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Judgment
K.L. Manjunath, J.—Petitioners are brothers. 1st petitioner claims to be the proprietor of a business concern known as M/s Anur Glass & Plywood situated at M.B. Road, Kolar. According to them, they are carrying on business in Iron & Steel, Cement, paints, glass and plywood and other construction materials. 1st petitioner is a registered dealer under VAT Act as well as CST Act and he is assessed to income tax. Similarly, 2nd petitioner is running a similar business at Brahmin Street, Kolar under the name and style of Nagaraj Traders, he is also assessed to income tax and also registered dealer under VAT Act and CST Act. According to them, in the usual course of business, they are purchasing iron and steal from various re-rolling mills and also from other dealers throughout Karnataka. Similarly, petitioners were also purchasing steel from M/s Eshwar Trading Company of Tumkur and from 5.7.2007 till the date of filing the petition 1st petitioner had purchased steel in a sum of Rs.90 lacs spread over 20 transactions by making payments through bank and that the materials were dispatched by Eshwar Trading Company, Tumkur from the factory directly to the 1st petitioner. In the course of business, M/s Eshwar Trading Company said to have purchased certain materials from one M/s Goyal Ispat, Hubli to deliver goods directly to the petitioners and after receipt of goods payments were made to M/s Eshwar Trading Company in terms of the contract. It is stated that 1st petitioner is due in a sum of Rs. 26,556/- only to M/s Eshwar Trading Company.
R-2 on the ground that M/s Eshwar Trading Company did not make payment payable to it in respect of the transaction occurred between R-2 and M/s Eshwar Trading Company, a complaint was lodged on 21.10.2007 by its manager Vivekananda S. Pai stating that M/s Eshwar Trading Company has failed to pay the; value of 70 tonnes of steel as promised, therefore R-2 manager on 21.10.2007 lodged a complaint stating that the proprietor of Eshwar Trading Company is absconding and he has cheated R-2 in respect of the value of Rs.20 lacs, therefore, R-2 requested the Inspector of Police, Town Police Station, Tumkur to trace steel sold by R-2 and return the same or to get the value of the steel sold to M/s Eshwar Trading Company. A complaint was received by the Inspector, Town Police Station, Tumkur on 21.10.2007 at about 11 a.m., a case was registered in Cr. No. 106/2007 for the offences said to have committed u/s 406 and 420 of IPC.
Based on the above said complaint, Sub-Inspector of Police, Town Police Station, Tumkur, came to the business premises of the petitioners and they were taken to Town Police station and torturing them, materials available with the petitioners were taken by P-1 and thereafter materials seized from the petitioners have been released in favour of R-2 from the Court of Civil Judge (Sr. Dn.) Tumkur. Based on the complaint lodged by R-2 materials of the petitioners could not have been seized by R-1 and the act of R-1 in seizing the materials is contrary to the provisions of law as the petitioners are not recipients of any stolen property and that even R-2 has not stated that M/s Eshwar Trading Company has stolen steel from R-2 and that M/s Eshwar Trading Company in turn has delivered the steel to the petitioners as a stolen materials. According to the petitioners, by paying valuable sale consideration payable to the steel purchased by them by M/s Eshwar Trading Company and that R-1 could not have seized the material by torturing them. Therefore, petition is filed to declare the seizure of 70 tons of steel from the petitioners vide notification dated 26.10.2007 from R-2 in Cr. No. 106/2007 as illegal and to issue a direction to R-l either to surrender 70 tons of steel which was seized iron the petitioners or to pay the value of the same as on the date of seizure.
R-1 filed a counter denying the allegations made in the petition. According to R-1, on receipt of the complaint from R-2, an investigation was made and during investigation it was found that one R.V. Ramesh Babu of M/s Eshwar Trading Co. has sold 70 tons of steel which was seized from the petitioners during the course of investigation and the same has been produced in CC No. 23/2007 before CJM., Tumkur and it was contended by R-1 that he has seized the material in good faith. R-1 contends that writ petition filed by the petitioners is not maintainable. R-2 has also filed counter. According to R-2, writ petition is not maintainable and that an alternative remedy is available to the petitioners and the petitioners have to resort to the Code of Criminal Procedure if they are so aggrieved; therefore requested the court to dismiss the writ petition.
Having heard the counsel for the parties, this| court has to examine (1) Whether seizure of 70 tons of steel from the petitioners by R-1 based on the complaint of R-2 is in accordance with law? (2) Whether the petition filed by the petitioners is maintainable?
It. is not in dispute that R-1 based on the complaint of R-2 Manager one Vivekananda Pai has seized 70 tons of steel from the petitioners. Annexure-A is the complaint lodged by the manager of R-2. According to the complaint, 4 months prior to the date of lodging the complaint one Ramesh Babu of M/s Eshwar Trading Company used to purchase iron angles, steels and channels and used to pay value of the material purchased through cheques drawn on ING Vysya Bank and some times Manager of R-2 used to collect cheques from Ramesh Babu few days later. Considering the transactions, on the request over phone of Ramesh Babu, R-2 has despatched 70 tons of steel and Ramesh Babu hat promised to make payment within 10 days from the date of delivery, even after one and half months from the date of delivery amount has not been paid and on enquiry it was found that whereabouts of Ramesh Babu was not known and that he has switched of his mobile also. Therefore, he requested to trace the steel sold by R-2 to Ramesh Babu and to make arrangement to return the steel or in the alternative for refund of value of the steel. From the complaint, it is clear that the transaction between R-2 and Ramesh Babu is more in the nature of civil transaction and if R-2 was in the habit of supplying materials to M/s Eshwar Trading Company on credit basis. If the value of the goods are not paid to R-2, duty of the R-2 is to file a suit and recover the money from M/s Eshwar Trading Company. At the first instance, complaint lodged by R-2 could not have been registered by R-1. Even if it is registered, it is only for R-1 to find out the whereabouts of Ramesh Babu of M/s Eshwar Trading Company if he has cheated R-2. But based on this complaint, it cannot be held by R-1 that the goods purchased by the petitioners from M/s Eshwar Trading Company as; receiver of stolen goods. If the petitioners in their course of business have purchased goods from a wholesale dealer by paying money to M/s Eshwar Trading Company as it is not the case of R-2 that the materials of R-2 was stolen by M/s Eshwar Trading Company, steel of the petitioners could not have been seized by R-1, that too when petitioners are having valid documents to show the nature of transaction and the amount paid by the petitioners to M/s Eshwar Trading Company, In the circumstances, this Court is of the opinion that seizure of steel from the petitioners is illegal.
So far as the second point is concerned, it is to be noted by this Court that complaint is lodged by R-2 as against M/s Eshwar Trading Company and Ramesh Babu. In the complaint, it is not alleged by R-2 that petitioners are also involved along with Ramesh Babu in cheating R-2. Even after investigation, R-1 has not arrayed petitioners as accused, they are not the parties before the Magistrate and based on the seizure of steel from the petitioners, R-2 by filing an application has taken interim custody of the steel. Therefore, petitioners had no other go than to approach this Court since they are not parties to the criminal proceedings. According to this Court, petitioners have no other option than to approach this Court since there is no other alternative remedy available to the petitioners.
In the result, this petition is allowed. it is declared that Annexure-C dated 26.10.2007 under which 70 ton''s of steel seized from the petitioners is held as illegal and if R-2 has taken delivery of steel as an interim custody pursuant to the order of CJM, Tumkur in Cr. No. 106/2007 in CC No. 2356/2007 has to he returned to the CJM, Tumkur. It is open for the petitioners to request CJM, Tumkur to return the steel which has been taken over by R-2 to the petitioners as the seizure itself is invalid and illegal and petitioners are entitled to claim possession of the property pursuant to the directions issued in this case. Petitioners are entitled for costs of Rs. 15,000/- which shall be payable by Mr. Dinesh Patil, the then Sub-Inspector, Town Police Station, Tumkur as costs to the petitioners within 15 days from today.