Telangana HC Quashes Forgery Case For Fabricating Loan Documents Upon Noting That Although Prima Facie Case Was Established, Loan Amount Had Already Been Repaid

The Telangana High Court has quashed a criminal case against M/s Achyutha Electrical and Industrial Private Ltd on account of the loan availed by it based on fabricated documents from Andhra Bank, holding that although the loan was sanctioned based on fabricated documents, the amount was repaid before the issuance of any proceedings or notice.

“No doubt, fabricated documents were produced for availing loan from Andhra Bank. However, even prior to issuance of any notice or any kind of proceedings either civil or criminal being initiated by the Bank, the amount was repaid. The Bank has ratified the transaction done by the 2nd petitioner and accepted the amounts without any objection. Further, the Bank has not lodged any complaint or proceeded against the 2nd petitioner.” Justice K Surender held.

The order was passed in a plea filed by Achyutha Electricals to quash the criminal case initiated against it and its Managing Director in 2018 on account of a crime registered against them in 2018 for the offenses of forgery punishable under sections 468 and 471 of IPC.

The prosecution submitted that the petitioners, in 2012, produced a fake letter of credit along with a fake confirmation and acceptance letter for a tune of Rupees 1,03,00,185/- alleged to have been issued by the Standard Chartered Bank, before the Andhra Bank in Hyderabad for sanctioning of the loan.

It was argued that when an investigation was launched, it was informed by Standard Chartered Bank that no letter of credit or acceptance letter had been issued by it in favor of the petitioners.

The petitioners on the other hand contended that the loan amount was sanctioned in February 2012, it was also cleared within 5 months in July 2012 and when the amount had already been returned, the proceedings were unwarranted and deserved to be quashed.

Justice Surender held that though a prima facia case of cheating had been made against the accused (since the fabricated documents were not in dispute) since the loan amount was cleared, the intervention of the Court was proper.

The Court also stressed that all loan amounts had been cleared before any proceeding or notice was issued by any authority to the petitioners.

Accordingly, the criminal petition was allowed.

CrlP 81 of 2019

Counsel for petitioner: T.S. Anand

Counsel for respondent: Public Prosecutor.

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