TMI Blog2017 (8) TMI 1713X X X X Extracts X X X X X X X X Extracts X X X X ..... pal accused, that is the branch manager, Atanu Kr. Mitra, as a facile cover-up to justify his unauthorized extension and/or enhancement of cash credit facilities and other financial benefits to the borrowers in utter disregard to prudent banking procedure and his permissible lending limits thereby causing wrongful loss to the bank. It is nobody s case that the instant prosecution was initiated on the finding of the disciplinary authority which has been set aside by a superior authority. On the other hand, the instant prosecution and the proceeding under the Chartered Accountants Act have completely different scope and arena of enquiry and adjudication. While the former involves a prosecution into allegations of conspiracy with a public servant to misappropriate public funds of a bank, the latter is restricted to professional misconduct alone. The findings of the Disciplinary Committee by no stretch of imagination can be said to be binding on the criminal court where the accusation is to be proved on the basis of evidence adduced before it in accordance with law - The Committee was not at all concerned with the allegations of criminal conspiracy and/or criminal misconduct which a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and term loan facilities much above his permissible capacity and permitted the diversion of the cash credit limits for various other purposes without ensuring requisite guarantee margin of 25% and thereby caused wrongful loss to the bank. To camouflage such dishonest activity, the aforesaid accused persons utilized the services of the petitioner, who in collusion and conspiracy with the accused persons prepared false and bogus projected financial statements and other documents to give an impression of credibility to the grant of cash credit and other facilities to the firms of the accused persons, some of whom were even fictitious. It has further been alleged that the petitioner had not only prepared the projected financial statements in favour of the borrowers but had also written with his own hand the applications for enhancing cash credit and other facilities submitted before the principal accused, Atanu Kr. Mitra, the senior manager, exposing his deep rooted involvement in the aforesaid fraudulent transaction. Accordingly, in conclusion of investigation, police report was filed against the petitioner and the other accused persons under sections 120B/419/420/467/468/471 I.P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rator was entrusted with the duty of preparing false and bogus estimated projected financial statements for seeking enhancement of cash credit limits and had even written loan applications on behalf of the borrowers for such purpose. Mr. Ali strenuously contended that the findings of the Enquiry Committee are of no relevance to the allegations of conspiracy against the petitioner which is the subject-matter of prosecution in the instant case. The short issue which, therefore, falls for consideration is whether the exoneration of the petitioner by the Disciplinary Committee vide order dated 8 th February, 2016 would render the allegations against him in the impugned prosecution groundless so as to justify his discharge at this stage. In order to adjudicate such contention, I have gone through the allegations in the impugned charge sheet. I find that the role of the petitioner is not restricted to mere certification as to the nature of business of the accused borrowers as claimed by the Committee in its reports dated 8th February, 2016. He had been employed by the accused borrowers to prepare projected financial statements of the firms and there is ample materials on record to sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se. Enunciating this proposition, the Apex Court in (NCT of Delhi vs. Ajay Kumar Tyagi, (2012) 9 SCC 685) held as follows:- 24. . . .exoneration in departmental proceeding ipso facto would not lead to exoneration or acquittal in a criminal case. On principle also, this view commends us. It is well settled that the standard of proof in department proceeding is lower than that of criminal prosecution. It is equally well settled that the departmental proceeding or for that matter criminal cases have to be decided only on the basis of evidence adduced therein. Truthfulness of the evidence in the criminal case can be judged only after the evidence is adduced therein and the criminal case can not be rejected on the basis of the evidence in the departmental proceeding or the report of the Inquiry Officer based on those evidence. 25. We are, therefore, of the opinion that the exoneration in the departmental proceeding ipso facto would not result into the quashing of the criminal prosecution. We hasten to add, however, that if the prosecution against an accused is solely based on a finding in a proceeding and that finding is set aside by the superior authority in the hierarchy, the v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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