Full Judgment Text
* IN THE HIGH COURT OF DELHI AT NEW DELHI
rd
% Date of decision: 23 September, 2013.
+ RFA 552/2005
M/S SUNEET FINMAN PVT.LTD. ..... Appellant
Through: Mr. Anilendra Pandey, Adv.
Versus
AJIT SINGH & ORS. ..... Respondents
Through: Mr. Madan Lal, Adv. for R-1.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
RAJIV SAHAI ENDLAW, J.
nd
1. The appeal impugns the judgment and decree, dated 2 February,
2005 of the Court of the Additional District Judge (ADJ) in Suit No.30/2002
filed by the respondent No.1/plaintiff against the appellant and against one
Mr. Rajan Arora and Mr. Batan Singh, for recovery of Rs.1,50,000/-
together with interest at 9% per annum from the date of judgment/decree till
realization, from the appellant and the said Mr. Rajan Arora and Mr. Batan
Singh jointly and severally.
2. Notice of the appeal was issued and on the direction contained in the
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order dated 10 November, 2006, the said Mr. Rajan Arora and Mr. Batan
Singh who were earlier not impleaded as parties to the appeal were so
RFA No.552/2005 Page 1 of 15
impleaded and amended memo of parties filed. The said Mr. Rajan Arora
and Mr. Batan Singh failed to appear inspite of substituted service and were
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vide order dated 12 March, 2013 proceeded against ex-parte . The Trial
Court record has been requisitioned. The counsel for the appellant and the
counsel for the respondent No.1 Mr. Ajit Singh have been heard.
3. The respondent No.1 Mr. Ajit Singh instituted the suit from which
this appeal arises, pleading:
(i) that he was the registered owner of H.T.V. truck bearing
registration No.HR-38-4999;
(ii) that the appellant/defendant No.1 company is dealing in the
business of advancing of loans on the security of vehicles;
(iii) that the respondent No.1/plaintiff approached the
appellant/defendant No.1 for a loan of Rs.1,50,000/- and to secure the
same handed over the original Registration Certificate of his aforesaid
vehicle to the appellant/defendant No.1 for verification;
(iv) that however the said loan transaction did not materialize and
the appellant/defendant No.1 accordingly returned the original
Registration Certificate to the respondent No.1/plaintiff;
(v) that the respondent No.1/plaintiff on return of the original
RFA No.552/2005 Page 2 of 15
Registration Certificate found an endorsement of loan having been
thereon in the name of the appellant/defendant No.1;
(vi) that the respondent No.1/plaintiff asked the appellant/defendant
No.1 to have the said endorsement cancelled but the
appellant/defendant No.1 failed to do so;
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(vii) that on 29 /30 November, 2000, the appellant/defendant No.1
illegally, unlawfully and unauthorisedly and acting in collusion with
the local police seized the aforesaid vehicle without any warning or
notice in writing to the respondent No.1/plaintiff;
(viii) that though the respondent No.1/plaintiff approached the
appellant/defendant No.1 for return of the vehicle but with no effect;
(ix) that the appellant/defendant No.1 thus unauthorisedly and
illegally retained possession of the said vehicle of the respondent
No.1/plaintiff to the great loss and detriment of the respondent
No.1/plaintiff;
(x) that the appellant/defendant No.1 on the basis of false, forged
and fabricated documents transferred the said vehicle to the said Mr.
Rajan Arora impleaded as defendant No.2 and Mr. Batan Singh
impleaded as defendant No.3;
RFA No.552/2005 Page 3 of 15
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(xi) that the respondent No.1/plaintiff, on 28 February, 2002, upon
finding the said vehicle plying on the road, being driven by the driver
of defendant No.2, complained to the police and the same was seized
and later on released on Superdari to the respondent No.1/plaintiff.
The respondent No.1/plaintiff on the basis of the aforesaid
averments claimed the reliefs of, (a) mandatory injunction directing
the appellant/defendant No.1 to get the endorsement of loan in its
favour on the Registration Certificate of the vehicle
cancelled/removed from the records of the registration authorities and
from the Registration Certificate of the said vehicle; (b) permanent
injunction restraining the appellant/defendant No.1 and the other two
respondents/defendants from interfering in plying of the said vehicle
by the respondent No.1/plaintiff; and (c) for recovery of Rs.4,79,000/-
towards damages/mesne profits for illegal retention of the said vehicle
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between 1 December, 2000 till 4 March, 2002 when it was released
on Superdari to the respondent No.1/plaintiff.
4. The appellant/defendant No.1 contested the suit by filing the written
statement, pleading:
(a) that the endorsement on the Registration Certificate of the
RFA No.552/2005 Page 4 of 15
vehicle was made in anticipation of the loan transaction with the
respondent No.1/plaintiff and upon submission of Form No.34 by the
respondent No.1/plaintiff;
(b) that however upon the loan transaction not materializing not
only was the original Registration Certificate returned to the
respondent No.1/plaintiff but also an appropriate form duly signed on
behalf of the appellant/defendant No.1 and to enable the
appellant/defendant No.1 to have the said endorsement on the
Registration Certificate in favour of the appellant/defendant No.1
removed also handed over to the respondent No.1/plaintiff; a letter
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dated 30 March, 2001 in this regard was also written to the Motor
Vehicles Department of the place where the said vehicle was
registered;
(c) denying that the appellant/defendant No.1 had seized the said
vehicle or that the same was ever in the custody of the
appellant/defendant No.1 or that the appellant/defendant No.1 had
sold the same to the respondents No.2 & 3.
5. The respondent No.3 Mr. Batan Singh also contested the suit by filing
the written statement pleading that the said vehicle had been sold by the
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respondent No.1/plaintiff through his father to the respondent No.3 Sh.
Batan Singh.
6. On the pleadings aforesaid of the parties, the following issues were
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framed in the in the suit on 1 August, 2003:
“1. Whether on 29/30-11-2000 defendant No.1 illegally
unauthorisedly seized the truck bearing no.HR 38-499 of
which plaintiff is the registered owner without any
warning or notice at Delhi UP border? OPP
2. Whether defendants jointly and severally remained in
actual physical possession, control and user of the
aforesaid truck on the basis of false, forged and
fabricated documents from 29/30.11.2000 till 28.2.2002?
OPP
3. Whether there is no cause of action qua defendant no.1?
OPD-1
4. Whether plaintiff has signed form no.34? OPD-1
5. Whether defendant no.1 never came in possession of the
truck in question? OPD-1
6. Whether defendant no.3 purchased the truck in question
from the plaintiff and this father for a valid consideration
of Rs.2.50 lacs vide receipt dated 2.5.2001? OPD-3
7. Whether the plaintiff is entitled for the relief claimed for?
OPP
8. Relief.”
7. The respondent No.1/plaintiff besides examining himself examined
his father, the Khalasi on the vehicle when it was claimed to have been
seized by the appellant/defendant No.1 and the officials from the Transport
Department, police and the Court where the case on complaint of the
respondent No.1/plaintiff was pending.
RFA No.552/2005 Page 6 of 15
8. The appellant/defendant No.1 examined its Director. No evidence
was led by the respondents No.2 & 3 who were proceeded against ex-parte .
9. The learned ADJ in the impugned judgment has found/observed/held:
(i) that the respondent No.1/plaintiff prior to the institution of the
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suit had got issued a legal notice dated 9 June, 2001 to the
appellant/defendant No.1 and to which the appellant/defendant No.1
had failed to reply, as it ought to have; that adverse inference had to
be drawn against the appellant/defendant No.1 therefrom;
(ii) that since the respondent No.1/plaintiff and his father were in
transport business and three of their other vehicles had also been
financed from the appellant/defendant No.1, may be for this reason,
the respondent No.1/plaintiff never reported the matter to the police
or other authorities regarding illegal seizure of the vehicle aforesaid
by the appellant/defendant No.1;
(iii) that had the appellant/defendant No.1 at the time of return of
the original Registration Certificate to the respondent No.1/plaintiff
also handed over the requisite form enabling the respondent
No.1/plaintiff to have the endorsement in favour of the
appellant/defendant No.1 cancelled and had the appellant/defendant
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No.1 also written to the Transport Department for cancellation of the
endorsement, the appellant/defendant No.1 would have definitely
replied to the legal notice preceding the suit;
(iv) that it was the admitted case of the respondent/defendant No.3
Sh. Batan Singh that he came in possession of the vehicle; however
his case was that the vehicle was sold by the father of the respondent
No.1/plaintiff; that the respondent No.1/plaintiff and his father had
denied selling of the vehicle to the respondent/defendant No.3; that
the vehicle at the time of seizure on the complaint of the respondent
No.1/plaintiff was in possession of respondent/defendant No.2
namely Mr. Rajan Arora who was the driver of the
respondent/defendant No.3 Mr. Batan Singh; that though the
respondent/defendant No.2 Mr. Rajan Arora has also moved an
application for release of the vehicle to him but the vehicle had been
released to the respondent No.1/plaintiff as he was found to be the
registered owner thereof and as there was no record of transfer of
vehicle to any other person;
(v) that it thus stood proved that the vehicle was illegally seized by
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the appellant/defendant No.1 on 29 /30 November, 2000 and
RFA No.552/2005 Page 8 of 15
remained in possession of the appellant/defendant No.1 and the other
respondents/defendants No.2 & 3 and the respondent/defendant No.3
Mr. Batan Singh had failed to prove that the vehicle was sold to him
by the father of the respondent No.1/plaintiff.
Accordingly, damages in the sum of Rs.1,50,000/- with interest
as aforesaid were decreed against the appellant/defendant No.1 and
the respondents/defendants No.2 & 3 jointly and severally.
10. Even though there is no discussion in the judgment with respect to the
other reliefs including of mandatory injunction claimed by the respondent
No.1/plaintiff and no such relief has been granted but the counsel for the
respondent No.1/plaintiff states that no appeal has been filed and no
grievance with respect thereto has been made. Rather, finding that there is
no stay of execution, though the appeal has been pending before this Court
for the last nearly eight years, it was enquired from the counsel for the
respondent No.1/plaintiff whether decree has been executed. The counsel
for the respondent No.1/plaintiff states that no execution also has been filed
owing to the pendency of this appeal.
11. The only contention of the counsel for the appellant/defendant No.1 is
that the decree against the appellant/defendant No.1, solely for the reason of
RFA No.552/2005 Page 9 of 15
the appellant/defendant No.1 having not replied to the legal notice preceding
the suit, is unjustified. The counsel for the respondent No.1/plaintiff
supports the judgment.
12. I have perused the evidence recorded.
13. Though the major part of the cause of action for the suit from which
this appeal arises was the illegal seizure by the appellant/defendant No.1 on
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29 /30 November, 2000 of the vehicle but strangely no complaint
whatsoever was made by the respondent No.1/plaintiff of the said incident.
The respondent No.1/plaintiff in the plaint did not even give any
explanation therefor. The learned ADJ also, realizing the importance of the
said fact, has not held the same against the respondent No.1/plaintiff
reasoning that complaint of the incident ‘may not have been’ made by the
respondent No.1/plaintiff for the reason of the father of the respondent
No.1/plaintiff having got other three vehicles financed from the
appellant/defendant No.1. However, on perusal of the Trial Court record,
the said reasoning is found to be a hypothesis of the imagination of the
learned ADJ and without any foundation in evidence. There is no evidence
of the respondent No.1/plaintiff or his father to the said effect. No
particulars even of the other vehicles of the father of the respondent
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No.1/plaintiff so financed or documents of such finance in operation as on
that date have been proved. Rather, the respondent No.1/plaintiff in his
affidavit by way of examination-in-chief has deposed that he did approach
the police for help but was not given on the ground that the dispute was of a
civil nature.
14. Thus, the reasoning given by the learned ADJ on the important aspect
of the respondent No.1/plaintiff having not complained of the alleged illegal
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seizure of the vehicle on 29 /30 November, 2000 by the
appellant/defendant No.1 is without any basis and rather contrary to the
evidence on record and cannot be sustained.
15. It is interesting to note that ultimately the respondent No.1/plaintiff
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went to the police and it was the police only who on 28 February, 2002
seized the said vehicle. If the respondent No.1/plaintiff could go to the
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police on 28 February, 2002, he could have so gone to the police on
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29 /30 November, 2000 as well. It is not the case of the respondent
No.1/plaintiff that the agreements of finance of other vehicles which were in
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force/operation on 29 /30 November, 2000 had come to an end by 28
February, 2002.
16. The counsel for the respondent No.1/plaintiff at this stage interjects to
RFA No.552/2005 Page 11 of 15
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state that on 28 February, 2002, the matter was reported to the police on
finding the vehicle plying.
17. I find the said argument to be also strange. It appears that the
respondent No.1/plaintiff was not aggrieved from the alleged illegal seizure
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on 29 /30 November, 2000 of the vehicle and became aggrieved only on
seeing the same plying.
18. The counsel for the respondent No.1/plaintiff has while supporting
the judgment contended that since the appellant/defendant No.1 was not a
stranger to the respondent No.1/plaintiff, the appellant/defendant No.1 owed
a duty to reply to the legal notice.
19. I may in this regard notice that the Director of the appellant/defendant
No.1 in his cross-examination also has admitted the receipt of the notice.
20. I am unable to fix liability on the sole factor of non-reply to the legal
notice. It may be noticed that though the appellant/defendant No.1 may
have had relationship with the father of the respondent No.1/plaintiff of
financing of vehicles but the said relationship cannot be equated to the
relationship with respect to the subject vehicle. It is well nigh possible that
the appellant/defendant No.1 finding the notice received by it to be not
concerning any vehicle in which it had an interest, chose not to respond
RFA No.552/2005 Page 12 of 15
thereto. Viz.-a-viz. the said vehicle, the appellant/defendant No.1 indeed
was a stranger.
21. Without the respondent No.1/plaintiff establishing that the vehicle
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was seized on 29 /30 November, 2000 by the appellant/defendant No.1
and was transferred by the appellant/defendant No.1 to the other
respondents/defendants No.2 & 3, no liability for illegal seizure and illegal
retention of the vehicle can be fastened on the appellant/defendant No.1.
There is absolutely no such evidence. The argument at this stage also raised
by the counsel for the respondent No.1/plaintiff is of the respondent
No.1/plaintiff having not proved having at the time of return of the original
Registration Certificate of the vehicle delivered the requisite form to enable
the respondent No.1/plaintiff to have the said endorsement removed or to
the Transport Department for the said purpose.
22. I am unable to agree. Even if that be so, there is nothing to show that
the respondent No.1/plaintiff at any time called upon the
appellant/defendant No.1 to do so. The learned ADJ has in para 13 of the
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impugned judgment given the date of the said endorsement as 12 February,
2001. Finding the same to be incongruous with the case of the respondent
No.1/plaintiff, I have scanned the Trial Court record and do not find the said
RFA No.552/2005 Page 13 of 15
date neither in the pleadings nor in the evidence led. The date of the
endorsement of hypothecation in favour of the appellant/defendant No.1 on
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the Registration Certificate appears to be 12 February, 2000 and not 12
February, 2001 as also confirmed from the copy of Form 34-A claimed to
have been handed over by the appellant/defendant No.1 to the respondent
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No.1/plaintiff and the date whereof is 17 February, 2000. Admittedly,
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after 12 February, 2000 the vehicle was being plied by the respondent
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No.1/plaintiff till the alleged seizure on 29 /30 November, 2000. The
respondent No.1/plaintiff for the said long span of time did not deem it
appropriate to have the endorsement changed. Thus, mere factum of the
said endorsement cannot link the appellant/defendant No.1 to the seizure
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even if any of the vehicle on 29 /30 November, 2000. Rather, there is no
evidence at all to show that the vehicle was so seized on that date. All that
has been proved is that the vehicle was seized by the police on the
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complaint of the respondent No.1/plaintiff on 28 February, 2002 and at that
time it was being plied by the driver of the respondent/defendant No.2.
23. The judgment of the learned ADJ thus, insofar as against the
appellant/defendant No.1, cannot be sustained and is set aside.
24. The appeal is accordingly allowed; the impugned judgment and
RFA No.552/2005 Page 14 of 15
nd
decree dated 2 February, 2005 insofar as against the appellant/defendant
No.1 is set aside. However in the facts and circumstances, I refrain from
imposing any costs on the respondent No.1/plaintiff.
Decree sheet be drawn up.
RAJIV SAHAI ENDLAW, J.
SEPTEMBER 23, 2013
bs..
RFA No.552/2005 Page 15 of 15