Orissa High Court
Sri Surendra Nath Senapati vs State Of Odisha on 13 November, 2014
Author: S.K. Sahoo
Bench: S.K. Sahoo
IN THE HIGH COURT OF ORISSA, CUTTACK.
BLAPL NO.2831 OF 2014
An application under section 438 of the Code of Criminal
Procedure.
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Sri Surendra Nath Senapati ........ Petitioner
-Versus-
State of Odisha ......... Opp. Party
For Petitioner: - M/s. A.H. Khan, A. Kanungo,
C.Nayak, R.C. Praharaja.
For Opp. party: - Mr. Karunakar Nayak &
Mr. Jyoti Prakash Patra
Addl. Standing Counsels
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P R E S E N T :-
THE HONOURABLE MR. JUSTICE S.K. SAHOO
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Date of Argument. 13.11.2014 Date of order- 13.11.2014
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S.K.SAHOO, J.The petitioner who is at present working as Chief Manager (International Remittance Centre) of State Bank of India, Kolkata, has filed this application under section 438 Cr.P.C. for grant of anticipatory bail in connection with Economic Offences Wing, Bhubaneswar P.S. Case No.29 of 2013 registered under sections 2 419/420/467/468/471 read with section 120-B of Indian Penal Code corresponding to C.T. Case No. 4277 of 2013 pending in the court of learned S.D.J.M., Bhubaneswar.
2. One Manash Ranjan Mohanty who is the Regional Manager, State Bank of India, Regional Business Office-II, Bhubaneswar Zone-II, Bhubaneswar submitted the FIR before the Superintendent of Police, Economic Offence Wing, CID, Crime Branch, Bhubaneswar, Orissa stating therein that Sakhigopal Branch of State Bank of India had sanctioned 51 numbers of personal loan of Rs.1,17,05,000 to E.CO. Railway employees during the period 2003 to 2006 on the strength of check off by the Drawing and Disbursing Officer (DDOs) and pay slip submitted by the employees. It is stated that the loans were recommended by the Field Officer/Deputy Manager and sanctioned by the Branch Manager of Sakhigopal Branch. When the loan accounts became irregular due to non-payment of installments, on taking up the matter with Railway Authorities for recovery, the Senior Division Personel Officer of E.Co. Railways, Khurda Road lodged complaint, inter alia, citing forgery of the DDO's signature on the salary slip, on letter of authority for deduction from salary and remittance to loan account etc. and it is stated that 14 nos. of persons were not 3 found in the employees roll of E.Co. Railway. It is further stated in the FIR that the personal loan have been availed by submitting fake/fabricated documents and some of them are not in the employee record even though they have availed loan claiming as permanent employees of the Railways. Out of 51 loan accounts, 5 accounts were closed and the rest were irregular. It is stated that the petitioner and one J.C. Nahak were the Branch Managers during the period of sanction and S.K. Sadaquat Alli, Umesh Chandra Kar were the Field Officers who recommended the loan.
On the basis of such FIR, the case was registered on 5.11.2013 against 51 loanees and some Bank Officers.
3. The learned counsel for the petitioner submitted that the petitioner worked as Branch Manager of State Bank of India, Sakhigopal Branch from 1.1.2004 to 26.7.2006 and in respect of the alleged transactions, KYC norms were adhered to by the petitioner and residential address were verified by the concerned Field Officer during the sanction of loan. It is further submitted that the petitioner sanctioned 46 loan proposals out of the 51 nos. of personal loan as mentioned in the FIR and out of 46, 6 loan accounts have been closed in normal course of repayment. It is further submitted that as per the office order, a 4 Field Officer of Deputy Manager Grade was looking after the personal advance and the Field Officer was categorically instructed to verify the genuineness of the proposals/documents and recommendation for sanction. It is submitted that the petitioner sanctioned the loan on the basis of recommendation of the Field Officer and he had acted and followed the norms for the better growth of the Bank and prior to the sanction of loan, the Field Officer had verified the genuineness/proposal of documents and recommended for sanction of loan and accordingly the petitioner as Branch Manager sanctioned the loan basing on such recommendation and therefore it is urged that the ingredients of offences under which the case has been registered are not made out against the petitioner. According to the learned counsel for the petitioner, as per the Bank instructions, at the relevant point of time, a scheme named as "Suvidha" loans was introduced during the year 2004-2006 and the eligibility of the borrowers were calculated from the salary certificates issued by Railway Authorities. It is submitted that since the Railway is a Central Government Organization, the petitioner without insisting for salary accounts accepted check off facility from the DDO for sanction of loan. It was urged by the learned counsel for the petitioner that since the petitioner is 5 serving as the Chief Manager which is a very high ranking post in the State Bank of India, there is no chance of absconding and the case is based mainly on documentary evidence and when the investigation has made substantial progress and all the relevant documents have been seized, unless anticipatory bail is granted, the petitioner may be arrested and thereby his image in the public would be tarnished and he would unnecessarily face humiliation by the Investigating Agency.
During course of argument the learned counsel for the petitioner filed an additional affidavit of the petitioner dated 19.10.2014 indicating therein that during his period as Branch Manager, the petitioner had sanctioned 46 personal loans to 45 Railway Employees including 2 personal loans to one employee which were closed. It was further mentioned in the additional affidavit that it is a case where several loans amounting to Rs.1 lakh and 1.5 lakhs were sanctioned to 45 persons after it was verified by the Field Officer regarding the bonafide of their employment and submission of their salary slip and DDO certificate. It is urged that from out of 1.05 crores sanctioned to 45 loanees, 25 accounts were fully recovered i.e., 82.05 lakhs and in respect of other 20 accounts, partial recovery to the tune of Rs.17.28 lakhs have been made and therefore there was 6 total recovery of about Rs.99.33 lakhs out of Rs.1.05 crores. It is further submitted that the petitioner always cooperated with the Investigating Officer and Disciplinary Action has been initiated against him.
Another additional affidavit dated 6.11.2014 was filed by the petitioner annexing certain documents. It was indicated in the additional affidavit that so far as sanction of Xpress Credit loan are concerned, it was subject to the following process i.e., appraising/assessment and sanctioning of Xpress Credit loans which shall be done by two different officials and the Manager (PBD)(wherever posted) shall sanction Xpress Credit loan subject to the condition that the same is appraised and recommended by Desk Officer (Adv.)/relationship Manager/Dy. Manager (PB). It is further submitted that the Filed Officer Sk. Sadaquat Alli, Umesh Chandra Kar and other Branch Manager J.C. Nahak are on bail and therefore in the fitness of things the petitioner should be granted anticipatory bail.
4. The learned counsel for the State opposes the prayer for grant of anticipatory bail to the petitioner and submitted the present status list of the loan sanctioned by the petitioner. It is indicated in the status list that the petitioner while acting as 7 Chief Manager, State Bank of India, Sakhigopal Branch, Puri had sanctioned 46 loans to the loanee out of which 16 loanee have already paid their loan amount. It is mentioned in the status list that Rs.1,09,30,000 was sanctioned by the petitioner during his tenure to 46 persons and the outstanding loan amount excluding the up-to-date interest is Rs.48,23,066.38 paisa.
The learned counsel for the State produced the case diary containing the letter of one Pramod Behera, Assistant Personnel Officer (Bills) for Sr. Divl. Personel Officer/KUR of East Coast Railways dated 8.1.2014 which indicates that no officer as DDO was authorized to sign in any documents relating to Bank loan availed by any Railway Employee. The General instruction regarding safe guards to be taken against frauds indicates that in all cases of bulk loan proposals received from the employees of a company/firm/organizations, the status of the employee should be got confirmed from the concerned company/firm/organisation by stringent application of key KYC norms. Document submitted by the employees such as salary slips, income tax returns etc. should be independently verified through bank's own staff. It is further indicated that personal visits to the Borrower/Guarantor's house/office and/or maintaining effective liaisons with 8 DDO/Officials in Accounts Department of concerned office will not only be held in ascertaining the reasons for default but will eventually help in resolving the Quick Mortality Accounts in Personal Loans. The learned counsel for the State has pointed out that the letter dated 1.3.2014 of State Bank of India Officers Associations indicates regarding the role and responsibility of Branch Manager and it further indicates that the Branch Manager is vicariously responsible for the acts of his subordinates and he has to verify the security documents relating to advances/loans and verify whether they are appropriate, current and enforceable. It is further indicated in the said letter that so far as credit management is concerned, there should be proper pre-sanction survey which is to be conducted by the Field Officer and recorded in the Branch Inspection Register as well as in loan application/sanction note and the Branch Manager should interact with borrower personally and he has to ensure that the financial powers are exercised as per Bank's instruction. The learned counsel for the State has also placed as to what documents are to be verified in the matter of sanction of personal loan. The learned State counsel has placed the statement of one Laxman Chandra Majhi who is the Chief Manager of SBI of Sakhigopal Branch. He has stated that the seal and signature of Senior Divisional 9 Personal Officer have been forged and the date of birth mentioned in loan papers were manipulated in connivance with the Bank officials as per the internal investigation report of the SBI, Vigilance Department relating to the sanction of 46 nos. of loan. He has further stated that neither the Field Officer nor the petitioner had verified the KYC documents submitted by the loanees and they did not discuss the matter with the (DDO) Sr. Divisional Personal Officer, East Coast Railway, Khurda Division prior to sanction of loan. He has further stated that the documents indicate that the petitioner has connived with the Field Officer of the Bank and prepared forged documents fabricating the date of birth, rank and designation of the loanees to get the loan sanctioned. He has further submitted that the forged ID cards and other documents were used by the loanees for their wrongful gain putting the bank in huge loss and therefore in a case of this nature where custodial interrogation is very much necessary, the anticipatory bail should not be granted.
5. There is no dispute that the case relates to commission of economic offences.
In case of Y.S. Jagan Mohan Reddy -v- CBI reported in (2013) 55 Orissa Criminal Report (SC) 825, it is held as follows:-
10
"15. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offences having deep rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country.
16. While granting bail, the Court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of public/State and other similar considerations."
In case of State of Gujurat -v- Mohan Lal Jitamal Torwal reported in AIR 1987 SC 1321, it is held as follows:-
"5.
xx xx xx The entire community is aggrieved if the economic offenders who ruin the economy of the State are not brought to book. A murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the Community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the Community in the system to administer justice in an even handed manner without fear of criticism from the quarters which view white colour crimes with a permissive eye unmindful of the damage done to the National Economy and National Interest".11
In case of State -v- Radhakrishnan reported in 2003 (1) Current Tamil Nadu Cases 530, Hon'ble Justice C.Nagappan has held as follows:-
"21. The larger interest of the public and State demand that in economic offences the discretion to grant anticipatory bail under section 438 of Criminal Procedure Code should be exercised with utmost care and caution"
6. Considering the submissions made by the respective parties, it appears that the petitioner who was Ex-Branch Manager of State Bank of India, Sakhigopal Branch had sanctioned 46 personal loans amounting to Rs.1,11,31,000 during his incumbency period 1.1.2004 to 26.7.2006 which is practically not disputed by the learned counsel for the petitioner. It further appears that there are instructions and guidelines of the Bank regarding sanction of personal loans. There is no dispute that the Branch Manager sanctions the personal loan on the basis of recommendation of Field Officer of the Bank but such loan is to be sanctioned to the Government employees and private employees of big companies on the basis of consideration of the strength of salary. It is also necessary to verify the signature of DDO, authenticity of salary certificate and KYC documents furnished by the loanees. Apart from the role of the Field Officer as prescribed in the guidelines, the Branch Manager 12 of the Branch being the overall in-charge of the Branch is to ensure proper documentation, proper pre-sanction survey and interaction with the loanees directly.
Prima facie it appears that the general instructions and guidelines of the Bank relating to grant of personal loan have not been followed in the case in hand. The required documents for grant of such personal loan were not duly verified and on the basis of forged documents, loan has been sanctioned. Even though 46 nos. of loan were sanctioned during the incumbency period of the petitioner amounting to Rs.1,11,31,000 but the present outstanding amount excluding the up-to-date interest in respect of such 46 loan accounts is Rs.48,23,066.38 paisa.
The learned counsel for the State submits that in a case of this nature, custodial interrogation would be qualitatively more elicitation oriented. In case the petitioner is well protected and insulated by a pre-arrest bail order then he is likely to conceal many useful information and materials which would be required by the Investigating Officer.
In view of the available materials, prima facie it appears that there are the deep-rooted conspiracies between the accused persons in the grant of personal loan basing on forged documents 13 and thereby causing huge loss to the Bank. The Bank Manager being overall in-charge of the branch, he is vicariously responsible for the acts of his subordinates. He has to verify the security documents relating to personel loan as to whether those are appropriate, current and enforceable. When safeguards provided under general instructions of the Bank are not followed, then it causes huge loss to the institutions as has happened in this case. The consideration which should weigh with the Court while dealing with a request for anticipatory bail need not be the same as an application to release on bail after arrest. This case has the capacity of shaking public faith in the Banking system which is an important limb of financial net work in the country. In-depth investigations is required to be made to detect all those who are connected with such a big fraud and considerations for which such a conspiracy was hatched.
Accordingly, considering the nature and gravity of the accusations with utmost care and caution and the large amount involved in the fraud and the role attributed to the petitioner in day-to-day functioning of the Bank, I am of the opinion that custodial interrogation of the petitioner is absolutely essential. Therefore, I find no good and sufficient grounds for enlargement 14 of the petitioner on anticipatory bail as prayed for. The anticipatory bail application is therefore rejected.
The BLAPL is accordingly dismissed.
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S.K. Sahoo,J.
Orissa High Court, Cuttack The 13 November,2014/Pravakar