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2014 Supreme(Mad) 1989
High Court of Judicature at Madras
ARUNA JAGADEESAN, J.
CBI, Bank Securities and Frauds Cell
Versus
Ambarish Singh Ahluwalia The then Debt Recovery Manager SBI GFL Bandra (East), Mumbai
Crl.RC.No. 1000 of 2013
Decided On : 14-07-2014
For the Petitioner: N. Chandrasekharan, SPP.
For the Respondent:K.K. Sivashanmugam, Advocate.
The main legal point established in the judgment is the requirement of a strong suspicion and a nexus with corruption or misuse of position to establish an offence under the Prevention of Corruption Act.
Headnote:
Criminal Revision Case - Discharge of Accused - Sections 120B, 420, 467, 468, 471 of IPC and Section 13(2) read with 13(1)&(d) of the Prevention of Corruption Act - The court discussed the legal provisions related to framing of charges, duty of the court at the initial stage, and the requirement of sufficient ground for proceeding against the accused. The court emphasized the need for a strong suspicion to frame charges and the necessity of a nexus with corruption, illegality, or misuse of position to establish an offence under the Prevention of Corruption Act.
Fact of the Case:
The Respondent/A5, a Manager at a non-banking financial company, was charged with conspiracy and illegal gratification in a factoring facility loan case. The Prosecution alleged that the accused concealed the non-existence of debtor firms and received illegal gratification.
Finding of the Court:
The court found that there was no material to establish the accused's involvement in the loan transaction or conspiracy. The court also noted that the concealment of non-existence was not supported by evidence and the alleged illegal gratification did not establish a corrupt or illegal means or abuse of official position.
Issues: The issues revolved around the sufficiency of grounds to proceed against the accused, the requirement of a strong suspicion, and the need for a nexus with corruption or misuse of position to establish an offence under the Prevention of Corruption Act.
Ratio Decidendi: The court emphasized the need for a strong suspicion to frame charges, the requirement of a nexus with corruption or misuse of position to establish an offence under the Prevention of Corruption Act, and the duty of the court to examine evidence at the initial stage without rebuttal.
Final Decision: The court dismissed the criminal revision, upholding the discharge of the accused, and found no illegality or perversity in the order passed by the trial court.
This Criminal Revision Case is filed by the Central Bureau of Investigation against the order dated 30.4.2013 passed by the learned II Additional District Judge (CBI Cases) Coimbatore in Crl.MP.No.1152/2011 in CC.No.9/2011, discharging the Respondent/A5 from the charges levelled against him and to order framing of charges against the Respondent/ Accused.
2. The Respondent herein was employed as a Manager in the Debt Recovery Department of M/s.Global Trading Finance Limited (herein after referred to as M/s.GTFL), a Public Limited non banking financial Company. The said M/s.GTFL advanced a factoring facility of Rs.14.50 crores to A4 Company i.e. M/s.Kundrakudi Kandha Spinning Mills P Limited (herein after referred to as M/s.KKSMPL/A4 Company), in which, the A2 and A3 are the Managing Director and Director respectively.
3. As per the factoring facility of loan, the creditor borrower avails factoring facility of loan from the non banking financial Company at the discounted rate from the credit invoices raised against its debtors. The debtors, who are indebted to the creditor borrower, shall repay the credit invoice value to the non banking financial Company. The primary liability of repayment rests upon the debtors. The non banking Company which advanced the factoring facility may take recourse against the borrower creditor Company as well.
4. A criminal case was registered against A1 S.Arivarasu, the then Vice President and Branch Head, M/s.SBI Global Limited, Coimbatore Branch, A2 P.Venkatachalapathy, Managing Director and A3 Director of M/s.KKSMPL/A4 Company and others under Sections 120B read with 420, 467, 468 and 47 of IPC and Section 13(2) read with 13(1)&(d) of the Prevention of Corruption Act on the written complaint made by B.Surendran, Vice President Branch Head M/s.SBI Global Factors Limited, Coimbatore, regarding fraudulent transactions in the Trade Finance Account of A4 Company (presently known as Kandha Spinning Mills) held at M/s.SBI Global Factors Limited (previously known as M/s.Global Trade Finance Limited) Coimbatore Branch.
5. After investigation, charge sheet was filed against the Respondent herein, who was arrayed as A5 and others for the offences as stated above. As per the Prosecution case, M/s.KKSMPL/A4 represented by its Managing Director A2 had availed factoring facility of Rs.15 crores from M/s.GTFL, Mumbai. The accused had entered into a criminal conspiracy with S.Arivarasu (A1) the then Business Development Manager of M/s.GTFL, Coimbatore in availing factoring facility of Rs.15 crores from M/s.GTFL. M/s.KKSMPL/A4 has defaulted in making repayment of Rs.17.36 crores thereby caused wrongful loss to M/s.GTFL, Mumbai and obtained corresponding wrongful gain for themselves. It is the case of the Prosecution that the accused persons were parties to the criminal conspiracy hatched at Coimbatore to cheat M/s.GTFL for obtaining pecuniary advantage in favour of A4 Company.
6. The Respondent (A5) herein was the Manager (Debt Recovery) at M/s.GTFL from 19.6.2006 to 12.10.2009. He was responsible for recovering debts in respect of A4 Company. There were instances of cheque bounces in respect of A4 Company and its debtors units and the same was informed to him by the Operation Department of M/s.GTFL, Mumbai. For the purpose of effecting the recovery, he had visited the corporate Office of A4 Company and the offices of M/s.Tirupthi Fabrics and five other debtors located at Udumalpet. A5 was aware that A4 Company and the six debtors firms were not in existence and no business activity was going on. He had concealed this fact and did not submit a report regarding the non existence of M/s.KKSMPL/A4 and six debtors firms.
7. According to the Prosecution, he had received Rs.37.38 lakhs as illegal gratification from A4 Company and others through the accounts of his parents viz. D.S.Ahluwalia (A10) and Jasbir Ahluwalia held at ICICI Bank at Nagpur. He has not intimated to his controlling authorities in M/s.S
