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2015 DIGILAW 1616 (KER)

Reji v. State of Kerala

2015-11-25

MARY JOSEPH

body2015
ORDER : Mary Joseph, J. Petitioners are accused numbers 7 and 8 in C.P.No.65/2013 on the files of the Judicial First Class Magistrate Court, Alappuzha. They have approached this court seeking to quash all proceedings pursuant to registration of Crime No.284/2008 of Alappuzha South Police Station. In Crime No.284/2008 after concluding the investigation, Annexure A final report was laid by the Sub Inspector of Police, Alappuzha South Police Station. The offences allegedly involved in the case are those punishable under Section 120B and 395 of the Indian Penal Code (for short I.P.C.). The final report was submitted before the Judicial First Class Magistrate Court, Alappuzha and in view of the involvement of offences triable by the Court of Session, the Magistrate has committed the case vide proceedings initiated as C.P No.65/2013 in the matter. It is at that stage, the petitioner approached this Court seeking to quash the entire proceedings initiated pursuant to registration of Crime No.284/2008 of Alappuzha South Police Station. 2. The facts in brief in the Cri.M.C are to the following effect:- The petitioners are accused Nos.7 and 8 in Crime No.284/2008 of Alappuzha South Police Station. Apart from the petitioners, six other accused were also involved in the crime. Petitioners are employees of Bajaj Auto Finance Ltd., who had advanced money to the de facto complainant for purchasing a motor vehicle. As per the terms of the agreement of hire purchase, the company is entitled to seize the vehicle in case of default in repayment of instalments by the de facto complainant. Utilizing the loan amount the de facto complainant had purchased a motorcycle bearing Registration No.KL-04-V-5734. The repayment of the loan was defaulted by the de facto complainant after effecting some payments. It is in the said circumstances that the Company, who had advanced the loan, sent accused Nos.1 to 6 to the petitioner to get the vehicle repossessed. Accused Nos.1 to 6 went to the spot and following some altercations the vehicle was taken in their custody and handed over to the Company. On the basis of a complaint lodged by the de facto complainant, the crime in question was registered alleging commission of the offences punishable under Section 120B and 395 I.P.C. Investigation was proceeded with and on conclusion thereof, a final report was laid chargesheeting all the eight accused for the offences for which the crime was registered. On the basis of a complaint lodged by the de facto complainant, the crime in question was registered alleging commission of the offences punishable under Section 120B and 395 I.P.C. Investigation was proceeded with and on conclusion thereof, a final report was laid chargesheeting all the eight accused for the offences for which the crime was registered. It is at that juncture that the petitioners, who are accused Nos. 7 and 8, have approached this court seeking to quash the proceedings, 3. Sri. K. Ramakumar, the learned counsel appearing for the petitioners and Sri. N. Suresh, the learned Public Prosecutor appearing for the State were heard on their rival contentions. 4. The proceedings initiated pursuant to the registration of Crime No.284/2008 of Alappuzha South Police Station are sought to be quashed in this Cri.M.C. In the said circumstances, it is pertinent to have a look at the allegations to see whether the offences punishable under Sections 120B and 395 I.P.C. are attracted or not. Section 120B reads:- "120B. Punishment of criminal conspiracy.- (1) Whoever is a party to a criminal conspiracy to commit an offence punishable with death, imprisonment for life or rigorous imprisonment for a term of two years or upwards, shall, where no express provision is made in this Code for the punishment of such a conspiracy, be punished in the same manner as if he had abetted such offence. (2) Whoever is a party to a criminal conspiracy other than a criminal conspiracy to commit an offence punishable as aforesaid shall be punished with imprisonment of either description for a term not exceeding six months, or with fine or with both." 5. Therefore, Section 120B is the penal provision providing punishment for the offence of criminal conspiracy. Criminal conspiracy is defined under Section 120A I.P.C. It provides: "120A. Definition of criminal conspiracy.- When two or more persons agree to do, or cause to be done,- (1) an illegal act, or (2) an act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy: Provided that no agreement except an agreement to commit an offence shall amount to a criminal conspiracy unless some act besides the agreement is done by one or more parties to such agreement in pursuance thereof. Explanation-It is immaterial whether the illegal act is the ultimate object of such agreement, or is merely incidental to that object." 6. Explanation-It is immaterial whether the illegal act is the ultimate object of such agreement, or is merely incidental to that object." 6. The contemplation of Section 120A was that two or more persons must agree to commit or cause to be committed either an illegal act or an act which is not illegal by illegal means. Therefore, in order to be an offence of criminal conspiracy under Section 120A there must be involvement of two or more persons and those persons must agree to do or cause to be done either an illegal act or a legal act through illegal means. In order for the offence to be attracted, there must be specific allegation attracting the ingredients of the offence in the prosecution launched against the petitioners. In the said circumstances, it is appropriate to have a look at Annexure A Final report by which the petitioners along with six other accused have been chargesheeted for the offences under Section 120B and 395 I.P.C. The relevant part of Annexure A charge sheet containing accusation against the petitioners is extracted hereunder: VERNACULAR MATTER 7. The specific allegation against the petitioners, who are accused Nos. 7 and 8 was that they have conspired with accused Nos. 1 to 6 for robbing a vehicle bearing Registration No. KL-04-V-5734 from the custody of the de facto complainant. 8. Since the word robbery is used in the accusation, it is relevant to have a look at the definition of robbery as contained in I.P.C. 9. Section 390 I.P.C. defines robbery in the following terms. "390. Robbery.- In all robbery there is either theft or extortion. When theft is robbery.- Theft is "robbery" if, in order to the committing of the theft, or in committing the theft, or in carrying away or attempting to carry away property obtained by the theft, the offender, for that end, voluntarily causes or attempts to cause to any person death or hurt or wrongful restraint, or fear of instant death or of instant hurt, or of instant wrongful restraint. When extortion is robbery.- Extortion is "robbery" if the offender, at the time of committing the extortion, is in the presence of the person put in fear, and commits the extortion by putting that person in fear of instant death, of instant hurt, or of instant wrongful restraint to that person or to some other person, and, by so putting in fear, induces the person so put in fear then and there to deliver up the thing extorted. Explanation.- The offender is said to be present if he is sufficiently near to put the other person in fear of instant death, of instant hurt, or of instant wrongful restraint." 10. Therefore, it is provided under Section 390 I.P.C. that in all robbery there is either theft or extortion. In this case, in view of the allegations incorporated in Annexure A final report, it is apposite to have a look at the definition of theft rather than extortion. Section 378 I.P.C. defines theft. It provides: "378. Theft.- Whoever, intending to take dishonestly any movable property out of the possession of any person without that persons consent, moves that property in order to such taking, is said to commit theft." 11. Therefore, in order to attract the offence of theft under Section 378 I.P.C., an intention to take a movable property dishonestly out of the possession of any person without that persons consent is necessary. In view of the aforesaid discussion, it is apposite to have a look at the allegations, to see whether those are sufficient to attract the offence of theft as defined under Section 378 I.P.C. 12. As already discussed herein above, for an offence of conspiracy to sustain, there must be an agreement between two or more persons to do an illegal act or a legal act by illegal means. The illegal act may or may not be done in pursuance of the agreement, but the very agreement is an offence and is punishable. Therefore, entering into an agreement by two or more persons to do an illegal act or legal act by illegal means is the very quintessence of the offence of conspiracy. 13. The illegal act may or may not be done in pursuance of the agreement, but the very agreement is an offence and is punishable. Therefore, entering into an agreement by two or more persons to do an illegal act or legal act by illegal means is the very quintessence of the offence of conspiracy. 13. In the case in question, if at all any agreement is presumed to have been entered, it was only for getting repossession of the vehicle which in view of the retention of ownership by the financier, cannot be termed as an illegal act or legal act by illegal means. There is no allegation in Annexure A, the relevant part of which is extracted herein above, that the petitioner conspired with the co-accused to get repossession either through illegal act or through illegal means to achieve a legal object. The Apex Court has held in Viiayan @ Rajan v. State of Kerala and K.S. Sadanandan v. State of Kerala ( AIR 1999 SC 1086 ) to the following effect:- "11.......................To bring home the charge of conspiracy within the ambit of Section 120-B of the Indian Penal Code it is necessary to establish that there was an agreement between the parties for doing an unlawful act. It is no doubt true that it is difficult to establish conspiracy by direct evidence and therefore, from established facts inference could be drawn but there must be some material from which it would be reasonable to establish a connection between the alleged conspiracy and the act done pursuant to the said conspiracy." 14. Therefore, in order that an offence of conspiracy to sustain there should be allegation showing connection between the conspiracy and the act done pursuant to that. The accusation in the final report as stated supra do not contain an allegation that the vehicle was taken dishonestly out of the possession of the de facto complainant without that persons consent. Admittedly of the petitioners and the de facto complainant, the vehicle was purchased utilising the loan amount advanced by a hire purchasing company. 15. At this juncture, it is appropriate to have a look at the dictionary meaning of the term hire purchase. Admittedly of the petitioners and the de facto complainant, the vehicle was purchased utilising the loan amount advanced by a hire purchasing company. 15. At this juncture, it is appropriate to have a look at the dictionary meaning of the term hire purchase. In the Cambridge Advanced Learners Dictionary, it means, "a method of paying for something in which the buyer pays part of the cost immediately and then makes small regular payments until the debt is completely paid." In the Merriam Websters Dictionary, it means, "purchase on the instalment plan". In the Oxford Dictionary, it means, "A system by which one pays for a thing in regular instalments while having the use of it." Therefore, in view of the meanings referred supra, hire purchase is a system by which money was advanced for purchase of a thing on the ground that repayment has to be effected in instalments. The sources of the law in India on hire purchase is either judge made law or the terms in the agreement. 16. Judicial decisions are mostly based on the English case law which are abundant. The earliest decision of Hire Purchase Law is the one delivered by the House of Lords in Helby v. Mathews (1895 AC 471). Their Lordships laid down the Law of Hire Purchase as a contract of bailment. 17. The word bailment has been defined in Section 148 of the Indian Contract Act as "the delivery of goods by one person to another for some purpose upon a contract that they shall when the purpose is accomplished, be returned or otherwise be disposed of according to the direction of the person delivering them." 18. Therefore, a hire purchase transaction requires, apart from the subject matter, two personalities viz., the owner and the hirer. A hire purchase agreement consists in itself an agreement of bailment plus an option to purchase. Or in other words, hire purchase agreement is an agreement under which goods are passed on from the owner thereof to another with a stipulation that if the other person does not choose to purchase the goods the same shall be returned to the owner in as good condition as it was originally delivered. The person who thus lets the goods is the owner and the person in whose favour it is let is the hirer. The person who thus lets the goods is the owner and the person in whose favour it is let is the hirer. Until the hirer chooses to purchase the goods and so long as he is in possession of the goods he is liable to pay hire charges to the owner by periodical payments or otherwise. At the time the hirer chooses to exercise his option to purchase, he would have to pay some nominal sum after having paid the entire hire charges as stipulated in the agreement. Thus, the hirer at the first instance is liable to pay hire and on eventually exercising the option, he purchases. During the continuance of the agreement, until exercising the option to buy, the relationship between the owner and the hirer is that of the bailer and bailee and the relationship is governed also by the principles of law of bailment during the continuance of the agreement in order to safeguard his own interest, the owner retains the ownership in himself till the completion of the payments. 19. It is also not in dispute that as per the terms of the hire purchase agreement, the de facto complainant has agreed to pay the respective instalments towards repayment of the loan. It is not in dispute that the agreement also incorporates within it a term favouring the company, who had advanced the loan to retain a lien in respect of the vehicle and to take repossession of the vehicle when any of the instalments have been defaulted by the de facto complainant. It is also an admitted fact that the de facto complainant has defaulted certain instalments towards repayment of loan. It is not in dispute that at the relevant time when payments have been defaulted that the petitioners who are accused Nos.7 and 8 had deputed accused Nos.1 to 6 to repossess the vehicle. Therefore, till the entire loan amount is repaid, the company, will be the owner and petitioners who are accused Nos.7 and 8 being its authorised officers have got every right and authority to get the vehicle repossessed. Being the owner of the vehicle neither the Company nor its officers can be said to have acted with dishonest intention in the matter of taking back possession of the vehicle from the custody of the de facto complainant. Being the owner of the vehicle neither the Company nor its officers can be said to have acted with dishonest intention in the matter of taking back possession of the vehicle from the custody of the de facto complainant. Being the owner of the vehicle the Company has every authority as per the hire purchase agreement to take back possession of the vehicle from the de facto complainant based on his default in remitting the instalment dues towards repayment of the loan. Therefore, repossession of the vehicle by the financier cannot be given the colour of illegality. In the case on hand, we are astonished to see that materials are lacking even for inferring a conspiracy among the accused person to repossess the vehicle through illegal act of voluntarily causing hurt. Therefore, to any stretch of imagination, the ingredients of the offence of theft are not attracted from the allegations set forth in the final report. 20. In the case in question, evidently, repayments of instalment loan dues have been defaulted by the hirer and in the said circumstances, the financier who retains the ownership of the vehicle with him, and departs only the possession to the hirer, would be entitled to repossess the same. Or in other words, the hirer is bound to surrender the possession of the vehicle to the financier, being the owner for the time being. It was in a circumstance when neither the repayments were effected promptly, nor possession of the same has been surrendered to the financier that, the latter took measures to get the same repossessed. Being the owner of the vehicle, the financier cannot be termed as a thief while exercising the option to repossess the vehicle, as the element of dishonest intention is totally lacking. It is in exercise of the right conferred on him by the terms of the hire purchase agreement that he had sent his agents and obtained repossession of the vehicle. To any stretch of imagination, the petitioners can be said to have committed the offences under Section 120B or 395 of I.P.C., as alleged. 21. It is in exercise of the right conferred on him by the terms of the hire purchase agreement that he had sent his agents and obtained repossession of the vehicle. To any stretch of imagination, the petitioners can be said to have committed the offences under Section 120B or 395 of I.P.C., as alleged. 21. The Apex Court had occasion to deal with situations of similar nature in Sardar Thrilok Singh v. Sathya Deo Thripadi (1979) 4 SCC 396 ; AIR 1979 SC 850 wherein a truck had been taken possession of by the financier in terms of a hire purchase agreement, as there was a default in making the payment of instalments. A criminal case had been registered against the financier under Section 395, 468, 465, 471 and 120B read with Section 34 I.P.C. The High Court when approached to quash the proceedings in exercise of the power under Section 482 Cr.P.C, did not quash the same on the ground that the financier had committed the offences. When the Apex Court was approached, reversing the said judgment/the court held that proceedings initiated were clearly an abuse of process of the court. The court further held that the dispute involved was purely of civil nature, even if the allegations made by the complainant were substantially correct. It observed, under the hire purchase agreement, the financier has made the payment of huge money and he was in fact the owner of the vehicle. The terms and conditions incorporated in the agreement gave rise, in case of dispute, only to civil rights and in such a case, the civil court must decide as to what was the meaning of those terms and conditions. 22. In K.A. Mathai v. Kora Bibbikutty (1996) 7 SCC 212 , the Apex Court held that in case of default in making the payment of instalments, the financier has a right to resume possession even if the hire purchase agreement does not contain a clause of resumption of possession for the reason that such a condition is to be read in the agreement. In such an eventuality, it cannot be held that the financier has committed an offence of theft and that too with the requisite mens rea and dishonest intention. In such an eventuality, it cannot be held that the financier has committed an offence of theft and that too with the requisite mens rea and dishonest intention. The assertion of rights and obligations accruing to the parties under the hire purchase agreement wipe out any dishonest pretense in that regard from which it cannot be inferred that the financier has resumed the possession of the vehicle with a guilty intention. 23. In this context, it is relevant to extract the dictum of the Apex Court incorporated in paragraph 13 of the decision in Chiranjit Singh Chadha & Ors. v. Sudheer Mehra AIR 2001 SC 3721 , which reads:- "13.........the owner repossessing the vehicle delivered to the hirer under the hire purchase agreement will not amount to theft as the vital element of 'dishonest intention is lacking. The element of dishonest intention which is an essential element to constitute the offence of theft cannot be attributed to a person exercising his right under an agreement entered into between the parties as he may not have an intention of causing wrongful gain or to cause wrongful loss to the hirer." "17. The hire-purchase agreement in law is an executory contract of sale and confers no right in rem on hirer until the conditions for transfer of the property to him have been fulfilled. Therefore, the re-possession of goods as per the terms of the agreement may not amount to any criminal offence. The agreement (Annexure P-I) specifically gave authority to the appellants to repossess the vehicle and their agents have been given the right to enter any property or building wherein the motor vehicle was likely to be kept. Under the hire purchase agreement, the appellants have continued to be the owners of the vehicle and even if the entire allegations against them are taken as true, no offence was made out against them. " 24. The learned counsel for the petitioner has also drawn my attention to the dictum in Anup Sarmah v. Bhola Nath Sharma & Ors. (2013) 1 SCC 400 . " 24. The learned counsel for the petitioner has also drawn my attention to the dictum in Anup Sarmah v. Bhola Nath Sharma & Ors. (2013) 1 SCC 400 . The Apex Court in the said case had dealt with a circumstance wherein recovery of possession of the vehicle was effected by the financier/owner as per the terms of the hire purchase agreement and held as follows:- "In an agreement of hire purchase, the purchaser remains merely a trustee/bailee on behalf of the financier/financial institution and ownership remains with the latter. Thus, in case the vehicle is seized by the financier, no criminal action can be taken against him as he is repossessing the goods owned by him." 25. The aforesaid dictum was laid down by the Apex Court relying upon the dictum in Sardar Thrilok Singh v. Sathya Deo Thpathi (1979) 4 SCC 396 : AIR 1979 SC 850 , wherein the petitioner had appeared before the said court with an allegation that the respondent financiers had forcibly taken away vehicle financed by them and illegally deprived the petitioner from its lawful possession and thus committed a crime. In the said case, complaint filed by the petitioner was entertained by the Magistrate directing interim custody of vehicle to be given to him. The contention of the respondent in the case was that under the hire purchase agreement financier remains owner of the vehicle till entire repayment is made and therefore, possession taken by the financier for nonpayment of instalments by the petitioner could not be held to be an offence. The High Court in which the challenge was raised rejected the case of the petitioner and held that they had forcibly taken custody of the vehicle purchased by the petitioner at hire purchase from them. Accordingly, the proceedings was quashed by the High Court against the respondents. But, when the matter was challenged before the Apex Court, it was held that in case of hire purchase, the purchaser remains merely a trustee/bailee and the financial institution retains the ownership. 26. The factual situation in the case on hand is similar to the one in the cases cited supra. Therefore, the ratio can squarely be applied in the case on hand. The petitioners herein are officers of Bajaj Auto Finance Ltd., who is the financier. 26. The factual situation in the case on hand is similar to the one in the cases cited supra. Therefore, the ratio can squarely be applied in the case on hand. The petitioners herein are officers of Bajaj Auto Finance Ltd., who is the financier. It is revealed from the allegations that they had acted as per the directions of the financier and in execution of the latters right to repossess the vehicle, in default of repayment by the hirer. In view of the aforesaid discussion, petitioners, who are accused Nos.7 and 8, cannot be held liable for the offences for which they were chargesheeted by Annexure A final report. Eventhough the F.I.R. and the further proceedings are required to be quashed in this petition, going by the materials furnished, it is seen that the investigation has been concluded and a final report was laid before the Judicial First Class Magistrate Court, Alappuzha and committal proceedings have been initiated by the learned Magistrate in the matter. In the said circumstances, it is appropriate that the final report and all further proceedings initiated pursuant to that, if quashed, would meet the ends of justice. 27. In the result this Cri. M.C. stands allowed and Annexure A final report charge sheeting the petitioners, who are accused Nos.7 and 8 for the offences under Section 120B and 395 I.P.C. and all further proceedings initiated pursuant to that stand quashed as against them.