Interim Order 45

Order Details: COPY OF ORDER
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CBI vs. SURESH KUMAR GUPTA & ORS. Page No. 1 of 12
CC NO. CBI/18/2023
RC-220/2020/E0015
CBI VS. SURESH KUMAR GUPTA & ORS.
30.06.2026
ORDER ON CHARGE
1. Vide this order I shall decide whether accused persons in
the present case deserves to be discharged or they are liable for
the charges to be framed against them for commission of
offences as alleged in the chargesheet and discharge application
filed on behalf of accused Chhaya Singhal.
2. The present FIR was registered on the written complaint
dated 13.07.2020 of Sh. Ved Prakash, AGM and Branch Head,
Bank of Baroda, Zonal Stressed Assets Recovery Branch
(ZOSARB), New Delhi regarding criminal conspiracy, cheating
and forgery by four different entities i.e. M/s Shri Sidhdata Ispat
Pvt. Ltd., M/s Govardhan Industries Pvt. Ltd., M/s Shri Sidhdata
Steel Tubes and M/s Shri Sudershan Tubes and their
Directors/partners. The present charge-sheet pertains to M/s Shri
Sidhdata Steel Tubes.
3. It has been alleged that the accused were not able to
maintain financial discipline and committed various defaults due
to which the repayment of principle and interest thereon became
irregular and classified as NPA in 2013-14. Thereafter,
SARFAESI proceedings were initiated and bank got realized the
securities by auctioning/selling the amount.
4. It has been alleged that Forensic Audit was conducted by
M/s M.K. Aggarwal and Company and in its report of July 2019,
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it has been disclosed that there is siphoning off money
sanctioned/disbursed by the bank causing wrongful loss to the
tune of Rs. 190.76 crores.
5. During investigation, it has been revealed that M/s Shri
Sudershan Tubes was a partnership firm with Suresh Kumar
Gupta (A-1) and Om Prakash Gupta as its partners. That the
ownership and control of all the said four companies was with
the members of same family or related to the family. However,
each of the four entities have their own individual identity,
separate constitutions, separate businesses and separate sanctions
of credit facilities from erstwhile Dena Bank (now Bank of
Baroda).
6. During investigation, it has been revealed that M/s Shri
Sudershan Tubes submitted a request letter dated 04.02.2009
alongwith required documents to the Bank for sanction of CCH
limit of Rs. 670 lakhs towards existing CCH of Rs. 500 lakhs.
The Dena bank (now Bank of Baroda) sanctioned the CCH limit
of Rs. 610 lakhs and disbursed on 31.03.2009 towards take over
of existing CCH limit from Punjab National Bank. A-1 further
submitted a request letter dated 25.03.2010 for enhancement of
CCH limit from Rs. 610 lakhs to Rs. 970 lakhs by declaring sales
of Rs. 3740.32 lakhs for financial year 2009-10 and showing
projected sales for financial year 2010-11 of Rs. 4322.50 lakhs.
7. During investigation, it has been revealed that A-1
enclosed a photocopy of PNB accounts statement for
confirmation alongwith letter dated 10.06.2010 which contained
fabricated entries in order to inflate the credit summation figures
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CBI vs. SURESH KUMAR GUPTA & ORS. Page No. 3 of 12
to justify its sales figures for financial year 2009-10. That on the
basis of forged and fabricated PNB bank statement, the Dena
Bank enhanced CCH limit upto Rs. 970 lakhs.
8. During investigation, it has been revealed that M/s Shri
Sudershan Tubes diverted Rs. 10 lakhs on 05.11.2009 to its sister
concern namely M/s Kamdhenu Metal Industries and the said
amount was further transferred in the account of A-1 on the same
date.
9. During investigation, it has been revealed that M/s Shri
Sudershan Tubes diverted Rs. 25 lakhs on 17.09.2010 to its sister
concern namely M/s Kamdhenu Metal Industries and the said
amount was further transferred equally i.e. Rs. 12,50,000/- each
in the account of Rajat Gupta (A-4) and Pradeep Kumar Gupta
(A-3) on the same date.
10. During investigation, it has been revealed that M/s Shri
Sudershan Tubes diverted Rs. 31 lakhs on 14.09.2010 to its sister
concern namely M/s Govardhan Steels and the said amount was
further transferred in the account of Rajesh Kumar Gupta (A-2)
on the same date.
11. During investigation, it has been revealed that M/s Shri
Sudershan Tubes diverted Rs. 9 lakhs and Rs. 5 lakhs on
26.12.2011 and 28.12.2011 respectively to its sister concern
namely M/s Synergy India Pvt. Ltd. (A-5) and the said amount
was further transferred in the account of M/s Govardhan
Industries on the same date. During investigation, it has been
transpired that the Director of A-5 namely Vipul Gupta (A-7)
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was an active party to the criminal conspiracy to cheat the bank
and was hand in glove with other director A-4 and accepted
siphoned off funds.
12. During investigation, it has been revealed that M/s Shri
Sudershan Tubes diverted Rs. 444.80 lakhs to a proprietorship
firm of M/s Chhaya Singhal (A-6) namely M/s Iskcon Steels. It
is further transpired that forged and fabricated documents were
created to show the genuine business transactions. The goods
have been shown to be transported through 18 invoices and
during investigation, it has been transpired that out of 18
instances, in 14 instances two-wheeler vehicles is mentioned; in
3 instances three-wheeler vehicles is mentioned and in one
instance a car is mentioned, which have been used to transport
the goods, which is impossible.
13. After culmination of investigation, instant charge-sheet
was filed. Arguments on the point of charge on behalf of all the
parties were heard.
14. Ld. PP for the CBI had submitted that considering the facts
and the role of the accused persons it is clear that offences as
mentioned in the charge sheet were committed by them for which
they are liable to be charged. It was also submitted that it is not a
case where they are entitled to be discharged.
15. On the other hand, it is argued by Ld. counsel for accused
persons that the present complaint is solely on the basis of
findings of forensic auditor appointed by the Bank and accused
persons were never heard to explain about their finances and
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reasons of turning their account as NPA which is against the
principles of natural justice. Ld. counsel for accused persons
relied upon judgments on Hon'ble Supreme Court of India in
'State Bank of India & Ors. vs. Rajesh Aggarwal & Ors. in
Civil Appeal No. 7300 of 2022 dated 27.03.2023'. That the
recovery of money due from accused after turning of accounts as
NPA is civil liability of accused and cannot be turned as criminal
liability.
16. It has been further argued that the primary allegation in the
present case is that an alleged forged bank statement was
submitted, however, the bank statement itself is unsigned and
was not subjected to CFSL examination as it did not contain any
signature or handwriting capable of comparison. Therefore, the
correct bank statement cannot prove as to who prepared,
fabricated, procured, submitted or used the alleged forged
statement. That no witness is mentioned in the prosecution list
who could prove that accused Suresh Kumar Gupta had prepared,
fabricated, procured, submitted or used the alleged forged
statement. Therefore, Section 468 and 471 of IPC is not attracted
in the present case.
17. It has been further argued that the mere allegations of two
balance sheets without any proof of authorship, preparation,
submission, receipt by Bank and dishonest intention cannot
constitute falsification of account under Section 477A IPC. That
Section 477A IPC deals with falsification of books, accounts or
records. However, a disputed balance sheet without proof that the
underline Books of Accounts were falsified, altered, mutilated,
destroyed or manipulated by accused Suresh Kumar Gupta
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cannot by itself attract Section 477A IPC.
18. It has been further argued that all the amounts which has
been flown from the accounts of M/s Shri Sudershan Tubes to its
sister concern entities has already been returned to his account
and no loss has been suffered. This shows that the allegations of
diversion, siphoning off funds, wrongful gain, dishonest
misappropriation or dishonest intention from inception is not
made out as all the said transactions stood reversed well before
registration of FIR by CBI.
19. Ld. counsel for accused relied upon the judgment of
Hon'ble High Court of Delhi in Crl. Revision No. 1105/2023 in
Vinay Pratap Singh vs. State of Government of NCT of Delhi &
Ors.
20. It is further argued by Ld. counsel for accused persons that
accused Rajat Gupta was a young person of 22 years of age and
was pursuing his Chartered Accountancy Course. That after
qualifying as CA in the year 2013, he resigned from all the three
concerns (M/s Govardhan Industries Pvt. Ltd., M/s Synergy India
Ltd. and Shree Govardhan Steels) with which he was formally
associated. That accused Vipul Gupta was only 21 years of age
when he became Director in M/s Synergy India Pvt. Ltd. and his
association with the said company in absence of any specific
overt act and criminal intent be treated as proof of conspiracy or
cheating. That they have been made accused not on account of
any direct role in the borrower company but only on account of
their formal association with other entities. That they were
neither Director nor Guarantor nor Borrower nor Loan Applicant
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nor AR of M/s Shri Sudershan Tubes. They were not concerned
with sanction, enhancement, renewal, operation or utilization of
credit facilities granted by the bank. That the prosecution has not
attributed any specific overt act to accused Rajat Gupta and
Vipul Gupta. That no amount is shown to have been credited in
the account of the accused Rajat Gupta and Vipul Gupta directly
i.e. no personal gain, personal enrichment or unlawful benefit
have been established by the prosecution. That once the company
has been made an accused, criminal liability cannot be fastened
on the accused persons separately, merely because of the fact that
they were the Directors of the said company. That accused Rajat
Gupta and Vipul Gupta have been implicated in the present case
on account of their family relationship with promoter/principal
accused Suresh Kumar Gupta and merely family relationship
cannot constitute criminal conspiracy or cheating. Ld. counsel for
accused persons also relied upon judgment of Hon’ble Supreme
Court of India in Sunil Bharti Mittal vs. CBI, S.K. Alag vs. State
of UP, Maksud Saiyed vs. State of Gujarat and GHCL
Employees Stock Option Trust vs. India Infoline Ltd. That
accused Vipul Gupta was not arrayed as accused in the main
charge-sheet and has been implicated in supplementary charge-
sheet.
21. It has been argued by Ld. Counsel for the accused Chhaya
Singhal that the prosecution has failed to place invoices raised by
the proprietorship firm on record and merely come to the
conclusion of fictitious transactions on the basis of records
obtained from RTO and no further documents are available with
the prosecution to substantiate their allegations. That the accused
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CBI vs. SURESH KUMAR GUPTA & ORS. Page No. 8 of 12
is engaged in the business of wholesale trading of iron and steel
and working as commission agent. That the accused alongwith
her firm has filed ITRs regularly. That the requisite books of
accounts were maintained and the same were audited regularly.
That there is possibility that anu office staff might have recorded
wrong transportation details i.e. truck numbers of goods for a few
transactions. That this bonafide error by one employee for a few
transactions into no-genuine category if same is view in holistic
manner. That during entire investigation, no document has been
brought on record by the prosecution that the companies alleged
to be very fake or the transactions between them were not the
business transactions.
22. It has been further argued that the prosecution has failed to
show that the companies to which payment has been made were
fake and fictitious and they were unjustly enriched. Ld. Counsel
relied upon the judgment of Hon’ble Supreme Court of India in
RK Vijaysarthy Vs. Sudha Seetharaman Criminal Appeal no.
238 of 2019, SLP (Crl.) 1434 of 2018. That the prosecution has
failed to show mens rea on the part of the accused Chhaya
Singhal.
23. It has been further argued that no offence under section
486 and 477A IPC is made out against the accused Chhaya
Singhal. That the prosecution failed to show any common
intention or criminal conspiracy of accused Chhaya Singhal with
other co-accused and accused cannot be charged for the offence
under section 120B IPC. That the accused is neither the borrower
nor guarantor nor beneficiary of any credit facility taken from the
bank. Ld. Counsel for accused relied upon judgments of Hon’ble
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CBI vs. SURESH KUMAR GUPTA & ORS. Page No. 9 of 12
Supreme Court of India in Mr Nagvi Askari Vs. CBI 2009(15)
SCC 643, CBI, Hyderabad Vs. K. Narayan Rao 2012(9) SCC
512 and S. Arul Raja vs. State of Tamil Nadu 2010(8) SCC 233.
24. I have considered the rival submissions and have carefully
gone through the record.
25. It is well settled law that at the stage of framing of charge,
only prima facie material is to be seen. Law regarding
consideration at the stage of framing charges is well settled now.
The court has power to sift and weigh the evidence for the
limited purpose of finding out whether or not a prima facie case
against accused has been made out. When the material placed
before the court discloses grave suspicion against the accused
which has not been properly explained the court will be justified
in framing charge. If on the basis of material available on record
a court could come to the conclusion that commission of the
offence is a provable consequence, a case of framing of charge
exists. To put it differently, if the courts were to think that the
accused might have committed the offence it can frame a charge,
though for conviction the conclusion is required to be that the
accused has committed the offence.
26. At the stage of framing of a charge probative value of the
materials on record cannot be gone into, the material brought on
record by the prosecution has to be accepted as true at that stage.
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
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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 this
stage of deciding the matter under section 239 of CrPC. At this
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. 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.
27. While deciding the question of framing of charge in a
criminal case, the court is not to apply exactly the standard and
test which it finally applies for determining the guilt or
otherwise. This being the initial stage of the trial, the court is not
supposed to decide whether the materials collected by the
investigating agency provides sufficient ground for conviction of
the accused or whether the trial is sure to culminate into his
conviction. What is required to be seen is whether there is strong
suspicion which may lead to the court to think that there is
ground for presuming that the accused has committed an offence.
28. Reliance placed on Union of India Vs. Prafulla Kumar
(1979) 3 SCC 4: State of Maharashtra and others Vs.
Somnath Thapa and others JT 1996 (4) SC 615 State of Bihar
Vs. Ramesh Singh AIR 1977 S C. 2018; Umar Abdula Sokoor
Sorathia Vs. Intelligence officer, NCB JT 1999 (5) SC 394;
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Kallu Mal Gupta Vs. State 2000 I AD Delhi 107.
29. Now coming to the present case, Vipul Gupta has been
arrayed as an accused in the supplementary chargesheet being
Director of M/s Synergy India Pvt. Ltd. and on the allegations
that he is also hand in glove with the other Director Rajat Gupta.
30. In Sunil Bharti Mittal Vs. CBI, AIR 2015 SC 923, it has
been categorically held by Hon’ble Supreme Court of India that a
company’s Director cannot be made accused merely because of
their designation and there is no vicarious liability unless the
statute specifically provides so. The ‘alter ego’ doctrine
ordinarily works to attribute the acts of directing minds to the
company but it cannot be automatically used in reverse to
prosecute the Directors for the acts of the company.
31. For arraying Vipul Gupta as accused in the present case,
there must be specific allegations regarding his active role and
criminal intent but in the supplementary chargesheet nothing is
mentioned about the role of the accused Vipul Gupta and his
criminal intent and IO had only mentioned that he was also hand
in glove with Director Rajat Gupta and was in active party to the
criminal conspiracy without attributing any specific role.
32. There are clear and categorical allegations against all the
accused persons which is evident from the material available on
record including the statement of witnesses. The witness from
Punjab National Bank and original bank statement of account of
PNB bank of M/s Shri Sudershan Tubes prima facie shows that
the account statement was filed under the signature of accused
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Suresh Kumar Gupta is forged and fabricated. From the facts
disclosed so far, prima facie, it appears that all the accused
persons except Vipul Gupta are liable to be charged for the
offences punishable under Section 120-B IPC r/w Section 420,
468, 471 and 477A IPC and accused Suresh Kumar Gupta is also
liable to be charged for the substantive offence punishable u/s
420, 468, 471 and 477A IPC. Accused Chhaya Singhal is also
liable to be charged for the substantive offence punishable u/s
420, 468 and 471 IPC. Here, prima facie, there is no material on
record to frame the charges qua accused Vipul Gupta.
33. Hence, plea of accused persons except Vipul Gupta
seeking discharge is without any basis and is accordingly
declined and accused Vipul Gupta is hereby discharged.
34. Accordingly, application filed by accused Chhaya Singhal
seeking discharge also stands dismissed.
(MAYANK GOEL)
ACJM-02-CUM-ACJ
RACC/NEW DELHI/30.06.2026
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