IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN THURSDAY, THE 3RD MARCH 2011 / 12TH PHALGUNA 1932 WP(C).No. 27758 of 2010(T) -------------------------- PETITIONER(S): ----------------------- MINI SIMON, S/O.A.J.SIMON AGASSALAYIL HOUSE, KEEZHOOR PO KOTTAYAM DIST REPRESENTED BY HER POWER OF ATTORNEY HOLDER A.J.SIMON, AGANASALAYIL HOUSE, KEEZHOOR PO, KOTTAYAM DISTRICT. BY ADVS. SRI.K.V.GOPINATHAN NAIR SMT.G.CHITRA RESPONDENT(S): -------------------------- 1. THE JOINT REGIONAL TRANSPORT OFFICER VAIKOM PIN 686 604. 2. M/S. MAGNA FINCORP LTD JAIN TOWERS OPP K.S.E.B, NH BYE PASS ROAD, VYTTILA KOCHI PIN 682 031. *3. ADDITIONAL R3 IMPLEADED M.K. BENOY, AGED 42 YEARS, S/O JUNJU PILLAI, PINAM KOTTIN (H), MARADY P.O., MOOVATTUPUZHA, ERNAKULAM. * ADDL.R3 IS IMPLEADED AS PER ORDER DATED 12.1.2011 IN I.A.17220/2010. BY GOVT. PLEADER SRI. BASANT BALAJI FOR R1 ADVS. SRI.VARGHESE C.KURIAKOSE FOR R2 SRI.M.A.FAYAZ FOR ADDL.R3 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 03/03/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: kp WPC.No.27758 OF 2010 APPENDIX PETITIONER'S EXHIBIT: EXT.P1: TRUE COPY OF THE REGISTRATION PARTICULARS IN RESPECT OF STAGE CARRIAGE KL-36/A 3575. EXT.P2: TRUE COPY OF THE LETTER ISSUDED BY THE 2ND RESPONDENT DATED 10.6.2010. EXT.P3: TRUE COPY OF THE LETTER SUBMITTED BY THE PETITIONER TO THE 2ND RESPONDENT DATED 1.7.2010 THROUDH HER LAWYER DATED 1.7.2010. EXT.P4: TRUE COPY OF THE NOTICE ISSUED BY THE 1ST RESPONDENT DATED 12.7.2010. EXT.P5: TRUE COPY OF THE LETTER SUBMITTED BY THE PETITIONER BEFORE THE 1ST RESPONDENT DATED 26.7.2010. RESPONDENTS' EXHIBITS: EXT.R(2)(a): TRUE PHOTOSTAT COPY OF THE NOTICE CALLING FOR REGULARISATION ISSUED ON 8.10.2009. EXT.R(2)(b): TRUE PHOTOSTAT COPY OF THE NOTICE CALLING FOR REGULARISATION ISSUED ON 4.1.2010. EXT.R(2)(c): TRUE PHOTOSTAT COPY OF THE NOTICE DATED 17.3.2010 SENT THROUGH REGISTERED POST FROM THE HEAD OFFICE. EXT.R(2)(d): TRUE PHOTOSTAT COPY OF THE REGISTRATION CERTIFICATE. EXT.R(2)(e): TRUE PHOTOSTAT COPY OF THE LETTER DATED 10.6.2010 ISSUED TO THE PETITIONER. EXT.R(2)(f): TRUE PHOTOSTAT COPY OF THE POLICE INTIMATION GIVEN ON 7.6.2010 EXT.R3(a): PHOTOCOPY OF THE RECEIPT FOR RS.7,00,000/- ISSUED TO THE PETITIONER. EXT.R3(b): PHOTOCOPY OF THE AUTHORIZATION ISSUED BY 2ND RESPONDENT. EXT.R3(c): PTHOTOCOPY OF THE 1ST RESPONDENT'S ORDER DATED 10.8.2010. EXT.R3(d) : PHOTOCOPY OF THE DUPLICATE REGISTRATION CERTIFICATE. //TRUE COPY// P.A. TO JUDGE. P.N.RAVINDRAN, J. --------------------------- W.P.(C) No. 27758 OF 2010 -------------------------- Dated this the 3rd day of March, 2011 J U D G M E N T The petitioner is the owner of a stage carriage bearing registration No.KL-36/A 3575. The said vehicle was financed by the second respondent herein and an endorsement in that regard was made in the original of the registration certificate, a copy of which is on record as Ext.P1. The petitioner defaulted repayment of the loan. The financier thereupon repossessed the vehicle on 6.6.2010. After the stage carriage was repossessed, the second respondent issued Ext.P2 notice dated 10.6.2010 to the petitioner informing her that unless the sum of Rs.8,12,847/-, the balance amount due, is paid together with interest at the rate of 36% per annum from 30.6.2010, the vehicle will be sold without further notice, the sale proceeds will be adjusted against the arrears and in case of short fall, the petitioner will be liable to pay the short fall to recover which appropriate proceedings will be initiated. The petitioner replied by causing Ext.P3 notice to be issued through her lawyer. 2. After repossessing the vehicle, the second respondent submitted an application to the registering authority, the first WPC No.27758/2010 2 respondent herein, for the issuance of a fresh registration certificate alleging that the petitioner has not surrendered the original of the registration certificate. The registering authority thereupon issued Ext.P4 notice to the petitioner calling upon her to surrender the certificate of registration retained by her within 7 days from the date of receipt of the notice. She was also informed that if she fails to surrender the original certificate of registration, a fresh certificate of registration will be issued in the name of the financier cancelling the registration held by her in accordance with section 51(5) of the Motor Vehicles Act, 1988. The petitioner replied by causing Ext.P5 notice to be issued whereby she requested the registering authority to desist from issuing a fresh certificate of registration. This writ petition was thereupon filed on 6.9.2010 seeking the following reliefs: “(i) To issue a writ of prohibition prohibiting the 1st respondent from issuing fresh registration certificate in respect of stage carriage KL-36/A 3575 to the 2nd respondent since the petitioner is ready and willing to clear the entire outstanding amount to the 2nd respondent. (ii) To declare that the 2nd respondent has no right or authority in any manner to detain the petitioner's stage carriage KL-36/A 3575 and bound to release the same to the petitioner by accepting the outstanding amount.” 3. The main contention raised by the petitioner is that the WPC No.27758/2010 3 financier forcibly repossessed the vehicle, that she is willing to pay entire loan outstanding and therefore, the first respondent is bound to take into consideration the willingness of the petitioner to settle the dues and to desist from issuing the fresh certificate of registration to the second respondent. The second respondent has filed a counter affidavit wherein it is stated that as the petitioner was consistently in default, a notice was issued to her on 17.3.2010 demanding payment of the sum of Rs.9,22,540/-, that the petitioner did not clear the liability and therefore the second respondent repossessed the vehicle on 7.6.2010. It is stated that thereafter, an intimation was given to the petitioner to clear the arrears within 7 days, that the petitioner did not clear the arrears and therefore, the second respondent entered into an agreement with the additional third respondent on 28.6.2010 whereby the vehicle was sold to the additional third respondent for Rs.7,00,000/- and possession of the vehicle was handed over to him on behalf of the second respondent. It is also contended that though the petitioner has now offered to pay the entire amount due, no such offer was made before any authority and that the willingness expressed by the petitioner to pay the entire amount due from her WPC No.27758/2010 4 cannot be treated as bona fide in view of the stand taken by her in Exts.P3 and P5 lawyer notices. 4. The additional third respondent, the purchaser of the vehicle, has in the affidavit filed in support of the application for impleading namely I.A. No.17228 of 2010 stated that he has already paid the sum of Rs.7,00,000/- on 28.6.2010 to the second respondent and obtained possession of the vehicle. He has also stated that on the application filed by the second respondent for issue of a fresh certificate of registration, the registering authority, the first respondent herein, has passed Ext.R3(c) order dated 10.8.2010 directing the Additional Registering Authority to issue a fresh registration certificate in respect of the stage carriage bearing registration No.KL-36/A 3575 after cancelling the original registration certificate and that though a fresh certificate of registration was accordingly prepared, the original of the certificate was not issued to the second respondent in view of the fact that this writ petition happened to be final shortly thereafter. 5. I heard Sri.K.V.Gopinathan Nair, learned counsel appearing for the petitioner, Sri.Basant Balaji, learned Government WPC No.27758/2010 5 Pleader appearing for the first respondent, Sri.Varghese C.Kuriakose, learned counsel appearing for the second respondent and Sri.M.A.Fayaz, learned counsel appearing for the additional third respondent. During the course of arguments on an earlier occasion, a query was put to the learned counsel for the second respondent as to whether on the petitioner paying the amount due as on the date of termination of the hire purchase agreement, namely the amount due as on 30.6.2010 with future interest, the second respondent is willing to handover possession of the vehicle to the petitioner. The second respondent thereupon filed a statement dated 4.2.2011 through the authorised officer. It is stated that as on 30.6.2010 the amount due from the petitioner was Rs.8,07,501.91, that as per the agreement the petitioner is liable to pay interest at the rate of 36% per annum, that the interest payable till date is Rs.1,69,575/- and that computed on that basis, the total amount due as on 4.2.2011 is Rs.9,77,077/-. The learned counsel for the second respondent submitted that as the vehicle has been sold for Rs.7,00,000/- and the amount credited to the loan account of the petitioner, the petitioner is liable to pay only the sum of Rs.2,77,077/- and that having regard to the fact that the WPC No.27758/2010 6 sale has already been effected and vehicle delivered over to the additional third respondent and as orders have already been passed on the application for issuance of a fresh registration certificate, the petitioner is not entitled to any relief in the writ petition. 6. It is discernible from the pleadings and from the submissions made at the Bar that as on today the vehicle is in possession of the additional third respondent. The fact that the additional third respondent has paid over the sum of Rs.7,00,000/- to the second respondent is also not disputed. In fact, from the materials on record one can safely presume that the second respondent has already sold the vehicle to the additional third respondent, though the certificate of registration in favour of the second respondent is yet to be issued. The vehicle in question is a 2008 model stage carriage that was purchased on 26.11.2008 and registered on 16.6.2009 after the body was built. The hire purchase agreement was entered into between the petitioner and second respondent on 26.11.2008. Though no document is produced to show the invoice value of the vehicle, from the very fact that the second respondent had extended financial assistance of WPC No.27758/2010 7 Rs.8,62,500/- it can safely be presumed that the value of the vehicle was more than Rs.9,00,000/-. Ext.R2(c) letter indicates that the amount defaulted and due as on 17.3.2010 was Rs.97,496. The amount payable by way of repayment instalments was Rs.24,444/- per mensem. That means, the petitioner had defaulted payment of four instalments as on 17.3.2010. The instalments were payable on 20th of every month. Therefore on 20th March, 2010 the fifth instalment was also due. The vehicle was repossessed in June, 2010 which means as on that date, six instalments of Rs.24,444/- were due. The materials presently on record disclose that for realisation of the sum of Rs.1,46,664/- (24,444/-x6) the vehicle, the value of which is more than Rs.9,00,000/-, was repossessed and it was sold to the additional third respondent for the sum of Rs.7,00,000/-. The second respondent has stated in categorical terms that the third respondent is holding possession of the vehicle on behalf of the second respondent. Even after the sale to the third respondent, the second respondent claims that the sum of Rs.2,77,000/- was due from the petitioner as on 4.2.2011. The petitioner would therefore still continue to be liable even after the WPC No.27758/2010 8 issuance of a fresh certificate of registration in favour of the second respondent. In such circumstances, I am of the opinion that the petitioner should be given an opportunity to pay the entire amount due from her in lump. The primary interest of the financier should be to get back the money advanced as loan with interest. Therefore, the financier cannot object to the petitioner repaying the loan in lump. At the same time, the third respondent who has invested Rs.7,00,000/- on 28.6.2010 should also be adequately compensated. In such circumstances, I dispose of the writ petition with the following directions:- (i) The petitioner shall within one month from today pay over to the second respondent the sum of Rs.9,77,077/- towards repayment of the loan availed by her. The petitioner shall within the said period deposit with the financier a further sum of Rs.50,000/- for payment to the additional third respondent as compensation. (ii) Upon the petitioner remitting the said sum of Rs.9,77,077/- and Rs.50,000/-, the second respondent shall handover the stage carriage bearing registration No.KL-36/A 3575 to the petitioner and make an application in writing to the first WPC No.27758/2010 9 respondent requesting him to cancel the orders, if any, passed on the application for issuance of a fresh registration certificate in the name of the second respondent. The first respondent shall thereupon cancel the order issued by him on the second respondent's application for grant of a fresh registration certificate in respect of the vehicle and inform the parties accordingly. (iii) The second respondent shall on the petitioner complying with direction No.(i), refund to the third respondent the sum of Rs.7,00,000/- paid by him and the sum of Rs.50,000/- to be deposited by the petitioner. Upon the petitioner complying with the aforesaid directions, respondents 2 and 3 have no claim whatsoever over the vehicle or against the petitioner. (iv) It is clarified that if the petitioner does not comply with the aforesaid directions within one month from today, the writ petition shall stand dismissed and it will be open to the official respondents to proceed to issue the fresh registration certificate applied for by the second respondent. P.N.RAVINDRAN (JUDGE) vps WPC No.27758/2010 10