TMI Blog2020 (10) TMI 1347X X X X Extracts X X X X X X X X Extracts X X X X ..... in force, or undertaken to be performed by a person, in pursuance of a contract or otherwise, in relation to any service. The hire purchase agreement, a copy of which is annexed to the Paper Book, clearly enabled the Financier to take possession of the vehicle, on default in payment of any of the instalments. There is no term in the Hire Purchase Agreement, that requires the Financier to give notice to the Complainant before terminating the Hire Purchase Agreement, upon breach of any term thereof, or before taking possession of the vehicle - the repossession of a vehicle under hire, in accordance with the terms and conditions of a hire purchase agreement, upon default in payment of hire instalments and refusal to release the same on mere assurance of the Complainant to clear outstanding arrears of hire instalments, and pay future instalments in time, does not constitute deficiency in service. The object of a notice before taking possession of a vehicle on hire under a Hire Purchase Agreement, is to enable the hirer, to make a written request to the Financier to revive the hire purchase agreement in terms of Clause 12 of the said agreement, upon payment of all outstanding du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... determined from the terms of the agreement, considered in the light of surrounding circumstances. However, even a loan transaction, secured by right of seizure of a financed vehicle, confers licence to the Financier to seize the vehicle - In this case, the agreement executed by and between the Financier and the Complainant is a Hire Purchase Agreement as will appear from the terms and conditions thereof. In any event, the fora under the Consumer Protection Act, have not arrived at any specific finding to the contrary. There is no discussion of the nature of the agreement between the Financier and the Complainant. Be that as it may, the agreement clearly permits the Financier to take possession of the vehicle, upon default in payment of instalments. In the instant case, there is no evidence of any loss suffered by the complainant by reason of non-receipt of notice. Admittedly, several instalments, remained unpaid. After repossession the complainant contacted the Financier and was informed of the reasons for the repossession. He only made an offer to pay outstanding instalments and gave an assurance to pay future instalments in time. If the Financier was not agreeable to accept t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ri [hereinafter referred to as the Complainant ], and directed the Financier to pay Rs. 2,23,335/- to the Complainant, along with interest at 10% per annum, Rs 10,000/- towards physical and mental injury and Rs 1000/- as litigation expenses. 2. On or about 2nd August 2002, the Complainant entered into a hire-purchase agreement with the Financier, then known as Magma Leasing Ltd. for hire-purchase of a Mahindra Marshal Economic Jeep bearing the Registration No. UP-42-T/1163, which is hereinafter referred to as the vehicle , the cost whereof was Rs.4,21,121/- of which the complainant made an initial payment of Rs.1,06,121/-. According to the Financier, an amount of Rs.1,04,000/- from out of the initial payment of Rs.1,06,121/- was paid by the complainant to the dealer directly. The balance amount of Rs.3,15,000/- was paid by the Financier. 3. The Complainant agreed to repay a sum of Rs.4,38,585/- whichwas inclusive of finance charges of Rs.83,650/- to the Financier in 35 monthly instalments of Rs.12,531/-, commencing from 1st August, 2002. The monthly instalments were to be paid till 1st June, 2005. The Complainant apparently deposited post dated cheques of Rs.12,531/-. 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry of the Hired Article. b) MAINTENANCE Maintain and keep the Hired Article in good and serviceable condition at his own cost. The company and/or its Bankers shall have all the rights to inspect and to call for the Hired Article to be produced at any time for any time for any reason whatsoever. The Hirer shall be responsible and liable for damage, if any, caused to the Hired Article and/or to any other third party. c) LOCATION Keep the Hired Article at the Hirer s said premises and shall permit the company and/or its agent at all times to enter upon any premises at which the Hired Article is kept/parked for the purpose of verification and also repossession the Hired Article under the provisions of clause 15 of this agreement and shall not under any circumstances change the location of the Hired Article, without express approval of the company. d) INSURANCE Insure and keep comprehensively insured the Hired Article in the name of the company and/or its Banker against loss or damage by fire, accident, flood, earthquake, theft or any other cause and including against third party claims with an insurance company for the full cost of the Hired Article, such insurance po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d when the occasion so arises. f) ALIENATION OF HIRED ARTICLE Ensure not to sell, assign, mortgage, pledge, hypothecate or otherwise deal with the Hired Article or any part thereof, to part with possession of the Hired Article without the express written permission of the company previously obtained and not to use the Hired Article for any purpose other than that declared in the application. g) .. h) . i) . j) . 04. .. 05. LOSS AND DAMAGE In the event of the Hired Article, being from any cause whatsoever, wholly lost to the company during the said hiring, the measure of damages as admitted to be payable by the Hirer to the company shall be the aggregate of all arrears amounts. If any, and the total amount of the installment which would have been payable during the residue of the said hire purchase form. For the purpose of this clause, the Hired Article, if damaged and not forthwith repaired and restored to its original condition, shall be deemed to be wholly lost to the company. However, every opportunity and reasonable time shall be given to the hirer to restore the Hired Article to working condition subject to the hirer continuing to pay the h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing the same and/or as a consequence of the agreement being determined and such request may be entertained by the company at its absolute discretion and upon such further or other terms as it thinks fit and proper in the circumstances. The company shall be under no compulsion to accept the request for revival of this agreement as stated supra. 13. 14. .. 15. DETERMINATION In case the Hirer shall during the continuance of this agreement do or suffer one or more of the following:- a) Fail to pay any of the hire installments or the interest or other amounts (for example; insurance premium, expenses incurred for collection of installments, additional taxes, additional, finance charges for late payment of installments etc.) having fallen due hereunder within 7 (seven) days of the amount falling due for payment whether demanded or not; b) . c) . d) pledge or mortgage or hypothecate or sell or attempt to pledge or sell or part with possession of or otherwise alienate or transfer the said Hired Article; e) . f) fail to keep the said Hired Article comprehensivelyinsured as agreed hereinbefore during the period of the agreement. g) fail to pay to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ul possession of the property by the Hirer and an offence within the purview of the provisions of the Indian Penal Code. 5. It is not in dispute that the Complainant defaulted in payment of instalments. Even though the Complainant was required to pay the first instalment within 1st August, 2002 and the subsequent instalments within the 1st of each succeeding month, the Complainant did not adhere to the schedule of repayments, which according to the Financier, was of essence to the hire-purchase agreement. Post dated cheques deposited by the Complainant were, according to the Financier, dishonoured. 6. In the circumstances, the Financier took re-possession of the vehicle on 14th July, 2003, allegedly upon notice to the Complainant, and in accordance with the conditions of the hire-purchase agreement. The factum of notice is, however, disputed by the Complainant. 7. After taking re-possession of the vehicle, the Financier called upon the Complainant to clear his outstanding dues amounting to Rs.2,80,132.59 as on the date of the notice, failing which the vehicle would be disposed of. 8. A pre sale legal notice dated 26.07.2003 was allegedly sent by the Financier to the Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mely. But Opposite party No.2 does not heard it And refused to give vehicle. Provision-9 That the Applicant/Complainant was Surprised with this behaviour of Opposite party No.2 and did correspondence with Administration And Government in relation to this. That Inspection was also conducted But There was no result of all this. Provision-10 That Applicant has done correspondence with Opposite party no.1 and tell the complete situation but Applicant vehicle was not given to Applicant again but it was sold to some other person. Applicant has done very much helter-skelter in relation to this But no result of all these. Provision-11 That the Applicant is been Continuously being upset and shocked by Opposite party no 1 and 2. Beside Assuring that he will pay all the past due Installment soon and will pay all other Installment timely, although vehicle was not Released in the favour of Applicant by Opposite party. That come under the Category of Business Misconception. In Unfair Trade Practice Act. And Due to Deficiency in Service. It is also Come Under Consumer Protection Act And Sustainable before The Honourable Court. . Provision-13 That due to Opposite party acts Applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ught the opportunity to clear the outstanding instalments, and pay future instalments within time. [Paragraphs (8) and (11) of the complaint]. 13. The vehicle was sold in November 2003. Till then, the Complainant did not even clear the instalments outstanding upto July 2003, that is, the outstanding instalments for the period during which the vehicle was in the possession of the Complainant, not to speak of any further instalments. 14. By an order dated 22nd August 2008, the District Forum allowed the Complaint and directed the Financier to pay Rs.2,23,335/- to the Complainant, along with simple interest at 10% per annum from the date of filing of the complaint till payment as also Rs.10,000 towards damages for physical and mental agony and Rs.1000/- as litigation expenses, within 45 days from the date of the order. 15. Being aggrieved by the order of the District Forum allowing the complaint, and directing the Financier to pay the Complainant the entire amount paid by the Complainant to the Financier towards instalments and other charges as well as the sum of Rs.1,04,000/paid by the Complainant directly to the dealer, along with interest at 10% per annum, damages of Rs.10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, whether service of proper notice on the hirer is necessary for repossession of a vehicle which is the subject of a hire purchase agreement, and if so, what is the consequence of non service of proper notice. 20. Before dealing with the aforesaid questions involved, in this appeal, it may be pertinent to refer to the relevant provisions of the Consumer Protection Act, 1986, set out hereinafter for convenience. 21. The Consumer Protection Act, 1986 has been enacted to protect the interests of consumers, by making provisions for the establishment of Consumer Councils and other fora for speedy redressal of consumer disputes and for matters connected therewith. The Consumer Protection Act, 1986 as per its Statement of Objects and Reasons placed before Parliament, has been enacted to promote and protect the rights of consumers such as: (a) the right to be protected against marketing of goods which are hazardous to life and property; (b) the right to be informed about the quality, quantity, potency, purity, standard and price of goods to protect the consumer against unfair trade practices; (c) the right to be assured, wherever possible, access to variety of goods at com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... due diligence that thegoods so offered are unsafe to the public; (vi) services which are hazardous or likely to be hazardous to life and safety of the public when used, are being offered by the service provider which such person could have known with due diligence to be injurious to life and safety. with a view to obtaining any relief provided by or under this Act; (d) consumer means any person who,- (i) buys any goods for a consideration which has been paid orpromised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or (ii) hires or avails of any services for a consideration which hasbeen paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r services; (vii) .. (viii) makes to the public a representation in a form thatpurports to be- (i) a warranty or guarantee of a product or of any goods orservices; or (ii) a promise to replace, maintain or repair an article orany part thereof or to repeat or continue a service until it has achieved a specified result, if such purported warranty or guarantee or promise is materially misleading or if there is no reasonable prospect that such warranty, guarantee or promise will be carried out; (ix) materially misleads the public concerning the price atwhich a product or like products or goods or services, have been or are, ordinarily sold or provided, and, for this purpose, a representation as to price shall be deemed to refer to the price at which the product or goods or services has or have been sold by sellers or provided by suppliers generally in the relevant market unless it is clearly specified to be the price at which the product has been sold or services have been provided by the person by whom or on whose behalf the representation is made; (x) gives false or misleading facts disparaging the goods,services or trade of another person. Explanation.-For the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich the scheme was originally advertised; (4) permits the sale or supply of goods intended to be used, orare of a kind likely to be used, by consumers, knowing or having reason to believe that the goods do not comply with the standards prescribed by competent authority relating to performance, composition, contents, design, constructions, finishing or packaging as are necessary to prevent or reduce the risk of injury to the person using the goods; (5) permits the hoarding or destruction of goods, or refuses tosell the goods or to make them available for sale or to provide any service, if such hoarding or destruction or refusal raises or tends to raise or is intended to raise, the cost of those or other similar goods or services; (6) manufacture of spurious goods or offering such goods forsale or adopting deceptive practices in the provision of services. Section 3. Act not in derogation of any other law.-The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force. Section 11. Jurisdiction of the District Forum.- (1) Subject to the other provisions of this Act, the District Forum shall have jur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of being heard has been given to the complainant: Provided further that the admissibility of the complaint shall ordinarily be decided within twenty-one days from the date on which the complaint was received. (4) Where a complaint is allowed to be proceeded with undersub-section (3), the District Forum may proceed with the complaint in the manner provided under this Act: Provided that where a complaint has been admitted by the District Forum, it shall not be transferred to any other court or tribunal or any authority set up by or under any other law for the time being in force. Explanation.-For the purposes of this section, recognised consumer association means any voluntary consumer association registered under the Companies Act, 1956 (1 of 1956) or any other law for the time being in force. Section 13. Procedure on admission of complaint.- (1) (2) The District Forum shall, if the complaint admitted by it under Section 12 relates to goods in respect of which the procedure specified in sub-section (1) cannot be followed, or if the complaint relates to any services,- (a) refer a copy of such complaint to the opposite party directinghim to give his ver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of the following matters, namely:- (i) the summoning and enforcing the attendance of anydefendant or witness and examining the witness on oath; (ii) the discovery and production of any document or othermaterial object producible as evidence; (iii) the reception of evidence on affidavits; (iv) the requisitioning of the report of the concerned analysis ortest from the appropriate laboratory or from any other relevant source; (v) issuing of any commission for the examination of any witness;and (vi) any other matter which may be prescribed. (5) Every proceeding before the District Forum shall be deemedto be a judicial proceeding within the meaning of Sections 193 and 228 of the Indian Penal Code (45 of 1860), and the District Forum shall be deemed to be a civil court for the purposes of Section 195, and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974). (6) Where the complainant is a consumer referred to in subclause (iv) of clause (b) of sub-section (1) of Section 2, the provisions of Rule 8 of Order I of the First Schedule to the Code of Civil Procedure, 1908 (5 of 1908) shall apply subject to the modification that every reference the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount so obtained shall be credited in favour of such person and utilized in such manner as may be prescribed; (hc) to issue corrective advertisement to neutralize the effect of misleading advertisement at the cost of the opposite party responsible for issuing such misleading advertisement; (i) to provide for adequate costs to parties. (2) Every proceeding referred to in sub-section (1) shall be conducted by the President of the District Forum and at least one member thereof sitting together: Provided that where a member, for any reason, is unable to conduct a proceeding till it is completed, the President and the other member shall continue the proceeding from the stage at which it was last heard by the previous member. Section 15. Appeal.- Any person aggrieved by an order made by the District Forum may prefer an appeal against such order to the State Commission within a period of thirty days from the date of the order, in such form and manner as may be prescribed: Provided that the State Commission may entertain an appeal after the expiry of the said period of thirty days if it is satisfied that there was sufficient cause for not filing it within that period: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order made by the District Forum to the StateCommission; (b) the order made by the State Commission to the NationalCommission; and (c) the order made by the National Commission to the SupremeCourt. (2) Except as aforesaid, no appeal shall lie to any court from anyorder of a District Forum or a State Commission or the National Commission. (3) Every appeal under this section shall be preferred within aperiod of thirty days from the date of an order of a District Forum or a State Commission or, as the case may be, the National Commission: Provided that the State Commission or the National Commission or the Supreme Court, as the case may be, may entertain an appeal after the expiry of the said period of thirty days, if, it is satisfied that the appellant had sufficient cause for not preferring the appeal within the period of thirty days. 24. Section 11 of the Consumer Protection Act confers jurisdiction on the District Forum, having territorial jurisdiction, to entertain a complaint, subject to the pecuniary limit of the value of the goods or services and/or the compensation claimed. In this case the territorial or the pecuniary jurisdiction of the District Forum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Financier, the ownership of the vehicle remained with the Financier. 29. The hire purchase agreement, a copy of which is annexed to the Paper Book, clearly enabled the Financier to take possession of the vehicle, on default in payment of any of the instalments. There is no term in the Hire Purchase Agreement, that requires the Financier to give notice to the Complainant before terminating the Hire Purchase Agreement, upon breach of any term thereof, or before taking possession of the vehicle. 30. On the other hand, clause 15 of the Hire Purchase Agreement expressly provides for determination of the Hire Purchase Agreement without notice to the Complainant, upon default in hire instalments. Clause 15 enables the Financier and/or its agent to enter the premises of the Complainant, where the vehicle under hire may be lying, and to take possession of the same. 31. The repossession of a vehicle under hire, in accordance with the terms and conditions of a hire purchase agreement, upon default in payment of hire instalments and refusal to release the same on mere assurance of the Complainant to clear outstanding arrears of hire instalments, and pay future instalments in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sures that the hirer is not taken by surprise and has time to stop operating the vehicle, so that third persons using the vehicle on payment of charges are not put to sudden inconvenience by reason of re-possession of the vehicle. 37. On the face of the averments in the Complaint, the Complainant had approached the Financier after possession of the vehicle was taken, to be told that the Financier had taken possession of the vehicle, as the Complainant had defaulted in payment of instalments. The Financier had not agreed to release the vehicle, on the assurance of the Complainant to clear outstanding instalments and to pay future instalments in time. 38. A District Forum constituted under the Consumer Protection Act, 1963, derives its power to grant relief from Section 14 of the said Act. If the District Forum is satisfied that the allegations contained in the complaint about the services are proved, it may direct the service provider to (i) return the charges paid by the Complainant [Section 14(1) (c)]; (ii) to pay such amount, as may be awarded by the District Forum as compensation to the consumer for any loss or injury suffered by the Complainant/Consumer, due to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Agreement for taking the vehicle back or selling it to a third party. Significantly it was not even the case of the Complainant in his complaint, that the Hire Purchase Agreement, which the complainant had signed, did not authorize the Financier to take possession of the vehicle upon default, or to sell the same to a third party. 43. No adverse inference could have been drawn against the Financier for not producing the Hire Purchase Agreement before the District Forum, when there was no allegation in the complaint of breach by the Financier of the Hire Purchase Agreement, in taking possession of the vehicle. The District Forum did not exercise its power under Section 13(4)(ii) to call upon the Financier to produce the Hire Purchase Agreement. Even otherwise, the District Forum did not direct the Financier to produce the Hire Purchase Agreement. 44. In the Complaint, a copy of which is annexed to the Paper Book, there is not a whisper of application of any force in taking possession of the vehicle. The finding of the District Forum, of the vehicle having been lifted forcefully or snatched is, with the greatest of respect, contrary to the Complainant s own case made out i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ier, to divulge details of the sale of that vehicle, and that too on its own, without being called upon to do so. 49. The finding of the State Commission that the Financier sold the vehicle without the knowledge of the Complainant is contrary to the Complainant s own case in his complaint before the District Forum. The Complainant has in his complaint alleged that:- (i) The Complainant contacted the office of the Financier, to be told that the vehicle had been lifted, as instalments were due. (ii) The Financier refused to return the vehicle on the assurance of the Complainant to clear all the outstanding instalments and to pay instalments timely in future. (iii) The Complainant entered into correspondence with the Financier and explained his situation, but the vehicle was not returned. 50. The Complainant has established that there was a discrepancy and/or error in the address of the Complainant in the notice for repossession, from which all the three fora under the Consumer Protection Act, 1986, that is the District Forum, the State Commission and the National Commission have concluded that possession of the vehicle was taken without notice. It was not the case of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r expeditious adjudication and settlement of consumer disputes, is not in derogation of any law in existence, but in addition thereto, as provided in Section 3 thereof. The said Act protects consumers of services from being charged a price in excess of the price fixed for the service under any law or the price agreed between the parties and also redressal of deficiency in the services availed by the Consumer and/or against restrictive or unfair trade practices, and/or spurious services. 56. The Consumer Protection Act, 1986 does not override the Contract Act, 1872, and other enactments in force, applicable to the service availed by the consumer from the service provider. 57. The protection, to which the consumer of a service is entitled under the Consumer Protection Act, is against loss of money, by reason of being denied service, of a quality agreed upon expressly or by necessary implication, inter alia, in view of the applicable law, for which the consumer has paid, or has agreed to pay a consideration. The said Act also protects consumers from being overcharged for any service obtained and/or agreed to be obtained. 58. The consumer of a service may also be entitled to d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for punishment of the party in breach, by imposition of punitive and/or exemplary damages. Compensation which is compensatory, has to be assessed taking into account relevant factors, such as the loss incurred by the claimant, though some amount of guess work and/or estimation may be permissible. In the instant case, the District Forum did not even undertake the exercise of assessment of the loss/damages, if any, suffered by the complainant by reason of non-service of notice before taking possession of the vehicle. 63. The District Forum, as also the State Commission and the National Commission, did not consider the law relating to hire purchases as enunciated by this Court in a plethora of judgments. 64. Charanjit Singh Chadha Ors. v. Sudhir Mehra (2001) 7 SCC 417, relied upon by the Financier, this Court held: 5. Hire-purchase agreements are executory contracts under which the goods are let on hire and the hirer has an option to purchase in accordance with the terms of the agreement. These types of agreements were originally entered into between the dealer and the customer and the dealer used to extend credit to the customer. But as hirepurchase scheme gained in popu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pays for use of the goods and for the option to purchase them. The finance charge, representing the difference between the price and the hire purchase price represents the sum which the hirer has to pay for the privilege of being allowed to pay the purchase price in instalments. Where the hirer had defaulted in payment of instalments and the agreement specifically provided that the Financier was entitled to repossess the vehicle in case of default, no case was made out against the Financier. 66. In K.L. Johar Co. v. Deputy Commercial Tax Officer, Coimbatore AIR 1965 SC 1082 this Court took the view that a hire-purchase agreement has two elements: (1) element of bailment; and (2) element of sale, in the sense that it contemplates an eventual sale. The element of sale fructifies when the option is exercised by the intending purchaser after fulfilling the terms of the agreement. When all the terms of the agreement are satisfied, and the option is exercised, a sale takes place of the goods, which till then, had been hired. 67. Anup Sarmah v. Bhola Nath Sharma and Others (2013) 1 SCC 400 citedon behalf of the Financier, this Court held that, in an agreement of hire-purchase, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that merely because a civil claim was maintainable did not mean that the criminal complaint would not be maintained. The Judgment was rendered in the context of the allegation that the respondent Nos. 2 and 10 had fraudulently got the father of the complainant to execute a gift deed. The judgment is of no relevance to this case. 73. In Sundaram Finance Ltd. v. The State of Kerala Anr. AIR 1966 SC 1178 the majority of the Judges held that, the true effect of a transaction might be determined from the terms of the agreement, considered in the light of surrounding circumstances. An owner of goods, who purports absolutely to convey or acknowledges to have conveyed goods, and specifically purports to hire them under a Hire Purchase Agreement, is not estopped from proving that the real bargain was a loan on the security of the goods. If there is a bona fide and completed sale of goods, evidenced by documents, anterior to and independent of a subsequent and distinct hiring to the vendor, the transaction may not be regarded as a loan transaction, even though the reason for which it was entered into, was to raise money. If the real transaction is a loan transaction, secured by a righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ancier, as the case may be, could terminate the agreement and take back the goods. In such a transaction, the common intention of the dealer, the financier and the customer was that the transaction should take the form of a hire-purchase agreement which would become a sale on the compliance of the terms of that agreement. No doubt the financing operation could have taken the form of a mortgage or pledge, but the parties, for their mutual benefit and convenience, entered into a hirepurchase transaction. 7. In the absence of any fraud or undue influence, the question resolves itself into a simple question of intention. The transactions were in accordance with the mercantile usage. Both the financier and the customers with open eyes entered into the transactions of hire-purchase. Their intention was expressed in clear terms. They could have executed hypothecation bonds, but they did not, and instead entered into hire-purchase transactions. There was no reason to camouflage the real nature of the transactions. None was suggested. They were, therefore, bound by the terms of the agreements. 77. The law which emerges from the judgments of the Court referred to above, is that goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , where the borrower might have committed default in payment of instalments. This Court held:- 16. Before we part with this matter, we wish to make it clear that we do not appreciate the procedure adopted by the Bank in removing the vehicle from the possession of the writ petitioner. The practice of hiring recovery agents, who are musclemen, is deprecated and needs to be discouraged. The Bank should resort to procedure recognized by law to take possession of vehicles in cases where the borrower may have committed default in payment of the instalments instead of taking resort to strong-arm tactics. 84. The Judgment was rendered in the facts and circumstances of the case where it was alleged that possession of a truck had been taken, by engaging goons and musclemen as Recovery Agents. The disputes were settled before this Court in view of the submission of Counsel that the truck could be returned upon payment of a sum of Rs.50,000/- 85. In Citicorp Maruti Finance Ltd. v. S. Vijaylaxmi (2012) 1 SCC 1 cited by the complainant, this Court held that the fora under the Consumer Protection Act, 1986 were right in holding that the vehicles had been illegally and wrongfully recove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quirement to give notice is implicit in the agreement from the course of conduct of the parties. 89. If the hirer commits breaches of the conditions of a hire purchase agreement which expressly provides for immediate repossession of a vehicle without further notice to the hirer, in case of default in payment of hire charges and/or hire instalments repossession would not be vitiated for want of notice. In this case, however a duty to give notice to the Complainant before repossession, was implicit in the Hire Purchase Agreement. The Hire Purchase Agreement was a stereotype agreement in a standard form, prepared by the Financier. The same kind of agreements, containing, identical terms, except for minor modifications are executed by all hirers of vehicles, equipment, machinery and other goods, who enter into hire purchase agreements with the Financier. The Financier who set down the terms and conditions of the hire purchase, construed the hire purchase agreement to contain an implied term for service of notice and accordingly despatched a notice, but did not address it to the correct address of the Complainant as given in the hire purchase agreement. 90. In a case where the req ..... X X X X Extracts X X X X X X X X Extracts X X X X
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