Supreme Court: In a set of two criminal appeals against a decision of the Madras High Court, wherein the de-freezing of the accounts of the accused persons was allowed for delay on the part of the police in reporting the seizure to the jurisdictional Magistrate, the Division Bench of Pamidighantam Sri Narasimha and Aravind Kumar*, JJ. while dealing with the question that whether delayed reporting of the seizure to the Magistrate vitiate the seizure order altogether, held that non-reporting of the seizure forthwith by the police officer to the jurisdictional Court would not vitiate the seizure order.
The Court noted that there are two views taken by the High Courts while answering this question, one set of cases holding that delayed reporting to the Magistrate would, ipso facto, vitiate the seizure order; and the other being that, delayed reporting would constitute a mere irregularity and would not vitiate the seizure order.
Legislative History
The Court traced the legislative history of the responsibility of the police officer to promptly inform the Magistrate about the seizure under the Code of Criminal Procedure from 1882 to 2023 and said that the said provision was absent in the 1898 Code, however, it was provided that if the seizing officer was below the rank of an officer-in charge of a police station, then such officer was under a duty to give information to his superior regarding the seized property. the Court noted that the provision as it existed in the 1898 Code was retained as is in the Code of Criminal Procedure, 1973 (‘CrPC 1973’). Sub-section (3) to Section 102 was inserted by way of an amendment only in the year 1978 which reintroduced the reporting obligations of police officer to the Magistrate, as it originally existed in the 1882 Code. It also empowered the seizing officer to give custody of the seized property to any person, on such person executing a bond undertaking to produce the property before the Court as and when required. The Court also pointed that Section 102 of the CrPC 1973 in its present form has been retained as is in the Bharatiya Nagarik Suraksha Sanhita, 2023 which is scheduled to come into force on 01-07-2024 and replace the CrPC 1973.
Reason for insertion of sub-section 3 to Section 102 of the CrPC, 1973
Further, the Court analysed the 1978 amendment which inserted Section 102(3) in the CrPC, 1973 and said that the reason cited for inserting the amendment was to overcome a ‘lacuna’ in the law. Understanding this ‘lacuna’ the Court perused Section 457 and 459 of the CrPC, 1973 which sets out the procedure to be followed by police upon seizure of the property and empowers the Magistrate with the power to auction/sell seized property in certain situations, respectively. The Court clarified that both, the Sections contemplates the act of seizure by police to be reported to the Magistrate so that necessary steps could be taken for its custody and disposal. However, Section 102(1) of the CrPC, 1973 which conferred substantive powers on the police to seize property of a crime, did not impose on such officers a consequent duty to report the seizures made to the Magistrate. Since the relevant provisions in the 1898 Code and the CrPC 1973 provided only for the substantive power to seize and did not impose any duty on such seizing officer to report to the Magistrate, there arose a need for amendment.
Whether validity of the seizure order is contingent on compliance with the reporting obligation?
The Court viewed that the validity of the power exercised under Section 102(1) of the CrPC, 1973 is not dependent on the compliance with the duty prescribed on the police officer under Section 102(3) of the CrPC, 1973. The validity of the exercise of power under Section 102(1) of the CrPC, 1973 can be questioned either on jurisdictional grounds or on the merits of the matter. The Court reiterated that, the order of seizure can be challenged on the ground that the seizing officer lacking jurisdiction to act under Section 102(1) of the CrPC or that the seized item did not satisfy the definition of ‘property’ or on the ground that the seized property did not give rise to suspicion concerning the commission of a crime, in order for the authorities to justify the seizure. Further, the Court reiterate that the pre-requisite for exercising powers under Section 102(1) is the existence of a direct link between the tainted property and the alleged offence. It is essential that the properties sought to be seized under Section 102(1) of the CrPC, 1973 must have a direct or close link with the commission of offence in question. The Court stated that, “the obligation to report the seizure to the Magistrate is neither a jurisdictional pre-requisite for exercising the power to seize nor is the exercise of such power made subject to compliance with the reporting obligation”. However, on perusal of Section 105-E of the CrPC, 1973, the Court said that for the order of seizure to take effect and have legal force, it must be confirmed by the Court and only upon passing of the confirmation order within the stipulated period does the order of seizure take effect. Until then, it remains an order in form but without having any legal force.
The Court reiterated that, unless serious prejudice is demonstrated to have been suffered as against the accused, mere delay in sending the FIR to the Magistrate by itself will not have any deteriorating effect on the case of the prosecution. Further, the Court recapitulated that if prejudice is demonstrated and the prosecution fails to explain the delay, then, at best, the effect of such delay would only be to render the date and time of lodging FIR suspect and nothing more. Relying on the said analogy, the Court added that the delay in reporting the seizure to the Magistrate may, subject to proof of prejudice, at best, dent the veracity of the prosecution case vis-à-vis the date, time and occasion for seizure of the property. Since the proof of prejudice on part of the accused and the explanation for delay on part of the prosecution can only be demonstrated at trial, the effect of non-compliance becomes an issue to be adjudicated at the time of appreciation of evidence.
Therefore, the Court held that, the line of precedents which took the position that ‘seizure orders’ are vitiated for delay in compliance with the reporting obligation to the Magistrate are erroneous and hence, are accordingly, overruled.
However, the Court clarified that there is an obligation on the police officer to report the seizure forthwith, and the expression ‘shall forthwith report the seizure to the Magistrate’ under Section 102(3) is to be examined. The Court on referring to settled authorities and definition under law dictionaries said that ‘forthwith’ means ‘as soon as may be’, ‘with reasonable speed and expedition’, ‘with a sense of urgency’, and ‘without any unnecessary delay’. In other words, it would mean as soon as possible, judged in the context of the object sought to be achieved or accomplished.
Present Appeals
The accused persons/ respondents placed an order for purchase of forty-seven Kerala Model Gold Chains from the appellant/ informant. In consideration for the supply of gold chains, the accused persons had agreed to provide gold bars of equivalent value, however, it was alleged that the gold bars handed over to informant were fake. During the investigation, it was noticed that certain monies to the tune of Rs.19,83,036/- were deposited in the bank accounts of accused persons. On investigating officer’s application, the freezing of bank accounts was ordered. The accused persons sought for de-freezing of the bank accounts and the High Court vide the impugned order allowed the application for de-freezing of the bank accounts, and therefore set at naught the seizure order on the sole ground that the order of seizure was not forthwith reported to the Magistrate.
The Court held that the High Court’s view was not sustainable. However, regarding the question of de-freezing of the accounts, the Court refused to direct the same and in the interest of justice, directed the accused persons to execute a bond undertaking to deposit the amount (which has been thus far withdrawn from the seized bank accounts) before the jurisdictional Court in the event the Court were to return a finding of guilt against the accused persons.
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