1 IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD CRIMINAL APPLICATION NO.3574 OF 2010 Gopal Ramdas Jawale and others APPLICANTS VERSUS The State of Maharashtra and others RESPONDENTS WITH CRIMINAL APPLICATION NO.3573 OF 2010 Liladhar Pandit Kurkure and others APPLICANTS VERSUS The State of Maharashtra and others RESPONDENTS Mr.Mahesh Deshmukh h/f. Mr.B.S.Deshmukh, learned counsel for the applicants in both applications. Mr.B.V.Wagh, learned A.P.P. for State in first application. Mr.D.R.Kale, learned A.P.P. for State in second application. (CORAM : A.V.POTDAR, J.) DATE : 25/10/2010 PER COURT : 1. Both these applications arise out of the same CR No.72/2010, registered in Faizpur Police station, Dist. Jalgaon, and the applicants have approached this Court for their pre-arrest release. 2 2. Heard respective counsels for the parties. Perused the papers of investigation. 3. The record shows that interim protection was granted on 07/09/2010 to the applicants in the event of their arrest in connection with CR No.72/2010. 4. It reveals from the papers of investigation that the first applicant in Cri.Appl.No.3573/2010 is the Chairman of the Institution known as Shri Swaminarayan Gramin Bigarsheti Sah. Patsanstha Ltd.,Bamnod, Tal.Yawal, Dist. Jalgaon, while applicant no.8 in the said application is the Manager of the said Patsanstha. The remaining 6 applicants in the first application and 8 applicants in the second application are the members of the Board of Directors/ Managing Committee of the said Patsanstha. It appears that the said Patsanstha is registered under the provisions of the Maharashtra Co-operative Societies Act and the Rules thereunder, which fact is not under dispute. It appears that audit of the said Patsanstha was conducted by the Government Auditor for the period of 01/04/2006 to 31/03/2008. The report of audit was submitted by the Auditor on 02/07/2009. On the basis of said audit report, the FIR was registered on 08/08/2010. 5. Perusal of the FIR clearly indicates that illegal activities are committed by the applicants who are Chairman, Manager and the members of the Managing Committee of the said Patsanstha. During 3 the audit period, loan in the sum of Rs.41,15,000/-, was sanctioned which is due during the audit period to the tune of Rs.49,42,899/- to 7 members, who are residing out of the jurisdiction of the said Patsanstha. It is not under dispute that the said transaction at the hands of these applicants is against the bye-laws and the directions issued from time to time. The second illegality noticed during the audit period is that the applicants have sanctioned loan to the tune of Rs.12,40,231/- to 2 persons on cash-credit facility, which is not permissible. Third allegation is that the loan was sanctioned to 7 persons beyond the permissible limits to the tune of Rs.16,31,322/-. The next allegation is that the loan was sanctioned to 23 persons without taking proper security to the tune of Rs.6,02,006/-. The Board of Directors have also invested Rs.36,50,000/- with 4 institutions against the bye laws and directions issued from time to time. Thus the public funds in the hands of these applicants is to the tune of Rs. 1,20,64,658/- This loss caused during this audit period to the said Patsanstha is absolutely because of the illegalities caused due to functioning at the hands of these applicants. 6. During the course of submissions across the bar, it is tried to urge that the Board of Directors have granted the loan under the bonafide belief that they will be in a position to recover it, but the record shows that all the transactions at the hands of Chairman, Manager and Board of Directors are in violation of bye-laws and rules and directions issued to the Co-operative Societies from time to time by the State Government. 4 7. The funds in the hands of these applicants are the funds invested by the members of the Patsanstha. It is expected that while releasing these funds, the applicants, the Chairman, Manager and Board of Directors (Managing Committee) have to take proper care while granting loans and those loans to be sanctioned within the limits of the bye-laws which are applicable from time to time to the said Co-operative Institution. Considering this aspect, if the loss is caused to the Institution, and if in the result, the said Patsanstha may likely to go in liquidation, then only these applicants are liable for that. It is informed that the individual assets of these applicants are not sufficient to recover this amount due towards Patsanstha. Considering the economic offence committed at the hands of these applicants, no case is made out to exercise the discretion to enlarge the applicants on bail. Both the applications sans any merit, rejected. Interim protection, earlier granted, stands vacated. (A.V.POTDAR, J.) khs/OCT. 2010/cri.appl.3574-10