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"That Shri R. Venkatesan the then Chairman & Managing Director, Rashtriya Chemical Fertilizers Ltd. Chembur, Mumbai, while functioning as such during 1987-1991 abused his official position in as much as he is in conspiracy with S/Shri Surendra Mohan Dingra, Dy. General Manager, RCF, Chembur, Mumbai, Roop Kishore Dargar, Chief Marketing Manager, RCF, Chembur, Mumbai, Kuldip Narayan, the then General Manager, RCF, Chembur, Mumbai and Shri Pradip Ramrakhiani, Partner of M/s. Pradip & Co., Mumbai and Prop. of M/s. Raja Chemical Corporation, Mumbai cheated the Rashtriya Chemical & Fertilizers Ltd., Chembur, Mumbai, by providing unauthorized supply of Sodium Nitrate and Sodium Nitrite to the said Shri Pradip Ramrakhiani on clean credit basis contrary to the policy of the RCF of "Pay Cash - Carry Basis". Thus, causing wrongful loss to the R.C.F. Ltd., Chembur, Mumbai, and corresponding gain to the said Shri Pradip Ramrakhiani.

That Sodium Nitrate (NaNO3) and Sodium Nitrite (NaNO2) are the by products of R.C.F. Ltd., and these by products are sold by the RCF Ltd., Mumbai to various firms/companies on cash or Bank/Collateral basis. These by-products are used by glass industries, fire-work manufacturers, in explosives, fertilizers and in pharmaceutical items.

That the said Shri Pradip Ramrakhiani, Partner of M/s. Raja Chemical Corpn. and Prop. of M/s. Pradip & Co., Mumbai is dealing in the aforesaid chemicals items since 1985 and initially he was purchasing the aforesaid chemical material from the R.C.F. Ltd., Chembur, Mumbai on cash payment and from 1986 he was purchasing the said material from the RCF Ltd. Mumbai on the credit basis against the bank guarantee.

That in pursuance of the letter dated 7.11.1998 of the RCF Ltd., Chembur, Mumbai, addressed to M/s. Raja Chemical Corporation asking them to enter into a long term agreement for sale of Sodium Nitrate the said Shri Pradip Ramrakhiani on 26.11.1985 asked the RCF Ltd., Chembur, Mumbai to give him clean credit facility to the tune of Rs. 20 lakhs approximately and promised the RCF Ltd., Mumbai to lift 100 MTs of the Sodium Nitrate every month and that the said Shri Pradip Ramrakhiani further expressed that it was not possible to take the aforesaid chemical material on cash and carry basis and he desired to lift the said chemical material on credit of 60 days by furnishing bank guarantee of Rs. 5 lakhs.

3. The Petitioner, however, filed application before the Special Judge for C.B.I., Greater Mumbai, where the criminal case is pending for trial, for discharge. The first contention raised on behalf of the Petitioner is that the Court cannot take cognisance as against the Petitioner for want of sanction, much less valid sanction. It was stated that Charge sheet was filed against the Petitioner on 30th September 1998, on which date, however, the Petitioner continued to be in the employment of RCF, for which reason the Sanction to prosecute the Petitioner was pre-requisite to take cognisance of the alleged offence against the Petitioner. According to the Petitioner, the material produced by the prosecution in support of the allegation, even if accepted as it is, will not indicate the complicity of the Petitioner in the commission of the crime. Besides, no offence is made out as against the Petitioner, for which the Petitioner needs to be tried. The Petitioner also relied on documents to support his claim that the Petitioner has been falsely implicated inasmuch as the Petitioner had merely given effect to the prevailing policy/scheme of the RCF and had not deviated in any manner. It is his case that, in fact, the Board of Directors had occasion to consider the entire matter and at least on three occasions, they declined to grant sanction to prosecute the Petitioner, on the finding that it was the practice to offer credit to the parties, which was in vogue. The Board of RCF was of the opinion that the Petitioner had facilitated recovery of outstanding amount substantially. Moreover, the Note of the Chairman-cum-Managing Director, as well as the opinion of the Board, would clearly indicate that the decisions taken by the Petitioner were in the realm of commercial decisions in the best interest of the Company at the relevant time. Relying on the said opinion, it is the case of the Petitioner that the prosecution has not made out even a case of suspicion, much less grave suspicion against the Petitioner, so as to warrant framing of charge and to try the Petitioner for the alleged offence. It was also argued that although other officers were also involved along with the Petitioner in the decision making process and offering facility to the private party, however the Petitioner was singled out and being persecuted. It is the case of the Petitioner that as officials superior to the petitioner and the members of the board of directors, who were supporting the claim of the petitioner, were not arraigned as accused, the prosecution theory of conspiracy ought to fail. It is the case of the petitioner that if the act of the petitioner was one which was a commercial decision taken at the relevant time in the best interest of the company and which decision has been accepted even by the board of directors of RCF, there can be no question of the petitioner being party to criminal conspiracy. It is the case of the petitioner that the petitioner has not concealed any relevant fact while approving the proposal to offer facility to the private party and the decision to do so was a conscious one with knowledge about the outstanding amounts in respect of the supplies already made at the instance of that party. According to the petitioner, therefore, there was no tangible material to proceed against the petitioner in respect of the alleged offence.