The Gujarat High Court has said the state must reimburse a Gandhidham-based businessman for gold bars seized by police during a criminal investigation but not returned despite a court order.
The businessman, Praful Soni, was acquitted in August 2025. However, his legal battle continued after police claimed they could not trace the seized gold.
In an order passed on October 9, the High Court observed that the police were required to reimburse the cost of the gold seized from Soni. The court has not yet decided the final compensation amount.
A division Bench comprising Justices N S Sanjay Gowda and J L Odedra was hearing a contempt petition filed by Soni through advocate A A Zabuawala against a police officer from Gandhidham A-Division police station in Kutch district.
The case originated from a complaint filed by a woman who alleged that Soni had failed to return gold ornaments and silver articles worth Rs 70,000 entrusted to him in 2012-13.
Following the complaint, police registered an FIR against Soni under Sections 406, 420, 506(2) and 114 of the Indian Penal Code. During the investigation, police seized gold bars from him as collateral.
While seized property is generally deposited with the court, police had obtained permission from the trial court to keep the gold bars at the police station.
In August 2025, the Additional Chief Judicial Magistrate’s Court in Gandhidham acquitted Soni and directed the police to return the gold in accordance with the seizure receipt. The relevant communication was sent to the police inspector the following day.
However, police later informed the court through an affidavit that the gold ornaments could not be traced during a search of the police station.
During the contempt proceedings, the police officer tendered an unconditional apology and requested that the case be dropped. Soni opposed the request, arguing that an apology could not replace compliance with the court’s order to return the seized property.
The High Court also noted that Soni had filed an additional affidavit specifying the market value of the gold and the amount he sought from the state.
The assistant government pleader sought additional time to obtain instructions from the state government. The court subsequently scheduled the next hearing for October 28.
Meanwhile, Soni’s petition states that the woman had entrusted him with gold ornaments and silver articles under an arrangement that the items would be returned on demand. The dispute was later settled during the trial, with the complainant accepting Rs 3.5 lakh from Soni as full and final settlement.
The High Court’s order has established that the state must reimburse the cost of the unreturned gold, while the final amount payable remains to be determined.