Bangalore District Court
Cbi/Acb/Blr vs A1-Parashivamurthy Mallunathan on 29 August, 2024
KABC010073652018
IN THE COURT OF THE XXI ADDITIONAL CITY CIVIL
AND SESSIONS JUDGE AND PRINCIPAL SPECIAL
JUDGE FOR CBI CASES, BENGALURU (CCC-4)
DATED THIS THE 29th DAY OF AUGUST, 2024.
PRESENT: SRI. SHRIDHAR GOPALAKRISHNA BHAT
XXI Addl. City Civil and Sessions Judge and
Prl. Special Judge for CBI Cases, Bengaluru.
Spl.C.C.No.159/2018
Complainant : CBI/ACB, BENGALURU
By Senior Public Prosecutor
Smt.K.S.Hema.
Vs
Accused 1: Sri. Parashivamurthy Mallunathan
S/o Sri. Mallunathan
Aged about 51 years
The then Head Cashier,
State Bank of India,
Kollegal New Bus Stand
Kollegal - 571440
Present address:
# 5/227/A, Sri Shaila Nilaya,
Kollegal Town- 571440,
Chamarajnagar District,
Karnataka.
Permanent address:
R/o No.7C/707, Ramaswamy Layout,2
Near manjunath Nagar,
Landmark Sai Nath Temple,
Kollegal, Chamarajnagar District
2 Spl.CC.159/2018
2 : Sri. Sayed Quiam,
S/o Late M.S. Jabbar,
Aged about 72 years,
No.7/189, 3 rd Cross,
Kunnegowda Layout,
Basaveshwara Nagara,
Kollegal - 571440,
Chamrajnagar District
Permanent Address:
Mudigunda village - 571440,
Kollegal Taluk
Chamarajnagar District.
3 : Sri. Michael Katookaran,
S/o Sri. E.A. Rappai,
Aged about 59 years
Senior Special Assistant,
Reserve Bank of India,
Bangalore.
No.21, Church Road,
Shanty Nagar,
Near Nirmala Primary School,
Bengaluru-560027.
Permanent address:
As above, Originally from
Trissur, Kerala.
4 : Sri. Wills Warunny,
S/o Sri. E.P. Waruuny,
Aged about 47 years,
(Private person involved in furniture
manufacturing business)
No.30/1B, Nanjappa Road,
Shanthinagar, Bengaluru - 560 027
(By Sri.P.Chandrashekhar, Advocate for
A.1)
(By Sri.Gnanesh N.I. Advocate for A.2)
(By Sri.Sri.B.N.Jayadeva Advocate
for A.3)
(By Sri.Sri.B.J.Prakash Singh, Advocate
for A.4)
***
3 Spl.CC.159/2018
Date of commission of offence Between 10.11.2016
and 14.11.2016
Date of report of offence 06.12.2016
Date of arrest of A.1 08.12.2016
Date of arrest of A.2 Not arrested.
Date of arrest of A.3 09.12.2016
Date of arrest of A.4 Not arrested.
Date of release of A.1 on bail 08.12.2016
Date of release of A.3 on bail 09.12.2016
Total period of custody of A.1 NIL
to 4
Name of the complainant Source Information
Date of commencement of 11.02.2019
recording evidence
Date of closing of evidence 04.01.2021
Offences complained of 120-B R/w. Secs.409, 477(A)
of the Indian Penal Code
('IPC' in short) and Sec.13(1)
(c) & (d) R/w. Sec.13(2)
of the Prevention of the
Corruption Act, 1988
Opinion of the Judge Accused Nos.1 and 2 found
guilty and accused Nos.3 and
4 found not guilty.
JUDGMENT
The Inspector of Police, Central Bureau of Investigation ('CBI' in short) Anti Corruption Branch ('ACB' in short), Bengaluru, has filed the charge-sheet against the accused persons alleging that, they have committed the offences punishable under Section 120-B, R/w. Secs.409, 477(A) of the Indian Penal Code ('IPC' in short) and Sec.13(1)(c) & (d) R/w. Sec.13(2) of the Prevention of the Corruption Act, 1988 ('PC Act' in short.)
2. The facts of the prosecution in nut shell are as under;
4 Spl.CC.159/2018 The accused No.1 Sri. Parashivamurthy Mallunathan, was working as Head Cashier at State Bank of Mysore ('SBM' for short), Kollegala Main Branch, Kollegala, (Now merged with State Bank of India) during the period from 01.01.2015 to 24.11.2016. During that time, demonetization was initiated by the Government of India vide Government Gazette No.2652 dated 08.11.2016 and Reserve Bank of India Circular DCM(Plg) No.1226/10.27.00/2016-17 dated 08.11.2016. The circulars were issued regarding demonetization of currency notes of denominations of Rs.500/- and Rs.1000/- (hereinafter referred to as specified bank notes/ SBN) by Reserve Bank of India with guidelines and norms to follow.
3. During that time, the accused No.1, being a public servant, in the capacity of a Head Cashier of SBM, Kollegala Main Branch, Kollegala, entrusted with remittance sent by RBI to SBM, Kollegala Main Branch,being the custodian of currency chest. He entered into criminal conspiracy with accused Nos.2 to 4 in the matter of illegal exchange of SBNs and exchanged SBNs of Rs.10 lakhs in favour of accused No.2 and through accused No.3 Rs.6 lakhs in favour of accused No.4 and also in favour of various other persons in between 10.11.2016 to 14.11.2016 and in all, the accused No.1 had exchanged SBNs of Rs.1,55,18,500/- (18,703 notes of Rs.500/- and 6,167 notes of Rs.1000/-) for legal tender character illegally and fraudulently by abusing his official position by violating the 5 Spl.CC.159/2018 norms/circular issued by the Reserve Bank of India with dishonest intention to defeat the purpose of demonetization initiated by the Government of India and thereby breached the trust that was entrusted on him in handling the currency kept in the currency chest which was under his custody. In furtherance of the said conspiracy, the accused No.1 had falsified /altered the account/record of the bank randomly to adjust the excess SBNs received and excess legal tender paid, wrongly entered the denominations in respect of the receipts received in the branch during that period by abusing his official position and by illegal means obtained pecuniary advantage for accused Nos.2 and 4 and others without any public interest and thereby the accused persons have committed the offences punishable under Section 120-B R/w. Secs.409, 477(A) of the IPC and Sec.13(1)(c) & (d) R/w. Sec.13(2) of the PC Act, 1988.
4. On the basis of the source information received, CW.34 Superintendent of Police, Head of the Branch, CBI/ACB, Bengaluru had registered the FIR against the accused No.1 and other unknown bank officials and private individuals for the offences under Sections 120B R/w. Sections 409 and 420 of the IPC and Sec.13(1)(d) R/w. Sec.13(2) of the PC Act, in RC25(A)/2016/CBI/ACB, Bengaluru on 06.12.2016 and thereafter, directed the investigation to be conducted by CW.33, the Inspector of Police, CBI/ACB, Bengaluru, who after conducting the investigation filed the present charge sheet against the accused persons for the aforesaid 6 Spl.CC.159/2018 offences after obtaining necessary sanction under Section 19 of the PC Act against accused No.1. Though the accused No.3 is also a public servant, since his public office is not mis-used, the sanction under Section 19 of the PC Act was not taken.
5. After filing of the charge sheet, cognizance of the offences against the accused persons was taken and summons were ordered to be issued to them. In pursuance of the summons issued, the accused persons have entered their appearance and enlarged on bail. Thereafter, as required under Section 207 of the Cr.P.C., copy of the charge sheet and its enclosures were furnished to the accused persons. After hearing, charges were framed against the accused persons. The accused persons pleaded not guilty and claimed to be tried.
6. Prosecution side evidence:
In order to bring home the guilt of the accused, the prosecution has shown in all 35 witnesses in the charge sheet and out of them 29 witnesses were examined as PW.1 to PW.29 excluding CWs.3, 6, 10, 14, 32 and 34. In addition to the charge sheet witnesses, the prosecution has also examined two additional witnesses as PW.30 and 31 and got marked as many as 90 documents as per Ex.P.1 to P.90 and MO.1 to 8. Ex.P.91 FIR was marked with consent and thereby, the prosecution evidence was concluded. The prosecution evidence in gist is described as under;
7 Spl.CC.159/2018 Prosec Charge Person Evidence regarding Exhibits ution Sheet examined marked.
Witnes witne-
s No. ss No. PW.1 CW.1 Sri. Visit to the SBM Main Ex.P.1 to P.5 -
Adinarayana Branch, on 22nd and 23rd of Copy of the G. who is November, 2016 and Circulars working as inspection of records and Ex.P.6 Manager verifying the CCTV footage Production Vigilance with regard to irregularities Memo. Ex.P.7 attached to which had taken place in the Gazette SBM. said Branch regarding Notification dtd.
conversion of SBNs 22.02.2017,
Ex.P.8 Copy of
Norms for regularizing the instructions
the SBNs. dtd
Manager and Head 23.08.2013.
Cashier of the Bank. and Ex.P.9
Production of circulars, Production
Gazette Notification to IO Memo.
under receipt memos. Ex.P.10
Submission of the Inspection
inspection report to the IO. Report, Ex.P.11
Regularizing of Production
currency violating the Bank Memo
guidelines. Ex.P.6(a), 9(a),
10(a), 11(a)
signature of the
witness on the
concerned
document.
PW.2 CW.2 K. Narayana Visit to the Kollegala Ex.P.12 audit
Naik, SBM Branch on 18.12.2016, report Ex.P.13
who was conducting of audit relating Production
working as to irregularities by the Memo Chief officials relating to exchange Ex.P.12(a), Manager of of old currency notes P13(a) Audit, Mobile signature of the Section, Difference amount witness, SBM. regarding unaccounted SBN Ex.P.12 (b) and notes (c) Particulars Verification of CCTV of the SBNs of footage the relevant Submitting of audit period.
report to Chief Vigilance Officer and to IO and transaction of the Branch between 10.11.2016 to 14.11.2016 relating to SBNs.
PW.3 CW.3 Sri. Abhishek Status and Work Ex.P.14 to Nagar, who allotted to the accused in the P.19 was the Branch during relevant Documents 8 Spl.CC.159/2018 Probationary period. pertaining to Officer in exchange of SBM Main Circulation of circulars notes and the Branch Ex.P.1 to P.5 to the staff signature of Kollegala members the witness and Joint found in the Custodian of Status and work of the check slip the currency accused No.3. found in P.14 chest with to P.19 as per A.1. Transactions Ex.P.14(a) to pertaining to exchange of P.19(a).
notes from old to new currency from 10.11.2016 to 14.11.2016.
PW.4 Sri. Work entrusted to Ex.P.20 to 24 Amardeep him, demonetization Cash reports Kumar, was declared, instruction given by cfd 0903 from the Junior CW.15 and transaction 10.11.2016 to Associate, attended by him from 14.11.2016an working at 10.11.2016 to 14.11.2016. d his SBM transactionID Kollegala as per Main Branch Ex.P.20(a) to in between P.24(a).
29.03.2016 to 18.07.2018 PW.5 CW.11 Sri. Kunal Work entrusted to him, Ex.P.20(b) to Goutham, demonetization declared, P.24(b) who was Jr. instruction given by CW.15 transaction ID Associate, in and transaction attended by attended by SBM him from 10.11.2016 to him found in Kollegala 14.11.2016. Ex.P.20 to 24.
Branch from
November,
2015 to
October,
2018.
PW.6 CW.9 Smt. Search of the lockers Ex.P.25, P.26,
Jayashree of the accused No.4 and his Locker
K.S., wife CW.6 on 12.12.2016 and operation
who was seizure of the currency notes proceedings
working as from the locker of CW.6 by IO, 12.12.2016,
Sr. Manager regarding currency notes her signature and Office in- seized with number, locker as per charge, operation proceedings Ex.P.25(a) Federal 26(a) and Bank, St. MO.1 to MO.6, Marks Road, seized Bengaluru, currency from 2012 to bundles 2017. containing 1000 notes of 9 Spl.CC.159/2018 Rs.100/-
denomination each.
PW.7 CW.8 PW.7 Sri. Conducting of secretEx.P.27 Naveen B.S. operation in the SBMSeizure who was Kollegala Main Branch by IO mahazar of working as along with him and his currency Senior colleague, observation of bundles, Manager CCTV footage, Ex.P.28 -24 (HR/IR) in the photographs Regional Exchange of currencysignature of office of by A.1 found in CCTV footage the witness Syndicate to A.2 found in Bank, Mysore seizure Search in the Farm mahazar and House/ burial place along with backside the accused No.2, seizure of photograph as Rs.10 lakhs in 10 bundles ofper Ex.P.27(a) Rs.100 denominations from and the said place. Ex.P.28(a) to P.28(x) and Drawing of mahazar MO.7 and taking of 24 photographs consisting of in that regard. 10 bundles of Rs.100 currency notes.
PW.8 CW.13 Sri. Nandisha Duty entrusted to him, Ex.P.29 A. who was identification of A.2 and 3, portion of the working as work entrusted to A.1, statement of Temporary observation of the CCTV the witness Attender in footage in the bank by IO and given to IO SBM identification of A.1.
Kollegala Branch since 2003 PW.9 CW.12 Sri. Manaiah Designation of CW.15 Ex.P.30 Kumar, who and A.1 and 3, work entrusted Production was working to A.1, memo.
as Single Ex.P.30(a)
Window Submitting of the signature of
operator in documents to IO under the witness on
SBM Production memo. the Production
Kollegala memo.
Branch from Ex.P.31, P.32
2013 to vouchers and
September, cheques
2018. pertaining to
10.11.2016 to
16.11.2016
Ex.P.33 to
P.37 C/c. Of
10 Spl.CC.159/2018
the Cash
denominations
Report.
PW.10 CW.28 Shri. Akil Nature of the Cash Ex.P.38, 39
Pradhan, who Report cfpd 0903, Central Vault Register
was the Data Center (CDC), TE-1 entry dated
Branch Register of Vault / currency 20.10.2016
Manager of chest, teller visit / payment of and
SBI, cash register/ report. 25.02.2016
Kollegala maintained by
Branch, from Purpose of keeping SBM
30.11.2016 to Vault Register, Cash Balance Kollegala,
22.06.2018. Register, Ex.P.40 and
P.52,
Duty of the Head production
Cashier to make payment memo dated
with regard to the cheques 09.10.2017
accepted, purpose of and signature
mentioning the denomination of the witness
behind the cheque leaf. as
Ex.P.40(a),P.5
2(a) and
Ex.P.41
to P.53 C/cs.
of Vault
Register
Extract etc.,
PW.11 CW/15 Sri. K. Md. Designation and work Ex.P.41(a)
Zakir allotted to accused No.1 Legible copy
Hussain, who Demonetization of Ex.P.41.
was the announced by the Ex.P.55
Branch Government of India, covering letter
Manager of information of the guidelines dated
SBM from informed to the staff, 19.11.2016
10.11.2013 to Exchange of SBNs, with two
29.11.2016. Opening of seperate enclosed
counters to exchange the letters.
SBNs
Receiving of the
complaint against A.1 as to
his involvement in exchanging
of the currency with
irregularities and cautioning
him in that regard.
Visit of AGM Sri.
Balakrishna on 12.11.2016 to
the Branch and advice given
to A.1
Work of A.3, receiving
of remittance from RBI on
25.10.2016 and regarding
entries and signature found in
11 Spl.CC.159/2018
Ex.P.42 and P.43.
Maintaining of
currency chest book register
by A.1
PW.12 CW.17 Dr. Syed Seizure of Rs.10 lakhs Ex.P.27 (b)
Hidayatulla, under panchanama and signature of
S/o. Accused taking of photographs the witness on
No.2. the
panchanama.
Ex.P.28(w)
photograph
PW.13 CW.16 B. Deposit of Rs.9,500/- Ex.P.31(a)
Shivamurthy, in SBNs and credit voucher Credit voucher
Account written by him. and 31(b) his
Holder of writings and
SBM. initials in
31(a).
PW.14 CW.17 Sri. C. Deposit of Rs.46 lakhs Ex.P.31(c)Cre
Shankar, in SBNs and credit voucher dit voucher
Account written by him. and 31(d) his
Holder of writings and
SBM initials in
Kollegala 31(c).
Branch
PW.15 CW.18 Sri. Withdrawal of Rs.10 Ex.P.32(a)
Dhanappa lakhs under cheque cheque,
M.C. P.32(a-i)
signature of
the witness.
PW.16 CW.20 Sri. G.B. Deposit of Ex.P.31(e)
Shivaswamy Rs.1,03,500/- in SBNs and Credit voucher
Account credit voucher written by him and 31(f)his
Holder of writings and
SBM initials in
31(e).
PW.17 CW.22 Sri.Prabhakar Withdrawal of Rs.50 Ex.P.32(b)
P.R. lakhs under cheque cheque,
P.32(b-i)
signature of
the witness.
PW.18 CW.23 Sri. R. Deposit of Rs.30 lakhs Ex.P.31(g)Cre
Ranganath, in SBNs as well as in other dit voucher
Account currency notes. and P.31(h)
Holder of signature of
SBM the witness.
Kollegala.
12 Spl.CC.159/2018
PW.19 CW.21 Sri. Mahesh Deposit of Rs.5 lakhs Ex.P.31(j)
S. Account in Rs.100/- and Rs.50/- Signature of
Holder of currency notes. the witness in
SBM Credit
Kollegala. Voucher
PW.20 CW.24 Sri. S. Deposit of Ex.P.53(a)
Rajashekhar, Rs.1,20,00,000/- in SBNs Deposit
received by A.1 Voucher dated
14.11.2016,
P.53(a-i)
signature of
the witness
PW.21 CW.25 Sri. Withdrawal of Rs.20 Ex.P.56 Vault
Shivanshu lakhs from SBM Kollegala, Register,
Pathak, receiving 200 notes of SBN of P.56(a)
Rs.1000 denomination and relevant entry
keeping of the same in Vault. and Ex.P.57
and P57(a)
document
production
receipt and
signature of
the witness.
PW.22 CW.26 Sri. Subrat Withdrawal of Rs.5 Ex.P.32(b)
Kumar Barik, lakhs to receive cash in legal cheque dated Manager tender 10.11.2016 Indian Bank.
PW.23 CW.27 Sri. Swarup Withdrawal of Rs.10 Ex.P.32(e) R.S Branch lakhs to receive cash in legal cheque dated Manager, tender 10.11.2016 Lakshmi Vilas Bank Ltd., PW.24 CW.29 Smt. Shweta Work of A.3, Ex.P.58 and Yadav, Asst. production of service 58(a) Manager, particulars of A.3, deputation document Issue order of A.3 and circulars and production Department, other fresh note remittance memo with RBI orders to IO. signature of the witness.
Ex.P.59
Service
particulars of
A.3 and
Ex.P.60 to
Letter issued by AGM
P.66 Fresh
providing details of the series
Note
of currency notes mentioning
Remittance
the denomination of currency
orders/
notes issued to SBM
Invoices.
Kollegala Branch on
Ex.P.67
20.10.2016.
Instruction
13 Spl.CC.159/2018
details given
to A.3 Ex.P.68
Deputation
order of A.3
Ex.P.69 letter
regarding
currency
notes issued
to SBM
Kollegala
Branch.
Ex.P.70
Deputation
order to
handover the
document.
PW.25 CW.30 Sri. Digambar Work entrusted to him, Ex.P.20(c) to
Patel, who demonetization declared, P.24(c)
was the Jr. instruction given by CW.15 transaction ID
Associate in and transaction attended by attended by
SBM him from 10.11.2016 to him found in
Kollegala 14.11.2016. Ex.P.20 to 24. Branch from 2015 to 2016.
PW.26 CW.35 Sri. Grant of sanction to Ex.P.71 and Mahabaleshw prosecute accused No.1. 71(a) Sanction ar Sitaram, order and Regional signature of Manager the witness.
Ex.P.72 Forwarding Letter.
PW.27 CW.31 Sri. S.A. Seizure of the CCTV Ex.P.73 and
Senthil footage from SBM Kollegala 73(a) sealed
Kannan, Asst. Branch cover and
Programmer, Seizure of Rs.10 lakhs signature of
CBI/ ACB, from accused No.2 and the witness.
Bengaluru. mahazar and photographs MO.8 Hard
taken during seizure, his Disk with
signature found on the connecting
backside of the photographs. cables
Ex.P.27(c)
Identification of MO.7 signature of
the witness.
PW.28 CW.19 Sri. Withdrawal of Rs.22 Ex.P.74 Debit
Dayanand lakhs, producing certain Voucher, P.75
Singh, Asst. records to IO. and 75(a)
Manager, Document
Indian production
Overseas memo with
Bank, signature of
Kollegala. the witness.
14 Spl.CC.159/2018
Ex.P.32(f) and
P32(f-i)
cheque and
signature
found on the
cheque.
PW.29 CW.33 Sri. Rakesh Entire investigation Ex.P.76, 77
Ranjan, conducted, recording of 76(a) and
statement of the witnesses, 77(a) Search
search of the residential List and
house of A.1, inventory inventory
conducted, observation of document of
CCTV footage, conducting of Residential
search in the graveyard of house of A.1
wife of A.2, recovery of the and
MO.7 under Ex.P.27 signatures of
panchanama, collecting of IO. Ex.P.27(d)
documents from witnesses, signature
house search of A.4 by 27(e)
PW.30. Conducting of the Annexure A of
search of house of A.4 by Ex.P.27,
PW.31 etc., Ex.P.78
currency chest
slip along with
Section 65-B
Certificate,
Ex.P.84 Letter
dated
11.10.2017
with copies of
challans,
Ex.P.85
original
vouchers with
covering letter
of the Post
Master.
Ex.P.86 letter
dtd.
23.01.2017,
Ex.P.87 letter
addressed to
Zonal Office.
Ex.P.88 and
89 Receipt/
Payments
Register for
Teller ID
6173365 with
Section 65-B
certificate.
Ex.P.90
Service
15 Spl.CC.159/2018
particulars of
A.1.
PW.30 Addl. Sri. Conducting of search Ex.P.79
Witness Vivekananda of the residence of A.4 on Authorisation No.2 Swamy, 07.12.2016 on the strength ofissued under Inspector, the authorisation given by Section 165 of CBI/ACB, CW.34 under Section 165 of the Cr.P.C., by Bengaluru. the Cr.P.C., along with CW.34 independent witnesses. Ex.P.80 and 80(a) Search Seizure of currencies List and and bank locker key and signature of preparing search list and the witness. handing over the same to the IO.
PW.31 Addl. Sri. S. Conducting of search Ex.P.81 Witness Subramanian of the residence of A.3 on Authorisation No.1 Inspector 7.12.2016 on the strength of issued under CBI/ACB, the authorisation given by Section 165 of Bengaluru CW.34 under Section 165 of the Cr.P.C., by the Cr.P.C., along with 2 CW.34 witnesses. Ex.P.82 and 82(a) Search Inventory proceedings List and conducted in the house of A.3 signature of the witness Seizure of two Ex.P.83 and documents 83(a) Inventory and signature of the witness.
7. After prosecution side evidence, the statement of the accused persons was recorded as provided under Section 313 of the Cr.P.C. The accused have denied the incriminating circumstances found in the evidence of the prosecution witnesses against them and submitted that false case is foisted against them. The accused persons have not opted to lead any evidence on their behalf. However, during cross-examination of PW.2, the accused No.1 has got marked portion of the statement of the PW.2 16 Spl.CC.159/2018 as per Ex.D.1 to D.3 and portion of statement of PW.11 as per Ex.D.4 in support of his defence.
8. Heard the arguments of Smt. K.S.Hema, the learned Sr. Public Prosecutor for CBI and the learned Counsels Sri.P.Chandrashekhar Advocate, Sri.Gnanesh N.I. Advocate, Sri. B.N.Jayadeva, Advocate and Sri.B.J.Prakash Singh Advocate for accused Nos.1 to 4 respectively.
9. Submission of the learned Senior Public Prosecutor.
9(a) The learned Senior Public Prosecutor Smt. K.S.Hema, vehemently argued that accused No.1 and 3 are the public servants and sanction under Section 19(1)
(c) of the PC Act as per Ex.P.71 was taken to prosecute accused No.1. The contents of Ex.P.71 and the evidence of PW.26, the sanctioning authority prove the valid prosecution sanction against accused No.1. The accused persons have not disputed the capacity of PW.26 to issue sanction order against accused No.1. Though, the learned counsel for the accused No.1 cross-examined PW.26 and also the Investigating Officer (for short 'IO'), nothing was elicited from their mouth so as to negate the validity of the prosecution sanction. PW.26 has specifically denied the suggestion that the draft sanction order was prepared by CBI and he has only signed and returned the same to the CBI authority. The evidence of PW.26 and the contents of sanction order clearly reveal the application of mind by the sanctioning authority on 17 Spl.CC.159/2018 the documents furnished and accordingly issuance of prosecution sanction order against the accused No.1. It is further argued that though accused No.3 is the public servant, since his public office is not mis-used and the offences committed do not fall within the purview of his official duty and is charged only for the offence under Section 409 R/w. Sec.120-B of the IPC and not for the offence under the PC Act, there was no need of taking any sanction to prosecute him.
9(b). The learned Senior Public Prosecutor further meticulously argued that the evidence placed before the court would clearly establish that the accused No.1 was the Head Cashier of SBM, Kollegala Main Branch at the relevant time and there is no dispute in that regard. Similarly, the accused No.3 is the employee of RBI, who was deputed to SBM Kollegala Main Branch to monitor the proper remittance sent by RBI and in that regard, there is no dispute. Accused Nos.2 and 4 are the private persons, who got the legal tender currencies for SBNs in pursuance of their conspiracy.
9(c). The learned Senior Public Prosecutor, further argued that there is no dispute as to entrustment of the cash chest with accused No.1 for transaction in his official capacity as Head Cashier along with PW.3, who was the joint custodian of the currency chest at the relevant point of time. Relying on the oral and documentary evidence placed before this court, the learned Senior Public Prosecutor has explained as to excess SBNs received in between 10.11.2016 to 18 Spl.CC.159/2018 14.11.2016 and depositing the same in the cash chest by accused No.1 unauthorizedly and also falsifying the documents to suit the excess SBNs received. It is also argued that the accused No.2, who was admittedly, the teacher of accused No.1 and well acquainted with him, had exchanged the SBNs of Rs.10 lakhs from the accused No.1 and similarly, accused No.3, who is the close friend of accused No.4 got exchanged Rs.6 lakhs on behalf of accused No.4 from accused No.1 and the said amounts were also recovered from them. The currency note numbers were also confirmed by the RBI which was supplied to the SBM Kollegala Main Branch. The evidence placed before this court clearly establish the conspiracy entered into between accused Nos.1 to 4 in the matter of illegal exchange of SBNs from the hands of accused No.1 and exchange of SBNs in violation of the guidelines /circular issued by the RBI with regard to demonetization. The evidence placed before this court clearly establish the offences committed by the accused persons as put up by the prosecution. Accordingly, prayed for conviction of the accused persons. The learned Senior Public Prosecutor in addition to the oral arguments, also filed written memorandum of argument under Section 314 of the Cr.P.C., 9(d). The learned Senior Public Prosecutor has relied upon the following citations in support of her arguments.
1. (2005) 4 SCC 81 C.S. Krishnamurthy Vs. State of Karnataka- regarding sanction.
19 Spl.CC.159/2018
2. AIR 2004 SUPREME COURT 2317 in N Bhargavan Pillai (Dead) by LRs and .. Vs. State of Kerala - regarding offence punishable under Section 409 of IPC.
3. (2009) 8 SCC 1 Sudhir Shantilal Mehta Vs. Central Bureau of Investigation - regarding effect of the Circular
4. (2023) 3 SCC 1 Vivek Narayan Sharma and Others Vs. Union of India and Others. - regarding legality of the demonetization notification.
10. Defence side argument:
10(i) Argument of the learned counsels for the accused Nos.1 to 4.
10(i)(a) The learned counsel appearing for the accused No.1 Sri.P.Chandrashekhar Advocate, vehemently argued contending that the accused No.1 is implicated in this case in order to protect PW.11, the Branch Manager as well as PW.3, the joint custodian of the currency chest. Further, the circular dated 08.11.2016 issued by the RBI i.e., Ex.P.60 was challenged before the Hon'ble Supreme Court in WP No.906/2016 and all the matters pending before various High Courts were taken before the Supreme Court only.
When the matter was pending before the Hon'ble Supreme Court, Government of India had passed the 'Specified Bank Notes' (cessation of liabilities) Act, 2017 and by virtue of the said Act, the circular issued by the RBI had no force and hence, the case of the prosecution cannot be accepted. The learned counsel has fairly submitted that, accused No.1 is not disputing that he 20 Spl.CC.159/2018 was working as Head Cashier and entrusted with currency chest along with PW.3 Sri. Abhishek Nagar, at the relevant point of time. The learned counsel vehemently argued that PW.26, who is the sanctioning authority has not considered the required materials for issuance of sanction order as per Ex.P.71 and thereby the sanction order produced is not valid and thereby the case of the prosecution is liable to be failed. The learned counsel further vehemently argued that, it is the Branch Manager who is liable for day to day transactions of the Bank and PW.3 who was joint custodian of the currency chest with accused No.1 and they were let free and only accused No.1 is made as accused and hence, the accused No.1 is also required to be set free.
10(i)(b) The learned counsel further argued that the Branch Manager has not communicated the circular to the accused No.1 and there was no written work order. Various officials were handling the tellers for exchanging the SBNs for legal tender. The evidence placed before the court does not show any dishonest intention on the part of accused No.1. There is no evidence to prove the criminal conspiracy as alleged by the prosecution. Though search was conducted in the house of accused No.1, no incriminating material was found with him and no loss was caused to the Bank. Further, PW.11 who was the Branch Manager of SBM was also immediately transferred on 28.11.2016 and the IO has not investigated as to why he was transferred immediately. The investigation conducted by the IO is perfunctory and 21 Spl.CC.159/2018 though the accused No.1 is innocent and has not committed any offence alleged against him, he is falsely implicated to save the then Branch Manager PW.11. The CCTV footage is also manipulated to assist the Branch Manager and PW.3, the joint custodian of the chest. Even, Ex.P.55 documents were created to implicate accused No.1. It is further argued that, absolutely there is no required evidence to convict the accused for the alleged offences. Accordingly, prayed for acquittal of the accused No.1.
10(ii) Argument of the learned counsel for accused No.2.
10(ii)(a) The learned counsel for accused No.2 Sri.Gnanesh N.I, Advocate meticulously argued that though the prosecution has examined number of witnesses except PW.7, PW.8 and IO, none of them have stated anything about accused No.2. PW.7, PW.8 have identified accused No.2 on the basis of the CCTV footage. Except the evidence of the IO, there is no other evidence to establish the case of the prosecution against accused No.2. There is no required evidence to establish the ingredients of the offence of the conspiracy against accused No.2. The learned counsel for accused No.2 has fairly submitted that accused No.2 is not disputing the recovery of MO.7 under Ex.P.27 mahazar and accused No.2 is claiming MO.7 i.e., Rs.10 lakhs seized from him. But, the accused has contended that the said amount was recovered from his house and not from the graveyard.
22 Spl.CC.159/2018 10(ii)(b) It is further argument of the learned counsel for the accused No.2 that accused No.2 was having bank account in SBM Kollegala Main Branch and he had transaction with the said bank. Further, accused No.2 has deposited retirement benefit of an amount of Rs.10 lakhs in the said bank on 15.03.2013 for a period of 3 years and the said FD was matured on 15.03.2016. (In support of this argument, at the time of argument, the learned counsel for the accused has filed memo with the copy of Term Deposit certificate and account statement standing in the name of accused No.2.) The accused No.2 had withdrawn the said FD amount to purchase the property. Since he had said cash in his hand in SBNs, he had exchanged the said SBNs from the bank. He was not aware of the procedure for exchanging the currency. The amount exchanged by the accused No.2 was having legal source. The IO has not collected the documents relating to the account of the accused No.2. It is his further argument that, during the cross-examination, the IO has clearly admitted that accused No.2 had not given any extra money for exchanging the notes to the tune of Rs.10 lakhs and also that there was no loss of any amount to the State Exchequer or Central Exchequer or to RBI.
10(ii)(c) It is further argued that the prosecution has not produced any material to show the meeting of mind or agreement between accused No.1 and accused No.2 in the matter of exchanging the SBNs for legal tender currency and there is no required evidence to 23 Spl.CC.159/2018 prove the criminal conspiracy between accused No.1 and 2 in the matter of exchanging of the SBNs. The accused No.2 has exchanged the money as per law and there was no any illegal act on the part of accused No.2. The prosecution has failed to prove the necessary ingredients to constitute the offence of conspiracy against accused No.2. In support of his argument, the learned counsel has also relied on the following Judgment of the Hon'ble Supreme Court.
1. Crl.A.No.2256/2011 dated 10.08.2023 in the case of Balla @ Farhat Vs. State of Madhya Pradesh,
2. Crl.A.No.1571/2021 dated 07.12.2021 in the case of Parveen @ Sonu Vs. The State of Haryana.
10(iii) Argument of the learned counsel for accused No.3:
10(iii)(a) The learned counsel for accused No.3 Sri.B.N.Jayadeva, Advocate vehemently argued contending that the prosecution has not made out case against accused No.3 for the alleged offence. Only evidence of PW.8 and the IO is made available for connecting accused No.3 to the present case. The conducting of house search of A.3 is also doubtful in the light of evidence of the IO and PW.3. Further, the IO has not recorded the confession statement of accused No.3 and no reason is forthcoming from the evidence of IO as to non-recording of confession statement of accused No.3. There is no required evidence to accept CCTV footage produced before this court. No certificate under 24 Spl.CC.159/2018 Section 65-B of Evidence Act is attached to the CCTV footage. The hard disk is also not seized.
10(iii)(b) It is the further argument of learned counsel for accused No.3 that no evidence whatsoever had been produced by the prosecution to show the acquaintance of accused No.3 and 4 and conspiracy entered into between them and accused No.1. There is no positive evidence to show the agreement or meeting of mind of accused No.3 and 4 so as to exchange the SBNs from accused No.1. No positive act on the part of accused No.3 is established by the prosecution. There is no evidence available on behalf of the prosecution as to when the money in SBNs was handed over to accused No.3 by accused No.4 and when exactly the accused No.3 exchanged the said SBNs for legal tender and handed over the same to the accused No.4. Though the search was conducted in the house of accused No.3, no incriminating material was traced. Absolutely, there is no evidence to prove the conspiracy against accused No.3 as alleged by the prosecution. The investigation officer without conducting the proper investigation, roped the accused No.3 for the present prosecution without any basis. The prosecution has failed to establish necessary ingredients to constitute the offence of conspiracy as against accused No.3. In this regard, he has also relied upon the decision of the Hon'ble Supreme Court reported in 2022 Live Law SC 709 in the case of Ram Sharan Chaturvedi Vs. The State of Madhya Pradesh, contending what are the necessary requirements to constitute the 25 Spl.CC.159/2018 offence under Section 120B of the IPC. Accordingly, prayed for acquittal of the accused No.3.
10(iv) Argument of the learned counsel for accused No.4:
10(iv)(a) The learned counsel for accused No.4 Sri.B.J.Prakash Singh, vehemently argued that though the prosecution has examined the various bank officials and its customers, none of them have deposed against accused No.4. None of the witnesses have stated about visiting of accused No.4 to the bank and exchanging of the currency. The CCTV footage is nothing to do with accused No.4 and even it is not the case of the prosecution that the accused No.4 came to the Bank and got exchanged the SBNs. The learned counsel has fairly submitted that the accused No.4 is not disputing the seizure of Rs.6.00 lakhs from the joint bank locker of himself and his wife and accused No.4 is claiming the said amount. It is further argued that no evidence is placed by the prosecution to establish the conspiracy against accused No.4 as alleged. There is no evidence to show that accused No.4 had colluded either with accused No.1 or accused No.3 in the matter of exchanging the SBNs. Admittedly, at the relevant point of time, accused No.4 was not in India but he was in Singapore for taking treatment. In that regard, the accused No.4 has produced copy of the medical records and also his account statement at the time of recording the statement under Section 313 of the Cr.P.C.,
26 Spl.CC.159/2018 10(iv)(b) It is further vehemently argued by the learned counsel that though the wife of accused No.4 Smt. Lis Mathew is shown as CW.6 in the charge sheet, she is not examined before the court to support the case of the prosecution. Further, no evidence is produced to show that accused No.3 had collected the amount from accused No.4 and got it exchanged and redelivered the said amount to accused No.4. Absolutely there is no evidence to show any conspiracy either between accused No.3 and accused No.4 or between accused No.1, accused No.3 and accused No.4 in the matter of the exchange of the SBNs as alleged by the prosecution. The IO has not conducted the investigation properly and has not followed the procedure to be followed in the matter of seizure of the property. Further, the currency notes stated to be seized from the locker are not tallying with the currency notes delivered by the RBI to the SBM, Kollegala Branch. Further, there is no material before the court to link the accused No.4 with the alleged crime. Only on the basis of the seizing of the amount from the locker, accused No.4 is implicated in this case. The statement of accused No.3 is also not recorded by the IO. Hence, absolutely there is no material before this court to prove the charges framed against accused No.4 and accordingly, prayed for his acquittal.
11. Point for determination: On bestowing careful thought to the argument canvassed, rulings relied and carefully scrutinizing the oral and documentary evidence 27 Spl.CC.159/2018 produced before this Court, the points that would arise for consideration are;
1. Whether the prosecution proves the sanction accorded under Section 19(1)(c) of the Prevention of Corruption Act, 1988 as per Ex.P.71 to prosecute accused No.1 is valid?
2. Whether the prosecution proves beyond all reasonable doubt that accused Nos.1 to 4, as the case may be, have conspired together to do an illegal act of exchange of SBNs of denominations of Rs.500/- and Rs.1000/- in favour of accused Nos.2 and 4 with legal tender character by corrupt and illegal means and by abusing the official position of accused No.1 being the public servant to have the pecuniary advantage in favour of accused Nos.2 and 4 without any public interest by committing an act of criminal breach of trust, falsification of the relevant account of the Bank and criminal misconduct by accused No.1, who was working as Head Cashier at SBM Kollegala Main Branch, during the demonetization period i.e., from 10.11.2016 to 14.11.2016 and thereby accused Nos.1 to 4 have committed the offence punishable under 28 Spl.CC.159/2018 Section 120B R/w.Secs.409, 477A of the IPC and Sec.13(1)(c)&(d) R/w. Sec.13(2) of the PC Act?
3. Whether the prosecution further proves beyond all reasonable doubt that during the aforesaid period, the accused No.1 in furtherance of his conspiracy with accused Nos.2 to 4, as the case may be, being the Head Cashier of SBM Kollegala Main Branch, dishonestly exchanged the SBNs of Rs.10 lakhs in favour of accused Nos.2 and Rs.6 lakhs in favour of accused No.4 with legal tender character, by defeating the very purpose of demonetization initiated by the Government of India and also by violating the circular issued by the RBI and thereby committed the offence punishable under Section 409 R/w. Sec.120B of the IPC ?
4. Whether the prosecution further proves beyond all reasonable doubt that, during the above said period, the accused No.1, in furtherance of his conspiracy with accused Nos.2 to 4, as the case may be, had falsified/altered the bank account by exchanging SBNs of Rs.500/- and Rs.1000/- with legal tender character in 29 Spl.CC.159/2018 favour of accused Nos.2 and 4, as the case may be, so as to adjust /suit by excess SBNs received from them and thereby committed the offence punishable under Section 477-A R/w. Sec.120B of the IPC ?
5. Whether the prosecution further proves beyond all reasonable doubt that, during the aforesaid period, the accused No.1, in furtherance of his criminal conspiracy with accused Nos.2 to 4, as the case may be, had exchanged the the SBNs of Rs.10 lakhs in favour of accused No.2 and Rs.6 lakhs in favour of accused No.4 with legal tender character by corrupt and illegal means and by abusing his official position as Head Cashier at the SBM Kollegala Main Branch and obtained pecuniary advantage in favour of accused No.2 and accused No.4 without any public interest and thereby committed the criminal misconduct under Section 13(1)(c) and (d) which is punishable under Section 13(2) of the PC Act, 1988 R/w. Sec.120B of the IPC?
6. What order ?
30 Spl.CC.159/2018
12. The above points are answered as under;
Point No.1 : In the affirmative.
Point No.2 : In the affirmative as against to accused No.1 and 2 and in Point No.5 : negative as against accused Nos.3 and 4.
Point No.6 : As per the final order for the following;
REASONS
13. Point No.1: Before touching the rival contentions and facts in issue, it is appropriate to cull out the undisputed facts which can be gathered from the material placed before the court.
14. Undisputed Facts:
a) Accused No.1 was the Head Cashier of SBM Kollegala Main Branch, when demonetization Notification issued by the Government and he was entrusted with currency chest with bank payment and he is the public servant. In this regard, the prosecution has produced Ex.P.90, service particulars of accused No.1 and also Ex.P.54, certified copy of the bank transfer scroll, which reveals the order dated 01.01.2015 entrusting the accused No.1 with duty of Head Cashier which is not in dispute. The accused No.1 in his statement under Section 313 of the Cr.P.C., for question No.7 categorically stated that he was working as Head Cashier and was entrusted with bank payment. Accused No.1 at that time was to deal with the officers of the other Branch relating to remittance of currencies and issuance of schedule 31 Spl.CC.159/2018 currencies and SBM was the Main Branch for holding the currencies issued from Reserve Bank of India and then distribute to the other branches as and when institution requested. This fact is clearly admitted by accused No.1 in his 313 statement under question No.33.
b) PW.3 Abhishek Nagar who was the Probationary Officer, working in the SBM Kollegala Branch was the joint custodian of the currency chest along with accused No.1. In this regard, there is evidence of PW.3 as well as PW.11.
c) During the relevant time, PW.11 K. Md. Zakir Hussain was the Branch Manager of Kollegala Main Branch.
d) The accused No.3 Michael Katookaran, was employee of RBI and he was on deputation to attend the remittance sent by RBI to the SBM Kollegala Main Branch. In this regard, accused No.3 in his statement under Section 313 of the Cr.P.C., categorically admitted that during demonetization period in 2016, he was an employee of RBI and was attached to SBM Branch Kollegala and entrusted with nature of work pertaining to monitoring of cash remittance sent by RBI. There is evidence of PW.3, PW.11 and PW.24 also in that regard. Further, the prosecution has produced service particulars of accused No.3 as per Ex.P.59 and copy of the deputation order as per Ex.P.68 and instructions dated 14.10.2016 given to accused No.3 as per Ex.P.67 and the said documents are not in issue.
32 Spl.CC.159/2018
e) The accused No.2 Sri. Syed Quicum, was the regular customer of the SBM Kollegala Branch and he was the teacher of accused No.1 and acquainted with each other. In this regard, in 313 statement, under question No.258, accused No.1 categorically stated that accused No.2 was his school teacher.
f) Regarding issuance of demonetization notification by Government of India vide Gazetter Notification No.2652 dated 08.11.2016 and RBI Circular DCM(Plg) No.1226/10.27.00/2016-17 dated 08.11.2016. The RBI Circular is produced as per Ex.P.60. Further, issuance of various circulars by SBM Head Office, Bengaluru as per Ex.P.1 to P.5 regarding demonetization of SBNs and issuance of currency Managements 'Dos' and 'Do nots' for currency chest branches to avoid the penalties by RBI by SBM Head Office Bengaluru as per Ex.P.8.
g) Merger of SBM with SBI vide Gazette Notification dated 22.02.2017 and the said Gazette Notification is produced as per Ex.P.7.
h) The search of the residential house of the accused No.1, 3 and 4 and recovery of MO.7 currency notes of Rs.10 lakhs from accused No.2 and search of the Bank Locker of accused No.4 and his wife and recovery of MO.1 to 6 currency note bundles of Rs.6 lakhs. In this regard, the prosecution has produced house search list of accused No.1 as per Ex.P.76, inventory list prepared in the house of accused No.1 as per Ex.P.77, the search list 33 Spl.CC.159/2018 of the house of the accused No.3 as per Ex.P.82, the inventory list prepared at the house of the accused No.3 as per Ex.P.83, the house search list of accused No.4 as per Ex.P.80, the locker operation proceedings of the bank locker of wife of accused No.4 as per Ex.P.25 and locker operation proceedings of accused No.4 as per Ex.P.26 and these documents are not in much dispute. The recovery mahazar of Rs.10 lakhs from accused No.2 is produced as per Ex.P.27 and 24 photographs taken at the time of seizure of the said amount as per Ex.P.28. The identification of MO.1 to 6 currency bundles seized from the bank locker of the wife of the accused No.4 and MO.7 from accused No.2. It is also pertinent to note that accused No.2 and 4 are claiming right over the money seized as per MO.7 and MO.1 to 6 respectively.
i) Transaction of the SBM Kollegala Branch regarding transaction of the currencies. In this regard, the prosecution has produced various documents as per Ex.P.14 to P.24, Ex.P.31 to P.39, P.41 to P.50, P.52, P.53, P.74, P.78, P.85, P.88 and all the documents are not in dispute.
j) The specific transaction ID numbers for conducting the transactions given to the staff/ officials of the SBM Kollegala Branch. In this regard, the prosecution has produced Ex.P51, the list of ID provided to the staff. It is clear from the said document that accused No.1 Parashiva Murthy, was given with transaction ID No.6173365 and PW.3, PW.4, PW.5, PW.10 34 Spl.CC.159/2018 and PW.25 were given with teller ID Nos.6259871, 6272428, 6267335, 6210120 and 6267181 respectively.
In view of the above undisputed facts, the evidence placed before this court relating to the said facts requires no much consideration.
15. With the above undisputed facts, now, the point No.1 with regard to validity of the sanction to prosecute the accused No.1 is to be analysed on the basis of the material placed before the court.
15(a) As already stated, accused No.1, being the Head Cashier of the SBM Kollegala Branch was the public servant at the relevant point of time and there is no dispute in that regard. Therefore, it is clear that accused No.1 was the public servant as defined under Section 2(c) of the PC Act. It is pertinent to note that, at the time of reply arguments, the learned Senior Public Prosecutor has brought to the notice of this court that the accused No.1 was dismissed from the service in the year 2016 and cognizance was taken in the year 2019 and hence, as on the date of taking cognizance, the accused was not the public servant. However, as a precautionary measure, the IO has taken sanction from the concerned authority as required under Section 19(1)
(c) of the PC Act. The learned counsel appearing for accused No.1 has fairly submitted that the accused No.1 is dismissed from the service and his dismissal is challenged before the proper forum. But no such document is produced before this court. Therefore, it is 35 Spl.CC.159/2018 clear that as on the date of taking cognizance, the accused No1 was not in service. However, the IO has taken sanction to prosecute the accused No.1 as required under Section 19(1)(c) of the PC Act and thereafter filed the charge sheet for the alleged offences.
15(b) It is needless to say that, it is for the prosecution to show that it has obtained valid sanction as required under Section 19 of the PC Act, so as to prosecute the accused No.1 for the alleged offence. Similarly, it is also incumbent on the prosecution to prove that valid sanction has been granted by the sanctioning authority after having satisfied as to the case of the prosecution as to the commission of the offence. This process can be established by the prosecution by producing the original sanction order, which contains facts constituting the offence and grounds of satisfaction and also by adducing the evidence of the author of the sanction order.
15(c) In the case of State of Maharashtra through CBI Vs. Mahesh G. Jain, reported in (2013) 8 SCC 119, the Hon'ble Supreme Court has held that "an order of sanction should not be construed in a pedantic manner and there should not be a hyper technical approach to test its validity. When there is an order of sanction by the competent authority indicating the application of mind, the same should not be lightly dealt with. The flimsy technicalities cannot be allowed to become tools in the hands of the accused".
36 Spl.CC.159/2018 15(d) In another decision of the Supreme Court, in the case of CBI Vs. Ashok Kumar Agarwal 2014 (4) SCC 295, it is held that, the prosecution has to satisfy the court that at the time of sending the matter for grant of sanction by the competent authority, adequate material for such grant was made available to the said authority. This may be evident from the sanction order, in case, it is not extremely comprehensive as well as facts and circumstances of the case may be spelt out in the sanction order. However, in every individual case, the court has to find out whether there has been an application of mind on the part of the sanctioning authority concerned on the material placed before it.
15(e) In the case of Subramanyaswamy Vs. Dr. Manmohan Singh, reported in (2012) 3 SCC 64, it is held that the grant or refusal of the sanction is not a quasi judicial function, what is required to be seen by the competent authority is whether the facts placed before it by investigation agency prima-facie disclose the commission of the offence by the public servant. If the competent authority satisfied that the material placed before it is sufficient for prosecution of the public servant, then, it is required to grant the sanction. If the satisfaction of the competent authority is otherwise, then, it can refuse the sanction. The competent authority cannot undertake a detailed inquiry to decide whether or not the allegation made against the public servant are true.
37 Spl.CC.159/2018 15(f) Further, in the decision, relied by the learned Senior Public Prosecutor in the case of C.S.Krishna Murthy Vs. State of Karnataka, the Hon'ble Apex Court held that; "therefore, the ratio is sanction order should speak for itself and in case, facts do not so appear, it should be proved by leading evidence that all the particulars were placed before the sanctioning authority for due application of mind. In case, the sanction speaks for itself, then, the satisfaction of the sanctioning authority is apparent by reading the order". It is further observed by the Hon'ble Supreme Court that, "it is no doubt true that the sanction is necessary for every prosecution of the public servant, this safeguard is against the frivolous prosecution against the public servant from harassment. But, the sanction should not be taken as a shield to protect corrupt and dishonest public servant."
15(g) In the light of the above principles, this court has to examine the evidence produced by the prosecution. In this context, in order to prove the factum of valid sanction, the prosecution has relied upon the evidence of PW.26 (CW.35) the sanctioning authority and Ex.P.71, the sanction order dated 02.01.2018 issued by PW.26. PW.26, in the capacity of the Regional Manager, had issued the sanction order as per Ex.P.71, being the sanctioning authority. The capacity of PW.26 to grant sanction is not in dispute. The only contention of the accused is that the sanctioning authority has not considered the required materials for issuance of 38 Spl.CC.159/2018 sanction order as per Ex.P.71 and thereby the sanction order produced is not valid.
15(h) Now, the evidence of PW.26 is analysed, in his evidence, he has specifically stated that accused No.1 was working as Head Cashier in SBM Kollegala Branch and CBI sought sanction order against him during December, 2017 through Vigilance Department. After considering the report submitted by Vigilance Department of the Bank, other relevant records, he found it proper to accord sanction for prosecution of the accused No.1 by CBI authorities. Even, during cross- examination, on behalf of accused No.1, he has specifically stated that he had issued Ex.P.71 sanction order only on the basis of the CBI Reports, collection of records relating to dereliction of duty of accused No.1 collected by Bank Vigilance Department. He further deposed that, on verification of the records, though he was not able to find any pecuniary gain received by accused No.1 by exchanging the denominations, he has committed the criminal breach of trust. His evidence during cross-examination further reveals that before issuing Ex.P.71, he had verified transactions handled by accused No.1 as Head Cashier in the Bank. He has specifically denied the suggestion that the draft sanction order prepared by CBI and he signed it and returned it to the CBI. Therefore, on going through the evidence of PW.26, it is clear that he had considered the CBI report and other documents relating to the dereliction of duty of the accused before issuance of the sanction order.
39 Spl.CC.159/2018 15(i) Along with the evidence of PW.26, the contents of Ex.P.27 are analysed, it is clear that, before issuance of sanction order as per Ex.P.71, PW.26 has considered entire facts of the present case with the documents collected by the IO during the course of investigation. The sanction order itself speaks as to what are the things considered by the sanctioning authority before granting the sanction. The sanction order itself speaks and depicts as to satisfaction of the sanctioning authority as to commission of the alleged offence by the accused. The contents of Ex.P.71 clearly depict that after due consideration of the materials placed before him, and application of mind, PW.26 was satisfied that the case is made out prima-facie against the accused No.1, the then Head Cashier of the SBM Kollegala Main Branch, as to commission of the offence under Section 120B R/w. Sec.409, 477(A) of the IPC and Sec.13(1)(c) & (d) R/w. Sec.13(2) of the PC Act. In the sanction order itself, he has narrated the facts and also stated as to careful examination of the materials i.e., copy of the FIR, statement of witnesses and other records collected relating to the case.
15(j) Therefore, on conjoint reading of the evidence of PW.26 and contents of the sanction order, there remains no doubt that PW.26, being the sanctioning authority had considered the relevant materials and after having satisfied as to prima-facie case made out against the accused No.1 for prosecuting him, he had issued sanction order. The evidence of PW.26 and the contents 40 Spl.CC.159/2018 of Ex.P.71 undoubtedly ex-facie demonstrate as to application of mind by the sanctioning authority on the relevant documents and granting of sanction. Therefore, under these attending circumstance, the contention of the accused that Ex.P.71 sanction order was issued without considering the documents cannot be accepted. The principles held in the case of C.S. Krishna Murthy is aptly applicable to the present case on hand to hold that the sanction granted by the sanctioning authority is valid and is in accordance with law. Thus, considering all these aspects, this court is of the firm opinion that the prosecution has proved the valid sanction to prosecute the accused No.1 with regard to the offences charged against him. Accordingly, Point No.1 is answered in the affirmative.
16. Point Nos.2 to 5 : Since these points are inter- linked and to avoid repetition of facts and evidence and also for brevity, they are taken together for consideration.
16(a) In this case, the prosecution has prosecuted the accused for the offences punishable under Sections 120B R/w. Sections 409 & 477(A) of the IPC and for the offence under Section 13(1)(c)&(d) punishable under Section 13(2) of the PC Act. It is noticed that the major allegation is against accused No.1 to commit the offences alleged and conspiracy to commit the said offences is alleged against the accused Nos.2 to 4. It is needless to say that the burden of proving the guilt of the accused for alleged offence beyond reasonable doubt is on the prosecution. It is the cardinal principle of criminal law 41 Spl.CC.159/2018 that every person is presumed to be innocent until the contrary is proved. Therefore, it is needless to say that the burden of proving the guilt of the accused persons for the alleged offence beyond all reasonable doubt is on the prosecution. In order to prove the guilt of the accused persons, the prosecution has to prove all the necessary ingredients of the offences leveled against the accused beyond all reasonable doubt. Therefore, for better understanding and appreciation of the evidence on record, it is just and proper to refer the ingredients necessary to constitute the offences leveled against the accused persons.
16(b) Section 120A gives definition of criminal conspiracy and Section 120B of the IPC provides punishment for committing the criminal conspiracy. Under Section 120-A, the criminal conspiracy is defined as under;
When two or more persons agree to do or cause to be done,-
(1) An illegal act; or (2) an act which is not illegal, by illegal means, such an agreement is designated a criminal conspiracy.
Provided, no agreement except an agreement to commit an offence shall amount to a criminal conspiracy unless some act besides the agreement is done by one or more parties to such agreement in pursuant thereof.
42 Spl.CC.159/2018 16(c) On going through the above provision, it is clear that the following are the necessary ingredients to constitute the criminal conspiracy.
(i) There should be an agreement between the parties who are alleged to conspire.
(ii) Such agreement should be either for doing an illegal act or for doing an act by illegal means.
16(d) The above provision does not contemplate the agreement shall be in writing. Therefore, the agreement may be express or implied or in part express or implied. The agreement is the gist of the offence. In order to constitute a single general conspiracy, there must be a common design and common intention of all to work in furtherance of common design. It is also clear that the definition of the conspiracy under Section 120-A excludes an agreement to commit the offence from the category of such conspiracy, in which it is necessary that the agreement should be followed by some act. The essence of the offence of criminal conspiracy is the fact of combination by agreement. The conspiracy arises and the offence is committed as soon as the agreement is made and the offence continues to be committed so long as the combination persists. It is clear that in a criminal conspiracy, meeting of mind of two or more persons for doing an illegal act is a sine-qua-non. In this regard, this court is also being guided by the decision of the Hon'ble Supreme Court reported in 2002 SCC (Cri) 1734 in the case of Mohd. Khalid Vs. State of West Bengal.
43 Spl.CC.159/2018 16(e) So far as the criminal breach of trust is concerned, Section 405 of the IPC., defines criminal breach of trust as under;
"Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes off that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied which he has made touching the discharge of such trust or willfully suffers any other person so to do commits "criminal breach of trust".
16(f) On going through the above definition, it is clear that, to constitute the offence of criminal breach of trust, it requires (a) entrusting any person with property or with dominion over the property, (b) the person entrusted dishonestly (i) misappropriates or converts to his own use that property or (ii) dishonestly uses or disposes of that property or willfully suffers any other person so to do in violation of any direction of law prescribing the mode in which such trust is to be discharged or any legal contract made touching the discharge of such trust.
16(g) Similarly, Section 409 of the IPC., constitutes one of such criminal breach of trust committed by public 44 Spl.CC.159/2018 servant or by banker, merchant or agent etc., Section 409 reads as under;
"Whoever, being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent, commits criminal breach of trust in respect of that property, shall be punished with imprisonment for life or with imprisonment of either description for a term which may extend to 10 years and shall also liable to fine".
16(h) On going through the above provision, in order to constitute an offence under Section 409 of the IPC, the following essential ingredients has to be established.
(i) the accused is a public servant;
(ii) he is entrusted with some property or domain over the property in his capacity as public servant ;
(iii) he commits breach of trust in respect of the said property.
16(i) Section 477A of the IPC, deals with falsification of account and punishment prescribed for the said offence, which reads as under:
"whoever being a clerk, officer or servant or employee or acting in the capacity of clerk,
45 Spl.CC.159/2018 officer or servant willfully, and with an intention to defraud, destroys, alters, mutilates or falsifies any book, electronic record, paper, writing, valuable security or account which belongs to or is in the possession of his employer or has been received by him for or on behalf of his employer, or willfully and with an intend to defraud, makes or abates the making of any false entry in, or omits or alters or abates the omission or alteration any material particular from or in any such book, electronic record, paper, writing, valuable security or account shall be punishable with imprisonment of either description for a term which may extend to 7 years or with fine or with both."
Explanation - it shall be sufficient in any charge under the section to allege a general intent to defraud without naming any particular person intended to be defraud or specifying any particular sum of money intended to be the subject of the fraud or any particular day on which the offence was committed.
16(j) As per the above provision in order to prove/establish the offence of falsification of the account the following ingredients have to be proved.
a) the person coming within its purview must be a clerk or an officer or a servant or 46 Spl.CC.159/2018 acting in the capacity of the clerk, an officer or a servant.
b) he must willfully and with an intention to defraud - destroy or alter or mutilate or falsify any book, electronic record, paper, writing, valuable security or account which belongs to or in the possession of his employer or has been received by him for and on behalf of his employer make or abate the making of any false entry in or omit or alter or abate the omission or alteration of any material particular from or in any such book, electronic record, paper, writings valuable security or account.
16(k) In order to bring home an offence under section 477-A of the IPC, the prosecution has to establish that at the relevant time the accused was the officer and acting in that capacity destroy or alter or mutilate or falsify any book, electronic record, paper, writings, valuable security or account which belonged to or in the possession of his employer or has been received by him for and on behalf of his employer and that he did so with intend to defraud.
16(l) So far as the ingredients of the above said offences are concerned, this court is also being guided by the decision of the Hon'ble Supreme Court in the case of N. Raghavender Vs. State of Andhra Pradesh CBI reported in LL 2021 SC 734, wherein, the Hon'ble 47 Spl.CC.159/2018 Supreme Court was pleased to discuss the ingredients to constitute the above said offences.
16(m) So far as Section 13 of the PC Act is concerned, it deals with criminal misconduct by the public servant. As already stated, the accused No.1 alleged to have committed the offence under Section 13(1)
(c) and Section 13(1)(d) of the said Act and the other accused persons are charged under Section 120B of the IPC. In order to bring home the guilt of the accused, under Section 13(1)(c), the prosecution has to prove that the accused being a public servant, dishonestly or fraudulently misappropriates any property entrusted to him or under his control as public servant or allows any other person to do so or converts that property for his own use. Therefore, the prosecution has to prove the entrustment of the property or control over the property by the accused.
16(n) To attract the provisions of Sec.13(1)(d) of the PC Act, the prosecution has to establish that the accused being a public servant obtains for himself or any other person any valuable thing or pecuniary advantage by corrupt or illegal means or by abusing his official position as public servant or while holding the office as public servant, the accused obtains for any other person any valuable thing or pecuniary advantage without any public interest. In this regard, this court is being guided by the decision of the Hon'ble Supreme Court in the case of 48 Spl.CC.159/2018 K.R.Purushottam Vs. State of Kerala, reported in AIR 2006 (12) SCC, 631.
17. With the above aspects, now the evidence on record is to be dissected so as to determine whether the prosecution has proved all the necessary ingredients of the offences alleged against the accused. As already stated, in this case, in order to prove the case of the prosecution against the accused, the prosecution has examined in all 31 witnesses as PW.1 to PW.31 and got marked as many as 91 documents as indicated in para 6 supra in the tabular column.
18. Now the case of the prosecution with regard to Sec. 409 of the IPC is concerned, it is the specific case of the prosecution that, in furtherance of the criminal conspiracy with the accused Nos.2 to 4, during demonetization period from 10.11.2016 to 14.11.2016, the accused No.1 being the Head Cashier of SBM Kollegala Main Branch, entrusted with currency chest and bank payment had exchanged SBNs of Rs.500/- and Rs.1000/- with dishonest intention to defeat the purpose of the denomination initiated by the Government of India by violating the norms/ circulars issued by the RBI and thereby committed the offence punishable under Section 409 of the IPC. In this regard, as already stated, it is admitted fact that the accused No.1 in the instant case is a public servant and he was working as Head Cashier at the then SBM Kollegala Branch. It is appropriate to note that there is no dispute with respect to entrustment of 49 Spl.CC.159/2018 work to him as Head Cashier during the relevant point of time i.e., from 10.11.2016 to 14.11.2016 and this aspect is also unequivocally admitted by the accused No.1 himself in his statement under Section 313 of the Cr.P.C., The another aspect which is required to be considered is, whether he was entrusted with any property or was having any domain over the same. In this regard, it would be appropriate to refer to the evidence which is placed before this court.
19. The entrustment to the accused No.1 is concerned, PW.11 being the Branch Manager of the then SBM Kollegala Main Branch at the relevant point of time, deposed in his evidence that accused No.1 was working as Head Cashier at the relevant point of time in Kollegala Branch and as a Head Cashier he was entrusted with (i) remittance with RBI with joint custodian of currency (ii) send the soiled and mutilated notes back to RBI. (iii) receive the currency from the joint custodian of the currency chest for the business of the day in the morning
(iv) he was to send the currencies to the tellers of the Branch to attend the customers through his cash drawer to the teller's cash drawer. (v) he was to receive and make payment from various branch, inter branch of the bank, Government Department which makes the customers to wait in the que. It is his further evidence that at the end of the day of the business of the bank, accused No.1 was to collect the money handed over by the tellers of the Branch through their cash drawers to his cash drawer after getting justified by tallying / reconciliation of the 50 Spl.CC.159/2018 amount received denomination wise was to be put in vault under the monitoring of joint custodian who was the senior officer to him. Further, the Head Cashier and the joint custodian have to maintain the vault register, currency Chest Book (Form TE-1) Register and both should sign the transaction at the end of the day's transaction.
20. It is further stated by PW.11 that accused No.1 has to generate Consolidated Register, TE-1 Register, Vault Register, Cash in Hand Balance Register, the amount tallied must take the concurrence of the joint custodian and send the same to the local head office for complying and further be sent to RBI in prescribed form which reflects complete flow of cash through vault of the currency chest. The Cash In hand balance book register is maintained by the Head Cashier for making entry of the amount received by him. If the amount is less than Rs.50,000/- of cash transaction of the day and that will be entered in Cash In Hand Balance Book and that should merge with next day transaction. At any point of time, any amount received more than Rs.50,000/- shall have to be carried in Vault / Currency Chest Register. It is also his further evidence that accused No.1 was not directly in contact with bank's regular customers. He can entertain the executives/ representatives of the other banks who approach him for deposit of few money or to receive good amount of money. However, value of the small transaction is not required to be entertained by the Head Cashier of the currency chest. It is also his further 51 Spl.CC.159/2018 evidence that the accused No.1 was promoted in October, 2015 as Head Cashier and he was deputed to handle the currency chest. This evidence of the PW.11, who was the Branch Manager reveals as to what works are entrusted with accused No.1. This evidence of PW.11 is not challenged or controverted in any manner. It is not the case of the accused No.1 that the above said work was not entrusted to him. Though the learned counsel for accused No.1 has cross-examined PW.11, nothing was elicited from his mouth so as to disbelieve his evidence as to work entrusted to accused No.1. No doubt, in the course of cross-examination, PW.11 has denied the portion of the statement given to the IO as per Ex.D.4. But, that will not make any difference as he has specifically stated the said fact in examination-in-chief at part 6 and also found in his statement given to the IO. Thus, the evidence of PW.11 reveals as to entrustment of currency chest of the Branch with joint custodian and bank payment to the accused No.1. In this regard, even in 313 of the statement in question No.145, when it was stated to him that he was deputed to handle the currency chest, he has answered that not handling the currency chest independently but under the supervision of the Manager or the Accountant. From this, it is clear that the accused No.1 was entrusted with handling the currency chest of the Branch with joint custodian as stated by PW.11.
21. Added to the evidence of PW.11, there is evidence of PW.9 Maniah Kumar, who was working as 52 Spl.CC.159/2018 single window operator in SBM Kollegala Branch from 2013 to September, 2018, in his evidence specifically stated that as a Head Cashier, accused No.1 was to attend the work relating to receiving of remittance from RBI with joint custodian of currency chest and sort out the fake notes and mutilated notes to RBI. Receive the currency from the joint custodian of currency chest for business of the day in the morning. He was to receive currency sent by other branches Government offices and other financial institutions and count at their windows in the presence of the customers, at the end of the day, after transaction, collect the money from the tellers of the Branch and after tallying the amount received denomination wise, he was to put the money in the vault under monitoring of the joint custodian of the Branch. He further deposed that the Head Cashier was also to deal with the work related to remittance and withdrawal of the huge cash like Rs.5 lakhs and above. In case, in other counters, if sufficient money is not available to attend the needs of the customers, then the Head Cashier has to refer with and he was to attend the requirements. This evidence of PW.9 is also not subject to any cross- examination by accused No.1. Therefore, the evidence of PW.9 also reveals as to work entrusted to the accused No.1 and entrustment of the currency chest to him along with joint custodian.
22. The joint custodian of the currency chest from 01.11.2016 to 27.11.2016, Sri. Abhishek Nagar, who was examined as PW.3, in his evidence deposed that accused 53 Spl.CC.159/2018 No.1 was working as Head Cashier at SBM Kollegala Branch and at that time, accused No.1 was allotted with the work of cash chest department and in-charge of entire cash transaction. At that time, accused No.1 was to deal with the officers of the other Branch relating to remittance of currency and issuance of schedule currencies. Further, in the event, any customers of the Bank wanted to deposit huge currencies, accused No.1 was to receive the said currencies as Head Cashier. This evidence of PW.3 is also remained un-challenged.
23. Thus, on going through the evidence of PW.11, PW.9 and PW.3 and also the answers given by accused No.1 while recording his statement under Section 313 of the Cr.P.C., there remains no doubt that the accused was entrusted with currency chest of the SBM Kollegala Main Branch along with joint custodian and also bank payment. Therefore, the prosecution has proved the entrustment of handling of currency chest and bank payments to accused No.1 at the relevant point of time.
24. Now, the question that would arise is, whether the accused No.1 has violated the RBI circular in the matter of exchanging the SBNs. As already stated, there is no dispute as to issuance of demonetization notification by RBI as well as by the Government of India on 08.11.2016 recalling the circulation of SBNs of Rs.500/- and Rs.1000/-. In this regard, the prosecution has produced the Circular dated 08.11.2016 issued by RBI as per Ex.P.60 and various circulars issued by SBM 54 Spl.CC.159/2018 Head Office, Bengaluru, as per Ex.P.1 to P.5 in pursuant to Ex.P.60 Circular and the said circulars are not in dispute. Ex.P.1 is the General Circular dated 09.11.2016, issued by SBM, Head Office, Bengaluru to all the Branches which is annexed with copy of the RBI circular No.RBI/2016-17/112 DCM (Plg) No.1226/10.27.00/ 2016-17. As per the said RBI circular, various instructions were given. The RBI circular also provided for provision for exchange facility of the SBNs.
25. As per the said circular, (1) the specified bank notes of aggregate value of Rs.4000/- or below may be exchanged for any denomination of bank notes having legal tender character with requisition slip in the format specified by the RBI and proof of identity. (2) there is no any limit on the quantity or the value of the SBNs to be credited with the account maintained with the bank by a person where the SBNs are tendered, (3) where compliance with extent of KYC norms is not complete in an account, the maximum value of the SBNs as may be deposited shall be Rs.50,000/-. The circular further reveals that the equivalent value of the SBNs tendered may be credited to an account maintained by tenderer at any bank in accordance with standard banking procedure and on production of valid proof of identity. The equivalent value of SBNs tendered may be credited to a third party account provided specific authorization thereof accorded by the third party is presented to the bank following standard banking procedure and on production of valid proof of identity of the person actually 55 Spl.CC.159/2018 tendering. The circular further provides that cash withdrawal from a bank account over the counter shall be restricted to Rs.10,000/- per day, subject to an over all limit of Rs.20,000/- a week from the date of notification until the end of business hours on 24.11.2016.
26. Thus, on going through the said circular, it is clear that Rs.4,000/- or below may be exchanged for any denomination of bank notes with requisition slip in the format specified by the RBI and on proof of identity. Further, there is no any limit to credit the SBNs to the account maintained with the bank by any person, where SBNs were tendered. Further, where KYC norms is not completed in an account, the maximum value of the SBNs may be permitted to deposit shall be Rs.50,000/-
27. Along with Ex.P.1, the General Circular dated 13.11.2016, i.e., Ex.P.4 is analyzed, it provides for few important measures / precautions to be followed while implementing RBI guidelines. As per the said circular, one of the precautions is that, while accepting the bank notes upto Rs.4000/- for an exchange, extra care should be taken to verify the valid proof of identity submitted by the public as well as existing customers and ensure its genuineness. Further, the copies of the proof if any, collected from the public/ customers should be preserved and also ensure the same is not mis-utilized. So far as the other circulars produced as per Ex.P.2, P.3, P.5 are found to be not relevant in the present case.
56 Spl.CC.159/2018
28. Now, the case of the prosecution is looked into, it is contended that the accused No.1 being in- charge of the currency chest had deposited excess amount in cash chest by exchanging SBNs for legal tender character in violation of the RBI circular during the period 10.11.2016 to 14.11.2016 and the same is described in the following tabular column.
Sl. Date Rs.500/- Rs.1000/-
No.
Receipt Deposit Exce Amount in Receipt Deposit Excess Amount in
ss excess excess
1 10.11.16 52,138 57,847 5709 28,54,500 14,450 16,616 2166 21,66,000
2 11.11.16 78,294 82,351 4047 20,28,500 25,211 26,911 1700 17,00,000
3 12.11.16 81,383 84,014 2631 13,15,500 39,202 38,764 562 5,62,000
4 13.11.16 96,949 1,02,977 6028 30,14,000 51,979 52,984 1005 10,05,000
5 14.11.16 1,24,677 1,24,955 278 1,39,000 38,393 39,127 734 7,34,000
Total 93,51,500 Total 6167,000
29. The above table reveals that totally 18,703 SBNs of Rs.500/- denomination i.e., Rs.93,51,500/- and 6,167 SBNs of Rs.1000/- denomination i.e., Rs.61,67,000/- and in all Rs.1,55,18,500/- (Rs.93,51,500/- + Rs.61,67,000) has been deposited in excess in the currency chest during the period from 10.11.2016 to 14.11.2016 in violation of circular issued by the RBI.
30. In this regard, the prosecution has relied upon the evidence of PW.4, PW.5 PW.25, who attended the tellers during the relevant time, the evidence of PW.1 to PW.3 and PW.11 and also on Ex.P.33 to P.37, P.41 to P.44, P.53 and P.85. As already stated, the bank transactions and the documents produced relating to bank transactions are not in dispute. Ex.P.14 to P.19 are 57 Spl.CC.159/2018 the bundles of documents relating to exchange of notes between 10.11.2016 to 14.11.2016 by the customers of the SBM, Kollegala Branch as per the circular issued by the RBI. Ex.P.20 to P.24 are the Cash Report cfpd0903 which reveal cash transactions made by each tellers in SBM Kollegala Branch between 10.11.2016 to 14.11.2016, which are not in dispute. Ex.P.33 to P.37 are the cash denomination report for the period from 10.11.2016 to 14.11.2016 relating to all the tellers of the SBM Kollegala Branch, Ex.P.41 and P.41(a) are the certified copies of the Currency Chest Book Extract from 02.11.2016 to 01.12.2016, Ex.P.42 is the Vault Register, Ex.P.43 is the Cash Balance Book for the period from 02.11.2016 to 16.11.2016 and Ex.P.44 is the ICCOMS Report for the period from 02.11.2016 to 15.11.2016, Ex.P.52 and P.53 are the IBT (Inter Branch Transfer) transaction challans and vouchers from 11.10.2016 to 14.11.2016 conducted through SBM Kollegala Branch and Ex.P.85 are the original vouchers produced by the Department of Post, Kollegala, indicating denominations of money deposited in SBM Kollegala Branch from 11.11.2016 to 15.11.2016. The entries of the transaction made in these documents are not disputed. Ex.P.45 to P.50 are the individual teller transaction of 6 tellers on 11.11.2016, which is also not in dispute.
31. It is pertinent to note that the prosecution has produced the list of ID provided to each staff of SBM Kollegala Branch as per Ex.P.51 and the said document is not in dispute. The said document reveals that the 58 Spl.CC.159/2018 accused No.1 Parashiva Murthy was given with ID No.6173365 and it also discloses the IDs given to the other staff members including PW.3 to PW.5, PW.10 and PW.25 for conducting bank transactions.
32. Now, the evidence of PW.4 Sri.Amardeep Kumar, Jr. Associate, who was given with ID No.6272428 deposed regarding work allotted to him and transaction attended by him as found in Ex.P.20 to P.24 i.e., Cash - Report cfpd0903 from 10.11.2016 to 14.11.2016 as per P.20(a) to P.24(a). Similarly, PW.5 Sri. Kunal Goutam, Jr. Associate who was given with ID No.6267335 deposed regarding work allotted to him and transaction attended by him from 10.11.2016 to 14.11.2016 as found in Ex.P.20 to P.24 as per Ex.P.20(b) to P.24(b). In the similar line, PW.25 Sri. Digambar Patel, Jr. Associate, who was given with ID No.6267181 deposed regarding work allotted to him and transaction attended by him from 10.11.2016 to 14.11.2016 as found in Ex.P.20 to P.24 as per Ex.P.20(c) to P.24(c). The evidence of PW.4, 5 and 25 remained unchallenged with regard to the work and ID number allotted to them and also the transactions attended by them.
33. The PW.3, who was the Joint custodian of the currency chest along with accused No.1, who in his evidence deposed regarding work allotted to him and also work allotted to accused No.1 and through him, the prosecution has got marked the attested copy of the documents pertaining to the entire transaction as to 59 Spl.CC.159/2018 exchange of SBNs with new currency covering from 10.11.2016 to 14.11.2016 as per Ex.P.14 to P.19 and the check slip bearing his signature as per Ex.P.14(a) to P.19(a) respectively and these documents are not disputed by the accused persons.
34. On conjoint reading of the evidence of PW.4, 5, 11 and 25 and the Ex.P.20 to P.24, P.33 to P.37, P.41 to P.50, it is clear as to how much excess SBNs were deposited in the Cash Chest from 10.11.2016 to 14.11.2016 and the same is described as under;
On 10.11.2016
Particulars SBNs of SBNs of
Rs.1000 Rs.500
1. Opening branch cash balance as per - 47
Cash Balance Register Ex.P.43
2. Cash withdrawn from Currency Chest as 12 92
found in Ex.P.44, chest slip (ICCOMS Report)
3. Received SBNs through accounts and 14358 52029 across the counters as per Ex.P.33 4. Closing Balance as per Cash Balance 20 47 Register (Ex.P.43)
5. Total SBNs to be deposited in Cash 14430 52091 Chest (1 + 2 + 3 - 4)
6. Actual cash deposited as per Currency 16596 57800 Chest Book and Vault Register as per Ex.P.41 and P.42
7. Excess SBNs deposited 2166 = 5709 = Rs.21,66,000 Rs.28,54,500 Hence, the total value of the excess SBNs received on 10.11.2016 was Rs.50,20,500/-
60 Spl.CC.159/2018
On 11.11.2016
Particulars SBNs of SBNs of
Rs.1000 Rs.500
1. Opening branch cash balance as per 20 47
Cash Balance Register Ex.P.43
2. Cash withdrawn from Currency Chest 96 00
as found in Ex.P.44, chest slip (ICCOMS Report)
3. Received SBNs through accounts and 25095 78247 across the counters as per Ex.P.34 4. Closing Balance as per the Cash 00 09 Balance Register (Ex.P.43)
5. Total SBNs to be deposited in Cash 25211 78285 Chest (1 + 2 + 3 - 4)
6. Actual cash deposited as per Currency 82342 26911 Chest Register and Vault Register as per Ex.P.41 and P.42
7. Excess SBNs deposited 1700 = 4057= Rs.17,00,000 Rs.20,28,500 Hence, the total value of the excess SBNs received on 11.11.2016 was Rs.37,28,500/-
On 12.11.2016
Particulars SBNs of SBNs of
Rs.1000 Rs.500
1. Opening branch cash balance as per 00 09
Cash Balance Register Ex.P.43
2. Cash withdrawn from Currency Chest 11 42
as found in Ex.P.44, chest slip (ICCOMS Report)
3. Received SBNs through accounts and 39,191 81,332 across the counters as per Ex.P.35 4. Closing Balance as per the Cash 34 14 Balance Register (Ex.P.43)
5. Total SBNs to be deposited in Cash 39168 81369 Chest (1 + 2 + 3 - 4)
6. Actual cash deposited as per Currency 39730 84000 Chest Register and Vault Register as per Ex.P.41 and P.42
7. Excess SBNs deposited 562 = 2631 = Rs.56,200 Rs.13,15,500 61 Spl.CC.159/2018 Hence, the total value of the excess SBNs received on 12.11.2016 was Rs.18,77,500/-
On 13.11.2016
Particulars SBNs of SBNs of
Rs.1000 Rs.500
1. Opening branch cash balance as per 34 14
Cash Balance Register Ex.P.43
2. Cash withdrawn from Currency Chest 30 00
as found in Ex.P.44, chest slip (ICCOMS Report)
3. Received SBNs through accounts and 51934 96893 across the counters as per Ex.P.36 4. Closing Balance as per the Cash 2 37 Balance Register (Ex.P.43)
5. Total SBNs to be deposited in Cash 51,996 96,870 Chest (1 + 2 + 3 - 4)
6. Actual cash deposited as per Currency 52,982 1,02,940 Chest Register and Vault Register as per Ex.P.41 and P.42
7. Excess SBNs deposited 986= 6070= Rs.9,86,000 Rs.30,35,000 Hence, the total value of the excess SBNs received on 13.11.2016 was Rs.40,21,000/-
On 14.11.2016
Particulars SBNs of SBNs of
Rs.1000 Rs.500
1. Opening branch cash balance as per 02 37
Cash Balance Register Ex.P.43
2. Cash withdrawn from Currency Chest 00 00
as found in Ex.P.44, chest slip (ICCOMS Report)
3. Received SBNs through accounts and 38391 124640 across the counters as per Ex.P.37 4. Closing Balance as per the Cash 03 55 Balance Register (Ex.P.43)
5. Total SBNs to be deposited in Cash 38390 124622 Chest (1 + 2 + 3 - 4) 62 Spl.CC.159/2018
6. Actual cash deposited as per Currency 39124 124900 Chest Register and Vault Register as per Ex.P.41 and P.42
7. Excess SBNs deposited 734= = 278 Rs.7,34,000 Rs.1,39,000 Hence, the total value of the excess SBNs received on 14.11.2016 was Rs.8,73,000/-
35. Thus, on considering the above aspects, it is clear that in all, 6148 SBNs of Rs.1000/-, 18745 SBNs of Rs.500/- are received in excess in Currency Chest unauthorizedly in between 10.11.2016 to 14.11.2016, which is more clearly described as under.
Sl. Date Rs.1000 Rs.500 Total Value (Rs.)
No. SBN SBN
1 10.11.2016 2166 5709 Rs.50,20,500/-
2 11.11.2016 1700 4057 Rs.37,28,500/-
3 12.11.2016 562 2631 Rs.18,77,500/-
4 13.11.2016 986 6070 Rs.40,21,000/-
5 14.11.2016 734 278 Rs.8,73,000/-
Total 6148 18745 Rs.1,55,20,500/-
36. Thus, from the above aspects, it is clear that such an excess SBNs were received and placed in the Currency Chest unauthorizedly without following the circular issued by the RBI. This clearly reveals the insertion of huge SBNs in the Currency Chest of SBM, Kollegala Branch during the above said period by violating the circular issued by the RBI and even banking procedures.
63 Spl.CC.159/2018
37. In this regard, the evidence of PW.2 Sri. K. Narayana Naik, Chief Manager of Audit Mobile Section, SBM is analysed, he deposed in his evidence that, on the instructions of Superior officers of the bank, on 18.12.2016, he gave visit to SBM Kollegala Branch and conducted the audit relating to the irregularities alleged to have been committed by the officials relating to exchange of old currency notes into regular currency after demonetization notification for a period covering from 09.11.2016 to 24.11.2016. He further stated that he verified Currency Chest Register, Cash Balance Register, Cash Scroll Records and related vouchers and found unaccounted SBNs of Rs.3,49,37,000/- were exchanged without maintaining proper records. His report is marked as Ex.P.12. As per his report, the SBNs of Rs.500/- denomination received without proper documentation during 10.11.2016 to 14.11.2016 was as per Ex.P.12(b) and that of Rs.1000/- during that period was as per Ex.P.12(c). Therefore, the evidence of PW.2 and Ex.P.12 report also reveal as to receipt of SBNs in SBM Kollegala Main Branch without following the circular issued by the RBI.
38. In addition to the above, the evidence of PW.1 Sri. Adinarayana G, the Manager Vigilance, attached to SBM is looked into, in his evidence, he deposed that in the month of November, 2016, he was informed by Chief Vigilance Officer that some irregularities have taken place pertaining to SBM Kollegala Branch, relating to conversion of old demonetized currencies into regular 64 Spl.CC.159/2018 currencies. Accordingly, on 22 nd and 23rd of November, 2016, he gave visit to Kollegala SBM Branch and conducted inspection of records pertaining to the said allegations by verifying the CCTV footage and also related records. At that time, accused No.1 was working as Head Cashier of the said Branch. It is further deposed by him that, on verification of the CCTV footage, he was able to observe that some two or three persons from the public went to Head Cashier chamber, encashed demonetized currencies into regular currencies. After completing his allotted work, he submitted detailed report of inspection to the Chief Vigilance Officer and AGM, Vigilance. The prosecution got marked the said report as per Ex.P.10.
39. It is the further evidence of PW.1 that as per his report, an amount of Rs.40,27,500/- old currency notes have been regularized by violating bank guidelines and also identified accused No.1 before the court who was working as Head Cashier in the SBM Kollegala Branch at the relevant point of time. Even, in his evidence he has specifically stated that on his visit to SBM Kollegala Branch on 22/ 23.11.2016, he was able to observe that, accused No.1 working as Head Cashier has violated the circulars issued. PW.1 in his evidence specifically pointed out as to violation of circulars by accused No.1 in the matter of exchanging the SBNs. The said evidence of the PW.1 was remained unchallenged. Even, the contents of Ex.P.10 are analysed, it clearly denote the complaint made against the accused No.1, the Head Cashier of the SBM Kollegala Branch with regard to 65 Spl.CC.159/2018 currency exchange made by him. Further, in his report, PW.1 has specifically stated as to violation of RBI guidelines in the matter of exchange of SBNs in SBM Kollegala Branch, violation of laid down bank norms. It is also stated that the CCTV footage clearly shows that customers / public receiving the amount of more than Rs.10,000/- from the Head Cashier by referring to five instances in his report. Therefore, the evidence of PW.1 and the report submitted by him as per Ex.P.10 also reveal as to exchange of SBNs by violating the RBI circular and also the bank norms. The evidence and the report of PW.1 specifically pointing the accused No.1 in that regard.
40. It is pertinent to note that admittedly, accused No.1 was in-charge of Currency Chest with PW.3 as joint custodian and PW.3 was the Senior Officer to accused No.1. Since they were in-charge of Currency Chest of SBM Kollegala Branch, the opportunity to place the SBNs in the currency chest was available only to them. In this regard, the evidence of the Branch Manager, the PW.11 is analysed, as already discussed in para 19 and 20 supra, PW.11 has specifically stated as to work entrusted to accused No.1 and entrustment of currency chest to him along with joint custodian PW.3. PW.11 in his evidence specifically stated that after the end of the day of the business of the bank, accused No.1 was to collect the money handed over by the telllers of the Branch and after getting justified by tallying/ reconciling the amount received denomination wise, was to be put in the Vault 66 Spl.CC.159/2018 under the supervision of the joint custodian. Further, the Head Cashier and the Joint Custodian have to maintain the Vault Register, Currency Chest Book Register and both should sign the transaction at the end of the day.
41. The PW.11 in his evidence further deposed that, accused No.1 has to generate the consolidated register TE-1, Vault Register, Cash In Hand Balance Register and he has to take the concurrence of the joint custodian if the amount is tallied and send the same to the local head office for complying and further be sent to RBI in the prescribed form, which reflects the complete flow of cash through vault of Currency Chest. PW.11 during his evidence further stated that he started receiving some complaint against accused No.1 relating to his involvement in exchange of currencies with irregularities and suspected that he was facilitating unauthorized exchange of old bank notes and cautioned him. Inspite of that, a que of the public before the teller started increasing and later news in TV appeared stating that old bank notes have been exchanged in our bank illegally and without following guidelines. In that regard, he advised accused No.1 and wrote a letter to the higher authorities. Inspite of all these developments, accused No.1 continued his indulgence in exchanging old bank notes with irregularities. When he cautioned him, he denied the charges on the ground that it is a false rumour. It is his further evidence that on 12.11.2016, AGM visited the branch and advised accused No.1 to stop 67 Spl.CC.159/2018 entertaining any exchange of old notes without following the bank guidelines, but accused No.1 continued the same. The accused No.1 being in the custody of records like Vault Register, Cash in hand Register, Indents etc., maintained by him under the supervision of the joint custodian of the currency chest and the report has to be prepared by the accused No.1 with regard to available cash as per inflow and outflow of the Vault tallied with concurrence of the joint custodian.
42. Thus, on going through the evidence of PW.1 and PW.11 along with Ex.P.10, it is clear that there is clear allegation against accused No.1 as to unauthorized exchange of SBNs for legal tender character. Even at the time of evidence, PW.11 has produced two letters with covering letter as per Ex.P.55, which was marked subject to objection. The said letters also disclose the allegations made against accused No.1 for having exchanged the SBNs authorizedly in violation of the circulars. There is no any allegations against joint custodian of the Currency Chest as to unauthorized exchange of the SBNs. Under these attending circumstances, it is the accused No.1 who has to give explanation as to excess SBNs deposited in the Cash Chest as discussed supra. However, absolutely there is no explanation forthcoming from the accused No.1 in that regard.
43. With regard to the deposit of excess SBNs in the Currency Chest, it is not the case of the accused No.1 that it was the joint custodian who was exchanging the 68 Spl.CC.159/2018 SBNs and depositing the same in the Currency Chest and there is no allegation against the joint custodian of the Currency chest in that regard. Even the joint custodian of the Currency Chest is examined before the Court as PW.3 and though the learned counsel for accused No.1 has cross-examined the said witness, nothing was brought out from his mouth to show that PW.3 is also responsible for depositing the excess SBNs in the Currency Chest. Even, no suggestion was put to his mouth in that regard. Therefore, it is not the case of the accused No.1 that the joint custodian of the Currency Chest is also liable for depositing the excess SBNs. Under these attending circumstances, it is the accused No.1 being the custodian of the Currency Chest has to give explanation as to deposit of excess SBNs in the Currency Chest.
44. Apart from that, it is also interesting to note that accused No.1 himself admitted the exchange of SBNs for legal tender character in favour of accused No.2 at the time of cross-examination of the IO. It was suggested to the IO during his cross-examination on behalf of accused No.1 that accused No.2 first met the Branch Manager and on the instruction of the Branch Manager, the accused No.1 exchanged the currencies. It is also suggested to his mouth on behalf of the accused No.1 that as accused No.2 was the regular customer of the SBM Kollegala branch and the accused No.1 had exchanged the currency notes at the instance of the Branch Manager. The said suggestions were denied by 69 Spl.CC.159/2018 the witness, but the suggestions reveal that admittedly, the accused No.1 himself exchanged the SBNs for legal tender character in favour of accused No.2. No doubt, it was suggested that, it was at the instance and instruction of the Branch Manager. But, the said suggestion was denied. In this regard, it is pertinent to note that, when the Branch Manager was examined before the court, such contention was not taken by accused No.1 and even it was not suggested to him during his cross-examination that at his instruction and instance, accused No.1 had exchanged SBNs of accused No.2 for legal tender character. Therefore, one thing is certain that accused No.1 himself exchanged the SBNs of accused No.2 for legal tender character to an extent of Rs.10 lakhs. No material is placed before the court to show that the said exchange of SBNs was in accordance with the circular issued by the RBI. Therefore, considering all these aspects, there remains no doubt that it was accused No.1, being the custodian of the Currency Chest was responsible for depositing the excess SBNs in the Currency Chest by exchanging the same for legal tender character by violating the RBI guidelines and even the banking norms. It prima-facie and undoubtedly clear that this was the modus-operandi of the accused No.1 in the matter of receiving the SBNs for legal tender character.
45. When the above said aspects are carefully appreciated, they indicate the modus-operandi of the accused No.1 wherein, he had exchanged the SBNs with 70 Spl.CC.159/2018 legal tender notes during demonetization period in violation of RBI circular. Hence, on analysis of entire evidence placed before this court, there remains no doubt about entrustment of the work and Currency Chest with accused No.1 and also the exchange of SBNs by him by violating the RBI circulars. At this juncture, it is pertinent to note hat whenever the provisions of Section 409 of IPC is pressed into service, the law mandates that the burden of proof in respect of proving the said offence will always be on the prosecution and at the same time, when the prosecution establishes the fact that the accused was a public servant who was entrusted with a property and was duty bound to account for and there was dereliction of duty, the onus of explanation will be shifted on the accused. In this regard, it is worth to refer the ruling relied by the learned Sr. Public Prosecutor reported in AIR 2004 Supreme Court 2317 (N. Bhargavan Pillai (dead) by LRs and another Vs. State of Kerala, wherein, Hon'ble Supreme Court held that "it is fairly well settled position in law that actual mode of entrustment or misappriation is not to be proved by the prosecution. Once entrustment is proved, it is for the accused to prove as to how property entrusted was dealt with".
46. In another decision of the Hon'ble Supreme Court, reported in (2007) 1 SCC 623 in the case of Mustafikhan Vs. State of Maharashtra, held as :
10. Where the entrustment is admitted by the accused, it is for him to discharge the burden that the entrustment has been 71 Spl.CC.159/2018 carried out as accepted and the obligation has been discharged.
11. The above position was reiterated in Jagat Narayan Jha v. State of Bihar [1995 Supp (4) SCC 518: 1995 SCC(Cri) 246]
12. It is not necessary or possible in every case to prove as to in what precise manner the accused had dealt with or appropriated the goods. In a case of criminal breach of trust, the failure to account for the money, proved to have been received by the accused or giving a false account of its use is generally considered to be a strong circumstance against the accused. Although onus lies on the prosecution to prove the charge against the accused, yet where the entrustment is proved or admitted it would be difficult for the prosecution to prove the actual mode and manner of misappropriation and in such a case the prosecution would have to rely largely on the truth or falsity of the explanation given by the accused. In the instant case, there is no dispute about the entrustment".
47. Keeping the above principle in mind, it is pertinent to note that in connection with the offence of criminal breach of trust, two distinct factors are required to be proved. The first factor consists of creation of an obligation in relation to the property or the domain over which he is entrusted with and the second aspect which is required to be proved is that the person who is entrusted with the domain over the property has acted dishonestly and contrary to the terms of the obligation 72 Spl.CC.159/2018 created. The said two aspects are required to be appreciated in the instant case also. As already discussed supra in detail, the material placed before this court clearly establish the entrustment of currency chest and bank payment to the accused No.1, obligation on him in connection with the said entrustment and also violation of the circular issued by RBI while discharging his duty as custodian of the currency chest of the bank.
48. So far as the second aspect is concerned, the prosecution has to prove the dishonest intention on the part of the accused No.1 in the matter of committing violation of the obligation on him with regard to the property entrusted. The prosecution has to prove that the accused No.1 has willfully done an act in violation of the circular issued by the RBI. The word "dishonest intention" is to be considered by referring to Sec.24 of the IPC, wherein, the term "dishonestly" has been defined which means doing anything with the intention of causing wrongful gain to one person or wrongful loss to another person. Hence, this court has to consider whether the act of the accused No.1. in not following the guidelines of the circular issued by the RBI with regard to exchange of SBNs could be considered as with a dishonest intention. In this regard, it is pertinent to note that if the evidence placed before this court are analysed, particularly with reference to the evidence of PW.11, PW.13 to PW.23, PW.28 along with Ex.P.31(a), P.31(c), P.31(e), P.31(j), P.31(g), P.32 P.32(a), P.32(c) P.32(e), P.32(f), P.33, P.35, P.37, P.53(a) reveal that even the 73 Spl.CC.159/2018 accused No.1 had gone to an extent of changing the denominations of the currency received so as to adjust the excess SBNs received. This conduct of the accused No.1 makes it very clear that having knowledge of the restrictions with regard to exchange of SBNs as per the RBI circular, in order to suit the violation of the circular, he had made such wrong entries in the documents also. This shows the dishonest intention on the part of accused No.1 in the matter of exchanging the SBNs for legal tender character.
49. Now, one more aspect to be considered is, whether the violation of the RBI circular amounts to violation of the direction of law describing the mode in which the trust is to be discharged. In this regard, the learned Senior Public Prosecutor has relied upon the decision of the Hon'ble Supreme Court in the case of Sudhir Shantilal Mehta Vs. CBI, reported in (2009) 8 SCC 1, wherein, the Hon'ble Apex Court considered the effect of the circular issued by the RBI. In the said case, the Hon'ble Apex Court held that "The Bank entrusted its funds to its officers; they had the dominion over the said property; they were holding the said money in trust which is a comprehensive expression, inter alia, to denote, a relationship of master and servant. The act of criminal breach of trust per se may involve a civil wrong but a breach of trust with an ingredient of mens rea would give rise to a criminal prosecution as well. Criminal breach of trust would, inter alia, man using or disposing of the property by a person who is entrusted with, or has 74 Spl.CC.159/2018 otherwise dominion there over. Such an act must not only be done dishonestly, but also in violation of any direction of law or any contract express or implied, relating to carrying out the trust. It is one thing to say that any circular letter issued by RBI being not within the public domain would not be law but it would be another thing to say that it did not contain any direction of law so as to attract liability in terms of Section 405 of the Penal Code. Lawful directions were issued by RBI. The circular letter was meant for all scheduled banks. The authorities and / or officers running the affairs of scheduled banks were aware thereof. If it is binding on the banks, it would be binding n the officers. Any omission or commission on the part of any authority of the Bank would amount to acting in violation of any direction of law. A direction of law need not be a law made by Parliament or a legislature; it may be made by an authority having the power therefor; the law could be a subordinate legislation, a notification or even a custom".
50. In the said decision, the Hon'ble Apex Court in para 100 specifically observed that, "Even if the words "directions or law" are to be givenliteral meaning, it would include a direction issued by the authorities in exercise of their statutory power as also the power of supervision. We have opined heretobefore that it has been accepted at the Bar that both the RBI circulars as also the Manual or UCO Bank were binding on the authorities." On reading of the said decision of the Hon'ble Apex Court, there remains no doubt that the circular issued by the RBI falls within the 75 Spl.CC.159/2018 purview of direction of law and any violation amounts to violation of direction of law.
51. With regard to the above aspects, this court is being guided by another relied decision by the learned Senior Public Prosecutor, reported in (2023) 3 SCC 1 i.e., popularly known as demonetization case, wherein the Hon'ble Supreme Court upheld the impugned demonetization notification dated 08.11.2016. Therefore, the demonetization circular issued by the RBI is binding on all the banks and its officials and any violation of the said circular amounts to violation of directions of law.
52. Thus, on meticulous analysis of entire material placed before this court, there remains no doubt that the prosecution has proved beyond all reasonable doubt that the accused No.1, being a public servant having entrusted with the Currency Chest of the SBM Kollegala Main Branch with bank payment, violated the RBI circular in the matter of exchanging of the SBNs and thereby committed criminal breach of trust punishable under Section 409 of the IPC. The oral and documentary evidence placed by the prosecution clinchingly establish the necessary ingredients to constitute the offence of criminal breach of trust punishable under Section 409 of the IPC as against accused No.1.
53. In this case, the prosecution has also alleged the commission of the offence punishable under Section 477-A of the IPC against accused No.1 in conspiracy with 76 Spl.CC.159/2018 accused Nos.2 to 4. As already discussed, the prosecution has to prove necessary ingredients to constitute the offence against the accused No.1 as alleged. In this regard, the prosecution has relied upon the evidence of PW.11, PW.13 to PW.23, PW.28 along with Ex.P.31(a), P.31(c), P.31(e), P.31(j), P.31(g), P.32 P.32(a), P.32(c) P.32(e), P.32(f), P.33, P.35, P.37, P.53(a) to substantiate the charge leveled against the accused under Section 477-A of the IPC. The case of the prosecution in this regard is that, the accused No.1 had exchanged the SBNs with legal tender currency notes and manipulated / altered the accounts/ records of the bank to suit the excess SBNs received and thereby committed the offence under Section 477-A of the IPC.
54. With regard to the above aspect, evidence of PW.13 Sri. B.Shivamurthy, is analysed, he being the S.B. Account holder of the SBM Kollegala Branch, bearing S.B.A/c. No. 64060548438, deposed that on 14.11.2016, he had deposited total amount of Rs.9,500/- containing denominations of Rs.1000 x 5 and Rs.500 x 9. Through him, the prosecution has got marked credit voucher as per Ex.P.31(a), one of the vouchers found in Ex.P31 and his writings and initials as per Ex.P.31(b). He has further deposed that he has not collected any corresponding withdrawal amount in Rs.100/- denomination apart from depositing Rs.9,500/- in the said Branch. In this regard, the contents of Ex.P.31(a) are analysed, as per Ex.P.31(b), SBNs of Rs.1000/- denomination and 90 SBNs of Rs.500/- denomination were deposited in the said bank.
77 Spl.CC.159/2018 But, the contents of Ex.P.37 Cash Denomination Report in that regard is verified, it is noticed that the accused No.1 has himself received the said amount under his teller ID and entered the received notes as Rs.100/- x 95 instead of Rs.1000/- x 5 + Rs.500/- x 9.
55. PW.14 C. Shankar, who is one of the Trustees of Vinayaka Temple Kollegala deposed that, Trust was holding a Joint SB Account No.64052245693 in SBM Kollegala Branch and on 14.11.2016, he deposited Rs.46,000/- to the said account containing denomination of Rs.500/- x 92. The concerned credit voucher is Ex.P.31(c) and writing initial made by him in the said credit voucher is marked as Ex.P.31(d). The evidence of PW.14 and Ex.P.31(c) and 31(d) make it clear that, PW.14 had deposited Rs.46,000/- in 92 notes of Rs.500/- denomination. But, Ex.P.37 Cash Denomination Report in that regard reveals that the accused No.1 himself received the said amount under his teller ID and received the amount as 460 notes of Rs.100/- denomination (460 x Rs.100/-) instead of 92 x Rs.500/-.
56. PW.16 G.B.Shivaswamy, who was holding SB Account bearing No.54014583326 in SBM Kollegala Branch deposed that, on 10.11.2016, he deposited total amount of Rs.1,03,500/- containing denominations of Rs.1000/- x 55 and Rs.500/- x 97. Except the said amount, he has not deposited any other amount. The prosecution has got marked the concerned credit voucher as per Ex.P.31(e) and initials and writing of the witness in 78 Spl.CC.159/2018 the said voucher as per Ex.P.31(f). He also deposed that he did not collect any corresponding withdrawal amount in Rs.100/- denominations. Thus, the evidence of PW.16 and Ex.P.31(e) and 31(f) reveal that PW.16 had deposited Rs.1,03,500/- on 10.11.2016 in Rs.1000/- x 55 and Rs.500/- x 97 denomination. In this regard, Ex.P.33 Cash Denomination Report is looked into, it reveals that the accused No.1 himself received the said amount under his teller ID and wrongly entered the received amount as 103 notes of Rs.1000/- denomination and one note of Rs.500/- denomination instead of 55 notes of Rs.1000/- denomination and 97 notes of Rs.500/- denomination (55 x Rs.1000/- + 97 x Rs.500/-).
57. PW.18 Sri. R. Ranganath, who was holding SB Account No.64053687732 in SBM Kollegala Branch deposed that, on 13.11.2016, he had deposited total amount of Rs.30 lakhs containing denomination of Rs.1000/- x 1299 and Rs.500/- x 1313, Rs.100/- x 9845 and Rs.50/- x 1200. He also identified the credit voucher relating to said amount as per Ex.P.31(g) and his writings and signature as per Ex.P.31(h). He further stated that he has not deposited any other amount in the said account and has not collected any corresponding withdrawal amount in Rs.100/- denomination apart from depositing Rs.30 lakhs in the said Branch. Thus, the evidence of PW.16 and Ex.P.31(g) and (h) make it clear that PW.18 had deposited Rs.30 lakhs on 13.11.2016 in 1299 notes of Rs.1000/- denomination, 1313 notes of Rs.500/- denomination, 9845 notes of Rs.100/-
79 Spl.CC.159/2018 denomination and 1200 notes of Rs.50/- denomination (1299 x Rs.1000/- + 1313 x Rs.500/- + 9845 x Rs.100/- + 1200 x Rs.50/-). In this regard, Ex.P.36 cash denomination report is verified, it reveals that the accused No.1 himself received the said amount under his teller ID and wrongly entered the received amount as 30000 notes of Rs.100/- denomination (30000 x Rs.100/-) instead of 1299 x Rs.1000/- + 1313 x Rs.500/- + 9845 x Rs.100/- + 1200 x Rs.50/- as found in Ex.P.31(g).
58. PW.19 Sri. Mahesh S. who was holding the C.A. No.54014597769, in the name of M/s. Lakshmi Agencies in SBM Kollegala Branch deposed that, on 12.11.2016, he had deposited in all Rs.5 lakhs under deposit voucher dated 12.11.2016 containing Rs.100/- currency notes of 4000 and Rs.50 currency notes of 2000 The concerned deposit voucher with his writing is marked as Ex.P.31(j). Therefore, it is clear that PW.19 had deposited Rs.5 lakhs on 12.11.2016 in 4000 notes of Rs.100/- denomination and 2000 notes of Rs.50/- denomination (4000 x Rs.100/- + 2000 x Rs.50/-) In this regard, Ex.P.35 Cash Denomination Report dated 12.11.2016 is verified, it is clear that the accused No.1 himself received the said under under his teller ID and wrongly entered the received amount as 1000 notes of Rs.500 denomination (1000 x Rs.500/-) instead of 4000 x Rs.100/- + 2000 x Rs.50/-.
59. PW.20 Sri.S.Rajashekhar, who was the Manager of SBM, Tellanuru Branch, deposed that, on 80 Spl.CC.159/2018 14.11.2016, an amount of Rs.1,20,00,000/- was deposited with detailed denomination written on the overleaf of the deposit voucher as Rs.1000 currency notes in 4000 notes and Rs.500/- currency notes in 1600 notes (Rs.1000/- x 4000 + Rs.500/- x 1600 = Rs.1,20,00,000/-) and the said amount was received by accused No.1, who was the Head Cashier / currency chest officer of SBM Kollegala Branch. He has also marked the deposit voucher as per Ex.P.53(a) and his signature as 53(a-i). Thus, from the evidence of PW.20 and Ex.P.53(a), it is clear that a sum of Rs.1,20,00,000/- was deposited in 4000 notes of Rs.1000/- denomination and 1600 notes of Rs.500/- denomination (4000 x Rs.1000/- + 1600 x Rs.500/-). Along with these facts, the contents of Ex.P.37 Cash Denomination Report dated 14.11.2016 is perused, it denotes that the said amount was received by accused No.1 under his teller ID and wrongly entered the received amount as 12000 notes of Rs.1000/- instead of 4000 notes of Rs.1000/- and 1600 notes of Rs.500/-.
60. PW.15 Sri. Danappa M.C. who was the Sr. Branch Manager of Syndicate Bank Kollegala Branch has deposed that, cheque bearing No.671873 of A/c. No.54014540348 was issued by Syndicate Bank, Kollegala Branch on 10.11.2016 to withdraw Rs.10 lakhs as legal tender was to be kept in the bank to the customers for the purpose of exchange of SBNs. He has also stated that he had not received any SBNs of the said amount. The prosecution has got marked the said cheque 81 Spl.CC.159/2018 as per Ex.P.32(a) and his signature found therein as per Ex.P.32(a-i). From the evidence of PW.15, it is clear that, under Ex.P.32(a), he had not received any SBNs for Rs.10 lakhs. But, if we consider the contents of Ex.P.33 Cash Denomination Report relating to the said cheque, in Ex.P.33, 92 SBNs of Rs.500/- denomination was shown to be paid. There is no entry on the backside of ExP.32(a) as to denominations of the amount paid. Therefore, it is clear that there is wrong entry as to payment of SBNs of Rs.500/- in Cash Denomination Report maintained by accused No.1.
61. PW.17 Sri. Prabhakar P.R. who was the Accountant in SBI, Kollegala Branch, in his evidence deposed that, cheque bearing No.575808 of the A/c. No.64057000757 was issued by him on 10.11.2016 for Rs.50 lakhs as legal tender was required to be kept in the branch to the customers for the purpose of exchange of SBNs. He has also stated that, there was no reason for him to receive SBNs for the said amount. He identified the cheque issued by him as per Ex.P.32(b) and his signature found therein as per Ex.P.32(b-i). From the evidence of PW.17, it could be gathered that, he had not received any SBNs for Rs.50 lakhs. It is noticed that the amount paid in denomination to the customers is entered on the backside of the cheque. The denomination entered there and the denomination shown in Ex.P.33 in respect of Ex.P.32(b) are not tallying and there is wrong entry in Ex.P.33 in that regard.
82 Spl.CC.159/2018
62. PW.21 Sri. Shivanshu Pathak, who was working as Agriculture Extension Officer in Canara Bank, Kollegala Branch deposed that, cheque bearing No.640745 dated 10.11.2016 of A/c. No.54014540337 for Rs.20 lakhs was issued for withdrawal of the of the said amount from the Currency Chest of Kollegala Branch to bring the cash as legal tender was required to be kept in the branch to the customers for the purpose of exchanging the SBNs. He also identified the said cheque as per Ex.P.32(c). He further deposed that their branch received currency equivalent to Rs.20 lakhs in 200 notes of Rs. 1000/- denomination (SBNs). 14000 notes of Rs.100/- denomination, 2000 notes of Rs.50/- denomination, 10000 notes of Rs.20/- denomination and 10000 notes of Rs.10/- denomination. At the overleaf of the Ex.P.32, denomination is written by the issuing person. Along with this evidence of PW.21 and Ex.P.32(c), the contents of Ex.P.33 in that regard is analysed, it is clear that the denomination of the currency paid were wrongly entered as Rs.500 x 2000 notes and Rs.2000 x 3, instead of the currency shown in Ex.P.32(c).
63. PW.23 Sri. Swaroop R.S., who was the Branch Manager of Lakshmi Vilas Bank, Kollegala Branch deposed that he had issued cheque dated 10.11.2016 bearing No.485497 of A/c. No.64088332110 for Rs.1 lakh signed by him to bring the cash as legal tender was required to be kept in the branch for customers for exchange of the SBNs. The said cheque is marked as Ex.P.32(e). He further deposed that his branch had 83 Spl.CC.159/2018 received currency equivalent to Rs.10 lakhs in the denomination of Rs.100/- currency notes in 4000 numbers, Rs.50/- currency notes in 8000 numbers, Rs.20/- currency notes in 10000 numbers. At the overleaf of Ex.P.32(e), the denomination is written by the issuing person. Along with this evidence, the contents of Ex.P.33 are looked into, it is clear that the denomination of the currencies paid were wrongly entered as 1000 x Rs.500/- and 7 x Rs.2000/- instead of actual currency paid as per Ex.P.32(e).
64. PW.28 Sri. Dayanand Singh, the Assistant Manager, Indian Overseas Bank (IOB) Kollegala Branch, deposed that, cheque bearing No.558809 for Rs.22 lakhs issued by the then Manager, Sri.Mrunal Pradeep and identified the said cheque as Ex.P.32(f) and the signature as per Ex.P.32(f-i). The debit voucher in that regard is marked as Ex.P.74. It is his further evidence that the amount mentioned in Ex.P.74 i.e., Rs.22 lakhs was given in denominations such as Rs.100/- x 14000, Rs.50/- x 6000, Rs.20/- x 20000 and Rs.10/- x 10000, which is mentioned on the backside of Ex.P.32(f). This evidence of PW.28 and Ex.P.74, 32(f) are looked into along with Ex.P.33, it is clear that in Ex.P.33, wrong entry is made in that regard by showing the currencies paid as Rs.500/- x 2200 and Rs.2000/- x 7 instead of the actual currency mentioned in Ex.P.32(f).
65. It is pertinent to note that the evidence of PW.13 to 23 and PW.28 and the documents marked 84 Spl.CC.159/2018 through them remained unchallenged and accused have not disputed the same. Thus, on going through the said oral and documentary evidence, it is clear that the accused No.1, being the head cashier and custodian of the currency chest, who is responsible to make proper entries in the bank account which was entrusted to him by virtue of his official position, entered wrong entries knowing fully well in that regard so as to suit the excess SBNs received by him in violation of the RBI guidelines. The accused No.1 has not given any explanation as to wrong entries made in the bank account entered by him. Under these attending circumstances, absolutely, there are no reason to disbelieve the case of the prosecution as to commission of the offence under Section 477A of the IPC as contended.
66. Therefore, on going through the entire oral and documentary evidence placed before this court, it clearly appears that the accused No.1, being the Head Cashier at SBM Kollegala Main Branch, entrusted with currency chest had exchanged the SBNs of Rs.500/- and Rs.1000/- by violating the circular issued by the RBI with dishonest intention and had exchanged excess SBNs with legal tender and manipulated the accounts of the Bank to suit the excess SBNs received and thereby committed the offence punishable under Section 409 and 477A of the IPC.
67. So far as the offence punishable under Section 13(1)(c) & (d) are concerned, the prosecution has 85 Spl.CC.159/2018 contended that the accused No.1 being the Head Cashier of SBM Kollegala Main Branch, during demonetization period, exchanged the SBNs for legal tender by corrupt or illegal means to obtain pecuniary advantage for accused Nos.2 and 4 without any public interest by abusing his official position and thereby committed the criminal misconduct under Section 13(1)(c) and (d) of the PC Act, which are punishable under Section 13(2) of the said Act. So far as these aspects are concerned, there is no need of much discussion in the light of the discussion and findings given in respect of the offence punishable under Section 409 and 477A of the IPC. As discussed in detail in connection with the offence under Section 409 and 477A of the IPC, the accused No.1 found to have committed the criminal breach of trust as well as falsification of the accounts to suit the excess SBNs received by him in violation of the direction of law i.e., circular issued by the RBI with regard to the exchange of SBNs for legal tender.
68. As discussed supra, the accused No.1 dishonestly misappropriated the property entrusted to him as a public servant and thereby dishonestly received the excess SBNs into currency chest of the bank which was entrusted to him in his official capacity and thereby allowed others to exchange the SBNs in violation of the RBI Circular. Therefore, it is clear that the accused No.1 being the public servant has committed the criminal misconduct as provided under Section 13(1)(c) of the PC Act. Further, it is also pertinent to note that the accused 86 Spl.CC.159/2018 No.1 being a Head Cashier, a public servant having custody of the currency chest, allowed exchange of SBNs by illegal means and by abusing his official position and thereby obtained a valuable thing or pecuniary advantage in favour of the person who received the legal tender for SBNs of huge amount as discussed supra in violation of the direction of law adversely affecting the public interest. Therefore, considering all these aspects, this court is of the considered view that the prosecution has proved the commission of the offence under Sections 409, 477A of the IPC and under Section 13(1)(c)&(d) punishable under Section 13(2) of the PC Act as against accused No.1 beyond reasonable doubt.
69. As discussed above in detail, the oral and documentary evidence clinchingly prove the commission of the offence by the accused No.1 and the argument of the learned counsel for accused No.1 that the accused No.1 is implicated in this case in order to protect PW.11 the Branch Manager, as well as the joint custodian of the currency chest PW.3 cannot be accepted. It is not the case of the prosecution that PW.3 and PW.11 were involved in exchange of SBNs in violation of the circular issued by RBI and even, it is not the case of the accused No.1 that, PW.3 and PW.11 had exchanged the SBNs in violation of the direction of law. Only at the time of argument, such contention has taken, which cannot be accepted in the light of the evidence available on record. The another contention of the learned counsel for the accused No.1 that the circular dated 8.11.2016 issued by 87 Spl.CC.159/2018 the RBI was challenged before the Hon'ble Supreme Court in W.P.No.906/2016 and all matters pending before various High Courts were taken before the Supreme Court and when the matters were pending before the Supreme Court, the Government has passed the Specified Bank Notes (cessation of the liability) Act 2017 and thereby the circular issued by RBI had no force and hence, the case of the prosecution cannot be accepted is also found to be merit less. No doubt, the demonetization notification dated 08.11.2016 issued by the RBI was challenged before the Hon'ble Supreme Court and in that regard, the ld. Sr. Public Prosecutor has relied on the decision of the Hon'ble Supreme Court in the case of Vivek Narayan Sharma and Others Vs. Union of India and Others, which is popularly known as Demonetization Case, wherein, the Hon'ble Supreme Court has pleased to uphold the legality of the demonetization circular issued by the RBI. The Specified Bank Notes (cessation of the liability) Act, 2017 has no application to the facts of the present case. Even, the learned counsel could not convince this court in this regard except making such submission. Therefore, the said contention of the learned counsel for accused No.1 cannot be accepted.
70. The another contention of the learned counsel for accused No.1 that the Branch Manager, who was liable for day to day transaction of the Bank and PW.3 who was the Joint Custodian of the Currency Chest with accused No.1 were let free and thereby the accused No.1 88 Spl.CC.159/2018 is also required to be set free is also not acceptable one. No doubt, as admitted by PW.1, the Branch Manager is responsible for day to day bank transaction that were taking place in the branch. Further, PW.3 being the Joint Custodian of the Currency Chest of the Bank, equally responsible for maintaining the Currency Chest and relevant records. But, as already stated there is no allegation against the Branch Manager and Joint Custodian of the Currency Chest (PW.11 and PW.3) as to violation of RBI guidelines and the allegation is found only against accused No.1 in that regard, which is foundtbe proved after holding the full fledged trial. Even, the accused No.1 has not taken such contention during entire trial except during the course of argument.
71. The another limb of the argument of the learned counsel for accused No.1 that the Branch Manager has not communicated the circular to accused No.1 and there was no written work order issued by the Branch Manager and the evidence placed before the Court does not show any dishonest intention on the part of accused No.1 are concerned, it is noticed from the evidence on record that the PW.11, being the Branch Manager had not issued the office order as such but the evidence on record reveals that PW.11 being the Branch Manager had given oral instruction with regard to the circular regarding demonetization and the procedure to be followed. In this regard, in the evidence of PW.4 and PW.5, who were working in the SBM Kollegala Branch specifically stated that CW.11 was the Branch Manager 89 Spl.CC.159/2018 when the demonetization was declared and he orally instructed them to receive the old currency notes of Rs.500/- and Rs.1000/- from the customers, verify the passbook and collect the proper vouchers from the exchanging customers and verify their identification in the account record, if found genuine, receive the old currency and prepare the slip as per requirements and if the amount to be exchanged, it was to be directly to be paid to the customers pay it in the counter and if the amount was to be received and transferred to the account of the customers, that has to be done by preparing the slip as per rules. Even PW.25 in his evidence specifically stated that PW.11 had orally briefed them regarding demonetization scheme and process of exchange of banned notes with new notes declared by the Government. In that regard, instructed to follow the rules during the phase of demonetization. Thus, the evidence of PW.4, PW.5 and PW.25, who were working in the SBM Kollegala Branch reveals that the proper instructions were given to the staff.
72. Further, in this regard, PW.11 in his evidence specifically stated that all guidelines provided by RBI were informed to his staff and ordered them to strictly follow the same and further informed that customers exchange right of Rs.1000/- and Rs.500/- notes was restricted to Rs.4,000/- per day and also without any supportive documents of KYC, to be accepted with Annexure V issued by the RBI. Under these attending circumstances, there are no reasons to hold that PW.11 90 Spl.CC.159/2018 had not informed the circular issued by the RBI with regard to the demonetization. Apart from that, the accused No.1 being the Head Cashier, who is in-charge of Currency Chest cannot work without knowing the circular of the RBI for exchanging the SBNs. No doubt, from the evidence, it is clear that no written communication was made by the Branch Manager by preparing office proceedings in writing, but the evidence reveals that oral instruction of the circular was specifically given to the staff members. Therefore, the contention of the accused No.1 that the Branch Manager has not communicated the circular to the accused No.1 cannot be accepted. Further, the dishonest intention on the part of the accused No.1 is concerned, as already discussed in detail, he has not only received excess SBNs under his transaction ID without proper proof and as per the requirements of the RBI, but also dishonestly altered the Cash Denomination Report maintained by the Bank, which was in his custody. Therefore, it cannot be said that accused No.1 had no dishonest intention. Therefore, the said argument of the learned counsel accused No.1 cannot be accepted.
73. Further, the learned counsel for the accused No.1 has submitted that the investigation conducted by the IO is perfunctory and though the accused No.1 is innocent, he has been falsely implicated to save the then Branch Manager, but absolutely there are no materials to accept the said contention in any manner and this court 91 Spl.CC.159/2018 did not find any substance in the said contention of the accused.
74. As already stated, in this case, the accused Nos.2 to 4 are tagged under Section 120A of the IPC along with accused No.1 for the commission of the offence leveled against them. Therefore, it is not sufficient for the prosecution to prove the offence leveled against the accused No.1, but it has to prove the conspiracy entered into between the accused No.1 to 4 as contended.
75. In this regard the prosecution case is analysed, it is noticed that prosecution has alleged two conspiracy for the purpose of exchange of SBNs for legal tender character. One is between accused Nos.1 and 2 and another one is between accused Nos.1, 3 and 4. Therefore, the prosecution has to prove these two conspiracies for the commission of the offences against the accused persons for which, they were charged.
76. As argued by the learned counsel for the accused No.2 relying on the decision of the Hon'ble Supreme Court in Crl.A.2256/2011 in the case of Balla @ Farhat Vs. State of Madhya Pradesh, wherein the Hon'ble Supreme Court held that "There cannot be a conspiracy by only one accused and it is necessary for the applicability of Sec.120 B of the IPC that there must be two or more persons agreeing for the purpose of conspiracy". In the present case on hand, the prosecution alleged one set of conspiracy between accused Nos.1 and 2 and another 92 Spl.CC.159/2018 between accused Nos.1, 3 and 4 for commission of the offence charged.
77. In the another decision relied by the learned counsel for the accused No.2 in Crl.A.No.1571/2021 (arising out of S.L.P.(Crl.)No.5438/2020 in the case of Parveen @ Sonu Vs. The State of Haryana, the Hon'ble S.C. specifically observed that ;
"It is fairly well settled, to prove the charge of conspiracy, within the ambit of Section 120-B, it is necessary to establish that there was an agreement between the parties for doing an unlawful act. At the same time, it is to be noted that it is difficult to establish conspiracy by direct evidence at all, but at the same time, in absence of any evidence to show meeting of minds between the conspirators for the intended object of committing an illegal act, it is not safe to hod a person guilty for offences under Section 120-B of IPC. A few bits here and a few bits there on which prosecution relies, cannot be held to be adequate for connecting the accused with the commission of crime of criminal conspiracy."
78. At this stage, it is appropriate to refer the decision of the Apex Court relied by the Learned counsel for the accused No.3 reported in 2022 Live Law(SC) 709 in the case of Ram Sharan Chathurvedi Vs. The State of Madhya Pradesh, wherein the Hon'ble Apex Court has 93 Spl.CC.159/2018 considered the link necessary for proving the charge of conspiracy. In Para 22 to 25 of the Judgment, the Hon'ble Supreme Court of India has observed as under:
"The principal ingredient of the offence of criminal conspiracy under Sec.120B of the IPC is an agreement to commit an offence. Such an agreement must be proved through direct or circumstantial evidence. Court has to necessarily ascertain whether there was an agreement between the Appellant and A-1 and A-2. In the decision of State of Kerala v. P. Sugathan and Anr.2, this Court noted that an agreement forms the core of the offence of conspiracy, and it must surface in evidence through some physical manifestation"
"12....As in all other criminal offences, the prosecution has to discharge its onus of proving the case against the accused beyond reasonable doubt. ...A few bits here and a few bits there on which the prosecution relies cannot be held to be adequate for connecting the accused with the commission of the crime of criminal conspiracy...
13. The most important ingredient of the offence being the agreement between two or more persons to do an illegal act. In a case where criminal conspiracy is alleged, the court must inquire whether the two persons are independently pursuing the same end or they have come together to pursue the unlawful object. The former does not render them conspirators but the latter does. For the offence of conspiracy some kind of physical manifestation of agreement is required to be established. The express agreement need not be proved. The evidence as to the transmission of
94 Spl.CC.159/2018 thoughts sharing the unlawful act is not sufficient..." (emphasis supplied)
23. The charge of conspiracy alleged by the prosecution against the Appellant must evidence explicit acts or conduct on his part, manifesting conscious and apparent concurrence of a common design with A-1 and A-2. In State (NCT of Delhi) v. Navjot Sandhu, this Court held:
"101. One more principle which deserves notice is that the cumulative effect of the proved circumstances should be taken into account in determining the guilt of the accused rather than adopting an isolated approach to each of the circumstances. Of course, each one of the circumstances should be proved beyond reasonable doubt. Lastly, in regard to the appreciation of evidence relating to the conspiracy, the Court must take care to see that the acts or conduct of the parties must be conscious and clear enough to infer their concurrence as to the common design and its execution." (emphasis supplied)
24. In accepting the story of the prosecution, the Trial Court, as well as the High Court, proceeded on the basis of mere suspicion against the Appellant, which is precisely what this Court in Tanviben Pankajkumar Divetia v. State of Gujarat4, had cautioned against:
"45. The principle for basing a conviction on the basis of circumstantial evidences has been indicated in a number of decisions of this Court and the law is well settled that each and every incriminating circumstance must be clearly established by reliable and clinching evidence and the circumstances so proved must form a 95 Spl.CC.159/2018 chain of events from which the only irresistible conclusion about the guilt of the accused can be safely drawn and no other hypothesis against the guilt is possible. This Court has clearly sounded a note of caution that in a case depending largely upon circumstantial evidence, there is always a danger that conjecture or suspicion may take the place of legal proof. The Court must satisfy itself that various circumstances in the chain of events have been established clearly and such completed chain of events must be such as to rule out a reasonable likelihood of the innocence of the accused. It has also been indicated that when the important link goes, the chain of circumstances gets snapped and the other circumstances cannot, in any manner, establish the guilt of the accused beyond all reasonable doubts. It has been held that the Court has to be watchful and avoid the danger of allowing the suspicion to take the place of legal proof for sometimes, unconsciously it may happen to be a short step between moral certainty and legal proof. It has been indicated by this Court that there is a long mental distance between "may be true" and "must be true" and the same divides conjectures from sure conclusions. (Jaharlal Das v. State of Orissa (1991) 3 SCC 27)" (emphasis supplied).
25. It is not necessary that there must be a clear, categorical and express agreement between the accused. However, an implied agreement must manifest upon relying on principles established in the cases of circumstantial evidence. Accordingly, in the majority opinion of Ram Narayan Popli v. CBI, this Court had held:
"354. ... For the offence of conspiracy some kind of physical manifestation of agreement is 96 Spl.CC.159/2018 required to be established. The express agreement need not be proved. The evidence as to the transmission of thoughts sharing the unlawful act is not sufficient..."
79. In the light of the above guiding principles and the ingredient necessary to constitute the offences under Sec.120A punishable under Sec.120B of the IPC, the facts of the present case as to conspiracy between accused Nos..1 and 2 are analysed, there was no any written agreement between them and the case of the prosecution is entirely based on the circumstantial evidence, which has to be gathered from the materials placed before the Court. It is pertinent to note that admittedly accused No.1 was the student of accused No.2 and there are well acquainted with each other. As already discussed, admittedly, the accused No.1 had exchanged the currency notes in favour of accused No.2 as he was regular customer of SBM, Kollegal Branch. However, the accused No.1 has contended that the exchange of currency was at the instruction and instance of the Branch Manager. But, absolutely, there are no materials before this Court to show that accused No.1 had exchanged the SBNs of accused No.2 for legal tender at the instance and instruction of the Branch Manager. The accused No.1 being the Head Cashier and custodian of the Currency Chest of the Bank has to follow the norms prescribed under the circular issued by the RBI and also the circulars issued by the Head Office of the SBM with regard to receiving of SBNs for legal tender. He cannot contend that at the instruction of the Branch 97 Spl.CC.159/2018 Manager, he violated the RBI circular which is mandatory to be followed. The accused has not produced any material before this Court that he had exchanged the legal tender for SBNs of Rs.10 lakhs in favour of accused No.2 in accordance with the RBI circular in that regard.
80. The evidence on record reveals that admittedly the accused No.2 was having an account in SBM, Kollegal Branch and the suggestions put to the mouth of the IO on behalf of the accused No.2 make it clear that accused No.2 got exchanged Rs.10 lakhs. Therefore, it is clear that accused No.2 had got exchanged SBNs. of Rs.10 lakhs from accused No.1 as put up by the prosecution and that exchange of SBNs is found to be contrary or in violation of RBI circular. Since accused No.2 was having the account in SBM, Kollegal Branch, he could have deposited the SBNs in his account as per the circular issued by the RBI, wherein there was no limit for depositing any amount in SBNs. But, the accused No.2 had exchanged SBNs. through accused No.1 to the tune of Rs.10 lakhs otherwise than through account for the reason best known to him. Under these attending circumstances, there is no other inference except that both of them with mutual understanding or agreement got exchanged the SBNs to the tune of Rs.10 lakhs, in respect of which, the accused No.1 had committed the offence punishable under Sec.409 and 477A of the IPC to balance the SBNs. received contrary to the RBI circular. No other hypothesis against the guilt is possible.
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81. Along with the above aspects, one more factor is also to be considered which corroborates the case of the prosecution further in this regard. The accused No.2 is not disputing the seizure of Rs.10 lakhs from him, which is identified as MO.7 and he claims the said amount belongs to him. It is his contention that the said amount was his retirement benefits kept in the FD in SBM, Kollegal Branch and he had withdrawn the said amount about 2-3 months prior to the demonetization for purchasing a site. The said amount was exchanged and was seized from his residence and not from the graveyard of his wife as put up by the prosecution. The learned counsel for the Accused No.2 at the time of argument filed a memo with copy of term certificate dtd.15-03-2013 and also the account statement relating to the account of accused No.2 maintained with SBM, Kollegal Branch (Now SBI, Kollgal Branch) to show that the accused had deposited a sum of Rs.10 Lakhs in Term Deposit on 15- 03-15 and the said term deposit was matured on 15-03- 2016 and he had withdrawn the amount of Rs.13 lakhs from his account in March 2016. No doubt, the said documents reveal that the accused No.2 has deposited amount with SBM, Kollegal Branch and also withdrawal of Rs.13 lakhs by him. But, only on that account, it cannot be said that the very same amount was exchanged by him in November 2016. If at all, the withdrawn amount was not used by him, he could have kept this amount in his account being a prudent person. There is no any explanation by the accused No.2 in that regard.
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82. So far as the place of recovery of MO.7 is concerned, the evidence of PW.7,12, 27 and of IO is looked into along with Ex.P27 seizure mahazar and Ex.P.28 Photographs, there remains no doubt that the said amount was seized from Graveyard of the wife of accused No.2 and not from his house as stated by him. PW.7 Sri.Naveen B.S. being the witness to Ex.P.27 seizure Mahazar, in his evidence specifically stated as to in which place mahazar was conducted, who had taken them to the said place, who had handed over the cash (MO.7) to IO, how the said amount was kept in the said place and also preparing of panchanama in the spot by the IO as per Ex.P.27 and taking of photographs as per Ex.P.28 at that time. Though the learned counsel for accused No.2 has cross-examined the said witness nothing was elicited from his mouth so as to disbelieve his evidence in support of the prosecution case in this regard. There are no grounds to disbelieve his evidence as to seizure of MO.7 from the burial place of wife of accused No.2. Further, PW.12 Dr. Syed Hidayathulla, who is none other than the son of the accused No.2 being one of the witnesses to the seizure mahazar specifically stated that MO.7 cash amount was seized from the graveyard of his mother. He clearly supported the case of the prosecution in that regard. There are no reasons for disbelieving his evidence. In addition to that, PW.27, who is also one of the witnesses to Ex.P.27, deposed in support of the prosecution case as to seizure of MO.7 from the graveyard of the wife of the accused No.2. Though the learned Counsel for accused No.2 has cross-examined 100 Spl.CC.159/2018 the witnesses he could not elicit anything worth from their mouth so as to disbelieve their evidence and thereby the case of the prosecution and to show that MO.7 was recovered from the house of accused No.2 and not from the graveyard of his wife.
83. Further, the evidence of IO also clearly support the case of the prosecution as to seizure of MO.7 cash from the graveyard of the wife of the accused No.2. Therefore, on conjoint reading of evidence of these witnesses and contents of Ex.P.27 and 28, there remains no doubt that MO.7 cash was recovered and seized from the graveyard of the wife of the accused No.2 as put up by the prosecution and not from the house of the accused No.2 as contended by him. It is clear that the accused No.2 has tried to put up false contention in this regard. This conduct of the accused No.2 makes it clear that he wants to suppress the real facts, for the reason best known to him and come up with false contentions, which discloses the dishonest intention on his part. It is also pertinent to note that keeping of the money in the graveyard by the accused No.2 is found to be contrary to the conduct of the prudent person. Since, he is having bank account, he could have kept the amount in the account. This conduct of the accused appears to be very strange and there is no explanation from the accused No.2 in that regard.
84. At this stage, it is also pertinent to note that as argued by the learned counsel for accused No.2, during cross-examination, the IO has admitted that 101 Spl.CC.159/2018 accused No.2 had not given any extra money for exchange of notes to the tune of Rs.10 lakhs and he also stated during cross-examination that there was no any loss to the State Exchequer or Central Exchequer or to RBI. But, only on the basis of the said evidence of the IO during cross-examination, it cannot be said that no case is made out against the accused persons. It is needless to say that, if the SBNs were exchanged for legal tender in violation of RBI circular, definitely, it has adverse effect on the economy of the country and defeat the very purpose of demonetization itself. On going through the facts of the present case along with the relied decision by the learned counsel for accused No.2, this court found that both decisions are of no assistance to the accused No.2 in any angle and the said decisions cannot be made applicable to the facts of the present case so as to accept the case of the accused No.2.
85. Thus, considering the above aspects this Court has no hesitation to hold that the circumstances made out by the prosecution on the basis of the materials placed before the Court unerringly reveal the conspiracy between accused Nos.1 and 2 in the matter of exchanging of SBNs for legal tender character as put up by the prosecution in violation of the RBI circular. Therefore, this Court is of the firm view that the materials placed before this Court are sufficient to hold that there was a criminal conspiracy between accused No.1 and 2 in the matter of exchanging of SBNs for legal tender character in violation of the RBI circular and accordingly, accused 102 Spl.CC.159/2018 No.2 had got exchanged SBNs of Rs.10 lakhs for legal tender character from accused No.1. The circumstances made out by the prosecution will form a chain of events from which the only irresistible conclusion about the guilt of the accused No.1 and 2 can safely be drawn and no other hypothesis against the guilt is possible.
86. Now, the 2nd set of alleged conspiracy between accused Nos.1, 3 and 4 are analyzed, here also, there is no any written agreement between them and the case of the prosecution in this regard again is based on the circumstantial evidence and matter has to be assessed from the circumstances made out by the prosecution on the basis of the oral and documentary evidence placed before this Court. In this regard, it is pertinent to note that no where the prosecution has contended that the accused No.1 and accused No.4 were acquainted with each other and there was a conspiracy between them. But, the case of the prosecution as found from the evidence on file in this regard is that, the accused No.3 being the friend of accused No.4, took the SBNs of Rs.6 lakhs from the accused No.4 and exchanged the same in SBM Kollegala Main Branch in conspiracy with the accused No.1 and handed over the legal tender of Rs.6 lakhs so exchanged to accused No.4.
87. In this case, as already stated, there is no dispute as to search of the house of the accused No.3 and 4 and also search of the bank lockers of the accused No.4 and his wife and recovery of Rs.6 lakhs from the bank locker of the wife of the accused No.4 and also recovery of 103 Spl.CC.159/2018 sum of Rs.6,87,500/- from the house of accused No.4 which includes old demonetized currency notes of Rs.500/- and Rs.1000/-. The amount of Rs.6 lakhs seized from the locker of the wife of the accused No.4 is identified as MO.1 to 6 and accused No.4 is claiming his right over the said amount and there is no dispute as to identity of the same. A sum of Rs.6,87,500/- seized from the house of the accused No.4 is not the subject matter of the present case. The said seized amount has been released in favour of the accused No.4 as per order dated 03.11.2018 and out of the said amount, even, the accused No.4 was permitted to exchange the old demonetized currency notes of Rs.500/- and Rs.1000/- in accordance with law.
88. To establish the alleged conspiracy, the prosecution has relied upon the statement of the PW.8 and the evidence of the IO. However, on going through the evidence of PW.8, it is noticed that he did not support the case of the prosecution as against accused No.3 and 4. In his evidence, he has stated that the IO did not enquire him anything about accused No.3 with regard to his participation in exchanging the demonetized currency. In this regard, the learned Public Prosecutor has cross-examined the said witness and the witness had denied the statement given to the IO, wherein, he has stated that accused No.3 was assisted by accused No.1 in exchange of Rs.6 lakhs and the portion of the 104 Spl.CC.159/2018 statement of the said witness is marked as Ex.P.29. Therefore, the evidence of PW.8 is of no assistance to the prosecution to establish the conspiracy between accused No.1, 3 and 4 in any manner.
89. Now, the evidence of the IO is analysed, the IO in his evidence has stated that he was informed by Sri.S.Subramanya (PW.31), that accused No.3 had exchanged the money of Rs.6 lakhs SBNs with new currency. The accused No.3 had confessed before him by stating that these Rs.6 lakhs have been handed over to accused No.4. It is further evidence of the IO that, on the basis of the collection of evidence, he arrested accused No.3 and interrogated him who confessed to the fact that he got exchanged Rs.6 lakhs SBNs with the help of accused No.1 to help his friend accused No.4. The IO has further stated in his evidence that on 7.12.2016, during the search at the residence of accused No.1, they received information from accused No.1 that demonetized currency of Rs.6 lakhs was exchanged for new notes with Mr.K.Michael (accused No.3) and while viewing the CCTV footage, accused No.1 identified accused No.3 and other officials. It is further stated by him that during search, it came to the light that accused No.3 K. Michael is a close friend of accused No.4 and had exchanged money on the request of the accused No.4 at SBM Kollegala 105 Spl.CC.159/2018 Branch with the assistance of accused No.1. Except this evidence, there is no any other evidence available on behalf of the prosecution to support the theory of conspiracy. It is also not the case of the prosecution that accused No.4 himself visited the SBM Kollegala Branch and had exchanged the SBNs for legal tender with accused No.1.
90. It is also pertinent to note that, at the time of recording the statement of accused under Section 313 of the Cr.P.C., the accused No.3 while answering question No.285 specifically stated that, accused No.4 is not his friend. Absolutely, no evidence is placed before this court to show that accused No.3 and 4 are friends and known to each other. It is also noticed that absolutely there is no evidence to show that there was meeting of mind between accused Nos.3 and 4 in the matter of exchanging of the SBNs and accused No.4 had handed over the SBNs of Rs.6 lakhs to accused No.3 so as to exchange the same by him.
91. Further, there is no convincing and acceptable evidence that accused No.3 had exchanged SBNs of Rs.6 lakhs from accused No.1 and handed over the said exchanged money of Rs.6 lakhs to the accused No.4. It is pertinent to note that, during the evidence, as already stated, the IO has specifically stated that he received information from 106 Spl.CC.159/2018 accused No.1 that demonetized currency of Rs.6 lakhs was exchanged for new notes with accused No.3 and also stated that accused No.3 has confessed to the fact that he got exchanged Rs.6 lakhs SBNs with the help of accused No.1 to help his friend accused No.4. But, for the reason best known to the IO, he has not recorded the confession statement of accused Nos.1 and 3, which is found to be the basis for making allegations against accused Nos.3 and 4, though accused Nos.1 and 3 were arrested by him. Further, it is also noticed that as deposed by the IO, he was informed by S.Subramanya that accused No.3 had exchanged the money of Rs.6 lakhs SBNs with new currency and accused No.3 had confessed before him by stating that these Rs.6 lakhs have been handed over by accused No.4. But, this fact was not stated by the said Sri. S.Subramanya, who was examined before this court as PW.31. No doubt, as stated by the IO, on examination of CCTV footage, accused No.3 is seen assisting accused No.2 to put the money in the bag. But, only on that basis, it cannot be said that accused No.3 had exchanged the SBNs for legal tender as put up by the prosecution. Therefore, under these attending circumstances, it is clear that absolutely there is no evidence to prove the meeting of minds between accused Nos.1, 3 and 4 to exchange the SBNs of accused No.4 as put up by the prosecution.
107 Spl.CC.159/2018
92. At this stage, it is also pertinent to note that as found in Ex.P.25 i.e., Locker Operation Proceedings dated 12.12.2016, whereby, the IO had seized Rs.6 lakhs from the locker of the wife of the accused No.4 and the serial number of the currency seized in 6 bundles were shown in the said document. The serial number of the new currency notes of Rs.100/- shown in the Locker Operation Proceedings, if compared with the new currency notes sent by RBI to the SBM Kollegala Branch as per Ex.P.62, the seized currency notes were not supplied to the Kollegala Branch as serial numbers of the seized currency notes are not found in Ex.62. Added to that, even Ex.P.86, which is the letter dated 23.01.2017 issued by RBI to the IO is looked into, it reveals as to supply of new currency notes of Rs.100/- denomination with currency note serial number to various Banks including SBM Kollegala Branch. The currency note serial number stated in the said letter which was sent to SBM Kollegala Branch is also not tallying with the currency notes serial numbers i.e., MO.1 to 6 seized from the locker of the wife of accused No.4. It is not understood when the seized currency notes of Rs.100/- denomination were not supplied to the SBM Kollegala Branch, how the said currency notes were being exchanged from the SBM Kollegala Branch. There is 108 Spl.CC.159/2018 no clarity in this regard in the case of the prosecution. Therefore, on the basis of the available evidence, it cannot be held that MO.1 to 6 seized from the Bank locker of the wife of the accused No.4 were exchanged from SBM Kollegala Branch. In that regard, the case of the prosecution is totally vague, unclear and shabby. Absolutely, there is no evidence to show that the MO.1 to 6 were exchanged from SBM Kollegala Branch.
93. Thus, under the above attending circumstances, the case of the prosecution that accused No.4 got exchanged SBNs of Rs. 6 lakhs with the assistance of accused No.3 through accused No.1 from SBM Kollegala Branch cannot be accepted. There is no required and acceptable evidence to establish any conspiracy between accused No.1, 3 and 4 in the matter of exchanging of SBNs as put up by the prosecution. Therefore, this court is of the firm view that the material placed before this court are not sufficient to hold that there was a conspiracy between accused Nos.1, 3 and 4 in the matter of exchanging the SBNs and accused No.4 had got exchanged the SBNs in the form of MO.1 to 6 with the help of accused No.3 and accused No.1 from SBM Kollegala Branch. Hence, the second set of conspiracy put up by the prosecution as against accused Nos.1, 3 and 4 cannot be accepted.
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94. Thus, for the reasons discussed above in detail, this court is of the considered opinion that the prosecution has proved the conspiracy between accused Nos.1 and 2 in the matter of exchanging the SBNs of Rs.10 lakhs in favour of accused No.2 by accused No.1 from SBM Kollegala Branch in violation of RBI circular. On the other hand, the prosecution has totally failed to establish the conspiracy between accused No.1, 3 and 4. It appears that even there are loopholes in the investigation of the matter as against accused Nos.3 and 4. Hence, the prosecution has successfully proved the charge against accused Nos.1 and 2 beyond all reasonable doubt and failed to prove the case against accused Nos.3 and 4. Accordingly, Point Nos.2 to 5 are answered in the affirmative as against accused Nos.1 and 2 and in the negative as against accused Nos.3 and 4.
95. Point No.6 : For the reasons discussed in connection with Point Nos.1 to 5 and findings given thereon, this court proceed to pass the following;
ORDER Acting under Section 235(1) of the Cr.P.C., the accused Nos.3 Sri. Michael Katookaran and accused No.4 Sri. Wills Warunny, are acquitted of the offences punishable under Sections 120B of the 110 Spl.CC.159/2018 Indian Penal Code and under Section 409, 477A R/w. Sec.120B of the IPC and Sec.13(1)
(c) &(d) R/w. Sec.13(2) of the PC Act.
Acting under Section 235(2) of the Cr.P.C., accused No.1 Parashivamurthy Mallunathan and accused No.2 Sayed Quiam are convicted for the offence punishable under Section 120B of the IPC.
Acting under Section 235(2) of the Cr.P.C., accused No.1 and accused No.2 are convicted for the offences punishable under Sections 409, 477A R/w. Sec.120B of the IPC.
Acting under Section 235(2), the accused No.1 is convicted for the offence under Section 13(1)(c) & (d) punishable under Section 13(2) of the Prevention of Corruption Act, 1988.
The bail bond of the accused Nos.1 to 4and their sureties stand cancelled.
To hear regarding sentence.
(Dictated to the Stenographer Gr.I directly on the computer, corrected and then pronounced by me in the Open Court on this the 29th day of August, 2024) (Shridhar Gopalakrishna Bhat) XXI Addl. City Civil and Sessions Judge, & Prl. Special Judge for CBI Cases, Bengaluru.
111 Spl.CC.159/2018 ORDER REGARDING SENTENCE In the instant case, the accused No.1 Sri. Parashivamurthy Mallunathan and 2 Sri. Sayed Quiam are convicted for the offences punishable under Section 120B and under Sections 409, 477A of the IPC and Sec.13(1)(c) & (d) R/w. Sec.13(2) of the PC Act R/w. Sec.120B of the IPC.
2. Heard the learned counsel for accused Nos.1 and 2 and also accused Nos.1 and 2 and the learned Senior Public Prosecutor, regarding sentence.
3. The learned counsel for accused Nos.1 and 2 vehemently argued that the offences alleged against the accused Nos.1 and 2 are not grievous in nature and no loss has been caused to the Bank or Exchequer of the State or Central Government or even to the RBI and the alleged effect of the offences is only an imaginary one. Even, the IO himself has admitted that no loss was caused either to the Bank or Exchequer of the State or Central Government and to the RBI. Further, the accused Nos.1 and 2 have not gained any additional benefit. It is also submitted that the accused No.1 is suffering from heart problem and he is under treatment and he is also no more in service of the Bank. Further, he has to look after the family. Accused No.2 is a senior citizen, retired Teacher, who is also suffering from 112 Spl.CC.159/2018 high diabetes and heart problem and other various ailments. Accordingly, they have sought to take lenient view in the matter of sentence and prayed for awarding minimum sentence as permissible under law.
4. The accused Nos.1 and 2, who are before the court also submitted in the same tone as submitted by their learned counsels and prayed for lenient view in their favour.
5. The learned Senior Public Prosecutor submitted that the offences against the accused persons are proved beyond reasonable doubt and the court has to consider the conduct of the accused, gravity of the offence committed by them and also the effect of the offence on the economic system of the country as the offence involved in this case is majorly affecting the economic system of the country. It is further submitted that by virtue of the act of the accused No.1, more than Rs.1,55,00,000/- of SBNs have been illegally regularized with legal tender currency without any proof in violation of RBI guidelines which affected the very purpose of the demonetization policy introduced by the Government of India and there cannot be considered as a misnomer or due to rush of work. Further, the economic offences are to be considered as a class and the same requires to be considered stringently and no lenient view can be taken. Accordingly, she has sought for convicting the accused by imposing 113 Spl.CC.159/2018 maximum imprisonment and also for imposing suitable fine. It is also submitted by her that the sentence which is to be imposed by the court should be proportionate to the offence committed by the accused and it should not act as plea bite and it should serve the purpose for which the punishment to be imposed. Accordingly, prayed for awarding maximum sentence and also suitable fine on accused Nos.1 and 2.
6. It is needless to say that, in the matter of imposing the sentence on the accused, this court has to hear the accused persons on the sentence, consider the aggravating and mitigating circumstances, gravity of the offence, the purpose of the punishment being imposed, effect of the offence committed on the society and the facts and circumstances of the case, under which the offence took place. The important aspect of socio-economic offences is also to be emphasized with the gravity of the harm caused to the society. In the present case on hand, it is pertinent to note that the act of the accused persons has affected the very purpose of implementation of the demonetization and found that huge amount of SBNs have been regularized unauthorizedly affecting the economic system and the very Government policy itself. The said act cannot be considered as a minor act and even the Court has to take serious note of the offence committed by them which bleeds the very economic 114 Spl.CC.159/2018 system of the country and the policy of the Government introduced.
7. Further, at the same time, the nature of the actus reus for facilitating the commission of the offence is also to be taken into consideration. The accused No.1, who was entrusted with the property of the Bank which is the public fund had taken undue advantage of the trust/ faith reposed on him in that regard and accused No.2 has taken undue advantage of the situation to have the personal gain/ advantage for him. Under these circumstances, the act of misconduct which is proved against accused No.1 is to be considered seriously. It is also pertinent to note that though it has been argued by the learned counsel for the accused that there are no materials to indicate that the accused No.1 has got any benefit by exchanging the SBNs, the Court has to consider the act of his misconduct and breach of trust and its effect.
8. Section 409 of the IPC, provides for punishment for criminal breach of trust by public servant and the said offence is punishable with imprisonment for life or with imprisonment of either description for a term, which may extend to 10 years and shall also liable to fine.
9. Similarly, the offence of falsification of accounts as per Section 477A of the IPC is punishable with imprisonment of either description 115 Spl.CC.159/2018 for the term which may extend to 7 years or with fine or with both.
10. Similarly, the offence under Section 13(1)
(c) & (d) which is punishable under Section 13(2) of the PC Act with imprisonment which shall not be less than 1 year but which may extend to 7 years and shall also liable for fine. However, by virtue of the amendment Act, 2018 (16 of 2018 w.e.f. 26.07.2018), the minimum imprisonment was increased to 4 years and maximum to 10 years. In this case, the offence took place in the year 2016 and hence the law prevailing earlier to 2018 amendment is applicable.
11. Section 120B of the IPC, provides that whoever party to a criminal conspiracy to commit offence punishable with death, imprisonment for life or rigorous imprisonment for a term of 2 years or upwards shall, where no express provision is made under the Code for punishment of such conspiracy, be punished in the same manner as if he had abetted the such offence. Section 109 of the IPC, provides for punishment for abetment, if the abetted act is committed in consequence and where no express provision is made for its punishment. As per the said provision, abetment is punishable with the punishment provided for the offence. In the Code, there is no express provision for punishment of conspiracy to commit the offence under Section 409 and falsification of accounts under Section 477A 116 Spl.CC.159/2018 of the IPC. It is also pertinent to note that the term 'offence' is defined under Section 40 of the IPC, which includes the offence described under the special law. Therefore, the punishment prescribed for the offence punishable under Section 13(2) of the PC Act is also applicable to the conspirator. Hence, as provided under Section 109 of the IPC, the punishment provided for the offences under Sections 409 and 477A of the IPC and Sec.13(2) of the PC Act are applicable to the conspirator i.e., to accused No.2 also.
12. Having said so, it is needless to say that the Court has to consider the mitigating factors which are in favour of the accused persons. In this regard, this court has also considered the mitigating circumstances expressed by the learned counsels for accused Nos.1 and 2. Thus, having considered the facts and circumstances of the case, nature and gravity of the offences, its effect on the society, the purpose of the punishment, aggravating and mitigating circumstance of the case etc., this court proceed to pass the following ;
ORDER
The accused No.1 Parashivamurthy
Mallunathan and accused No.2 Sri. Sayed Quiam, are convicted for the offence punishable under Section 120B R/w.
Sec.409, 477A of the IPC and they are 117 Spl.CC.159/2018 sentenced to undergo rigorous imprisonment for a period of 5 years and to pay a fine amount of Rs.10,000/- each and in default of payment of fine amount, they shall undergo simple imprisonment for a period of 6 months.
The accused No.1 and accused No.2 are hereby are convicted for the offence punishable under Section 409 R/w.
Sec.120B of the IPC and sentenced to undergo rigorous imprisonment for a period of 7 years and to pay a fine amount of Rs.50,000/- each and in default of payment of fine amount, they shall undergo simple imprisonment for a period of one year.
The accused No.1 and accused No.2 are hereby convicted for the offence punishable under Section 477A R/w. Sec.120B of the IPC and they are sentenced to undergo rigorous imprisonment for a period of 5 years and to pay a fine amount of Rs.25,000/- each and in default of payment of fine amount, they shall undergo simple imprisonment for a period of 6 months.
The accused No.1 is hereby convicted for the offence punishable under Section 13(1)(c) & (d) R/w. Sec.13(2) of the PC Act and is sentenced to undergo rigorous imprisonment 118 Spl.CC.159/2018 for a period of 4 years and to pay a fine amount of Rs.10,000/- and in default of payment of fine amount, he shall undergo simple imprisonment for a period of 5 months.
The sentences ordered shall run concurrently and accused No.1 and 2 shall be entitled for set off as contemplated under Section 428 of the Cr.P.C., for the period of detention they have already undergone, if any.
Acting under Section 257 Cr.P.C., MO Nos.1 to 6 is ordered to be released in favour of the accused No.4 and MO.No.7 Rs.10 lakhs is ordered to be confiscated in favour of the State and MO No.8 Hard Disk with cable is ordered to be destroyed, as worthless after appeal period is over.
Office to supply the copy of the judgment to accused persons forthwith.
(Dictated to the Stenographer Gr.I directly on the computer, corrected and then pronounced by me in the Open Court on this the 29th day of August, 2024) (Shridhar Gopalakrishna Bhat) XXI Addl. City Civil and Sessions Judge, & Prl. Special Judge for CBI Cases, Bengaluru.
119 Spl.CC.159/2018 ANNEXURE LIST OF PROSECUTION WITNESSES EXAMINED ON BEHALF OF PROSECUTION:
PW.1 : Adinarayan. G PW.2 : K. Narayana Naik PW.3 : Abisekh Nagar PW.4 : Amardeep Kumar PW.5 : Kunal Gautam PW.6 : Smt. Jayashree K.S PW.7 : Naveen B.S PW.8 : Nandisha. A PW.9 : Maniah Kumar PW.10 : Akhil Pradha PW.11 : K. Md. Zakir Hussain PW.12 : Dr. Syed Hidyathulla PW.13 : B. Shivamurthy PW.14 : C. Shankar PW.15 : Dhanappa M.C PW.16 : G.B Shivaswamy PW.17 : Prabhakar P.R PW.18 : R. Rangnath PW.19 : Mahesh.S PW.20 : S. Rajashekharan PW.21 : Shivanshu Pathak PW.22 : Subrat Kumar Barik PW.23 : Swaroop R.S PW.24 : Smt. Shwetha Yadav PW.25 : Digambar Patel
PW.26 : Mahabaleshwar Sitaram Bhat PW.27 : S.A Senthil Kannan PW.28 : Sri. Dayanand Singh PW.29 : Rakesh Ranjan/I.O 120 Spl.CC.159/2018 PW.30 : V. Vivekananda Swamy PW.31 : S. Subramaniyan LIST OF DOCUMENTS MARKED AS EXHIBITS ON BEHALF OF PROSECUTION :
Exhibit Description No. Ex.P.1 Copy of the General Circular No.213/2016-17
dated 09.11.16 of SBM, HO, BLR (21 sheets) Ex.P.2 Copy of the General Circular No.217/2016-17 dated 11.11.2016 of SBM, HO, BLR (1 sheet) Ex.P.3 Copy of the General Circular No.219/2016-17 dated 11.12.2016 of SBM, HO, BLR (1 sheet) Ex.P.4 Copy of the General Circular No.221/2016-17 dated 13.11.2016 of SBM, HO, BLR (2 sheets) Ex.P.5 Copy of the General Circular No.223/2016-17 dated 14.11.2016 of SBM, HO, BLR (3 sheets) Ex.P.6 Production cum Receipt memo dated 30.03.2017 (1 sheet) Ex.P.6 (a) Signature of PW.1 Ex.P.6 (b) Signature of witness PW.29 Ex.P.7 Copy of Gazatte dated 22.02.2017 reg- Merger of Associate Banks with SBI (12 sheets) Ex.P.8 Copy of GBD Circular No. 26/2013-14 dated 23.08.2013 reg- currency Management- Dos and don'ts (two sheets) Ex.P.9 Production cum Receipt memo dated 07.04.2017 (1 sheet) Ex.P.9(a) Signature of PW.1 Ex.P.9(b) Signature of witness/ PW.29 Ex.P.10 Original Investigation report dtd 29.11.2014 of PW.1 to the CVO, Vig.Dept, H.O, SBM, BLR. (25 sheets).
Ex.P10(a) Signature of PW.1 121 Spl.CC.159/2018 Ex.P.11 Production cum Receipt memo dated 30.03.2017 (1 sheet) Ex.P11(a) Signature of PW.11 Ex.P11(b) Signature of witness / PW.29 Ex.P.12 Original audit report dated 22.12.2016 regarding demonetization of SBN-s at SBM Kollegal Branch (144 sheets).
Ex.P12(a) Signature of PW.2 at Page No.2 P.12(b) Relevant portion of Page No.3 at Sl.No. 2 to 6 P.12(c) Relevant portion of Page No.4 at Sl.No. 2 to 6 Ex.P.13 Production cum Receipt memo dated 30.03.2017 (1 sheet) P.13(a) Signature of PW.2 Ex.P. 13(b) Signature of Witness/PW.29 Ex.P.14 Check list showing daily report of exchange of SBN-s to the Controlling Office dated 10.11.2016 with enclosures P.14(a) Signature of PW.3 Ex.P.15 Check list showing daily report of exchange of SBN-s to the Controlling Office dated 10.11.2016 with enclosures (6 sheets) Signature of PW.3 Ex.P.16 Check list showing daily report of exchange of SBN-s to the Controlling Office dated 11.11.2016 with enclosures P.16(a) Signature of PW.3 Ex.P.17 Check list showing daily report of exchange of SBN-s to the Controlling Office dated 12.11.2016 with enclosures P.17(a) Signature of PW.3 122 Spl.CC.159/2018 Ex.P.18 Check list showing daily report of exchange of SBN-s to the Controlling Office dated 13.11.2016 with enclosures P.18(a) Signature of PW.3 Ex.P.19 Check list showing daily report of exchange of SBN-s to the Controlling Office dated 14.11.2016 with enclosures P.19(a) Signature of PW.3 Ex.P.20 Teller Wise Reports / Cash report - cfd -0903 for the day 10.11.2016 along with 65-B certificate.
Relevant Portion P.20(a) Relevant Portion P.20(b) Relevant Portion pertaining to Teller I.D.No. P.20(c) 6267181 Ex.P.21 Teller Wise Reports / Cash report - cfd -0903 for the day 11.11.2016 along with 65-B certificate.
P.21(a) Relevant Portion P.21(b) Relevant Portion P.21(c) Relevant Portion pertaining to Teller I.D.No. 6267181 Ex.P.22 Teller Wise Reports / Cash report - cfd -0903 for the day 12.11.2016 along with 65-B certificate.
Relevant Portion P.22(a) Relevant Portion P.22(b) Relevant Portion pertaining to Teller I.D.No. P.22(c) 6267181 Ex.P.23 Teller Wise Reports / Cash report - cfd -0903 for the day 13.11.2016 along with 65-B 123 Spl.CC.159/2018 certificate.
Relevant Portion P.23(a) Relevant Portion P.23(b) Relevant Portion pertaining to Teller I.D.No. P.23(c) 6267181 Ex.P.24 Teller Wise Reports / Cash report - cfd -0903 for the day 14.11.2016 along with 65-B certificate.
Relevant Portion P.24(a) Relevant Portion P.24(b) Relevant Portion pertaining to Teller I.D.No. P.24(c) 6267181 Ex.P.25 (Recovery Mahazar) Locker operation Proceedings dated 12.12.2016 ( 3 sheets) P.25(a) Signature of PW.6 Ex.P.25(b) Signature of the witness/PW.29 Ex.P.26 Locker operation Proceedings dated 12.12.2016 ( 2 sheets) P.26(a) Signature of PW.6 Ex.P.26(b) Signature of witness/ PW.29 Ex.P.27 Recovery Mahazar dated 07.12.2016 with Annexure-A (3 sheets) P.27(a) Signature of PW.7 P.27(b) Signature of PW.12 P.27(c) Signature of PW. 27 Ex.P.27(d) Signature of the witness/PW.29 Ex.P.27(e) Annexure-A with signatures of all the witnesses Ex.P.28 Photographs 24 in no's 124 Spl.CC.159/2018 P.28(a) to signatures of PW.7 P.28(x) Ex.P.29 Relevant portion of 161 statement of CW.13/PW.8 Ex.P.30 Production cum Receipt memo dated 30.06.2017, along with Annexure 1 to 5 (18 sheets) P.30(a) Signature of PW.9 Ex.P.30(b) Signature of witness / PW.29 Ex.P.31 Original vouchers pertaining to the date 10.11.2016 to 14.11.2016 (D.41 to 1395) Ex.P. 31(a) Credit Voucher dtd: 14.11.16 Ex.P. 31(b) Initial / Signature of PW. 13 Ex.P. 31(c) Credit Voucher dtd: 14.11.16 Ex.P. 31(d) Signature of PW. 14 Ex.P. 31(e) Credit Voucher for Rs. 1,03,500/-
Ex.P. 31(f) Signature of PW. 16 Ex.P. 31(g) Credit Voucher for Rs.30Lacs Ex.P. 31(h) Signature of PW. 18 Ex.P. 31(j) Credit Voucher for Rs. 5 Lacs Ex.P.32 Original cheques pertaining to the date 10.11.2016 to 14.11.2016 (D.1407 to 1501) P. 32(a) Cheque dated : 10-11-2016 for Rs. 10 Lakhs P. 32(a-1) Signature of PW. 15 P. 32(b) Cheque dated : 10-11-2016 for Rs. 50 Lakhs P. 32(b-1) Signature of PW. 17 125 Spl.CC.159/2018 P. 32(c) Cheque dated : 10-11-2016 for Rs. 20 Lakhs P. 32(d) Cheque dated : 10-11-2016 for Rs. 5 Lakhs P. 32(e) Cheque dated : 10-11-2016 for Rs. 10 Lakhs Ex.P.32(f) Cheque Ex.P.32 Signature of Mrinal Pradeep (f-1) Ex.P.33 Certified copy of Cash denominations Report for the date 10.11.2016 along with 65 -B Certificate (9 sheets) Ex.P.34 Certified copy of Cash denominations Report for the date 11.11.2016 along with 65 -B Certificate (9 sheets) Ex.P.35 Certified copy of Cash denominations Report for the date 12.11.2016 along with 65 -B Certificate (9 sheets) Ex.P.36 Certified copy of Cash denominations Report for the date 13.11.2016 along with 65 -B Certificate (10 sheets) Ex.P.37 Certified copy of Cash denominations Report for the date 14.11.2016 along with 65 -B Certificate (10 sheets) Ex.P.38 Attested copy of extract of Vault Register for the date 20.10.2016 maintained by SBM, Kollegal Branch for Rs.66, 20,00,000/-
Ex.P.39 Attested copy of extract of Vault Register for the date 25.02.2016 maintained by SBM, Kollegal Branch for Rs.63,50,00,000/-.
Ex.P.40 Production cum receipt memo dated 09.10.2017 Ex.P.40(a) Signature of PW.10 Ex.P.40(b) Signature of witness/ PW.29 Ex.P.41 Certified extract of Currency Chest book (Form-
TE1) Page 49 to 52 126 Spl.CC.159/2018 P. 41(a) True copy of Ex.P. 41 Ex.P.42 Certified extract of Vault Register from 02.11.2016 to 16.11.2016 Ex.P.43 Certified extract of Cash Balance Register from 02.11.2016 to 16.11.2016 Ex.P.44 Certified copy of teller receipt / Payment Cash register relating to teller ID No.6173365 for the day 11.11.2016 with 65-B Certificate Ex.P.45 Certified copy of teller receipt / Payment Cash register relating to teller ID No.6173365 for the day 11.11.2016 with 65-B Certificate Ex.P.46 Certified copy of teller receipt / Payment Cash register relating to teller ID No.6173365 for the day 11.11.2016 with 65-B Certificate Ex.P.47 Certified copy of teller receipt / Payment Cash register relating to teller ID No.62677335 for the day 11.11.2016 with 65-B Certificate Ex.P.48 Certified copy of teller receipt / Payment Cash register relating to teller ID No.6272428 for the day 11.11.2016 with 65-B Certificate Ex.P.49 Certified copy of teller receipt / Payment Cash register relating to teller ID No.6267181 for the day 11.11.2016 with 65-B Certificate Ex.P.50 Certified copy of teller receipt / Payment Cash register relating to teller ID No.6256740 for the day 11.11.2016 with 65-B Certificate Ex.P.51 Sheet containing details of employee names, employee number and individual teller ID Ex.P.52 Covering letter dated 09.10.2017 of SBM, Kollegala Branch to CBI Ex.P.52(a) Signature of PW.10 Ex.P.53 One bunch of Inter Branch Transfer vouchers (IBTS) for the period 10.11.2016 to 14.11.2016 (D.1515 to 1575 ) P.53(a) Deposit Voucher dtd: 14-11-2016 P.53(a-1) Signature of PW. 20 Ex.P.54 Attested copy of officer order dated 01.01.2015 127 Spl.CC.159/2018 available at page No.24 of Bank transfer scroll Ex.P. 55 Copies of Letter dtd: 19-11-2016, 23-11-2016 and 26-11-2016 (produced by PW. 11) Ex.P. 56 CC of Extract of vault Register for the date 10.11.2016 (2 sheets) P. 56(a) Relevant Entry Ex.P. 57 Receipt Memo dated: 09-10-2017 P. 57(a) Signature of PW. 21 Ex.P. 57(b) Signature of witness/ PW.29 Ex.P. 58 Receipt Memo dated: 17-10-2017 P. 58(a) Signature of PW. 24 Ex.P.58(b) Signature of witness/ PW.29 Ex.P. 59 A sheet containing Service Particulars of A-3 Ex.P. 60 Circular No. DCM-(PLG) No. 1226/10.27.00/2016-17 dated : 08-11-2016 of RBI Ex.P. 61 Fresh Notes Remittance Order dated : 21-10- 2013 Ex.P. 62 copy of Remittance Invoice dated : 22-02-2016 for SBM, Kollegal with total value of Rs. 63.50 Crores Ex.P. 63 copy of Remittance Invoice dated : 21-10-2013 for SBM, Sandur with total value of Rs. 67.7 Crores Ex.P. 64 copy of Remittance Invoice dated : 21-10-2013 for SBH, Yelburga Ex.P. 65 Fresh Notes Remittance Order dated : 12-02- 2016 for SBM, Kollegal Ex.P. 66 Fresh Notes Remittance Order dated : 06-10- 2016 for SBM, Kollegal Ex.P. 67 copy of detail of instruction dated : 14-10-2016 given to Accused No. 3 Sri. K. Michael Ex.P. 68 Order dated : 13-10-2016 of deputing Accused No. 3 Sri. K. Michael for dispatching to SBM, 128 Spl.CC.159/2018 Kollegal on 20-10-2016 by road with due date on 14-11-2016 Ex.P. 69 Letter dated : 15-12-2016 issued by Smt. Renu Sahara, AGM providing details of series of currency notes mentioning the denomination of Currency notes issued to SBM, Kollegal Branch on 20-10-2016 Ex.P. 70 Letter dated : 17-10-2017 deputing me to attend CBI Office and hand over document by Sri. Lakshmi Pathy, DGM Ex.P. 71 Original Sanction Order dated: 02.01.2018 Ex.P. 71(a) Signature of PW - 26 Ex.P. 72 Forwarding Letter dated : 04.01.2018 of DGM, Vigilance Ex.P. 73 Opened sealed cover in which M.O. 8 was kept P. 73(a) Signature of PW. 27 Ex.P.74 Debit Voucher dtd 10.11-2016 for Rs.
22,00,000/- prepared by Rajendra K.M Ex.P.75 Production memo Ex.P.75 (a) Signature of the witness/PW.28 Ex.P.75(b) Signature of witness/ PW.29 Ex.P.76 Search list Ex.P.76 (a) Signature of the witness/PW.29 Ex.P.77 Inventory document Ex.P.77(a) Signature of the witness/PW.29 Ex.P.78 Currency chest slip along with U/s 65-b certificate Ex.P.79 Authorization issued to witness Us 165 of Cr.P.C Ex.P.80 Search List Ex.P.80(a) Signature of the witness/PW.30 Ex.P.81 Authorization issued by HOB Ex.P.82 Search list drawn by witness/PW.31 129 Spl.CC.159/2018 Ex.P.82(a) Signature of the witness/PW.31 Ex.P.83 Inventory Ex.P.83 Signature of the witness/PW.31 Ex.P.84 Letter along with the copies of Challans (total 101 pages) Ex.P.85 Entire Original vouchers provided by the Department of Post, Kollegal (6 pages) Ex.P.86 Letter dated 23.01.2017 sent by RBI Ex.P.87 Request letter by zonal office to conduct detailed investigation Ex.P.88 The teller certificate Ex.P.89 U/s 65-B certificate Ex.P.90 Service particulars of accused No.1 Ex.P.91 FIR in RC No.25(A) of 2016 dtd.6.12.2016 LIST OF EXHIBITS MARKED ON BEHALF OF DEFENCE Exhibit Description Number Ex.D.1 Relevant portion of 161 statement of CW.2/PW.2 to D.3 Ex.D.4 Relevant portion of 161statement of PW.11 LIST OF MATERIAL OBJECTS MARKED ON BEHALF OF PROSECUTION:
Exhibit Description Number MO.1 A Bundle of new currency notes having
denomination of Rs.100 X 1000 numbers having Sl.No.2WW 144001 to 145000 MO.2 A Bundle of new currency notes having denomination of Rs.100 X 1000 numbers having Sl.No.2WW 154001 to 155000 MO.3 A Bundle of new currency notes having denomination of Rs.100 X 1000 numbers having Sl.No.7AW 110001 to 111000 130 Spl.CC.159/2018 MO.4 A Bundle of new currency notes having denomination of Rs.100 X 1000 numbers having Sl.No.3BK 546001 to 547000 MO.5 A Bundle of new currency notes having denomination of Rs.100 X 1000 numbers having Sl.No.7AW 169001 to 170000 MO.6 A Bundle of new currency notes having denomination of Rs.100 X 1000 numbers having Sl.No.2WW 164001 to 165000 MO.7 10 Bundles of new currency notes having denomination of Rs.100 X 1000 numbers in each bundles (Note sl.no as per Annexure -A of Ex.P.27) MO.8 Hard Disk with cable (Shridhar Gopalakrishna Bhat) XXI Addl. City Civil and Sessions Judge, & Prl. Special Judge for CBI Cases, Bengaluru.
SHRIDHAR G BHAT Digitally signed by SHRIDHAR G BHAT Date: 2024.08.29 17:00:09 +0530