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Tuesday, March 28, 2017

Sections 409, 418, 423 and 425 read with Section 120-B of the IPC - whether Criminal Case No. 0800009/SW/08, pending in the Court of Additional Chief Metropolitan Magistrate, 8th Court, Esplanade, Mumbai, is liable to be quashed or not?= we are of the considered opinion that there was suppression of facts by both the Banks and the State Bank of Travancore was duty bound to inform the respondent-Company about the Assignment dated 29.03.2006. As regards the appellants herein, appellant No.1 herein has claimed to have joined the State Bank of Travancore on 11.05.2006 i.e. subsequent to the assignment deed dated 29.03.2006 whereas appellant No.2 was the signatory to the said deed.There is no denying the fact that both the appellants were responsible for day to day functioning of the State Bank of Travancore. Furthermore, admittedly, appellant No.1 was in employment of the State Bank of Travancore at the time of the execution of the deed of assignment and the appellant No.2 was the signatory to it. On a bare perusal of the complaint, it creates an iota of doubt as to why the respondent-Company was kept in dark by the State Bank of Travancore at the time of alleged Assignment Deed dated 29.03.2006However, from the admitted position, it is evident that the complainant-respondent Company in its wisdom had withdrawn the complaint against the two persons, who were the officers of the Kotak Mahindra Bank Ltd. from a common complaint made against four persons. However, we do not find any reason as to why the remaining two persons, being the present appellants, who were the officers of the State Bank of Travancore at the relevant time, are being prosecuted. Hence, the complaint against the present appellants does not survive and in the interest of justice the same is liable to quashed and is accordingly quashed.

                                      REPORTABLE
                        IN THE SUPREME COURT OF INDIA
                CRIMINAL APPELLATE JURISDICTION

                 CRIMINAL APPEAL NO. 2285 OF 2011



K. Sitaram & Anr.                                  .... Appellant(s)

            Versus

CFL Capital Financial Service Ltd. & Anr.         .... Respondent(s)















                         J U D G M E N T


R.K. Agrawal, J.
1)    This appeal has been  filed  against  the  judgment  and  order  dated
07.01.2011 passed by the High Court of  Judicature  at  Bombay  in  Criminal
Writ Petition No. 1279 of 2010 whereby learned  single  Judge  of  the  High
Court dismissed the writ petition filed by the appellants herein.
2)    Brief facts:
(a)   The complainant-respondent Company borrowed a sum  of  Rs.  900  lakhs
comprising Rs. 180 lakhs through cash credits from the consortium  of  Banks
(of which the State Bank of Travancore was the lead bank) and a sum  of  Rs.
720 lakhs being working capital demand Loan.   Due  to  non-payment  of  the
loan amount, the account became Non-Performing Asset.  In order  to  recover
the amount against the borrower, the State Bank of Travancore filed  OA  No.
96 of 2003 before the Debts Recovery Tribunal (DRT), Mumbai. On  22.07.2005,
the DRT passed a partial decree awarding a sum of Rs. 812.26 lakhs  with  12
per cent interest.
(b)   On 29.03.2006, the State Bank of Travancore  assigned  the  debts  due
from the complainant-Company to the Kotak Mahindra Bank  together  with  all
the securities through an Assignment Deed.  On 11.01.2007, the  borrower-the
respondent Company assigned to Kotak Mahindra Bank the debt due  towards  it
from one Ravishankar Industries Pvt. Ltd. of more than Rs.  32  crores  with
an agreement that any excess recovery over  and  above  Rs.  90  lakhs  from
Ravishankar Industries Pvt. Ltd. would be shared equally between  the  Kotak
Mahindra Bank and the complainant-Company. It is pertinent to  mention  here
that the fact of the alleged Assignment Deed  came  to  the  notice  of  the
complainant-Company only on 17.01.2007 when the Kotak Mahindra  Bank  handed
over a copy of the application  for  substituting  themselves  in  place  of
State Bank of Travancore to the respondent-Company.
(c)   The Kotak Mahindra Bank initiated process for  substituting  its  name
in  place  of  the  assignor-State  Bank  of  Travancore  in  the   recovery
application  and  also  withdraws  two  criminal  complaints  filed  by  the
respondent-Company against Ravishankar  Industries  Pvt.  Ltd.  without  any
information to the respondent-Company.  On 28.04.2007,  the  Kotak  Mahindra
Bank moved an application before the Recovery  Officer-I  for  appropriating
Rs. 67.5 lakhs due towards the complainant-Company, being  50  per  cent  of
the amount of Rs. 135 lakhs received in excess of  Rs.  90  lakhs  from  the
Ravishankar Industries Pvt. Ltd., against the claim towards the  State  Bank
of Travancore.
(d)  On 16.05.2007, the complainant-respondent  Company  filed  a  complaint
against the Kotak Mahindra Bank and its officers being No.  18/SW/07  before
the Metropolitan Magistrate, Bandra, Mumbai under Sections  409,  418,  read
with 120-B of the  Indian  Penal  Code,  1860  (in  short  ‘the  IPC’).   On
25.06.2007, the Additional Chief  Metropolitan  Magistrate,  Bandra,  Mumbai
issued process against all the accused in the  complaint  dated  16.05.2007.
The accused therein preferred  Criminal  Revision  Applications  being  Nos.
1024-1026 of 2007 before the Court of Sessions for Greater Bombay.   Learned
Additional Sessions Judge,  vide  order  dated  03/05.04.2008,  allowed  the
revision applications while setting aside the  order  of  issue  of  process
dated 25.06.2007.
(e)    A  fresh  complaint  being  No.  0800009/SW/08  was  filed   by   the
complainant-the respondent Company before the Additional Chief  Metropolitan
Magistrate, 8th Court, Esplanade, Mumbai under Sections 409,  418,  423  and
425  read  with  Section  120-B  of  the  IPC  against  the  State  Bank  of
Travancore, Kotak Mahindra Bank Limited and its officers.  The  Metropolitan
Magistrate, I/C  ACMM,  8th  Court,  Esplanade,  Mumbai,  vide  order  dated
25.01.2008, issued process  against  the  officers  of  the  State  Bank  of
Travancore  and  Kotak  Mahindra  Bank  Limited.   On  11.05.2008,   learned
Magistrate excluded the officers of the Kotak Mahindra Bank Limited in  view
of an application filed by the respondent-Company to withdraw the  complaint
against them.
(f)   Being aggrieved, the  appellants  herein  preferred  a  Criminal  Writ
Petition being No. 1279 of  2010  before  the  High  Court.  On  07.01.2011,
learned single Judge of the High Court, dismissed the  writ  petition  filed
by the appellants herein for setting aside the order of issue of process  by
learned Magistrate dated 25.01.2008 against the appellants.
(g)    Aggrieved  by  the  order  dated  07.01.2011,  the  appellants   have
preferred this appeal by way of special leave.
3)    Heard the arguments advanced by Mr. T.R. Andhyarujina, learned  senior
counsel for the appellants and Mr. Aniruddha P. Mayee, learned  counsel  for
the State and perused the records.
Point for consideration:
4)    The  only  point  for  consideration  before  this  Court  is  whether
Criminal Case No. 0800009/SW/08, pending in the Court  of  Additional  Chief
Metropolitan Magistrate, 8th Court,  Esplanade,  Mumbai,  is  liable  to  be
quashed or not?
Rival contentions:
5)    Learned senior counsel for the appellants  vehemently  contended  that
the appellants were not the employees of the State Bank of  Travancore  when
the alleged Deed of Assignment was entered into between the  State  Bank  of
Travancore and the Kotak Mahindra Bank.  He further contended that the  Deed
of Assignment dated 29.03.2006 is a valid  and  equitable  assignment.   The
decision in  respect  of  execution  of  the  assignment  is  taken  by  the
Executive Committee of the State Bank of Travancore and the same is not  the
individual decision  of  the  appellants  herein.   Learned  senior  counsel
further contended that since the State Bank of Travancore had  no  knowledge
about  the  transactions  between  the  respondent-Company  and  the   Kotak
Mahindra Bank, the State Bank of Travancore  cannot  be  said  to  have  any
intention to defraud anyone.  There is no wrongful gain  to  the  appellants
or the State Bank of Travancore  and  the  accusation  that  they  acted  in
collusion and connivance with the officers of the  Kotak  Mahindra  Bank  to
commit the criminal  breach  of  trust,  cheating  and  dishonest/fraudulent
execution of deeds of transfer is baseless.  He further  submitted  that  as
the complainant-respondent Company had withdrawn the complaint  against  the
co-accused, i.e.,  the  officers  of  the  Kotak  Mahindra  Bank  Ltd.,  the
complaint made against the appellants herein cannot proceed  and  is  liable
to  be  quashed  as  the  allegations  against  them  are  also  same.   The
complainant-respondent Company cannot be allowed to blow  hot  and  cold  in
the  same  breath.   Learned  senior  counsel  for  the  appellants  finally
contended that the appellants are in no way related to the said  transaction
and the complaint also has not specifically  set  out  any  offence  against
them.
6)    On the other hand, learned counsel for the State  submitted  that  the
appellant No. 1 herein was the  Managing  Director  of  the  State  Bank  of
Travancore at the relevant time and was responsible  for  the  business  and
day to day affairs of the Bank.  Similarly, appellant No. 2 herein  was  the
Deputy General Manager and Principal Officer, who  had  signed  the  alleged
Assignment Deed dated 29.03.2006 on behalf of the State Bank of  Travancore.
He further submitted that in such a scenario, the appellants  herein,  being
the principal perpetrators, actively connived and colluded  with  the  Kotak
Mahindra Bank and its officers  with  a  common  intention  to  deceive  the
respondent-Company  in  order  to  make  wrongful  gains.   Learned  counsel
further submitted that the active collusion and conspiracy between both  the
Banks hatched together deliberately with a view to deceive  the  respondent-
Company is also evident from the fact that in the  alleged  assignment  deed
dated 29.03.2006, there was  a  clear  undertaking  under  Clause  2.3  that
simultaneously with the execution of  the  said  deed,  the  State  Bank  of
Travancore must send a notice addressed  to  the  respondent-Company  herein
informing it of the assignment  of  the  alleged  debts  and  the  financial
instruments to the Kotak Mahindra Bank.
7)    Learned counsel for the State further submitted that  the  State  Bank
of Travancore was duty bound to protect  the  interest  of  the  respondent-
Company as the Bank was entrusted with certain properties of the respondent-
Company.   By  entering  into  such  alleged  assignment   with   deliberate
suppression and concealment of material facts with dishonest intention,  the
appellants herein, who were responsible for the day to day  affairs  of  the
Bank, have committed the offence of criminal breach of trust  and  cheating.
Learned counsel for  the  State  finally  submitted  that  the  order  dated
25.01.2008 passed by the Metropolitan Magistrate for  issue  of  process  as
well as the order dated 07.01.2011, passed by the learned  single  Judge  of
the High Court, dismissing the writ petition filed by the appellants  herein
for setting aside the order of issue of  process  dated  25.01.2008  against
the appellants are justified and do not call for any interference.
Discussion:
8)    The present appeal has been filed for quashing of  Criminal  Case  No.
0800009/SW/08  pending  in  the  Court  of  Additional  Chief   Metropolitan
Magistrate, 8th Court, Esplanade, Mumbai and for  setting  aside  the  order
dated 25th January 2008,  by  which  process  was  issued  against  all  the
persons accused in the complaint.  Appellant No. 1  herein  was  working  as
Managing Director with the State Bank of Travancore during the  period  11th
May 2006 to 30th June 2007.  Appellant No. 2 herein worked with the Bank  as
the Deputy General Manager during the period from January 2005  to  November
2006.
9)    The respondent-Company filed a complaint alleging  offence  punishable
under Sections 409, 418, 423 and 425 read with  Section  120-B  of  the  IPC
against the appellants herein.  The Bank had  in  December  1995  sanctioned
loan of Rs. 180 lakhs by way of cash credit facility and Rs.  720  lakhs  by
way of working capital demand loan, totaling to  Rs.  900/-  lakhs  and  the
complainant-Company executed various documents in favour of  the  Bank.   As
the respondent-Company was unable to pay its dues to the Bank, the Bank  had
filed recovery proceedings before the Tribunal wherein a partial decree  for
a sum of Rs.812.26 lakhs had been passed.
10)   In  the  said  proceedings,  Kotak  Mahindra  Bank  Limited  filed  an
application for substituting its name in place of State Bank  of  Travancore
claiming all the dues and charge on the immovable  properties  mortgaged  in
favour  of  State  Bank  of  Travancore  vide  an  Assignment   Deed   dated
29.03.2006.  The respondent-Company claimed that no notice  of  the  alleged
assignment dated 29.03.2006 had  been  given  to  it.   On  11.01.2007,  the
respondent–Company  entered  into  a  Deed  of  Assignment  with  the  Kotak
Mahindra Bank Limited, wherein all the dues of Ravishankar  Industries  Pvt.
Ltd. of more than Rs. 32 crores were assigned to the  Kotak  Mahindra  Bank.
Under the agreement, it was agreed that any amount received over  and  above
Rs.  90  lakhs  from  the  Company  would  be  shared  equally  between  the
respondent–Company  and  Kotak  Mahindra  Bank.   The  Kotak  Mahindra  Bank
withdrew the proceedings filed by the respondent–Company under  Section  138
of the Negotiable Instruments Act against the  Ravishankar  Industries  Pvt.
Ltd and also  settled  an  amount  of  Rs.  225  lakhs  without  giving  any
information to it as to the terms of settlement and  the  mode  of  payment.
It is the  allegation  of  the  complainant  that  if  the  complainant  was
informed about the alleged Assignment Deed dated 29.03.2006,  it  would  not
have entered into the assignment agreement  on  11.01.2007  with  the  Kotak
Mahindra  Bank.  It  is  alleged  that  the   suppression   of   facts   and
surreptitious execution of the  deed  of  assignment  dated  29.03.2006  was
deliberately done with a dishonest  intention  to  induce  the  complainant-
Company and to make wrongful losses and to deceive it.
11)    Learned  senior  counsel  for  the  appellants  contended  that   the
allegations against the appellants in their  personal  capacity  are  vague.
He further contended that Appellant No. 1 herein joined the  State  Bank  of
Travancore on 11.05.2006  i.e.  subsequent  to  the  Assignment  Deed  dated
29.03.2006.   He  was,  however,  admittedly  working  with  the   Bank   on
11.01.2007,  when  the  complainant  Company  entered  into  the   Deed   of
Assignment with the  Kotak  Mahindra  Bank.   As  regards  Appellant  No.  2
herein, though he was signatory to the Deed of Assignment dated  29.03.2006,
he submitted that he was not in service of State Bank of Travancore  on  the
date on which Deed of Assignment dated 11.01.2007, was executed between  the
complainant-Company and the Kotak Mahindra Bank and hence he claims to  have
no connection whatsoever with the offence  alleged.   He  further  contended
that the  IPC  does  not  contain  any  provision  for  attaching  vicarious
liability on the part of the Chairman and General Managers  of  the  Company
when the accused  is  the  Company.   When  the  Company  is  the  offender,
vicarious liability of the directors cannot  be  imputed  automatically,  in
the absence of any statutory provisions to this effect.
12)   In support of his claim, learned  senior  counsel  for  the  appellant
cited a decision of this Court in Maksud Saiyed vs.  State  of  Gujarat  and
Others (2008) 5 SCC 668 wherein it was held as under:-
      “13. Where a jurisdiction is exercised on a complaint  petition  filed
      in terms of Section 156(3) or Section 200  of  the  Code  of  Criminal
      Procedure, the Magistrate is required to apply  his  mind.  The  Penal
      Code does not contain any provision for attaching vicarious  liability
      on the part of the Managing Director or the Directors of  the  Company
      when the accused is the Company. The learned Magistrate failed to pose
      unto himself the correct question viz. as  to  whether  the  complaint
      petition, even if given face value and taken  to  be  correct  in  its
      entirety, would lead to the conclusion  that  the  respondents  herein
      were personally liable for any offence. The Bank is a body  corporate.
      Vicarious liability of the Managing Director and Director would  arise
      provided any provision exists in that behalf in the statute.  Statutes
      indisputably must contain provision fixing such vicarious liabilities.
      Even for the said purpose,  it  is  obligatory  on  the  part  of  the
      complainant to make requisite  allegations  which  would  attract  the
      provisions constituting vicarious liability.”

13)   In support of his claim that the transactions between the  complainant
and the State Bank of Travancore were purely civil in  nature  and  criminal
court has nothing to do with it, learned senior counsel for  the  appellants
further relied upon a decision of this Court  in  Sardar  Trilok  Singh  and
Others vs. Satya Deo Tripathi (1979) 4  SCC  396  wherein  it  was  held  as
under:-

   “5…..The question as to what were the terms of the settlement and whether
   they were duly incorporated in the printed  agreement  or  not  were  all
   questions which could be properly  and  adequately  decided  in  a  civil
   court. Obtaining signature of a person on blank sheet of papers by itself
   is not an offence of forgery or the like. It becomes an offence when  the
   paper is fabricated into a  document  of  the  kind  which  attracts  the
   relevant provisions of the Penal Code making it an offence or when such a
   document is used as a genuine document. Even assuming that the appellants
   either by themselves or in the Company of some others went and seized the
   truck on July 30, 1973 from the house of the respondent  they  could  and
   did claim to have done so in exercise of their bona fide right of seizing
   the  truck  on  the  respondent’s  failure  to  pay  the  third   monthly
   installment in time. It was, therefore, a bona fide civil  dispute  which
   led to the seizure of the truck. On the face of  the  complaint  petition
   itself the highly  exaggerated  version  given  by  the  respondent,  the
   appellants went to his house with a mob armed  with  deadly  weapons  and
   committed the offence of dacoity in taking away the  truck  was  so  very
   unnatural and untrustworthy that it could take  the  matter  out  of  the
   realm of civil dispute. Nobody on the side of the  respondent  was  hurt.
   Even a scratch was not given to anybody.
      6. In our opinion on the facts and in the circumstances of  this  case
   criminal prosecution deserves to be quashed. On behalf of the  respondent
   it was argued that the appellants’ filing a petition in  the  High  Court
   for quashing the proceeding before issuance of the summons was  premature
   and the High Court could not have quashed it. In our opinion the point is
   so wholly without  substance  that  it  has  been  stated  merely  to  be
   rejected. Since the parties during the course  of  the  hearing  in  this
   appeal showed their inclination to settle up and end all  their  disputes
   and quarrels in relation to the matter in question after we indicated our
   view that we are going to allow the appeal and quash the proceedings,  we
   have not thought it  necessary  to  elaborately  give  other  reasons  in
   support of our order”.


14)   Learned senior counsel for the appellants further  relied  upon  Sunil
Bharti Mittal vs.  Central  Bureau  of  Investigation  2015  (1)  SCALE  140
wherein it was held that a corporate entity is an  artificial  person  which
acts through its officers, directors, managing director, chairman  etc.   If
such a Company commits an offence involving mens rea, it would  normally  be
the intent and action of that individual who would  act  on  behalf  of  the
Company.  It would be more so, when the criminal act is that of  conspiracy.
 However, at  the  same  time,  it  is  a  cardinal  principle  of  criminal
jurisprudence that there  is  no  vicarious  liability  unless  the  statute
specifically provides so.
15)   As the appellants herein have challenged the legality of the order  of
issue of process, it would be worthwhile to recapitulate the  law  regarding
issue of process.  The relevant point that arises for consideration at  this
stage is whether the material available is sufficient enough  to  constitute
a prima facie case against the accused.

16)   When a person files a complaint and supports  it  on  oath,  rendering
himself liable to prosecution  and  imprisonment  if  it  is  false,  he  is
entitled  to  be  believed  unless  there  is  some  apparent   reason   for
disbelieving him; and he is entitled to have the persons,  against  whom  he
complains,  brought  before  the  court  and  tried.   The  only   condition
requisite for the issue of process  is  that  the  complainant’s  deposition
must show some sufficient ground for proceeding.  Unless the  Magistrate  is
satisfied that there is sufficient ground for proceeding with the  complaint
or sufficient material to justify the issue of process, he should  not  pass
the order of issue of process.  Where the complainant,  who  instituted  the
prosecution, has no personal  knowledge  of  the  allegations  made  in  the
complaint, the magistrate should satisfy himself upon proper materials  that
a case is made out for the issue of process.  Though under the law,  a  wide
discretion is given to magistrate  with  respect  to  grant  or  refusal  of
process, however, this discretion should be exercised with proper  care  and
caution.

17)   The respondent-Company came to know about the  Assignment  Deed  dated
29.03.2006 only  on  17.01.2007  when  the  Kotak  Mahindra  Bank  moved  an
application  for  substituting  themselves  in  place  of  State   Bank   of
Travancore on the basis of that alleged document i.e. Assignment Deed  dated
29.03.2006.  It is also pertinent to mention here  that  neither  the  State
Bank of Travancore nor the Kotak  Mahindra  Bank  informed  the  respondent-
Company regarding the alleged Assignment Deed either  before  or  after  the
alleged assignment.   It  is  also  on  record  that  vide  agreement  dated
01.10.1999, the Kotak Mahindra Bank, which was earlier a financial  services
Company, entered into an agreement with the respondent-Company to act as  an
advisor  and  to   provide   necessary   assistance   for   the   successful
restructuring of  the  respondent-Company  and  to  provide  follow  up  and
support services to the complainant-Company in  recovery  from  its  various
defaulters.
18)   Under the above terms and conditions, when  the  Kotak  Mahindra  Bank
was already  in  an  agreement  with  the  respondent-Company  in  order  to
safeguard its interest, the fact of the Assignment Deed  between  the  State
Bank of Travancore and the  Kotal  Mahindra  Bank  with  regard  to  alleged
rights  of  the  State  Bank  of  Travancore  pertaining  to  the  immovable
properties allegedly mortgaged in its favour, must be  communicated  by  the
State Bank of Travancore to the respondent-Company. More  so,  the  fact  of
such assignment deed must also  be  brought  to  the  notice  by  the  Kotak
Mahindra Bank to the respondent-Company when it was responsible  to  provide
necessary assistance to the respondent-Company.
19)   In view of the above, it is pertinent to mention here  Clause  2.3  of
the Assignment Deed dated 29.03.2006, which reads as under:
      “Simultaneously with the execution of this Deed,  the  Assignor  shall
      send a notice addressed by the  Assignor  to  the  clients  and  other
      related persons at their last known addresses informing  them  of  the
      assignments of Debts and the Financial Instruments to the Assignee and
      instructing them to pay all amounts  constituting  the  Debts  to  the
      Assignee and a copy of the said  notice  shall  be  delivered  to  the
      Assignee.”

      It is very much clear from the above that the  Assignment  Deed  dated
29.03.2006 specifically contains one clause which requires that the  clients
and other related persons shall be informed about  the  alleged  Assignment.
But this fact was not brought  to  the  notice  of  the  respondent-Company.
Primarily, it was the duty of the State Bank of  Travancore  to  inform  the
respondent-Company about the said assignment and  secondly,  Kotak  Mahindra
Bank was to inform the same to the respondent-Company.  If the intention  of
the Assignor and the assignee to the Assignment Deed  dated  29.03.2006  was
clear, then why the facts of the same were not  brought  to  the  notice  of
respondent-Company that too when Clause 2.3  of  the  Assignment  Deed  very
clearly states so.
20)   The position becomes more clear from the  fact  that  even  after  the
alleged assignment, in a proceeding before the appellate tribunal,  none  of
the representative of the State  Bank  of  Travancore  mentioned  about  the
factum of such assignment.  The respondent-Company came to  know  about  the
alleged Assignment after a lapse of 9 months i.e.  on  17.01.2007,  when  an
application was moved by the Kotak Mahindra Bank for substituting  its  name
in place of State Bank of Travancore.  In the absence of such knowledge,  on
11.01.2007, the respondent-Company entered into a deed  of  Assignment  with
the Kotak  Mahindra  Bank  wherein  all  the  dues  of  a  defaulter,  viz.,
Ravishankar Industries Pvt. Ltd., of more than Rs. 32 crores  were  assigned
to the Kotak Mahindra Bank. The Kotak Mahindra Bank was under an  obligation
to inform the respondent-Company about the  earlier  Assignment  Deed  which
was not done.  More so, the Kotak Mahindra Bank received a sum  of  Rs.  225
lakhs in March 2007  from  Ravishankar  Industries  Pvt.  Ltd.  but  without
giving any information as to  the  terms  of  settlement  and  the  mode  of
payment to the complainant-Company, approached the  Recovery  Officer-I  for
appropriating the same.
21)   With regard to the  contention  of  learned  senior  counsel  for  the
appellants herein that there can be no  vicarious  liability  attributed  to
the Director, Deputy Director of a Company unless the  Statute  specifically
creates so, no doubt, a corporate entity is an artificial person which  acts
through its officers, Directors, Managing Director, Chairman, etc.  If  such
a company commits an offence involving mens rea, it would  normally  be  the
intent and action of that individual who would act on behalf of the  company
that too when the criminal act is that of conspiracy.  Thus,  an  individual
who has perpetrated the commission of an offence on behalf  of  the  company
can be made an accused, along with  the  company,  if  there  is  sufficient
evidence of his active role coupled with criminal intent.  Second  situation
in which an individual can  be  implicated  is  in  those  cases  where  the
statutory regime itself attracts the doctrine  of  vicarious  liability,  by
specifically invoking such a provision.
22)   In view of the above, we are of the considered opinion that there  was
suppression of facts by both the Banks and the State Bank of Travancore  was
duty bound to inform  the  respondent-Company  about  the  Assignment  dated
29.03.2006.  As regards the appellants herein,  appellant  No.1  herein  has
claimed to have joined the State  Bank  of  Travancore  on  11.05.2006  i.e.
subsequent to the assignment deed dated 29.03.2006  whereas  appellant  No.2
was the signatory to the said deed.
23)    There  is  no  denying  the  fact  that  both  the  appellants   were
responsible for day to day functioning of  the  State  Bank  of  Travancore.
Furthermore, admittedly, appellant No.1 was in employment of the State  Bank
of Travancore at the time of the execution of the  deed  of  assignment  and
the appellant No.2 was the signatory  to  it.  On  a  bare  perusal  of  the
complaint, it creates an iota of doubt as to why the respondent-Company  was
kept in dark by the  State  Bank  of  Travancore  at  the  time  of  alleged
Assignment Deed dated 29.03.2006
24)    However,  from  the  admitted  position,  it  is  evident  that   the
complainant-respondent Company in its wisdom  had  withdrawn  the  complaint
against the two persons, who were the officers of the  Kotak  Mahindra  Bank
Ltd. from a common complaint made against four persons. However, we  do  not
find any reason as to why the  remaining  two  persons,  being  the  present
appellants, who were the officers of the State Bank  of  Travancore  at  the
relevant time, are  being  prosecuted.  Hence,  the  complaint  against  the
present appellants does not survive and in the interest of justice the  same
is liable to quashed and is accordingly quashed.


25)   In view of the above discussion, the appeal succeeds and  is  allowed.
However, there shall be no order as to costs.





                            ………….………………………J.


                                 (R.K. AGRAWAL)








                            .…....……..………………………………J.


                             (ADARSH KUMAR GOEL)


NEW DELHI;
MARCH 21, 2017.

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