Sanchayita Lahkar

The High Court of Karnataka Single Bench of Justice Mohammad Nawaz has dismissed a petition filed under Section 482 of the Criminal Procedure Code seeking to quash criminal proceedings initiated in connection with an alleged misappropriation of over Rs.3.35 crores involving IDBI Bank accounts. The Court found that the investigative materials collected during the inquiry established a prima facie case against the petitioner and that further investigation under Section 173(8) Cr.P.C. was ongoing.

The Court refused to entertain the petitioner’s argument that the absence of his name in the First Information Report (FIR) nullified the proceedings against him. It noted that subsequent evidence indicated his role in the transactions, including direct receipt of fraudulently transferred amounts. The Bench concluded that the continuation of criminal proceedings did not amount to an abuse of process, and hence, declined to quash the FIR or the charge sheet filed under various provisions of the Indian Penal Code, Information Technology Act, and Prevention of Corruption Act. The petition was accordingly dismissed.

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A complaint was filed by the Assistant General Manager and Branch Head of IDBI Bank, Gandhinagar Branch, Bengaluru, alleging misappropriation of funds by Smt. Sajila Gurumurthy, then Manager at the bank. The FIR, initially registered under Sections 409 and 420 IPC, was later transferred to the Lokayukta Police. Further investigations revealed involvement of additional individuals, leading to an expanded charge sheet including Sections 403, 406, 408, 409, 419, 420, 465, 468, 471, and 120B read with Section 34 of IPC, Section 66 of the Information Technology Act, and Section 13(1)(2) of the Prevention of Corruption Act, 1988.

It was alleged that Sajila Gurumurthy, along with co-accused Deepti Koppolu and Pallavi D.R., facilitated fraudulent fund transfers from multiple customer accounts without proper authorization between March and December 2022. Investigations identified manipulation of mobile numbers and email IDs to prevent customers from receiving transaction alerts. Allegedly, fixed deposits were prematurely closed and proceeds were fraudulently diverted. These actions were claimed to be done in connivance with the petitioner, Puneeth H.R., who was later arraigned as accused No.4.

According to the charge sheet, the petitioner received funds totalling Rs.3.80 crores into his various bank accounts via RTGS/NEFT. The funds were allegedly derived from fraudulently debited customer accounts. During investigation, original sale deeds and a BMW car were seized, reportedly purchased using the said funds. The petitioner’s role, according to the prosecution, included soliciting illegal gratification in exchange for bypassing standard banking procedures to facilitate a purported land purchase.

The petitioner claimed he was a mere account holder and not a bank employee. His counsel submitted that he had no control over bank transactions and was falsely implicated without evidence. He challenged the charge sheet and its inclusion of his name when the FIR made no mention of him.

The Court recorded in "It is not in dispute that the FIR was registered against one Smt. Sajila Gurumurthy... It is clearly stated in the complaint that further details would be furnished, when the internal audit or investigation are concluded."

Regarding subsequent developments, the Court noted: "In the subsequent information/complaint dated 07.02.2023, it is clearly stated that during enquiry it was revealed that amount was fraudulently credited to the beneficiary and around Rs.3.37 Crores was transferred through RTGS/NEFT to the various bank accounts of the petitioner."

Justice Nawaz examined the investigation's findings and stated: "The investigation revealed that accused No.1 in active collusion with accused Nos.2 and 3 and in connivance with the petitioner/accused No.4, transferred a total sum of Rs.3,35,13,122.37/-..."

The Court stated that: "Petitioner has utilized the proceeds of the crime to purchase immovable properties and a BMW car... The original sale deeds and documents have been seized under a panchnama."

Addressing the argument that the petitioner’s name was not originally mentioned, the Court observed: "Mere absence of an accused person's name in the initial complaint does not, by itself, absolve them of criminal liability... An accused whose involvement surfaces during the course of investigation may subsequently be added to the charge sheet."

The bench referred to several Supreme Court precedents to support its findings, including Pratap Singh and Suvarna Cooperative Bank, noting: "Criminal proceedings involved in economic offences, having serious implications on the society should not be quashed at the threshold."

"Having perused the material on record, it cannot be said that there is no prima facie case against the petitioner or the ingredients of the offence alleged against the petitioner are not made out." Thus, the petition failed to meet the threshold for quashing proceedings under Section 482 Cr.P.C.

The High Court concluded that: "At this stage it cannot be said that there is no prima-facie case against the petitioner or the ingredients of the offences alleged are not made out. It is not in dispute that the further investigation is pending."

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Justice Nawaz rejected the petitioner’s plea for selective application of charges, noting: "Not arraigning some of the other persons named by the complainant as accused in the charge sheet is not a ground to quash the proceedings against the petitioner."

In addressing procedural fairness, the Court stated: "The learned High Court Government Pleader has contended that the further investigation is pending to verify the involvement of other persons in the fraudulent transactions."

"Petition is dismissed. Observations made in this order are confined to the disposal of the petition."

Advocates Representing the Parties:

For the Petitioner: Pavana Chandra Shetty H., Advocate

For the Respondents: Rashmi Patel, High Court Government, Ashok Haranahalli, Senior Counsel for Vinithra Srinivasan, Advocate and Varun Srinivasan, Advocate

 
Case Title: Puneeth H.R. vs. State of Karnataka and Another

Neutral Citation: 2025: KHC:18388

Case Number: CRL.P No.3429 of 2023

Bench: Justice Mohammad Nawaz

[Read/Download order]