PRAKASH CHANDRA SRIVASTAVA S/O RAMESHWAR DAYALversusSTATE OF MAHARASHTRA THROUGH CBI/BS/FC/MUMBAI

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              Tikam

                            IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                  CRIMINAL APPELLATE JURISDICTION

                            CRIMINAL REVISION APPLICATION NO. 188 OF 2023

                   Prakash Chandra Srivastava S/o
VAISHALI
                   Rameshwar Dayal                                 ...Applicant
ANIL
                   VERSUS
TIKAM
                   State Of Maharashtra & Anr.                     ...Respondents
Digitally signed   _________________________________________________________________
by VAISHALI
ANIL TIKAM
Date: 2026.10.08   Mr. Vaibhav Swami i/b Satyadev Joshi, Advocate for Applicant.
11:15:31 +0530
                   Mr. Kuldeep S. Patil, SPP a/w. Digvijay S. Kachare a/w. Saili Dhuru a/w.
                   Anay Joshi a/w. Sumitkumar Nimbalkar a/w. Yukta Sawant a/w. Sanika
                   Joshi for Respondent No.2.
                   Mr. S.M. Mangaonkar, APP for Respondent-State.
                   _________________________________________________________________

                                                      CORAM      :     SHIVKUMAR DIGE, J.
                                                      DATE       :     28th SEPTEMBER 2026.
                   P.C. :

                   1.         The challenge in this application is to the order of framing

                   charges against the Applicant, by the learned Special Judge, CBI Special

                   Court, City Civil & Sessions Court, Greater Bombay. Earlier this Court

                   (Coram: Justice Shri. Sandeep Marne) had rejected the discharge

                   application of the Applicant. The said order was challenged before the

                   Hon’ble Apex Court. The Hon’ble Apex Court remanded matter to this

                   Court for fresh hearing, as the chargesheet had not been filed while

                   passing said order.

                   2.         It is prosecution's case that the present case came to be

                   registered on the basis of a written complaint filed by Shri A. W. Sathe,


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    Deputy General Manager, Corporate Finance Branch (for short, “CFB”),

    Central Bank of India (for short, “Bank”), Mumbai against M/s Biotor

    Industries Ltd. (for short, “M/s. BIL”), its directors, employees, agents and

    other unknown public servants under Sections 120-B, 420, 467, 468, 471

    of the Indian Penal Code, 1860 and Section 13(2) read with Section 13(1)

    (d) of the Prevention of Corruption Act, 1988. In the complaint, it had

    been alleged that M/s BIL was engaged in the business of manufacturing

    castor oil and other derivatives and, in furtherance of a conspiracy to cheat

    the Bank through its representatives, had approached the Bank for

    sanction of a Sales Bill Financing Facility of Rs. 50 Crores, for financing the

    farmers who were supplying castor seeds (raw material) to M/s BIL. The

    said company, through its representatives, dishonestly represented to the

    Bank that the said finance was intended for the farmers who were

    supplying castor seeds (raw Material) to said company and it would act as

    a Management and Collection Agent (M&C Agent) i.e. an intermediary

    between the bank and the beneficiary farmers under the said loan facility

    and assist the bank in ascertaining eligible farmers and then disburse the

    loan proceeds to such farmers. In furtherance of the said conspiracy,

    relying on the said representation and on executing M&C agreement, the

    Bank sanctioned the requested loan facility to M/s BIL and opened loan

    accounts in the names of 1597 fictitious farmers on the basis of forged and



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    fabricated documents submitted by M/s BIL. In furtherance of this

    conspiracy, M/s BIL through its representatives, got the loan disbursements

    in its own accounts and thereafter in accounts of 10 different persons. The

    said loan amounts were thereafter routed back to M/s BIL, and the

    proceeds did not reach the farmer beneficiaries. It is alleged that Applicant

    (i.e. Accused No. 14) was working as General Manager at Priority Sector

    Department, Central Bank of India, Mumbai, at the relevant time. It is

    alleged that the Applicant was involved in processing and recommending

    the loan facility despite adverse financial position of M/s BIL and thereby

    acted in furtherance of the alleged conspiracy to cause wrongful loss of

    approximately Rs. 56.25 crores to the bank.

    3.         It is contention of learned counsel for the Applicant that

    executive briefs dated 08/07/2009 (D-15) and 18/07/2009 (D-19) were

    prepared by Corporate Finance Branch (for short, “CFB”) and Priority

    Sector Department copied executive brief dated 18/07/2009 (D-19) of CFB

    on its executive brief dated 20/07/2009 (D-22). Thus, the contents of

    executive brief (D-19) were merely reproduced in executive brief (D-22). It

    is submitted that Applicant had no role in preparing, drafting or

    formulating either executive brief (D-19) or executive brief (D-22).

    Applicant’s signature on executive brief (D-22) was only in his ministerial

    capacity as forwarding authority along with two General Managers.



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    Applicant recommended the executive brief (D-22), many seniors including

    Deputy General Manager and Assistant General Manager of CFB had

    already recommended it. Also, after Applicant’s recommendation, the said

    executive brief (D-22) was further recommended by Chairman and

    Managing Director (for short, “CMD”), Executive Director (for short, “ED”)

    and two General Managers (LAC members). It is further submitted that the

    Management Committee of the Board, being supreme decision-making

    body, was authorised to sanction any loan, including new kind of loan in

    the interest of Bank. It is submitted that normal procedure was followed in

    sanctioning the loan, and there was no deviation in the loan policy in

    respect of M/s BIL, and in case of deviation, ED and CMD are empowered

    as per the loan policy to allow deviation. It is submitted that applicant was

    not even distinctly connected in preparation of executive brief proposal (D-

    19).

    4.         Learned Counsel further submitted that M/s BIL was a client of

    CFB branch and after the sanction of said Rs. 50 Crores, the Bank board

    sanctioned another loan facilities on 12/10/2009 towards M/s BIL on the

    recommendation of CFB. As per the statement of HK Vesuna, GM-credit,

    (PW-36) the Priority Sector Department never dealt with loan proposals

    and all the loans including agriculture, loans were dealt by the Credit

    Department of the Bank for decades and in May 2019, it was decided by



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    CMD–Shri. S. Sridhar and ED-Shri. Ramnath Pradeep, that agriculture

    loans shall be dealt with by the Priority Sector Department, even though

    they did not have infrastructure or expertise to handle the new assignment.

    Furthermore, while sanctioning the said loan, there was an important

    condition that M/s BIL shall submit post-dated cheques of the equal

    amount i.e. Rs. 50 Crores as collateral security. However, said cheques

    were lost by CFB Department.

    5.         Learned counsel further submitted that Staff Accountability

    Reports, marked D-155 and D-156, were prepared after internal scrutiny,

    and they do not attribute any lapse, omission or misconduct to Applicant

    and instead identify other officers as responsible for the alleged

    irregularities. It is submitted that the prosecution cannot rely selectively

    upon inculpatory portions of its own material while ignoring exculpatory

    findings contained in the same record. The omission to consider these

    reports shows selective and arbitrary prosecution. Moreover, as per Loan

    Policy Document (D-33), Applicant has not violated any provision or

    policy. No specific clause or provision allegedly breached by him has been

    identified by the prosecution. The RBI Circular forming produced on record

    also does not disclose any deviation or non-compliance attributable to the

    Applicant. It is submitted that not a single witness statement forms part of

    the charge-sheet which shows any act of commission, omission, misconduct



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    or conspiracy to him. On the contrary, the statement of Shri B. Akbalary,

    Deputy General Manager, records that during a one-to-one meeting the ED

    had explained the new model of financing agricultural activities and

    decided to adopt the IDBI model, without any allegation against the

    Applicant.

    6.           Learned Counsel further submitted that the prosecution has

    failed to establish even the basic ingredients of criminal conspiracy. The

    charge-sheet contains only a general and omnibus allegation of conspiracy

    without identifying any agreement, meeting of minds, communication,

    correspondence or specific conduct connecting the Applicant with the other

    accused.

    7.           Learned Counsel further submitted that Applicant had no role in

    sanctioning or disbursing the loan.      The loan proposal was processed

    through a well-defined, multi-layered institutional mechanism, involving

    several independent stages of scrutiny, recommendation and approval. The

    sanction of the loan was not an individual decision, but followed a

    structured hierarchy culminating in the Management Committee of the

    Board of Directors, comprising top-level decision makers, including CMD

    and ED, which was the highest decision-making authority. Learned counsel

    further submitted that the Applicant was not a member of the Management

    Committee.     The entire loan process was institutional and collective in



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    nature involving multiple levels of scrutiny and decision making. The

    Applicant's role was limited to forwarding the proposal. Mere forwarding

    the proposal cannot be construed as participation in decision making

    process or endorsement of the contents of the proposal. However, this fact

    has not been considered by the learned Special Judge and framed charges

    against the Applicant, which is erroneous and requested to allow the

    Application.

    Learned Counsel for the Applicant has relied upon following judgments:

         1) Union of India v. Prafulla Kumar Samal, (1979) 3 SCC 4
         2) State of Karnatak v. L. Muniswamy, (1977) 2 SCC 699
         3) Dilawar Balu Kurane v. State of Maharashtra, (2002) 2 SCC 135
         4) State (NCT of Delhi) v. Navjot Sandhu, (2005) 11 SCC 600
         5) CBI v. K. Narayana Rao, (2012) 9 SCC 512
         6) Sunil Bharti Mittal v. CBI, (2015) 4 SCC 609
         7) Hridaya Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168

    8.          It is contention of learned SPP that the letter dated 06/07/2009

    was sent by the Applicant to the CFB for processing the loan proposal

    despite the fact that CFB dealt with large corporate advances and not small

    farmers, and processing of loans to farmers was generally the responsibility

    of the local branch. It is submitted that this loan, in which company acted

    as Management and Collection Agent (M&C Agent), an intermediary, was

    a new kind of loan which had never earlier been sanctioned in the Central

    Bank and deviated from the normal procedure which were to be followed


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    while processing and recommending such a proposal. The Applicant

    facilitated the taking of the loan proposal out of the ordinary channel and

    routed it through the CFB. M/s BIL submitted forged and fabricated

    documents and opened loan accounts of 1597 farmers within three days.

    In furtherance of this conspiracy, applicant and co-accused got the loan

    disbursements done in its own accounts and thereafter into 10 different

    accounts opened in the names of farmers at OBC Ashram Road branch,

    Ahmedabad. These loan disbursements were eventually routed back to the

    company and the proceeds did not reach farmer beneficiaries resulting in

    wrongful loss to the Central Bank and wrongful gain to M/s BIL and its

    representatives.

    9.         Learned SPP further submitted that executive brief was first

    prepared on 8/07/2009 and it was subsequently redrafted on 18/07/2009.

    Several material changes were made in the said proposal, which were

    favourable to the borrower and diluted the safeguards containing in the

    first proposal. The major differences between the two executive briefs were

    that more thrust was given for compliance of KYC, disbursement of loan

    proceeds, collection of documents, the preparation of documents by M&C

    i.e. M/s BIL and not the disbursing branch. Further obtention of

    application of loan from each farmer, and the sanction to be accorded by

    the disbursing branch separately in the name of individual farmers and



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    pre-sanction inspection was done away in the second executive brief (D-

    19).

    10.        Learned SPP further submitted that the Applicant was not just

    General Manager, Priority Sector Department, but was also a Member of

    Loan Advisory Committee and he recommended the second executive brief

    without raising a single objection despite the fact that the proposal was not

    in accordance with RBI Policy and the Bank's prudential norms and posed

    a higher risk to the Bank. Learned SPP further submitted that the Applicant

    did not merely sign the documents but knowingly recommended the

    altered proposal despite the irregularities appearing on face, particularly

    the outsourcing of the KYC verification of the farmers to the M&C Agent,

    which was contrary to RBI norms and also violated Clause 5.2 of the Bank’s

    loan policy. Learned SPP further submitted that the RBI policy did not

    permit classification of the loan as agricultural finance loan to an

    Artiya/Middleman for onwards lending to farmers. Learned SPP further

    submitted that financial position of M/s. BIL was not disclosed in second

    executive brief (D-19). Though, the financial condition of the said

    company was available in the first executive brief (D-15), but it was not

    shown in second executive brief (D-19). Despite the financial weakness of

    the borrower being apparent, Applicant recommended the subsequent




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    executive brief. He further submitted that the charges are rightly framed

    against the Applicant and requested to reject the application.

    11.        I have heard both learned counsel.          Perused documents

    produced on record.     Admittedly, at the relevant time, Applicant was

    General Manager - Priority Sector Department, Central Bank of India. It is

    alleged that he was involved in processing and recommending the loan

    facility despite adverse financial position of M/s BIL and thereby caused

    wrongful loss to the Bank. Executive briefs dated 08/07/2009 (D-15) and

    18/07/2009(D-19) were prepared by CFB. The second executive brief was

    less transparent, involved higher risk, and diluted diligence to be

    undertaken by the Bank before sanctioning the loan. Subsequently,

    Applicant got another executive briefs prepared, which were reproduction

    of the terms and conditions of executive brief (D-19), without any

    independent modification or decision-making, with cover pages dated

    20/07/2009, 22/07/2009 and 28/07/2009. The executive brief (D-19)

    was designed in a manner to unduly benefit M/s BIL and not the farmers.

    It is alleged that in the executive brief (D-15), the financial condition of

    M/s. BIL was specifically mentioned. But, in executive brief (D-19), the

    said financial position was not mentioned. It is alleged that several

    material changes, which were favourable to the borrower, which diluted

    the safeguards contained in the executive brief (D-15) were made in the



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    second executive brief (D-19). It is alleged that Applicant recommended

    the subsequent brief. Applicant was one of the authorities, involved in the

    process of approving the loan proposal. The statement of Shri Paul Mathew

    (PW-8) shows that he received a call on 04/07/2009 from ED-Ramnath

    Pradeep and was informed about the proposal for financing farmers

    supplying castor seeds to M/s. BIL. He has further stated that the proposal

    was to be processed through CFB and Applicant had also called him over

    the phone and informed him that the party would come with a proposal

    and that they were interested in getting finance for farmers supplying

    Castor seeds to M/s. BIL. This witness further stated that Applicant and

    ED-Ramnath Pradeep discussed the proposal and the matter in which it

    was to be processed.   The statement of the witness R. B. Gupta (PW-12)

    shows that there were major differences between the first and second

    executive brief with regard to the repayment terms, compliance with KYC

    norms, history and details of the account, monitoring of the account,

    identification of farmers, ownership of land, documentation, hypothecation

    of receivables/crop, and prevention of double financing. These conditions

    constituted material safeguards in relation to the loan facility, and the

    executive brief (D-19) appears to have shifted or diluted several of these

    safeguards in favour of the M&C Agent/company. The statements of these

    witnesses shows the active involvement of the Applicant in the loan process



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    and there was conspiracy to make favourable changes in the second

    executive brief. Applicant had participated in the process leading to the

    alteration and recommendation of the second executive brief without

    raising any objection, despite the fact that the proposal was not as per RBI

    policy and bank prudential norms and posed higher risk to the Bank.

    12.        It appears that the final authority to sanction the loan was the

    Management Committee and that the Applicant was not a member thereof.

    However, the Applicant was not the final sanctioning authority cannot be

    considered in isolation at this stage. Applicant along with co-accused

    participated in the process of getting the executive brief redrafted and was

    involved in the process leading to the consideration and recommendation

    of the proposal. The Applicant was a member of loan advisory committee,

    and he was General Manager of Priority Sector Department. The

    statements of the witnesses and documents produced on record gives rise

    to a prima facie case requiring consideration at trial.

    13.        I have gone through the case laws cited by learned counsel for

    the Applicant, the facts of cases cited are different from the present case,

    hence not applicable. In view of above, I pass following order.

                                       ORDER

        (i)        Criminal Revision Application is rejected.
        (ii)       All pending Applications are disposed of.

                                                     (SHIVKUMAR DIGE, J.)

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