J&K High Court on Wednesday dismissed a petition challenging an FIR registered by Anti-Corruption Bureau (ACB) against ex-Chairman J&K Cooperative Bank for sanctioning fraudulently a loan of Rs 250 crore in favour of a “non-existent Cooperative Society”, River Jhelum Cooperative House Colony.
The Bank had sanctioned the loan in favor of the Society for construction of a satellite township at Shivpora here and till May 1, Rs 223 crore were released by it.
Muhammad Shafi Dar who was sacked as Chairman of the Bank, in his plea before the Court sought directions for quashing the FIR which was registered by the ACB against him in March.
While dismissing the plea, a bench of Justice Vinod Chatterji Koul observed that the case was still under investigation and concerned agency was in the process of collecting evidence.
“The investigation is necessary and the same can’t be stopped, at this stage, in the proceedings under section 482 CrPC,” the Court said
It pointed out that the investigation in the FIR which was filed on March 8 has just commenced and the petitioner has come up with petition.
“No report as contemplated under the Code of Criminal Procedure has been submitted by concerned agency to the Court empowered to take cognizance of the offences,” the Court said.
The FIR under challenge, the Court said, revealed that the Society was alleged to have been given Rs 250 crore without following basic and fundamental prerequisites by the Bank, which was headed by the petitioner.
The Court said the society was not registered with Registrar Cooperatives, J&K and even does not exist anywhere.
It held that report of Enquiry Officer, Deputy Registrar (Counsel) Cooperative Societies J&K was self-explanatory.
“And if discussed here, it would open a Pandora box for discourse, discussion and threadbare examination and trial, which is the exclusive domain of investigating agency and the trial court,” the Court said.
According to the FIR, the Bank, sanctioned Rs 230 crore loan without obtaining the details of the society, balance sheet, profit and loss account, business, PAN No., Income tax return, details of Constitution of the board and Board resolution.
The probe by the ACB has revealed that the Society had not been registered with Registrar Cooperative Society, J&K.
The ACB said the Chairman of the so called River Jhelum Cooperative House Building Societies Ltd, Hilal Ahmed Mir of Magarmal Bagh Srinagar by acting in league with the Chairman of J&K Cooperative Bank Srinagar and others has prepared a fake and fictitious registration certificate of the Society.
“The loan was sanctioned in a single day on the basis of simple note that was initiated on 24 April 2019 for Rs 250 crore,” it said.
The ACB contended that as per the loan manual of the bank, the maximum limit to be sanctioned under cash credit for an individual was only Rs one crore and Rs 250 crore was sanctioned to the Society in absence of any cash credit facility for societies in the loan compendium of the bank and in violation of its credit lending policy.
According to ACB, the physical verification has also revealed that the Society was not in existing at the given address.
The ACB has registered the FIR against Chairman of the Society, Hilal Ahmad Mir as well Chairman J&K Cooperative Bank, Muhammad Shafi Dar and others under J&K PC Act and RPC for causing a loss of Rs 223 crore to the bank.
The petitioner, however, claims that the Society approached the Bank for grant of the loan for converting land measuring 257 kanals and 18 marlas, situated at Shivpora, Srinagar, into a Satellite Township.
The Society, he said, moved a representation before the Bank in January 2018 and the Bank wanted to know status of land before taking any action on representation of Society.
“The case of the Society was placed before Board of Director of the Bank and in its meeting held on 21 March 2019 Board of Directors sanctioned loan in favour of the Society as was also approved by General Body on 8 September 2018,” it said.
The Society, the petitioner contended, cannot sell land unless and until it does not take consent from the bank and in case of failure by the Society, the bank can take over the land and that there was no violation of any rule or byelaw or regulation.
“Only thing to be seen in FIR is as to whether the Society is registered or not and by applying general principle of law even in that case no offence is made out against Board of Management or petitioner,” he said.