Seized property remains custodia legis; Magistrate must determine the parties’ best entitlement to custody under Section 452.

The petitioner claimed ownership of a readymade steel hanger and accessories which he had allegedly given to respondent No. 1 on hire for the “NE Trade Expo” at Aizawl, Mizoram. Following damage to the structure during a storm, a dispute arose regarding compensation and possession. The petitioner alleged that respondent No. 1 forcibly retained and removed the materials, while respondent No. 1 claimed that he had purchased them from the petitioner

Both parties lodged criminal cases. In Dispur P.S. Case No. 1020/2015, the police seized the iron-frame structure weighing approximately 2,400 kg and handed its custody to respondent No. 1 under Section 102 Cr.P.C.

The Investigating Officer subsequently submitted a final report treating the dispute as civil in nature. After rejecting the informant’s prayer for further investigation, the learned Magistrate accepted the final report and rejected the petitioner’s zimma application on 25.05.2023, holding that both parties claimed ownership and that the question required a civil trial.

The petitioner challenged that order in the present criminal revision, contending that the Magistrate had failed to determine which party was better entitled to custody of the seized property and had effectively confirmed the police-granted custody in favour of respondent No. 1.

Whether, after acceptance of the final report and conclusion of the inquiry, the Magistrate was required to exercise jurisdiction under Section 452 Cr.P.C. regarding disposal or custody of the seized property?

Whether the Magistrate could reject the petitioner’s zimma application merely on the ground that the parties had rival ownership claims and that the dispute was civil in nature?

Whether the Magistrate was required to determine the party prima facie or comparatively better entitled to custody, rather than conclusively decide title or ownership?

The Court applied Section 102 Cr.P.C., under which the police may seize property suspected to be stolen or connected with an offence; under Section 102(3), where the property is not conveniently transportable or its continued police custody is unnecessary, custody may be given to a person on a bond to produce it before the Court and comply with further orders.

The Court held that such property continues to remain custodia legis, notwithstanding its physical release by the police.

The Court further applied Section 452 Cr.P.C., which empowers the Criminal Court, upon conclusion of an inquiry or trial, to pass appropriate orders for the disposal or delivery of property to the person claiming to be entitled to possession.

The governing principle was that the Magistrate need not finally determine ownership or title while deciding interim or consequential custody; the relevant inquiry is which claimant is better entitled to possession on the available materials.

The Court found that the final report had been accepted and the informant’s request for further investigation had been rejected, bringing the inquiry to an end and attracting consideration of Section 452 Cr.P.C.

Although the seized structure had been physically handed over to respondent No. 1, that release under Section 102(3) did not terminate the Court’s jurisdiction over the property, since the property remained subject to the Court’s further orders.

The Magistrate correctly recognized that both parties asserted ownership, but erred by treating the existence of a civil dispute as sufficient reason to reject the zimma application.

By doing so without assessing the competing materials or identifying the person better entitled to custody, the Magistrate effectively endorsed the police’s earlier custody arrangement and conferred an advantage on respondent No. 1 without proper judicial determination.

The order dated 25.05.2023 was accordingly set aside.

The Magistrate was directed to reconsider the zimma matter afresh on the basis of the materials submitted by both parties and to complete the exercise expeditiously, preferably within one month from receipt of the High Court’s order.

The criminal revision was disposed of accordingly.