{"id":338675,"date":"2025-01-08T17:00:29","date_gmt":"2025-01-08T11:30:29","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=338675"},"modified":"2025-01-15T10:39:03","modified_gmt":"2025-01-15T05:09:03","slug":"karnataka-law-commission-stolen-gold-pledge-guidelines-karnataka-hc-legal-news","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2025\/01\/08\/karnataka-law-commission-stolen-gold-pledge-guidelines-karnataka-hc-legal-news\/","title":{"rendered":"Karnataka HC urges State Law Commission to frame guidelines on issues surrounding pledging of stolen gold"},"content":{"rendered":"<div style=\"text-align: justify; line-height: 150%;\">\n<p style=\"margin-bottom: 3%;\"><span style=\"font-weight: bold;\">Karnataka High Court:<\/span> While considering the instant petition revolving around allegedly stolen gold articles that were pledged with the petitioner (Muthoot Finance); the bench of <span style=\"font-weight: bold;\">Suraj Govindraj, J*<\/span>., noted that innumerable matters are coming up before the Court where stolen gold had been pledged with a gold finance company. The Court opined that this aspect must be examined by the concerned authorities and proper guidelines must be formulated in relation to issues such as pledging of gold, ascertainment of ownership, identity of the person pledging the gold, implication of pledging stolen gold, manner of dealing with such gold when criminal proceedings are taken up etc.<\/p>\n<p style=\"margin-bottom: 3%;\">Therefore, the Court urged the Law Commission, Karnataka to investigate this matter and formulate necessary guidelines\/rules or the like as deemed fit.<\/p>\n<p style=\"margin-bottom: 3%;\">In the instant case, the petitioner knocked on the doors of the Court pleading that seizure of the gold pledged by its customers by the State Police, on the account that it was stolen, was arbitrary and violates fundamental rights guaranteed under Articles <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001574870\" target=\"_blank\">14<\/a> and <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001574926\" target=\"_blank\">19(1)(g)<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726967\" target=\"_blank\">Constitution<\/a>. Counsel for the petitioner submitted that there is a right vested on account of the pledge of the said gold as a security and that security cannot be taken away on the ground that the gold was stolen; the ownership of the gold would have to be established by the person claiming it by way of an appropriately instituted civil suit.<\/p>\n<p style=\"margin-bottom: 3%;\">Considering the petitioner&#8217;s prayer and submissions, the Court opined that the petitioner being only a pledgee\/ pawnee would have only the right that the pledgee\/pawnee has in the said gold and the petitioner cannot claim any right more than that.<\/p>\n<p style=\"margin-bottom: 3%;\">The Court stated that the <span style=\"font-weight: bold;\">true owner of the gold cannot be deprived of the use of the gold, merely because the same is pledged with a gold finance company after being stolen<\/span> from such true owner. The Gold Finance Company is vested with a duty to carry out proper due diligence before accepting the gold as a pledge for a loan disbursed.<\/p>\n<p style=\"margin-bottom: 3%;\">Taking note of the innumerable matters of similar nature coming before the Court, the Bench opined that there is a requirement of proper guidelines to address the concerned issues; hence the Court urged the State Law Commission to do the needful in this regard.<\/p>\n<p style=\"margin-bottom: 3%;\">[<span style=\"font-weight: bold; color: #632423;\">Muthoot Finance Ltd. v. State of Karnataka, <a href=\"http:\/\/www.scconline.com\/DocumentLink\/Gz04z2x8\" target=\"_blank\" rel=\"noopener\">2024 SCC OnLine Kar 2531<\/a>, decided on 31-12-2024<\/span>]<\/p>\n<p style=\"text-indent: 18pt;\"><strong><span style=\"color: #000080;\">*Order by Justice Suraj Govindraj<\/span><\/strong><\/p>\n<hr\/>\n<p>Advocates who appeared in this case:<\/p>\n<p style=\"margin-left: 18pt;\"><span style=\"font-weight: bold;\">Petitioner:<\/span> SRI. ANISH JOSE ANTONY., ADVOCATE<\/p>\n<p style=\"margin-left: 18pt;\"><span style=\"font-weight: bold;\">Respondent:<\/span> SRI. MOHAMMED JAFFAR SHAH., AGA<\/p>\n<h3 style=\"color: #000080;\">Buy Constitution of India &nbsp;<a href=\"https:\/\/www.ebcwebstore.com\/product\/the-constitution-of-india-coat-pocket-edition?products_id=100647\" target=\"_blank\">HERE<\/a><\/h3>\n<p style=\"margin-bottom: 3%;\"><a href=\"https:\/\/www.ebcwebstore.com\/product\/the-constitution-of-india-coat-pocket-edition?products_id=100647\" target=\"_blank\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/s3.amazonaws.com\/ebcwebstore\/images\/the-constitution-of-india-coat-pocket-edition-Gopal-Sankaranarayanan-ebc-front-cover.JPG\" alt=\"Constitution of India\" width=\"300\" height=\"200\" class=\"aligncenter size-large wp-image-294438\" \/><\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p style=\"font-style: italic;\">Court noted that innumerable matters are coming up where stolen gold had been pledged with a gold finance company and this aspect must be examined by the concerned authorities and proper guidelines must be formulated in relation to issues such as implication of pledging stolen gold, manner of dealing with such gold when criminal proceedings are taken up etc.<\/p>\n","protected":false},"author":3,"featured_media":316069,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[77331,77335,28334,77336,8091,77333,46539,77334,77332],"class_list":["post-338675","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-highcourts","tag-gold-articles","tag-justice-suraj-govindraj","tag-karnataka-high-court","tag-karnataka-law-commission","tag-muthoot-finance","tag-pawn","tag-pledge","tag-pledged-gold","tag-stolen-gold"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.4 (Yoast SEO v27.4) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ 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