2012 Supreme(Guj) 409

IN THE HIGH COURT OF GUJARAT
Hon’ble Mr. Justice Rajesh H. Shukla
Yes Bank Limited Thro’ Mr. Hemal Desai & Anr.
Versus
State of Gujarat & Anr.
Special Criminal Application No. 695 of 2012—Decided on 29/08/2012

Point in Issue :
Whether in the facts and circumstances of the case impugned order of CJM in Criminal Case No. 21540/2010 dated 12.10.2009 is liable be set aside and quashed.

Headnote:(a) Constitution of India, 1950 — Article 226 — Criminal Procedure Code, 1973 (Central Act 2 of 1974) — Sections 202, 204 and 482 — Quashing and setting aside the criminal proceedings — Alleging no benefit to petitioners and loss to Respondent No. 2 was on account of global economic recession — Finding of — Sustainability — In the matter there was specific instructions that amount invested in Mutual Fund may be redeemed, still Petitioner No. 2 having obtained signatures of Respondent No. 2 on memo for redemption misused the same which shows its criminal intention — In the process Petitioner No. 1 Bank has helped Petitioner No. 2 to achieve its business target for personal gain — In the circumstances when proceedings are initiated it can not be permitted to be scuttled in exercise of inherent powers and extra ordinary jurisdiction specially when petitioners will have ample opportunity of being heard to defend.

       Held :

       When the customer had asked for the redemption of the investment in the mutual funds and when the Petitioner No. 2 is said to have prepared a slip, the investment should have been redeemed. However instead of such redemption, the mandate of the bank has been changed from Bank of Baroda to Yes Bank (the Petitioner No. 1 Company) and the amount has been diverted or used. Therefore, it would not be a valid justification to come forward saying that the amount has been invested but it has resulted into loss due to market fluctuation and, hence, it would require a close scrutiny. If such a thing is accepted, it would be adding an insult to the injury caused to the Respondent No. 2 being investors, relying upon the Experts, who are rendering such services.

       In the facts of the case, inspite of the instruction regarding the redemption when the mandate has been changed so as to convert the investment funds would certainly a ground to raise some doubt, which would be a subject of scrutiny at an appropriate stage before the trial court. Therefore, without expressing any opinion, it would not be desirable to jump to any conclusion at this stage in the present petition. At the same time, the submission that there is no mens rea or the ingredients for the offences are not attracted cannot be accepted at the face value as rightly emphasized by learned counsel. [Para 14]

       Considering the material and the rival submissions, the present petition cannot be entertained without allowing the matter to have its own recourse when both the side will have opportunity. In fact, it is necessary and desirable that both the side should have opportunity in further proceeding before the trial court, which can decide on proper appreciation and scrutiny of the evidence. [Para 16]

       (b) Words and Phrases — Caution — Meaning and scope of — While using power under Section 482 Criminal Procedure Code and Article 226 of Constitution.

       Held :

       It would not be desirable to quash the Criminal Case No. 21540/2010 as prayed in exercise of extra ordinary jurisdiction under Article 226 of the Constitution of India or in exercise of inherent powers under Section 482 of the Code, which is very limited. In catena of judicial pronouncement, the Hon’ble Apex Court has time and again expressed the word of ‘caution” that it has to be exercised with care and circumspection. If such powers are exercised lightly in such cases, it would amount to permit one of the side to scuttle the judicial process at the threshold without any material. On the other hand, if it is allowed to proceed, it will give sufficient opportunity to both sides as stated above and it cannot be said that any such complaint or the proceedings initiated are either mala fide or by way of abuse of the process of the Court. [Para 17]

       Law Laid Down :

       When charge sheet prima facie discloses the commission of offence the Court should interfere to settle the process.