LexR. VENKATAKRISHNAN versus CENTRAL BUREAU OF INVESTIGATION
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[2009J 12 S.C.R. 762 A R. VENKATAKRISHNAN - ' Ir v. CENTRAL BUREAU OF INVESTIGATION (Criminal Appeal No.76 of 2004) : B AUGUST 7, 2009 [S.8. SINHA AND CYRIAC JOSEPH, JJ.] SPECIAL COURT (TRIAL OF OFFENCES RELATING --1 • TO TRANSACT/ON IN SECURITIES) ACT, 1992: c ss. 2(c), 3(2) and 7 - 'Call money' scam - Jurisdiction of Special Court - A huge sum belonging to a Scheduled Bank diverted as 'call money' by officials of Banks concerned to the .. account of a broker in securities - HELD: "Call money" D transactions are banking transactions - The transaction in question was shown as 'call money' transaction and, therefore, 'r ... it could not have been used for any other purpose - The act of illegally diverting the money belonging to National Housing Bank to the account of the broker during the period E specified in s. 3(2) so as to enable him to enter into transactions in securities, was an offence triable exclusively by Special Court, which rightly exercised the jurisdiction - Interpretation of statute - Mischief rule - Liberal construction. • ss. 2(c) and 3(2) - Expressions 'securities' and 'offences F relating to transactions in securities' - Connotation of NATIONAL HOUSING BANK ACT, 1987: s. 14 - Violation of - HELD: Advancing of loan to an G individual under the disguise of 'call money' transaction is an offence under the Act and illegal in terms of s.43 /PC - Penal Code, 1860 - s.43. PENAL CODE, 1860: H 762 - ' . R. VENKATAKRISHNAN v. CENTRAL BUREAU OF 76.3 INVESTIGATION ss. 120-B, 405 and 409 - Criminal conspiracy, and A criminal breach of trust by public servants - Employees of Scheduled Banks, in connivance with a broker and his associate diverting in the guise of "call money" a huge sum belonging to the Bank to the account of the broker - HELD: Even if the Banks may not have suffered ultimate loss, but if B money has been allowed to be used il/egal/y/for illegal purpose, s. 405 would get attracted - Temporary embezzlement would also attract s.405 - The charges having been established, the Bank officials, except A-7, were rightly convicted of offences of criminal conspiracy and criminal c breach of trust - The employee of the broker was rightly convicted of offence of criminal conspiracy - A-7 acquitted. ss. 405 and 409 - Criminal breach of trust - Complainant - HELD: Where public money is involved, criminal law can be set in motion by anybody- In the instant case, prosecution D was rightly initiated on the basis of the information received by CBI. ss:23, 24 and 43- 'Wrongful gain' - 'Dishonestly' -'Illegal' - Connotation of. E PREVENTION OF CORRUPTION ACT, 1988: • ss. 13(1)(d)(iii) r!w s.13(2) - Criminal misconduct - 'call )(- money' scam - Officials of Scheduled Banks - In connivance with a broker and his employee diverting in the guise of "call F money" huge sum belonging to the Bank to the account of the broker - HELD: Accused were guilty of criminal misconduct u/s 13(1)(d)(iii). ss. 19(1) and 19(3) - Sanction for prosecution of public ' G servant - Official of RBI absorbed in National Housing Bank - Proceedings against him to be initiated for various criminal offences - Sanction by officer of NHB - HELD: Authority concerned was competent to pass the order of sanction - Even otherwise, there has been no failure of justice because of any H 764 SUPREME COURT REPORTS (2009] 12 S.C.R. A alleged error in the orders of sanction. ~ "" SENTENCE/SENTENCING: Awarding of sentence - Factors to be taken into B consideration - Explained - "Call money" scam - Special Court, while awarding the sentence to one of the accused, placing reliance on 'Jankiraman Committee' Report - HELD: Special Court acted illegally and without jurisdiction - The said report was not admissible in evidence - There being IJ.tide difference in sentence imposed on the accused concemed "' ' c and other accused persons, his sentence reduced to six months - Sentences imposed on other accused, except the one who has been acquitted, not interfered with - Evidence - Committee's Report - Admissibility in evidence. D WORDS AND PHRASES: Expressions 'call money', 'dishonestly', 'illegal', 'in relation f ... to', 'offence relating to transactions in securities', 'securities', - and 'wrongful gain' - Connotation of. E Appellant-accused-1, the Chairman and Managing Director of UCO Bank, appellant-accused-2, its General Manager, appellant-accused-3, the Divis
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