Crl.Appeal No.17-SB of 1995 1 IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH. Date of decision: 9 .9.2010 (I) Crl.Appeal No.17-SB of 1995 Subhash ... Appellant versus State of Punjab ... Respondent (II) Crl.Appeal No.19-SB of 1995 Naveen Kumar and another ... Appellants versus State of Punjab ... Respondent CORAM: HON'BLE MR. JUSTICE JORA SINGH. Present: Mr.G.S.Bhatia, Advocate, for the appellant in Crl.Appeal No.17-SB of 1995 Mr.G.S.Sawhney, Advocate, for the appellants in CrlAppeal No.19-SB of 1995. Mr.Ajay Kaushik, Advocate, for CBI. ... JORA SINGH, J. Crl.Appeal No.17-SB of 1995 was preferred by Subhash Chander and Crl.Appeal No.19-SB of 1995 was preferred by Naveen Kumar and Smt.Nirmala Jain to impugn the judgment of conviction and order of sentence dated 2.12.1994 rendered by Special Judge, CBI, Punjab, Patiala, arising out of FIR No. RC 18 dated 21.8.1989 under Sections 120-B/ 420 IPC and Sections 5(1) (d) (2)/13(1)( d)(2) of P.C.Act, SPE, Chandigarh. By the said judgment, they were convicted under Sections 120- B/420 IPC and Sections 5(2)/13(2) of P.C. Act and sentenced to undergo Crl.Appeal No.17-SB of 1995 2 imprisonment as under: Naveen Kumar U/S 120-B IPC To undergo RI for two years and to pay a fine of Rs.500/-, in default of payment of fine, to further undergo RI for two months. U/S 420-B IPC To undergo RI for two years and to pay a fine of Rs.300/-, in default of payment of fine, to further undergo RI for two months. U/S 5(2) of P.C.Act To undergo RI for three years and to pay a fine of Rs.1,000/-, in default of payment of fine, to further undergo RI for four months. Subhash Chander U/S 120-B IPC To undergo RI for two years and to pay a fine of Rs.500/-, in default of payment of fine, to further undergo RI for two months. U/S 420-B IPC To undergo RI for two years and to pay a fine of Rs.300/-, in default of payment of fine, to further undergo RI for two months. Nirmala Jain U/S 120-B IPC To undergo RI for two years and to pay a fine of Rs.500/-, in default of payment of fine, to further undergo RI for two months. U/S 420-B IPC To undergo RI for two years and to pay a fine of Rs.300/-, in default of payment of fine, to further undergo RI for two months. During the pendency of appeal, Kulbhushan Uppal died on 23.4.2008. Death certificate was produced and the same was ordered to be Crl.Appeal No.17-SB of 1995 3 taken on record. With the death of Kulbhushan Uppal, appeal No.10-SB of 1995 qua him stands abated vide order dated 17.11.2008. Prosecution story, in brief, is that Kulbhushan Uppal was serving as Accountant in State Bank of India, Fontonganj Branch, Jalandhar City, during 1987 to 1989. Naveen Kumar was serving as Clerk in State Bank of India, New Railway Road Branch, Jalandhar City. Nirmala Jain and Subhash Chander had their accounts in the State Bank of India, Fontonganj Branch, Jalandhar City. Kulbhushan Uppal dishonestly secured blank cheque No.286165 from State Bank of India, Fontonganj Branch, Jalandhar City. Entries were made by Kulbhushan Uppal regarding payment to self an amount of Rs.82,000/-. Cheque was alleged to have been issued by Nirmala Jain, Proprietor of M/s Paradise Marketing. Cheque was passed by Kulbhushan Uppal but he did not make any debit entry in the ledger sheet of M/s Paradise Marketing Account No.8/40009. Only Rs.6000/- was a balance in the credit side of the party. Payment was arranged to N.K.Jain through A.K.Passi, Cashier of the bank. Kulbhushan Uppal in collusion with N.K.Jain got the said amount of Rs.82,000/- transferred to the accounts of two parties, namely, M/s Abhisheikh Enterprises and Raju Karyana Store. Above said firms had debit balance before the transfer of amount of Rs.40,000/- and Rs.42,000/-, respectively, in their accounts. Another cheque worth Rs.27,000/- dated 7.3.1988 was passed by Kulbhushan Uppal. Entry was made at page 34 of the bank cash scroll in the name of fictitious person Charanjit, Account No. 10042. Entry was also made at page 101 of payment register showing Account No.10042 but no such account was existing in the relevant ledger No.8. Rs.27,000/- was transferred to three firms, namely, M/s A.N. Steel Mfg. Co., M/s Abhisheikh Enterprises and Crl.Appeal No.17-SB of 1995 4 M/s Neetu Electrical. In M/s A.N. Steel Mfg. Co., wife of N.K.Jain was the partner. Account opening forms of all the three firms were found to have been filled by N.K.Jain. Accused Kulbhushan Uppal dishonestly accepted cheque No.549698 for Rs.50,000/-, cheque No.549672 for Rs.10,000/-, cheque No.560167 for Rs.30,000/-, cheque No.549685 for Rs.21,453.50, cheque No.560141 for Rs.3,000/-, cheque No.560189 for Rs.25,000/-, cheque No.560168 for Rs.7,000/-, cheque No.560143 for Rs.35,000/-, cheque No.560190 for Rs.30,000/-, cheque No.040049 for Rs.18,000/-, cheque No.048059 for Rs.30,000/-, cheque No.286184 for Rs.2,000/-, cheque No.286186 for Rs.2008/- and cheque No.040069 for Rs.1,000/-. Above said cheques were passed by Kulbhushan Uppal but no entry was made in the ledger sheet of the respective parties. Cheque No.549698 was filled by Kulbhushan Uppal signed by Smt. Nirmala Jain, Cheque No.549672 was also signed by N.K.Jain, whereas Cheque Nos.560141, 560167, 560168 and 560163 were filled and signed by Subhash Chander and received the payment of said cheques. Kulbhushan Uppal and Naveen Kumar, bank employees, with the connivance of Nirmala Jain and Subhash Chander, cheated and defrauded the bank to the tune of Rs.3,73,481.50 ps. After completion of investigation, challan was presented in Court. Accused were charged under Sections 120-B/420 IPC and Sections 5(1)(d)(2)/13(1)(d)(2) of P.C.Act, to which they pleaded not guilty and claimed trial. In order to substantiate its case, prosecution examined 26 witnesses. PW5 S.K.Bhandari, Assistant Manager, stated that N.K.Jain Crl.Appeal No.17-SB of 1995 5 was serving as Clerk in the State Bank of India. Cheques (Ex.PW5/1 to Ex.PW5/4) were filled in the hands of N.K.Jain. Account opening forms (Ex.PW5/5) of Paradise Marketing, Ex.PW5/6 of Paradise Marketing, PW5/7 and Ex.PW5/8 of A.N. Steel Mfg. Co., PW5/9 of Abhisheikh Enterprises and Ex.PW5/10 of Neetu Electrical, were filled in the hands of N.K.Jain. PW6 B.R.Chabra, Deputy Manager, stated that N.K.Jain was serving as Clerk in the Bank. Account opening form (Ex.PW5/9) was in the hand of N.K.Jain. Account opening forms (Ex.PW5/5 and Ex.PW10/5) were also in the hand of N.K.Jain. He identified the signatures of N.K.Jain. PW12 Ram Paul stated that N.K.Jain was known to him. He had account in the State Bank of India, Railway Road, Jalandhar. Abhishekh Kumar and Sanjeev Kumar were not known to him but on their account opening forms (Ex.PW5/9 and Ex.PW5/10) his signatures were obtained by N.K.Jain. PW14 Rakesh Kumar stated that Nirmala Kumari was not known to him. Ashwani Kumar had a firm in the name of A.N. Steel. He got his signatures on the partnership deed, copy of which is Ex.PW14/A. In fact, no firm in the name of A.N. Steel or M/s Abhisheikh ever worked in House No.ER-193, Pucca Bagh, Jalandhar. PW15 Raj Kumari stated that she was serving as Clerk in State Bank of India Branch Mandi, Fontonganj. All the cheques received are required to be entered in the ledger of the party. Then cheques are sent to the passing officer. Cheque No.886165 dated 5.3.1988 is worth Rs.82,000/-, but no entry in the ledger sheet of M/s Paradise Marketing. Above said cheque was not received by her. Crl.Appeal No.17-SB of 1995 6 PW16 Sanjeev Kumar stated that N.K.Jain, Clerk, State Bank of India, was known to him. His brother Ashwani Kumar was dealing in manufacturing of buckets. N.K.Jain used to visit his shop to contact his brother Ashwani Kumar. N.K.Jain had requested him to sign certain papers for opening the account. N.K.Jain had taken him to the premises of State Bank of India. Kulbhushan Uppal was present in the bank and he gave him one form. His signatures were obtained on the form. Ex.PW5/10 is the account opening form of M/s Neetu Electrical. He had signed the account opening form on the request of N.K.Jain, when Kulbhushan Uppal was also present there. On the asking of N.K.Jain, he had signed one or two cheques and at that time, Kulbhushan Uppal was also present. PW17 Sudershan Kumar Mahajan stated that he was carrying on business in the name and style of M/s Sham Cycle Store on Railway Road, Jalandhar. He had account in the State Bank of India. N.K.Jain was Clerk in the bank. Account opening forms (Ex.PW5/5 and Ex.PW5/7) bear his signatures as introducer. He had signed the account opening forms on the request of N.K.Jain. N.K.Jain had requested him to sign the same by saying that accounts are related to his friends. M/s A.N. Steel Mfg. Co. and M/s Paradise Marketing were not known to him. PW20 R.M.Dhir, Deputy Head Cashier, State Bank of India Branh, Fontonganj, stated that as per payment register, payment of Rs.27,000/- was made to Charanjit. Entry is in his hand. Copy of the same is Ex.PW20/1. Rs.17,000/- was credited to Account No.8/192, Rs.8,000/- to the Account of Neetu and Rs.2,000/- to the Account of Abhisheikh Enterprises. Ex.PW20/2 is the copy of scroll authenticated by Kulbhushan Uppal. Rs.10,000/- was paid on 18.8.1987 to Ashwani Kumar. Ex.PW20/3 Crl.Appeal No.17-SB of 1995 7 is the copy of entry. Payment of Rs.50,000/- was on 7.11.1987 to Ram Lal. Ex.PW20/4 is the copy of entry. Cheque (Ex.PW19/42) is in the hand of Kulbhushan Uppal and as per endorsement on the cheque, payment was made to Inder Raj. Payment of Rs.3,000/- was made to Subhash Chander on 18.8.1987. Copy of entry is Ex.PW20/5. Payment of Rs.3,000/- was made to Subhash Chander on 28.3.1988. Copy of entry is Ex.PW20/6. Again there was a payment of Rs.35,000/- on 30.4.1988 to Subhash Chander. Ex.PW20/7 is the copy of entry. Payment of Cheques (Ex.PW19/32, Ex.PW19/34 and Ex.PW19/43) was made to Subhash Chander. As per entry at page 189 and 193, payment of Rs.2,000/- was made to Kulbhushan Uppal. As per entry (Ex.PW20/9), payment of Rs.2,000/- was made to Kulbhushan Uppal. Payment of Rs.10,000/-, Rs.15,000/- and Rs.15,000/- was made to N.K.Jain as per entry at Nos.3, 4 and 5. As per cheque (Ex.PW5/3), Rs.15,000/- was paid to N.K.Jain on 2.6.1987, as per payment register. Payment of Rs.50,000/- each was made to N.K. Jain as per entry at Sr.No.8 and 9. Cheques (Ex.PW19/43 and Ex.PW19/44) were filled by Kulbhushan Uppal and payment of these cheques was made to N.K.Jain. Credit vouchers, copies of which are Ex.PW20/13 and Ex.PW20/14, were filled by him on the instructions of Kulbhushan Uppal. Vouchers were also passed by Kulbhushan Uppal. As per vouchers, payment of Rs.27,000/- was made to Charanjit. Statements of remaining witnesses are of formal nature. After close of the prosecution evidence, statements of the appellants were recorded under Section 313 Cr.P.C. They denied all the prosecution allegations and pleaded to be innocent. After hearing learned Public Prosecutor for the State, learned Crl.Appeal No.17-SB of 1995 8 defence counsel for the appellants and from the perusal of evidence on the file, appellants were convicted and sentenced as stated aforesaid. I have heard learned defence counsel for the appellants, learned State counsel and have gone through the evidence on the file. Learned defence counsel for the appellants argued that Kulbhushan Uppal (deceased) was the Accountant whereas Naveen Kumar was the Clerk in the State Bank of India at the relevant time. Smt. Nirmala Jain and Subhash Chander had their accounts in the bank but none of the appellants had withdrawn any amount from the bank. Case of the prosecution was that some one forged the signatures of Nirmala Jain. All the cheques were passed by Kulbhushan Uppal (deceased). In case, no payment in the account of Nirmala Jain and Subhash Chander, then there was no idea to clear the cheques. Main accused was Kulkbhushan Uppal, who had died on 23.4.2008. Argued that Nirmala Jain and Subhash Chander were convicted under Sections 120-B/420 IPC. Occurrence is of the year 1987-89. At that time, Nirmala Jain was 39 years' old, whereas Subhash Chander was 38 years' old. Subhash Chander has already undergone 7 days. If the Court is of the opinion that they are also liable, then lenient view may be taken by releasing them on probation. Reliance was placed on 2007(3) RCR (Crl.) 735, S.P.Malhotra vs. UT, Chandigarh. Learned counsel for appellant Naveen Kumar argued that Naveen Kumar was simply a Clerk in the bank. No payment by Naveen Kumar. All the cheques were cleared by Kulbhushan Uppal. Naveen Kumar was implicated simply on the allegation that some of the account opening forms were filled by him. Crl.Appeal No.17-SB of 1995 9 Learned State counsel argued that Kulbhushan Uppal was the Accountant, whereas Naveen Kumar was serving as Clerk. Different cheques were passed by Kulbhushan Uppal. Payment was transferred in favour of M/s Abhisheikh Enterprises, Raju Karyana Store and A.N. Steel Mfg. Co. In fact, no such firm was in existence. With the connivance of bank officials, fictitious accounts were opened. Bank was defrauded to the tune of Rs.3,73,481.50 ps. Evidence on the file was rightly scrutinized by the trial Court. Allegation of the appellants was that accounts were rightly got opened. Cheques were issued and if there was no payment in the accounts, then cheques should have been returned to the concerned account holder, whereas allegation of the bank was that some of the cheques were arranged by Kulbhushan Uppal and after clearance, payment was transferred in favour of different firms. Different accounts were opened in the name of fictitious firms. In fact, no firm in the name of A.N. Steel Mfg. Co., Abhisheikh Enterprises or Neetu Electrical was in existence. PW5 S.K.Bhandari was serving as Assistant Manager in the State Bank of India, Railway Road Branch, Jalandhar. N.K.Jain was serving as Clerk in the said branch.Cheques (Ex.PW5/1 to Ex.PW5/4) were filled by N.K.Jain. Account opening forms (Ex.PW5/5 to Ex.PW5/10) were filled by N.K.Jain. Accounts were opened in the name of M/s Paradise Marketing, M/s A.N. Steel Mfg. Co., M/s Abhisheikh Enterprises and Neetu Electrical. PW6 B.R.Chabra, Deputy Manager, also stated on oath that account opening forms (Ex.PW5/5, Ex.PW5/7, Ex.PW5/9 and Ex.PW5/10) were filled by N.K.Jain. No expert was examined by the appellants that signatures on the above said account opening forms were not of N.K.Jain. Crl.Appeal No.17-SB of 1995 10 Account Books of above said forms were not produced to show that actually firms were carrying on business. Copies of forms A and C could easily be produced to show as to when the firms were opened and who were the partners. In the absence of account books and forms A and C, appellants cannot argue that in fact, M/s Paradise Marketing, A.N. Steel Mfg. Co., M/s Abhisheikh Enterprises and Neetu Electrical were in existence and carrying on business. PW14 Rakesh Kumar was the employee of Krishna Engg. Works. Ashwani Kumar was known to him. Ashwani Kumar had formed a firm in the name of A.N. Steel. Ex.PW14/A is the copy of partnership deed bearing the signatures of Rakesh Kumar but as per this witness, no firm in the name of A.N. Steel ever worked in his House No. ER-193, Pucca Bagh, Jalandhar. According to the partnership deed, Smt. Nirmala Jain w/o N.K. Jain was the partner. According to account opening form (Ex.PW5/9), M/s Abhisheikh Enterprises was also carrying on its business at House No. ER- 193, Pucca Bagh, Jalandhar, but as per PW14 Rakesh Kumar, no firm in the name and style of M/s Abhisheikh Enterprises ever worked in House No. ER-193, Pucca Bagh, Jalandhar. That means, A.N. Steel and Abhisheikh Enterprises are bogus firms. Account opening forms (Ex.PW5/5 and Ex.PW5/7) were signed by Sudhershan Kumar as introducers but his signatures were obtained by N.K.Jain. That means, from the very beginning, N.K.Jain had the intention to defraud the bank. PW12 Ram Paul stated that N.K.Jain was known to him because he had account in State Bank of India, Railway Road Branch, Jalandhar. Abhishekh Kumar and Sanjeev Kumar were not known to him Crl.Appeal No.17-SB of 1995 11 and on the request of N.K.Jain, his signatures were obtained on the account opening forms (Ex.PW5/9 and Ex.PW5/10). PW20 R.M.Dhir stated that as per entry No.3, 4 and 5, payment of Rs.10,000/-, Rs.15,000/- and Rs.15,000/- were made to N.K.Jain. Rs.15,000/- was paid to N.K.Jain as per cheque (Ex.PW5/3). Payment of Rs.50,000/- was paid as per entry at Sr. Nos. 8 and 9, as per cheque (Ex.PW20/11) to N.K.Jain. Payment of cheques (Ex.PW19/43 and Ex.PW19/44) was also made to N.K.Jain. Payment of Rs.82,000/- as per entry (Ex.PW22/6) dated 5.3.1988 was in the hand of Kulbhushan Uppal as per vouchers (Ex.PW3/1 and Ex.PW3/2). Vouchers were handed over to R.M.Dhir (PW20) by N.K.Jain. Payment of Rs.82,000/- was credited to the accounts of M/s Abhisheikh Enterprises and Raju Karyana Store. When cheques are received, then entries are made in the ledger of the parties. After that, cheques are sent to the passing officer but in the present case, no entry in the ledger of the parties. Cheques were passed by Kulbhushan Uppal. Account opening form (Ex.PW5/10) of M/s Neetu Electrical bears the signatures of PW16 Sanjeev Kumar but as per Sanjeev Kumar, his signatures were obtained on the account opening form by N.K.Jain and Kulbhushan Uppal. As per Sanjeev Kumar, Neetu Electrical was a bogus firm of accused N.K.Jain. Evidence shows that earlier Ashwani Kumar was proprietor of M/s A.N. Steel Mfg. Co. Nirmala Jain was the sleeping partner but the firm was dissolved in the year 1988. N.K. Jain, husband of Nirmala Jain, was having two firms in the name and style of Neetu Electrical and Abhisheikh Enterprises. Abhishekh is the son of N.K.Jain. Cheque dated 7.3.1988 Crl.Appeal No.17-SB of 1995 12 worth Rs.27,000/- was transferred in favour of M/s A.N.Steel Mfg. Co., M/s Abhisheikh Enterprises and M/s Neetu Electrical. That means, bogus accounts were being operated by giving fictitious credit. So, N.K. Jain cannot argue that he was not the party to the conspiracy. According to payment register, Rs.3,000/- was paid to Subhash Chander on 18.8.1987. Ex.PW20/5 is the copy of the entry. Rs.3,000/- was paid on 28.3.1988 to Subhash Chander and this fact is clear from the copy of entry (Ex.PW20/6). Rs.35,000/-was paid on 20.4.1988 as per entry (Ex.PW20/7). Payment of cheque (Ex.PW19/32) was also made to Subhash Chander. So, payment of three cheques (Ex.PW19/32, Ex.PW19/34 and Ex.PW19/43) was made to Subhash Chander. Specimen signatures of Subhash Chander were compared with the disputed signatures on the cheques (Ex.PW19/32, Ex.PW19/34 and Ex.PW19/43). As per opinion of the expert, disputed signatures on the above said cheques were tallying with the specimen signatures of Subhash Chander. So, above said cheques were issued by Subhash Chander and he had received payment of the cheques as proprietor of Anand Sales Corporation. Cheques (Ex.PW19/32, Ex.PW19/33, Ex.PW19/34, Ex.PW19/35 and Ex.PW19/37) were passed by Kulbhushan Uppal, entries were made in the cash scroll but no entry was made in the ledger of Anand Sales Corporation regarding debit of the amount. Payment was made to Subhash Chander. All this shows that illegal benefits were obtained by Subhash Chander with the connivance of Kulbhushan Uppal. Partnership Deed (Ex.PW10/1) was signed by PW10 Mandip Nanda and accused Nirmala Jain. Partnership deed was dissolved on 31.3.1988 as per dissolution deed (Ex.PW10/2). Ex.PW5/5 is the account Crl.Appeal No.17-SB of 1995 13 opening form of M/s Paradise Marketing but PW14 Rakesh Kumar stated that Ashwani Kumar had formed a firm in the name and style of A.N. Steel. Kulbhushan Uppal accepted cheques directly and passed the same in the capacity of passing officer without making entry regarding debit of that amount in the account of M/s Paradise Marketing. Three cheques (Ex.PW5/1, Ex.PW5/2 and Ex.PW19/42) were issued by Nirmala Jain. Disputed signatures of Nirmala Jain on the cheques were found to be tallying with her specimen signatures. All this shows that different cheques were issued by the appellants and the cheques were passed by Kulbhushan Uppal. Payment was also collected by the appellants. Accounts were opened in the name of fictitious firms. Appellants cannot argue that in case there was no payment in the accounts of Subhash Chander and Nirmala Jain, then there was no idea to clear the cheques. Cheques should have been returned. But when the accounts were opened in the name of fictitious firms, then there was no idea to issue cheques. Cheques were issued with the connivance of Kulbhushan Uppal and Naveen Kumar and payment was collected. Evidence was rightly scrutinized by the trial Court. No reason to differ. Learned counsel for the appellants argued that bank was defauded in the years 1987-1989. At that time, Kulbhushan (deceased) was 46 years' old, Naveen Kumar and Nirmala Jain were 39 years' old, whereas Subhash Chander was 38 years' old. They have not committed any such act after the conviction. Naveen Kumar has lost his job. Nirmala Jain and Subhash Chander are private persons. They were convicted under Sections 120-B/420 IPC. Requested to release Nirmala Jain and Subhash Chander on probation. Crl.Appeal No.17-SB of 1995 14 Reliance was placed on 2007(3) RCR (Crl.) 735, S.P.Malhotra vs. UT, Chandigarh. Case was under the Corruption Act and under Section 420 IPC. Appellant was convicted under Section 420 IPC and was ordered to be released on probation. In the present case also, Nirmala Jain and Subhash Chander were convicted under Sections 120-B/420 IPC. Subhash Chander has already undergone 7 days. They are to become hard criminal if again sent to jail. Nirmala Jain and Subhash Chander are ordered to be released on probation on furnishing probation bonds in the sum of Rs.10,000/- with one surety of like amount to keep peace and be of good behaviour for a period of one year and to receive sentence when called upon in case of breach of the conditions of the bond. Nirmala Jain and Subhash Chander are further directed to deposit Rs.50,000/- each as costs of litigation within three months before the trial Court. Naveen Kumar appellant was the employee of bank and was convicted under Section 5(2) of Prevention of Corruption Act. So, he cannot be released on probation. In the light of above discussion, appeal without merit is dismissed with modification on the point of sentence. 9 .9.2010 ( JORA SINGH ) pk JUDGE