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2017 (3) TMI 1926 - SC - Indian LawsRecovery of Loan amount - legality of the order of issue of process - whether the material available is sufficient enough to constitute a prima facie case against the accused? - HELD THAT:- 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. Under the 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 Kotak 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. 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. Thus, 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 29.03.2006. 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 - 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. Appeal allowed.
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