Seized silver missing from police station: Andhra Pradesh High Court cites negligence, asks state to pay jeweller 7 lakh

The order noted that the loss of such a large amount of silver and cash would absolutely impinge on the right of the petitioner, under Article 19(1)(g), to carry on his trade or business.

Case

A case originated from the seizure of 105 kilogram of pure silver lumps and Rs 2 lakh in cash in 2021, when officials from the Kumool Taluka police station seized and confiscated the silver and cash of a petitioner jeweller that were being transported from Hyderabad to Salem.

Subsequently, by calculating the rate of silver at Rs 66,667, the authorities gave the petitioner the option to pay a fine of Rs 35 lakh in place of confiscation.

The petitioner challenged this order in the high court in 2021, where the court ordered the liberty to the jeweller to seek an appropriate appellate remedy.

However, at the time of the disposal of the order in 2022, a further appeal in the GST Tribunal was not filed, as the GST Tribunal had not yet come into existence.

In this view of developments, in 2023, the petitioner paid a sum of Rs 39.20 lakh as a tax, penalty, and fine to the state tax department.

Following this, the assistant commissioner of state tax ordered the local police station to release the seized 105 kilogram of silver and cash to the petitioner.

But in a bizarre turn of events from here, when the petitioner approached for the release of his silver and cash, the local police informed him that the both the silver and cash had been stolen from the custody of the police, allegedly by their staff, and certain quantities of silver and cash had been subsequently recovered from these persons and were, at that stage, in the possession of the Kurnool judicial magistrate.

The petitioner then approached the Kurnool judicial magistrate, where the magistrate ordered the release of silver lumps and cash of Rs 10 lakh, which had been recovered from the accused persons.

However, the petitioner was given only 81.567 kilogram of silver and Rs 10 lakh cash, against the quantity of 105 kilogram of silver and cash of Rs 2 lakh, which had been seized.

At this stage, the petitioner also raised a contention that the silver seized by the police was 100 per cent pure silver, while 54.567 kilogram of the silver returned to him contained only 60 per cent silver, and only 27 kilogram was 100 per cent silver.

Then, the petitioner initiated criminal proceedings against the local police official for the theft at police station and not being compensated for his losses, and approached the high court.

Decision

The court held that in such circumstances, the petitioner is entitled to compensation for the loss suffered by him on account of the sheer negligence on the part of the officials of the state in protecting the property which has been seized by the police itself.

The court ordered that the petitioner is entitled to a return of 23.44 kilogram of pure silver, and the value of silver, as on the date, shall be taken for purposes of supply of such silver to the petitioner.

The court added that the additional cash of Rs 7.95 lakh shall be adjusted against the return of 23.44 kilogram, by taking the value of silver, as on today.