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2018 DIGILAW 1123 (GUJ)

Girishbhai Natvarlal Trivedi v. State of Gujarat

2018-09-25

R.P.DHOLARIA

body2018
JUDGMENT R. P. Dholaria, J. Rule. Learned APP waives service of notice of rule on behalf of respondent-State. 2. By way of filing the present Criminal Misc. Application, the applicants have prayed for the following reliefs:- (A) "This Hon'ble Court may be pleased to quash and set aside the First Information Report registered with respondent No.2 being Crime Register No.I-41 of 2004 for the offences under Sections 406, 409, 420 and 120B of the Indian Penal Code at Annexure-A to the petition, also chargesheet challan at Annexure-B to the present petition and further ACB Special Case No.12 of 2014 pending before the Honourable Sessions Court, Ahmedabad qua the present petitioners; (B) Pending the admission, hearing and final disposal of this application, this Hon'ble Court may be pleased to stay the further proceedings arising out of ACB Special Case No.12 of 2014 pending before the Honourable Sessions Court, Ahmedabad, qua the present petitioners; (C) Any other and further reliefs, as may be deemed fit and proper by this Hon'ble Court, may kindly be granted, in the interest of justice;" 3. The case of the complainant in the CR.No.I-41 of 2004 registered with CID Crime, Gandhinagar for the offences punishable under Sections 406, 409, 420 and 120-B of the Indian Penal Code, translated version of which reads as under:- "The sum and substance of the prosecution case is that the accused/petitioners have availed of periodical advances from the respondent No.3-complainant Bank by producing false details pertaining to stock & recovery. It is further alleged that the firms of the petitioners were incurring loss as per books of account, by showing profit such finances were obtained and renewed from the respondent No.3-Bank. It is further alleged that petitioner No.1 being member of loan committee of branch of the respondent No.3 has also got sanctioned a loan in his favour. It is further the case of the prosecution that after availing such finance, the petitioner did not repay the same, in that way, offences u/s 406, 409, 420, 120-B of the Indian Penal Code have been committed." After registration of the FIR at Annexure-"A", the respondent No.2-CID Crime, Gandhinagar has carried out investigation and filed chargesheet against the applicants on 03.07.2007 under the alleged offences committed under Section 406, 409, 420, 120-B of Indian Penal Code. 4. 4. It is pointed out by learned advocate for the applicants that initially charge was framed in the present case by the Metropolitan Magistrate Court, Ahmedabad, in Criminal Case No.1659 of 2010. The said charge had been quashed and set aside by the learned Sessions Court, Ahmedabad, vide judgment dated 08th October, 2010 delivered in Criminal Revision Application No.430 of 2010. It is pointed out by learned advocate for the applicants therefore state that as on today, after passing order at Annexure-E to the present petition, no charge is yet framed by the Metropolitan Magistrate Court, Ahmedabad. Almost all the cases registered with respondent No.2 herein had been committed to the Sessions Court and so far as applicants are concerned, it is numbered as ACB Special Case No.12 of 2014. 5. It is pointed out by learned advocate for the applicants that the applicant No.1 was acting as Member in Advisory Committee of respondent No.3 Bank. The applicants have obtained different loans under different heads from the respondent Bank, details of which are as under:- (i) Applicant No.1 as a Proprietor of Indye Chemicals initially availed hypothecation loan of Rs. 05.00 lakhs and thereafter it was enhanced upto Rs. 11.50 lakhs; (ii) Applicant No.1 had also obtained term loan of Rs. 10.00 lakhs as Proprietor of Indye Chemicals; (iii) Applicant No.1 has also obtained loan of Rs. 06.00 lakhs as Karta of HUF Archana Associates. Thus, in all, applicant No.1 availed loan of Rs. 27.50 lakhs; (iv) Applicant No.2 availed loan of Rs. 08.00 lakhs from respondent No.3 Bank as Proprietor of Nikida Dyes & Chemicals. Thus, it can be seen that in all, applicants have availed loan of Rs. 35.50 lakhs from respondent No.3 Bank. At the time of availing loan under different heads and under different capacity, applicants submitted all the necessary documents with the respondent No.3 Bank against the said borrowings. 6. It is submitted that however, due to certain reasons, after making repayment of Rs. 17 Lacs out of Rs. 35.50 lacs before registration of FIR at Annnexure-A and Rs. 10 Lacs after registration of FIR at Annexure-A and before granting bail to the applicants which aggregating Rs. 27 Lakh and applicants failed to repay the remaining outstanding loan amount to the respondent No.3-Bank. The respondent No.3 Bank therefore registered complaint against the applicants. 17 Lacs out of Rs. 35.50 lacs before registration of FIR at Annnexure-A and Rs. 10 Lacs after registration of FIR at Annexure-A and before granting bail to the applicants which aggregating Rs. 27 Lakh and applicants failed to repay the remaining outstanding loan amount to the respondent No.3-Bank. The respondent No.3 Bank therefore registered complaint against the applicants. It is the only case of respondent No.3-Bank that applicants failed to repay the loan amount in prescribed time and there is no case of forgery or fraud even in the FIR at Annexure-A and Chargesheet Challan at Annexure-B. 7. Learned advocate for the applicants submitted that pursuant to the complaint filed by the respondent No.3-Bank, applicant No.2 applied for regular bail under Section 437 of the code and has been released on regular bail by the learned Chief Metropolitan Magistrate, Ahmedabad vide order dated 26.2.2007. The applicant no.1 has also approached the learned Chief Metropolitan Magistrate, Ahmedabad under section 437 of the Code and same was rejected vide order dated 6.6.2007 and thereafter the applicant No.1 was also released on regular bail by learned Judge, learned Sessions Court No.6, Ahmedabad in Criminal Misc. Application No.2481/2007, on assurance given by applicant No.1 that he would make the some proportionate amount of outstanding loan amount of Rs. 8.50 Lakh in 9 equal monthly installments. 8. Learned advocate for the applicants submitted that as per the conditional bail granted to the applicant No.2, applicants have repaid the amount and thereafter applicants have settled the accounts by paying total amount of Rs. 6,42,019.78/- in the loan account under the One Time Settlement Scheme for all four loan accounts and details of payment are as hereunder. (1) Indye Chemicals - account no.10072, nothing was required to pay Rs. 50,000 was under deposit. (2) Indye Chemicals-account no.205212, Rs. 40808.68 was adjusted against the deposit of Rs. 57,500/-. (3) Archna Asscoiates-account no.206690, Total Rs. 2,22,558 which is inclusive of deposit of Rs. 30,000/-. (4) Nikida Dyes-account no.206442, Rs. 4,19,460.79 which is inclusive of deposit of Rs. 40,000/-. In pursuance of the settlement of the account, respondent No.3 Bank issued No due Certificates to the applicants. 40808.68 was adjusted against the deposit of Rs. 57,500/-. (3) Archna Asscoiates-account no.206690, Total Rs. 2,22,558 which is inclusive of deposit of Rs. 30,000/-. (4) Nikida Dyes-account no.206442, Rs. 4,19,460.79 which is inclusive of deposit of Rs. 40,000/-. In pursuance of the settlement of the account, respondent No.3 Bank issued No due Certificates to the applicants. Learned advocate for the applicants submitted that the respondent no.3 had instituted four different Lavad case for recovery of loan amount bearing Lavad Case No.636/2002, 2127/2002, 2132/2002 and 2133 of 2002 before the Board of Nomoinees, Ahmedabad and all are disposed of as all loan accounts are settled. 9. Learned advocate for the applicants submitted that applicants are senior citizens being aged 73 and 70 years respectively. There is no case of forgery or fraud against the applicants and the only case was about non-payment of loan amount in the prescribed time, which, however, was ultimately settled by paying all the amounts and the respondent No.3 Bank has also issued No-due Certificate evidencing settlement of the accounts. 10. Learned advocate for the applicants further submitted that even authorized officer of the respondent No.3 Bank had addressed a letter to the Reserve Bank of India on 31.5.2005 as it is difficult to recover the amount from borrowers through Civil Courts and therefore, the respondent no.3 is using criminal machineries and said letter is also produced in another matter bearing Special Civil Application No.12548 of 2003 and the applicant no.1 has also submitted the aforesaid letter at the time of praying for regular bail. 11. Learned advocate for the applicants submitted that in indential cases likewise the applicants, this Court has quashed the F.I.R and Criminal Case. 12. Learned advocate for the applicants submitted that the applicants have paid all the amount as required to be paid and even No-due Certificates have also been issued by the respondent No.3 Bank and therefore, continuation of criminal proceedings would be a futile exercise as there is no allegation of forgery and fraud against the present applicants. 13. Initially, the co-ordinate Bench of this Court issued notice by order dated 23.04.2018 making it returnable on 02.05.2018 and also directed the Bank official and Investigating Officer to remain present before the Court with all relevant papers. Further on 07.08.2018, Mr. 13. Initially, the co-ordinate Bench of this Court issued notice by order dated 23.04.2018 making it returnable on 02.05.2018 and also directed the Bank official and Investigating Officer to remain present before the Court with all relevant papers. Further on 07.08.2018, Mr. Chirag B Patel, learned advocate for the applicants stated that the matter is settled between the parties and all the four accounts after repaying the loan amount, no dues certificate dated 16.11.2016 had been obtained from the Madhavpura Mercantile Co-op. Bank Ltd. and also submitted that there is no outstanding dues against the applicants and requested to quash the FIR. Learned advocate Mr. KJ Panchal, learned advocate for the respondent No.3-Bank stated that the aforesaid no dues certificates, which have been issued by the Officials of the Bank are true and genuine and learned APP was permitted to verify the genuineness of the settlement. 14. This Court has heard Mr. B.S. Patel, learned advocate with Mr. C.B. Patel, learned advocate for the applicants, Mr. L.B. Dabhi, learned APP for the respondent Nos.1 & 2 and Mr. K.J. Panchal, learned advocate for the respondent No.3-Bank. 15. On the other hand, Mr. L.B. Dabhi, learned APP has opposed this application by submitting that the applicants are beneficiaries and signatories to the documents submitted by them before the bank to avail the loan facility. He submitted that though the applicants have availed the loan from the bank, they have not repaid the amount of loan and allowed the accounts to become NPA after closure of the bank. He submitted that there is no repayment of loan and therefore, the lavad case was filed. He submitted that the complaint was lodged in 2004 and the charge-sheet was filed on 03.07.2007. He submitted that in 2005, the Reserve Bank of India declared OTS scheme, then also, the applicants have approached the bank for OTS settlement at that time but availed it in 2016. In support of his submissions Mr. Dabhi, has relied upon the following decisions:- (I) (Ashok Sardarangani and another vs Union of India and Others, (2012) AIRSCW 1899). (II) Decision of Apex Court in Criminal Appeal No.1496 of 2009 (Central Bureau of Investigation vs Maninder Singh) dated 28.08.2015. (III) Decision of this Court in Criminal Misc. Application No.3820 of 2011 (Yezdi J Master vs State of Gujarat and another). Lastly, Mr. (II) Decision of Apex Court in Criminal Appeal No.1496 of 2009 (Central Bureau of Investigation vs Maninder Singh) dated 28.08.2015. (III) Decision of this Court in Criminal Misc. Application No.3820 of 2011 (Yezdi J Master vs State of Gujarat and another). Lastly, Mr. Dabhi has urged that on the facts of this case this Court may not exercise its powers and requested to dismiss the present application. 15.1 Mr. K.J. Panchal, learned advocate appearing for respondent No.3 has reiterated and urged to consider the arguments advanced by Mr. Dabhi, learned APP to be the part and parcel of his arguments on behalf of respondent No.2- Bank. It is further submitted upon the instructions of N.B. Suma (Legal Officer) of the complainant bank who is present before this Court that it is fact that the applicant have availed the OTS scheme and repaid the entire amount as per the scheme and bank has also issued "No Due Certificate", however the criminal court would examine the issue whether any offence is committed or not and further decide the petition on merits and the said FIR and charge-sheet cannot be solely quashed upon the settlement arrived with the complainant bank. 16. I have given my thoughtful consideration to the submissions made by learned advocates appearing for both the sides. I have also gone through the complaint along with other documents and material placed on record. 17. At this stage, it would be fruitful to examine the decision of the Apex Court wherein the guidelines have been laid as to in which matter, the Court would be justified in quashing the FIR and resultant criminal proceedings. The Apex Court in Preeti Gupta & another Vs. 17. At this stage, it would be fruitful to examine the decision of the Apex Court wherein the guidelines have been laid as to in which matter, the Court would be justified in quashing the FIR and resultant criminal proceedings. The Apex Court in Preeti Gupta & another Vs. State of Jharkhand & another, (2010) 7 SCC 667 , after following the decisions of the court in R.P. Kapur vs. State of Punjab, (1960) AIR SC 866 and in State of Haryana & others vs. Bhajanlal & others, (1992) Supp1 SCC 335 has laid the following three principles on which criminal proceedings can be quashed which are reproduced as under:- (i) where is manifestly appears that there is a legal bar against institution or continuance of the proceedings; (ii) where the allegations in the first information report or complaint taken at their fact value and accepted in their entirely do not constitute the offence alleged; (iii) where the allegations constitute an offence, but there is no legal evidence adduced or the evidence adduced clearly or manifestly fails to prove the charge; 18. It is now well settled that the court cannot be utilized for any oblique purpose and where in the opinion of the court chances of any ultimate conviction are bleak and, therefore, no useful purpose if likely to be served by allowing a criminal prosecution to continue, the court may while taking into consideration the special facts of the case also quash the proceeding even though it may be at a preliminary stage. 19. It is also well established by catena of judgments that inherent jurisdiction of the High Court can be exercised to quash proceedings in a proper case either to prevent the abuse of process of any court or otherwise to secure the ends of justice as well as where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceedings against the accused. It is also equally true that in case of economic offence, the Court should be very serious and conscious because such offence affects the economy of a nation. 20. In the backdrop of the aforesaid factual position as well as settled legal position, this Court would like to examine the complaint. It is also equally true that in case of economic offence, the Court should be very serious and conscious because such offence affects the economy of a nation. 20. In the backdrop of the aforesaid factual position as well as settled legal position, this Court would like to examine the complaint. It is not in dispute that the applicants have availed loan from respondent No.2 after following due procedure. At the time of hearing, Mr. Patel, leanred advocate appearing for the applicants has vehemently contended that the complaint is false, frivolous and absurd. The complainant has failed to mention as to in which manner, the applicants have committed the offence punishable under Sections 406, 409, 420, 120-B of Indian Penal Codee. From the record of the case, the status of the applicants is revealing as loanee-beneficiaries. If any procedure is given go-bye by the Directors or officials of the bank, the applicants cannot be held guilty for the said action on behalf of the bank. In absence of any factual evidence on record, it is very hard to establish or believe any case against the applicants. 21. Considering the factual matrix as emerges in the case on hand, no prudent person can ever reach a just conclusion that there is any legal evidence for proceeding against the applicants - original accused. 22. The allegations made in the complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. In the peculiar facts of the present case, if criminal machinery is set into motion then it will be very hazardous for the society at large including it will be challenge to even investigating agency which will definitely create hindrance to the investigation of genuine cases also. Criminal machinery can never be set into motion in absence of any physical evidence as regards to the commission of offence. The applicants have merely submitted the documents as required by the bank for obtaining the loan in question. Over and above, the applicants have already repaid the amount of loan with interest as per the OTS scheme floated by bank and the bank has also issued "No Due Certificate". 23. The applicants have merely submitted the documents as required by the bank for obtaining the loan in question. Over and above, the applicants have already repaid the amount of loan with interest as per the OTS scheme floated by bank and the bank has also issued "No Due Certificate". 23. This Court is conscious of the fact that the power of quashing a criminal proceeding should be exercised very sparingly and with circumspection and that too in the rarest of rare cases. In this view of the matter, I am of the considered opinion that this case falls in the category of rarest of rare cases as it leads to insurmountable harassment, agony and pain to the applicants as well as to their reputation only on the imagination of the complainant of known facts. There is no evidence, the complaint is false, frivolous, imaginary and absurd which is required to be quashed and set aside in exercise of inherent powers under section 482 of Code of Criminal Procedure, 1973. 24. In the result, this application succeeds and is allowed. The FIR bearing C.R.No.I41 of 2004 registered with CID Crime, Gandhinagar for the offences punishable under Section 406, 409, 420 and 120-B of the IPC which has culminated in charge-sheet at Annexure-B, numbered as Criminal Case No.1659 of 2010 and subsequently registered as ACB Special Case No.12 of 2014 pending before the City Sessions Court, Ahmedabad is hereby quashed and set aside qua the applicants. Rule is made absolute to the aforesaid extent. Direct service is permitted.