The court upheld that charges under criminal conspiracy can be framed based on prima facie evidence, and the burden is on the prosecution to show substantial suspicion to proceed to trial.

JUDGMENT :

SAURABH BANERJEE, J.

1. By way of the present petition under Section 482 read with Section 397 of the Code of Criminal Procedure, Hereinafter referred to as ‘Cr.P.C.’, the petitioners seek setting aside of the order dated 07.09.2022 passed by the learned Special Judge (PC Act) (CBI)- 07, Rouse Avenue Court, New Delhi, Hereinafter referred to as ‘Trial Court’ in CC No.375/2019 whereby charges were framed against the petitioners under Section 120B read with Sections 420 /468/471 of the Indian Penal Code, Hereinafter referred to as ‘ IPC ’ and under Section 13 (2) read with Section13(1)(d) of the Prevention of Corruption Act.

2. An FIR bearing no.RC-09/A/2017 dated 21.06.2017 came to be registered on the basis of written complaint of one Sh. S.K. Mehta, Deputy General Manager, Corporation Bank, Zonal Office, Delhi (South), Hereinafter referred to as ‘Bank’, wherein it was alleged that in March 2013, one Sumit Mittal, projecting himself to be the proprietor of M/s. Shree Balaji Overseas, Hereinafter referred to as ‘borrower firm’, approached the Bank seeking working capital finance of Rs.600 lakhs. The said loan proposal was sanctioned by the Bank on 19.04.2013, stipulating hypothecation of stock-in- trade and EMG of property bearing no.A-68, measuring 138.17 sq. mtrs., situated at Pushpanjali Enclave, Pitampura, Delhi, in the name of Sh. Sat Narayan Mittal. Pursuant thereto, on 26.04.2013, the Vasant Kunj branch of the Bank disbursed a Corp. Vyapar Loan of Rs.600 lakhs to the account of the borrower firm.

3. It was further alleged that during inspection of the said loan account certain suspicion arose which led the Bank to initiate an internal inquiry which disclosed various serious irregularities. It was found that the loan was applied on the basis of forged and fabricated documents, which were not verified before sanctioning of the loan. The title documents of the property which was offered as collateral were also found to be fabricated. The said loan was sanctioned in violation of various Circulars and Guidelines.

4. During the course of investigation, it emerged that the borrower firm and its proprietor were fictitious/ non-existent. It was further revealed that the said Sumit Mittal, along with certain senior Bank officials at the Vasant Kunj Branch, CCPC and ZLCC, Delhi (South), and other private person, including the petitioners, had entered into criminal conspiracy to unlawfully get a loan of Rs. 600 lakhs sanctioned on the basis of false and fabricated documents.

5. The petitioner no.2, through its authorised signatory petitioner no.1 were engaged by the Bank as a due diligence agency and were entrusted with the physical as well as financial due diligence of the loan applicants. The petitioners, without undertaking any genuine physical or financial verification, have deliberately issued a favourable Due Diligence Report dated 29.03.2013, Hereinafter referred to as ‘Report’ in respect of Sumit Mittal and its firm M/s. Shree Balaji Overseas so as to facilitate sanction of the loan.

6. Thereafter, with the aforesaid findings, chargesheet dated 25.03.2019 was filed and vide order dated 07.09.2022 charges were framed against the petitioners. Aggrieved by the same, the petitioners have approached this Court by way of the present petition.

7. Mr. Naman Gupta, learned counsel for the petitioners advanced his submissions and contended that :-

i. the petitioner no.2 was empanelled as a due diligence agency by the Bank in the