IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.GIRI FRIDAY, THE 13TH FEBRUARY 2009 / 24TH MAGHA 1930 CRL.A.No. 900 of 1999(C) ------------------------ {C.C.NO.28/1998 OF THE SPL.COURT SPE/CBI-II, ERNAKULAM} .................... APPELLANT(S)/ACCUSED: ----------------------------- P.I.BABU, FORMER BRANCH MANAGER, SYNDICATE BANK, THODUPUZHA BRANCH, THODUPUZHA, RESIDENT OF PUTHENPEEDIKAYIL, KOOTHATTUKULAM, ERNAKULAM DISTRICT. BY ADV. SRI.P.VIJAYA BHANU RESPONDENT(S)/COMPLAINANT: ------------------------------------- SRI.P.BALACHANDRAN, INSPECTOR OF POLICE, SPE/CBI, KOCHI-17. BY SRI.MVS.NAMBOOTHIRY SC FOR CBI THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 13/02/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: V.GIRI, J. ------------------------- Crl.A.No.900 of 1999 ------------------------- Dated this the 13th day of February, 2009. JUDGMENT The accused in C.C.No.28/98 on the file of the Court of the Special Judge, SPE/CBI, Ernakulam, is the appellant in this Criminal Appeal. 2. The accused was prosecuted, convicted and sentenced for offences under Sections 409, 465, 467 and 471 of the Indian Penal Code (for short 'the Code”} and Section 13(2) of the Prevention of Corruption Act, 1988 {for short “the Act”}. He was sentenced to rigorous imprisonment for a period of 3 years and to pay a fine of Rs.5,000/- for the offence under Section 409, rigorous imprisonment for one year and to pay a fine of Rs.5,000/- for the offence under Section 465 and rigorous imprisonment for one year and to pay a fine of Rs.5,000/- under Section 471 and rigorous imprisonment for 3 years and to pay a fine of Rs.5,000/- for the offence under Section 13(2) of the Act. Crl.A.No.900 of 1999 :: 2 :: 3. The case of the prosecution is that the accused was the Branch Manager of Syndicate Bank, Thodupuzha Branch during 1993-94. He was having discretionary powers to sanction loans upto Rs.25,000/- to Artisans and Village Industries under the Composite Loans Scheme. That on 8.12.1993, he had dishonestly and by illegal means sanctioned a loan of Rs.25,000/- as O.S.L.No.36/93 in the name of a 'fictitious person' in the address “P.V.Johny, Parappurath Puthenpurayil, Muthalakkodm, Thodupuzha” That, he had, in this connection, forged documents and concocted loan documents. That, he had thereafter withdrawn an amount of Rs.24,000/- out of the said loan account as per withdrawal slip dated 9.12.1993 and drew a sum of Rs.500/- after the loan amount was credited in the savings bank account, which was newly opened in the name of PV.Johny, bearing Account No.14628 on 6.12.1993. He had, therefore, committed misappropriation. He had committed forgery of the loan documents and in the Crl.A.No.900 of 1999 :: 3 :: documents relating to the opening of a Savings Bank Account in the name of a fictitious person. He had misappropriated an amount of Rs.25,000/- belonging to the bank and by committing forgery, he has committed an offence under Section 467 of the Code. It is on the above allegation that the petitioner was prosecuted. 4. The prosecution examined Pws.1 to 14 and marked Exts.P1 to P15. On the defence side, Exts.D1 to D8 were marked. The accused was examined under Section 313 Cr.P.C. 5. The court below came to the conclusion that there is no person by name 'P.V.Johny'; that the accused had, using his powers as a bank manager, forged the loan documents as if the loan is being sanctioned in favour of P.V.Johny. That the accused has also committed forgery was found by the court below in relation to the withdrawal from the Savings Bank Account and had, thereby, misappropriated the amount. On the basis of the said finding, the court Crl.A.No.900 of 1999 :: 4 :: below had come to the conclusion that the accused had committed an offence under Section 13(2) of the Act as well. 6. The accused challenges the conviction and sentence, inter alia, on the ground that the court below has not appreciated the evidence correctly. That mere suspicions have taken the place of solid proof. That glaring lapses in the investigation have not been taken note of by the court below, and what is only an expert opinion has formed the foundation for the conviction. 7. I heard Sri.P.Vijaya Bhanu, learned counsel for the petitioner and Sri.M.V.S.Namboothiri, learned counsel for the prosecution. 8. PW.1 was, at the material time, employed as the Deputy Divisional Manager, Vigilance Cell, in the Syndicate Bank, and in that capacity, he was called upon to conduct an in-house enquiry. PW.2 was the person, who succeeded the accused as the Manager in the same branch. PW.3 was working as an Assistant to the accused in 1993. Crl.A.No.900 of 1999 :: 5 :: PW.4 was working as a clerk in the same branch, from 1990 to 1993, during which period the accused was functioning as the Manager. PW.5 was also working as a clerk in the aforementioned branch of the Syndicate Bank during the same period, including the period during which the accused was the Branch Manager. PW.6 was also working as a clerk in the said branch during the period. PW.7 is a person, who is stated to be conducting a ration shop in the locality and it seems that he was examined by the prosecution to show that there is no person named 'P.V.Johny' in the address mentioned in the ration card in the ration shop run by PW.7. PW.8 is an Extra-Departmental Delivery Agent working in the post office in that area. He was examined to show that a registered letter stated to have been despatched in the name of P.V.Johny was returned with the endorsement that the addressee not known. PW.9 also had the name 'P.V.Johny'. He was examined by the prosecution, apparently in an attempt to show that the person having the name of the Crl.A.No.900 of 1999 :: 6 :: P.V.Johny, who is acquainted with the Branch Manager did not receive the amount. I may straight away mention in this context that the court below had also eschewed from consideration the testimony of PW.9 as of no use whatsoever. PW.10 is the handwriting expert, through whom was marked Ext.P9 report from the office of the Government Examiner. PW.11 was earlier working as a Chartered Accountant in the Union Bank of India, Mount Road, Chennai branch and he had signed as a witness in Ext.P8 series, which contain the specimen signatures of the accused and they were sent to the handwriting expert PW.10. PW.12 is the Assistant General Manager of the Syndicate Bank, who had given sanction to prosecute the appellant. PW.13, who was earlier working as Assistant Manager in the Syndicate Bank, was earlier working in the Thodupuzha branch working as a subordinate of the accused. PW.14 is the investigating officer. Crl.A.No.900 of 1999 :: 7 :: 9. The court below had arrived at a finding that the accused is guilty, on the basis of the following circumstances and evidence: (a) The accused was, indisputably, the manager of the Thodupuzha branch during the material point of time, 1993- 94. He, therefore, had loan sanctioning authority and indisputably a loan in the name of P.V.Johny was sanctioned by the accused. (b) Several of the details in the documents was filled up by the accused in his own handwriting. (c) The handwriting expert in Ext.P10 had given her opinion that the handwriting of the person, who has signed as Johny, in the loan application form and in the connected documents as also in the application form for opening a Savings Bank account is similar to the handwriting of the admitted specimen signatures in Ext.P8 series. Though the accused had taken the stand that he was very well acquainted with Crl.A.No.900 of 1999 :: 8 :: P.V.Johny, the accused did not take any steps to procure the presence of P.V.Johny before court and therefore, the court was constrained to come to the conclusion that P.V.Johny is a fictitious person. 10. Learned counsel for the appellant Mr.Vijayabhanu contends that the accused had acquaintance with P.V.Johny, the person, in whose favour, the loan was sanctioned, and therefore, the stand taken by the accused, as is discernible from the cross-examination of the witnesses and the 313 statement was to the effect that he had helped the loanee in filling up the loan application forms and he had also requested the clerks to help Johny in withdrawing the amount. The schedule of repayment, as is mentioned in the loan sanctioning document, will show that the amount had to be repaid in instalments of Rs.500/- each. The entire amount due to the bank was repaid by July, 1994, the last major remittance being made on 12.7.1994. It is after the Crl.A.No.900 of 1999 :: 9 :: amounts were repaid in its entirety, and the loan account was eligible to be closed, that an anonymous letter is seen to have been sent to the bank authorities alleging that there were several irregularities in the loans sanctioned by the accused as the Thodupuzha Branch and that the matter requires an enquiry. Mr.Vijayabhanu contends that it is not a matter of insignificance that the entire amount due to be repaid was actually repaid well before the allegation was raised by any person, that there were irregularities in the particular loan transaction. It was further contended that all that has been proved in the instant case is that the accused had helped the loanee in filling the application forms and in certain other connected documents and this did not, in any manner, suggest that the loanee is a fictitious person. It was further contended that the best evidence possible in the matter of the existence of P.V.Johny, was not placed before the court by the prosecution. It was further contended that the opinion of the handwriting expert PW.10 was confined Crl.A.No.900 of 1999 :: 10 :: only to the disputed signature of Johny in the disputed documents, and Ext.P8 series, which contain the signature of the name Johny elicited from the accused by the investigating officer for the purpose of investigation. The admitted handwriting of the accused as the Branch Manager in these documents and several other documents, which were easily available in the branch were not put to the expert or his superior. This fact has been admitted to by PW.14 investigating officer. The opinion of the handwriting expert, obviously could not form the basis of conviction, in the absence of corroboration. 11. Learned counsel for the prosecution, on the other hand, submits that the existence of P.V.Johny as such has not been proved by the accused. In fact, the evidence on record will show that there is no such person. If that be so, the Branch Manager, who had sanctioned loan to P.V.Johny, in sanctioning the loan, was clearly liable to be punished for forgery and misappropriation. As a public servant, his Crl.A.No.900 of 1999 :: 11 :: actions would, therefore, also be treated as an offence under Section 13(2) of the Act. 12. The finding arrived at by the court below is that P.V.Johny is a fictitious person and the evidence on record would definitely lead to the conclusion that he is a fictitious person. PW.1 Vigilance Officer of the bank conducted an in-house enquiry and he has filed Ext.P1 report. He deposed that he had verified the property tax assessment registers retained in the Thodupuzha Municipality to find out who was the occupant of house No.76 of Ward No.II of the Thodupuzha Municipality. The said house is in the name of one Ramachandran and according to him, he had made enquiries about the whereabouts of the borrower in and about Thodupuzha and on enquiry he was convinced that a binami name was given in the loan application form, his account opening form etc. Reference is made in Ext.P4 to a payment of Rs.495/- made into the account of the loanee pursuant to a cheque discount effected on 1.3.1995. Based Crl.A.No.900 of 1999 :: 12 :: on the same, PW.10 had stated in the enquiry report (to a question as to whether the statement made in Ext.P1 report to the effect that the fact that a cheque for Rs.500/- was discounted to P.V.Johny indicates that he is fictitious person), PW.10 gave a reply that it was partially correct. I find force in the submission made by the learned counsel for the appellant that PW.10 did not seem to have pursued any line of enquiry with the owner of the building, address in relation to which was given in the application form, viz., Sri.K.Ramachandran. At any rate, the best method possible, in this regard, regarding the fictitious address was to have examined the owner of the building himself. It was not done. PW.2 was the Branch Manager who succeeded the accused. PW.2 proved Exts.P2 and P3 series, which are the loan application and connected documents and pay-in-slips indicating remittance of amounts into the loan account under the name P.V.Johny. PW.2 deposed that he is able to identify the handwriting and signature of the accused. Thus, Crl.A.No.900 of 1999 :: 13 :: the handwriting of the accused in the loan application and connected documents was identified by PW.2 and it was through him Ext.P2 series were marked. Ext.P3 is the application form for opening a Savings Bank account and the signature of the Branch Manager, who had introduced the loanee is also identified. He also deposed regarding the withdrawal of Rs.24,000/- on 9.9.1993 from the Savings Bank account in the name of P.V.Johny. But there were two aspects, which were highlighted in his cross-examination. The first one related to a request alleged to have been made by P.V.Johny for closure of the account by way of a letter which is seen to have been sent through one C.J.Mathew. PW.2 testified that he did not act upon the said letter to close the loan account because he did not know the bearer of the letter Sri.C.J.Mathew. He also testified that he had accompanied the officer to the Zonal Office in the matter of enquiry into the allegations regarding the sending of letter in favour of P.V.Johny. Learned counsel for the appellant Crl.A.No.900 of 1999 :: 14 :: submits that this letter, which is stated to have been sent by P.V.Johny, directly in favour of his successor Branch Manager requesting the closure of the account by the Branch Manager is a vital piece of evidence. Whether PW.2 has acted or not is a different matter. But, there is no explanation for the non-production of the letter. 13. I am inclined to accept this submission and I am also of the view that there does not seem to be any tenable reason why the said letter was not produced. The non-production of the said letter assumes significance in the light of the stand taken by the accused when questioned under Section 313, that the entire process has been engineered by a person, who had an axe to grind against the accused. A detailed version has been given in this regard by him in his 313 statement. Considering the fact that prosecution has alleged that P.V.Johny is a fictitious person, the production of the letter stated to have been sent by P.V.Johny and addressed to the successor manager PW.2, to Crl.A.No.900 of 1999 :: 15 :: close the loan account in question, would have been of vital importance. PW.2 admits the receipt of the letter. But, the letter is not produced before court. In the normal course of events, the source of the letter should have been attempted to be traced out. 14. I agree with the learned counsel for the appellant that if the source of the letter had been traced to the accused, the same would have clinched the case in favour of the prosecution. Why was such an attempt not made? Was there any attempt to trace the source of the letter? Was it not a matter of genuine importance in the light of the prosecution case that P.V.Johny is a fictitious person? Absence of reasonable explanation to the aforementioned queries throws a doubt in the mind of the court as to the acceptability of the prosecution case in this regard. 15. There is yet another aspect emanating from the testimony of PW.2, which required elucidation by the Crl.A.No.900 of 1999 :: 16 :: prosecution, but it was not forthcoming as such. PW.2 in cross-examination, to a specific question whether he received a registered letter from P.V.Johny on 26.10.1995, deposed that he does not recollect. But then he immediately said that he remembers having despatched some such letter to the Zonal Office or to the Regional Office. He again was not able to recollect whether he had mentioned at the stage of vigilance enquiry that he had received a letter from P.V.Johny. Significantly, the investigating officer, while being examined as PW.14, to a specific question whether he came across such a letter dated 26.10.1995 issued by P.V.Johny to the Branch Manager, Syndicate Bank, Thodupuzha intimating change of address replied that he was not able to answer the said question. It is only reasonable to infer that if a registered letter was received by PW.2, the Branch Manager at that time, from a person called P.V.Johny and forwarded to the Zonal Office, it should naturally have been placed before the investigating officer by the bank Crl.A.No.900 of 1999 :: 17 :: authorities. That the investigating officer did not come across such a letter is clear from his testimony. PW.2 says that he remembers having sent a letter of a like nature to the Zonal Office or Regional Office. The letter as such is not forthcoming. The letter assumes significance inasmuch as that it is a registered letter sent in October, 1995 by a person, whom the prosecution alleges to be fictitious. Had such a letter been placed before the investigating officer, in the normal course, the investigating officer would have taken steps to ascertain its source. As rightly pointed out by the learned counsel for the appellant, had the said letter been verified and it was detected that the accused himself was responsible for the despatch of such a letter, then again the said letter would have been a clincher insofar as the prosecution case is concerned. Taking note of the testimony of PW.2 that he had forwarded a letter like the nature to the Zonal Office or Regional Office, coupled with the testimony of PW.10 that he had not come across such a letter, it is Crl.A.No.900 of 1999 :: 18 :: reasonable to draw an inference that the letter had actually been received. The contention of the accused that there is suppression of material facts having bearing on the question which came up for consideration before the court below, deserves acceptance. 16. PW.3, who was working as an Assistant Manager in 1993 when the accused was the Manager, speaks about having met P.V.Johny at some point of time, though he does not remember having met P.V.Johny at the time of disbursal of the loan. PW.3 was declared as hostile. It is relevant to take note that when he was cross-examined he deposed to the effect that what was done by the accused in relation to the loan in question is what is normally being done by branch managers. Apparently, many of the columns were actually filled up by the accused, who was the Branch Manager. Such a facility seems to be part of the service that is normally rendered by the bank officials, especially in relation to persons of acquaintance and new customers. Crl.A.No.900 of 1999 :: 19 :: PW.4 was cross-examined apparently in an attempt to show that the accused had in June, 1994, summoned him and entrusted him with Rs.23,000/- to be deposited in the account of P.V.Johny and P.V.Mathew. In cross-examination, he deposed that apart from the accused, his family members and another person were present when he had been summoned by the accused to his house. He deposed that he later came to understand that it must be P.V.Johny. The disturbing feature which was noticed in the course of cross- examination of PW.4 is that the moment PW.4 in his cross- examination mentioned that he came to know that the person who was found in the house of the accused on 6.6.1994, when he had gone their as requested by the accused was Johny, who had taken a loan, the Public Prosecutor seems to have sought permission to cross-examine this witness, who was being cross-examined at that point of time by the defence. The accused had raised an objection, but nevertheless the court overruled the objection. The Crl.A.No.900 of 1999 :: 20 :: court permitted such a witness to be declared hostile and then he was cross-examined by the prosecution itself. In certain circumstances, the witness could be permitted to be declared hostile, in which case, he can permitted to be cross- examined by the prosecution itself. But such permission to declare a witness hostile and to be cross-examined will have to be asked for and obtained when the witness is either in the box for examination in chief or in certain cases, when he is being re-examined. The procedure adopted by the court below, in the course of cross-examination of PW.4 seems to be most uncommon and unusual. Be that as it may, PW.4 testified that he came across a person by name Johny present on 6.6.1994 at the house of the accused. If the version is corroborated, then there is nothing unusual about, the accused requesting his subordinate officer to come to his house and entrusting money with the said staff to be deposited in the name of the loanee. It has been the case of the accused that he not only was acquainted with P.V.Johny, Crl.A.No.900 of 1999 :: 21 :: but also with his father. It is also the case of the accused that his father was the friend of P.V.Johny's father. 17. Learned counsel for the appellant submits that the evidence regarding any misappropriation by the accused seems to be completely scanty. Reference is made to Ext.P3 withdrawal slip relating to the withdrawal of Rs.24,000/- on 9.2.1993. PW.4 was a clerk at that point of time. He did testify that he had initialled payment of cash in Ext.P3(e) slip, as he was sitting in the cashier's chair at that point of time. But, he disclaimed any identity of the person to whom the amount was paid. He did not say that he had handed over the amount to the accused. He was also declared hostile. He further stated that he did not tell the investigating officer that the identity was not mentioned on the reversal of withdrawal slip because he had given the money to the Branch Manager. The officer, who had disbursed the cash from the loan account has, therefore, testified that the money was handed over to a stranger and Crl.A.No.900 of 1999 :: 22 :: the money was not handed over to the accused. The records in the bank shows that money was received by the loanee. Remittances towards repayment of the said amount are seen to have been made in the name of the loanee. The staff, who deposed that he was the cashier, who had actually made the payment specifically denied the suggestion that he did not say that the money was handed over to the accused at the time of withdrawal. In these circumstances, an inference that there were a series of manipulations by the accused and he had actually received the money in the name of P.V.Johny has not been substantiated with reliable evidence. I find it difficult to accept the case of the prosecution in this regard. 18. Learned counsel for the prosecution referred to the evidence of PW.10 the handwriting expert, who has opined that the signature stated to have been made by Johny in the disputed documents seems to be made by the same person, who has signed in Ext.P8 series specimen signatures was rightly accepted by the court below and if that version is Crl.A.No.900 of 1999 :: 23 :: accepted, it is clear that P.V.Johny is a fictitious person and his name was being used by the accused to misappropriate