SUSHIL SURIversusC.B.I & ANR.

                                                                             "'-

••                         [2011) 8 S.C.R. 1


                             SUSHIL SURI                               A
                                    v.
                             C.8.1. & ANR.
                  (Criminal Appeal No. 1109 of 2011)
                              MAY 6, 2011
                                                                        B
                  [D.K. JAIN AND H.L. DATIU, JJ.]

          Code of Criminal Procedure, 1973:

           s.482 - Inherent powers of the High Court- Scope and c
      ambit of - Held: Section 482 of Cr.P.C. envisages three
      circumstances under which the inherent jurisdiction may be
      exercised by the High Court, namely: (i) to give effect to an
      order under the Cr. P. C.; (ii) to prevent an abuse of the process
      of Court; and (iii) to otherwise secure the ends of justice -
                                                                         D
     Although the power possessed by the High Court under the
     said provision is very wide but it is not unbridled - It has to
     be exercised sparingly, carefully and cautiously, ex debito
     justitiae to do real and substantial justice for which alone the
      Court exists - The inherent powers should not be exercised
      to stifle a legitimate prosecution - The High Court should E
     normally refrain from giving a prima facie decision in a case
      where all the facts are incomplete and hazy, more so, when
      the evidence has not been collected and produced before the
      Court and the issues involved, whether factual or legal, are
      of such magnitude that they cannot be seen in their true F
      perspective without sufficient material.

          s. 482 - Criminal proceedings for forgery/fabrication of
     documents with the intention of defrauding the bank as well
     as the exchequer - Charge-sheet against appellant and other G
     directors of a company for offences punishable under ss.
     1208, 420, 409, 468 and 471 of /PC - Allegation that they
     forged documents/vouchers to show purchase of machinery,
     a pre-condition for release of instalments of loan, and thus not
                                    1                                   H
    2         SUPREME COURT REPORTS                [2011) 8 S.C.R.
                                                                        •
A only duped the bank (PSB) but also defrauded the revenue
  by claiming depreciation on non-existent machinery and in
  the process cheated the public exchequer - Chief
  Metropolitan Magistrate took cognizance of the offences and
  summoned the appellant to stand trial - Appellant filed
B petition under s. 482 CrPC - High Court declined to quash the
  chargesheet - Justification of - Held: Justified - On a
  conspectus of the factual scenario, prima facie, the
  chargesheet does disclose commission of offences by the
  appellant under ss. 1208, 420, 409, 468 and 471 of /PC -
c More than sufficient circumstances exist suggesting the
  hatching of criminal conspiracy and forgery of several
  documents leading to commission of the aforementioned
  offences - Having regard to the modus operandi adopted by
  the accused, as projected in the chargesheet, it is clear that
0 it is not a fit case for exercise of jurisdiction by the High Court
  under s.482 Cr.P.C. as also by this Court under Article 142
  of the Constitution - The accused had not only duped PSB,
  they had also availed of depreciation on the machinery, which
  was never purchased and used by them, causing loss to the
E exchequer, a serious economic offence against the society
  - Merely because the dues of the bank have been paid up,
  the accused-appellant cannot be exonerated from the criminal
  liability - Therefore, the chargesheet against him cannot be
  quashed - Trial Court directed to proceed with the case -
  Penal Code, 1860 - ss. 1208, 420, 409, 468 and 471.
F
        Penal Code, 1860 - ss. 120A and 1208 - Offence of
  "criminal conspiracy" - Essential ingredients of, discussed.

      Penal Code, 1860 - s. 463 - Forgery - Definition of -
G Held: Is very wide - Basic elements of forgery stated.

        Precedent - Ratio decidendi -:- Held: While applying
  ratio, the Court may not pick out a word or sentence from the
  judgment divorced from the context in which the said question
   arose for consideration - Even one additional or different fact
H may make a world of difference between the conclusions in
•               SUSHIL SURI v. C.B.I. & ANR.                 3

    two cases and blindly placing re!iance on a decision is never A
    proper.

         The Company in question and its directors, including
    the appellant, and other persons allegedly had conspired
    to forge, fabricate and use documents in order to avail B
    loan from the Punjab and Sind Bank (PSB) and had
    opened or caused to be opened fictitious bank accounts
    in the names of machinery suppliers to encash the pay
    orders/demand drafts issued by PSB and played fraud
    with PSB as also on the public exchequer by claiming
    depreciation on the machinery, which was never C
    purchased, ·and obtained pecuniary advantage for
    themselves.
         Chargesheet was accordingly filed by the CBI in the
    Court of Chief Metropolitan Magistrate for offences D
    punishable under Sections 1208, 420, 409, 468 and 471
    of IPC. The. Chief Metropolitan Magistrate took
    cognizance of the offences and summoned the accused
    to stand trial. On being so summoned, the appellant filed
    petition under Section 482 of Cr.P.C., praying for E
    quashing of the Chargesheet mainly on the ground that
    once the Company had repaid the loan to PSB along with
    interest, no loss was caused to PSB and, therefore, they
    had not committed any offence for which Chargesheet
    had been filed. The High Court declined to quash the F
    Chargesheet filed against the appellant and other
    directors of the Company holding that merely because
    the Company and its directors had repaid the loan to PSB
    they could not be exonerated of the offences committed
    by forging/fabricating the documents with the intention
    of defrauding the bank as well as the exchequer. G
    Accordingly, the petition filed by the appellant was
    dismissed and he was directed to appear before the trial
    court.

        The question which therefore arose for consideration     H
    4       SUPREME COURT REPORTS            [2011] 8 S.C.R.
                                                                 •
A   in the instant appeal was whether bearing in mind the
    object, scope and width of power of the High Court under
    Section 482 of the Cr.P.C., on the facts in hand, the High
    Court was correct in law in declining to exercise its
    jurisdiction under the said Section.
B
        Dismissing the appeal, the Court

       HELD:1.1. Section 482 of the Cr.P.C. itself envisages
  three circumstances under which the inherent
  jurisdiction may be exercised by the High Court, namely:
C (i) to give effect to an order under the Cr.P.C.; (ii) to
  prevent an abuse of the process of Court; and (iii) to
  otherwise secure the ends of justice. It is trite that
  although the power possessed by the High Court under
  the said provision is very wide but it is not unbridled. It
D has to be e.xercised sparingly, carefully and cautiously,
  ex debito justitiae to do real and substantial justice for
  which alone the Court exists. Nevertheless, it is neither
  feasible nor desirable to lay down any inflexible rule
  which would govern the exercise of inherent jurisdiction
E of the Court. Though exercise of inherent powers would
  depend on the facts and circumstances of each case, but,
  the Court would be justified in invoking its inherent
  jurisdiction where the allegations made in the Complaint
  or Chargesheet, as the case may be, taken at their face
F value and accepted in their entirety do not constitute the
  offence alleged. [Para 11] [16-0-G]
         1.2. The exercise of inherent powers would entirely
    depend on the facts and circumstances of each case. The
    inherent powers should not be exercised to stifle a
G legitimate prosecution. The High Court should normally
    refrain from giving a prima facie decision in a case where
    all the facts are incomplete and hazy, more so, when the
    evidence has not been collected and produced before the
    Court and the issues involved, whether factual or legal,
H · are of such magnitude that they cannot be seen in their
••                 SUSHIL SURI v. C.B.I. & ANR.                   5

     true perspective without sufficient material. [Para 14] [18-      A
     A·D]
         R.P. Kapur v. State of Punjab AIR 1960 SC 866: 1960
     SCR 388; Dinesh Dutt Joshi v. State of Rajasthan and Anr.
     (2001) 8 SCC 570: 2001 (3) Suppl. SCR 465; Central                B
     Bureau of Investigation v. A. Ravisharikar Prasad and Ors.
     (2009) 6 sec 351 - relied on.

          State of Haryana and Ors. v. Bhajan Lal and Ors. 1992
     Supp (1) SCC 335: 1991 (1) Suppl. SCR 387; Janata Dal
     v. H.S. Chowdhary and Ors. (1992) 4 SCC 305: 1992 (1) C
     Suppl. SCR 226 - referred to.

            2.1. In the instant case, in light of the allegations in
       the Chargesheet, the view taken by the High Court in the
       matter cannot be flawed and deserves to be affirmed~ It         0
       is manifest from a bare reading of the Chargesheet, placed
       on record, that the gravamen of the allegations against
       the appellant as also the co-accused is that the co·mpany,
       acting through its directors in concert with the Chartered
       Accountants and some other persons: (i) conceived a             E
       criminal conspiracy and executed it by forging and
       fabricating a number of documents, like photographs of
       old machines, purchase orders and invoices showing
       purchase of machinery in order to support their claim to
     I avail hire purchase loan from PSB; (ii) on the strength of
       these false documents, PSB parted with the money by             F
       issuing pay orders & demand drafts in favour of the
       Company and (iii) the accused opened six fictitious
       accounts in the banks (four accounts in Bank of
       Rajasthan and two in Bank of Madura) to encash the pay
       orders/bank drafts issued by PSB in favour of the               G
       suppliers of machines, thereby directly rotating back the
       loan amount to the borrower from these fictitious
       accounts, and in the process committed a systematic
       fraud on the Bank (PSB) and obtained pecuniary
       advantage for themselves. Precise details of all the            H
   6        SUPREME COURT REPORTS             [2011] 8 S.C.R.
                                                                  •
A fictitious accounts as also the further flow of money
  realised on encashment of demand drafts/pay orders
  have been incorporated in the Chargesheet. Additionally,
  by allegedly claiming depreciation on the new
  machinery, whfoh was never purchased, on the basis of
B forged invoices etc.; the accused cheated the public
  exchequer as well. [Para 16) [18-F-H; 19-A-D]

       2.2. In the chargesheet, the accused are alleged to
  have committed offences punishable under Section
  1208, read with Sections 420, 409, 468 and 471 IPC. At
C this preliminary stage of proceedings, it would neither be
  desirable nor proper to return a final finding as to whether
  the essential ingredients of the said Sections are
  satisfied. On a conspectus of the factual scenario, prima
  facie, the Chargesheet does disclose the commission of
D offences by the appellant under the afore-noted Sections.
  [Para 17] [19-D~FJ

       3. The essential ingredient of the offence of "criminal
  conspiracy", defined in Section 120A IPC, is the
E agreement to commit an offence. In a case where the
  agreement is for accomplishment of an act which by
  itself constitutes an offence, then in that event, unless the
  Statute so requires, no overt act is necessary to be
  proved by the prosecution because in such a fact-
F situation criminal conspiracy is established by proving
  such an agreement. In other words, where the
  conspiracy alleged is with regard to commission of a
  serious crime of the nature as contemplated in Section
  1208 read with the proviso to sub-section (2) of Section
G 120A IPC, then in that event mere proof of an agreement
  between the accused for commission of such crime
  alone is enough to bring about a conviction under
  Section 1208 and the proof of any overt act by the
  accused or by any one of them would not be necessary.
  [Para 17) [19-F-H; 20-A-8]
H
•                SUSHIL SURI v. C.B.I. & ANR.                    7

         Suresh Chandra Bahri v. State of Bihar 1995 Supp (1)         A
    sec 80 - relied on.
          4. The definition of "forgery" in Section 463 IPC is
    also very wide. The basic elements of forgery are: (I) the
    making of a false document or part of it and (ii) such
                                                                B
    making should be with such intention as is specified in
    the Section viz. (a) to cause damage or injury to (i) the
    public, or (ii) any person; or (b) to support any claim or
    title; or (c) to cause any person to part with property; or
    (d) to cause any person to enter into an express or
    implied contract; or (e) to commit fraud or that fraud may C
    be committed. In the instant case more than sufficient
    circumstances exist suggesting the hatching of criminal
    conspiracy and forgery of several documents leading to
    comm!ssion of the aforementioned Sections. [Para.18)
    (20-C-E]                                                    D

         5.1. The judgments relied upon on behalf of the
    appellant are clearly distinguishable on facts. Even one
    additional or different fact may make a world of difference
    between the conclusions in two cases and blindly placing          E
    reliance on a decision is never proper. It is trite that while
    applying ratio, the Court may not pick out a word or
    sentence from the judgment divorced from the context in
    which the said.question arose for consideration. [Para 20)
    (22-F-G]
                                                                      F
         5.2. In the present case, having regard to the modus
    operandi adopted by the accused, as projected in the
    Chargesheet, it is clear that it is not a fit case for exercise
    of jurisdiction by the High Court under Section 482
    Cr.P.C. as also by this Court under Article 142 of the            G
    Constitution. The accused had not only duped PSB, they
    had also availed of depreciation on the machinery, which
    was never purchased and used by them, causing loss to
    the exchequer, a serious economic offence against the
    society. Merely because the dues of the bank have been            H
    8         SUPREME COURT REPORTS                [2011) 8 S.C.R.
                                                                     •
A paid up, the appellant cannot be ·exonerated from the
  criminal liability. Therefore, the Chargesheet against him
  cannot be quashed. The Trial Court is directed to proceed
  with the case as expeditiously as possible without being
  influenced by any observations made by the High Court
B or in this judgment on the merits of the Chargesheet.
  [Paras 21, 23] [23-D-E; 24-B-C]

       Nikhil Merchant v. Central Bureau of Investigation and
  Anr. (2008) 9 SCC 677: 2008 (12) SCR 236; Madan Mohan
  Abbot v. State of Punjab (2008) 4 SCC 582: 2008 (5) SCR
C 526 and B.S. Joshi and Ors. v. State of Haryana and Anr.
  (2003) 4 SCC 675: 2003 (2) SCR 1104 - distinguished.

        Zee Telefilms Ltd. and Anr. v. Union of India and Anr.
    (2005) 4 SCC 649: 2005 (1) SCR 913 and Haryana Financial
·o Corporation and Anr. v. Jagdamba Oil Mills and Anr. (2002)
    3 SCC 496: 2002 (1) SCR 621 and Rumi Dhar (Smt) v. State
  · of West Bengal and Anr. (2009) 6 SCC 364: 2009 (5)
     SCR 553 - relied on.

E       Sajjan Kumar v.Central Bureau of Investigation (2010)
    9 SCC 368: 2010 (11) SCR 669 - referred to.
                           Case Law Reference:
        2008 (12) SCR 236         Distinguished.         Para 6
F       2009 (5) SCR 553          Relied on.             Para 7
        2003 (2) SCR 1104         Distinguished.         Para 8
        2008 (5) SCR 526          Distinguished.         Para 8

G       (2009) 6 sec 351          Relied on.             Para 9
        2010 (11) SCR 669         Referred to ..         Para 9
        1960 SCR 388              Relied on.             Para 12
        2001 (3) Suppl. SCR 465 Relied on.               Para 13
H
•                SUSHIL SURI v. C.B.I. & ANR.                       9


      1991 (1) Suppl. SCR 387 Referred to.                Para 13       A
      1992 (1) Suppl. SCR 226 Referred to.                Para 14

      1995 Supp (1) SCC 80         Relied on.             Para 18

      2005 (1) SCR 913             Relied on.             Para 20
                                                                        B
      2002 (1) SCR 621             Relied on.             Para 21

        CRIMINAL APPELLATE JURISDICTION: Cirminal Appeal
    No. 1109 of 2011.

        From the Judgment & Order daed 21.5.2009 of the High            C
    Court of Delhi at New Delhi in Criminal Miscellaneous Case
    No. 3842 of 2008.

        H.P. Rawal, ASG, Vijay Aggarwal, Rajneesh Chopra,
    Sachin Midha, Priyanka Gupta, Rishabh Maheswari, Saurabh            D
    Seth, Yash Pal Dhingra, Vijay Aggarwal, Gurpeet Si,ngh,
    Shekhar Kumar, Shweta Verma, Mukesh Verma, Arvind Kumar
    Sharma, Jayant K. Sud, Harendra Singh, Anil Katiyar for the
    appearing parties.
                                                                        E
        The Judgment of the Court was delivered by

         D.K. JAIN, J. 1. Leave granted.

         2. This appeal, by special leave, is directed against
    judgment dated 21st May 2009 delivered by the High Court of         F
    Delhi in Criminal Misc. Case No.3842 of 2008, in a petition filed
    by the appellant herein under Section 482 of the Code of
    Criminal Procedure, 1973 (for short "the Cr.P.C."). By the
    impugned judgment, a learned Single Judge of the High Court
    has declined to quash the Chargesheet filed against the             G
    appellant and other directors of a Company, namely, Mis
    Morpen Laboratories Ltd. (for short "the Company") for offences
    punishable under Sections 1208, 420, 409, 468 and 471 of the
    Indian Penal Code, 1860 (for short "the IPC").
                                                                        H
    10         SUPREME COURT REPORTS                 [2011] 8 S.C.R.


A        3. Briefly stated, the facts, material for adjudication of the I
    issue, arising in this appeal, are as follows:

       A source information was received by the Central Bureau
  of Investigation (for short "the. CBI") that in the year 1999 two
  Chartered Accountants, namely, Sanjay Malik and Bipin
8
  Kakkar, had dishonestly and fraudulently opened/caused to be
  opened several fictitious accounts in some banks in the names
  of certain concerns, with an intention and object to facilitate the
  diversion of bank finance availed by various public limited
  companies for the purpose other than what had been stated in
C the loan application. On the basis of the said information, a First
  Information Report (FIR) was registered against the afore-
  mentioned Company and its directors. The relevant portion of
  the FIR reads thus:

D         ''That in June 1999, S/Sh. K.B. Suri, Sushil Suri and Smt.
         ·Kanta Suri, the Executive Directors of M/s. Morepen Labs
          Ltd. having their office at 416-418, Antriksh Bhawan (sic),
          22, K.G. Marg, New Delhi, conspired together and in
          furtherance of the said criminal conspiracy they, dishonestly
E         and fraudulently made an application to Punjab & Sind
          Bank, Connaught Place, New Delhi for Hire-Purchase
          Finance to the tune of Rs. 300 Lacs, by submitting fake
          and forged purchase orders, invoices and bills relating to
          supply sf machineries and equipments to be installed in
F         their factory/works situated in Distt. Solan (HP).
         That the above Executive Directors of the company,
         dishonestly, fraudulently and in conspiracy with other
         accused persons submitted to the bank, fake and forged
         invoices of fictitious/non-existent supplier i.e. M/s. R.K.
G        Engineers, M/s. Teem Metals Pvt. Ltd. and M/s. Malson
         lmpex, made accommodation payments representing as
         genuine advance payments to suppliers and thereby
         caused the bank to release funds to the tune of '300 lacs
         towards cost of machineries and equipments and pay
H        orders in various amounts issued by the bank for the
 SUSHIL SURI v. C.B.I. & ANR. [D.K. JAIN, J.]           11


 purpose of making payments to suppliers. These amounts      A
 were then· fraudulently deposited in several fictitious
 accounts of SISh. Sanjay Malik and Bipin Kakkar at
 Corporation Bank and Canara Bank and encashed. The
 bank finance raised by the company on the pretext of
 procurement of machineries and equipments were not          B
 used for the purpose stated in the application for loan,
 instead the bank loan was diverted by the above Executive
 Directors, in collusion with SISh. Sanjay Malik and Bipin
 Kakkar, for other undisclosed non-business purposes .
. That during the year 1998 also the above Executive C
  Directors of Mis. Morepen Labs Ltd. had adopted a
  similar modus-operandi in collusio.n with some other
  unknown persons/Chartered Accountants and applied for
  bank finance to the tune of Rs. 200 lacs for purchase of /
  machineries and equipments with an object to divert bank o
  finance for undisclosed non-business orders, invoices and
  bills of fictitious suppliers, i.e. Mis. B.K. Chemi-Plant
  Industries and M/s~ Flexon Hose and Engineering Co. Pvt.
  Ltd. and caused the bank to release loan of Rs. 200 lacs
  for the purpose of procurement of machineries and E
  equipments to be installed in their factory works situated
  in Distt. Solan (HP). The bank loan thus released by
  Punjab & Sind Bank (Hire-Purchase Branch), Connaught
  Circus, New Delhi was not actually used for the purpose
  stated in the loan proposal rather the pay orders issued
                                                              F
  by the bank in the name of fictitious suppliers Mis. Chemi-
  Plant Industries and Mis. Flexon Hose and Engineering
  Co. Pvt. Ltd. were deposited in fictitious accounts opened
  in the above name and style at Bank of Rajasthan, Kamla
  Nagar Branch, Delhi and encashed. No suppliers of
  machineries and equipments were made by Mis. B.K. G
  Chemi-Plant Industries and Mis. Flexon Hose and
  Engineering Co. Pvt. Ltd. to Mis. Morepen Labs. Ltd. and
  bank finance availed by the company for the said purpose
  were again used for some undisclosed non-business
  purposes.                                                   H
    12        SUPREME COURT REPORTS               [2011] 8 S.C.R.


A        The above facts and circumstances disclose the
         commission of offences uls 120-B, IPC r/w 420, 409, 468
         and 471 IPC and substantive offences thereunder against
         Chartered Accountants S/Sh. Sanjay Malik and Bipin
         Kakkar and S/Sh. K.B. Suri, Sushil Suri and Smt. Kanta
B        Suri, Executive Directors of M/s. Morepen Labs. Ltd., New
         Delhi and other unknown persons. Therefore, a regular
         case is registered and entrusted to Sh. A.K. Singh, Dy.
         SP/SIU-VII, for investigation."

         4. The Company is a public limited company, engaged in
C   the manufacturing of pharmaceutical products. In order to run
    its affairs, from time to time, the Company had been raising
    funds from different sources, like loans from different banks/
    financial institutions as also from the open market by way of
    'public issues', 'rights issues' and 'bonds' etc. Investigations
D   revealed that in the year 1998, the Company, through its
    directors, including the appellant in this appeal, applied for a
    hire purchase advance of Rs. 2 crores from Punjab and Sind
    Bank (for short "PSB"), Hire Purchase Branch, New Delhi, for
    purchase of various machinery items to be installed at their
E   manufacturing units at different places. It transpired that the
    machinery for which the loan was raised from PSB was never
    purchased by the Company and, in fact, to defraud PSB,
    photographs of the existing/some other machinery were taken
    by affixing labels of PSB and the same were filed with PSB,
F   as confirmation for having purchased the machinery, for which
    the loan was raised under the hire purchase limit. It was
    discovered that although the loan taken by the Company from
    PSB had been repaid, but the Company never purchased any
    machinery, utilising the funds disbursed by PSB against the
G   purchase of machinery. Furthermore, the value of the machinery,
    purportedly purchased with these funds, was reflected in the
    balance-sheet of the Company and even depreciation on the
    said machinery, amounting to Rs. 52,33,066/-, was also
    claimed in the Income Tax Return/Minimum Alternate Tax (MAD
H   for the assessment year 1998-1999, without any such
•          SUSHIL SURI v. C.B.I. & ANR. [D.K. JAIN, J.]         13


    machinery having been actually acquired.                          A

          5. In the year 1999, the Company and its directors again
    cipplied for hire purchase advance of Rs. 3 crores from PSB
    for purchase of more machines. In their balance-sheet for the
    assessment year 1999-2000, the Company again claimed the          B
    benefit of depreciation in the Income Tax/Minimum Alternate Tax
    amounting to Rs. 1,44,88,605/- although no such machinery
    was purchased by the Company. It further transpired that loan
    proposals were supported by forged proforma invoices.•
    purportedly issued by some suppliers in whose name fictitious     C
    bank accounts were opened to encash the Demand Drafts/Pay
    Orders issued by PSB in favour of these firms. The
    investigations thus, revealed that the appellant and a number
    of other persons had committed the afore-mentioned offences.
    Accordingly, a Chargesheet was filed by the CBI on 13th
    October, 2004 in the Court of Chief Metropolitan Magistrate,      D
    Delhi.

         6. The Chief Metropolitan Magistrate took cognizance of .
    the offences and summoned the accused to stand trial. On
    being so summoned, the appellant filed the afore-stated petition E
    under Section 482 of the Cr.P.C., praying for quashing of the
    Chargesheet mainly on the ground that once the Company had
    repaid the loan to PSB along with interest, no loss was caused
    to PSB and, therefore, they had not committed any offence for
    which Chargesheet had been filed. In support of the said plea, F
    decision of this Court in Nikhil Merchant Vs. Central Bureau
    of Investigation. & Anr1• was pressed into service. On behalf
    of the CBI, it was pleaded that the appellant and others, by
    forging documents/vouchers to show purchase of machinery,
    a pre-condition for release of instalments of loan, had not only G
    duped PSB but also defrauded the revenue ,by claiming
    depreciation on non-existent machinery and in the process
    cheated the public exchequer of crores of rupees.


    1.   (2008) g sec 677                                             H
    14         SUPREME COURT REPORTS               [2011] 8 S.C.R.       •
A       7. As already stated, the High Court has come to the
  conclusion that merely because the Company and its directors
  had repaid the loan to PSB they could not be exonerated of
  the offences committed by forging/fabricating the documents
  with the intention of defrauding the bank as well as the
B exchequer. The High Court was of the view that the ratio of the
  decision of this Court in Rumi Dhar (Smt) Vs. State of West
  Bengal & Anr. ,2 was applicable on the facts of the present case
  and the decision of this Court in Nikhil Merchant (supra) was
  clearly distinguishable on facts. Thus, the High Court held that
c on the peculiar facts of the case, the appellant was not entitled
  to any relief. Accordingly, the petition filed by the appellant was
  dismissed with costs. He was directed to appear before the
  trial court. Aggrieved thereby, the appellant is before us in this
  appeal.
D       8. Mr. Vijay Aggarwal, learned counsel appearing on
  behalf of the appellant assailed the judgment of the High Court
  on the ground that all the dues, as claimed by PSB having been
  paid by the debtor Company without demur, more so, when the
  Bank had not initiated any action for the recovery of money, the
E case of the appellant is on a much stronger footing as
  compared to the case of Nikhil Merchant (supra), wherein this
  Court had quashed the criminal proceedings initiated against
  the borrower in view of their compromise with the Bank. It was
  contended that since in the present case, there is no allegation
F that the appellant had committed any offence under the
  Prevention of Corruption Act 1988, at best, the allegation in the
  Chargesheet may attract Section 420 of the IPC, which offence
  is otherwise compoundable under Section 320 of the Cr.P.C.
  It was asserted that full amount in question having been paid
G to the Bank, there was no monetary loss to the Bank and,
  therefore, continuation of criminal proceedings against all the ·
  accused, including the appellant, would not only be an exercise
  In futility but an abuse of the process of law as well. It was thus,
  pleaded that it was a fit case where the High Court should have
H   2.   (2009) a sec 364
•          SUSHIL SURI v. C.B.I. & ANR. [D.K. JAIN, J.]           15


    exercised itsjurisdiction under Section 482 of the Cr.P.C. and A
    quashed the Chargesheet. In support, while relying heavily on
    the decision in Nikhil Merchant (supra), learned counsel al~o
    commended us to the decisions of this Court in B.S. Joshi &
    Ors. Vs. State of Haryana & Anr. 3 and Madan Mohan Abbot
    Vs.· State of Punjab4 • The decision in Rumi Dhar (supra) relied B .
    upon by the High Court, was sought to be distinguished by
    submitting that in that case the provisions of the Prevention of
    Corruption Act, 1988 had been invoked; the BaAk had to file a
    suit for recovery of the amount due to it and the Revision Petition
    filed against framing of charge against the accused in that case C
    had also been dismissed, which is not the case here.

         9. Per contra, Mr. H.P. Rawal, learned Additional Solicitor
    General of India, appearing for the CBI, supporting the
    impugned judgment, strenuously urged that having regard to the
    nature of. the allegations against the appellant, based on the      D
    evidence collected during the course of investigations, the High
    Court has rightly refused to exercise its jurisdiction under
    Section 482 of the Cr.P.C. Relying on a decision of this Court
    in Central Bureau of Investigation Vs. A. Ravishankar Prasad
    & Ors. 5, learned counsel contended that overwhelming material      E
    is available on record which clearly shows that the Company
    and its directors, including the appellant, and other persons had
    conspired to forge, fabricate and use documents in order to
    avail loan from the bank and had opened or caused to be
    opened fictitious bank accounts in the names of the suppliers       F
    to encash the pay orders/demand drafts issued by PSB and
    played fraud with PSB as also on the public exchequer by
    claiming depreciation on the machinery, which was never
    purchased. It was argued that the offences for which the
    appellant has been Chargesheeted would survive irrespective         G
    of discharge of debt of PSB by the Company. Relying on the
    decision of this Court in Sajjan Kumar Vs. Central Bureau of
    3.   (2003) g sec 677.
    4.   (2008) 4 sec 582
    5.   (2009) s sec 351,                                              H
    16         SUPREME COURT REPORTS                [2011) 8 S.C.R.       •
A lnvestigation6, learned counsel asserted that when the material
  on record is per se sufficient for the Court to form an opinion
  that the accused have committed the offences alleged against
  them and frame the said charges, there is no reason why the
  Chargesheet against the appellant should be quashed at such
B a preliminary stage when he has only been summoned to stand
  trial.

          10. Before embarking on an evaluation of the rival
    submis~ions, it would be instructive to briefly notice the scope
  and ambit of the inherent powers of the High Court under
C Section 482 of the Cr.P.C.

        11. Section 482 of the Cr.P.C. itself envisages three
  circumstances under which the inherent jurisdiction may be
  exercised by the High Court, namely: (i) to give effect to an order
o under the Cr.P.C.; (ii) to prevent an abuse of the process of
  Court; and (iii) to otherwise secure the ends of justice. It is trite
  that although the power possessed by the High Court under the
  said provision is very wide but it is not unbridled. It has to be
  exercised sparingly, carefully and cautiously, ex debito justitiae
E to do real and substantial justice for which alone the Court
  exists. Nevertheless, it is neither feasible nor desirable to lay
  down any inflexible rule which would govern the exercise of
  inherent jurisdiction of the Court. Yet, in numerous cases, this
  Court has laid down certain broad principles which may be
F borne in mind while exercising jurisdiction under Section 482
  of the Cr.P.C. Though it is emphasised that exercise of inherent
  powers would depend on the facts and circumstances of each
  case, but, the common thread which runs through all the
  decisions on the subject is that the Court would be justified in
G invoking its inherent jurisdiction where the allegations made in
  the Complaint or Chargesheet, as the case may be, taken at
  their face value and accepted in their entirety do not constitute
  the offence alleged.

          12. In one of the earlier cases in R.P. Kapur Vs. State of
H a.     c2010) 9 sec 368.
       SUSHIL SURI v. C.8.1. & ANR. [O.K. JAIN, J.]             17


Punjab 7 this Court had culled out some of the categories of          A
cases where the inherent powers under Section 482 of the
Cr.P.C. could be exercised by the High Court to quash criminal
proceedings against the accused. These are:

      "(i) where it manifestly appears that there is a legal bar · 8
      against the institution or continuance of the proceedings
      e.g. want of sanction;

      (ii) where the allegations in the first information report or
      the complaint taken at their face value and accepted in their
      entirety do not constitute the offence alleged;                 C

      (iii) where the allegations constitute an offence, but there
      is no legal evidence adduced or the evidence adduced
      clearly or manifestly fails to prove the charge."
                                                                      D
     13. In Dinesh Dutt Joshi Vs. State of Rajasthan & Anr., 8
while explaining the object and purpose of Section 482 of the
Cr.P.C., this Court had observed thus:

      "6 ....... The principle embodied in the section is based
      upon the maxim: quando lex aliquid alicui concedit,             E
      concedere videtur et id sine quo res ipsae esse non
      potest i.e. when the law gives anything to anyone, it gives
      also all those things without which the thing itself would be
      unavailable. The section does not confer any new power,
      but only declares that the High Court possesses inherent        F
      powers for the purposes specified in the section. As
      lacunae are sometimes found in procedural law, the
      section has been embodied to cover such lacunae
      wherever they are discovered. The use of extraordinary
      powers conferred upon the High Court under this section         G
      are however required to be reserved, as far as possible,
      for extraordinary cases."


7.   AIR 1960 SC 866.
a.   (2011) s sec s10.                                                H
        18         SUPREME COURT REPORTS               [2011] 8 S.C.R.


    A        14. Recently, this Court in A. Ravishankar Prasad & Ors.
       (supra), relied upon by learned counsel for the CBI, ret,erring
       to several earlier decisions on the point, including R.P. Kapur
       (supra); State of Haryana & Ors. Vs. Bhajan Lal & Ors. 9; Janata
     · Dal Vs. H.S. Chowdhary & Ors. 10 ; B.S. Joshi & Ors. (supra);
    B Nikhil Merchant (supra) etc. has reiterated that the exercise
       of inherent powers would entirely depend on the facts and
       circumstances of each case. It has been further observed that
       the inherent powers should not be exercised to stifle a legitimate
       prosecution. The High Court should normally refrain from giving
    C a prima facie decision in a case where all the facts are
       incomplete and hazy, more so, when the evidence has not been
       collected and produced before the Court and the issues
       involved, whether factual or legal, are of such magnitude that
       they cannot be seen in their true perspective without sufficient
,   D material.
            15. Bearing in mind the object, scope and width of power
      of the High Court under Section 482 of the Cr.P.C., enunciated
      above, the question for consideration is whether on facts in ·
    E hand, the High Court was correct in law in declining to exercise
      its jurisdiction under the said Section"'?

           16. Having examined the case in light of the allegations in
      the Chargesheet, we are of the opinion that the view taken by
      the High Court in the matter cannot be flawed and deserves to
    F be affirmed. It is manifest from a bare reading of the
      Chargesheet, placed on record, that the gravamen of the
      allegations against the appellant as also the co-accused is that
      the Company, acting through its directors in concert with the
      Chartered Accountants and some other persons: (i) conceived
    G a criminal conspiracy and executed it by forging and fabricating
      a number of documents, like photographs of old machines,
      purchase orders and invoices showing purchase of machinery
      in order to support their claim to avail hire purchase loan from
        9.   1002 supp (1) sec 335.
    H 10. (1992) 4 sec 305.
•       SUSHIL SURI v. C.B.I. & ANR. (D.K. JAIN, J.]            19


    PSB; (ii) on the strength of these false documents, PSB parted    A
    with the money by issuing pay orders & demand drafts in favour
    of the Company and (iii) the accused opened six fictitious
    accounts in the banks (four accounts in Bank of Rajasthan and
    two in Bank of Madura) to encash the pay orders/bank drafts
    issued by PSB in favour of the suppliers of machines, thereby     B
    directly rotating back the loan amount to the borrower from
    these fictitious accounts, and in the process committed a
    systematic fraud on the Bank· (PSB) and obtained pecuniary
    advantage for themselves. Precise details of all the fictitious
    accounts as also the further flow of money realised on            c
    encashment of demand drafts/pay orders have been
    incorporated in the Chargesheet. Additionally, by allegedly
    claiming depreciation on the new machinery, which was never
    purchased, on the basis of forged invoices etc.; the accused
    cheated the.public exchequer as well.
                                                                      D
         17. As afore·stated, in the Chargesheet, the accused are
    alleged to have committed offences punishable under Section
    120B, read with Sections 420, 409, 468 and 471 IPC. We feel
    that at this preliminary stage of proceedings, it would neither
    be desirable nor proper to return a final finding as to whether E
    the essential ingredients of the said Sections are satisfied. For
    the purpose of the present appeal, it will suffice to observe that
    on a conspectus of the factual scenario, noted above, prima
    facie, the Chargesheet does disclose the commission of
    offences by the appellant under the afore·noted Sections. The F
    essential ingredient of the offence of "criminal conspiracy",
    defined in Section 120A IPC, is the agreement to commit an
    offence. In a case where the agreement is for accomplishment
    of an act which by itself constitutes an offence, then in that
    event, unless the Statute so requires, no overt act is necessary G
    to be proved by the pros~cution because in such a fact·
    situation criminal conspiracy is established by proving such an
    agreement. In other words, where the conspiracy alleged is with
    regard to commission of a serious crime of the nature as .
    contemplated in Section 1209 read with the proviso to sub· H
    20       SUPREME COURT REPORTS                [2011] 8 S.C.R.       •
A section (2) of Section 120A IPC, then in that event mere proof
  of an agreement between the accused for commission of such
  crime alone is enough to bring about a conviction under Section
  120B and the proof of any overt act by the accused or by any
  one of them would not be necessary. (See: Suresh Chandra
B Bahri Vs. State of Bihar11 ).

        18. Similarly, the definition of "forgery" in Section 463 IPC
  is very wide. The basic elements of forgery are: (i) the making
  of a false document or part of it and (ii) such making should
C be with such intention as is specified in the Section viz. (a) to
  cause damage or injury to (i) the public, or (ii) any person; or
  (b) to support any claim or title; or (c) to cause any person to
  part with property; or (d) to cause any person to enter into an
  express or implied contract; or (e) to commit fraud or that fraud
  may be committed. As stated above, in the instant case more
D than sufficient circumstances exist suggesting the hatching of
  criminal conspiracy and forgery of several documents leading
  to commission of the aforementioned Sections. We refrain from
  saying more on the subject at this juncture, lest it may cause
  prejudice to the appellant or the prosecution.
E
        19. We may now advert to the decision of this Court in the
  case of Nikhil Merchant (supra), on which great emphasis was
  laid, on behalf of the appellant. In that case a Chargesheet was
  filed by the CBI against the accused under Section 120B read
F with Sections 420, 467, 468, 471 IPC read with Sections 5(2)
  and 5(1)(d) of the Prevention of Corruption Act, 1947 and
  Section 13(2) read with Section 13(1 )(d) of the Prevention of
  Corruption Act, 1988. The allegation under the Chargesheet
  was that the accused persons had conspired with each other
G in fraudulently diverting the funds of the Bank. Offence alleging
  forgery was also included in the Chargesheet. In the meantime,
  the suit for recovery of money filed by the Bank against the
  Company, to which the appellant in that case was also a party,
  was disposed of on a written compromise arrived at between
H 11. 1995 Supp (1) sec ao.
•        SUSHIL SURI v. C.B.I. & ANR. [D.K. JAIN, J.]               21


    the parties. Consequent upon the compromise of the suit and           A
    having regard .to the contents of clause 11 of the consent terms,
    which stipulated that neither party had any claim against the
    other and parties were withdrawing all allegatior:is and counter
    allegations made against each other, the said appellant filed
    an application for discharge. The application was rejected by         B
    the trial court. A petition preferred under Section 482 of the
    Cr.P.C. was also dismissed by the High Court. In further appeal
    to this Court, accepting the contention of the appellant that this
    Court could transcend the limitation imposed under Section 320
    of the Cr.P .C. and pass orders quashing criminal proceedings         C
    even where non compoundable offences were involved,
    quashing the criminal proceedings the Court observed thus:

        "30. In the instant case, the disputes between the Company .
        and the Bank have been set at rest on the basis of the
        compromise arrived at by them whereunder the dues of D
        the Bank have been cleared and the Bank does not appear
        to have any further claim against the Company. What,
        however, remains is the fact that certain documents were
        alleged to have been created by the appellant herein in
        order to avail of credit facilities beyond the limit to which E
        the Company was entitled. The dispute involved herein has
        overtones of a civil dispute with certain criminal facets. The
        question which is required to be answered in this case is
        whether the power which independently lies with this
        Court to quash the criminal proceedings pursuant to the F
        compromise arrived at, should at all be exercised?

          31. On an overall view of the facts as indicated
          hereinabove and keeping in mind the decision of this Court
          in B. S. Joshi case and the compromise arrived at between
        . the Company and. the Bank as also Cl.ause .11 of the            G
         consent terms filed in the suit .filed by the Bank, we are
         satisfied thatthis is a fit case where technicality should not
         be allowed to stand in the way in the quashing of the
          criminal proceedings, since, in our view, the continuance
                                                                          H
    22        SUPREME COURT REPORTS                  (2011) 8 S.C.R.       •
A        of the same after the compromise arrived at between the
         parties would be a futile exercise."

                                                [Emphasis supplied)

          20. A bare reading of the afore-extracted paragraphs
B   would indicate that the question posed for consideration in that
    case was with regard to the power of this Court under Article
    142 of the Constitution of India to quash the criminal
    proceedings in the facts and circumstances of a given case and
    not in relation to the powers of the High Court under Section
C   482 of the Cr.P.C. The Court came to the conclusion that it was
    a fit case where it should exercise its powers under Article 142
    of the Constitution. In our opinion, Nikhil Merchant (supra) does
    not hold as an absolute proposition of law that whenever a
    dispute between the parties, having overtones of a civil dispute
D   with criminal facets is settled between them, continuance of
    criminal proceedings would be an exercise in futility and,
    therefore, should be quashed. Similarly, in B.S. Joshi & Ors.
    (supra), which has been relied upon in Nikhil Merchant (supra),
    the question for consideration was whether the High Court in
E   exercise of its inherent powers can quash criminal proceedings
    or FIR or Complaint for offences which are not compoundable
    under Section 320 of the Cr.P.C. It was held that Section 320
    cannot limit or affect the powers of the High Court under
    Section 482 of the Cr.P.C., a well settled proposition of law.
F   We are of the opinion that Nikhil Merchant (supra) as also the
    other two judgments relied upon on behalf of the appellant are
    clearly distinguishable on facts. It needs little emphasis that even
    one additional or different fact may make a world of difference
    between the conclusions in two cases and blindly placing
G   reliance on a decision is never proper. It is trite that while
    applying ratio, the Court may not pick out a word or sentence
    from the judgment divorced from the context in which the said
    question arose for consideration. (See: Zee Telefilms Ltd. &
    Anr. Vs. Union of India & Anr. 12). In this regard, the following
H 12. (2005) 4 sec 649 ..
•        SUSHIL SURI v. C.B.I. & ANR. (D.K. JAIN, J.]              23


    words of Lord Denning, quoted in Haryana Financial A
    Corporation & Anr. Vs. Jagdamba Oil Mills & Anr. 13 , are also ·
    quite apt:                      ·

         "Each case depends on its own facts and a close similarity
         between one case and anoth~r is not enough because              B
         even a single significant detail may alter the entire aspect.
         In deciding such cases, one should avoid the temptation
         to decide cases (as said by Cardozo) by matching the
         colour of one case against the colour of another.· To decide,
         therefore, on which side of the line a case _falls, the broad   C
         resemblance to another case is not at all decisive."

        21. In the present case, having regard to the modus
   operandi adopted by the accused, as projected in the
. Chargesheet and briefly referred to in para 17 (supra), we have
   no hesitation in holding that it is not a fit case for exercise of    D
  jurisdiction by the High Court under Section 482 ofthe.Cr.P.C.
  as also by this Court under Article 142 of the Constitution of
  India. As noted above, the accused had not only duped PSB,
  they had also availed of depreciation on the machinery, which
  was never purchased and used by them, causing loss to the              E
  exchequer, a serious economic offence against the society.

          22. The view we have taken above, gets fortified by a
    recent decision of this Court in Rumi Dhar (supra), wherein
    while dealing with a fact situation, akin to the present case,
    referring to the decision in Nikhil Merchant (supra), the Court      F
    declined to quash criminal proceedings in that case, observing
    thus:

         "24. The jurisdiction of the Court under Article 142 of the
         Constitution of India is not in dispute. Exercise of such       G
         power would, however, depend on the facts and
         circumstances of each case. The High Court, in exercise
         of its jurisdiction under Section 482 of the Code of
         Criminal Procedure, and this Court, in terms of Article 142
    13. (2002) 3 sec 496.                                                H
    24       SUPREME COURT REPORTS                [2011] 8 S.C.R.
                                                                        •
A        of the Constitution of India, would not direct quashing of a
         case involving crime against the society particularly when
         both the learned Special Judge as also the High Court
         have found that a prima facie case has been made out
         against the appellant herein for framing the charge."
B
       23. We respectfully concur with the afore-extracted
  observations. In the final analysis, we hold that merely because
  the dues of the bank have been paid up, the appellant cannot
  be exonerated from the criminal liability. Therefore, the
C Chargesheet against him cannot be quashed.

       24. In view of the foregoing discussion, we do not find any
  merit in this appeal and it is dismissed accordingly. The Trial
  Court shall now proce_ed with the case as expeditiously as
  possible without being influenced by any observations made
D by the High Court or in this judgment on the merits of the
  Chargesheet.

    B.B.B.                                      Appeal dismissed.