The Supreme Court has clarified that the power of the courts to order an interim release of a seized material under the Cr.P.C / BNSS is not an adjudication of ownership, but a prima facie assessment of who is best entitled to possession.

“The exercise of this power requires the Court to make only a prima facie assessment of who is best entitled to possession, having regard to the nature of the property, the circumstances of seizure and the material placed before it. It does not comprise an adjudication of ownership, which falls generally within the exclusive domain of a competent civil forum.”, observed a bench of Justice Sanjay Karol and Justice Augustine George Masih.

The aforesaid clarification was made by the bench while hearing an appeal against the order of an interim release of the seized vehicles in favor of the Respondents, who were in actual possession and were using the vehicles while it was seized.

The dispute arose when the appellant alleged that on August 31, 2023, the respondents committed criminal trespass into his factory and forcefully took away the vehicles. A counter-FIR was lodged by the respondent company alleging that the appellant had misappropriated ₹1,73,11,894 from the company and utilized the amounts to purchase the vehicles in the name of his own company.

Both the Appellant and the Respondents filed separate applications before the trial court seeking return of vehicles; however, aggrieved by the dismissal of their application, they approached the Andhra Pradesh High Court. By way of a common order, the High Court granted interim custody of the vehicles to the Respondents. The High Court cited the pending criminal proceedings against the Appellant in an alleged misappropriation of funds case, and the continued use of the seized vehicles by the Respondents for their mining business operations when the vehicles were seized.

Aggrieved by the High Court's decision, the appellant moved to the Supreme Court.

While affirming the impugned findings, the Court used the occasion to clarify the scope of Sections 451 and 457 of the Code of Criminal Procedure. The judgment authored by Justice Karol said that these provisions empower courts to determine who is best entitled to interim possession of seized property without deciding questions of title or ownership.

"The language used in these provisions makes it clear that the Court is vested with the power to grant custody to whomsoever it deems fit i.e. the Court has the discretion to determine who is best entitled to possession of the property. The use of the words 'possession' and 'custody' emphasize that the Court does not adjudicate title but merely undertakes the exercise of granting interim possession, with the object of preventing decay and diminution in the value of the subject property."

Also From Judgment: S.457 CrPC | Registration Certificate Alone Not Sole Factor For Interim Release Of Seized Vehicles: Supreme Court

Headnote

Code of Criminal Procedure, 1973 (CrPC) — Sections 451 & 457 — Interim Custody of Vehicles — Registration Certificate vs. Actual Possession & Financial Undertaking - Interim custody under Sections 451 and 457 CrPC is not an adjudication of title, but a judicial mechanism to prevent decay and misuse of seized property - Registration Certificate (RC) is evidentiary and relevant, but cannot act as an inflexible or sole rule overriding admitted possession, ongoing operational control, and financial obligations borne by another party - The Supreme Court affirmed the High Court's order granting interim custody of the subject vehicles to the respondent company instead of the appellant/ostensible owner in whose company's name the vehicles were registered -The Supreme Court observed that while the registration certificates stood in the name of the appellant's company, criminal proceedings alleging misappropriation of company funds to purchase those vehicles were pending against him - the vehicles were seized from the operational site of the respondent company, the loan EMI instalments were paid from the respondent company's accounts, and an undertaking executed by the appellant permitted the respondent company to retain and operate the vehicles. [Paras 27, 30, 32–37]

Code of Criminal Procedure, 1973 (CrPC) — Sections 451 & 457 — Nature and Scope of Judicial Discretion - The power of the Court to order interim custody under Sections 451 and 457 CrPC is a judicial function to be exercised judiciously and expeditiously based on reason and justice - The Supreme Court makes only a prima facie assessment regarding who is best entitled to interim possession and does not adjudicate civil title or ownership. [Relied on N. Madhavan v. State of Kerala, (1979) 4 SCC 1; Paras 27-30, 32-38]

Cause Title: KRISHNAN NARAYANA VERSUS THE STATE OF ANDHRA PRADESH & ORS.

Citation : 2026 LiveLaw (SC) 724

Click here to download judgment