The High Court · 2025

petition under section 528 of BNSS praying that in the circumstances stated in the lVlemorandum of Grounds of criminal Petition, the High court may be pleased grant stay of all further proceedings rncluding the appearance of the petitioners/ Accused Nos 2 and 3 rn CC No. 12 0f 2021 0n the file of the I Additional Special Judge for CBI Cases, Hyderabad, at Nampally pendlng disposal of the Criminal Petition This Petition comrng on for hearing, upon perusing the l"4emorandum of Grounds of crimina Petition and upon hearing the argum€nts of Sri K Raghava Charyulu, Advocate for the Petitioner and Mr. T. Srulan l(umar Reddy the standing Counsel for CBI for the Respondent No 1 The Court made the following: ORDER THE HON'BLE SMT. JUSTICE TIRUMALA DEVI EADA CRIMINAL PETITION N 0.11426 ot 2025 ORDER: This criminal petition is filed seeking to quash the proceedings in CC No.'1 2 of 2021 against the petitioners- accused Nos.2 & 3 on the file of l-Additional Special Judge for CBI Cases, Hyderabad at Nampally, for the offences under Sections 1208 read with 420, 409, 468 and 471 IPC and Section 13(2) read with 13 (1 ) (c) and (d) of the Prevention of Corruption Act, 19BB

2. Heard [Vlr.T. Raghava Charyulu, learned counsel for the petitioners and Mr. T. Srujan Kumar Reddy, learned Standing Counsel for CBI for respondent No.1 3 Learned counsel for the petitioners submitted that the Bank has come forward for One Time Settlement (OTS) and once OTS is accepted, the crinrinal proceedings cannot be initiated in view of the judgment of the Hon'be Apex Court in Tarina Sen v. Union of lndial. .(l0l.l) t0 S('R ll7 2 ETD,J Ctl P. No 11,126 o12025 -E 4 Learned Standing Counsel for (lUl has submitted that accused Nos.2 and 3 in the Tarina Sen,s case, who were consprrators. passed away, then the Hon,ble S;Lrpreme Court has considered the case of the wives of the consprrators, accused therein. That the facts of the present case differ from the above mentioned case and hence, the submission of tre learned Senior Counsel for the petitioners does not fall for <:c,nsideration. He further submitted that the petitioners herein ale alleged to have misappropriated an amount of Rs..1g2.gB Crores and the allegations do disclose that they entertain malafi,le intention from the inception of the crime and they have deposited false valuation reports and obtained loans and subse,1uenfly, the sard properties under the loan accounts were declared to be NpA. Thus, the accused herein have resorted to swiping of the public money by creating factious documents and obtaining loans and diverting to their own accounts. 5 The learned Standing Counsel further submitted that in Central Bureau of lnvestigation v. Manincler Singh2, the High Court had quashed the proceedings against the accused therein but, the sard orders were set aside by the Hon,ble Apex (10 l() ) lS( ( iil,r 3 ETD,J Crl-P. No.11426 of 2025 Court. Learned Standing Counsel further relied upon the decision of the Hon'ble Apex Court in Parbatbhai Aahir @ Parbatbhai Bhimsnhbhai Karmur and others v' State of Gujarat and another3. He further submitted that entering into OTS absolves the civil liability, but not the criminal liability and he therefore, prayed to dismiss the petition. 6 7 Perused the record The petitioners herein are alleged to have forged the documentsbyshowingfalseexistenceoffishtanks(Pisciculture) and obtained loans, and after obtaining loans, they diverted the amounts to their own accounts. The allegations do point out a serious economic offence. The lnvestigating Agency has collected necessary material during the course of investigation' which needs to be tested during the course of trial' B. ln Tanira Sen's case ('l supra), the matter was compromised between the borrowers and the bank upon payment under the OTS. The loan of the borrower has been closed. Therefore, the only question was whether to continue the criminal proceeding or not Wherr the matter his reached the (r0t-)r) S( ( 6lt 4 ETD.J Crl.P. No-11426 o{ 2025 Apex Court the actual accused i.e. conspirak)rs were expired - The case was only against two women i.e. accused Nos.4 and 5, accused No 4 was the wife of accused No.2 an,J accused No.5 was the wife of the brother of accused No.2. Therefore, continualion of the proceedings against the app:llants therein i.e accused Nos.4 and 5 was held to be abuse of process of law and hence, the same was quashed

9. ln Parbatbhai Aahir's case (3 supra), a Three Judge Bench of the Hon'ble Apex Curt has held that 'Economic offences involving the firrancial and economrc well-berng of the state have implicatic ns which lte beyond the domarn of a mere dispute bet\&e(ln private drsputants The High Cou( would be justified rn declining to quash where the offender is involved in an activity akin to a frnancral or economrc fraud or misdeme,trour. The consequences of the act complained of upon .he financial or economic system will weigh in the balance.'

10. ln Central Bureau of lnvestigation v. Maninder Singh's case (2 supra), the Hon'ble Apex Court l^eld that: ''The allegation against the responden s 'forgery' for the purpose of cheatrng and use of forgec documents as genurne in order to embezzle the public nrcney. After facing such serlous charges of forgery, the r3spondent wants the proceedings to be quashed on accolrnt of settlemenl with the bank. The development n means of 5 ETD,J Crl.P. No.11126 of 2025 communication, science & technology etc. have led to an enormous increase in economic crimes viz. phishing, ATM frauds etc. which are being committed by intelligent but devious rndividuals invoivtng huge sums of public or government money. These are actually public wrongs or crimes commitled against society and the gravity and magn(ude attached to these offences is concentrated at public at large. ' 11 In Central Bureau of lnvestigation v. Hari Singh Ranka and Othersa, the Hon'ble Apex Court held that: '!n the aforesald backdrop of facts, we take into consrderation the effect of OTS. lt is apparent that a large number of documents were filed by the CBI along with the Charge sheet. There are serious allegations in the instant case leveled against the accused persons of using fabrrcated documents whereas there was no supply or no srrch transactions took place. The letter head of M/s. Ivlodern Denrm Ltd.- Accused 13 had aiso been used. lt passes comprehension how the trial court has given a clean chrt thai offence falls short of constituting the conspiracy uncjer Section 120 B lPC. The trial court has not cared lo refer to the aforesaid various materials which have been alleged to be fabricated /forged and as to how the misuse of bank funds was made. ln our considered oprnion, in the facts of the instant case, the manner in which the trial court has discharged the accused persons, in spite of the cverwhetming materials on record, could not be said to be legally justrfied order at all. The OTS merely deals with the ctvi! iiabtllty that too by making of payment of Rs.25 crores '(l.Ji()) i6 SC( 6li ETO,J Crl.P. No.11426 of 2025 - whereas outstanding liability v,.,as Rs.44 crcres though it was submitted loss caused was approx. 13 )rlres Be that as it may, we are not on the civjl liability. Jltimately, the amount which has been set ed ln OTS Schenre cannot be legally sufficient to wipe out lhe criminal ti;rbility of the accused persons. The OTS could wipe off only the civil liability, of the accused not the criminal one However, this may not be taken to be the ultimate conclusicn on merits of the case, it would be open to the trial court to record any finding after the trial of the case ',

12. The abo,,re cited decisions squitrely apply to the present case. The petitioners herein are allelled to have forged certain documents showing false existenoe of fish tanks, obtained loans and diverted the amounts to their accounts and the alleged misappropriation is to an extent of Frs.192.9g crores. Thus, even if OTS is arrived at. it would not wioe out the criminal liability of the accused persons, as per the princ;iple laid down in CBI v. Hari Singh's case (4 supra).

13. ln the light of flre above said decsions parbatbhai Aahir's case (3 supra), C.B.l. v. Maninder Singh,s case (2 supra) and C.B.l v. Hari Singh Ranka,s case (4 supra) and in view of the foregoing discussion, the criminal petition lacks merit and hence, the same is liable to be dismissed. 7 ETD,J Crt-P- No.11426 of 2025 T',l

12. Accordingly, the Criminal Petition is dismissed lVliscellaneous Petitions pending, if any' shall stand closed '^?t'tr"f-\H[t?[XA //TRUE COPY// SECTI ICER +r""3[.."itsj;f st'{"L"jjd1;s,:F5tS,ik""'-,#};,,#:, b""'"?" to srl. K Raghava Charyulu' Advocate [oPUC] To,

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