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TMI Blog2018 (9) TMI 2094X X X X Extracts X X X X X X X X Extracts X X X X ..... able conditions. The facts of the case are that an FIR was lodged on the basis of complaint made by one Shri Manohar Dhingra, Assistant General Manager, Oriental-Bank of Commerce, Meerut against the revisionist as well as other co-accused being FIR No. RC BDI/2018/E0002 dated 22.2.2018 at P.S. C.B.I. BS & FC u/s 120-B read with Section 420 & 409 IPC, Section 13 (2) read with Section. 13 (1) (d) of P.C. Act, 1988 stating therein that the Oriental Bank of Commerce had sanctioned financial liability to revisionist's company registered as Simbhaoli Sugars Ltd. Hapur, Ghaziabad for financing individuals/JLGs/SHGs/Sugarcane farmers under tie up arrangement with M/s Simbhaoli Sugars Ltd., Simbhaoli (hereinafter referred to 'the company') which was engaged in the business of manufacturing of refined sugar, white crystal sugar and specialty sugar etc. and the revisionist is Chief Executive Officer of the said company. In pursuance of RBI Master Circular dated 1.7.2011, a scheme for financing the sugarcane farmers was approved by the O.P. No.3-Bank and in pursuance to it, the proposal was submitted by O.P. No.3- Bank to erstwhile Regional Office of the Oriental Bank of Commerce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... route the payment of sugarcane supplied by the borrower through his loan account opened by the borrower with the bank. 8.4 In case of any default on part of the company or its field functionaries or other employees in paying to the bank or routing the payment of sugarcane supplied by the borrower through their loan accounts with the Bank, then the company shall be liable as borrower to the Bank to the extent of the amount not paid to the bank or not so routed through the loan account of the borrower with the bank as well as interest due, penal interest and any other charges related thereto. 8.5 As the loan sanctioned is disbursed by the Bank to the farmer directly by crediting the account of the company with the Bank in case the borrower fails to supply sugarcane crop to the Company, then the company is liable as borrower to the Bank for the amount outstanding in the loan account of the farmer including interest due, penal interest and any other charges related thereto. 8.6 The Company shall itself be liable for and shall arrange to remit the entire outstanding dues of the borrower arising as a result of improper identification of the borrower by the company or on account of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he farmers which they had diverted. Upon acknowledgment of the liability by the company and converting the loan into secured loan, the company undertook to gradually reduce the bank's dues. A corporate loan of Rs.110.00 crores was sanctioned by the O.P. No.3-Bank on 28.1.2015 with multiple banking arrangements with SBI as the lead with following securities :- (a) subservient first pari-passu charge on all the movable and immovable fixed assets, present and future including equitable mortgage on land of the company with FACR of 1.25 times (minimum). (b) Personal Guarantee of Directors/Promoters of the company. The joint application was filed before the DRT Lucknow for recording the liquidation of liability of the company and passing of consent order for disposing of the case filed by the Bank. The DRT, while recording the same, has allowed the withdrawal of the said case and disposed of the matter on 16.3.2016. Thereafter, a total liability of Rs. 112,93,99,471/- was finally adjusted on 30.6.2018 by way of deposit of Rs.110.00 crores sanctioned on 28.1.2015 by Bank and by way of depositing Rs.2,93,99,471/- by the company from their own sources. The said corporate loan of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CC 691 in which it has been laid down that for prosecution of the director of a company, a clear case has to be spelt out which is not the case in hand. As he had already left the company in September 2013 and had nothing to do with the company since then. It is further argued that the revisionist intends to travel abroad to earn his livelihood which right cannot be whittled down as the same would be a fundamental right under Articles 19 and 21 of the Constitution. There was no specific role levelled in the FIR against him. Further it is argued that the trial court has not considered that at the time of fresh corporate loan which came to be sanctioned on 28.1.2015, the same was classified as NPA on 29.11.2016 while he had already left the company in September 2013. Further it is argued that the joint application was filed before the DRT Lucknow for recording the liquidation of liability of the company and passing of consent order for disposing of the case, filed by the Bank which was allowed by the DRT and the case was disposed of by withdrawal of the same vide order dated 16.3.2016. Thereafter, the total liability of Rs.112,93,99,471/- was finally adjusted by sanction of corporate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner was lodged on 15.5.2017 while notice was issued on 15.6.2017 calling upon the petitioner to appear before the Station House Officer/Investigating Officer on 29.6.2017 and on the very next date i.e. 16.6.2017 the impugned LOC was issued which shows that there could have been no reason to suppose that the petitioner would not appear before the Station House Officer/Investigating Officer. Further, it is held that the issuance of LOC is governed by the executive instructions as contained in Office Memoranda dated 5.9.1979 and dated 27.12.2000, as modified by Office Memorandum dated 27.10.2010. Such LOCs cannot be issued as a matter of course, but only when reasons exist, where the acused deliberately evades arrest or does not appear in the trial court. In these circumstances, the Court held that condition precedent for issuance of the impugned LOC were absent, and the same was held liable to be set aside. We are not inclined to extend the benefit to the revisionist-accused of the law laid down in the judgment of Karti P. Chidambaram (Supra) because in the present case, the LOC has been issued with a view to interrogating the revisionist in the matter at hand wherein the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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