Supreme Court Quashes Summons Against Bank Clerk in Embezzlement Case: Meenu Prakash Bhantu vs. State of Uttar Pradesh (2023) INSC 244 (16 March 2023)

Date of the Judgment: 16 March 2023
Citation: (2023) INSC 244
Judges: Abhay S. Oka, J., Rajesh Bindal, J.
Can a bank employee be summoned as an accused in a case of fraudulent withdrawal simply for providing a misprinted statement of account? The Supreme Court of India recently addressed this question, clarifying the parameters for summoning additional accused under Section 319 of the Code of Criminal Procedure, 1973 (CrPC). The Court quashed the summons issued against a bank clerk, emphasizing that there must be strong evidence to suggest complicity in the crime, not just a mere possibility. The judgment was authored by Justice Rajesh Bindal.

Case Background

The case originated from a First Information Report (FIR) lodged on 20th June 2014, by Respondent No. 2, alleging that ₹55,20,000 was embezzled from his bank account. The complainant stated that unauthorized withdrawals occurred, a new cheque book was issued without his request and was collected by an unauthorized person. The complainant also mentioned that SMS alerts for bank transactions suddenly stopped. He discovered the fraud on 19th June 2014, when he got entries done in his passbook. Initially, the FIR did not name any accused but, after investigation, a charge sheet was filed against two bank employees. During the trial, the complainant reiterated his allegations and admitted that the bank had returned the embezzled amount.

Timeline

Course of Proceedings

The prosecution filed an application under Section 319 of the CrPC to summon the present appellant, along with other bank officials and the then Post Master, as additional accused, based on the complainant’s statement. The Additional Chief Judicial Magistrate rejected this application on 6th May 2017, stating that there was insufficient material to summon the accused. The Sessions Judge allowed the revision petition against this order on 4th July 2017, and remitted the matter back to the Trial Court for fresh consideration. Subsequently, on 29th August 2017, the Additional Chief Judicial Magistrate allowed the application and directed the summoning of the appellant and others. Aggrieved by this order, the appellant approached the High Court at Allahabad, which dismissed the application under Section 482 of CrPC on 12th October 2017, with general observations. This order was challenged before the Supreme Court.

Legal Framework

The Supreme Court referred to Section 319 of the Code of Criminal Procedure, 1973 (CrPC), which deals with the power of the court to proceed against other persons appearing to be guilty of an offense. The relevant part of Section 319 CrPC is as follows:

“Where, in the course of any inquiry into, or trial of, an offence, it appears from the evidence that any person not being the accused has committed any offence for which such person could be tried together with the accused, the Court may proceed against such person for the offence which he appears to have committed.”

The Court emphasized that the power under Section 319 CrPC is discretionary and extraordinary, to be exercised sparingly. It should not be used merely because the court thinks someone else might be guilty, but only when there is strong and cogent evidence suggesting the person’s involvement in the crime.

Arguments

Appellant’s Arguments:

• The appellant was merely a Miscellaneous Clerk at the State Bank of India and cannot be held responsible for fraudulent withdrawals.
• The only allegation against the appellant was that he supplied a statement of account that was either illegible or misprinted.
• The High Court failed to appreciate the facts and passed a general order without discussing the specifics of the case.
• The order passed by the Additional Chief Judicial Magistrate was non-speaking and merely referred to the Sessions Judge’s order.
• The appellant relied on the Constitution Bench judgment in Hardeep Singh and Ors. Vs. State of Punjab & Ors., (2014) 3 SCC 92, to argue that the power under Section 319 CrPC should be exercised sparingly and only when there is strong evidence.

Respondents’ Arguments:

• There was a fraudulent withdrawal of ₹55,20,000 from the complainant’s account.
• The appellant’s role was clearly established as he supplied a misprinted or illegible statement of account.
• The complainant was not given a satisfactory reply when he inquired about the new cheque book.
• The appellant, being responsible for providing account statements, is equally responsible for the fraud.

Innovativeness of the argument: The appellant’s argument was innovative in highlighting that a mere clerical error or a misprint in a statement of account is not sufficient to establish complicity in a large-scale fraud. This argument challenged the assumption that every bank employee involved in a transaction is automatically a suspect.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the core issue before the Court was:

1. Whether the High Court was correct in dismissing the application under Section 482 CrPC, thereby upholding the summoning of the appellant as an additional accused under Section 319 CrPC.

Treatment of the Issue by the Court

Authorities

The Supreme Court relied on the following authorities:

• Hardeep Singh and Ors. Vs. State of Punjab & Ors., (2014) 3 SCC 92: This Constitution Bench judgment laid down the parameters for exercising power under Section 319 CrPC. The Court reiterated that this power is discretionary and extraordinary, to be exercised sparingly, and only when there is strong and cogent evidence against a person.
• Sagar vs. State of U.P. & Anr., (2022) 6 SCC 389: This case reiterated the principles laid down in Hardeep Singh, emphasizing that the evidence required for summoning an additional accused should be more than a prima facie case.

The Court also considered the following legal provision:

• Section 319 of the Code of Criminal Procedure, 1973 (CrPC): This section empowers the court to proceed against any person who appears to have committed an offense during the course of any inquiry or trial.

Judgment

How each authority was viewed by the Court?

• The Supreme Court relied on Hardeep Singh and Ors. Vs. State of Punjab & Ors., (2014) 3 SCC 92* to reiterate that the power under Section 319 CrPC is a discretionary and extraordinary power, to be exercised sparingly and only when there is strong and cogent evidence against a person.
• The Supreme Court also relied on Sagar vs. State of U.P. & Anr., (2022) 6 SCC 389* to emphasize that the evidence required for summoning an additional accused should be more than a prima facie case.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the lack of concrete evidence linking the appellant to the fraudulent withdrawals. The Court emphasized that the power under Section 319 CrPC should not be exercised lightly and requires more than a mere suspicion. The fact that the appellant was a clerk and the only allegation against him was providing a misprinted statement was not considered sufficient to establish his complicity in the crime.

The Court’s reasoning was more focused on the legal principles and the proper application of Section 319 CrPC rather than the specific facts of the case. The emphasis was on ensuring that the power to summon additional accused is not misused.

The Court considered alternative interpretations of the evidence but rejected them, stating that the evidence was not strong enough to suggest the appellant’s complicity in the fraud. The Court emphasized that the power under Section 319 CrPC is to be exercised sparingly and only when there is strong and cogent evidence against a person.

The Supreme Court held that the High Court erred in dismissing the application under Section 482 CrPC. The Court stated that the parameters for summoning additional accused under Section 319 CrPC, as laid down in Hardeep Singh and Ors. Vs. State of Punjab & Ors. (2014) 3 SCC 92, were not met. The Court found no strong and cogent evidence to suggest the appellant’s complicity in the fraud. The Court stated:

“In the aforesaid order, no reasons were assigned except stating that for the reasons stating by the Sessions Judge in his order by which the matter was remitted back for consideration afresh, the application is allowed and the present appellant, Accountant S.D.Sharma, Bank Manager M.L.Verma and the then Post Master of Gonda Post Office were directed to be summoned.”

“Based on this material, opinion cannot be formed that he was in connivance with the accused who allegedly indulged in cheating the complainant by fraudulent withdrawal from his account. He is not authorized either to approve withdrawal or to deal with the account of the complainant.”

“For the reasons stated aforesaid, the present appeal is allowed. The impugned order dated 12th October, 2017 passed by the High Court is set aside and the application filed by the prosecution for summoning the present appellant as an additional accused is dismissed.”

There were no dissenting or concurring opinions in this case.

The implications for future cases are that the courts must exercise caution while summoning additional accused under Section 319 CrPC and must have strong evidence to suggest complicity in the crime. The court’s decision reinforces the principle that mere suspicion or a clerical error is not sufficient grounds for summoning an individual as an accused.

Key Takeaways

• The power under Section 319 CrPC is discretionary and extraordinary, to be exercised sparingly.
• Strong and cogent evidence is required to summon an additional accused, not just a prima facie case.
• A mere clerical error or misprint in a document is not sufficient to establish complicity in a crime.
• Courts must apply judicial mind and discuss facts when deciding on summoning additional accused.

Directions

The Supreme Court set aside the High Court’s order and dismissed the application for summoning the appellant as an additional accused.

Development of Law

The ratio decidendi of this case is that the power under Section 319 CrPC should be exercised judiciously, based on strong and cogent evidence, and not on mere suspicion or a clerical error. This judgment reinforces the existing legal position as established in Hardeep Singh and Sagar, and does not introduce any new legal principle. It clarifies the application of the existing law to the specific facts of this case.

Conclusion

The Supreme Court’s decision in Meenu Prakash Bhantu vs. State of Uttar Pradesh clarifies the parameters for summoning additional accused under Section 319 of the CrPC. The Court emphasized that there must be strong and cogent evidence to suggest complicity in a crime, not just a mere possibility. The Court quashed the summons issued against the bank clerk, reinforcing the principle that mere suspicion or a clerical error is not sufficient grounds for summoning an individual as an accused. This judgment serves as a reminder that the power under Section 319 CrPC must be exercised judiciously and with due regard to the evidence presented.