Delhi court acquits nine accused in corruption case citing “casual” investigation by CBI

Delhi’s Rouse Avenue Court has acquitted nine accused, including one company and four bank officials, in a corruption case nine years after the trial started, citing the “casual” manner of an investigation by the agency.
This case pertains to an alleged fraud of Rs 4.8 crore to a Canara Bank. A case was registered in 2011 and the trial began in 2015.
Special judge Hasan Anzar acquitted Harpreet Fashion Pvt. Ltd., Mohanjit Singh Mutneja, Gunjit Singh Mutneja, Harpreet Kaur Mutneja, Harmendra Singh, Raman Kumar Agarwal, Darwan Singh Mehta, TG Purshottam and CT Ramkumar. Four of the accused were bank employees.
The Court in the judgement passed on June 3, said that the prosecution failed to bring home the charges against the public servants and it also failed to establish that there was any conspiracy between the public servants and the private accused persons or between the private accused persons.
The prosecution has failed to prove that Harpreet Fashion, Mohanjit Singh Mutneja and Harpreet Kaur Mutneja in conspiracy with Gunjit Singh Mutneja and Harmendra Singh have committed any offence of cheating, the court said in the judgement.
It was alleged by the CBI that four separate criminal conspiracies were hatched from 2003 to 2007 by the accused persons to defraud the bank.
CBI alleged that the funds, through 47 different cheques, were diverted to five sister companies of Harpreet Fashion, which were granted a loan by the bank.
“Mere issuance of checks by an accused to its sister concern would not make much difference unless the prosecution explains the diversion of funds by cogent evidence and the charge of diversion of funds could only be sustained, if the end use of such amount is not utilized by the sister concern or is appropriated in some other manner,” the judgment read.
Special judge Hasan Anzar observed that the prosecution has also not examined or analyzed the bank accounts, statement of accounts, balance sheet, and the relevant income tax return of the companies to establish whether any activity was carried out pursuant to the payment made by Harpreet Fashion.”
The prosecution has also failed to make a proper analysis of the statement of accounts of all the sister concerns of Harpreet Fashion and the activities which are being carried out by Harpreet Fashion including the manufacturing activities being undertaken by it, the court said.
“The prosecution has picked up a few cheques on the basis of which it has alleged that a diversion of funds was made,” the court noted.
The Court also noted that none of the employees of the sister companies were questioned by the agency and that none of the prosecution witnesses even “whispered” about the diversion of funds to sister companies from Harpreet Fashion.
It was also observed by the Court that the CBI “didn’t conduct any investigation” with respect to the final balance sheet of the company which would have “shown the clear picture”. It also expressed displeasure over the “feeble explanation” that the bank did not provide proper documents.
It observed that Harpreet Fashion came into existence only in March 2004 which raised questions on the allegation of the prosecution that there was a conspiracy from 2003 to 2007.
“The perusal of the record reveals that despite the poor financial condition of Harpreet Fashion, it was the Circle Office and Head Office which used to grant the limits to Harpreet Fashion and in fact the renewal proposal for the credit facility was proposed by the Circle office and yet in order to build up its case, the prosecution has presented the case in such a manner that it was the Branch who made the proposal to the Circle Office,” the court noted.
The Delhi Court held that the investigating agency has not properly appreciated the role of the Circle office and Head Office and it went after the Parliament Street Branch