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IN THE HIGH COURT OF JUDICATURE AT MADRAS
R. SUBBIAH, J.
Mr. K.Kuberanathan – Petitioner
Versus
State : rep. by Deputy Superintendent of Police SPE:CBI/BS & FC, Bangalore -
Respondent
Crl.R.C.Nos.709 of 2013 & 840 of 2016 and Crl.M.P.Nos.6369 & 6370 of 2016
Decided On : 07-10-2016
Criminal Revision Cases - Discharge petitions under Section 239 of Cr.P.C. - Sections 120B, 420 IPC, and Sections 13(2) r/w 13(1)(c)(d) of the Prevention of Corruption Act, 1988 - The case involves a criminal conspiracy to cheat Indian Bank and cause a loss of Rs.190 crores. The accused are charged with facilitating the siphoning of money and dishonestly concealing information from the bank. The Court analyzed the settlement of the amount, the applicability of Section 188 of Cr.P.C., and the incomplete investigation due to pending replies to Letter Rogatory from foreign countries.
Fact of the Case:
The case involves a criminal conspiracy to cheat Indian Bank and cause a loss of Rs.190 crores. The accused are charged with facilitating the siphoning of money and dishonestly concealing information from the bank.
Finding of the Court:
The Court found that the settlement of the amount does not absolve the accused from criminal liability. The accused cannot be discharged merely on the ground of settlement. The Court also held that the prior sanction from the Central Government under Section 188 of Cr.P.C. is not required as the major part of the allegations took place in India. The Court acknowledged the incomplete investigation due to pending replies to Letter Rogatory from foreign countries.
Issues: The issues revolve around the settlement of the amount, the applicability of Section 188 of Cr.P.C., and the incomplete investigation due to pending replies to Letter Rogatory from foreign countries.
Ratio Decidendi: The settlement of the amount does not absolve the accused from criminal liability. The prior sanction from the Central Government under Section 188 of Cr.P.C. is not required as the major part of the allegations took place in India. The incomplete investigation does not preclude the maintainability of the final report.
Final Decision: Crl.R.C.No.840 of 2016 is allowed, and the petitioner/A16 is discharged from the case. Crl.R.C.No.709 of 2013 is dismissed, and the petitioner/A3 is directed to approach the Trial Court for dispensing with his personal appearance.
These Criminal Revision Cases have been filed by the petitioners challenging the orders of dismissal dated 07.02.2013 & 29.04.2016 in Crl.M.P.No.2055 of 2008 and Crl.M.P.No.2298 of 2014, respectively, in C.C.No.64 of 2001, passed by the learned Principal Special for CBI Cases, Chennai, in and by which, the discharge petitions filed by the petitioners herein under Section 239 of Cr.P.C., were dismissed.
2. The petitioner in Crl.R.C.No.709 of 2013 has been arrayed as 3rd accused and the petitioner in Crl.R.C.No.840 of 2016 has been arrayed as 16th accused in the case in C.C.No.64 of 2001 pending on the file of the learned Principal Special for CBI Cases, Chennai.
3. Since some of the submissions made by the counsel for the petitioners are common in respect of both the petitioners/accused, these Revision are disposed of by way of this common order. For the sake of convenience, the petitioners are hereinafter referred to as per their rankings before the Trial Court viz., 3rd Accused & 16th Accused respectively.
4. The brief facts of the case of the prosecution are as follows_
4-1.The case has been registered against the accused persons by the respondent-CBI, in R.C.No.8 & 9(E)/1996 on the source information. The 3rd accused was the Branch Manager, Indian Bank, Muthialpet Branch, Chennai and the 16th accused is the Director of a company viz., M/s. Sadeco Sari Pvt. Ltd., Singapore, during the relevant period.
4-2.The group of companies viz., M/s. MVR Exports Pvt. Ltd./MVR Industries Pvt. Ltd. and Ms. Maxwell Promotion/Maxwell Exim Pvt. Ltd., approached Indian Bank, Muthialpet Branch, Chennai for Packing Credit facilities with sales contracts signed with Singapore based companies. Similarly, they approached the Bank for Import LC facility with purchase contracts signed with the Singapore based companies. These sales contracts/purchase contracts were signed on behalf of MVR Exports Pvt. Ltd./MVR Industries Ltd. by G.S.Kumar (A10) and on behalf of M/s. Maxwell Promotion/Maxwell Exim Pvt. Ltd. by S.Madhusoodan (A13) etc. On behalf of the Singapore based companies, the purchase/sales contracts were signed by one P.Vijayaraghavan (A15), V.R.Usha (A14), B.Chandramouli (petitioner herein/A16), M.A.J.X.Basil (A17). Though the purchase and seller companies belonged to the same group controlled by M.Varatharajaloo (A7), this fact was dishonestly concealed from Bank.
4-3.M/s. MVR Exports Pvt. Ltd./MVR Industries Ltd. and M/s. Maxwell Promotion/Maxwell Exim Pvt. Ltd., imported raw cashew nut from cashew producing countries in West Africa, Indonesia, Veitnam etc and exported processed cashew kernels to USA, UK, Netherlands, Japan, HongKong etc., and both imports and exports were only billed through their group-companies in Singapore, whereas the consignments never reached Singapore.
4-4. In pursuance of the criminal conspiracy entered into among the accused persons, M.Varatharajullo (A7) managed to get another company under the name and style of M/s. Sadeco Sari Pvt. Ltd. incorporated at Singapore on 18.02.1991 and in furtherance of the conspiracy, the petitioner/A16 was inducted as Director in the said company viz., M/s. Sadeco Sari Pvt. Ltd. The Board of Directors of the Bank sanctioned various credit facilities including FBP-DA in favour of the said company on 04.04.1992. The Board, in its meeting held on 04.06.1994, renewed sanction of the limits as a single line of credit subject to a Maximum of US $ 10 million. Initially, the Directors of the company including the petitioner/A16 have extended personal continuing guarantee for the company and subsequently on 07.08.1996, Smt.V.R.Usha (A14) and M.V.Raja (A7) signed personal continuing guarantee for the company.
4-5. On some of the bills/goods, Maxwell Exim availed export finance in India. Using the same bills of lading, Singapore Companies namely Mountamount (Singapore) Pvt. Ltd., Sadeco Sari Pvt. Ltd. and Nagova Exim Pvt. Ltd. have also availed export finance from Indian Bank, Singapore Branch
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