Custodial liability of a manager for leased hospital equipment is limited unless theft or misappropriation is established.

Raja Vijayaraghavan V, J.

This Writ Appeal is filed challenging the judgment dated 05.12.2025 in W.P.(Crl.) No. 1399 of 2025. By the above judgment, the learned Single has disposed of the petition filed by the 1st respondent herein by issuing directions to the Station House Officer to take over the hospital equipments, handed over to the 1st respondent by a Kaichit and to hand over the same to the original owner or to keep the same in safe custody by the police itself.

Short facts :

2. The records disclose that the appellant, Smt. Safreena T.K., is the owner of a hospital known as Mother’s Hospital. The hospital had been leased to the 4th respondent, Sri. A. Premarajan, under a valid lease agreement, and he was running the hospital. The 1st respondent herein, Smt. Daliya Grace A., was functioning as the Manager of the hospital during the relevant period. Certain disputes subsequently arose between the landlord and the tenant, culminating in the filing of RCP No. 28 of 2021 before the Rent Control Court, Hosdurg. The Rent Control Petition was allowed, and an order of eviction was passed against the tenant.

3. While execution proceedings were pending, the petitioner lodged a complaint before the Station House Officer, Hosdurg Police Station. On the basis of the said complaint, Crime No. 523 of 2023 of Hosdurg Police Station, Kasargod, was registered for offences punishable under Sections 406 and 380 r/w. Section 34 of the IPC. The allegation was that the tenant, Sri A. Premarajan, had dishonestly removed certain movable items from the hospital premises, thereby causing a loss of approximately ₹40,00,000 to the complainant.

4. During the course of investigation, the Investigating Officer visited the hospital and prepared a Kachit, under which the following items were entrusted to the 1st respondent on interim custody upon execution of Ext.P2 Kachit:

(1) Ultrasound Machine (2) Computer UPI Printer (3) MGB Laparoscopic System (4) ECG Machine (5) NICU Warmer (6) Phototherapy Machine The Kachit specifically records that the said equipment was essential for the functioning of the hospital and that the items should be produced as and when directed by the court.

5. Thereafter, the 1st respondent approached this Court by filing W.P.(Crl.) No. 1399 of 2025. Her grievance was that she was no longer willing to retain custody of the equipment covered by Ext.P2. She submitted Ext.P3 representation before the Station House Officer, requesting that the articles be taken back and produced before the jurisdictional court. Her complaint was that no action had been taken on the said representation.

6. When the matter came up for consideration, the learned Single Judge examined the report submitted by the Investigating Officer. The report indicated that steps had been initiated to take back the hospital equipment from the Manager and hand it over to the landlord. However, since an inspection by the Amin in connection with the execution proceedings before the Munsiff Court was underway, the Officer was not in a position to inspect the premises or retrieve the equipment at that stage. The report further stated that, upon completion of the inspection, the equipment could be taken back from the 1st respondent and dealt with appropriately. In light of the report, the learned Single Judge disposed of the Writ Petition, directing the Station House Officer to take back the equipment released under Ext.P2 Kachit and either hand it over to the landlord on a fresh Kachit or, in the alternative, keep it in safe police custody.

7. We have heard the learned counsel appearing for the petitioner as well as the party respondents. As contentions were raised concerning Ext.P2