CR.A/360/1987 1/45 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD CRIMINAL APPEAL No. 360 of 1987 With CRIMINAL APPEAL No. 253 of 1987 With CRIMINAL APPEAL No. 324 of 1987 For Approval and Signature: HONOURABLE MR.JUSTICE MD SHAH ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= SHANTILAL MAGANLAL PANDYA - Appellant(s) Versus STATE OF GUJARAT & 1 - Opponent(s) ========================================================= Appearance in Cr.a360/1987. MR DI DESAI for Appellant. Mr.L.R.Pujari, APP for opponent no.1. MR YN RAVANI for Opponents nos. 1 - 2. ========================================================= Appearance in Cr.a253/1987 Mr.Bhargav Hasurkar for Mr. S.V.Raju, for appellants. Mr.L.R.Pujari for opponent no.1 Mr.Y.N.Ravani for opponent no.2. Appearance in Cr.a324/1987 Ms.Renu R.Singh, for appellant. Mr.L.R.Pujari, for opponent no.1 Mr.Y.N.Ravani for opponent no.1 and 2 (CBI) CR.A/360/1987 2/45 JUDGMENT CORAM; HONOURABLE MR.JUSTICE M.D.SHAH Date : 16/10/2008 COMMON CAV JUDGMENT 1. This batch of three appeals arise out of the judgment and order of conviction and sentence dated 2-4-1987 rendered by the learned Special Judge, Ahmedabad in Special Case no.13 of 1979 whereby the appellant-original accused no.1 was sentenced to suffer R.I. for a period of two years and to pay fine of Rs.5000/-, in default, R.I. for a period of six months for the offence punishable under Section 5(2) read with Section 5(1(d) of the Prevention of Corruption Act, 1947 (“the Act” for short). He was also sentenced to suffer imprisonment for a period of one year and to pay a fine of Rs.2000/-, in default, to suffer R.I. for a period of three months for the offence punishable under Section 165 of the Indian Penal Code (“IPC” for short). No separate sentence was imposed for the offence punishable under Section 161, IPC. The substantive sentences against the appellant-original accused no.1 were also ordered to run concurrently. Similarly, the accused no.2 was sentenced to suffer R.I. for a period of two years for the offence punishable under Section 120B read with Section 161, 165,420,471 of the IPC and also read with Section 5(1)(d) read with Section 5(2) of the Act. He was also sentenced to suffer CR.A/360/1987 3/45 JUDGMENT R.I. for a period of five years and to pay fine of Rs.25,000/- in default, to suffer R.I. for one year for the offence punishable under Section 420 read with section 120B of the IPC. He was also sentenced to suffer R.I. for a period of one year and to pay fine of Rs.2,000/-in default, to suffer R.I. for a period of three months for the offence punishable under Section 471 read with Section 468 of the IPC. He was also sentenced to suffer R.I. for a period of one year and to pay fine of Rs.2,000/-, in default, to suffer R.I. for a period of three months for the offence punishable under Section 471 read with Section 468 as well as read with Section 120B of the IPC. Likewise, the appellant-original accused no.3 was sentenced to suffer R.I. for a period of two years for the offence punishable under Section 120B read with Sections 161,165,420 and 471 as well as read with Section 5(1)(d) and 5(2) of the Act. He was also sentenced to suffer R.I. for a period of five years and to pay fine of Rs.25,000/-, in default, to suffer R.I. for a period of one year for the offence punishable under Sections 420 read with Section 120B of the IPC. He was also sentenced to suffer R.I. for a period of one year and to pay fine of Rs.2,000/-, in default, to suffer R.I. for a period of three months for the offence punishable under Sections 471 read with Section 468 as well as 120B of the IPC. CR.A/360/1987 4/45 JUDGMENT Similarly, the appellant-original accused no.4 was sentenced to suffer R.I. for a period of two years for the offence punishable under Section 120B read with Sections 161,165,420 and 471 as well as read with Section 5(1)(d) and 5(2) of the Act. He was also sentenced to suffer R.I. for a period of two years and to pay fine of Rs.5,000/-, in default, to suffer R.I. for a period of six months for the offence punishable under Sections 420 read with Section 120B of the IPC. He was also sentenced to suffer R.I. for a period of one year and to pay a fine of Rs.2,000/-, in default, to suffer R.I. for a period of three months for the offence punishable under Sections 471 read with Section 468 of the IPC. He was also sentenced to suffer R.I. for a period of one year and to pay a fine of Rs.2000/-, in default, to suffer R.I. for a period of three months for the offence punishable under Sections 471 read with Section 468 of the IPC as well as read with Section 120B of the IPC. However, the appellant-original accused no.5 came to be acquitted by the learned Special Judge. 1.1 In Criminal Appeal no.360 of 1987 the appellant-original accused no.1-Shantilal Maganlal Pandya challenges his conviction and sentence as stated above. In Criminal Appeal no.253 of 1987 the appellant-original accused no.2- Khalid I. Bey and the appellant-original accused no.3-Muzaffar I. Bey CR.A/360/1987 5/45 JUDGMENT challenge their conviction and sentence as stated above. In Criminal Appeal no.324 of 1987 the appellant-original accused no.4 –Mayank N.Shah challenges his conviction and sentence as stated above. 2. The facts giving rise to these proceedings as emerging from the record of the case can be summarized as under: 2.1 On 21-7-1976, a complaint came to be lodged by Shri R.S. Pandya, who was serving as Divisional Manager, Central Bank of India, Ahmedabad with the Superintendent of Police, Central Bureau of Investigation, Ahmedabad against the aforesaid accused as well as Salauddin and Vazirbegum which came to be registered as C.R. no.43 of 1976. It was alleged in the said complaint that M/s. New Russian Automobiles is a registered partnership firm situated at Mirzapur Road, Ahmedabad and that the said firm was engaged in the business of manufacturing crank- shafts for jeep, ambassador cars, tractors and diesel engines etc. According to the complaint, the firm acquired a plot of land bearing no.155, C1- B/3 Industrial Area, Naroda Taluka City District Ahmedabad and constructed industrial shed thereon. It was further the case of the complainant that the appellant- original accused no.1 was at the relevant time, serving as Branch Manager, Central Bank of India, Ghee Kanta Road, Ahmedabad whereas CR.A/360/1987 6/45 JUDGMENT the appellants- original accused nos.2 and 3 were partners of the said firm along with two other partners, namely Salauddin and Vazirbegum. According to the complainant, the appellant- original accused no.4 was at the relevant time, serving as Chief Manager (Operations) with the said firm while the appellant-original accused no.5 was serving as Office Superintendent with the said firm. It is further the case of the complainant that the appellant original accused no.2 applied to the Central Bank of India, Ghee Kanta Branch, Ahmedabad for availing of certain facilities for the firm and accordingly various facilities, namely, Term Loan Facility, Cash Credit Open Loan Facility, Usuance Bills Facility, Clean Endorsed Out-stationed Third Parties Cheques Discounting etc. to the tune of certain amount limits, which were extended from time to time and on certain occasions at the instance of the appellant-original accused no.1. According to the complainant, the accused no.2 apart from being partner of the aforesaid firm, had also floated three other fictitious sole proprietary firms at Bombay being (i) Messrs Technical Export Import Association, (ii) Messrs. Alloy Steel Corporation and (iii) Messrs Auto Parts Centre. It is further the case of the complainant that under the Usuance Bills Facility, the said firm used to offer its bills drawn on different out-stationed CR.A/360/1987 7/45 JUDGMENT parties and along with these bills were produced before the bank, railway receipt or motor receipt, the invoices for the value of the goods sold to the parties and also the hundis drawn upon the purchases and all these documents presented before the bank on behalf of the firm were signed by the accused nos.2 to 5. On such presentation before the bank, the bank used to grant the credit of the value of the bill and credit the account of the said firm with the amount for which the bills were drawn. The bank used to forward those bills with necessary documents to the out-stationed bankers named in the bill and out-stationed parties used to accept the hundis for the value of the goods sent along with the bill and the out- stationed bank used to deliver to the said party railway receipt or motor receipt along with the invoices. According to the complainant, the out-stationed parties then used to pay up the amount of the hundis o their banker within the time fixed by the hundis and such bankers used to send the necessary amount to the Central Bank of India, Gheekanta Branch, Ahmedabad. 3. It was further alleged in the complaint that all the accused persons hatched a conspiracy to cheat the said bank and they managed to get presented to the said bank certain fake motor transport receipts alleged to have been issued by CR.A/360/1987 8/45 JUDGMENT one Bombay General Freight Carriers Private Limited, Bombay and having its branch office at Ahmedabad along with bills. According to the complainant, the accused nos.4 and 5 presented to the said bank 25 bills for the total amount of Rs.18,57,064.40ps. during the period from October, 1975 to March, 1976 and in this manner, the firm availed the credit facility from the said bank against these bills by presenting fake transport receipts. On certain occasions, forged receipts were produced with Out-stationed Bills Discounted (O.B.D.) and Bills Purchased (B.P.). In all about 25 bills were presented with forged motor transport receipt and out of the said bills, 11 bills totaling to Rs.6,02,160/- were drawn upon a fictitious firm named M/s. Auto Parts Centre wherein the accused no.2 was the sole proprietor. Thus, the accused no.2 to 5 by making a false or misleading representation with fraudulent and dishonest inducement cheated the bank to the tune of Rs.18,57,064.40. According to the complainant the accused nos.2 to 5 had also made false declaration about the value of the goods by drawing bills in favour of fictitious firms. Again, M/s. Alloy Steel Corporation a fictitious firm floated by the accused no.2 though never sold and dispatched forging to the firm, raised 11 invoices in the name of the said firm amounting to Rs.44,19,000/- and fraudulently and dishonestly CR.A/360/1987 9/45 JUDGMENT induced the said bank to advance amount of Rs.30,93,300/- to the said firm against the goods of the aforesaid 11 invoices which constitutes an offence of the cheating the said bank. It is further the case of the complainant that despite this position, the accused no.1 made false representation to the bank that the dealings of the firm with the bank were satisfactory and the account is operated satisfactorily. It is also the case of the complainant that the accused no.2 made application to the bank for enhancement of the amount of various facilities granted to it and the accused no.1 favoured the accused no.2. 4. It is further alleged in the complaint that the accused no.1 being a public servant, managed to get credited at the instance of accused no.2 an amount of Rs.9,500/- on 28-11- 1975 in the joint Home Account of his sons namely Ajit and Bharat. Again on 11-2-1976 another amount of Rs.5,400/- was got credited in the said account at the instance o the accused no.3. In this fashion, the accused no.1 accepted these two amounts from the accused nos.2 and 3 as illegal gratification other than his legal remuneration. It is also the case of the complainant that the accused no.1 accepted a wrist-watch, Crown T.V.set and enjoyed a trip to Bombay at the expenses of the accused nos.2 and 3, and hence committed offence CR.A/360/1987 10/45 JUDGMENT punishable under Sections 161 and 165 of the Indian Penal Code. Mr. Gill , Investigating Officer carried out the investigation and during the course of investigation searched the house of the accused no.1 on 21-11-1976 and seized various muddammal articles such as Crown T.V., Warranty Card, wrist-watch, Metal Tea-set, passbook of the bank etc. The Investigating Officer also visited the business premises of the above referred to firms and attached necessary documents. On completion of the investigation, the accused no.1 being a public servant, necessary sanction was sought under Section 6 of the Act from the competent authority of the bank, which was granted by a sanction order dated 12-7-1979. Thereafter, charge-sheet came to be submitted on 6-11-1979 to the Court of the learned Special Judge, City Sessions Court, Ahmedabad against the appellants-accused nos.1 to 5. The learned Special Judge framed charge Exh.14 against all the accused for the offence punishable under Section 120B read with Sections 420, 161 and 165 of the IPC and also read with Sections 5(1)(d) and 5(2) of the Act as well as for the substantive offences punishable under Sections 420,161,165,467,577 IPC and Section 5(2) read with Section 5(1)(d) of the Act. The charge was read over and explained to all the accused. The accused pleaded not guilty to the charge CR.A/360/1987 11/45 JUDGMENT and claimed to be tried. 5. To prove its case against the appellants-accused the prosecution has examined in all 44 witnesses – (1) Chief Vigilance Officer Shri Mayuram Dandapani, PW 1, Exh.28, (2) Bank’s Investigating Officer Shri Pundlik Lotanrao Patil , PW 2, Exh.34, (3) Branch Manager Shri Sam Bashemji Aibara, PW 3, Exh.51, (4)Manager of Advances Department of Bank Shri Barjorji Sorabji Lahewala, PW 4, Exh.56, (5) Kiritkumar Laxmichand Shah PW 5, Exh.142, (6) Babulal Gordhandas Sagar, PW 6, Exh.148, (7) Karimbhai Fanubhai Shaikh, PW 7, Exh.152, (8) Sub- Accountant of the Bank Shri Sharadkumar Lalshanker Oza, PW 8, Exh.570, (9) General Manager of the Bank Shri Ramesh Mukund Pradhan, PW 9, Exh.1167, (10) Nazmuddin Ibrahim Lokandwala, PW 10, Exh.1202, (11) Mulchand Jamanlal Sharma, PW 11, Exh.1208, (12) Sub- Accountant Nausir Baheramsha Mistri, PW 12, Exh.1209, (13) Vibhakar Vasantro Samel, PW 13, Exh.1259, (14) Hanif Abdulrazak Motorwala, PW 14, Exh.1291, (15) Zikar Hamid Darvesh, PW 5, Exh.1329, (16) Shanker Siddheya Gajeli, PW 16, Exh.1331, (17) Sailendraprasad Suryamanisinh, PW 17, Exh.1414, (18) Additional Relieving Officer Shri Jahanbux Ratansha Postwala, PW 18, Exh.1432, (19) Internal Auditor CR.A/360/1987 12/45 JUDGMENT Shri Sudharshankumar Jashvantrai Sharma, PW 19, Exh.1433, (20) Pravinchandra Jaishanker Upadhyay, PW 20, Exh.1459, (21) Mohmad Yusuf Husenmiya Shaikh, PW 21, Exh.1456, (22) Mangesh Dhundira Kothari, PW 22, Exh.1458, (23) Sadanand Majaya Shetti, PW 23, Exh.1462, (24) Chief Cashier Shri Ramanlal Jugaldas Soni, PW 24, Exh.1469, (25) Shri Ashok Mangaldas Gandhi, PW 25, Exh.1470, (26) Anishusain Ismail Saiyed, PW 26, Exh.1472, (27) Farukh Gulamhsain Merchant, PW 27, Exh.1475, (28) Siv Atmaram Mulchandani, PW 28, Exh.1504, (29) Chandrakant Gedba Kamle, PW 29, Exh.1506, (30) Maheshbhai Chhotalal Joshi, PW 30, Exh.1507, (31) Bhupendra Ishwarlal Dave, PW 31, Exh.1514, (32)Ashvinkumar Popatlal Shah, PW 32, Exh.1516, (33) Harish Ramsundar Dasji Mahant, PW 33, Exh.1520, (34) Cashier Cum Godown Keeper Shri Bansilal Maganlal Barot, PW 34, Exh.1540, (35) Advocate Shri Rushikumar Nathalal Bhatt, PW 35, Exh.1541, (36) Onali Shamshubhai Lokhandwala, PW 36, Exh.1543, (37) Kujapan Aipan Kodapulli, PW 37, Exh.1557, (38) Investigating Officer Shri Baldevsing Kapursing Gill, PW 38, Exh.1558. (39) Miss Sabrine Shahid Latif, P.W. 39 Exhibit 1569. (40) Handwriting Expert Shri Madhusdan Lal Kirshorilal Sharma P.W.40 exhibit 1590. (41) Ashokkumar Mangal Tripathi P.W. 41 Exhibit 1601. (42) Ramnath CR.A/360/1987 13/45 JUDGMENT Choksarai P.W. 42 Exhibit 1628. (43) Kundanlal Jagirilal Joshi P.W. 43 Exhibit 1629 and (44) P.I. Shri Balkrushna Kundanlal Sharma, P.W. 44 Exhibit 1639. The prosecution has also produced certain documentary evidence. Before the trial Court none of the appellants-accused has stepped into the witness box. The appellants-original accused nos.2 to 5 have not led any evidence while the appellant-original accused no.1 has examined three defence witneses, namely, (1) Shri Rajesh Babulal Bhavsar, DW 1, Exh.1654, (2) Shri Ajit Shantilal Pandya, DW 2, Exh.1655 and (3) Shri Nyalchand Popatlal Shah, DW 3, Exh.1662. After recording the evidence of prosecution witnesses closing Purshis was filed by the prosecution. The learned Special Judge explained the circumstances appearing against the appellants-accused in the evidence led by the prosecution and the further statement of the appellants-accused under Section 313 of the Criminal Procedure Code came to be recorded, the sum and substance of which is to the effect that they were falsely involved in the case and their case was of total denial. 6. On appreciation, evaluation, analysis and scrutiny of the evidence adduced by the prosecution both oral as well as documentary, the learned Special Judge held that the accused no.1 and 5 were not guilty for the offence punishable under CR.A/360/1987 14/45 JUDGMENT Section 120B, IPC read with the other provisions of law for which they were charged and that the accused no.5 was not guilty for any of the offences with which he was charged. The learned Judge further held that the accused nos.2 ,3 and 4 were guilty of the offence punishable under Section120B read with Section 161,165,, 420 and 471, IPC and also read with Section 5(1)(d) further read with Section 5(2) of the Prevention of Corruption Act, 1947. The learned Judge further held that the appellant-accused no.1 was guilty for the offence punishable under Sections 161 and 165, IPC, and also for the offence punishable under Section 5(1)(d) read with Section 5(2) of the Prevention of Corruption Act. The learned Judge further held that the appellants-original accused nos.2, 3 and 4 were guilty of the offence punishable under Section 420, IPC and also Section 420 read with 120B, IPC. The learned Judge also held that the appellants-original accused nos.2 and 4 were guilty of the offence punishable under Section 471 read with Section 468 ,IPC while accused no.3 was guilty of the offence punishable under Sec.471 read with Section 468 and further read with Sec.120B, IPC, and therefore, passed the judgment and order of conviction and sentence as stated in para-1 of this judgment. 7. I have heard the learned Counsel Mr.D.I.Desai for CR.A/360/1987 15/45 JUDGMENT appellant-original accused no.1, learned Counsel Mr. Bharga Hasurkar for Mr. S.V.Raju for the appellants original accused nos.2 and 3, learned Advocate Ms. Renu Singh (appointed Amicus curiae on behalf of the original accused no.4 and learned A.P.P. Mr. L.R.Pujari for the respondent-State at length and in great details and have also perused the record with great care and caution. 8. Learned Counsel Mr. Raju for the appellants-accused while taking me through the entire evidence on record as also the reasons assigned and the conclusions reached by the learned Special Judge have submitted that the whole case of the prosecution is improbable, highly exaggerated and prayed that the appeal be allowed, the order of conviction and sentence passed by the learned Special Judge be set aside and the appellants-accused be acquitted of the offence in question. In support of his submission, he has raised several contentions. 9. I may state here, that since I am in complete agreement with the views expressed by the learned Special Judge, I do not deem it necessary to discuss the evidence of all the witnesses in great details and burden the record, but would only discuss the evidence and documents as are necessary for the disposal of these appeals on merits. CR.A/360/1987 16/45 JUDGMENT 10. It is necessary to mention here that pending the trial the accused no.1 preferred Criminal Revision Application no.342 of 1981 whereas the accused nos.2 and 3 preferred Criminal Revision Application no.289 of 1981 before the Hon'ble High Court of Gujarat challenging the charge framed against them as also the legality and validity of the sanction accorded by the Central Bank of India under Section 6 of the P.C.Act . However, both these Criminal Revision Applications were rejected by judgment and order dated 7-2-1984. The accused no.1 also preferred Criminal Revision Application no.123 of 1985 challenging the order of the trial Court granting permission to the prosecution to examine 11 additional witnesses, however, the same was withdrawn by the accused no.1 on 8-8-1985. Pending the trial, on 8-3-1977 even the Central Bank of India moved a suit being Civil Suit no.707 of 1977 against the firm and its partners for recovery of Rs.40,70,043.84 paise joinging them as defendants wherein all the defendants filed admission Purshis on 2-12-1980 and a decree for the said amount was passed. 11. Here, in the instant case, the learned Counsel for the appellants-accused had not made any submission on the point of sanction to prosecute the accused no.1. It may be noted that the legality and validity of the sanction Exh.31 was CR.A/360/1987 17/45 JUDGMENT challenged by the defence by way of an application Exh.48 dated 2-12-1980 before the trial Court which came to be rejected on 25-3-1981. This order was also confirmed in revision by this Honourable Court. Under the circumstances, it cannot be disputed that there is a legal and valid sanction so far as the accused no.1 who is admittedly a public servant is concerned. 12. The learned Counsel Mr.Raju for the appellants has firstly contended that the learned Special Judge has erred in holding that the accused no.1 has accepted and obtained valuable articles towards illegal gratification, other than his legal remuneration , namely, Crown TV Set of the value of Rs.4000/-, an amount of Rs.9500/-for his sons Ajit and or Bharat an amount of Rs.5400/- paid by accused no.3 and trip to Bombay by train by First Class from Bombay to Ahmedabad and return trip to Ahmedabad by plane and stay at Oberoi Sheraton Hotel from 30-10-1974 to 2-11-1974 at the expenses of accused no.2 as a motive or reward for showing a favour to the firm M/s. New Russian Automobiles and or for forebearing to do an official act of reporting to his higher authorities the unsatisfactory accounts run by the said firm in respect of different facilities, namely, (i) Rs.5,00,000/- Cash Credit (Key) Loan-Cum-Non Automatic Revolving Leeter of CR.A/360/1987 18/45 JUDGMENT Credit, (ii)Rs.5,00,000/- Documentary Demand Bills, (iii) Rs.10,00,000/-Usuance Bills and (iv)Rs.10,00,000/-Cash Credit Open Loan given to the said firm by the Central Bank of India. 13. The accused no.1 in his statement Exh.42 has admitted that he received wrist watch, T.V. Set, metal tea-set, enjoyed the trip to Bombay at the expenses of the accused no.2 and also got transferred certain amounts in the joint account of his sons. The accused no.1 also admitted that he does not know the price of the TV set and that he does not have the purchase invoice or payment receipt for the same. Shri Kiritkumar in his evidence at Exh.142 has in clear terms stated that the Muddamal Crown TV set was sold by his firm under invoice- bill copy Exh.143 on 27-10-75 for an amount of Rs.4000/- and that the firm had received payment for the same by way of cheque Exh.919 which has been realized. It is worthwhile to note that cheque Exh.919 has been drawn by the accused no.2 as partner of M/s New Russian Automobiles; that the cheque has been signed by the accused no.2 is admitted by both the accused no.1 and the accused no.2 in their respective statements before the Court. Admittedly, the bill Exh.143, the warranty card Exh.146 are in the name of the said firm. Even the khata Exh.144 has been opened by Kalpana Electronics in the name of the said firm and the firm had paid the price of CR.A/360/1987 19/45 JUDGMENT the TV set by cheque, however, the accused no.1 has put his signature Exh.910 in the column of 'customers signature' in warranty