K.S. RAMAKRISHNA IYER v. Central Bureau of Investigation (CBI)

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE B.SUDHEENDRA KUMAR** **THURSDAY,THE 11TH DAY OF OCTOBER 2018 / 19TH ASWINA, 1940 Crl.Rev.Pet.No. 927 of 2018** **AGAINST THE ORDER/JUDGMENT IN CC 41/2011 of SPE/CBI COURT, TRIVANDRUM DATED 11-06-2018** **REVISION PETITIONER/S:** **K.S. RAMAKRISHNA IYER, S/O.LATE SUBRAMANIA IYER, AGED 69 YEARS, EARLIER RESIDENT OF KAITHARAM HOUSE, PALLIYIL LANE, DIWANS ROAD, ERNAKULAM AND NOW RESIDING AT FLAT 4-B,ALDEBARAN, POONKUNNAM,THRISSUR-680 002** **BY ADVS. SRI.C.S.MANU MRS.S.SREELAKSHMY SMT.V.SARITHA SRI.C.Y.VIJAY KUMAR SRI.S.K.PREMRAJ** ## **RESPONDENT/S:** **CBI, THIRUVANANTHAPURAM UNIT MALABAR HOUSE, KESTOM ROAD, T.C.11/304,VELLAYAMBALAM,THIRUVANANTHAPURAM-695 003 REPRESENTED BY ITS INSPECTOR.** **BY ADV. SRI. SASTHAMANGALAM S. AJITHKUMAR, SPL.P.P. FOR C.B.I.** **THIS CRIMINAL REVISION PETITION HAVING COME UP FOR ADMISSION ON 11.10.2018, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **Crl.Rev.Pet.No. 927 of 2018** ## **ORDER** The revision petitioner is the 4[th] accused in C.C. No. 41 of 2011 on the files of the court of the Special Judge (SPE/CBI), Thiruvananthapuram . The offences alleged are punishable under Sections 120 B and 420 IPC and Section 13(1) (d) read with Section 13 (2) of the Prevention of Corruption Act (for short “the P.C. Act”) . 2. The prosecution allegation is that the petitioner entered into a criminal conspiracy with the other accused persons for the purpose of defrauding State Bank of Travancore, Kottayam Branch and for that purpose, the petitioner overvalued the properties of the 2[nd] and the 3[rd] accused. The petitioner filed Crl.M.P. No. 30 of 2014 before the court below under Section 239 Cr.P.C. praying for discharge. However, the court below as per order dated 11-6-2018 dismissed the said petition against which this Criminal Revision Petition has been filed. ## **Crl.Rev.Pet.No. 927 of 2018** -3- ## 3. Heard. 4. The sum and substance of the allegations of the prosecution is that the petitioner overvalued the properties of the 2[nd] and the 3[rd] accused and persuaded the bank to advance the loan on the strength of the said properties and thereby the petitioner took part in the conspiracy with the other accused to defraud the bank. As per the report submitted by the petitioner, two properties in Mundakkayam were valued at Rs. 25,000/- per cent. CW26 filed a report which is appended to the final report as D211. The said report would show that the said property was valued at Rs. 4000/- per cent. The petitioner valued the building of the factory of M/s. Sukhamai Tea (P) Ltd. at Rs. 29,68,700/- eventhough CW16 valued the said property at Rs. 18,93,273/- as per D48 appended to the final report. The plant and machinery supplied by M/s. K.S. Engineering Works, Kodannore had been assessed at Rs. 57,80,000/- by the petitioner whereas the said property ## **Crl.Rev.Pet.No. 927 of 2018** -4- had been valued at Rs. 31,00,000/- by CW18 as per his reports. In the same way, the electrical installations, diesel generators, motors and the factory were valued at Rs. 20,75,000/-by the petitioner whereas CW6 valued the said properties at 15.5 lakhs. 5. The learned counsel for the revision petitioner has argued that since the revision petitioner was a person coming within the category of professionals, no prosecution against the revision petitioner on the strength of the report of valuation submitted by him can be sustained. The learned counsel relied on the decision of the Apex Court in Central Bureau of Investigation v. Narayana Rao [2012 (4) KLT 92 (SC)] to butter his argument. 6. In Narayana Rao (supra), the Apex Court held in paragraph 22 thus:- “In the banking sector in particular, rendering of legal opinion for granting of loans has become ## **Crl.Rev.Pet.No. 927 of 2018** -5- an important component of an advocate's work. In the law of negligence, professionals such as lawyers, doctors, architects and others are included in the category of persons professing some special skills.” 7. The Apex Court further held that the liability against an opining advocate arises only when the lawyer was an active participant in a plan to defraud the Bank. The Apex Court further held in paragraph 23 thus:- “The only assurance which such a professional can give or can be given by implication is that he is possessed of the requisite skill in that branch of profession which he is practising and while undertaking the performance of the task entrusted to him, he would be exercising his skill with reasonable competence. This is what the the person approaching professional can expect. Judged by this standard, a professional may be held liable for negligence on one of the two findings, viz., either he was not possessed of the requisite skill which he professed ## **Crl.Rev.Pet.No. 927 of 2018** -6- to have possessed, or, he did not exercise, with reasonable competence in the given case, the skill which he did possess.” 8. The Apex Court further held that if there is a link or evidence to connect a professional with the other conspirators for causing loss to the institution, undoubtedly, the prosecuting authorities are entitled to proceed under criminal prosecution. 9. In this case, eventhough CW26 had submitted a report valuing the property at Rs. 4000/- per cent, his report does not show the assessment of the value of the property on the basis of any scientific or legal method. The value of the adjacent properties having similar features were also not ascertained from the Sub Registrar's Office for fixing the valuation in this case. The valuation fixed by the court in any land acquisition proceedings, in respect of the property having similar features and located adjacent to the properties in question, was also not taken into ## **Crl.Rev.Pet.No. 927 of 2018** -7- consideration for fixing the value by CW26. So also, the valuation reports submitted by CW6, CW16 and CW18 also do not reveal that any scientific method was adopted in fixing the value of the properties. It is admitted by the Central Bureau of Investigation that the loan was sanctioned and disbursed before submitting the report of valuation by the petitioner. It is further stated in the counter that the petitioner was not an approved valuer of the bank. Therefore, it cannot be accepted that the report submitted by the petitioner was acted upon by the bank. It is true that if there is any link evidence to connect the petitioner with the other conspirators for causing loss to the bank, undoubtedly, the prosecuting authorities are entitled to proceed against the petitioner. However, such tangible materials are lacking against the petitioner in this case. 9. There is absolutely no material before the court apart from the reports submitted by CW6, CW16, CW18 and CW26 to connect the revision petitioner with the offences alleged. The reports were admittedly not ## **Crl.Rev.Pet.No. 927 of 2018** -8- prepared by CW6, CW16, CW18 and CW26 on the basis of any authenticated and acceptable method of valuation. 10. Therefore, on the strength of those reports, it would not be just and proper to prosecute the revision petitioner, who is a professional, in the absence of any link connecting the revision petitioner with the conspirators, particularly when the loan was sanctioned and disbursed prior to the filing of the valuation report by the revision petitioner. At the stage under Section 239 Cr.P.C., the court is required to evaluate the material and documents on record with a view to find out if the facts emerging therefrom taken at their face value disclose the existence of all the ingredients constituting the offences alleged. For this limited purpose, the court will sift the evidence as it cannot be expected even at that initial stage to accept all that the prosecution states as gospel truth, even if it is opposed to common sense or the broad probabilities of the case. (See Central Bureau of Investigation v. Narayana ## **Crl.Rev.Pet.No. 927 of 2018** -9- ## Rao [2012 (4) KLT 92 (SC)]. 11. In this case, the reports submitted by CW6, CW16, CW18 and CW26 were not prepared on the basis of any legally acceptable method and hence it may not be justified to prosecute a professional on the basis of the said reports. So also, the revision petitioner was not the approved valuer of the bank. If at all the valuation conducted by the revision petitioner is found to be wrong, that itself will not make the revision petitioner liable to be prosecuted for the offences alleged in the absence of any tangible material to connect the revision petitioner with the conspirators. Since there is no link or evidence to connect the revision petitioner with the other conspirators for causing loss to the bank, no purpose will be served even if the prosecution against the revision petitioner is permitted to be continued. Since tangible materials are lacking in this case to connect the revision petitioner with the offences alleged, it cannot be said that there is _prima facie_ case for proceeding against the revision petitioner and hence, this Court considers that the ## **Crl.Rev.Pet.No. 927 of 2018** charge against the revision petitioner is groundless. Consequently, the order impugned cannot be sustained. In the result, this revision petition stands allowed and the order impugned stands set aside and the revision petitioner stands discharged. The observations made by this Court in this order shall not be construed as expression on the merits of the case as the said observations are intended only for the purpose of disposing of this revision petition. Dated this the 11[th] day of October, 2017. **Sd/-B. SUDHEENDRA KUMAR, JUDGE** . /true copy/ ani/26/11