The court emphasized the limited scope of interference in contractual matters through writ petitions and upheld the legality of repossession under the hire-purchase agreement.

Headnote:
repossession - hire-purchase agreement - Code of Civil Procedure, 1908, Section 115 - Clause 10 of the hire-purchase agreement
Fact of the Case:

Under a hire-purchase agreement, the hirer failed to make monthly instalment payments, leading to repossession of the vehicle by the financier. The hirer filed a civil suit seeking relief and interim orders, which was challenged in the High Court through a civil revision.
Finding of the Court:

The High Court upheld the trial court's order for release of the vehicle to the hirer upon deposit of the defaulted instalments, leading to the financier's appeal to the Supreme Court.
Issues: The issues involved the legality of repossession under the hire-purchase agreement, the maintainability of the civil suit, and the adequacy of the trial court's order for release of the vehicle.
Ratio Decidendi: The court held that repossession was permissible under the hire-purchase agreement's Clause 10. It emphasized that interference in contractual matters through writ petitions was limited unless the contract was unconscionable or opposed to public policy.
Final Decision: The appeal was allowed, and the hirer was directed to pay a specified amount within 10 days for the release of the vehicle, with the understanding that the trial court would decide the appellant's entitlement in the suit.

JUDGMENT

ARUIT PASAYAT, J. - Leave granted.

2. Challenge in this appeal is to the order passed by learned Single Judge of the Punjab and Haryana High Court dismissing the civil revision filed under Section 115 of the Code of Civil Procedure, 1908 (in short "the Code").

3. The background facts in a nutshell are as follows:

Under a hire - purchase agreement executed between the appellant (hereinafter referred to as "the financier") and Respondent I (hereinafter referred to as "hirer") possession of Truck No. HR 46 C 3689 was handed over to the hirer subject to compliance with the terms and conditions of the agreement. As per the terms and conditions stipulated in the agreement, the t hirer was to repay the total financed amount of Rs 9,24,000 in 33 monthly instalments of Rs 28,000 each. As per the agreement the first instalment was payable on 25 - 10 - 2000 and the last instalment was payable on 25 - 6 - 2003. In case of default in making payment of the monthly instalment the hirer was liable to pay delay charges. Clause 10 of the agreement which is relevant for the purpose of this appeal reads as follows:

"10. In case the hirer shall during the continuance of this agreement do or suffer any of the following acts or things viz. either:

(a) fail to pay any of the hiring (rent) instalments or any such monies which has fallen due within the provisions of this agreement, within or at the stipulated time, whether demanded or not;

(b) die, become insolvent, or compound with its creditors;

(c) the hirer, being a limited company, shall pass a resolution for voluntary winding up or shall have a petition for winding up presented against it or if a Receiver shall be appointed of its undertaking;

(d) pledge or sell or hypothecate or charge or mortgage or let or assign or attempt to pledge or sell or assign or part with possession of or otherwise alienate or transfer the vehicle;

(e) do or suffer any act or thing whereby or in consequence of which the said vehicle may be distrained or taken in execution under legal process or by legal process or by any public authority;

if) fail to keep or cause the vehicle comprehensively insured during the period of the agreement;

(g) fail to indemnify the owner, the insurance premium paid by the owner, resulting from the hirers failure to keep the insurance effective at any point of time during the currency of this hire agreement;

(h) fail to pay to the Government or any public authority any tax or surcharge or other levies due in respect of the vehicle;

(i) remove the vehicle to another State and get it re - registered there;

(j) break or fail to perform or observe any of the conditions on its part herein contained.

Then, on the occurrence of any such event, the right of the hirer under this agreement shall forthwith stand determined ipso facto without any notice to the hirer and all the instalments previously paid by the hirer shall be absolutely forfeited by the owner who shall thereupon be entitled to enter into any house or place where the said vehicle may then be, remove and retake possession of the same and to sue for all the instalments due and for damage for breach of the agreement and for all the costs of retaking possession of the said vehicle and all costs occasioned by the hirers default." (underlined for emphasis)

4. According to the financier there was default in making payment of the monthly instalments and the hirer was requested to clear the amounts due by several letters. In spite of several requests/demands the hirer did not pay the amount due and as on 27 - 8 - 2002 he was in arrears of Rs 1,34,000 on account of monthly instalments due excluding other charges payable on account of delay in making payment. Accordingly, the appellant repossessed the vehicle on 27 - 8 - 2002. According to the financier in view of the violation of the terms by the hirer the agreement stood terminated. Therefore, by registered letter dated 27 - 8 - 2002 the financier called upon the hirer to pay a sum of R

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