The legal entity of a company is distinct from its directors and shareholders. Section 51 (5) of the Motor Vehicle Act allows for the issuance of a fresh registration certificate in favor of the financier if the borrower defaults on a Hire Purchase Agreement.

This writ petition has been filed against the impugned order dated 31-12-2001 Annexure-9 to the writ petition passed by the Additional Transport Commissioner, Head Quarter U. P. and for a mandamus directing the respondent No. 1 to issue a fresh registration certificate in favour of the petitioner company declaring the petitioner company as owner of the Truck in question.

2. The petitioner is doing business of Automobile Finance and it financed a sum of Rs. 3,80,000/- to the respondent No. 3 for purchasing the truck in question, and a Hire Purchase Agreement was entered into the registration certificate. The respondent No. 3 failed to pay the dues of the petitioner company and sold the truck to respondent No. 4 Smt. Mamta Dwivedi who allegedly assured the petitioner that the entire dues of the petitioner shall be paid by the respondent No. 4. It is alleged in paragraph 4 of the writ petition that respondent No. 4 requested that the Hire Purchase Agreement of the petitioner company may be deleted from the registration certificate and a fresh Hire Purchase Agreement may be entered showing the name of the respondent No. 5 as Financer and the name of the respondent No. 4 may be declared as owner of the vehicle. The petitioner on 1-12-99 wrote a letter to the respondent No. 1 Regional Transport Officer, Kanpur with the prayer that the vehicle may be registered in the name of the respondent No. 4 and the name of the respondent No. 5 may be entered as Financer vide Annexure- 1 to the writ petition. True copy of the registration certificate has been annexed as Annexure-2 to the writ petition. It is alleged in paragraph 5 of the petition that when the respondent No. 1 failed to issued fresh registration certificate the respondent No. 4 also failed to keep her promise to pay the dues of the petitioner company. The petitioner company on 12-6-2000 vide Annexure-3 to the writ petition filed an application before the respondent No. 1 to transfer the vehicle in the name of the petitioner in terms of Section 51 (5) of the Motor Vehicle Act. The respondent No. 1 issued letter dated 16-10-2000 asking the petitioner to submit the payment receipt vide Annexure-4 to the writ petition. The petitioner sent letters dated 17-10-2000 and 1-2-2001 to the respondent No. 1 praying for issuance of fresh registration certificate vide Annexures 5 and 6 to the writ petition. The petitioner company issued notice to respondent Nos. 1 and 2 through its counsel on 26-2-2001. The respondent No. 1 issued letter dated 13- 3-2001 asking the petitioner to release the vehicle in favour of the respondent No. 4 although the respondent No. 4 had failed to pay the dues of the petitioner company. True copy of the letter dated 13- 3-2001 has been annexed as Annexure-8 to the writ petition.

3. It is alleged in paragraph 8 of the writ petition that respondent No. 1 has acted illegally and arbitrarily by not issuing fresh registration certificate in favour of the petitioner. The petitioner company took possession of the vehicle in question being Truck No. U. P. 78 N/8683 because the respondent Nos. 3 and 4 had failed to pay the dues of the petitioner company and committed fraud upon the petitioner company. The Additional Transport Commissioner (HQ), U. P. then passed order dated 31-12-2001 disallowing the claim of the petitioner for fresh registration certificate vide Annexure-9 to the writ petition. In paragraph 9 of the writ petition it is alleged that the respondent No. 3 has illegally transferred the vehicle in favour of the respondent No. 4 in collusion and to defraud the petitioner company. The name of the petitioner company exists in the registration certificate under the Hire Purchase Agreement and respondent Nos. 3 and 4 have failed to pay the dues of the petitioner company, which is in possession of the truck in question. The petitioner has relied on Section 51 (5) of the Motor Vehicle Act, 1988.

4. A counter-affidavit has been filed by the respondent No.