The power of seizure in section 102 Cr.P.C. has to be limited to moveable property: High Court of Delhi

 IN THE HIGH COURT OF DELHI AT NEW DELHI Date of decision: 31.05.2021 W.P.1256 2020 INDIABULLS COMMERCIAL CREDIT LIMITED ..... Petitioner Through Mr.Vivek Pahwa Sr. Adv. with Mr.Ankit Banaoti Adv. ECONOMIC OFFENCES WING & ORS. Through Mr.Rajesh Mahajan ASCwith Respondent Ms.Jyoti Babbar Adv. for State. Insp. A.K. Singh PS EOW. Mr.Amandeep Singh Adv. for Intervenors RG Luxury Home Buyers Association applicant. Mr.Vivek Kohli Sr. Adv. with Mr.Mudit Gupta Adv. for R 4 to R Mr.Rudreshwar Singh Adv. with Mr.Gautam Singh Adv. for intervenors RG Jan Kalyan Samiti applicant. HON BLE MR. JUSTICE SURESH KUMAR KAIT JUDGMENTThe hearing has been conducted through video conferencing. W.P.(Crl.) 1256 2020 & Crl.M.A.11172 2020Present petition has been filed under section 226 of the Constitution W.P.(CRL.) 1256 2020 of India read with section 482 Cr.P.C. seeking directions thereby against respondent no.1 for quashing of order notice dated 05.08.2019 bearing No.531 R ACP SEC V EOW issued by the office of the Offences Wing New Delhi to the Sub Registrar IIA Punjabi Bagh Nangloi Delhi under section 102 of the Code of Criminal Procedure 1973. Counsel for the petitioner submits that the petitioner herein is a Non Banking Financial Company registered with the Reserve Bank of India and also a financial institution under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 SARFAESI Act). The petitioner has granted two loans against a property to respondent nos. 4 to 10 and upon failure to pay EMI’s on time the loan accounts of the said respondents were declared Non Performing Assets NPA) and statutory proceedings under the SARFAESI Act were conducted. Counsel for the petitioner further submits that the property in question bearing Plot No. 32 Road No. 42 Punjabi BaghDelhi 110026 is mortgaged however vide impugned notice dated 05.08.2019 ACP EOW communicated to the Sub Registrar II A Punjabi Bagh Nangloi Delhi as reproduced under: “Investigation of the above said case is being conducted by the undersigned at Section V EOW Mandir Marg New W.P.(CRL.) 1256 2020 Delhi. Brief facts of the case are that Rajesh Project Pvt. Ltd. whose managing Director is Mr. Rajesh Goyal had launched a residential housing project “RG Luxury Homes” in Greater Noida UP. He collected more than 600 crore from 1672 flat buyer 2010 onwards for the said project but the abovesaid company could not complete the project. All the money collected from the complainants investors were siphoned off to the different accounts. The transaction related to this property is subject matter of investigation of the above mentioned FIR. It is also apprehended that the property may be further transferred. In view of the above facts it would be appropriate to place an embargo on the further sale transfer on the above said property i.e. Plot no. 32 road no. 42 registered in the name of M s R K Sons Rajesh Goyal in Punjabi Bagh West New Delhi under the provision of 102 Cr.P.C. Confirmation regarding placing embargo on the above land may also be intimated to the undersigned. Larger public interest is involved in the matter and therefore earliest action and confirmation is desirable.” Counsel for petitioner submits that the impugned order is in direct contravention of Section 102 Cr.P.C. as the said provision does not grant any power for the seizure of immovable properties and same is against law and deserves to be set aside. Accordingly for convenience section 102 of Cr.P.C. is reproduced as under: “102. Power of police officer to seize certain property. 1) Any police officer may seize any property which may be alleged or suspected to have been stolen or which may be W.P.(CRL.) 1256 2020 found under circumstances which create suspicion of the commission of any offence. 2) Such police officer if subordinate to the officer in charge of a police station shall forthwith report the seizure to that 3) 1 Every police officer acting under sub sectionshall forthwith report the seizure to the Magistrate having jurisdiction and where the property seized is such that it cannot be conveniently transported to the Court he may give custody thereof to any person on his executing a bond undertaking to produce the property before the Court as and when required and to give effect to the further orders of the Court as to the disposal of the same.]” To strengthen his arguments counsel for the petitioner has relied upon the case of Nevada Properties Private Limited vs. State of Maharashtra: 2019 SCC OnLine SC 1247 wherein the Hon’ble Supreme Court has held as under: “18. Having held and elucidated on the power of the Criminal Court we find good ground and reason to hold that the expression ‘any property’ appearing in Section 102 of the Code would not include immovable property. We would elucidate and explain. 19. The first part of sub section of Section 102 of the Code relates to the property which may be alleged or suspected to have been stolen. Immovable property certainly cannot be stolen and cannot fall in this part. The second part relates to the property which may be found by a police officer under circumstances which create suspicion of the commission of any offence. We have already referred to the judgments of the Delhi High Court in the case of P.K. Parmar Ms. Swaran Sabharwal and W.P.(CRL.) 1256 2020 Jagdish Chander which have elucidated and in a restricted and narrow manner defined the requirement for invoking the second part. However we have come across a decision of this Court in Teesta Atul Setalvad v. State of Gujarat on an appeal from the judgment of the Gujarat High Court and had dealt with a situation when an act of freezing the accounts was a sequel to the crime as the crime was detected earlier. The Gujarat High Court took a somewhat contrary view by not interfering and directing defreezing observing that even if the action of the investigating agency at the inception to seize may not be regular the Court cannot be oblivious to the collection of substantial material by the investigating agency which justifies its action under Section 102 of the Code. Further when the investigation had progressed to a material point de freezing the bank accounts on the basis of such arguments would paralyse the investigation which would not be in the interest of justice. After referring to the factual matrix in Teesta Atul Setalvad this Court observed that the Investigating Officer was in possession of material pointing out to the circumstances that had created suspicion of the commission of an offence in particular the one under investigation and therefore exercise of power under Section 102 of the Code would be in law legitimate as it was exercised after following the procedure prescribed in sub sectionsandof the same provision. the property. 20. Section 102 postulates seizure of Immovable property cannot in its strict sense be seized though documents of title etc. relating to immovable property can be seized taken into custody and produced. Immovable property can be attached and also locked sealed. It could be argued that the word ‘seize’ would include such action of attachment and sealing. Seizure of immovable property in this sense and manner would in law require dispossession of the person in occupation possession of the immovable property unless there are no claimants which would be rare. Language of Section 102 of the Code does W.P.(CRL.) 1256 2020 not support the interpretation that the police officer has the power to dispossess a person in occupation and take possession of an immovable property in order to seize it. In the absence of the Legislature conferring this express or implied power under Section 102 of the Code to the police officer we would hesitate and not hold that this power should be inferred and is implicit in the power to effect seizure. Equally important for the purpose of interpretation is the scope and object of Section 102 of the Code which is to help and assist investigation and to enable the police officer to collect and collate evidence to be produced to prove the charge complained of and set up in the chargesheet. The Section is a part of the provisions concerning investigation undertaken by the police officer. After the charge sheet is filed the prosecution leads and produces evidence to secure conviction. Section 102 is not per se an enabling provision by which the police officer acts to seize the property to do justice and to hand over the property to a person whom the police officer feels is the rightful and true owner. This is clear from the objective behind Section 102 use of the words in the Section and the scope and ambit of the power conferred on the Criminal Court vide Sections 451 to 459 of the Code. The expression ‘circumstances which create suspicion of the commission of any offence’ in Section 102 does not refer to a firm opinion or an adjudication finding by a police officer to ascertain whether or not ‘any property’ is required to be seized. The word ‘suspicion’ is a weaker and a broader expression than ‘reasonable belief’ or ‘satisfaction’. The police officer is an investigator and not an adjudicator or a decision maker. This is the reason why the Ordinance was enacted to deal with attachment of money and immovable properties in cases of scheduled offences. In case and if we allow the police officer to ‘seize’ immovable property on a mere ‘suspicion of the commission of any offence’ it would mean and imply giving a drastic and extreme power to dispossess etc. to the police officer on a mere conjecture and surmise that is on suspicion which has hitherto not been exercised. W.P.(CRL.) 1256 2020 We have hardly come across any case where immovable property was seized vide an attachment order that was treated as a seizure order by police officer under Section 102 of the Code. The reason is obvious. Disputes relating to title possession etc. of immovable property are civil disputes which have to be decided and adjudicated in Civil Courts. We must discourage and stall any attempt to convert civil disputes into criminal cases to put pressure on the other side1256 2020 37. If the argument of the appellant and the State of Maharashtra is accepted then there was no need for the legislature to have introduced Chapter VIIA. It would also be pertinent to mention that the power of attachment and forfeiture is given to courts and not to police officer. As pointed out in the judgment of my learned brother if a police officer is given the power to seize immovable property it may lead to an absolutely chaotic situation. To give an example if there is a physical fight between appellant is to be accepted the police official would be entitled to seize the tenanted property. This would make a mockery of rent laws. To give another example if a person forges a will and thereby claims property on the basis of the forged will can the police officer be given the power to seize the entire property both movable and immovable that may be mentioned in the will The answer has to be in the negative. Otherwise it would lead to an absurd situation which could never have been envisaged by the Legislature. The power of seizure in Section 102 has to be limited to movable property. 38. As far as the meaning of property in Section 452 of the Cr.P.C. is concerned that is not a question referred to the larger Bench and therefore I would refrain from saying anything about that. 39. In view of the above I would answer the reference by holding that the phrase ‘any property’ in Section 102 will only cover moveable property and not immovable property.” Learned ASC appearing on behalf of the State submits that the intent of the investigating agency vide impugned notice is not to attach seize or seal the property but to preserve the property in question so that any third party interest is not created without causing dispossession. It was done in the larger interest of the investors. W.P.(CRL.) 1256 2020 7. It is further submitted by learned ASC that the notice issued is not against the overall spirit of the judgement of the Hon ble Supreme Court in Nevada case notice under section 102 Cr.P.C. is not sustainable. Accordingly the said notice is hereby set aside. 10. The order passed by this Court shall not affect any of the proceedings pending either before any court or tribunal. Crl.M.A.1854 2021 & Crl. M.B. 721 2021 11. Present applications have been filed by the applicants seeking intervention in the present petition. 12. Since the impugned order is limited to the issue of section 102 W.P.(CRL.) 1256 2020 Cr.P.C. therefore no order is required to be passed in the present applications. 13. Therefore same are accordingly dismissed. 14. Any other pending application if any also stands disposed of. SURESH KUMAR KAIT) MAY 31 2021 ab W.P.(CRL.) 1256 2020 

Summary: The writing of a letter to revenue authorities to maintain status-quo qua the title is a permissible step as it is distinct and different from attaching, sealing &amp; seizure of immovable property as observed by the Hon’ble Supreme Court in its judgement. The power of seizure in section 102 Cr.P.C. has to be limited to moveable property whereas in the present case, property in question is immoveable, thus, the steps taken under section 102 Cr.P.C. is illegal. This was held in INDIABULLS COMMERCIAL CREDIT LIMITE v. ECONOMIC OFFENCES WING &amp; ORS. [W.P. (CRL) 1256/2020] in the High Court of Delhi by a single bench consisting of JUSTICE SURESH KUMAR KAIT. Facts are that the petitioner herein is a Non- Banking Financial Company, registered with the RBI and also a financial institution under the SARFAESI Act. An order/notice was issued against the petitioner by the office of the Offences Wing, New Delhi to the Sub-Registrar-IIA, Punjabi Bagh, Nangloi, Delhi under section 102 of the Code of Criminal Procedure, 1973. The writ has been filed against the same. The counsel for the petitioner submits that the impugned order is in direct contravention of Section 102 Cr.P.C. as the said provision does not grant any power for the seizure of immovable properties and same is against law and deserves to be set aside.   The learned ASC that the notice issued is not against the overall spirit of the judgement of the Hon’ble Supreme Court in Nevada Properties Private Limited vs. State of Maharashtra. The court made reference to the judgement of Apex court in Nevada Properties Private Limited vs. State of Maharashtra., wherein it was observed that “Section 102 postulates seizure of the property. Immovable property cannot, in its strict sense, be seized, though documents of title, etc. relating to immovable property can be seized, taken into custody and produced. Immovable property can be attached and also locked/sealed. It could be argued that the word ‘seize’ would include such action of attachment and sealing. Seizure of immovable property in this sense and manner would in law require dispossession of the person in occupation/possession of the immovable property, unless there are no claimants, which would be rare. Language of Section 102 of the Code does not support the interpretation that the police officer has the power to dispossess a person in occupation and take possession of an immovable property in order to seize it”. The court also made reference to section 102 of Cr. P.C, wherein it is stated that “Power of police officer to seize certain property. -(1) Any police officer, may seize any property which may be alleged or suspected to have been stolen, or which may be found under circumstances which create suspicion of the commission of any offence.”.