The Supreme Court has ruled that a vehicle’s registration certificate, by itself, cannot determine who should receive interim custody of a vehicle seized during a criminal investigation. Instead, courts must weigh the complete factual background before deciding who is entitled to temporary possession.
A Bench comprising Justices Sanjay Karol and Augustine George Masih observed that while a registration certificate is an important piece of evidence, it is not conclusive proof of entitlement to interim custody.
The Court explained that applications seeking temporary release of seized property require only a prima facie assessment. At this stage, the court examines the circumstances surrounding the seizure, the available material on record, and who appears to have the stronger claim to possession. Such proceedings are not meant to finally determine ownership rights.
The ruling came while the Court was hearing a dispute involving a pick-up truck, three excavators and a tipper that had been seized during a police investigation.
The controversy stemmed from allegations made by granite businessman Krishnan Narayana, who claimed that representatives of Earth Stein unlawfully removed the vehicles from the premises of his company, M/s Pure Minerals. Earth Stein, however, maintained that the vehicles had been acquired using company funds that Narayana had allegedly diverted while serving as one of its directors. Criminal complaints were subsequently lodged by both sides.
Following the seizure, both Narayana and Earth Stein sought interim custody of the vehicles. While the trial court declined both requests, the Andhra Pradesh High Court later directed that interim custody be handed over to Earth Stein. Narayana challenged that decision before the Supreme Court, arguing that the vehicles were registered in the name of his company and therefore should be returned to him.
Rejecting the argument, the apex court held that registration documents cannot be treated as the sole deciding factor.
The Bench noted several circumstances that supported Earth Stein’s claim. The vehicles had been seized from Earth Stein’s operational premises and had remained there under a written undertaking executed by Narayana. The Court also found that the loan instalments for the vehicles had been paid from Earth Stein’s bank account rather than by Narayana.
Considering these factors collectively, the Court concluded that they outweighed the evidentiary value of the registration certificates relied upon by Narayana. It therefore upheld the High Court’s order granting interim custody to Earth Stein and dismissed the appeal.
At the same time, the Court clarified that its observations were limited to the question of interim custody. The ruling does not determine the final ownership of the vehicles, the allegations relating to financial misappropriation, or the disputes concerning Narayana’s resignation and transfer of shares, all of which remain pending for adjudication.
