The main legal point established in the judgment is that an agreement secured on the basis of fraud and misrepresentation is void under section 24 of the Contract Act, and therefore, the party cannot refuse to obey a notice issued by the police under the Criminal Procedure Code.

ORDER : – Petitioner has filed this writ petition under Article 226 of the Constitution of India making a prayer for quashing of impugned notice dated 29-9-2022 contained in Annexure-P/4.

2. Station House Officer, Police Station-Arera Hills, Bhopal has issued a notice to petitioner-company stating therein that one Deepak Sharma on 12-7-2022 had committed theft of gold jewellery belonging to Rajshri Jewelers. Said jewellery was having hallmark of RSJ. List of jewellery was given to petitioner-company. Notice was given to seize aforesaid jewellery by police as it is subject matter of Crime No. 347/2022 registered at police station-Arera Hills, Bhopal.

3. Learned counsel appearing for petitioner submitted that accused has pledged gold jewellery and petitioner-company had given loan on the pledged jewellery. Company had all requisite permission from Reserve Bank of India to act as non-banking finance company. All necessary legal formalities were completed in accordance with law before loan transaction. Petitioner-company had acted bona fidely. Since, there is no fault of petitioner-company, therefore it may not be allowed to suffer wrongful loss. Company has completed KYC formalities and has taken PAN Card, Adhar Card from Deepak Sharma and obtained his declaration regarding ownership of gold. According to agreement between accused Deepak Sharma and company, petitioner-company has power and authority to sell the gold in auction in event of default and non-payment of loan disbursed. It is submitted that even in cases of dispute loan is to be repaid back by the borrower. It is further submitted that in identical cases, Apex Court has granted stay over notice issued under section 102 of the Criminal Procedure Code vide order dated 12-3-2022. Similar interim orders have been passed in W. P. Nos. 18633/2022, 13370/2022, 8515/2022. In these circumstances, impugned notice which has been issued by police station-Arera Hills, Bhopal be quashed.

4. Learned counsel appearing for respondents and Government Advocate appearing for State made a prayer for dismissal of writ petition. It is submitted by them that gold in question which is pledged in bank is subject-matter of crime, therefore, petitioner-company cannot retain the said articles on basis of agreement between company and accused. Petitioner may have authorization or permission from Reserve Bank of India to do business of non-banking finance company but same will not deprive prosecution from issuing notice to petitioner-company for formal seizure of articles of theft. No benefit can be given to company on basis of contract entered between petitioner and accused-Deepak Sharma. Notice issued by police station is in accordance with law and, therefore, writ petition may be dismissed.

5. Heard the counsel for the parties.

6. Section 102 (1) of the Code of Criminal Procedure is quoted as under: –

“102. Power of police officer to seize certain property. – (1) Any police officer, may seize any property which may be alleged or suspected to have been stolen, or which may be found under circumstances which create suspicion of the commission of any offence.”

Section 102 gives power to Police Officer to seize any property which may be alleged or suspected to have been stolen or which may be found under circumstance which creates suspicion of commission of any offence.

7. In this case, gold which is pledged with petitioner-company is stolen articles and had been pledged with the bank. Accused-Deepak Sharma had committed fraud with the bank by giving false declaration that he is owner of property in question. Said accused person has also cheated petitioner-company by inducing them to believe that property in question belongs to him and on said belief company transferred the money to accused. Accused has not only committed theft of jewellery from Rajshri Jewelers but had also committed offence of forgery and cheating with petitioner-company. Petitioner-company has remedy to take criminal as well as ci