Back
2020 Supreme(Mad) 110
IN THE HIGH COURT OF JUDICATURE AT MADRAS
M. GOVINDARAJ, J.
S.K. Sampathkumar - Appellant
Versus
Indo Asain Finance Ltd, Chennai - Respondent
Second Appeal No. 1297 of 2011 & M.P. No. 1 of 2011
Decided On : 09-03-2020
For the Appellant:M. Balasubramanian, Advocate. For the Respondent:S. Nataraj Shankar, Advocate.
Repossession without a court order is illegal, and plaintiffs seeking equitable relief must act bonafide and comply with the terms of the agreement.
Headnote:
Usurious Interest Prevention Act - Hire Purchase Agreement - Tamil Nadu Prohibition on Exorbitant Interest Act 13 of 2003 - [PERMANENT INJUNCTION] - [CIVIL LAW] - [Usurious Interest Prevention Act, Tamil Nadu Prohibition on Exorbitant Interest Act 13 of 2003] - The court discussed the hire purchase agreement and the repayment terms, the legality of vehicle repossession, and the plaintiff's failure to prove payment. The court highlighted the illegality of repossession without a court order and emphasized the plaintiff's lack of bonafide actions and compliance with the agreement, leading to the dismissal of the suit.
Fact of the Case:
The plaintiff borrowed a sum of Rs.10,00,000 for the purchase of a bus through a hire purchase agreement. The plaintiff defaulted on payment, leading to the repossession of the vehicle by the defendant. The plaintiff filed a suit seeking permanent injunction and return of the bus.
Finding of the Court:
The court found that the plaintiff failed to prove proper payment and lacked bonafides, leading to the dismissal of the suit. The court emphasized the illegality of repossession without a court order and the plaintiff's failure to comply with the terms of the agreement.
Issues: The issues revolved around the legality of vehicle repossession, the plaintiff's compliance with the agreement, and the entitlement to discretionary relief sought by the plaintiff.
Ratio Decidendi: The court held that repossession without a court order is illegal and emphasized the plaintiff's lack of bonafide actions and compliance with the agreement, leading to the dismissal of the suit.
Final Decision: The second appeal was dismissed, and no costs were awarded. The court found that the judgment and decree of the Lower Appellate Court did not require any interference.
JUDGMENT
(Prayer: Second Appeal filed under Section 100 of Civil Procedure Code against the judgment and decree dated 22.11.2010 made in A.S.No.29 of 2009 passed by the learned VI Additional Judge, City Civil Court, Chennai confirming the judgment and decree dated 10.04.2008, dismissing the suit in O.S.No.6614 o f2006 passed by the learned XII Assistant Judge, City Civil Court, Chennai.)
1. Aggrieved over the concurrent findings of the Courts below the unsuccessful plaintiff has preferred the above Second Appeal.
2. The suit was filed for permanent injunction restraining the defendant from encumbering or selling the A.L. Bus bearing registration No.PY-01-T-1677 to any third party for a consequential mandatory injunction to return back the same to the plaintiff.
3. The case of the plaintiff is that he availed hire purchase loan to the tune of Rs.10,00,000/- from the defendant. He was actually paid a sum of Rs.7,70,000/- out of Rs.10,00,000/-. Besides a sum of Rs.55,000/- was taken for service charge and the balance amount of Rs.2,30,708/- was retained by the defendant as deposit. As per the agreement, the plaintiff shall repay the loan amount along with interest at the rate of 36% in 36 equal instalments, the monthly instalment being Rs.45,000/-. Due to some financial difficulties the plaintiff could not pay four instalments and it was adjusted from the deposit amount. Suddenly on 25.08.2004, the vehicle was repossessed by the defendant and hence he filed the suit for permanent injunction restraining the defendant from selling the vehicle. According to the plaintiff, he has already paid a sum of Rs.6,40,000/- to the defendant and after deducting the deposit amount of Rs.2,30,708/-, he is liable to pay only Rs.1,29,299/. Worth of the seized bus is around Rs.12,00,000/-. Therefore, the seizure of the bus is illegal and interest and financial charges at the rate of 36% flat is violative of Usurious Interest Prevention Act and Tamil Nadu Prohibition on Exorbitant Interest Act 13 of 2003. Therefore, he laid the suit for injunction and return of the bus.
4. Denying the allegation the defendant has filed a detailed counter, wherein it is claimed that the total arrears due and payable as on that day was Rs.15,00,000/-. The plaintiff admittedly had committed default in payment and despite repeated demands by telegraphs, the plaintiff failed to pay the instalments. After giving information to the concerned Police stations, both at Puducherry and Chennai the vehicle was repossessed. The plaintiff has failed to act in accordance with the agreed terms and conditions. On the other hand, the defendant is strictly adhering to the terms contained in the hire purchase agreement. Further, the seizure was made in the year 2004, whereas the suit is filed only in the year 2006. Thus delay by itself disentitles the plaintiff seeking discretionary and equitable relief before this Court.
5. The Trial Court framed appropriate issues and dismissed the suit.
6. On appeal, Lower Appellate Court framed appropriate points for consideration and heard the arguments of both sides. At that juncture, the plaintiff filed C.M.P.No.1800 of 2010 for receiving additional document and the Lower Appellate Court considered the document which was already marked as Ex.B.1 sought to be received as additional document and after considering the arguments dismissed both the CMP as well as the appeal. Aggrieved over the same, the appellant is before this Court.
7. This Court on 29.10.2011 admitted the Second Appeal on the following questions of law:
“The Second Appeal is admitted subject to the consideration of following substantial questions of law:
(1) Whether the Courts below uniformly committed an error of law in dismissing the Suit filed by the Appellant/Plaintiff merely by relying on the false and misleading allegations made by the Respondent/Defendant?
(2) Whether the Court below has committed an error of law in dismissing the application for adducing additional evidence at the App
