LAWYERS ADVICE -NEGLIGENCE
Whether lawyers are liable for wrong advices or negligence,the Hon'ble Supreme Court of India answered many questions pertaining to criminal liability of lawyers advice and held that lawyers are not able for negligence ,while performing professional duty,unless he is part of fraudulent transaction.
The Apex Court said "A lawyer does not tell his client that he shall win the case in all
circumstances. Likewise a physician would not assure the patient of full
recovery in every case. A surgeon cannot and does not guarantee that the result
of surgery would invariably be beneficial, much less to the extent of 100% for
the person operated on. The only assurance which such a professional can give
or can be given by implication is that he is possessed of the requisite skill
in that branch of profession which he is practising and while undertaking the
performance of the task entrusted to him, he would be exercising his skill with
reasonable competence. This is what the person approaching the professional can
expect. Judged by this standard, a professional may be held liable for
negligence on one of the two findings, viz., either he was not possessed of the
requisite skill which he professed to have possessed, or, he did not exercise,
with reasonable competence in the given case, the skill which he did possess"
This is original text of judgement
Central
Bureau of Investigation, Hyderabad Vs. K. Narayana Rao
[Criminal
Appeal No. 1460 of 2012 arising out of S.L.P. (CRL.) No. 6975 of 2011]
P.Sathasivam,J.
1.
Leave granted.
2. This
appeal is directed against the final judgment and order dated09.07.2010 passed
by the High Court of Judicature, Andhra Pradesh at Hyderabad in Criminal
Petition No. 2347 of 2008 whereby the High Court allowed the petition filed by
the respondent herein under Section 482 of the Code of Criminal Procedure, 1973
(in short "the Code") and quashed the criminal proceedings pending
against him in CC No. 44 of 2007 (Crime No. 36of 2005) on the file of the
Special Judge for CBI cases, Hyderabad.
3.
Brief facts:
a.
According to the prosecution, basing on an information, on30.11.2005, the CBI,
Hyderabad registered an FIR being RC 32(A)/2005against Shri P. Radha Gopal
Reddy (A-1) and Shri Udaya Sankar (A-2), the then Branch Manager and the
Assistant Manager, respectively of the Vijaya Bank, Narayanaguda Branch,
Hyderabad, for the commission of offence punishable under Sections 120-B, 419,
420, 467, 468 471 read with Section109 of the Indian Penal Code, 1860 (in short
'the IPC') and Section 13(2)read with Section 13(1)(d) of the Prevention of
Corruption Act, 1988 for abusing their official position as public servants and
for having conspired with private individuals, viz., Shri P.Y. Kondala Rao -
the builder (A-3)and Shri N.S. Sanjeeva Rao (A-4) and other unknown persons for
defrauding the bank by sanctioning and disbursement of housing loans to 22
borrowers in violation of the Bank's rules and guidelines and thereby caused
wrongful loss of Rs. 1.27 crores to the Bank and corresponding gain for
themselves. In furtherance of the said conspiracy, A-2 conducted the
pre-sanction inspection in respect of 22 housing loans and A-1 sanctioned the
same.
b.
After completion of the investigation, the CBI filed charge sheet along with
the list of witnesses and the list of documents against all the accused
persons. In the said charge sheet, Shri K. Narayana Rao, the respondent herein,
who is a legal practitioner and a panel advocate for the Vijaya Bank, was also
arrayed as A-6. The duty of the respondent herein as a panel advocate was to
verify the documents and to give legal opinion. The allegation against him is
that he gave false legal opinion in respect of 10 housing loans. It has been
specifically alleged in the charge sheet that the respondent herein (A-6) and
Mr. K.C. Ramdas (A-7)-the valuer have failed to point out the actual ownership
of the properties and to bring out the ownership details and name of the
apartments in their reports and also the falsity in the permissions for
construction issued by the Municipal Authorities.
c.
Being aggrieved, the respondent herein (A-6) filed a petition being Criminal
Petition No. 2347 of 2008 under Section 482 of the Code before the High Court
of Andhra Pradesh at Hyderabad for quashing of the criminal proceedings in CC
No. 44 of 2007 on the file of the Special Judge for CBI Cases, Hyderabad. By
impugned judgment and order dated 09.07.2010, the High Court quashed the
proceedings insofar as the respondent herein (A-6) is concerned.(d) Being
aggrieved, the CBI, Hyderabad filed this appeal by way of special leave.
4.
Heard Mr. H.P. Raval, learned Additional Solicitor General for the
appellant-CBI and Mr. R. Venkataramani, learned senior counsel for the
respondent (A-6).
5.
After taking us through the allegations in the charge sheet presented before
the special Court and all other relevant materials, the learned ASG has raised
the following contentions:
i.
The High Court while entertaining the petition under Section 482 of the Code
has exceeded its jurisdiction. The powers under Section 482 are inherent which
are to be exercised in exceptional and extraordinary circumstances. The power
being extraordinary has to be exercised sparingly, cautiously and in
exceptional circumstances;
ii.
The High Court has committed an error in holding that no material had been
gathered by the investigating agency against the respondent herein (A-6) that
he had conspired with the remaining accused for committing the offence; and
iii.
There is no material on record to show that the respondent herein (A-6) did not
verify the originals pertaining to housing loans before giving legal opinion
and intentionally changed the proforma and violated the Bank's circulars.
6.
On the other hand, Mr. Venkataramani, learned senior counsel for the respondent
(A-6), after taking us through the charge sheet and the materials placed before
the respondent seeking legal opinion, submitted that he has not committed any
offence much less an offence punishable under Section 120-B read with Sections
419, 420, 467, 468, 471 and 109 of IPC and Section 13(2) read with Section
13(1)(d) of the Prevention of Corruption Act, 1988. He further submitted that
based on the documents placed, the respondent herein after perusing and on
satisfying himself, furnished his legal opinion for which he cannot be implicated
as one of the conspirators for the offence punishable under Section 420 read
with Section 109 IPC.
7.
We have carefully perused all the relevant materials and considered the rival
submissions.
8.
In order to appreciate the stand of the CBI and the defence of therespondent,
it is necessary to refer the specific allegations in the charge sheet. The
respondent herein has been arrayed as accused No. 6 in the charge sheet and the
allegations against him are as under: "Para 20: Investigation revealed
that legal opinions in respect of all these 10 loans have been given by Panel
Advocate - Sri K. Narayana Rao (A-6) and valuation reports were given by
Approved Valuer - Sri V.C. Ramdas(A-7). Both, the advocate and the valuer, have
failed to point out the actual ownership of the property and failed to bring
out the ownership details and name of the apartments in their reports.
They
have also failed to point out the falsehood in the construction permission
issued by the municipal authorities. Para 28: Investigation revealed that the
municipal permissions submitted to the bank were also fake. Para 29: Expert of
Finger Print Bureau confirmed that the thumb impressions available on the
questioned 22 title deeds pertain to A-3, A-4 and A-5. Para 30: The above facts
disclose that Sri P. Radha Gopal Reddy (A-1) and Sri M. Udaya Sankar (A-2)
entered into criminal conspirary with A- 3 and abused their official position
as public servants by violating the bank norms and in the process caused
wrongful gain to A-3 to the extent of Rs.1,00,68,050/- and corresponding
wrongful loss to the bank in sanctioning 22 housing loans. Sri P.Y. Kondal
Rao(A-3) registered false sale deeds in favour of borrowers using impostors as
site owners, produced false municipal permissions and cheated the bank in
getting the housing loans. He is liable for conspiracy, cheating, forgery for
the purpose of cheating and for using forged documents as genuine.
Sri
B. Ramanaji Rao(A-4) and Sri R. Sai Sita Rama Rao(A-5) impersonated as site
owners, executed the false sale deeds. They are liable for impersonation,
conspiracy, cheating, forging a valuable security and forgery for the purpose
of cheating. Sri K. Narayana Rao (A-6) submitted false legal opinions and Sri
K.C. Ramdas(A-7) submitted false valuation reports about the genuineness of the
properties in collusion with A-3 for sanction of the loans by Vijaya Bank,
Narayanaguda branch, Hyderabad and abetted the crime.
Sri
A.V. Subba Rao(A-8) managed verification of salary slips of the borrowers of 12
housing loans in collusion with A-3 and abetted the crime. Para 33: In view of
the above, the accused A-1, A-2, A-3, A-4, A-5, A- 6, A-7 & A-8 are liable
for offences punishable under Section 120-B read with Sections 419, 420, 467,
468, 471 and 109 read with Section 420 IPC and Section 13(2) read with Section
13(1)(d) of the Prevention of Corruption Act and substantive offences
thereof."With the above details, let us consider whether there is prima
facie allegation(s) and material(s) in order to pursue the trial against the
respondent herein. In the same way, we have to see whether the reasoning and
the ultimate conclusion of the High Court in quashing the charge sheet against
the respondent herein (A-6) is sustainable. We are conscious of the power and
jurisdiction of the High Court under Section 482 of the Code for interfering
with the criminal prosecution at the threshold.
9.
Mr. Raval, learned ASG in support of his contentions relied on the following
decisions:
i.
State of Bihar vs. Ramesh Singh, (1977) 4 SCC 39;
ii.
P. Vijayan vs. State of Kerala and Another, (2010) 2 SCC 398; and
iii.
Sajjan Kumar vs. Central Bureau of Investigation, (2010) 9 SCC 368.
10.
The first decision Ramesh Singh (supra) relates to interpretation of Sections
227 and 228 of the Code for the considerations as to discharge the accused or
to proceed with trial. Para 4 of the said judgment is pressed into service
which reads as under: "4. Under Section 226 of the Code while opening the
case for the prosecution the Prosecutor has got to describe the charge against
the accused and state by what evidence he proposes to prove the guilt of the
accused. Thereafter comes at the initial stage the duty of the Court to
consider the record of the case and the documents submitted therewith and to
hear the submissions of the accused and the prosecution in that behalf.
The
Judge has to pass thereafter an order either under Section 227 or Section 228
of the Code. If "the Judge considers that there is no sufficient ground
for proceeding against the accused, he shall discharge the accused and record
his reasons for so doing", as enjoined by Section 227. If, on the other
hand, "the Judge is of opinion that there is ground for presuming that the
accused has committed an offence which - (b) is exclusively triable by the
Court, he shall frame in writing a charge against the accused", as
provided in Section 228. Reading the two provisions together in juxtaposition,
as they have got to be, it would be clear that at the beginning and the initial
stage of the trial the truth, veracity and effect of the evidence which the
Prosecutor proposes to adduce are not to be meticulously judged. Nor is any
weight to be attached to the probable defence of the accused.
It
is not obligatory for the Judge at that stage of the trial to consider in any
detail and weigh in a sensitive balance whether the facts, if proved, would be
incompatible with the innocence of the accused or not. The standard of test and
judgment which is to be finally applied before recording a finding regarding
the guilt or otherwise of the accused is not exactly to be applied at the stage
of deciding the matter under Section 227 or Section 228 of the Code. At that
stage the Court is not to see whether there is sufficient ground for conviction
of the accused or whether the trial is sure to end in his conviction. Strong
suspicion against the accused, if the matter remains in the region of
suspicion, cannot take the place of proof of his guilt at the conclusion of the
trial.
But
at the initial stage if there is a strong suspicion which leads the Court to
think that there is ground for presuming that the accused has committed an
offence then it is not open to the Court to say that there is no sufficient
ground for proceeding against the accused. The presumption of the guilt of the
accused which is to be drawn at the initial stage is not in the sense of the
law governing the trial of criminal cases in France where the accused is
presumed to be guilty unless the contrary is proved. But it is only for the
purpose of deciding prima facie whether the Court should proceed with the trial
or not. It the evidence which the Prosecutor proposes to adduce to prove the
guilt of the accused even if fully accepted before it is challenged in
cross-examination or rebutted by the defence evidence, if any, cannot show that
the accused committed the offence, then there will be no sufficient ground for
proceeding with the trial.
An
exhaustive list of the circumstances to indicate as to what will lead to one
conclusion or the other is neither possible nor advisable. We may just
illustrate the difference of the law by one more example. If the scales of pan
as to the guilt or innocence of the accused are something like even, at the
conclusion of the trial, then, on the theory of benefit of doubt the case is to
end in his acquittal. But if, on the other hand, it is so at the initial stage
of making an order under Section 227 or Section 228, then in such a situation
ordinarily and generally the order which will have to be made will be one under
Section 228 and not under Section 227.
11.
"Discharge of accused under Section 227 of the Code was extensively
considered by this Court in P. Vijayan (supra) wherein it was held asunder:
"10. If two views are possible and one of them gives rise to suspicion
only, as distinguished from grave suspicion, the trial Judge will be empowered
to discharge the accused and at this stage he is not to see whether the trial
will end in conviction or acquittal. Further, the words "not sufficient
ground for proceeding against the accused" clearly show that the Judge is
not a mere post office to frame the charge at the behest of the prosecution,
but has to exercise his judicial mind to the facts of the case in order to
determine whether a case for trial has been made out by the prosecution. In
assessing this fact, it is not necessary for the court to enter into the pros
and cons of the matter or into a weighing and balancing of evidence and
probabilities which is really the function of the court, after the trial
starts. 11. At the stage of Section 227, the Judge has merely to sift the
evidence in order to find out whether or not there is sufficient ground for
proceeding against the accused. In other words, the sufficiency of ground would
take within its fold the nature of the evidence recorded by the police or the
documents produced before the court which ex facie disclose that there are
suspicious circumstances against the accused so as to frame a charge against
him.
12.
"While considering the very same provisions i.e., framing of charges and
discharge of accused, again in Sajjan Kumar (supra), this Court held thus:
"19. It is clear that at the initial stage, if there is a strong suspicion
which leads the court to think that there is ground for presuming that the
accused has committed an offence, then it is not open to the court to say that
there is no sufficient ground for proceeding against the accused. The
presumption of the guilt of the accused which is to be drawn at the initial
stage is only for the purpose of deciding prima facie whether the court should
proceed with the trial or not.
If
the evidence which the prosecution proposes to adduce proves the guilt of the
accused even if fully accepted before it is challenged in cross-examination or
rebutted by the defence evidence, if any, cannot show that the accused
committed the offence, then there will be no sufficient ground for proceeding
with the trial. 20. A Magistrate enquiring into a case under Section 209 CrPC
is not to act as a mere post office and has to come to a conclusion whether the
case before him is fit for commitment of the accused to the Court of Session.
He is entitled to sift and weigh the materials on record, but only for seeing
whether there is sufficient evidence for commitment, and not whether there is
sufficient evidence for conviction. If there is no prima facie evidence or the
evidence is totally unworthy of credit, it is the duty of the Magistrate to
discharge the accused, on the other hand, if there is some evidence on which
the conviction may reasonably be based, he must commit the case.
It
is also clear that in exercising jurisdiction under Section 227 CrPC, the
Magistrate should not make a roving enquiry into the pros and cons of the
matter and weigh the evidence as if he was conducting a trial. Exercise of
jurisdiction under Sections 227 and 228 CrPC 21. On consideration of the
authorities about the scope of Sections 227 and 228 of the Code, the following
principles emerge:
i.
The Judge while considering the question of framing the charges under Section
227 CrPC has the undoubted power to sift and weigh the evidence for the limited
purpose of finding out whether or not a prima facie case against the accused
has been made out. The test to determine prima facie case would depend upon the
facts of each case.
ii.
Where the materials placed before the court disclose grave suspicion against
the accused which has not been properly explained, the court will be fully
justified in framing a charge and proceeding with the trial.
iii.
The court cannot act merely as a post office or a mouthpiece of the prosecution
but has to consider the broad probabilities of the case, the total effect of
the evidence and the documents produced before the court, any basic infirmities,
etc. However, at this stage, there cannot be a roving enquiry into the pros and
cons of the matter and weigh the evidence as if he was conducting a trial.
iv.
If on the basis of the material on record, the court could form an opinion that
the accused might have committed offence, it can frame the charge, though for
conviction the conclusion is required to be proved beyond reasonable doubt that
the accused has committed the offence.
v.
At the time of framing of the charges, the probative value of the material on
record cannot be gone into but before framing a charge the court must apply its
judicial mind on the material placed on record and must be satisfied that the
commission of offence by the accused was possible.
vi.
At the stage of Sections 227 and 228, the court is required to evaluate the
material and documents on record with a view to find out if the facts emerging
there from taken at their face value disclose the existence of all the
ingredients constituting the alleged offence. For this limited purpose, sift
the evidence as it cannot be expected even at that initial stage to accept all
that the prosecution states as gospel truth even if it is opposed to common
sense or the broad probabilities of the case.
vii.
If two views are possible and one of them gives rise to suspicion only, as
distinguished from grave suspicion, the trial Judge will be empowered to
discharge the accused and at this stage, he is not to see whether the trial
will end in conviction or acquittal."From the above decisions, it is clear
that at the initial stage, if there is a strong suspicion which leads the Court
to think that there is ground for presuming that the accused has committed an
offence, in that event, it is not open to the Court to say that there is no
sufficient ground for proceeding against the accused.
A
judicial magistrate enquiring into a case under Section 209 of the Code is not
to act as a mere post office and has to arrive at a conclusion whether the case
before him is fit for commitment of the accused to the Court of Session. He is
entitled to sift and weigh the materials on record, but only for seeing whether
there is sufficient evidence for commitment, and not whether there is
sufficient evidence for conviction. On the other hand, if the Magistrate finds
that there is no prima facie evidence or the evidence placed is totally
unworthy of credit, it is his duty to discharge the accused at once.
It
is also settled law that while exercising jurisdiction under Section 227 of the
Code, the Magistrate should not make a roving enquiry into the pros and cons of
the matter and weigh the evidence as if he was conducting a trial. This
provision was introduced in the Code to avoid wastage of public time and to
save the accused from unavoidable harassment and expenditure. While analyzing
the role of the respondent herein (A-6) from the charge sheet and the materials
supplied along with it, the above principles have to be kept in mind.
13.
In Rupan Deol Bajaj (Mrs.) and Another vs. Kanwar Pal Singh Gill and Another,
(1995) 6 SCC 194, this Court has considered the scope of quashingan FIR and
held that it is settled principle of law that at the stage of quashing an FIR
or complaint, the High Court is not justified in embarking upon an enquiry as
to the probability, reliability or genuineness of the allegations made therein.
By noting the principles laid down in State of Haryana vs. Bhajan Lal, 1992
Supp (1) SCC 335, this Court held that an FIR or a complaint may be quashed if
the allegations made therein are so absurd and inherently improbable that no
prudent person can ever reach a just conclusion that there is sufficient ground
for proceeding against theaccused.
14.
In Mahavir Prashad Gupta and Another vs. State of National Capital Territory of
Delhi and Others, (2000) 8 SCC 115, this Court considered the jurisdiction of
the High Court under Section 482 of the Code and held asunder: "5. The law
on the subject is very clear. In the case of State of Bihar v. Murad Ali Khan
(1988) 4 SCC 655 it has been held that jurisdiction under Section 482 of the
Code of Criminal Procedure has to be exercised sparingly and with
circumspection.
It
has been held that at an initial stage a court should not embark upon an
inquiry as to whether the allegations in the complaint are likely to be
established by evidence or not. Again in the case of State of Haryana v. Bhajan
Lal 1992 Supp. (1) SCC 335 this Court has held that the power of quashing
criminal proceedings must be exercised very sparingly and with circumspection
and that too in the rarest of rare cases. It has been held that the court would
not be justified in embarking upon an inquiry as to the reliability or
genuineness or otherwise of the allegations made in the FIR or the complaint.
It has been held that the extraordinary or inherent powers did not confer an
arbitrary jurisdiction on the court to act according to its whim or caprice.
15.
Regarding conspiracy, Mr. Raval, learned ASG after taking us through the
averments in the charge sheet based reliance on a decision of this Court in
Shivnarayan Laxminarayan Joshi and Others vs. State of Maharashtra, (1980) 2
SCC 465 wherein it was held that once the conspiracy to commit an illegal act
is proved, act of one conspirator becomes the act of the other. By pointing out
the same, learned ASG submitted that the respondent herein (A-6), along with
the other conspirators defrauded the Bank's money by sanctioning loans to
various fictitious persons.
16.
We have already extracted the relevant allegations and the role of the
respondent herein (A-6). The only allegation against the respondent is that he
submitted false legal opinion to the Bank in respect of the housing loans in
the capacity of a panel advocate and did not point out actual ownership of the
properties. As rightly pointed out by Mr. Venkataramani, learned senior counsel
for the respondent, the respondent was not named in the FIR. The allegations in
the FIR are that A-1 to A-4 conspired together and cheated Vijaya Bank,
Narayanaguda, Hyderabad to the tune of Rs. 1.27crores.
It
is further seen that the offences alleged against A-1 to A-4 are the offences
punishable under Sections 120B, 419, 420, 467, 468 and 471 of IPC and Section
13(2) read with Section 13 (1)(d) of the Prevention of Corruption Act, 1988. It
is not in dispute that the respondent is a practicing advocate and according to
Mr. Venkataramani, he has experience in giving legal opinion and has conducted
several cases for the banks including Vijaya Bank. As stated earlier, the only
allegation against him is that he submitted false legal opinion about the
genuineness of the properties in question.
It
is the definite stand of the respondent here in that he has rendered Legal
Scrutiny Reports in all the cases after perusing the documents submitted by the
Bank. It is also his claim that rendition of legal opinion cannot be construed
as an offence. He further pointed out that it is not possible for the panel
advocate to investigate the genuineness of the documents and in the present
case, he only perused the contents and concluded whether the title was conveyed
through a document or not.
It
is also brought to our notice that LW-5 (Listed Witness), who is the Law
Officer of Vijaya Bank, has given a statement regarding flaw in respect of
title of several properties. It is the claim of the respondent that in his
statement, LW-5 has not even made a single comment as to the veracity of the
legal opinion rendered by the respondent herein. In other words, it is the
claim of the respondent that none of the witnesses have spoken to any overt act
on his part or his involvement in the alleged conspiracy. Learned senior
counsel for the respondent has also pointed out that out of 78 witnesses no one
has made any relevant comment or statement about the alleged involvement of the
respondent herein in the matter inquestion.
17.
In order to appreciate the claim and the stand of the respondent herein as a
panel advocate, we have perused the legal opinion rendered by the respondent
herein in the form of Legal Scrutiny Report dated 10.09.2003as to the title
relating to Sri B.A.V.K. Mohan Rao, S/o late Shri Someshwar Rao which is as
under.
"Legal
Scrutiny Report
Dated:
10.09.2003.
To
The
Branch Manager,
Vijaya
Bank,
Narayanaguda
Hyderabad
Sir,
Sub:-
Title Opinion Shri BAVK Mohan Rao
S/o
Late Shri Someswar Rao.
With
reference to your letter dated NIL.
I
submit my Scrutiny Report as hereunder:-
1.
Name and address of the Mortgagor
Shri.
BAVK Mohan Rao
S/o
Late Shri Someswar Rao
R/o
1-1 290/3,
Vidyanager,
Hyderabad.
2.
Details/Description of documents scrutinized:
|
Sl.
No.
|
Date
|
Name
of the documents
|
Whether
Original/ Certified True Copy
|
|
1
|
12.05.2003
|
C.C.
Pahais for the year 1972-73 and 1978-79
|
Xerox
Copy
|
|
2
|
08.02.1980
|
Death
Certificate of Shri PV Narahari Rao
|
Xerox
Copy
|
|
3
|
07.03.1980
|
Legal
Heir Certificate of Shri PV Narahari Rao
|
Xerox
Copy
|
|
4
|
24.04.1980
|
C.C.
of Regd. GPA No. 58/80
|
Xerox
Copy
|
|
5
|
19.09.1980
|
Regd.
Sale Deed No. 1243/80 with Plan
|
Xerox
Copy
|
|
6
|
07.12.1998
|
Sanctioned
Plan vide proceeding No. 2155/98
|
Xerox
Copy
|
|
7
|
02.01.2003
|
Development
Agreement
|
Xerox
Copy
|
|
8
|
25.04.2003
|
EC
No. 6654/2003 for the period from 28.06.1980 to 31.03.1982
|
Xerox
Copy
|
|
9
|
25.04.2003
|
EC
No. 4136/2003 for the period from 01.04.1982 to 23.03.1984
|
Xerox
Copy
|
|
10
|
21.04.2003
|
EC
No. 3918/2003 for the period from 24.03.1994 to 20.04.2003
|
Xerox
Copy
|
|
11
|
28.07.2003
|
Agreement
for Sale
|
Original
|
3.
Details/Description of Property:-
|
Sl.No.
|
Sy.
No./H.No.
|
Extent
of land Location
|
Boundaries
|
Building
|
Dist.
|
Village
|
|
|
|
|
|
|
|
|
All
that Flat bearing No. F-5 on First Floor, admeasuring 900 sq. Ft, along with
undivided share of land 28 sq yds, out of total admeasuring 870 sq. yds
constructed on Plot Nos. 3, 4 and 5 in Sy. Nos. 84 and 85 in the premises of
"Guru Datta Nivas", situated at Nerdmet, Malkajagiri Municipality,
and Mandal, Ranga Reddy Dist. Hyderabad and bounded by:
|
FLAT
BOUNDARIES:
|
LAND
BOUNDARIES
|
|
NORTH:
Flat No. F-6
|
20-0"
|
|
SOUTH:
Open to sky
|
Wide
Road, Sy No. 86
|
|
EAST
: Corridor & Stair Case
|
Sy.
Nos. 76 and 78 .
|
|
WEST
: Open to sky
|
open
to sky
|
4.
Brief History of the Property and How the owner/Mortgagor has derived title:
The
Pahains for the years 1972-73 and 1978-79 under document No. 1 reveals that
Sri. Venkat Naraari Rao is the pattadar and possessor of the land admeasuring
Ac. 1-31 guntas in Sy No. 84 and Ac. 1-22 guntas in Sy No. 85 of Malkajgiri,
Hyderabad.
The
document No. 2 shows that Sri. PV Narahari Rao was expired on 23.01.1980 as per
the Death Certificate issued by MCH.
The
document No 3 shows that Smt. Saraswathi Bai is only the legal heir of Late
Shri PV Narahari Rao.
The
document No. 4 shows that Smt. Saraswathi Bai executed a GPA in favour of Sri.
CV Prasad Rao, empowering him to deal and sell the above said property.
The
GPA was registered in the office of sub- Registrar of Hyderabad-East vide
document No. 58/80 dated 24.04.1980.
The
document No. 5 shows that Smt. Saraswathi Bai sold the Plot Nos. 3, 4 and 5
admeasuring 870 sq yds. situated at Malkajgiri, Hyderabad to Smt. N. Samson
Sanjeeva Rao and executed a sale deed in his favour by virtue of document No.
1243/80 dated 19.09.1980 registered in the office of sub-registrar of Uppat,
Ranga Reddy.
The
document No. 6 shows that Shri N. Samson Sanjeeva Rao obtained permission from
Malkajgiri Municipality for construction of Residential building consisting of
Ground + 4 floors vide permit No. G1/2155/98 dated 07.12.1998.
The
document No. 7 shows that Shri N. Samson Sanjeeva Rao entered into development
agreement with Shri PY Kondal Rao for construction of residential flats in the
above said plots.
The
document Nos. 8, 9 and 10 are the Encumbrance Certificates for the period from
28.06.1998 to 20.04.2003 (23 years) which disclose only the transactions
mentioned in document No. 5.
The
document No. 11 shows that Shri N. Samson Sanjeeva Rao (owner) along with Shri
PY Kondal Rao (builder) agreed to sell the Schedule Property (referred under
Item No. III of this opinion) to Shri BAVK Mohan Rao (applicant) for a total
sale consideration of Rs. 5,50,000/- and Shri. BAVK Mohan Rao (applicant) also
agreed to purchase the said property for the same consideration.
5.
Search and Investigation.
|
5.1
|
The
person who is the present owner of the property
|
Shri
NS Sanjeeva Rao (present owner/vendor) and Shri BAVK Mohan Rao
(purchaser/Vendee)
|
|
5.2
to 5.5
|
xxx
|
xxx
|
|
5.6
|
Whether
there the latest title deed and immediately previous title deed(s) are
available in original
|
The
document No. 5 is available in Xerox (original verified)
|
|
5.7
to 5.13
|
xxx
|
xxx
|
|
5.14
|
Whether
the proposed equitable mortgage by deosit of title deed is possible? If so,
what are the documents to be deposited? If deposit is not possible, can there
be simple mortgage or a registered memorandum or by any other mode of
mortgage?
|
Yes,
Equitable mortgage is possible. The original registered Sale Deed executed in
favour of Shri BAVK Mohan Rao (applicant) by the Vendors along with all the
documents as mentioned in the list in Item No. 2 of this opinion should be
deposited.
|
|
5.15to
5.20
|
xxx
|
xxx
|
|
6-8
|
xxx
|
xxx
|
9.
CERTIFICATE
I
am of the opinion that Shri NS Sanjeeva Rao is having clear marketable title by
virtue of Regd. Sale Deed No. 1243/1980 dated 19.09.1980 referred document No.
5 of this opinion. He can convey a valid clear marketable title in favour of
Shri BAVK Mohan Rao (applicant) in respect of the schedule property (referred
under Item No. 3 of this opinion) by duly executing a Regd. Sale Deed in his
favour.
Shri
BAVK Mohan Rao (applicant) can create a valid equitable mortgage with the Bank
by depositing the original Regd. Sale deed executed in his by the vendors and
also depositing all the documents as mentioned in the list in Item No. 2 of
this opinion. I further certify that:-
|
1
|
There
are no prior mortgage/charge whatsoever as could be seen from the encumbrance
certificate for the period from 28.06.1980 to 20.04.2003 pertaining to the
immovable property covered by the above title deed(s).
|
Yes
|
|
2
|
There
are prior mortgages/charges to the extent, which are liable to be cleared or
satisfied by complying with the following.
|
NA
|
|
3
|
There
are claims from minors and his/her/their interest in the property to the
extent of (specify) the share of minor(s) with name
|
NA
|
|
4
|
The
undivided share of minor of (specify the liability that is fast ended or
could be fastened on the property).
|
NA
|
|
5
|
The
property is subject to the payment of Rupees (specify the liability that is
fastened or could be fastened on the property)
|
NA
|
|
6
|
Provisions
of Urban Land (Ceiling and Regulation) Act are not applicable. Permission
obtained.
|
NA
|
|
7
|
Holding/Acquisitions
in accordance with the provisions of the land:
|
NA
|
|
8
|
The
mortgage if created will be perfect and available to the bank for the
liability of the intending borrower: Shri BAVK Mohan Rao (Applicant)
|
NA
|
The
Bank is advised to obtain the encumbrance certificate for the period from
21.04.2003 till the date after obtaining a registered sale deed in favour of
Shri BAVK Mohan Rao (applicant)
SEARCH
REPORT: I have verified the title deed of Shri N.S. Sanjeeva Rao in the office
of sub-Registrar of Uppal, Hyderabad on 18.07.2003 and found that the sale
transaction between parties, schedule property stamp papers, regd. Sale Deed
No. 1243/1980 are genuine. The verification receipt is enclosed herewith.
(K.
NARAYANA RAO)
ADVOCATE"
The
above particulars show that the respondent herein, as a panel advocate,
verified the documents supplied by the Bank and rendered his opinion. It also
shows that he was furnished with Xerox copies of the documents and very few
original documents as well as Xerox copies of Death Certificate, Legal
heir-ship Certificate, Encumbrance Certificate for his perusal and opinion. It
is his definite claim that he perused those documents and only after that he
rendered his opinion. He also advised the bank to obtain Encumbrance
Certificate for the period from 21.04.2003 till date. It is pointed out that in
the same way, he furnished Legal Scrutiny Reports in respect of other cases
also.
18.
We have already mentioned that it is an admitted case of the prosecution that
his name was not mentioned in the FIR. Only in the charge-sheet, the respondent
has been shown as Accused No. 6 stating that he submitted false legal opinion
to the Bank in respect of the housing loans in the capacity of a panel advocate
and did not point out actual ownership of the properties in question.
19.
Mr. Venkataramani, learned senior counsel for the respondent submitted that in
support of charge under Section 120B, there is no factual foundation and no
evidence at all. Section 120A defines criminal conspiracy which reads thus:
"120A. Definition of criminal conspiracy.- When two or more persons agree
to do, or cause to be done,-
1)
an illegal act, or
2)
an act which is not illegal by illegal means, such an agreement is designated a
criminal conspiracy: Provided that no agreement except an agreement to commit
an offence shall amount to a criminal conspiracy unless some act besides the
agreement is done by one or more parties to such agreement in pursuance
thereof.
Explanation.-
It is immaterial whether the illegal act is the ultimate object of such
agreement, or is merely incidental to that object."Section 120B speaks
about punishment of criminal conspiracy. While considering the definition of
criminal conspiracy, it is relevant to refer Sections 34 and 35 of IPC which
are as under: "34. Acts done by several persons in furtherance of common
intention.- When a criminal act is done by several persons in furtherance of
the common intention of all, each of such persons is liable for that act in the
same manner as if it were done by him alone." "35. When such an act
is criminal by reason of its being done with a criminal knowledge or intention.
- Whenever an act, which is criminal only by reason of its being done with a
criminal knowledge or intention, is done by several persons, each of such
persons who joins in the act with such knowledge or intention is liable for the
act in the same manner as if the act were done by him alone with that knowledge
or intention.
20.
"The ingredients of the offence of criminal conspiracy are that there
should be an agreement between the persons who are alleged to conspire and the
said agreement should be for doing of an illegal act or for doing, by illegal
means, an act which by itself may not be illegal. In other words, the essence
of criminal conspiracy is an agreement to do an illegal act and such an
agreement can be proved either by direct evidence or by circumstantial evidence
or by both and in a matter of common experience that direct evidence to prove
conspiracy is rarely available. Accordingly, the circumstances proved before
and after the occurrence have to be considered to decide about the complicity
of the accused. Even if some acts are proved to have committed, it must be
clear that they were so committed in pursuance of an agreement made between the
accused persons who were parties to the alleged conspiracy. Inferences from
such proved circumstances regarding the guilt may be drawn only when such
circumstances are incapable of any other reasonable explanation. In other
words, an offence of conspiracy cannot be deemed to have been established on
mere suspicion and surmises or inference which are not supported by cogent and
acceptable evidence.
21.
In the earlier part of our order, first we have noted that the respondent was
not named in the FIR and then we extracted the relevant portions from the
charge-sheet about his alleged role. Though statements of several witnesses
have been enclosed along with the charge-sheet, they speak volumes about others.
However, there is no specific reference to the role of the present respondent
along with the main conspirators.
22.
The High Court while quashing the criminal proceedings in respect of the
respondent herein has gone into the allegations in the charge sheet and the
materials placed for his scrutiny and arrived at a conclusion that the same
does not disclose any criminal offence committed by him. It also concluded that
there is no material to show that the respondent herein joined hands with A-1
to A-3 for giving false opinion. In the absence of direct material, he cannot
be implicated as one of the conspirators of the offence punishable under
Section 420 read with Section 109 of IPC. The High Court has also opined that
even after critically examining the entire material, it does not disclose any
criminal offence committed by him. Though as pointed out earlier, a roving
enquiry is not needed, however, it is the duty of the Court to find out whether
any prima facie material available against the person who has charged with an
offence under Section 420 read with Section 109 of IPC. In the banking sector
in particular, rendering of legal opinion for granting of loans has become an
important component of an advocate's work. In the law of negligence,
professionals such as lawyers, doctors, architects and others are included in
the category of persons professing some special skills.
23.
A lawyer does not tell his client that he shall win the case in all
circumstances. Likewise a physician would not assure the patient of full
recovery in every case. A surgeon cannot and does not guarantee that the result
of surgery would invariably be beneficial, much less to the extent of 100% for
the person operated on. The only assurance which such a professional can give
or can be given by implication is that he is possessed of the requisite skill
in that branch of profession which he is practising and while undertaking the
performance of the task entrusted to him, he would be exercising his skill with
reasonable competence. This is what the person approaching the professional can
expect. Judged by this standard, a professional may be held liable for
negligence on one of the two findings, viz., either he was not possessed of the
requisite skill which he professed to have possessed, or, he did not exercise,
with reasonable competence in the given case, the skill which he did possess.
24.
In Jacob Mathew vs. State of Punjab & Anr. (2005) 6 SCC 1 this court laid
down the standard to be applied for judging. To determine whether the person
charged has been negligent or not, he has to be judged like an ordinary
competent person exercising ordinary skill in that profession. It is not
necessary for every professional to possess the highest level of expertise in
that branch which he practices.
25.
In Pandurang Dattatraya Khandekar vs. Bar Council of Maharashtra & Ors.
(1984) 2 SCC 556, this Court held that "there is a world of difference
between the giving of improper legal advice and the giving of wrong legal
advice. Mere negligence unaccompanied by any moral delinquency on the part of a
legal practitioner in the exercise of his profession does not amount to
professional misconduct.
26.
Therefore, the liability against an opining advocate arises only when the
lawyer was an active participant in a plan to defraud the Bank. In the given
case, there is no evidence to prove that A-6 was abetting or aiding the
original conspirators.
27.
However, it is beyond doubt that a lawyer owes an "unremitting
loyalty" to the interests of the client and it is the lawyer's
responsibility to act in a manner that would best advance the interest of the
client. Merely because his opinion may not be acceptable, he cannot be mulcted
with the criminal prosecution, particularly, in the absence of tangible
evidence that he associated with other conspirators. At the most, he may be
liable for gross negligence or professional misconduct if it is established by
acceptable evidence and cannot be charged for the offence under Sections 420
and 109 of IPC along with other conspirators without proper and acceptable link
between them. It is further made clear that if there is a link or evidence to
connect him with the other conspirators for causing loss to the institution,
undoubtedly, the prosecuting authorities are entitled to proceed under criminal
prosecution. Such tangible materials are lacking in the case of the respondent
herein.
28.
In the light of the above discussion and after analysing all the materials, we
are satisfied that there is no prima facie case for proceeding in respect of
the charges alleged insofar as respondent here in is concerned. We agree with
the conclusion of the High Court in quashing the criminal proceedings and
reject the stand taken by the CBI.29) In the light of what is stated above, the
appeal fails and the same is dismissed.
...........................J.
(P. SATHASIVAM)
...........................J.
(RANJAN GOGOI)
NEW
DELHI;
SEPTEMBER
21, 2012
References /Courtesy :
http://www.advocatekhoj.com/library/judgments/announcement.php?WID=2560
