Karnataka HC Discharges Bank Manager In Alleged Property-Loan Cheating Case, Citing Advocate’s Title Opinion And No Allegation He Created Documents

The petitioner, a bank manager and accused No. 5, was alleged to have assisted other accused in obtaining a loan against the complainant’s property.

He sought discharge, contending that he sanctioned the loan after obtaining a legal opinion confirming the borrower’s title and was unaware of any alleged impersonation or conspiracy.

The Magistrate rejected the discharge application under Section 239 CrPC, and the Revisional Court affirmed that decision.

The petitioner challenged both orders under Section 482 CrPC.

The Court considered Section 482 CrPC, which empowers the High Court to intervene to prevent abuse of the process of court or miscarriage of justice, and Section 239 CrPC, under which discharge may be allowed where the case against the accused does not warrant proceeding to trial.

It also considered Sections 415 and 420 IPC, observing that the offences require the relevant ingredients of cheating.

The judgment cites no precedent.

The Court noted that the petitioner’s case was that he relied on a legal opinion and title-related documents before sanctioning the loan, and that the prosecution did not allege he created the documents or participated in the alleged impersonation.

Although witnesses stated that accused Nos. 5 and 6 assisted the other accused in securing the loan, the Court considered that the petitioner had acted on the legal adviser’s opinion and held that this, without more, did not establish that he was in concert with the other accused or satisfy the ingredients of cheating under Sections 415 and 420 IPC.

It concluded that the lower courts had failed to give due consideration to these circumstances and that continuing the proceedings against the petitioner would amount to an abuse of process.

It set aside the Magistrate’s order rejecting discharge and the Revisional Court’s order affirming it, and allowed the petitioner’s application for discharge under Section 239 CrPC.