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IN THE HIGH COURT OF KERALA AT ERNAKULAM
THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR
State Of Kerala Rep. By The Public Prosecutor – Petitioner
Versus
Nishad - Respondent
Crl.Appeal No. 1321 Of 2023
Decided On : 17-07-2024
BUDS Act - Banning of Unregulated Deposit Schemes - Sections 14, 15(3) - The court discussed the provisions of the BUDS Act, particularly Section 14, which mandates timely confirmation of attachment and sale of properties involved in unregulated deposit schemes. The court emphasized the need for expeditious handling of seized assets to prevent decay and misuse, referencing the Supreme Court's guidelines on the custody and disposal of seized vehicles. The interpretation of these provisions influenced the court's decision to allow the sale of the vehicle, prioritizing the rights of victims over the accused's claims.
Fact of the Case:
The State appealed against the Designated Court's dismissal of a petition under Section 14 of the BUDS Act, which sought confirmation of the attachment and permission to sell a car provisionally attached due to its alleged purchase with proceeds from unregulated deposit schemes.
Finding of the Court:
The court found that the Designated Court had erred in retaining the vehicle until the trial was complete, disregarding the Supreme Court's directives on the timely disposal of seized vehicles. The court determined that the attachment of the vehicle was justified and that the sale could proceed without prejudice to the trial.
Issues: Whether the Designated Court was correct in denying the request for confirmation of attachment and permission to sell the vehicle pending trial, and whether the provisions of the BUDS Act allow for the sale of attached properties before the conclusion of the trial.
Ratio Decidendi: The court held that the BUDS Act prioritizes the realization of assets for the benefit of victims and does not require the completion of a trial before allowing the sale of attached properties. The court also reiterated the importance of following the Supreme Court's guidelines regarding the custody and disposal of seized vehicles.
Final Decision: The appeal was allowed, the attachment of the car was made absolute, and the Competent Authority was granted permission to sell the vehicle in public auction, with the requirement to prepare an inventory and take photographs for trial purposes.
Based on the provided legal document, the key points are as follows:
The Banning of Unregulated Deposit Schemes (BUDS) Act emphasizes the importance of timely confirmation of attachment and sale of properties involved in unregulated deposit schemes to protect victims' interests and prevent asset decay, regardless of the status of the trial (!) (!) .
The case involved the State appealing against the decision of the Designated Court, which had dismissed a petition under Section 14 of the BUDS Act seeking confirmation of attachment and permission to sell a vehicle that was provisionally attached due to its purchase with proceeds from unregulated deposit schemes (!) (!) .
The court found that the Designated Court erred in retaining the vehicle until the completion of the trial, disregarding the directives that prioritize the expeditious disposal of seized assets for the benefit of victims and the integrity of the investigation (!) (!) .
The court highlighted the importance of following guidelines for the custody and disposal of seized vehicles, including preparing detailed inventories, photographs, and security bonds, to facilitate proper evidence preservation and to prevent natural decay or theft of valuable parts (!) (!) (!) .
The court emphasized that the scheme of the BUDS Act allows for the sale of attached properties before the conclusion of the trial, with the primary goal of asset realization for victims, and that the pendency of investigation or trial should not prevent such sale (!) (!) .
The court approved the confirmation of the attachment of the vehicle and authorized its sale in a public auction, with the stipulation that the sale proceeds be utilized strictly in accordance with law, and that an inventory and photographs be prepared for trial purposes (!) .
The appeal was allowed, and the order to retain the vehicle pending trial was set aside, aligning with the principles of expeditious asset disposal and safeguarding the rights of victims under the relevant provisions of the BUDS Act (!) .
These points reflect the court’s reasoning and decision to prioritize the prompt sale of attached assets to serve justice and victim interests, in accordance with statutory provisions and judicial guidelines.
JUDGMENT :
THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR
The State is the appellant. The appeal is filed under Section 19 of the Banning of Unregulated Deposit Schemes Act (BUDS Act), 2019. Grievance of the appellant is that the designated court dismissed the petition filed under Section 14 of the BUDS Act seeking confirmation of the attachment and permission to sell the car bearing Reg.No.KL-71-H-444, which was provisionally attached by the Competent Authority.
2. Notice was served on the respondent through WhatsApp and also through his brother. The respondent did not choose to appear before this Court. Since there is due service of notice and no delay can be afforded since the matter is concerning permission to sell a motor vehicle, I proceed to dispose of the matter.
3. Heard the learned Public Prosecutor.
4. Crime No.155/CB/MPM/21 was registered as a sequel to Crime No.356/2020 of Pookkottumpadam Police Station. The Deputy Superintendent of Police-II, Crime Branch, Malappuram, is investigating the matter. The offences alleged against the respondent, who is the accused, are punishable under Section 3 read with Sections 4, 5(c), (i), (iii) of Prize Chits and Money Circulation Schemes (Banning) Act, 1978 and Section 3 read with Sections 21(1), (2) & 5 read with Section 23 of the Banning of Unregulated Deposit Schemes Act, 2019. The allegations are that the petitioner utilising the money garnered by committing offences of conducting unauthorised deposit schemes purchased the car bearing Reg. No.KL-71-H-444. The Competent Authority under the BUDS Act after considering the request of the Investigating Officer and materials concerning crime No.155/CB/MPM/21 ordered provisional attachment of the said vehicle.
5. Following the attachment, the car was produced before the court. The vehicle was entrusted with the investigating officer for interim custody. The Competent Authority thereafter submitted Crl.M.C.No.1936 of 2022 before the Designated Court, invoking the provisions of Section 14 of the BUDS Act, seeking confirmation of the attachment and permission to sell the vehicle. The Designated Court declined the request. The reasons thereof are stated in Paragraph No.4 of the order, which is extracted below:
6. The Apex Court in Sunder Bhai Ambalal Desai and others v. State of Gujarat [(2002) 10 SCC 283] issued directions in regard to the custody and disposal of motor vehicles seized by the police during investigation or otherwise. It was held,-
1. Owner of the article would not suffer because of its remaining unused or by its misappropriation;
2. Court or the police would not be required to keep the art
The BUDS Act allows for the timely confirmation of attachment and sale of properties involved in unregulated deposit schemes, emphasizing the need to protect victims' interests and prevent asset deca....
Section 5 reads wrongful inducement in relation to Unregulated Deposit Schemes.
The provisions of Section 14(1) of the BUDS Act exclude the application of Section 5 of the Limitation Act, meaning that any delay in filing for confirmation of attachment beyond the specified period....
Section 18(c) of the Act confers upon the Designated Court an independent power to order the taking of possession and disposal of assets to recover deposits, which is not conditional upon the prior a....
An owner claiming innocence can request release of a seized vehicle under NDPS Act, provided they prove lack of knowledge about its illegal use, subject to security conditions.
Release of vehicle - It is of no use to keep such seized vehicles at police stations for a long period. It is for Magistrate to pass appropriate orders immediately by taking appropriate bond and guar....
Uninsured vehicles involved in accidents cannot be released without sufficient security to cover potential compensation claims, protecting victim rights.
Release of vehicle - It is of no use to keep such seized vehicles at police stations for a long period. It is for Magistrate to pass appropriate orders immediately by taking appropriate bond and guar....
The court ruled that a vehicle seized under the NDPS Act can be released on interim custody unless the owner is implicated in the unlawful use, affirming the application of Sections 451 and 457 of th....
The court established the principle that the trial court has the power to release a seized vehicle to the registered owner in interim custody, citing the absence of a provision in the NDPS Act restri....
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