REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL

NO. 6 of

2021

(arising out of SLP (Crl.) No.3893/2020)

SREI EQUIPMENT FINANCE LTD.

...APPELLANT(S)

VERSUS

RAMJAN ALI & ORS.

...RESPONDENT(S)

J U D G M E N T

ASHOK

BHUSHAN,J.

Leave granted.

2.

This appeal has been filed challenging the

judgment dated 28.01.2020 of High Court of Judicature

at Allahabad, Lucknow Bench allowing the application

under Section 482 Cr.P.C. filed by respondent No.1.

By impugned judgment, High Court has directed for

release of vehicle JCB No.UP 51 AT 5709 in favour of

the respondent No.1.

The appellant, who was

respondent No.3 before the High court aggrieved by

the judgment has come up in this appeal.

3.

Brief facts of the case and events necessary to

be noted for deciding this appeal are:-

1

Digitally signed by

MEENAKSHI KOHLI

Date: 2021.01.05

16:43:43 IST

Reason:

Signature Not Verified

3.1 One Amarnath Yadav purchased the JCB machine

and entered into a finance agreement dated

22.10.2016 with the appellant under which

agreement the appellant financed an amount of

Rs.19,83,360/-. Under the agreement, Shri

Amarnath Yadav (hereinafter referred to as

“original owner”) agreed to repay the loan in

46 monthly instalments @ Rs.56,300/- for each

month from 15.12.2016 to 15.09.2020.

3.2 The original owner being resident of District

Basti, State of Uttar Pradesh applied for

registration of the vehicle to the Regional

Transport Officer, Basti. The vehicle was

registered by Regional Transport Officer,

Basti, Shri Amarnath Yadav as owner of JCB

machine bearing Registration No. UP 51 AT

5709 and there being agreement of finance

with appellant, in the registration

certificate the entry was made of the

appellant as person in whose favour the

vehicle was hypothecated as required by

Section 51 of the Motor Vehicles Act, 1988.

The original owner failed to pay any

2

instalment of loan. The appellant as per

terms of the finance agreement dated

22.10.2016 referred the dispute to an

arbitrator. The arbitrator proceeded to

decide the reference as per Arbitration and

Conciliation Act, 1996. Notices were issued

by Arbitrator to original owner. Original

owner failed to appear before the arbitrator.

The arbitrator gave an award dated 26.03.2018

in favour of the appellant namely M/s. Srei

Equipment Finance Private Limited for an

amount of Rs.25,97,053/- with interest @ 10%

p.a. from the date of notice of termination

(07.03.2017).

3.3 The original owner made an application with

the Regional Transport Officer, Basti praying

for seeking cancellation of entry of the

appellant as person with whom the vehicle was

hypothecated. Regional Transport Officer,

Basti issued an order on 16.08.2018

cancelling the entry of appellant as

financer. The Regional Transport Officer,

Basti without any information to the

3

appellant cancelled the entry of the

appellant from the registration certificate

and issued a fresh registration certificate

in the name of original owner.

On

16.08.2018, the Regional Transport Officer,

Basti issued a clearance certificate in

favour of original owner noticing the fact

that vehicle has been sold to Ramjan Ali, the

respondent No.1 in the jurisdiction of other

registration authority, i.e., Sitapur.

3.4 On the basis of clearance certificate issued

by Regional Transport Officer, Basti, the

respondent No.1, Ramjan Ali submitted an

application for certificate of registration

to Transport Department, Sitapur and a

registration certificate dated 27.08.2018 was

issued in the name of Ramjan Ali as owner.

The registration certificate dated 27.08.2018

also noted the entry of hypothecation in

favour of Magma Fincorp Limited.

The

respondent No.1 after obtaining t