SHALINI PHANSALKAR JOSHI, J.

1. This Special Case is fall out of the financial scam, that affected the economy of the country in the year 1991-92.

2. This particular scam pertains to the 'Securities Transactions', entered into by the Standard Chartered Bank, through its Broker - Accused No.3 Hiten Dalal, with various other counter-party Banks like Bank of Karad, Metropolitan Co-operative Bank and HSBC Bank.

3. The case is registered on the complaint of Mr. P.S. Nat, the then Chief Executive Officer - India of the Standard Chartered Bank, Mumbai. It was lodged on 20th June 1992 and addressed to the D.I.G., C.B.I., Mumbai.

4. The allegations set out in the 'Complaint' are as under;

The Division of the 'Standard Chartered Bank' (SCB) in India, known as 'Investment Banking Division', was situate at M.G. Road, Mumbai, within which there was a 'Money and Investment Unit' (MIU), consisting of 'Front-Office' and 'Back-Office'. The transactions in securities were concluded by the 'Dealers' in the 'Front-Office' and they were executed by the Officers in the 'BackOffice'. Since March, 1989, Accused No.3 - Hiten Dalal was operating as t-e 'Broker' in respect of the 'Securities Transactions' of this Bank; whereas, Accused No.7 - Arvind Mohanlal was functioning as the 'Manager' of 'MIU Front-Office', under whose supervision, there were four different 'Dealers'.-Accused No.8 - Jaideep Pathak (Since Deceased) was working in the 'Back-Office' as 'Processing Officer' and, therefore, designated as 'Manager' of the 'Back-Office'. Accused No.17 - Santosh Mulgaonkar was working as a 'Staff Officer' in the Back-Office.

5. During the relevant period, Accused No.1-Bhupendra Dalal and Accused No.4-A.D. Narottam were the 'Brokers' and the 'Directors' of BOK. Accused No.13-Ramaswamy was the 'Broker' of BOK and also the 'Proprietor' of M/s. Excel & Co. Accused No.15- Naresh Agarwal was the 'Broker' of HSBC Bank and Accused No.16- G.N. Hegde was working as 'Share and Stock-Broker'.

6. Accused No.6-Kapadia was working as 'Vice-Chairman' and Accused No.14-Vyas was working as 'Director' of M/s. M-tropolitan Co-operative Bank Ltd., Mumbai (MCB).

7. Accused No.9-Ruia was the 'Broker' and also the 'Director' of M/s. Dhanraj Mills (P) Ltd., Mumbai.

8. Accused No.10-Sudhakar and Accused No.11-Raje were working as 'Clerk' and 'Manager', respectively, in the Bank of Karad Limited, Securities Division, Fort Bran-h, Mumbai (BOK).

9. As per prosecution case, as set out in the 'Complaint' [Exhibit-471] of PW-28 P.S. Nat, the Chief Executive Officer - India of SCB, on 30th April 1992, Accused No.7-Arvind Mohanlal had approached Mr. Ravi Iyer, the then Director, Local Currency Group of the Bank, and made some startling revelations to the effect that, in a series of transactions put through by the Bank, through Broker - Hiten P. Dalal, stocks worth about Rs.300 crores remained unaccounted for. It was so, as the Bank had neither received the securities, nor received Bank Receipts regarding purchase thereof from the counter-party Banks, even though the Bank had paid for the same.

10. In this background, the matter was taken up by the Bank with Accused No.3-Hiten P. Dalal, who promised that whilst the Bank was enduring to establish its exact position, he would handover Bank Receipts for the shortfalls already identified. He further delivered to the Bank, Shares, Debentures and Securities held by him. He also promised to deliver further such stocks. This fact was also confirmed by him in his letter dated 11th May 1992, addressed to the Bank. According to the Complainant - Mr. Nat, in the meeting held between the Officers of SCB, arranged by Accused No.3-Hiten, with other accused, namely, Accused No.1-Bhupendra, Accused No.4-Narottam and Accused No.9-Ruia, Accused No.9-Ruia admitted having received a sum of Rs.90 to Rs.125 crores from A.D. Narottam, out of the proc