The absence of prima facie evidence of knowledge or criminal intent against accused suffices to quash charges in embezzlement cases.

By the present Petition under Article 227 of the Constitution of India read with Section 4 82 of the Code of Criminal Procedure, 1973 (for short, “the Cr.P.C .”), the Petitioners, Original accused Nos.9, 10 and 11, have impugned Order dated 15th March, 2017, issuing process against them in the alleged offence under Sections 3 4, 109, 120B, 201, 406, 409, 411, 420, 465, 467, 468, 471 and 477A of the Indian Penal Code (for short, “the IPC”) and under Sections 3 and 4 of the Prohibition of Benami Property Transactions Act , 1988 (for short, “Benami Act”) bearing C.R. No.336 of 2015 dated 18th July, 2015, originally registered with Dashisar Police Station and subsequently investigated by the State CID, Konkan Bhavan, Navi Mumbai and Order dated 24th January, 2020, thereby rejecting the Application filed by the Petitioners under Section 227 of the Cr.P.C . for their discharge from the said offences.

2 Heard Mr. Ponda, learned Senior Advocate for the Petitioners, Mr. Chavan, learned Special P.P. for the Respondent State. Perused entire record annexed to the Petition.

3 The prosecution case in brief is that-

(i) The accused No.5-Shri. Ramesh N. Kadam (A-5), when was the Chairman of Sahityaratna Lokshahir Annabhau Sathe Development Corporation (for short, “SLASDC”) during the period from 13th August, 2012 to 12th December, 2014, committed embezzlement and/or defalcation of approximately Rs.312 crores of Government funds and through his various institutions/entities, diverted those funds for purchase of properties. There are in all 27 accused persons in present crime.

(ii) As far as the Petitioners are concerned, the first charge- sheet was filed against them on 18th February, 2017, bearing Court Case No.12 of 2017. A supplementary charge-sheet has been filed against the Petitioners on 13th January, 2020.

(iii) As per the first charge-sheet dated 18th February, 2017, it is the allegation against the Petitioners that, during the period from 2009 to 2015, the Petitioners connived, conspired with the main accused and the then Chairman and public servant of SLASDC in misappropriating funds of SLASDC to the tune of Rs.111 crores, which were earmarked to be used for the upliftment of Matang Community and dishonestly diverted the said amount from Mr. Ramesh Kadam (A-5) controlled institutions like Joshaba Madhyavarti Grahak Sahakari Sanstha Maryadit, Mumbai (for short, “Joshaba”), Lokshahir Annabhau Sathe Backward Class Co-operative Spinning Mill Limited, Paithan, Aurangabad (for short, Spinning Mill Ltd.) and Mahalakshmi Dudhautpadak Co-operative Society (for short, Dudhautpadak Society) by effecting false, fabricated, fictitious and fraudulent entries in Comral Realty Private Limited (for short, Comral Ltd.) and Hubtown Limited (for short, “Hubtown Ltd.”) books of account and showed them as true while submitting accounts to the Registrar of Companies and diverted the said amount along with the amount diverted from the Metri Sugar and Trading Private Limited (for short, ‘Metri Ltd.’) (which was allegedly the amount misappropriated from SLASDC) into the account of Comral Ltd. and Hubtown Ltd. respectively and misappropriated an amount of Rs.111 crores and knowingly retained the misappropriated amount with them and also cheated other share-holders of Comral Ltd. and Hubtown Ltd. for their wrongful gain and wrongful loss to SLASDC and thereby the Petitioners committed an offence under various Sections of the said Acts.

(iv) As per the supplementary charge-sheet dated 13th January 2020, it is the allegation against the Petitioners that, the Petitioner No.1 is the Managing Director of Hubtown Ltd. (formerly known as “Akruti City Limited”, [for short, “Akruti Ltd.”]) and he along with his relatives have 67% shares in the said Company. Petitioner No.1 also had rights of financial transactions of the said Company. Petitioner No.1 also had 50% of shares in Comral Ltd. (formerly known as “Kamla Shanti Realty Private Limited, [for short, Kamla Shanti Ltd.]).