Manappuram Finance Ltd vs The State Of Karnataka
2025 Latest Caselaw 2147 Kant

Karnataka High Court

Manappuram Finance Ltd vs The State Of Karnataka on 9 January, 2025

Author: M.Nagaprasanna

Bench: M.Nagaprasanna

                                                          -1-
                                                                      NC: 2025:KHC-D:322
                                                                  WP No. 100108 of 2025




                                          IN THE HIGH COURT OF KARNATAKA,
                                                  DHARWAD BENCH

                                      DATED THIS THE 9TH DAY OF JANUARY, 2025

                                                      BEFORE
                                     THE HON'BLE MR. JUSTICE M.NAGAPRASANNA

                                    WRIT PETITION NO.100108 OF 2025 (GM-POLICE)

                             BETWEEN:

                             MANAPPURAM FINANCE LTD.,
                             A COMPANY INCORPORATED UNDER
                             THE COMPANIES ACT 1956
                             HAVING REGISTERED OFFICE AT MANAPPURAM HOUSE,
                             A.O.VALAPAD, TRISSUR DISTRICT, KERALA - 680 567,
                             HAVING ONE OF ITS BRANCH At KESHAVAPURA
                             REP BY AUTHORIZED SIGNATORY,
                             AND LEGAL MANAGER, MR. PRASATH S.
                                                                              ...PETITIONER
                             (BY SRI GIRISH V. BHAT, ADVOCATE)

                             AND:

                             1.   THE STATE OF KARNATAKA,
                                  BY ITS SECRETARY, HOME DEPARTMENT,
                                  VIDHANA SOUDHA, BENGALURU - 560 001.
                             2.   THE SUPERINTENDENT OF POLICE,
VISHAL
NINGAPPA                          MAGADI, RAMANAGARA DISTRICT,
PATTIHAL                          KARNATAKA - 562 120.
Digitally signed by VISHAL
NINGAPPA PATTIHAL
Location: High Court of
Karnataka Dharwad
Date: 2025.01.18 11:02:11
                             3.   THE POLICE INSPECTOR,
+0530
                                  KADURU P. S., TQ: MAGADI,
                                  RAMANAGARA DISTRICT,
                                  KARNATAKA - 562 120.
                                                                         ...RESPONDENTS
                             (BY SRI SHARADA V. MAGADUM, AGA FOR R1 TO R3)

                                   THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
                             OF THE CONSTITUTION OF INDIA, PRAYING TO, QUASH THE NOTICE
                             IN BEARING NO/E5/P.S/R.D/MO.NO/366/2024 DATED 30.12.2024
                             ISSUED U/S 94 OF THE BNSS ADDRESSED TO MANAPPURAM
                             FINANCE LIMITED, THE PETITIONER HEREIN, BY THE RESPONDENT
                             NO.3, FURNISHED AS ANNEXURE-G. ISSUE A DIRECTION IN THE
                             NATURE OF MANDAMUS OR ORDER OR DIRECTION DIRECTING THE
                                    -2-
                                                  NC: 2025:KHC-D:322
                                            WP No. 100108 of 2025




RESPONDENT NO.3 NOT TO TAKE ANY COERCIVE ACTION AGAINST
THE PETITIONER BANK AND ITS OFFICERS IN PURSUANT TO NOTICE
IN BEARING NO/E5/P.S/R.D/MO.NO/366/2024 DATED 30.12.2024
FURNISHED AS ANNEXURE-G AND ETC.,

     THIS WRIT PETITION, COMING ON FOR PRELIMINARY
HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:


                             ORAL ORDER

(PER: THE HON'BLE MR. JUSTICE M.NAGAPRASANNA)

1. The petitioner is before this Court seeking the

following prayer:

"I. To quash the notice in Bearing no/E5/P.S/R.D/Mo.No/366/ 2024 dated 30.12.2024 issued U/s 94 of the BNSS addressed to Manappuram Finance Limited, the Petitioner herein, by the Respondent No.3, furnished as Annexure-G.

II. Issue a direction in the nature of mandamus or order or direction directing the Respondent no.3 not to take any coercive action against the petitioner bank and its officers in pursuant to notice in bearing no/E5/P.S/R.D/Mo.No/366/2024 dated 30.12.2024 furnished as Annexure-G.

III. And grant such other relief or directions as this Hon'ble Court deems fit the facts and circumstances of the case."

2. Learned counsel for the petitioner and the State

in unison submit that the issue stands answered by the

judgment of the Coordinate Bench in W.P.No.36201/2024

disposed of on 31.12.2024. The Coordinate Bench has held

as follows:

NC: 2025:KHC-D:322

"1. The petitioner is before this Court seeking for the following reliefs:

a) Declare that the interference by the Respondents in petitioners business for forcefully seizing the gold articles pledged by it costumers is arbitrary and is in violation of fundamental rights guaranteed under articles 14 and 19(1)(g) of the constitution of India in the interest of justice and equity.

b) Issue a writ of mandamus or any other appropriate writ, order or direction to be issued to the Respondents to not seize the gold articles from the petitioner but can only examine the same by summoning it for the purpose of investigation in Crime No. 414/2024 registered by th R2, in the interest of justice and equity.

c) Issue a writ of certiorari for call for the records of the Annexure-C notices issued by the R2 to the petitioner dated 30.12.2024 and quash the same and all consequential actions taken against the petitioner thereafter, interest of justice and equity.

d) And grant such other relief or directions as this Hon'ble Court deems fit the facts and circumstances of the case.

2. Learned AGA is directed to accept notice for respondents No.1 and 2.

3. The order being challenged is a notice issued by respondent No.2 - Station House Officer to make

NC: 2025:KHC-D:322

available certain gold articles said to be in the custody of the Petitioner which are claimed to have been stolen and pledged with the petitioner.

4. Sri.Anish Jose Antony, learned counsel for the petitioner would submit that the petitioner would cooperate with the investigation but would have to retain the gold which had been pledged with the petitioner since the petitioner has a right over the same being a Pledgee/pawnee.

5. He submits that there is a right vested with the petitioner on account of the pledge of the said gold as a security and that security cannot be taken away on the ground that the gold is stolen, the ownership of the gold would have to be established by the person claiming it by way of an appropriately instituted civil suit.

6. Having considered the above submission and having perused the papers, I'am of the considered opinion that the petitioner being only a pledgee/ pawnee would have a only right that the pledgers/pawner has in the said gold and the petitioner cannot claim any right more than that.

7. During investigation, the Investigating Officer would be required to ascertain various aspects including the ownership of the said gold and it is for the Court seized of the matter to decide as to in whose favour the gold has to be returned, if an application under Section 454 of the earlier Code of Criminal Procedure and now Section 500 of the BNSS were to be filed. Of course, at that time the petitioner can always place its rights and

NC: 2025:KHC-D:322

claims before the said Court for being decided. The true owner of the gold cannot be deprived of the use of the gold, merely because the same is pledged with a gold finance company after being stolen from such true owner. The Gold Finance Company is vested with a duty to carry out properdue diligence before accepting the gold as a pledge for a loan disbursed.

8. There are innumerable matters coming up before this court where stolen gold is pledged with a gold finance company. I'am of the considered opinion that this aspect would have to be examined by the concerned authorities and proper guidelines have to be formulated in relation to such pledging of gold, ascertainment of ownership, identity of the person pledging the gold, implication of pledging stolen gold, manner of dealing with such gold when criminal proceedings are taken up etc., etc.,. Therefore, I request the Law Commission, Karnataka to look into this matter and formulate necessary guidelines/rules or the like as deemed fit

9. In that view of the matter, directing the petitioner to co-operate with the Investigating Officer and make available all the details relating to the pledge as also permit the inspection of the gold, which if required the Investigation Officer can take receipt of anddeposit with the Court seized of the matter, on coming to the conclusion that the said gold is stolen, it is made clear that the police officer cannot retain the gold in his possession, but would have to deposit the same with the court seized of the matter. The court seized of the matter while considering any application for release

NC: 2025:KHC-D:322

of the gold or at the time when the court were to pass an order of release for any reason whatsoever, would have to issue notice to the Petitioner and afford an opportunity of hearing to the petitioner before ordering the release. With the above observations, the writ petition stands disposed of

10. Registrar (Judicial) is directed to forward a copy of this order to the Chairman, Karnataka Law Commission."

3. In the light of the issue standing answered by

the Coordinate Bench as quoted hereinabove, the petition

stands disposed on the same terms as quoted (supra).

Sd/-

(M.NAGAPRASANNA) JUDGE

KGK/CT-ASC