Criminal liability under Sections 420 IPC is negated by repayment of loans, indicating lack of wrongful loss to the bank.

ORDER:

1. This instant Criminal Revision Case has been preferred against the order, dated 22.06.2012, passed by the learned II Additional Judicial Magistrate of I Class, Eluru, in Criminal M.P.No.466 of 2012 in C.C.No.812 of 2011, whereby the learned Magistrate dismissed the application filed by the petitioners under Section 239 of the Code of Criminal Procedure

2. THE BRIEF FACTS OF THE CASE ARE THAT

a. Petitioners Nos.1 to 5 are the Managing Directors and other officials of M/s.Bhimavaram Hospitals Limited, Bhimavaram, West Godavari District. Petitioner No.6 is the Bhimavaram Hospitals Limited itself.

b. On a written complaint of the Regional Manager, Region-VI, State Bank of India, Administrative Unit, Vijayawada, dt.10.06.2009, the Central Bureau of Investigation has registered a case in RC-05(E)/ 2009-CBI/ BS & FC/ Bangalore, against the present petitioners and other unknown officials of State Bank of India, Bhimavaram Branch, for the offences punishable under Section 120-B read with Sections 420 , 468 and 471 of the Indian Penal Code, 1860 (for short „I.P.C.‟) and Section 13 (2) read with (1)(d) of the Prevention of Corruption Act, 1988 .

c. After completion of investigation, the Central Bureau of Investigation has submitted a charge sheet before the II Additional Judicial First Class Magistrate, Eluru, on 14.05.2011, wherein the present petitioners were cited as Accused Nos. 1 to 5. No bank officials were cited as accused on the ground that sanction for prosecution was not accorded by the Vigilance Commissioner against them. The learned Magistrate has taken cognizance of the offence and numbered the charge sheet as C.C. No.812 of 2011.

d. Thereafter, the petitioners filed an interlocutory application, vide Crl.M.P.No.466 of 2012, before the learned Magistrate under Section 239 of the Code of Criminal Procedure, 1973 (for short „Cr.P.C.‟), seeking discharge from the criminal case. The said application was dismissed by impugned order dt.22.06.2012. Aggrieved thereby, the present Criminal Revision Case has been preferred.

3. Heard the submissions of the learned counsel for the petitioners and the learned Special Public Prosecutor appearing for the respondent and perused the record.

4. SUBMISSIONS ON BEHALF OF THE PETITIONERS:

a. At the outset, the learned counsel for the petitioners submits that the learned Magistrate has committed an error in not discharging the petitioners from the criminal case. Further contention of the petitioners is that the ingredients of the offence under Section 120-B I.P.C., and the substantive offences under Sections 420 , 468 and 471 IPC , alleged in the charge sheet, are not made out.

b. Secondly, it is submitted that that since no bank officials of State Bank of India, Bhimavaram Branch, were charge sheeted and the Vigilance Commission refused sanction to prosecute the bank officials, the entire charge sheet against the present petitioners cannot be sustained.

c. Finally, it is submitted that inspite of several materials before the Court below that loan sanctioned by the State Bank of India had already been fully repaid and there is no wrongful loss to the bank and no wrongful gain to the petitioners, continuation of the criminal proceedings would be a futile exercise.

d. In support of his submissions, the learned counsel relied upon several judgments of the Hon‟ble Supreme Court, wherein criminal proceedings were quashed and the accused were discharged when the bank loans had already been repaid. It is further submitted that there are several materials before the Investigating Agency that prior to submission of charge sheet, the Bhimavaram Hospitals Limited has repaid the loan amount availed from the Sta