Delhi High Court
Vikas Garg & Anr vs The State Through Central Bureau Of … on 17 February, 2026
* I N T H E H I G H CO U RT O F DE L H I AT NE W DE L H I
Reserved on: January 13, 2026
% Pronounced on: February 17, 2026
+ CRL.M.C. 6496/2022, CRL.M.A. 25285/2022
VIKAS GARG & ANR. .....Petitioners
Through: Mr. Naman Gupta, Ms. Mansi Goyal,
Advocates.
Versus
THE STATE THROUGH CENTRAL BUREAU OF
INVESTIGATION .....Respondent
Through: Mr. Anuram S. Sharma, SPP for CBI
alongwith Ms. Harpreet Kalsi, Mr.
Vashisht Rao, Mr. Ripudaman
Sharma, Ms. Riya Sachdeva and Ms.
Amisha, Advs.
CORAM:
HON'BLE MR. JUSTICE SAURABH BANERJEE
JUDGMENT
1. By way of the present petition under Section 482 read with Section 397
of the Code of Criminal Procedure1, the petitioners seek setting aside of the
order dated 07.09.2022 passed by the learned Special Judge (PC Act) (CBI)-
07, Rouse Avenue Court, New Delhi2 in CC No.375/2019 whereby charges
were framed against the petitioners under Section 120B read with Sections
1 Hereinafter referred to as ‘Cr.P.C.’
2
Hereinafter referred to as ‘Trial Court’.
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420/468/471 of the Indian Penal Code3 and under Section 13(2) read with
Section13(1)(d) of the Prevention of Corruption Act.
2. An FIR bearing no.RC-09/A/2017 dated 21.06.2017 came to be
registered on the basis of written complaint of one Sh. S.K. Mehta, Deputy
General Manager, Corporation Bank, Zonal Office, Delhi (South)4, wherein it
was alleged that in March 2013, one Sumit Mittal, projecting himself to be
the proprietor of M/s. Shree Balaji Overseas5, approached the Bank seeking
working capital finance of Rs.600 lakhs. The said loan proposal was
sanctioned by the Bank on 19.04.2013, stipulating hypothecation of stock-in-
trade and EMG of property bearing no.A-68, measuring 138.17 sq. mtrs.,
situated at Pushpanjali Enclave, Pitampura, Delhi, in the name of Sh. Sat
Narayan Mittal. Pursuant thereto, on 26.04.2013, the Vasant Kunj branch of
the Bank disbursed a Corp. Vyapar Loan of Rs.600 lakhs to the account of
the borrower firm.
3. It was further alleged that during inspection of the said loan account
certain suspicion arose which led the Bank to initiate an internal inquiry
which disclosed various serious irregularities. It was found that the loan was
applied on the basis of forged and fabricated documents, which were not
verified before sanctioning of the loan. The title documents of the property
which was offered as collateral were also found to be fabricated. The said
loan was sanctioned in violation of various Circulars and Guidelines.
4. During the course of investigation, it emerged that the borrower firm
3 Hereinafter referred to as ‘IPC‘.
4 Hereinafter referred to as ‘Bank’.
5
Hereinafter referred to as ‘borrower firm’.
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and its proprietor were fictitious/ non-existent. It was further revealed that the
said Sumit Mittal, along with certain senior Bank officials at the Vasant Kunj
Branch, CCPC and ZLCC, Delhi (South), and other private person, including
the petitioners, had entered into criminal conspiracy to unlawfully get a loan
of Rs. 600 lakhs sanctioned on the basis of false and fabricated documents.
5. The petitioner no.2, through its authorised signatory petitioner no.1
were engaged by the Bank as a due diligence agency and were entrusted with
the physical as well as financial due diligence of the loan applicants. The
petitioners, without undertaking any genuine physical or financial
verification, have deliberately issued a favourable Due Diligence Report
dated 29.03.20136 in respect of Sumit Mittal and its firm M/s. Shree Balaji
Overseas so as to facilitate sanction of the loan.
6. Thereafter, with the aforesaid findings, chargesheet dated 25.03.2019
was filed and vide order dated 07.09.2022 charges were framed against the
petitioners. Aggrieved by the same, the petitioners have approached this
Court by way of the present petition.
7. Mr. Naman Gupta, learned counsel for the petitioners advanced his
submissions and contended that:-
i. the petitioner no.2 was empanelled as a due diligence agency by
the Bank in the year 2012 and since then the petitioners have diligently
conducted more than 1100 due diligences of various borrowers of the
Bank;
ii. there was neither any material in the entire chargesheet to link
6 Hereinafter referred to as ‘Report’.
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the petitioners with the other co-accused persons in the alleged
conspiracy nor was there any meeting of minds shown by the
prosecution nor any material to indicate active participation by the
petitioners in furtherance of such conspiracy;
iii. there was no material or allegations to suggest that the
petitioners were involved in manipulation, creation, or fabrication of
any document, as also, even no monetary or other benefit is alleged or
shown to have accrued to the petitioners;
iv. the petitioners prepared the Report strictly on the basis of
information and documents supplied by the Bank and the borrower;
v. the sole allegation against the petitioners is limited to the extent
of alleged failure to verify the documents such as bank statements,
income tax returns, and property details which does not fall within the
scope of work of the petitioners as per the terms of empanelment; the
petitioners were neither required nor authorised to conduct a forensic
audit or to assess the genuineness of the documents, nor did they
possess any power to summon records from banks or statutory
authorities, even otherwise, the verification of title deeds of the
property was the responsibility of independent professionals appointed
by the Bank; with respect to income tax returns, the due diligence
report clearly recorded that the Income Tax user ID and password were
not made available to the petitioners and had the Bank examined the
Report with due care, the loan would not have been sanctioned;
vi. the photographs shown in the Report shows that site visits were
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carried out by the petitioners’ employee and the petitioners had no
occasion to doubt that such visits had not been undertaken; that the
alleged failure or lapse on the part of an employee, if any, in visiting
the sites cannot be attributed to the petitioners, much less in the
absence of any material otherwise;
vii. the learned Trial Court failed to appreciate that the due diligence
report relied upon by the Bank at the stage of sanction was incomplete
and different from the Report actually submitted by the petitioners;
viii. the learned Trial Court while framing the charges against the
petitioners had failed to consider that in the entire chargesheet there is
not even an iota of evidence to establish any criminal liability on the
part of the petitioners, much less for framing the charges under Section
120B read with Sections 420/468/471 IPC and Section 13(2) read with
Section 13(1)(d) of the Prevention of Corruption Act; and
ix. the petitioners have been discharged in several other cases
involving similar allegations.
8. To buttress his aforesaid submissions, Mr. Naman Gupta, learned
counsel for the petitioners placed reliance upon Union of India v. Prafulla
Kumar Samal & Anr.7, CBI v. K. Narayana Rao8, Ganesh v. The
Superintendent of Police9, Sunil Bharti Mittal v. CBI10, Union of India v.
7
AIR 1979 SC 366,
8
(2012) 9 SCC 512
9
Crl. M.P. No. 14145 of 2017 (Madras High Court)
10
AIR 2015 SC 923; (2015) 4 SCC 609
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R.N. Rajam Iyer & Ors.11, In re Kingston Cotton Mill Co. (No. 2)12, In re
London and General Bank (No. 2)13 and Aneeta Hada v. Godfather Travels
& Tours Pvt. Ltd.14.
9. Controverting the aforesaid submissions, Mr. Anuram S. Sharma,
learned SPP for CBI submitted that:-
i. Due Diligence Report dated 29.03.2013 was submitted under the
signature of petitioner no.1 which contains gross misrepresentations of
material facts, particularly with respect to site verification and scrutiny
of financial documents. In fact, the said Report claims that PW-14,
Finance Executive of petitioner no.2, conducted physical verification
of the borrower’s sites, whereas PW-14, in his statement under Section
161 Cr.P.C., while admitting the signatures of petitioner no.1 on the
Report, categorically denied having conducted any physical
verification; this, prima facie, establishes collusion and connivance of
the petitioners with the other co-accused persons in cheating the Bank
of substantial public funds;
ii. though the petitioners are claiming that Income Tax Returns
could not be verified due to non-availability of login credentials,
however, the Report is ex facie contradictory as under the heading
“Records of Originals Verified”, the Report affirmatively records
verification of Income Tax Returns, which directly contradicts the
11
AIR 1964 Mad 398
12 (1896) 2 Ch 279
13 (1895) 2 Ch 673
14
AIR 2012 SC 2795
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petitioners’ own stand;
iii. it is not the Bank relied upon an incomplete Report at the time
of sanction, and even otherwise the very existence of purported two
Reports points towards a larger conspiracy involving the petitioners
and the other co-accused; in any event, it is not in dispute that the
petitioners authored and signed a document which was materially false,
since PW-14 admittedly never conducted any physical inspection;
iv. conspiracy by its very nature is clandestine and is seldom proved
by direct evidence and for establishing an offence under Section 120B
of the IPC, proof of overt acts by each conspirator is not required; it is
sufficient to show that the accused was a party to an agreement to
commit an offence and performed any act in furtherance thereof; the
petitioners submitted a false Report fully satisfies the above
requirement; and
v. at the stage of Sections 227 and 228 Cr.P.C., the Court is only
required to assess whether the material on record gives rise to grave
suspicion against the accused, as a meticulous appreciation of evidence
is impermissible. The learned Trial Court has rightly found sufficient
ground to proceed against the petitioners under Section 228 Cr.P.C.
10. This Court has heard the counsel for the petitioners and the learned
SPP and perused the documents on record along with the judgements cited
therewith.
11. Chapter XVIII of the Cr.P.C. sets out the procedure for trial before the
Court of Sessions. Section 225 of the Cr.P.C. makes the public prosecutor in
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charge to conduct the prosecution, who, as per Section 226 of the Cr.P.C.
opens the case of prosecution by describing the charge against the accused
and stating the evidences by which the prosecution proposes to establish the
guilt of the accused. Once that is done, the Court is thereafter required to
consider whether the accused is liable to be discharge in terms of Section
22715 of the Cr.P.C. or whether the charges are to be framed against him
under Section 228 of the Cr.P.C.16.
12. A joint reading of Sections 227 and 228 of Cr.P.C. reveal that while
undertaking such consideration, the Court is required to examine the record
of the case and the documents received therewith, as also hear the
submissions on behalf of the accused and the prosecution, and then pose to
itself a question as to whether there is sufficient ground for proceeding
15
227. Discharge.-If, upon consideration of the record of the case and the
documents submitted therewith, and after hearing the submissions of the accused
and the prosecution in this behalf, the Judge considers that there is not sufficient
ground for proceeding against the accused, he shall discharge the accused and
record his reasons for so doing.
16
228. Framing of charge.–(1) If, after such consideration and hearing as
aforesaid, the Judge is of opinion that there is ground for presuming that the
accused has committed an offence which–
(a) is not exclusively triable by the Court of Session, he may, frame a charge
against the accused and, by order, transfer the case for trial to the Chief
Judicial Magistrate, [or any other Judicial Magistrate of the first class and
direct the accused to appear before the Chief Judicial Magistrate, or, as the
case may be, the Judicial Magistrate of the first class, on such date as he
deems fit, and thereupon such Magistrate] shall try the offence in
accordance with the procedure for the trial of warrant-cases instituted on a
police report;
(b) is exclusively triable by the Court, he shall frame in writing a charge
against the accused.
(2) Where the Judge frames any charge under clause (b) of sub-section (1), the
charge shall be read and explained to the accused and the accused shall be asked
whether he pleads guilty of the offence charged or claims to be tried.
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against the accused. If the Court finds the answer is in negative then the
accused is liable to be discharged under Section 227 of the Cr.P.C., but where
the Court finds there is ground for presuming that the accused has committed
an offence, the Court shall proceed to frame charge under Section 228 of the
Cr.P.C.
13. Relevantly, at the stage of framing of charges, the purpose of the
inquiry is not to arrive at the conclusion whether the proceedings are likely to
lead to a conviction, as that is left for trial, and as the Court has only to prima
facie consider whether there is a sufficient ground for proceeding against the
accused and for the said limited purpose the Court may sift the evidence.
Sometimes, even a remote link between the activities of an accused and the
facts of the case are sufficient justification for a reasonable inference
warranting a judicial finding that there is a ground for presuming that the
accused has committed the offence or at least for a presumption that he is
(in)directly involved in the commission of the offence. It is noteworthy that
the presumption, at this stage, is not a presumption of law, rather the only
purpose of drawing such presumption is prima facie for deciding adoption of
the course of trial.
14. Interestingly, the Hon’ble Supreme Court in Amit Kapoor v. Ramesh
Chander 17, while considering the scope of Sections 227 and 228 of the
Cr.P.C. has held as under:-
“17. Framing of a charge is an exercise of jurisdiction by the trial
court in terms of Section 228 of the Code, unless the accused is17
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discharged under Section 227 of the Code. Under both these
provisions, the court is required to consider the “record of the case”
and documents submitted therewith and, after hearing the parties,
may either discharge the accused or where it appears to the court and
in its opinion there is ground for presuming that the accused has
committed an offence, it shall frame the charge. Once the facts and
ingredients of the section exists, then the court would be right in
presuming that there is ground to proceed against the accused and
frame the charge accordingly. This presumption is not a presumption
of law as such. The satisfaction of the court in relation to the existence
of constituents of an offence and the facts leading to that offence is a
sine qua non for exercise of such jurisdiction. It may even be weaker
than a prima facie case. There is a fine distinction between the
language of Sections 227 and 228 of the Code. Section 227 is the
expression of a definite opinion and judgment of the Court while
Section 228 is tentative. Thus, to say that at the stage of framing of
charge, the Court should form an opinion that the accused is certainly
guilty of committing an offence, is an approach which is
impermissible in terms of Section 228 of the Code.
***
19. At the initial stage of framing of a charge, the court is
concerned not with proof but with a strong suspicion that the accused
has committed an offence, which, if put to trial, could prove him
guilty. All that the court has to see is that the material on record and
the facts would be compatible with the innocence of the accused or
not. The final test of guilt is not to be applied at that stage. We may
refer to the well-settled law laid down by this Court in State of
Bihar v. Ramesh Singh [State of Bihar v. Ramesh Singh, (1977) 4 SCC
39 : 1977 SCC (Cri) 533] : (SCC pp. 41-42, para 4)
‘4. Under Section 226 of the Code while opening the case
for the prosecution the Prosecutor has got to describe the
charge against the accused and state by what evidence he
proposes to prove the guilt of the accused. Thereafter comes at
the initial stage the duty of the court to consider the record of
the case and the documents submitted therewith and to hear the
submissions of the accused and the prosecution in that behalf.
The Judge has to pass thereafter an order either under Section
227 or Section 228 of the Code. If “the Judge considers that
there is no sufficient ground for proceeding against the accused,
he shall discharge the accused and record his reasons for so
doing”, as enjoined by Section 227. If, on the other hand, “the
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Judge is of opinion that there is ground for presuming that the
accused has committed an offence which-… (b) is exclusively
triable by the court, he shall frame in writing a charge against
the accused”, as provided in Section 228. Reading the two
provisions together in juxtaposition, as they have got to be, it
would be clear that at the beginning and the initial stage of the
trial the truth, veracity and effect of the evidence which the
Prosecutor proposes to adduce are not to be meticulously
judged. Nor is any weight to be attached to the probable defence
of the accused. It is not obligatory for the Judge at that stage of
the trial to consider in any detail and weigh in a sensitive
balance whether the facts, if proved, would be incompatible with
the innocence of the accused or not. The standard of test and
judgment which is to be finally applied before recording a
finding regarding the guilt or otherwise of the accused is not
exactly to be applied at the stage of deciding the matter under
Section 227 or Section 228 of the Code. At that stage the court is
not to see whether there is sufficient ground for conviction of the
accused or whether the trial is sure to end in his conviction.
Strong suspicion against the accused, if the matter remains in
the region of suspicion, cannot take the place of proof of his
guilt at the conclusion of the trial. But at the initial stage if there
is a strong suspicion which leads the court to think that there is
ground for presuming that the accused has committed an offence
then it is not open to the court to say that there is no sufficient
ground for proceeding against the accused. The presumption of
the guilt of the accused which is to be drawn at the initial stage
is not in the sense of the law governing the trial of criminal
cases in France where the accused is presumed to be guilty
unless the contrary is proved. But it is only for the purpose of
deciding prima facie whether the court should proceed with the
trial or not. If the evidence which the Prosecutor proposes to
adduce to prove the guilt of the accused even if fully accepted
before it is challenged in cross-examination or rebutted by the
defence evidence, if any, cannot show that the accused
committed the offence, then there will be no sufficient ground for
proceeding with the trial. An exhaustive list of the circumstances
to indicate as to what will lead to one conclusion or the other is
neither possible nor advisable. We may just illustrate the
difference of the law by one more example. If the scales of pan
as to the guilt or innocence of the accused are something like
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even at the conclusion of the trial, then, on the theory of benefit
of doubt the case is to end in his acquittal. But if, on the other
hand, it is so at the initial stage of making an order under
Section 227 or Section 228, then in such a situation ordinarily
and generally the order which will have to be made will be one
under Section 228 and not under Section 227.'”
15. The Hon’ble Supreme Court has also laid down the guiding principles
which this Court has to be borne in mind while quashing of a charge/
proceedings either in exercise of jurisdiction under Section 397 Cr.P.C. or
Section 482 Cr.P.C. or together, as the case may be, therein as under:-
“27. … …27.1. Though there are no limits of the powers of the Court
under Section 482 of the Code but the more the power, the more due
care and caution is to be exercised in invoking these powers. The
power of quashing criminal proceedings, particularly, the charge
framed in terms of Section 228 of the Code should be exercised very
sparingly and with circumspection and that too in the rarest of rare
cases.
27.2. The Court should apply the test as to whether the
uncontroverted allegations as made from the record of the case and
the documents submitted therewith prima facie establish the offence or
not. If the allegations are so patently absurd and inherently
improbable that no prudent person can ever reach such a conclusion
and where the basic ingredients of a criminal offence are not satisfied
then the Court may interfere.
27.3. The High Court should not unduly interfere. No meticulous
examination of the evidence is needed for considering whether the
case would end in conviction or not at the stage of framing of charge
or quashing of charge.
27.4. Where the exercise of such power is absolutely essential to
prevent patent miscarriage of justice and for correcting some grave
error that might be committed by the subordinate courts even in such
cases, the High Court should be loath to interfere, at the threshold, to
throttle the prosecution in exercise of its inherent powers.
27.5. Where there is an express legal bar enacted in any of the
provisions of the Code or any specific law in force to the very
initiation or institution and continuance of such criminal proceedings,
such a bar is intended to provide specific protection to an accused.
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27.6. The Court has a duty to balance the freedom of a person and the
right of the complainant or prosecution to investigate and prosecute
the offender.
27.7. The process of the court cannot be permitted to be used for an
oblique or ultimate/ulterior purpose.
27.8. Where the allegations made and as they appeared from the
record and documents annexed therewith to predominantly give rise
and constitute a “civil wrong” with no “element of criminality” and
does not satisfy the basic ingredients of a criminal offence, the court
may be justified in quashing the charge. Even in such cases, the court
would not embark upon the critical analysis of the evidence.
27.9. Another very significant caution that the courts have to observe
is that it cannot examine the facts, evidence and materials on record
to determine whether there is sufficient material on the basis of which
the case would end in a conviction; the court is concerned primarily
with the allegations taken as a whole whether they will constitute an
offence and, if so, is it an abuse of the process of court leading to
injustice.
27.10. It is neither necessary nor is the court called upon to hold a
full-fledged enquiry or to appreciate evidence collected by the
investigating agencies to find out whether it is a case of acquittal or
conviction.
27.11. Where allegations give rise to a civil claim and also amount to
an offence, merely because a civil claim is maintainable, does not
mean that a criminal complaint cannot be maintained.
27.12. In exercise of its jurisdiction under Section 228 and/or under
Section 482, the Court cannot take into consideration external
materials given by an accused for reaching the conclusion that no
offence was disclosed or that there was possibility of his acquittal. The
Court has to consider the record and documents annexed therewith by
the prosecution.
27.13. Quashing of a charge is an exception to the rule of continuous
prosecution. Where the offence is even broadly satisfied, the Court
should be more inclined to permit continuation of prosecution rather
than its quashing at that initial stage. The Court is not expected to
marshal the records with a view to decide admissibility and reliability
of the documents or records but is an opinion formed prima facie.
27.14. Where the charge-sheet, report under Section 173(2) of the
Code, suffers from fundamental legal defects, the Court may be well
within its jurisdiction to frame a charge.
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27.15. Coupled with any or all of the above, where the Court finds
that it would amount to abuse of process of the Code or that the
interest of justice favours, otherwise it may quash the charge. The
power is to be exercised ex debito justitiae i.e. to do real and
substantial justice for administration of which alone, the courts exist.
***
27.16. These are the principles which individually and preferably
cumulatively (one or more) be taken into consideration as precepts to
exercise of extraordinary and wide plenitude and jurisdiction under
Section 482 of the Code by the High Court. Where the factual
foundation for an offence has been laid down, the courts should be
reluctant and should not hasten to quash the proceedings even on the
premise that one or two ingredients have not been stated or do not
appear to be satisfied if there is substantial compliance with the
requirements of the offence.”
16. As such, this Court has to be circumspect and extremely careful while
it is dealing with quashing of charges. Generally, once a charge has been
framed, the prosecution must be permitted to proceed with the trial for taking
things to their logical conclusion. Interference, at this stage, is warranted only
in rare and exceptional cases, wherein even if the entire material placed by
the prosecution is accepted at face value, no offence is made out, or where
continuation of the proceedings would amount to a patent abuse of the
process of the Court or result in grave miscarriage of justice.
17. A perusal of the records herein reveal that the petitioners were
empanelled by the Bank as a due diligence agency and were entrusted with
the crucial responsibility of conducting both physical and financial due
diligence of the borrowers/ loan applicants. The terms of their empanelment
along with the Bank’s H.O. Circular No.730/2008 dated 19.08.2008 were
very clear and specific, which leaves no doubt in the mind of this Court that
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what is sought to be argued by the petitioners is not what is contained therein.
For ease of reference, the essential terms thereof are reproduced as under:-
“On receipt of applications by the Branch [in case processing is done at
the branch] or by the SME processing Cell, as may be the case, the
applications would be verified for completeness and check for existence
of support documents. Action plan would be drawn for field level credit
investigation.
The due diligence exercise would be conducted in two stages:
l. Physical Due diligence
2. Financial Due diligence
PHYSICAL DUE DILIGENCE:
The intention of conducting physical due diligence is to eliminate
undesirable cases at the initial stage itself and helps in efficient
utilisation of management’s time for focussing on quality clients. This
would also facilitates detection of organised / group frauds etc.The objectives of conducting physical due diligence are as under:
To properly establish the identity of the persons, who have approached
for Bank finance.
To weed out all unscrupulous, not trust worthy persons from availing
bank finance
To form an independent opinion on the integrity, standing of the
persons, who have approached for Bank Finance
To ensure that persons are genuine and committed for the cause of the
business they are dealing in
To ensure that they are residing in the place for long
The properties / securities offered are genuine and they are the real
owners of those properties
To meet supplier/ customer of the applicant to get market reportTo conduct physical due diligence and arrive at the above conclusions.
“Residence Verification Report and “Business verification Report” would
be prepared by the outside professionals based on the set questionnaire.
The neighbourhood check would also be conducted to corroborate their
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the given address and persons are genuine. The persons standard of
living and residential status (ownership / rented etc) / business status
would also be verified. This check would eventually climinale cases of
fraud and bank can ensure the safety of money lent.
If the overall observation in this regard is satisfactory, the proposal shall
be taken up for financial due diligence. As otherwise, the proposal to be
declined.
FINANCIAL DUE DILIGENCE:
The objective of conducting financial due diligence are as under:
To get an independent opinion about the financial position of the units
sought to be financed.
To read beyond the Balance Sheet, and to know the true financial
position of the unit and its implications on the future borrowing
programme, sought to be financed
To know the liquidity and solvency position of the units
To know their banking operations – track record of their dealings
To ensure that the payment track record of these units to its suppliers /
from its customers are reasonably good and money can be lent to them –
whether payments are made promptly and receivables are realised in
time. The quality of its debtors and creditors would be known to a larger
extent.
For double-checking the facts and figures furnished by these units and
an independent opinion is formed before committing bank’s funds.
To ensure that the unit is statutory compliant with regard to payment of
sales tax / VAT. Service Tax, Excise (if applicable), PF, ESI, Unit is
approved by the Pollution Control BoardThe process will eventually rule out the mistakes or mischief in
identification & sanction of SME proposals, as an independent opinion
on the credibility and viability of the proposal is received from an expert
in the field. The financial due diligence is expected to ease the pressure of
branch officials and pre-sanction visit would become more meaningful.”
18. As apparent therefrom, the same casted/ imposed a positive duty upon
the petitioners to independently verify and form a considered opinion
regarding the genuineness of the borrower’s identity/ integrity/ market
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By:BABLOO SHAH
Signing Date:17.02.2026
15:45:50
standing/ financial position for preparation of their Report. Therefore, it is
hard to believe that the petitioners were only expected to merely rely upon
the documents supplied by the Bank or the borrower. The petitioners were
not dealing as/ with a fly by night operator. As such, the role of the
petitioners and the Report submitted by them assumed substantial
significance in consideration and sanction of the loan proposal.
19. Prima facie, as emerging from the chargesheet, despite being entrusted
with the aforesaid positive duty, significantly the petitioners failed to raise
any concern about (i) the non-existence of the borrower firm and its
proprietor or (ii) the false and fabricated documents submitted by the
borrower firm or (iii) the purported clients of the borrower firm being bogus
as they submitted a favourable Report containing material misrepresentation,
and based whereon the Bank proceeded to sanction the loan. Notably, though
the said Report claimed that the site verification was conducted by Sh.
Narender Singh, however, he in his Section 161 of the Cr.P.C. statement, has
categorically denied any such physical inspection or preparing any such
Report. In fact, he has gone onto state that the photographs of the site
appearing in the Report were identical to those in the due diligence report of
another entity, namely SN Trading Co. Moreover, although the Report of the
petitioners recorded that Income Tax User ID and password were not made
available for verification of ITRs, however, surprisingly the petitioners have
themselves affirmatively recorded verification of Income Tax Returns under
the heading “Records of Originals Verified”.
20. As such in view of the positive Report submitted by the petitioners
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Signing Date:17.02.2026
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despite the glaring irregularities and contradictions, there arises grave
suspicion regarding involvement of the petitioners in the alleged offence and
which can be only tested in trial and thus this Court, at this stage, not deems
it appropriate to interfere with the charges framed by the learned Trial Court
vide the impugned order dated 07.09.2022.
21. Accordingly, the present petition, along with pending applications, is
dismissed. No order as to costs.
22. Needless to say, observations made on the merits of the matter, if any,
are only for the purposes of deciding the present petition and shall not be
construed as expressions on merits of the matter.
SAURABH BANERJEE, J.
FEBRUARY 17, 2026
Ab/GA
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Signature Not Verified
Digitally Signed
By:BABLOO SHAH
Signing Date:17.02.2026
15:45:50
