Uday Umesh Lalit, J. - (1.) Leave granted.
(2.) This Appeal challenges the judgment and order dated 08.08.2018 passed by the High Court (The High Court of Karnataka at Bangalore) allowing Criminal Revision Petition No.834 of 2015 preferred by the Respondent No. 1; and thereby discharging the Respondent No.1 of the offences punishable under Sections 419, 420, 467, 468, 471 read with Section 120B of the Indian Penal Code, 1860 ('IPC', for short) and Sections 13(1)(d) and 13(2) of the Prevention of Corruption Act, 1988 ('the Act', for short).
(3.) The Respondent No. 1 retired on 31.10.2012 as Assistant General Manager, Vijaya Bank. On 28.10.2013, FIR being RC 12(A)/2013 was registered pursuant to complaint given by the General Manager, Vijaya Bank, Head Office, Bangalore against the Respondent No.1 in respect of the offences mentioned hereinabove. After completion of investigation, charge-sheet was filed on 31.10.2014 against the Respondent No.1 and other accused in respect of said offences. It was alleged inter alia :- "3. That Shri B.A. Srinivasan (A-1) while working as Assistant General Manager (AGM) and Branch Head, Vijaya Bank, Mayo Hall Branch, Bangalore during the period from 11.01.2010 to 20.10.2012 entered into a criminal conspiracy with Shri B.Lakshman (A-3), Smt. Shanta Gowda (A-4) and Shri S.V. Isloor (A-5) to cheat and defraud Vijaya Bank, Mayohall Branch, Bangalore and to extend undue financial accommodation to M/s. Nikhara Electronics and Allied Technics (A-2) on the basis of fake and fabricated documents and in furtherance of the said criminal conspiracy, Shri B.A. Srinivasan (A-1) sanctioned and disbursed Rs.200 lakhs of Term Loan and Rs.100 lakhs of Cash Credit Hypothecation (Working Capital) in favour of M/s. Nikhara Electronics and Allied Technics (A-2) without proper due diligence and in gross violation of all extant rules and regulations of Vijaya Bank, and hence, facilitated A-3 and A-4 to divert the loan-funds against the terms and conditions, thereby causing wrongful loss to Vijaya Bank and corresponding gains to others. ... ... ... 8. That Shri B. Lakshnian (A-3) and his wife Smt. Shanta Gowda (A-4) fraudulently created an agreement dated 10.06.2011 on the photocopy of estamp paper having franking No.57724 dated 08.06.2011 and submitted a copy of the same to Vijaya Bank to support their dishonest claim of taking over M/s. Nikhara Electronics & Allied Technics, proprietary concern by making a payment of Rs.1.00 Crore as goodwill to Shri Venkataramana Bhat (A-6). Shri B.A. Srinivasan (A-1) dishonestly accepted the photocopy of the agreement intentionally omitting to ascertain its genuineness or authenticity. It is revealed that the above agreement was fraudulently created on the photocopy of e-stamp paper franked vide 57724 dated 08.06.2011 and the original stamp paper remained blank was seized from the office premises of Shri S.V. Isloor (A-5). It is thus established the fraudulent intentions of all the accused persons to create forged documents as and when required and to misrepresent that the proprietary unit was taken over by A-3 and A-4 from A-6. 16. That Shri B.A. Srinivasan (A-1) in furtherance of criminal conspiracy with the other accused dishonestly, by abusing his official position as AGM & Branch Head of Vijaya Bank, Mayohall Branch fraudulently considered the loan application, processed loan proposals in gross violation of the rules and regulations of Vijaya Bank in this regard in order to favour the accused persons. He intentionally accepted the inflated financial statements submitted by A-3 and A-4 even though they were not audited and considered them for working out the credit assessment of the borrower firm i.e., M/s. Nikhara Electronics and Allied Technics (A-2). He purposely did not exercise due diligence to analyse the financial statements submitted by the borrower firm which contained several inconsistencies. He also did not conduct the mandatory pre-sanction verification at the address of the borrower firm to ascertain whether any business activities such as manufacturing of electric equipment etc., were going on as claimed in the loan application. The criminal acts of Shri B.A. Srinivasan (A-1) facilitated the accused private persons to misrepresent the existence of M/s. Nikhara Electronics and Allied Technics (A-2), which actually existed only on the forged partnership deed dated 10.06.2011, created by A-3 and A-4. 17. That Shri B.A. Srinivasan (A-1) prepared the Credit Process Note himself and obtained the signatures of Shri Jyoti Prakash Shetty, the then Asst. Manager in the column of appraising official. Shri Nabeel Ahmed, the then Probationary Manager was also made to put his initials in the process note, merely as a token of his training. It is revealed that A1 prepared the proposals for an aggregate amount of Rs.300 lakh (term loan of Rs.200 lakhs and cash credit of Rs.100 lakhs) as against the request for Rs.350 lakhs (term Loan of Rs.200 lakhs; working capital of Rs.130 lakhs and Bank Guarantee of Rs.20 lakhs) without there being any clarification/justification for such reduction in the requirements of the applicant. 18. That Shri B. Lakshman (A-3) fraudulently submitted a forged Letter No. REFREF: SP: QT: 155: 2011 dated 10.08.2011 purportedly signed as JAK, Partners, M/s. V-Tech Engineering Enterprises along with Quotations/Proforma Invoices for an aggregate amount of Rs.2,69,60,496/- which were purportedly issued by M/s.V-Tech Engineering Enterprises. ... ... ... 33. That Shri B.A. Srinivasan (A-1) was also fully aware that property offered as collateral security was in occupation of third parties (tenants). However, A-1 dishonestly and fraudulently chose to ignore this important fact, in spite of his field inspection and also the observations made by the valuer in his Valuation Report. Concurrent Auditor of the Bank also pointed out this fact in her report adding that the tenants in occupation of collateral security would adversely affect the interests of the bank, in the event of necessity, to enforce sale of the property to recover its dues. It is also revealed that tenants were paying rents to Shri Nagesh s/o late Krishnappa, who sold the property to Shri Nilakanth Sanikop, from whom A-3 purchased the property. A-1 intentionally omitted to make any endeavour to ascertain the nature of rights of the tenants, despite the fact that in future it would affect the enforceability of the mortgaged property by the bank. 34. That Shri B.A. Srinivasan (A-1) also violated the extant rules of the bank by not obtaining the Legal Audit Report, on the mortgaged property, prior to processing and sanctioning of loans to M/s. Nikhara Electronics and Allied Tekchnics. Shri B.A. Srinivasan (A-1) obtained this report only on 19.04.2012, more than six months after the loan was sanctioned and disbursed. 35. By the above said acts, Shri B.A. Srinivasan (A1), the then AGM, Vijaya Bank, Mayo Hall Branch, Bangalore; M/s. Nikhara Electronics and Allied Technics (A-2); Shri B. Lakshman @ Lakshman Reddy (A-3); Smt. Shanta Gowda (A-4); Shri S.V.Isloor (A-5) and Shri Venkataramana Bhat (A-6) committed the offences of cheating and personating as proprietor, M/s. V-Tech Engineering Enterprises, committed forgery of documents such as Quotations, Cash/Credit Bills, vouchers etc. for the purpose of cheating, using the forged documents as genuine in pursuance of the criminal conspiracy among themselves, thereby causing wrongful loss to the bank and corresponding gains to themselves and others. Investigation also establishes that Shri B.A. Srinivasan (A-1) committed the offence of criminal misconduct by gross abuse of his official position as the then AGM of Vijaya Bank, Mayo Hall Branch, Bangalore, and caused accrual of pecuniary advantage to the accused private persons, attracting the penal provisions of the Prevention of Corruption Act, 1988. That, the above acts of Shri B.A. Srinivasan (A-1), M/s. Nikhara Electronics and Allied Technics (A-2), Shri B. Lakshman (A-3), Smt. Shanta Gowda (A-4), Shri Shripad Vishwanath Isloor (A-5) and Shri Venkataramana Bhat (A-6) constitute offences punishable u/s 120-B r/w 420, 419, 468 & 471 IPC and 13(2) r/2 13(1)(d) of the Prevention of Corruption Act, 1988. 36. That Shri B.A. Srinivasan (A-1) is retired from the services of Vijaya Bank on 31.10.2012; hence sanction for prosecution u/s 19 of the PC Act, is not required.";