CENTRAL BUREAU OF INVESTIGATIONversusJAGJIT SINGH

                  [2013] 17 S.C.R. 361


        CENTRAL BUREAU OF INVESTIGATION                      A
                           lt.
                     JAGJIT SINGH
           (Criminal Appeal No.158b of 2013)
                   OCTOBER 1, 2013
                                                             B
 [SUDHANSU JYOTI MUKHOPADHAYA AND RANJAN
                 GOGOi, JJ.]

     Code of Criminal Procedure, 1973 - s.482 - Criminal
proceedings u/ss. 4201471 /PC -Allegation of defrauding the C
Bank - Compromise between Ban~ and accused - Debt due
to the Bank paid pursuant to order of Debts Recovery Tribunal
- Criminal proceedings quashed in view of the compromise
- Held: - Offences ulss. 4201471 /PC against Bank, fall under
the category of offences involving moral turpitude committed D
by public servants while working in that capacity - Hence,
criminal proceedings not liable to be quashed - Inherent
powers to be exercised to secure the ends of justice and to
prevent a'buse of process of Court- In the instant case neither
abuse of process of Court was alleged, nor was a case made E ·
out that proceedings were required to be quashed in the
interest of justice - Penal Code,. 1860 - ss.4201471.

     FIR was lodged against the respondent-accused
alleging that he obtained bank-loan on the basis of forged
documents~ with the aid of officers of the Bank. Criminal    F
proceedings were initiated against him u/ss. 420/471 IPC.
The respondent-accused settled the dispute with the
Bank and repaid the loan amount to the Bank pursuant
to the order passed by Debts Recovery Tribunal. The
respondent-accused moved application u/s. 482 Cr.P.C.        G
High Court allowed the same, quashing the criminal
proceedings. Hence the present appeal.


                           361                               H
    362         SUPREME COURT REPORTS [2013] 17 S.C.R.


A         Allowing the appeal, the Court

         HELD: 1. Inherent jurisdiction is distinct and different
    from the power given to a criminal court for compounding
    the offences under Section 320 Cr.P.C .. Inherent power
8   is of wide plenitude with no statutory limitation but it has
    to be exercised in accord with the guideline engrafted in
    such power viz.:(i) to secure the ends of justice, or (ii) to
    prevent abuse of the process of any court. Any
    compromise between the victim and the offender in
C   relation to the offences under special statutes like the
    Prevention of Corruption Act or the offences committed
    by public servants while working in that capacity, etc.;
    cannot provide for any basis for quashing criminal
    proceedings involving such offences. The High Court
    must consider whether it would be unfair or contrary to
D   the interest of justice to continue with the criminal
    proceeding or continuation of the criminal proceeding
    would tantamount to abuse of process of law despite
    settlement and compromise between the. victim and the
    wrongdoer and whether to secure the ends of justice, it
E   is appropriate that the criminal case is put to an end.
    [Para 13] [369-C-E, G, H; 370-A, D-F]

       2. In the present case, the specific allegation made
  against the respondent- accused is that he obtained the
F loan on the basis of forged document with the aid of
  officers of the Bank. On investigation, having found the
  ingredients of cheating and dishonestly inducing delivery
  of property of the Bank (Section 420 IPC) and dishonestly
  using as genuine a forged document (Section 471 IPC),
  chargecsheet was submitted under Sections 420/471 IPC
G against the accused persons. [Para 14] [370-G-H; 371-AJ

      3. The debt which was due to the Bank was
  recovered by the Bank pursuant to an order passed by
  Debts Recovery Tribunal. Therefore, it cannot be said that
H there was a compromise between the offender and the
 CENTRAL BUREAU OF INVESTIGATION v. JAGJIT               363
                 SINGH
victim. The offences when committed in relation with           A
Banking activities including offences under Sections 420/
471 IPC have harmful effect on the public and threaten
the well being of the society. These offences fall under
the category of offences involving moral turpitude
committed by public servants while working in that             B
capacity. Prima facie, one may·state that the bank as the
victim in such cases but, in fact, the society in general,
including customers of the Bank is the sufferer. In the
present case, there was neither an allegation regarding
any abuse of process of any Court nor anything on              c
record to suggest that the offenders were entitled to
secure the order. in the ends of justice. The High Court
has not considered the above factors while passing the
impugned order. Hence, the High Court erred in
addressing the issue in· right perspective. The trial court
                                                               0
is directed to proceed the matter in accordance with law.
[Paras 15 and 16] [371-B-F]

    Gian Singh vs. State of Punjab and Anr. (2012) 10 SCC
303: 2012 (8) SCR 753 - relied on.
                                                               E
     Gian Singh vs. State of Punjab and Anr. (2010) 15 SCC
118: 2010 (13) SCR 1034; B.S. Joshi and Ors. vs. State of
Haryana and Anr. (2003) 4 SCC 675: 2003 (2) SCR 1104;
Nikhil Merchant vs. Central Bureau of Investigation and Anr.
(2008) 9 SCC 677: 2008 (12) SCR 236; Manoj Shrma vs.           F
State and Ors. (2008) 16 SCC 1: 2008 (14)       SCR 539 -
referred to.

                    ·Case Law Reference:
   2012 (&) SCR 753           relied on        Para 13         G
   2010 (13) SCR 1034         referred to      Para 13
   2003 (2) SCR 1104           referred to .   Para 13

                                                               H
    364         SUPREME COURT REPORTS [2013] 17 S.C.R.

A      2008 (12) SCR 236           referred to       Para 13
       2008' (14) SCR 539          referred to       Para 13
        CRIMINAL APPELLATE JURISDICTION: Criminal Appeal
    No. 1580 of 2013
B
        From the Judgment and Order dated 31.03.201 O of the
    High Court at Calcutta in Criminal Revision Application CRR
    No. 719 of 2010.

      L.N. Rao, Rajiv Nanda, B. V. Bairam Das, Arvind Kumar
C Sharma for the Appellant.

        Bijan Ghosh, Vijay Lakshmi, Reema Pandey, Gautam
    Dass, Anurag Pandey for the Respondent.

          The Judgment of the Court was delivered by
D
        SUDHANSU JYOTI MUKHOPADHAYA, J. 1. Leave
    granted.

       2. By this appeal, the appellant-Central Bureau of
E Investigation ('CBI' for short) has challenged the impugned
  order dated 31st March, 2010 passed by the High Court of
  Calcutta in CRR No. 719 of 2010. By the impugned order,
  learned Judge of the High Court allowed the application
  preferred by the respondent, Jagjit Singh, under Section 482
F of the Criminal Procedure Code, 1973 and quashed the
  proceedings being G.R. Case No.1508 of 2006 pending
  before the 12th Court of Metropolitan Magistrate, Calcutta.

       3. The said case relates to CBl:SPE:ACB:Kolkata Case
  No.R.C. 12(A)/2003 under Sections 420/471 of the Indian Penal
G Code. The First Information Report(FIR) in questibn was lodged
  on the basis of a reliable information which was received in the
  office of the SP, CBI, ACB, Kolkata to the effect that one Shri
  Sanjib Kumar Chatterjee while functioning as Sr. Manager,
  Indian Overseas Bank (IGS), Shreemani Market Branch,
H Kolkata during the year 1998-2000 had entered into a criminal
  CENTRAL BUREAU OF INVESTIGATION v. JAGJIT                 365
   SINGH [SUDHANSU JYOTI MUKHOPADHAYA, J.]
conspiracy with private persons, namely, Shri Jagjit Singh,         A
Director of M/s. Tag Reachers (P) Ltd. (respondent herein), Shri
Raj Kumar Agarwal, Shri Virendra Jain and unknown officers
of the Regional Office, Business Department of Indian Overseas
Bank, Kolkata in order to cause wrongful loss to the said Bank
in the matter of term/demand loans, in favour of M/s. Tag           B
Reachers (P) Ltd. It was further alleged in the FIR that in
furtherance of said criminal conspiracy, term/demand loans
amounting to Rs.1,94,50 lakhs were fraudulently and
dishonestly sanctioned to the said Company by the Regional
Office of Indian Overseas Bank(IOB), Kolkata and out of the         c
said amount Rs.1.5 crores remained outstanding due to non-
payment by the party: All the accounts of parties involved
became inoperative, and this resulted in corresponding wrongful
loss to the said Bank.
                                                                    D
     4. It is further alleged that on the recommendation of the
said Shri Sanjib Kumar Chatterjee, Sr. Manager, three term
loans were sanctioned by the Regional Office of !OB in August,
1998, October, 1999 and August, 2000 in favour of Mis. Tag
Reachers (P) Ltd. for purchase of 13 Nos. of LPG Tankers
(4+4+5 respectively) without proper verification, documentation     E
and by manipulating exorbitant price of the collateral properties
offered by Mis. Tag ReaGhers (P) Ltd.

     5. The said inforrAation has also disclosed that when Mis.
Tag Reachers (P) Ltd. started defaulting the repayment in the       F
aforesaid term loan accounts, the accused persons connived
together and in pursuance of the said criminal conspiracy Shri
Jagjit Singh as Director of Mis. Tag Reachers (P) Ltd.
approached Shri Sanjib Kumar Chatterjee, Sr. Manager in the
month of March, 2000 for a demand loan of Rs.32.50 lakhs            G
against the .security of National Saving Certificate/Kishan
Vikash Patra of the face value of Rs.50 lakhs. The said
securities were in the form of NSC for Rs. 7 lakhs and Kishan
Vikash Patra of Rs.18 lakhs standing in the name of the
aforesaid Shri Raj Kumar Aggarwal and Kishan Vikash Patra
                                                                    H
    366         SUPREME COURT REPORTS [2013] 17 S.C.R.


A of Rs.25 lakhs standing in the name of the aforesaid Shri
  Virendra Jain. All the NSCs and KVPs were alleged to be
  forged and fabricated and were not issued from the Middleton
  Row and Park Street Post Offices from where they were shown
  to have been reportedly purchased. Similarly, no lien on them
B in favour of the IOB were created by the aforesaid two Post
  Offices. Lien were found to be forged and no Bank Officer had
  in fact ever approached these two Post Offices for the same.
  In spite of this and knowing fully well that the amount of the
  aforesaid term loaris were diverted by Shri Jagjit Singh to his
c restaurant business, Shri Sanjib Kumar Chatterjee, Sr.
  Manager recommended sanction of Demand loan for Rs.32.50
  lakhs in favour of M/s. Tag Reachers (P) Ltd. With the help of
  unknown officials of the Regional Office of IOB, Kolkata a
  demand loan of Rs.32.50 lakhs was sanctioned in favour of the
D said company on 30th March, 2002.

       6. It has also been disclosed by the said information that
  though it was the last day of the financial year, Rs.27.25 lakhs
  out of Rs.32.50 lakhs was transferred to the Term Loan Account
  of M/s. Tag Reachers (P) Ltd. on 30th March, 2002 itself
E towards partial adjustments of the aforesaid term loan account
  whereas the rest of the amount was withdrawn by M/s. Tag
  Reachers (P) Ltd., Kolkata.

         7. It is found that for the acts of the omissions on the part
F   of the accused persons, entire Term/Demand loans became
    unsecured and inoperative now. The Bank suffered a loss of
    Rs.1.5 crores (approx. Rs.1.59 crores with accrued interest)
    since all the loan accounts have become NPA (Non Performing
    Assets).

G     8. It was further alleged that since the above information
  reveals commission of offences punishable under Sections
  1208/420/467/468/471/472 IPC and Section 13(1)(d) read with
  Section 13(2) of Prevention of Corruption Act, 1988 by the
  aforesaid accused persons, namely, Shri Sanjib Kumar
H Chatterjee, Sr. Manager, Indian Overseas Bank, Shri Jagjit
 CENTRAL BUREAU OF INVESTIGATION v. JAGJIT                    367
  SINGH [SUDHANSU JYOTI MUKHOPADHAYA, J.]
Singh, Director of Mis. Tag Reach~rs (P) Ltd., Shri Raj Kumar         A
Agarwal, Shri Virendra Jain and unknown officers of the
Regional Office, Business Department of Indian Overseas
Bank, Kolkata. a regular case was registered against them and
the said case was entrusted to Shri B.R. Roy Inspector of
Police, CBI, ACB, Kolkata for Investigation.                          B

      9. It appears that the respondent, Jagjit Singh thereafter
settled the dispute with the Indian Overseas Bank and paid the
amount, pursuant to an order No.31 dated 29th August, 2006
passed by the Presiding Officer, Debts Recovery Tribunal,             C
Calcutta in Case No. OA/35/2003. Giving reference to the
above said order passed by the Debts Recovery Tribunal the
respondent, Jagjit Singh moved an application under Section
482 of Cr.P.C. in C.R.R. No.719 of 2010 before the Calcutta
High Court for quashing the proceedings being G.R. Case
No.1508 of 2006.                                                      D

    10. From the impugned order, it would be evident that in
view of such amicable settlement made between the
respondent and the Bank officials, learned Judge of the High
Court by the Impugned order set aside the criminal                    E
proceedings with the following observation:

     "Be that as it may, there cannot be any rigid formula in
     regard to permitting the parties to effect a compromise.
     The offences alleged are undoubtedly non-compoundable
     and certainly, of serious nature.                                F

     The question that arises whether in view of such amiable
     settlement between the parties, any fruitful purpose is likely
     to be served by allowing the criminal proceedings to
     proceed further.                                                 G
     In the present case, as indicated earlier and that too, being
     rightly shown by the learned senior counsel, Mr. De, for
     reasons not knowri, the principal accused, Sanjib Kumar
     Chatterjee, had been left out.
                                                                      H
    368          SUPREME COURT BEPORTS [2013] 17 S.C.R.

A         In the afQresaid fads and circumstan6es, I am inclined to
          hold that further proceedings of the case before the
          learned trial court is not likely to serve any fruitful purpose
          and, as such, in exercise of this court's inherent jurisdiction,
          th~ same be quashed bond at once.
B
          This disposes of C.R.R. No.719 of 2010."

          11. Learned senior counsel for the appellant submitted that
  by a mere settlement between two offenders, the personal
  intent of criminal conspiracy under Sections 420 and 471 IPC
C which are even otherwise not compoundable cannot be
  compounded. According to him, the impugned order passed
  by the learned Judge of the Calcutta High Court is in the teeth
  of well established and settled law laid down by this Court.

0        12. Per contra, according to the respondent, it is always
    open to the Court to quash the criminal proceedings if the
    dispute is of civil nature and if matter is settled between the
    parties. It was contended that the dispute being civil in nature
    and the parties to the dispute being reached settlement, the
E   High Court rightly set aside the criminal proceedings arising
    out of the same very dispute.

       13. The very same issue fell for consideration recently
  before a three-Judge Bench of this Court in Gian Singh v. State
  of Punjab and another, 2012 (10) sec 303. In the said case,
F this Court discussed the relative scope of inherent power of the
  High Court under Section 482 Cr.PC to quash criminal
  proceedings involving non-compoundable offences in view of
  compromise arrived at between the parties. That was a case
  wherein when the special leave petition came up for hearing,
G a two-Judge Bench vide order reported in Gian Singh vs. State
  of Punjab and another, (2010) 15 SCC 118 doubted the
  correctness of the decisions of this Court in 8.S. Joshi and
  others vs. State of Haryana and another, (2003) 4 SCC 675,
  Nikhil Merchant vs. Central Bureau of Investigation and
H another, 2008 (9) SCC 677 and Manoj Sharma vs. State and
 CENTRAL BUREAU OF INVESTIGATION v. JAGJIT 369
  SINGH [SUDHANSU JYOTI MUKHOPADHAYA, J.]
others, (2008) 16 SCC 1 and referred the matter to a larger A
Bench. Hence, the question before the Bench was with regard
to the inherent power of the High Court under Section 482
Cr.PC in quashing the criminal proceedings against an offender
who has settled his dispute with the victim of the crime but the
crime in which he was allegedly involved was not B
compoundable under Section 320 Cr.PC. Discussing different
provisions and taking into consideration the different decisions
of this Court, the larger Bench in Gian 'Singh (supra) held as
follows:

      "61. The position that emerges from the above                    C
      discussion can be summarised thus: the power of the
      High Court in quashing a criminal proceeding or FIR or
      complaint in exercise of its inherent jurisdiction is distinct
      and different from the power given to a criminal court for
      compounding the offences under Section 320 of the                D
      Code. Inherent power is of wide plenitude with no statutory
      limitation but it has to be exercised in accord with the
    . guideline engrafted in such power viz.: (i) to secure the
      ends of justice, or (ii) to prevent abuse of the process of
      any court. In what cases power to quash the criminal             E
      proceeding or complaint or FIR may be exercised where
      the offender and the victim have settled their dispute
      would depend on the facts and circumstances of each
      case and no category can be prescribed. However, before
 . • exercise of such power, the High Court must have due              F
      regard to the nature and gravity of the crime. Heinous and
      serious offences of mental depravity or offences like
      murder, rape, dacoity, etc. cannot be fittingly quashed
       even though the victim or victim's family and the offender
       have settled the dispute. Such offences are not private         G
       in nature and have a serious impact on society. Similarly,
       any compromise between the victim and the offender in
       relation to the offences under special statutes like the
       Prevention of Corruption Act or the offences committed
      by public servants while working in that capacity, etc.;         H
    370         SUPREME GOUR"( REPORTS [2013] 17 S.C.R.


A       cannot provide for any basis for quashing criminal
       ·proceedings involving such offences. But Jhe criminal
        cases having overwhelmingly and predominatingly civil
        flavour stand on a different footing for the purposes of
        quashing, particularly the offences arising from
B       commercial, financial, mercantile, civil, partnership or
        such like transactions or the· offences arising out of
        matrimony relating to dowry, etc. or the family disputes
        where the wrong is basically private or personal in nature
        and the parties have resolved their entire dispute. In this
c       category of cases, the High Court may quash the criminal
        proceedings if in its view, because of the compromise
        between the offender and the victim'. the possibility of
        conviction is remote and bleak and continuation of the
        criminal case would put the accused to great oppression
        and prejudice and extreme injustice would be caused to
D
        him by not quashing the criminal case despite full and
        complete settlement and compromise with the victim. In
        other words, the High Court must cGJnsider whether it
        would be unfair or contrary to the interest of justice to
        continue with the criminal proceeding or continuation of
E       the criminal proceeding would tantamount to abuse of
        process of law despite settlement and compromise
        between the victim and the. wrongdoer and whether to
        secure the ends of justice, it is appropriate that the
        criminal case is put to an en"Cl and if the answer to the
F       above question(s) is Ln the affirmative, the High Court
        shall be well within its jurisdiction to quash the criminal
        proceeding."
         14. In the present case, the specific allegation made
G   against the respondent-accused is that he obtained the loan
    on the basis of forged document with the aid of officers of the
    Bank. On investigation, having found the ingredients of cheating
    and dishonestly inducing delivery of property of the bank
    (Section 420 IPC) and dishonestly using as genuine a forged
H
  CENTRAL BUREAU OF INVESTIGATION v. JAGJIT                   371
   SINGH [SUDHANSU JYOTI MUKHOPADHAYA, J.]
document (Section 471 IPC), charge sheet was submitted                A
under Sections 420/471 IPC against the accused persons.

       15. The debt which was due to the Bank was recovered
  by the Bank pursuant to an order passed by Debts Recovery
  Tribunal. Therefore, it cannot be said tt:iat there is a compromise B
  between the offender and the victim. The offences when
  committed in relation with Banking activities including offences
.under Sections 420/4(1 IPC have harmful effect on the public
  and threaten the well being of the society. These offences fall .
  under the category of offences involving moral turpitude
  committed by public servants while working in tha.t capacity. C
  Prima facie, one may state that the bank as the victim in such
  cases but, in fact, the society in general, including customers
  of the Bank is the sufferer. In the present case, there was neither
  ari allegation regarding any abuse of process of any Court nor .
 •anythrng on record to suggest that the offenders were entitled D
  to secure the order in the ends of justice.

     In the instant case, the High Court has not considered the
above factors while passing the impugned order. Hence, we
are of the opinion that the High Court erred in addressing the        E
issue in right perspective.
                       '
      16. In such circumstances, we set aside the impugned
judgment and order dated 31st March, 2010 passed by the High
Court in CRR No. 719 of 2010 and direct the trial court to
proceed the matter in accordance with law and to conclude the· F.
trial expeditiously. The appeal is allowed with the aforesaid
 observation.

 Kalpana K. Tripathy                                Appeal allowed.