Kanhikulam Service Co-Operative Bank Ltd. v. State of Kerala

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT** **THE HONOURABLE MR. JUSTICE K.HARIPAL** **MONDAY, THE 7[TH] DAY OF MARCH 2022 / 16TH PHALGUNA, 1943** **CRL.MC NO. 2593 OF 2021** **CRL.M. P. NO. 15/2020 IN SC NO. 319/2012 OF ASSISTANT SESSIONS** **JUDGE (ADDL.), PALAKKAD** **CRIME NO. 30/2007 OF KONGAD POLICE STATION, PALAKKAD** ## **PETITIONER/PETITIONER :** **KANHIKULAM SERVICE CO-OPERATIVE BANK LTD. NO.F.1086, EZHAKKAD BRANCH, PALAKKAD DISTRICT. REP. BY ITS BRANCH MANAGER, KARUNAKARAN, S/O.P.K.BALAKRISHNAMENON, KUNNATHUKALAM, KADAMBAZHIPPURAM, PALAKKAD.** **BY ADV. V.A.JOHNSON (VARIKKAPPALLIL)** ## **RESPONDENT/RESPONDENT & COMPLAINANT:** **STATE OF KERALA REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM - 682 031.** **BY SRI. HRITHWIK C.S., SENIOR PUBLIC PROSECUTOR** **THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 21.12.2021, THE COURT ON 07.03.2022 PASSED THE FOLLOWING:** Crl.M.C.No.2593 OF 2021 2 ## **ORDER** Petitioner is the Branch Manager of Kanhikulam Service Co-operative Bank Ltd. No. F 1086, Ezhakkad branch in Palakkad district. At the instance of the petitioner, Crime No. 30/2007 of Kongad police station was registered alleging offences under Sections 395, 457, 461, 412, 216-A, 52-A and Section 401 of the Indian Penal Code. As the provisions indicate that crime was registered after a big robbery committed in the co-operative bank. After completion of investigation, charge sheet has been laid against 26 accused persons for having robbed 44,694.85 gms of gold ornaments and cash worth Rs.2,38,148/-. Out of the 26 accused, only A23, A24 and A25 have faced trial who were acquitted; case against A8 and A26 is refiled as S.C. No. 542/2018 and others are absconding. Case against A1 to A7, A9 to A22 is not yet committed. The subject matter of robbery are the properties of customers of the bank who had pledged gold ornaments. The incident had happened in 2007. The liabilities of the customers have been settled by the bank. The petitioner had filed an application under Section 451 of the Cr.P.C. before the Judicial Crl.M.C.No.2593 OF 2021 3 First Class Magistrate – II, Palakkad and the items were returned to their interim custody on the following conditions:- - “1. The petitioner shall produce the said valuable as and when directed before the court or before any authority as directed by the court. 2. The bank shall not alter the present condition of any of the property without prior sanction of the court. 3. Petitioner shall execute a bond for Rs. 1.5 crore with two solvent sureties each for the like sum undertaking to abide by the said conditions. 4. The two sureties shall be from the present Board of Directors. 5. The petitioner himself shall satisfy the genuinity of the article by getting assistance from a qualified appraiser in the presence of the Magistrate.” 2. In order to lift condition Nos. 1 and 2, the petitioner moved the Assistant Sessions Court, Palakkad. But by Annexure A order dated 14.09.2020, the Assistant Sessions Judge dismissed the application and aggrieved by the same, the petitioner has moved this Court under Section 482 of the Code of Criminal Procedure. 3. I heard the learned counsel for the petitioner and also the learned Senior Public Prosecutor. 4. The learned Senior Public Prosecutor who represented the State also said that the bank is the ultimate loser, the bank has Crl.M.C.No.2593 OF 2021 4 already settled liabilities of the customers. That means the respondent also does not support the order in question. 5. Relying on the decision reported in **Nagarajan v. State of Kerala [2019 (5) KHC 666],** the learned counsel submitted that even though the Assistant Sessions Judge had relied on this decision, the discretion has not been properly exercised. The court failed to note that the bank had settled the matter with the customers, that huge amounts are due from the bank to the financial institution. In fact, it was availing huge financial liabilities, that the liabilities of the customers were settled. Therefore, if the gold is kept idle for long, the bank will sustain further loss. Therefore, he wanted the order to be set aside. 7. As adverted to earlier, the gold ornaments weighing to 44,694.85 gms was given to the interim custody of the petitioner with certain conditions quoted supra. The petitioners are aggrieved by condition Nos. 1 and 2. As rightly pointed out by the learned counsel for the petitioner, if such conditions are allowed to sustain, the bank may not be able to make use of the gold ornaments till the termination of the entire proceedings. The question posed for consideration is whether there is justification in imposing such Crl.M.C.No.2593 OF 2021 5 conditions by the court and whether such conditions should be in vogue till the termination of the proceedings. After considering rival contentions and materials, I have no doubt that such conditions should not be in place until further orders. 8. Firstly, it is evident that it was a big robbery committed at the bank, consequently large quantity of gold pledged by customers were taken away by robbers/miscreants, 44,694.85 gms of gold ornaments were lost. There are 26 accused persons in the crime. The incident had happened way back in 2007, more than 15 years before. But so far, only three persons, accused Nos. 23, 24 and 25 faced trial. Others are at large. The case against A8 and A26 was refiled, they were absconding and case against A1 to A7, A9 to A22 are yet to be committed. In other words, it is highly uncertain as to when the proceedings would come to an end. If these conditions are allowed to subsist till the proceedings against all accused come to a logical conclusion, the bank would continue to lose towards payment of interest to the financier. In fact, it is public money that is involved and allowing the conditions to subsist is against public interest. 9. Secondly and more importantly, documents do not Crl.M.C.No.2593 OF 2021 6 suggest that there is any rival claimant, at least for the interim custody of the items. The accused persons are thieves who had committed house breaking and robbery. It cannot be thought that they would come forward staking claim for the custody of the items. Except three, none has even faced trial. Most of them are still at large. Some of them have gone absconding. They will not dare to stake claim over the items. 10. Thirdly, the items seem to be are in the form of nuggets. That means, the items were recovered by the police in the form of ingots, even if the items are kept until the termination of the proceedings, the real owners of the property who had pledged the items with the bank, may not be able to identify their gold ornaments which has transformed into ingots. 11. Moreover, as rightly pointed out by the learned Senior Public Prosecutor, the petitioner is the victim of a huge robbery; unable to with-stand the public pressure, by availing financial assistance have settled the claims of the customers and therefore, day by day, they are suffering loss by way of payment of interest to their financier. Therefore, it is not in public interest to allow the gold to be kept idle indefinitely. As rightly pointed out by the Crl.M.C.No.2593 OF 2021 7 learned counsel for the petitioner, the learned Assistant Sessions Judge did not exercise the discretion properly and I am of the view that the order is liable to be interfered with. 12. In this connection, I have also come across the decision of a Division Bench of this Court in **Suresh Serve v. State of Kerala [2020 (3) KLT 395]** . In similar circumstances, the matter was referred to the Bench and the specific question referred for consideration was whether or not gold ornaments and money could be released in interim custody under Section 451 of the Cr.P.C. to a person claiming to be the owner of jewellery/money without incorporating a condition that the said articles should be produced before the court, as and when directed, exactly in the same condition as they were at the time of entrustment. Answering the reference, the court considered various authorities of the Hon'ble Supreme Court as well as of this Court. Referring to the oft quoted decision of the Supreme Court in **Sunderbhai Ambalal Desai v. State of Gujarat [2003 (2) KLT 1089 (SC)]** , the court held that in such cases apart from following the guidelines in the **Sunderbhai Ambalal Desai** 's case, it is appropriate to frame additional points in respect of disposal of money and jewellery by invoking Section Crl.M.C.No.2593 OF 2021 8 451 of the Cr.P.C. The court clarified that the additional points shown are intended to supplement the guidelines in **Sunderbhai Ambalal Desai** 's case and not to supplant them. It would be apposite to quote the third guideline as shown below:- - “(iii) In the case of jewellery, apart from the preparation of a proper panchanama of the articles, taking photographs, etc., mandated in Sunderbhai Ambalal Desai's case, following aspects also may be considered depending on the facts in each case: xxxxxx - (b) In a case involving theft of huge quantity of gold ornaments from a jewellery store or from a jewellery manufacturing unit, the court should take extra precautions to see whether the claimant has established, by cogent evidence, a strong prima facie case to show his entitlement for staking the claim. In such cases, there ought to be records to support his claim. If there are sufficient documentary evidence showing his unquestionable entitlement to the articles, especially in a case where there is no rival claimant for the jewellery, we find no reason for imposing a condition that the entire jewellery shall be produced in the same condition, as and when directed. If it is established by evidence that the ornaments claimed by him are stock in trade in the jewellery store, no earthly purpose will be served by returning them to the claimant by Crl.M.C.No.2593 OF 2021 9 imposing such restrictions. Hence, such a condition need not be imposed in all cases, disregarding the factual situation in each case.” 13. I have no doubt that it is appropriate that these guidelines have to be followed in this case. As indicated earlier, large quantity of gold ornaments were robbed from the bank which were pledged by the customers, the items were recovered in the form of nuggets and produced before court and were returned to the petitioner by imposing such conditions. The bank has settled all the claims of the customers. They have availed financial assistance from other financial institutions for the purpose of settling the claims. Thus, day by day, they are sustaining loss. Even though there are 26 accused persons most of them are still at large. 14. In the circumstances, in my view, it is idle to keep the gold ornaments in the interim custody of the petitioner imposing such conditions. The learned Assistant Sessions Judge has passed the impugned order without considering all relevant aspects. Therefore, Annexure A order is liable to be quashed and I do so. 15. At the same time, there are certain aspects, which have to be taken into consideration before lifting the conditions. Even though there are reasons to think that there are no rival claimants, that can be verified only after going through all the records. Moreover, the Crl.M.C.No.2593 OF 2021 10 entitlement of the petitioner to get the custody of the items absolutely also has to be ascertained from the records, which are available in the trial court. Therefore, the matter is remitted to the trial court for fresh consideration bearing in mind the various aspects noticed above. The Crl.M.C. is allowed as above and the matter is remitted to the trial court and the trial court is directed to consider and dispose of Crl.M.P. No. 15/2020 afresh within a period of two months from the date of receipt of a copy of this order. **SD/K.HARIPAL JUDGE** **DCS/03.03.2022** Crl.M.C.No.2593 OF 2021 11 ## **APPENDIX** ## **PETITIONER'S ANNEXURE** **ANNEXURE A CERTIFIED COPY OF THE ORDER DATED 14/09/2020 IN CRL.M.P.NO.15/2020 PASSED BY THE COURT OF THE ASSISTANT SESSIONS JUDGE (ADDL.), PALAKKAD IN S.C.NO.319/2012 IN CRIME NO.30/2007 OF KONGAD POLICE STATION, PALAKKAD.** **ANNEXURE B COPY OF THE CITATION IN 'NAGARAJAN VS. STATE OF KERALA REPORTED IN 2019(5) KHC 666.**