APHC010651322023 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3396] FRIDAY,THE TWENTY EIGHTH DAY OF NOVEMBER TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE DR JUSTICE VENKATA JYOTHIRMAI PRATAPA CRIMINAL PETITION NO: 10069/2023 Between: 1. SHRI AKODI KANAKESWARUDU, S/O (LATE) VYASAMURTHY, AGED 46 YRS OCC SR MANAGER IN CANARA BANK, KAKINADA BRANCH R/AT D.NO. 18-92-7, MANTHAVARI ST, MAHARANIPETA VISAKHAPATNAM-5300002 ...PETITIONER/ACCUSED AND 1. THE STATE OF ANDHRA PRADESH, THROUGH THE DEPUTY SUPERINTENDENT OF POLICE CRIME INVESTIGATION DEPARTMENT (CID) REGIONAL OFFICE, VISAKHAPATNAM REP., BY PUBLIC PROSECUTOR HIGH COURT AT AMARAVATHI 2. SRI AMBATI RAMESH BABU, S/O NAGESWARA RAO, AGED 58 YRS ,ASSISTANT GENERAL MANAGER, CANARA BANK, REGIONAL OFFICE VISAKHAPATNAM. ...RESPONDENT/COMPLAINANT(S): Petition under Section 437/438/439/482 of Cr.P.C and 528 of BNSS praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Courtpleased to pass and order to Quash the Impugned Proceedings in CC.No. 2168/2022 on the file of Chief 2 VJP, J CRLP_10069 _2023 Metropolitan Magistrate Court at Visakhapatnam as against the petitioner/A-7 by Allowing the Criminal Petition in the interest of the justice IA NO: 1 OF 2023 Petition under Section 482 of Cr.P.C and 528 of BNSS praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition,the High Court may be pleased pleased to dispense with filing of the original certified copy of the file of Chief Met., MagistrateC.C.No.2168/2022, dated Court at Visakhapatnam. before this Hon'ble Court and pass IA NO: 2 OF 2023 Petition under Section 482 of Cr.P.C and 528 of BNSS praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition,the High Court may be pleased pleased to pas an order to STAY of all the further proceedings in CC .No. 2168/2022 on the file of chief Metropolitan Magistrate Court at Visakhapatnam as against the petitioner A-7 including for Appearance pending disposal of the main Criminal Petition in the interest of the justice. Counsel for the Petitioner/accused: 1. M SURYA KUMAR Counsel for the Respondent/complainant(S): 1. SPL.PUBLIC PROSECUTOR FOR CID 2. SREEDHAR VALIVETI The Court made the following 3 VJP, J CRLP_10069 _2023 ORDER: The present Criminal Petition is filed under Section 482 of the Code of Criminal Procedure (for short “Cr.P.C.”) seeking to quash the proceedings initiated against the petitioner/A.7 in C.C.No.2168 of 2022 on the file of Court of Chief Metropolitan Magistrate, Visakhapatnam, for the offences punishable under Sections 420, 403, 406, 468, 471 and Section 120-B of the Indian Penal Code. 2. The petitioner herein is A.7 in the alleged crime. Case of the petitioner, as per the charge sheet filed by the CID, in nutshell, is that A-1 is a registered partnership firm in the name and style “M/s. Simhari Civil Technologies, Dondaparthy, Visakhapatnam” and carrying on business in the activity of Interior Designers and Contractors, Construction of Apartments etc. A-2 and A-3 are the partners of A-1 firm. On 19.03.2009 A.2 and A.3 being the partners and proprietors of A-1 firm, availed Open Cash Credit facility under CANTRADE Scheme at Canara Bank, Dwarakanagar Branch, Visakhapatnam, vide account No.2424285000004 to a tune of Rs.8.00 lakhs as Open Cash Credit and Bank Guarantee for Rs.2.00 lakhs, by mortgaging of property to the extent of 10 square yards as collateral security, which is situated at Shop No.3, S.No.651 and 653 in Kalyani Estates, Dondaparthy, Visakhapatnam, for carrying out their business through the A-1 firm. 4 VJP, J CRLP_10069 _2023 Subsequently, A.2 and A.3 gradually enhanced the credit facility limit up to Rs.17.00 lakhs by continuing the mortgage of the said property. On 24.05.2016, A.2 and A.3 submitted a proposal for loan along with sale deed in respect of residential property Flat No.501, Hanuman Towers, situated at Plot No.28 and 29 of Krishnarajapuram layout, Vizianagaram; 2) statement of Encumbrance on property; valuation report and other documents etc., to one Kedarisetty Venkata Ramana, the then Branch Manager, Canara Bank, Dwarakanagar Branch, Visakhapatnam, who is arrayed as A.6, for enhancement of existed credit facility limit. On the same day, A.6 enhanced the credit facility up to Rs.27.00 lakhs vide sanction memorandum dated 24.05.2016. 3. It is alleged that on 09.03.2007 A.3 purchased a residential flat, which is mortgaged as a collateral security, and sold out to one Kuppili Niranjana Kumari (LW.7), on 03.03.2014 much prior to mortgaging the same to the bank. In fact, he sold the said residential flat with forged and fabricated sale deed. It is evident that A.2 and A.3 with an intention to commit fraud, prepared a forged sale deed vide Document No.2718/2007 of Sub Registrar’s Office, Vizianagaram and got prepared forged Statement of Encumbrance on property in respect of the residential flat and fraudulently got enhanced the cash credit facility up to Rs.27.00 lakhs, with the active connivance of bank staff and 5 VJP, J CRLP_10069 _2023 others, who are A.6 to A.8 and thereby cheated the bank and caused huge loss to the bank. On the complaint given by the Assistant General Manager, Canara Bank, a case in Crime No.10 of 2019 was registered for the offences punishable under Sections 420, 406, 409, 403, 468 read with Section 120-B IPC and Section 13 (1)(c) of the Prevention of Corruption Act. After completion of investigation, the police filed the charge sheet before the Chief Metropolitan Magistrate, Visakhapatnam, who in turn, taken the cognizance of the case under Sections 420, 403, 406, 468, 471 IPC against A.1 to A.3; under Section 468 IPC against A.2 to A.4; under Section 420 IPC against A.5; under Section 409 IPC against A.6 to A.8; under Section 120B IPC against A.1 to A.8. Challenging the said taking cognizance of the case, the petitioner, who is arrayed as A.7, filed the present Criminal Petition. 4. Heard the learned counsel for the petitioner and the learned Additional Public Prosecutor for the respondents. 5. Learned counsel for the petitioner, while reiterating the contents of the petitioner, mainly challenges the validity of cognizance of the offence as against the petitioner/A.7, on the ground of non-application of mind. He submits that even as per the allegations made in the charge sheet, no offence is made out against the petitioner/A.7 and the role of the petitioner is with regard to renewal of loan without inspection 6 VJP, J CRLP_10069 _2023 of the property. In fact, as per the procedure, as and when any loan is time barred, it will be renewed automatically on looking into the documents only without personal inspection and whatever done by the petitioner is in the capacity of his official duties and the said act does not amount to any irregularity and no offence is made out much less the alleged offences. He further submits that during the course of departmental enquiry, the complainant bank issued a letter to the police requesting to exonerate the petitioner/A.7 as well as A.8 from the accusation levelled against them since the alleged acts of the petitioner and A.8 in processing the loan applications for renewal is an irregularity and the same was taken by the bank as lenient and the matter was allowed to rest. He submits that in the absence of active role played by the petitioner/A.7 in the alleged offence, initiation of the accusation against the petitioner/A.7 is nothing but an abuse of process and prays for quashing the proceedings. 6. On the other hand, learned Additional Public Prosecutor, while reiterating the contents of the charge sheet, submits that since the alleged offences are serious in nature where misappropriation of huge amount is involved, whether the petitioner/A.7 is committed the alleged offences is a matter to be decided by a competent court and it is not a fit case to quash the proceedings. 7 VJP, J CRLP_10069 _2023 7. Perused the material on record. The petitioner mainly challenges the validity of the criminal proceedings launched against him. In fact, the role of the petitioner/A.7 is limited to the extent of processing the loan application for renewal in the capacity of his official duties, except that no active role has been played by him in the alleged offences. In support of his contention, learned counsel for the petitioner placed on record a copy of the letter dated 29.10.2019 issued by the complainant- bank to the police, wherein it is stated that since the irregularity committed by its employees in renewal of the application was taken as lenient, no actionable lapses were identified and accordingly no action was taken against them and treated the matter as allowing to rest and requested to exonerate them from the criminal proceedings. In support of his contention, the learned counsel for the petitioner placed a reliance on Lalankumar Singh and others v. State of Maharashtra1 to contend that while ordering issuance of process, the Magistrate is required to apply his mind as to whether sufficient ground for proceeding exists in the case or not and the formation of such opinion is required to be stated in the order itself. 8. Keeping in view the principle laid down in the judgment referred to supra, a thorough reading of the charge sheet and the material on 12022 Live Law (SC) 833 8 VJP, J CRLP_10069 _2023 record would reveal that no where it is stated about the active role of the petitioner/A.7 in the alleged offences of cheating and misappropriation. Further, except the averment that the petitioner renewed the loan, nothing was stated about the role of the petitioner/A.7 in the alleged offences. In fact, the process of renewal of loan by the petitioner/A.7 is in discharge of his official duties. A perusal of the letters dated 29.10.2019 and 23.09.2021 addressed by the bank to the police, would further show that during course of departmental investigation conducted, the competent authority has taken a decision that no actionable lapses were identified in the investigation report and hence no action was taken against the concerned employees and treated the matter as allowed to rest/ cautioned by Vigilance Wing, Head Office. For better understanding, the relevant portion is extracted hereunder: “3.After receiving the explanation letter and branch confirmation, the competent authority has taken a decision that no actionable lapses were identified against the said employees. Hence no action was taken against them and treated the matter as allowed to rest. 4. We are herewith attaching our earlier letter dated 29.10.2019 and NIL lapses letter sent to the employees for your reference. 9 VJP, J CRLP_10069 _2023 In view of the above facts, we request you to take note of the above points and consider exonerate our employees Sri A.Kanakeswarudu and Smt.B.Manjula Devi from M/s Simhadri Civil Technologies case and do the needful.” 9. Having regard to the facts and circumstances of the case and taking into consideration the fact that the competent authority of the complainant bank has already exonerated their employees including the petitioner herein from the alleged offences, this court is of the opinion that no useful purpose would be served in allowing the proceedings to continue against the petitioner/A.7 and it is a fit case to quash the proceedings initiated against the petitioner/A.7 alone. Accordingly, the Criminal Petition is allowed and the proceedings initiated against the petitioner/A7 in C.C.No.2168 of 2022 on the file of the Court of Chief Metropolitan Magistrate, Visakhapatnam, are hereby quashed. As a sequel thereto, miscellaneous petitions, if any, shall stand closed. _________________________________________ Dr.JUSTICE VENKATA JYOTHIRMAI PRATAPA Date:28.11.2025 KKV