For this kind of dispute the Police can not impound the car unless the police reasonably thinks that the car is illegally obtained. 

Under the Motor Vehicles Act, 1988 and the rules issued by the Ministry of Road Transport & Highways, the legal position is as follows:

The electronic driving licence, RC and insurance shown through DigiLocker or mParivahan are legally valid documents. By official notification of the Central Government, traffic police are required to accept these digital records. Even a printout of DigiLocker details is generally accepted in practice; insistence on only a physical smart card is not supported by law.

If a driver does not have the physical licence at the time of checking, the police cannot seize the vehicle merely for that reason. At most, they may issue a challan for “not carrying licence”, which is a minor offence. The law allows seizure of a licence only for specific serious offences (such as drunken driving, dangerous driving, etc.), not simply because the card is missing.

Further, seizure of a vehicle is permitted only in limited situations, such as:
vehicle being driven without registration

vehicle being driven without any insurance

vehicle used in commission of a cognizable offence

vehicle being unsafe or mechanically unfit

None of these applied to you. Your vehicle was registered, insured, new, and roadworthy. Therefore, threatening to impound the car was illegal and coercive.

Demanding or hinting at cash payment on the spot, especially when no challan is issued, is also contrary to law. Fines are to be imposed only through a challan (physical or electronic), and payment is made through authorised modes. Cash collection in such circumstances raises serious issues of misconduct.

As for the allegation of signal jumping, if no challan was issued and no electronic record exists, legally it is as if no offence occurred.

Your rights in such situations are:

to show DigiLocker/mParivahan documents

to politely refuse cash payment

to ask for a challan to be issued if they believe an offence is made out

to note the officer’s name, badge number, vehicle number, and location

to later file a complaint with the Traffic Police control room or senior officers if harassment occurs

In short, they could not lawfully seize your car, and the threat was improper. You were within your rights, and the fact that they eventually let you go without any challan confirms that no legally sustainable violation existed.

Police cannot impound your vehicle when you have your driving licence in digital mode .Cops are legally bound to accept documents in DigiLocker or mParivahan

2) : A vehicle can only be seized for serious violations such as driving without a valid license (at all), without registration (RC), without a permit (for commercial vehicles), or if the vehicle is involved in a crime or accident.

3): Even if you cannot produce any documents at all (digital or physical) on the spot, you have a legal right to produce them at the designated police station within 15 days. 

4) If they do seize a document or vehicle, they must provide a written seizure memo or receipt. Without this, the seizure is illegal.

The law in this regard is that as per Section 4 of the Information Technology Act, 2000, Government notifications issued by the Ministry of Road Transport & Highways, the documents in DigiLocker and mParivahan are legally valid and equivalent to physical documents.  Even a digital copy shown on phone is valid.  A printout of DigiLocker DL/RC is also acceptable if it shows the QR / document ID. The Police cannot insist on physical smart card if valid DigiLocker document is produced.

The police cannot seize licence merely because you showed DigiLocker copy instead of original card, especially when a valid DL exists and you are able to identify yourself, therefore the police action of seizure is not justified. 

The Vehicle seizure is permitted only under limited circumstances, such as there is no valid driving licence at all or no insurance or if the Vehicle is involved in a cognizable offence or unauthorised transport vehicle use or with a fake registration.

If DL exists (even if physical card lost) and the DigiLocker copy shown and if the RC and insurance is valid, then the police cannot legally seize your car.  It would be illegal for the police to threaten to seize  for not paying cash on the spot. 

The police can  compound certain offences under Section 200 MVA, but, they must issue proper receipt or generate e-challan and the payment should be through official method (POS/online) and they cannot officially demand hefty cash. Demanding cash without receipt is an act of misconduct.  You may submit complaint to SP / Traffic DCP if harassment occurs or continues. 

Can they seize the car in such cases?

Under the Motor Vehicles Act, 1988, a police officer's power to impound documents is specifically outlined in Section 206, which primarily allows seizure of documents believed to be false or when the driver might abscond . Vehicle seizure for document non-production is not a direct penalty under the Act—the prescribed penalty for non-possession of a driving license under Section 177 is a fine of Rs. 500 for the first offence . While some state police directives have authorized vehicle seizure for missing documents as part of special enforcement drives , this appears to be an administrative measure rather than a statutory requirement. The threat to seize your car when you had digital printouts and a valid explanation was likely an intimidation tactic, especially since they offered an on-the-spot cash settlement.

What are my rights in such cases?

Your rights are firmly established by law. First, digital documents accessed through government platforms like DigiLocker are legally valid—the Ministry of Road Transport and Highways' 2018 circular explicitly mandates that enforcement agencies accept electronic copies of driving licenses and registration certificates . You were well within your rights to present printouts from DigiLocker, and the officer's demand for "originals" contradicted this legal framework . Second, you have the right to receive complete information about any alleged violation and challenge an unjust challan by filing a grievance online or contesting it in court . The fact that you were released without payment when traveling with someone on election duty further suggests the threat was unfounded.

In above case they can’t impound your car

Dear client,

The Motor Vehicles Act of 1988 allows for electronic proof of vehicle documentation. The Ministry of Road Transport holds that DigiLocker or mParivahan documents are legally valid for all intents and purposes and provide exactly the same authority as original paper documents. As such, having copies of your driver's license, Registration Certificate (RC), and insurance in your DigiLocker are sufficient for inspection purposes.

If the police officer believes you violated traffic laws, they may issue a challan; however, they may only confiscate your vehicle under certain circumstances—if it has no valid record of registration or insurance or you do not possess a valid driver’s license, among others. If you did not produce your smart card, the police will likely not impound your vehicle if you have an FIR for the license's loss and/or can prove the existence of an electronic copy.

Section 206 permits an officer to seize a driver's license for serious infractions but does not include general, arbitrary seizures. Any fines imposed upon you must be formally documented with a physical receipt or processed through the e-challan system. A police officer cannot request cash as a fine without providing a legitimate receipt.

You have the right to ask for documentation related to the issuance of a challan, note the officer's name, badge number, and precinct. If you do not feel your complaint is satisfactorily addressed, please contact the traffic police’s grievance cell.

if you have any query please feel free to contact us

First, let me reassure you: from the facts you have described, the threat to seize your car appears legally questionable.

Let us examine this calmly and clearly.

Validity of DigiLocker Documents

Under the Motor Vehicles Act, 1988 read with notifications issued by the Ministry of Road Transport & Highways, digital documents stored in:

• DigiLocker
• mParivahan

are legally valid and must be accepted by traffic authorities.

The Supreme Court and Central Government circulars have clarified that:

Electronic records accessed through DigiLocker are equivalent to original physical documents.

Therefore:

✔ A DigiLocker driving licence is legally valid.
✔ A DigiLocker RC is legally valid.
✔ Insurance copy (physical or digital) is acceptable.

They cannot insist on physical “original” if valid digital proof is produced.

 What About the Lost Smart Card Licence?

If your licence was pickpocketed and:

• You have lodged an FIR, and
• You have a valid licence reflected in DigiLocker,

Then you are legally licensed to drive.

Failure to physically carry licence may attract a minor challan in some circumstances, but it does not automatically justify seizure of vehicle.

When Can Police Seize a Vehicle?

Police can seize a vehicle only in specific situations, such as:

• No registration
• No valid insurance
• No driving licence at all
• Vehicle involved in offence
• Dangerous condition of vehicle

Mere non-production of physical original, when valid digital proof exists, is not normally grounds for seizure.

Seizure power is not discretionary harassment power — it must be legally justified.

Demand for Cash on the Spot

This part is concerning.

Under lawful procedure:

• Fine is imposed through challan.
• Payment is made digitally or through authorised channels.
• Receipt must be issued.

Demanding “hefty amount in cash” to avoid seizure suggests improper conduct.

You were correct not to pay cash without formal challan.

If They Had Issued a Challan

If they genuinely believed you jumped a signal:

• They could issue e-challan.
• You could contest it later before traffic court.
• Vehicle seizure is not the standard response to a simple signal violation.

Jumping red light is a compoundable traffic offence, not a vehicle-confiscation offence.

Could They Have Seized the Car?

In the circumstances you described:

• Valid DigiLocker documents
• No proof of signal violation
• No accident
• No intoxication
• No dangerous driving

Seizure would likely have been excessive and challengeable.

What Are Your Rights in Such Situations?

You have the right to:

✔ Show digital documents
✔ Ask for formal challan instead of paying cash
✔ Request the officer’s name and badge number
✔ Ask under which section seizure is being done
✔ Refuse to pay unofficial cash

You should remain polite but firm.

A simple line works well:

“Sir, I am ready to accept a lawful challan. Please issue it officially.”

That usually changes tone immediately.

Practical Advice for Future

To avoid unnecessary friction:

Keep FIR copy (soft copy) on phone.
Keep DigiLocker app ready (not just printout).
Record interaction discreetly if situation escalates (where lawful).
Never argue aggressively — insist on legal process calmly.

Since No Challan Was Issued

Because:

• No challan message has come
• No seizure memo was issued
• No paperwork was done

The matter appears closed.

There is no pending liability unless an e-challan is generated later.

You can periodically check traffic portal for your vehicle number to be certain.

Final Legal Position

Based on your narration:

✔ Digital documents are legally valid.
✔ Seizure threat appears disproportionate.
✔ Cash demand without challan is improper.
✔ You acted prudently by not paying unofficially.

This appears to be an intimidation attempt rather than a legally sustainable action.

- The police can only issue challan if you are showing the FIR for the lost of the documents

- You can lodge a complaint before the higher police officials against him .