( 1 ) IN this petition filed, under Sec. 482 Crlpc, the order d 2-1-1978 passed by the Judicial Magistrate, First Class (II Court) Mangalore, Dak-shina Kannada, in directing handing over possession of a motor cap (Premier Padmini) bearing registration No MEN 399 to respondent-2, is challenged. ( 2 ) THIS petition has been filed on 4-1-78. Sri Mohandas N. Hegde, learned advocate appearing for the petitioner submitted that he may be permitted to argue the petition as if it is a criminal revision petition because, it has been filed under Sec 482 of the Crlpc due, to misconception of the effect of Sec. 397 ( (2) of the Crlpc, 'but that misconception has begin recently removed as the law came to be settled by the Supreme Court in december 1977. The permission is granted and this petition is heard and disposed of in exercise of the revisional jurisdiction of this Court. ( 3 ) THE undisputed facts are that respondent-2 Mary Georgel is the wife of C. X. George (now deceased ). C. X. George entered in to a hire purchase agreement with the petitioner finance company and secured possession of the car aforementioned as per the terms of the, agreement. He went on abiding by the terms. It may be stated that the registration certificate of the vehicle was made out in the name of C. X. George. Even after his death, respondent made payments towards the instalments and the amounts so paid by her totalled to about Rs. 6,000. Later on one C. X. Alexander, who is a brother of late C. X. George and who is not a party to this petition, filed, a complaint before the police that the said car had been stolen by about 5. 00 p. m. on 4-12-77 when the same had been parked and when he and the members of his family had gone to Church. In the meantime the petitioner intimated the Regional Transport Officer that as there was deffault in regard to payment of instalments as per the hire purchase agreement the Company had secured possession of the car and, as the certificate of registration was not available to them-the same being with the registered owner and the registered owner had not returned it to them-the necessary endorsements in the certificate of registration be cancelled and a duplicate be issued in their name. They produced the car before the police and the police seized it. When the car was produced before the Magistrate, the petitioner, respondent-2 and Alexander filed applications purporting to be under Secs. 451 and 457 of the Crlpc claiming that each one of them was entitled to the possession of the car and it may be handed over to their possession. The learned Magistrate after considering the, said application produced the impugned order and he has styled it - as an order made under sec. 451 of the Crlpc. It may be mentioned at this stage itself that the magistrate has, in fact, exercised his powers under Sec. 457 of the Crlpc and appears to have wrongly thought that he had passed the order under sec. 451 of the, Criminal Procedure Code. ( 4 ) NO charge sheet had been filed before the Magistrate. Only the FIR was before the Magistrate. Therefore Sec. 457 of the Crlpc would apply and not Sec. 451 of the Crlpc. The hire purchase agreement and the necessary documents had been produced before the Magistrate while he passed the impugned order. ( 5 ) THE contention on behalf of the petitioner is, before the Magistrate and here as well, that the petitioner had purchased, the car from the dealer and therefore, it had become the owner and on C. X. George entering into the hire purchase agreement with them, they had handed, over possession of the car to him on hire and if he had abided by all the terms of the agreement, he would have ultimately become the owner and further that one of the) terms viz, term No. 12 of the agreement made it necessary for them to intimate the, RTO to register the name of C. X. George as the registered owner in the certificate of registration, and as such his name came to be registered as owner and that he was not the defacto owner but only a registered owner. It is on the basis of this contention they claim to be the real owners and entitled to possession. Further, in support of this contention another relevant term in the hire purchase, agreement was made use of by the petitioner. 'that term is to the effect that whenever default is made in the payment of instalments, the petitioner was entitled to take possession of the car from wherever it stood. Further, in support of this contention another relevant term in the hire purchase, agreement was made use of by the petitioner. 'that term is to the effect that whenever default is made in the payment of instalments, the petitioner was entitled to take possession of the car from wherever it stood. Sri Tukaram S. Pai, learned Counsel appearing on behalf of respondent-2 argued that the fact that the name of C. X. Geprge has been admittedly'shown in. the certificate of registration as the registered owner is by. itself sufficient to establish prima facie that he was the owner of the car and in fact, it was in the possesston, of his wife viz, respondent-2, and it was from her possession the petitioner took away the car and therefore, she, was entitled, to the possession of the car. The learned Magistrate has, in the course of "his order referred to the decisions in K. L. Johar and Co v. Deputy Comml Tax Officer AIR. 1965 SC. 1082. , Sundaram finance Ltd v. State of Kerala AIR. 1966 SC. 1178 and D. V. Corpn v. State of Bihar AIR. 1961 SC. 440. He has reasoned that when the principles laid down in the aforementioned decisions were taken into consideration, he was convinced that respondent-2's husband was the owner; that after his death, respond,ent-2 became the owner and the, car had been taken from out of her possession, and, therefore she was entitled to possession. The Supreme Court has, in the aforementioned decisions, gone into the question of hire purchase agreement while considering the liability to pay sales tax. ( 6 ) IN my opinion, it would be at this stage, necessary to look into the provisions of the Motor Vehicles Act, 1939 regarding the, hire purchase agreement registration of a vehicle and the effect of endorsement of hire purchase agreement in the, registration certificate, and under what circumstances, the same should be changed, sec. 2 (19) of the Motor Vehicles Act, 1939 (hereinafter referred to as the, Act) reads as follows '. owner' means, where the person tn possession of a motor vehicle is a minor, the guardian, of such minor, and in relation to a motor vehicle which is the subject of a hire purchase agreement, the person in possession of the vehicle under that agreement. owner' means, where the person tn possession of a motor vehicle is a minor, the guardian, of such minor, and in relation to a motor vehicle which is the subject of a hire purchase agreement, the person in possession of the vehicle under that agreement. Sec. 24 of the Act lays down that an application by or on, behalf of the owner of a motor vehicle for registration shall be in Form B as set forth "in the First Schedule, shall contain, the information required by that form and shall be accompanied by the prescribed. Thereafter, the provisions deal with the registration of a vehicle in favour of the owner who has submitted such an application. ( 7 ) IN view of the provisions in Secs. 22 and 24 of the Act, it is plain that for all practical purposes, a person who is shown as the registered owner in the certificate of registration is the owner of the vehicle. But Sec. 2 (19) of the Act makes out an exception by widening the meaning of the word 'owner' to the effect that a person who is in possession of the concerned vehicle which is the subject of hire purchase agreement, is also the owner for the purposes of the Act. Therefore, a person who is in possession of a vehicle, which is a subject of hire purchase agreement, can submit an application as per Sec. 24 of the Act and get his name entered, as the registered owner in the certificate of registration. This is to be borne, in mind while considering the claims of the parties in this case. ( 8 ) IT is appropriate as this stage itself to refer to two decisions relied upon by Sri Tukaram S. Pai learned Advocote for respondent-2. The first one is in T. C. Gopalan Nair v. P. Kelu 1973 (1) Myslj. 420. While considering Sec. 516a of the crlpc 1898 it has been held that against a person claiming to be in posr session and who has no document in his favour, the registered owner would be entitled to possession of the vehicle. There can be no quarrel about this proposition. The next decision is in Shantakumar v. Mohonlal 1969 (2) Mys LJ. There can be no quarrel about this proposition. The next decision is in Shantakumar v. Mohonlal 1969 (2) Mys LJ. 304 Therein the owner of a motor vehicle had entered into a hire purchase agreement with accused-1 and on default of payment of instalments, the accused had taken possession of the vehicle and the complainant had complained that offences under Secs. 379, 411 and 114, IPC had been committed. The case ended in discharge. The question arose was as to who was entitled to the possession of the vehicle. This Court has held that the ownership and title of the complainant was not in dispute and therefore, he was entitled to the possession of the vehicle. This principle would be of assistance to respondent-2 if she is able to show prima facie that she is the owner of the car. As already pointed out it is the contention of Sri tukaram S. Pai that because the name of the husband of respontent-2 is entered in the certificate of'registration, she is the owner and there is no material to show that at any point of time, the ownership had been transferred in favour of the petitioner. It is on this basis that Sri Tukaram has made use of the above cited decision. ( 9 ) THOUGH the learned Magistrate has cited three decisions of the Supreme i Court, the matter on hand can be understood and disposed of by looking into the decisions of the Supreme Court in K. L. johar andcos (1) and Sundaram Finance Case (2 ). In K. L. johar and Co's case (l) it has been laid down as follows : a hire purchase agreement is distinct from a sale in which the price is to be paid later by instalments. In the case of a sale in which the price is to be paid by instalments, the property passes as soon as the sale, is made, even though the price has not beien fully paid and may later be paid in instalments. The essence, of a sale is that the property is transferred from the seller to the buyer for a price, whether paid at once or paid later in instalments. On the other hand, a hire purchase agreement, as its very name implies, has two aspects. The essence, of a sale is that the property is transferred from the seller to the buyer for a price, whether paid at once or paid later in instalments. On the other hand, a hire purchase agreement, as its very name implies, has two aspects. There is first an aspect of bailment of the goods subjected to the hire purchase agreement and there is next an element of sale which fructifies when the option to purchase, which is usually a term of hire purchase agreements, is exercised by the intending purchaser. Thus the intending purchaser is known as the hirer so long as the option to purchase is not exercised and the essence of a hire purchase agreement properly so called is that the property in the goods does not pass at the time of the agreement but remains in the intending seller and only passes later when the option is exercised by the intending purchaser. The distinguishing feature of a hire-purchase agrejement is that the property does not pass when the agreement is, made but only passes when, the option is finally exercised after complyng with all the terms of the agreement. ( 10 ) IT has been further laid down as follows : 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. Whew all the terms of the agreement are satisfied, and the option ts exercised, 13, sale takes place of the goods which till then had been hired. When this sale takes place it will be liable to sales tax under the Act for the taxable event under the Act is the taking place of the Sale, the Act providing for a multi-point sales tax at the relevant time. Where, however, option is not exercised or cannot be exerciseid because of the inability of the intending purchaser to fulfil the terms of the agreement, there is no sale at all. As the taxable event is the sale of goods, the tax can only be levied when the option is exercised after fulfilling all the terms of the hire, purchase aggreement. As the taxable event is the sale of goods, the tax can only be levied when the option is exercised after fulfilling all the terms of the hire, purchase aggreement. Even though eventually most cases of hire purchase, may result in sales by the exercise of the option and the fulfilment of the terms of the agreement, tax is not exigible at the time when the hire purchase agreement is made for at that time the taxable event has not taken plajce it can only be exigible when the option has been exercised and all the terms of the agreement fulfilled and the sale actually takes place When sale takes place in a particular case will depend upon the terms of the hire purchase agreement, but till the sale, takes place there can be no liability to sales tax under the Act. In Sundaram Finance Ltd's case (2) the Bench consisted, of K. Subba rao, J. C. Shah and S. M. Sikri, JJ. Sundaram Finance Co had been assessed to sales tax on a particular transaction and the High Court of Kerala rejected the petition of Sundaram Finance Co and they took up the matter to the Supreme Curt. The matter involved a hire purchase agreement. The salient features of that agreement are narrated in paragraph-15 of the majority judgment as follows : a customer desirous of purchasing a motor vehcle, but unable to pay the price to the dealer agrees to purchase the vehicle and makes part payment of the price to the dealer and he then approaches the appellants and requests that a loan be advanced to him. On the appellants agreeing no grant a loan, the customer executes nine documents- (1) an application requesting the appellants to grant a loan of a stated amount on the secority of the motor vehicle (2) a sale letter' reciting that the customer had on the date of the application for loan sold to the appellants the motor Vehicle; (3) a bill which recites that for the amount mentioned in the 'sale letter' and received in full, the customer has sold to the appellants the vehicle belonging to the customer; (4) 'a receipt for the, appellants; (5) an agreement called the hire-purchase agreement under which the appellants agree to let out to the customer and the customer agrees to take on hire the motor vehicle for a specified term subject to determination in conditions mentioned therein; (6) a promissory note agreeing to pay the difference between the price of the vehicle and the amount paid by the customer to the dealer and interest thereon at the stipulated rate; (7) a letter from the customer requesting the appellants to pay to the dealer the amount agreed to be advanced to him; (8) a letter addressed to the appellants agreeing and undertaking to keep the vehicles on the security of which the loan, was granted insured aginst comprehensive risks; and (9) a letter addressed to the Motor Vehicles authorities intimating that the motor vehicle 'is the subject of hire purchase agreement between the customer 'as owner' and the appellants and, requesting the authorities to 'make note of the hire purchase agreement' in the registration certificate standing in the name of the customer. ( 11 ) IN view of this, the majority opinion was that the scheme for financing the purchase of the vehiclq was therefore that the customer purchases the vehicle from the dealer directly and gets it registered in his name. At his request the Sundaram Finance Ltd agreed to advance the balance of the price remaining to be paid and pay it to the dealer on the customer's executing a promissory note for repayment of the amount, a hire purchase agreement and other related documents and got them executed and on repayment of the amounts to be paid the vehicle became the sole and absolute property of the customer. ( 12 ) IT has been already mentioned that the hire purchase agreement entered into by C. X. George with the petitioner has been produced before the Magistrate. A copy of the same is made available to this-Court. It consists of 22 clauses. Perusal of the same has made it clear to me that the scheme of financing or whatever it may be, has been radically changed by Sundaram Finance Ltd from the scheme that was the subject matter of the decision in Sundaram Finance Ltd's case (2 ). As per the hire purchase agreement fn question the petitioner purchased the, vehicle from the dealer on behalf of hirer, who would be the intending purchaser from the petitioner paying certain initial amount. The balance of the amount could be paid to the dealer by the petitioner. That balance is made returnable to the petitioner by the hirer who is the intending purchaser from the petitioner by way of instalments. On full payment of the instalments he would become the absolute owner of the vehicle as having purchased the same from the petitioner. To safeguard the interest of the petitioner certain clause;s are provided. One of the clauses entitles the petitioner on the happening of certain events like default etc, to seize the vehicle from the possession of the, hirer. Clause-12 is to the effect that the owner viz, the petitioner, agrees to permit the hirer, who would be, C. X. George, to have the registration of the vehicle in his own name provided, that the hirer shall transfer the, registration in the name of the owner whenever required to do so by them and especially when the hirer commits a breach of any of the conditions of the agreement stated supra and the owner is obliged to seize the vehicle. ( 13 ) IN Sundaram Finance Ltd's case (2), the majority judgment was that there was one sale and that was between the dealer and the customer but not Sundaram Finance Ltd, and therefore, Sundaram Finance Ltd the appellant before the Supreme Court, was not liable to pay sales tax. It reversed, the judgment of the Kerala. High Court. ( 14 ) ALONG with the copy of the hire purchase agreement a duplicate invoice has been produced before, me for perusal. The original invoice, it is stated, has been produced before the learned Magistrate. It reversed, the judgment of the Kerala. High Court. ( 14 ) ALONG with the copy of the hire purchase agreement a duplicate invoice has been produced before, me for perusal. The original invoice, it is stated, has been produced before the learned Magistrate. It is clearly seen therefrom that the dealer has collected sales tax at 7 per cent from the petitioner while making an invoice for sale of the concerned vehicle in favour of the petitioner. The aforementioned facts have not been clearly grasped by the learned Magistrate while applying the principles laid down by the Supreme court in Sundaram Finance Ltd's case (2), and K. L. Johar and Co's case (l ). It is as clear as day light that as per the hire purchase agreement between the petitioner and C. X. George, the husband of respondent-2, the petitioner purchased the car in question for giving it on hire to C. X. George through the hire purchase agreement, the main clauses of which have been referred to in one of the earlier paragraphs, and then handed over possession of the very car to C. X. George as hirer on certain conditions. On C. X. George fulfilling the conditions as provided in the hire purchase agreement, he was to become the absolute owner of the vehicle. It is also plain that he was shown as the registered owner in the certificate of registration; because of clause-12 of the agreement and in view of the definition of the term 'owner' in Sec. 2 (19) of the Act. Therefore, the contention of Sri Tukaram S. Pai, that the name of C. X. George was shown as the registered owner in the certificate of registration because he was the, owner in the real sense, cannot be upheld. 14. It is undisputed, that the vehicle was seized from the possession of the petitioner. Wnen it is seen that they are the owners and they were entitled to possession even from C. X. George consequent upon certain defaults being committed, and it is further found that the police seized the vehicle from their custody, the Magistrate, ought to have, while exercising his powers under Sec. 457 of the Crlpc directed the vehicle to be returned to the possession of the petitioner. ( 15 ) IN the result, this petition is allowed and the order d /2-1-78 passed by the Judicial Magistrate, First Class (II Court) Mangalore, in FIR 456 of 1977 is set aside. It is hereby ordered that the vehicle viz, the car (Premier Padmini) bearing registration No. MEN 399 be returned to the possession of the petitioner, who is entitled to, the possession there of. --- *** --- .