M. S. A. Siddiqui, J ( 1 ) THE challenge in these petitions is to the order dated 7. 11. 1998 passed by thespecial Judge. New Delhi In CC No. 1998 directing framing of charges under Section. s420/409/ 120-BIPC against the petitioners. These petitions are being disposed of bythis common order. ( 2 ) THE facts of the case have been detailed in the impugned order and it is notnecessary for. me to repeat the same over and again, yet a brief sketch of it is necessaryto appreciate the contentions raised by the parties. In 1995, the accused personsentered into a criminal conspiracy amongst themselves the object of which was todefraud the National Fertilizers Limited (for short the NFL) and swindle a. whoppingsum of Rs. l33 crores. In furtherance of the said conspiracy, a contract for the supplyof 200000 M. T. urea worth 38 million US dollars was awarded to a Turkish companyknown as M/s. KARSAN and the entire amount was paid to the said company withoutgetting even an ounce of urea in return. Out of the defrauded amount, the accusedtuncay Alankus paid substantial amount to the accused persons as illegal kickbacks. When the print media highlighted the large dimensions of the said fraud, the matterwas placed before the Board of the NFL at its emergency meeting held on 27. 3. 1996. The Board directed the E. D. (Vigilance) to conduct an enquiry into the matter. Onreceipt of the inquiry report, Shri K. K. Jaiswal, Joint Secretary, Ministry of Chemicalsand Fertilisers, Government of India, sent a written report to the Director, CBI, on thebasis of which the FIR was registered on 28. 5. 1996. Investigation pursuant thereto culminated in submission of a charge-sheet under Sections 120- B/409/420 Indian Penal Code read withsection 13 (2)/13 (1) (c) and (d) of the Prevention of Corruption Act against the accused persons. The Special Judge took cognizance upon the charge sheet and issuedprocesses against the petitioners. After entering appearance they agitated variousgrounds to contend that there was no material whatsoever to frame charges againstthem. The Special Judge, however, by a detailed and well reasoned order rejected allthose contentions and passed the impugned order deciding to frame the impugnedcharges and try the petitioners. The Special Judge took cognizance upon the charge sheet and issuedprocesses against the petitioners. After entering appearance they agitated variousgrounds to contend that there was no material whatsoever to frame charges againstthem. The Special Judge, however, by a detailed and well reasoned order rejected allthose contentions and passed the impugned order deciding to frame the impugnedcharges and try the petitioners. ( 3 ) LEARNED Senior Counsel appearing on behalf of the petitioners contended thatthe materials collected by the prosecuting agency do not constitute any offence againstthe petitioners and the learned Special Judge has committed a patent illegality inframing the impugned charges against them which has resulted in flagrant miscarriageofjustice. ( 4 ) AT the outset I must make it clear that at this stage it is impermissible for thiscourt to embark upon full fledged and full dressed appreciation of evidence collectedby the prosecuting agency like a regular appellate court and on such appreciation ofevidence to quash the impugned charges on the score of absence of clear and cogentevidence to sustain conviction of the petitioners. This being the initial stage of trial, thecourt is not called upon to decide whether the materials collected by the prosecutingagency provide sufficient ground for conviction of the accused or whether the trial issure to culminate or end in conviction of the accused persons. What is to be seen iswhether there is a strong suspicion which leads to the court to form a presumptiveopinion as to the existence of the factual ingredients constituting the offences alleged. At this stage, the Court is required to evaluate the materials collected by the prosecuting agency with a view to finding out if the facts emerging therefrom taken at their facevalue constitute an offence against the accused. The court may for this limited purposesift the evidence. (Niranjan Singh Karam Singh Punjabi v. Jitendra Bhimraj Bijja andothers, AIR 1990 SC 1962 ). This, however, does not mean that the Judge should makea roving enquiry into the pros and cons of the matter and weigh the evidence as if hewas conducting a trial. (Union of India v. Prafulla Kumar Sanal and Another AIR 1979sc 366 and State of M. P. v. S. B. Johari and Others, JT 2000 (1) SC 169 ). At this stage,as was pointed out by the Supreme Court in Supdt. (Union of India v. Prafulla Kumar Sanal and Another AIR 1979sc 366 and State of M. P. v. S. B. Johari and Others, JT 2000 (1) SC 169 ). At this stage,as was pointed out by the Supreme Court in Supdt. And Remembrancer Legal Affairs v. Anil Kumar AIR 1980, SC 52, the standard of test, proof and judgment which is to beapplied finally before finding the accused quilty or otherwise, is not exactly to be applied. ( 5 ) IN State of Maharashtra etc. v. Somnath Thapa etc. etc. JT 1996 (4) SC 615, it washeld that: "if on the basis of materials on record, a court could come to the conclusionthat commission of the offence is a probable consequence, acase of framingof charge exists. To put it differently, if the Court were to think that the accused might have committed the offence it can frame the charge, though forconviction the conclusion is required to be that the accused has committedthe offence. It is apparent that at the stage of framing of charge, probativevalue of the materials on record cannot be gone into: the materials broughton record by the prosecution has to be accepted as true at that stage. " ( 6 ) IN Umar Abdula sakoor Sorathia v. Intelligence Office, Narcotic Control Bureau. JT 1999 (5) SC 394, it was held that : "it is well settled that at the stage of framing charge, the Court is not expected to go deep into the probative value of the materials on record. If onthe basis of materials on record the Court could come to the conclusion thatthe accused would have committed the offence the Court is obliged toframe the charge and proceed to the trial. "rnow in the instant case, at that initial stage, it was apparent from the materialsbefore the Special Judge, that the basic facts proposed to be proved by the prosecu-tion against the accused persons were as follows:i) that the accused Tuncay Alankus was the President and the accusedcihan Karanchi was the Vice President of the Turkish Company, known asm/s. KARSAN, which was a tiny company having a share capital of 10 million Turkish lira equivalent to USD 200. It was listed in the Chamber ofcommerce, Ankara (Turkey) as tour operators;ii) that the said company was neither the manufacturer nor producer of theurea and it had no previous dealing with the Government of India;iii) that no inquiry was made by officials of the NFL about the, antecedentsand status of the said company or its experience of trade in fertilizers;iv) that M/s. Sai Krishna Impex Hyderabad was the authorised Indian agentof M/s. KARSAN;v) that the accused M. Sambasiva Rao Started M/s. Sai Krishna Impex withthe accused D. Mallesham Goud, a small time businessman and former arrack contractor, as partner;328vi) that the accused B. Sanjeeva Rao is a close relative of Shri P. V. Narsimha Rao, the then Prime Minister of India;vii) that the accused P. C. Yadav is the son of Shri Ram Lakhan Singhyadav. the then Union Minister of Chemicals and Fertilizers;viii) that the accused C. K. Ramakrishnan was the Managing Director andthe accused D. S. Kanwar was the Executive Director (MKG.) of the NFL, acompany of the Government of India;ix) that in the month of November, 1. 994, the NFL was made a co-canalisingagency for import of urea on behalf of the Ministry of Fertilizers, Government of India;x) that in November, 1994, the Board of Directors of the NFL, approved theprocedure for import of urea by floating global lenders. According to thesaid procedure, tenderers were required to deposit earnest money in accordance with the terms and conditions of the lender notice. Manufacturersof urea were exempted from depositing the earnest money. The successfulbidders were required to furnish performance guarantee bonds equivalentto two per cent of the total value of the contract and proof of stock duly attested by the prime bank/chamber of commerce of the country concerned. In case of breach of the contract, the amount of performance guaranteebond was required to be forfeited. It was also envisaged that the successfulbidders supplying the urea were to gel payment by way of letter of creditsafeguarding the interests of both the buyer and the seller. In case of breach of the contract, the amount of performance guaranteebond was required to be forfeited. It was also envisaged that the successfulbidders supplying the urea were to gel payment by way of letter of creditsafeguarding the interests of both the buyer and the seller. There was noprovision to award contract for import of urea on single offer basis;xi) that the Managing Director of the NFL was not authorised by the Boardof Directors to enter into a contract with any foreign bidder or company forimport of urea;xii) lhal the accused M. Sambasiva Rao managed to become a confident ofthe accused B. Sanjeeva Rao, who had provided him with connections, heneeded;xiii) that in 1995, the accused M. Sambasiva Rao, B. Sanjeeva Rao, D. Mallesham Goud and others entered into a conspiracy among themselves, theobject of which was to persuade the politicians and public servants to awardcontracts to different foreign bidders with the motive of getting illegal kickbacks from them;xiv) lhal in furtherance of the said conspiracy. the accused B. Sanjeeva Raocame to Delhi along with the accused M. Sambasiva Rao and D. Malleshamgoud and introduced the accused M. Sambasiva Rao to the accused C. K. Ramakrishnan in mid 1995 for giving him contracts for supply of urea. Thereafter, the accused M. Sambasive Rao was awarded contracts for import of urea on behalf of M/s. Amartek International, USA, M/s. Inlertrade,denmark and M/s. Bulsigma, Balgaria in respect of tenders-urea 3, urea-4and urea-5, respectively, which were floated by the NFL:xv) lhal the accused M. Sambasiva Rao could not supply urea to the NFLagainst any of the aforesaid contracts;329xvi) that in the month of June. 1995, the accused M. Sambasiva Rao submitted a tender on behalf of M/s. Surpass Builders (PVT) Ltd. in respect ofthe tender urea-4. The said company was managed and controlled by Nuthisrimanarayan;,\vii) that the accused M. Sambasiva Rao invited A. E. Pintoo of M/s. Brasiltrading Company, London to visit India and to bring certain documentsrelating to the offer given by M/s. KARSAN for supply of 200000 MT ofurea;xviii) that in the month of July, 1995, A. E. Pintoo visited New Delhi and healong with the accused M. Sambasiva Rao contacted the accused C. K. Ramakrishnan and D. S. Kanwar. They discussed about the offer of M/s. KARSAN for supply of 200000 MT of urea at the rate of USD 190 per MTon CIF basis against blocked fund method;xix) that M/s. KARSAN made their first offer for supply of urea in July,1995 responding to a tender floated by the NFL;xx) that the said tender, among other terms, mandated that delivery period (s) quoted should be Firm and shall be treated as an essence of the contractand the agent s commissions should be transparent and would be paid in Indian currency;xxi) that on 27/07/1995, a contract bearing No. KARUREA-097/1995for the supply of 200000 MT urea was unauthorisedly executed by the accused D. S. Kanwar on behalf of the NFL in favour of M/s. KARSAN Ltd;xxii) that the contract dated 27. 7. 1995 provided that the payment, less agency commission, if any, shall be made through an irrevocable letter of credit. It further provided that payment shall be made on arrival of the urea at thedischarge port;xxiii) that the said contract was deliberately not acted upon and all relevantpapers pertaining thereto were dishonestly removed by the accused C. K. Ramakrishnan and D. S. Kanwar from the records of the NFL;xxiv) that a contract was REFERRED TO to the Board of the NFL at its meeting onseptember 1. 8, 1:995. Though there was no budget provision tor fertiliser imports, the minutes of the Board meeting recorded "these cases need not beput upto the Board and may be processed as in the case of other purchases". This provided a handle to the accused C. K. . Ramakrishnan and D. S. Kanwarfor holding negotiations with M/s. KARSAN and the KARSAN seized thisopportunity, to defraud the NFL and swindle the money;xxv) that some of the terms and conditions of the contract dated 27. 7. 1995regarding payment of consideration and furnishing of performance guarantee bond were unfavourable to the common design of the conspirators asthey were interested in swindling the money, the accused C. K-Ramakrishnan and D. S. Kanwar, therefore, managed to put a fresh contract in place ofthe contract dated 27. 7. 1995 making a staggering commitment for transferof 100% cash pre-payment of the total contract value to M/s. KARSAN;330 xxvi) that the accused B. Sanjeeva Rao and Prakash Chand Yadav were involved to clinch the said deal and, on 9. 11. 7. 1995 making a staggering commitment for transferof 100% cash pre-payment of the total contract value to M/s. KARSAN;330 xxvi) that the accused B. Sanjeeva Rao and Prakash Chand Yadav were involved to clinch the said deal and, on 9. 11. 1995 M/s. KARSAN was awardeda contract for import of 2 million MT urea at the rate of USD 190 per MTwhich was far lower than the international market bench mark of US dollars240 to 245;xxvii) that on 2/11/1995, i. e. before signing the said contract, thefirst instalment of I per cent of the advance payment amounting to 3. 8 million US dollars, was remitted by the State. Bank of India on the conditionthat either the NFL should provide a bank guarantee or obtain waiver fromthe Reserve Bank of India;xxviii) that the accused Tuncay Alankus, instead of furnishing an insurancepolicy covering the risk of non-delivery and non-performance, furnished amaritime transport risk cover dated 6. 11. 1995;xxix) that on 10. 11. 1995 the State Bank of india wrote to the Reserve Bankof India intimating about remittance of the First instalment of I per cent ofthe advance payment. The letter further sought approval of the Reservebank of India for remitting the balance 99% of the advance on the basis ofthe insurance cover to be provided by the NFL. This letter was received bythe Reserve Bank of India on 14. 11. 1995;xxx) that without awaiting the response of the Reserve Bank of India,balance 99% of the advance amounting to 37. 62 million US dollars wasremitted to the KARSAN s bank on 14. 11. 1995 itself. Thus the accusedo. K. . Ramakrishnan and D. S. Kanwar prevailed upon the Chief Manager,slate Bank of India, South Extension branch, New Delhi to remit the saidamount in foreign exchange in contravention of the Exchange Controlmanual;xxxi) that on 14. 11. 1995, the accused C. K. Ramakrishnan and D. S. Kanwargot remitted the balance amount of the contract i. e. 37. 62 million US dollarto the KARSAN s account in the Pamuk Bank, Ankara (Turkey ). It appearsthat on that day, M/s. KARSANS did not have any account in the said bankand so the NFL received a fax message from the accused Tuncay Alankusrequesting to divert the said amount to the KARSAN s account No. 1051467 of the Indo-suez Bank, Geneva (Switzerland);xxxii) that on 14. 11. It appearsthat on that day, M/s. KARSANS did not have any account in the said bankand so the NFL received a fax message from the accused Tuncay Alankusrequesting to divert the said amount to the KARSAN s account No. 1051467 of the Indo-suez Bank, Geneva (Switzerland);xxxii) that on 14. 11. 1995 at about II P. M. the Chief Manager of the Statebank of India (South Extension, Branch) Mr. K. L. Batra was called at theoffice at the NFL, where the accused D. S. Kanwar and other officials. of thenfl were present and he was asked to advise the State Bank of India sbranch at New York to cancel the remittance of the amount to the Pamukbank and to divert it to the Indo-Suez Bank Geneva (Switzerland ). Accordingly, a fax message was sent to the Stale Bank of India s New Yorkbranch for diverting the money to the lndo-Sue/ Bank at Geneva;xxxiii) that on 15. 11. 1995, the money (37. 62 million US dollars) was remittedto the Indo-Suez Bank, Geneva (Switzerland ). The said bank made enquiries from the MHK Marine London to find out whether the insurancecover note dated 6. 11. 1995 covered the risk of non-performance and nondelivery as mentioned in the contract. On finding that said insurance coverdid not cover the risk of non-performance and non-delivery, the said bankdeclined to accept the remittance and returned the money to the concernedbranch of the State Bank of India;xxxiv) that on 22. 11. 1995 the accused Tuncay Alankus opened three accounts in the Pictet Bank at Geneva. Account No. 91923 was opened in thecorporate name of M/s. KARSAN and the accounts No. 91924 and 91925were opened in the name of Cihan Karanci and Tuncay Alankus respectively;xxxv) that on 23. 11. 1995, the accused Tuncay Alankus addressed a letter tothe NFL requesting for diversion of the said money to the Pictet Bankgeneva;xxxvi) that the accused M. Sambasiva Rao also sent a letter to the accusedd. S. Kanwar for the said purpose as he was in constant touch with the accused Tuncay Alankus and Cihan Karanci;xxxvii) that on 28. 11. 1995, the said money was diverted to the Pictet Bank,geneva and receipt thereof was confirmed by the bank vide its letter dated29. 11. S. Kanwar for the said purpose as he was in constant touch with the accused Tuncay Alankus and Cihan Karanci;xxxvii) that on 28. 11. 1995, the said money was diverted to the Pictet Bank,geneva and receipt thereof was confirmed by the bank vide its letter dated29. 11. 1995;xxxviii) that the accused D. S. Kanwar and C. K. Ramakrishnan informed theaccused M. Sambasiva Rao and B. Sanjeeva Rao about the receipt of thesaid money by the Pictel Bank, Geneva;xxxix) that the whole deal was finalised with M/s. KARSAN in an unholyhaste and on 14. 11. 1995 the accused C. K. Ramakrishnan and D. S. Kanwar,blithely released payment of balance amount of the contract in violation ofthe established procedure;xl) That on 30. 11. 1995, the accused Tuncay Alankus transferred/remitteddifferent amounts to the accounts of following persons including himself :-a) US $ 28. 10 million to his personal account No. 91925 with Pictet Bank,geneva. Switzerland. b) US $ 1. 10 million to the account No. 91924 of Chihan Karanci with Picketbank, Geneva, Switzerland. e) US $ 4. 00 million to the account of M/s. Edible Food Stuff Trading,dubai. d) US $ 2. 00 million to the account of M/s. Malyn Holdings Ltd. USAe) US $ 3,42,000 to the account of Sh. P. Papaghikas in Greece. f) US $ 2,00,000 to the account of Shri M. Sambasiva Rao in Hyderabad (India ). xli) that the sum of 4 million US dollars, remitted by the accused Tuncayalankus to the account of M/s. Edible Food Stuff Trading, Dubai wasbrought to India through hawala channels with the help of the accused D. Mallesham Gaud:332 that out of the said amount, the accused M. Sambasiva Rao paid Rs. 70lakhs to the accused B. Sanjeeva Rao and Rs. 60 lakhs to the accused Mallesham Gaud; that in addition, the accused D. Mallesham Gaud issued one cheque ofrs. 12 lakh and two cheques of Rs. 10 lakhs each from the account of M/s. Marg Leasing and Finance (Pvt.) Ltd, Hyderabad with the Vijay Bank infavour of (i) M/s. Madicon Marketing (Pvt.) Ltd, Hyderabad, (ii) M/s. S. R. R. Finance and Investment (Pvt.) Ltd, Hyderabad, (iii) M/s. Sai Bharatfinance (Pvt.) Ltd, Hyderabad, respectively, which were owned/controlledby the accused B. Sanjeeva Rao and his family members. Thus, the accusedb. Sanjeeva Rao got his share of Rs. 1. Thus, the accusedb. Sanjeeva Rao got his share of Rs. 1. 02 crores out to the defraudedamount;xliv) that the accused M. Sambasiva Rao always kept the accused P. C. Yadav informed about developments of the deal in question either personally or on telephone; that the accused Prakash Chand Yadav directed,the accused D. S. Kanwar to gel US $ 2 million remitted through the accused M. Sambasiva Raoto the account No. 464411 of M/s. Pennycairn Holdings with Rea Brothersof New York, the details of which were provided to the accused M. Sambasiva Rao through the accused D. S. Kanwar. Accordingly, the accusedd. S. Kanwar got the said amount remitted to the said account through theaccused M. Sambasiva Rao. Thus the accused Prakash Chand Yadav alsogot his share of 2 million US dollars out of the defrauded amount; that blaming delivery delays on a harsh winter in the CIS countries,tuncay Alankus kept on assuring the NFL for delivery of the urea, but hisactions belied his words; that on 1. 6. 1996, the accused M. Sambasiva Rao, C. K. Ramakrishnanand D. S. Kanwar were arrested. After arrest of the said accused persons,pressure was mounted on the accused Tuncay Alankus to dispatch someurea as a result whereof 9,000 MT urea was shipped by the Tuncay Alankus; that on 1. 7. 1996 the shipped urea arrived al the Bhavnagar port (Gujrat) which was rejected as it did not conform to the standard prescribedunder the contract; that on 6. 8. 1996, the accused D. M. Gaud made aconfessional statement under Section 40 of the Foreign Exchange Regulation Act (for short"the FERA") about the alleged criminal conspiracy and receipt of illegalkickbacks from M/s. KARSAN through Hawala channels and its disbursement among the conspirators; ( 7 ) ON the basis of the positive and negative facts mentioned above, in conjunctionwith other subsidiary facts, appearing expressly or by necessary implication, from thematerials collected by the prosecuting agency, the learned Special Judge concludedthat there were grounds for presuming that the petitioners had committed the allegedoffences. ( 8 ) ONE of the offences alleged against all the accused persons is criminal conspiracyunder Section 120-B of the Indian Penal Code. ( 8 ) ONE of the offences alleged against all the accused persons is criminal conspiracyunder Section 120-B of the Indian Penal Code. The essential ingredients of the offenceof criminal conspiracy are: (i) if a person agrees with any other person or persons thata course of conduct shall be pursued; (ii) which will necessarily amount to/or involvethe commission of any offence or offences by one or more of the parlies to the agreement. (iii) if the agreement is carried out in accordance with a criminal object, whichmay be either the ultimate aim of the agreement or may constitute the means, or oneof the means by which that aim is to be accomplished. It is not necessary that eachconspirator must know all the details of the agreement nor be a participant at everystage. What is important is to resist the temptation to introduce into this. simple concept ideas derived from the civil law of contract. Any number of persons may agreethat a course of conduct shall be pursued without undertaking any contractual liability. The agreed course of conduct may be simple or an elaborate one and may involvethe participation of two or any large number of persons who may have agreed to play avariety of roles in the course of conduct agreed. Here what is important to note is thatit is not necessary that more than one of the participants in the agreed course of conduct shall commit a substantive offence. It is, of course, necessary that any party to theagreement shall have assented to play his art in the agreed course of conduct, however, innocent in itself, knowing that the part to be played by one or more of the otherswill amount lo/or involve the commission of an offence. Viscount Dihorne said (1974)3 All ER 1032 at 1038 "one must not confuse the object of a conspiracy with the meansby which it is intended to be carried out. " The necessary mens rea of the crime is, inmy opinion, established if it is shown that the accused, when he entered into the agreement, intended to play some part in the agreed course of conduct in furtherance of thecriminal object which the agreed course of conduct was intended to achieve. Nothingless will suffice; nothing more is required. " The necessary mens rea of the crime is, inmy opinion, established if it is shown that the accused, when he entered into the agreement, intended to play some part in the agreed course of conduct in furtherance of thecriminal object which the agreed course of conduct was intended to achieve. Nothingless will suffice; nothing more is required. In Ajay Aggarwal v. Union of India andothers, ( 1993) 3 SCC 609 it was held that a conspiracy is a continuing offence and continues to subsist and committed wherever one of the conspirators does an act, or seriesof acts. So long as its performance, continues, it is a continuing offence till it is executed or rescinded or frustrated by choice or necessity. ( 9 ) IN these days of highly organised crime the most serious statutory conspiracieswill frequently involve an elaborate and complex agreed course of conduct in whichmany will consent to play necessary but subordinate roles, not involving them in anydirect participation in the commission of the offence or offences at the centre of theconspiracy. It is a mailer of common experience in the criminal Courts that terms ofa criminal conspiracy are hardly ever susceptible of proof. The evidence from which acourt may infer a criminal conspiracy is almost invariably to be found in the conductof the parties. In Shivanarayan Laxminarayan Joshi and Others v. State of Maharushtra. and Others AIR 1980 SC 439 , it was held that conspiracy is always hatched in secrecyand it is impossible to adduce direct evidence of- the same. The offence can he onlyproved largely from the inferences drawn from acts or illegal omissions committed bythe conspirators in pursuance of a common design. Thus, conspiracy is usually provedby what are called overt acts, being acts from which an antecedent conspiracy is to beinferred. When and where the conspiracy of occurs is often unknown and seldomrelevant. In the instant case it is impossible to establish when or where the initialagreement was made between the conspirators. The very existence of the agreementcan only be inferred from the facts and circumstances of the present case. ( 10 ) THE real question must in each case be what was the true object of the agreemententered into by the conspirators. In the instant case, it is the case of the prosecutionthat the conspiracy was hatched up to defraud the NFL and swindle a sum of Rs. ( 10 ) THE real question must in each case be what was the true object of the agreemententered into by the conspirators. In the instant case, it is the case of the prosecutionthat the conspiracy was hatched up to defraud the NFL and swindle a sum of Rs. 133crores and to receive illegal kickbacks through hawala channels and other sources. Therefore, I have to ascertain whether there is a prima facie evidence affording areasonable ground to believe about existence of the said conspiracy. I think that thereare one or two things that can be said with confidence about the meaning of the worddefraud . It requires a person as its object: that is, defrauding involves doing something to someone. Although in the nature of things it is almost invariably associatedwith the obtaining of an advantage for the person who commits the fraud, it is the effect upon the person who is the object of fraud that ultimately determines its meaning. In the instant case it is alleged that a fraud costing a whopping sum of Rs. 133 croreswas perpetrated by the accused persons after hatching a criminal conspiracy. The accused C. K. Ramakrishnan and D. S. Kanwar, being the Managing Director and Execulive Director of the NFL respectively, had dominion and control over the assets of thecompany. It is now well settled that a director is not only an agent of the company butis in position of a trustee. A director being a trustee of the assets of the company,which have come into his hand. has dominion and control over the same (R. K. Dalmiav. The Delhi Administration, AIR 1962 SC 1821 , Shivnarayan Laxmnarayan Joshi andothers v. State of Maharashtra and Others, AIR 1980 SC 439 ). ( 11 ) IN R. K. Dalmia s case (supra), the Supreme Court has held that the word property is wide enough to include a chose-in- action. In the instani case. theprosecuting agency has collected materials to show that the accused C. K. Ramaknshnan and D. S. Kanwar had sufficient dominion and control over the money in questionand through the conspiracy hatched by them with I heir co-conspirators (co-accusedpersons) they were able to defraud the NFL and deprive it of the sum of Rs. 133 crores. In the instani case. theprosecuting agency has collected materials to show that the accused C. K. Ramaknshnan and D. S. Kanwar had sufficient dominion and control over the money in questionand through the conspiracy hatched by them with I heir co-conspirators (co-accusedpersons) they were able to defraud the NFL and deprive it of the sum of Rs. 133 crores. ( 12 ) IT is undisputed that the accused Tuncay Alankus was the presidcnt and the accused Cihan Karanci was the Vice-President of the Turkish company known as M/s. KARSAN. This company was a tiny company having a share capital of 10 millionturkish Lira equivalent to 200 USD. It was listed in the Chamber of Commerce,ankara (Turkey) as tour operators. M/s. KARSANs were neither the manufacturersnor producers of urea and they had no previous dealing with the Government of India. There is documentary evidence to show that in the month of November, 1994 the NFLwas made a co- canalising agency for import of urea on behalf of the Ministry of Fertilisers. Government of India. The accused M. Sambasiva Rao started M/s. Sai Krishnaimpex with the accused D. M. Gaud, a small time business man and former arrack contractor. as partner. The accused B. Sanjeeva Rao is a close relative of Shri P. V. Narsimha Rao, the former Prime Minister of India. The accused M. Sambasiva Raomanaged to become a confident of the accused B. Sanjeeva Rao, who had providedhim with connections, he needed. The circumstantial evidence on record also suggeststhat the accused P. C. Yadav son of Shri Ram Lakhan Singh Yadav, the then Unionminister for Chemicals and Fertilizers, was also involved to ensure that the KARSAN NFL deal regarding import of the urea in question went through without trouble. ( 13 ) THE prosecuting agency has also collected evidence to show that the KARSANmade its First offer for supply of urea in July, 1995 responding to. a tender floated bythe NFL. One of the terms of the said tender mandated that delivery period (s) quotedshould be firm and the agent s commission should be transparent and would be paid inindian currency. The case diary statement of Anil Sharma read along with the documents on record (Vol 11 of the paper book of the CBI) clearly shows that on 27. 7. 1995,a contract for supply 200000 MT urea @ 190 USD per MT was awarded to M/s. KARSAN. The case diary statement of Anil Sharma read along with the documents on record (Vol 11 of the paper book of the CBI) clearly shows that on 27. 7. 1995,a contract for supply 200000 MT urea @ 190 USD per MT was awarded to M/s. KARSAN. The said contract provided that the total contract value, (USD 38,00,000) will beplaced in a Special Account at buyer s bank by the buyer and a letter of confirmationwill be designed and transferred to the seller s bank by the buyer s bank staling thatthe funds related with the given transaction code have already b6en placed in an account at the buyer s bank and will be released to the seller s order at the end of thetransaction. This contract was unauthorizedly executed by the accused D. S. Kanwaron behalf of the NFL in favour of M/s. KARSAN. The prosecution has placed onrecord the minutes of the meeting of the Board of Directors of the NFL to show thateven the Managing Director of the NFL was not authorised by the Board to enter intoa contract with any foreign bidder or company for import of urea. The correspondence between the accused C. K. Ramakrishnan and Shri N. K. Gupta, the then Executive Director (MKG and P and A) shows that all the relevant documents leading losigning of the said contract was surreptitiously removed from the office of the NFL. However, a copy of the said contract was supplied by the accused Tuncay Alankus. Learned Additional Solicitor General contended that the said contract was deliberately not acted upon by the parlies as the terms and conditions there of regarding payment of the total value of the contract were not favourable to the -common design ofthe conspirators, whose only aim was to defraud the NFL and swindle the money. ( 14 ) AT this juncture, it is worth noticing. that in the month of November, 1994, theboard of Directors of the NFL approved the procedure for import of urea by floatingglobal tenders. As per procedure, the tenderers were required to deposit earnestmoney in accordance with the terms and conditions of the tender notice, but themanufacturers of the urea were exempted from depositing the earnest money. that in the month of November, 1994, theboard of Directors of the NFL approved the procedure for import of urea by floatingglobal tenders. As per procedure, the tenderers were required to deposit earnestmoney in accordance with the terms and conditions of the tender notice, but themanufacturers of the urea were exempted from depositing the earnest money. Thesuccessful bidders were required to furnish performance guarantee bonds, equivalentto 2% of the total value of the contract and proof of stock duty attested by the primebank/chamber of commerce of the concerned country. It was also envisaged thal thesuccessful bidders supplying the urea were to gel payment by way of letter of creditsafeguarding the interests of both the buyer and seller. There was no provision loaward a contract on single offer basis. ( 15 ) IT is relevant to mention that a contract was REFERRED TO to the Board of Directors ofthe NFL at their meeting on 18/09/1995. Though there was no budgetprovision for fertiliser imports, the minutes of the Board s meeting recorded: "thesecases need not be put upto the Board and may be processed as in the case of otherpurchases. " This provided a handle to the accused C. K: Ramakrishnan and D. S. Kanwar for holding negotiations with M/s. KARSAN. M/s. KARSAN representative in india, namely, the accused M. Sambasiva Rao seized this opportunity. Shri Anil Sharma and Shri Arun Goel have stated in their case diary statements that the accused M. Sambasiva Rao was introduced to the accused C. K. Ramakrishnan by the accused B. Sanjeeva Rao and wherever the accused M. Sambasiva Rao visited the office of the ^nfl he was given V. I. P. treatment by the accused D. S. Kanwar as well as by the accused C. K. Ramakrishnan. The. case diary statement of Sahib Singh shows that duringthe relevant perfod the accused B. Sanjeeva Rao and M. Sambasiva Rao had severalmeetings with the accused C. K. Ramakrishnan. He also staled that the accusedp. C. Yadav used, to talk to the accused C. K. Ramakrishnan over phone. He furtherstated that the accused Tuncay Alankus and Cihan Karanci also visited the office of the accused C. K. Ramakrishnan in November 1995 and made a call to Turkey from hisoffice. The lists of telephone calls submitted by the CBI (Vol. He also staled that the accusedp. C. Yadav used, to talk to the accused C. K. Ramakrishnan over phone. He furtherstated that the accused Tuncay Alankus and Cihan Karanci also visited the office of the accused C. K. Ramakrishnan in November 1995 and made a call to Turkey from hisoffice. The lists of telephone calls submitted by the CBI (Vol. IV of the CBI s paperbook) show that during the relevant period, the-accused persons remained in constantlouch with each other. During that period, certain telephonic calls were made to andfrom the residence of Shri Ram Lakhan Singh Yadav, father of the accused P. C. Yadav. ( 16 ) THE document (Ex. D-12 at page 280 of Vol. II of the CBI s paper book) showsthat on 11. 9. 1995, the accused M. Sambasiva Rao submitted the price bid to the NFLon behalf of M/s. KARSAN for supply of 200000 MT urea (ft USD 190 per MT and itwas mentioned therein that payment of total value of the contract will he made oncompletion of delivery of the urea. In the said price bid, M/s. KARSAN were shown asmanufacturer of urea. the evidence collected by the prosecuting agency shows thatm/s. KARSAN were neither manufacturer nor producer of urea. This gives rise to aninference that a false representation was made by M/s. KARSAN in order to claim exemption from depositing the earnest money in accordance with the procedure approved by the NFL. ( 17 ) THE case diary statements of Anil Sharma, Arun Goel, Deepak Lal and P. K. Kataria reveal as to how the accused C. K, Ramakrishnan and D. S. kanwar misusedtheir official position by pressurising their subordinate officers to submit a proposalfor awarding the contract to M/s. KARSAN. The-office note (at page 314 of Vol. II ofcbi s paper book) shows that on 1. 11. 1995, the said proposal was approved by the accused D. S. Kanwar and C. K. Ramakrishnan. Thus, the accused D. S. Kanwar and C. K. Ramakrishnan managed to put a fresh contract in place of the contract dated27. 7. 1995 making a staggering commitment for payment of 100% cash prepayment ofthe total contract value to M/s. KARSAN. The statements of the said witnesses furtherreveal that the accused C. K. Ramakrishnan and D. S. Kanwar rushed the said deal inan unholy haste and violated the established norms by paying KARSAN the full advance of Rs. 7. 1995 making a staggering commitment for payment of 100% cash prepayment ofthe total contract value to M/s. KARSAN. The statements of the said witnesses furtherreveal that the accused C. K. Ramakrishnan and D. S. Kanwar rushed the said deal inan unholy haste and violated the established norms by paying KARSAN the full advance of Rs. 133 crores without ensuring that an "all risks" insurance had been takenagainst the contract. The minutes of the Board of Directors of the NFL show that theaccused C. K. Ramakrishnan had also kept the Board in the dark about the said deal. ( 18 ) THE prosecuting agency has also collected the evidence to show that on 2. 11. 1995,the NFL officials, on instruction of the accused D. S. Kanwar, prevailed upon the officials of the Slate Bank of India, South Extension Branch, for making payment of insurance premium of USD 3,80,000 for the urea import. This was cleared the same dayeven though the agreement with M/s. KARSAN for supply of urea was signed on9. 11. 1995. The aforesaid amount in foreign exchange was released in contravention of the Exchange Control Manual. ( 19 ) THE case diary statements of Mr. Deepak Lal, Mr. Subhash Chandra, Mr. S. D. Malhotra, Sunil Sachdeva and the Chief Manager of the State Bank of India s Southextension Branch Mr. K. L. Batra reveal as to how on 14. 11. 1995, the accused D. S. Kanwar prevailed upon the Bank Manager to remit a sum of USD 37. 62 million to thekarsan s account in the Pamuk Bank, Ankara (Turkey ). According -to Mr. K. L. Baira, when he pointed out that the foreign exchange could not be released in the absence of a bank guarantee and an insurance cover for non-performance of the contracthe was assured by the accused D. S. Kanwar that NFL would get the requisite permission from the Reserve Bank of India. This was contrary to the Exchange Controlmanual. It is relevant to mention that on 10. 11. 1995, the State Bank of India wrote tothe Reserve Bank of India intimating about remittance of the first instalment of 1% ofthe advance payment of M/s. KARSAN. The letter further sought approval of thereserve Bank of India for remitting the balance 99% of the advance on the basis ofthe insurance cover to he provided by the NFL. 11. 1995, the State Bank of India wrote tothe Reserve Bank of India intimating about remittance of the first instalment of 1% ofthe advance payment of M/s. KARSAN. The letter further sought approval of thereserve Bank of India for remitting the balance 99% of the advance on the basis ofthe insurance cover to he provided by the NFL. This letter was received by thereserve Bank of India on 14. 11. 1995. But, the accused C. K. Ramakrishnan and D. S. Kanwar prevailed upon the Bank officials to remit the balance of the advance amounting to USD 37. 62 million to the KARSAN s bank on 14. 11. 1995 itself. The manner inwhich the accused C. K. Ramakrishnan and D. S. Kanwar allowed foreign exchange of37. 62 million USD to be transferred to the KARSAN s account without ensuring thatan "all risks" insurance had been taken against the contract raises strong suspicionagainst them. However, the evidence collected by the prosecuting agency shows thaton 14. 11. 1995 the accused C. K. Ramakrishnan and D. S. Kanwar, acting on the directions of the accused Tuncay Alankus, got remitted a sum of USD 37. 62 million to thekarsan s Corporate account in the Pamuk Bank, Ankara (Turkey ). It appears thaton that day, M/s. KARSAN did not have any account in the said bank and so the accused Tuncay Alankus sent a fax message to the NFL requesting to divert the saidmoney to the account No. 1051467 of the Indo-Suez Bank, Geneva, Switzerland. Thecase diary statements of Mr. Deepak Lal and Mr. K. L, Batra reveal that on 14. 11. 1995at. about. 11. 30 P. M. , a telephonic message was sent to the Manager of the Slate Bankof India s branch at New York advising him to divert the money to the lndo-Suez Bankat Geneva. Accordingly, on 15. 11. 1995, the money was diverted to the said bank. Thedocuments on record reveal that on receipt of remittance of 37. 62 million USD, thesaid bank made enquiries from the MHK Marine London to find out whether the insurance cover note dated 6. 11. 1995 furnished by M/s. KARSAN covered the risk ofnon-performance and non-delivery as mentioned in the contract. On finding that thesaid insurance cover did not cover the risk of non-performance and non-delivery, thesaid bank declined to accept the remittance and returned it to the concerned branchof the State Bank of India. 11. 1995 furnished by M/s. KARSAN covered the risk ofnon-performance and non-delivery as mentioned in the contract. On finding that thesaid insurance cover did not cover the risk of non-performance and non-delivery, thesaid bank declined to accept the remittance and returned it to the concerned branchof the State Bank of India. ( 20 ) IN this context, a reference may be made to the insurance cover note dated6. 11. 1995 furnished by the KARSAN. It was stipulated in the contract that the buyerwill transfer 100% cash prepayment of the total contract value to the seller s bank account for 200000 MT of urea after receiving the related insurance policy from the Insurance Company covering the risk of seller s non-delivery and non-performance. instead of furnishing an insurance policy covering the risk of non-delivery and nonperformance. , the accused Tuncay Alankus furnished a maritime transport risk coverdated 6. 11. 1995. The statements of Mr. Alfred C. Kingsnorth and Neil Stevens revealthat the said cover note covered only marine perils and did not cover non-performance for any other reasons. That being so, the said cover note cannot be treated as an insurance policy for non-performance and non- delivery. ( 21 ) LEARNED counsel appearing for the accused Tuncay Alankus, Cihan Karanci andp. . C. Yadav have raised mainly two objections in respect of the statements of Mr. Neilsleven, Mr. A. C. Kingsnorth and Mr. Bancroft, Firstly, their statements are inadmissible in evidence as they suffer from the vice of being signed by them and secondly,they have been placed on the record after framing of the impugned charges and sothey cannot be taken into consideration by this Court. It is relevant to mention, thatstatements of the said witnesses were not recorded under Section 161 Criminal Procedure Code and sothey are not hit by Section 162 Criminal Procedure Code On the contrary, their statements wererecorded by the competent authorities of the concerned country in pursuance of theletter Rogatory issued under Section 166-A Criminal Procedure Code As was pointed out by the S. C. inunion of India and Another v. W. N. Chadha, 1993, Supp. (4) SCC 260, "letter Rogatoryis a formal communication in writing sent by a Court in which action is pending to aforeign country or Judge requesting the testimony of a witness residing within thejurisdiction of that foreign Court may be formally taken thereon under its directionand transmitted to the issuing Court making such request for use in a pending legalcontest and action. " The statements of the said witnesses have been recorded in accordance with the procedure sanctioned by the law of the concerned country. Thatapart, the mere fact that the signatures of the said witnesses have been taken will notmake their statements inadmissible. (Zuhinlddin v. Emperor AIR 1947 PC 75 ). ( 22 ) IT is also worth-mentioning that the statements of the said witnesses have beenobtained to lend assurance to the evidence collected by the prosecuting agency and sothey can be taken into consideration by this Court to find out if the facts emergingfrom the materials placed on the record taken at their face value disclose the existenceof the ingredients constituting the offences alleged. ( 23 ) HOWEVER, the accused Tuncay Alankus s failure to furnish insurance policy interms of the contract clearly indicates his guilty intention. It is also relevant to mentionthat when the lndo-Sue/. Bank, Geneva returned the remittance of 37. 62 millionsusd, the accused Tuncay Alankus opened three accounts in the Pictet Bank, Geneva (Switzerland ). Account No. 91923 was opened in the corporate name of M/s. KARSAN and the accounts No. 91924 and 91925 were opened in the name of the accusedcihan Karanci and Tuncay Alankus respectively. These accounts were opened on22. 3. 1995 and on 23. 11. 1995, the accused Tuncay Alankus addressed a letter to thenfl requesting for remittance of 37. 62 million USD to the Pictet Bank, Geneva. Theaccused M. Sambasiva Rao also sent a letter to the accused D. S. Kanwar in this regardas he was in constant touch with the accused Tuncay Alankus and Cihan Karanci. On28. 11. 1995, the said money was diverted to the Pictet Bank Geneva and receipt thereofwas confirmed by the bank vide letter dated 29. 11. 1995. There is evidence on record toshow thaton receipt of the said confirmation letter, the accused D. S. Kanwar andc. K. Ramakrishnan informed the accused M. Sambasiva Rao and B. Sanjeeva Raoabout receipt of the amount by the Pictet Bank, Geneva. 11. 1995. There is evidence on record toshow thaton receipt of the said confirmation letter, the accused D. S. Kanwar andc. K. Ramakrishnan informed the accused M. Sambasiva Rao and B. Sanjeeva Raoabout receipt of the amount by the Pictet Bank, Geneva. The prosecuting agency hasalso placed documentary evidence on record to show that on 30. 11. 1995 the accusedtuncay Alankus hurriedly withdrew substantial amount from the corporate account ofm/s. KARSAN and transferred/remitted different amounts to the accounts of diferent parties including himself and Cihan Karanci, as mentioned below; (i) US $ 28. 10 million to his personal account No. 91925 with Pictet Bank,geneva, Switzerland. (ii) US $ 1. 10 million to the account No. 91924 of Cihan Karanci with Pictetbank, Geneva, Switzerland. (iii) US $ 4. 00 million to the account of M/s. Edible Food Stuff Trading,dubai. (iv) US $ 2. 00 million to the account of M/s. Malyn Holdings Ltd. , U. S. A. (v) US $342,000 to the account of Sh. P. Papaghikas in Greece. (vi) US $ 200,000 to the account of Sh. M. Sambasiva Rao in Hyderabad (India ). ( 24 ) THE case diary statements of V. G. Paryani, R. K. Babani, B S. Lagoo and Dharmesh Yadav reveal that Rajender Kumar Babani was a key conduit for the alleged illegal kickbacks received by the accused M. Sambasiva Rao and the accused P. C. Yadav and also for transfer thereof to the accused B. Sanjeeva Rao and D. Malleshamgaud. The amount received by the accused B. Sanjeeva Rao was deposited in his account in the Vijya Bank, Hyderabad. It is contended on behalf of the accused M. Sambasiva Rao and B. Sanjeeva Rao that the monies received by them related to theirregular business dealings and had nothing to do with the KARSAN deal. This is theirdefence which they can adopt at the appropriate stage of the trial. But merely raisingsuch a contention now is no ground for quashing the prosecution. ( 25 ) THE prosecution has produced the documents (at pages 1181- 1450 of Vol. No. VIof the CBI s paper book) giving details of funds transferred from the corporate account No. 91923 of M/s. KARSAN to the personal accounts No. 91924 and 91925 ofthe accused Cihan Karanci and Tuncay Alankus, respectively. The. documents furthersi-low that on 28. 5. ( 25 ) THE prosecution has produced the documents (at pages 1181- 1450 of Vol. No. VIof the CBI s paper book) giving details of funds transferred from the corporate account No. 91923 of M/s. KARSAN to the personal accounts No. 91924 and 91925 ofthe accused Cihan Karanci and Tuncay Alankus, respectively. The. documents furthersi-low that on 28. 5. 1996, the accused Tuncay Alankus opened an account in the SBSBank at Monaco and deposited substantial amount in the said bank. He also openedanother bank account at Monaco in the name of his minor daughter Ruyan. Details ofthe transfer of funds and gist of transactions have been shown at pages 1283 and 1428of Vol. No. VI of the CBI s paper book. This clearly shows that after receipt of themoney, the accused Tuncay Alunkus hurriedly withdrew substantial amount of moneyfrom the corporate account of M/s. Tuncay Alunkus. There are numerous other document? on record to show that after receipt of the money the accused Tuncay Alunkuskept on assuring the NFL to supply the urea but his actions seem to belie his words. This clearly shows that the accused Tuncay Alunkus and Cihan Karanci has no intention of supplying the urea to the NFL from the day one and even prior to the executionof the contract. The mariner in which the accused Tuncay Alunkus hurriedly withdrewsubstantial amount from the corporate account of M/s. KARSAN and transferred/remitted different amounts to the parties (accused Cihan Karanci M. Sambasiva Rao and P. C. Yadav) including himself and his minor daughter, raises a strongsuspicion in favour of the view that the siphoning off a whopping sum of Rs. 133 croresbelonging to the NFL was the result of a well-orchestrated conspiracy hatched by theaccused persons. ( 26 ) AS noticed earlier, 4 million USD remitted by the accused Tuncay Alunkus tothe account of M/s. Edible Finance Trading, Dubai were brought to Hyderabadthrough hawala channels with the help of the accused D. Mallesham Gaud, Rajenderkumar Babani and Dharmesh Yadav, The documentary evidence on the record showsthat out of the said amount the accused Sambasiva Rao paid Rs. 70 lakhs to the accused B Sanjeeva Rao, Rs. 60 lakhs to the accused D. Mallesham Gaud and purchasedabout 2 acres of prime land situated at Namapalli (Hyderabad) besides making other payments/investments. 70 lakhs to the accused B Sanjeeva Rao, Rs. 60 lakhs to the accused D. Mallesham Gaud and purchasedabout 2 acres of prime land situated at Namapalli (Hyderabad) besides making other payments/investments. ( 27 ) IT is significant to mention that in his statement recorded under Section 40 offera, the accused D. Mallesham Gaud has confessed having received a sum of Rs. 40,00,000 in cash from the accused M. Sambasiva Rao. According to him, after payingthe said amount, the accused M. Sambasiva Rao took three cheques (one cheque forrs. 12,00,000 and two cheques of Rs. 10,00,000 each) from him in favour of the companies belonging to the accused B. Sanjeeva Rao and his family members. Theaforesaid cheques were issued in favour of (i) M/s. Madicon Marketing (Pvt.) Ltd. Hyderabad, (2) M/s. R. R. Finance and Investment (Pvt) Ltd. Hyderabad M/s. Saibharal Finace (Pvt.) Ltd. Hyderabad and these companies were owned/controlled bythe accused B. Sanjeeva Rao and his family members. Thus, the accused B. Sanjeevarao also got his share of Rs. l. 02 crores out of the defrauded amount. ( 28 ) AS regards the accused Prakash Chand Yadav, it is alleged that he directed theaccused D. S. Kanwar to get 2 million USD remitted through the accused Sambasivarao to the account of M/s. Penny Cairn Holding with Rea Brothers Ltd. America,which amount was then remitted by the accused Tuncay Alunkus. The statement ofdharmesh Yadav shows that on 20. 12. 1995 he had seen a note written by V. G. Paryaniregarding remittance of the said amount to Rea Brothers in the office of M/. s. Ediblefood Stuffs Trading. He also stated that the advice which was asked for by the accused M. Sambasiva Rao was meant for the accused P. C. Yadav and this was also confirmed by V. G. Paryani. The statement of B. S. Lagoo hows that the accused M. Samhasiva Rao had given the fax copy of the said advice to the accused D. S. Kanwarsaying "throw it at the face of the accused Prakash Chand Yadav, it will shut up hismouth. The statement of B. S. Lagoo hows that the accused M. Samhasiva Rao had given the fax copy of the said advice to the accused D. S. Kanwarsaying "throw it at the face of the accused Prakash Chand Yadav, it will shut up hismouth. " The said statement of the accused M. Sambasiva Rao is admissible under Section 10 of the Evidence Act which renders anything said, done or written by any one ofthe conspirators in reference to their common intention as a relevant fact, not only asagainst each of the conspirators but for proving the existence of the conspiracy itself. (Slate of Gujrat v. Mohammed Atik and Others, -JT 1998 (3) SC 60-, (State ofmuharashtra v. Damn) JT 2000 (5) SC 575, State through Superintendent of Police,cbi/sit v. Nalini and Others, JT 1999 (4) SC 106. Thus, the said statement of the accused M. Sambasiva Rao prima facie shows that the accused P. C. Yadav was also aparly to the alleged criminal conspiracy. That apart, the case diary statement of Sh. Satish Chand, Additional P. S. to Shri Ram Lakhan Singh Yadav, the then Union Minister for Chemicals and Fertilizers, shows that by the end of December, 1999 or firstweek of January, 1996, he was directed by the accused P. C. Yadav to collect a paperfrom the accused D. S. Kanwar. Accordingly, he visited the office of the accused D. S:kanwar, who gave him an advice regarding remittance of 2 million USD from Dubaito the Rea Brothers USA. He also stated about the immediate reaction of the accusedp. C . Yadav on receipt of the said advice. He also slated that Rea Brothers was theiron company of the accused P. C". Yadav. The statement of I. M. Edward Bancroftread along with the notes of his meeting with Harish Sethi (at page 1545 of Vol. II ofthe CBI s paper book), shows that Mr. HarishSethi was the person who took care ofthe New York s operations of the accused P. C. Yadav. The statement of Mr. Bancroftfurther shows that on 27. 12. 1995 the remittance of USD 2 million was received fromdharmesh Kumar Yadav. The said amount was remitted by the Standard and Charteredbank, New York to the Rea Brothers. According to Mr. Bancroft, on 4. 1. 1996, the saidbank received an instruction, signed by Mr. Sethi for transfer of 199900. The statement of Mr. Bancroftfurther shows that on 27. 12. 1995 the remittance of USD 2 million was received fromdharmesh Kumar Yadav. The said amount was remitted by the Standard and Charteredbank, New York to the Rea Brothers. According to Mr. Bancroft, on 4. 1. 1996, the saidbank received an instruction, signed by Mr. Sethi for transfer of 199900. 00 US dollarsto Marine Midland Bank, New York Branch and ultimately the said amount was transferred to the HSBC (Pvt.) Bank, Jersey and credited into the account of MMI Ltd. The prosecution has also filed a list of telephone calls made to and from the residenceof Mr. Ram Lakhan Singh Yadav to the accused D. S. Kanwar, C. K. Ramakrishnan, M. Sambasiva and the accused B. Sanjeeva Rao. The prosecution has also relied on theconfessional statement of the accused D. Mallesham Gaud recorded under Section 40of FERA. In his confessional statement, he has staled that a ,sum of Rs. 2 million USDwas also paid to the accused Prakash Chand Yadav. Learned counsel for the partieshave cited several authorities regarding admissibility of the said confessional statement of the accused D. Mallesham Gaud against the remaining accused persons. Atthis preliminary stage, it would not be appropriate to decide admissibility of the saidconfessional statement. Moreover, a detailed discussion of the principles enunciatedin the cited decision is apt to partake of the character of a speculative exercise. In myopinion the facts. enierging from the evidence brought on record raise a strongsuspicion regarding the involvement of the accused P. C. Yadav in the alleged criminalconspiracy. ( 29 ) LEARNED senior counsel appearing on behalf of the accused Tuncay Alankus andcihan Karanci has strenuously urged that the dispute between the NFL and M/s. KARSAN is purely of a civil nature and the same has also been REFERRED TO to the arbitration in accordance with the arbitration agreement and hence no prosecution in respectof the said dispute should have been permitted. In my opinion the aforesaid submission of the learned counsel does not hold much water. In this context, a reference tothe decision of the Supreme Court in Rajesh Bajaj v. State of NCT of Delhi and Othersjt 1999 (2) SC 112 has become indispensable. In that case, it was held that merely because an act has a civil profile is not sufficient to denude it of its criminal outfit. Similarly, in Trisuns Chemical . In this context, a reference tothe decision of the Supreme Court in Rajesh Bajaj v. State of NCT of Delhi and Othersjt 1999 (2) SC 112 has become indispensable. In that case, it was held that merely because an act has a civil profile is not sufficient to denude it of its criminal outfit. Similarly, in Trisuns Chemical . Industry v. Rajesh Agarwal and Others JT 1999 (6) SC 618it was held that an arbitration agreement embedded in the contract is not an effectivesubstitute for a criminal prosecution when the disputed act is an offence as the arbitrator cannot conduct a trial of any act which amounted to an offence albeit thesame act be connected with the discharge of any function under the agreement. Inmedical Chemicals and Pharma Pvt. Ltd. v. M/s. Biological E. Ltd. and Ors. JT2000 (2) 426,it was held that simply because of the fact that there is a remedy provided for breachof contract, that does not by itself clothe the Court to foreclose the criminal prosecution at the threshold. Both criminal law and civil law remedy can be pursued in diversesituations and "they are not mutually exclusive but clearly co-extensive and essentiallydiffer in their content and consequence. " It is anathema to suppose that when a civilremedy is available, a criminal prosecution is completely barred. Having regard to thefactual aspect of the matter, I am of the opinion that this is not a case in which the trialof the accused Tuncay Alankus and Cihan Karanci can be allowed to be short circuited. ( 30 ) FOR the reasons discussed. love, I am of the opinion that the materials collectedby the prosecuting agency are sufficient to raise a very strong suspicion to form apresumptive opinion as to the existence of the factual ingredients constituting the offences under Section 420/120-B Indian Penal Code alleged to have been committed by the accusedpersons. The circumstantial evidence on the record prima facie shows that the allegedcriminal conspiracy was executed with ingenuity, dexterity and adroitness. ( 31 ) ASSUMING that the accused Tuncay Alankus and Cihan Karanci, had no intentionto defraud the NFL, then there is sufficient ground for framing a charge under Section409 Indian Penal Code against them. It has come on the record that they had received a sum of Rs. 133 crores from the NFL for supply of 200 000 MT urea in terms of the contract dated9. 11. It has come on the record that they had received a sum of Rs. 133 crores from the NFL for supply of 200 000 MT urea in terms of the contract dated9. 11. 1995. As noticed above, M/s. KARSAN had no intention to supply the urea to thenfl from the day one and even prior to the execution of the contract. However, afterarrest of the accused C. K. Ramakrishnan, D. S. Kanwar and Sambasiva Rao, pressurewas mounted on the accused Tuncay Alankus to despatch urea as a result whereof theaccused Tuncay Alankus shipped first consignment of the 9000 M urea, which arrived at Bhav nagar port on 1. 7. 1996 but it was of unacceptedly poor quality and so thenfl declined to accept the delivery. ( 32 ) LEARNED Senior counsel contended that the harsh weather conditions in the CIScountries and the war in Chechnya had affected the performance of the contract tosuch an extent as to make it virtually impossible or even extremely difficult and hazardous. He has also cited some decisions on the principle of frustration of contracts. This is the defence of the accused Tuncay Alankus and Cihan Karanci which they canadopt at the appropriate stage of the trial. But merely raising such a contention now isno ground for quashing the impugned charges. Learned senior counsel further contended that the accused Tuncay Alankus and Cihan Karanci were neither merchantsnor brokers and so the learned Special Judge has commited a patent illegality in invoking the penal provision of Section 409 Indian Penal Code against them. He also contended thatpayment of the total contract value to M/s. KARSANs does not amount to "entrustment" within the meaning of Section 405 IPC. He further contended that there is notan iota of legal evidence on record to show that the accused personsdishonestlymisappropriated the money in question or converted it to their own use. On the otherhand, the learned Additional Solicitor General, relying on the decision in P. D. Mehraand Ors. v. Rani Chand 0m Parkash AIR 1952 Punjab 34 (FB), submitted that the term merchant as used in a contract for the supply of goods is not restricted to persontrading entirely on his own account. A merchant is a person who trades in goods, thatis to say, who. buys and sells goods. He further submitted that the accused persons. v. Rani Chand 0m Parkash AIR 1952 Punjab 34 (FB), submitted that the term merchant as used in a contract for the supply of goods is not restricted to persontrading entirely on his own account. A merchant is a person who trades in goods, thatis to say, who. buys and sells goods. He further submitted that the accused persons. contracted to supply urea for 38 million USD and after receipt of the said amountthey dishonestly misappropriated it and thereby committed an offence punishableunder Section 409 IPC. It would not be appropriate to notice and discuss in detail thevarious decisions cited by the learned counsel at the Bar, because the questionwhether the accused Tuncay Alankus and Cihan Karanci misappropriated the fundsentrusted to them is, to a substantial extent, one of fact. At this preliminary stage,therefore, when the prosecution has yet to lead evidence to prove all the facts relevantto substantiate the ingredients of the impugned charges framed against the accusedpersons, a detailed examination of the evidence and elaborate documentation of themerits should be avoided. No party should have the impression that his case has beenprejudiced. To be satisfied about a prima facie case is needed but it is not the same asan exhaustive exploration of the merits in the order itself. Section 405 Indian Penal Code defined the offences of criminal breach of trust and an essentialcondition of this offence is that the accused being in any manner entrusted withproperty or with dominion over property, dishonestly misappropriates or converts tohis own use that property or dishonestly uses or disposes of that property in violationof any direction of law prescribing the mode in which such trust is to be discharged orof any legal contract, express or implied, which he has made touching the discharge ofsuch trust. As noticed earlier, the NFL had paid 38 million USD to M/s. KARSAN forimport of 200000 MT urea. The documentary evidence on record prima facie showsthat after-receipt of the said amount the accused Tuncay Alankus hurriedly withdrewthe substantial amount from the corporate account of M/s. KARSAN andremitted/transferred it to the key players of the alleged criminal conspiracy includinghimself. The prosecuting agency has also produced documentary evidence to showthat out of the said amount the accused Tuncay Alankus purchased certain propertiesand also transferred some amount to the account of his minor daughter Ruyan. The prosecuting agency has also produced documentary evidence to showthat out of the said amount the accused Tuncay Alankus purchased certain propertiesand also transferred some amount to the account of his minor daughter Ruyan. Theevidence on record raises a strong suspicion in favour of the view that the accusedtuncay Alankus and Cihan Karanci had no intention to supply urea to the NFL fromthe day one and even prior to the execution of the contract. A person can be said tohave misappropriated some properly including money, if he has used it in a way different from what he was bound to do by virtue of a contract or as a result of a legalrelationship created through some process of law. The entrustment within the meaning of Section 405 Indian Penal Code may arise in any manner whatsoever . The manner may or maynot involve fraudulent conduct of the accused. Section 409 Indian Penal Code covers dishonestmisappropriation in both types of cases; that is to say, those where the receipt ofproperty is itself fraudulent or improper and those where a public servant, merchant,broker, etc misappropriates what may have been quite properly or innocentlyreceived. All that is required is what may be described as entrustment or acquisitionof dominion over property in the capacity of a public servant, banker, merchant,broker, attorney or agent who as aresult of it, becomes charged with a duty to act inparticular way, or, atleast honestly. That being so, in the facts and circumstances of thecase, the learned Special Judge was fully justified in invoking the penal provision ofsection 409-IPC against the said accused persons. ( 33 ) IN a last ditch attempt and indeed what appears to me an argument of desperation, learned senior counsel appearing for the accused Tuncay Alankus and Cihankaranci contended that the learned Special Judge has no jurisdiction to try the offence punishable under Section 420/409/120-B IPC. In this context a reference to subsection (3) of Section 4 of the Prevention of Corruption Act has becomeindispensable. Sub-section (3) of Section 4 empowers a Special Judge to try any offence, other than an offence specified in Section 3 with which the. accused may, underthe Code of Criminal Procedure, be charged at the same trial. Under Section 220 ofthe Code of Criminal Procedure if in. Sub-section (3) of Section 4 empowers a Special Judge to try any offence, other than an offence specified in Section 3 with which the. accused may, underthe Code of Criminal Procedure, be charged at the same trial. Under Section 220 ofthe Code of Criminal Procedure if in. one series of acts so connected together as toform the same transaction, more offences than one are committed by some person, hemay be charged with and tried at one trial for every such offence and under Section223 Criminal Procedure Code persons accused of the same offence committed in the course of the sametransaction, as well as persons accused of an offence and persons accused of abet-ment, or of an attempt to commit such an offence may be charged and tried together. Thus, in the facts and circumstances of the case the learned Special Judge has jurisdiction to try the offences punishable under Section 420/409/120-B Indian Penal Code together with theoffences punishable under the Prevention of Corruption Act. For the foregoing reasons, I am of the opinion that the impugned order dated7. . 1. 1. 1998 passed by the learned Special Judge, does not suffer from any legal infirmitywarranting interenference of this Court. ( 34 ) IN the result, the petitions are dismissed. Before parting with this Order I wouldlike to make it clear that the special Judge, while assessing the evidence and recordinghis findings on its basis with regard to proof or otherwise of the factual ingredients ofthe offences alleged, shall not allow himself to be unduly influenced by any observa-tion made in this order in regard to the merus of the case.