Criminal liability under the Prevention of Corruption Act requires proof of mens rea; mere participation in decision-making without evidence of corrupt intent does not establish a prima facie case for criminal misconduct.

JUDGMENT :

AMIT MAHAJAN, J.

1. The present petition under Section 482 of the Code of Criminal Procedure, 1973 (‘CrPC’) is filed seeking quashing of RC No. BD121016E0001 registered under Sections 120B/420/467/468/471 of the INDIAN PENAL CODE , 1860 (‘IPC’) read with Sections 13 (2) and 13(1)(d) of the Prevention of Corruption Act, 1988 (‘PC Act’), and the consequential proceedings arising therefrom, pending before the learned Additional Sessions Judge, Tis Hazari Courts, New Delhi.

2. The Petitioner, superannuated honorably as an Executive Director of Canara Bank on 31.10.2014. The prosecution stems from default on repayment of loan sanctioned to M/s Occasion Silver Pvt. Ltd. (OSPL) in the year 2013. It is stated that the petitioner was not named in the original RC and has been implicated based on his role in the ED-CAC (Executive Director-Credit Approval Committee) which sanctioned the proposal for loan to OSPL.

Brief Facts

3. Succinctly stated, on 04.09.2013, OSPL, engaged in the wholesale and retail trading of silver jewellery and articles, gold, diamond and imitation jewellery, crockery, and gift items, submitted a proposal to Canara Bank, Kamla Nagar branch, for a working capital facility of Rs.60 crores. Subsequently, on 14.09.2013, the branch forwarded the new business proposal to the Circle Office, Delhi, for appraisal. The Credit Committee at the Circle Office on evaluating the proposal on 18.09.2013, recommended it to the New Business Approval Committee (NBAC) at the Head Office, Bangalore.

4. On 26.09.2013, the NBAC accorded in-principle approval in the form of an ‘Expression of Interest’ for the proposed limit of Rs.60 crores, with sub-limit for book debts of Rs.30 crore, subject to standard sanction conditions. This approval was communicated back to the Circle Office on 30.09.2013, which then conveyed it to the Kamla Nagar Branch. Accordingly, the Branch submitted a regular proposal for sanction of the same working capital limit, including a sub-limit of Rs.30 crores towards book debts.

5. On 19.10.2013, the General Manager–Credit Approval Committee (GM-CAC), Circle Office, recommended the revised proposal to the Corporate Credit Group (CCG) at the Head Office. The CCG, comprising senior General Managers, considered the same in a meeting held on 16.11.2013, and recommended it for final sanction by the Executive Director–Credit Approval Committee (ED-CAC). This proposal was one among 30 credit proposals across various regions, including Delhi, being considered.

6. On 21.11.2013, the ED-CAC, including the petitioner who was then serving as Executive Director, convened to deliberate on the proposal. The petitioner’s secretariat, after internal review, had noted that the proposal ought to be declined in view of the high volatility of the silver market and inadequate collatera