The court upheld the trial proceedings against the accused, confirming that substantial prima facie evidence supported the allegations of fraud and conspiratorial acts despite claims of settlements.

ORDER :

J. M. Khazi, J.

These two petitions are filed under Section 482 of the Code of Criminal Procedure to quash the criminal proceeding initiated in C.C.No.838/2016 on the file of JMFC-2, Belagavi by setting aside order dated 27.09.2016 by the said Court taking cognizance against the accused.

2. While Crl.P.No.101198/2017 is filed by accused No.1, Crl.P.No.101199/2017 is filed by accused Nos.3 to 5.

3. Since these two petitions are arising out of the same case and involve common discussion, they are clubbed together and disposed of by a common order.

4. For the sake of convenience, parties are referred to by their ranks before the trial Court.

5. In support of the petition, accused Nos.1, 3 to 5 have contended that even if the entire prosecution case is accepted in its totality, no offence under Sections 467 , 468 and 471 IPC is made out. There is no evidence of false document or forged document to attract Section 464 of IPC . The prosecution has not verified whether the power plant was completed by BCL. In the absence of proof that the power plant does not exist, the allegation of diversion of funds is not established. No reasons are assigned by the trial Court to the effect that there is a material to take cognizance. The absence of visit by the investigating officer to the subject power plant, the prosecution has failed to substantiate allegation of diversion of funds. M/s Rao Srinivasan and Associates have given report regarding proper utilisation of funds and execution of the work for which payments have been made to M/s Bhaskar Jadhav Contractors, M/s Dhananjay Industries and Deshmukh contractors.

6. Having regard to the nature of the evidence collected during the investigation, there is every likelihood of prosecution not able to prove the allegations. There is also delay of more than 15 years and the fundamental right of the accused is violated. Given the large number of witnesses, several years may take to dispose of the case. There is no material to prove the allegation of conspiracy. In fact, BCL has arrived at a settlement of all its dues with the bank by paying Rs.15 Crores and there is no claim of the bank against the accused persons.

7. In support of arguments, on behalf of the accused persons, learned Senior counsel representing them has relied upon the following decisions:

(i) CBI Vs. Duncans Agro Industries Ltd (Duncans Agro), (1996) 5 SCC 591 .

(ii) G.Sagar Suri Vs. State of U.P. (Sagar Suri), (2000) 2 SCC 636 .

(iii) B.S.Joshi Vs. State of Haryana (B.S.Joshi), (2003) 4 SCC 675 .

(iv) Pankaj Kumar Vs. State of Maharashtra (Pankaj Kumar), (2008) 16 SCC 117 .

(v) Nikhil Merchant Vs. CBI (Nikhil Merchant), (2008) 9 SCC 677 .

(vi) Mohd. Ibrahim Vs. State of Bihar (Mohd.Ibrahim, (2009) 8 SCC 751 .

(vii) Shiji alias Pappu & Ors Vs. Radhika and Anr (Shiji alias Pappu, (2011) 10 SCC 705 .

(viii) CBI Vs. Narendra Lal Jain (Narendra Lal Jain, (2014) 5 SCC 364 .

(ix) Gold Quest Internation Pvt. Ltd. Vs. State of Tamil Nadu & Ors. (Gold quest, (2014) 15 SCC 235 .

(x) Vesa Holdings (P) Ltd Vs. State of Kerala (Vesa Holdings, (2015) 8 SCC 293 .

(xi) Tarina Vs.Union of Indian & Anr (Tarina, 2024 SCC Online SC 2696.

8. CBI has filed statement of objections stating that the petitions are not maintainable either in law or on facts and liable to be dismissed with exemplary cost. Based on the source information, on 26.04.2002 case came to be registered in RC.1(E)/2002 for the offences punishable under Sections 120-B r/w 420, 467, 468 , 471 IPC and Section 13 (2) r/w 13(1)(d) of PC Act 1988. It is time that the Directors of M/s Belgundi Cement Pvt Ltd (‘BCPL’ for short) availed credit facilities