A criminal conviction must be predicated on proof beyond reasonable doubt; findings based solely on conjectures, where banking procedures appear to have been followed and material witnesses remain unexamined by the prosecution, are legally unsustainable.

Headnote:(A) Penal Code - Sections 120B, 420, 465 and 471 - Prevention of Corruption Act - Section 5(1)(d) read with Section 5(2) - Allegation of criminal conspiracy to defraud bank - Conviction of borrower - Legality of findings - Court must base conviction on concrete evidence rather than conjectures and surmises - Prosecution failed to produce material witnesses or prove fraudulent intent behind loan sanctioning. (Paras 10, 26, 27, 28)

(B) Evidence - Burden of proof - Prosecution failed to establish guilt beyond reasonable doubt - When banking procedures are shown to be followed and loan amounts are within discretionary limits of officials, mere allegation of conspiracy without corroborating testimony of relevant bank employees renders the prosecution case infirm. (Paras 14, 17, 26)

Facts of the case:
The appellant challenged an order of conviction related to an alleged criminal conspiracy to secure bank loans through fictitious entities. The prosecution claimed that the bank official and the borrower conspired to sanction loans in an irregular manner, violating bank norms. The trial court convicted the appellant based on the alleged irregularity of the loan approval process. The appellant contended that the loan was sanctioned within the bank's discretionary guidelines and that no fraud was committed.

Findings of Court:
The court found that the prosecution failed to substantiate the charges. Testimony from banking officials confirmed that the loan sanctioning process followed established procedures and that the amount was within the discretionary power of the approving authority. Furthermore, the failure of the prosecution to examine key witnesses who could verify the authenticity of documents and signatures created a significant gap in evidence.

Issues: The main issues were whether the appellant and the bank official engaged in a criminal conspiracy to fraudulently obtain a loan and whether the prosecution successfully discharged its burden of proving dishonest intent and procedural illegality beyond reasonable doubt.

Ratio Decidendi: Conviction cannot be sustained upon mere conjectures. When documentary evidence suggests adherence to banking norms and the prosecution withholds material witnesses capable of clarifying the transparency of the transaction, the standard of proof beyond reasonable doubt is not met. The finding of guilt must be based on objective evidence of dishonesty, which was absent in this case.

Result: Appeal allowed. Conviction set aside.

Prasenjit Biswas, J:-

1. The instant appeal is preferred by the appellant challenging the impugned judgement and order of conviction dated 27.11.2003 passed by the learned Judge, 4th Special Court, Calcutta in connection with Special Case No. 2 of 1988.

2. By passing the impugned judgment this appellant is found guilty for commission of offence punishable under Section 120B /420/465/471 of the Indian Penal Code along with fine and sentenced him to suffer imprisonment accordingly.

3. Being aggrieved and dissatisfied with the said impugned judgement and order of conviction passed by the Trial Court the present appeal is filed at the behest of the appellant –convict.

4. In short campus story of the prosecution is delineated hereunder:-

“Shri K.C. Balasubrananium, the Branch Manager of Central Bank of India, New Market Branch, Calcutta had entered into a criminal conspiracy with Parimal Roy (the present appellant) of village Udayarampur, P.O. Bishnupur, District- 24 Parganas (South) and out of the said conspiracy the Branch Manager of the Bank had sanctioned cash credit limit of Rs. 2,75,000/- and term loan of Rs. 1,00,000/- in favour of the firm of Parimal Roy under the name and style as M/s. Packing India, 35, C.R. Avenue, Calcutta- 700 006 alleged to be a fictitious one. The amount of the above two loans were released in favour of the accused Parimal Roy in an irregular manner without adhering the rules of the bank and allowed the accused Parimal Roy to withdraw the said amount to the tune of Rs. 3,75,000/-.”

5. Shri D.N. Biswas, Inspector of Police, C.B.I. lodged the FIR suo moto and the case was registered being Crime No. 68 of 1986 dated 23.09.1986 for the offence under Section 120B /420 of the Indian Penal Code and Section 5(2) read with Section 5(1)(d) of the Prevention of Corruption Act, 1947 .

6. Thus, the criminal law was set in motion. The CBI Inspector took up the case for investigation and in course of investigation he examined witnesses, arrested the accused persons and seized some other documents under the seizure list and thereafter, he has been transferred from Calcutta to Delhi then one Pradip Christopher, Inspector CBI/S.P.E./A.C.B./Calcutta took up the investigation and after conclusion of investigation submitted charge-sheet against this appellant along with other accused persons under Section 120B /420/467/468/471 of the Indian Penal Code and Section 5(2) read with Section (1)(d) of the Prevention of Corruption Act, 1947 .

7. Charge was framed against this appellant and other two accused persons under Section 120B /420 read with Section 34/465/471 of the Indian Penal Code and Section 5(1)(d) read with Section 5(2) of the Prevention of Corruption Act, 1947 .

8. In this case, prosecution has examined 21 witnesses in order to bring home the charge levelled against the accused persons.

9. Ms. Monami Mukherjee, learned Amicus Curiae said that the prosecution has hopelessly failed to prove the case against this appellant beyond all reasonable shadow of doubt. The learned Advocate further contended that the entire investigation was done in a perfunctory manner and virtually there is no evidence at all from any of PWs to the effect that this appellant acted dishonestly in furtherance of the conspiracy to cheat the bank by any illegal act. The Bank Manager, K.C. Balasubrananium (one of the accused persons) after duly following banking procedure and rules granted loans in favour of the M/s. Packing India. It is further said by the learned Advocate that PW2 being the Deputy Chief Officer of Central Bank of India, New Market Branch never stated that there was any irregularities in the opening of the account in the name of M/s. Packing India. It is said by the learned Advocate that the prosecution has failed to produce any cogent evidence by which it can be said that the appellant has committed the offence for which he was found guilty.

10. Ms. Mukherjee further assailed that the learned Trial Court failed to ass

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