1 abs IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION CRIMINAL WRIT PETITION NO. 2958 OF 2009 WITH WRIT PETITION NOS. , 2955, 2956 AND 2957 OF 2009 Vishwas Narhari Yande .. Petitioner V/s The State of Maharashtra & Ors. .. Respondents Mr. Shirish Gupte, Senior Advocate with Mr. A.P. Mundargi, Mr. Sanjeev A. Sawant and Mr. Himanshu Kode for the petitioner. Mr. A.H.H. Ponda for respondent no.4 in W.P. Nos. 2955/09 and 2958/09. Ms. S.D. Khot with Ms. Ameeta Kuttikrishnan for respondent no.4 in W.P. Nos. 2956/09 and 2957/09. Mr. A.S. Shitole, A.P.P. for the State in W.P. Nos. 2955/09, 2956/09 and 2957/09. Ms. M.H. Mhatre, A.P.P. for the State in W.P. No. 2958/09. CORAM: D.G. KARNIK, JJ. DATE : 20TH NOVEMBER 2009 21ST NOVEMBER 2009 2 ORAL ORDER : 1. Rule, returnable forthwith. 2. By consent, taken up for hearing. Heard counsel for the appearing parties. 3. These writ petitions are directed against a common order dated 13th, 14th and 15th October 2009 passed by the Court of Sessions, Mumbai in Revision Application Nos.648, 868 and 869 of 2009. Hence, these writ petitions are also disposed of by this common order. 4. Mr. Yeshwant Yande (hereinafter referred to as “the complainant”) filed an FIR with the Matunga Police Station at Mumbai on 14th September 2006 alleging therein that Rekha Naik (hereinafter referred to as “the accused no.1”) and her husband Deepak Naik (hereinafter referred to as “the accused no.2”), who were entrusted by the complainant 43 valuable paintings (painted on 42 sheets of papers) painted by a famous artist Mr. Gaitonde were disposed of by them by committing criminal breach of trust. During the course of investigation, police found out that 25 paintings (drawn on 24 sheets) were in possession of Mr. Wadera (accused no.3) and 15 paintings were 3 in possession of one Mr. Todywala. Mr. Wadera was arrested and paintings in his possession were seized by the police. He has since been granted bail. Mr. Todywala, who has not yet been accused of any offence, but on learning of filing of the FIR, voluntarily produced the 15 paintings in his possession before the police. Thus, in all 40 paintings are in possession of police. A charge-sheet has not yet been filed and investigation is stated to be still on. During the pendency of the investigation, the complainant made an application in the Court of Metropolitan Magistrate under section 451 of the Code of Criminal Procedure (for short “the Cr. P.C.”) for return of the paintings. Mr. Wadera also made two separate applications for return of the paintings seized from his custody and Mr. Todywala also made similar application for return of the paintings produced by him before the police. By four separate orders, the learned Metropolitan Magistrate rejected all the applications. Aggrieved by the orders of the Metropolitan Magistrate, the complainant as well as Mr. Wadera and Mr. Todywala filed four separate revision applications before the Court of Sessions. By the common order dated 13/14/15th October 2009, the Sessions Court dismissed the revision applications filed by the complainant but allowed the revision applications filed by Mr. Wadera and Mr. Todywala, and directed return of the paintings to them subject 4 to each of them executing security bond of Rs.50 lakhs and other conditions specified in the order. That order is impugned by the complainant by these four petitions. 5. The first point that arises for consideration is whether the learned Sessions Judge ought to have passed the order for return of the paintings during the pendency of the investigation and even before the charge-sheet is filed. In Sundar A. Desai v. State of Gujarat, 2003 All M.R. (Cri.) 363, the Supreme Court after following its earlier decision in Vasavaco Gymangond Patil v. State of Mysore, (1977) 4 SCC 358, held that as regards the valuable articles such as gold or silver ornaments or articles studded with precious stones, it is of no use to keep such articles in police custody for years till the trial is over and the Magistrate should pass appropriate orders as contemplated under section 451 of the Cr. P.C. at the earliest. In the present case, the property are valuable paintings. Counsel submitted that Mr. Wadera had purchased paintings for Rs.55 lakhs and Mr. Todywala had purchased the paintings for Rs.84 lakhs. In both the cases, consideration was paid partly in cash and partly by exchange of other paintings. The parties are unanimous that paintings are very valuable. It is also the case of the parties that the paintings are likely to 5 deteriorate in police custody and and they are required to be preserved with care and caution. There is no proper place for preservation of the paintings at the police station or in the court premises. Counsel stated that an attempt was made to keep the paintings for preservation in art galleries, but in view of the litigation no art gallery was willing to take the paintings in its custody for preservation. In the circumstances, it was appropriate for the Sessions Court to interfere with the order of the Magistrate refusing custody to anyone. The paintings must be given in custody of one or some of the parties for preservation. The only question required to be considered is to whom the custody of the paintings be given. 6. Mr. Gupte, learned senior advocate for the petitioner, submitted that there is no dispute that the complainant was the owner of the paintings and had entrusted the paintings to the accused no.1, though the purpose and terms of custody are disputed questions. According to the complainant, the accused no.1 fraudulently and without any authority transferred the paintings and thereby committed several offences including cheating, criminal breach of trust, etc. The paintings must therefore be regarded as stolen property as defined under section 410 of the I.P.C. Mr. Wadera and Mr. Todywala must, therefore, be 6 deemed to be receivers of the stolen property and cannot get any title to the paintings. The paintings should therefore be returned to the owner, i.e. the complainant. In support he referred to and relied upon a decision of this Court in Mahindra Saigal v. State of Maharashtra, 1986 (3) Bom. C.R. 25, a decision of the Mysore High Court in Yousoof Marakair v. State of Mysore, AIR 1969 Mysore 203 and a decision of the Madras High Court in A.S.S. Ahmed Sahib v. Commissioner of Police, AIR 1970 Madras 220. 7. Per contra, Mr. Ponda and Ms. Khot, learned counsel appearing for Mr. Todywala and Mr. Wadera respectively, submitted that admittedly the paintings were given by the complainant to the accused no.1. The facts unequivocally disclose that the paintings were given to her for sale and not given by way of any other entrustment. The paintings were sold by the accused no.1 to Mr. Wadera and Mr. Todywala for consideration. Mr. Wadera and Mr. Todywala were bonafide purchasers for value without notice. They were entitled to assume that the accused no.1 had an authority to sell the paintings and relying upon the said authority and without knowledge of any alleged defect or lack of authority, they had purchased the paintings for valuable consideration of several lacs of rupees. Therefore, they were 7 prima facie owners of the paintings and were entitled to the possession thereof. In support, Mr. Ponda relied upon a decision of the Supreme Court in State of Gujarat v. Jaswant Nahalal, AIR 1968 SC 700 and a decision of a Division Bench of this Court in Lakshmichand Rajmal v. Gopikisan Balmukund, AIR 1936 Bombay 171. 8. In order to appreciate the contentions of the parties, it is necessary to recite a few facts. Before filing the FIR dated 14th September 2006, the complainant had written a letter to the Joint Commissioner of Police on 16th August 2006. In the letter dated 16th August 2006 and in the FIR dated 14th September 2006 the complainant has stated that he retired as a professor in the J.J. School of Arts where he happened to meet Mr. Gaitonde. Mr. Gaitonde, the famous painter, gave/gifted to him the 46 paintings in question and thus the complainant became the owner of the paintings. In the year 2002, the complainant was introduced to the accused no.1; she showed interest in the works of art owned by the complainant and in the year 2004, she sold on his behalf some of the paintings and other works of art and paid him the consideration in cash. In May 2005, the accused no.1 again approached the petitioner for sale of the paintings of Mr. Gaitonde stating that Mr. Vijay Mallya was an interested buyer. The 8 paintings were given by the complainant to the accused no.1 for sale to Mr. Mallya. On 10th July 2005, the accused no.1 went to the house of the complainant who told her that as his wife was serious, he was not in a position to give her any decision about the sale and told her: “We again told her that we were not in a position to give any decision and further told her that we have been considering her as a family member and she may take any proper decision but inform her before committing the deal.” (underlining supplied) Reading of the letter and the FIR shows that the complainant had given the paintings to the accused no.1 for sale and he had also authorised her to take any proper decision about the sale. Of course, a condition was imposed on her that she should inform the complainant before committing the deal. The condition was only to inform and not to take prior permission. In other words, prima facie, the accused no.1 was given an authority to take the decision and sell the paintings at a price she considered appropriate and intimate the complainant about the deal made by her. There is nothing on record to show that the purchasers were in any way aware that the accused no.1 was required 9 to give a prior intimation to the complainant before the sale. The FIR further states that on reading an article appearing in the Times of India on 24th July 2005, the complainant became aware that 15 paintings drawn by Gaitonde and given by him to the accused no.1 were sold by her. Despite the knowledge of sale by the accused no.1, which according to the complainant was clandestine and without intimation to him, the complainant did not take any action. On the other hand, the FIR states about the meetings between the complainant and the accused no.1 after 24th July 2005. The complainant has further admitted that he received Rs.13 lakhs in cash in four installments from the accused no.1 after 24th July 2005. This prima facie shows even assuming that the sale by the accused no.1 was without an authority, it was ratified by the complainant. 9. Section 27 of the Sale of Goods Act says that when the goods are sold by a person who is not the owner thereof and who does not sell them under the authority or with the consent of the owner, the buyer acquires no better title to the goods than the seller had, unless the owner of the goods by his conduct is precluded from denying the seller’s authority to sell. The general rule of caveat emptor and/or the rule that a buyer gets no title better than that of a seller is subject to 10 two exceptions. The first exception provided by section 27 is that where the seller of the goods sells them under the authority or with the consent of the buyer. In the present case, the FIR prima facie discloses that the complainant had given authority to the accused no.1 to sell and, in any event, had consented to the sale and/or ratified the sale by accepting a substantial sum of Rs.13 lakhs from the accused no.1 after the knowledge of sale. The second exception is contained in the proviso to section 27 of the Sale of Goods Act which reads thus: “27. Sale by person not the owner.-Subject to the provisions of this Act and of any other law for the time being in force, where goods are sold by a person who is not the owner thereof and who does not sell them under the authority or with the consent of the owner, the buyer acquires no better title to the goods than the seller had, unless the owner of the goods is by his conduct precluded from denying the seller's authority to sell: Provided that, where a mercantile agent is, with the consent of the owner, in possession of the goods or of a document of title to the goods, any sale made by him, when acting in the ordinary course of business of a mercantile agent, shall be as valid as if he were expressly authorised by the owner of the goods to make the 11 same; Provided that the buyer acts in good faith and has not at the time of the contract of sale notice that the seller has not authority to sell.” In the present case, the accused no.1, prima facie, was a mercantile agent in a sense that she is a dealer in the works of art, and in the past had acted as an agent for sale of other works of art for the complainant himself. The complainant had given her authority to sell the paintings but had only stated that she should inform, as opposed to taking prior approval, of the sale. Mr. Wadera and Mr. Todywala, prima facie, had no notice that the accused no.1 had no authority to sell or her authority was conditional upon obtaining of prior permission of the complainant. The contention of Mr. Wadera and Mr. Todywala, the buyers of the paintings, that they acted in good faith, and at the time of the contract of sale had no notice that the accused no.1 had no authority to sell, can be accepted. They are therefore protected by proviso to section 27 of the Sale of Goods Act. 10. As between the claim of the complainant on the one hand and of Mr.Wadera and Mr. Todywala on the other, for the custody of the paintings, I am generally in agreement with the reasons given by the 12 Court of Sessions for granting custody to Mr. Wadera and Mr. Todywala. I would however like to give a few more reasons. Admittedly, the complainant is about 82 years of age. There is no evidence of his present health and physical ability to preserve the paintings during the whole of the course of trial. After him, it would be difficult to trace the paintings in the hands of persons who are not bound under any bond to the Court and whose identity and address would be unknown. In any event, the complainant’s love and affection for the paintings was limited to money and he had given them to the accused no.1 for sale. Mr. Wadera and Mr. Todywala are young buyers. They have bought the paintings by spending millions of rupees. They, through their counsel, expressed willingness to execute a bond for preservation and safe custody of the paintings and also offered to give independent sureties for the preservation and production of the paintings in the court whenever necessary. They appear to be art lovers. Mr. Todywala and Mr. Wadera through their respective counsel submitted that these paintings would be preserved and only exhibited in art galleries for view of art lovers, but would not be sold or transferred and they would not part with their possession. It may also be noted that Mr. Todywala voluntarily produced the paintings before the police though he had ample opportunity of disposing of them 13 earlier. He preserved the paintings for a period of more than 18 months even after the police started enquiry about them. This conduct shows his bonafides. In my view, therefore, the Sessions Judge was right in giving custody of the paintings to them. 11. It is well settled principle of law that in exercise of discretionary jurisdiction under Article 227 of the Constitution, the High Court would not ordinarily interfere in a discretion legally vested in the court below unless the order is arbitrary or perverse. I do not find anything arbitrary or perverse in the order of the Court of Sessions. Hence, subject to a small modification which is made by this order, the order of the Court of Sessions deserves to be confirmed. 12. Learned Sessions Judge has ordered Mr. Wadera and Mr. Todywala to execute Rs.50 lakhs bond each. According to Mr. Todywala, he purchased the paintings for Rs.84 lakhs and according to Mr. Wadera he purchased the paintings for Rs.55 lakhs. The amounts of personal bonds need to be increased suitably with a direction to give one or more sureties. Accordingly, Mr. Todywala is directed to execute a personal bond in the sum of Rs.1 crore and Mr. Wadera is directed to execute a personal bond in the sum of Rs.75 lakhs. Each of them shall 14 also execute one or more sureties of the amount equivalent to their personal bonds before release of the paintings. Subject to this modification, the order of the Sessions Court is confirmed with all other conditions imposed by the Sessions Court. 13. It is clarified that all the observations made in this order are prima facie and the trial court shall not be bound by them at the stage of trial. 14. After the pronouncement of the order, learned counsel for the petitioner prays for stay of the operation of this order to enable the petitioner to approach the superior court. Operation of this order is stayed for a period of 4 weeks. However, the interim protection granted earlier shall continue for 4 weeks. (D.G. KARNIK, J.)