Quashed

Union of India v. Sanjeevkumar Amarnath Dhar and Ors.

Bombay HC16 Jul 2013REVN/53/2011

Case brief

AI extract

What is this about?

The High Court granted a criminal revision application to quash an order of discharge. It held that the Special Judge erred by relying on correspondence rather than witness statements which revealed non-compliance with insurance company rules and potential conspiracy.

What did the court decide?

The order of discharge of the original accused by the Special Judge dated 11th October, 2010 is quashed and set aside.

Union of India Vs Sanjeevkumar Amarnath Dhar and Ors. — Corruption | Bombay HC (2013)

¶1

revn53-11

¶2

IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION

¶3

rpa

¶4

CRIMINAL REVISION APPLICATION NO.53 OF 2011

¶5

Union of India Through the Central Bureau of Investigation, ACB, Pune. .. Applicant Vs. Sanjeevkumar Amarnath Dhar & Ors. .. Respondents

¶6

Mr. J. R. Solanki, PP for the Applicant – Union of India, CBI. Dr. Yug Mohit Chaudhary, Advocate for Respondent Nos.1 and 2. Mr.Mahesh Sabnis i/b. Ms. Dimple K. Shah, Advocate for Respondent Nos.3 and 4.

¶7

Mr. D. R. More, A.P.P .for Respondent No. 5 – State.

¶8

CORAM : K. U. CHANDIWAL, J.

¶9

DATED : JULY 16, 2013.

¶10

P.C. :

¶11

Heard the learned counsel for complainant, CBI and Respondent (original accused) at length. Both the sides have threadbare referred to the documents to impress respective points favouring the applicant or the respondent.

¶12

2 CBI/prosecution feels aggrieved by order of

¶13

discharge recorded by the learned Special Judge (under the P.C. Act) Pune dated 11^th October, 2010 below Exhibits – 53 and 56

¶14

1/11

¶15

revn53-11

¶16

in Special Case No.14 of 2007. The application at Exhibit – 53 was filed by original accused nos.1 and 2 while Exhibit – 56 was filed by original accused nos. 3 and 4.

¶17

3 Original accused no.1 Mr. Sanjiv Kumar Dhar was Regional Manager of National Insurance Company Limited (for short “the Insurance Company”) at the relevant time based on Pune. Accused no.2 Omprakash Grover was General Manager at head office based on Calcutta at the relevant time, original accused no.3 Smt. Sultana Samad Shaikh @ Shubhangi Sadasiv Shripad was a Development Officer at the branch of Insurance Company at Pune, original accused no.4 Abdul Samad Shaikh Hussain was an agent of the Insurance Company, Pune Divisional Office – II.

¶18

4 The prosecution case illustrate, as a part of criminal conspiracy arrived at between the accused/respondents they have claimed agency commission on Maharashtra State Electricity Board Staff Welfare Fund Committee in respect of Group Janta Personal Accident Policy. The commission received by accused nos. 3 and 4 was Rs.32,30,700/ (Rs. Thirty Two

¶19

2/11

¶20

revn53-11

¶21

Lacs Thirty Thousand and Seven Hundred only) on 14^th May, 1999 (as per the disbursement voucher). The policy was issued on 25^th February, 1998 it was terminated, somewhere in 2003.

¶22

5 The long drawn correspondence between the Secretary of the Welfare committee and the officers of Insurance Company was shown.

¶23

6 Mr. Chaudhary, learned counsel for original accused nos. 1 and 2 says the Welfare Fund Committee has no nexus with the Maharashtra State Electricity Board (hereinafter referred to as “MSEB” for short) and secondly it being an independent body, it had its rightful implications on the agent receiving the commission on policies with such Welfare Fund Committee. To impress his point, the learned counsel dealt with correspondence by National Insurance Board which according to him has a co sharing if the premium is relating to insurance by government organisation or government officials, however, since Staff Welfare Fund was not a government organisation, according to him the National Insurance Board did not contribute as was expected. The learned counsel says the

¶24

3/11

¶25

revn53-11

¶26

governing body of the Insurance Company has passed a resolution authorising payment of commission and if such authorisation was in legal tune, there could not be any criminal conspiracy by accused nos.1 and 2 with accused nos.3 and 4. He repeats, MSEB has no control over Staff Welfare Committee even if the Welfare Committee has no bank account at the material time, however, MSEB released interest at the rate of 18% at the funds of Welfare Committee. He repeated, the insurance which was drawn and Rs. 2.42 crores was repaid on termination of policy, vide receipt dated 7^th March, 2003, to MSEB Staff Welfare Fund and not to the account of MSEB.

¶27

7 The learned counsel for the accused – applicant nos.

¶28

3 and 4 says that respondent no.4 was an agent since 1995 while respondent no.3 was in employment thereafter at the material time. However, their interse marriage was 9^th January, 1997, has no nexus to policy drawn which was 26^th February, 1998 as the transaction according to him commenced on 26^th February, 1996.

¶29

8 The learned counsel for CBI also threadbare

¶30

4/11

¶31

revn53-11

¶32

referred to the documents to indicate how a conspiracy was hatched to manipulate the record and ensured release of commission in favour of respondent nos.3 and 4. According to him, the policy and rules of National Insurance company does not permit a spouse to act as an agent if other spouse is employee at the Insurance Company. In blatant disregard to the rules it was not disclosed to the superiors about the marriage and clandestinely the amount of commission was received. According to him, there was no reason for accused nos.1 and 2 to have acted beyond the scope of powers vested to them in ensuring release of commission to the tune of Rs.32,30,700/ to respondent nos.3 and 4 (in particular respondent no.4).

¶33

9 It is a matter of record, by efflux of several communication between the National Insurance Company and MSEB Welfare Fund, ultimately the insurance policy has been terminated and as stated above the cheque amount was reimbursed. However, on query to both the learned counsel it is reveled that the amount received by respondent nos.3 and 4 on 14^th May, 1999 is not yet credited with the employer, the National Insurance Company.

¶34

5/11

¶35

revn53-11

¶36

10 Before embarking several sets of documents the root

¶37

cause and the policy of formulation of welfare fund needs to be

¶38

taken into consideration. The policy circular dated 19^th May, 1973 was titled as Staff Welfare Fund. The fund was to be administered to a committee constituted of the Chairman of Board which consist of :

¶39

(a) Technical Member (President),

¶40

(b) one nonofficial member of the Board by

¶41

rotation every year nominated by Chairman,

¶42

¶43

(d) Financial Controller,

¶44

(e) Chief Industrial Relations Officer,

¶45

(f) Three members form amongst employees to be nominated by the Chairman.

¶46

So far as arrangement of funds are concerned, Clause three provides :

¶47

(i) An amount recovered from employees who have resigned without giving due notice (i.e.

¶48

6/11

¶49

revn53-11

¶50

amounts recovered in lieu of notice period), if any;

¶51

(ii) Unclaimed and lapsed salaries and allowances, if any;

¶52

(iii) Funds contributed by the Board.

¶53

Clause 5 provides for constitution of Committee which again authorizises the chairman to constitute a Committee for the purpose of managing and administering the fund and to carry out such other function as assigned to the Committee. The Committee shall consist of other members as referred earlier. The Committee shall publish a report on the activities financed from the fund, together with audited statement of receipts and expenditure from the fund and issue within three months from the close of the year.

¶54

Thus, reading the above referred guidelines it is more than clear, there was no exclusive authority, to The Welfare Fund or the Committee constitute. It was all throughout funds generated either by the MSEB or the funds of lapse amount recovered / received by the MSEB. It is also evident there was no regular remittance from the employees to generate the fund.

¶55

7/11

¶56

revn53-11

¶57

Hence, the question of independent identity of the welfare fund does not arise. This position having been accepted, there could not be release of commission to respondent nos.3 and 4 as in respect of policy drawn by governmental bodies.

¶58

11 The correspondence by the Secretary to the fund Goroba Bhimrao Sawalkar, or in his absence made by one Mr. Bhosale, needs to be taken in proper prospective and should not be taken as a rule to act upon, against settled policies of Board. Statement of Shashikant Narayan Laxmeshwar, Prakash Gopal Godse, Chief Engineer, Vinita Porwal Senior Divisional Manager, Vijaykumar T. Bedmutha Development Officer, Arun Sooryakant Gandhi Internal Auditor are of importance which high light the policy structure of Insurance Company and entitlement to commission. The Internal Auditor has clarified that :

¶59

(1) The premium was paid by MSEB instead of the MSEB Staff Welfare Fund Committee to whom this policy was issued;

¶60

(2) The premium register did not contain the agency code, which shows that it is a direct premium on which agency commission was not

¶61

8/11

¶62

payable;

¶63

(3) In the Premium Receipt the Agency Code was added subsequently;

¶64

(4) Basically this business was not a commissionable business since as per Rules of Payment of Agency Commission the agency commission cannot be paid, when it is directly or indirectly controlled by the Govt. and

¶65

(5) Commission can only be paid if the premium is collected solely and exclusively through contributions from the employees. In this case both the conditions were not fulfilled.

¶66

12 These statements were predominantly expected to

¶67

be considered by the learned Judge than banking upon the correspondence. The structural position of the funds visavis employer MSEB could not be by an communication made either by Shri. Shewalkar or Shri. Bhosale. The resolution of National Insurance Board, could not be put in acceleration, as misplaced facts about independency of welfare fund to the employer MSEB was projected which factually was incorrect.

¶68

9/11

¶69

revn53-11

¶70

13 There were persistent communication from Shri Grover to Shri Shewalkar, requiring correspondence in particular line which highlights as concern of conspiracy to ensure release of payment to unauthorised person that too illegally causing loss to Insurance Company.

¶71

14 Taking survey of the above facts, the order of learned Judge calls for interference as he more leaned to the correspondence which was of inconsequently than to refer statement under Section 161 of the Code of Criminal Procedure of the respective witnesses who explained the scheme governmental authorities, authority of National Insurance Company and the policy decisions. That apart, the paper also demonstrate, it would not be the sole contribution of respondent nos.3 and 4 for generating the policy or collecting the premium. Officers at Mumbai and Lature had liaison with the authorities of MSEB in respect of the insurance cover. As per the policies of Insurance Company, other agencies were also authorized and eligible to receive such commission/contribution, if it is from a nongovernmental agencies. Taking stock of all the above facts, the order of learned Judge is quashed and set aside.

¶72

10/11

¶73

revn53-11

¶74

15 Parties to appear before the learned Judge on 19^th August, 2013.

¶75

(K. U. CHANDIWAL, J.)

¶76

11/11

Union of India v. Sanjeevkumar Amarnath Dhar and Ors.

Case brief

What is this about?

What did the court decide?

Union of India v. Sanjeevkumar Amarnath Dhar and Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Parties & counsel

Coram

Case details

Similar cases

Jasmin Bhogilal Shah Vs the State of Maharashtra and Anr.

Amarjeet Nirangan Singh and Ors. Vs the State of Maharashtra and Anr.

Jessy Alex Binoy Vs v. a. Thomas and Anr.

M/S. Infosys Autocad Systems (India) Ltd. and Anr. Vs M/S. Tech Pacific (India) Ltd. and Anr.

Vithal @ Kalyan Abhijit Varekar Vs the State of Maharashtra

Ajay Ganesh Ubale Vs Vir Sanghvi and Anr.