CRLP/15375/2014 of Kilaru Venkata Rosaiah, Vs The State of Telangana, on 31 December 2014

ORDER:

The petitioner, who is A-4 filed the present application underSection 438 CrPC seeking release in the event of his arrest inconnection with Crime No.257 of 2014 of Central Crime Station P.S.,Hyderabad, registered for the offences punishable under Section 120-B, 420, 406, 347, 365 and 386 IPC.

Originally, a private complaint was filed under Section 200 CrPC,which was referred to police under Section 156(3) CrPC. Theaverments in the complaint are as under :

The informant No.1 was running business under the name andstyle of Yamini Exports at Guntur. His business relates to dealing withChilly and was having an annual turn over in Crores. He was also amember of “The Guntur Chillies Merchants Association”. During thefinancial year 2012-2013 the informant received loss to an extent ofRs.10.00 crores in export business. When the business wasflourishing, the informant obtained loan to an extent of Rs.2.00 croresas O.D. against stock and on equitable mortgage from DhanalakshmiBank Limited, Koratipadu, Guntur Town. As the informant failed torepay the same, the Branch Manager of the said Bank lodged a reportagainst the informant for an offence punishable under Section 420IPC. The said report came to be registered as Crime No.143 of 2012. Similarly Crime No.174 of 2013 came to be registered at the instanceof one Karpurapu Koteswara Rao for committing default in payments ofmoney due to him. M/s. Urvasi Chillies Trading Company rep. by itsProprietor Gollapudi Ramesh Babu also filed three cases against theinformant for the offences punishable under Section 138 of theNegotiable Instruments Act, 1881. During the period of threat andcriminal intimidation from the persons to whom the informants weredue, they came in to contact with accused Nos.1 and 2 and others who are resident of Hyderabad and Miryalaguda. When the informantsconveyed their problems, the accused 1 and 2 are alleged to haveasked them to come down to Secunberabad along with the total cashavailable, gold, silver ornaments, other precious stones and articlesetc. Believing the words of accused No.1, the informant along withtheir families came down to Hyderabad. After reaching Hyderabad,the accused No.1 and his henchmen are alleged to have abducted theinformants and their family members to an unknown place and alsotook away cash and gold from them. The cell phones which were inthe custody of the informant were also taken by them. As thewhereabouts of the informant were not known, the brother-in-law of thesecond respondent lodged a report which came to be registered asCrime No.79 of 2013 for the offences punishable under Section 363read with 34 IPC. While the police were investigating into the crime,the accused in the said crime, who are the petitioners herein, filedCriminal Petition Nos.5461 of 2013 seeking quashing of theinvestigation. It is alleged that the petitioners herein directed theinformants to take steps for closure of the crime failing which theyrefused to refund the cash and gold held by them. On an assurancemade by the accused, the informants are alleged to have signed on thepapers which were filed before this Court in the quash application. They were also directed to appear before the concerned Court andHigh Court for the purpose of recording their statements. Pursuant tothe compromise made by the informants with the accused this Courtquashed the proceedings on 12.03.2014.

In spite of closure of the case, the accused failed to return cashof Rs.1,70,00,000/- and gold items worth Rs.1.00 crore. Whenever theaccused demanded for return of the same, the accused used tothreaten them with dire consequences. It is further stated that theGuntur Chillies Merchant Association Agricultural Market Yard, Guntur,authorized its president K.V.Rosaiah to settle the claim and disputes ofits members. By virtue of the powers conferred, the said person is

alleged to have harassed the informants and also threatened themwith dire consequences. The said K.V.Rosaiah is alleged to haveobtained signatures of the informants and his brother under threat andcoercion. He is alleged to have encouraged the creditors to file falsecriminal cases in various police station in Guntur District. In view ofthe threat to their life, the informant and his brother are alleged to havesigned on various papers under threat and coercion. It is alleged thatthe informants never intended to transfer their movable or immovableproperties in favour of the said persons by virtue of the authorized letterbut the signatures were forcibly obtained for transfer of valuableproperties. It is further stated that informant No.2, who is brother ofinformant No.1 was forcibly involved by the Guntur Chillies MerchantsAssociation Agricultural Market Yard, Guntur, for settlement of accountwith accused No.1 against the properties of the family. The accusedand their henchmen wrongfully confined the informants at NTR Nagar,Saroornagar and forced them to execute special power of attorney infavour of M.Narendar (Accused No.5) for transfer of property situated atGuntur in favour of K.V.Roshaiah (accused No.4). It is alleged that inview of the threat and beating, the informants had no other go except toexecute a special power of attorney vide document dated 20.07.2013in favour of M.Narendar. On the same day, signatures were obtainedfor transfer of the properties in favour of Guntur Chillies MerchantsAssociation Agricultural Market Yard, Guntur, to settle the disputeswith creditors. Till date the said persons have neither settled thedisputes of the creditors nor withdrawn the cases filed against them. On 03.10.2013 when the informant and his brother went toYadagirigutta to offer prayers, accused No.4 and his henchmen arealleged to have followed them from Hyderabad and later kidnappedthem when they came out of the temple after performing poojas. Thekidnappers questioned them about the cash and gold, brought them toGuntur on 08.10.2013 and handed over them to accused No.4, whodetained them in a function hall for a day. On 10.10.2013 theabductors released the informants by threatening them with dire consequences. It is alleged that though the informants never acceptedK.V.Roshaiah as their arbitrator as he was only representative ofGuntur Chillies Merchants Association, he declared himself as anarbitrator, prepared matter on judicial stamps papers and obtainedsignatures of the informants forcibly. Accused No.4 is alleged to havegot executed registered documents in his name through accused No.5,who is also a relative and associate of accused No.1.

The averments in the report ultimately disclose that accusedNo.1 deceived the informants without filing any insolvency petitionbefore the Senior Civil Judge, Ranga Reddy against their creditorsand deceived the informants without refunding the amount though areceipt dated 25.02.2013 acknowledging receipt of Rs.1,35,00,000/-was issued. It is thus alleged that all the accused conspired togetherand cheated the informants to a tune of Rs.1,70,00,000/- cash and goldornaments worth Rs.1,00,00,000/- and it is also alleged that the abovesaid persons played fraud in getting the case closed through CriminalPetition No.5461 of 2013. Basing on these allegations the above casecame to be registered.

The learned counsel for the petitioner mainly submits that evenaccepting the allegations in the report to be true no offence is made outagainst the petitioner. According to him, number of cases areregistered against the informant in Guntur District as they fell duesubstantial amount to the farmers. He further submits that theinformants themselves appeared before the High Court and statedabout the settlement of all disputes and also expressed their noobjection for quashing the proceedings. He also placed reliance onthe affidavits filed before the Human Rights Commission, narrating themanner in which the incidents took place and also about filing theInsolvency Petition. According to him, the allegations in the report thatproperties are transferred in his name under a threat and coercion areall false and invented for the purpose of this case. He submits that hebeing the President, Guntur Chilly Merchants Association, was authorized to settle the claim made by the claimants and as per thesaid authorization he sold some of the properties to settle the claimand deposited substantial amounts in the account. He also submitsthat the allegations made in the report that A-1 to A-3 wrongfullyconfined the informant at Saroornagar and forced him to execute thespecial power of attorney in favour of one M.Narendra so as to transferthe properties in favour of the petitioner, are all false. He also deniesthe abduction, which is alleged to have taken place at Yadagirigutta inthe presence of the wife of the informant.

Per contra, the learned Public Prosecutor strenuously opposesthe application contending that the petitioner was benefited by the saidtransaction as he played a crucial role in disposing of the properties. He relied upon the letter dated 15.11.2014 issued by the Manager,Dhanalakshmi Bank Ltd., Eluru Bazar, Guntur, to the Inspector ofPolice, Central Zone Team, CCS, Detective Department, HyderabadCity, to show that the involvement of the petitioner in the crime.

It is not in dispute that the petitioner is the President of GunturChillies Market Association. It is also not in dispute that the defactocomplainant in course of their business transaction incurred debts tochilly traders in Guntur and failed to repay the amount due to the Bankand also to the other lenders. The fact that crimes were registeredagainst the informant at Guntur is also not in dispute. In fact theDhanalakshmi Bank, Guntur also initiated prosecution vide CrimeNo.143 of 2012 against the informants. Similarly Crime No.174 of2013 also came to be lodged at the instance of one Koteswara Rao forcommitting default in payments of money due to them. M/s. UrvasiChilly Trading Company, represented by its Proprietor G.Rambabualso lodged three cases against the informant for the offencespunishable under Section 138 of the Negotiable Instruments Act. Asthe whereabouts of the informant were not known, the brother-in-law ofthe informant lodged a report, which came to be registered as CrimeNo.79 of 2013 for the offences punishable under Section 363 read with

34 IPC. During the course of investigation of the said crime, theinformants compromised with the alleged abductors and in Crl.P.No.5461 of 2013 filed before the High Court seeking quashing of theinvestigation was closed on the ground of compromise. Theinformants filed affidavit seeking permission of the Court forcompounding the offence and also appeared before the Court, whereinthey stated that they have settled the matter with the accused and haveno objection for quashing the proceedings. The said order came to bepassed on 12.03.2014. Thereafter, a private complaint came to befiled when the accused in the said crime went back on their promise.The said private complaint which was filed in the month of September2014 was referred to police and the same came to be registered asCrime No.257 of 2014 on 10.10.2014 making allegations against 8accused. The material on record also discloses filing of affidavitsdated 04.06.2013 before the Human Rights Commission, wherein theinformants failed to mention about their abduction.

A perusal of the letter dated 15.11.2014, issued byDhanalakshmi Bank which has been placed on record by the learnedPublic Prosecutor, would show that the Bank has auctioned all theproperties which were pledged with them. The said letter disclosesthat an advertisement was published in two news papers on30.08.2013 and the sale notice was fixed on 30.09.2013. As there wasno participants on the said date, another notice was issued for sale bypublication under SARFAESI Act on 22.10.2013, which was againpublished in news papers and was also served on the borrowers. Even on 29.10.2013 the sale could not be conducted due to want ofborrowers and the auction as adjourned to November 2013. On05.11.2013 sale was conducted for all the properties, but there werebidders only to the extent of 213.8 sq. yards site with Daba House inPlot No.201 at D.No.123 and 124 of Nallapadu and Plot No.202 of 350sq. yards site and the highest bidders was M/s.S.M. Constructions. The letter also discloses that in the said auction two properties were sold. While things stood thus, on 21.09.2013 and 15.10.2013, theGuntur Chillies Merchant Association has approached theDhanalakshmi Bank and stated that they have taken possession of thestock of the chilly bags under hypothecation to the bank and sold thesaid chilly stock. It is also mentioned that a sum of Rs.24,00,000/- wasremitted into the account of M/s. Yamini Exports. A letter of saleproceedings and copy of the receipt of amount deposited, wasfurnished to the Bank. Relying upon this, the learned PublicProsecutor strenuously contended that the petitioner herein wasbenefited by sale and he has no right or authority to auction the saidchillies which are hypothecated to Bank.

The learned Public Prosecutor contends that the petitioner alongwith Bank officials colluded with each other and sold property worthRs.7 crores for Rs.2 crores only, so as to intentionally cause loss to theinformant. He places on record the rates which were prevailing themand the rate for which the stock was sold. It appears that stock wassold for a price which was less than the market value. It is also to benoted that the petitioner has no authority to sell the stock which wasmortgaged to the Bank.

Further, the wrongful confinement of the informant in a functionhall in Guntur and the torture meted out to him was alleged to havebeen videographed and stored in C.D. The learned Public Prosecutorsubmits that if the C.D. is seen, the real facts would come out and itwould demonstrate the true version of the case.

Insofar as the M.O.U. is concerned, a perusal of the same doesnot show the place where it was executed and also the date. Furtherthe signature of the notary and the seal was affixed on the signature ofthe executant. From this, the argument of the learned PublicProsecutor that blank signed papers were used, cannot be ruled out atthis stage. A perusal of the G.P.A. shows that though the photographsof the informant was affixed on the document but the same was signed

by accused No.5 in the office of Sub-Registrar. It appears to that theM.O.U. which was alleged to have been executed and producedbefore this Court does not seen to have been executed under normalcircumstances. From the above, a doubt arises as to thecircumstances under which the affidavit filed before this Court in quashpetition and also before the H.R.C. was executed. It is true that bankhas sold the properties in an auction by following the procedure. Butthe learned Public Prosecutor submits that the said auction was incollusion with the Bank Officials which caused loss to the informants. According to him, the police are investigating into the matter. As statedearlier, the letter issued by Dhanalakshmi Bank, clearly discloses thatchillies which were mortgaged to the Bank were sold by the ChilliesMerchants Association at Guntur, without the knowledge of the bank. That being the position, it can only be said that true facts still have tocome to light and the argument of the learned Public Prosecutor statesthat they would come to light only if the petitioner is arrested cannot bebrushed aside.

Having regard to the magnitude of the amount involved, thetwist and turn in the case, transfer and sale of properties at low price,sale of chillies at a very low cost and the video recording showing thealleged torture of the informant, I am of the opinion that it is not a fitcase to grant anticipatory bail to the petitioner. However, thepetitioner, if so advised, shall surrender before the concerned courtand move an application for regular bail, by giving prior notice to thelearned Public Prosecutor concerned, which shall be dealt with inaccordance with law either on the same day or atleast by next day.

With the above direction, the criminal petition is disposed of.

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C. PRAVEEN KUMAR, J