Milind Dinkarrao Chimurkar v. State of Maharashtra

to be arrested, he applied for bail in the trial court. That application was rejected. Thereafter, he applied for bail to this court. As in the meanwhile charge sheet was filed, against this applicant, liberty to apply for bail in sessions court was granted and he was allowed to withdraw the said application. Accordingly he applied for bail in the trial court. That application was rejected by the Ad-hoc Additional Sessions Judge and Additional District Judge, Nagpur vide Misc. Criminal Application No.641/2008 with the following observations : “6. The property involved in the matter yet to be recovered. Complete investigation of the matter yet to be completed against co-accused. In the present matter, no other accused are shown absconding but the prosecution 3 have made provisions for their investigation against other 29 accused by submitting charge sheet against applicant / accused only. So there is no legal impediment to conduct the trial against the present accused. 7. No doubt, “bail and not jail” is the well- cherished principle based on a right to personal liberty. It does not and cannot have dominion over larger interest, social order, public safety, public health and of course national interest or security as well as or possibility of liberty being abused. 8. Considering the nature of offence, facts and circumstances of the matter, considering large interest of the public and the State, merely because charge sheet is filed against the accused, it would not be reasonable to exercise the judicial discretion in favour of the applicant/ accused when there is prima facie case against accused. Hence, application is rejected.” Hence the applicant has approached this court for grant of bail. 5] Relevant First Information reads thus: (Translation) “During the aforesaid period of time and at the spot of occurrence, as mentioned in the complaint, the herein accused persons from serial number 1 to 30 as mentioned in the list enclosed herewith, who are the various officers, employees, Chairman, Vice Chairman, Board of Directors and Debtors namely Aman Hemani and Rajashri Hemani of Samata Sahakari Bank Limited, Branch Bhagwaghar Layout, Dharampeth, Zenda Chowk, having colluded with one another, sanctioned the loan limit of Rs.250 lakhs (Rs. hundred fifty lakhs only) by charging the less commission in the Bill Discount Account of Hemani Group without taking any mortgage and intentionally did manipulation in the Bank computer in order to hide it. Similarly, inspite of the restrictions of R.B.I. i.e. the accused persons did rephasement in the loan case of Rs.10.51 crores of M/s Naval Harsha Group and thereby violated the directions of the R.B.I.; instructions of Cooperative Department and various provisions under Banking &Regulations Act, 1949. Similarly, loan illegally, did misappropriation by violating the rules while selling the property mortgaged with the Bank, disbursed more amount of loan by accepting mortgage of less valuation. In the same way, they put the Bank to loss by violating the rules while investigating the amount in the Government Securities and Mutual Funds. Moreover, they refunded the deposits on large scale to the depositors before the maturity without obtaining the permission of the committee headed by the District Deputy Registrar, Cooperative Societies, they sanctioned huge amount of 4 Nagpur in spite of the restrictions of the Reserve Bank, which is against the rule. Similarly, in some loan cases, they compromised unlawfully while dealing under O.T.S. Scheme. In the loan case of M/s Ashok Vaults, the immovable property mortgaged against the loan was sold out and thereby committed illegal transactions. Similarly, interest on some accounts was waived unauthorizedly. In this way, the accused persons in collusion committed misdeeds. By preparing fake documents and using them as if true, they have committed Misappropriation of Rs.145,60,57,332/- crores by cheating the Bank and Bank account holders. The Chairman, Vice Chairman, Board of Directors, Officers and Staff of the Samata Sahakari Bank and others, who are the accused persons, jointly committed the said misappropriation during the period w.e.f. 30.3.1997 to 31.3.2007 by preparing fake documents and thereby cheated the Bank. On the basis of the written report given by the complainant, an offence under sections 406, 408, 409, 467, 468, 471, 420 read with 34 of the Indian Penal Code has been registered and taken up for investigation.” 6] (Translation) Relevant allegations in the charge sheet are thus : “16-Brief facts of the case (Add separate sheet, if necessary- - - - The Samata Cooperative Bank is a trustee institution of the depositors and share holders. But the Board of Directors of the said bank / Chief Executive Officer/ Branch Officer / Recovery Officer and borrowers, in collusion with one another hatched a plan and A] committed irregularity on large scale in Inward Bill Account in the account of Amanraj Hemani Group Rs.5,55,00,000/- towards committed discounting misappropriation of above mentioned amount. B] In the computer of the bank, the name of the loan account of Hemani Group was changed fraudulently and new name, address and sanction limit have been entered which is against the rules. deposited amount thereby C] Pradeep Chaudhary, the Chief Executive Officer of the bank, Shri Sanjay Deshpande, the then Branch Manager of Bhagwaghar Branch and the then Board of Directors committed irregularities on large scale in the loan case of Naval Harsh Group and other loan cases by doing rephasement of sum of Rs.10.51 lakhs against the rules when the Reserve Bank of India had imposed financial restrictions on the bank under section 35(a) of the Banking Regulation Act 1949 since 4.8.2006. The unsecured loans have been disbursed to 12 D] Groups and 15 b ig borrowers against the rules and an amount of Rs.103,32,84,480 including the interest is outstanding. As 5 sufficient pledge is not obtained in loan cases, the entire loan amount has become unsecured. The then Board of Directors of E] the bank, Shri Pradeep Chaudhary, the Chief Executive Officer of the Bank and Shri Keshav Kamle, the Special Recovery Officer committed irregularities on large scale while selling the pledged and other immovable property in the loan cases and thereby caused loss of Rs.9,09,30,003 to the bank. F] In the month of October, 2004, as the Bank did not maintain 3% and 25% in cash demand and minimum cash payable in a period and liquidity respectively as per provisions of sections 18 and 24 of the Banking Regulation Act 1949, the Reserve Bank of India has imposed the fine of total Rs.94,54,938/- and consequently the bank has suffered loss. Out of this fine amount, the bank has made payment of fine of Rs.59,68,136 to the Reserve Bank and the remaining amount of fine is not paid. Due to mismanagement and wrong investment policy of the bank, non-compliance of directives and investments made in mutual funds, government securities, S.L.R. and non- S.L.R. though the Bank was not having minimum liquidity and untimely sale thereof, the Bank has suffered financial loss of Rs.18571574.17 during the period from 2004-2005 to 2006-07. Similarly, the sale and purchase transactions of more than 5% bonds have been executed through single agent. G] On 24.05.2006, though the Reserve Bank had given instructions not to transact the business of acceptance of fresh deposits, the Bank after 24.5.2006, accepted deposits on large scale and refunded the deposits before maturity. Similarly, fresh loans have also been disbursed. During this period, the deposits of total Rs.3,94,28,008/- have been refunded to the depositors before maturity as a result of which the Bank has suffered loss. The transactions of refund of deposits before maturity are to be verified. Similarly, restrictions were though the financial the Banking imposed under section 35(a) and rule 56 of Regulation Act, 1949 with effect from 4.8.2006, the deposits have been refunded on large scale. The amount of such deposits is Rs.6,39,67,718/-. in respect of outstanding loans under H] The members of the Loan Review Sub-Committee and the then Board of Directors had compromised against the lump-sum rules, Repayment Scheme and waived the huge amounts of interest to the borrowers as a result of which the Bank has suffered huge loss. Such recoverable amount is Rs.1,57,36,091/-. I] In the loan case of M/s Ashoka Vaults, irregular transactions have taken place on large scale. As the immovable 6 In this way, by indulging in suspicious, property in the said loan case has been sold, the entire loan amount of Rs.3,39,55,649/- has become unsecured. In this case, the mortgaged property has been sold without fixing its reserved value. illegal and irregular transactions, the trust of share holders and depositors is breached. The Samata Cooperative Bank is a trustee institution of the share holders, but the accused persons have committed breach of trust of the share holders who had deposited their amount with trust, by indulging in illegal transactions and caused loss of Rs.145,60,57,332 crores to the depositors and share holders and thereby committed embezzlement and cheating. On the basis of such complaint of the complainant, the said offence has been registered.” . . registered Bank Samata Cooperative . business licence and it 30.6.1985. Bank . . omission . commenced banking transactions on 22.10.1987. Bank's functioning is limited to Nagpur, Wardha,. Chandrapur and Bhandara districts. Bank's seven branches and two extension counters are functioning in Nagpur City. Work of Samata Bank is conducted as per provision of Bye-laws of Bank. As per the orders of Hon'ble Cooperative Commissioner and Registrar, Cooperative Societies, Maharashtra State, Pune, Shri Sadanand Uikey, Chief of Mobile Squad and Special Auditor, Class I conducted audit of Samata Cooperative Bank, Nagpur and submitted report for necessary action. in the said report it is the rule are mentioned that committed and thereby defalcation is done. for the entire transactions, Board of Directors from 1997 to 2006 and Chief Executive Officer, Recovery Officer, Branch Manager of Bhagwaghar Branch and Audit Officer are held responsible. irregularities and acts against During the course of investigation of the said crime, complete documents pertaining to transactions mentioned in the audit report have been seized. In that, files of loan cases and loan sanctions to 12 big groups and 15 big loanees granted on following prevailing practice have been large scale without seized. In some cases, it is seen that the Board of Directors has sanctioned loans but mortgage is not found to have taken in proper proportion. it is revealed that loan forms of the loanees are kept blank and while auctioning mortgaged properly, no advertisements were given and tenders were called but the same were sold directly without getting done valuation. Evidence of conducting transactions against the rules viz-to-sanction I.B.P. facility to Hemani Group without taking any kind of mortgage and after their cheques returned dishonoured, to alter names and sanction limits in the account of Hemani Group in the computer and transfer the said accounts to someone else in respect of the said transactions, resolution register of Samata Bank is seized; to stick out contents of resolution register on 7 large scale of the board of directors, to over write, to leave blank spaces in the resolution register and fill the same later on to stick to sale and pages in the resolution register subsequently, purchase bonds at odd times for not maintaining liquidity and cash proportion in the bank transactions, to waive loans under the name of rephasement even when restrictions were imposed on the bank and to sell mortgaged property without doing its valuation etc. has been collected against the said accused persons. Accused Milind Dinkar Chimurkar is the President / member of Loan Sub Committee and President of Loan Review Committee, President of Investment Review Committee and also the president of th bank. As per provision of sub rule 39 and bye- law 39(A); 39(b), it was his duty and responsibility to supervise general functioning of the bank. However, he failed to discharge his duty properly. Consequently, the bank is duped by Rs.145,60,57,332/- and for the embezzlement caused thereby, he is responsible as per the evidence received. Hence charge sheet is filed against him for the sake of justice. Similarly, investigation of continued as per provision of section 173(8) of Cr.P.C. Provision is made to file supplementary charge sheet against the said accused, presently found 29 accused and the accused persons who would be found in further investigation at proper times. said crime

17. Refer Notice served: yes/ : No Date (Acknowledgment to be places) 18. Dispatched on 16.3.2006 sd/ S.D.Tayade 16.3.2006 Signature of Investigation Officer, submitting the final report/ charge sheet Name : S.D. Tayade Rank: Dy. Superintendent of Police, C.I.D. Nagpur sd/- S.D. Tayade 16.3.2006 Forwarded by Station House Officer / Officer In-charge, Name : S.D. Tayade Rank: Dy. Superintendent of Police, C.I.D. Nagpur. 7] It is necessary to note that star witness of the prosecution is one Sadanand Ukey who had conducted Special Audit of the said 8 bank. He has indicted this applicant specifically for all the lapses mentioned above, he being the Chairman. According to him, this applicant being the Chairman, had misappropriated several amounts in the bank and was responsible for the losses caused to the bank. Loans were advanced without proper documentation, without verifying the entitlement for the loan to the tune of crores. Some one line resolutions without due administrative process were inserted in the Minutes Book of the Board of the Directors to facilitate the advance of loan illegally to the concerned. 8] The perusal of the charge sheet would show that ex-facie though charge sheet is “one”, several offences were committed by the applicant and therefore, the charge sheet was filed for the aforesaid offences. The noticed misappropriation is stated to be of more than Rs.145 crores rupees and therefore, applicant was charge-sheeted for the aforesaid offences . It is also stated that the investigation, in this respect of other accused including other members of the Board of Directors and officials of bank is still being proceeded and the charge sheet is likely to be filed in near future against them. As such though the charge sheet is filed against the present applicant, investigation is still in progress in respect of this applicant as well as other accused for these offences. 9] As stated above the learned Sessions Judge has rejected the application for grant of bail of the applicant, the applicant has approached this court for grant of bail. 9 10] Learned counsel for he applicant Shri A.S. Manohar has submitted that the offence was registered on 5.11.2007 and this applicant was arrested on 27.11.2007. According to him this is the sole arrest in the present crime, and other accused are not arrested. He has also submitted that some persons have been granted anticipatory bail, some were not. It is his contention that about 12 accused have not at all applied for anticipatory bail, still they are not arrested. The C.E.O. Choudhari who is alleged to be prime accused in the present case, has not been yet arrested and in fact no attempt is made by the investigating agency, for reasons best known to it; to arrest him. He is neither declared absconder nor any attempt is made to arrest him. This applicant was in jail for about 90 days and on the 90th day the charge sheet was filed for the obvious purpose to make him not entitled for bail in default, though the investigation was not complete. It is further his case that the allegations against the applicant are only of imprudent decisions or negligence to watch the affairs of the bank. He further submitted that charge sheet is silent about the breach of the rules committed by the applicant. It is also his submission that all the documents in the present case have been seized and now nothing remains to be seized from the applicant and in fact the investigation against him is over. It is also his case that all the offences are committed by the Branch Manager Sanjay Deshpande and C.E.O. Choudhari and this applicant is booked only for he being negligent in conducting the affairs of the bank. Negligence cannot make out 10 any offence and as such he may be guilty of negligence in attending duties, but not for any offence. He further submitted that there cannot be any tampering of evidence. In fact the tampering can be done by the C.E.O., who is not yet arrested. According to him, no specific role is attributed to the applicant who is Chairman of the Board of Directors. There is no gravity of the offence and the chances of acquittal of applicant are much more. He has further submitted that the state would not be prejudiced if the applicant is released on bail. Trial is not likely to take place in near future as other accused are yet to be arrested and several other matters are pending in subordinate courts. Further there is no allegation of any tampering with the prosecution evidence against the applicant and ends of justice could be met, if stringent conditions are imposed against him. Therefore, according to him, the applicant should be released on bail. 11] He has relied on some decisions. I quote the same along with relevant observations therein. 1] (1998)9 Supreme Court Cases 611 [Dr. Jagannath Mishra ..vs.. C.B.I. “2- Considering the facts and circumstances of the case, particularly the facts that charge-sheet has already been submitted against the appellant and that at present no further investigation in this case is in progress against him we direct that the appellant be released on bail to the satisfaction of the Special Judge (A.H.Case), Patna and subject to following conditions” 2] (1998)5 Supreme Court Cases 607 [Sunil K.Sinha ..vs.. State of Bihar through S.P. CBI.] 11 “2-In view of the long incarceration of the appellant since 25.5.1996 and the trial likely to consume some time, we think that a case for grant of bail has been made out in favour of the appellant.” 3] Criminal Application No.1996/2002 [State of Maharashtra ..vs.. Ketan Parekh] dated 11.6.2002. insisted upon on behalf of the accused was necessary for “20] In the present case, the custody of none of the accused is required any more for the purpose of investigation of the case and though the custody of the accused is prosecution, it was not pointed out as to why the custody of purposes of investigation, except by arguing that a large amount of Foreign Company is involved which may have repercussions at the International level to discourage foreigners from coming to this country and make investment. Secondly, it is not the case of the prosecution that the accused are likely to abscond and not make themselves available for trial in case the charge sheet comes to be filed against them. It was argued on behalf of the prosecution that the SEBI had investigated the rules and regulations by the accused and, license of dealing and trading in shares has been cancelled. It was argued that one of the accused by name Ketan Parekh is also a notified person under the provisions Special Courts Act 1992 and that he is also an accused in a complaint filed by the Bank of India which was investigated by CBI for the bouncing of pay orders and is also involved in Madhavpura Co- op Bank Case. It is not in dispute that in both the cases of Madhavpura Co-op Bank as well as Bank of India, the accused Keatan Parekh was released on bail. He was also released on bail when he was notified in a scam case to the extent of Rs.5 lacs under the provisions of the Special Courts Act 1992. infractions of therefore, 12 the share broker and This is essentially a case between two companies, i.e. Triumph which is complaint-firm which is a company trading in shares. The pendency of the other criminal case against one of the accused and the cancellation of the brokerage license by NSE cannot be the ground for not releasing these accused persons on bail. Since the custody of the accused is no 21] longer necessary, I do not see any flaw in the order of the Sessions Court granting bail to the respondents – conditions. By the accused by imposing strict impugned order the accused are directed to be released on bail not only on the high amount of bail of Rs.2.50 lacs but the conditions imposed on the accused are very stringent. For instance, the accused cannot is filed. The remand court accused cannot leave India, without the permission the concerned court and their passports are surrendered to the authorities. The accused are also directed to report to the Investigating Agency for a period of three months and thereafter report to the Investigating Agency twice in a week for a further period of three months.” leave Bombay without permission of the charge sheet 4] AIR 1978 Supreme Court 429 [Gudikanti Narasimhulu & others ..vs.. Public Prosecutor, High Court of Andhra Pradesh] “Bail or jail?” at the pre-trial or post conviction stage belongs to the blurred area of the criminal justice system and largely hinges on the hunch of the bench, otherwise called judicial discretion. Personal (Para 1) refused, is too precious a value of our constitution al system recognised under Art. 21 of the Constitution that the crucial power to negate it is a great trust liberty, deprived when bail 13 exercisable, not casually but judicially, with lively to the individual and the concern for the cost community (Para 1) The relevant criteria for grant of refusal of bail in the case of a person who has either been convicted and has appealed or one whose conviction has been set aside but leave has been granted by the Supreme Court to appeal against the acquittal are as follows: When the crime charged (of which a conviction has been sustained) is of the highest magnitude and the punishment of it assigned by law is of extreme severity, the court may reasonably that no presume, amount of bail would secure the presence of the convict at judgment should he be enlarged. some evidence warranting, the stage of (Para 6) The nature of the charge is the vital factor and the nature of the evidence is also pertinent. The punishment to which the party may be liable, convicted or conviction is confirmed, also bears upon the issue. (Para 7) Another relevant factor is as to whether the course of justice would be thwarted by him who seeks the benignant jurisdiction of the Court to be freed for the time being. (Para 8) in this context, The legal principle and practice validate the court considering the likelihood of the applicant interfering with witnesses for the prosecution or otherwise polluting the process of justice. It is not only traditional but rational, enquire into the antecedents of a man who is applying for bail to find whether he has a bad record, particularly a record which suggests that he is likely to commit serious offences while on bail. In regard to habituals, it is part of criminoligical history that a thoughtless bail order has enabled the bailee to exploit the opportunity to inflict further crimes on the members of society. Bail discretion, on the basis 14 of evidence about defendant, irrelevance. the criminal therefore record of a exercise (Para 9) necessity The significance and sweep of Art. 21 of the Constitution make the deprivation of liberty a matter of grave concern and permissible only when the law authorising it is reasonable, even handed and geared to the goals of community good, and State The considerations set out as criteria are germane to the above constitutional proposition. Reasonableness postulates deprivation of freedom by refusal of bail is not for punitive purpose but for the bi-focal interests of justice to the individual involved and society affected. care and predicates intelligent (Para 10) in Rt.

19. a When a person, charged with a grave offence, has been acquitted at intermediate acquittal has pertinence to a bail plea when the appeal before the Supreme Court pends. The panic which might prompt the accused to jump the gauntlet of justice is less, having enjoyed the confidence of the court's verdict once. Concurrent holdings of guilt have the opposite effect. Again, the ground for denial of provisional release becomes weaker when the fact stares the court in the fact that a fair finding if that be so of innocence has been recorded by one Court. It may not be conclusive for the judgment of acquittal may be ex-facie wrong, the likelihood of desperate reprisal, if enlarged, may be a deterrent and his own safety may be more in prison then in the vengeful village where feuds have provoked the violent offence. Antecedents of the man and socio-geographical circumstances have a bearing only from this angle. Police exaggerations of prospective misconduct of enlarged, must be soberly sized up lest danger of excess the accused, injustice subtly 15 discretionary curial technique. Bad record and police prediction of criminal prospects to invalidate the bail plea are admissible in principle but shall not stampede the court into a complacent refusal. A circumstance of (Para 13) some consequence, when considering a motion for bail is the period in prison already spent and the prospect of the appeal being delayed for hearing having regard to the suffocating crowd of dockets pressing before the few Benches. The delicate light of the law favours release unless countered by the negative criteria necessitating that course. The corrective instinct of the law plays upon release orders by strapping on to them protective and curative conditions. Heavy bail from poor men is obviously wrong. Poverty is society;s malafide and sympathy, not sternness, is the judicial response. (Para 16) The petitioner in the Supreme Court, had been acquitted along with others in the trial Court although that acquittal had been set aside in the High Court. There was no suggestion possible that during the time they were on bail during the time they were on bail during the pendency of the trial and when the appeal was pending in the High Court, they abused the trust reposed by the Court allowing them to be at large and four of the accused had already been enlarged on bail by the Supreme Court. The petitioners had suffered imprisonment around a year and a reasonable prediction of the time of the hearing of the Supreme Court appeal might take a few years ahead. The Magistrate's report about the conduct of the petitioner while in subjail was not uncomplimentary. Held by the Supreme Court petitioner be directed to be enlarged on bail on their own bond to appear to receive sentence in the event 16 of the adverse verdict from the Court. (But in view of the factions in their village and likelihood that the community peace might be disturbed, proper safeguards were imposed).” 5] AIR 2005 Supreme Court 716 [Jayendra Saraswathi Swamigal ..vs.. State of Tamil Nadu] Shri Tulsi has lastly submitted that “15- prohibition contained in Section 437 (1)(i) Cr.P.C. that the class of persons mentioned therein shall not be released on bail, if there appears to be a reasonable ground for believing that such person is guilty of an offence punishable with death or imprisonment for life, is also applicable to the Courts entertaining a bail petition under Section 439 Cr.P.C. In support of this reliance has been placed on a submission, strong recent decision of this Court in Kalyan Chandra Sarkar ..vs.. Rajesh Ranjan @ Pappu Yadav & Anr. 2004(7) SCC 528. The considerations which normally weigh with the Court in granting bail in non bailable offences have been explained by this court in State ..vs.. Capt. Jagjit Singh AIR 1962 SC 253 and Gurcharan Singh ..vs.. State ( Delhi Admn.) AIR 1978 SC 179 and basically they are the nature and seriousness of the offence; the character of the evidence; circumstances which are peculiar to the accused; a reasonable possibility of presence of the accused not being reasonable apprehension of secured at witnesses being tampered with; the larger interest of the public or the State and other similar factors which may be relevant in the facts and circumstances of the case.” the trial; 6] Criminal Application No.3075/2007 [Kiritkumar Patel ..vs.. State] “ Learned Additional Public Prosecutor for the State submitted that if the present applicants are released on bail it would be difficult for the police to secure the 17 because Aniruddha Ramteke presence of Aniruddha Ramteke who has since been absconding. Simply absconding that cannot be a ground to detain the present applicants. Since offences are not punishable with death or imprisonment for life the only consideration that should weigh with the court is whether the accused would make themselves available at the time of trial and whether they are likely to tamper with the prosecution witnesses. As far as the availability of the present accused/ applicants is concerned it is not disputed that they are permanent resident of Nagpur. They are traders. It is, therefore, unlikely that they would not make themselves available at the time of the trial. After having gone through the affidavit of the State, it is not mentioned that the applicants are likely to tamper with the prosecution witnesses.” 12] As against this, the learned Additional Public Prosecutor Smt. Dangre has submitted that there is consistent attempt to arrest C.E.O. Choudhari, however, despite best efforts, he could yet not be arrested. According to her, proceedings under Criminal Procedure Code are also undertaken against him. She has submitted that there was entrustment of the material duties to distribute loans to only eligible persons from the deposits of depositors, he being the Chairman of the bank. The contention that Chief Executive Officer Mr. Choudhari and Branch Manager Mr. Deshande could have over powered Board of Directors or Chairman cannot be accepted. Why the applicant was mute spectator to the affairs in the bank is not explained. He being Chairman is responsible for all the things, misdeeds & offences moreover, because he was the Palak Director of the relevant branch. She has also relied one instance to show that 18 in fact the applicant had withdrawn amount of Rs.20,00,000/- from the bank despite moratorium issued by the Reserve Bank of India and the loan which allegedly adjusted but could not have been adjusted by withdrawing the amount. 13] She has also relied on many authorities which are thus: 1] AIR 1962 Supreme Court 253 (V.49 C 45) (The State ..vs.. Captain Jagjit Singh) 2] (1980)2 Supreme Court Cases559 (Niranjan Singh and another ..vs.. Prabhakar Rajaram Kharote and others) 3] (1987)2 Supreme Court Cases 364 (State of Gujrat ..vs.. Mohanlal Jitamalji Porwal and another) 4] (2006)6Supreme Court Cases 736 (Indian Oil Corporation..vs.. NEPC India Ltd. and others) 5] (2007)5 Supreme Court Cases 403 (Soma Chakravarty ..vs.. State through CBI) 6] AIR 1960 Supreme Court 889 (V 47 C 154) Jakrishandas Manohardas Desai and another ..vs.. State of Bombay) 7] (2003)3 Supreme Court Cases 641 (Ram Narayan Popli ..vs.. Central Bureau of Investigation ) Some of them being guiding principles regarding grant of Bail in serious economic offences. 14] Her main contention is that the offences against the applicant are proved in the investigation and they are substantiated 19 by the evidence of P.W. - Sadanand Ukey who had audited the bank accounts and submitted detailed audit report, in this context & also by other witnesses and even by self explanatory fact that no such loans were repaid by concerned, as agreed. 15] It appears that ex-facie the offences are made out, as the applicant was the Chairman i.e. the person at the helm of affairs of the bank and who was responsible for everything that is happening in the bank as regards advancement of loans by one line inserted resolutions in minute book of sanctioning B.O.D. He can not disown the liability of the offences saying that the said offences were committed by the C.E.O. or the Branch Manager Sanjay Deshpande or for that matter by Directors. There appear several insertions in the Minutes Book of the meetings of the Board of Directors, which could not have been possible except with the active support and participation in crime by the applicant who was the Chairman of the bank; because he was required to sign the confirmation of the minutes of previous meetings along with the Chief Executive Officer. It also appears that the investigation is being still proceeded. 16] On perusal of the audit report submitted by P.W. Ukey though it is not forming part of charge sheet at this stage, it would be seen that the applicant has committed serious irregularities amounting to the offences alleged above. At this stage it impossible to say that the applicant who was chairman of the Board 20 of Directors was so naive and innocent that he would not sense what is being done by the C.E.O. and others. It is necessary to bear in mind that his father was erstwhile chairman of the bank. It appears from the order of the anticipatory bail passed by this court in Criminal Application No. 297/2008 that his anticipatory bail application was rejected. Here is the case where the present applicant was elected director of the bank who continued to be Chairman for quite a long time during which such irregularities and illegalities amounting to offences were committed. It is impossible to come to the conclusion at this stage that he must have been falsely involved in the crime; because allegations against him are supported by the special audit report. 17] It is stated on affidavit by the respondent offences came to be registered against the present applicant and other accused, on the basis of the said audit report. I have extracted the contents of the FIR and the charge sheet to show that how offences allegations against applicant constitute serious economic offences. Ten points referred in the reply are thus: i] The loss caused to the bank due to illegality committed by the Bank in the inward purchase bill account specifically in respect of Amanraj Hemani Group by alleging the bill discount by obtaining less commission. the Cash Credit Misappropriation of ii] Accounts of M/s Amanraj Group and replacing the same by some of the other accounts holders by causing interpolation the Computer data. iii] Rephasement of all loan account of M/s Nawal Harsha Group at the instance of the Chief 21 Violation of Involvement of Executive Officer of the Bank, Branch Manager and Managing Directors of the Bank irrespective of restriction imposed by the Reserve Bank of India. Allotment of loan to 12 Big Groups and iv] 15 Creditors in utter violation of the directives of Reserve Bank of India in respect of the maximum limit fixed by the Reserve Bank of India and without obtaining proper and adequate security. v] rules while selling the property mortgage with the bank at the instance the Chief Executive Officer and Special recovery Officer then Director vi] Narkhede Group in respect of not recovering the amount and grant of loan without obtaining proper and adequate security. vii] amount funds. viii] Irrespective of the restriction imposed by the Reserve Bank of India, the them managing committee and other officials of the bank involved return of themselves in opening accounts, amounts, guidelines issued by Reserve Bank of India. It is noted that the securities obtained were sold at her lesser price, resulting into huge of bank losses to the bank. ix] Compromising various loan cases under the O.T.C. Scheme in utter violation of the rules prescribed for the said purpose. x] to M/s Ashoka Safe Deposit Volts.” Breach of rules while investing the in government securities and mutual Illegalities committed in granting loan thereby acting in derogation of 18] These are not such simple offences of which investigation could have been completed within 3 months. The investigation as 22 stated above is still going on. I am aware that the charge sheet is filed against the present applicant saying that the investigation against him is completed. Prosecution cannot be blamed for filing such charge sheet before competition of 90 days. Had the fact been otherwise it would have received indiction for allowing applicant released for default. But then it is also stated that the investigation against all the accused is being continued and the charge sheet is likely to be filed in near future. In these circumstances, possibility of some more evidence being collected against the applicant cannot be overruled. 19] Here is the case where the money of the depositors have been swindled to large extent and as per prosecution to the tune of Rs.145 crores. Even if for the sake of arguments, it is assumed that it is only of some crores, still the gravity of the offences is not lessened. 20] It needs to be noted that Chairman of the bank owes considerable responsibility in attending the affairs of the society, in the present case; the bank. Depositors and members of the society show their full faith in the office bearers of the bank and the society and therefore, they have to remain vigilant for the affairs of the society and see that no illegalities, irregularities, much less offences are committed during the affairs of said society. Persons like Chairman, in my opinion, can not be allowed to say that the offences were committed by the officers of the said bank or society 23 when almost everything is required to be done by the resolutions of which the Chairman and the concerned directors are having authority to supervise the same. It cannot be said to be mere lapse or negligence in attending duties; if such incidents had occurred frequently and in large numbers. The involvement in conspiracy would be obvious in such cases. Had there been a solitary instance, possibly the contention that there was negligence or bonafide lapse in administration or affairs of the bank could have been accepted, but when there are large numbers of such incidents, it cannot be said to be mere negligence or inadvertence in attending affairs of the bank. It would not be wrong to say that when there are such so called inadvertences which are affecting the life savings of the depositors in such large numbers, they have to be dealt with stern hands, so as to restore faith of public at large in such system. In such cases, it cannot be lost sight of fact that victims of such offences are not even heard. Their interest has to be safeguarded in their absence. They also need to feel that justice is being done in their absence. 21] It can not be permitted to say that this is only a single offence. It is necessary to bear in mind that in such cases, the depositors are not heard, The life time savings are kept in the bank. with a fond hope that they would get return of the same at the appropriate time with some benefit of interest. If they do not get in time to meet their needs, it would be serious offence in respect of each of such depositors & therefore in such case, this cannot be 24 treated as a single offence for the purposes of bail like in other I.P.C. cases. 22] Merely because the trial is not likely to take place in near future and there is no averment of past tampering by the applicant to the evidence, it cannot be said that the applicant would be entitled for bail. It is not necessary that in all cases bail should be granted; may be with stringent conditions and particularly in such cases where public at large, members of the society had reposed faith in the Chairman, nonetheless in the son of the erstwhile Chairman by electing him as a Director and consequently the Chairman of the Board of Directors. It is a serious betrayal. Incarceration of few (5-6) months would not justify release of prime accused on bail in such cases. 23] In my opinion it would have been in the fitness of things for the applicant to bonafide explain everything which had come against him in the audit report and try to recover the amount from concerned creditors and to avoid such lapses when they were discovered and noticed and even informed by the R.B.I. compliances for which the bank was penalized in lack of rupees. But no attempt appears to have been made by him in that regard. No attempt seems to have been made to recover loans. Even when cheques of borrowers were dishonoured still discount facilities were continued. No attempts seems to have been made to get loan applications properly processed by the applicant. No credentials of 25 borrowers were verified by the process laid down bye - laws. In some cases even loan applications were not found. All this would speak against applicant/ Chairman of Bank; as acts are done with impunity and with requisite knowledge and mens rea, prima facie. Some of the offences alleged against applicant are punishable with imprisonment for life. These being factual aspects, the authorities referred by the learned counsel for applicant would not help him. In these circumstances. They are distinguishable on facts. In this view of matter I need not refer to the authorities cited by the learned A.P.P. 24] As such the applicant can not be held entitled for bail at this stage. 25] It is made clear that all these observations are in prima facie view of the matter and therefore, they would not influence the learned trial Judge while deciding the matter on merits. 26] Liberty is also granted to applicant to move for bail after the charge sheet is finally filed against the other accused or after six months which ever is earlier . Application stands rejected. smp. JUDGE