Court clarifies procedure under Bharatiya Nagarik Suraksha Sanhita, 2023 for seizure of suspected stolen property; emphasizes protection of pledgee's rights and proper judicial process
In a significant judgment dated September 3, 2026, the Himachal Pradesh High Court delivered a decision in the case of Bajaj Finance Limited v. State of Himachal Pradesh, clarifying the legal position regarding the production and seizure of pledged property suspected to be stolen. The petitioner, Bajaj Finance Limited, a Non-Banking Financial Company (NBFC), had advanced a loan against gold ornaments and jewellery pledged by a borrower later found to be stolen. During investigation, the police issued a notice under Section 94 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), demanding production of the pledged goods. The NBFC challenged this notice in the High Court.
The Court examined the scope of Section 94 BNSS, which empowers courts or police officers to summon documents, electronic communications, communication devices, or "other things" necessary for investigations or trials. The Court held that Section 94 does not authorize police to compel the production of physical property, such as pledged gold ornaments, merely by issuing a notice. The phrase "other thing" must be interpreted in the context of digital evidence and electronic devices, not tangible stolen property.
Instead, the Court emphasized that Sections 106 and 107 BNSS govern the seizure and attachment of property alleged to be stolen or proceeds of crime. These provisions require police to seek prior approval from the competent Court or Magistrate before confiscating or attaching such property. The Court further highlighted that this judicial process safeguards the rights of the person in possession of the property - in this case, the NBFC - by providing an opportunity to be heard before any order of attachment or seizure is passed.
The Court noted the particular interest of the NBFC as pledgee, which lawfully holds the gold ornaments as security for the loan advanced. It underscored that the NBFC's interest must be protected and considered when the investigating agency seeks production or attachment of the pledged property. The Court set aside the police notice issued under Section 94 and directed the investigating agency to follow the proper procedure under Sections 106 and 107 BNSS to approach the Court for permission to seize or attach the property.
This ruling clarifies the procedural safeguards that must be observed when dealing with pledged property suspected to be stolen, reinforcing the principle that possession and ownership interests cannot be overridden by unilateral police action without judicial oversight. The judgment balances the need for effective criminal investigation with protection of lawful interests of financial institutions holding pledged assets.
Bottom Line:
Bharatiya Nagarik Suraksha Sanhita, 2023 - Pledged gold ornaments allegedly found to be stolen property - Non-Banking Financial Company cannot be compelled to produce pledged property merely on basis of notice under Section 94 BNSS - Investigating agency must resort to Sections 106 and 107 BNSS by approaching competent Court/Magistrate - Interest of pledgee in possession is also required to be protected by affording opportunity of hearing.
Statutory provision(s):
Bharatiya Nagarik Suraksha Sanhita, 2023 - Sections 94, 106, 107
Bajaj Finance Limited v. State of Himachal Pradesh, (HP) : Law Finder Doc Id # 2996354
