CR.MA/9451/2008 1/17 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD CRIMINAL MISC.APPLICATION No. 9451 of 2008 WITH CRIMINAL MISC.APPLICATION No. 9452 of 2008 TO CRIMINAL MISC.APPLICATION No. 9486 of 2008 WITH CRIMINAL MISC.APPLICATION No. 9488 of 2008 TO CRIMINAL MISC.APPLICATION No. 9509 of 2008 For Approval and Signature: HONOURABLE MR.JUSTICE M.R. 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 ? ========================================================= DEVENDRAPRASAD BHAGWANJI PANDYA - Applicant(s) Versus STATE OF GUJARAT - Respondent(s) ========================================================= Appearance : MR IH SYED for Applicant(s) : 1, MR RC KODEKAR ADDL.PUBLIC PROSECUTOR for Respondent(s) : 1, ========================================================= CR.MA/9451/2008 2/17 JUDGMENT CORAM : HONOURABLE MR.JUSTICE M.R. SHAH Date : 23/09/2008 ORAL JUDGMENT 1. Rule. Mr.RC Kodekar, learned Additional Public Prosecutor waives the service of notice of rule on behalf of the respondent – State. 2. At the request of the learned advocates appearing on behalf of the respective parties, all these matters are taken up for final hearing today. 3. As all these applications are preferred by common petitioner - accused with respect to different similar criminal complaint/cases filed against him, they are being heard together and disposed of by this common order. 4. All these applications are filed by the petitioner – original accused named Devendraprasad Bhagwanji Pandya - the then Managing Director and Chief Executive officer (“CEO” for convenience) of Madhavpura Mercantile Co- operative Bank Limited, under sec.439 of the Code of Criminal Procedure for releasing him on bail in connection with the complaints/cases being M.Case CR.MA/9451/2008 3/17 JUDGMENT Nos.5/02, 6/02, 7/02, 8/02, 9/02, 10/02, 11/02, 12/02, 14/02, 15/02, 16/02, 17/02, 8/03, 24/04, 31/04, 32/04, 33/04, 34/04, 38/04, 41/04, 207/04, 321/04, 363/04, 364/04 366/04, 372/04, 375/04, 376/04, 377/04, 379/04, 394/04, 397/04, 414/04, 1/05, 2/05 9/05, 29/05, 44/05, 108/05, 115/05, 148/05, 187/05, 198/05, 202/05, 203/05, 207/05, 210/05, 212/05, 213/05, 214/05, 219/05, 220/05, 257/05, 535/05, 536/05, 107/06, 121/06 and 104/07 for the offences punishable under secs.406, 408, 409, 420, 465, 467, 468, 471 and 120B of Indian Penal Code. 5. The case of the prosecution is that the petitioner being the Managing Director and C.E.O. of Madhavpura Mercantile Cooperative Bank Limited, in connivance with the other accused indulged in large scale irregularities in sanctioning loans of crores of rupees leaving aside the norms and guidelines prescribed by the Reserve Bank of India and creating forged documents and consequently the aforesaid bank failed and gone into liquidation affecting large number of small depositors and other small co-operative banks and thereby committed offences as alleged, for which different complaints came to be lodged with CID Crime, Gandhinagar, Zone Police Station, Prevention of Economic Offences, Gandhinagar, CR.MA/9451/2008 4/17 JUDGMENT Madhupura Police Station and Ellisbridge Police Station, for the offences punishable under secs.406, 408, 409, 420, 465, 467, 468, 471 and 120B of Indian Penal Code of Indian Penal Code. The petitioner has been arrested in connection with the aforesaid criminal cases/complaints and is in judicial custody and therefore, the petitioner submitted various applications before the Additional Sessions Judge, Court No.10, Ahmedabad u/s.439 of the Code of Criminal Procedure, for releasing him on bail in connection with the aforesaid Criminal Cases/complaints. Vide order dtd.17/1/2007, the learned Additional sessions Judge, Court No.10, Ahmedabad rejected all the applications submitted by the petitioner for bail and hence the petitioner has preferred all these petitions u/s.439 of the Code of Criminal Procedure for releasing him on bail. 6. Mr.I.A. Saiyed, learned advocate appearing on behalf of the petitioner has vehemently submitted that initially only one complaint being CR No.67 of 2001 was registered and the petitioner was arrested in connection with the said offence on 26/4/2001 and thereafter the said complaint was sent to CBI for investigation and the CBI registered the same as RC4E and thereafter the CR.MA/9451/2008 5/17 JUDGMENT petitioner was released in connection with the said offence on 7/12/2001. It is submitted that thereafter aforesaid various complaints came to be filed and again the petitioner came to be arrested in connection with the said complaints. It is submitted that during the aforesaid period on bail, the petitioner has not misused the liberty granted to him and there are no allegation of tampering against the petitioner. It is also further submitted by Mr.Saiyed, learned advocate appearing on behalf of the petitioner that so far as other accused, who are loanees/guarantors are concerned, they are released on bail and therefore, on the ground of parity, the petitioner is required to be released on bail. It is also further submitted by Mr.Saiyed that in fact, being Managing Director and Managing Director and Chief Executive Officer (“CEO” for short), the petitioner had a very limited role in sanctioning the loan and as such he was paid employee and the petitioner had no authority to sanction/disburse the loan and therefore, the petitioner is required to be released on bail. 7. Relying upon the communication dtd.31/5/2005 addressed by the Chief Executive Officer of the Bank to the Chief General Manager of the RBI, it is submitted that CR.MA/9451/2008 6/17 JUDGMENT the bank had field the aforesaid criminal cases/complaints as the management could not recover the dues and even as per the Bank the defaults on the part of the borrowers can be deemed to be on the border of criminality. It is submitted that the aforesaid was the reason to file different complaints. 8. Mr.Saiyed, learned advocate appearing on behalf of the petitioner has further submitted that even sons and relatives of the petitioner had repaid the loan taken by them. It is also further submitted that even the application submitted by the bank to join the Managing Director as party in the Lavad Suit, is also came to be rejected and therefore also the petitioner is required to be released on bail. 9. It is also further submitted by Mr.Saiyed, learned advocate appearing on behalf of the petitioner that the petitioner is in jail since last more than five years and since more than three months form the date of framing of the charge against the petitioner and there is no possibility to conclude the trial in near future and therefore, it is requested to release the petitioner on bail. It is also further submitted that at the most it can be said that the petitioner, as a Managing Director, has misused CR.MA/9451/2008 7/17 JUDGMENT his position, however, it cannot be said that the petitioner has committed any offence much less the alleged offence. 10.It is also further submitted that in one another case being Criminal Case No.5319 of 2003 in which the allegations were made against the petitioner similar to the allegations made in the present complaints, the petitioner has been acquitted by the learned Chief Judicial Magistrate, Ahmedabad Rural vide judgement and order dtd.8/4/2008 and therefore, it is requested to release the petitioner on bail, as according to the learned advocate appearing on behalf of the petitioner, there is no possibility of conviction in the aforesaid criminal complaints/cases in question. By making above submissions it is requested to release the petitioner on bail. 11.All these applications are opposed by Mr.R.C. Kodekar, learned Additional Public Prosecutor for the State. It is submitted by him that the petitioner at the relevant time was holding the key post of Managing Director and CEO and he, along with the Chairman and other Directors and office bearers of the Bank, indulged into large scale irregularities in sanctioning loans running into crores of CR.MA/9451/2008 8/17 JUDGMENT rupees, leaving aside the norms and guidelines prescribed by the Reserve Bank of India and even the allegations are that the securities/documents were got up and forged, as a result of which the aforesaid bank failed and gone into liquidation affecting large number of small depositors and other small co-operative banks and therefore, it is submitted that looking to the role attributed to the petitioner, the petitioner is not required to be released on bail. It is further submitted by him that some of the loanees and/or guarantors are released on bail on condition to deposit the entire loan amount. It is submitted that the case of the petitioner is distinguishable than that of the loanees and/or guarantors who are released on bail. It is submitted that the petitioner and the Chairman of the Bank are prime accused and their case cannot be compared with other accused persons. It is further submitted that merely because the petitioner was earlier released on bail prior to filing of the present complaints and while on bail in that offence, he did not misuse the liberty, the same is no the ground for releasing the petitioner on bail in the present complaints which are filed subsequently and which are grave and serious in nature. It is further CR.MA/9451/2008 9/17 JUDGMENT submitted that looking to the seriousness and gravity of the offences alleged against the petitioner, the petitioner is not required to be released on bail. It is submitted that having a prima facie case found against the petitioner, chargesheet has been filed against the petitioner. It is further submitted that the Chairman of the Bank, who was also one of the accused, has expired and therefore, now the petitioner is the only prime accused who has survived. It is also further submitted that the petitioner cannot be released on bail looking to the serious and grave charge against him solely on the ground that there might be delay in trial. 12.It is submitted by Mr.Kodekar, learned Additional Public Prosecutor for the State that so far as the reliance placed by the learned advocate for the petitioner, upon the judgement of the learned Chief Judicial Magistrate, Ahmedabad Rural in Criminal Case No.5319 of 2003 acquitting the petitioner, is concerned, every case is required to be considered and decided on the basis of the appreciation of the evidence on record and merely because learned trial court has acquitted the petitioner in one offence, the same is no ground to release the petitioner on bail in all these offences, as the facts and CR.MA/9451/2008 10/17 JUDGMENT evidence of the present complaints are different and it cannot be presumed that in these cases also the petitioner would be acquitted. 13.Mr.Kodekar, learned Additional Public Prosecutor for the State relying upon the decisions in the case of (i) Kalyan Chandra Sarkar v/s. Rajesh Ranjan @ Pappu Yadav and Anr. reported in (2004) 7 SCC 528 and (ii) in the case of State through C.B.I. V/s. Amarmani Tripati reported in (2005) 8 SCC 21, it is submitted that while considering the application for bail court is required to consider nature of accusation and severity of punishment in case of conviction and nature of supporting evidence. Submitting accordingly, it is requested to dismiss all these applications. 14.Heard the learned advocates appearing on behalf of the respective parties. 15.Having heard the learned advocates appearing on behalf of the respective parties and considering the material on record, it is required to be noted that the petitioner is involved in multi crores scam, as a result of which one Bank had gone into liquidation and thousands of small depositors, small co-operative banks and the entire cooperative sectors in the State of Gujarat are adversely CR.MA/9451/2008 11/17 JUDGMENT affected. At the relevant time the petitioner was CEO of the Madhavpura Mercantile Co-operative Bank Limited. The allegations against the petitioner, Chairman and others are with respect of sanctioning and disbursing the loan of crores of rupees by indulging into illegalities, irregularities and thereby they have committed malpractices, the loans came to be sanctioned either without proper verification and/or deliberately ignoring the norms and guidelines of the RBI and even the documents / securities were not obtained and/or if the same were obtained, the same were concocted and/or fabricated. Considering overall aspects of the matter, it cannot be said that there was only negligence on the part of the Managing Director. The post of Managing Director and CEO in the Bank is the very important and key post so far as transaction of sanctioning of loan in favour of loanees is concerned. The involvement of the petitioner as Managing Director and CEO is prima facie established. The allegation and accusation against the petitioner are very serious and grave. Number of complaints are filed against the petitioner and the petitioner is arrested in each of the complaints. The learned Additional Public Prosecutor for the State has relied upon the decision of CR.MA/9451/2008 12/17 JUDGMENT the Hon'ble Supreme Court in the case of Kalyan Chandra Sarkar v/s. Rajesh Ranjan @ Pappu Yadav and Anr. (Supra) and it is submitted that while considering the bail application the court is required to consider the nature of accusation and seriousness of the offence alleged against the accused person and the punishment prescribed for such offence in case of conviction and the involvement of the accused as high ranking officer as Managing Director and CEO of the Bank and against whom serious and grave allegations are made, is not required to be released on bail. 16.In the case of State through C.B.I. V/s. Amarmani Tripati (supra), the Hon'ble Supreme Court has held that while granting or refusing the bail, the court is required to consider that (i) Whether there is any prima facie or reasonable ground to believe that the accused had committed the offence (ii) nature and gravity of the charge (iii) severity of the punishment in the event of conviction (iv) danger of the accused absconding or fleeing if released on bail (v) character, behaviour, means, position and standing fleeing, if released on bail (vi) likelihood of the offence being repeated (vii) reasonable apprehension of the witnesses being CR.MA/9451/2008 13/17 JUDGMENT tampered with and (viii) danger, of course, of justice being thwarted by grant of bail. 17.Looking to the allegations and material on record, it appears that there is prima facie case against the petitioner and allegations are serious of grave offence. In the case of Anwari Begum v/s. Sher Mohammad and Anr. reported in (2005) 7 SCC 326, the Hon'ble Supreme Court has observed that though detailed examination of the evidence and elaborate taking into consideration the merits of the case is to be avoided by the Court while passing orders on bail application yet the court dealing with the bail application have to satisfy as to whether there is a prima facie case, but exploration of the merits of the case is not necessary. The court dealing with the application for bail is required to be exercised its discretion in a judicious manner and not as a matter of course. 18.Now so far as the contention on behalf of the petitioner that he is in custody since long and more than 3 months are passed after framing of the charge and the trial is not concluded and there is no possibility in the near future to conclude the trial and therefore, he should be released on bail, is concerned, in the case of Rajesh Ranjan Vs. CR.MA/9451/2008 14/17 JUDGMENT Pappu Yadav, it is held by the Hon'ble Supreme Court that merely because the accused has undergone certain period of custody by itself would not entitle the accused being enlarged on bail nor the fact that the trial court is not likely to be concluded in near future by itself or the period of incarceration would not be sufficient for enlarging the appellant on bail when the gravity of the offence alleged is severe. 19.Now, so far as the contention on behalf of the petitioner that when earlier the petitioner was released on bail, there was no allegation of tampering and/or misusing the liberty by the petitioner and therefore, he is required to be released on bail, is concerned, it is required to be noted that earlier when the petitioner was released on bail, present complaints were not filed and the present complaints are filed subsequently, and thereafter, the petitioner has been arrested in connection with the aforesaid complaints in question. What is required to be considered while deciding the bail application is the nature of the accusation in the present complaints and merely because when earlier the petitioner was released on bail in another case and the petitioner has not misused the liberty, the same is no ground to release the CR.MA/9451/2008 15/17 JUDGMENT petitioner on bail in the present complaints which are filed subsequently and the present complaints are required to be considered independently and therefore on the said ground, the petitioner is not required to be released on bail. 20.Now, the contention on behalf of the petitioner that other co-accused are released on bail and therefore, he should be released on bail is concerned, it is required to be noted that all other accused who are released on bail by this Court are, either loanees or guarantor and they are released on bail on condition to deposit the entire loan amount and so far as the present petitioner is concerned he was Managing Director and CEO of the Bank and has indulged into large scale irregularities, illegalities and muti-crores scam in different transactions and cases and therefore, his case cannot be compared with other accused persons who were loanees/guarantors. The petitioner is one of the prime accused and on account of the acts of the petitioner, the bank has gone into liquidation and even other small co- operative banks are also adversely affected. Under the circumstances, merely because some other accused persons, who are loanees or guarantors, are released on CR.MA/9451/2008 16/17 JUDGMENT bail, the petitioner cannot be released on bail. 21.Now, so far as the contention on behalf of the learned advocate appearing on behalf of the petitioner that in one similar case the petitioner has been acquitted and therefore, the petitioner should be released on bail is concerned, considering the judgement and order of acquittal in another case, it appears that on appreciation of evidence of that case, the learned trial court has acquitted the accused inclusive of the petitioner. Each complaint and criminal case are required to be considered independently on the basis of evidence on record and merely because the petitioner is acquitted in another case, it cannot be presumed that there is no evidence in the present complaints and the petitioner will be acquitted in all the the aforesaid complaints/criminal cases in question. Therefore, on that ground also, the petitioner cannot be released on bail. 22.Under the circumstances, looking to the accusation and gravity of the offence and considering the charges levelled against the petitioner and the fact that the petitioner being Managing Director and CEO of the Bank, in connivance with the Chairman and others indulged into large scale irregularities and illegalities in sanctioning the CR.MA/9451/2008 17/17 JUDGMENT loans and most of the loanees are his sons, near relatives and family members, the petitioner cannot be released on bail. 23.For the reasons stated above, as there is strong prima facie case against the petitioner, the trial court has rightly refused to release the petitioner on bail. Under the circumstances, all these applications fail and are required to be rejected and are accordingly rejected. Rule is discharged. [M.R. SHAH, J.] rafik