Karnataka High Court
Subodh Santosh Gawade vs The State Of Karnataka on 9 July, 2020
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IN THE HIGH COU RT OF KARNA TAKA
DHARWAD BENCH
DATED TH IS THE 9 T H DAY OF JULY , 2020
BEFORE
THE HON'BLE MR. JUSTICE ASHOK G NIJAGANNAVAR
CRIMINAL PETITIO N NO.100641/2020
C/W.
CRIMINAL PETITIO N NO.100645/2020
IN CRL.P.NO.100641/2020
BETWEEN:
1. KIRAN DHONDOPANT THAKUR
AGE: 67 YEARS , OCC: BUSINESS ,
CHAIRMAN, LO KAMANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI,
R/O: 180, GURUWARPETH,
TILAKWADI, TQ & DIST: BELAGAVI- 590001.
2. DR.DAMODAR PANDURANG WAGLE
AGE: 69 YEARS , OCC: BUSINESS ,
VICE-CHAIRMAN, LOKAMANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI,
R/O: OMKAR APARTMENT,
BUDHWARPETH , TILAKWADI,
TQ & DIS T: BELAGAVI-590001.
3. PRASAD KIRAN TH AKUR
AGE: 39 YEARS , OCC: BUSINESS ,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI,
R/O: 180, GURUWARPETH,
TILAKWADI, TQ & DIST: BELAGAVI- 590001.
4. GAJANAN NAGAPPA DHAMANEKAR
AGE: 63 YEARS , OCC: BUSINESS ,
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DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI,
R/O: KRISH NES T BUILDING,
MANGALAWARPETH, TILAKWADI,
TQ & DIS T: BELAGAVI-590001.
5. PANDHARI PUNDALIK PARAB
AGE: 51 YEARS , OCC: BUSINESS ,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI,
R/O: 106/10-A, M AHATMA GANDHI ROAD,
TILAKWADI, TQ & DIST: BELAGAVI- 590001.
... PETITIONERS
(BY SRI SHIVAPRASAD SHANTANAGOUDAR AND SRI
NANDISH PATIL, A DVOCATES .)
AND:
THE S TA TE OF KA RNATAKA
REP. THROUGH PO LICE INSPECTOR,
CEN CRIME POLICE S TA TION,
BELAGAVI CITY ,
NOW REP. BY S TA TE PUBLIC PROSECUTOR,
HIGH COURT OF KARNATAKA, DHARWAD-580011.
... RESPONDENT
(BY SRI PRAVEEN K. UPPAR, HCGP.)
THIS CRIMINAL PETITION IS F ILED UNDER
SECTION 438 OF CRIMINAL PROCEDURE CODE,
PRAYING TO ENLA RGE THE PETITIONERS / ACCUSED
NOS.1 TO 5 ON ANTICIPA TORY BAIL IN CEN BELAGAVI
POLICE S TA TION CRIME NO.07/2020 REGIS TERED FOR
THE OFFENCES PUNISHABLE UNDER SECTIONS 406,
408 AND 420 OF IPC AND SECTION 9 OF THE
KARNATAKA PROTECTION OF INTERES T OF
DEPOSITORS IN FINANCIAL ES TABLISHMENT ACT,
2004, ETC.,.
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IN CRL.P.NO.100645/2020
BETWEEN:
1. SUBODH SANTOSH GAWADE
AGE : 51 YEARS , O CC : BUS INESS,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : 336/B, SANTOSH NIWAS ROY ROAD,
TILAKWADI, TQ & DIST : BELAGAVI- 590001
2. AJIT APPASAHEB GARAGATTI
AGE : 68 YEARS , O CC : BUS INESS,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : 121, HOSUR MATH GALLI,
SHAHAPUR, TQ & DIST : BELAGAVI- 590001
3. PRABHAKAR NARA YAN PA TKAR
AGE : 77 YEARS , O CC : BUS INESS,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : HOUSE NO .149, BUDHUWARPETH,
TILAKWADI, TQ & DIST : BELAGAVI- 590001
4. VITHAL SADASHI PRABHU
AGE : 66 YEARS , O CC : BUS INESS,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : F /1, 413 GA JSHANTI APTS ,
SAVARKAR ROAD,
TILAKWADI, TQ & DIST : BELAGAVI- 590001
5. SHEVANTILAL CHATURDAS SHAH
AGE : 83 YEARS , O CC : BUS INESS,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : 111, CHA TU RMANI MANGALWARPETH,
TILAKWADI, TQ & DIST : BELAGAVI
6. ANIL BABURAO CHOUDHARI
AGE : 67 YEARS , O CC : BUS INESS,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
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R/O : 212, TAHASHILDAR GALLI,
BELAGAVI, TQ & D IS T : BELAGAVI
7. MRS.SAI THAKUR BIJALANI
AGE : 37 YEARS , O CC : BUS INESS,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : 180, GURUWARPETH
TILAKWADI, TQ & DIST : BELAGAVI- 590001
8. MRS.GAYATRI KAKATKAR
AGE : 56 YEARS , O CC : HOUSEWIGE,
DIRECTOR, LOKA MANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : F LA T NO .A-2, 2 N D FLOOR
SUNSHINE APARTMENT, MARATHA COLONY
TILAKWADI, TQ & DIST : BELAGAVI- 590001
9. ABHIJIT AVINASH DIXIT
AGE : 45 YEARS , O CC : SERVICE,
CEO, LOKAMANYA MULTIPURPOSE
CO-OP SOCIETY LTD., BELAGAVI
R/O : RANI CHANNAMMA NAGAR,
TILAKWADI, TQ & DIST : BELAGAVI- 590001
... PETITIONERS
(BY SRI SHIVAPRASAD SHANTANAGOUDAR AND SRI
NANDISH PATIL, A DVOCATES .)
AND:
THE S TA TE OF KA RNATAKA
REP.THROUGH POLICE INSPECTOR,
CEN CRIME POLICE S TA TION,
BELAGAVI CITY ,
NOW REP. BY S TA TE PUBLIC PROSECUTOR,
HIGH COURT OF KARNATAKA, DHARWAD
... RESPONDENT
(BY SRI PRAVEEN K. UPPAR, HCGP.)
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THIS CRIMINAL PETITION IS F ILED UNDER
SECTION 438 OF CRIMINAL PROCEDURE CODE,
PRAYING TO ENLA RGE THE PETITIONERS / ACCUSED
NOS.6 TO 14 ON ANTICIPA TORY BAIL IN CEN BELAGAVI
POLICE S TA TION CRIME NO.07/2020 REGIS TERED FOR
THE OFFENCES PUNISHABLE UNDER SECTIONS 406,
408 AND 420 OF IPC AND SECTION 9 OF THE
KARNATAKA PROTECTION OF INTERES T OF
DEPOSITORS IN FINANCIAL ES TABLISHMENT ACT,
2004, ETC.,.
THESE PETITIONS COMING ON FOR ORDERS
THIS DAY, THE COURT MADE THE FO LLOWING :
ORDER
Crl.P.No.100641/2020 is filed by accused Nos.1 to 5 and Crl.P.No.100645/2020 is filed by accused Nos.6 to 14, under section 438 of Cr.P.C., for release on bail in the event of their arrest in Crime No.7/2020 of CEN Belagavi Police Station, registered for the offences punishable under sections 406, 408 and 420 of IPC and section 9 of the Karnataka Protection of Interest of Depositors in Financial Establishment Act, 2004.
2. The petitioners in the aforesaid criminal petitions are the office bearers of the co-operative 6 society in the name and style as Lokamanya Multi Purpose Co-op Society Limited. On the report submitted by the Joint Registrar of Co-operative Societies, Belagavi Division, the police have registered the case at P.S.Crime No.7/2020. The allegations are that, the office bearers of the society have committed certain financial irregularities as detailed below.
a) The society has not collected income tax returns from the borrowers of large scale loans;
b) The report regarding violation of the property was not taken;
c) Proper utilization certificate in respect of the loan availed is not obtained.
d) The loans are disbursed in violation of bye-laws and regulations of the society.
e) For several loans the
guarantors are one and the same.
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f) Cash credit facility is not
regularly renewed and principal and
interest are not recovered.
g) In several cases in respect of
mortgage loans no charge is created on the properties offered as security; and
h) Several loans have been granted on security of one and the same property which is offered for other loans.
3. In pursuance of the said complaint, police have registered the case and are making attempts to arrest the petitioners. Apprehending the danger of arrest and detention, the petitioners are before this Court.
4. Heard the learned counsel for the petitioners and the learned HCGP for the respondent State. Perused the prosecution records available at this stage.
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5. The main contention of the learned counsel for the petitioners is that the provisions of section 9 of KPID Act are not applicable. In view of section 30, 64 and 65 of the Karnataka Co- operative Societies Act, the complainant ought to have conducted the inspection and should have ascertained whether there are any financial irregularities in the society before filing the complaint. Bald allegations have been made with a vindictive motive to harass the petitioners and to tarnish the image of the society on account of political rivalry. None of the allegations made in the complaint make out a definite case that the petitioners have committed the financial irregularities, thereby committed the alleged offences of cheating, fraud, criminal breach of trust, etc.,. These petitioners have been falsely implicated in this case. In the event of arrest and detention, the personal liberty of the petitioners 9 will be curtailed and image of the society will also be affected.
6. Per contra, the learned HCGP submitted that in view of section 18(2) of KPID Act, the bail petition is not maintainable. On collecting the credible information, the complaint has been filed against the petitioners as there are financial irregularities committed by the society as stated in the complaint. Thus the presence of the petitioners is required for custodial interrogation. As such the petitions deserve to be rejected.
7. The first and foremost contention of the leaned HCGP is with regard to maintainability of the petitions under section 438 of Cr.P.C., in view of section 18(2) of KPID Act. The said section reads as under:
18. Procedure and powers of Special Court regarding offences.- (1) xxxx xxxxxx xxxxx 10 (2) The provisions of the Code of Criminal Procedure, 1973 (Central Act II of 1974) except the provisions of section 438 shall, so far as may be, apply to the proceedings before a Special Court and for the purpose of the said provisions, Special Court shall be deemed to be a Court of Judicial Magistrate, First Class or Metropolitan Magistrate as the case may be.
8. The power vested under section 438 either to Sessions Court or the High Court cannot be curtailed by section 18(2) of KPID Act, unless there are specific grounds to show that the accused persons are involved in the alleged offences. The fundamental postulate of criminal jurisprudence is the presumption of innocence, meaning thereby that a person is believed to be innocent until found guilty. However, there are instances in our criminal law where a reverse onus has been placed on an accused with regard 11 to some specific offences but that is another matter and does not detract from the fundamental postulate in respect of other offences. Yet another important facet of our criminal jurisprudence is that the grant of bail is the general rule and putting a person in jail or in a prison is an exception. No doubt the grant of bail or denial of bail is entirely the discretion of the Judge considering the case but even so, the exercise of judicial discretion has been circumscribed by a large number of decisions rendered by the Hon'ble Supreme Court and all High Courts in our country. Yet, occasionally there is a necessity to introspect whether denying the bail to an accused person is the right thing to do on the facts and in the circumstances of the case.
9. During the course of arguments the learned counsel for the petitioners strenuously contended that in view of the letter issued by the 12 Assistant Registrar of Co-operative Societies, there are no allegations whatsoever either by the depositors or by the customers of the bank alleging any financial irregularities committed by the petitioners. According to section 30(2) of the Karnataka Co-operative Societies Act, the Registrar is empowered to inspect and go through the records of the society before coming to a conclusion about the financial irregularities. There are no specific allegations in the complaint that the Registrar has followed the procedure prescribed under section 30(2) or 64 or 65 of the Karnataka Co-operative Societies Act. Even the allegations made in the complaint do not make out a definite case that these petitioners are directly involved in financial irregularities. At this stage it is needless to make elaborate discussion or to give any finding about the allegations made in the complaint or the records as the same is not 13 permissible while considering the bail applications.
10. In view of the decision of the Hon'ble Apex Court reported in (2011) 1 SCC 694 in the case of Siddhar am S atlingappa Mhetre V/s S tate of Mahar ash tr a and others, one of the parameters that can be taken into consideration while dealing with the anticipatory bail is, frivolity in prosecution and the element of genuineness. In the event of there being some doubt as to the genuineness of the prosecution, in the normal course of events, the accused is entitled to an order of bail. While considering the prayer for grant of anticipatory bail, a balance has to be struck between two factors namely, no prejudice should be caused to the free, fair and full investigation and there should be prevention of harassment, humiliation and unjustified detention of the accused.
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11. The grounds stated in the petitions and the submission made by the counsel goes to prove the apprehension of the petitioners regarding their arrest and detention. The main objection of the prosecution is that in the event of granting bail, the accused persons are likely to interfere with the investigation or tamper the records. The said objections may be set right by imposing stringent conditions.
12. In the facts and circumstances of the case, this Court is of the view that there are valid grounds for granting anticipatory bail subject to certain terms and conditions. Accordingly, I proceed to pass the following:
ORDER Both the petitions filed under section 438 of Cr.P.C. are allowed.
The petitioners/accused persons shall appear before the concerned Investigating Officer 15 within a period of 15 days from the date of receipt of certified copy of this order. On their appearance the Investigating Officer shall interrogate the petitioners and enlarge the petitioners/accused persons on bail.
The petitioners/accused shall be released on bail in the event of their arrest in Crime No.7/2020 of CEN Belagavi Police Station, on their executing personal bond for a sum of Rs.1,00,000/- (one lakh rupees only) each with two sureties for the like sum to the satisfaction of the concerned Investigating Officer.
The petitioners/accused shall not indulge in tampering the prosecution witnesses. The petitioners shall co-operate in the investigation.
The petitioners/accused shall mark their attendance in the concerned police station on 16 every Sunday between 10.00 a.m. to 5.00 p.m., till filing of the charge sheet.
The petitioners/accused shall not leave the jurisdiction of the trial Court without prior permission, till the disposal of the case.
If the petitioners/accused violate any of the conditions, the bail order automatically stands cancelled.
SD/-
JUDGE M r k/ -