UNION OF INDIA vs S.S. SANDHU

1
VED
PRAKASH
DEWANGAN
Digitally signed
by VED
PRAKASH
DEWANGAN
Date: 2026.10.16
18:35:08 +0530

CGHC010236692024 2026:CGHC:44933
NAFR
HIGH COURT OF CHHATTISGARH AT BILASPUR
ACQA No. 479 of 2024
Reserved for judgment on 07/10/2026
Judgment delivered on 16/10/2026
Union Of India Through Central Bureau Of Investigation, ACB, Chhattisgarh,
Raipur (C.G.)
... Appellant
versus
1 - S.S. Sandhu S/o Late Shri B.S. Sandhu Aged About 64 Years The Then
Director M/s Atlantic Engineering Services, Private Limited New Delhi.
2 - D.J.S. Sandhu S/o Late Shri B.S. Sandhu Aged About 60 Years The Then
Director M/s Atlantic Engineering Services, Private Limited, New Delhi.
... Respondents
(Cause title taken from Case Information System)
For Appellant : Mr. Vaibhav A. Goverdhan, Advocate
For Respondents : Mr. Anupam Lal Das, Senior Advocate
along with Mr. Kunal Verma and Mr.
Kashif Shakeel, Advocates
Hon'ble Shri Justice Ravindra Kumar Agrawal
C.A.V. Judgment
1. The present acquittal appeal under Section 378(2) of the Code of
Criminal Procedure, 1973 has been filed by the appellant Union of
India against impugned judgment of acquittal dated 13.09.2019,

2
passed by learned Special Judge, Special Court for trial of CBI cases,
Raipur (C.G.) in Criminal Appeal No. 37 of 2018, whereby the
respondents/accused persons have been acquitted from the offence of
Section 120-B, 420 read with Section 120-B of IPC by setting aside the
judgment of conviction and sentence dated 10.01.2018, passed by
learned Special Judicial Magistrate (CBI), Raipur in CBI Criminal Case
No. 4/1994, which was arising out of CBI Crime No. RC 23(A)/86-08,
dated 02.06.1986.
The case of prosecution, in brief, is that, the respondents/accused
2.
persons along with other accused persons (since deceased) were the
Directors of M/s. Atlantic Engineering Service Private Limited. The said
firm M/s. Atlantic Engineering Service Private Limited awarded a
contract in the year 1981 by the NTPC Super Thermal Power Project,
Korba for construction and installation of ventilation system and air-
conditioning plant in Stage 3x200 project. Under the contract, the said
M/s. Atlantic Engineering Service Private Limited started supply of
equipments from 24.04.1981 and it was the condition that the payment
of supplied goods were to be made through letter of credit and it was
being paid through State of Bank of India, Parliament Street Branch,
New Delhi. Being their contract period, the Central Bureau of
Investigation (in short ‘CBI’) received a secret information that in
between January, 1982 and November, 1982, certain officers of NTPC
Korba conspired with the M/s. Atlantic Engineering Service Private
Limited an in furtherance thereof paid an amount of about Rs. 20 lakhs
without receiving the goods from them and issuing forged bills and
vouchers, thereby caused huge monetary loss to the NTPC and the

3
M/s. Atlantic Engineering Service Private Limited obtained unlawful
gain. The CBI registered an FIR against M/s. Atlantic Engineering
Service Private Limited for the offence under Section 120-B read with
Section 420, 468, 471 of IPC and Section 5(2) read with Section 5(1)
(d) of Prevention of Corruption Act, 1947. During the investigation, it
was found that letter of credit was issued in favour of M/s. Atlantic
Engineering Service Private Limited on 17.11.1981 (exhibit P-39) and
according to which the payment of goods was to be paid through the
bank. Certain bills were produced by M/s. Atlantic Engineering Service
Private Limited before the concerned bank, but the goods were not
supplied as per the bills submitted by them and the firm shown in the
bills were not in existence and they obtained its payment. After
investigation, charge sheet was filed against 5 accused persons
including the present respondents before the learned Special
Magistrate, CBI, Raipur.
The learned trial Court framed charge against the accused persons for
3.
the offence under Section 420 read with Section 120-B of IPC. The
accused persons abjured their guilt and claimed to be tried.
4. In order to prove the charge against the accused persons, the
prosecution has examined as many as 32 witnesses. Statement of the
accused persons under Section 313 of CrPC have also been recorded,
in which they denied the circumstances that appears against them,
pleaded innocence and submitted that they have been falsely
implicated in the offence. The accused S.S. Sandhu, Virender Singh
Garewal, Brigadier H.L. Siddhu and D.K.S. Sandu submitted that they
had various meetings with the officers of NTPC, in which it was

4
disclosed that certain goods have not been supplied, but payments
have been made, thereafter they refunded the amount with respect to
those goods and subsequently, those goods were supplied to NTPC. In
the month of February-March 1982-83, the parties have settled their
dispute and no any grievance remained. They were never intended to
cheat the NTPC and have no mens rea . They have never issued any
forged or false bills. Before dispatch of the consignment of the goods,
it was physically verified by the officers of NTPC and only thereafter,
they issued a certificate and then the goods were transported and
when it was reached to its destination another certificate was being
issued by the NTPC. It is further submitted that, they have also
completed the contract awarded by the NTPC, Singrouli without any
complaint, which was worth Rs. 1.40 crores. After about 4 years, the
CBI, on a false and unfounded complaint registered the offence,
however neither the officers of NTPC nor the bank authorities have
made any complaint against them and there was no any outstanding
dues. The witnesses have been deposited under the pressure of CBI
and he suffered long litigation for about 23 years.
During the pendency of the trial, 3 accused persons namely V.S.
5.
Garewal, P.N. Handa and H.S. Siddhu have died.
6. The accused persons have examined defense witness No. 1 Vikas
Agrawal in their defense and the accused S.S. Sandhu has also been
examined himself as defense witness No.2 (marked as defense
witness No.1).

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After appreciation of the oral as well as documentary evidence led by
7.
the parties, learned trial Court convicted and sentenced the accused
persons for the offence under Section 120-B and Section 420 of IPC
and sentenced them for R.I. for one year with fine of Rs. 1000/- and
R.I. for 3 years with fine of Rs. 10,000/- respectively to the each
accused persons with default stipulations by the judgment dated
10.01.2018.
The judgment of conviction and sentence dated 10.01.2018, passed by
8.
the learned trial Court was challenged by the accused persons before
the learned Special Judge of Special Court for trial of CBI cases,
Raipur by filing the Criminal Appeal No. 37 of 2018. The said criminal
appeal was allowed on 13.09.2019 and the respondents/ accused
persons have been acquitted from all the offences. Hence the present
appeal against acquittal.
9. Learned counsel appearing for the appellant/CBI would submit that,
the prosecution has proved its case beyond reasonable doubt. But for
minor omissions or contradictions, the evidence of prosecution
witnesses are cogent and reliable, which are sufficient to hold the
respondents/accused persons guilty for the alleged offences. After
appreciating the evidence available on record, the learned trial Court
had rightly convicted and sentenced the accused persons, but without
considering the evidence in entirety, the learned appellate court
allowed the appeal and acquitted the respondents/accused persons.
He would submit that PW-5 Rohtan Singh, who was the then Security
Officer, NTPC, Korba has clearly deposed that, no any goods were
received between July, 1981 and September, 1981 at NTPC Korba

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through the truck No. 7312. Likewise, PW-7, Sardar Singh has also
deposed that no goods were transported to NTPC Korba through the
Bilti No. B-7986 and B-6552. He would also submit that PW-8
Jaintleshwar Shendre has also deposed that the truck through the
goods were said to have been supplied, had never come to the NTPC
Korba in between the relevant period and no goods were received by
the NTPC Korba. Likewise, PW-9 Makhan Singh and PW-10 Jaspal
Singh have also consistently deposed that no goods were supplied to
the NTPC Korba, which are the disputed transactions in the case. M/s.
Atlantic Engineering Services Private Limited misused the facility of
letter of credit and received payment for the goods which was not
supplied. He would also submit that the learned appellate court has
erred in not appreciating the evidence of PW-17 R.C. Dhruw, PW-18,
R.K. Kaul and PW-19 Jaiveer Singh, who deposed the process of
supply of goods and the physical verification of the goods at the time of
its loading in the truck was not mandatory and therefore, the accused
persons cannot take benefit that at the time of loading of goods it was
physically verified and then only a certificate was issued for its
transportation. The accused persons cannot disputed that they have
not received such amount. He would also submit that subsequent
meeting with the NTPC officers and settled their grievances, refund of
the amount itself evidencing that the accused persons are guilty of the
conspiracy and cheating and they had mens rea from the very
beginning of the subject transactions. The learned trial Court after
having elaborate consideration of the evidence available on record and
detailed discussions, convicted the accused persons, but the learned
appellate court without properly appreciating the evidence led by the

7
prosecution, set aside the well founded judgment of conviction and
sentence. Therefore, the impugned judgment of acquittal suffers from
perversity and illegality, and the same is liable to be set aside by this
Court.
Per contra, learned Senior Advocate appearing for the respondents
10.
opposes the submissions made by learned counsel for the appellant
CBI and has submitted that the prosecution has failed to prove its case
beyond reasonable doubt. There are material omissions and
contradictions in the evidence of prosecution witnesses, which cannot
be made basis to convict the accused persons for the alleged offence.
He would further submit that the FIR was registered against the
officers of NTPC and M/s. Atlantic Engineering Services Private
Limited, however the officers of NTPC have been left over and charge
sheet have not been filed against them for the reason best known to
the CBI. The work contract was awarded to M/s. Atlantic Engineering
Services Private Limited, however the said firm has not been arrayed
as an accused in the case and only the Directors of the said firm have
been arrayed as an accused persons. Leaving the officers of the NTPC
itself creates suspicion over the prosecution’s case. There is no
evidence of any conspiracy with any officers of the NTPC as the
officers of NTPC are not the accused for any conspiracy in the case.
Therefore, the prosecution of the accused persons for conspiracy
under Section 120-B itself vitiates. He would further submit that, there
is no monetary loss to the NTPC. There was only a procedural
deficiency in supply of goods and the goods were supplied later on as
and when the deficiency came into knowledge of the accused persons.

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The officers of NTPC admitted the receiving of goods. There is no
mens rea or deception to cheat the NTPC as there is no complaint by
the NTPC. The work contract was awarded in the year 1981 and the
accused persons have completed the work in the year 1982-83, but
the FIR was registered on 02.06.1986 i.e. after about 4 years of
completion of the work. He would further submit that there was regular
meeting between the accused persons and the officers of NTPC for
settlement of the account, but they have never raised any objection
and accounts were settled time to time. Had there been any cheating,
there should be no extension of the validity period of letter of credit and
their security amount would be forfeited and no meeting for
reconciliation would be conducted. He would also submit that the work
progress was also monitored by the officers of NTPC, hence no any
deficiency were also found. Furthermore, the outstanding amount were
paid along with the interest as per the conditions of their agreement
and settled in their reconciliation meetings. He would refer to the
documents (exhibit D-3, D-5 and D-9). He would further submit that the
scope of interference in the appeal against acquittal is very limited and
unless it is found that the view taken by the court acquitting the
accused persons is perverse or illegal, the interference in the judgment
of acquittal is not permissible. The judgment of acquittal is not liable to
be interfered merely because a contrary view is permissible,
particularly where the view taken by the appellate court is a plausible
view based on proper appreciation of evidence, therefore, the
judgment of acquittal is not liable to be interfered with and the acquittal
appeal is liable to be dismissed.

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I have heard learned counsel for the parties and perused the record of
11.
the trial court as well as appellate court.
The issue involved in the present case is that, whether the accused
12.
persons, in between January, 1982 to November, 1982 conspired to
cheat the NTPC and in furtherance thereof, they fraudulently and
dishonestly induced and produced forged bills and obtained Rs.
19,94,593.67/- from the State Bank of India, Parliament Street Branch,
New Delhi and thereby committed the offence of conspiracy and
cheating. The learned trial Court has convicted the accused persons,
whereas the learned appellate court has acquitted them from all the
offences, therefore, this court deem it appropriate to re-appreciate the
evidence available on record.
13. PW-5, Rohtan Singh was the Assistant Security Officer at NTPC,
Korba. He was assigned the duty to maintain the record of entering
and exiting of the vehicles in the NTPC gate. He stated that the truck
No. 7312 has not entered into the premises between July, 1981 and
September, 1981 and no goods were supplied from the said truck. He
also gave relevant information to CBI through the document (exhibit P-
17). In cross-examination he stated that, the entries in the register at
the gate was being made by security guard. He did not know as to who
was the guard, who made entries in the register. He also did not
identify the handwriting of the guard. He could not tell about exact
number of truck visited in the premises within 24 hours. After
02.12.1981, the CISF have prepared their own register.

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PW-7, Sardar Singh is the owner of truck No. CPH 7312. He stated in
14.
his evidence that, his truck has never gone to Korba and it was running
between Narsinghpur, Jabalpur and Katni. Through the Bilti No. B
7986 and B 6552 (exhibit P-22 and P-23), his truck has never
transported any goods from Faridabad to Korba or Kolkata to Korba. In
cross-examination he stated that, he purchased the said vehicle in
May, 1982, before that it was registered in the name of Makkhan
Singh. He did not know, as to whether Makkhan Singh sent the vehicle
to Korba or not. He also could not remember the date of its purchase
by him. He also did not have any document with respect to the
purchase of the said vehicle. When he was confronted the documents
(exhibit P-22 and P-23), he shown his ignorance about the same. He
did not maintain the record of transporting of goods from his vehicle
No. 7312.
PW-8, Jayant Ishwar Shendre, who was the Inspector posted at NTPC
15.
Korba. On 13.06.1987, he received a letter (exhibit P-24) from CBI
seeking certain information about movement of the truck. They
maintained a register in the plant with respect to supply of goods
through the vehicles, which was called as material incoming register.
The information sought about the truck number was not found in the
said register and it was not come in the plant and they he supplied the
necessary information to the CBI, which is exhibit P-25. The said
information was signed by G.S. Ballagan and he identified his
signature. In cross-examination, he stated that, he was posted as
Inspector from May 1986 to September, 1988. He made inquiry on the
letter (exhibit P-24), but there is no written instruction given to him for

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inquiry into the matter. He could not tell as to what date he made
inquiry. He obtained the relevant record from the date of the plant.
PW-9, Makkhan Singh is the earlier owner of truck No. CPH 7312. He
16.
sold the said truck to Sardar Singh in the month of March-April, 1982.
When he owned the said truck, it was never gone to Korba. He proved
various seizures of the documents with respect to transportation of
goods from the said truck and stated that the goods shown in exhibit
P-29 to P-34 have never been transported to Korba. In cross-
examination, he stated that he himself had driven the said truck and
sometimes he engaged his driver. He has no any account of running of
the said truck. He did not know as to where his driver has taken the
truck for transportation of goods. The CBI has not inquired anything
from his driver. After 1982, when he sold the truck he did not know
about its running.
17. PW-10, Jaspal Singh is the owner of another truck bearing No. CPH
7335. He also stated that, his father Ajit Singh had purchased the truck
and the said truck had never gone to Korba. The CBI has seized two
toll tax receipts through the seizure memo (exhibit P-35) and the toll
tax receipts are (exhibit P-36 and P-37). On the said date, his truck
was transporting goods from Gwalior to Hyderabad. It was at
Hoshangabad on 28.01.1982 and at Nizamabad on 31.01.1982. In
cross-examination, he stated that the CBI has not seized any
document of his truck. His signature is not there in the documents
(exhibit P-36 and P-37). His father had the knowledge of the truck, who
died in the year 1992. He also did not know about the running of the
truck and its account, at that time, he was minor.

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PW-11, K.R. Soni is the Branch Manager, State Bank of India, Korba
18.
branch. Through the documents (exhibit P-39 and P-40) a letter of
credit was issued in favour of M/s. Atlantic Engineering Services
Private Limited. As per the letter of credit, the Bilti was to be produced
at their Parliament Street Branch, New Delhi and on the basis of the
document, payment was to be made to them. Thereafter the said
document was transferred to Korba branch and thereafter the relevant
amount was to be debited from the account of NTPC. Through the
seizure memo (exhibit P-59), the CBI has seized the relevant file on
07.05.1987. He also gave the details of payments debited from the
account of NTPC through the letter (exhibit P-60). The bills which they
received are exhibit P-61 and P-62 and the receipt is exhibit P-63. The
relevant receipt with respect to the bill (exhibit P-62) are exhibit P-64
and P-65. With respect to the bill (exhibit P-66), the receipt is exhibit P-
67. Likewise, he stated about other bills and receipts up to exhibit P-
85. In cross-examination, he stated that they have no authority to
inquire about the genuineness of the payments made through letter of
credit from Parliament Street Branch, New Delhi and the documents
which were sent to them from Delhi branch, they forwarded it to the
NTPC and debited the amount from the account of NTPC. He admitted
that the letter of credit (exhibit P-39) was dated 17.11.1981, which was
of Rs. 24 lakhs and its payment was entered in the register. He further
admitted that on the request of NTPC, his branch had issued a letter of
credit for Rs. 24 lakhs in favour of M/s. Atlantic Engineering Services
Private Limited. The goods which were to be supplied by M/s. Atlantic
Engineering Services Private Limited were to be verified by the officers
of NTPC at New Delhi and after its verification they issued material

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dispatch clearance certificate, which was annexed along with invoice
and Bilti, and then they produced it at their New Delhi branch and then
only the payments were to be made. They have not physically verified
the supply of goods. They have not received any complaint about letter
of credit issued by them, nor any complaint was received at their New
Delhi branch.
PW-12, I.C. Mittal was the officer of State Bank of India, Parliament
19.
Street Branch, who proved the document (exhibit P-41) and bank
account opening form (exhibit P-42). He also proved the specimen
signature card (exhibit P-43) and authorization letter (exhibit P-44).
The minutes of meeting of M/s. Atlantic Engineering Services Private
Limited is exhibit P-45 and P-46. He also stated about the entries in
the ledger (exhibit P-41). In cross-examination, he admitted that, he
himself had not deal with the documents (exhibit P-41 to P-46) and he
could not tell as to who had deal with the same. He also could not
identify the person, whose handwriting are there in the said document.
20. PW-13, Kamlesh Kumar Sharma is the Accountant at NTPC Korba,
who joined there in September, 1981. He stated that the award letter
(exhibit P-1) was issued by the NTPC in favour of M/s. Atlantic
Engineering Services Private Limited for construction work of air-
conditioning and ventilation system at Korba unit. The said award letter
contents with the payment condition clause. He also stated about the
manner and mode of payment. Exhibit P-39 is the letter of credit,
issued in favour of M/s. Atlantic Engineering Services Private Limited,
which was valued Rs. 24 lakhs. He also proved the documents (exhibit
P-46 and P-47) issued by the NTPC. In further examination, he stated

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that along with the document (exhibit P-47), the breakup of prices are
also annexed, which was with respect to the value of the articles
supplied by M/s. Atlantic Engineering Services Private Limited. On
13.05.1982, they wrote a letter (exhibit P-39) to bank for extension of
time of letter of credit and then it was extended up to 30.07.1982 and
they forwarded it to the bank at New Delhi branch. He also admitted
numerous payments from time to time to M/s. Atlantic Engineering
Services Private Limited against various bills and vouchers raised by
them with respect to supply and dispatch of goods. In Para 46 of his
examination, he stated that an amount of Rs. 10,02,703.37/- was
excess paid to M/s. Atlantic Engineering Services Private Limited, but
the same was recovered from their other bills. The recovery of the said
amount was mentioned in the document (exhibit P-96), which is the
general voucher of the NTPC. The amount so recovered, was against
the amount which was to be paid on the site after supply of goods. In
the document (exhibit P-97) he mentioned the goods, which were not
supplied, but payments were made. However, the same were
recovered from M/s. Atlantic Engineering Services Private Limited.
* In cross-examination, he admitted that the document which he
proved in the case, some of them are in his own handwriting and rest
of the documents are in the handwriting of other employees. The
ordered goods have reached to its destination and they received the
same. The documents prepared by the officers of NTPC disclosed that
the goods were received and on the basis of the same, the payments
have been made to M/s. Atlantic Engineering Services Private Limited.
He further admitted that on 20.07.1982, there was a meeting between

15
M/s. Atlantic Engineering Services Private Limited and the officers of
the NTPC and it was settled that as and when the goods were received
on site, they will get its payment. It was also settled in the meeting that,
certain excess payments were made to M/s. Atlantic Engineering
Services Private Limited and it would be adjusted towards supply of
goods and if it would not be paid within 60 days, it would carry penal
interest @ 25%. The meeting was convened for the purposes of
adjustment of supply of goods and excess payment. There is no
dispute with respect to recovery of any payment. He further stated that,
the information about payments to M/s. Atlantic Engineering Services
Private Limited was received by them within 15 to 30 days from Korba
bank. He could not tell, as to whether any information was sent
regarding non-supply of goods, but the payments were made from
Erection Department to Finance Department. He could not tell, as to on
how many occasion the goods were supplied and 60% of its payment
were made.
* From the evidence of this witness, it transpires that though there
were some discrepancies of sending the goods and making payments
for the same, but in the meeting held between M/s. Atlantic
Engineering Services Private Limited and the officers of NTPC, they
settled their dispute and the excess payments were adjusted against
supply of goods and there is no dispute remains about non-supply of
any goods.
21. PW-14, S.K. Sur is the Senior Manager (Erection) at NTPC Korba, who
stated in his evidence that a contract was awarded in favour of M/s.
Atlantic Engineering Services Private Limited for air-conditioning and

16
ventilation work. He was to supervise the progress of work along with
Mr. P.R. Daga, Mr. R.S. Sharma and Mr. L.R. Shrivastava. He also
stated about the manner in which the goods were to be supplied and
the payments were to be made. In his examination-in-chief, he also
proved, which is various transactions of supply of goods and its
payment and would submit in his examination-in-chief that M/s. Atlantic
Engineering Services Private Limited had received payments through
letter of credit for the goods, which were not supplied to them.
* In cross-examination, he stated that as and when the goods
were loaded from Delhi, the officers of NTPC, at Delhi were physically
verified the goods and issued a clearing certificate, then they gave the
said clearance certificate to Delhi bank, which were forwarded to them.
He could not remember, as to whether the supply of goods and its
payment information have been sent to them from the NTPC Delhi or
not. They had a meeting every month and the requirement of goods
were informed to M/s. Atlantic Engineering Services Private Limited.
The construction work was reviewed by them and if they found any
delay in the work, they would inform it to M/s. Atlantic Engineering
Services Private Limited and thereafter in the meeting, the issue was
resolved. He could not tell, as to when they have informed the
concerned engineer of the company. There was an agreement
between the officers of NTPC and M/s. Atlantic Engineering Services
Private Limited with respect to adjustment of the payment against short
supply of goods, which is exhibit P-9. The payments were made to M/s.
Atlantic Engineering Services Private Limited under the letter of credit,
issued in their favour. In further cross-examination, he stated that he

17
did not know as to whether any report was given by the NTPC to the
CBI. He admitted that before 02.06.1986, there was no outstanding
amount between the NTPC and M/s. Atlantic Engineering Services
Private Limited. In Para 32 of his examination, he also has admitted
that there is no double payments made by the NTPC to M/s. Atlantic
Engineering Services Private Limited for the goods, which were
supplied.
PW-15, B.K. Mandal is the Accountant at Erection Section, NTPC,
22.
Korba. During his tenure, he prepared certain general vouchers
(adjustment slip) against dispatched documents. He also proved
various general vouchers, which he prepared. In cross-examination, he
stated that the amount, which the NTPC has adjusted was equal to
55% of the value of the goods supplied under the letter of credit. He
did not know about any transaction at Delhi branch of the bank. The
document (exhibit P-52) is the letter of credit sent by Delhi branch of
the bank to the Korba branch. He admitted that the officers of NTPC,
Delhi inspected the goods, which were to be supplied and issued
dispatch clearance certificate and vehicle number and send it to SBI,
Delhi branch, from where it was sent to SBI, Korba branch and in turn,
they received the same. He did not know about any action taken
against the officers of NTPC or not.
23. PW-16 is the Deputy Manager (Contract) at NTPC, New Delhi. He also
stated in his evidence that a contract was awarded in favour of M/s.
Atlantic Engineering Services Private Limited and payments were to be
made for the work done through the letter of credit. There was a
reconciliation meeting and a statement (exhibit P-6) was prepared,

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which was dated 25.02.1983 and after adjustment there was an
outstanding amount of Rs. 83,546.78/- in favour of M/s. Atlantic
Engineering Services Private Limited, but they overdue Rs.
9,91,891.30/- from SBI, Delhi branch through letter of credit. Another
meeting was held on 24.03.1983 between the officers of NTPC and
M/s. Atlantic Engineering Services Private Limited and the document
(exhibit P-3) was prepared. About Rs. 20 lakhs were paid to M/s.
Atlantic Engineering Services Private Limited by NTPC, out of which
about Rs. 10,02,000/- was paid by the NTPC to the bank and Rs.
9,98,000/- was outstanding against NTPC.
* In cross-examination, he stated that he was not the part of the
contract, which was executed in the year 1980. The payment under the
award of work was in various installments after the supply of goods in
various stages. He admitted that after verification of the goods at Delhi,
payments were to be made for the said goods. He could not tell as to
whether any payment was made to M/s. Atlantic Engineering Services
Private Limited for supply/non-supply of goods. He further stated that
the reconciliation meeting was convened for the purposes to know
about outstanding amount, if any. He also did not see any letter or
complaint with respect to non-supply of goods. He also shown his
ignorance about any action taken against such act of M/s. Atlantic
Engineering Services Private Limited. The amount which was overdue
by M/s. Atlantic Engineering Services Private Limited was to be repaid
along with penal interest @ 25% and it was settled in the meeting held
on 24.03.1983. He did not know about other reconciliation meeting. He

19
also did not know about any further dispute between them after March
1983.
PW-17, R.C. Dhoop is the Senior Engineering, NTPC, New Delhi. He
24.
stated in his evidence that after inspection of the material, the material
dispute certificate was to be issued. The reports were to be supplied to
the contractor and concerned inspection office and after issuance of
MBCC, the liability of inspection department is over. The payments
were to be made on the basis of MBCC. The certificate (exhibit P-86)
was issued by his subordinate Mr. Balakrishnan after physical
verification of the goods. He also proved various MBCC issued with
respect to supply of goods. In cross-examination, the inspection was
done under the conditions of letter of award executed between the
NTPC and M/s. Atlantic Engineering Services Private Limited. They
have no responsibility to inspect the value of the goods and they can
only check the quality and specifications of the goods. He admitted
that during the entire proceeding, various different persons have done
the physical verification of the goods. He further admitted that in the
document (exhibit P-86) it is mentioned that it is verified on the spot.
Sometimes it has been written for the reason that the materials were
lying in the store. He further admitted that the payments were made on
the basis of MBCC issued by their department. He also shown his
ignorance about payments made through various MBCC and stated
that he did not personally know about the supply of goods. He did not
know, what wrong has been occurred in the case.
25. PW-18, R.K. Kaul was the Supervisor in the Inspection department. He
was assigned duty of quality check of the goods and the certificate

20
issued by the contractor and thereafter, they issued MBCC. The MBCC
(exhibit P-62A) was issued by him, in which the report issued by the
manufacturer (exhibit P-139) and report of the contractor (exhibit P-
140) were annexed. Likewise, he also issued other MBCC (exhibit P-
61, P-68, P-80) and other documents of the subject transactions. In
cross-examination, he stated that, he submitted the inspection report
on the instruction of his senior officer. He did not know, as to whether
payments were made with respect to goods mentioned in exhibit P-94
and P-144. He did not know about the meeting convened between the
officers of NTPC and M/s. Atlantic Engineering Services Private
Limited in the year 1982 and what negotiation were there in the said
meeting. He also admitted that he did not know as to supply of goods
mentioned in the MBCC. He physically verified the goods mentioned in
the document (exhibit P-68) and found the goods there.
PW-18, Jaiveer Singh was the Supervisor Grade-I at NTPC Delhi. He
26.
issued MBCC exhibit P-66 on 12.02.1982, exhibit P-109 on 07.04.1983
and material certificate exhibit P-108 on 18.05.1983. In cross-
examination he admitted that, he found the relevant goods on the spot
at the time of its inspection, he did not know about its payment.
27. PW-21, Prakashchand Wahi is the Contractor and Manager at Jeet
Interstate Carrier, Delhi. To the documents (exhibit P-69 and P-56), his
truck had transported goods to NTPC Korba from Delhi. The vehicle
movement was endorsed in challan book (exhibit P-156). His truck has
transported goods on 28.01.1982 and 09.02.1982 From Delhi to
Korba. The truck number has wrongly been mentioned in the
documents (exhibit P-59, P-56 and P-155). In cross-examination, he

21
did not know about the change of the name of the transport company.
He admitted that whenever a truck was being hired from the transport
company, the transport receipt was being issued by transporter. He
admitted that, he did not know about loading of goods on 15.02.1982
from Orient speed through the document (exhibit P-69). He admitted
that his truck has often gone to Korba from Delhi. He further admitted
that he also given their trucks to other transport companies. He further
admitted that the challan book was issued from January, 1982. He also
did not contact with the truck owner Jasveer Singh. He never
contacted with Orient mail speed transport company with respect to
the transport receipt of transportation of goods from Delhi to Korba. He
also did not tell it to the CBI. He further admitted that in the challan
receipt No. 4656, the vehicle number has not been mentioned for the
reason that it was booked from other transport company.
PW-22, A.D. Shrivastava, was the Senior Engineer at Inspector
28.
Services NTPC. He issued MBCC (exhibit P-52) on 23.01.1982. The
document (exhibit P-157) was issued by M/s. Atlantic Engineering
Services Private Limited, which was given to the Quality Assurance
Manager, NTPC, New Delhi and an inspection report was also
annexed thereto. He also issued other MBCCs with respect to supply
of goods and he stated that he did not know as to whether the goods
were reached to its destination or not. He was assigned work to
prepare MBCC and not related to verifying as to whether goods
actually supplied or not. In cross-examination, after physical
verification he issued the document (exhibit P-52, P-157 and P-157A).

22
The MBCC was prepared in 6 copies for different sections. He was
never inquired from the department about issuance of MBCC.
PW-23, Ramsharan Sharma is the Deputy Manager, NTPC, Korba. He
29.
stated in his evidence that, a contract was awarded in favour of M/s.
Atlantic Engineering Services Private Limited for air-conditioning and
ventilation system at NTPC Korba, which was being supervised by
S.K. Sur. He received a letter (exhibit P-159) with respect to non-
performing of the terms of the conditions of the work order. The letter
issued by M/s. Atlantic Engineering Services Private Limited (exhibit P-
161) for issuance of letter of credit was forwarded by him to Mr. S.K.
Sur and also forwarded the letter (exhibit P-162) for its confirmation.
By the letter (exhibit P-163) a request was made for extension of time
of letter of credit up to 30.04.1982. He also issued the letter (exhibit P-
164) for status of material supplied and exhibit P-165 to SBI
Parliament Street Branch, New Delhi for negotiation of scheduled of
items. During his tenure, he also wrote various letters to the concerned
department with respect to status of material supplied by M/s. Atlantic
Engineering Services Private Limited under the award of work. He also
raised objection about non-supply of goods by M/s. Atlantic
Engineering Services Private Limited and there was meeting on
01.05.1982 between officers of NTPC and M/s. Atlantic Engineering
Services Private Limited at Delhi. In the said meeting, they requested
for revalidate the letter of credit and negotiations were done between
them and the document (exhibit P-4) was executed. In his
examination-in-chief, he disclosed the negotiation meeting between
the parties and review of letter of credit. In cross-examination, he

23
stated that the inspection of the goods was under the terms of the work
order, which was carried out by the employees of the NTPC. He
admitted that the certificate was to be issued after inspection as per
the terms of the work order. At the time when the work was executed.
He was not posted in the Erection department. He also admitted the
recovery of excess payment along with the panel interest, he could not
tell as to whether the goods are supplied or not, for which the
payments were made. He did not know about the meeting convened
between NTPC and M/s. Atlantic Engineering Services Private Limited.
He has the knowledge that under the reconciliation, the amount has
been adjusted against supply of goods. He also did not know about
any action taken against the officers of NTPC.
PW-24, C.P. Chawla was an officer of SBI Parliament Street Branch,
30.
New Delhi. He stated in his evidence that a revolving LC for Rs. 24
lakhs was opened in favour of M/s. Atlantic Engineering Services
Private Limited on 17.11.1981, which is exhibit P-184. A current
account was also opened in favour of M/s. Atlantic Engineering
Services Private Limited at Parliament Street Branch, which is exhibit
P-42. He was well aware about the document of M/s. Atlantic
Engineering Services Private Limited. He certified certain transactions
in the bank account of M/s. Atlantic Engineering Services Private
Limited from NTPC Korba. The bills have also been attached with the
letter of credit and the current account payslip voucher is exhibit P-
185. He is the witness with respect to the banking transactions in
between NTPC Korba and M/s. Atlantic Engineering Services Private
Limited through the letter of credit and proved various vouchers and

24
proceeding of the bank, which he approved during his tenure. He
stated in his evidence about payments made to M/s. Atlantic
Engineering Services Private Limited at various occasions on the basis
of bills and letter of credit. In cross-examination, he stated that the
material dispatch clearance was being issued by NTPC. M/s. Atlantic
Engineering Services Private Limited was also issuing undertaking
owing his responsibility. Though in the document (exhibit P-184), there
was no mention of any undertaking, but at the time of submission of
document by the concerned party, he was required to mention it in the
document. The payments were made after verification of relevant
documents. Along with the document (exhibit P-52), the material
dispatch clearance certificate was annexed and on the basis of that
payments were made. They were not required to verify about supply of
goods. After making payment, the necessary information were being
sent to NTPC Korba. Exhibit D-6 is the material clearance certificate
annexed with the bill (exhibit P-54) and payments were made on that
basis. Likewise, the relevant documents were also annexed along with
the bills (exhibit P-55 to P-58, P-76, P-79, P-85 and P-82) and
payments were made. NTPC Korba has never made any complaint
about any excess payment.
PW-25, M.B. Dubey was the Branch Manager, SBI Korba. He stated
31.
that on 17.11.1981, an application was submitted by NTPC Korba for
opening of letter of credit of Rs. 24 lakhs in favour of M/s. Atlantic
Engineering Services Private Limited, which is exhibit P-46 and after
verification of the document, they opened LC, which is exhibit P-39.
The relevant forwarding letter is exhibit P-197. They also forwarded a

25
letter (exhibit P-48) for extension of time of validity of LC from
30.04.1982 onward and it was extended up to 30.07.1982 through the
letter (exhibit P-50). He also proved various bills under the LC and the
payments made towards those bills. In cross-examination, he shown
his ignorance about terms of the agreement between NTPC Korba and
M/s. Atlantic Engineering Services Private Limited. The LC was
opened on the instance of NTPC Korba. The SBI Korba branch has not
made any payment to M/s. Atlantic Engineering Services Private
Limited.
PW-27, S.P. Mukharjee was the Deputy Manager, NTPC Korba and
32.
was assigned duty of mechanical axillary packages and supervision of
air-conditioning and ventilation package. He witnessed the tender
process and after completion of tender process, work order was issued
in favour of M/s. Atlantic Engineering Services Private Limited. He is
the witness of awarding contract and tender process.
33. PW-28, D.D. Goyal is the State Examiner of Questioned Documents.
He stated in his evidence that in the month of March 1988, he received
a letter from Superintendent of Police, CBI, Jabalpur (exhibit P-199) for
examination of questioned writing Q-1 to Q-51 and admitted
handwriting A-1 to A-14 and specimen handwriting S-1 to S-40. After
its examination, he gave his report, which is exhibit P-204. He also
explained in detail of the comparison between the questioned,
admitted and specimen handwriting over the documents. In cross-
examination, he stated that he has no any educational qualification for
examination of handwriting, but he obtained 4 years training and
cleared departmental examination. He does not have any document of

26
the experience of 40 years. At the relevant time, he was posted as
State Examiner of Questioned Documents. In the document (exhibit P-
199), the name of the concerned persons have not been disclosed. He
came to know about their names from the documents in which their
names have been mentioned above their signatures. He along with
one Santokh Singh examined the documents. He admitted that in the
documents (exhibit P-11 to P-13, P-52, P-54A and P-85), only the seal
of their department is affected, but no signature of any officer is there.
He admitted that the specimen signature has not been taken in his
presence. The photographs of specimen signatures have not been
taken by him. He also has not inspected the documents available in
the court record.
PW-30, Bihari Lal Sidana was a transporter. He stated in his evidence
34.
that, the office of M/s. Atlantic Engineering Services Private Limited
was situated in front of his transport office and in routine course of their
business, they contacted M/s. Atlantic Engineering Services Private
Limited and then they started transportation of their goods. The police
has seized certain documents through seizure memo (exhibit P-206)
and goods challan receipts (exhibit P-207 to P-219). The letter (exhibit
P-220) was written by Devendra Sandhu, which relates to handover of
03 advanced GR to Mandeep Singh. He also proved the GR (exhibit P-
221 to P-223). In cross-examination, he stated that after May-June
1982 he was the proprietor of the firm. He was having two trucks
through which he engaged in business with M/s. Atlantic Engineering
Services Private Limited. He transported the goods of M/s. Atlantic
Engineering Services Private Limited from Delhi to Korba NTPC and

27
he transported the goods for 80-85 times. The payments were made
through the cheque by M/s. Atlantic Engineering Services Private
Limited and certain payments are still outstanding. CBI has recorded
his statement. The transaction between M/s. Atlantic Engineering
Services Private Limited and NTPC Korba was started in the year
1981-82 and there was no any complaint about the goods transported
by him. He was being detailed cross-examined by the defence with
respect to the GR and transportation of goods, various vouchers,
receipts and delivery challan. He admitted that between 1980 to 1983,
he was having business relation with M/s. Atlantic Engineering
Services Private Limited, but no complaint has been made between
that.
PW-31 was the Manager Contract Services, NTPC and was posted at
35.
Korba project. He proved the award letter dated 15.10.1980 (exhibit P-
1), the supply of goods and payment conditions under the clauses of
the award (exhibit P-1). He stated in his evidence that since M/s.
Atlantic Engineering Services Private Limited has not furnished any
bank guarantee, he requested NTPC that payment of 55% against
dispatch of goods may be made in place of 60% and 15% payment
may be made after delivery of goods. He also proved the document
(exhibit P-52 to P-61). The Deputy Manager, S.K. Sur has prepared a
list of goods, which were not supplied by M/s. Atlantic Engineering
Services Private Limited. Exhibit P-9 is a document, which was
prepared after conciliation meeting between them. The document
(exhibit P-225) is the report prepared after meeting between NTPC
Korba and M/s. Atlantic Engineering Services Private Limited. In cross-

28
examination, he admitted that the award letter (exhibit P-1) has not
been prepared by him. He was not a member in conciliation meeting
between the parties. He deposed on the basis of the documents
available to him. He was not a party to the documents (exhibit P-9 and
P-225) and he does not have any personal knowledge about the
proceedings of the meeting. He also did not know about transportation
of goods.
PW-32, Mukesh Chandra Sahni is the Superintendent of Police, CBI
36.
New Delhi and Investigating Officer of the case. He being the
procedural witness has proved the process of investigation, which he
conducted and the documents prepared during the investigation. In his
evidence, he admitted that during investigation he does not find any
criminal misconduct against the officers of NTPC. He also admitted
that the documents (exhibit P-52 to P-89) were issued by the officers of
Inspection section after physical verification. He also admitted that
during investigation Mr. S.K. Sandhu had verified that the GR
certificates have been issued on the basis of documents submitted by
the concerned party. He has also admitted that there was a meeting in
the year 1982-83 between the officers of NTPC and M/s. Atlantic
Engineering Services Private Limited and the documents (exhibit P-3,
P-4 and P-6) were prepared with respect to adjustment of the goods
supplied and payments made and in pursuance thereof, the NTPC had
received Rs. 10 lakhs. Thereafter, Rs. 2 lakhs was to be received by
M/s. Atlantic Engineering Services Private Limited and thereafter he
did not know about any other payments. He further admitted that the

29
goods which could not supplied earlier through GR, have been
subsequently supplied.
The accused S.S. Sandhu has examined himself as DW-2 and he
37.
proved the details of transaction and explained the transactions
between M/s. Atlantic Engineering Services Private Limited and NTPC.
He deposed in his evidence the each and every steps about their
transactions and the manner in which they deal with the terms of the
work order with the NTPC. This witness has not been cross-examined
by the prosecution/CBI.
38. Upon re-appreciation of the oral and documentary evidence available
on record, this Court finds that the main question for consideration is
whether the prosecution has established beyond reasonable doubt that
the respondents/accused persons, in furtherance of a criminal
conspiracy, dishonestly induced the NTPC to make payments of
approximately Rs. 20 lakhs against goods allegedly not supplied and
thereby committed the offences punishable under Sections 120-B and
420 of the Indian Penal Code. It is well settled that, in an appeal
against acquittal, the appellate court is empowered to re-appreciate
the evidence; however, interference with an order of acquittal is
warranted only when the findings recorded by the court below are
perverse, manifestly illegal or otherwise unsustainable in law. Where
the view taken by the court acquitting the accused is a reasonable and
plausible view based upon the evidence on record, the mere possibility
of another view does not justify reversal of the acquittal.

30
Applying the law governing the scope of interference in an appeal
39.
against acquittal, the Hon’ble Supreme Court in the case of State of
Rajasthan v. Kistoora Ram , reported in 2022 SCC OnLine SC 984,
has held as follows:
“8. The scope of interference in an appeal against
acquittal is very limited. Unless it is found that the
view taken by the Court is impossible or perverse,
it is not permissible to interfere with the finding of
acquittal. Equally if two views are possible, it is
not permissible to set aside an order of acquittal,
merely because the Appellate Court finds the way
of conviction to be more probable. The
interference would be warranted only if the view
taken is not possible at all.”
Further, in the case of Jafarudheen and Others v. State of Kerala ,
40.
reported in (2022) 8 SCC 440, the Hon’ble Supreme Court, while
considering the scope of interference in an appeal against acquittal,
has held in paragraph 25 as under:
“25. While dealing with an appeal against
acquittal by invoking Section 378 of the Cr.P.C.,
the Appellate Court has to consider whether the
Trial Court’s view can be termed as a possible
one, particularly when evidence on record has
been analyzed. The reason is that an order of
acquittal adds up to the presumption of innocence
in favour of the accused. Thus, the Appellate
Court has to be relatively slow in reversing the
order of the trial court rendering acquittal.
Therefore, the presumption in favour of the
accused does not get weakened but only
strengthened. Such a double presumption that

31
ensures in favour of the accused has to be
disturbed only by thorough scrutiny on the
accepted legal parameters.”
41. Similarly, in the case of Central Bureau of Investigation v. Shyam
Bihari and Others , reported in (2023) 8 SCC 197, the Hon’ble
Supreme Court has held in paragraph 27 as follows:
“27. It is trite law that in an appeal against
acquittal, the power of appellate court to re
appreciate evidence and come to its own
conclusion is not circumscribed by any limitation.
But it is equally settled that the appellate court
must not interfere with an order of acquittal
merely because a contrary view is permissible,
particularly, where the view taken by the trial court
is a plausible view based on proper appreciation
of evidence and is not vitiated by
ignorance/misreading of relevant evidence on
record.”
The Hon’ble Supreme Court in Tulasareddi @ Mudakappa & Another
42.
v. The State of Karnataka reported in 2026 SCC Online SC 89, held
that:
“27. In the case of Babu Sahebagouda
1
Rudragoudar v. State of Karnataka this Court
held in paragraphs 39 to 42 as under:
39. This Court in Rajesh Prasad v. State of
2
Bihar encapsulated the legal position
covering the field after considering various
1 . 2024 (8) SCC 149
2 . (2022) 3 SCC 471 : (2022) 2 SCC (Cri) 31

32
earlier judgments and held as below : (SCC
pp.482-83, para 29)
29. After referring to a catena of judgments,
this Court culled out the following general
principles regarding the powers of the
appellate court while dealing with an appeal
against an order of acquittal in the following
3
words: (Chandrappa v. State of Karnataka ,
para 42)
‘42. From the above decisions, in our
considered view, the following general
principles regarding powers of the appellate
court while dealing with an appeal against
an order of acqu i ttal emerge:
(1) An appellate court has full power to
review, reappreciate and reconsider the
evidence upon which the order of acquittal is
founded.
(2) The Criminal Procedure Code, 1973 puts
no limitation, restriction or condition on
exercise of such power and an appellate
court on the evidence before it may reach its
own conclusion, both on questions of fact
and of law.
(3) Various expressions, such as,
“substantial and compelling reasons”, “good
and sufficient grounds”, “very strong
circumstances”, “distorted conclusions”,
“glaring mistakes”, etc. are not intended to
curtail extensive powers of an appellate
court in an appeal against acquittal. Such
phraseologies are more in the nature of
3 . (2007) 4 SCC 415 : (2007) 2 SCC (Cri)325], SCC p. 432

33
“flourishes of language” to emphasise the
reluctance of an appellate court to interfere
with acquittal than to curtail the power of the
court to review the evidence and to come to
its own conclusion.
(4) An appellate court, however, must bear
in mind that in case of acquittal, there is
double presumption in favour of the
accused. Firstly, the presumption of
innocence is available to him under the
fundamental principle of criminal
jurisprudence that every person shall be
presumed to be innocent unless he is
proved guilty by a competent court of law.
Secondly, the accused having secured his
acquittal, the presumption of his innocence
is further reinforced, reaffirmed and
strengthened by the trial court.
(5) If two reasonable conclusions are
possible on the basis of the evidence on
record, the appellate court should not
disturb the finding of acquittal recorded by
the trial court.’
40. Further, in H.D. Sundara v. State of
4
Karnataka , this Court summarised the
principles governing the exercise of
appellate jurisdiction while dealing with an
appeal against acquittal under Section 378
CrPC as follows : (SCC p. 584, para 8)
“8. … 8.1. The acquittal of the accused
further strengthens the presumption of
innocence;
4. (2023) 9 SCC 581 : (2023) 3 SCC (Cri) 748]

34
8.2. The appellate court, while hearing an
appeal against acquittal, is entitled to
reappreciate the oral and documentary
evidence;
8.3. The appellate court, while deciding an
appeal against acquittal, after reappreciating
the evidence, is required to consider
whether the view taken by the trial court is a
possible view which could have been taken
on the basis of the evidence on record;
8.4.If the view taken is a possible view, the
appellate court cannot overturn the order of
acquittal on the ground that another view
was also possible; and
8.5. The appellate court can interfere with
the order of acquittal only if it comes to a
finding that the only conclusion which can
be recorded on the basis of the evidence on
record was that the guilt of the accused was
proved beyond a reasonable doubt and no
other conclusion was possible.”
41. Thus, it is beyond the pale of doubt that
the scope of interference by an appellate
court for reversing the judgment of acquittal
recorded by the trial court in favour of the
accused has to be exercised within the four
corners of the following principles:
41.1. That the judgment of acquittal suffers
from patent perversity;
41.2. That the same is based on a
misreading/omission to consider material
evidence on record; and

35
41.3. That no two reasonable views are
possible and only the view consistent with
the guilt of the accused is possible from the
evidence available on record.
42. The appellate court, in order to interfere
with the judgment of acquittal would have to
record pertinent findings on the above
factors if it is inclined to reverse the
judgment of acquittal rendered by the trial
court.
*
“29. From the aforesaid decisions rendered
by this Court, it can be said that if two
reasonable conclusions are possible on the
basis of the evidence on record, the
Appellate Court should not disturb the
findings of acquittal recorded by the Trial
Court. Further, if the view taken is a possible
view, the Appellate Court cannot overturn
the order of acquittal on the ground that
another view was also possible. The
following principles have to be kept in mind
by the Appellate Court while dealing with the
appeals against an order of acquittal:
(a) whether the judgment of acquittal suffers
from patent perversity;
(b) whether the judgment is based on
misreading/omission to consider the
material evidence on record;
(c) an order of acquittal is to be interfered
with only when there are “compelling and
substantial reasons” for doing so. If the

36
order is “clearly unreasonable”, it is a
compelling reason for interference.’
(d) the appellate court, while deciding an
appeal against acquittal, after reappreciating
the evidence, is required to consider
whether the view taken by the trial court is a
possible view which could have been taken
on the basis of the evidence on record;
(e) if the view taken is a possible view, the
appellate court cannot overturn the order of
acquittal on the ground that another view
was also possible; and
(f) the appellate court can interfere with the
order of acquittal only if it comes to a finding
that the only conclusion which can be
recorded on the basis of the evidence on
record was that the guilt of the accused was
proved beyond a reasonable doubt and no
other conclusion was possible.”
In the present case, the prosecution has relied upon the testimony of
43.
certain witnesses to establish that the vehicles mentioned in the
disputed transport receipts had not transported the goods to NTPC,
Korba. However, upon examination of their depositions, it is apparent
that their testimony suffers from material limitations concerning their
personal knowledge of the movement of the vehicles and the relevant
transportation transactions. PW-5 Rohtan Singh admitted that the
entries in the gate register were made by security guards, whose
identity and handwriting he could not establish. PW-7 Sardar Singh
and PW-9 Makhan Singh also could not produce reliable records of the
movement of the vehicle in question during the relevant period.

37
Similarly, PW-10 Jaspal Singh could not establish the relevant vehicle
movements from his personal knowledge. On the other hand, the
evidence of the NTPC officials, including PW-13 Kamlesh Kumar
Sharma, PW-14 S.K. Sur and PW-16, the Deputy Manager (Contract),
establishes that disputes concerning the supply of goods and excess
payments were considered in meetings between the representatives of
NTPC and M/s. Atlantic Engineering Services Private Limited. The
evidence further indicates that certain excess payments were
recovered or adjusted against subsequent supplies, and the accounts
between the parties were reconciled. Thus, the evidence relating to the
alleged non-supply of goods cannot be considered in isolation from the
subsequent supplies, adjustments and reconciliation of accounts
established by the prosecution evidence itself.
Another significant circumstance is that the payments under the letter
44.
of credit were made on the basis of the prescribed documents,
including the material dispatch clearance certificates issued by the
concerned NTPC officials after inspection of the goods. The evidence
of the bank officials establishes that the bank processed the
documents in accordance with the procedure governing the letter of
credit and did not independently verify the physical supply of the
goods. Further, the prosecution witnesses acknowledged that the
validity of the letter of credit was extended from time to time and that
meetings were held between the parties to reconcile the accounts. The
statement of reconciliation, Exhibit P-6, prepared on 25.02.1983,
reflected an amount of Rs. 83,546.78 as payable by NTPC to M/s.
Atlantic Engineering Services Private Limited. The evidence of PW-13

38
and PW-14 also supports the conclusion that excess payments were
adjusted against subsequent supplies and that there was no
outstanding amount between the parties at the relevant stage.
Although the extension of the letter of credit, continuation of the
contract and reconciliation of accounts cannot, by themselves,
conclusively exclude the possibility of a criminal offence, these
circumstances assume significance when considered cumulatively with
the documentary evidence and the admissions made by the
prosecution witnesses. They lend support to the defence that the
discrepancies arose in the course of contractual performance and
subsequent reconciliation, rather than necessarily from a dishonest
intention existing at the inception of the transactions.
The defence has further examined S.S. Sandhu as a defence witness,
45.
who explained the transactions between the company and NTPC,
including the meetings held for reconciliation of accounts and the
subsequent adjustment of payments against supplies. His testimony
remained unchallenged in cross-examination by the prosecution.
Significantly, his evidence finds corroboration in the documents and
circumstances emerging from the prosecution evidence itself,
particularly the minutes of the meetings, the reconciliation statement
and the evidence concerning recovery of excess payments and
subsequent supply of goods. The investigating officer, PW-32 Mukesh
Chandra Sahni, also admitted that meetings had taken place between
the representatives of NTPC and the company during 1982-83, that
documents concerning adjustment of goods supplied and payments
made had been prepared, and that goods which could not be supplied

39
earlier under certain goods receipts had subsequently been supplied.
In these circumstances, the evidence does not satisfactorily establish
that the respondents had entered into an agreement to commit an
illegal act or had acted with a dishonest intention from the inception of
the transactions. Mere discrepancies in the supply of goods or receipt
of payments under a commercial contract, without cogent evidence
establishing the requisite criminal intention and the agreement
constituting conspiracy, are insufficient to sustain convictions under
Sections 420 and 120-B of the Indian Penal Code. The prosecution
has, therefore, failed to establish the essential ingredients of the
alleged offences beyond reasonable doubt.
While considering the present appeal against acquittal, this Court is
46.
conscious of the settled principle of law that, although the appellate
Court has full power to reappreciate the evidence on record,
interference with a judgment of acquittal is warranted only when the
findings recorded by the Court below are perverse, unreasonable, or
based on misappreciation or omission of material evidence. The
acquittal of the respondent further reinforces the presumption of
innocence, and where the view taken by the Court below is a plausible
view based on the evidence available on record, the same cannot be
displaced merely because another view is also possible. Therefore, the
evidence and the findings recorded by the Court below must be
examined in the light of these settled principles to determine whether
the judgment of acquittal suffers from any legal infirmity warranting
interference by this Court.

40
The same evidence also falls short of establishing the offence of
47.
cheating under Section 420 of the IPC. The essential ingredients of
cheating include deception and fraudulent or dishonest inducement,
accompanied by the requisite dishonest intention. The Hon’ble
Supreme Court has repeatedly held that the dishonest or fraudulent
intention must exist at the inception of the transaction and cannot be
presumed merely from a subsequent breach, omission or irregularity.
In V.Y. Jose v. State of Gujarat , (2009) 3 SCC 78, and in subsequent
decisions, the Hon’ble Supreme Court has reiterated that:-
“14. An offence of cheating cannot be said to
have been made out unless the following
ingredients are satisfied:
(i) deception of a person either by
making a false or misleading
representation or by other action or
omission;
(ii) fraudulently or dishonestly inducing
any person to deliver any property; or
to consent that any person shall retain
any property and finally intentionally
inducing that person to do or omit to
do anything which he would not do or
omit.
For the purpose of constituting an offence of
cheating, the complainant is required to show
that the accused had fraudulent or dishonest
intention at the time of making promise or
representation. Even in a case where
allegations are made in regard to failure on
the part of the accused to keep his promise,
in the absence of a culpable intention at the
time of making initial promise being absent,

41
no offence under Section 420 of the Penal
Code can be said to have been made out.”
48. So far as the allegation of criminal conspiracy is concerned, the
prosecution was required to establish, by cogent and reliable evidence,
an agreement or meeting of minds between the accused persons to
commit an illegal act or to accomplish a lawful act by illegal means. In
the present case, the officers of NTPC, whose alleged acts or
omissions were material to the transaction in question, have not been
arrayed as accused. Mere irregularities in the transaction or the
alleged involvement of the accused persons, in the absence of
evidence establishing a prior agreement or concerted action to commit
the alleged offence, would not be sufficient to prove the charge of
criminal conspiracy. The prosecution has not brought on record any
direct or circumstantial evidence establishing such an agreement or
meeting of minds. Accordingly, the essential ingredients of criminal
conspiracy cannot be said to have been established merely on the
basis of suspicion or inference drawn from the circumstances of the
case.
It is also pertinent to note that no complaint was lodged by NTPC in
49.
respect of the alleged transaction, and the alleged offences pertain to
the period 1981–1982, whereas the FIR came to be registered by the
CBI only in the year 1986. Although the absence of a complaint by
NTPC and the delay in registration of the FIR are not, by themselves,
sufficient grounds to quash the criminal proceedings, these
circumstances assume significance when considered alongside the
other material available on record. In the absence of a complaint from

42
the concerned organisation, any cogent material demonstrating the
commission of the alleged offences, or a satisfactory explanation for
the delay, the allegations require careful scrutiny to determine whether
the essential ingredients of the offences are made out. If the material
collected during the investigation fails to disclose a prima facie case
against the accused, continuation of the criminal proceedings would
not be justified merely on the basis of suspicion or inference.
In view of the foregoing discussion, this Court finds that the learned
50.
appellate court has assessed the evidence in its entirety and arrived at
a view that is reasonably supported by the oral and documentary
evidence on record. The material circumstances concerning the
extension of the letter of credit, the meetings between the parties, the
reconciliation of accounts, the recovery or adjustment of excess
payments and the subsequent supply of goods provide a reasonable
basis for extending the benefit of doubt to the respondents. The
prosecution has failed to establish that the respondents acted pursuant
to a criminal conspiracy or that they dishonestly induced NTPC to
make payments with the requisite intention to cheat. Consequently, the
findings recorded by the learned appellate court do not suffer from any
perversity or illegality warranting interference by this Court in the
present appeal against acquittal.
51. Accordingly, the appeal against acquittal is dismissed , and the
judgment of acquittal dated 13.09.2019 passed by the learned Special
Judge, Special Court for trial of CBI cases, Raipur, acquitting the
respondents of the offences punishable under Sections 120-B and 420
read with Section 120-B of the Indian Penal Code, is hereby affirmed.

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Let a copy of this judgment and the original records be transmitted to
52.
the trial Court concerned forthwith for necessary information and
compliance.
Sd/-
(Ravindra Kumar Agrawal)
Judge
ved