Case Note & Summary
The High Court of Karnataka, Dharwad Bench, heard four writ petitions together filed by Manappuram Finance Limited and Muthoot Finance Limited, both non-banking financial companies (NBFCs) engaged in gold loan business under Reserve Bank of India license. The petitions were filed under Articles 226 and 227 of the Constitution, challenging notices issued by investigating officers under Section 91 of the Code of Criminal Procedure, 1973 or Section 94 of the Bharatiya Nagarik Suraksha Sanhita, 2023. These notices called upon the petitioner companies to produce gold ornaments that had been pledged by individuals accused in robbery or theft cases. The police had registered FIRs for offences under Section 309(4) of the Bharatiya Nyaya Sanhita, 2023, based on complaints alleging that gold chains, bracelets, and other ornaments were forcibly snatched or stolen. Upon arrest, the accused persons allegedly confessed to having pledged the stolen articles with the petitioner NBFCs in multiple transactions. The investigating officers sought production of the pledged gold to facilitate recovery and investigation. The petitioners contended that the police have no authority to seize the gold articles from them and that the notices amounted to coercive action beyond the scope of Section 91 CrPC/94 BNSS, which only permits summoning of documents or things for examination. They argued that they were bona fide lenders acting in compliance with banking norms and RBI regulations, and that the transactions were at arm's length. They relied on earlier orders of the Karnataka High Court in cases such as W.P.No.100269/2024, W.P.No.103829/2024, W.P.No.10754/2023, and W.P.No.22441/2022, where the court had directed the police not to take coercive steps and to only summon documents for verification. In one of the petitions, the petitioners also sought a declaration that the police interference was arbitrary and violative of their fundamental rights under Articles 14 and 19(1)(g) of the Constitution. The respondent State and police authorities filed statements of objections, asserting that the accused were habitual offenders involved in multiple cases, and that recovery of the stolen property was essential for completing the investigation and submitting a final report. They stated that the investigating officer had statutory power to secure material objects and that the petitioners had refused to co-operate. It was also brought to the court's notice that the petitioners had earlier approached the Division Bench in W.A.No.100363/2024 and had obtained interim protection, but the present petitions sought quashing of the notices altogether. The court heard the counsel for the petitioners and the Additional Government Advocate for the respondents, examined the factual matrices, and considered the legal contentions. The judgment text provided, however, ends before the court’s final reasoning and operative directions, and therefore the ultimate decision and ratio decidendi are not ascertainable from the available excerpt.
Headnote
A) Criminal Procedure - Investigation - Section 91 Code of Criminal Procedure, 1973; Section 94 Bharatiya Nagarik Suraksha Sanhita, 2023 - Police notices to NBFCs to produce gold articles pledged by accused in robbery cases - Petitioners contended that police can only summon for examination, not seize, relying on previous High Court orders directing no coercive steps - The State argued that recovery of stolen property is essential and the investigation officer has power to secure material objects - Court examined the contentions (Paras 1-12). B) Constitutional Law - Fundamental Rights - Articles 14, 19(1)(g) of the Constitution of India - Arbitrary police interference in business - Petitioners sought declaration that police action in summoning/seizing gold articles violated their right to equality and freedom of trade - Court considered the balance between investigation needs and business rights (Paras 3, 8).
Issue of Consideration
Whether investigating officers can issue notices under Section 91 CrPC or Section 94 BNSS to NBFCs for production of gold articles pledged by accused in criminal cases, and whether such notices amount to coercive seizure violating fundamental rights
Law Points
- police power to compel production of material objects from third parties under Section 91 CrPC and Section 94 BNSS
- distinction between summoning and seizure
- rights of bonafide NBFC licensees under RBI
- fundamental rights under Articles 14 and 19(1)(g) against arbitrary police interference
- reliance on earlier High Court orders directing no coercive action
