- 1 - NC: 2025:KHC-D:69 CRL.P No. 100439 of 2020 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 6TH DAY OF JANUARY, 2025 BEFORE THE HON'BLE MR. JUSTICE HEMANT CHANDANGOUDAR CRIMINAL PETITION NO. 100439 OF 2020 (482(CR.PC)/528(BNSS)) BETWEEN: 1. K. VEDAVYAS RAO S/O VISHWANATH RAO, A/A: 65 YEARS, RETIRED MANAGER, R/O: “ANUGRAHA”, 3/92, KIRIYUR ROAD, AMBALAPADI, UDUPI. 2. PRAKASH S/O RAGHURAM SHETTY, A/A: 62 YEARS, RETIRED MANAGER OF VIJAYA BANK, R/O: PLOT NO.36, 13TH CROSS, RANI CHENNAMMA NAGAR, DHARWAD. 3. GOUTAM PRAKASH S/O GOPAL PRASAD, A/A: 49 YEARS, ASSISTANT GENERAL MANAGER, BANK OF BARODA (ERSTWHILE VIJAYA BANK), C/O CENTRALIZED TRANSACTION MONITORING UNIT, HEAD OFFICE, 1ST FLOOR, SURAJ PLAZA 1, SAYAJIGANJ, VADODARA, GUJARAT. 4. H. CHANDRASHEKHAR SANJEEV SHETTY, A/A: 62 YEARS, RETIRED MANAGER OF VIJAYA BANK, R/O: RAJATADRI, SHIRUR-576 228,UDUPI DISTRICT. … PETITIONERS (BY SRI. A.P. HEDGE JANMANE AND SRI. VIJAY MALALI, ADVOCATES) ASHPAK KASHIMSA MALAGALADINNI Digitally signed by ASHPAK KASHIMSA MALAGALADINNI Location: HIGH COURT OF KARNATAKA DHARWAD BENCH Date: 2025.01.09 12:51:08 +0530 - 2 - NC: 2025:KHC-D:69 CRL.P No. 100439 of 2020 AND: 1. STATE OF KARNATAKA, REPRESENTED BY POLICE INSPECTOR, MUNDGOD POLICE STATION, MUNDGOD, U.K. DISTRICT. REP. BY S.P.P., HIGH COURT OF KARNATAKA, DHARWAD BENCH. 2. VIRENDRA KUMAR P., AGE: MAJOR, POLICE INSPECTOR, C/O POLICE STATION, MUNDGOD. … RESPONDENTS (BY SRI. ASHOK T. KATTIMANI, AGA) THIS CRIMINAL PETITION IS FILED U/S 482 OF CR.P.C., PRAYING TO CALL FOR THE RECORDS, ALLOW THE PETITION AND SET ASIDE THE ORDER DATED 26/07/2012 SO PASSED BY CIVIL JUDGE AND J.M.F.C., MUNDGOD IN C.C.NO.120/2010 DISMISSING THE APPLICATION FOR DISCHARGE MOVED BY ACCUSED NO.2 TO 5 U/S 239 CR.P.C. AND ORDER DATED 28/09/2017 SO PASSED BY FIRST ADDITIONAL DISTRICT AND SESSIONS JUDGE, UTTARA KANNADA, KARWAR SITTING AT SIRSI DISMISSING THE CRIMINAL REVISION PETITION NO.79/2012 AND CONSEQUENTLY DISCHARGE THE PETITIONERS FROM CC NO.120/2010 PENDING ON THE FILE OF CIVIL JUDGE AND J.M.F.C., MUNDGOD FOR THE OFFENCE P/U/S. 465, 468, 474, 409 AND 420 OF IPC R/W 34 OF IPC IN THE ENDS OF JUSTICE. THIS PETITION IS COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: THE HON'BLE MR. JUSTICE HEMANT CHANDANGOUDAR - 3 - NC: 2025:KHC-D:69 CRL.P No. 100439 of 2020 ORAL ORDER 1. The accused Nos.2 to 5 filed an application under Section 239 of the Criminal Procedure Code (Cr.P.C.) seeking discharge from the offences punishable under Sections 465, 468, 471, 409, and 420 of the Indian Penal Code (IPC). The trial Court rejected the application, and the rejection was upheld by the learned Sessions Judge. Aggrieved by the same, the petitioners are before this Court. 2. The case of the prosecution is that the petitioner/accused No.5 had initially filed a complaint with the jurisdictional Police alleging that certain borrowers, in collusion with accused No.1, who was the approved Gold Appraiser for Vijaya Bank, Katur Branch, had issued a false valuation report. It is alleged that accused No.1 was fully aware that the gold ornaments offered as security for the repayment of loans were fake. Based on the false valuation report, the petitioners, as bank officials, approved loans to the borrowers. 3. After completing the investigation, the Police filed a charge sheet, alleging that the petitioners had connived with - 4 - NC: 2025:KHC-D:69 CRL.P No. 100439 of 2020 accused No.1 and the borrowers in approving loans based on the fake gold ornaments. 4. Learned counsel for the petitioners argued that there is no evidence to substantiate the claim that the petitioners, who were working as Managers at the relevant time, had connived with accused No.1 or the borrowers in issuing the alleged fake valuation report. It was contended that the prosecution of the petitioners, in the absence of corroborative material, would amount to an abuse of the process of law. 5. It was further submitted that Vijaya Bank had filed suits against the borrowers who had fraudulently obtained loans and had also initiated recovery proceedings against accused No.1 and the borrowers. In these proceedings, the trial Court held the borrowers, including accused No.2, jointly and severally liable to repay the loan amount. Therefore, in the absence of any material indicating that the petitioners colluded with accused No.1 or the borrowers, the continuation of criminal proceedings is unwarranted. - 5 - NC: 2025:KHC-D:69 CRL.P No. 100439 of 2020 6. Learned Additional Government Advocate for respondent No.1-State contended that the charge sheet material establishes that the petitioners, as Bank Managers, had connived with accused No.1 and the borrowers in fraudulently approving loans. He argued that the veracity of the allegations can only be determined during the trial, not at this stage, and sought dismissal of the petition. 7. After hearing the submissions of both parties and examining the material on record, the following is noted: (a) The petitioner/accused No.5 had lodged a complaint alleging that accused No.1, the Gold Appraiser, in collusion with the borrowers, issued a valuation report despite knowing that the gold ornaments were fake. (b) However, the Police, during the investigation, implicated the petitioners solely on the basis that they were working as Managers of Vijaya Bank at the relevant time. (c) There is no material to establish that the petitioners, in their capacity as Bank Managers, connived with accused No.1 in issuing the false valuation report. The petitioners - 6 - NC: 2025:KHC-D:69 CRL.P No. 100439 of 2020 merely approved loans based on the valuation report submitted by accused No.1 and were not responsible for verifying the genuineness of the gold ornaments offered as security for the loans. (d) In the absence of corroborative evidence to substantiate the allegations against the petitioners, the continuation of the criminal proceedings would be an abuse of the process of law. 8. In view of the foregoing, the petition is allowed. 9. The impugned order dated 26.07.2012 passed by the Civil Judge and JMFC, Mundgod, in C.C.No.120/2010 on the application filed under Section 239 of the Cr.P.C. and the order dated 28.09.2017 passed by the First Additional District and Sessions Judge, Uttara Kannada, Karwar, sitting at Sirsi in Crl.R.P.No.79/2012 are hereby quashed. 10. The application filed under Section 239 of the Cr.P.C by the petitioners/accused Nos.2 to 5 in C.C.No.120/2010 on the file of the Civil Judge and JMFC, Mundgod, is allowed. - 7 - NC: 2025:KHC-D:69 CRL.P No. 100439 of 2020 Consequently, the petitioners are discharged from the aforesaid offences. Sd/- (HEMANT CHANDANGOUDAR) JUDGE AC CT:BCK LIST NO.: 1 SL NO.: 61