The validity of sanction for prosecution is crucial, requiring the sanctioning authority to independently assess allegations and evidence, failing which proceedings are deemed null.

1. These petitions were filed by A - 1 and A - 2 under S. 482 Cr. P.C. to quash the proceedings against them in C.C. No. 81/86 on the file of the Principal Special Judge for SPE and ACB Cases, Hyderabad, which is now transferred to the Court of the 1st Addl. Special Judge for SPE and ACB cases, Hyderabad, and re - numbered as C.C. No. 19/87. A charge - sheet has been filed against the petitioners (A - 1 and A - 2) and three others by the Inspector / CBI : CIU (i) New Delhi, alleging that they have committed the offences punishable under S.120 - B read with S. 420 IPC, 161 IPC, 165 IPC and S. 5(2) read with S. 5(1)(d) of the Prevention of Corruption Act .

2. A - 1 (Petitioner in Crl. MP No. 111/87) who is now working as General Manager, Andhra Bank, worked as Dy. General Manager, Andhra Bank, Central Office, Sultan Bazar, Hyderabad, from 1980 to 11-3-1983. A - 2 (Petitioner in Crl. MP No. 397/87) worked as Branch Manager, Andhra Bank, Ramanthapur Branch, Hyderabad, from May, 1980 to May, 1984. A - 3 worked as Rural Credit Officer, Andhra Bank, Nizamabad, from July, 1982 to July, 1983. A - 4 was an Approved Valuer of the Andhra Bank during the year 1982-83. A - 5 is a Civil contractor during the aforesaid period.

3. The prosecution case is that A - 1 to A - 4 entered into a criminal conspiracy at Hyderabad with an object to cheat the Andhra Bank and to cause huge pecuniary advantage to N. V. Choudary (A - 5) in the matter of sanction of loan facilities to A - 5 and his associate concerns during the period 1981 to 1983. In the matter of sanction of tipper loans, A - 2 took oral permission of A - 1 and released the loans. A - 1 allowed decrease in the rate of interest for payment of loans by reducing it to 15% and further increased the number of instalments for repayment of loans after the sanction of loan facilities. For the loan facilities, the house property of A - 5 situated at E - 1 Kakatiyanagar, Habsiguda, Hyderabad, was the collateral security. In pursuance of the criminal conspiracy, A - 1 and A - 2 recommended and enhanced the secured over - draft limit of A - 5 from Rs. 1.5 lakhs to Rs. 3 lakhs and recommended renewal of bank guarantee limit of Rs. 4.4 lakhs and further allowed the release of bank guarantee limit up to Rs. 5 lakhs against the security of the house at Kakatiyanagar.

4. As part of the conspiracy, A - 5 applied to the Andhra Bank, Ramanthapur Branch, on 2-11-1982 for grant of facilities of bank guarantee limit to the extent of Rs. 98 lakhs and secured over - draft facility to the extent of Rs. 10 lakhs. A - 5 required those facilities for the execution of the contract works he had with M/s. Hindustan Steel Works Ltd., Visakhapatnam. A - 5 offered to pledge different properties worth Rs. 1.4 crores which include his house property at Kakatiyanagar worth Rs. 30 lakhs. A - 2 made an assessment of the value of the properties of A - 5 and submitted his estimate to the extent of Rs. 57.5 lakhs and recommended for a bank guarantee limit of Rs. 33 lakhs and secured over - draft facility of Rs. 3 lakhs in favour of A - 5 which was later on sanctioned by the Board of Directors and the sanction was conveyed vide letter dated 13-12-1982. The properties that have been shown by A - 5 have to be valued by the Approved Valuer followed by the opinion of the Legal Adviser. A - 4 evaluated the house property of A - 5 and the different properties situated at Nacharam on 14-12-1982 on inflated rates and the same was accepted as security before obtaining legal opinion. A - 3 who is one of the persons in this conspiracy, valued the agricultural property o