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Andhra Pradesh High Court – Amravati
Manappuram General Finance And Leasing … vs The State Of Andhra Pradesh on 30 August, 2025
APHC010494382023
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3457]
(Special Original Jurisdiction)
SATURDAY,THE THIRTIETH DAY OF AUGUST
TWO THOUSAND AND TWENTY FIVE
PRESENT
THE HONOURABLE SRI JUSTICE HARINATH.N
WRIT PETITION Nos.25540, 26267, 3584, 13928, 13944, 16467, 23417,
28721, 28888 of 2023, 8621, 9480, 9648, 10424, 14279, 17065, 23656,
23757, 24620, 25826, 26080 of 2024
WP.No. 25540 OF 2023
Between:
1. MANAPPURAM ASSET FINANCE LIMITED, HAVING ITS
REGISTERED OFFICE AT IV 1470 (OLD) W638A (NEW),
MANAPPURAM HOUSE VALAPAD, THRISSUR, KERALA, INDIA - 680
567 AND ITS BRANCH AT BUILDING NO.1 - 49 - 126, VZM ROAD,
BANGALAMETTA, TAGARAPUVALASA, VISHAKAPATNAM, ANDHRA
PRADESH REPRESENTED THROUGH ITS AUTHORIZED
SIGNATORY
...PETITIONER
AND
1. THE STATE OF AP, REP BY ITS PRINCIPAL SECRETARY, HOME
DEPARTMENT, SECRETARIAT BUILDINGS, AMARAVATHI.
2. THE CITY COMMISSIONER, OFFICE OF THE COMMISSIONER OF
POLICE, SURYABAGH, BESIDE VYSHAKIJALAUJYANAVA.NAM,
VISHAKHAPATNAM DISTRICT, AP.
3. THE STATION HOUSE OFFICER, BHIMUNIPATNAM POLICE
STATION, VISHAKHAPATNAM DISTRICT, AP.
4. NERALLA GOPINATH, S/O N APPANNA, AGED ABOUT 44 YEARS,
OCC. TERRITORY MANAGER, RIO F.NO. 101, KALYAN KRISHNA
RESIDENCY 2, SANGIVALASA, TAGARAPUVALASA,
BHEEMUNIPATNAM MANDAL, VISHAKHAPATNAM DISTRICT, AP.
5. KOSANA VENKATA RAMANA, S/O SURI REDDY, AGED ABOUT 36
YEARS, OCC. ASST. BRANCH MANAGER, IIFL GOLD LOAN BANK,
TAGARAPUVALASA, R/O D.NO 8-65-102/2, CHILLAPETA VILLAGE,
BHEEMILI MANDAL, VISHAKHAPATNAM DISTRICT, AP.
6. KORADA VENKATA GIREESH, S/O KORADAAPPAYYAMMA, AGED
ABOUT 28 YEARS, D.NO. 3-61, T NAGARAPALEM,
VISHAKHAPATNAM DISTRICT, AP.
7. MUNAKALAKURNAKAR REDDY, S/O RAMAKRISHNSA, AGED
ABOUT 32 YEARS, R.NO. 8-63-43/1, CHILLAPETA, CHITTIVALASA,
BHEEMUNIPATNAM VISHAKHAPATNAM DISTRICT, AP.
8. VIJJAPU SAI, , S/O CHINNAVENKATA RAMANA, AGED ABOUT 23
//2//
WP.No.25540 of 2023& batch
YEARS, R.NOGOLLALATALLVALASA, BHEEMUNIPATNAM,
VISHAKHAPATNAM DISTRICT, AP.
9. CHILLATRINADH, R.OD.NO. 8-63-1, CHILLAPETA,
BHEEMUNIPATNAM, VISHAKHAPATNAM DISTRICT, AP.
10. SINGARAPU ADI VENKATARAMANA, .S/O SATYANARAYANA,
AGED ABOUT 29 YEARS, R.NO. D.NO. 8-57-20/1 , SANTHAPET ,
GOLLAVEEDI , CHITTIVALASA, BHEEMUNIPATNAM,
VISHAKHAPATNAM DISTRICT, AP.
...RESPONDENT(S):
Counsel for the Petitioner:
1. V NITESH
Counsel for the Respondent(S):
1. GP FOR HOME
2. T SREEDHAR
The Court made the following:
<Gist:
>Head Note:
? Cases referred:
1. 2016 SCC OnLine Ker41332
2. SLP (CRL.)9539 of 2023
This Court made the following :
//3//
WP.No.25540 of 2023& batch
APHC010494382023
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3457]
(Special Original Jurisdiction)
SATURDAY,THE THIRTIETH DAY OF AUGUST
TWO THOUSAND AND TWENTY FIVE
PRESENT
THE HONOURABLE SRI JUSTICE HARINATH.N
WRIT PETITION Nos.25540, 26267, 3584, 13928, 13944, 16467, 23417,
28721, 28888 of 2023, 8621, 9480, 9648, 10424, 14279, 17065, 23656,
23757, 24620, 25826, 26080 of 2024
WP.No. 25540 OF 2023
Between:
1. MANAPPURAM ASSET FINANCE LIMITED, HAVING ITS
REGISTERED OFFICE AT IV 1470 (OLD) W638A (NEW),
MANAPPURAM HOUSE VALAPAD, THRISSUR, KERALA, INDIA - 680
567 AND ITS BRANCH AT BUILDING NO.1 - 49 - 126, VZM ROAD,
BANGALAMETTA, TAGARAPUVALASA, VISHAKAPATNAM, ANDHRA
PRADESH REPRESENTED THROUGH ITS AUTHORIZED
SIGNATORY
...PETITIONER
AND
1. THE STATE OF AP, REP BY ITS PRINCIPAL SECRETARY, HOME
DEPARTMENT, SECRETARIAT BUILDINGS, AMARAVATHI.
2. THE CITY COMMISSIONER, OFFICE OF THE COMMISSIONER OF
POLICE, SURYABAGH, BESIDE VYSHAKIJALAUJYANAVA.NAM,
VISHAKHAPATNAM DISTRICT, AP.
3. THE STATION HOUSE OFFICER, BHIMUNIPATNAM POLICE
STATION, VISHAKHAPATNAM DISTRICT, AP.
4. NERALLA GOPINATH, S/O N APPANNA, AGED ABOUT 44 YEARS,
OCC. TERRITORY MANAGER, RIO F.NO. 101, KALYAN KRISHNA
RESIDENCY 2, SANGIVALASA, TAGARAPUVALASA,
BHEEMUNIPATNAM MANDAL, VISHAKHAPATNAM DISTRICT, AP.
5. KOSANA VENKATA RAMANA, S/O SURI REDDY, AGED ABOUT 36
YEARS, OCC. ASST. BRANCH MANAGER, IIFL GOLD LOAN BANK,
TAGARAPUVALASA, R/O D.NO 8-65-102/2, CHILLAPETA VILLAGE,
BHEEMILI MANDAL, VISHAKHAPATNAM DISTRICT, AP.
6. KORADA VENKATA GIREESH, S/O KORADAAPPAYYAMMA, AGED
ABOUT 28 YEARS, D.NO. 3-61, T NAGARAPALEM,
VISHAKHAPATNAM DISTRICT, AP.
7. MUNAKALAKURNAKAR REDDY, S/O RAMAKRISHNSA, AGED
ABOUT 32 YEARS, R.NO. 8-63-43/1, CHILLAPETA, CHITTIVALASA,
BHEEMUNIPATNAM VISHAKHAPATNAM DISTRICT, AP.
8. VIJJAPU SAI, , S/O CHINNAVENKATA RAMANA, AGED ABOUT 23
//4//
WP.No.25540 of 2023& batch
YEARS, R.NOGOLLALATALLVALASA, BHEEMUNIPATNAM,
VISHAKHAPATNAM DISTRICT, AP.
9. CHILLATRINADH, R.OD.NO. 8-63-1, CHILLAPETA,
BHEEMUNIPATNAM, VISHAKHAPATNAM DISTRICT, AP.
10. SINGARAPU ADI VENKATARAMANA, .S/O SATYANARAYANA,
AGED ABOUT 29 YEARS, R.NO. D.NO. 8-57-20/1 , SANTHAPET ,
GOLLAVEEDI , CHITTIVALASA, BHEEMUNIPATNAM,
VISHAKHAPATNAM DISTRICT, AP.
...RESPONDENT(S):
DATE OF COMMON ORDER PRONOUNCED: 30.08.2025
SUBMITTED FOR APPROVAL:
HON'BLE SRI JUSTICE HARINATH.N
1. Whether Reporters of Local newspapers may
be allowed to see the Judgments? Yes/No
2. Whether the copies of order may be marked
to Law Reporters/Journals? Yes/No
3. Whether Your Lordships wish to see the fair
copy of the order?
Yes/No
____________________
JUSTICE HARINATH.N
//5//
WP.No.25540 of 2023& batch
APHC010494382023
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3457]
(Special Original Jurisdiction)
SATURDAY,THE THIRTIETH DAY OF AUGUST
TWO THOUSAND AND TWENTY FIVE
PRESENT
THE HONOURABLE SRI JUSTICE HARINATH.N
WRIT PETITION Nos.25540, 26267, 3584, 13928, 13944, 16467, 23417,
28721, 28888 of 2023, 8621, 9480, 9648, 10424, 14279, 17065, 23656,
23757, 24620, 25826, 26080 of 2024
WP.No. 25540 OF 2023
Between:
1. MANAPPURAM ASSET FINANCE LIMITED, HAVING ITS
REGISTERED OFFICE AT IV 1470 (OLD) W638A (NEW),
MANAPPURAM HOUSE VALAPAD, THRISSUR, KERALA, INDIA - 680
567 AND ITS BRANCH AT BUILDING NO.1 - 49 - 126, VZM ROAD,
BANGALAMETTA, TAGARAPUVALASA, VISHAKAPATNAM, ANDHRA
PRADESH REPRESENTED THROUGH ITS AUTHORIZED
SIGNATORY
...PETITIONER
AND
1. THE STATE OF AP, REP BY ITS PRINCIPAL SECRETARY, HOME
DEPARTMENT, SECRETARIAT BUILDINGS, AMARAVATHI.
2. THE CITY COMMISSIONER, OFFICE OF THE COMMISSIONER OF
POLICE, SURYABAGH, BESIDE VYSHAKIJALAUJYANAVA.NAM,
VISHAKHAPATNAM DISTRICT, AP.
3. THE STATION HOUSE OFFICER, BHIMUNIPATNAM POLICE
STATION, VISHAKHAPATNAM DISTRICT, AP.
4. NERALLA GOPINATH, S/O N APPANNA, AGED ABOUT 44 YEARS,
OCC. TERRITORY MANAGER, RIO F.NO. 101, KALYAN KRISHNA
RESIDENCY 2, SANGIVALASA, TAGARAPUVALASA,
BHEEMUNIPATNAM MANDAL, VISHAKHAPATNAM DISTRICT, AP.
5. KOSANA VENKATA RAMANA, S/O SURI REDDY, AGED ABOUT 36
YEARS, OCC. ASST. BRANCH MANAGER, IIFL GOLD LOAN BANK,
TAGARAPUVALASA, R/O D.NO 8-65-102/2, CHILLAPETA VILLAGE,
BHEEMILI MANDAL, VISHAKHAPATNAM DISTRICT, AP.
6. KORADA VENKATA GIREESH, S/O KORADAAPPAYYAMMA, AGED
ABOUT 28 YEARS, D.NO. 3-61, T NAGARAPALEM,
VISHAKHAPATNAM DISTRICT, AP.
7. MUNAKALAKURNAKAR REDDY, S/O RAMAKRISHNSA, AGED
ABOUT 32 YEARS, R.NO. 8-63-43/1, CHILLAPETA, CHITTIVALASA,
BHEEMUNIPATNAM VISHAKHAPATNAM DISTRICT, AP.
8. VIJJAPU SAI, , S/O CHINNAVENKATA RAMANA, AGED ABOUT 23
//6//
WP.No.25540 of 2023& batch
YEARS, R.NOGOLLALATALLVALASA, BHEEMUNIPATNAM,
VISHAKHAPATNAM DISTRICT, AP.
9. CHILLATRINADH, R.OD.NO. 8-63-1, CHILLAPETA,
BHEEMUNIPATNAM, VISHAKHAPATNAM DISTRICT, AP.
10. SINGARAPU ADI VENKATARAMANA, .S/O SATYANARAYANA,
AGED ABOUT 29 YEARS, R.NO. D.NO. 8-57-20/1 , SANTHAPET ,
GOLLAVEEDI , CHITTIVALASA, BHEEMUNIPATNAM,
VISHAKHAPATNAM DISTRICT, AP.
...RESPONDENT(S):
Petition under Article 226 of the Constitution of India praying that in the
circumstances stated in the affidavit filed therewith, the High Court may be
pleased topleased to issue an appropriate Writ, order or direction, particularly
in the nature of a Writ of Mandamus, by declaring the notice issued by
Respondent No.3 U/s 91of Cr.P.C, dt25-09-2023 issued against the branch of
Petitioner Company (Impugned Notice) and consequently extending threats to
the employees of the Petitioner Company to hand over the pledged gold
ornaments in respect of loan amounts sanctioned to the Respondent No.6 to
10 without discharging the loan amounts under the guise of registration of Cr.
No. 253 of 2023 in Bheemunipatnam Police Station, Vishakhapatnam
Commissionerate for the offences under Section 420,409 IPC on 23-09-2023
and interference with the day to day business activities of the Petitioner
Company without following due process of law as illegal, arbitrary and
contrary to the law and consequently set aside the impugned notice dt25-09-
2023 and further direct the Respondents herein especially the Respondent
no.3 not to interfere with the business activities of the Petitioner Company
without following due process of law and pas
IA NO: 1 OF 2023
Petition under Section 151 CPC praying that in the circumstances stated
in the affidavit filed in support of the petition, the High Court may be pleased
pleased to suspend theNotice of Respondent No.3 dt.25-09-2023 issued
against the branch of Petitioner Company by the Respondent No.3 and grant
such other relief or reliefs as this Hon'ble Court may deem fit and proper in the
circumstances of the case.
IA NO: 2 OF 2023
Petition under Section 151 CPC praying that in the circumstances stated
in the affidavit filed in support of the petition, the High Court may be pleased
pleased to direct the Respondent no. 3 not to take any coercive action against
the Petitioner Company for the purpose of handing over the gold ornaments
pledged by the Respondent No.6 to 10 and grant such other relief or reliefs as
this Hon'ble Court may deem fit and proper in the circumstances of the case.
IA NO: 3 OF 2023
Petition under Section 151 CPC praying that in the circumstances stated
in the affidavit filed in support of the petition, the High Court may be pleased
pleased to permit the petitioner to amend the Cause title of the petitioner in
the above Writ Petition and other interlocutory applications as "Manappuram
Asset Finance Limited, having its registered office at IV / 470 (old) W638A
//7//
WP.No.25540 of 2023& batch
(New), Manappuram House Valapad, Thrissur, Kerala, India - 680 567 and its
branch at Building No.1-49-126, VZM Road, Bangalametta, Tagarapuvalasa,
Vishakapatnam, Andhra Pradesh Represented through its authorized
signatory" in the place of "Manappuram Asset Finance & Leasing Limited,
having its registered office at IV / 470 (old) W638A (New), Manappuram
House Valapad, Thrissur, Kerala, India - 680 567 and its branch at Building
No.1-49-126, VZM Road, Bangalametta, Tagarapuvalasa, Vishakapatnam,
Andhra Pradesh Represented through its authorized signatory" and pass
Counsel for the Petitioner:
1. V NITESH
Counsel for the Respondent(S):
1. GP FOR HOME
2. T SREEDHAR
The Court made the following:
//8//
WP.No.25540 of 2023& batch
THE HONOURABLE SRI JUSTICE HARINATH.N
WRIT PETITION Nos.25540, 26267, 3584, 13928, 13944, 16467, 23417,
28721, 28888 of 2023, 8621, 9480, 9648, 10424, 14279, 17065, 23656,
23757, 24620, 25826, 26080 of 2024
COMMON ORDER:
1. The petitioners are aggrieved by the issuance of notices under Section
91 and Section 102 of Cr.P.C., (Section 94 of BNSS) by the
investigating officers of various police stations investigating the crimes
registered. The petitioners are in the business of extending loans
against the mortgage of gold ornaments.
2. The petitioners were issued notices by the investigating officers to
produce and hand over the gold ornaments during the course of the
investigation.
The details of the batch of writ petitions are as follows ;
S. WP.No. Police Station Crime Section Complaintfiled by
N numb of Law
o. er
1. WP.No.25540 Bhimunipatnam 253 of 409, Branch Head,
of 2023 Police station 2023 420 of IIFL Finance
IPC Ltd.,
2. WP.No.28721 Bobbili Town 541 of 457, K.Kavitha
of 2023 Police Station 2023 380 IPC Sravanthi
alleging theft of
her gold
ornaments
3. WP.No.26267 Bhimunipatnam 253 of 409, Branch Head,
of 2023 Police Station 2023 420 IPC IIFL Finance
Ltd.,
4 WP.No.23757 Sompta 119 of 303 (2) G.Jeevaratnam
of 2024 Police Station 2024 BNS alleging theft of
gold ornaments
5 WP.No.23656 Kovvur Town 227 of 331 (4) K.Ushasri
of 2024 Police Station 2024 305(a) alleging theft of
BNS her gold
ornaments
//9//
WP.No.25540 of 2023& batch
6 WP.No25826 Alamuru 212 of 331 (4), J.Maaruthi
of 2024 Police Station 2024 305 Sivaram,
BNS alleging theft of
gold ornaments
7 WP.No.3584 Chodavaram 32 of 454, R.Sasank Bharat
of 2023 Police Station 2023 380 IPC alleging theft of
gold ornaments
8 WP.No.26080 Tadepalli 474 of 306 M.Sambasiva
of 2024 Police Station 2024 BNS Rao
alleging theft of
gold ornaments
9 WP.No.24620 Madanapalle 423 of Woman P.Surendra,
of 2024 Rural 2024 missing alleging missing
Police Station of woman and
also theft of gold
ornaments
10 WP.No.8621 Guntakal I Town 5 of 454, D.Rajesh
of 2024 Police Station 2024 380 IPC alleging theft of
gold ornaments
11 WP.No.9480 Muddanur 286 of 454, P.Viswarupa
of 2024 Police Station 2023 380 IPC Achari
alleging theft of
gold ornaments
12 WP.No.28888 Yeleswaram 267 of 457, G.Chinnarao
of 2023 Police Station 2022 380 IPC alleging theft of
gold ornaments
Jaggampeta 295 of 457, Satyavathi Rayi
Police Station 2023 380 IPC alleging theft of
gold ornaments
Jaggampeta 296 of 457, Srinivas
Police Station 2023 380 IPC Bhumadi
Kirlampudi 103 of 457, Kanta Sanyasi
Police Station 2023 380 IPC Rao
alleging theft of
gold ornaments
Samalkota 192 of 457, Satyaveni
Police Station 2023 380 IPC Palacharlla
alleging theft of
gold ornaments
Peddapuram 120 of 457, P.Satyanarayana
Police Station 2023 380, Rao
511 IPC alleging theft of
gold ornaments
Peddapuram 174 of 457, P.Satyanarayana
Police Station 2023 380 IPC alleging theft of
gold ornaments
//10//
WP.No.25540 of 2023& batch
Yeleswaram 171 of 457, G.Reddibabu
Police Station 2023 380 IPC alleging theft of
gold ornaments
Samalkot 267 of 457, B.V.V.Satyanara
Police Station 2023 380 IPC yana
alleging theft of
gold ornaments
Jaggampeta 194 of 457, S. Srinu
Police Station 2023 380 IPC alleging theft of
gold ornaments
Samalkot 124 of 457, Devi Jyothula
Police Station 2023 380 IPC alleging theft of
gold ornaments
Prathipadu 362 of 457, K.Veerababu
Police Station 2022 380 IPC alleging theft of
gold ornaments
Addateegala 52 of 457, Y.Satyanarayana
Police Station 2022 380 IPC alleging theft of
gold ornaments
13 WP.No.23417 Krishnalanka 459 of 454, N.V.Satyanaraya
of 2023 Police Station 2023 380 IPC na Murthy
alleging theft of
gold ornaments
14 WP.No.9648 Vinukonda 75 457, D.Gangadhara
of 2024 Police Station and 380 IPC Rao
76 of D.Akhilandeswari
2024 alleging theft of
their gold
ornaments
15 WP.No.10424 Parawada 175 of 454, Ch.Ramadevi
of 2024 Police Station 2024 380 alleging theft of
IPC gold ornaments
16 WP.No.14279 Pattabhipuram 193 of 380 IPC P.Arunkumar
of 2024 Police Station 2024 alleging theft of
gold ornaments
17 WP.No.13928 Kavali I Town 55 of 380 IPC P.Madhu
of 2023 Police Station 2023 Sudhana Rao
alleging theft of
gold ornaments
18 WP.No.17065 Pendurthy 270 of 457, M.Jayanth
of 2024 Police Station 2024 380 IPC Kumar
alleging theft of
gold ornaments
19 WP.No. Pedakakani 232 of 380 IPC K.Samrajyamma
16467 of Police Station 2023 alleging theft of
2023 gold ornaments
//11//
WP.No.25540 of 2023& batch
20 WP.No.13944 Salur Town 135 of 454, N.Yogitha
of 2023 Police Station 2023 380 IPC Sailaxmi
alleging theft of
her gold
ornaments
3. Sri.P.Venkateswarlu, learned senior counsel for the petitioners, submits
that WP.No.25540 of 2023 be taken as a lead case as the other writ
petitions are also similarly placed, as such, a common order can be
passed.
4. It is submitted that the petitioner company is a leading non-banking
financial institution having branches across the country, including
various towns in the State of Andhra Pradesh. In all these writ petitions,
the petitioners have extended finance after pledging the gold
ornaments. It is also submitted that the customers who have pledged
gold ornaments have executed loan agreements, and that the pledged
gold will be returned to the customers of the petitioner company after
repayment of the gold loan, together with interest.
5. It has come to the knowledge of the petitioner-company that some of
the gold ornaments which were pledged with the petitioner-company
were subject of crime proceeds. The investigating officers of the crimes
registered at various police stations issued notices calling upon the
petitioner company to produce the gold for investigation purposes.
6. Learned senior counsel further submits that the notices issued by the
investigating officers are vague and devoid of any details about
disclosing the nature of gold ornaments or the weight of the gold
//12//
WP.No.25540 of 2023& batch
ornaments. In the absence of such details, the investigating officers
cannot call upon the petitioner company to produce the gold. It is also
submitted that the investigating officers are holding out threats of
implicating the officers of the petitioner-company as co-accused in the
event the petitioner-company does not comply with the notices issued
under Section 91 of Cr.P.C.,
7. The learned senior counsel further submits that the criminal cases in
which the police are investigating are for the purpose of punishing the
accused, not for the recovery of gold. It is also submitted that the
petitioner company is a Pawnee and as per Section 173 of the Indian
Contract Act. The Pawnee may retain the goods pledged not only for
payment of debt or for the interest on the debt, but also for all other
expenses relating to the said pledge.
8. The learned senior counsel also submits that the petitioner company
would acquire title to the goods pledged in terms of Section 178-A of the
Indian Contract Act, 1872 as the Pawnee cannot be held responsible for
defect of the title of the Pawnor. It is also submitted that the petitioner,
as a Company, is in the business of extending loans by mortgaging the
gold. Any customer who obtains a loan by mortgaging gold after
entering into a valid agreement will be responsible and liable for
repaying the entire loan, together with applicable interest and other
charges. It is only after discharge of the loan amount and other charges
that the Pawnor can reclaim the gold ornaments. Any event of default
//13//
WP.No.25540 of 2023& batch
under the terms of the agreements would entitle the petitioner company
to auction the gold towards the realisation of the outstanding dues.
9. It is also submitted that the respondent/police authorities were duly
informed about the contractual obligation of the Pawnee and Pawnor
and that the respondent/police authorities are not justified in issuing the
impugned notices calling upon the petitioner-company to
deposit/handover the gold ornaments as called upon through the
impugned notices.
10. The learned senior counsel places reliance on K.M.Shalima Vs. State
of Kerala1, and submits that the Pawnee has a right to retain the gold
ornaments pending discharge of the loan by the Pawnor. It is also
submitted that the learned single Judge of the High Court of Kerala at
Ernakulam held that Sections 173 and 178-A of the Indian Contract Act
would apply to the petitioner therein. The learned senior counsel places
reliance on Muthoot Fincorp Limited Vs. The Station House Officer
& Ors2, the Hon’ble Supreme Court, while dealing with an SLP filed by
Muthoot Fincorp Limited, recorded the undertaking submitted by the
petitioner whereby the petitioner undertook to produce the pledged
ornaments as and when called by the investigating officer for inspection
of the same and also permit taking photographs and making the
panchanama. A further undertaking to produce the pledged ornaments
before the concerned Court as and when directed by the concerned
1
2016 SCC OnLine Ker41332
2
SLP (CRL.)9539 of 2023
//14//
WP.No.25540 of 2023& batch
Court, apart from undertaking not to hand over the pledged ornaments
to the pledger or any person representing him or redemption of pledge
without permission from the concerned Court and also not to sell the
gold or any portion of the same without prior permission of the Court.
The learned senior counsel submits that a similar direction be passed in
the writ petitions.
11. Sri.T.Sridhar, learned counsel appearing for respondent No.4, submits
that the petitioner-company cannot take the shelter of Section 173 and
178-A of the Indian Contract Act as the petitioner cannot claim legal
retention of the proceeds of a crime. It is submitted that the gold
ornaments, which are in possession of the petitioner company, form the
subject of the crime property. The crime property would have to be
surrendered to the police, and the police have an unfettered right to
seize the same pending investigation.
12. The 4th respondent in WP.No.25540 of 2023 is a representative of IIFL
Finance Limited, and the other unofficial respondents resorted to
committing a crime, which led to the registration of a crime by IIFL
Finance Limited. The learned counsel for the 4th respondent further
submits that the High Court of Telangana, in WP.No.37182 of 2021 and
batch of writ petitions, dismissed the writ petitions filed by the petitioners
therein. It is submitted that similar prayers were sought, whereby
notices issued under Sections 91 and 102 of Cr.P.C. were under
challenge. The learned Judge dismissed the writ petitions by holding
//15//
WP.No.25540 of 2023& batch
that the respondent/ police/ investigating officers were given liberty to
seize gold articles from the petitioners by complying with the procedure
under Section 102 Cr. P.C,
13. It is also submitted by the learned counsel for respondent No. 4 that the
gold ornaments under mortgage to the petitioners would have to be
considered as crime property under Section 114 of the Indian Evidence
Act. It is submitted that the petitioner company is duty-bound to
ascertain the source of possession of the gold ornaments before
pledging them. It is also submitted that the petitioner-company’s
extension of the gold loan by pledging gold ornaments is supported by
an agreement. Any defect in the title for the gold pledged would entitle
the petitioner company to take steps for recovery of the outstanding
dues by invoking the jurisdiction of the competent Court or invoking the
dispute resolution clause as per the recitals of the agreement(s).
14. The learned Government Pleader appearing for the State submits that
various police stations received complaints regarding the theft of gold,
and upon receipt of such complaints, crimes were registered. During the
course of the investigation, it has come to the knowledge of the
investigating officers that the crime property was mortgaged with the
petitioner company (companies) by the accused. It is the statutory duty
of the police to investigate the crimes registered.
//16//
WP.No.25540 of 2023& batch
15. It is also submitted that it is the bounden duty of the State to investigate
the registered crimes, and the interests of the victims who lost their gold
would have to be protected.
16. Heard the learned senior counsel appearing for the petitioner-
company(companies), learned counsel appearing for the 4th
respondent and the learned Government Pleader for the State. Perused
the material on record.
17. The short point for consideration in the batch of writ petitions is
Whether a direction as sought by the petitioners seeking
to set aside the impugned notice(s) issued under
Sections 91 and Section 102 of Cr.P.C., can be issued by
exercising the jurisdiction under Article 226 of the
Constitution of India ?
18. In the present batch of writ petitions, WP Nos. 25540 of 2023 and
26267 of 2023, are filed by representatives of a finance company
alleging that their own employees are involved in misappropriating gold
ornaments belonging to customers and subsequently subjecting them to
mortgage with the petitioners. In WP.No.28888 of 2023, the petitioner is
challenging the notices issued under Section 91 of the Cr.P.C. in as
many as 12 FIRs registered in various police stations, all of which are
registered for offences under Section 380 of the IPC and Sections 454
and 457 of the IPC. All the complainants had reported house breaking
and theft of valuables, including gold ornaments. Those gold ornaments
were mortgaged by the accused with the petitioner company.
//17//
WP.No.25540 of 2023& batch
19. In all the other writ petitions, the complainants are individuals who have
complained of housebreaking and theft/robbery of their gold ornaments.
The complainants have detailed the description and approximate weight
of the gold ornaments in their respective complaints.
20. The police have registered complaints, and after apprehending the
accused, the investigating officers are informed about the mortgage of
the gold ornaments with the petitioner company (companies) by the
accused. In furtherance of the investigation, the investigating officer has
rightly issued notices under Section 91 and 102 of the Cr.P.C. to the
petitioners to produce the gold ornaments, as they are crime property.
The investigating officer would have to complete investigation and also
deposit the crime property before the competent Magistrate Court.
21. The petitioners would enter into loan agreements with their customers
while depositing the gold ornaments. This Court requested the learned
counsel appearing for the petitioners to submit one set of the standard
documentation for obtaining a gold loan and the operating guidelines for
extending the loans. The relevant documentation is submitted.
22. As seen from the said documents, an undertaking to the effect that the
Pawnor is the absolute owner and possessor of the gold ornaments
which are mortgaged. It is also stated in the undertaking by the
Pawnors that they would take on the entire liability and would be liable
to repay the total outstanding amount, together with interest and
applicable charges, in the event it comes to the knowledge of the
//18//
WP.No.25540 of 2023& batch
Finance Company that the Pawnor does not have legal title to the gold
ornaments. The loan policy also mandates the petitioner to conduct
proper due diligence on their customers and ensure ownership of the
gold in line with relevant regulatory norms. The loan policy of the
petitioner company also suggested that the Branch Head/Manager
ensure proper verification and collect additional confirmation regarding
ownership and possession of gold ornaments. Documents such as
proof of inheritance and proof of purchase would have to be verified.
Additionally, the Branch Head/Branch Manager would have to issue a
certificate confirming that proper due diligence was conducted to
establish ownership, as part of the customer due diligence process,
which would also have to be preserved along with the loan application
form.
23. The persons who are accused of committing theft have devised a new
method of liquidating the stolen property. The accused, by layering the
gold ornaments as a mortgage property, are liquidating the crime
proceeds. The manner in which the proceeds of crime are dealt with by
the accused, who executes loan agreements and creates a contractual
obligation between a Pawnee and a Pawnor, cannot come to the rescue
of the petitioners. The petitioners, as companies, are authorised to
extend gold loans and would have to devise their own methods of
safeguards to mitigate the legal consequences of pledging stolen
property.
//19//
WP.No.25540 of 2023& batch
24. The petitioners would have to invoke the appropriate clause of the
agreement for dispute resolution and recover the outstanding dues from
the Pawnor. The Pawnor would have no legal right to create a lien on
the stolen property, and the Pawnee cannot also endorse stamping of
validity by pledging the stolen property. These issues would be
considered by the trial Court deciding the cases on the merits. Insofar
as the challenge before this Court to the impugned notices issued by
the investigating officers is concerned, this Court cannot interfere in the
process of investigation. The investigating officers would have to be
given a free hand in completing the investigation.
25. The plight of the victims who lost their gold should be kept in mind by
the Courts. The victims have complained of theft/robbery from their
homes. The personal jewellery of the victims was stolen by the
accused. During the course of the investigation, the investigating officer
has gathered evidence regarding the pledging of crime property by the
petitioners. To complete the investigation, the investigating officers
exercised their powers under Section 91 and 102 Cr.P.C. and called
upon the petitioners to produce the gold ornaments. The said notices
ought not to be interfered with.
26. The petitioners have a remedy of recovery from the customers who
executed the loan agreements. Whereas, the victims whose property
was the subject of theft would be left remediless if this Court interferes
//20//
WP.No.25540 of 2023& batch
with the investigation and interdicts the notices issued by the
investigating officers.
27. The observations of the Hon’ble Supreme Court in SLP (CRL.) 4351 of
2022 permitting the appellants to make an application under Sections
451 and 457 of Cr.P.C., before the learned Magistrate and the learned
Magistrate was further directed to entertain the application and pass
necessary orders. The further directions of Hon’ble Supreme Court in
SLP (CRL) 9539 of 2023, whereby the additional affidavit filed by the
appellants undertaking to produce the pledged ornaments as and when
called by the investigating officer and also produce them before the trial
Court as and when directed by the learned Magistrate and the other
undertaking of the appellant was taken on record. These orders would
not come to the aid of the petitioners, as in those cases, the
investigating officer already deposited the property before the
Magistrate Court, and the facts of those cases are entirely different and
distinct from the facts on hand in the batch of above writ petitions.
28. The petitioners are registered, authorized and regulated by the Reserve
Bank of India for conducting their business as non-banking financial
institutions. This would not entitle the petitioners to mortgage a theft
property or a crime property and claim protection under Sections 173
and 178-A of the Indian Contract Act. The petitioners can invoke those
provisions of law against their customers in the event of any dispute
between them. In cases where the petitioners are informed that a crime
//21//
WP.No.25540 of 2023& batch
property is subject to a mortgage, the petitioners would not be entitled
to ratify the theft or crime by executing an agreement with the accused.
29. The petitioners ought to have ample safeguards in place while
extending gold loans. In the above batch of cases, the petitioners
cannot challenge the issuance of notices under Section 91 and 102
Cr.P.C., as they have no vested legal right to obstruct the investigation
by claiming protection under Section 173 and 178-A of the Indian
Contract Act. The petitioners also cannot claim to be victims, as they
have an effective and alternative remedy of initiating appropriate
proceedings for the recovery of the entire loan amount, together with all
other applicable interest and charges.
30. That apart, the objection raised by the learned senior counsel that the
impugned notices are bereft of any details is concerned, the relevant
details relating to the loan agreement and other details relating to the
ornaments pledged are already mentioned in the notices. The
petitioners can correlate the ornaments pledged with the Customer ID
and the agreement number.
31. The consequences of this Court setting aside the notices under
Sections 91 and 102 of Cr.P.C. would give the petitioners a free run to
sell off the gold ornaments and appropriate the proceeds towards their
outstanding loan account. In such a scenario, the victims would lose
their gold and be at the receiving end, with no respite or remedy.
//22//
WP.No.25540 of 2023& batch
32. That being said, it is the statutory duty of the police to complete the
investigation by recovering the stolen property to the extent possible
and depositing it before the concerned jurisdictional Magistrate for safe
custody. It would be open for the claimants to claim the gold ornaments
for interim custody by filing the appropriate petitions under Sections 451
and 457 of the Cr.P.C. before the jurisdictional Magistrate. Upon receipt
of such petitions, the learned Magistrate would have to deal with them
in accordance with the law. It is left open for the investigating officers to
take the necessary steps to secure the crime property at the earliest to
complete the investigation. Several crimes were reported about 2-3
years ago, and the victims were left in a lurch, denied access to their
gold ornaments. In any household, the woman would have emotional
bonding with their jewellery and at times the jewellery is passed on from
generation to generation.
33. The family gold ornaments carry sentimental value, cultural significance
and are symbols of emotional inheritance. The property belonging to the
complainants is now in the custody of the petitioners. The said custody
is due to the accused pledging gold ornaments. Thus, the complainants
would have the primary right and interest to claim interim custody over
the same. At the same time, the petitioners can invoke the dispute
resolution clause of the loan agreements and initiate recovery
proceedings against the customers who have defaulted. Granting any
order in favour of the petitioners by interdicting the impugned notices
//23//
WP.No.25540 of 2023& batch
would be counterproductive for the actual victims and their claim over
the gold ornaments.
34. As such, this Court is of the considered view that the writ petitions filed
challenging the impugned notices issued under Sections 91 and 102
Cr.P.C. deserve to be dismissed.
35. Accordingly, the writ petitions are dismissed.
As a sequel, miscellaneous petitions pending, if any, shall stand closed.
___________________
JUSTICE HARINATH.N
Dated 30.08.2025
LR Copy to be marked
B/o.KGM
//24//
WP.No.25540 of 2023& batch
THE HON’BLE SRI JUSTICE HARINATH. N
WRIT PETITION Nos.25540, 26267, 3584, 13928, 13944, 16467, 23417,
28721, 28888 of 2023, 8621, 9480, 9648, 10424, 14279, 17065, 23656,
23757, 24620, 25826, 26080 of 2024
Dated 30.08.2025
LR Copy
KGM
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