Negligence in a legal opinion may invite disciplinary action, but not a criminal case: the Patna High Court has quashed a bank-fraud prosecution against a UCO Bank panel lawyer on that footing.
Patna: A lawyer empanelled with UCO Bank, named in a loan fraud case over allegedly forged property documents offered as collateral, will not face trial, the Patna High Court has ruled, holding that an advocate cannot be criminally prosecuted merely because a legal opinion given in the course of professional duties later proves incorrect [Gopal Krishna Agrawal v. State of Bihar and Another].
The petition under Section 482 of the Code of Criminal Procedure was decided by Justice Rana Vikram Singh. Advocates Siddhartha Prasad, Om Prakash Kumar and Shashank Shekhar appeared for the petitioner, Additional Public Prosecutor Sanjay Kumar Tiwary for the State, and Advocate Rajesh Kumar Pandey for UCO Bank.
Where negligence ends and crime begins
Careless advice, given without verifying the facts, can expose a lawyer to disciplinary action, the Court said. Criminal liability is another matter altogether. In its view, an advocate can never be penalised for tendering an opinion simply because it turned out to be wrong, though liability can arise where an advocate deliberately gives a false and misleading opinion to facilitate a fraud, which may amount to conspiracy and cheating.
Tested against that line, the case fell short. The Court found the essential ingredients of criminal breach of trust under Sections 406 and 409 missing, as there was no entrustment and no dishonest misappropriation by the advocate. Cheating under Section 420 was also not made out, since nothing showed that he dishonestly induced delivery of property or valuable security. The FIR carried no allegation of illegal gratification or collusion by him, the Court noted, and a client remains free to accept, reject or ignore legal advice. It described the proceedings as malicious and vexatious.
The FIR and the two opinions
The petitioner, who has practised for over 35 years, gave legal opinions on two borrowers in 2002 and 2003. In December 2008, the Chief Manager of UCO Bank’s Exhibition Road Branch, Patna, lodged a complaint about irregularities in sanctioning and disbursing cash-credit facilities, and an FIR followed. On January 21, 2016, the Additional Chief Judicial Magistrate, Patna, took cognizance under Sections 406, 409, 420, 467, 468, 471 and 120B of the Indian Penal Code.
The case, which is untested, alleges that bank officials colluded with borrowers and guarantors in sanctioning loans against collateral properties, that the accounts later became non-performing assets and caused the bank a loss, and that the title documents were forged or fabricated. The petitioner’s opinions had supported title.
His answer was that he had advised the bank to verify the original documents independently, and that the decision to sanction the loans lay with bank officials.
Quashed for him alone
The petition was allowed. The cognizance order of January 21, 2016 stands quashed so far as the petitioner is concerned, and all consequential criminal proceedings against him are set aside. Any other accused is unaffected by the order, and the Court has made no finding on the allegations against them.
Case Title: Gopal Krishna Agrawal v. State of Bihar and Another [Criminal Miscellaneous No. 50456 of 2016]
Bench: Justice Rana Vikram Singh, Patna High Court
Appearances: Advocates Siddhartha Prasad, Om Prakash Kumar and Shashank Shekhar for the petitioner; Additional Public Prosecutor Sanjay Kumar Tiwary for the State; Advocate Rajesh Kumar Pandey for UCO Bank.