Bangalore District Court
Wilson Garden Police Station vs Manjunatha G.A on 17 July, 2025
KABC030355132024
Presented on : 27-06-2024
Registered on : 27-06-2024
Decided on : 17-07-2025
Duration : 1 years, 0 months, 20 days
IN THE COURT OF THE XLII ADL.CJM, BENGALURU.
Present: Shri.K.N.SHIVAKUMAR, B.Sc.,(Agri),L.L.M.,
Sr.Civil Judge & JMFC
DATED THIS THE 17th DAY OF JULY, 2025
C.C.No. 20267/2024
COMPLAINANT: State by Wilson Garden Police Station,
Bengaluru.
(By learned Sr.A.P.P.)
-Vs-
ACCUSED: 1. MANJUNATHA G.A
S/o Late Ankappa
Aged about 58 Years
No.116, 2nd Main,
Vittal Nagar, Isro Layout,
Bengaluru.
2. RAJANNA
S/o. Late. Narayanappa
Aged about 56 Years
2 C.C.No. 20267/2024
No.26, Lalbagh,
Siddapura, J.C. Colony,
Jayanagar 1st Block,
Bengaluru.
3. PURUSHOTHAM
S/o. Chikkanna
Aged about 52 Years
Dodda Aladahalli Village & Hobli,
Kanakapura Taluk,
Ramanagara District.
4. V K PUTTASWAMY
S/o. Late Kenchegowda
Aged about 64 Years
Ayerahalli,
Dandinashivara Hobli,
Turuvekere Taluk,
Tumakuru District
5. SHIVANNA
S/o. Nanjappa
Aged about 60 Years
No.23, 6th Cross, 6th Main,
Shivananda Nagar,
Hegganahalli,
Vishwaneedam Post,
Bengaluru City.
6. ARUN KUMAR
S/o. Lakshminarasimaiah
Aged about 41 Years
No.68/1, 4th Cross,
Kaveri Layout,
Bengaluru City
3 C.C.No. 20267/2024
7. M C LINGARAJU
S/o. Late. M. Chikkegowda
Aged about 63 Years
No.96, 1st Main Road,
7th Cross, Kengeri,
Bengaluru.
8. ASHWATH NARAYANA
S/o. Late. Venkatachala
Aged about 58 Years
No.7, K.S.R.T.C Layout,
Dr. Vishnuvardhan Road,
Near Viveka Polyclinic
Chikkallasandra,
Bengaluru City,
9. A.S. ONTI
S/o. Siddaramappa
Aged about 58 Years
A.E.C.S. Layout,
1st Block, Singasandra,
Bengaluru City
10. H S MALLIKARJUNAIAH
S/o. Late. H.S. Veeraiah
Aged about 65 Years
R/o. No.18, 2nd Cross,
4th Main,
B.H.E.L Pattanagere North,
Bengaluru.
11. D. DEVARAJU
S/o. Late. A DaseGowda
Aged about 66 Years
No.1790/34, 7th Main Road,
4 C.C.No. 20267/2024
E Block,
2nd Zone, Rajajinagar,
Bengaluru
12. S S NAGARATHNAMMA
W/o. Rayappa Gowda
Aged about 59 Years
R/o. No.606,
4th Cross, 3rd Main,
Gavipuram Layout,
Ullal Main Road,
Bengaluru
13. E KRISHNAPPA
S/o. Late. Erappa
Aged about 60 Years
Adakamaranahalli,
Makali Post,
Tumakuru Road,
Bengaluru
14. LAKSHMINARAYANAGOWDA
S/o. Late Ankappa
Aged about 62 Years
President State Farmers' Association
Karishma Hill,
80 Ft Road, Gubbal,
Kanakapura Road,
Bengaluru City
15. SURENDRA
S/o. Late. Venkatappa
Aged about 57 Years
No.753, 47th Cross, 8th Block,
Jayanagar,
Bengaluru City
5 C.C.No. 20267/2024
16. CHANDRASHEKARAGOWDA
S/o. Late. Ajjala Byregowda
Aged about 55 Years
No.22, Bylanjaneya Swamy Nilaya,
Bhairaveshwara Layout,
Vajarahalli Road,
Nelamangala,
BENGALURU.
(Accused No.1 to 6, 8 & 9, 12 to 16
Represented by Sri. DML Advocate).
(Accused No.7, 10 & 11 Represented by
Sri. CCN Advocate).
JUDGMENT
This case arose out of the Crime No.24/2018 of Wilson garden Police Station, Bengaluru for the Offences P/U/S.408, 420 R/w 34 of IPC. After the investigation the P.S.I, of said Police Station has submitted the Charge-sheet/final report.
2. The case of the prosecution in brief is as follows; The accused No.1 to 12 who were the directors of KSRTC Employees House Building Co-operative society ( hereinafter referred as 'The Society') from 2010 to 2016 along with accused No.13 to 16 who were the partners of 6 C.C.No. 20267/2024 M/s. Supreme Associates- a developer firm with which said society had entered into a joint venture agreement in collaboration with Karnataka Housing Board ( in short 'KHB' for reference ) to form a residential layout at Nelanamgala for its members in the name of " Sarige Nagara", have misused their powers in the said society and misappropriated the funds of the society to the tune of Rs. 14,73,10,000/-. The accused have transferred Rs.12,10,00,000/- on various dates from 01/04/2010 to 30/06/2012. Similarly, they have transferred a sum of Rs.1,70,00,000/- on various dates from 01/12/2012 to 31/03/2015 & Rs.93,10,000/- on various dates from 01/04/2015 to 14/09/2016 to the Developers i.e., accused No.13 to 16, directly from the account of society in violation of the conditions of Tri-Parte Agreement that was entered between the KHB, KSRTC Employees House Building Co-operative society and Developer firm i.e., M/s. Supreme Associates on 05/02/2011. Further the said amounts were released to the developer without 7 C.C.No. 20267/2024 verifying and examining the status of developments that were done by the developer in the said project of developing a residential layout in an extent of 110 acres at Kannegowdana Halli, Narayanrao Palya Villages of Nelamangala Taluk, Bengaluru Rural District, as per the Tri-Parte Agreement. Further as per the said agreement the developer firm has to procure lands in the said area and convey the same to KHB. Out of said 110 acres, an extent of 5 acres 12 guntas of land mentioned in the schedule to Tri-parte agreement was purchased and registered by the developer in the name of accused No.15 and his friend instead of registering in the name of KHB on behalf of society. Further during 2015-2016 the accused No.6 being president of said society has illegally paid Rs.54,00,000/- to one Mrs.Usha Enterprises in violation of by-laws of the society and also withdrew and utilized Rs. 18,00,000/- in his personal name from the account of said society. As per the said tri-parte agreement, the funds towards the development of said 8 C.C.No. 20267/2024 project have to be released stage by stage after completion of each stage of development as mentioned in the said agreement. More so, as per the said agreement said funds shall be released or paid to the developer through an ESCROW Account to be opened by said society and KHB jointly. But the accused No.1 to 12, while they were the directors of said society, transferred the above stated funds to the developer i.e., accused No.13 to 16, directly from the account of the society. Further the accused without the knowledge and consent of KHB and in violation of said tripartite agreement changed the partner of developer firm & substituted by accused No.14 who is none other than the brother of accused No.1, in order to misappropriate the funds. As such the accused No.1 to 12 in collusion with the accused No.14 and his developer firm, illegally transferred such huge sum of money in violation of tri-parte agreement with their common intention of misusing & misappropriating the funds of the society. As such the accused have cheated 9 C.C.No. 20267/2024 the society and its members who are the aspirants of residential sites in the said project, who have deposited alleged funds with the society, which was in the custody of the accused No.1 to 12. Accordingly, the accused have committed the Offences P/U/S. 408, 420 R/w 34 of IPC.
3. After taking cognizance of alleged Offences on the basis of Charge-sheet materials, summons were issued to the accused. On receipt of summons, the accused have entered appearance before the Court and enlarged on bail. The relevant copies of charge sheet were furnished to them in compliance with Sec.207 of Cr.P.C. The charges were framed for the Offences P/U/s. 408, 420 R/w 34 of IPC against the accused & the same were read over & explained to them. The accused pleaded not guilty and claimed to be tried. Hence, the case was posted for trial against accused.
4. In the instant case, the prosecution side has examined 49 witnesses as PW.1 to 49 and got marked 10 C.C.No. 20267/2024 documents at Ex.P1 to 76. During cross-examination of prosecution witnesses, the accused got produced & marked the documents at Ex.D1 to 41 on confrontation. Thereafter, the accused were examined U/Sec.313 of Cr.P.C., to enable them to explain the incriminating circumstances appeared against them in the evidence of prosecution. They have denied the same and did not choose to lead defence evidence.
5. Heard the arguments of the learned Senior Assistant Public Prosecutor and learned advocates for the accused and perused the materials available on record.
6. The points that arise for consideration are:
1. Whether the prosecution proves beyond all reasonable doubts that, the accused No.1 to 12 being the directors of KSRTC Employees House Building Co-operative Society & accused No.13 to 16 being the partners of developer firm-M/s.
Supreme Associates, having been entrusted with the funds of said society have committed criminal breach of trust by dishonestly misappropriating Rs. 14.73 crores out of the 11 C.C.No. 20267/2024 funds of said society from 2010 to 2016 and thereby committed an offence punishable U/sec.408 R/w. Sec.34 of Indian Penal Code ?
2. Whether the prosecution further proves beyond all reasonable doubts that, during the said period, the accused have cheated the members of said society, who made deposit of money towards sites, by dishonestly inducing them to make such deposits, whose interest they were bound to protect under the agreement, with the knowledge that thereby they were likely to cause wrongful loss to those members and thereby committed an offence punishable U/sec.420 R/w. Sec.34 of Indian Penal Code ?
3. What Order ?
7. My answer to the above points are as follows :
Point Nos.1 & 2 : In the Negative Point No. 3 : As per final order for the following;
REASONS
8. Point Nos.1 & 2 :- As these two points are inter-linked, they are taken together for common discussion in order to avoid repetition of facts and evidences.
12 C.C.No. 20267/2024
9. The prosecution has alleged that the accused have committed the offences P/U/S.408, 420 R/w 34 of IPC. To prove the case of the prosecution, it is necessary to prove that, the accused have a common intention to misappropriate the funds of the KSRTC Employees House Building Co-operative society and to cheat the members of said society who have paid their contributions towards the Residential sites assured to be formed in the said 'Sarige nagar' Layout at Nelamangala by the said society and in furtherance of said common intention the accused have dishonestly misappropriated the funds collected from the members towards formation of said layout, which was entrusted with them as the Board of Directors of said society and not formed said layout and allotted any sites to the members who have contributed for the said project and thereby the accused have committed criminal breach of trust and cheated the members of said society.
13 C.C.No. 20267/2024
10. In order to prove the case of the prosecution, the prosecution has examined 49 witnesses as PW1 to
49. Among them PW.1 is the complainant or first informant, PW.2 to 15 & PW29 to 49 are stated to be the Members of said society who stated to had made deposits towards sites in the said 'Sarige nagar' Layout from 2006 to 2016, PW16 to 18 & PW23 are stated to be the Directors / Presidents / Vice presidents / Secretary of said society at different periods from 2005 to 2010 & 2015 to 2020, PW19 & 20 are stated to be the panch witnesses to the spot-mahazar conducted in the said society by the investigating Officer ( 'the I.O' in short ), PW21 is stated to be an Employee of said society who stated to had furnished the documents and Bank statements relating to payments made by the society to the Developer from 2010 to 2012, 2012 to 2015 & 2015 to 2016 as per Ex.P19, 20, 37 & 38 to 40. PW22 is stated to be the Assistant Executive Engineer ( AEE ) working in the Karnataka Housing Board ( KHB ), who stated to had 14 C.C.No. 20267/2024 furnished the details of lands purchased and registered in the name of KHB on behalf of said society to the complainant - PW1 as per Ex.P18, PW24 is the Auditor of said society for the period 2016-17, 2017-18, 2019-20 & 2020-21, PW25 is the then PSI of Wilson-garden Police station who stated to had received the complaint - Ex.P1 from PW1 & registered the FIR as per Ex.P54 and conducted the spot mahazar as per Ex.P2 in the said society on 06/02/2018. PW26 is the then PSI Wilson- garden Police station who did further investigation in this case by recording the voluntary statements of accused No.4, 5, 6, 8 & 9 as per Ex.P54 to 58, PW27 is stated to be the then Deputy Registrar of Co-operative societies, Bengaluru who stated to had conducted an enquiry U/sec. 64 of The Co-operative Societies Act,1959 in relation to the allegations of illegalities in the said society, PW28 is the then PSI of Wilson-garden Police 15 C.C.No. 20267/2024 station who did further investigation of this case and submitted the charge-sheet.
11. In the course of evidence of PW1, the prosecution got marked the complaint lodged before the Wilson-garden police as Ex.P1, the spot mahazar conducted by the I.O in the office of said society as Ex.P2, the copy of Bye-law of said society as Ex.P3, copies of extract of Board Resolutions of said society from 01/04/2004 to 30/11/2016 as per Ex.P4 & 5, the enquiry report U/sec. 64B of the Co-operative Societies Act, as per Ex.P6, the order of Additional Register of Co- operative societies U/sec. 68(1) of the Co-operative societies Act as per Ex.P7, Copy of Tri-parte agreement between said society, KHB & the Developer - M/s. Supreme Associates as per Ex.P8, the copy of Audit report for the Financial year 2019-20 as per Ex.P9, the Resignation letters of accused No.6, accused No.3 & accused No.5 as per Ex.P10 to 12 respectively, the 16 C.C.No. 20267/2024 statement of account for the period 2006 to 2017 of the current account of said society in Vijaya Bank, Shanthinagar Branch as per Ex.P13, the letter along with documents relating to the lands purchased by KHB on behalf of the society as per Ex.P18, the letter containing the details of amount paid to M/s. Supreme Associates from the said society from 2010 to 2012 as per Ex.P19, the letter containing the details of amount paid to M/s. Supreme Associate from the said society from 2015 to 2016 as per Ex.P20, the letter given to I.O by PW1 regarding liability of the Board of Directors of said society, the Developer & its Partners in the alleged illegality as per Ex.P21, the details of amounts paid to M/s. Usha Enterprises from 2015 to 2016 from the said society as per Ex.P22 and the RTCs relating to the lands purchased in the name of Developer - Surendra and his friend - Kumar out of the fund of the society as per Ex.P23 to 25.
17 C.C.No. 20267/2024
12. Further, in the course of evidence of PW23, the prosecution got produced the copies of Board Resolutions from 23/04/2011 to 24/05/2014 as per Ex.P41 & 42, the copy of estimation of works done in the said layout as per Ex.P43, copies of 4 sale deeds in respect of the lands purchased by the Developers - Surendra and his friend T.S. Kumar as per Ex.P44 to 47, the Mutation extracts in respect of said lands as per Ex.P48 to 51, the Encumbrance certificate in respect of said lands as per Ex.P52 & the complaints given by 6 Directors of said society to the Co-operative Department, President of society, KHB, Co-operative Minister, Chief Secretary, Principal Secretary of Co-operative Department, the Governor & the Registrar of Co-operative societies as per Ex.P53.
13. In the course of cross-examination of PW1, the defence counsel on confrontation got produced the draft Tri-parte agreement approved by the Principal Secretary 18 C.C.No. 20267/2024 Housing Department as per Ex.D1, the approved layout plan of said 'Sarige nagar' layout as per Ex.D2, the extract of Emergency Board meeting dated: 22/01/2007 of said society as per Ex.D3, the Note given by the Financial Controller, KHB to the Chief Engineer, KHB about not having any documents as to ESCROW agreement between the said society & KHB, as per Ex.D4, the show cause notice dated: 25/04/2015 issued by the KHB to the President of said society as per Ex.D5, the Request letter given by the Assistant Executive Engineer, KHB to the Nelamangala Planning Authority for approval of change of land use in respect of the lands for said housing scheme of the society as per Ex.D6, the letter of request made by the Commissioner, KHB to Commissioner, BMRDA for issuance of NOC for formation of said layout as per Ex.D7, the letter seeking permission from KHB for obtaining legal opinion & registration of 1 Acre 5 guntas of land purchased by M/s. Supreme Associate for the said layout as per Ex.D8, the letter from 19 C.C.No. 20267/2024 the Principal Secretary Housing Department to the Commissioner, KHB about approval of draft Tri-parte agreement as per Ex.D9, the order of approval of seniority list for 485 sites in the said layout by the Registrar of Co-operative societies as per Ex.D10, the report of spot inspection submitted by the Executive Engineer, KHB, Bengaluru Rural office to the Commissioner, KHB as to the Developmental works done in the said layout as per Ex.D11, the order as to approval of layout plan by the Nelamangala Planning authority as per Ex.D12, the copy of stay order for the order passed by Additional Registrar of Co-operative Societies U/sec. 68 of said Act, as per Ex.D13, the copy of legal notice issued by PW1 to the Secretary,BMRDA during 2013 objecting for approval of layout plan as per Ex.D14, the receipt as to registration of M/s Supreme Associates as per Ex.D15, the Sale agreement between the society and said Supreme Associates dated: 21/05/2007 as per Ex.D16, the intimation letters issued by said M/s. Supreme 20 C.C.No. 20267/2024 Associates regarding change of its partners during 2007 to the society & KHB as per Ex.D17 & 18 respectively, the re-statement given by PW1 to the I.O of this case as per Ex.D19, the letter along with copy of demand draft (DD) for Rs.70,85,826/- paid to Nelamangala Planing Authority by the AEE, KHB as per Ex.D20, the Notice issued to M/s. Supreme Associates seeking information about part payment of the conversion charges by the society as per Ex.D21, the Letter issued to the Pollution Control Board by AEE, KHB as per Ex.D22, the report submitted by KHB as to completion of 80% work in the said layout as per Ex.D23.
14. In the course of cross-examination of PW18, the defence counsel confronted and produced the letter given by the society to the Commissioner, KHB regarding decision to open joint account in Vijaya Bank, K.H. Road, Shanthinagar as per Ex.D24. The copy of Board Resolution dated: 08/03/2008 approving to pay 5% i.e., 21 C.C.No. 20267/2024 Rs.2.25 Crores to the Developer as per Ex.D25, the board resolution dated: 24/07/2009 as per Ex.D26, the Board Resolution dated: 08/09/2008 approving to give legal notice to the developer as per Ex.D27, the Board Resolution dated: 29/06/2009 regarding the demand of Developer to increase the site value from Rs.355 to 500 and agreeing to develop the remaining 40 Acres after January - 2009 as per Ex.D28.
15. In the course of cross-examination of PW23, the defence counsel confronted and produced the Minutes of Meeting dated: 29/11/2006 of said society as per Ex.D29, the letter issued by the Managing Partner of M/s. Supreme Associates - Sri. Lakshminarayana Gowda as per Ex.D30, the copy of monthly meeting dated:
02/03/2011 of Board of said society as per Ex.D31, the Board Resolution dated: 04/09/2010 resolving to discuss and decide with the KHB regarding Modification in the Tri-parte agreement as per Ex.D32, copy of 22 C.C.No. 20267/2024 Resolution of the General Body Meeting dated:
25/09/2013 as per Ex.D33, the letter dated: 30/11/2010 issued to the Commissioner, KHB about payment of Rs.
5.9 Crores to the Developer as per Ex.D34, the letter dated: 21/09/2018 issued by M/s. Supreme Associates to said society as per Ex.D35, the letter dated:
03/09/2018 written by PW23 as President of said Society to M/s. Supreme Associates as per Ex.D36, the letter dated: 20/03/2008 written by PW23 to the Commissioner, KHB as per Ex.D37, the letter dated:
15/11/2017 issued to the joint registrar of co-operative societies by the Secretary of said Society - T.M. Mohan stating that no complaints as to misuse of funds of society were received from any member of the society and the delay in formation of layout was due to the fresh notifications of the Government from time to time, as per Ex.D38, the copy of Monthly Board meeting dated:
29/04/2007 as per Ex.D39, the copy of Minutes of Meeting dated: 23/09/2016 appointing the auditor as 23 C.C.No. 20267/2024 per Ex.D40, the letter written by the Commissioner, KHB to Executive Engineer, KHB to obtain concent of the society for calling fresh Tender for completion of remaining Development works in the said layout as per Ex.D41.
16. Let us examine as to whether the testimony of PW1 to 49 and the documentary evidences as stated herein above would prove the guilt of the accused beyond reasonable doubts. It is the specific allegation in the charge-sheet that, from 01/04/2010 to 30/06/2012 the accused No.3, 4 & 5 have misappropriated Rs.12.10 Crores by violating the conditions of Tri-parte agreement and releasing said amount in favour of the Developer - M/s. Supreme Associates without any developmental works in the layout, from 01/12/2012 to 30/01/2015 the accused No.3, 4 & 5 have misappropriated Rs.1.70 Crores by violating the conditions of Tri-parte agreement and releasing said amount in favour of the Developer - 24 C.C.No. 20267/2024 M/s. Supreme Associates without any developmental works in the layout and from 01/04/2015 to 14/09/2016 the accused No.3, 5 & 6 have misappropriated Rs.93.10 Lakhs by violating the conditions of Tri-parte agreement and releasing said amount in favour of the Developer - M/s. Supreme Associates without any developmental works in the layout. As such, the accused being the Directors cum the President, Vice President & Secretary of KSRTC Employees House Building Co-operative society during the said periods have misappropriated in total an amount of Rs.14.7310 Crores.
17. Further, the accused No.15 being the Managing Partner of said M/s. Supreme Associates got registered about 5.12 Acre of land belong to 110 Acres earmarked for the said housing project, in his personal name and in the name of his friend instead of registering the same in the name of KHB as per the Tri-parte agreement during 25 C.C.No. 20267/2024 2010 to 2015 and thereby caused wrongful loss to said society. Further, accused No.6 has released an amount of Rs.54 Lakhs directly in favour of M/s. Usha Enterprises illegally in violation of agreement during 2015 & 2016 without any developmental works and also he has self drawn Rs.18 Lakhs from the account of said society without the approval from the Board of Directors and thereby he has misappropriated the funds of the society and cheated the society. It is further alleged that, the accused No. 1 to 12 being the Directors & the Members of Board of Directors of said society and accused No.13 to 16 being the partners of Developer - M/s. Supreme Associates from 2010 to 2016 have entered into a conspiracy to cause wrongful loss to the said society and make wrongful gain for themselves, entered into a Tri-parte agreement with the Karnataka Housing Board. During 2010-2012 the accused with their dishonest intention brought accused No.14 who is none other than the Brother of accused No.1 as a 26 C.C.No. 20267/2024 partner of said M/s. Supreme Associates without the knowledge of KHB and released alleged funds directly instead of through an ESCROW account, in violation of the Tri-parte agreement. Thus, from the charge-sheet allegations it appears that, there are several acts of alleged fraud committed by the accused.
18. The complainant - PW1 is stated to be one of the members of said society who also served the society as President of said society during 2020 to 2022. He has lodged the complaint in this case as per Ex.P1, when he came to know about the alleged illegalities in the said society during the Annual General Body meeting 2016-
17. In his evidence he has stated that, during the period of accused No.1 from 2009 to 2011 there was misappropriation of Rs.12.10 Crores, during the period of accused No.4 there was misappropriation of Rs.2.63 Crores and during the period of accused No.6 there was misappropriation of Rs.1.70 Crores out of the funds of 27 C.C.No. 20267/2024 said society collected from the members towards alleged Housing project. He has reiterated the allegations of his complaint and produced the documents in support of said allegations as already discussed herein above. In his complaint at Ex.P1, he has alleged that there was such illegality and misappropriation during the period 2007-08 to 2015-16 including the period of PW16 - Ramaiah, PW18 - Hemaraju & PW23 - Vishveshwaraiah. But, in the charge-sheet said PW16, 18 & 23 were dropped as the accused and the I.O has stated that as per the further statements & documents produced by PW1, as no offence is made out against them & during their period, they were dropped from the charge-sheet.
19. On considering the allegations of complaint, evidence of PW1, PW16, PW18, PW23 & the charge-sheet, the following major allegations as to commission of alleged misappropriation can be culled out; 28 C.C.No. 20267/2024
1. Brach of conditions of Tri-parte agreement;
(i) Direct payment to Developer excluding the ESCROW account.
(ii) Substitution of accused No.14 - the Brother of accused No.1 as partner of Developer company - M/s. Supreme Associates without knowledge of KHB.
2. Purchase of lands in the personal names of Developer -Mr. Surendra - accused No.15 and his friend which are the scheduled lands under Tri-parte agreement.
3. Payments made to M/s. Usha Enterprises by accused No.6 and self drawing of funds from the account of the society.
4. Payment of Goodwill from the funds of the society to the out going partners of Developer firm.
20. On careful scrutiny of the evidence lead by the prosecution, it appears that the Pw2 to 15 & Pw29 to 49 are the employees of KSRTC & BMTC and members of said KSRTC employees' House Building Co-operative Society. All these witnesses in their testimony categorically deposed that they became members of said 29 C.C.No. 20267/2024 society during different periods and deposited money with the society towards sites of different dimensions during different periods from 2006 to 2019. All these witnesses deposed that they came know about alleged illegalities & misappropriation of funds in the society, during the Annual General Body meeting of said Society for the period 2016-17, wherein the then president of said society Sri. Vishveshwaraiah i.e PW23 had informed about the same. Except that these witnesses have not stated any details as how alleged misappropriation was done, who all involved in the same. In their cross examination also Ld. APP could not elicit any such information as to whether any of these witnesses had direct knowledge about alleged illegalities. On considering the testimony of these witnesses, it appears very clear that except they being members of said society & making deposit of some amounts in the said society towards allotment of sites in said project, they don't have any knowledge about alleged tri-parte agreement, conditions 30 C.C.No. 20267/2024 of said agreement, how funds were used by the board of directors, etc. As such it is evident that all these witnesses are merely the hearsay witnesses. Therefore, the substantive evidence that is available for the prosecution to prove its case is the testimony of Pw1, 16 to 19, 23 to 28. All these witnesses have deposed in support of the prosecution in their testimony.
21. Ld. Sr APP has argued that the basic principle governing the criminal justice administration i.e., "Hundred culprits may escape, but one innocent shall not be punished" is not applicable to this case, because the offences alleged in this case are P/U/Sec.408 & 420 of IPC, which can be proved by the evidence of complainant & corroborated by evidence of other independent witnesses. He also submitted in his written argument that as held by Hon'ble Apex Court in a case reported in 2009 (2) Crimes 152 (SC), ' A presiding Judge is duty 31 C.C.No. 20267/2024 bound not only to see that no innocent is punished, but guilty doesn't go unpunished.'
22. On the other hand Ld defence counsel for accused have argued that the I.O of this case has not done fair & proper investigation in this case. He has acted on what is stated by the defacto- complainant & what is produced by him. He barely relied on what is observed in the enquiry Report of Dy. Registrar of co- operative Societies U/Sec.64 of the Co-operative Societies Act & filed the charge sheet as if a postman. Without proper enquiry he has dropped Pw16, 18 & 23 from the Charge sheet only on the say of Pw1. Further there are no materials to show that the society had entered into any such Escrow Agreement & opened any such Escrow Account as per the terms of draft Tri-parte agreement either earlier to 2010 or subsequently during the period of these accused No.1 to 12. That being the case, it cannot be said that payment made by the society during 32 C.C.No. 20267/2024 the period of only these accused was illegal & violation. More over, admittedly all the payments made during their period were made through cheuqes from the account of society and there are no iota of evidence to show that a single rupee was being personally used by any of these accused. Further there are no materials to show that no developmental works were done in the said layout during the period of these accused. Rather the report of the Executive engineer of KHB, reply given by Pw23 during his tenure to the quiry of one Mr. Puttaswamy and also the order of Dy Registrar of Co-operative Societies as to approval of seniority list for allotment of sites, clearly show that about 80% works were already done in the said layout & about 485 sites were ready for allotment to members. Similarly though it is alleged that the accused paid 'good will' money to the out going partners of the developer firm out of the funds of the society, they have not produced any materials to substantiate the same. More so, though it is alleged that 33 C.C.No. 20267/2024 change of partners of said developer firm was made without the knowledge of society & KHB. the documents produced by the accused clearly show that said fact was intimated to society as well as the KHB. More over, there was no such condition either in the alleged tri-parte agreement or the sale agreement entered during the period prior to the period of these accused that any such change of partners or reconstitution of said firm have to be intimated to society & KHB. However as a matter of prudence, they have sincerely intimated the same. Further as revealed from the audit report as well as report of enquiry U/Sec.64 of Co-operative Societies Act, there are sufficient accounts maintained as to payments made to M/s. Usha Enterprises & personal withdrawal of money by the accused No.6 from the account of the society. As such there is no illegality in that regard. From all these facts & evidences, it is very clear that there was no such illegality & misappropriation of funds of the society by any one or more of these accused. But, the 34 C.C.No. 20267/2024 complainant-Pw1 in collusion with other aspirants of directorship of said society like Pw16, 18 & 23 have made false allegations against these accused & filed false complaints before the police as well as different authorities, only with the dishonest intention to defeat these accused being elected as directors of said society once again.
23. In the light of the above rival contentions let us examine each of the specific allegation as stated herein above one bye one. Firstly, with regard to the allegation that the developer firm-M/s. Supreme Associates was reconstituted during August 2011 by taking accused No.14 who is none other than the brother of accused No.1 as an incoming partner of said firm ( Ex.D30 ) without the knowledge & concent of society & KBH, it is pertinent to note that as rightly argued by Ld. defence counsel, there was no such term or condition that the developer firm shall take consent of society & KHB for its 35 C.C.No. 20267/2024 reconstitution and it cannot take any new partner without the knowledge & consent of society as well as KHB, either in the draft tri-parte agreement -Ex.D1 or sale agreement-Ex.D16 or any memorandum of understanding. Even though, it appears as a matter of prudence said fact was intimated to society as well as KHB as revealed from Ex.D17, 18 & Ex.D34. In the course of cross-examination the Pw1 also admits that such change in the constitution of said firm has nothing to do with the society. The Pw23 also admits the same in his cross-examination. More so, the I.O-Pw28 also clearly stated in his cross-examination that there is no such condition in any agreements between said society & the developer firm to take prior permission from the society while changing the partners of developer firm.
24. That apart the Pw27 who is the then Dy.Registrar of societies, in his evidence & report at point No.8 categorically says that as the said M/s. Supreme 36 C.C.No. 20267/2024 Associate have taken accused No.14-Lakshminaraya Gowda as its incoming partner on 5.02.2011, it cannot be said that accused No.1-G.A. Manjunath himself appointed him as partner of said firm. In his cross- examination also he has clearly stated that there was no need of prior permission from either the society or KHB for such reconstitution of developer firm. Therefore, there appear no such illegality on the part of accused in the said reconstitution of developer firm during 2011. Only because the incoming partner-accused No.14 is the brother of accused No.1, it cannot be held that accused No.14 was taken as a partner of said firm by accused No.1, because this accused No.1 being the director/president of Society, had no power or authority under any law or covenant to appoint or take any such partner to said firm or its reconstitution. Hence this allegation of the prosecution is not sustainable. 37 C.C.No. 20267/2024
25. Secondly, with regard to the allegation as to payment of 'good will' to the out going partners of said developer firm-M/s. Supreme associates from the funds of the society, Ld. Sr. App has argued that good will was paid to out going partner E.Krishnappa -accused No.13 at the time of taking accused No.14 as incoming partner from the funds of the society. The decision to pay said good will was recorded in the minutes of meetings of the society. But, the Pw1 has not made any such specific allegations in his complaint or evidence except producing copies of some resolutions of said society. However, the Pw23 in his evidence specifically stated that the board of directors of the society have agreed to pay good will to the out going partners of said developer firm to change its earlier partners in the board resolutions. But he has not specifically stated as to what was the amount that was paid as good will & to who it was paid. In this regard, on perusal of the extracts of minute of meetings of said society produced by Pw1 as per Ex.P4 & also Ex.D32 38 C.C.No. 20267/2024 produced by the accused, it is revealed that in the minutes of meeting dated 23.07.2010 at resolution No.23 such a demand for Good will of Rs. 9 crores by said E.Krishinappa was discussed & resolved to change him from the partnership of said firm. But no such resolutions to pay said Rs.9 crores appears to have been passed. Later, in the minutes of meeting dated 4.09.2010 (Ex.D32) at resolution No.30, it was resolved to make adjustments of the amounts already paid to said M/s. Supreme Associates from the accounts of incoming partners, which is also admitted by Pw23 in his cross- examination. As such it appears that even if any payments made till then were not towards any such good will from the society, rather it might have to be borne by said M/s. Supreme Associates only. Thus it appears that there were no such payments made to said E.Krishnappa- the accused No.13 as Goodwill from the funds of the society. That apart, the Pw27 in his evidence as well as in the report of enquiry U/Sec.64 also 39 C.C.No. 20267/2024 clearly stated at point No.9 that no materials found as to payment of any such Good Will from the funds of the society. Therefore, this allegation of the prosecution also is not sustainable.
26. Thirdly, with regard to the allegation as direct payment of Rs.54,00,000/- from the account of the society to M/s. Usha Enterprises during the period of accused No.6, firstly, it is pertinent to note that alleged payment was in relation to the Lay-out of said Society at K.Golla halli. As such the tri-parte agreement & its conditions were not applicable for the same. That being the case there is no question of any illegality in direct payment of said amount to said M/s. Usha Enterprises. However, it is alleged that said payment was also made without any authority & as such the same amounts to misappropriation. In this regard the prosecution has neither specifically stated in complaint or evidence of Pw1 & Pw23 or in the charge sheet as to when alleged 40 C.C.No. 20267/2024 payment was made. However, the extracts of minutes of meetings of said society at Ex.P4 reflect some discussions on the said issue in the board meetings dated: 4.03.2016, 30.11.2016 & 3.05.2017. This issue was also one of accusations for consideration in the enquiry under Sec.64 of the co-operative Societies Act conducted by Pw27. As per the testimony of Pw27 & his report, during said enquiry he had recorded the statement of accused No.6, wherein it was recorded that the quotations for the said works in the said layout were discussed in the board meeting & the works were allotted to the lowest bidder- M/s. Usha Enterprises and also the documents pertaining to that were very much available in the office of said society, but as the same were not furnished to the auditor during said period, the said objection was raised in the audit report. He also stated in his evidence & report that the in-charge secretary of said society during said enquiry had produced records, wherein it was found that said issue was discussed in the board meetings. He 41 C.C.No. 20267/2024 also stated in his report that the documents like estimation, engineer report, bills were produced during his enquiry & the same were also annexed to his report.
27. Further with regard to allegation as to withdrawal of Rs.18,00,000/- by the accused No.6 through self cheques, neither the complainant in his complaint, nor the prosecution has given details of alleged withdrawal of money through self cheques. However, it is noted in the enquiry report of Pw27 that said amounts were withdrawn periodically from 7.05.2015 to 22.08.2016 through self cheuqes. It is also reported that said amounts were withdrawn by the then President of said society- accused No.6 & the Honorary Secretary of said society -accused No.5. However, he also reported that during his enquiry said accused No.5 & 6 have stated that the receipts & vouchers relating to said amounts were maintained in the office of the society, but due to personal grudge present president of the society 42 C.C.No. 20267/2024 had not produced them during audit. Further he reports that on summoning, the in-charge secretary of society during said enquiry had produced the cash register & expenditure vouchers. On perusal of the same it was revealed that said amounts were utilized for meeting the expenses of board meetings, inspection of layouts development works & the incidental expenses towards maintenance of office of society and as such there is no illegality in the same & no such misappropriations. As the Pw27 during his enquiry appears to have collected all the relevant documents, verified them and arrived at such conclusion and also as those documents were also annexed to his report, there appear no grounds to disbelieve his findings on said issue. More over, the prosecution has not disputed said report or any part of it & the testimony of Pw27. Therefore, these two allegations of the prosecution are also not tenable.
43 C.C.No. 20267/2024
28. Fourthly, regarding the allegation as to purchase of lands earmarked for the purpose of said layout under the tri-parte agreement in the personal name of accused No.15 & his friend one Mr. P.S. Kumar, it is the case of the prosecution that as per the terms of tri-parte agreement the lands earmarked for said layout as per the schedule annexed to said agreement have to be purchased & transferred in the name of KHB on behalf of the society. But the accused no.15 who became one of the partners of said developer firm - M/s. Supreme Associates during June 2011 has purchased 1.16 acre in Sy.No.19/3 & 1.26 acre in Sy.No.19/2c of Kannegowdana halli villege of Nelamangala Taluk, which were earmarked for said Sarige Nagara layout under the schedule to tri- parte agreement in his personal name out of the funds of said society on 27.03.2012, but not transferred the same to KHB. Similarly, he has purchased 1.19 acre in Sy.No.33 of said village which was also earmarked for said layout, in the name of his friend Mr. P.S. Kumar out 44 C.C.No. 20267/2024 of the funds of said society on 14.01.2016, but not transferred the same to KHB. In support of the same the prosecution got produced the sale deeds in respect of said lands as per Ex.P44 to 47. On perusal of said sale deeds, it is revealed that the sale deeds at Ex.P44 & 46 in respect of 1.16 acre of Sy.19/3 & 1.26 acre of Sy.No.19/2c are standing in the name of accused No.15- Surendra & the sale deeds at Ex.P45 & 47 in respect of 1.19 acre in Sy.No.33 & 0.23 acre in Sy No.143 are standing in the name of one Mr. P.S. Kumar. Further on perusal of the schedule annexed to the tri-parte agreement at Ex.P8, it is revealed that said lands in said Sy.numbers were included under the 110 acres of land earmarked for formation of said Sarige nagara layout. More so, there is a specific condition that those lands have to purchased & transferred to KHB by the developer. Thus it is evident that the lands purchased by accused No.15 & his friend Mr. P.S. Kumar are part of the lands earmarked for said layout and also there are no materials 45 C.C.No. 20267/2024 as to transfer of said land to KHB. This is also clearly reflected in the enquiry report of Pw27 at Ex.P6. However, Ld. Defence counsel has argued & brought to notice of this court that the accused No.15 became partner of said firm from 24.06.2011, but much prior to that i.e., on 26.03.2011 itself there was a resolution by the society to the effect that the land already purchased till then i.e., 72.27 acres was sufficient to meet the demand for sites from the members of said society and as such no need for purchase of further lands. As such the society was not intending to purchase remaining lands earmarked for said layout under the schedule to tri-parte agreement. Hence, those lands were deemed to be out of said agreement. That being the case purchase of those lands by the accused No.6 or anybody for that matter would not amount to any breach of tri-parte agreement & any illegality.
46 C.C.No. 20267/2024
29. In the light of the said contention on perusal of the extracts of minute of meetings of said society produced by the prosecution at Ex.P4, it is revealed that there was a resolution at resolution No.46 to that effect, wherein it was resolved that as on that date about 982 members have made deposits towards allotment of sites in the said layout & the land available with the society as on that date was 72 acre and on considering the demand /requirement, said land of 72 acres is sufficient to form & allot such number of sites and no need for further purchase as the land value has increased, it may not be proper to make further purchase of lands. From this resolution, it can be inferred that the society had decided to stop purchase of further lands for the said layout over & above said 72 acres. As such the remaining lands under the schedule to tri-parte agreement were not intended to be purchased by the society, which amounts to dropping of those lands from the said project. That being the case purchase of such 47 C.C.No. 20267/2024 lands subsequent to said decision by the accused No.15 or anybody may not amount to breach of said tri-parte agreement or any such illegality. Though the Pw27 in his report has given such a finding, it appears that he might had lost sight of said resolution dated 26.03.2011. That apart, it is pertinent to note that, though prosecution has alleged that, said lands were purchased out of the funds of the society, it has not produced any iota of evidence to substantiate the same. Therefore, it can be concluded that alleged purchase of lands by accused No.15 & his friend Mr. P.S. Kumar under the said sale deeds was neither any breach of tri-parte agreement nor amount to any illegality. Hence this contention of the prosecution hold no water.
30. Lastly and mainly it is the allegations of the prosecution that, the accused have released Rs.12.10 Crore during the period 01/04/2010 to 30/06/2012, Rs.1.70 Crores during the period 01/12/2012 to 48 C.C.No. 20267/2024 30/01/2015 & Rs.93.10 Lakhs during the period 01/04/2015 to 14/09/2016 in favour of the developer - M/s. Supreme Associates. Further, it is the specific allegation that, the accused have released said amounts directly from the account of the society to the said M/s. Supreme Associates instead of paying through an ESCROW account in breach of the Tri-parte agreement. Further, it is the specific allegation of the prosecution that, said amounts were released without there being any developments in the said layout and without making any enquiry as to whether the developments were made in the said layout or not.
31. In this regard, Lrd.Sr. APP has argued that, the object of the society is to procure the land, formation of layout and allotment of sites to the members. With this aim they formed the society, collected the site advance from the members assuring sites to a reasonable cost to its members. It is very pertinent to note that, hard 49 C.C.No. 20267/2024 earned money of the members of the Society was collected. The accused No.1 to 12 who being the President, Secretary, Treasurer and Members of managing committee have acted quo-guardian and parted the society members' money by violating Tri-parte agreement and have illegally transferred the money directly to Developer firm who are accused No.13 to 16, rather than transferring through ESCROW account with malafide intention to misappropriate society funds without there being any work done. From 2010 to 2016 no single piece of land was purchased in the name of society nor any development works were carried out. Admittedly, before 2010 already 72 Acres 27 Guntas of land was purchased and transferred in the name of KHB on behalf of society. There is no dispute about the amount being transferred in the name of Developer Firm, there by the accused have caused loss to the society and to the hard earned money of members. Further, he has argued that, the accused persons and the developer firm 50 C.C.No. 20267/2024 from 2010 to 2016 have not done any developmental works nor have purchased any new piece of land, however, have transferred huge sum of money directly violating tri-parte agreement and agreement of sale dated:
25/01/2007. The fact that execution of Agreement of sale dated: 25/01/2007 is recorded in the minutes of meetings dated: 29/04/2007, where in the accused were also the members of the committee.
32. On the other hand, Lrd.Defence counsel has argued that, though there is a condition in the draft Tri- parte agreement - Ex.D1, there are no materials produced by the prosecution to show that any such ESCROW account was opened either before approval of Tri-parte agreement or after the approval of said agreement on 05/02/2011. The prosecution though contended that, prior to 2010 an amount of Rs.24.22 Crores was paid to the Developer towards purchase of 72.27 Acres of land through ESCROW account, they have 51 C.C.No. 20267/2024 not produced any such materials to show that said amount was paid through any such ESCROW account, except producing the statement of account of the current account of society in the Vijaya Bank, Shanthinagar Branch for the period 2006 to 2017 as per Ex.P13. As the alleged Tri-parte agreement was not accepted & approved by the society till 05/02/2011, there was no condition to pay any such amounts to the Developer through any such ESCROW accounts. Therefore, the payments made by the accused during their period directly to the Developer was neither in breach of any such Tri-parte agreement nor with any dishonest intention to misappropriate. Admittedly, all the said payments were made by the accused through cheques of the Bank account of the society to the account of the Developer. No single rupee was used by any of the accused for their personal gain. As such, there was no dishonest intention in making alleged payments. Further, though the prosecution has alleged that said 52 C.C.No. 20267/2024 amounts were paid to the Developer without there being any development in the said layout, it has not produced any materials to substantiate the same. Rather, the documents and evidences produced by the prosecution and also the documents produced by the accused clearly show that there was about 80% development in the layout as on the date of complaint. Even the PW27 who did enquiry about the allegations against the accused U/sec.64 of the Co-operative Society Act, also in his evidence categorically admitted that he has not done any such spot inspection and expert estimation to ascertain as to how much developmental works were done in the said layout. The letter correspondences, orders & other communications made by the authorities like, BMRDA, Nelamangala Planning Authority, the Executive Engineers of KHB & The Registrar of Co-operative societies, clearly establish the fact of developmental works being carried in the said layout to the extent of 80%. Therefore, there is no merits in the allegations of the prosecution that, the 53 C.C.No. 20267/2024 accused during their tenure illegally paid alleged amounts to the developer without there being any developmental works in the said layout.
33. In the light of the rival contentions, on careful scrutiny of the allegations made in the complaint and the oral and documentary evidences produced by both the parties, it appears that, there are two major allegations as against these accused. Firstly, the payments to the tune of 14.73 Crores were made from 2010 to 2016 during the period of accused No.1 to 12 directly to the developer instead of paying through ESCROW account as per the Tri-parte agreement. In this regard, on thorough search of the entire evidence adduced and produced by the prosecution, as rightly argued by the defence counsel there are no materials to show that any such ESCROW account was opened either prior to 2010 or after 2010. Though the prosecution has contended that upto 2010 an amount of Rs.24.23 Crores was paid to the Developer 54 C.C.No. 20267/2024 towards purchase of 72.27 Acres of land through ESCROW account as per the Tri-parte agreement, it has not produced any statement to show that said payments were made through any such ESCROW account. Rather, the statement of accounts from the period 2006 to 2017 produced by PW1 in his evidence as per Ex.P13 are all related to the current account of said society in the Vijaya Bank, Shanthinagar Branch, Bengaluru, but not any such ESCROW account. Admittedly, the draft Tri-parte agreement - Ex.D1 was not accepted by the Board of Directors of society when it was approved by the Government during 2007. But, the same was returned seeking some modification in the quantum of amount to be paid to the developer after purchase of lands for the said project. But, the said modification was not effected and said draft Tri-parte agreement was not approved and accepted till 05/02/2011. On 05/02/2011 the said Tri- parte agreement was modified and accepted. In the meanwhile the society stated to had entered into a MOU 55 C.C.No. 20267/2024 & Sale agreement as per Ex.D16 on 25/01/2007. In the said agreement there was no such condition as to ESCROW account. Rather, it says at condition No.8 that the society shall deposit the land value amount in joint account to be registered before the first party transferring the land in favour of KHB. But, no materials are produced to show that as per the said condition the society had opened any such joint account before making alleged payments of Rs.24.23 Crores.
34. Further, though the prosecution claims that pending approval of alleged draft Tri-parte agreement, the society had entered into said MOU and sale agreement - Ex.D16 in conformity with the terms of draft Tri-parte agreement, admittedly the KHB was not party to said MOU & Sale agreement. When said Tri-parte agreement specifically says that, said layout has to be developed with the joint venture of society, KHB & the developer, how come the society could enter into any 56 C.C.No. 20267/2024 such MOU or sale agreement with the developer excluding KHB. That apart, even in the said draft Tri- parte agreement also there is no such condition empowering the society or the developer to enter into any such MOU & Sale agreement among themselves. Even if, there is any such conditions, when said draft Tri-parte agreement itself was not accepted and approved by the society, how come the society would act on it or how said agreement binds the society. Therefore it is evident that, till the approval of draft Tri-parte agreement on 05/02/2011 there was no binding condition for making any such payment to developer through any such ESCROW accounts. Further it is also evident from the materials produced by the prosecution that, either under said draft Tri-parte agreement - Ex.D1 or under the alleged MOU & Sale agreement - Ex.D16 no such ESCROW account was opened or registered by the society. In this regard, the accused got produced and marked the note submitted by the Financial controller, 57 C.C.No. 20267/2024 KHB Bengaluru to the Commissioner, KHB as per Ex.D4 stating that there are no documents to show that, there was any such ESCROW agreement between the society and the KHB relating to any joint ESCROW account under the account No.119300301000071 in Vijaya Bank, Shanthinagar Branch, Bengaluru, which was also admitted by PW1 & PW18 in their cross-examination. More so, the PW1 in his cross-examination at page No.11 categorically admitted that all the amounts paid to the Developer - M/s. Supreme Associate from the society were paid through said Vijaya Bank account of the society. Though the society appears to have written a letter communication on 23/01/2007 to the Commissioner, KHB regarding its decision to open a joint account in said Vijaya Bank, Shanthinagar Branch as per Tri-parte agreement and asked the KHB to give the name & details of its officer to act under said joint account as per Ex.D24, no materials are produced as to whether any reply was given to said letter and any such joint account 58 C.C.No. 20267/2024 was registered in the said Vijaya Bank. The PW23 in his cross-examination categorically admitted the same and stated that, as per the condition of Tri-parte agreement they have prepared an ESCROW agreement. But, he has stated that, no such agreement or document was produced to the investigating officer. The PW24 who is stated to be the Auditor of said society in his cross- examination categorically stated that, in the course of his auditing he has not examined as to whether the alleged direct payments or transfer of amounts were made from the accounts of the society or any such ESCROW account. He categorically stated that, to open any such ESCROW account one has to produce the documents prescribed by the bank. But, the prosecution has not produced any such documents if any produced to said bank for registering any such ESCROW account. Similarly, the PW27 who is the then Deputy Registrar of Co-operative Societies, who did enquiry U/sec. 64 of Co- operative society Act, in his cross-examination at page 59 C.C.No. 20267/2024 No.5 deposed that in the course of his enquiry he has not seen the format of agreement to be entered between the society & KHB in order to open & operate an ESCROW account, which was annexed to the draft Tri-parte agreement. Admittedly, the draft Tri-parte agreement on its approval was annexed with an agreement format for the purpose of opening and operating such ESCROW account by the society & KHB. But, as revealed from the evidence of prosecution no such agreement was forthcoming. Apart from the above, it is pertinent to note that, though there is such a specific allegation, the investigating officer of this case i.e., PW28, as admitted by himself in his cross-examination has neither obtained any information from the Bank about the conditions for opening an ESCROW account nor collected any document as to existence of any such of ESCROW account relating to said society. That being the case, it cannot be accepted that, any such ESCROW account was opened & operated even prior to 2010 or after 2010. 60 C.C.No. 20267/2024
35. Secondly, it is the specific allegation that the accused No.1 to 12 during their tenure released such huge sum of 14.73 crores in favour of the developer i.e., accused No.13 to 16 from 2010 to 2016 without verifying as to whether the developmental works equivalent to said amounts were done in the said layout or not. It is the specific allegation that, the accused No.1 to 12 in collusion with accused No.13 to 16 illegally with the dishonest intention to misappropriate the funds of the society & to cheat the society have done so. In support of the same, the prosecution has relied on the oral testimony of Pw1, Pw23 & also Pw24 & 27.
36. In his evidence the Pw23 has deposed that, during 2010 to 2012 the then board of directors by substituting the brother of accused No.1 as a partner of M/s. Supreme Associates, had time to time released money from the account of the society in favour of developer to the tune of total Rs.12 crores, during the 61 C.C.No. 20267/2024 period of Accused No.4 during 2012 to 2014 had released Rs. 2.63 crores. The Pw24 who is the then auditor of said society in his evidence deposed that in the audit report for the period 2010-11, it was reported that during 2010-11 Rs.11,72, 84,449/- was paid directly to the developer and during 2015 to 2017 Rs.9,80,000/- & Rs.21,00,000/- were paid directly to the developer. He also deposed that as there was a complaint about the same to the registrar of co-operative societies, an enquiry U/s.64 was done and on the basis of said enquiry he has stated in his audit report that said Rs.12.10 crore has to be recovered from the accused No.1, accused No.2 & accused No.3 who were the president, vice president & Honorary Secretary of said society during 2010 to 2012 and Rs. 65,39,911/- has to be recovered from accused No. 4, accused No.3 & accused No.5 who were the president, vice president & Honorary secretary of said society during 2012 to 2014 along with accused No.6 who was the president of said 62 C.C.No. 20267/2024 society during 2015 to 2016 & the developer-M/s. Supreme Associates. The Pw27 who was the then Dy. Registrar of co-operative societies in his evidence deposed that, in his enquiry under Sec.64 of Co-operative societies Act, he has given finding that during 2010 to 2016 there was an excess payment of Rs.65,39,911/- to the developer and no guarantee was obtained for Rs.12.10 crores paid to the developer. However, in his report - Ex.P6, he has categorically mentioned the details of alleged payments made during 2010 to 2012 & 2012 to 2016. In the course of his evidence, the Pw1 has deposed in support of the same & produced the statement of accounts of the current account of said society in The Vijaya Bank, Shanthinagar branch for the period 2006 to 2017 as per Ex.P13. He also produced the details of money paid to the developer firm during 2010 to 2012 as per Ex.P19 & during 2015 to 2016 as per Ex.P20.
63 C.C.No. 20267/2024
37. On perusal of Ex.P13, Ex.P19 & 20, it is revealed that, from 23/08/2010 to 27/06/2012 an amount of Rs.12.10 Crores was paid to said M/s. Supreme Associates from time to time on different dates under 27 cheques in total. Similarly, from 25/06/2015 to 14/09/2016 an amount of Rs.93.10 Lakhs was paid to said M/s. Supreme Associates from time to time on different dates under 18 cheques in total. In the course of cross-examination of PW1, the accused have neither denied nor disputed said Ex.P13, 19 & 20 and the payments made therein. As such, it is clear that there is no dispute with regard to alleged payments made from the account of the society to the Developer - M/s. Supreme Associates during the said periods. However, Ld.Defence counsel in the course cross-examination of prosecution witnesses as well as in his arguments categorically contended that, all the said payments were made after due discussion and approval in the Board meetings. Only because said payments were made 64 C.C.No. 20267/2024 directly from the account of the society to the account of developer instead of paying through an ESCROW account as contemplated in the alleged Tri-parte agreement, it cannot be inferred that said payments were made by these accused with dishonest intention to misappropriate the funds of the society, in the absence of any specific evidence or material or circumstance to draw such inference as to dishonest intention. He further argued that, only because the said developer firm was reconstituted by substituting one of its partners with accused No.14 who is the Brother of accused No.1, it cannot be inferred that said substitution was made with any such dishonest intention for misappropriating the funds of the society, in the absence of any materials to show that the accused No.1 or any one or more of the accused No.1 to 12 had any control or authority over the constitution of said M/s. Supreme Associates. More so, admittedly, there is no such condition either in the draft Tri-parte agreement - Ex.D1 or the fair Tri-parte 65 C.C.No. 20267/2024 Agreement - Ex.P8 or the MOU & Sale agreement at Ex.D16 to obtain prior permission from the society or KHB for any such reconstitution of developer firm. As such, said substitution is not amounting to any such illegality or breach of any agreement between the society and the developer. That being the case, it is not possible to infer any such dishonest intention on the part of these accused in substituting the partner of said M/s. Supreme Associates. In support of his contentions, he has relied on the extracts of Board meetings of said society, which is produced by the complainant - PW1 as per Ex.P4 and also the accused in the course of cross-examination of PW1.
38. In the light of the contention of defence counsel on perusal of extracts of Minutes of meetings of said society at Ex.P4 & also the extracts of relevant minutes of meetings of said society produced by the accused in the course of cross-examination of PW1 on confrontation 66 C.C.No. 20267/2024 as Exhibits D series, it appears that, on payment of each of the items as stated herein above to the developer firm there were discussions and resolutions in the Board of Directors' meetings. As shown in Ex.P4 there was a resolution under Resolution No.24 in the Minutes of Meeting dated: 20/08/2010, wherein it was resolved to pay Rs.2.75 Crore directly to the Developer in order to speed up the development of said layout which was pending without any work since one year. Further, in the resolution dated: 04/09/2010 at resolution No.30 it was resolved that the amount of Rs.2.75 Crore already paid to the Developer and the remaining Rs.4.75 Crore to be paid to the Developer shall have to be adjusted after the change of partners of Developer firm from the amounts to be payable. Further, in the same Minutes of Meeting at Resolution No.34 it was resolved to do financial transaction with the Developer directly from the account of the society and cancel the ESCROW account under the Tri-parte agreement. Further, in the same 67 C.C.No. 20267/2024 Minutes of Meeting and the same resolution the request of developer for release of Rs.9.25 Crores towards the purchase of land and developmental works was discussed and resolved to pay the said amount from time to time in stages after looking into the developmental works. Similarly, in the Board Meeting dated: 27/11/2010 at Resolution No.42 it was resolved to pay Rs.1 Crore to the Developer directly towards further developmental works in the said layout after discussion and approval of earlier payments and developments. Further, in the Board Meeting dated: 26/03/2011 at resolution No.46 it was recorded that on demand of the Directors the documents like, Bank records & the payment vouchers & receipts as to the payments made to M/s. Supreme Associates from 01/02/2007 to 23/08/2010 i.e., Rs.24.22 Crores and from 23/08/2010 to 25/02/2011 i.e., Rs.9.56 Crores and also the intimation to KHB as to cancelling ESCROW account and resolving to make direct payment to the developer were placed in the Meeting, which was 68 C.C.No. 20267/2024 discussed in detailed and approved. It was resolved in the said meeting that making such direct payments to the developer was necessary for speedy development of the layout in the interest of the members who have deposited money towards sites in the said layout. In the same resolution it was also resolved to maintain the rate of sites as agreed in the Tri-parte agreement as the land value and developmental expenses have been increased. Further, in the Board Meeting dated: 23/02/2011 at Resolution No.52, it was resolved to pay Rs.50 lakhs to the developer towards further development after discussing the developmental works done in the said layout. Further in the emergency board meeting dated:
11/01/2012 at resolution No.82, the demand placed by the developer through its partner - Surendra for immediate payment of Rs.70 to 80 Lakhs to the developer for purchasing land for formation of connectivity road and other developmental works as the cost of development has been increased was discussed and 69 C.C.No. 20267/2024 resolved to pay only Rs.50 lakhs. In the Board meeting dated: 03/03/2012 at Resolution No.96, the request made by M/s. Supreme Associates for release of Rs.1 Crore towards developmental works was discussed and the President suggested for payment of Rs.50 Lakhs only, which was discussed and placed for voting, but as some of the Directors have opposed for the same, the said topic was postponed to subsequent meetings. Later, in the Board meeting dated: 12/03/2012 at Resolution No.101, said topic was discussed and resolved to pay Rs.50 Lakhs to the developer on majority voting. Further, in the Board meeting dated: 10/12/2012 at Resolution No.151 the letter received from KHB regarding payment of land conversion fees, the upset price for A Kharab lands & also the fees towards Podi & durasth in respect of 55.24 Acres and the request letter from the Developer for release of Rs.2 Crores was discussed and resolved to pay Rs.1 Crore to the developer considering the financial 70 C.C.No. 20267/2024 difficulty and condition of the Developer and also to speed up the developmental works in the interest of members.
39. From all the above discussed Board resolutions, it appears very clear that, the Board of Directors during 2010 to 2015 have got approval of the Board of Directors in the Board Meetings for release of said money to the Developer firm. Further, from said resolutions it appears that, they have resolved to cancel the ESCROW agreement as contemplated under the Tri-parte agreement and resolved to make direct payment to the developer firm from the account of the society so as to speed up the developmental works by the developer in the interest of members. Further, it is also found that, said decision of the society was intimated to the KHB also. More over, as already discussed herein above, as the draft Tri-parte agreement, which was kept pending approval with some modification had not been modified and approved till 05/02/2011, for the payments made till 71 C.C.No. 20267/2024 then, there might not be any such condition to pay through ESCROW account. The obligation under the Tri-parte agreement would arise only after its approval after modification from 05/02/2011 onwards. Though the terms of said agreement bind the society from 05/02/2011, as there is a provision in the same agreement for effecting any changes or modification in consultation with both the parties, the society was vested with such right of effecting change in the conditions of said agreement in consultation with the developer. As such, the decision of the society in cancelling ESCROW agreement or account as stipulated under the Tri-parte agreement and the resolution to make direct payment towards development of said layout may not amount to an illegality. Further, no doubt, in some of the resolutions there were protests by one or more Directors of said society towards the payments resolved to be made to the developer. But, that itself would not render such resolutions illegal. Because, any such resolution would 72 C.C.No. 20267/2024 be passed by the majority in the Board. As the said society was having 12 Directors as the Board of Directors, it is enough if 7 out of said 12 Directors vote in favour of such resolutions. Therefore, the resolutions approved in the said meetings with such protest or objection by one or two Directors may not disqualify said resolutions. More over, many of such Directors who have objected or protested for the resolution are also the accused in this case.
40. The other contention of the prosecution is that, said amounts were released in favour of the developer firm without there being developmental works done equivalent to the amounts released and also it is alleged that the accused being Directors of said society during the said period without doing any inspection of the developmental works in the said layout with an expert released said amounts illegally. In this regard, it is argued by the defence counsel that, the documents 73 C.C.No. 20267/2024 produced by the prosecution themselves show that there were developmental works to the tune of 80% in the said layout during said period. Similarly, the documents produced by the accused in the course of cross- examination of prosecution witnesses, which were intentionally withheld by the complainant - PW1 and the present Board of Members of said society also clearly show that there was about 80% work done in the said layout during the said period.
41. In the light of the contention of the defence counsel, on careful scrutiny of the documents produced by the prosecution as well as the accused, it appears that as rightly argued by the defence counsel there was about 80% works done in the said layout as on the date of lodging this complaint. The defence counsel relied on Ex.D11 i.e., the spot inspection report submitted by Executive Engineer, KHB, Bengaluru Rural Co-ordination Unit to the Commissioner, KHB, Bengaluru on 74 C.C.No. 20267/2024 03/10/2019, wherein it was reported on spot inspection that about 80% of work was being done in 23 Acres of Sy.No.9, 10, 11, 12, 14, 16 & 17 of Kannegowdanahalli Village. It is also reported about installation of boundary stones & signage boards to the plots, formation of drainage with stones and formation of manhole and UGD works with flush chambers, installation of overhead tank of 2 Lakhs Ltr capacity. The defence counsel also relied on the order of Registrar of Co-operative societies, Bengaluru dated: 28/10/2016 giving approval of seniority list for 485 sites in total out of available 503 sites of different dimensions in the said layout and submitted that as the developmental works were done in the said layout, the Registrar of Co-operative societies had accorded approval for the seniority list of the members for allotment of sites. Further, he also produced the letter dated: 02/04/2018 issued by PW23 - Vishveshwaraiah as the President of said society, wherein he has categorically stated that Sri. V.K. Puttaswamy was 75 C.C.No. 20267/2024 the president of said society from 17/11/2012 to 31/03/2015 and in his period an amount of Rs.2,61,85,826/- was released to the developer after approval in the Board meeting, out of which Rs.62.83 Lakhs was paid by the developer towards conversion of land of about 54 Acres, on 15/04/2014 Rs.70,85,826/- was paid to Nelamangala Planning authority to through cheque No. 283015, Rs.21 Lakhs was paid to the Pollution control Board through cheque No. 084722 & the remaining Rs.1,07,17,000/- was paid for Plan approval of 40 Acres through M/s. Supreme Associates. He also stated that as per the approved plan about 555 plots / sites have been bifurcated, the pipeline for water supply and the drainage works were carried out during the said period. This information furnished by PW23 himself shows that during 2012-2015 whatever the payments made were made as per the approval of Board of said society and utilized only for the developmental and other incidental expenses of said layout and also it shows that 76 C.C.No. 20267/2024 as on that date about 555 plots were formed and pipelines were laid and drainage works were done.
42. Further, the defence counsel has relied on Ex.D35 i.e., the request letter submitted by M/s. Supreme Associates to the Society and KHB on 21/08/2018, wherein the payment of 39.87 Crore as on that date was admitted and reported about purchase of 72 Acres of land, conversion of lands, approval from BMRDA, Plan sanction from Nelamangala Planning Authority, obtaining NOC from Pollution Control Board, release of sites from the planning authority, completion of UGD enlvert, overhead tank, water lines & metaling & Thar works on the roads out of said amount released in their favour. Further in the said request they have requested the society to renew the Tri-parte agreement which was terminated in 2016 for proceeding with further development works in the layout. The society also had given a reply to said letter on 03/09/2018 as per Ex.D36, 77 C.C.No. 20267/2024 wherein, the developer firm was requested to complete the developmental works as early as possible and as per their request the sale agreement and Tri-parte agreements would be renewed after the inspection of developmental works through the Commissioner, KHB and till then both society and the developer should act under the earlier Tri-parte agreement and MOU.
43. Further, the accused also produced the reply given by the in-charge Secretary of said society to the Joint Registrar of Co-operative societies, Bengaluru on 15/11/2017 as per Ex.D38. In the said reply it was clearly stated that, as per the Tri-parte agreement lands were purchased and transferred to KHB from time to time during 2006 to 2011 and thereafter on 05/02/2011 original Tri-parte agreement was effected. Out of 40.29 Crores collected from the Members / Site aspirants as deposits, Rs.39.79 Crore was paid to the developer towards purchase of land and developments. It is further 78 C.C.No. 20267/2024 reported that, out of 69.30 Acres of land that was purchased and transferred to KHB on behalf of the society by the developer, about 54.21 Acres was approved by BMRDA, out of which for about 40.23 Acres layout plan was approved by the Nelamangala Planning Authority during 2015 and about 55 plots of different dimensions were formed in the said area. It is also reported therein that, for allotment of available 503 sites in the said layout the seniority list was also got approved from the concerned authority as per law. It is also reported therein that, out of 69.30 Acres in possession of the KHB on behalf of the society, the allotment work is in progress in about 40.23 Acres as per the norms of BMRDA. That apart, it is also reported therein that, no complaints as to misappropriation of funds of society were received by the society as on said date and due to the circulars and notifications issued by the Government from time to time there is delay in acquisition of lands and as such there are no serious allegations against the 79 C.C.No. 20267/2024 Board Members of the society and as such no action were initiation against the Board Members. Further it is stated therein that, due to change of partners of said M/s. Supreme Associates there is delay in completion of said project and only few developmental works are required to be completed and the same would be completed as early as possible and allotment of sites would be taken up.
44. Further, the accused also produced the copy of Annual General Body Meeting of said society for the period 2015-16 dated: 23/09/2016 as per Ex.D40, which was held in the said 'Sarige nagara' layout itself. In the said General Body Meeting it was made known to the members that developmental works were done and as per the approved plan 555 sites were formed out of which 390 sites were allotted to the members as per the approved seniority list. It is further stated that, in the said layout the drainage, waterline, formation of roads, 80 C.C.No. 20267/2024 installation of overhead tank & metlings works were completed & only dambering of roads and laying electricity polls is pending. Further, on perusal of Ex.D41 a letter addressed to the Executive Engineer, KHB, by the Chief Engineer, KHB dated: 11/10/2019, it is evident that under the said letter the Chief Engineer, KHB had instructed the Executive Engineer, KHB to discuss with the said society as to the financial liabilities for taking up the remaining development works in the said layout and to submit the consensus proposal. In the said letter it is clearly stated that, as per the spot inspection done on 31/09/2019 about 80% of development works were being done and the report for taking up the remaining development works was submitted for necessary action and approval. More so, in the said letter the details of works done till date and the remaining works to be done were explained in a tabular form.
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45. Now, let us look into the evidence of PW1, PW16, PW17, PW18 & PW23 about all the above discussed documentary evidences. In this regard, the PW1 in his cross-examination categorically admitted Ex.D10, Ex.D11, Ex.D12 and also Ex.D23. He also admitted the legal notice given by him to Nelamangala Planning Authority as per Ex.D14. He also admitted that all the said amounts were paid to the developer through cheques and account of the society. Further, he has categorically admitted that during 2015 the PW23 - Vishveshwaraiah was also one of the Directors of said society and he has signed the resolutions passed during said period without any objection. Further, he has stated in his cross- examination that, any resolution including the resolutions for release of funds would be approved if 7 out of 12 members of Board of Directors in the society vote for the same. Though, he admits Ex.D23, he says that no such works were done and it was created. But, no action was taken against PW23 who stated to had 82 C.C.No. 20267/2024 issued said letter. More over, PW23 himself has not denied the same.
46. The PW16 in his cross-examination categorically admitted that for releasing any fund of the society prior approval from Board of Directors is necessary. Though this witness simply denies Ex.D10 & 11, he has not substantiated his denial with any substantive material or documents. However, he has categorically admitted Ex.D23 & deposed that he has signed the resolution giving approval for release of funds during 2015 to 2016. The PW17 in his cross-examination though simply denied Ex.D10 & 11 and stated that those documents were created, he has neither stated as to who has created those documents and nor chosen to examine the author of said letters. More so, he has categorically admitted that, no such ESCROW agreement as contemplated under draft Tri-parte agreement was there in the society. The PW18 in his cross-examination pleaded his ignorance 83 C.C.No. 20267/2024 about Ex.D10, Ex.D11, Ex.D14 & Ex.D23. However, he has categorically admitted Ex.D4 i.e., the Endorsement given by the Financial controller, KHB as to non- existence of ESCROW agreement. Further, this witness has categorically admitted that the draft Tri-parte agreement was not approved by the society and no reply had come from the KHB for the request of the society for modification of terms of said draft Tri-parte agreement.
47. The PW23 in his evidence stated that the draft Tri-parte agreement was modified and returned within 15 days of request made by the society. But, as per the case of the prosecution said Tri-parte agreement was approved and accepted on 05/02/2011. If as stated by this witness said draft Tri-parte agreement was modified within 15 days of its request, why the Board of Directors during said period have not accepted and approved said agreement, instead of which why they have entered into a separate MOU / Sale agreement as per Ex.D16. There is 84 C.C.No. 20267/2024 no explanation in this regard by PW23. Further though he has accepted Ex.D25 & 30, he says that Ex.D30 was received later i.e., subsequent to reconstitution of developer firm and release of goodwill amount. But, as already discussed herein above there are no materials to show payment of any such goodwill by the society or by said M/s. Supreme Associates to any of the outgoing partners out of the fund released from the society. He also categorically admitted that any fund from the society would be released after approval from the Board of Directors with requisite quorum for majority. Further, he has categorically admitted Ex.D10, Ex.D11, Ex.D23, Ex.D31, Ex.D32 & Ex.D33. However, he says that in Ex.D31 what was recorded under Resolution No.46, was not true, but the same was intentionally recorded so in the Minutes of Meeting. But during said resolution this witness was not the Member of Board of Directors. That being the case, he cannot give any opinion about said resolution, unless any of the Members of Board of 85 C.C.No. 20267/2024 Directors during said period would say so. The PW18 was also one of the Directors during the said period, who has not stated anything about the same in his evidence. More over, said resolution was approved by the requisite quorum in the said Board Meeting. Therefore, this version of PW23 is not sustainable. Further, he has categorically admitted that in the enquiry report U/sec. 164 of the Co-operative Societies Act, it was observed that releasing funds and purchase of lands on the basis of draft Tri-parte agreement on 25/01/2007 prior to its final approval on 05/02/2011 was clear violation or breach of said agreement. He also admitted that in the said enquiry report it was stated that no documents were produced as to purchase of lands or developmental works done in the said layout. Further, he has admitted Ex.D41, wherein a tender proposal was sent by KHB for taking up remaining developmental works in the said layout. That apart he has stated that the estimation at Ex.P43 was done through a registered valuator M/s. 86 C.C.No. 20267/2024 Ramachandra & Associates. But, he has admitted that he has not produced any letter correspondences with said valuator and also document to show that they are registered valuator. More so, it appears that he has not made any communication regarding said valuation to the KHB & the Registrar of co-operative societies before whom an enquiry U/sec. 64 of Co-operative Societies Act was pending. He has also admitted that during said estimation no mahazar was conducted. But, says that at the time of said estimation the Directors of the society were also accompanied said valuator. But, he admits that there is no mention about the same in the said estimation report Ex.P43 and no seal & signatures of the Directors were obtained on the said report. Admittedly, alleged estimation at Ex.P43 was done during February, 2019. As on said date there was an enquiry U/sec. 64 of Co-operative Societies Act pending before the Dy. Registrar of Co-operative societies i.e., Ex.P27. That being the case, if at all any estimation of the 87 C.C.No. 20267/2024 developmental works done in the said layout ought to have been done by PW27 or at his instance by the society or jointly by the society, PW27 & the Developer firm. More so, except produced alleged estimation report, neither the prosecution nor PW28 have chosen to examine the said valuator to prove the correctness of said estimation. As such as the said estimation Ex.P43 was done by the society on its own without the knowledge & concent of developer or the enquiry officer and also as the author of said report is not testified before this court, no sanctity or evidentiary value could be attached to it. That apart, in the course of evidence of investigating officer - PW28, the defence counsel has elicited several improvements in the testimony of this witness as against his statement before the I.O U/sec. 161 of Cr.P.C., which is marked as Ex.P70, which appear to be material improvements amounting to material contradictions in his own testimony and the statement before the I.O. As such, his testimony to the extent of such improvements 88 C.C.No. 20267/2024 cannot be considered as substantive evidence in support of the case of the prosecution.
48. The PW24 is stated to be the Auditor who did auditing of said society for the period 2016-17, 2017-18, 2019-20 & 2020-21. In his evidence this witness has stated that in the audit report for the period 2010-11, it was reported that there was breach of Tri-parte agreement between the society, KHB & M/s. Supreme Associate by making direct payment to the said M/s. Supreme Associates. It was reported that an amount of Rs.11,72,84,449/- was directly paid to M/s. Supreme Associates during said period. But, admittedly he has not produced any such audit report for the period 2010-
11. More so, it was reported that, during 2016-17 Rs.9,80,000/- & Rs.21 Lakhs were directly paid to said M/s. Supreme Associates. But, no such audit report is produced for the said period 2016-17. In his report at Ex.P9 for the period 2019-20, he has stated that said 89 C.C.No. 20267/2024 Rs.12.10 Crores paid during 2010 to 2012 shall be recovered from the then President, Vice president & the Honorary Secretary. Similarly, Rs.65,39,911/- paid during 2014-15 to 2015-16 shall be recovered from the then President, Vice president & the Honorary Secretary. But, he has categorically stated in his evidence that he has reported so in his audit report on the basis of the enquiry report U/sec. 64 & the order U/sec. 68 of the Co- operative Department. Thus, it appears that, while arriving at such conclusion, he has not done an independent audit of the accounts of said society. Though, he has stated that alleged amounts shall be recovered from the concerned Directors, in his cross- examination he has categorically admitted that he has not reported that the same was misappropriation of funds and financial fraud. Therefore, though the report of auditor for the period 2019-20 says that alleged amounts shall be recovered from the concerned Directors, it has not held that alleged payments amounts to any such 90 C.C.No. 20267/2024 dishonest misappropriation or financial fraud. More so, it is pertinent to note that, though in the report for the period 2019-20, it was observed so, as the earlier reports for the alleged periods of misappropriation were not produced, it may not be possible to accept such observations in the said report - Ex.P9.
49. The PW27 who is stated to be the Then Dy.
Registrar of Co-operative Societies, who stated to had done an enquiry U/sec. 64 of the Co-operative Societies Act, as per the orders of Registrar of Co-operative Societies and submitted the report as per Ex.P6, in his evidence deposed that, in his enquiry he has given in all 11 findings on the basis of complaint received by the department. It is pertinent to note that, in his finding it was observed that during 2010 to 2016 an excess amount of Rs.65,39,911/- was paid to the developer by the society. But, the case of the prosecution is that, there is misappropriation to the tune of Rs.14.73 Crores. 91 C.C.No. 20267/2024 If at all, as alleged by the prosecution there is misappropriation of such a huge sum of money, definitely that should have been reflected in the enquiry report of PW27. He has not stated anything and not given any finding as to any such misappropriation of Rs.14.73 Crores, except giving a finding to the effect that the society had not obtained any guarantee for the payment of Rs.12.10 Crores to the Developer. But, admittedly, there was no such condition either in the draft Tri-parte Agreement - Ex.D1 or fair Tri-parte Agreement - Ex.P8 or MOU / Sale agreement - Ex.D16 to get any such guarantee for payments made to the Developer. Further, he has admitted that during his enquiry he has not done any spot inspection of said layout and not conducted any valuation or estimation of works done in the said layout through any registered valuator or expert. That being the case, how come he gives such a finding that Rs.65,39,911/- was paid in excess during 2010 to 2016. More so, it is pertinent to note that, he has categorically 92 C.C.No. 20267/2024 deposed that the documents at Ex.D10, Ex.D11, Ex.D14 & Ex.D23 were not produced during his enquiry and also no relevant documents were produced before him for ascertaining as to whether the works equivalent to the amounts paid were done in the layout or not. Therefore, in the absence of examining or verifying any such documents and without conducting any such spot inspection and estimation, it may not be possible to arrive at any such conclusion as to either excess payment or misappropriation or misuse of funds of the society. More over, as already discussed herein above, this witness in his findings categorically given the findings to the effect that there are no illegalities in direct payment of Rs.54,24,000/- to M/s. Usha Enterprises and self drawal of Rs.18 Lakhs from the account of the society by accused No.6 and also that no goodwill amount was paid to the developer from the society and that as on 31/03/2019 as per the audit reports there was loss to the tune of Rs.18,14,039/- only to the society. That 93 C.C.No. 20267/2024 being the case, how come the prosecution alleged that Rs.14.73 Crore was misappropriated by the accused.
50. The PW28 is the investigating officer of this case, who completed investigation and filed charge-sheet in this case. On careful scrutiny of his evidence, it is evident that he has not seized any document either from the society or KHB or said M/s. Supreme Associates in connection with this case in the course of investigation. Rather, he has categorically admitted that all the documents produced with his charge-sheet were produced by PW1 and other witnesses like CW78 & 81 in the course of investigation. But, as admitted by him and also by PW1 no such notice summoning any such documents from PW1 or said witnesses were issued to them by the I.O during investigation. As such, it appears very clear that, whatever the documents produced by PW1 and CW78 & 81 at the instance of PW1 were accepted and acted upon by this witness - I.O. In this 94 C.C.No. 20267/2024 regard Ld. Defence counsel has argued that, the complainant - PW1 has produced the documents which are favorable to his complaint and with-held the other documents which reflect the innocence of the accused, which were produced by the accused during cross- examination of prosecution witnesses. On perusal of the testimony of the I.O & the documents produced by the accused, the contention of the defence counsel appears more probable. Further, it is pertinent to note that, PW28 in his cross-examination says that as per the enquiry U/sec. 64 & order U/sec. 68 of the Co-operative Department, there were no illegalities from 2006 to 2010 and as such he has not collected any document for the said period. But, he himself admits that in the complaint the allegations of illegalities were made from 2007 to 2016. That being the case, it was the duty of I.O to do fair and complete investigation on the entire allegations. But, he appears have not done so. This shows that he has not done an independent investigation, rather he has 95 C.C.No. 20267/2024 relied on only those documents produced by PW1 and also the report of Departmental enquiry U/sec. 64. Adding to this, the very fact that this witness in his charge-sheet and evidence categorically stated that, on the basis of the letters and documents produced by PW1, he has dropped PW16, 18 & 23 who were also named as accused in the complaint & FIR and implicated accused No.10 to 16, who were not mentioned in the complaint & FIR, shows that he has simply acted on the documents produced by PW1 and his statements. Further, as revealed from his cross-examination, he has not collected and verified several documents which appear to be crucial for the investigation like, draft Tri-parte Agreement, ESCROW accounts etc.,. Admittedly he has not collected the material documents like, Ex.D3, 10, Ex.D11, Ex.D12, 15, 16, 23, 38 & 41. He has categorically admitted that, he has not collected documents as to purchase of lands, developmental works in the said layout and also not visited & done spot inspection in the said layout and 96 C.C.No. 20267/2024 estimation of the developmental works during his investigation. More so, he also admitted that during his investigation he has not collected the audit reports from 2006 to 2016 of said society. He has categorically deposed that, he has not collected any documents to verify as to whether the payments made from the society to the developer from 2007 to 2011 were as per draft Tri- parte Agreement till its approval during February - 2011. That apart, it is pertinent to note that, in the course of investigation he has not given notice to accused No.1, 2, 3, 5 & 6. Thus, it appears that, the investigation done by him as against said accused was an one sided investigation. If, he had given any such notices to said accused they might had produced those documents like, Ex.D3, 10, Ex.D11, Ex.D12, 15, 16, 23, 38 & 41 to substantiate their defence. Therefore on considering the entire evidence of PW28, it appears that he has not done a fair and complete investigation, rather he has arrived at a conclusion to hold that the accused are guilty of alleged 97 C.C.No. 20267/2024 offences and submitted the charge-sheet against them only on the basis of the statements of complainant - PW1 and the documents produced by him and also by relying on the enquiry report U/sec. 64 & the order U/sec. 68 of the Registrar of Co-operative societies.
51. Apart from the above, it is pertinent to note that, in respect of the offence of criminal breach of Trust, the specific charges have to be made in respect of the amount of such misappropriation during each year or between 12 months as contemplated under the proviso to Sec.212(2) of Cr.P.C.,. In the matter of framing charge for such criminal breach of trust said special provision has to be strictly complied and proof must be given that the offence was completed between said period of 12 months. Any default in that regard cannot be cured by Sec.465 of Cr.P.C., But, the I.O of this case has neither done his investigation in that angle nor filed charge-sheet accordingly either specifying the amounts of alleged 98 C.C.No. 20267/2024 misappropriation during each year from 2010 to 2016 or separately for alleged misappropriation in each year. Therefore, there is default in filing the charge-sheet in this case which cannot be cured U/sec. 465 of Cr.P.C.,.
52. On considering all the above discussed documents and the facts contained therein and the oral evidences, it appears that, the developmental works to an extent of 80% were done in the said layout as per the norms. Only fact that can be deducted from all the said documents is that, there is considerable delay in completion of said project. It is also pertinent to note that, as mentioned in some of those documents themselves said delay in completion of developmental works was due to the notifications, circulars issued by the Government from time to time, which might had caused delay in acquisition of lands and change of land use. More so, as rightly reported by the secretary of said society as there has been change of partners of developer 99 C.C.No. 20267/2024 firm during the said period, there is such delay in execution of said project as agreed between them. Therefore, it is evident that, except such delay in execution of the project there is no such illegality in releasing the funds to the said developer firm by the society during the said period.
53. With regard to the allegation of the prosecution that, the accused No.1 to 12 being the Directors of said society and Governing Body during said period 2010 to 2015 colluded with the partners of developer firm i.e., the accused No.13 to 16 in releasing said huge sum of money, it is pertinent to note that, there are several Board meetings held during the said period, wherein the acts of developer in delaying the execution of said project was condemned and notices were issued to them in that regard for instance once such notice was issued on 31/01/2013 as per Ex.D21. Similarly, on 10/04/2010 at resolution No.5 a resolution was passed against the 100 C.C.No. 20267/2024 developer firm for not completing the project since January, 2007 and insisted for proceeding with the developmental work by entering into a separate agreement. Similarly, in the board meeting dated:
26/02/2013 under resolution No.163, the conduct of developer firm in not progressing with the development and not replying to the notices issued by the society was condemned and resolved to call the developer to the Board meetings and ask them to give complete detail about the developmental works and the year wise accounts as to the amounts received from the society. If at all, there is any such collusion between these accused No.1 to 12 and the developers, no such resolutions would have been passed in the Board meetings during said period.
54. Further, it is alleged that, the accused No.14 who is none other than the brother of accused No.1 was substituted into said M/s. Supreme Associates during 101 C.C.No. 20267/2024 the period of accused No.1 only with the dishonest intention of misappropriating the funds of the society. But as already discussed herein above, only because accused No.14 is the brother of accused No.1, it cannot be said that it is accused No.1 who got substitution of accused No.14 to the developer firm. More over, the accused No.14 was substituted into the developer firm as per Ex.D13 on 31/08/2010. Subsequently, on 24/06/2011 he was substituted by one Mr. Surendra, i.e., accused No. 15. Thus, it is evident that the accused No.1 had acted as partner of said M/s. Supreme Associates only for a period of 9 to 10 months. As per the details of payments made to said M/s. Supreme Associates during 2010 to 2012 produced by PW1 at Ex.P19 and also as reflected in the enquiry report of PW27 at Ex.P9, the total amount that was paid during the period of accused No.14 i.e., from 31/08/2010 to 24/06/2011 was only Rs.6.70 Crores, but not Rs.12.10 Crores as alleged by the prosecution. The remaining 102 C.C.No. 20267/2024 amount out of said Rs.12.10 Crores was paid subsequent to substitution of accused No.14 by accused No.15. If at all, the accused No.1 himself with such dishonest intention got substitution of his brother accused No.14 to said developer firm, he might not had changed him within a period of 9 months. That apart, as already discussed and held herein above, all the payments made during 2010 to 2012 were made through cheques of account of said society and after approval from the Board of Directors in the Minutes of meetings held time to time. That being the case, there are no reasons to believe that, this accused No.14 was intentionally got substituted into the developer firm with the dishonest intention of releasing funds of the society in favour of the developer firm or accused No.14. That apart, it is pertinent to note that, in the Board meeting dated: 20/08/2010 as per resolution No.28, a decision was taken to cancel ESCROW account and make direct payment to the developer and decided to pay Rs.2.75 Crores to the 103 C.C.No. 20267/2024 developer, which was prior to substitution of accused No.14 to the developer firm. More so, in the said meeting at resolution No.30, it was resolved to pay the balance of Rs.4.75 Crores to the developer firm and also resolved that upon change of its partners whatever the amounts paid to the developer firm till then should be adjusted or set off from the amounts payable to the developer firm after such change. As already discussed herein above, no goodwill money was paid by the society for alleged substitution of partners under said resolution. Similarly, in the same meeting at resolution No.34, the request of the developer firm for release of Rs.9.25 Crores was not accepted and resolved to release the money in stages based on the works done in the layout. If at all, there is any such dishonest intention on the part of accused No.1 & 14, all these resolutions ought not to have been passed. More over, it is not the case of the prosecution that, any such amount that was released in favour of developer firm during the period of said accused No.14 104 C.C.No. 20267/2024 was used by accused No.1 or accused No.14 for their personal benefits. It is not the case of the prosecution that, this accused No.1 or the accused No.14 were the beneficiaries under the alleged misappropriation.
55. If at all, alleged act of these accused during their tenure in passing such resolution as to direct payment to the developer firm is illegal, the act of previous body i.e., earlier to 2010 in entering into alleged MOU / Sale agreement with the developer firm as per Ex.D16 without KHB would also become illegal, when there is no such term as to any such MOU in the draft Tri-parte Agreement. Similarly, if the act of substitution of accused No.14 to the developer firm is illegal, the act of earlier body choosing said M/s. Supreme Associates which was registered under law on 28/12/2006 as the developer and entering into an agreement with it on 29/11/2006 itself i.e., prior to its registration would also amount to an illegality during the period of PW18 & 23. 105 C.C.No. 20267/2024 Similarly, the conduct of earlier body in not taking any action against the developer firm for not procuring 110 Acres of land for the said project within 60 days as agreed under the sale agreement at Ex.D16 would also an illegality.
56. From all the above discussed facts, circumstances and the oral & documentary evidences, what could be deducted is that; firstly, it is neither the case of the prosecution that alleged amounts paid to the developer firm or any part of it were used or utilized for the personal gain of any of the partners of said firm i.e., accused No.13 to 16 including the accused No.14 or any of the members of Board of Directors including the accused No.1, nor any materials or evidences were collected during investigation to that effect. Secondly, there is delay in execution / completion of said housing project, might be due to various reasons including ; delay in approval of draft Tri-parte Agreement with requisite 106 C.C.No. 20267/2024 modification, periodical change of partners of developer firm, periodical government notifications or circulars, objections by other members / Ex-Directors of said society to concerned authorities against the then Board of Directors, which caused delay in the process of acquisition of lands, getting approvals, sanctions or permits from concerned authorities & release of funds. Thirdly, violation or breach of certain terms of alleged Tri-parte Agreement and also the earlier MOU or sale agreement with the developer, might be due to the reasons recorded in various Board Meetings as discussed herein above. But, no such dishonest intention of misappropriation of funds of the society or deceptive intention to cheat the society and its members could be deducted.
57. To attract the offence of Criminal breach of Trust the essential ingredients of said offence as contemplated U/sec. 405 of IPC have to be fulfilled or 107 C.C.No. 20267/2024 established. The essential ingredients of offence U/sec. 405 are ; (1) entrustment of the property and (2) dishonest misappropriation or conversion of the property to own use or (3) dishonest use or disposal of the property in violation of mandate of law prescribing the mode in which the entrustment is to be discharged or (4) dishonest use or disposal of the property in violation of the terms of any legal contract either express or implied regarding the discharge of entrustment or willfully allowing some other person do so.
58. In the present case as discussed herein above, there is no dispute as to entrustment of property and its disposal. More so, from the evidence discussed herein above, it can also be inferred that the disposal of property was in violation of the terms of agreement like, Tri-parte Agreement as well as Sale agreement / MOU. But, that itself would not amount to criminal breach of trust because, such disposal should have been done with 108 C.C.No. 20267/2024 dishonest intention. As held by Hon'ble High Court of Orissa in the case of Eshwar Prasad V/s State of Orissa, reported in (1988) 3 Crimes 516, 'even if entrustment is proved in the absence of intension of conversion such entrustment into his own use or use contrary to the agreed terms, a mere failure to account for the property would not be criminal breach of trust even though it might be otherwise a breach of trust'. Similarly, as held by Hon'ble Apex court in the case of Sardhar Singh V/s. State of Hariyana, reported in AIR 1977 SC 1766, 'dishonest intention is a Sine Qua non in an offence of criminal breach of trust and as such the prosecution has to show that the accused dishonestly misappropriated or converted to his own use or dishonestly disposed off property entrusted to him, mere negligence or omission to account for such entrustment would not amount to dishonesty'. Further, as held by Hon'ble High Court of Patna, in the case of Sheonarayan Jaiswal V/s State of Bihar, reported in AIR 1953 Pat 225, in the offence 109 C.C.No. 20267/2024 of criminal breach of trust the word "dishonestly misappropriates" & " dishonestly uses or disposes" are very vital. If the dishonest intention is absent a mere breach of contract or a breach of conditions of a permit is not necessarily Synonymous with criminal breach of trust. More so, as held by Hon'ble High Court of karnataka in the case of L. Dhanya Naik V/s State, reported in 1977 Cr.L.J 654 , ' every offence of criminal breach of trust involves a civil wrong in respect of which complainant may seek a civil redress for damages in civil court. But, every breach of trust in absence of mens rea or criminal intention cannot legally justify criminal prosecution - criminal intention is the gist of offence under criminal breach of trust'. Similarly, as held by Hon'ble Apex court in the case of Jaswanthraj V/s. State of Bombay, reported in AIR 1956 SC 575, ' it may however be borne in mind that the same set of facts may give rise to both a civil liability and a criminal prosecution. But, if there is no mens rea or if the other essential 110 C.C.No. 20267/2024 ingredients of an offence are lacking, the same facts may not sustain a criminal prosecution, though a civil action may lie'. Further, in the decision of Hon'ble High Court of Gauhati, in the case of Deepak Moormoo V/s Sonaram Phukano, reported in 1989 Supreme (Gau) 97, it was held as follows:
" In order to constitute an offence under this section, it must be dishonest misappropriation, by a person in whom confidence is placed as to the custody or management of the property in respect of which the breach of trust is charged. There must be an entrustment ; there must be misappropriation or conversion to one's own use or use in violation of any legal direction or of any legal contract. Over and above, the misappropriation or conversion or disposal must be with a dishonest intention. Thus from a reading of the section and perusal of the essential requirements thereof, it is clear that dishonest intention is a necessarily ingredients of an offence of criminal breach of trust as defined in section 405 of IPC. Misappropriation simpliciter would not attract the provisions of said section. It is well settled that every offence of criminal breach of trust involves a civil wrong in respect of which the complainant may seek its redress for damages in the civil court, but every breach of trust in the absence of mens rea cannot legally justify a criminal prosecution".
59. As held by Hon'ble Apex court as well as the high courts in a catena of decisions stated supra, it is the 111 C.C.No. 20267/2024 dishonest intention which is the Sin qua non and essential ingredient to constitute the offence of criminal breach of trust and every breach of trust or breach of contract or conditions of an agreement without such dishonest intention or mens rea would not justify the offence of criminal breach of trust, rather that would amount to either a mere negligence or omission or civil wrong, for which the remedy is under court of civil jurisdiction. No doubt, it is difficult to get any direct evidence of intention. However, it may be justifiably inferred from the attending circumstances & the conduct of accused. In the present case as discussed and held herein above, there are no such materials or the circumstances to infer any such dishonest intention or criminal intention or mens rea on the part of the accused in disposal of funds of the society, though not in accordance with the terms of alleged Tri-parte Agreement or the sale agreement. Therefore, the alleged act of the accused would not amount to criminal breach of trust. 112 C.C.No. 20267/2024
60. With regard to the offence punishable U/sec. 420 of IPC as alleged in this case, it is pertinent to note that, the ingredients of offence of criminal breach of trust U/sec. 405 of IPC are different from the ingredients of an offence of cheating U/sec.420 of IPC. As such, said offences except in some rare and special cases would not go together. Because, the essential ingredients of the offence of cheating which is punishable U/sec.420 of IPC is that the existence of dishonest intention to induce the other person shall have to be there in the beginning. But, the dishonest intention in respect of criminal breach of trust may not be there in the beginning, rather it may be developed subsequently. Therefore, in the present case to attract the offence punishable U/sec. 420 of IPC, there must be a dishonest intention at the time of proposal of said housing project by the society during 2006 itself and at the time of collecting the deposits from its members. But, as per the allegations of prosecution in this case, there was no such offences prior to 2010. As such, it can 113 C.C.No. 20267/2024 be inferred that the allegations of this case would not cover the period from 2006 to 2009. As such, it can be held that there were no such deceptive intention on the part of the Board of Directors of said society at the time of proposal of said housing project and collection of deposits from its members during 2006-07. That apart, as held by Hon'ble Apex court in the case of Hridaya Ranjan PD . Verma V/s State of Bihar, reported in (2004) SCC 168, ' a mere breach of contract cannot give raise to a criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction. To establish the offence of cheating it is necessary to show that the accused had fraudulent or dishonest intention at the time of making the promise'. Therefore, the facts of this case would not attract the offence of cheating as defined U/sec. 415 of IPC, which is punishable U/sec.420 of IPC.
114 C.C.No. 20267/2024
61. From all the above discussed facts, circumstance and the evidences, it can be concluded that, the prosecution has miserably failed to prove that the accused have committed the offences punishable U/Sec. 408 & 420 R/w Sec.34 of IPC. Accordingly, Point No.1 & 2 are answered in the Negative.
62. Point No.3: In view of the above findings on point No.1 & 2, the following order is passed;
ORDER Acting under section 248(1) of Cr.P.C., the accused No.1 to 16 are hereby acquitted of the offences punishable under Sections 408 & 420 R/w sec.34 of IPC.
Bail bonds and surety bonds of the accused shall stands canceled.
(Dictated to the Stenographer directly on computer, after her typing, corrected, signed and then pronounced by me in open Court this the 17th day of July, 2025).
(K.N. SHIVAKUMAR) XLII Addl. CJM,Bengaluru (Spl.Court for trial of cases filed against sitting as well as former MPs/MLAs, triable by the Magistrate in the State of Karnataka) 115 C.C.No. 20267/2024 ANNEXURE Witnesses examined for the Prosecution:
PW.1 - T. Hanumanthappa PW.2 - T.G. Narayanamurthy PW.3 - M. Lingachari PW.4 - Manjunath PW.5 - Raghavachari PW.6 - Divakara H.B PW.7 - D. Divakara PW.8 - K.B. Basavaraju PW.9 - S.V. Venkatesh PW.10 - M. Shivanna PW.11 - Obbaiah PW.12 - A.M. Chandrashekaraiah PW.13 - Venkatesh PW.14 - T. Basavachari PW.15 - D. Suresh Kumar PW.16 - Ramalinge Gowda. L PW.17 - Ramaiah PW.18 - Hemaraju PW.19 - Umesh PW.20 - Jayappa PW.21 - Basavegowda PW.22 - Virupaksha PW.23 - Vishveshwaraiah PW.24 - D.B. Sajjanar PW.25 - Renuka J.M PW.26 - Savithri. K.C PW.27 - Venkatesh PW.28 - C.M. Mathpathi PW.29 - Banakar PW.30 - R. Shivanna PW.31 - Jayaram PW.32 - Husen Ahmmed Sharif PW.33 - Shekarappa 116 C.C.No. 20267/2024 PW.34 - M.V. Krishna PW.35 - Ramanayak PW.36 - Hemanna PW.37 - S.R. Nayarayana Swamy PW.38 - K.P. Shantharaju PW.39 - Chikkaiah PW.40 - Siddaiah PW.41 - G. Venkatarama PW.42 - Uday Kumar. M PW.43 - B.S. Philip Raj PW.44 - H.A. Jagadishwarappa PW.45 - M. Shivalingaiah PW.46 - B.K. Shivaiah PW.47 - Kalaiselvan PW.48 - N.P. Dakshin Murthy PW.49 - N.G. Patil Witnesses examined for the Defence:
- Nil -
Documents exhibited for the Prosecution:
Ex.P1 - Complaint Ex.P1(a) - Signature of PW1 Ex.P2 - Spot mahazar Ex.P3 - Certified copy of Bye-laws book Ex.P4 - Certified copy of Minutes of Meetings Ex.P5 - Certified copy letter Ex.P6 - Copy of Enquiry report U/sec.64 Ex.P7 - Copy of Order U/sec. 68 Ex.P8 - Copy of Tri-parte agreement Ex.P9 - Copy of Audit report
Ex.P10 to 12 - Copies of Resignation Latter of A6, A3 & A5 117 C.C.No. 20267/2024 Ex.P13 - Statement of Account Ex.P14 to 17 - Statements of PW2 to PW5 Ex.P18 - Letter with details of lands Ex.P19 & 20 - Letters with details of amounts paid Ex.P21 - Letter dated: 06/04/2021 Ex.P22 - Letter with details of amounts paid to Usha Enterprises Ex.P23 to 25 - R.T.Cs Ex.P26 to 36 - Statements of witnesses Ex.P37 - Letter with details of amounts paid to M/s. Supreme Associate Ex.P38 to 40 - Statements of accounts Ex.P41 & 42 - Extracts of Minutes of Meetings Ex.P43 - Estimation report Ex.P44 to 47 - Sale Deeds Ex.P48 to 51 - Mutations Extracts Ex.P52 - RTC Ex.P53 - Complaints to Authorities Ex.P54 to 58 - Voluntary Statements of accused No.1,3,6,5 &2 Ex.P59 & 60 - Further Statement of PW1 Ex.P61 - Letter dated: 19/03/2021 by PW1 Ex.P62 - Receipt Ex.P63 to 76 - Statements of witnesses Documents exhibited for the defence:
Ex.D1 - Tri-parte Agreement
Ex.D2 - Approved map
Ex.D3 - Extracts of Minutes of Meeting
Ex.D4 - Note by FC, KHB dated: 20/12/2023
118 C.C.No. 20267/2024
Ex.D5 - Notice dated: 25/04/2015
Ex.D6 - Letter dated: 05/03/2011 by AEE, KHB
Ex.D7 - Copy of Letter dated: 12/12/2006 by
Commissioner, KHB,
Ex.D8 - Copy of Letter dated: 31/01/2011 by
M/s. Supreme Associate
Ex.D9 - Copy of Letter dated: 20/01/2007 by Prl.
Secretary Housing Department
Ex.D10 - Copy of order dated: 28/10/2016 by Registrar of Co-operative Societies Ex.D11 - Copy of Spot inspection report by EE, KHB, Ex.D12 - Layout plan approval Ex.D13 - Copy of Stay Order by the Co-operative Minister Ex.D14 - Copy of legal Notice issued by PW1 Ex.D15 - Copy of Form - C Ex.D16 - Copy of Sale Agreement Ex.D17 - Copy of Reconstitution Deed of partnership Ex.D18 - Copy of letter communication by M/s.
Supreme Associate Ex.D19 - Further Statement of Complainant - PW1 Ex.D20 - Copy of Letter to NPA by AEE, KHB Ex.D21 - Copy of letter dated: 31/01/2013 by society to developer Ex.D22 - Copy of request Letter dated: 18/03/2013 to pollution control Board by AEE, KHB Ex.D23 - Copy of reply given by PW23 Ex.D24 - Copy of Letter 23/01/2007 by Secretary of society to KHB Ex.D25 - Extracts of Minutes of Meetings to 28 119 C.C.No. 20267/2024 Ex.P29 - Copy of Minutes of Meeting Ex.D30 - Copy of intimation as to reconstitution of partnership firm Ex.D31 - Extracts of Minutes of Meetings & 32 Ex.D33 - Copy of General Body Meeting Ex.D34 - Letter dated: 30/11/2010 by Society to KHB Ex.D35 - Copy of report and request by developer to society & KHB Ex.D36 - Copy of reply given by society to Developers Ex.D37 - Copy of report submitted by the society to KHB Ex.D38 - Copy of the reply given by the society to Joint Registrar of co-operative society Ex.D39 - Extract of Minutes of Meeting Ex.D40 - Copy of Annual General Body meetings Ex.D41 - Copy of instructions by Commissioner, KHB to EE, KHB.
Material objections:
- Nil -
(K.N. SHIVAKUMAR) XLII Addl. CJM,Bengaluru (Spl.Court for trial of cases filed against sitting as well as former MPs/MLAs, triable by the Magistrate in the State of Karnataka) 120 C.C.No. 20267/2024 (Order pronounced in the Open Court (Vide Separate Judgment) ORDER Acting under section 248(1) of Cr.P.C., the accused No.1 to 16 are hereby acquitted of the offences punishable under Sections 408 & 420 R/w sec.34 of IPC.121 C.C.No. 20267/2024
Bail bonds and surety bonds of the accused shall stands canceled.
XLII Addl. CJM,Bengaluru.