Frame guidelines on pledging, release of stolen gold: Karnataka High Court to law panel
BENGALURU: In view of innumerable cases involving ascertainment of ownership of pledged stolen gold with finance companies coming before court, the Karnataka High Court requested the State Law Commission to look into the matter and formulate necessary guidelines.
Justice Suraj Govindraj passed the order while disposing of the petition filed by Muthoot Finance Limited, questioning alleged interference with their business by Begur police, by seizing gold articles pledged by customers.
“The 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 from the owner. The finance company is vested with a duty to carry out due diligence before accepting the gold as a pledge for a loan,” the court observed.
The investigation officer would be required to ascertain various aspects, including ownership of the pledged gold, and it is for court to decide in whose favour the gold has to be returned, if an application under Section 500 of the BNSS were to be filed. Of course, the petitioner can always place rights and claims before the court, the order said.
The court pointed out that a number of cases before it pertain to stolen gold pledged with a gold finance company. Therefore, this aspect would have to be examined by the authorities and proper guidelines formulated on ascertainment of ownership, identity of the person pledging gold, implication of pledging stolen gold, dealing with such gold when criminal proceedings are taken up, etc. The Law Commission has to look into it and formulate guidelines, the court said.
The HC directed the petitioner to cooperate with the investigating officer and make available all details relating to the pledge, and also permit inspection of the gold, which if required the investigating officer can take a receipt of and deposit with the court.
On coming to the conclusion that the gold is stolen, the police officer cannot retain the gold in his possession, but would have to deposit it with the court seized of the matter. The court, while considering an application for release of the gold, would have to issue notice to the petitioner before passing the order, the court said.