
CBI Vs. Sushil Kumar Gupta & Ors. 25 14.38. PW-38 Sarnam Singh s/o Gyan Singh stood as guarantor for Rajender Giri relating to purchase of Eicher Truck from M/s PFLL vide agreement Ex.PW-4/A & PW-4/B and he signed as guarantor. The witness also identified his signatures on agreement Ex.PW- 30/110 & Ex.PW-30/111. According to the witness he has not given any guarantee for 'Shivandra Singh' and he was asked to sign and therefore he signed. The witness also identified signatures of Brij Mohan Sharma on Ex.PW-30/110 and 30/111. The witness has been cross-examined.
14.39. PW-39 Brij Mohan Sharma S/o Chotu Ram, stated that agreements Ex.PW-30/110 & Ex.PW-30/111 contain his signatures, but he never stood as guarantor for Shivandra Singh. The witness has gone to the office of M/s PFLL with Sarnam Singh, who also signed on the agreement. The witness deposed that in good faith he signed the agreement.
14.40. PW-40 Surender Singh s/o Basant Singh, deposed about the purchase of Eicher Truck in his name through M/s PFLL. One agreement was signed by him as purchaser of the vehicle and another agreement was signed by his brother Balvinder Singh. However, only one vehicle was purchased in his name and no vehicle was purchased in the name of Balvinder Singh. The witness CBI Vs. Sushil Kumar Gupta & Ors. 26 identified the signatures on Ex.PW-30/107 of himself and other persons namely Baljeet Singh and Dig Vijay Singh. The vehicle was DBL-9139. According to the witness, another agreement was also signed showing the purchase of vehicle by his cousin Balvinder Singh, but no vehicle was purchased under this agreement. The witness has been cross-examined.
14.41. PW-41 J.S. Sethi has been the General Manager of New Bank of India, during the year 1992. The witness stated that by virtue of D-20 (proceedings of meeting of board of directors) limit of Rs.85 lakhs was sanctioned in favour of M/s PFLL against hypothecation of lease assets. He identified his signatures on the proceedings mark PW-41/A. The witness also deposed about the proceedings of meeting of board of directors dated 24.01.1989 mark PW-41/B whereby the limit was enhanced from Rs.85 lakhs to Rs.2 Crores. The limit was enhanced on the basis of note put up by credit department, head office on the receipt of request of Senior Manager of the branch. During cross-examination, witness could not recollect whether his statement was recorded by CBI. As per the practice, loan proposals are prepared by loan incharge and then forwarded to the manager of the branch. The loan proposal is routed through Regional office. In case of hypothecation of account, CBI Vs. Sushil Kumar Gupta & Ors. 27 it is a running account and debt is allowed as per drawing power. According to the witness, he had no role to play in sanctioning the loan with respect to note dated 01.07.1987 prepared by Credit department, head office Ex.PW-4/DA. The witness stated that on the strength of the note, the limit of Rs.85 lakhs was sanctioned. The witness further deposed about credit department note dated 05.09.1987 Ex.PW-41/DB, whereby certain terms and conditions of the sanction of cash/credit hypothecation limit of Rs.85 lakhs was sanctioned. In board meeting dated 24.01.1989, the limit was enhanced to Rs.200 lakhs referring to Credit Department note dated 05.12.1988.
14.42. PW-42 R.C. Suneja, S/o late L.R. Suneja was Chairman and Managing Director of the bank and he has also deposed about the proposal and sanction of limit of Rs.85 lakhs and enhanced limit of Rs.200 lakhs in favour of M/s PFLL. The witness has also been cross- examined, during which he stated that it was a cash credit account and the day to day operation of the account is looked after by the branch. Before sanction of the limit, the board considered everything including the note regarding guarantor. 14.43. PW-43 Naresh Kumar Sharma was working as officer with corporation bank, Karol Bagh, New Delhi. He handed-over CBI Vs. Sushil Kumar Gupta & Ors. 28 documents to the IO vide seizure memo dated 08.07.1993 Ex.PW- 43/A. The witness also proved the documents handed over through the seizure memo Ex.PW-43/B, Ex.PW-43/C, Ex.PW-43/D & Ex.PW- 43/E (collectively). The seizure memo dated 22.05.1993 is also proved by witness as Ex.PW-43/F, whereby seven documents were delivered to the IO.
14.44. PW-44 Harpal Singh, has been into the business of transport. The witness stated that in the year 1989 the vehicles were purchased bearing truck No.9791 (purchased by him) and truck No.9792 (purchased by his brother Harcharan Singh). Both the vehicles were purchased from Kuldip Singh and entire payment was made in cash. No loan was taken by them. During the investigation, they were summoned by CBI and they delivered the documents. During cross-examination, witness stated that he is not able to see clearly and he is not even able to see the presiding officer of the Court.
14.45. PW-45 Nand Lal S/o Mohan Lal, was working in the office of Registrar of Companies, Delhi and Haryana during December 1993 as dealing assistant. He was the custodian of file of M/s PFLL (1984-85). The firm was registered with ROC as private limited company on 18.07.1984. Smt. Urmila Gupta and Nehal Singh were CBI Vs. Sushil Kumar Gupta & Ors. 29 the directors, thereafter Sushil Kumar Gupta was appointed as director on 02.12.1985. Some other directors were appointed on 16.04.1986. The witness produced the relevant photocopy mark P- 36/X-7 (collectively). The company was having initially simple charge of Rs.5 lakhs and thereafter enhanced to Rs.85 lakhs and than to Rs.200 lakhs.
14.46. PW-46 Rita Gulati worked as Steno-typist with M/s PFLL during the period 1986 to 1991. She deposed that during the course of her duties she used to put her signatures on documents as per the directions of Managing Director K.B. Gupta and also Director S.K. Gupta. She identified her signatures on Ex.PW46/A (receipt). She also identified her signatures on Ex.PW-30/75 (lease agreement dated 09.07.1988 on the back side). The witness similarly identified and admitted her signatures on various documents relating to lease agreements and receipts etc. Ex.PW- 40/B, Ex.PW-40/C, Ex.PW-40/D, Ex.PW-40/E and Ex.PW-40/F etc. During cross-examination witness denied having given any statement to CBI. She had put her signatures on documents as she was directed to do so.
14.47. PW-47 I.P. Mahendru s/o Lal Chand Mahendru, remained posted as AGM, New Bank of India from April 1988 to January 1989. CBI Vs. Sushil Kumar Gupta & Ors. 30 According to the witness Madan Lal Mahajan (A-4) was the senior manager and Charan Jeet Arora (A-5) was the manager when the cash credit limit of M/s PFLL was enhanced. The witness identified signatures of Madan Lal Mahajan (A-4) Senior Manager on various documents shown to him during the recording of his statement/testimony. During cross-examination, PW-47 deposed that enhancement of sanction limit from Rs.85 lakhs to Rs.200 lakhs was sanctioned by board of directors. The conditions imposed by the board of directors while sanctioning the enhancement is Mark PW-41/D (D-21). The witness also admitted that branch head had no option but to send the proposal received from the parties to his higher authorities, if the proposal is beyond his discretionary power. It is only the competent authority who has to take the decision either for rejection or sanction. The board of directors has unlimited powers. The witness could not comment in respect of Ex.PW-47/D having no knowledge about the same. The proposal is routed through regional office. According to the witness he had not handed over documents to CBI. The witness could not say if the bank had incurred losses in this case.
14.48. PW-48 Sanjeev Kumar Tiwari S/o S.S. Tiwari was working as Accounts Officer for M/s PFLL . The witness identified accused Sushil CBI Vs. Sushil Kumar Gupta & Ors. 31 Kumar Gupta (A-1) as one of the director. The witness deposed about lease agreement, irrevocable power of attorney Ex.PW-30/81 to 85 and deposed that forms were filled up by him on the instructions of Sushil Kumar Gupta (A-1) and they contain signatures of K.B. Gupta. The witness deposed that forms and agreements etc. used to be filled up generally by S.K. Gupta or on his instructions by other staff members. The witness identified the signatures on documents Ex.PW-48/A to Ex.PW-48/C. During cross- examination, the witness stated that he was not aware whether the particulars so filled were correct or not. The CBI recorded his statement Ex.PW-48/DA and admitted that it is not recorded therein that he filled the forms on the instructions of S.K. Gupta. The witness had no knowledge about the relationship of the company with the bank, what was the sanction limit and whether any business was carried on rightly or wrongly with the bank. The witness stated that he was filling up the forms etc. at the instance of S.K. Gupta and denied to be deposing falsely. PW-48 also stated that he signed Ex.PW-30/83 & 84 as a witness and the persons who executed the documents also signed in his presence but the matter being old he was unable to recall. The witness denied the suggestion that he did all the jobs on the asking of K.B. Gupta. Due CBI Vs. Sushil Kumar Gupta & Ors. 32 to lapse of time, the witness admitted that he would not be able to specify as to which documents were filled up at whose instance. He denied the suggestion that he named S.K. Gupta and falsely implicated him for not having cordial terms with him. 14.49. PW-49 N.Surenderan remained associated with the investigation of the present case. He proved search memo Ex.PW- 49/A dated 01.01.1992 bearing his signatures whereby search was conducted at the residence of Madan Lal Mahajan (A-4). The observation memo Ex.PW-49/B and also proved search memo Ex.PW-49/C with respect to locker.
14.50. PW-50 Vivek Kumar Aggarwal S/o C.S. Aggarwal was working with M/s PFLL as recovery officer. He deposed that S.K. Gupta was one of the director along with other directors. The statement of witness was recorded by CBI. According to the witness he has no knowledge about the policy of the company. The witness was cross-examined by the prosecution. The witness identified his signatures on lease agreement Ex.P-30/72 as he signed the same at the instance of K.B. Gupta, but denied that S.K. Gupta asked him to sign the same. The witness also identified his signatures on lease agreement Ex.PW-38/87.
14.51. PW-51 Rajender Singh, Manager (administration) with M/s CBI Vs. Sushil Kumar Gupta & Ors. 33 PFLL during the year 1991, identified accused Manoj Kumar Gupta (A-3) and Sushil Kumar Gupta (A-1) in the Court. On 01.09.1992, the premises of the company was searched and the witness signed seizure memo Ex.PW-51/A. 14.52. PW-52 K. Venkatesh Kamath S/o late K.N. Kamath was working as officer with Corporation Bank, Karol Bagh, new Delhi during September 1992. He attended the office of CBI and handed over documents as per the seizure memo Ex.PW-52/A. 14.53. PW-53 Digvijay Singh S/o Moti Singh, identified his signatures on Ex.PW-30/107, which he signed for the purposes of purchasing commercial vehicle make Eicher. He signed these documents at the instance of his brother Baljeet Singh. The witness deposed that he signed at the instance of financer but could not recollect the name of financer. The witness was cross-examined on behalf of prosecution during which he denied that he along with his brother Baljeet Singh and cousin brother Surinder Singh and Rajeev were running transport business. The witness was cross-examined on behalf of defence.
14.54. PW-54 Satish Malik, S/o Late R.K. Malik was one of the director of M/s PFLL during 1985 to 1989. He stated that company was managed by managing director K.B. Gupta and Sushil Kumar CBI Vs. Sushil Kumar Gupta & Ors. 34 Gupta (A-1) was the whole time director.
14.55. PW-55 Menka Mehta W/o R.P. Mehta stated that accused Charan Jeet Arora (A-5) is her real brother. In 1987, she was working as clerk with Education Department, Delhi Government. She identified her signatures on Ex.PW-30/130 (D-153) (account opening form). She denied suggestion that she signed account opening form at the instance of her brother Charan Jeet Arora (A-5). She voluntarily stated that she signed the form at the instance of her husband.
14.56. PW-56 U.B. Bhatt, remained posted as Senior Manager, Corporation Bank, Karol Bagh from May 1991 to June 1994, he deposed about letter Ex.PW-56/A written by M/s PFLL to manager and stated about the procedure of drawing power. 14.57. PW-57 Narender Miglani S/o S.R. Miglani working as UDC with Motor Licencing Officer, Directorate of Transport, Under Hill Road, New Delhi, handed over the files pertaining to vehicles DBL- 156; DBL-579; DBL-155; DBL-9139; DBL-9791; DBL-9342; DBL-933; DBL-674; DBL-9792 and DBL-890, vide seizure memo Ex.PW-57/A. 14.58. PW-58 Jagdish Chander Bagla S/o Late Milkhi Ram Bagla, Assistant with Oriental Insurance Company during 1987-88, deposed about various cover notes of insurance company CBI Vs. Sushil Kumar Gupta & Ors. 35 whereupon he identified the signatures of K.K. Rajan, Development Officer.
14.59. PW-59 Srikurmam Raghu Ram S/o S.V. Nurasaiah stated that he was working as clerk with State Bank of Hyderabad, Scope Complex, Lodhi Road, New Delhi. On the directions of Branch Manager, he accompanied CBI for search in the office of M/s PFLL. The witness identified his signatures on Ex.PW-59/A. 14.60. PW-60 S.S. Sharma, Inspector CBI, investigated the case after registration of RC 14(S)/92 (CBI) on 31.08.1992. The witness has given the details of investigation and the documents collected and memos prepared by him during the investigation.
15. Thereafter, prosecution evidence was closed.
16. The statements of accused persons were recorded u/s 313 CrPC and entire evidence appearing on record were put forth to them in question/answer form to seek their explanation.
17. When questioned, accused S.K. Gupta admitted that he has been Director of M/s PFLL and that company was having cash credit limit from New Bank of India, firstly to the extent of Rs.85 lakhs and subsequently enhanced to Rs.200 lakhs. The accused recorded denial about the discrepancies appearing in the tripartite agreements relating to various vehicles during the transaction. The CBI Vs. Sushil Kumar Gupta & Ors. 36 accused has denied that officials of M/s PFLL have put their signatures on the agreements at his instance or that he has been whole-time director of the company. Accused further pleaded innocence and false implication and stated that witnesses have deposed under the influence of CBI. Accused stated that he has suffered financially, physically for last 25 years and his physical condition is deteriorating. He has not gained any pecuniary advantage from the alleged acts and that his professional and family life has been ruined due to this case. Accused stated that K.B. Gupta was the Managing Director of M/s PFLL , who expired in May 1991 and his family members absconded and accused was made scapegoat in this case. He also stated that he is HT and diabetic patient taking insulin twice daily and having prostate problem and was admitted twice in hospital for approximately 20 days due to septicemia diseases. His mother with whom he is living is also having sugar, kidney and HT problem and can't bear any shock. Accused preferred to lead evidence in his defence.
18. In his statement accused Narendra Kumar Gupta (A-2) stated that he has not been connected with M/s PFLL and has never been either the director or employee in this company therefore he has no knowledge about the same. Accused claimed having no knowledge CBI Vs. Sushil Kumar Gupta & Ors. 37 about the factum of applying cash credit limit by M/s PFLL and sanction of the same by the bank or about availing of various loans by getting drawing power increased on the basis of financing of various vehicles. When questioned about the specific vehicles with respect to which the funds were availed by M/s PFLL (DBL-155, DBL-9792, DBL-9139, DBL-9213, DBL-9791), accused Narendra Kumar Gupta (A-2) stated that he has neither been the director nor associated in anyway whatsoever with M/s PFLL. He has been the director in M/s PMPL. According to the accused, M/s PFLL may have used the proposals made by M/s PMPL and thereby used the funds sanctioned by the bank and M/s PFLL made payment of installments to the bank of its own. M/s PFLL neither informed M/s PMPL that loans have been approved by the bank in respect of proposal of vehicles. M/s PFLL was duty bound to produce and deliver the vehicles which was not done. The installments were to be received from M/s PMPL only after delivery of the vehicles. Also when questioned about the loan agreement dated 11.04.1988 accused stated that Narendra Kumar Gupta mentioned therein is of fictitious person and according to the report of expert, signatures are not matched with the specimen signatures of the accused. Accused claimed having no knowledge about most of the facts put- CBI Vs. Sushil Kumar Gupta & Ors. 38 forth to him during the recording of statement. Accused further pleaded that there is no evidence of any role on his behalf. He is innocent and falsely implicated. None of the witnesses have deposed anything against him. M/s PMPL was not the sister concern of M/s PFLL. A company becomes sister concern only when all the directors in the sister concern are also director in the parent company. He has not been the director in M/s PFLL.
19. Accused (A-2) further stated that M/s PMPL had put up proposal of leasing of six vehicles but the registration numbers were not given in the proposal. Registration number comes into picture when the finance and leasing company gets the finance from the bank and purchases the vehicle after receiving the margin money from the maker of proposal. M/s PMPL was never informed about the approval of loan and nor any margin money was demanded from M/s PMPL in respect of the proposal of the vehicles. According to Narendra Kumar Gupta (A-2), there is no incriminating evidence against him on record and he has been made scape-goat by the prosecution. He preferred to lead evidence in his defence.
20. In his statement u/s 313 CrPC, Manoj Kumar Gupta (A-3) claimed having no knowledge about most of the facts and evidence put-forth to him. The accused has denied statements of PW-5, PW- CBI Vs. Sushil Kumar Gupta & Ors. 39 6, PW-7, PW-11, PW-16, PW-23, PW-37, PW-50 and PW-60. He has also disputed the expert report and evidence of PW-30. The accused claimed innocence and false implication in the matter. He preferred to lead evidence in his defence.
21. Accused Madan Lal Mahajan (A-4), when questioned about the facts and evidence, replied in the manner that same are matter of record and for some facts he denied having any knowledge. The accused has denied the statement of IO whereby six vehicles were found to be already financed with Corporation Bank and even then finance was taken from New Bank of India by executing forged documents. The accused also denied that two vehicles were not in existence which were shown to be leased and with respect to four vehicles, loans were availed from New Bank of India and the frauds were detected by Vikas Chandra, who had taken over as Manager, New Bank of India in the year 1989. Accused claimed that witnesses have deposed under the pressure of CBI and further claimed false implication. Accused also pleaded that sanction has been granted without application of mind and under influence of CBI.
22. In his statement recorded u/s 313 CrPC accused Charan Jeet Arora (A-5) claimed having no knowledge about most of the facts whereas for some facts and evidence he replied that same are CBI Vs. Sushil Kumar Gupta & Ors. 40 matter on record. Accused pleaded that sanction has been granted without application of mind and under influence of CBI.
23. Accused Kanwar Lal (A-7) claimed that his tenure was from December 1987 to 01.03.1988 and he has no connection with the witnesses. Accused further pleaded that he was not accountant but was only management trainee. The Investigating officer placed wrong facts before the sanctioning authority S.K. Awasthi (PW-21) and sanction has been granted without application of mind. IO has not given him notice during the investigation. Accused claimed false implication in this case. The accused has further denied his signatures on page no.18 of DP register (D-68) and the statement of PW-31 in this regard. According to the accused, he had no authority being management trainee. The documentary evidence has been explained by the accused as a matter of record, but stated that he had no nexus with the same. Accused also pleaded that false case has been registered by IO against him. He had no authority to sanction the loan or to release the drawing power (DP) being the management trainee only. He preferred to lead evidence in defence.
24. In defence, five witnesses have been examined as follows:
25. D1W1 Pradeep Kumar, Assistant Manager, Corporation Bank, CBI Vs. Sushil Kumar Gupta & Ors. 41 Branch Karol Bagh appeared, but stated that he could not find statement of account pertaining to M/s PMPL for the period 01.04.1988 to 31.03.1989. The branch manager has given letter Ex.D1W1/A to the effect that said statement of account was not available as such statements only maintained for a period of 10 years.
25.1. D1W-2 R.K. Saini, Senior Technical Assistant, Office of Registrar of Companies brought the summoned record pertaining to PMPL. The company earlier had two directors namely Narendra Kumar Gupta (A-2) and Kunj Bihari Gupta and thereafter Ms. Urmila Gupta was inducted as Director of the said company from 25.06.1988. Narendra Kumar Gupta (A-2) resigned from the company on 02.09.1990.
25.2. D5W1 Parveen Kumar Arora, Senior Manager, PNB, inspection and audit division, Rajendra Bhawan was summoned to bring record pertaining to ENBI guidelines with regards to annual inspection of the branches issued and conducted by the Inspection Department of ENBI during the period 1986 to 1990; Bank's guidelines with regards to annual statutory audit of the branches as per direction of Reserve Bank of India issued by the Accounts or Inspection Department of ENBI during the period 1986 to 1990 and; CBI Vs. Sushil Kumar Gupta & Ors. 42 guidelines with regards to Quarterly Visit Report to be conducted by Senior Officers of Regional Office/controlling Office of the Branches issued by the Inspection Departments of ENBI during the period 1986-1990 but the record was not traceable due to the merger of bank into PNB.
25.3. D5W2 Vishwabandhu Ravindra Nath was summoned to bring record i.e. statement of cash credit account of M/s Vishal Super Insulation bearing account number 1541 for the period 01.04.1989 to 31.03.1992 maintained at ENBI L-Block, New Delhi; Statement of cash credit account of PFLL with new Bank of India bearing account number 1491 for the period 01.04.1989 to 31.03.1992; report of internal auditors during the period 1986 to 1990 of ENBI, B.O. L-Block Connaught Place new Delhi to check whether the Audit Report has indicated irregularities in the account of PFLL; report of external auditors during the period 1986 to 1990 of ENBI, B.O. L. Block Connaught Place New Delhi to check whether the Audit Report has indicated irregularities in the account of PFLL; Report of statutory auditors during the period 1986 to 1990 of ENBI, B.O. L Block Connaught Place New Delhi to check whether the Audit Report has indicated irregularities in the account of PFLL; Report of RBI auditors during the period 1986 to 1990 of ENBI, B.O. L Block CBI Vs. Sushil Kumar Gupta & Ors. 43 Connaught Place New Delhi to check whether the Audit Report has indicated irregularities in the account of PFLL and; Quarterly visit report of the Branch (L-Block New Delhi) by the Senior Officers of the Regional Office Delhi of ENBI during the period 1986 to 1990, but stated that record not available having been destroyed vide circular Ex.D5W2/A. 25.4. D5W3 Yogender Verma was summoned to bring record i.e. Statement of account of PFLL bearing current account no.1132 maintained with corporation Bank Karol Bagh New Delhi for the period 01.04.1989 to 31.03.1992, but stated that record not available vide letter Ex.D5W3/A.
26. Thereafter defence evidence was closed on behalf of all the accused by recording separate statements.
On Arguments
27. I have heard arguments advanced by Amit Kumar, Ld. Public Prosecutor for CBI, K.K. Patra, ld. Counsel for Sushil Kumar Gupta (A-
1), M.K. Gupta, ld. Counsel for Narendra Kumar Gupta (A-2), Arun Sharma, ld. Counsel for Manoj Kumar Gupta (A-3), Y. Kohal and Kunal Kohal, Ld. Counsels for Madan Lal Mahajan (A-4), K.G. Mishra, ld. Counsel for Charan Jeet Arora (A-5) and S.S. Dogra, ld. Counsel for Kanwar Lal (A-7) and analysed the facts, evidence and CBI Vs. Sushil Kumar Gupta & Ors. 44 documents appearing on the record in the light of contentions raised by all the parties involved. I have also examined written submissions filed by Narendra Kumar Gupta (A-2) and Charan Jeet Arora (A-5) on record.
28. The prosecutor from CBI submitted that matter relates to cash credit limit granted in favour of PFLL by erstwhile new Bank of India (now merged in PNB). The PFLL firstly had the credit limit of Rs.85 lakhs, which was subsequently enhanced to Rs.100 lakhs and then to Rs.200 lakhs on the recommendation of Senior Manager Madan Lal Mahajan (A-4). The cash credit limit was enhanced by virtue of board resolution passed in the meeting of board of directors of New Bank of India and condition was imposed that company would introduce deposit worth Rs.2 crores but the said condition was not complied with and the communication was falsely transmitted that the condition has been so complied. Thereafter, the CCL limit was illegally availed by Directors of PFLL in collusion with Directors of PMPL and bank officers (public servants) and by showing false and fabricated documents with respect to lease of various vehicles, the drawing power (DP) was got enhanced and funds withdrawn. The documentary evidence has been brought on record establishing forgery on the part of PFLL and PMPL and conspiracy with bank CBI Vs. Sushil Kumar Gupta & Ors. 45 official is further clear as they facilitated various withdrawals in favour of company. The checks and controls were not properly exercised by the bank officers and after releasing the amounts on account of various vehicles, even registration certificates were not obtained to ascertain that the vehicles were transferred in the name of purchasers. It is important to note that vehicles were second hand vehicles and were already possessed by their respective owners, but PFLL has falsely shown the lease of vehicles without any authority. The prosecution has been able to bring cogent and consistent (oral and documentary) evidence to establish its case against the accused(s). Learned Prosecutor submitted that sanction for prosecution of public servants (A-5, A-6 & A-7) is valid and legally granted by the sanctioning authority and that the sanction orders itself show that entire material was examined by sanctioning authority before according sanction.
29. Arguing on behalf Sushil Kumar Gupta (A-1) K.K. Patra, ld. Counsel argued that the transactions were carried out by managing Director K.B. Gupta and he only used to deal with the bank officials concerning cash credit limit. Accused Sushil Kumar Gupta (A-1) never played any role either in signing loan documents or otherwise. No agreement or document was signed by Sushil Kumar CBI Vs. Sushil Kumar Gupta & Ors. 46 Gupta (A-1) and therefore knowledge of forgery can not be attributed to him and he deserves to be acquitted in this case. The Company PFLL has not been charged in the present case and therefore no vicarious liability can be fastened upon accused Sushil Kumar Gupta (A-1) merely for the reason that he has been one of the directors thereof.
30. Arguing on behalf of Narendra Kumar Gupta (A-2) ld. Counsel M.K. Gupta submitted that accused Narendra Kumar Gupta (A-2) has not been dealing with bank. Accused Narendra Kumar Gupta (A-
2) was director of PMPL till 02.09.1990 and he had no knowledge about the affairs of PFLL. There is no evidence against him to show his involvement in the transactions with New Bank of India. There has been no connection between PFLL and PMPL. Only the proposals were given by PMPL for some vehicles which might have been misused by PFLL for obtaining the finance from the bank but no transaction actually materialized as no vehicle was delivered to PMPL.
31. Arguing on behalf of Manoj Kumar Gupta (A-3), ld. Counsel Arun Sharma submitted that although A-2 has been related to N.K. Gupta as cousin but he had no role to play in respect to the company M/s PMPL. Accused only stood as guarantor for the CBI Vs. Sushil Kumar Gupta & Ors. 47 company and signed the documents at the instance of Narendra Kumar Gupta (A-2) lessee. It was not in the knowledge of the accused that the company has been seeking finance on second hand vehicles which were already financed to their genuine purchasers.
32. Arguing on behalf of accused Madan Lal Mahajan (A-4), Ld. Counsel Yudhistor Kohal submitted that accused was working as Senior Manager with New Bank of India. The sanction granted by PW-14 for prosecution is not valid as the witness was not competent to remove the accused from his position and therefore was not competent to grant the sanction. Otherwise also, the sanction has been granted without application of mind and only at the instance of CBI, sanction order was signed. It is further submitted that accused has been working as Senior Manager and was having wide supervisory powers. Accused only signed agreements pertaining to two vehicles (DBL-674 & DBL-933) on behalf of bank at the instance of junior officials in good faith believing that documents were in proper order. The accused in discharge of his official duties, was not required to make specific verification about each vehicle and purchaser thereof. It has been the duty of junior officials of the bank to make verifications and to CBI Vs. Sushil Kumar Gupta & Ors. 48 put up the papers for signing. The documents were generally signed by manager (loans) and only in the absence of Manager (loans) Charan Jeet Arora (A-5), accused Madan Lal Mahajan (A-4) signed the agreements. Accused had no knowledge about any illegalities or discrepancies as same were not brought to his notice at any point of time. No wrongful loss has resulted to the bank in respect of CCL limit of PFLL as no such evidence has been brought on record.
33. Arguing on behalf of Charan Jeet Arora (A-5) K.G. Mishra ld. Counsel submitted that accused was manager (loans) during the relevant period but he has not committed any offence. Accused used to receive documents from accountants and signatures were put presuming that documents were in order and genuine transactions of sale and purchase of vehicles were being carried out thereby, by PFLL. No wrongful loss has resulted to the bank in respect of CCL limit as no such evidence has been brought on record. When the accused left the bank, CCL limit was in operation and continuing. On the issue of cheque of M/s Vishal Super Insulation worth Rs.4 lakhs as deposed by PW-8, it is argued that out of Rs.4 lakhs, Rs.2.5 lakhs were credited in the account of PFLL on behalf of M/s Vishal Super Insulation. The official position has CBI Vs. Sushil Kumar Gupta & Ors. 49 not been misused by accused Charan Jeet Arora (A-5) and he signed the papers as he was required to sign the tripartite agreements etc. as per norms and procedure of the bank. Accused was not a party to alleged forgery or cheating.
34. On behalf of Kanwar Lal (A-7) it is argued by Counsel S.S. Dogra that he only worked as management trainee and he had no authority to make any entry in DP register or to release funds in favour of PFLL. During his tenure as trainee, he worked only at the instructions of I.P. Mahendru (PW-47) and there is no evidence appearing against the accused showing his connection with alleged illegalities or forgery of agreements or related documents. Findings:
35. Before adverting to the evidence on record, relevant legal position as regards, what constitutes conspiracy may be noted at the outset. Section 120-A defines criminal conspiracy as under:-
"When two or more person agree to do, or cause to be done, (1)An illegal act, or (2) An act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy:
Provided that no agreement except an agreement to commit an offence shall amount to a criminal conspiracy unless some act besides the agreement is done by one or more parties to such agreement in pursuance thereof.
CBI Vs. Sushil Kumar Gupta & Ors. 50 Explanation:-It is immaterial whether the illegal act is the ultimate object of such agreement, or is merely incidental to that object."
Thus, ingredients of the offence of criminal conspiracy are:
(i) an agreement between two or more persons;
(ii) an agreement must relate to doing or causing to be done either
(a) an illegal act;
(b) Act which is not illegal in itself but is done by illegal means.
36. To establish a charge of conspiracy, indulgence in either an illegal act or a legal act by illegal means is necessary. The definition of `illegal' is provided for in section 43 of the Indian Penal Code.
"43. The word `illegal' is applicable to everything which is an offence or which is prohibited by law, or which furnishes ground for a civil action; and a person is said to be `legally bound to do' whatever it is illegal in him to omit."
37. The word `illegal' as defined u/s 43 of Indian Penal Code has been given a very wide meaning. It consists of three ingredients:
a) everything which is an offence or ;
b) everything which is prohibited by law; or
c) everything which furnishes ground for civil action. CBI Vs. Sushil Kumar Gupta & Ors. 51
38. With regard to conspiracy, Section 10 of the Indian Evidence Act comes into play which reads as under:-
"10. Where there is reasonable ground to believe that two or more persons have conspired together to commit an offence or an actionable wrong, anything said, done or written by any one of such persons in reference to their common intention, after the time when such intention was first entertained by any one of them, is a relevant fact as against each of the persons believed to so conspiring, as well for the purpose of proving the existence of the conspiracy as for the purpose of showing that any such person was a party to it."
39. Analysis of Section 10 of Indian Evidence Act would show that it envisages:
(1) prima facie evidence affording a reasonable ground for a court to believe that two or more persons are members of a conspiracy; (2) if the said condition is fulfilled, anything said, done or written by any one of them in reference to their common intention shall be evidence against the other;
(3) anything said, done or written by the alleged conspirators should have been said, done or written after the intention was formed by any one of them;
(4) it would also be relevant for the said purpose against another who entered the conspiracy, whether it was said, done or written before he entered the conspiracy or after he left it, and (5) it can only be used against a co-conspirator and not in his favour."
40. Four well known fundamental requirements for proving conspiracy by way of circumstantial evidence are: CBI Vs. Sushil Kumar Gupta & Ors. 52
(I.) circumstances from which the conclusion is drawn be fully established;
(II.) all the facts should be consistent with the hypothesis of guilt; (III.) circumstances should be of a conclusive nature and tendency; (IV.) circumstances should, by a moral certainty, actually exclude every hypothesis but the one proposed to be proved;
41. It may be noted that criminal conspiracy in terms of Section 120B of the Code is an independent offence which is punishable separately. Conspiracy requires an act (actus reas) and an accompanying mental state (mens rea).
42. Legal position is well settled that in order to constitute a single general conspiracy there must be a common design. The evil scheme may be promoted by few, some may drop out and some may join at a later stage, but the conspiracy continues until it is broken up. The conspiracy may develop in successive stages. There may be general plan to accomplish the common design by such means as may from time to time be found expedient. When the ultimate offence consists of a chain of actions, it would not be necessary for the prosecution to establish to bring home the charge of conspiracy, that each of the conspirators had the knowledge of what the other collaborator would do, so long as it is known that the collaborator would put the goods or service to an unlawful use. CBI Vs. Sushil Kumar Gupta & Ors. 53
43. Direct independent evidence of criminal conspiracy is generally not available and its existence is a matter of inference, are normally deduced from acts of parties in pursuance of a purpose in common between the conspirators. It is not always possible to give affirmative evidence about the date of the formation of the criminal conspiracy, about the persons who took part in the formation of the conspiracy, about the object, which the conspirators set before themselves as the object of conspiracy, and about the manner in which the object of conspiracy is to be carried out, all is necessarily a matter of inference.
44. Meeting of minds of two or more persons for doing an illegal act or an act by illegal means is sine qua non of the criminal conspiracy but it may not be necessary prove the agreement between them. The existence of conspiracy and its objectives can be inferred from the surrounding circumstances and the conduct of the accused involved. Incriminating circumstances must form a chain of events from which a conclusion about the guilt of the accused could be drawn. A conspiracy may further be a general one and a separate one. A smaller conspiracy may be a part of a larger conspiracy.
CBI Vs. Sushil Kumar Gupta & Ors. 54
45. Court while drawing an inference from the materials brought on record to arrive at a finding as to whether the charges of the criminal conspiracy have been proved or not, bears in mind that a conspiracy is hatched in secrecy and it is, thus, difficult, if not impossible, to obtain direct evidence to establish the same. The manner and circumstances in which the offences have been committed and the level of involvement of the accused persons therein are relevant factors. For the said purpose, it is necessary to prove that the propounders had expressly agreed to or caused to be done the illegal act but it may also be proved otherwise by adducing circumstantial evidence and/ or by necessary implication. To establish an offence of criminal conspiracy, it is not required that a single agreement should be entered into by all the conspirators at one time. Each conspirator plays his separate part in one integrated and united effort to achieve the common purpose. Each one is aware that he has a part to play in a general conspiracy though he may not know all its secrets or the means by which the common purpose is to be accomplished.
46. Cumulative effect of the proved circumstances has to be taken into account in determining the guilt of the accused rather than adopting an isolated approach to each of the circumstances CBI Vs. Sushil Kumar Gupta & Ors. 55 and each one of the circumstances has to be proved beyond reasonable doubt, while appreciating evidence relating to the conspiracy, Court takes care to see that the acts or conduct of the parties must be conscious and clear enough to infer their concurrence as to the common design and its execution.
47. (As regards the aforenoted legal position, following precedents are referred : Mohammad Usman Mohammad Hussain Maniyar & Ors. v. State of Maharashtra 1, Jagannatha Shetty, J in Kehar Singh and Ors. v. State (Delhi Administration 2, State of Maharashtra v. Som Nath Thapa3, K.R. Purushothaman v. State of Kerala4, State (NCT) of Delhi v. Navjot Sandhu @ Afsal Guru 5, Ram Narayan Popli Vs. CBI6,Yogesh @ Sachin Jagdish Joshi v. State of Maharashtra7,Nirmal Singh Kahlon v. State of Punjab and Others8)
48. In the light of above said legal position, evidence brought on record by both the sides, is required to be considered to find out whether prosecution has established necessary facts and circumstances to prove charge of conspiracy as well as substantive offences.
49. The matter relates to cash credit limit granted in favour 1 (1981) 2 SCC 443] 2 1988 (3) SCC 609 at 731 3 (1996) 4 SCC 659 4 (2005) 12 SCC 631 5 (2005) 11 SCC 600 6 (2003) 3 SCC 641 7 (2008) 6 SCALE 469 8 2008 (14) SCALE 639 CBI Vs. Sushil Kumar Gupta & Ors. 56 of M/s PFLL by New Bank of India, L Block, Cannaught Place, New Delhi. The company was initially having cash credit limit of Rs.85 lakhs which was later enhanced to Rs.200 lakhs. The bank through its board of directors sanctioned the enhanced limit of Rs.200 lakhs in favour of company. The proposal was sent by Madan Lal Mahajan (A-4), Senior manager and condition was imposed for deposit of Rs.200 lakhs upon the company before disbursement of payment under cash credit limit. It is also the case of prosecution that M/s PFLL was having a loan account and separate cash credit limit of Rs.25 lakhs from Corporation Bank, Karol Bagh, New Delhi.
50. The main business of the company was giving hypothecation loans against the vehicles and documents duly executed between the company (PFLL) and the parties, used to be submitted in the bank and thereafter depending on the value of the vehicle (s), the drawing power used to be fixed by the bank. The procedure for enhancing the DP was that on submission of agreements and relevant documents, the margin of 25% as per the value of vehicle (s) was kept and DP for rest value used to be increased. The separate register (DP register) used to be maintained with respect to the various loan agreements entered into by the company. The particulars of the vehicles used to be CBI Vs. Sushil Kumar Gupta & Ors. 57 mentioned in the documents. As per rules and procedure, the original agreement between the borrower and leasing company, irrevocable power of attorney, demand promissory note, performa invoice, copy of insurance etc. were required to be deposited with the bank. According to the prosecution, the bank officers in conspiracy with directors of M/s PFLL, illegally got the DP increased by submitting forged and fabricated documents relating to various vehicles and in this way the public money was allowed to be withdrawn from the bank and PFLL utilized to its benefit.
51. The wrongful loss has resulted to the bank due to illegal enhancement of DP and withdrawal of various amounts by M/s PFLL.
52. The first contention raised by prosecution has been that on the recommendation of Madan Lal Mahajan (A-4), the cash credit limit was enhanced in favour of PFLL from Rs.85 lakhs to Rs.200 lakhs. The documentation for enhancement of Rs.2 Crores was done in the presence of Madan Lal Mahajan (A-4) without obtaining the companies resolution. The condition was imposed about introducing the deposit of Rs.2 Crores. The condition for introduction for deposit of Rs.2 Crores was not complied with and it has been falsely submitted as fulfilled through D-24 Ex.PW-30/129. CBI Vs. Sushil Kumar Gupta & Ors. 58
53. However, on analyzing I find that this contention has not been proved beyond reasonable doubt. It is evident from the testimony of PW-41 J.S. Sethi, (General Manager) and PW-47 I.P. Mahendru (Asstt. General Manager) that limit was enhanced in the meetings of Board of Directors, New Bank of India dated 10.07.1987 and 24.01.1989 and the meetings were chaired by R.C. Suneja, Chairman. It is further clear that accused Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5) were not the part of said board meeting and only the proposals were prepared and forwarded for sanctioning. It is admitted by I.P. Mahendru (PW-47) that branch head had no option but to send the proposal received from the parties to higher authority, if the proposal was beyond his discretionary power. It is only the competent authority who had to take decision, either for rejection or sanction.
54. Although the recommendation was made by senior manager vide Ex.PW-31/184 for enhancement of cash credit limit from 85 lakhs to 200 lakhs but the decision making power was with the Board. The accused(s) have not attended the meetings of board of directors nor were consulted before making the decision about enhancement. In such circumstances, it is not justified that exclusive responsibility is put upon accused Madan Lal Mahajan (A- CBI Vs. Sushil Kumar Gupta & Ors. 59
4) or Charan Jeet Arora (A-5) for getting the cash credit limit enhanced in favour of PFLL. With respect to the condition that deposit of Rs.2 crores was never introduced and condition was not fulfilled and false report was sent to the head Office, I find that there is no specific evidence on record on this issue. None of the bank witnesses have come forward to state that no such deposit of Rs.2 Crores was introduced by PFLL. There is nothing on record to suggest that the note vide Ex.PW-30/129 was falsely submitted. In this regard no criminal liability can be fastened, either upon accused Madan Lal Mahajan (A-4) or upon Charan Jeet Arora (A-5).
55. The next contention of the prosecution has been that on the basis of forged and fabricated documents, bank officials sanctioned loans and enhanced DP of the company. The payments were not made to the suppliers of vehicles and the company utilized the amount to its own benefit. The DP ledger was maintained by the bank under the supervision of Pawan Kumar Gupta (A-6) (since deceased) and Kanwar Lal (A-7), who were working as accountants. The relevant period was 28.01.1988 to 29.01.1989 during which 13 vehicles were shown to be financed on the basis of forged documents. The vehicles have been identified as follows:
CBI Vs. Sushil Kumar Gupta & Ors. 60
• Vehicle No.DBL-9791 • Vehicle No.DBL-9792 • Vehicle No. DBL 155 • Vehicle No. DBL 9213 • Vehicle No.DBL-9139 • Vehicle No. DBL 156 • Vehicle No. DBL-579 • Vehicle No. DBL 9342 • Vehicle No. DBL 933 • Vehicle No. DBL 890 • Vehicle No.DBL 674 • Two vehicles without registration numbers.
56. During the investigation CBI has seized documents relating to the loans of these vehicles from the Corporation bank, Karol Bagh and from New Bank of India, L-Block, Connaught Place and also from the office of transport department, New Delhi. The seizure has been from respective officials through properly drawn seizure memos showing that documents are brought on record from their genuine sources.
57. On scrutiny of the testimony of various witnesses and the documents brought in evidence, my findings with respect to the above mentioned vehicles is as follows:
Vehicle No.DBL-9791:-
58. The agreement dated 26.03.1988 (Ex.PW-3/D) (D-118) CBI Vs. Sushil Kumar Gupta & Ors. 61 executed between K.B. Gupta [Managing Director of M/s PFLL], Pratap Singh (PW-2), Kuldip Singh (PW-3), Tilak Raj (PW-13) shows that vehicle (Swaraj Mazada) was purchased by PW-2 Pratap Singh through M/s PFLL and financed from Corporation Bank, Karol Bagh Branch, New Delhi. The agreement stands proved by the above witnesses by proving their signatures thereupon. This part of evidence has not been brought in question by defence as no cross-
examination of witnesses were conducted.
59. It is further evident that vide sale letter Mark D, lease agreement Ex.PW-5/D, irrevocable power of attorney (Ex.PW-5/E) etc. (D-124), PFLL has shown to have re-purchased vehicle No.9791 from Pratap Singh and further shown to be leased in favour of Pankaj Motors Pvt. Ltd.(PMPL). However, PW-2 Pratap Singh categorically stated that the vehicle was sold by him to a company at Naya Bazar and same was not sold to M/s PFLL . The witness has denied his signatures on sale letter dated 03.01.1989 (Mark D). PW- 44 Harpal Singh s/o Dilip Singh has stated that in the year 1989 he purchased truck No.9791 and made entire payment in cash without taking any loan. The payments with respect to vehicle was made to Kuldip singh s/o Pratap Singh. The vehicle was also got registered in his name and insurance was also taken.
CBI Vs. Sushil Kumar Gupta & Ors. 62
60. In the face of above said documents and statements of witnesses, it is clear that vehicle No.DBL 9791 was initially financed by PFLL in favour of Pratap Singh in the year 1988 but thereafter the same was never sold back to M/s PFLL by Pratap Singh. The sale letter showing sale of vehicle to M/s PFLL on payment is fabricated. The documents seized from the bank(D-124) clearly show that M/s PFLL put forth the sale letter and lease agreement Ex.PW-5/D and accompanying documents i.e. irrevocable power of attorney Ex.PW-5/E, agreement Ex.PW-5/F to avail funds from the bank illegally. The company [M/s PFLL ] was not in a position to finance the vehicle DBL-9791 further in favour of M/s PMPL as M/s PFLL was not the owner in possession of the vehicle in question.
61. It is proved in evidence that the lease agreement Ex.PW-5/D dated 10.01.1989 has been signed by K.B. Gupta, Managing Director on behalf of M/s PFLL and Narendra Kumar Gupta (A-2) on behalf of M/s PMPL, Manoj Kumar Gupta (A-3) as guarantor and Charan Jeet Arora (A-5) on behalf of the bank, knowingly that no genuine vehicle was being financed by this document. The transaction showing sale of vehicle vide sale letter Mark D had never taken place. The relevant witnesses have not been cross- CBI Vs. Sushil Kumar Gupta & Ors. 63 examined on behalf of defence and thereby their statements/testimonies have not be brought in question on behalf of accused persons.
62. The matter with respect to this vehicle was also investigated by PW-23 as a matter of in-house mechanism of the bank to detect the fraud. According to report Ex.PW-23/C, the vehicle DBL 9791 stands in the name of Pratap singh with the registration authority and thereby it has been concluded that sale letter dated 03.01.1989 (Mark D) is forged document.
63. The file seized from Transport authority D-62 pertain to vehicle No.DBL-9791. According to the record, the vehicle stood in the name of Pratap Singh and was at no point of time transferred to M/s. PFLL.
Conclusion
64. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing purchase and finance of vehicle No.DBL 9791 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No.DBL-9792:-
65. The agreement dated 26.03.1988 Ex.PW-3/D (D-118) executed CBI Vs. Sushil Kumar Gupta & Ors. 64 between K.B. Gupta [Managing Director of M/s PFLL], Pratap Singh (PW-2), Kuldip Singh (PW-3), Tilak Raj (PW-13) shows that vehicle (Swaraj Mazada) was purchased by PW-3 Kuldip Singh through M/s PFLL and financed from Corporation Bank, Karol Bagh. The agreement stands proved by the above witnesses by proving their signatures thereupon. This part of evidence has not been brought in question by defence as no cross-examination of witnesses on this point was conducted.
66. It is further evident that vide sale letter Mark C, lease agreement Ex.PW-30/87 (D-123), irrevocable power of attorney (Ex.PW-30/89), agreement Ex.PW-30/90, Company (PFLL) has shown to have re-purchased vehicle No.9792 from Kuldip Singh and further shown to be leased in favour of Pankaj Motors Pvt. Ltd. However, PW-3 Kuldip Singh categorically stated that the vehicle was sold by him to a transport company at Naya Bazar and same was not sold to M/s PFLL. PW-3 Kuldip singh, has denied his signatures on sale letter dated 04.01.1989 (Mark C). During cross-examination, the witness categorically denied that he is intentionally not identifying the signatures on Mark C, however, admitted that finance company got his signatures on blank documents. Defence has not given any suggestion to the witness that he has not purchased any such CBI Vs. Sushil Kumar Gupta & Ors. 65 vehicle or that he has deposed falsely and thereby the testimony of PW-3 has not been challenged. PW-9 Harcharan Singh s/o Dilip Singh has also stated that in the year 1989 he purchased truck No.9792 from Kuldip Singh and made entire payment in cash without taking any loan. The vehicle was also got registered in his name and insurance was also taken.
67. In the face of above said documents and statements of witnesses, it is clear that vehicle No.DBL 9792 was initially financed by PFLL in favour of Kuldip Singh in the year 1988 but thereafter the same was never sold back to M/s PFLL by Kuldip Singh. The sale letter showing sale of vehicle to M/s PFLL on payment is fabricated. The documents seized from the bank(D-123) clearly show that M/s PFLL put forth the sale letter Mark C, lease agreement Ex.PW- 30/87 and accompanying documents i.e. irrevocable power of attorney Ex.PW-30/89, agreement Ex.PW-30/90 to avail funds from the bank illegally. The company (M/s PFLL] was not in a position to finance the vehicle DBL9792 further in favour of M/s PMPL as M/s PFLL was not the owner in possession of the vehicle in question.
68. It is proved in evidence that the lease agreement Ex.PW-30/87 dated 09.01.1989 has been signed by K.B. Gupta, Managing Director on behalf of M/s PFLL and Narendra Kumar Gupta (A-2) on CBI Vs. Sushil Kumar Gupta & Ors. 66 behalf of M/s PMPL, Manoj Kumar Gupta (A-3) as guarantor and Charan Jeet Arora (A-5) on behalf of bank knowingly that no genuine vehicle was being financed by this document. The relevant witnesses have not been cross-examined on behalf of defence and thereby their statements/testimonies have not be brought in question. The transaction showing sale of vehicle vide sale letter Mark C had never taken place.
69. The matter with respect to this vehicle was also investigated by PW-23 as a matter of in-house mechanism of the bank to detect the fraud. According to Ex.PW-23/D, the vehicle DBL 9792 stands in the name of Kuldip Singh with the registration authority and thereby it has been concluded that sale letter dated 04.01.1989 (Mark C) is a forged document.
70. The file seized from Transport authority D-139 pertain to vehicle No.DBL-9792. According to the record, the vehicle stood in the name of Kuldip Singh and no sale letter or documents of sale are available in the file.
Conclusion:
71. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing purchase and finance of vehicle No.DBL 9792 is without any legal basis. The CBI Vs. Sushil Kumar Gupta & Ors. 67 documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No. DBL 155
72. According to the agreement dated 01.03.1988 (D-115), the vehicle Eicher Truck was purchased by Shivender Singh. The guarantor to the said agreement was Brij Mohan (PW-39). The vehicle has been financed from Corporation Bank through PFLL (whereby Credit Limit of Rs.25 lakhs was enjoyed by the Company PFLL). The agreement Ex.PW-30/110 (D-115) (seized from Corporation Bank) stands proved with the examination of PW-39.
73. It is further evident that vide sale letter dated 02.01.1989 and lease agreement Ex.PW-30/81 (D-122), the vehicle has been shown to have been repurchased by PFLL from Shivender Singh and further shown to be leased in favour of PMPL.
74. However, according to the file seized from Transport authority D-60 pertaining to vehicle No.DBL-155, the vehicle stood in the name of Shivender Singh and was at no point of time transferred to M/s. PFLL. There is no material on record to suggest that the same is repurchased by the PFLL in June 1989. The file contains a letter from PFLL dated 15.04.1991, whereby they have given no objection for cancellation of hypothecation clause in registration certificate. CBI Vs. Sushil Kumar Gupta & Ors. 68 The sale letter dated 02.01.1989 showing sale of vehicle to M/s PFLL on payment is fabricated accordingly.
75. The matter with respect to this vehicle was also investigated by PW-23 as a matter of in-house mechanism of the bank to detect the fraud. According to report Ex.PW-23/E, the vehicle DBL-155 stands in the name of Shivender Singh with the registration authority and thereby also it has been concluded that sale letter dated 02.01.1989 is a forged document. According to the form No.35, Shivender Singh stood owner of vehicle even on 15.04.1991, making it clear that lease agreement shown by PFLL in favour of PMPL is forged and fabricated.
76. The documents seized from the New Bank of India (D-122) clearly show that M/s PFLL put forth the sale letter and lease agreement Ex.PW-30/81 and accompanying documents i.e. irrevocable power of attorney Ex.PW-30/83, agreement Ex.PW-30/84 and receipt Ex.Pw-30/85 to avail funds from the bank illegally. The company (M/s PFLL) was not in a position to finance the vehicle DBL-155 further in favour of M/s PMPL as M/s PFLL was not the owner in possession of the vehicle in question. It is proved in evidence that the lease agreement Ex.Pw-30/81 dated 09.01.1989 has been signed by K.B. Gupta, Managing Director on behalf of M/s CBI Vs. Sushil Kumar Gupta & Ors. 69 PFLL and Narendra Kumar Gupta (A-2) on behalf of M/s PMPL, Manoj Kumar Gupta (A-3) and Charan Jeet Arora (A-5) knowingly that no genuine vehicle was being leased by this document. The transaction showing sale of vehicle vide sale letter dated 02.01.1989 had never taken place.
Conclusion
77. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing purchase and finance of vehicle No.DBL-155 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No. DBL 9213
78. The vehicle (Eicher Truck) was purchased through agreement Ex.PW-12/A by Ram Pal and Kanwar Sen. The agreement has been proved with the unrebutted testimony of PW-12, Sanjeev Gambhir who signed the agreement as a witness. The vehicle has been financed from Corporation Bank through PFLL whereby Credit Limit of Rs.25 lakhs was enjoyed by the Company PFLL. The agreement Ex.PW-12/A dated 13.02.1988 was seized from Corporation Bank.
79. It is evident from the letters dated 11.01.1989 and agreement also dated 11.01.1989 Ex.PW-30/101 (D-126) that the vehicle DBL- CBI Vs. Sushil Kumar Gupta & Ors. 70 9213 has been shown to be leased in favour of PMPL. The lease agreement Ex.PW-30/101 and other documents i.e. irrevocable power of attorney Ex.PW-30/103, agreement Ex.PW-30/104 and receipt Ex.PW-30/105 have been proved with the testimony of PW- 46 Rita Gulati @ Jyoti, who was working as Steno/typist with PFLL. There is no document showing that the vehicle was repurchased by PFLL from the registered owners namely Rampal and Kanwar Sen.
80. According to the file seized from Transport authority Ex.PW- 25/B (D-58) pertaining to vehicle No.DBL-9213, the vehicle stood in the name of Ram Pal & Kanwar Sen, and was at no point of time transferred to M/s. PFLL. The file Ex.PW-25/B contains a letter from PFLL with respect to the termination of hire purchase agreement from Registration Book. According to this letter, Ram Pal and Kanwer Sen were the registered owners of the vehicle till January 1993.
81. The matter with respect to this vehicle was also investigated by PW-23 as a matter of in-house mechanism of the bank to detect the fraud. According to report Ex.PW-23/B, the vehicle DBL-9213 stood in the name of Ram Pal and Kanwar Sen with the registration authority.
CBI Vs. Sushil Kumar Gupta & Ors. 71 Conclusion
82. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing lease of vehicle No.DBL-9213 in January 1989 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No.DBL-9139:-
83. Vide agreement dated 01.02.1988 (Ex.PW-30/107) Eicher Truck was purchased by PW-40 Surender Singh for his company M/s J.S. Tareja transport Company through M/s PFLL. The guarantor to the said agreement was Digvijay Singh (PW-53). The agreement stands proved by the above witnesses by proving their signatures thereupon. The vehicle has been financed from Corporation Bank through PFLL whereby Credit Limit of Rs.25 lakhs was enjoyed by the Company PFLL.
84. It is evident from the letters dated 10.01.1989 and agreement also dated 10.01.1989 Ex.PW-15/1 (D-125) that the vehicle DBL-9139 has shown to be leased in favour of PMPL. The lease agreement Ex.PW-15/1 and other documents i.e. irrevocable power of attorney Ex.PW-30/97, agreement Ex.PW-30/98 and receipt Ex.PW-30/99 have been proved with the testimony of PW-15 CBI Vs. Sushil Kumar Gupta & Ors. 72 Ms. Renuka, who was working with PFLL. There is no document showing that the vehicle was repurchased by PFLL from the registered owner. The company [M/s PFLL ] was not in a position to finance the vehicle DBL-9139 further in favour of M/s PMPL as M/s PFLL was not the owner in possession of the vehicle in question.
85. The matter with respect to this vehicle was also investigated by PW-23 as a matter of in-house mechanism of the bank to detect the fraud. According to his report Ex.PW-23/A, the vehicle DBL 9139 stands in the name of Surender Singh with the registration authority.
86. According to the file seized from Transport authority D-62 pertaining to vehicle No.DBL-9139, the vehicle stood in the name of Surender Singh and at no point of time it was transferred to M/s. PFLL.
Conclusion The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing lease of vehicle No.DBL 9139 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank. Vehicle No. DBL 156:
87. According to the agreement dated 01.03.1988 (D-114), CBI Vs. Sushil Kumar Gupta & Ors. 73 the vehicle was purchased from PFLL by Ved Prakash (PW-1). The guarantor to the said agreement was Janak Raj Bhatia (PW-11). The vehicle has been financed from Corporation Bank through PFLL whereby Credit Limit of Rs.25 lakhs was enjoyed by the Company PFLL. The agreement Ex.PW-11/A was seized from Corporation Bank through his officers and stands proved with the examination of PW- 1 & PW-11.
88. It is evident from the letters dated 07.01.1989 and agreement also dated 07.01.1989 Ex.PW-30/72 (D-120) that the vehicle DBL-156 has been shown to be leased in favour of Vivek Kumar Aggarwal (PW-50). The lease agreement Ex.PW-30/72 (Ex.PW-5/A) and other documents i.e. irrevocable power of attorney Ex.PW-5/B, agreement Ex.PW-5/C and promissory note Ex.PW-30/73 have been proved with the testimony of PW-5 Ms.Anita Malhotra, who was working as Stenographer with PFLL. Ved Prakash (PW-1) was the registered owner of said vehicle and there is no document showing that the vehicle was repurchased by PFLL from the registered owner.
89. According to the file seized from Transport authority D-59 pertaining to vehicle No.DBL-156, the vehicle stood in the name of Ved Prakash and was at no point of time transferred to M/s. PFLL. CBI Vs. Sushil Kumar Gupta & Ors. 74 On 08.03.1991, form No. 35, signed by S.K. Gupta, Director of PFLL for termination of H.P.A.
90. The matter with respect to this vehicle was also investigated by PW-23 as a matter of in-house mechanism of the bank to detect the fraud. According to his report Ex.PW-23/G, the vehicle DBL-156 stands in the name of Ved Prakash with the registration authority.
91. PW-50 Vivek Kumar Aggarwal deposed that he was employed with M/s PFLL as recovery officer. He has no knowledge about cash credit limit of the company. He admitted the suggestion given on behalf of prosecution that M/s PFLL was also having sister concerns namely Pankaj Motors, Sanjay Finance, Pankaj Finance and some other companies. The witness used to sign the documents pertaining to loan agreements as and when asked to do so by CMD and director. The witness further stated that Sushil Kumar Gupta (A-
1) used to fill in the forms and other documents on which he was asked to sign. He denied having purchased the vehicle DBL-156. He signed the relevant agreement etc. at the instance of Managing Director K.B. Gupta. He denied the suggestion that accused Sushil Kumar Gupta (A-1) has asked him to sign these documents. The witness had no knowledge about the ownership and possession of CBI Vs. Sushil Kumar Gupta & Ors. 75 vehicle No.DBL-156 and about tripartite agreement.
92. On reading the above evidence, it is clear that vehicle No.DBL-156 was neither purchased by M/s PFLL from Ved Prakash nor sold to Vivek Aggarwal on lease as shown. The clear conclusion comes out that the documents executed including tripartite agreement etc. are forged and fabricated.
Conclusion
93. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing lease of vehicle No.DBL-156 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank. Vehicle No. DBL-579:
94. The vehicle is matador and according to evidence of Arvind Kumar Goel (PW-29), he purchased the said vehicle and got it financed from Oriental Bank of Commerce Shahdara in March 1988. He also identified papers submitted with RTO office (D-63) Ex.PW-29/A to Ex.PW-29/E. The witness further stated that he liquidated the loan which was obtained from Oriental Bank of Commerce, Shahdara. Therefore, it is clear from the testimony of PW-29 and documents Ex.PW-29/A to Ex.PW-29/E that Arvind Kumar Goel (PW-29) has been the registered owner of vehicle. CBI Vs. Sushil Kumar Gupta & Ors. 76
95. However, the company M/s PFLL has shown that vehicle DBL-579 has been leased/financed in the favour of Pankaj Motors Pvt. Ltd.(M/S PMPL). The lease agreement so executed has been proved as Ex.PW-30/75 with the testimony of Smt. Rita Gulati (PW-
46), (employee of PFLL). It is clear from the above evidence that at no point of time vehicle came under the ownership or possession of company M/s PFLL and therefore, company was not in position to finance the same in favour of M/s PMPL.
96. The lease agreement dated 09.01.1989 Ex.PW-30/75 (D-
121), Ex.PW-30/76 Irrevocable Power of attorney Ex.PW-30/77, agreement Ex.PW-30/78 and promissory note Ex.PW-30/79 are forged and fabricated having been signed by the director K.B. Gupta on behalf of PFLL, Narendra Kumar Gupta (A-2) and Manoj Kumar Gupta (A-3) on behalf of PMPL knowingly that no such vehicle was being financed thereof. The agreement Ex.PW-30/78 was processed and approved by Charan Jeet Arora (A-5) on behalf New Bank of India.
97. The matter with respect to this vehicle was also investigated by PW-23 as a matter of in-house mechanism of the bank to detect the fraud. According to his report Ex.PW-23/F, the CBI Vs. Sushil Kumar Gupta & Ors. 77 vehicle DBL-579 stands in the name of Arvind Kumar Goel with the registration authority till November 1989.
Conclusion
98. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing lease and finance of vehicle No.DBL-579 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No. DBL 9342
99. According to the statement of PW-10 Naina Verma, Director of M/s Hind Proofing Company (P) Ltd., the vehicle DCM Toyota was leased vide lease agreement dated 28.01.1988 Ex.PW- 10/A (D-130) by M/s PFLL in favour of company M/s Hind Proofing Co.(P) Ltd. Other documents like irrevocable power of attorney, agreement and promissory note etc. so executed with PFLL have been proved as Ex.PW-10/B, Ex.PW-10/C & Ex.PW-10/D. The witness further stated that the vehicle remained with the company till 1993 and at no point of time sold to Geeta Bakshi. During cross- examination witness stated that vehicle was sold by the company in 1994-95.
CBI Vs. Sushil Kumar Gupta & Ors. 78
100. However, the company M/s PFLL has shown the vehicle as leased/financed to Ms. Geeta Bakshi vide Letter Ex.PW-30/3 (D-
129), lease agreement dated 28.01.1988 Ex.PW-26/A, Ex.PW-30/B, agreement Ex.PW-30/9, Irrevocable Power of Attorney Ex.PW-30/10. Although in the above documents number of vehicle has not been mentioned but they are accompanied by copy of Registration Certificate Ex.PW-30/30 of Toyota DBL 9342. Satbir Singh (PW-26) has signed the agreement as guarantor for purchasing DCM Toyota at the instance of Ajay Bakshi husband of Geeta Bakshi, but subsequently he was informed that no vehicle was delivered by company and also the company refused to return the documents.
101. According to the file seized from Transport authority D-62 pertaining to vehicle No.DBL-9342, it is evident that vehicle was in the name of Hind Proofing Company and PFLL was not in a position to sell or finance the said vehicle in favour of Geeta Bakshi. According to the affidavit Ex.PW-10/E, stamp paper dated 17.07.1991, the vehicle stood with M/s Hind Proofing Company (P) Ltd.
Conclusion
102. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing lease and CBI Vs. Sushil Kumar Gupta & Ors. 79 finance of vehicle No.DBL-9342 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No. DBL 933
103. The vehicle is Eicher Mini Truck and according to the documentary evidence produced by prosecution, the vehicle is financed through PFLL on 10.06.1988 from New Bank of India, L- Block, Connaught Circus, New Delhi. The agreement dated 10.06.1988 Ex.PW-33/A (D-135) stands proved with the unrebutted and uncontroverted evidence of Gulshan Kumar Rajpal (PW-33). Also the same vehicle has been shown as financed in April 1988 in favour of Narendra Kumar Gupta of M/s PMPL.
104. On the basis of agreement dated 11.04.1988 Ex.PW- 30/59 (D-131) the vehicle is shown to have been financed in favour of Narendra Kumar Gupta (A-2) of PMPL and drawing power was got enhanced from New Bank of India.
105. It is not possible that vehicle is financed in favour of two persons on two occasions that too within a span of only two months. It has also come in evidence that Narendra Kumar Gupta (A-2) has been related to K.B. Gupta, managing director of PFLL and both of them have been holding PMPL together till 1990. CBI Vs. Sushil Kumar Gupta & Ors. 80 Conclusion
106. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing purchase and finance of vehicle No.DBL-933 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No. DBL 890
107. The vehicle is Eicher Canter and according to evidence of Gupteshwar Singh (PW-7), he purchased the said vehicle through financed from M/s PFLL in May 1988. He also identified the documents i.e. lease agreement dated 25.05.1988 Ex.PW-7/A, power of attorney Ex.PW-7/B, Agreement Ex.PW-7/C, Promissory Note Ex.PW-7/D. It is clear from the testimony of PW-7 and above documents that Gupteshwar Singh (PW-7) has been the registered owner of vehicle and the vehicle was financed from New Bank of India through M/s PFLL.
108. According to the file seized from Transport authority D-54 pertaining to vehicle No.DBL-890, it is evident that vehicle was registered in the name of Gupteshwar Singh.
109. Although in the documents Ex.PW-7/A to Ex.PW-7/D CBI Vs. Sushil Kumar Gupta & Ors. 81 registration number of vehicle has not been mentioned, but chassis number and engine number mentioned therein is matched with the file No.D-54 seized from transport authority, wherein registration number of DBL-890 and make Eicher Mitsubishi with its Chassis and Engine Number was recorded.
110. However, the company M/s PFLL has shown that vehicle has been financed in the favour of Manoj Kumar Gupta on 18.04.1988. The lease agreement so executed has been proved as Ex.PW-30/52 (D-133). It is clear from the above evidence that PW-7 was the registered owner of the vehicle and he got it financed from New Bank of India through PFLL and at no point of time vehicle came under the ownership or possession of company M/s PFLL and therefore, company was not in position to finance the vehicle in favour of Manoj Kumar Gupta (A-3).
111. The lease agreement dated 18.04.1988 Ex.PW-30/52 (D-
133), Ex.PW-30/53 Irrevocable Power of attorney Ex.PW-30/53, agreement Ex.PW-30/55 and promissory note Ex.PW-30/56 are forged and fabricated having been signed by the Managing director K.B. Gupta on behalf of PFLL and Manoj Kumar Gupta (A-3) knowingly that no such vehicle was being financed thereof. PW-37 in his testimony stated that receipt dated 18.04.1988 Mark 37/11 CBI Vs. Sushil Kumar Gupta & Ors. 82 does not seem to be genuine as it is issued on a letterhead and not on prescribed computer format.
Conclusion
112. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing purchase and finance of vehicle No.DBL-890 is without any legal and valid basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
Vehicle No.DBL 674
113. According to the agreement dated 16.05.1988 (D-136), the vehicle was purchased from PFLL by Rajender Giri (PW-4) vide lease agreement Ex.PW-4/A, irrevocable power of attorney Ex.PW- 4/B, agreement Ex.PW-4/C and promissory note Ex.PW-4/D. The vehicle has been financed from New Bank of India through PFLL. The agreement dated 16.05.1988 Ex.PW-4/A, irrevocable power of attorney Ex.PW-4/B, agreement Ex.PW-4/C and promissory note Ex.PW-4/D stand proved with the unrebutted and uncontroverted testimony of Rajender Giri (PW-4).
114. However, on the basis of lease agreement dated 11.04.1988 Mark X-4, agreement Mark X-1 and promissory note Mark X-2, the vehicle is shown to have been financed to Ramesh CBI Vs. Sushil Kumar Gupta & Ors. 83 Gupta s/o Banarsi Das by PFLL, whereas PW-6 Ramesh Chand S/o Banarsi Lal deposed that he never took the loan through PFLL from New Bank of India and denied his signatures on Mark X-1, X-2 & X-4. Name and identity of Ramesh Chand (PW-6) has been used to forge the documents showing finance of the vehicle owned by Rajender Giri. This fact has also been confirmed by PW-16 Devi Dayal Gupta who has also denied his signatures on pronote Ex.PW-16/2 and tripartite agreement Ex.PW-16/1. He has categorically denied that he has stood as guarantor. On the basis of this agreement, drawing power was got enhanced from New Bank of India.
115. It is not possible that vehicle is financed in favour of two persons on two occasions that too within a span of only two months. It has come in evidence that Ramesh Chand (PW-6) and Devi Dayal Gupta (PW-16) were known to Sushil Kumar Gupta, director of PFLL.
Conclusion
116. The overall analysis of the above evidence leads to the clear conclusion that amount withdrawn on showing lease and finance of vehicle No.DBL-674 is without any legal basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
CBI Vs. Sushil Kumar Gupta & Ors. 84 Vehicles not existed:-
117. It is further evident from the documents i.e. letter Ex.PW- 30/45 & Ex.PW-30/46, lease agreement Ex.PW-30/47, Promissory note Ex.PW-30/48, agreement Ex.PW-30/49 (D-127) and letters Ex.PW-30/19 to Ex.PW-30/22, lease agreement Ex.PW-30/23 & Ex.PW-30/24, irrevocable power of attorney Ex.PW-30/25, agreement Ex.PW-30/18 and promissory note Ex.PW-30/30 (D-128) that non-existing vehicles have been shown as leased in the name of Balvinder Singh and Praveen Grover. These documents do not bear the engine number and chassis number and therefore it is clear that they do not pertain to genuine vehicles.
118. The overall analysis of the above documents leads to the clear conclusion that amount withdrawn on showing finance of these non-existing vehicles is without any legal and valid basis. The documents concerned are forged in order to avail the monetary benefit from the bank.
119. Ex.PW-31/A (brought in evidence) is the register maintained with respect to Drawing Power by PFLL. It is proved that on the basis of abovenoted forged agreements, DP was enhanced and funds released making the offence of cheating complete.
CBI Vs. Sushil Kumar Gupta & Ors. 85
120. The witnesses examined by prosecution pertaining to above vehicles are neutral and independent and have no reason to depose falsely. They are credible and truthful witnesses. Even defence has not put up much challenge to their testimony evidence as there is no substantial cross-examination of the witnesses.
121. The scope and ambit of forgery defined u/s 463 & 464 IPC is wide enough and includes an act of making false document fraudulently without any authority. The forged agreements, irrevocable power of attorney and related documents etc. have been signed by K.B. gupta, Managing Director (since deceased) on behalf of PFLL and Narendra Kumar Gupta (A-2) Managing Director of PMPL and Manoj Kumar Gupta (A-3) as guarantor on behalf of PMPL. It has also come in evidence that all the above persons have been related to each other and companies PFLL and PMPL have been sister concerns acting in collusion. Their collusion and conspiracy is writ large as they acted in concert and complicity. The act of signing these documents by above named persons without their being any authority (concerning the vehicles in question), falls within the offence of forgery and same is well established and proved by prosecution.
122. I have also given due consideration to the defence pleas CBI Vs. Sushil Kumar Gupta & Ors. 86 taken in this regard.
123. It is pleaded by Sushil Kumar Gupta (A-1) that he has not been managing the affairs of the company PFLL and has not signed any of the forged agreements or related documents. No witness has deposed that Sushil Kumar Gupta (A-1) was dealing with bank concerning CCL or submitting false documents. Otherwise also there is no evidence that Sushil Kumar Gupta (A-1) knowingly submitted false documents before the bank. Also since no charge has been framed against the company, the vicarious liability cannot be fastened against Sushil Kumar Gupta (A-1) by virtue of being its director.
124. On examining the oral as well as documentary evidence, appearing on record, I find that Sushil Kumar Gupta (A-1) has been involved in the commission of the offences directly as well as by way of conspiracy thereof. It is true that on most of the forged papers/agreements, the signatures of managing director K.B. Gupta are appearing but this fact does not itself absolve Sushil Kumar Gupta (A-1), who was also the whole time director of PFLL. There is convincing and clear evidence on record proving that accused Sushil Kumar Gupta (A-1) has been deeply involved in the conspiracy for committing the offences of cheating and forgery. The CBI Vs. Sushil Kumar Gupta & Ors. 87 relevant witnesses in this regard are PW-35 Ms. Alka Chopra, PW-46 Smt. Rita Gulati, PW-48 Sanjeev Kumar Tiwari, PW-50 Vivek Kumar Aggarwal and PW-54 Satish Malik.
125. According to the statement of PW-35 Ms. Alka Chopra who has been receptionist in the office of PFLL, she signed lease agreement Ex.PW-26/A, Agreement Ex.PW-30/9, irrevocable power of attorney Ex.PW-30/10 whereby vehicle make DCM Toyota was financed in favour of Geeta Bakshi on 28.01.1988. She has also identified signatures of Sushil Kumar Gupta (A-1) on lease agreement of Ex.PW-26/A (D-129) at points Q5, Q5(c), Q5(d), Q5(e), Q5 (f), Q5(h) & Q5(i), which is also supported by the expert opinion Ex.PW-30/292.
126. PW-46 Rita Gulati has also been employee of PFLL. She stated that K.B. Gupta was the Managing Director and S.K. Gupta (A-1) was the director. She used to sign the documents at the instance of managing director as well as director PFLL. She has identified her signatures on forged papers Ex.PW-30/75 and categorically stated that she used to sign at the instance of director as well as managing Director. There has been no substantial cross- examination of this witness on behalf of accused Sushil Kumar Gupta (A-1) and no suggestion has been put to her that Sushil CBI Vs. Sushil Kumar Gupta & Ors. 88 Kumar Gupta never asked her to sign any papers. The complicity of accused Sushil Kumar Gupta (A-1) is clear and there is no reason to disbelieve this witness.
127. PW-48 Sanjeev Kumar Tiwari was working as accounts officer with PFLL. He stated that pages/forms of lease agreement and irrevocable power of attorney etc. were filled by him on the instructions of Sushil Kumar Gupta (A-1) as he was his immediate boss. The witness also stated that generally the agreements and related papers were filled by accused Sushil Kumar Gupta himself and at times on his instructions by other staff members. The form Ex.PW-30/85 filled up by the witness on the instructions of Sushil Kumar Gupta and was also signed by him as witness. During cross- examination witness admitted that he had not stated these facts in his statement recorded u/s 161 CrPC but asserted that he has deposed truthfully before the IO and denied the suggestion that he has been deposing falsely in order to falsely implicate accused Sushil Kumar Gupta.
128. The witness (PW-48) is natural and probable witness and no strong motive could attributed to him for giving false evidence despite lengthy cross-examination. In my opinion the truthfulness of the witness could not be impeached by the defence. CBI Vs. Sushil Kumar Gupta & Ors. 89
129. It is further clear from the testimony of PW-50 Vivek Kumar Aggarwal also an employee of PFLL that Managing Director K.B. Gupta and Sushil Kumar Gupta, director of the company were relatives. M/s PFLL was having Pankaj Motors as its sister concern and also some other companies. The witness further stated that he used to sign documents pertaining to loan agreements at the instance of CMD and director. Accused Sushil Kumar Gupta and others used to fill in the forms and other documents. The lease agreement Ex.PW-30/72 has been signed by him at the instance of Managing Director K.B. Gupta. Similarly, he signed Ex.PW-30/87 at the instance of K.B. Gupta. The witness denied to be deposing falsely. PW-50 has not been cross-examined on behalf of Sushil Kumar Gupta and therefore, the statement of the witness that Sushil Kumar Gupta used to fill the forms of loan agreements and other documents has gone uncontroverted.
130. PW-54 Satish Malik has been one of the director of PFLL during the period 1985-1989. The witness also stated that company was managed by Managing Director K.B. Gupta and Sushil Kumar Gupta was the whole-time director. The witness has not been cross- examined on behalf of accused Sushil Kumar Gupta.
131. From the above evidence, it is clear that accused Sushil CBI Vs. Sushil Kumar Gupta & Ors. 90 Kumar Gupta (A-1) director of PFLL had full knowledge about the forgery of loan/lease agreements so committed to play fraud on the bank and on the basis of the same funds from cash credit limit were availed illegally. Also there is another strong evidence against accused Sushil Kumar Gupta (A-1) in the form of expert opinion Ex.PW-30/292 where his handwriting on forged documents Ex.PW- 30/3 at point [Q1 (a) & (b)], Ex.PW-30/4 [Q-2(a), 2 (b)] Ex.PW-30/5 [Q3 (a) & (b)] Ex.PW-30/6 [Q-4 (a)], Ex.PW-30/45 [at points Q-25
(a), Q-25(b)], Ex.PW 30/46 [Q-27(a)], Ex.PW-30/47 [Q29], Ex.PW- 30/48 [Q29 (a), Q 29 (b)], Ex.PW-30/19 [Q-10(a)], Ex.PW-30/23 [Q- 14 (a)], Ex.PW-30/27 [Q-14 9(u)] Ex.PW-30/30 [Q-14 (s), (t)] and signatures on documents Ex.PW-26/A (D-129) at points Q5, Q5(c), Q5(d), Q5(e), Q5 (f), Q5(h) & Q5(i), Ex.PW-30/23 [Q-14 (b) to (h)], Ex.PW-30/25 [Q-14 (j), (r)], Ex.PW-30/18 [Q-14 (l), (k), Ex.PW-30/27 [Q-14 (m)] stands proved.
132. The involvement of accused Sushil Kumar Gupta (A-1) is further clear from the testimony of PW6 Ramesh Chand and PW16 Devi Dayal Gupta as the names of these two persons have been misused and only Sushil Kumar Gupta was in a position to misuse their names being known to them as neighbours.
133. The accused Narendra Kumar Gupta (A-2) and Manoj CBI Vs. Sushil Kumar Gupta & Ors. 91 Kumar Gupta (A-3) on behalf of PMPL have argued that they have not been involved in illegalities. They only proposed to PFLL for purchasing vehicles which might have been misused by the managing director of PFLL.
134. The accused Narendra Kumar Gupta (A-2) and Manoj Kumar Gupta (A-3) have signed lease agreements and related papers on behalf of PMPL. It has already been held that said documents have been forged and fabricated. The vehicles belonging to other persons have been shown as leased and financed in favour of PMPL. According to testimony of PW-50 Vivek Kumar Aggarwal, PMPL has been sister concern of PFLL. The collusion of PMPL through its directors with PFLL is apparent and leaves no scope of doubt. It is clear that director of PMPL Narendra Kumar Gupta (A-2) in collusion of Manoj Kumar Gupta (A-3) have signed the agreements with full knowledge that the vehicles were not so financed. The pleas taken in defence by Narendra Kumar Gupta (A-2) and Manoj Kumar Gupta (A-3) have no merit or substance particularly when the vehicles have been shown as leased in their personal names even. I therefore conclude that offences punishable u/s 120 B IPC r/w 420, 467, 468, 471 IPC and also substantive offences punishable u/s 420, 467, 468, 471 IPC CBI Vs. Sushil Kumar Gupta & Ors. 92 are proved against Sushil Kumar Gupta (A-1). The offence of criminal conspiracy punishable u/s 120 B IPC r/w Section 468, 467, 471 and 420 IPC is clearly proved against accused Narendra Kumar Gupta (A-2) and Manoj Kumar Gupta (A-3). The above accused are liable in their individual capacity as directors of companies (PFLL & PMPL).
135. Coming to the role of public servants accused Madan Lal Mahajan (A-4), Charan Jeet Arora (A-5) and Kanwar Lal (A-7) are public servants and are being prosecuted under the Provisions of Prevention of Corruption Act. First and foremost requirement of prosecution is sanction under Section 19 of the Act. The law on the question of sanction has been deliberated by the Apex Court. In State of Maharashtra through CBI Vs. Mahesh G.Jain 9 and culled out the principles of law relating to sanction. The relevant portion of the said judgment is reproduced hereunder:
i. It is incumbent on the prosecution to prove that the valid sanction has been granted by the sanctioning authority after being satisfied that a case for sanction has been made out. ii. The sanction order may expressly show that the sanctioning authority has perused the material placed before him and, after consideration of the circumstances, has granted sanction for prosecution.
iii. The prosecution may prove by adducing the evidence that the material was placed before the sanctioning authority and 9 (2013) 8 SCC 119 CBI Vs. Sushil Kumar Gupta & Ors. 93 his satisfaction was arrived at upon perusal of the material placed before him.
iv. Grant of sanction is only an administrative function and the sanctioning authority is required to prima facie reach the satisfaction that relevant facts would constitute the offence. v. The adequacy of material placed before the sanctioning authority cannot be gone into by the court as it does not sit in appeal over the sanction order.
vi. If the sanctioning authority has perused all the materials placed before him and some of them have not been proved that would not vitiate the order of sanction.
vii.The order of sanction is a pre-requisite as it is intended to provide a safeguard to public servant against frivolous and vexatious litigants, but simultaneously an order of sanction should not be construed in a pedantic manner and there should not be a hyper-technical approach to test its validity.
136. PW-14 G.D. Golani and PW-21 S.K.Awasthi have granted sanction in the present case for prosecution against accused Madan Lal Mahajan (A-4), Charan Jeet Arora (A-5) and Kanwar Lal (A-7). I have examined the testimony of both the witnesses as well as orders granting sanction. It is clear that sanction has been granted by both the witnesses on the basis of documents received by them and therefore there was sufficient material with the sanctioning authority to evaluate issue of grant of sanction. The sanction order itself shows that it is passed with due application of mind and therefore I conclude that sanction has been properly granted. I do not find any meaningful defence taken by accused in this regard. The argument advanced on behalf of accused Madan Lal Mahajan CBI Vs. Sushil Kumar Gupta & Ors. 94 (A-4) that PW 14 was not competent to remove him and consequently he was not competent to grant sanction is of no relevance as no such plea was taken during the cross-examination of this witness as the witness was not given any suggestion as to his capacity to remove A-4 or to grant sanction.
137. The substantive offence against public servants is Section 13 (1) (d) of PC Act 1988. A bare reading of Section 13 (1)
(d) of the Act would go to show that the offence contemplated therein is committed if a public servant obtains for himself or any other person any valuable thing or pecuniary advantage by corrupt or illegal means; by abusing his position as public servant or without any public interest. The aforesaid provision of the Act i.e. Section 13 (1) (d) are somewhat similar to the offence under Section 5 (1) (d) of the Prevention of Corruption Act, 1947.
138. In so far as the charge under Section 13 (1) (d) read with Section 13 (2) of the PC Act is concerned, the ingredients are:-
(a) that the accused should be a public servant;
(b)that he should use some corrupt or illegal means or otherwise abuse his position as a public servant;
(c) he should not have obtained a valuable thing or pecuniary advantage; and CBI Vs. Sushil Kumar Gupta & Ors. 95
(d)for himself or any other person and we have already noted the materials placed by the prosecution to substantiate for the abovesaid offence.
139. Coming back to the case, matter relates to sanction of cash credit limit and mis-utilization of funds. It is not disputed that PFLL was enjoying cash credit limit of Rs.200 lakhs. The duty of the bank is not over merely on sanction of cash credit limit as bank needs to ensure end-use of funds for the prescribed purpose. It can be done by:
• Meaningful scrutiny of quarterly progress reports, operating statements, balance sheet of borrower • Regular inspection of borrower's assets charged to the bank as security • Periodical scrutiny of borrower's books of accounts etc. • the bank should keep a watch on the operation of the accounts to check the diversion of funds.
140. In their defence accused Madan Lal Mahajan (A-4) and Charan Jeet Arora (A-5) stated that it is a false and fabricated case without any iota of truth and they have been falsely implicated in this case. Accused Kanwar Lal (A-7) in his defence stated that it is false case registered against him and IO has not done fair investigation. He stated that he is having 80% disability. It is submitted that prosecution failed to prove any mens rea or illegal CBI Vs. Sushil Kumar Gupta & Ors. 96 motive against him and as per the statement of PW-47, he had no authority to sanction the loan or to release the DP being the management trainee at that time.
141. I have duly examined the role of Madan Lal Mahajan (A-
4), who has been working as Senior Manager of the branch from 28.10.1985 to 24.06.1989. There is no doubt that day to day operation of account (CCL) was to be looked after by the branch. Accordingly, it was the duty of manager to conduct proper checking of documents before releasing the loan. It has come in evidence that accused Madan Lal Mahajan (A-4) was Senior Manager and accused Charan Jeet Arora (A-5) was manager (loans). Only two out of thirteen forged agreements and related documents have been signed by Madan Lal Mahajan (A-4) and further there is no evidence that he has taken any pecuniary advantage from PFLL or from any of its sister concerns. Considering that Charan Jeet Arora (A-5) being manager (loans) had the specific duties to check and control the transactions under cash credit limit and he only was signing most of the agreements on behalf of bank and accused Madan Lal Mahajan (A-4) was only having supervisory powers that too general in nature and had to oversee overall functioning of the branch, in my opinion, benefit of doubt must be given to Madan Lal Mahajan CBI Vs. Sushil Kumar Gupta & Ors. 97 (A-4). It is not proved beyond reasonable doubt that two agreements (relating to vehicles DBL-674 & DBL-933) were signed by senior manager knowing the same to be forged. No undue advantage or misuse of official position has been established against accused Madan Lal Mahajan (A-4).
142. Considering the role of Charan Jeet Arora (A-5), Manager (loans), he was working as manager (loans) during the period in question and was there till June 1989. The tripartite agreements relating to 13 (thirteen) vehicles mentioned above have been forged and fabricated out of which 11 (eleven) agreements have been signed by Charan Jeet Arora (A-5) on behalf of bank. It is testified by PW-32 S.C. Jain, Manager that it was the duty of manager to conduct scrutiny of documents before releasing the loan. The investigation conducted by this witness has resulted into submission of report Ex.PW-32/A, whereby it is concluded that the branch has accommodated the party (PFLL) over and above the DP and secondly the account was always overdrawn i.e more than DP. During the cross-examination of this witness, no suggestion has been given that manager was not under any obligation to scrutinize the papers relating to finance of vehicles.
CBI Vs. Sushil Kumar Gupta & Ors. 98
143. The forgery of loan documents have been committed by PFLL during the period 28.01.1988 to 29.01.1989 and such frequent illegalities would not have been possible without collusion of bank officer. The nature of duties of accused Charan Jeet Arora (A-5) being manager (loans) has been specific and focused towards loans only which included checking of cash credit limit accounts. Therefore, accused Charan Jeet Arora (A-5) is not in a position to escape from responsibility by pleading that he signed the documents under the presumption that they were duly executed. It has come in evidence that only after signing the agreements, accountants used to release DP. It is also important to note that registration certificates about transfer of ownership of vehicles were not obtained even after the release of drawing power. The collusion as well as misuse of official position is further clear in respect of accused Charan Jeet Arora (A-5) as the amount of Rs.4 lakhs by way of cheque has been credited to the account of company M/s Vishal Super Insulation. It is proved in evidence that company has been owned and controlled by the relatives of accused Charan Jeet Arora (A-5). It is categorically stated by PW-8 Ashok Kumar Bakshi that PFLL had no business dealings with the firm M/s Vishal Super Insulation. He deposed that cheque was handed over to him by CBI Vs. Sushil Kumar Gupta & Ors. 99 accused Charan Jeet Arora (A-5), which was already signed and only pay in slips were filled by him. PW-8 also testified that check was cleared/passed by Charan Jeet Arora (A-5). No cross-examination of PW8 was conducted and therefore the testimony of PW-8 has not been challenged or rebutted on behalf of Charan Jeet Arora (A-5). The witness PW-8 has admitted that M/s Vishal Super Insulation was owned by sister and nephew of Charan Jeet Arora (A-5).This strong piece of evidence clearly establishes that accused Charan Jeet Arora (A-5) has been taking pecuniary benefits from PFLL and in lieu thereof signed the agreements knowingly that they were not valid and were forged as company was not in a position to finance those vehicles. The clearance of this cheque by Charan Jeet Arora (A-5) shows that he was having knowledge about cash credit facility being used for the purpose other than for which the same was sanctioned.
144. Arguments advanced in this respect that amount of Rs.2.5 lakh was credited subsequently in the account of M/s Vishal Super Insulation from PFLL is of no consequence and the same even if admitted does not in any way diminishes the criminality of the accused. Otherwise also, there is no material on record to substantiate this plea.
CBI Vs. Sushil Kumar Gupta & Ors. 100
145. Coming to the role of accused Kanwar Lal, he has been the management trainee in the bank working under Naresh Kumar Sehgal (PW-31). PW-31 Naresh Kumar Sehgal was working as Clerk and it was his duty to maintain DP register Ex.PW-31/B on the basis of tripartite agreements. PW 31 deposed that it was the duty of accountant to calculate DP but he had no role in verifying genuineness of the agreements and other documents. PW 31 further deposed that accused Kanwar Lal (A-7) was working with him as colleague and was trainee officer on probation. He could not say that accused Kanwar Lal (A-7) worked on DP register from 01.12.1987 to 02.03.1988. According to PW31 Naresh Kumar Sehgal, he used to make entries in DP register and Kanwar Lal (A-7) used to check the same. The witness did not make any comment as to whether on probation, official had no authority to sanction loan or to release DP. The registration certificates for all the vehicles used to generally come within a month and half after the entries were made in the DP register. He also could not comment that trainee officers were put on different seats for a month or two during their training but admitted that Kanwar Lal (A-7) worked with him only for a short period.
146. In view of evidence of PW 31, it is clear that accused CBI Vs. Sushil Kumar Gupta & Ors. 101 Kanwar Lal (A-7) was not handed over any work independently as he was under training and therefore was not in a position of any authority. Accused Kanwar Lal (A-7) did not hold any authority or independence to favour the accused in any manner whatsoever. He was working only in the capacity of a trainee. Merely because some entries in the DP register were made and checked by accused Kanwar Lal (A-7), is not enough to attribute conspiracy or involvement particularly when he was working under PW-31 and not independently. Therefore, it is concluded that case against accused Kanwar Lal (A-7) is not proved beyond reasonable doubt.
147. It has also been vehemently argued on behalf of defence that there is no evidence to show that any loss has resulted to the bank due to the transactions of account of Cash Credit Limit. No bank witness has deposed about any such loss therefore, ingredients of Section 420 IPC are not complete. However, considering the nature of facts and evidence, I am not in agreement with the arguments of the defence. Loss in ultimate analysis where CCL has become non-performing asset is not projected on behalf of prosecution. The main argument put forth by prosecution has been that various amounts have been withdrawn by committing illegalities and forgery which otherwise would not have been CBI Vs. Sushil Kumar Gupta & Ors. 102 available to the company PFLL. I am also of the opinion that even if, final statement of account showing losses has not been proved in evidence but the withdrawal of various amounts on the basis of forged agreements and related documents is clearly proved on record. Irrespective that company PFLL repaid some or whole of the loan installments, the offences alleged are proved. It cannot be ignored that various sums have been withdrawn on account of false agreements by the company to its benefit resulting in wrongful gain and corresponding wrongful loss to the bank.
Final Conclusion:-
148. In view of my aforesaid detailed discussion, I come to the conclusion that prosecution has been successful in proving its case against Sushil Kumar Gupta (A-1), Narendra Kumar Gupta (A-2), Manoj Kumar Gupta (A-3) and Charan Jeet Arora (A-5).
• Accused Sushil Kumar Gupta (A-1) is accordingly convicted for the offences punishable u/s 120B IPC r/w Section 468, 467, 471 and 420 IPC and also substantive offences u/s 468, 467, 471 and 420 IPC.
• Accused Narendra Kumar Gupta (A-2) and Manoj Kumar Gupta (A-3) are convicted for the offence of criminal CBI Vs. Sushil Kumar Gupta & Ors. 103 conspiracy punishable u/s 120 B IPC read with Section 468, 467, 471 and 420 IPC.
• Public servant accused Charan Jeet Arora (A-5) is convicted for the offence of criminal conspiracy punishable u/s 120 B IPC r/w Section 468, 467, 471 and 420 IPC and also for the substantive offence u/s 13 (1) (d) punishable u/s 13 (2) of Prevention of Corruption Act.
149. Further the accused Madan Lal Mahajan (A-4) and Kanwar Lal (A-7) are acquitted of all the charges by giving benefit of doubt. Both are required to submit bonds in compliance to Section 437 A CrPC.
150. Let the convicts be heard on the point of sentence. Digitally signed
ANJU by ANJU BAJAJ
BAJAJ CHANDNA
Date: 2018.03.14
CHANDNA 14:47:19 +0530
ANNOUNCED IN THE OPEN COURT ANJU BAJAJ CHANDNA
on 14th March 2018 Special Judge-CBI (PC Act)-06
Tis Hazari Courts/Delhi.
CBI Vs. Sushil Kumar Gupta & Ors. 104