CBI court convicts two persons to 5 years’ rigorous imprisonment

The Judge also ordered them to pay a total fine of ₹11,000 each

First Additional Special Judge for CBI cases, Visakhapatnam, C.N. Murthy, on Monday convicted Menda Venkatara Ramana Murthy (A3), managing director of Sri Lakshmi Swarnandhra Paper Mills Private Limited, Dowleswaram and Chinimille Surya Prabhakara Rao (A5), proprietor of Sri Sai Paper Equipment and Spares, Konthamuru and sentenced them to undergo five years rigorous imprisonment and pay a total fine of ₹11,000 each.

It was alleged that Sri Lakshmi Swarnandhra Paper Mills Private Limited (A2), represented by Menda Venkata Ramana Murthy (A3) and Girijala Venkata Surya Prabhakara Rao (A4), director of Sri Lakshmi Swarnandhra Paper Mills Private Limited and Shri Chinimille Surya Prabhakar Rao (A5) had dishonestly misrepresented the facts and cheated the Syndicate Bank in the matter of sanction of a term loan amounting to ₹6 crore.

In pursuance of the said criminal conspiracy, A4 obtained C.A. certificates to the extent that the company Sri Lakshmi Swarnandhra Paper Mills Private Limited (A2) had infused the margin money required to be spent by the company and availed the sanctioned term loan of ₹6 crore without infusing the margin money into the account.

Meanwhile, Durvasala Satya Siva Rama Sharma (A1), the then branch manager of Syndicate Bank, Rajahmundry, abused his official position and blatantly flouted the norms and also the terms and conditions stipulated in the sanction letter, and had released the sanctioned term loans without ensuring requisite margin money.

Durvasala Satya Siva Rama Sharma also allowed to disburse the loan amount to the account of the supplier of machinery, Chinimille Surya Prabhakar Rao (A5), and failed to ensure the supply of machinery for installation of 30 TPD capacity paper mill.

In pursuance of the said criminal conspiracy, the company Sri Lakshmi Swarnandhra Paper Mills Private Limited (A2) and its directors Manda Venkata Ramana Murthy (A3) and Girijala Venkata Surya Prabhakara Rao (A4) diverted the funds given in connivance with Sri Sai Paper Equipment and Spares, represented by Chinimille Surya Prabhakara Rao (A5).

Thereby, A1 had failed to ensure end utilisation of the term loan proceeds and failed to obtain final invoice/bill from the vendor Sri Sai Paper Equipment and Spares. Following which, A1 by releasing the term loan phase wise, without observing the stipulated terms and conditions and thereby accused, caused wrongful loss to the bank to the tune of ₹9,88,12,136.12 as of October 2013, and corresponding wrongful gain to themselves.

After completion of trial, court convicted the above mentioned accused for the offences U/Ss.420, 120-B and amp; 406 IPC. During trial proceedings, Durvasula Satya Siva Rama Sarma (A1), died on May 27, 2019, and the case against him was abated on July 4, 2019, by the court.