V. Balakrishnan vs State Rep By The Deputy Superintendent Of Police
- Court
- Supreme Court
2026 INSC 936
Non-Reportable
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
Criminal Appeal No. 2460 of 2026
V. Balakrishnan
...Appellant(s)
Versus
State Rep by the Deputy
Superintendent of Police
...Respondent(s)
J U D G M E N T
K.VINOD CHANDRAN, J.
The sole accused, A1, convicted among the five arrayed
by the prosecution, is before us challenging his conviction and
the sentence imposed. A2 and A4 died before the charges
were framed and A3 was bedridden, in which circumstance
the trial against him was split up. He is said to have expired
now. The trial was conducted against A1 and A5, of which, the
latter was acquitted.
2. Heard Sri S. Nagamuthu, learned Senior Counsel for the
appellant and Sri Davinder Pal Singh, learned Additional
Signature Not Verified
Solicitor General for the respondent.
Digitally signed by
CHANDRESH
Date: 2026.09.01
18:37:30 IST
Reason:
Criminal Appeal No. 2460 of 2026 Page 1 of 13
3. The charges against A1 were under Section 420 of the
1
Indian Penal Code, 1860 read with Section 120B and Section
13(2) read with 13(1)(d) of the Prevention of Corruption Act,
1988.
4. A1 was working as a Branch Manager at the Indian
Bank, Anna Nagar Branch, in the year 1991 and A2, an
acquaintance, was a retired officer of the Indian Overseas
Bank. The allegation is that with A2’s connivance, A1
sanctioned loans in favour of A4 and A5, which in fact was
appropriated by A2. A4 was a washerman, working in the
house of A2, who had opened a current account in the branch,
in which A1 was the Branch Manager. A1 recommended a loan
of Rs.13,50,000/- for A4, styling A4 as a real estate
businessman. A1 had also hurriedly sanctioned Rs.3,30,000/-
to A4, even before the loan was sanctioned. The amount was
disbursed to A2, who signed on the back of the cheque,
confirming the receipt of cash.
5. Insofar as A5 is concerned, a loan of Rs.10,00,000/- was
sanctioned for purchase of 21.39 acres of land. A3, a property
1
In short ‘IPC’
Criminal Appeal No. 2460 of 2026 Page 2 of 13
appraiser of the Indian Bank issued a certificate showing
enhanced value for the property which had led to the loan
sanction. On A2’s introduction, A1 also sanctioned another
loan to A5, allegedly on the recommendation of an Income Tax
Officer, communicated by the office of the Managing Director,
Indian Bank. The loan sanctioned was also disbursed by way
of a cheque to A2, who signed on the back of the cheque.
6. The Investigating Officer (I.O) found the bank having
been cheated of the amounts disbursed as loan. It is an
admitted fact that the loan amounts have been satisfied and
there is no outstanding, insofar as the loan accounts are
concerned.
7. The prosecution examined PW1-PW13 and marked
Exhibits P1-P86 documents. There were no witnesses
examined on behalf of the defence, who marked Exhibits D1-
D12. The prosecution went to trial with the case that A1, while
he was the Branch Manager of Anna Nagar Branch of Indian
Bank, in collusion with A2, a retired officer of the Indian
Overseas Bank, sanctioned loans to A4 and A5 who were
domestic helps in the employment of A2. Though, the lands
Criminal Appeal No. 2460 of 2026 Page 3 of 13
were mortgaged as against the loans availed, the valuation
was grossly enhanced by A3, the property appraiser engaged
by the Indian Bank.
8. PW1 was the person who issued the sanction to
prosecute A1. He is a retired General Manager of the Indian
Bank, who was working as a Scale VII Officer in the Head Office
at Chennai between 1995-1998 and the Competent Authority,
insofar as disciplinary actions are concerned, with respect to
Scale III officers; which post A1 was holding. In cross-
examination, PW1 has admitted that the loans in respect of A4
and A5 were both sanctioned by the Assistant General
Manager of the Regional Office of Indian Bank, Madras North.
The bank initiated recovery proceedings and with respect to
A5’s property, the same was auctioned and the bank received
an amount of Rs.1,17,50,000/-, out of which, the arrears in the
loan account at Rs.16,42,397/- was adjusted. With respect to
the loan availed by A4, on auction of the mortagaged
properties, Rs.2,42,00,000/- was received, out of which,
Rs.5,35,550/- was appropriated towards the loan account. A
further property of A5 was auctioned with Rs.34,50,000/- and
Criminal Appeal No. 2460 of 2026 Page 4 of 13
the amount is said to have been appropriated towards the loan
account. In fact, the specific statement in cross-examination, is
that, Kumaradevan-A2 had abused his official position, while
the sanction was granted as against V. Balakrishnan-A1.
9. PW2 and PW3 were officers working in the Indian Bank,
the former, a Senior Manager, working in the Regional Office
at Madras North; under which jurisdiction Anna Nagar Branch
was functioning and the latter, an Assistant Manager who was
working in Anna Nagar Branch along with A1 and designated
with the job of a Loan Officer in the loan section of the branch.
PW2 marked the various documents with respect to the
sanction of the loans and also affirmed that there was sanction
from the Regional Office. Insofar as A5 was concerned,
Rs.10,00,000/- was sanctioned at two stages; Rs.8,00,000/- at
the first stage and Rs.2,00,000/- at the second stage. The
documents with respect to the sanction of loan and the
disbursal were marked. PW3 deposed that she had not seen
the loan application; which is irrelevant insofar as the Regional
Office having sanctioned it.
Criminal Appeal No. 2460 of 2026 Page 5 of 13
10. Insofar as A4 is concerned, an overdraft limit was
sanctioned to him, again, with due approval of the Regional
Office, as is evident from the documents. The communications
between the Anna Nagar Branch and the Regional Office were
also produced.
11. The specific case of the prosecution was that, though,
the loans were sanctioned in the name of A4 and A5, the
disbursal of amounts by cheques were accepted by A2, which
is evident from his signature on the back of such disbursal of
cheques. However, in the chief examination, PW2 marked a
number of cheques, two of which were identified as having
been received by A4 and another, by one Venkatesan and P73
to P78, received by P. Kumaradevan, the deceased A2.
12. It is not clear as to how A2’s signature was identified and
there was no document produced to indicate his
contemporaneous signature or at least the signature he affixed
at the time he was an officer working in the Indian Overseas
Bank in Chennai itself. More relevant is the fact that PW5 and
PW6 were retired Officers of the Indian Overseas Bank who
were working with A2. There was no attempt to confront the
Criminal Appeal No. 2460 of 2026 Page 6 of 13
said witnesses with the signatures on the back side of the
cheque to identify those as affixed by A2 himself.
13. In fact, PW5 and PW6 were examined to prove that they
had not rented out a house respectively to A5 and A4. PW5
says that the brother of A2 was also working in the bank, who
is also deceased. PW5 speaks of a lease of a building having
been given to the brother of A2 and not to A5. PW6, another
officer of the Indian Overseas Bank, also speaks of no lease
having been made to A4.
14. We are unable to comprehend as to why such evidence
was led and we presume that the addresses in the loan
application given by A4 and A5, were related to such
buildings, to rebut which PW5 and PW6 were proffered.
However, PW2 and PW3, officers of the Indian Bank, one at the
Regional Office and the other at the Anna Nagar Branch itself,
have not spoken of the addresses in the loan application, as
given by A4 and A5. There is also nothing produced as proof
of ownership of the two premises, for PW5 and PW6 to speak
on the lease of the said premises.
Criminal Appeal No. 2460 of 2026 Page 7 of 13
15. Now, we come to the other witnesses who were
examined to prove the prosecution case of the loan to A4 and
A5 having been obtained surreptitiously by A2 himself. PW7
is said to be a person engaged in furniture business, who
speaks of A2, having introduced him to A1, who promised him
a loan, which was never granted; absolutely irrelevant since it
is not the character and conduct of A1 that is to be proved in
trial. PW8 to PW11 speak of land transactions with A2 and deny
having sold any such land to A4 or A5. Though, photocopies of
sale deeds are produced and marked, there is no testimony as
to in whose name, the sale deeds were executed, rather who
the purchaser was. The deeds of properties mortgaged by A4
and A5 were also not produced in the trial.
16. In any event, the testimony of PW8 to PW11 would only
indicate that A2 was indulging in real estate purchases, even
on behalf of others, which does not, in any manner, inculpate
A1. It is also pertinent that large extents of property, insofar as
PW9, 1.22 acres, with respect to PW10, 37 cents and PW11, 54
cents, are said to have changed hands. Definitely, this could
not have been purchased with the loan availed by A4 and A5
Criminal Appeal No. 2460 of 2026 Page 8 of 13
from the Indian Bank, Anna Nagar Branch. PW12 and PW13 are
the Investigating Officers, who also do not speak anything
incriminating to find culpability of A1 in the two loans
sanctioned to A4 and A5. None of the title deeds, or their
certified copies, pertaining to the transactions spoken of by
PW8 to PW11 are produced, but only photocopies were
produced. The title deeds or the certified copies of the
mortgaged properties, we reiterate, were also not produced.
17. PW4 an Assistant Commissioner of the I.T. Department
was examined to disprove the introduction noted in the
Account Opening Form of one of the borrowers, who denied
knowledge of the same. The introduction as noticed in the
Account Opening Form came from the Office of the Managing
Director of Indian Bank, who spoke of the applicant being
known to PW4. The named person from the M.D’s Office was
not examined.
18. Admittedly, the properties were auctioned in 2010. The
Trial Court and the High Court waxed eloquent about the value
being enhanced in the valuation certificate, issued by A3. We
see only one valuation certificate produced by the
Criminal Appeal No. 2460 of 2026 Page 9 of 13
prosecution, as Ext.P22, furnished to the Bank by A4. No
contemporaneous deeds or the market value fixed by the
Government were produced to indicate the actual value of the
properties mortgaged, when the loan was availed. The Trial
Court and the High Court merely presumed on the basis of the
value obtained after 20 years that it would have been far lower,
when the loan was availed. The loan was availed in the year
1991-1992 and the property was auctioned in the year 2010.
Admittedly, the auction of properties were completed and the
entire amounts due to the Bank were received. More
intriguing is the fact, as coming out from the testimony of the
official witnesses, that the amounts received in auction, in
excess of the appropriation to the loan accounts are still
remaining with the bank. We are surprised that no attempt was
made to find out the legal heirs and pass on the money.
19. We are clear in our minds that the prosecution case set
up is fabricated and has no legs to stand. That A1 had
sanctioned loans to A4 and A5, has been proved. It is also
coming out from the testimonies of the official witnesses, PW1
and PW2 that the loans were sanctioned by the Regional Office
Criminal Appeal No. 2460 of 2026 Page 10 of 13
itself. Properties mortgaged were proceeded against and sold
in auction, the proceeds of which satisfied the loan availed and
left much more with the bank. A2 is said to have purchased a
number of properties or acted as a middleman, in the name of
A4 and A5 or by himself, but that does not prove the
prosecution case as against A1, nor can any case lie against
A2, A4 and A5. There is also no incriminating circumstance
brought out as against A3 too. Real estate business is not an
illegal activity and there can be no charge even against A2 on
such specious evidence led at the trial. The mere statements
made by the witnesses as to A2 having purchased the
properties, if contrary to the name of the purchasers revealed
from the deeds, makes such testimony inconsequential and
irrelevant. That, A4 & A5 were domestic helps of A2, that the
loans sanctioned were in fact appropriated by A2, that the
mortgaged properties were overvalued, that A1 sanctioned
the loans illegally are all just figments of imagination. The CBI
has failed miserably in not only proving its case but also in
framing the case.
Criminal Appeal No. 2460 of 2026 Page 11 of 13
20. We find absolutely no reason to sustain the conviction
of the accused and set aside both the orders of the Trial Court
and the High Court. The accused, if in custody, shall be
released forthwith, if not required in any other case and if the
accused is already released on bail, the bail bonds shall stand
cancelled.
21. We make it clear that we have granted a clean acquittal
to A1 from the allegations set up by the prosecution.
22. Before we leave the matter, we are concerned as to how
the Indian Bank kept the excess money in auction received by
them, without disbursal to the legal heirs, even if the
predecessors-in-interest were arrayed as accused in this case.
23. Having found the case to be fully fabricated, we call for
a report from the Branch Manager, Indian Bank, Anna Nagar
Branch, who is impleaded herein as a respondent with regard
to the loan accounts which are the subject matter of this case
booked by the CBI and the satisfaction of the same as also
utilisation of the money received on auction sale of the
mortgaged properties. The title deeds of the properties
mortgaged shall also be produced before us. The Branch
Criminal Appeal No. 2460 of 2026 Page 12 of 13
Manager, Indian Bank, Annanagar Branch shall be issued a
copy of this judgment by the Registry of this Court and
directed to comply with the directions herein.
24. The case, though, disposed of, shall be posted only for
the purpose of ascertaining the status of the excess money
received on auction and to ensure the due disbursal of the
same. We direct the Registry of this Court not to return the
records of the case until further orders.
25. The appeal is allowed.
26. The case shall be posted on 05.10.2026, only for the
purpose of perusing the report and issuing further directions.
27. Pending application(s), if any, shall stand disposed of.
.......…….……………………. J.
(J. B. PARDIWALA)
....……….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI;
SEPTEMBER 01, 2026.
Criminal Appeal No. 2460 of 2026 Page 13 of 13
ITEM NO.1502 COURT NO.6 SECTION II-C
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Criminal Appeal No.2460/2026
V. BALAKRISHNAN Appellant(s)
VERSUS
STATE REP BY THE DEPUTY SUPERINTENDENT OF POLICE Respondent(s)
[ HEARD BY : HON. J.B. PARDIWALA AND HON. K. VINOD CHANDRAN, JJ.
]
IA No. 227641/2025 - PERMISSION TO FILE ADDITIONAL
DOCUMENTS/FACTS/ANNEXURES
Date : 01-09-2026 This matter was called on for pronouncement of
judgment today.
For Appellant(s) : Mr. M.P. Parthiban, AOR
For Respondent(s) :Mr. Davinder Pal Singh, A.S.G.
Mr. Shreekant Neelappa Terdal, AOR
Mr. Khushal Kolwar, Adv.
Mr. Shubham Prakash Mishra, Adv.
Mr. Abhinav Singh, Adv.
Mr. Jagdish Chandra, Adv.
1. HON’BLE MR. JUSTICE K. VINOD CHANDRAN pronounced the
judgment of the Bench comprising HON'BLE MR. JUSTICE J.B.
PARDIWALA and His Lordship.
2. The appeal is allowed in terms of the signed non
reportable judgment.
3. The relevant part of the signed non reportable
judgment is as under:-
“20. We find absolutely no reason to sustain the
conviction of the accused and set aside both the
orders of the Trial Court and the High Court. The
accused, if in custody, shall be released
forthwith, if not required in any other case and if
the accused is already released on bail, the bail
bonds shall stand cancelled.
21. We make it clear that we have granted a clean
acquittal to A1 from the allegations set up by the
prosecution.
22. Before we leave the matter, we are concerned
as to how the Indian Bank kept the excess money in
auction received by them, without disbursal to the
legal heirs, even if the predecessors-in-interest
were arrayed as accused in this case.
23. Having found the case to be fully fabricated,
we call for a report from the Branch Manager, Indian
Bank, Anna Nagar Branch, who is impleaded herein as a
respondent with regard to the loan accounts which are
the subject matter of this case booked by the CBI and
the satisfaction of the same as also utilisation of
the money received on auction sale of the mortgaged
properties. The title deeds of the properties
mortgaged shall also be produced before us. The
Branch Manager, Indian Bank, Annanagar Branch shall
be issued a copy of this judgment by the Registry of
this Court and directed to comply with the directions
herein.
24. The case, though, disposed of, shall be posted
only for the purpose of ascertaining the status of
the excess money received on auction and to ensure
the due disbursal of the same. We direct the Registry
of this Court not to return the records of the case
until further orders.
25. The appeal is allowed.
26. The case shall be posted on 05.10.2026, only
for the purpose of perusing the report and issuing
further directions.”
4. Pending application(s), if any, stands disposed of.
(CHANDRESH) (POOJA SHARMA)
ASTT. REGISTRAR-cum-PS COURT MASTER (NSH)
(Original signed non reportable judgment is placed on the file)