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JUDGMENT

REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.517 OF 2014

(Arising out of Special Leave Petition (Crl) No. 6138 OF 2006)

CBI, ACB, MUMBAI

.

... APPELLANT (S)

VERSUS

NARENDRA LAL JAIN & ORS.

... RESPONDENT (S)

J U D G M E N T

RANJAN GOGOI, J.

1.

Leave granted.

2.

The appellant, Central Bureau of Investigation (CBI)

ACB, Mumbai seeks to challenge an order dated 28.10.2005

passed by the High Court of Bombay quashing the criminal

proceedings against the respondents Narendra Lal Jain,

Jayantilal L. Shah and Ramanlal Lalchand Jain. The aforesaid

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respondents had moved the High Court under Section 482

Code of Criminal Procedure, 1973 (for short “Cr.P.C.”)

challenging the orders passed by the learned Trial Court

refusing to discharge them and also questioning the

continuance of the criminal proceedings registered against

them. Of the three accused, Jayantilal L. Shah, the court is

informed, has died during the pendency of the present

appeal truncating the scope thereof to an adjudication of the

correctness of the decision of the High Court in so far as

accused Narendra Lal Jain and Ramanlal Lalchand Jain are

concerned.

3.

On the basis of two FIRs dated 22.03.1993, R.C. No.

21(A) of 1993 and R.C. No.22 (A) of 1993 were registered

against the accused-respondents and several officers of the

Bank of Maharashtra. The offences alleged were duly

investigated and separate chargesheets in the two cases

were filed on the basis whereof Special Case No. 15 of 1995

and Special Case No. 20 of 1995 were registered in the Court

of the Special Judge, Mumbai. In the chargesheet filed,

offences under Sections 120-B/420 IPC and Sections 5(2)

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read with Section 5(1)(d) of the Prevention of Corruption Act,

1947 corresponding to Sections 13(2) read with Section

13(1)(d) of the Prevention of Corruption Act, 1988 (for short

“PC Act”) were alleged against the accused persons. In so

far as the present accused-respondents are concerned the

gravamen of the charge is that they had conspired with the

bank officials and had projected inflated figures of the

creditworthiness of the companies represented by them and

in this manner had secured more advances/loans from the

bank than they were entitled to.

4.

While the criminal cases were being investigated the

bank had instituted suits for recovery of the amounts

claimed to be due from the respondents. The said suits were

disposed of in terms of consent decrees dated 23.04.2001.

Illustratively, the relevant clause of the agreement on the

basis of which the consent decrees were passed reads as

follows:

“10. Agreed and declared that dispute

between the parties hereto were purely and

simply of civil nature and on payment

mentioned as aforesaid made by the

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Respondents the Appellants have no

grievance of whatsoever nature including of

the CBI Complaint against the Respondents.”

5.

Applications for discharge were filed by the accused-

respondents which were rejected by the learned Trial Court

by order dated 04.09.2011. The learned Trial Court,

thereafter, proceeded to frame charges against the accused.

In so far as the present accused-respondents are concerned

charges were framed under Sections 120-B/420 of the Indian

Penal Code whereas against the bank officials, charges were

framed under the different provisions of the Prevention of

Corruption Act, 1988 (PC Act). The challenge of the

respondents to the order of the learned Trial Court refusing

discharge and the continuation of the criminal proceedings

as a whole having been upheld by the High Court and the

proceedings in question having been set aside and quashed

in respect of the respondent, the CBI has filed the present

appeal challenging th