Bank suffering ₹88-crore loss is a “victim” entitled to oppose accused’s bail, Karnataka High Court rules

Standard Chartered Bank approached the Karnataka High Court under Section 482 CrPC/Section 528 BNSS challenging the order dated 27 April 2026 of the I Additional Chief Metropolitan Magistrate, Bengaluru, which rejected the Bank’s applications for impleadment and intervention in the accused’s regular bail proceedings in Criminal Case No. 11116/2026 arising from Crime No. 242/2025.

The prosecution case concerned the alleged siphoning and misuse of approximately ₹88 crores from customer and bank-related accounts by Respondent No. 2, Kishore Nakka.

The Bank claimed that it had suffered financial loss and had also released, or was in the process of releasing, amounts to customers who had suffered losses.

Criminal proceedings had been initiated in Crime Nos. 237/2025 and 242/2025.

The Bank was the de facto complainant in Crime No. 237/2025, while Crime No. 242/2025 was registered on the complaint of customers; in the latter case, bank officials were also arrayed as accused.

After investigation and filing of the charge sheet, the accused sought regular bail.

The Bank sought to participate in the bail proceedings as a “victim” under Section 2(wa) CrPC and to oppose the bail application.

The Magistrate rejected the applications, principally reasoning that allegations had also been made against bank officials and that the Bank therefore could not claim the status of a victim.

Whether Standard Chartered Bank, having allegedly suffered financial loss of approximately ₹88 crores due to the accused’s acts, qualifies as a “victim” under Section 2(wa) CrPC and is entitled to participate in the accused’s bail proceedings?

Whether the fact that allegations were also made against bank officials, or that the Bank had reimbursed or undertaken to reimburse customers, disentitled the Bank from claiming victim status and intervening in the bail proceedings?

Whether the Magistrate’s order rejecting the Bank’s impleadment and intervention applications was legally sustainable?

The Court applied Section 2(wa) CrPC, which defines a “victim” broadly as a person who has suffered loss or injury caused by the act or omission for which the accused has been charged, and the corresponding victim-participation principles under the criminal procedure framework.

In Jagjeet Singh v. Ashish Mishra @ Monu, (2022) 9 SCC 321, the Supreme Court held that a victim has substantive, independent and enforceable participatory rights at every stage of criminal proceedings, including bail, and need not necessarily be the complainant or informant.

In Asian Paints Ltd. v. Ram Babu, (2025) 10 SCC 372, the Supreme Court recognised an expansive concept of “victim” encompassing financial loss and reputational injury and held that a victim need not also be the complainant.

In Celestium Financial v. A. Gnanasekaran, 2025 SCC OnLine SC 1320, the Supreme Court held that “loss” or “injury” includes financial, economic and legal injury and that the statutory definition of victim is broad and inclusive.

The Court also relied on Sunny Chauhan v. State of Haryana, SLP (Crl.) No. 1613/2026, decided on 11 May 2026, which recognised the victim’s right to participate in bail proceedings and directed that victims be informed of their right to participate and engage counsel.

The High Court held that the Bank had suffered a direct and substantial financial injury because the alleged siphoned funds constituted bank money and had been diverted into the accounts of the accused and his family members.

The fact that the Bank had compensated customers did not eliminate the Bank’s own loss or extinguish its right to recover the diverted funds or participate in proceedings against the alleged wrongdoer.

Applying the expansive interpretation of “victim” in Jagjeet Singh, Asian Paints, and Celestium Financial, the Court found that a person or institution suffering financial injury may participate in criminal proceedings, including bail hearings, irrespective of whether it is the original complainant or informant.

The Magistrate’s reasoning that the Bank could not be a victim because allegations had also been made against its officials was rejected.

The High Court treated the Bank as a distinct juridical entity that had itself suffered financial loss; allegations against some employees did not negate the Bank’s independent victim status at the stage of considering participation in bail proceedings.

The Court clarified that the merits of the criminal allegations and the ultimate liability of the accused or bank officials were matters for trial and did not justify excluding the Bank from being heard on bail.

It was therefore entitled to participate in, and place objections before the Magistrate in, the accused’s bail proceedings.

The Criminal Petition was allowed, and the Magistrate’s order dated 27 April 2026 in Criminal Case No. 11116/2026 was quashed.