The possession of a vehicle under a hire-purchase agreement does not confer absolute ownership, and the financier is entitled to seize the vehicle on default. The seizure by the financier does not constitute theft under the Indian Penal Code.

( 1 ) IN both these petitions under S. 482 of the Criminal P. C. the common question is when there is a hire-purchase agreement in respect of a motor vehicle, and when the motor vehicle is seized by the financier in enforcement of the clause in the agreement giving right to the financier to seize the vehicle and on the complaint being filed by the hirer alleging theft of the same and the motor vehicle having been seized by the Police and produced before a criminal Court whether it is the financier or the hirer who is entitled to the interim custody of the vehicle under Sec. 451, Cr. P. C.

( 2 ) CR. P. No. 110/92 arises out of the order of the Xth Additional Chief Metropolitan Magistrate, Bangalore City in P. C. R. 157/91 and Cr. No. 563/91. The complainant-respondent-1 ('respondent' hereafter) entered into hire-purchase agreement with the petitioner Shriram Transport Finance Company Limited ('financier' hereafter) in respect of goods vehicle No. CAM 8786 and the petitioner advanced Rs. 2,00,000/- with a stipulation that the same shall be repaid in 42 instalments. The agreement is dated 14-6-1990. The respondent came in possession of the vehicle and in the Registration Certificate his name came to be entered as the registered owner. By 7-10-1991 the respondent was highly irregular in payment of instalment amounts, defaults were committed by him and therefore in exercise of its right to seize the vehicle under the agreement the financier seized it on 7-10-91. Soon thereafter an intimation came to be given to the hirer-respondent on 9-10-1991. The respondent however filed a private complaint in the aforesaid Magistrate Court alleging theft of the vehicle by someone on 9-10-1991. The learned Magistrate referred the same under Sec. 156 (3), Cr. P. C. to the Assistant Commissioner of Police, Ulsoor, for investigation and report. On 11-10-91 the respondent-complainant filed an application under Sections 451 and 457, Cr. P. C. praying for interim custody of the vehicle which was seized by the Police in pursuance of the case registered for the offence alleged. Cr. No. 563/91 came to be registered under S. 379, I. P. C. by the Inspector of the Ulsoor Police Station and the vehicle was seized on. 10-10-1991 and reported to the Court that it was found parked in the compound of the MICRON Engineering Works at Mattikere on M. E. S. Road and permission was also sought from the Court to keep the same with the Police during investigation. A rival claim was also made by the present petitioner-hirer that because the respondent had committed default in payment of the instalments due, the vehicle was seized and therefore it was the financier who was entitled to the possession of the vehicle. The trial Court by its impugned order dated 2-11-91 found that the respondent is entitled to the possession of the vehicle under Sec. 457, Cr. P. C. That order is challenged in this petition.

( 3 ) IN Cr. P. No. 447/92 the position is otherwise. In a similar situation the Court of the VIIIth Additional Chief Metropolitan. Magistrate, Bangalore City, by its order dated 28-1-91 taking a contrary view directed the vehicle to be given to the custody of the financier and this order was challenged before the Court of the Principal City Sessions Judge, Bangalore by the hirer by a revision petition and the learned Sessions Judge by his order dated 13-1-92 upheld the order of the trial Magistrate and dismissed the revision. Lorry number AAA 9720 was the subject-matter of hire-purchase agreement in that case and the allegation of the hirer was that the same was stolen by the financier-2nd respondent in the revision petition.

( 4 ) WHEN both the petitions, one by the financier and the other by the hirer came before the learned single Judge on 12-10-1992 Shivappa J. referred them to a Division Bench of this Court under Sec. 9 of the Karnataka High Court Act in view of the conflicting decisions as to the person who is entitled to the interim custody of a motor