Karnataka High Court
R Shivakumar vs The State Of Karnataka on 7 December, 2023
Author: K. Natarajan
Bench: K. Natarajan
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 7TH DAY OF DECEMBER, 2023
BEFORE
THE HON'BLE MR. JUSTICE K. NATARAJAN
CRIMINAL APPEAL NO.792 OF 2011
CONNECTED WITH
CRIMINAL APPEAL NOS.780 OF 2011, 812 OF 2011, 813 OF
2011, 814 OF 2011, 815 OF 2011 AND 967 OF 2011
IN CRIMINAL APPEAL NO.792 OF 2011
BETWEEN:
SRI. SRIKANTH KULKARNI
S/O. BHIMRAO KULKARNI
R/AT.VASTRADA GALLI
M S WARAD BUILDING,
SINDHAGI BIJAPUR TALUK
BIJAPUR DISTRICT
... APPELLANT
(BY SRI. R. NAGENDRA NAIK, ADVOCATE)
AND:
STATE BY INSPECTOR
OF POLICE, CBI ACB
BANGALORE
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
2
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C PRAYING THAT THIS HON'BLE COURT MAY
BE PLEASED TO SET ASIDE THE ORDER OF CONVICTION
AND SENTENCE DATED 05.07.2011 PASSED BY THE XXXII
ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR CBI
CASES, BANGALORE IN SPL.C.C.NO.09/2008 - CONVICTING
THE APPELLANT/ACCUSED FOR THE OFFENCES PUNISHABLE
UNDER SECTIONS 120(b) READ WITH SECTIONS 468, 471,
477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.780 OF 2011
BETWEEN:
R. SHIVAKUMAR
S/O. N. RAMASUBRAMANIAN,
AGE: 55 YEARS, OCC: MANAGER, UCO BANK,
INDIRANAGAR BRANCH,
BANGALORE .
R/O. NO.17/1, MUDDAPPA ROAD,
MARUTHI SEVA NAGAR,
BANGALORE.
... APPELLANT
(BY SRI. S. P. KULKARNI, SENIOR ADVOCATE FOR
JANKI RAMAN, ADVOCATE)
AND:
THE STATE OF KARNATAKA
REPRESENTED BY INSPECTOR OF POLICE,
C.B.I/ACB,
BANGALORE - 560 001.
... RESPONDENT
(BY SRI. P.PRASANNA KUMAR, SPECIAL COUNSEL)
3
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.5 FOR THE
OFFENCES PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.812 OF 2011
BETWEEN:
SMT. MALLAMMA
W/O LATE B. S. RAJASHEKARAIAH,
R/AT H NO.1488/27, 1 "A" CROSS,
SIDDAVEERAPPA EXTENSION,
DAVANAGERE.
... APPELLANT
(BY SRI. R. NAGENDRA NAIK, AMICUS CURIAE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY
STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
4
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C. PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.5 FOR
OFFENCE PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.813 OF 2011
BETWEEN:
SIDDAVEERAIAH
S/O SIDDALINGASWAMY.G,
R/AT H NO.1488/27, 1ST "A" CROSS,
SIDDAVEERAPPA EXTENSION,
DAVANAGERE.
... APPELLANT
(BY SRI. MOHAMMED MUJASSIM, ADVOCATE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P PRASANNA KUMAR, SPECIAL COUNSEL)
5
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) CR.P.C PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.2 FOR THE
OFFENCE PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.814 OF 2011
BETWEEN:
SIDDALINGASWAMY K. V.
S/O VEERAIAH,
R/AT BANNIKODU VILLAGE,
HONNALI TALUK,
DAVANAGERE.
... APPELLANT
(BY SRI. N. DEVARAJ, ADVOCATE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY
STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
6
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C. PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.6 FOR THE
OFFENCE PUNISHABLE UNDER SECTIONS 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.815 OF 2011
BETWEEN:
SMT. VANISHREE B R W/O SIDDAVEERAIAH
R/AT H NO.1488/27, I "A" CROSS,
SIDDAVEERAPPA EXTENSION,
DAVANAGERE.
... APPELLANT
(BY SRI. MOHAMMED MUJASSIM, ADVOCATE)
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
7
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANT / ACCUSED NO.3 FOR THE
OFFENCE PUNISHABLE UNDER SECTION 120(b) READ WITH
SECTIONS 468, 471, 477(A) AND 420 IPC.
IN CRIMINAL APPEAL NO.967 OF 2011
BETWEEN:
1 . SHRI. SHIVAMURTHAIAH
S/O MAHADEVAIAH,
2 . SHRI. MAHADEVAIAH
S/O SHIVAMURTHAIAH
BOTH R/AT H. NO.491,
BELIKERE ROAD,
SHAMNUR VILLAGE,
DAVANAGERE.
... APPELLANTS
(APPELLANT NO.1 IS ABATED
VIDE ORDER DATED.06-06-2023, IN Crl.A.No.792/2011;
BY SRI. N. DEVARAJ. ADVOCATE FOR A2)
8
AND:
STATE BY INSPECTOR OF POLICE
CBI, REPRESENTED BY STANDING COUNSEL FOR CBI
IN THE HON'BLE HIGH COURT,
BANGALORE.
... RESPONDENT
(BY SRI. P. PRASANNA KUMAR, SPECIAL COUNSEL)
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
374(2) OF CR.P.C. PRAYING TO SET ASIDE THE ORDER OF
CONVICTION AND SENTENCE DATED 05.07.2011 PASSED BY
THE XXXII ADDL. CITY CIVIL AND S.J. AND SPL. JUDGE FOR
CBI CASES, BANGALORE IN SPL.C.C.NO.09/2008 -
CONVICTING THE APPELLANTS / ACCUSED NOS.7 AND 8
FOR THE OFFENCE PUNISHABLE UNDER SECTION 120(b)
READ WITH SECTIONS 468, 471, 477(A) AND 420 IPC.
THESE CRIMINAL APPEALS HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT ON 22.09.2023 THIS DAY, THE
COURT PRONOUNCED THE FOLLOWING:
9
JUDGMENT
The Crl.A.No.780/2011 is filed by the appellant/accused No.1, Crl.A.No.812/2011 is filed by the appellant/accused No.5 (died during the pendency of the appeal), Crl.A.No.813/2011 is filed by the appellant/accused No.2. Crl.A.No.814/2011 is filed by the appellant/accused No.6. Crl.A.No.815/2011 is filed by the appellant/accused No.3. Crl.A.No.967/2011 is filed by the appellants/accused Nos.7 and 8 (during the pendency of the appeal the first appellant - accused No.7 died) and Crl.A.No.792/2011 is filed the appellant/ accused No.9 under Section 374 (2) of Cr.P.C. for setting aside the judgment of conviction and sentence passed by the XXXII Additional City Civil and Sessions Judge and Special Judge for CBI cases, Bengalore (CCH-34) in Spl.C.C.No.09/2008 dated 05.07.2011 for having convicted and sentenced the appellants to undergo imprisonment and fine for the offences punishable under Sections 120(B) read with Section 468, 471, 477(A) and 420 10 of IPC against all the accused and under Sections 13 (1) (d) read with Section 13 (2) of Prevention of Corruption Act, 1988, as against accused No.1 in Crl.A.No.780/2011.
02. During pendency of the appeal the appellant/accused No.6 in Crl.A.No.814/2011 died and the appellant No.2 i.e., accused No.7 in Crl.A.No.967/2011 also died. The accused No.4 was died prior to filing the appeal and charges stand abetted.
03. Heard the arguments of the learned Senior Counsel for the appellant/accused No.1 in Crl.A.No.780/2011 and counsel for the appellants in other cases and the Special Counsel for the CBI.
04. The appellants are accused persons and the respondents are the complainant / prosecution before the Trial Court. The ranks of the parties are retained for the convenience.
11
05. The case of the prosecution is that the accused No.1 - R. Shiva Kumar who was Manager of the UCO Bank, Indra Nagar Branch, Davanagere. During his tenure as a Manager at Davanagere between 05.05.2002 to 12.08.2004 functioning as a public servant, conspired with the other accused persons. Accused Nos.2 to 9 have filed applications for seeking various loans applications for the purpose of purchase of pipes accessories submersible pumps, two wheeler tipper and other agricultural equipments. They have forged the documents and produced before accused No.1 as genuine to cheat the Bank and without following the procedure and guidelines of RBI, the accused No.1 sanctioned loans to the accused Nos.2 to 7 which is as under:-
Sl Nature of the Date of To whom Nature of the No loan, quantum of Sanction sanctioned collateral sanction and security disbursement
1. UCO Megha Cash 12.06.2004 A.2 Land Sy.No.53, Loan Siddaveerai 1/P2 of Rs.10,00,000/- ah Bennikode with godown valued at Rs.19,55,000/-
12
2 UCO Megha Cash 03.06.2004 A.3 Land
Loan Vanishree Sy.No.53/3 of
Rs.10,00,000/- w/o A.1 Bennikode
valued at
Rs.15,90,000/-
3 UCO Megha Cash 28.05.2004 A.4 House property
Loan Rajashekha in
Rs.10,00,000/- raiah Sy.No.133/53
and 62 of
Bannikode
valued at
Rs.85,29,500/-
4 Agricultural term 03.06.2004 A.5 Not created
loan Maliamma any charge on
Rs.5,00,000/- the agricultural
land.
5 UCO Megha Cash 26.05.2004 A.6 Land
Loan Siddalingas Sy.No.133 of
Rs.10,00,000/- wamy Bannikode
valued at
Rs.15,20,000/-
6. Agricultural terms 13.11.2003 A.7 Not created
loan Shivamurth
any charge
Rs.2,90,000/- aiah
over the
agricultural
land.
7. Agricultural terms 13.11.2003 A.7 Not created
loan Shivamurth any charge
Rs.1,10,000/- aiah and
Rs.1,45,000/- Mahedevaia
over the
h agricultural
land
06. It is further alleged that the loans were
sanctioned by the accused No.1 on the forged documents by violating the norms. The loans were not utilized for the 13 purpose which were sanctioned and caused wrongful loss to the Bank, thereby wrongful gain made by the accused Nos.2 to 7. The accused No.8 said to be guarantor and accused No.9 said to be the scribe of the loan applications. All the accused persons have committed the offence under the provisions of IPC and the accused No.1 also committed offence punishable under Sections 13 (1) (c) (d) and 13 (2) of P.C. Act by causing wrongful loss to the Bank for Rs.62,88,907/-. The CBI after receipt of the complaint, registered the FIR against the appellants in FIR No.RC.20(A)/2005/BLR dated 27.09.2005, initially for the offence punishable under Section 120(B) read with Sections 409 and 420 of IPC. After the investigation the charge-sheet came to be filed for the offences punishable under Sections 120(B) read with Sections 420, 468, 471 and 477 (A) of IPC and Section 13 (2) read with Sections 13 (1) (c) and (d) of P.C. Act, 1988.14
07. Accused persons appeared before Trial Court and they have been released on bail. The charges were framed.
They have denied the charges and claimed to be tried. Accordingly, the prosecution called upon to adduce evidence.
08. To prove its case the prosecution in all examined 16 witnesses as PWs.1 to 16 and marked 166 documents and no material objects were marked. After closing of prosecution evidence, statement under Section 313 of Cr.P.C. recorded. The incriminating evidence has been read-over to accused. Their case is totally denial and they have not led any defence. After hearing arguments, the Trial Court found accused as guilty, convicted and sentenced to undergo imprisonment as under:-
i. The A.1 to A.3, A.5 to A.9 are convicted and sentenced to undergo simple imprisonment for one year for the offence punishable under Section 120B of IPC.15
ii. The A.1 to A.3, A.5 to A.9 are convicted and sentenced to undergo SI for one year for the offence punishable under Section 420 of IPC and shall pay fine of Rs.5,000/- each and in default of fine, they shall undergo simple imprisonment for 06 months.
iii. The A.1 to A.3, A.5 to A.9 are convicted and sentenced to undergo SI for one year for the offence punishable under Section 468 of IPC and shall pay fine of Rs.5,000/- each and in default of fine, they shall undergo simple imprisonment for 06 months.
iv. The A.1 to A.3, A.5 to A.9 are convicted and sentenced to undergo SI for one year for the offence punishable under Section 471 of IPC and shall pay fine of Rs.5,000/- each and in default of fine, they shall undergo simple imprisonment for 06 months.16
v. For the offence punishable under Section 477A, the A.1 to A.3, A.5 to A.9 are convicted and sentenced to undergo SI for one year and shall also pay fine of Rs.5,000/- each and in default of payment of fine, they shall undergo SI for 06 months.
vi. For the offence punishable under Section 13 (2) read with Section 13 (1) (d) of Prevention of Corruption Act, 1988, the accused No.1 shall undergo SI for 1 year and shall also pay fine of Rs.5,000/- and in default of payment of fine, he shall undergo simple imprisonment for 06 months.
09. Being aggrieved by the judgment of conviction and order of sentence the appellants are before this Court. 17
10. The learned Senior Counsel appearing for the appellant Sri P. S. Kulakarni, has contended that the accused No.1 being a Bank Manager, has accorded sanction for loan applications filed by the accused Nos.2 to 7. They have produced the documents along with the applications. The accused No.1 has sent the same to the legal advisor of the Bank. In turn the legal advisor given legal opinion. Based upon the legal opinion, the loan has been sanctioned. He has not violated any of the guidelines issued by the RBI. He further contended that even the guidelines has not been produced by the prosecution and marked before the Court to show that which of the guidelines has been violated by this appellant. He further contended that there is no sanction obtained by the prosecution to file charge-sheet against this appellants. Even otherwise there is no loss to the Bank as the borrowers repaid the loan amounts. He further contended that there is no offence to attract Section 13 of the P.C. Act to show that he has received any gratification for sanction of 18 the loan. There is no conspiracy between the this appellant and other accused for creating any documents. Absolutely there is no material to show that this appellant has cheated the Bank and participated in creating the documents. The Trial Court has drawn an inference under Section 120 (B) of IPC. There is no evidence on record against this appellant.
There is no dishonest intention to show that this appellant with a criminal intention to cheat the Bank, has granted any loan. Therefore, he has contended absolutely there is no evidence against this appellant for convict the appellant. The Trial Court has committed an error in convicting this appellant. The very complainant who registered the FIR has not been examined. The FIR was marked through the PW.15 the investigating officer, thereby the very complainant itself is not sustainable. The source report for registering the FIR also produced and marked. Therefore, prayed for allowing the appeal.
19
11. The learned counsel for the other appellants / borrowers - Accused Nos.2, 3, 6 and 8, also taken the similar contentions that they have borrowed the loan for purchase of agricultural equipments which was sanctioned after the legal opinion. The amount has been already repaid. The Trial Court has not considered the loan repaid by the appellants at all. The account has been opened and the loan amount has been transferred which was withdrawn. He further contended that the Investigating Officer - PW.15 stated in the cross- examination that the amount withdrawn by accused No.5 and only they came to know after the CBI enquiry. The accused No.3 wants money for going abroad for higher study. The property of the accused Nos.2 and 3 has not mortgaged and no documents were executed by the accused Nos.2 and 3. There is no findings given by the Trial Court in this regard. The learned counsel for the accused Nos.6 and 8 also contended that they are borrowers of Megha Cash Loan and accused No.8 was guarantor and co-applicant. There was 20 agricultural term loan obtained by accused No.8. The accused No.7 is father of the accused No.8. There is no signature of accused No.6 on the loan application, the accused No.6 is only the co-obligant for accused Nos.7 and 8. Subsequently, accused No.7 and 8 have repaid the loan amount fully. There is no default in the loan amount. There is no question of cheating and causing loss to the bank. The accused No.6 has not filed any application for loan, but the loan sanctioned and withdrawn.
12. The learned counsel for the accused No.9 has also contended that the accused No.9 is not a borrower, he is only a scribe and he has prepared the application for loan, but he has not signed. Such being the case, there is no material placed on record to show that this appellant was committed any offence. Absolutely there is no material to convict this appellant. Hence, prayed for allowing the appeal. The learned counsel for the other appellants are also taken similar contentions and prayed for allowing the appeals. 21
13. Per contra, the learned counsel for the CBI has contended that in respect of the loan sanctioned by the accused No.1 was already dismissed from service at the time of filing charge-sheet. Therefore, no sanction is required. Even if the loans were repaid that cannot be a ground for acquitting the appellants. There is a violation of guidelines issued by the RBI. The accused No.1 sanctioned the loan for pecuniary advantage as a public servant, which amounts to misconduct. The FIR was marked through Investigating Officer and that is permissible under the law. The accused No.1 has not denied the sanction of loan. His specimen signature are not required to sent to FSL for hand writing experts. When sanction of loan was not disputed, the question of proving the same does not arise.
14. The learned counsel further contended that as regards to the conspiracy, it cannot be a direct evidence, it is a matter of inference. The evidence reveals that there is collusion of accused No.1 and other accused. The prosecution 22 is successful in proving the guilt of the accused. The judgment of the Trial Court does not call for any interference. Hence, prayed for dismissal of the appeals.
15. Having heard the arguments and perused the records, the points that arise for my consideration are as under:-
i. Whether the prosecution proves beyond all reasonable doubt that the accused No.1 and other accused were conspired with each other to cheat the Bank and loan sanctioned by the accused No.1 on created and fabricated documents, which caused wrongful loss to the UCO banker, thereby the accused committed offences punishable under Sections 120(B) read with Sections 468, 471, 477 and 420 of IPC against all the accused and under Sections 13 (1) (d) read with Section 13 (2) of Prevention of Corruption Act.? 23 ii. Whether the appellant No.1 is being a public servant for illegal gratification mis-sued the power by sanctioning the loan to the other accused, thereby committed offences punishable under Sections 13 (c) (d) and 13 (2) of P.C. Act.?
iii. Whether the judgment of the Trial Court called for any interference.?
16. Before going to appreciate the evidence, the evidence adduced by the prosecution witnesses is required to be mentioned herein.
17. PW.1 - K. G. Subramanyan who was Assistant Chief Manager of the Bank, has deposed that he was working in the said Bank as a official for scrutinizing the loan. The accused No.1 was working as Manager of UCO Bank, at Davanegere. When he received the applications and loan documents and verify in connection with the Vanishree - accused No.3 as per Ex.P.1 and Rajshekharaiah - accused 24 No.4 - co-applicant, wherein he has not put his signature on the application and on the guarantor statement as per - Ex.P.2. On perusing the loan documents, he could not found the legal opinion furnished by the panel advocate. He further deposes that the loan application of the accused No.4 which is marked as Ex.P.3. The co-applicant accused No.5, was not put his signature on the application. On verifying the said loan records he found that the agricultural land was taken for collateral security. The land could not be taken as collateral security, though, it was taken as security. He further deposes that he also verified loan application of Siddalinga Swamy accused No.6 as per Ex.P.5, neither the accused No.6 nor the co-applicant accused No.9 were signed on the Ex.P.6. The guarantor statement of the accused No.9 as per Ex.P.7, where he has found, the loan records, the Megha Cash loan was granted by taking the agricultural land as a collateral security.
25
18. He further deposes that the loan application of accused No.5 - Mallamma which is at Ex.P.8, there is no process note. The accused No.1 sanctioned the loan of Rs.5,00,000/-, even though he had power to grant loan only for Rs.2,00,000/-. He has also verified the loan application of accused No.7 - Shivamurthaiah, which is at Ex.P.9, which has no process note. The guarantor - accused No.6 statement is marked as Ex.P.6. On verifying the loan documents, there was no process note in the loan application. He further deposes that the loan application of accused No.7 - Shivamurthaiah and accused No.8 Mahadevaiah is Ex.P.7 and there is no process note. The accused No.6 was guarantor, his statement is marked at Ex.P.12. The accused No.1 is power to grant loan for Rs.2,00,000/-, but he has granted loan of Rs.2,90,000/-.
19. During the cross-examination made to the accused No.1, he has admitted that Ex.P.1 is loan application of accused No.3 who is sole applicant and there is no co- 26 applicant and no signature column in the application and accused No.4 was the guarantor.
20. He further admits that as per Ex.P.58, the panel advocate given opinion in respect of properties of accused No.4 - the co-obligator. Though, he has stated that there was guidelines of RBI, where the agricultural land could not be taken as security, but he has admitted no such guidelines produced before the CBI. He further admits that there is E.M. register for verification of the loan by the Bank in every loan, but, he has not verified the E.M. register in connection with loan of accused No.4. He also admitted that the loan application was not signed by the loanee, but at subsequent stage the Manager may ask the loanee to execute fresh loan application. He further admits that the accused No.6 in Ex.P.5 not bear the signature and he has not went to the land for spot inspection. He further admits that even if the signature was not taken on the loan application, it would not effect for recovery proceedings. He also admits that he has 27 not produced the guidelines and sanction power of the Manager for granting the loan. On perusal of evidence of this witness, all the cross-examination admitted by him. He has not produced the guidelines either to the CBI or to the Court to show that there was restriction in granting the loan by accused No.1 and he has exceeded the loan. He further admits that there is no co-applicant on the loan application.
21. PW.2 - Mohemmad Gouse, who is the Retired Income Tax Officer has deposed that he was worked as I.T. Officer in Ward No.3 at Davanegere. The CBI Officer came to his office and shown two I.T. returns and he has verified the records and found that no such I.T. returns have filed in the I.T. Office. He has produced the Exs.P.13 and 14 which were copies of the I.T. returns, but no original I.T. returns were traced in his office. He has verified the Ex.P.13 which was affixed with the seal and date as 17.08.2003 and Ex.P.14 dated 05.07.2003. All these two days were holidays i.e., Saturday and Sunday. There is no possibility of receiving the 28 original I.T. returns in his office. During his cross- examination, he admits that Ex.P.13 is in respect of Ward No.3 and Ex.P.14 is in respect of Ward No.2. However, the address found in both the documents falls within his jurisdiction. He admits that he has not intimated to his supervisor regarding ward number wrongly mentioned and he has not stated before the CBI the numbers were wrongly mentioned. In the further cross-examination, he admits that the form is received in bulk and they used to give the acknowledgment on the next day if there was more work in the office.
22. According to his evidence, Exs.P.13 and 14 the Income Tax Return produced by the guarantor was a fake document and there is no original found in his office. Both the documents were said to be submitted in the I.T. office on the holidays, where no such application received physically in the holidays.
29
23. PW.3 - N. Sayi Raj another I.T. Officer of Ward No.2, has deposed that the CBI officer came and shown the Ex.P.15 the copy of the I.T returns and asked the original of the same. He has stated that the Ex.P.15 is not pertaining to his office at Ward No.2 in Shivamogga. The acknowledgment at Ex.P.15 (a) is also not found in his office. During the cross-examination he has admitted that he cannot say whether Ex.P.15 is genuine or not. He has not produced the blue book before the CBI officer, as the CBI officer has not asked that document. He further admits that without verifying the record in the I.T. office, he could not make out that they are forged documents. In the further cross- examination he stated that the accused Nos.2 to 6 have not produced the specimen seal before the CBI office and further admits that the I.T. returns pertaining to the outside jurisdiction. He further admits that the original of Ex.P.15 was filed in his office and he has sent the same to the Shivamogga Office, as it was pertaining to that jurisdiction. 30
24. PW.4 - S. Ravishankar a Deputy Chief Officer of UCO Bank, Zonal Office, at Bangalore, has deposes that he was successor to the accused No.1 who was working as Bank Manager in Davanegere Branch. In the year 2004-05 the CBI officer requested to furnish the documents in connection with the loan transaction and he has produced the same. He has stated that the Ex.P.16 is loan application of accused No.2 and accused No.4 was guarantor which is Ex.P.17. He also identified the statement of accused No.2 which is at Ex.P.18 and he has stated that process note regarding loan application by accused No.1 is at Ex.P.19, which is hand writing of accused No.1. He has also identified the legal opinion in connection with above said opinion at Ex.P.20. The Valuation Report made by the valuer - L.S. Shashidhar is at Ex.P.21. The I.T. returns of accused No.2 is at Exs.P.13 and
14. The accused No.1 prepared the attestation memo which is at Ex.P.22. The accused No.2 executed a letter of accused No.1 which is at Ex.P.23. The letter of revival executed by 31 the accused No.2 is marked at Ex.P.24. The accused No.2 executed D.P. note which is at Ex.P.25. The loan agreement executed by accused No.2 is at Ex.P.26. The accused No.2 executed a letter in favour of UCO Bank for creating mortgage deed is at Ex.P.27. The confirmation letter regarding deposit of title deed is at Ex.P.28.
25. He further deposes that the accused No.4 was a guarantor and he has executed a letter of guarantee is at Ex.P.29. The agricultural land valuation report is at Ex.P.30. The S.B. account of accused No.2 is at Ex.P.31. The accused No.1 has authorized to accused No.2 to open is at Ex.P.31
(d). The specimen signature card of accused No.1 with photo is at Ex.P.32. The declaration given by accused No.1 is at Ex.P.33. The debit letter is dated 12.06.2004 for Rs.10,00,000/- is at Ex.P.34 which is prepared by the accused No.1. The hand writing of the accused No.1 is at Ex.P.34 (a). He further deposes that the voucher dated 12.06.2004 in hand writing of accused No.1 is at Ex.P.35. 32 The credit voucher of the accused No.2 is at Ex.P.35. The accused No.2 has withdrawn the amount by check is at Exs.P.36 and 37. The statement of account of the loan is at Ex.P.38.
26. He further deposes that the Megha Cash Loan Application of accused No.3 - Vanishree is at Ex.P.1. The statement is at Ex.P.39. The letter of guarantee is issued by accused No.4 - Rajshekhar is at Ex.P.2. The accused No.1 prepared process note which is at Ex.P.40. The valuation report is at Ex.P.41. The I.T. returns of accused No.3 is at Ex.P.14. The accused No.1 prepared the attestation memo is at Ex.P.42. The accused No.3 executed a letter is at Ex.P.43. The letter of revival of accused No.3 is at Ex.P.44. The D.P. note of accused No.3 is at Ex.P.45. The loan agreement of accused No.3 is at Ex.P.46. The guarantor letter of accused No.4 is at Ex.P.47. The valuation report of the agriculture land is at Ex.P.48.
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27. He further deposes that accused No.3 has opened S.B. Account is at Ex.P.49. The accused No.1 authorized to open the account is at Ex.P.49 (d). The specimen signature with photo of accused No.3 is at Ex.P.50. The declaration form of the accused No.3 is at Ex.P.51. The debit voucher of accused No.3 is for Rs.10,00,000/- is at Ex.P.52. The accused No.1 passed order is at Ex.P.52 (a). He further deposes that the credit voucher issued by the accused No.1 for Rs.10,00,000/- is at Ex.P.53 and accused No.3 said to be received the amount and slips dated 03.06.2004 as per Ex.P.54 for received Rs.09,90,000/-. The loan application of accused No.4 is at Ex.P.3 and the statement is at Ex.P.55. However, the accused No.4 has not put his signature. The process note in tow sheets prepared by accused No.1, which is marked as Ex.P.56. The legal opinion given by Sri. M. N. Keshavan is at Ex.P.57. The valuation report of the land is at Ex.P.58. The I.T. returns of accused No.4 is at Ex.P.59. The accused No.1 attested a memo which is at Ex.P.60. The letter 34 of driver of accused No.4 is at Ex.P.61. The blank letter of revival issued by accused No.4 is at Ex.P.62. The D.P. note of accused No.4 is at Ex.P.63. The loan agreement of accused No.4 is at Ex.P.64. The letter of guarantor issued by accused No.5 is at Ex.P.65. The valuation report of the land is at Ex.P.66.
28. He further deposes that accused No.4 has opened the S.B. Account as per the application is at Ex.P.67. The accused No.1 authorized to open the account by affixing the signature. The specimen signature card of accused No.4 is at Ex.P.68. The Declaration Form of accused No.4 is at Ex.P.69. The debit voucher for loan of Rs.10,00,000/- is at Ex.P.70. The accused No.1 has issued the credit voucher is at Ex.P.71. The accused No.1 issued two cheques for receipt of amount is at Ex.P.72 and 73. The statement of account of accused No.4 is at Ex.P.74.
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29. He further deposes that Megha Cash Loan application of accused No.6 is at Ex.P.5. The statement of accused No.7 is at Ex.P.6. The accused No.1 is not signed on the Ex.P.5. The process note is at Ex.P.75. The guarantor statement executed by accused No.9 is at Ex.P.7. The opinion of the panel advocate is at Ex.P.76. The valuation report is at Ex.P.77. The memorandum of patrician is at Exs.P.78 and 79. The loan agreement of accused No.6 is at Ex.P.80. The letter of confirmation of title deeds deposit is at Ex.P.81. The letter of guarantee is at Ex.P.82 issued by accused No.9. The loan valuation report of land is Ex.P.83.
30. He further deposes that application of opening of account of accused No.4 is at Ex.P.4. Authorization to open the account issued by Krishnamurthy, the specimen signature of accused No.6 is at Ex.P.85. The declaration form of accused No.6 is at Ex.P.86. The debit voucher is at Ex.P.87. The credit voucher issued by accused No.1 is at Ex.P.88. The cheques issued by the accused No.6 for 36 withdrawing the amount is at Exs.P.89 and 90. The statement of loan account is at Ex.P.91.
31. He further deposes that the agricultural term loan application of accused No.5 is at Ex.P.8. The invoices of ESSKAY Enterprises are at Exs.P.92 to 95. The hypothecation agreement of accused No.5 is at Ex.P.96. The statement of account is at Ex.P.97. The letter of guarantee is at Ex.P.98.
32. He further deposes that application of accused No.7 and accused No.8 is at Ex.P.9. The statement of guarantor executed by accused No.6 is at Ex.P.10. Two invoices of Vani Agro Industries is at Ex.P.99 and 100. The letter of confirmation executed by accused Nos.7 and 8 is at Ex.P.101. The letter of guarantee of accused No.6 is at Ex.P.102. The Hypothecation agreement is at Ex.P.103. The attestation memo of accused No.1 is at Ex.P.104. 37
33. The loan application of accused Nos.7 and 8 is at Ex.P.11. The statement of guarantor by accused No.6 is at Ex.P.12. The Krishna Engineering Company issued invoices and another invoice of COTMAC Private Limited, issued by ESSKAY Enterprises are at Ex.P.105 to 109. The letter of depositing the title deeds is at Ex.P.110. The letter of guarantee of accused No.10 is at Ex.P.111. The hypothecation is at Ex.112. The valuation report of the land is at Ex.113. The opinion of advocate is at Ex.P.114.
34. The said witness further deposes that the credit voucher issued by the accused No.1 for Rs.3,00,000/- is marked at Ex.P.15 and attestation memo prepared by accused No.1 is at Ex.P.116. The loan opening application of accused No.7 is at Ex.P.117. The authorization of loan application also given by one Krishnamurthy. The specimen signature card of accused No.7 is at Ex.P.118. The credit voucher for Rs.2,90,000/- is at Ex.P.119. The another credit voucher of accused No.7 for Rs.1,10,000/- is at Ex.P.120. 38 The withdrawal slip of accused No.7 is at Ex.P.121. The accused No.6 received cash by withdrawal slip and withdrawal slip of accused No.7 is at Ex.P.122.
35. This witness further deposes that the memo prepared by the accused No.1 regarding loan of accused No.5 - Mallamma is at Ex.P.123. The valuation report is at Ex.P.124. The S.B. account opening Form of accused No.5 is at Ex.P.125. The authorized also issued to open the account. The specimen signature card of accused No.5 is at Ex.P.126. The Declaration Form of accused No.5 is at Ex.P.127. The debit voucher prepared by accused No.1 for Rs.5,00,000/- is at Ex.P.128. The credit voucher of accused No.1 is at Ex.P.129. The withdrawal slip of accused No.5 is at Ex.P.130. The valuation report also marked as Ex.P.131.
36. The witness further deposes that the credit voucher is at Ex.P.132. The debit voucher is at Ex.P.133. The withdrawal slip of accused No.7 is at Ex.P.134. The 39 withdrawal slip of accused No.7 is at Ex.P.135. The another withdrawal slip of accused No.7 for Rs.2,00,000/- is at Ex.P.136.
37. The witness further deposes that the accused No.5 executed the Form No.3 is at Ex.P.137. The legal opinion of the Panel Advocate is at Ex.P.138. The Declaration Form of accused No.7 - Shivamurthaiah is at Ex.P.139. The letter of deposit of title deeds is at Ex.P.140. The letter of confirmation issued by accused No.6 deposit of title deeds is at Ex.P.141. The accused No.6 has also executed the another letter for depositing the title deeds for creating mortgage is at Ex.P.142.
38. This witness further deposes that the accused No.9 - Srikanth Kulkarni, was executed a letter of guarantee is at Ex.P.143. The accused No.5 executed a consent letter is at Ex.P.144.
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39. The statement of account with Megha Cash Loan of A2 is at Ex.P.145. The statement of account of accused No.3 - Vanishree regarding Megha Cash Loan is at Ex.P.146. The statement of account with regard to Megha Cash Loan of accused No.4 is at Ex.P.147. The statement of Megha Cash Loan of accused No.6 is at Ex.P.148. The statement of account regarding loan application of accused No.5 is at Ex.P.149. The statement of account of accused No.7 is at Ex.P.150. The credit voucher in the hand writing of accused No.1 is at Ex.P.151. The amount Rs.2,00,000/- credited to the account of accused No.6 and the valuation report of agricultural land is marked as Ex.P.152.
40. In the cross-examination of the learned counsel for accused No.1, he has admitted that he has not gone to the land of the PW.1 and further admits that the legal opinion issued for granting loan of accused No.2 as per Ex.P.2. He further admits that the accused No.1 received the 41 valuation report as per Ex.P.21 for granting loan to the accused No.2.
41. He further admits that he has not furnished the documents before the CBI regarding guidelines for sanction of Megha Cash Loan. He further admits that as per Ex.P.20 the title of property was perfect and mortgage could be created. He further admits that the lands documents are furnished for collateral security for Megha Cash Loan. The said lands standing brought to the sale in the Final Decree Proceedings if decree was passed. Though, he has denied that the agricultural land cannot be taken as collateral security for Megha Cash Loan, but he has not produced the such prohibition for taking decision as security.
42. He further admits that he cannot say that the valuation mentioned in the Ex.P.41 regarding loan application of accused No.3 was just and proper for recovering the loan granted to the accused No.3. He further admits that the accused No.4 also obtained the loan and loan was granted 42 after verifying the require documents and legal opinion of the panel advocate is at Exs.P.58 and 59. He further admits that the accused No.5 was also availed loan by producing the valuation report as collateral security. He further admits that accused Nos.7 and 8 were availed loans by producing the loan application. The legal opinion was obtained from the advocate as per Exs.P.76 and 77.
43. In the cross-examination the learned counsel for accused Nos.2 to 6 further admits that if the application filed by single person, he could allow to sign the application. The Bank has receives huge number of applications for grant of Megha Cash Loan. The loan used to be sanctioned after verifying the documents. He further admits that the loans were sanctioned after producing the title deeds and the loan application of the accused No.2 was filed. The account was opened by accused No.3 introducing by an advocate one Basappa. The accused No.3 filed loan application and later the amount has been withdrawal.
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44. He further admits that the accused No.4 introduced Advocate - Kotrappa. The Ex.P.67 opening of the S.B. account. The loan was sanctioned. The Kotrappa introduced accused No.6. The accused No.6 was guarantor for agricultural loan of accused Nos.7 and 8. The accused No.6 deposed that the title deeds and he was surety to the accused Nos.7 and 8. He further admits that the accused Nos.7 and 8 are not default in payment and they paid the amount.
45. On perusal of the evidence of this witness, it shows that the loan application was filed by accused Nos.2 to 8, amongst them, they have given security by producing the letter of confirmation as a guarantor. They have submitted the title deeds. After verifying the documents the loans were sanctioned after obtaining the legal opinion from the panel advocate. It is also seen that the violation alleged against accused No.1 that he has sanctioned the loan by taking the agricultural land as collateral security which is violation of the 44 guidelines, but no such guidelines produced by the prosecution and marked to show that there was violation of norms as committed by the accused No.1 while sanctioning the loan. It is admitted fact that prior to the sanction of loan, the valuation report and legal opinion received by the accused No.1, then sanction order was passed and loan were disbursed and withdrawn by the other accused persons. Later the loan amount were repaid by the borrowers and evidence of this witnesses which is not used for prosecution.
46. PW.5 - Sri. M. N. Keshavan, is the panel advocate for the Bank. He has deposes that he has issued the legal opinion as Ex.P.20 for loan belongs to accused No.2. The Ex.P.153 is his covering letter. The legal opinion given to the accused No.5 is at Ex.P.57 and legal opinion is at Ex.P.58 regarding the loan of accused No.4. The Ex.P.76 is the legal opinion for loan application of accused No.6. The Ex.P.114 is the legal opinion for loan of accused No.7. The Ex.P.138 is the legal opinion for loan of accused No.4. He further says 45 that he has furnished the legal opinion and send to the accused No.1 with covering letter. In the cross-examination he has admitted that Ex.P.57 is opinion regarding Mallamma and Ex.P.58 is valid title deed belongs to the Rajashekaraiah. Ex.P.77 is valid title deed of the Siddalingayya and he has given opinion that mortgage can be created through registered instrument as all the documents are valid documents including the title deeds of Shivamurthy as Ex.P.114. Accordingly, he has given legal opinion for the loan pertaining to the accused persons based upon the documents. His evidence is not useful to the prosecution, on the other hand it is helpful to the accused No.1.
47. PW.6 - Kubero Naidu who is the businessman running the shop in the name of ESSKAY Pipe Centre dealing with P.V.C. pipe and plumbing material. He deposes that about 04 years back the CBI officer enquired about the invoice at Exs.P.108 and 109 which were not issued by him and they are not in his hand writing. The letter head used is 46 not of his shop. He also verified Ex.P.94 and Ex.P.95 invoices shown to him and he has identified that those are the quotations which is in his hand writing. He has not stick the quotation and he has not written the bill and he has not supplied the material shown in Exs.P.94 and 95.
48. During the cross-examination he has stated that there were 04 persons working in his shop and in his absence his Manager use to write the bills and issue the quotation. Exs.P.94 and 95 are in his hand writing. He has not enquired his Manager about over writing on the originals and he cannot say who obtained the quotation from his shop and denies the Exs.P.108 and 109 were not issued from his shop. He has also deposes that he has enquired officials of the shop, they have also told that it was not issued by them. However, he admitted in the cross-examination by the learned counsel for the accused Nos.2 to 6 that Exs.P.95 and 96 were issued in the name of Mallamma - accused No.5. 47
49. On perusal of his evidence it shows that though quotations were issued as per Exs.P.94 and 95 in the name of Mallamma - accused No.5, but the invoices as per Exs.P.108 and 109 were not issued by him and he has also stated that no materials were supplied, as per the quotations.
50. PW.7 - Mruthunjaya M.S. an accountant in ESSKAY enterprises also deposes that the CBI police officials shown the Exs.P.92 and 93 to verify whether the same were issued by his enterprises. He has also stated that Exs.P.92 and 93 are the quotations, but not bills. He has also verified the Exs.P.106 and Ex.P.107 and stated that the said bills were not issued from their shop. In the cross-examination of learned counsel for accused No.1, he has admitted that there are 4 to 5 persons were working. The owner alone issued the quotations and he has not enquired with the officials whether Exs.P.92 and 93 were issued by them. He admits that there is no legal Bar for issuing typed bills and Ex.P.107 contains 48 the CST and KST numbers. In the cross-examination of accused No.9 he has stated that Srikant Kulakarni not the proprietor. He admits in the cross-examination of learned counsel for accused Nos.2 to 6 that the Exs.P.92 and 93 are in the hand writing of Sri. V.N. Srikant and further admits that anybody can avail the quotation in the name of others.
51. PW.8 - Chandrashekhar A. H. who is a businessman running a Vani Agro Industries, dealing in Tractor, Trailer and Accessories. He has deposed that the CBI police enquired about Ex.P.99. He has stated that it was not issued by him and the letter head also not belongs to his industries. The hand writing also not that of him or his employees. He has also deposes that the Ex.P.100 is quotation, it was issued by his industries one Sri. Wagesh, Sales Executive put his signature, but he has stated that they have not supplied the materials for Rs.1,47,100/-. In the cross-examination, he has admitted that Exs.P.99 and 100 contains the CST and KST numbers and both the 49 documents are having the name of similar letter head and ordinary person cannot make out the creation. According to his evidence though quotations were issued for showing the value of the materials, but no materials were supplied for the said amount.
52. PW.9 - K. Shivaraj, the Assistant Manager in COTMAC Private Limited, has deposed that the CBI officer shown the quotation as per Ex.P.106. He has stated that it is not issued by his concern and hand writing is also not that of himself. In the cross-examination, he has stated that on looking to the Ex.P.106, he cannot say whether it is created or not. In the further cross-examination of accused Nos.7 and 8, he has admitted that there are separate letter heads for issuing quotation and issuing bills. The CBI officers have not collected the letter head with the logo of their concern.
53. PW.10 - V.J. Umesh, another businessman of Krishna Engineering Company also deposed that the CBI officers have shown the Ex.P.105 the quotation and enquired 50 about it, but it was not issued by him and they are not having any printed quotation, but they are using to issue quotation in the letter head of his shop. In the cross- examination, he has stated that Ex.P.105 contains the CST and KST numbers and also stated that he cannot say whether it was issued by his shop or created one and he is only a partner and identified the Ex.P.105. Accordingly, as per this witness the Ex.P.105 was not issued by him.
54. PW.11 - Sri. N. K. Rajakumar, who is a consulting engineering running a Firm in the name of R.K. Associates and he is also doing as authorized valuer of UCO Bank Davanagere and also other Banks. In the year 2006 the PW.4 requested to undertake the value of 05 properties. Accordingly, he has visited the spot and valued the properties and prepared the valuation report. Ex.P.30 is the valuation report in respect of land in Sy.No.53/1B2 measuring 02.21 guntas situated at Bannikode village and he has valued the land at Rs.2,44,925/-.
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55. He further deposes that he also valued the land Sy.No.52/3 measuring 02.14 guntas of Bennikode village as per Ex.P.48 and valued the land at Rs.2,27,950/-.
56. He further deposed that he valued the land Sy.No.133/1B measuring 07 acres 02 guntas, Sy.No.53/2 measuring 02.28 guntas, Sy.No.62/P1 measuring 01.07 guntas and Sy.No.133/P11 measuring 02.20 acres and given valuation report as per Ex.P.66 and he has valued the above said lands at Rs.24,89,000/-.
57. He further deposes that he has also valued the land Sy.No.133/P10 measuring 03.02 guntas of Bennikodi village as per Ex.P.83 and valued at Rs.5,07,800/-. He has valued the land Sy.No.31/1P measuring 05 acres situated at Muktenahalli village and issued the report as per Ex.P.131 and valued at Rs.4,85,000/-.
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58. In the cross-examination of learned counsel for the accused No.1, he has admitted that the Davanagere was under CMC Limit during the year 2005-06. The lands surrounding the Davanagere has been escalated. He has adopted the value as per the Sub-Registrar, but he has not enclosed the documents along with the valuation report. He further admits that he himself went to there and no other engineer were accompanied him. He has not referred the valuation report submitted by the accused persons. He further admits that there is a difference in value of the Government as well as forced value and market value. He further admits that in the forced value a person sell the property under the circumstances and market value is existing surrounding the area. The comparative value means the value adjoining with the adjoining properties. He further admits that he has not mentioned all the 03 values.
59. According to his evidence, he has valued the property as per the value of the Sub-Registrar for the 53 purpose of purchase of stamp and registration. He has not mentioned the market value surrounding the area and there will be difference in value between guidance value and market value.
60. PW.12 - W. Gladys Jayanthi, the Police Inspector working in CBI has deposed that on 10.10.2005 she has collected specimen signature of the accused No.2 Siddaveriaha, accused No.3 - Vanishree, accused No.5 - Mallamma, accused No.6 Siddalingaswamy, accused No.4 - Rajashekhariah, accused No.7 - Shivamurthaiah and accused No.8 - Mahadeviah. He has identified the signature of accused No.2 as per Ex.P.154, signature of accused No.3 is at Ex.P.155, signature of accused No.6 is at Ex.P.156, signature of accused No.5 is at Ex.P.157, signature of accused No.8 is at Ex.P.158, signature of accused No.9 is at Ex.P.159 and signature of accused No.4 is at Ex.P.160. He has hand-over the same to the investigation officer. In the cross-examination of accused Nos.2 to 6, he has admitted 54 that he has not mentioned in the Ex.P.154 to 160 regarding the name and address of the witnesses who are present at the time of taking the specimen signature.
61. PW.13 - B. V. Nilkanta Joish, the Zonal Manager of UCO Bank, deposes that when he was working as Deputy Chief Officer Inspector UCO Bank, Bengaluru, he directed by the DGM to inspect the UCO Bank at Davanegere. Accordingly, he has visited the Branch. PW.4 the Manager, he has noticed that accused Nos.2 to 4 and 6 were sanctioned and disbursed the Megha Cash Loan. The accused No.1 was the Manager who has sanctioned the loan based on the security of agricultural land. The loanees produced the loan documents, but details of occupation were not collected. The proof of income was not collected. The installment were fixed without considering the repayment capacity of the borrowers. The loan applications were incomplete. He further deposes that accused No.1 sanctioned and disbursed the loan to accused No.5 - Mallamma, accused No.7 - Shivamurthy, 55 accused No.8 - Mahadevaiah and the process was not properly done. The repayment fixed without considering the capacity of the loanee and he has prepared report and given to the Zonal office.
62. In the cross-examination he has admitted that he has not produced the guidelines regarding various loans and also admits that whether the guidelines were submitted to the CBI officer or not. He further admits that in the loan application of accused No.2, the occupation is shown as agricultural and there is no I.T. returns produced to show the income of the loanee. He further admits that he do not know whether the loans of accused Nos.7 and 8 were already been discharged and payments were made by them.
63. He further admits that if the payment are not made, it would not effect the interest of the Bank and hamper the recovery. He do not remember whether he has verified EM creation register and he has also admits that he has not verified the EM creation of register of loans of 56 accused Nos.2 to 4 and 6. He has not produced the copy of his report to CBI officer and he further admits that he has not seen the recovery report regarding recovery of loan granted in favour of the accused.
64. PW.14 - Shankar Naik head casher of the UCO Bank deposed that the Ex.P.6 is the cheque for having made the payment Rs.3,90,000/-, Ex.P.37 is the cheque for Rs.6,00,000/-, Ex.P.54 is the withdrawal slip of Rs.9,19,000/-, the Ex.P.72 is the cheque is for Rs.5,00,000/-. Ex.P.73 is the cheque of Rs.4,90,000/-. The Ex.P.89 is the cheque for Rs.7,90,000/-. The Ex.P.19 is the cheque for Rs.2,00,000/-, Ex.P.130 is the withdrawal slip for Rs.4,95,000/-. Ex.P.134 is the withdrawal slip of Rs.3,00,000/-, Ex.P.135 is the withdrawal slip for Rs.2,50,000/-. Ex.P.136 is the withdrawal slip of Rs.4,00,000/-, Ex.P.73 is the cheque is for Rs.4,90,000/-. Ex.P.36 is the cheque of Rs.3,90,000/-. He has made the payment to the persons.
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65. In the cross-examination of the learned counsel for accused No.1 submits that he has not stated in his statement that the amounts were released from the Chamber of accused No.1 and this witness is having separate cabin. In the further cross-examination of accused Nos.2 to 6 he has admitted that he has not having any idea that accused Nos.7 and 8 are permanent customer. The Kotrappa, the learned advocate who was permanent customer who is introduced the accused Nos.7 and 8.
66. According to his evidence the loans amounts were disbursed to the accused on the withdrawal slip produced by them. Since, the loan sanctioned, disbursement and repayment were are not in dispute.
67. PW.15 - Hariom Prakash the investigating officer has deposed that when he was working as police inspector in CBI ACB Bengaluru the S.P. Biju Jorge registered the FIR in RC.No.20(A)/2005 and the FIR is identified by him as per 58 Ex.P.161. He further deposes that the S.P. entrusted him for investigating the matter. On 20.12.2005 he recorded the statement of PWs.8, 10 and statement of PW.1 on 09.03.2006. He has recorded the statement of other witnesses on various dates. He has collected the specimen signature of accused No.1 as per Ex.P.162. Then he has entrusted the part of the investigation to PW.12.
68. He further deposes that on 12.08.2006 he has sent specimen signature along with the questioned documents to the Hyderabad for getting opinion. The specimen writing of accused No.9 is Ex.P.163 and opinion is at Exs.P.164 and 165 and then he has completed the investigation and the charge-sheet has been filed.
69. Since, accused No.1 was dismissed from the service the sanction is not necessary, hence he has not obtained the sanction.
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70. In the cross-examination of the learned counsel for accused No.1 this witness has stated that he has prepared the documents and seizer memo for collecting the documents in different dates, but he has not produced the seizer memos. He further says that he has visited the UCO Davanagere Branch, but he has not seized the attendance register from the Branch. This witnesses denied all the suggestions made by the learned counsel for the accused persons.
71. PW.16 Suryaprasad a Deputy Government Examiner Hyderabad has deposed that on 14.08.2006 his office received, the questioned and standard documents and he has received the same as per Q1 to Q387, Q389 to Q493, Q495 to Q606, with some marking specimen writings in 14 sets as per S1 to S94 and S44(a). He has compared the same and given opinion as per Exs.P.165 and 166. 60
72. He further stated that one Gopal was undertaking the work of examination of the above documents. He put his signature as Ex.P.165 (B). In the Ex.P.165 the Para Nos.1 to 6, Para Nos.12 to 14, are his opinion.
73. In the cross-examination of the learned counsel for accused No.9, he has admitted that the CBI officer has not sent the admitted writing and admitted signature for identification. But he further denies that without being admitted signature, one could not undertake work of comparison perhaps one could not furnish opinion.
74. On considering the evidence on record, the allegation made against the accused No.1 who is the Manager of the UCO Bank at Davanagere Branch, who is said to be conspired with the accused Nos.2 to 9 has created the documents. The accused No.1 sanctioned the loan to the accused Nos.2 to 9 without following the guidelines, even though he do not have power to sanction the huge loan. 61
75. Before going to appreciation of the evidence, it is worth to mention some of the admitted facts in this case as under:-
i. It is not in dispute that the accused No.1 - Shiva Kumar was the Branch Manager of UCO Bank at Davanagere. ii. It is also not in dispute that the accused Nos.2 to 8 have filed loan applications for grant of Megha Cash Loan and Agricultural Loan.
iii. It is also not in dispute that the accused Nos.2 to 8 have filed the quotations for the purpose of purchasing the agricultural equipments along with the valuation report of the agricultural land which were furnished for the purpose of the security for the loan. iv. It is also not in dispute that the accused No.1 after receipt of the loan applications forwarded the applications to PW.5 - Keshavan, panel advocate for legal opinion and he has furnished the legal opinion based upon the legal opinion, the loans were sanctioned.62
v. It is also an admitted fact that the loans were disbursed to the accused persons to their loan account opened by them in the UCO Bank and they have withdrawal the loans by producing the withdrawal slips and cheques. vi. It is also not in dispute that subsequently the said loans were repaid by the borrowers to the Bank.
76. Now, the allegation against the accused Nos.2 to 9 are that they have produced the fabricated documents and fake documents for the purpose of borrowing loan, which was not properly verified by the accused No.1 and sanctioned the loan.
77. The learned counsel for the accused mainly challenged the judgment on the ground that:-
i. No sanction was obtained under Section 19 of the P.C. Act, while filing the charge-sheet, ii. There is no evidence or documents to show that the accused No.1 conspired with the accused persons while sanctioning the loans, 63 iii. The author of the complaint or FIR is one S.P. Biju George, was not examined and mere marking the FIR through Investigating Officer cannot be accepted. iv. The report of the PW.13 shows that he has inspected the office and verified the documents. Thereafter, given the report but the said report is not produced and marked before the Court.
v. Admitted and disputed signatures were not separately sent for getting expert opinion. Therefore, the opinion of the PW.16 is not conclusive and not reliable to prove the charges under Sections 120 (B), 468, 471 and 477 (A) of IPC.
vi. The guidelines issued by the RBI regarding following the procedure by the Bank while sanctioning the loan and the guidelines stating that no agricultural land shall be taken as security for the loan has not been produced and marked.
64vii. The loans were sanctioned purely based upon the documents verification and opinion given by the panel advocate of the Bank - PW.5 - Keshavan.
viii. Further, contended that the Trial Court accepted the evidence of the prosecution witnesses and it is only stated in the chief examination, but not considered the cross-examination.
78. On verifying the ground No.1 regarding sanction under Section 19 of the P.C. Act, it is argued by the respondent's counsel that at the time of filing the charge- sheet the accused No.1 was already dismissed from the service. Therefore, the sanction is not required. The investigating officer - PW.15 has also stated the same.
79. On the other hand, the learned counsel for the appellants relied upon the judgment of this Court in the case of State of Karnataka vs V. Chandrashekhar, reported in 2022 (3) KCCR 2257. The learned counsel for the respondent has contended that for the purpose of filing the 65 charge-sheet under the IPC cases, no sanction under Section 197 of Cr.P.C. is required. In support of his contention the learned counsel for the respondent relied upon the judgment of the Hon'ble Supreme Court reported in (1999) 5 SCC 690 in the case of State of Kerala vs. V. Padmanabhan Nair.
80. On perusal of the judgment of the Hon'ble Supreme Court in the case of V. Padmanabhan (Supra), the Hon'ble Supreme Court held that when the offence committed by a government servant, if it is punishable under Sections 409 and 406 of IPC, for criminal breach of trust, the misappropriation of fund and conspiracy for the offence punishable under Section 120 (B) of IPC, the sanction under Section 197 of Cr.P.C. is not necessary. It is also held that under the prevention of Corruption Act 1947, when the accused seized to a public servant on the date of taking cognizance of offence under the P.C. Act, the sanction is not necessary.
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81. On the other hand, the learned counsel for the appellant relied upon the judgment of the Coordinate Bench of this Court in the case of V. Chandrashekhara (supra) wherein the Coordinate Bench has held that the amendment to the Prevention of Corruption Act in the year 2018, the sanction under Section 19 of P.C. Act, has been inserted by removing the earlier provision. Therefore, the amendment by insertion of Section 19 of P.C. Act, is came into force from the inception of the Act, from the year 1956. Enactment of the law and the Coordinate Bench placing reliance of the judgment of the Division Bench of this Court in the case of Pusphalata N.V. vs. P. Padma and others, reported in 2010 KAR 1484, has held that the Section 19 of the P.C. Act, has been inserted by deleting the earlier provision which among to the enactment of Section 19 of P.C. Act, enactment of the statute and Section 19 is given retrospective effect, at Para No.15 has held as under:-
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"Thus seen, it may be stated that the
amendment brought to Section 19 of the
Prevention of Corruption Act by Act No.16 of 2018 is to be understood as if it came into effect from the date the Prevention of Corruption Act was first given into effect i.e., from 09.09.1988. This being the change in law, definitely the respondent can contend that be cannot be prosecuted without sanction and his retirement from service does not make any difference in the matter of obtaining sanction. Therefore, the argument of Sri. B. S. Prasad cannot be accepted. I do not find any infirmity in the ultimate conclusion taken in the impugned order to discharge the respondent. The revision petition fails and it is dismissed."
82. The judgment of the Hon'ble Supreme Court is based upon the unamended P.C. Act, 1947 and even unamended P.C. Act, 1988 the sanction under Section 19 of P.C. Act, is not necessary when a public servant seized to be a public servant either by a dismissal or retirement by superannuation or otherwise. Whereas, the amended Act, 68 2018, Section 19 of the P.C. Act, was inserted by deleting the earlier provision where the sanction is necessary. However, in the present case, the offence was committed and FIR was registered in the year 2005 and judgment was delivered by the Trial Court was on 05.07.2011, this appeal is also filed in the year 2011. Therefore, once the police already filed charge-sheet under unamended Act of P.C. Act, at that time Section 19 of P. C. Act, is in force and there was no sanction is necessary under Section 19 of the P.C. Act, and Section 197 of Cr.P.C. was also not necessary when the alleged offences have committed under the IPC Sections 406, 409 and 120 (B) of IPC. Therefore, while filing the charge- sheet in the year 2008 by the CBI, sanction was not necessary where the Section 19 of P.C. Act, was in force. Therefore, merely the pending appeal is nothing but continuation of original proceedings, but the sanction was not necessary at the time of filing charge-sheet under the P.C. Act and IPC against the accused No.1. Therefore, the 69 contention of the learned counsel cannot be acceptable, that sanction is necessary for taking cognizance.
83. The second contention of the learned counsel for the appellants is that regarding criminal conspiracy under Section 120 (B) of IPC was not proved.
84. On perusal of the entire evidence on record including the evidence of Bank Officials, the PW.1 or PW.4 were all deposed before the Court including the Investigating Officer. There is no evidence adduced to show that this accused No.1 conspired with the accused Nos.2 to 9 while granting the loan based upon any fabricated documents. Neither oral evidence nor any written documents or positive evidence adduced by the prosecution to show that any of the day these accused persons were conspired with intention to commit the offence either cheating or fabricating the documents. On the other hand, the loan applications were filed by accused Nos.2 to 7 independently in the Bank. It was 70 processed by the Bank Officials and finally the documents were sent to the Manager - the accused No.1 and in turn the accused No.1 referred the documents to the PW.5 panel advocate of the Bank for legal opinion for sanction of loan. Admittedly, as per the evidence of the PW.1, he has given the opinion for granting the loan after verifying the documents stating that the title were perfected and opinion was given as per Exs.P.57, 58, 76 and 114. Based upon legal opinion the loans were sanctioned. Therefore, absolutely there is no evidence to show that there was conspiracy between accused No.1 and other accused in sanctioning loan by accused No.1 to the accused Nos.2 to 7. Therefore, Section 120 (B) of IPC went unproved by the prosecution.
85. As regards to the third contention, the author of the FIR one S.P. Biju George was not examined and the complaint and FIR has been marked through the PW.15. Therefore, it is contended that the very complaint itself is not proved by the prosecution. Herein in this case admittedly, 71 the CW.19 the S.P. Biju George has not been examined and no evidence adduced by the prosecution not able to secure his presence and examining him as witness before the Court. On the other hand, the PW.15 has stated that FIR has been registered by the S.P. and he has been authorized to investigate matter. Of course FIR is marked at Ex.P.161. The contents of the FIR has been proved by the prosecution by examining the PW.15. It is well settled that mere marking the documents, is not a proof and when the accused were disputed the case, it is necessary for the prosecution to prove the FIR, which is base for investigation and filing the charge-sheet. However, it is a Bank fraud case, where the accused No.1 - Bank Manager is involved, based upon the statement of the PW.1 and PW.4, the FIR was registered by the one Biju George, S.P. and the FIR has been marked through the PW.15 and he has spoken with the contents of the FIR and this Investigating Officer is familiar with the identification of signature of the S.P. Such being the case, 72 the question of contending the FIR was not proved, is not sustainable. The FIR is necessary for setting the law into motion for the purpose of investigation. Therefore, non- examination of the S.P. is not fatal to the prosecution case.
86. As regards to the hand-writing opinion the PW.16 given evidence that he has received the documents from the Investigating Officer in respect of questioned documents and admitted documents with regard to specimen hand-writing as per Exs.P.165 and 166. As regards to the sanctioning of the loan by this accused No.1 in favour of accused Nos.2 to 7 are not in dispute and if any documents produced by the borrower for applying loan along with the loan application, the manager cannot go into the genuinity of the documents while granting the loan. It is his duty to refer the documents to panel advocate for getting legal opinion. Accordingly, legal opinion has been given by the PW.5 - Keshavan, thereafter he has granted the loan. Therefore, question of creation of document or production of fake documents or fabricated 73 documents by accused No.1 for offences punishable under Sections 468, 471 and 477 (A) will not attract against accused No.1, as this Court has already held that conspiracy of Section 120 (B) of IPC is not proved by prosecution. Therefore, offences alleged against accused No.1 in respect of fabrication of documents or creation of fake documents or cheating Bank would not attract against accused No.1. The fabrication of documents done by other accused, not by this accused No.1. Hence, he cannot be convicted for offence punishable under Section 477(A) of IPC. Therefore, evidence of PW.16 the expert opinion not useful to the prosecution case to prove guilt of accused No.1. Therefore, accused No.1 cannot be convicted for above said offences.
87. The another contention taken by the appellant's counsel is that the allegation against accused No.1 was that he has violated guidelines issued by the RBI and he has sanctioned the loan based upon the opinion of the panel advocate PW.5. Admittedly, the PW.5 - Keshvan the panel 74 advocate has admitted in the evidence that he has given opinion for sanctioning of loan after verifying the documents referred by accused No.1 for legal opinion. Whether agricultural land cannot be taken as security for the loan or not any violation of guidelines or not, it has to be verified by the PW.5 panel advocate while giving opinion. Admittedly, the panel advocate given opinion in all the cases, after verifying valuation report, land documents and agricultural or non-agricultural, but he has given opinion as per Exs.P.57, 58, 76, 138 and also admitted in cross-examination that as per Ex.P.77, PW.14 also admitted that the documents produced by the borrower can be accepted for the purpose of creating mortgage for loan as security.
88. That apart the guidelines of RBI is not produced and not marked in order to show that accused No.1 has violated the guidelines and sanctioned the loan. That apart the loan was sanctioned by the accused No.1 based upon the legal opinion of the panel advocate. Therefore, it cannot be 75 said that the accused No.1 intentionally or willfully violated the conditions or guidelines while sanctioning the loan. The prosecution utterly failed to prove the allegation made against the accused No.1.
89. Apart from that there is no evidence on record to show that the accused No.1 misused his official position as a public servant colluded with the accused - borrowers and created any documents for any illegal gratification. Absolutely, there is no evidence collected to show that he has sanctioned the loan for any pecuniary benefit. Therefore, I hold that the prosecution has failed to prove any of the charges leveled against the accused No.1 either under IPC or under the Prevention of Corruption Act.
90. The Trial Court has not appreciated the evidence of the prosecution witnesses and admissions made by the PW.1, PW.4, PW.5 and the Investigating Officer-PW.15, which are all in favour of the accused which goes against the 76 route of the prosecution case. The Trial Court simply based upon the examination-in-chief of the prosecution witness convicted the accused No.1 - appellant which is illegal and perverse. Hence, this Court required to be interference in respect of conviction and sentence passed against accused No.1.
91. As regards the allegations made against the accused Nos.2 to 8 that they have created the false documents and obtained the loan. As I have already stated above, the filing of applications for loan, sanctioning the loan, disbursing the loan and receiving the loan, were all not in dispute.
92. As regards to the accused No.2 - Siddaviraiah who was one of the borrower. He has also borrowed the loan by filing application before the accused No.1 and as per the evidence of PW.4 the accused loan application is Ex.P.16 and the accused No.4 offered surety as per Ex.P.17. The 77 statement of the accused No.2 is Ex.P.18 and process note issued by the accused No.1 is Ex.P.19. The I.T. returns filed by the accused No.2 is Exs.P.13 which was proved by the prosecution as fake I.T. returns by examining the PWs.2 and 3 the Income Tax officials who have categorically stated that no I.T. returns produced before the authority. As regards to the borrowing the Megha Cash Loan, sanction of loan, disbursing the loan, withdrawal of the loan amount, is not in dispute. The accused Nos.2 and 4 borrower were guarantors also filed fake documents and produced as genuine documents by forging the seal and signature of the Income Tax Officer, whereby prosecution is successful in proving the guilt of the accused No.2.
93. The accused No.3 - Vanishree filed an application for borrowing the loan along with the documents. The accused No.4 - Rajashekhariah was the co-applicant. The Ex.P.1 is the loan application of accused No.3. The Ex.P.2 is the document produced by the accused No.3. Admittedly, 78 these documents referred to the panel advocate for opinion. Accordingly, he has given opinion and loan were sanctioned. Though, it was alleged that there is no legal opinion, but the PW.5 has admitted that he has given legal opinion. Further more, in the cross-examination, he has admitted that the accused No.3 was the sole applicant and there is column for putting signature by the accused No.4 as a guarantor. There is positive evidence to show that accused No.3 has created document for the purpose of borrowing the loan. However, she has received the loan and disbursed the loan amount and she has declared in Ex.P.51 and received Rs.10,00,000/- as per Ex.P.52. The evidence of PW.4 where he has stated that the accused No.3 produced the loan statement as per Ex.P.39 and letter of guarantee is issued by PW.4 is at Ex.P.2. The accused No.3 has also filed a valuation report as per Ex.P.41. The I.T. returns filed by accused No.3 is as per Ex.P.14 and Ex.P.43 is letter executed by accused No.3. Letter of revival issued by accused No.3 is at Ex.P.44 and 79 valuation report of the accused No.4 who is a guarantor as per Ex.P.48. Now, the allegation is that the Ex.P.14 the I.T. returns produced by accused No.3 was fake one. In this regard, PW.2 Mohd. Gouse the I.T. officer Ward No.3 at Davanagere, has deposed that the CBI officials produced the Ex.P.14 and request for verification where he has verified the seal dated 05.07.2003 alleged to have been filed the I.T. returns, which was on holiday and Ex.P.14 is in respect of Ward No.2. According to his evidence the Ex.P.14 is I.T. returns are fake documents and there is no original found in the I.T. office. The evidence of the PWs.1, 2, 4 and PW.15 the Investigating Officer and PW.16 which clearly reveals that the accused No.3 produced the I.T. returns as per Ex.P.14 which is not a original I.T. returns, which was filed before the Income Tax Authorities, but it was a created document. Even the seal under acknowledgment and the Ex.P.14 were all a bogus seal in order to show that the accused No.3 filed the Income Tax before the Income Tax 80 Authorities. But these documents were produced before the accused No.1 for seeking loan and the counsel for accused No.3 has not led any evidence to show that any books of account or any of the documents to show that she has continuously filed any I.T. returns and the Ex.P.14 was genuine document. Therefore, the prosecution able to establish that the accused No.3 produced the fake documents along with the loan application for sanctioning of loan.
94. As regards to the accused No.4 who also guarantor to the loan borrowed by accused No.3, he has also borrower of the loan. His loan application is marked at Ex.P.3. The accused No.5 was the co-applicant and the accused No.5 offered the surety regarding agricultural land. The valuation report of the accused No.4 is at Ex.P.48 and the letter of guarantor issued by accused No.4 in favour of the accused No.3 is at Ex.P.47. The letter of revival loan of accused No.3 is Ex.P.44. The process note of accused No.3 is 81 at Ex.P.45. The letter of guarantee issued by accused No.4 is Ex.P.2. These documents were verified by the PW.5 and given opinion and later the loan has been sanctioned. There is no complaint that the accused No.4 created any false documents and produced as guanine for offering surety to accused No.3 or borrowing the loan for himself, where the accused No.5 offered the surety to him. Merely, the accused No.4 not affixed his signature, that cannot be a ground to show that he has committed any offence. The I.T. returns of accused No.4 is marked at Ex.P.59, but there is no allegation that accused No.4 also filed any bogus I.T. returns. On the other hand, the Ex.P.14 was the I.T. returns of accused No.3 which was found bogus and fake one, where the accused No.4 was guarantor. Hence, it cannot be said that the fake documents are filed by the accused No.3.
95. As per the evidence of PWs.1 and 4, the accused No.6 also borrowed the loan by filing Megha Cash Loan Application as per Ex.P.6. The process note is at Ex.P.75. The 82 accused No.9 filed guarantor statement as per Ex.P.7 and the panel advocate given opinion as per Ex.P.76. The accused No.6 given valuation report as per Ex.P.77. The memorandum patrician are at Exs.P.78 and 79. The loan agreement of accused No.6 is at Ex.P.80. The letter of confirmation of title deed is at Ex.P.81. The letter of guarantee is at Ex.P.82, which was issued by accused No.9. The valuation report is at Ex.P.83 and the accused No.6 received the loan amount by opening the account and withdrawing the amount as per Exs.P.85 to 90. Ex.P.91 is the statement of loan account. These documents were not in dispute. The main allegation against accused No.5 is that he has produced the invoice from the ESSKAY enterprises, where it is alleged that this invoices obtained by ESSKAY enterprises were all bogus one. To prove the same, the PW.7
- Mruthunjaya who is an accountant from ESSKAY enterprises examined. He has identified the Exs.P.92 and 93 are the quotations, but they were not the bills. The Exs.P.106 83 and 107 are alleged bills said to be issued from the ESSKAY enterprises, but they have stated it is not the bills issued by their company and no goods were supplied and they have not received any money from the said borrowers.
96. On perusal of the evidence of PWs.1, 4 and 6 and PW.15 - Investigating Officer evidence, it shows that the accused No.4 borrowed the loan for the purpose of purchase of agricultural equipments by producing the quotations as per Exs.P.92 and 93, but the bills invoices produced obtained from ESSKAY enterprises were a fake documents. The loans were granted for the purpose of purchasing the agricultural equipments and the quotations and invoices produced by the accused No.5, the quotations were found guanine, but the invoices were fake documents. Thereby the accused No.5 produced the fake documents for borrowing the loan, where the accused No.6 offered surety.
84
97. As regards to the loan borrowed by the accused Nos.7 and 8, by filing loan application at Ex.P.9 where the accused No.6 offered surety and statement of guarantor is Ex.P.10. The accused Nos.7 and 8 produced two invoices as per Ex.P.99 and 100, obtained from Vanishree Industries. The accused Nos.7 and 8 also furnished the letter of confirmation as per Ex.P.101 and letter of guarantee of accused No.6 is at Ex.P.102. The hypothecation agreement is at Ex.P.103, where the accused No.1 attested as per Ex.P.104. Another loan application of accused Nos.7 and 8 is at Ex.P.11, where statement of guarantor issued by accused No.6 is at Ex.P.12. The accused Nos.7 and 8 are also produced the invoices as per Ex.P.105 to 109 obtained from Krishna Engineering Company and invoices from COTMAC Private Limited. Whereas allegation that invoices obtained from Krishna Engineering Company and COTMAC Private Limited were false documents as like invoice of ESSKAY enterprises.
85
98. To prove the same, the prosecution examined PW.8 - Chandrashekhar who is a businessman of Vani Agro Industries dealing with Tractor and Trailer and the PW.9 Shivaraj Manager of COTMAC Private Limited both have stated that though they have obtained the quotations as Ex.P.100 and the Ex.P.106, but the same was not issued by them. The Ex.P.106 is also not issued by them. But these documents were created in the names of Vani Agro Industries and COTMAC Private Limited for the purpose of borrowing the loan by accused Nos.7 and 8.
99. The PW.9 - Shivaraj the Assistant Manager also deposes that Ex.P.106 is the quotation issued in the name of their company, but it was not issued by them. Though, he has stated that whether he cannot say who has created this document, but the Ex.P.106 is not issued himself or his company, which means this document is created by the accused for the purpose of obtaining the loan. 86
100. PW.10 - Umesh another businessman from Krishna Engineering Company also deposes that Ex.P.105 is a printed quotation and it was not issued by his company. Evidence of PWs.6 to 10 reveals that accused persons created invoices/bills, quotations in the names of ESSKAY enterprises, ESSKAY Pipe, Vani Agro Industries, in order to show that COTMAC Private Limited and Krishna Engineering Company, wants to purchase agricultural equipment they have raised the loan, but documents are all false documents which is proved by prosecution from evidence of PWs.6 to
10. Evidence of PW.16 hand writing expert was given opinion that accused persons were created documents and placed before Bank for borrowing loan. Accused persons also filed Exs.P.13 and 14 which are I.T. returns also bogus and Exs.P.13, 14 and 15 are I.T. returns which are not at all filed before income tax, but they have acknowledged by creating and affixing false signature and seal of Income Tax Authority 87 which is evident from evidence of PWs.2 and 3 the Income Tax Officials.
101. Though, the accused No.9 is said to scribe of the loan application and also offered surety to one of the accused, but he has not signed the guarantor application. However, the accused No.1 granted loan. Of course it is duty of by accused No.1 without proper verification sanctioned the loan. But the legal opinion was given by the PW.5 without proper verification. Therefore, the accused No.1 sanctioned the loan.
102. It is seen from the evidence of the PWs.1 to 4, 6 to 10 and 11 to 16 that the prosecution has successful in proving that the accused Nos.2 to 8 have created the false documents including the I.T. returns and invoice bills in the name of various companies in the name of purchasing the agricultural equipments and obtained the loan. Thereby, the accused Nos.2 to 8 have produced the fake and forged 88 documents as guanine before the Bank for the purpose of obtaining the loan and also they have received the loan and thereby they cheated the UCO Bank. Thereby, the accused Nos.2 to 8 have committed the offences punishable under Sections 468, 471, 477 (a) and 420 of IPC.
103. However, this Court has already held that the accused No.1 have received the application from the accused Nos.2 to 8 and referred to the PW.5 - panel advocate and obtained the opinion and sanctioned the loan. Later the loans were disbursed to accused Nos.2 to 8 and accused No.9, though scribe of the loan applications, but he has not signed. Therefore, the accused Nos.1 and 9 are not found guilty for any of the offences charged against them.
104. On the other hand, the prosecution is successful in proving the charges against accused Nos.2 to 8. Though, the accused persons subsequently repaid the loan and there is no loss cause to the Bank, but the amounts were paid by 89 the accused persons only after registering the FIR and during the pendency of the trial. Therefore, merely the repayment made by the accused Nos.2 to 8 cannot be exonerated from charges of creating the documents or fabricating the documents by producing before the authority as genuine and thereby they already cheated the Bank.
105. Though, the complainant Superintendent of Police is not examined by the prosecution, but the PW.15 who is a Investigating Officer appointed by the S.P. The FIR has been marked by the prosecution which is sue-moto complaint by the CBI. Therefore, the FIR is only for the purpose of setting law into motion in a criminal case. Therefore, the FIR is proved by the prosecution by examining the PW.15 and merely non-examination of the S.P. who registered the complaint will not fatal to the case of the prosecution. As per the judgment of the Hon'ble Supreme Court in the case Anilkumar vs. State of U.P. reported (2003) 3 SCC 569 at Para No.7 the Hon'ble Supreme held that the non- 90 examination of the scribe of FIR is not fatal. Herein in this case S.P. is a scribe of the FIR. Therefore, the non- examination of the S.P. is not fatal to the case of the prosecution.
106. As regards to the contention of the counsel for the appellants - borrowers is that they already settled the amount there is no wrongful loss. Therefore, no offences is committed. In this regard, the learned counsel for the respondents relied upon the judgment of the Supreme Court in the case of CBI vs. Harisingh Ranaka and others reported in (2019) 16 SCC 687, wherein the Hon'ble Supreme Court has held that the loan obtained from the Bank by fraud and offences under Sections 420, 467, 468, 471, 120(B) IPC were registered. Subsequently, entered into one time settlement with Bank was not enough to cause the proceedings or discharge the accused. In view of the serious allegations made with regard to de-frauding and cheating 91 committed with help of forged documents. Here in this case, subsequent to the registration of the FIR, the accused return the loan, but by the time the accused were already obtained loan by filing the fabricated documents and committed the fraud. Thereby cheated the Bank. Subsequent to the settlement or repayment will have no impact on the offence registered against the accused in the criminal case. Of course there may be no loss cause to the Bank, but there was already wrongful gain made by the accused persons by receiving the loan. Therefore, the contention of the learned counsel for the accused persons is not sustainable under the law.
107. In view of the above findings, the appellant - accused No.1 in Crl.A.No.780/2011 is entitled for acquittal.
108. The appellant - accused No.5 in Crl.A.No.812/2011 died during the pendency of the appeal. Hence, the appeal abates.
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109. The appellant No.1 in Crl.A.No.967/2011 who is accused No.7 also died during the pendency of the appeal. Hence, the appeal abates.
110. The appeal filed by the appellant - accused No.2 in Crl.A.No.813/2011, the appeal filed by the appellant - accused No.3 in Crl.A.No.815/2011, the appeal filed by the appellant No.2 - accused No.8 in Crl.A.No.967/2011 are liable to be dismissed.
111. The appeal filed by the appellant - accused No.9 in Crl.A.No.792/2011 is deserved to be allowed. Accordingly, I proceed to pass the following;
ORDER i. The Crl.A.No.780/2011 filed by appellant - accused No.1 and Crl.A.No.792/2011 filed by appellant - accused No.9 are allowed.
93ii. The judgment of conviction and sentence passed against accused Nos.1 and 9 by the Spl. Court is hereby set-aside. They are acquitted for the charges leveled against them and the bail bonds stand cancelled. If any fine amount paid by them is ordered to be refunded to them.
iii. The Crl.A.No.813/2011 filed by appellant - accused No.2, the Crl.A.No.814/2011 filed by the appellant - accused No.6, Crl.A.No.815/2011 filed by appellant - accused No.3 and Crl.A.No.967/2011 filed by appellant No.2 - accused No.8, are hereby dismissed.
iv. The Crl.A.No.812/2011 filed by appellant - accused No.5 and Crl.A.No.967/2011 filed by the appellant No.1
- accused No.7 are died during the pendency of the appeals. Hence, the appeals filed by the accused Nos.5 and 7 are hereby dismissed as abated.
94v. Send the copy of the judgment and records to the concerned Court.
Sd/-
JUDGE KJJ