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12.This Court considered the rival submissions and perused the materials available on record.

13.In this case, 12 officials from Indian Bank, George Town Branch, Chennai were examined during trial. PW1 is the complainant, https://www.mhc.tn.gov.in/judis who preferred the complaint based on the inspection reports submitted by PW10 & PW12 (Exs.P28 & P29). The bank inspecting officials observation is that the Company was sanctioned with a credit limit of Rs.250 lakhs under OD against Book Debts and a limit of Rs.15 lakhs under the guarantee by the erstwhile Circle Office Chennai on 28.10.2006. The complaint primarily proceeds with the Auditors balance sheet for the year 2006 and thereafter, it had been renewed based on the estimated receivable submitted by the Company. PW14 is the Statutory Auditor of the bank, who also scrutinized the account. In the balance sheets and from the estimated glossy printed account, there is vast variance in respect of sundry debtors. As per the balance sheet, the sundry debtors was Rs.2,02,21,963/- and Rs.1,48,22,289/- against figures furnished by the Company in their glossy balance sheet is Rs.8,58,03,819/- and Rs.19,95,44,450/- respectively. The sanction and renewal is based on the estimation. The transaction was not found in the limited sanctions for 2006-07 and 2007-08. The bank officials confirmed that PW8, the Chief Manager initially accorded loan sanction. The unsigned documents namely glossy balance sheet does not have any entity and it is only a proposal based on the estimated receivables and https://www.mhc.tn.gov.in/judis projected business. It is also admitted that the Chief Manager has discretionary power in sanction of loans. The Inspecting bank officials have met the Auditors, enquired them with regard to the unsigned glossy balance sheet and the signed statement of the audited balance sheet. It is confirmed that for the first time, during October 2006, the OD facility was granted and the Company did not avail guarantee limit given to them. Further, hypothecation of stocks and Book Debts were considered. Added to it, it is seen that one Mr.Atul Mathur, Director of the Company was examined and he explained the reason and gave details of glossy printed unsigned balance sheet.

21.The evidence of the bank officials, Auditors and the employees of the Company confirmed that there is no diversion of funds in any manner and the Company could not repay the loan amount due to general recession and non receivable of the amounts from its clientele. Hence, huge debts occurred and the financial cycle of the company got stuck. The revenue projection went hay ware due to overall market condition, for which, the Company has no control. Thereafter, due to effective business and financial management, the Company was able to reduce its losses closing the branches in various cities, pruning its expenditures, reacting to the market conditions, some of the assets liquidated and approached the bank for one time settlement and finally, repaid the entire amount and all issues settled with the bank to their satisfaction and no https://www.mhc.tn.gov.in/judis recovery proceedings pending. The document in support of the settlement is marked and produced in this case. The investigating officer admits no prosecution against one A.L.Nagarathinam, Senior Manager and T.R.Narayanan, Chief Manager. For A.L.Nagarathinam, the sanction for prosecution was denied, as against T.R.Narayanan, the case was quashed by this Court. In this case, no public servant or any bank officials are accused. Further, the Investigating Officer feigns ignorance with regard to the Lehmann Brothers Scandal, one of the largest private sector business entity which lead to crash in the financial market. The bank officials confirmed the collapse of the petitioners business, was due to collapse in the financial market. The bank officials confirm that the Company customers are all first class business entities. Further, it is not in dispute that the business of the petitioners was running smoothly from 2006 to 2010 and the account turned NPA during June 2010. The witnesses confirms that the Company account turned into NPA only because of recession in the market and no amount from the OD account diverted for any other purpose. It is confirmed that the Auditors gave statement that the records of the Company with debtors ledger/statement on comparison and verification found no material discrepancy. PW8, the https://www.mhc.tn.gov.in/judis General Manager of the Bank confirms that “to my knowledge there was no bad intention either on the part of the bank staff or on the part of the Company to cheat the bank, only due to business loss, the Company failed to repay the loan, hence, none of the staff can be held responsible”. Further, the General Manager confirmed that no undue favour shown while granting OD facility. The bank officials confirmed that the submission of unsigned glossy statement is an accepted practise which is the projection of business. The projection is subjected to market/business conditions.