Madras High Court acquits 90-year-old former Bank of Baroda manager in 1990s corruption case

The Madras High Court has acquitted a 90-year-old former Bank of Baroda Chief Manager in a corruption case registered by the Central Bureau of Investigation (CBI) nearly three decades ago, holding that the prosecution had failed to prove its case beyond reasonable doubt [VR Narayanan Vs DSP]..Justice M Nirmal Kumar set aside the conviction of VR Narayanan, who had earlier been sentenced by a Chennai CBI court in 2015 to one year of simple imprisonment and a fine of ₹5,000 under the Prevention of Corruption Act..The case arose from credit facilities sanctioned to M/s Corium Crafts Private Limited between 1991 and 1994. The company had availed packing credit and foreign bills purchase facilities from Bank of Baroda’s Industrial Finance Branch, Chennai. The prosecution alleged that the company and its directors had siphoned off funds by showing fictitious stock of tobacco and leather and that Narayanan, then the bank's Chief Manager, had submitted a false inspection report after visiting godowns in Gujarat..The CBI claimed that though large quantities of tobacco were shown as stored in godowns around Anand and Baroda, a later inspection found that no such stocks were available. It was alleged that some addresses were fake and that in one instance, the supposed godown was a potato field.Narayanan argued that the loan had been sanctioned before he took charge of the branch in November 1991. He said the credit facilities were approved and monitored by the Zonal Office, while the branch only processed and disbursed amounts as per procedure..The trial court convicted Narayanan mainly on the finding that his inspection report had falsely certified the existence of stocks at the Gujarat godowns. Narayanan challenged this verdict before the High Court in 2015..The High Court noted that the application for the loan facility was made on April 15, 1991 and sanctioned on July 6, 1991, before Narayanan joined the branch. It also noted that the previous Chief Manager, who had recommended the loan proposal, was neither made an accused nor examined as a witness.The High Court found that bank officials had confirmed that the loan was processed through the Zonal Office and that the branch acted on instructions from superior authorities. It also noted that Narayanan had earlier refused to release certain amounts and acted only after instructions from the Zonal Office.The Court said the prosecution's case rested mainly on the difference between Narayanan’s inspection report of February 1993 and another inspection report submitted 22 months later in December 1994.“Merely based on discrepancy in the inspection report given by the appellant and the inspection report given by PW6 after 22 months cannot be a sole basis for conviction,” the Court held..It further noted that the investigating officer had admitted that Narayanan had not gained any benefit from the transaction. The loan amount had also been repaid.Allowing the appeal, the Court held that Narayanan’s conviction was not sustainable and acquitted him of all charges..Narayanan was represented by Advocate R Amizhdhu.Special Public Prosecutor R Mohan appeared for the CBI..[Read Judgment]