Rama Shankar Vishwakarma vs State Of Mp on 23 October, 2020

[Cites 6, Cited by 3]

Madhya Pradesh High Court

Rama Shankar Vishwakarma vs State Of Mp on 23 October, 2020

This is third bail application filed by the applicant under Section 439 of Cr.P.C. Applicant Rama Shankar Vishwakarma was arrested on 18/12/2019 in Crime No.46/2019 registered at Police Station Economic Offence Wing Bhopal(M.P.) for the offence punishable under Sections 409 read with Section 120-B of the IPC and Section 7(C) of the Prevention of Corruption Act, 1988.

2. The first bail application of the applicant has been dismissed on merit vide order dated 23/1/2020 passed in M.Cr.C.No.94/2020 and second bail application has also been dismissed on merit vide order dated 16/07/2020 passed in M.Cr.C.No.14025/2020.

3. As per prosecution case, Bhopal Cooperative Central Bank Limited, Bhopal, is a bank incorporated under the Madhya Pradesh Societies Act 1960 which is registered with the Reserve Bank and operates as per the policies approved by the Board of Directors of the Bank based on the circulars issued from time to time by the Reserve Bank of India and National Bank For Agriculture & Rural Development (NABARD). Out of the deposits available with the bank, except the minimum capital fixed by the Reserve Bank of India, the remaining amount is invested by the bank for the benefit. Upon receipt of information that the return of the amount invested by the bank, in the two subsidiaries of Infrastructure Leasing & Financial Services i.e. (a) IL & FS Education and Technology Signature Not Verified SAN Services Limited (IETSL) and (b) IL & FS Transportation Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST 2 MCRC-33843-2020 Networks Limited (ITNL) had become irrecoverable, inquiry committee was constituted by the Cooperative Commissioner and Registrar Co- operative Societies, Bhopal vide order dated 16/04/2019. In the inquiry, the committee found that according to the investment policy of Bhopal Cooperative Central Bank laid down by the Managing body of Bhopal Central Cooperative Bank vide its resolution dated 28/02/2015, which was in force at the time of alleged investment, the non SLR surplus funds could be invested by the Bank only in the short term and long term deposits for earning maximum possible interest income with different Nationalized/Scheduled/Private Sector Banks of high repute and recognition. The Non-SLR investments, shall not exceed 10% of the total deposits of the bank as on March 31st of the preceding financial year. While the applicant and other co-accused invested 25% of the total deposits in commercial papers and in private banks in the form of fixed deposits. Applicant, who was posted as the Managing Director of Bhopal Cooperative Central Bank from July 2017 to 5 th July 2019 and co-accused Subhash Sharma and Anil Kumar Bhargava, member of the Investment Committee invested the amount of Rs.303 Crores in commercial paper, out of which Rs.111 Crore were invested in two subsidiaries of Infrastructure Leasing & Financial Services I.e. (a) IL & FS Education and Technology Services Limited and (b) IL & FS Transportation Networks Limited which was Contrary to the prevailing guidelines and norms.

4. It was also found that the applicant and other co-

accused persons invested Non-SLR surplus fund in some Small Financing Banks which were not the scheduled bank and at the time of investment not registered with the RBI and applicant and co-accused without examining the reliability of these banks, invested the amount in these banks against the investment policy Some investment was also done through the broker while the amount of Non-SLR surplus fund can not be invested through brokers.

Signature Not Verified SAN

5. It was also found that according to the resolution dated Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST 3 MCRC-33843-2020 23/12/2000 of the managing body of Bhopal Cooperative Central Bank, the investment was to be done according to the recommendation of the Investment Committee comprising Assistant Manager (Account) /Assistant Manager (MOU-Development) /Branch Manager (Account) and Assistant Accountant (Senior) as members while applicant R.S. Vishwakarma constituted the Investment Committee in which, Subhash Sharma, Branch Manager (Account), Anil Bhargava, Branch Manager and Shri Rajesh A. Sabu, Chartered Accountant and he himself were the members. The applicant and other co-accused had invested the Non SLR fund of the bank in commercial papers and Non-scheduled banks contrary to the investment policy of the bank for getting the undue benefit. They had invested the amount of Rs.303 Crores in commercial paper, out of which Rs.111 Crore were invested in two subsidiaries of Infrastructure Leasing & Financial Services i.e. (a) IL & FS Education and Technology Services Limited and (b) IL & FS Transportation Networks Limited which became unrecoverable. On that report, Additional Secretary, M.P. Govt. General Administrative Department, Bhopal sent the letter dated 6/9/2019 to EOW for taking action against the persons, who were liable for that. On that report, EOW registered enquiry no.18/2019 and after enquiry, registered Crime No. 46/2019 at Police Station, Economic Offence Wing Bhopal (MP) against the applicant and other co-accused persons for the offence punishable under Sections 409 read with Section 120-B of the IPC and Section 7(C) of the Prevention of Corruption Act, 1988.

6. Learned counsel for the applicant submitted that the applicant is innocent and has falsely been implicated in the offence. It is further submitted that RBI issued circular for all State/Central Co-operative Banks dated 14/7/2016, whereby, the Co-operative Banks were authorized to invest in category "A" or equivalent and higher-rated Commercial Paper/ Debenture/Bonds etc. He further submitted that as on 31/3/2018, the total deposit of the Bank was Rs.356503.37 Lakhs and as per aforesaid RBI Signature Not Verified SAN Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST 4 MCRC-33843-2020 guidelines the bank was authorised to make 10% of the total deposit in Non- SLR investment i.e.Rs.35650.37 Lakhs. In view of the circular of the RBI dated 14/7/2016, when the Investment Committee of the Bhopal Cooperative Central Bank Ltd. Bhopal met on 4/1/2017 and 10/4/2017, the said guidelines of the RBI were duly taken note of and it was unanimously decided to invest in the commercial papers within the permissible limits. The said decision of the committee was duly approved by the Board of Directors in its meeting dated 28/6/2017 and when the Investment Committee decided to invest Non- SLR fund in securities as per RBI guidelines dated 14/7/2016 applicant was not functioning as General Manager of Bhopal Cooperative Central Bank Limited Bhopal. At that point of time, the applicant was functioning as Deputy Registrar of Cooperatives at Hoshangabad. Applicant was appointed and posted as Managing Director of Bhopal Cooperative Central Bank Limited vide order dated 24/7/2017.

7. He further submitted that according to RBI circular, the Cooperative Banks are permitted to invest non-SLR funds in commercial papers in the form of promissory note in the Company whose rating is "A3" or above. The two entities of Infrastructure Leasing & Financial Services i.e.

(a) IL & FS Education and Technology Services Limited (IETSL) and (b) IL & FS Transportation Networks Limited (ITNL), were rated A and A+ at the material point of time by the Credit Rating Agency, which are registered with SEBI. He further submitted that decision taken thereon, by the Investment Committee in its meeting dated 4/1/2017 and 10/4/2017 in the light of RBI guidelines dated 14/7/2016 and the same having been approved by the Board of Directors in its meeting dated 28/6/2017, the Bhopal Cooperative Central Bank made investments in Non-SLR Commercial Paper in aforesaid two entities of IL & FS i.e. IETSL and ITNL and the investment made by the Bank in the form of commercial paper in ITNL on 26/12/2017 and 3/1/2018 with maturity dated 26/3/2018 respectively were received by the Bhopal Cooperative Central Bank Limited. Only four other commercial papers whose Signature Not Verified SAN Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST 5 MCRC-33843-2020 maturity dated 15/10/2018, 23/10/2018, 26/3/2019 and 28/2/2019 were not received by the Bhopal Cooperative Central Bank Ltd. even after the date of its maturity. Because payment of said commercial papers has been stayed by the NCLAT in which there is no fault of the applicant. Proceeding is going on in this regard before NCLAT. Therefore at this juncture, it is premature to say that the amount of Rs.111 Crores invested in the form of commercial papers in IETSL & ITNL becomes unrecoverable.

8. Learned counsel for the applicant further submitted that earlier police registered the case against the applicant under Sections 409 read with Section 120-B of the IPC and Section 7(C) of the Prevention of Corruption Act, 1988 thereafter at the time of filing of the charge sheet police did not find any case against the applicant under Section 409 of the IPC. There is no evidence on record to show that the applicant took any money from the bank fund. In the final report, there is no document to show that any broker was involved in the alleged transaction. On the contrary in the final report also, it is clearly mentioned that no broker was found working in the Bank. There is no evidence on record to show that the applicant gained any undue benefit from the said amount. Recently, Rs. 13 crore has been returned by the IL & FS group of companies out of the amount invested by the bank. The applicant has been in custody since 18/12/2019. Charge sheet has been filed. The conclusion of the trial will take time. Therefore, the applicant will be released on bail.

9. On the other hand, learned counsel for the EOW opposed the prayer and submitted that from the enquiry report and the evidence collected by EOW during investigation, it is apparent that the applicant invested the amount of Rs.545 Crores against the direction issued by the Managing body of the Bank and RBI guidelines and violating the norms and caused loss to the bank to the tune of Rs.111 Crores.

10. He further submitted that RBI by it's circular dated 14/7/2016, permitted the Co-operative Banks to invest the Non-SLR fund in Commercial Signature Not Verified SAN Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST 6 MCRC-33843-2020 Paper/Debenture/Bonds etc but according to investment policy dated 28/02/2015, which was in force at the time of alleged investment, Non- SLR surplus funds can be invested by the Bank only in the short term and long term deposits for earning maximum possible interest income with different Nationalized/Scheduled/Private Sector Banks of high repute and recognition. The decision taken by the Board of Governors in the meeting dated 28/06/17 was effective till June 17th only. The decision to invest in securities was not to be made by the Investment Committee, but it was for the Board of Directors to take a decision on it, as written in the details of the proceedings of the Investment Committee dated 10/07/17.

11. He further submitted that as per norms the Non-SLR investments, could not exceed 10% of the total deposits of the bank as on March 31st of the preceding financial year while the applicant and other co- accused invested 25% of the total deposits in commercial papers and in private banks in the form of fixed deposits. Applicant, who was posted as the Managing Director of Bhopal Cooperative Central Bank from July 2017 to 5th July 2019 and co-accused Subhash Sharma and Anil Kumar Bhargava had invested the amount of Rs.303 Crores in commercial paper, out of which Rs.111 Crore invested in two subsidiaries of Infrastructure Leasing & Financial Services i.e.(a) IL & FS Education and Technology Services Limited and (b) IL & FS Transportation Networks Limited Contrary to the guidelines and norms. The repayment of that amount (Rs.111.29 Crores) became doubtful.

12. Apart from commercial papers the Non-SLR amount was also invested by the applicant and co-accused in some banks contrary to the investment policy that existed at that time. According to the policy, the SLR amount should be invested in approved and reputed banks while the applicant invested Non-SLR amount in the banks which were not reputed. The applicant even invested Rs.10 Crores amount in Trust Financial Consultancy Services Private Limited through broker while according to the guidelines Signature Not Verified SAN Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST 7 MCRC-33843-2020 issued by NABARD, Non-SLR funds can not be invested through broker. He further submitted that in further investigation EOW recorded the statement of officials of Tipson Consultancy Services Private Limited which prima facie show that Tipson Consultancy Services Private Limited was involved in the said transaction. So the applicant should not be released on bail.

13. Earlier bail applications of the applicant have been dismissed on merits by this Court vide orders dated 23/01/2020 & 16/07/2020 passed in M.Cr.C.Nos.94/2020 & 14025/2020 and thereafter there has been no change in circumstances except the period of detention.

14. The Apex Court in the case of Rajesh Ranjan Yadav alias Pappu Yadav v. CBI Through its Director reported in (2007) 1 SCC 70 held that bail cannot be granted solely on the ground of long incarnation in jail and inability of accused to conduct the defence.

15. It is alleged that the applicant and co-accused went against the guidelines and norms issued from time to time by the Reserve Bank, NABARD and Board of Directors of Banks had wrongly invested Non-SLR funds in commercial papers and small banks due to which caused a loss to the tune of Rs.111.29 Crores to the Bank, and also wrongly invested some amount through brokers which is not permitted. In the case diary it is mentioned that Neeraj Kapur Manager of IL & FS Education and Technology Services Limited informed that the service fees was paid to Tipson Consultancy Services Private Limited Ahmedabad as an arranger regarding the transaction of Rs. 55 Crores made by the Bhopal Cooperative Central Bank Limited. It prima facie shows that the broker was involved in the transaction which was against the investment policy. Even, learned counsel for the respondent/EOW submitted that in the further investigation, the statement of officials of Tipson Consultancy Services Private Limited was recorded which prima facie show that Tipson Consultancy Services Private Limited was involved in the said transaction. So looking to the facts and circumstances of the case and the allegations this court is not inclined to Signature Not Verified SAN Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST 8 MCRC-33843-2020 grant bail to the applicant.

16. Hence application is rejected.

(RAJEEV KUMAR DUBEY) JUDGE (ra) Signature Not Verified SAN Digitally signed by RANJEET AHIRWAL Date: 2020.10.23 16:19:27 IST

Unlock Advanced Research with PRISMAI

Madhya Pradesh High Court