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In course of checking of the stock of fertilisers lying in the various godowns of BISCOMAUN and position of raw materials in the factories, `it was detected that huge quantity of unsold `Suraj Brand N.P.K.' mixture fertiliser was lying in the depots of BISCOMAUN which was being sent to the fertiliser factories of BISCOMAUN to be used as raw-material in the manufacture of `HARABAHAR ' (mixture fertiliser). On perusal of the relevant files, it transpired that `Suraj Brand N.P.K.' was purchased from a private firm namely M/s Rajasthan Multi Fertiliser Pvt. Ltd., Udaipur (Rajasthan). It is also evident from the relevant records that the entire transaction for the purchase of the `Suraj Brand N.P.K.' from the said firm and its utilisation in the manufacture of HARABAHAR was fraudulent and a conspiracy for wrongful gain to M/s Rajasthan Multi Fertiliser Pvt. Ltd. and erstwhile Chairman of BISCOMAUN, Sri Tapeshwar Singh and some officers responsible for the purchase of said sub-standard fertiliser and wrongful loss to the institution as well as the farmers of the State of Bihar". The facts in brief are as follows:

The said firm M/s Rajasthan Multi Fertilisers Pvt. Ltd. wrote a letter to the Chairman, BISCOMAUN enclosing its previous letter to the Managing Director, BISCOMAUN , stating therein that they were manufacturing fertilisers under the brand name of `Suraj Brand N.P.K.' (15:15:72) mixture fertiliser and they should be favored with orders for supply of the same to BISCOMAUN. They quoted the selling rate as Rs.2550 per M.T. plus taxes. The letter was not received in the normal course in the office, but was handed over direct to the then Chairman. It is also to be noted that the said letter was not in response to any advertisement of BISCOMAUN inviting offers.

When reports of the the Chemical analysis by the State Laboratory started coming in and it was found that the said fertiliser was spurious and sub-standard, the then Management of Biscomaun made a conspiracy to consume the spurious fertiliser instead of returning it to the manufacturer and claiming back the money paid.

It has been clarified above that as per the terms of the purchase, the entire fertiliser of Suraj Brand ought to have been returned to the company and refund taken. Instead of this, in order to cause wrongful gain to the company and wrongful loss to Biscomaun and the then Management, as well as to remove the evidence of the stock of spurious fertilisers, the then Management of Biscomaun took a decision to reprocess old stock of fertiliser in the two factories of Biscomaun at Tilrath and Jasidih. It was proposed to the Board that these fertilisers in the stock of Biscomaun depot, which were very old and difficult to sell should be used in these two factories for manufacture of Harabahar. This proposal was put up to the Board on March, 1987. The Board approved this proposal.

Since my learned brother stated the facts in extenso, they bear no repetition. To focus on the questions stemmed from the findings of the High Court, I state only few facts thus:
The Bihar State Co-operative Marketing Union (for short `the BISCOMAUN') is the sole purchaser and distributor of fertilizers to the farmers in the State through its depots situated at different parts of the State. When the BISCOMAUN was at the brink of liquidation due to mismanagement, the State Government superseded its Board of Directors on July 30, 1988 and appointed R.K. Singh, I.A.S. as its Administrator and Managing director. During the course of the discharge of his duties, he noted financial irregularities committed by P.P. Sharma, the then Managing Director (the first respondent), Ganesh Dutt Misra, the then ADvisor (the second respondent) and Tapeshwar Singh, the then Chairman of BISCOMAUN and laid the information before the Station House Officer, Gandhi Maidan Police Station, Patna on September 1, 1988, shorn of the details the substratum of the accusations made against them is that they conspired with the Rajasthan multi Fertilizers Private Limited (for short `the Company') through its partners named therein to cause wrongful gain to the Company and wrongful loss to the BISCOMAUN and the farmers to purchase substandard fertilizers by name `Suraj' brand. In furtherance thereof the Chairman received applications directly from the Company and without routing through the official channel and without inviting tenders from open market, the contract was finalised. The prevailing retail price of `Suraj' brand of the Company itself was Rs.2,000 per M.T., but contracted to purchase at Rs.2,509.60 per M.T. In terms of the contract the Company has to supply granulated mixed fertilizers with full bags, which would be subjected to chemical analysis in the laboratory either of the BISCOMAUN or the State of Central Government. If the fertilizers were found to be of substandard, the same were to be taken return of at the Company's expenses. On test if fertilizers were found to be standard one, payment was to be made at a specified rate within 30 days. Sharma placed orders with the Company to supply 2500 M.Ts. of fertilizers. Fertilizers' Inspectors were to have the fertilizers tested in terms of the Fertilizers Control Order, Instead, the agent of the Company had taken the Fertilizers for chemical examination in Rajendra Agricultural University, Bihar. The report said to have been given by Dr. S.N. Jha, Associate Professor of Soil Science of the University, was fabricated by one S.N. Sahoo, Assistant in the department who is one of the accused; payments were made in undue haste and further order to supply of 450 M.Ts. was made by G.D. Mishra. Only 459 M.Ts in total was sold out. When the reports were being received from depots that the fertilizers supplied were substandard and spurious and the bags do not contain the full weight, instead of returning the stock, a resolution was obtained from the Managing Committee to convert unsold old stock as HARBAHAR. When a specific request for conversion of the stock supplied by the Company for conversion as HARBAHAR was turned out by the Managing Committee, yet the resolution was fraudulently used to destroy the evidence of supply of substandard and spurious fertilizers and converted into Harbahar and fabricated the records in furtherance thereof. These in substance are the accusations punishable under ss. 409, 420, 467, 468 and 471 read with s. 120B of the Indian Penal Code and s. 7 of the Essential Commodities Act and the Fertilizer Control Order.