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2021 Supreme(Kar) 795

IN THE HIGH COURT OF KARNATAKA AT BENGALURU
JOHN MICHAEL CUNHA, J.
Sri. Hemant Nimbalkar, S/o. Madhukar - Petitioner
Versus
State of Karnataka, Rep. By Its Chief Secretary Government of Karnataka & Ors. - Respondents
Writ Petition No. 14014 of 2020 (GM-RES)
Decided On : 19-03-2021

Advocates Appeared:
For the Petitioner:Sri. Ashok Haranahalli, Sr. Advocate a/w Sri. Swaroop Anand R.
For the Respondents: Sri. V.M. Sheelvant, SPP-I a/w Sri. B.J. Rohith, HCGP, Sri. P. Prasanna Kumar, SPL-PP.

Headnote:

Constitution of India, 1950 - Article 226 – Indian Penal Code, 1860 - Section 120B r/w Sections 420, 406, 409 - Criminal Procedure Code, 1973 - Section 482 and 197 - Karnataka Police Act, 1963 – Section 170 - Prevention of Corruption Act, 1988 - Sections 7, 7(A), 8, 10, 11 & 12, 13(2) r/w. 13(1)(d) - Karnataka Protection of Interest of Depositors in Financial Establishment Act, 2004 - Section 9 – Offence of Criminal breach of Trust and Cheating - Fraud or default committed in repayment of deposits - Government Order - Allegations against petitioner / accused No.5 was that he being IGP, CID had forwarded enquiry report of (A-4) to State DG & IGP asserting that enquiry did not find any wrongdoings on part of IMA group of entities to invoke Act, 2004 against them; he categorically maintained that deposits collected by IMA group of entities were exempted under Section 2(2)(ii) of KPID Act; he did not mention about deposits collected by IMA Proprietorship owned by (A-6) in his report – Held, Government and authorities constituted under Act were aware of the alleged misdeeds of IMA and its entities in 2017 much before petitioner assumed office of IGP. As per provisions of Act, State Government and Competent Authority constituted under KPID Act were duty-bound to act by themselves rather than depending upon enquiry report by police. The entrustment of enquiry to police does not relieve State Government and authorities constituted under Act of their duty to provide protection to depositors in financial establishment - Under section 9 of KPID Act, only promoter, director, partner, manager or any other person or an employee responsible for management or conducting of business or affairs of such financial establishment, would be liable for fraud or default committed in repayment of deposits - The very enquiry initiated against petitioner being without authority of law and in violation of protection granted to petitioner under section 17A of PC Act and the sanction accorded for prosecution of petitioner itself being illegal and invalid, it would an abuse of process of court to continue investigation or prosecution of the petitioner based on the additional / supplementary charge sheet submitted by respondent No.2. For the above reasons, petitioner is entitled for reliefs claimed in petition - Petition is allowed.

ORDER :

1. This petition is filed under Article 226 of Constitution of India r/w section 482 Cr.P.C. seeking the following reliefs:-

    (1) Issue a writ of certiorari or any other appropriate writ, quashing Government Order dated 09.09.2020 bearing No. DPAR 89 SPS 2019 according prosecution sanction under Section 197 CrPC and 170 Karnataka Police Act, 1963 issued by the 1st Respondent in FIR RC-14(A)/2019 for offences under Section 120B r/w Sections 420, 406, 409 of IPC and Section 9 of the KPID Act, 2004 against the Petitioner herein produced at Annexure 'AY';

(2) Issue a writ of certiorari or any other appropriate writ, quashing supplementary chargesheet in SPL CC 1055/2019 naming the Petitioner as an accused, arraying him as accused No.25 for offences under section 120B r/w 420, 406, 218 and 409 IPC and Section 9 of KPID Act produced at Annexure 'BB';

(3) Issue a writ of certiorari or any other appropriate writ, quashing order of CBI SPL Court (CCH4) in SPL CC 1055/2019 dt: 06.11.2020 taking cognizance of supplementary chargesheet in SPL CC 1055/2019 naming the Petitioner as an accused, arraying him as accused No.25 for offences under Section 120B r/w 420, 406, 218 and 409 IPC and section 9 of KPID produced at Annexure 'BC';

(4) Issue a writ of certiorari or any other appropriate writ, quashing Government Order bearing No. DPAR 89 SPS 2019 dt: 07.01.2020 according sanction under section 17(A)(b) of the Prevention of Corruption Act, 1988 against the Petitioner herein produced at Annexure 'AU';

(5) Issue a writ of certiorari or any other appropriate writ, quashing FIR bearing No.RC0372020A0005 dt: 01/02/2020 registered by the 2nd Respondent against the Petitioner herein pending on the file of CBI SPL Court (CCH 4) produced at Annexure 'AV' for offences u/s 7, 7(A), 8, 10, 11 and 12 of the PC Act, 1988 (as amended in 2018) and for offences u/s 13(2) r/w 13(1)(d) PC Act, 1988 arraying the Petitioner herein in the said FIR as Accused No.5.

(6) Grant such other relief as are just in the circumstances of the case.

2. The facts leading to the writ petition are as follows:-

(i) The respondent No.2 - CBI filed a FIR in RC0372020A0005/2020 against 11 accused persons on 01.02.2020 under section 120B IPC, sections 7, 7(A), 8, 10, 11 & 12, 13(2) r/w. 13(1)(d) of Prevention of Corruption Act, 1988 (as amended in 2018). The petitioner herein was shown as accused No.5 therein. The allegations leveled against the petitioner / accused No.5 was that he being the IGP, CID had forwarded the enquiry report of Sri. E.B. Sridhara (A-4) to the State DG & IGP on 18.01.2019 asserting that the enquiry did not find any wrongdoings on the part of the IMA group of entities to invoke the provisions of Karnataka Protection of Interest of Depositors in Financial Establishment Act, 2004 (hereinafter referred to a "KPID Act") against them; he categorically maintained that the deposits collected by the IMA group of entities were exempted under Section 2(2)(ii) of the KPID Act; he did not mention about the deposits collected by the IMA Proprietorship owned by Shri Mohammed Mansoor Khan (A-6) in his report.

(ii) This report was not accepted by the RBI, which in turn addressed another letter dated 02.04.2019 to the DG & IGP stating that the RBI sought comprehensive enquiry by State CID on the unauthorized deposits collected by the IMA group entities. But the petitioner (A-5) did not oblige to the request made by the RBI and asserted that there was no requirement to re-look into the issue of IMA and again sent his earlier report to the DG & IGP on 25.05.2019.

(iii) According to the respondent, the reluctance on the part of the Public Servants, namely Shri M. Ramesh (A-1), the then Inspector of Police/SHO, Commercial Street Police Station, Bengaluru; Sri Ajay Hilori (A-2), the then Deputy Commissioner of Police, Bengaluru East; Shri Gowrishankar (A-3), the then Sub-Inspector of Police, Commercial Street Police Station, Bengaluru; E.B. Sridhara (A-4), Deputy Superintendent of Poli

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