Only Because Loan Proposal Was Cleared Within Short Period, No Offence Is Made Out: SC Dismisses CBI’s Appeal In Corruption Case Against Bank Official
The Supreme Court while dismissing the appeal preferred by the Central Bureau of Investigation observed that only because the loan proposal was processed and cleared within a short period, no offence was made out.
The Court was hearing a Criminal Appeal appeal arising out of a charge sheet filed in the First Information Report registered with the Central Bureau of Investigation for the offences punishable under Sections 420, 468, 471 and 120-B of IPC and Section 13(2) read with 13(1)(d) of Prevention of Corruption Act, 1988.
The bench of Justice Abhay S Oka and Justice Ujjal Bhuyan observed, “Only because the entire proposal was processed and cleared within a short span of time, no offence is made out against the respondent.”
Brief Facts-
In the present case, the Bank sanctioned three facilities to the Company: a Rs. 50 crore short-term loan, a Rs. 100 crore letter of credit, and Rs. 330 crore in Export Packing Credit (EPC) facilities. The Bank disbursed a certain amount under the EPC for a project in Tanzania. However, the Company allegedly misused the funds by transferring them to other accounts, paying builders, and covering insurance premiums, rather than procuring materials for the project. The Company also opened Standby Letters of Credit (SBLCs) worth USD 15 million and EUR 2.05 million for coal and machinery purchases but failed to import goods or make payments, which led to a Rs. 436.74 crore loss for the Bank. An application for discharge by the respondent was rejected by a Special CBI Court, but the High Court discharged the respondent, prompting the CBI to appeal.
The Court noted that the only material that creates suspicion is the speed with which the proposal of the Company was sanctioned.
The Court considered the role ascribed to the respondent and said that mere suspicion against him was not enough to frame a charge against him.
The Court said that no material is placed on record to show that any of the accused other than bank officials ever met the respondent before the sanction of the proposal by the Management Committee.
Accordingly, the Court dismissed the Appeal.
