Man Buys Discounted Demo Car, Faces Criminal Charges; Karnataka HC Slams ‘Illegal’ Seizure By RTO In ₹60 Lakh Tax Dispute

The Karnataka High Court quashed an FIR and ordered a departmental inquiry after a Bengaluru RTO officer allegedly entered a car owner’s house and seized a demo vehicle without proper notice while citing road tax dues of nearly Rs 60 lakh.

A Bengaluru resident who purchased a discounted demo car later found himself facing criminal charges and the seizure of his vehicle in a dramatic dispute involving alleged road tax irregularities.

According to court proceedings, the man had bought a demo car in September 2025. The vehicle, manufactured in 2021, had reportedly been briefly registered earlier before being returned by the original buyer.

Trouble began when a senior RTO officer allegedly entered the owner’s residence and seized the vehicle without prior notice. The car was then taken to a police station in Bengaluru.

The owner later discovered that a zero FIR and criminal case had been registered against him over allegations of fraud, forgery and fabrication of registration documents linked to the vehicle.

The prosecution argued that the vehicle had not been properly registered for several years and that records in the RTO office had allegedly been manipulated or deleted, causing financial loss to the Karnataka government through unpaid road tax.

However, the Karnataka High Court strongly criticised the manner in which the seizure was carried out.

As reported by LiveLaw, the court observed that although authorities have powers under law to recover unpaid vehicle tax, seizure cannot be the first step. It noted that due process must be followed, including issuing notices, determining the exact tax liability and giving the vehicle owner an opportunity to respond.

The High Court remarked that the officer had “no mandate” to enter a person’s house and remove the vehicle in such a manner.

The court further said the sequence of events showed a serious violation of legal procedure. According to the order, the FIR was registered first, the vehicle was seized immediately afterwards and only later was a demand notice considered.

The High Court described the conduct as a “manifest and egregious abuse of authority” and said procedural safeguards had effectively been ignored.

In its order, the court:

• Quashed the FIR registered against the car owner
• Directed that the seized vehicle be returned within one week
• Ordered a departmental inquiry against the RTO officer
• Directed authorities to investigate alleged deletion or manipulation of RTO records

At the same time, the High Court clarified that quashing the FIR would not prevent authorities from taking lawful action in future if tax evasion is established after proper inquiry and due process.

The court also stated that while the seizure action was illegal, the state still retains the power to investigate any genuine tax irregularities strictly according to law.