( 1 ) WHAT is stolen property or property fraudulently obtained? Is it open to a Magistrate to direct that the muddamal property alleged to be stolen and/or fraudulently obtained be handed over to the person from whose custody it has been seized even when the police submits that the investigation is in progress and the same is not completed ? At any rate would it be proper for the learned Magistrate to resort to the provisions of Section 457 of the Criminal Procedure Code and order to hand over the muddamal property i. e. currency notes to the tune of Rs. 2 70 0 (Rupees two lakhs and seventy thou sand only) seized from the person at the interim stage even though he does not claim that the property belonged to him and that he has lawfully obtained the same ? The aforesaid questions arise in the background of the following facts:

( 2 ) THAT on September 23 1983 at about 10. 35 a. m. opponent No. 1 got down from Saurashtra Janata Express at Rajkot railway station. On suspicion he was detained by the Railway Police. His person and other belongings with him were searched. It was found that he was in possession of currency notes to the tune of Rs. 2 70 0 (Rupees Two lakhs and Seventy thousand only ). Therefore he was detained under the provisions of Section 41 (d) of the Criminal Procedure Code. In accordance with law the police took possession of the currency notes and certain other articles found from opponent No. 1

( 3 ) ON the same day the police informed the Income Tax Authorities about the seizure of currency notes from opponent No. 1. The Income Tax Authorities under the relevant provisions of Income Tax Act requested the Railway Police that the amount in question may not be released without consultation of the Income Tax Officer Ward H Circle II Rajkot. The Income Tax Authorities recorded the statement of opponent No. 1 on September 23 1983 and were further investigating the matter.

( 4 ) MEANWHILE it so happened that on September 26 1983 opponent No. 1 submitted an application before the learned JMFC (Railways) Rajkot. By this application he submitted that he was detained under the provisions of Section 41 (d) of the Criminal Procedure Code. But the said provision empowers the police only to detain a person and it is not an offence. There is no allegation against him of having committed any offence. At this stage the police was not even in a position to point out as to for what offence he was detained. Therefore he prayed that since the currency notes were seized from his possession and there was nothing to connect the same with any offence whatsoever the police should be directed to return the same to him.

( 5 ) AFTER hearing the parties the learned Magistrate by his order dated October 13 1983 directed the Railway Police to hand over the currency notes the muddamal property of Rs. 2 70 0 to opponent No. 1 on the condition that he should produce the muddamal property as and when it is so directed by the Court and on the further condition that opponent No. 1 should furnish two sureties one each for Rs. 1 35 0 and also furnish a bond in the same amount.

( 6 ) IT may be noted that opponent No. 1 did not disclose before the Court that in respect of this very amount he was interrogated by the Income Tax Department and that the proceedings initiated by the Income Tax Department were in progress. This fact was not brought to the notice of the Court even by the learned Asst. Public Prosecutor who appeared on behalf of the State. When the Income Tax Authorities again approached the Railway Police for taking possession of the muddmal property (the currency notes) the police expressed its inability to hand over the property in view of the order passed by the learned Magistrate (Railway) Rajkot. Thereupon the Union of India through Income Tax Officer Rajkot filed a revision application being Criminal Revision Application No. 90 of 1983 on November 15 1983 in the Court of Sessions Judge Rajkot District Rajkot.

( 7 ) WHEN