“It is now settled law that investigation machinery can be set in motion by anyone on information of cognisable offence. The prosecution was initiated on the basis of information received by the CBI and it would be entitled to do so in regard to its statutory powers contained in the Delhi Special Police Act since the money involved in the financial fraud is public money belonging to public sector banks. Therefore, merely the banks have not filed any complaint and/or lodged an FIR is no ground to hold that there is no any cheating, forgery, fraud committed by the accused,” additional chief metropolitan magistrate Jaywant C Yadav said.
The magistrate refuted the defence citing a one-time settlement of Rs 25 crore made with one of the banks to absolve them of their criminal liability. It was held that the accused entered into a criminal conspiracy, forged documents to avail credit facilities and misused them.
It was also observed that it was clear that socio-economic offences were affecting the economy and need to be viewed seriously. CBI’s special public prosecutor Sandeep Kumar submitted that the actual fraud and cheating committed totals over Rs 100 crore, but the settlement was only about Rs 25 crore.
Seeking severe punishment, Kumar submitted that the settlement was entered into during pendency of the case. During pendency of the trial, two accused, chairman Hari Ranka and vice-president Ranglal Nahar, died while another R J Rathi is absconding. The accused company was formally known as Modern Suitings Pvt Ltd and later Modern Denim Ltd.
In the judgment, the magistrate said the funds were misused for other liabilities.
