STATE OF MADHYA PRADESH versus YOGENDRA SINGH JADON & ANR.

[2020] 5 S.C.R.

STATE OF MADHYA PRADESH

YOGENDRA SINGH JADON & ANR.

(Criminal Appeal No. 175 of 2020)

BJANUARY 31, 2020

[L. NAGESWARA RAO AND HEMANT GUPTA, JJ.]

Code of Criminal Procedure, 1973:

s. 482 – Charge-sheet u/s. 420 r/w. 120-B IPC – AgainstCfather of the respondents – Alleging inter alia that the accused hadgranted cash credit to the respondents (his sons) without properdocuments, when he was President of the Bank – High Courtquashed the criminal proceedings qua the respondents holding thatno criminal case made out against them – Appeal to Supreme Court– Held: The facts of the case prima facie disclose an offence u/ss.D420 and 120-B IPC against the respondents – High Court was notright in quashing the charges against the respondents.

s. 482 – Jurisdiction under – Scope of – Held: Power u/s.482 cannot be exercised where the allegations are required to beproved in the Court of law.E

Allowing the appeal, the Court

HELD: The High Court examined the entire issue as towhether the offence under Sections 420 and 120-B IPC is madeout or not at pre-trial stage. The respondents are beneficiaryFof the grant of cash credit limit when their father was thePresident of the Bank. The power under Section 482 of theCode of Criminal Procedure, 1973 cannot be exercised wherethe allegations are required to be proved in court of law. Themanner in which loan was advanced without any properdocuments and the fact that the respondents are beneficiary ofGbenevolence of their father prima facie disclose an offence underSections 420 and 120-B IPC. Other officials of the Bank havebeen charge-sheeted for an offence under Sections 13(1)(d) and13(2) of the Prevention of Corruption Act, 1988. The chargeunder Section 420 IPC is not an isolated offence but it has toHbe read along with the offences under the Act to which the

respondents may be liable with the aid of Section 120-B of IPC.Therefore, the order of the High Court quashing the chargesagainst the respondents is not sustainable in law. [Para 5 and 6][73-C-F]

CRIMINAL APPELLATE JURISDICTION : Criminal AppealNo. 175 of 2020.

From the Judgment and Order dated 04.05.2016 of the HighCourt of Madhya Pradesh, Bench at Indore in Criminal Revision No.260 of 2014.

Dhruv Tamta, Ms. Tanvi Bhatnagar, Harsh Parashar, Advs. forthe Appellant.

Arvind Varma, Sr. Adv., Ms. Saloni Tangri, Ms. Jasleen Chahal,Farrukh Rasheed, Advs. for the Respondents.

The Judgment of the Court was delivered by

HEMANT GUPTA, J.

1. The State is aggrievedagainst an order passed by the HighCourt of Madhya Pradesh on 2[nd] May, 2016 whereby the proceedingsagainst the respondents, both sons of late Manohar Singh Jadon, foran offence under Sections 420, 120-B of the Indian Penal Code, 1860[1]were quashed.

2. charge sheet for the offences under Sections 420, 406, 409,120B IPC and 13(1)(d) and 13(2) of the Prevention of Corruption Act,1988[2] was filed on 9[th] July, 2008 consequent to registration of FIRNo. 3 of 2007 on 23[rd] June, 2007. The allegation was that ManoharSingh Jadon, deceased father of the respondents in connivance withother employees of District Cooperative Kendriya Bank Maryadit,Shajapur[3] committed financial irregularities on the basis of forgeddocuments by misusing his post and by providing fake loan to therelatives. Manohar Singh Jadon was President of the Bank from 5[th]February, 1997 to 26[th] March, 2002 and from 27[th] March, 2002 to 7[th]May, 2004. Harshvardhan Singh Jadon (accused-respondent No. 2) isthe proprietor of M/s. Harshvardhan & Brothers whereas Yogendra

1 for short, ‘IPC’

2 for short, ‘Act’

3 for short, ‘Bank’

ASingh (accused-respondent No. 1) is the proprietor of M/s. SaroharTrading Company. Ghanshyam Sharma, General Manager, RamanlalAcharya, Manager, Ram Singh Yadav, General Manager were alsoarrayed as accused. It was alleged that accused Harshvardhan SinghJadon submitted an application on 2[nd] November, 2000 for grant of cashcredit limit of Rs.25 lakhs and that the cash credit limit was sanctionedBwithout following the due procedure. It was also alleged that mortgagedeed was not registered nor signature of original loanee was found onthe mortgage paper. It is also pointed out that an amount ofRs.59,88,327/- was balance on 1[st] December, 2001 even after depositingRs.25 lakhs and that the President has done the renewal of cash creditClimit at his own level and its confirmation was got done later on fromthe loan Sub-Committee, while the case was of the son of the Presidentalone. In respect of Yogendra Singh, again the allegation is that cashcredit limit of Rs.25 lakhs was sanctioned on the basis of his applicationdated 30[th] July, 2001 without completing any of the proceduralrequirements and without mortgage of any of the property. Smt. SarojDSingh mortgaged the land but without any valuation. The surety ofIshwar Singh was taken. The same person mortgaged land as in thecase of Harshvardhan. Similar is the assertion in respect of registrationof mortgage. It was also alleged that sum of Rs.25,65,894/- is thebalance as on 31[st] March, 2002 even after withdrawal beyond theEapproved credit limit of Rs.25 lakhs.

3. The Special Judge passed an order of framing of chargesagainst Harshvardhan Singh Jadon and Yogendra Singh Jadon apartfrom other accused on 24[th] February, 2014. Such order was challengedby the respondents by way of criminal revision.F

4. The High Court in the Revision Petition found that the offencesunder Sections 420 and 120-B IPC are not made out against therespondents. The Court held that there is no assertion that the cashcredit facility obtained with knowledge that they will not repay theloan amount. The Court held as under:G“12. It may be that the Officers of the Bank, because of thefact that father of the applicants was President of the Bank, hadacted in disregard of the relevant rules and regulations in thatbehalf of confer benefit upon the applicants, but that will giverise to liability against the officers of the bank who failed toHdischarge their duties in accordance with prescribed norms and

regulations. However, that may not be ground to proceedagainst person who has been granted cash credit facility.

xxxxxx

14. In the instant case, the uncontroverted allegations taken intheir entirety do not prima facie establish that the applicantsdeceived the Bank Authorities or fraudulently or dishonestlyinduced them to sanction cash credit facility. Thus, the basicingredient to constitute the offence of 420 of IPC is totally missingin the chargesheet.”

5. We find that the High Court has examined the entire issue asto whether the offence under Sections 420 and 120-B is made out ornot at pre trial stage. The respondents are beneficiary of the grant ofcash credit limit when their father was the President of the Bank. Thepower under Section 482 of the Code of Criminal Procedure, 1973cannot be exercised where the allegations are required to be proved incourt of law. The manner in which loan was advanced without anyproper documents and the fact that the respondents are beneficiary ofbenevolence of their father prima facie disclose an offence underSections 420 and 120-B IPC. It may be stated that other officials ofthe Bank have been charge sheeted for an offence under Sections13(1)(d) and 13(2) of the Act. The charge under Section 420 IPC isnot an isolated offence but it has to be read along with the offencesunder the Act to which the respondents may be liable with the aid ofSection 120-B of IPC.