1 2025:CGHC:57157-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR CRMP No. 3399 of 2024 1 - Sukhdev Rai S/o Subhash Rai Aged About 38 Years R/o P.V. 38 Indraphrasta, Kanker, C.G. 2 - Gautam Mandal S/o Shri Jeevan Mandal Aged About 35 Years R/o P.V. 38 Indraphrasta, Kanker, C.G. ... Petitioner(s) versus 1 - State Of Chhattisgarh Through The Station House O昀케cer, Police Station Keshkal, District Kondagaon, C.G. 2 - Smt. Sita Bai Yadav W/o Late Shiv Prasad Yadav Aged About 57 Years R/o Bajarpara, Surdonger, Keshkal, District Kondagaon, C.G. ... Respondent(s) (Cause title taken from CIS) For Petitioner(s) : Shri B.P. Sharma, Shri P.R. Patankar and Ms. Vartika Shrivastava, Advocates For Respondent/State : Shri Malay Jain, Panel lawyer. SHOAIB ANWAR Digitally signed by SHOAIB ANWAR Date: 2025.11.26 10:38:38 +0530 2 Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Bibhu Datta Guru, Judge Order on Board Per Ramesh Sinha , Chief Justice 25.11.2025 1. In compliance of the order dated 18.11.2025, the O昀케ce submitted its report on 19.11.2025 stating therein that though notice has been served upon respondent no. 2, but memo of appearance has not been 昀椀led by the said respondent. In view of the same, we proceed to hear the matter 昀椀nally, by treating ‘deemed service of notice’ upon respondent no. 2. 2. The present Cr.M.P. has been 昀椀led with the following prayer:- “It is, therefore, prayed that this Hon'ble Court may be pleased to exercise its inherent jurisdiction under Section 528 of B.N.S.S. and in exercise thereof, quash FIR No.6/2024 dated 09.1.2024 and charge sheet bearing No.13/2023 昀椀led by P.S. Keshkal under Section 294, 392, 34 of I.P.C. and criminal proceedings in criminal case no.23/24 pending before J.M.F.C. Kondagaon being violative of petitioners' fundamental & constitutional rights 3 granted under the Constitution of India and amounting to abuse of process of Court and law in the facts and circumstances of case. 3. The facts of the case are that the petitioners are employees of Mahindra & Mahindra Financial Services Ltd., petitioner No.1 working as a Collection Executive and petitioner No.2 as a Driver at its Kanker branch. The Company had 昀椀nanced an amount of Rs.4,95,000/- to the husband of the respondent No.2 namely; Shiv Prasad Yadav (now deceased) under a loan agreement dated 22.07.2021 for purchase of a Shivnath Tractor, repayable in ten half-yearly instalments, the 昀椀rst due on 11.08.2021. After disbursal of the loan and delivery of the tractor, the borrower defaulted in payment, for which a notice dated 14.09.2022 was issued. Upon the death of the borrower and continued defaults, the Company exercised its contractual right to repossess the vehicle through the petitioners. The FIR itself admits that the borrower had taken the tractor on 昀椀nance and had paid only three installments, and grievance is essentially that the petitioners, without serving notice on the complainant, came on 20.10.2023 stating that they were from the Company and repossessed the tractor. On this basis, 4 o昀昀ences under Sections 294, 392 and 34 IPC were registered; the petitioners were issued notice on 09.12.2023, arrested, and later released on bail by order dated 12.01.2024. 4. Learned counsel for the petitioners submits that even if the allegations made in the FIR and the charge-sheet are accepted in their entirety, no o昀昀ence whatsoever, much less the o昀昀ences under Sections 294, 392 and 34 IPC, is made out against the petitioners. It is urged that the dispute, on its face, is purely civil in nature arising out of a hire-purchase/loan-cum- hypothecation arrangement, wherein the ownership of the 昀椀nanced vehicle always remains with the 昀椀nancier, and the borrower continues merely as a trustee/bailee. Therefore, repossession of the vehicle upon default is an act squarely within the contractual domain and cannot constitute any criminal o昀昀ence. It is submitted that the law on this aspect stands settled by the Hon’ble Supreme Court as early as in Trilok Singh v. Satya Deo Tripathi, AIR 1979 SC 850, wherein the Apex Court held that repossession of a 昀椀nanced vehicle on account of default is essentially a civil dispute and initiation of criminal proceedings in such circumstances amounts to abuse of process of law. 5 5. Learned Counsel further places reliance on the subsequent consistent line of judgments including K.A. Mathai @ Babu v. Kora Bibbikutty, (1996) 7 SCC 212; Charanjit Singh Chadha v. Sudhir Mehra, AIR 2001 SC 3721; Anup Sarmah v. Bhola Nath Sharma, SLP No.8907/2009, decided on 30.10.2012; Surya Pal Singh v. Siddha Vinayak Motors, (2012) 12 SCC 355; and Rajkumar Sharma v. Shriram Finance Co. Ltd., CRMP No.128/2014, decided by the High Court of Chhattisgarh on 07.08.2014. These decisions uniformly hold that in a hire- purchase agreement, the 昀椀nancier retains ownership of the vehicle and is legally entitled to repossess it upon default, and initiation of criminal proceedings in such matters is unsustainable. It is argued that the FIR in the present case was lodged after an unexplained delay of 10 days, which itself indicates an afterthought. The allegations are bald, exaggerated and unsupported by any material. The statements of witnesses recorded during the investigation, including those of the complainant, Anoop Yadav, Ashish Yadav, Sonu Nishad and Raj Dugga, are mere stereotyped versions recorded only to falsely implicate the petitioners. 6 6. Learned State counsel opposes the petition and submits that the FIR and the material collected during investigation prima facie disclose the commission of o昀昀ences under Sections 294, 392 and 34 IPC. It is contended that the petitioners, without issuing any prior notice and without following due procedure, came to the complainant’s premises, used abusive language and forcibly took away the tractor, which attracts the ingredients of robbery. It is further submitted that the judgments relied upon by the petitioners regarding hire- purchase agreements do not apply where allegations of threat, force and abusive conduct are speci昀椀cally made. These are disputed questions of fact requiring evidence and cannot be examined in a petition under Section 528 of B.N.S.S. Therefore, the petitioners are not entitled to quashing at this stage. 7. We have heard learned counsel for the parties and perused the record with utmost circumspection. 8. It is undisputed that the husband of respondent No.2 namely; Shiv Prasad Yadav, during his life time, had obtained a loan from Mahindra & Mahindra Financial Services Ltd. for purchase of a tractor and that the petitioners are employees of the said 昀椀nance company. The borrower had defaulted in payment of 7 instalments and had also passed away. It is further not in dispute that on 20.10.2023 the petitioners went to the complainant’s premises and repossessed the tractor, and that thereafter an FIR was registered, investigation was completed, the petitioners were arrested and subsequently released on bail, and a charge-sheet has been 昀椀led. 9. The Hon’ble Supreme Court in Trilok Singh v. Satya Deo Tripathi, AIR 1979 SC 850, in paragraph 5 has held as under: “5. We are clearly of the view that it was not a case where any processes ought to have been directed to be issued against any of the accused. On the well- settled principles of law it was a very suitable case where the criminal proceeding ought to have been quashed by the High Court in exercise of its inherent power. The dispute raised by the respondent was purely of a civil nature even assuming the facts stated by him to be substantially correct. Money must have been advanced to him and his partner by the 昀椀nancier on the basis of some terms settled between the parties. Even assuming that the agreement entered on 29th March, 1973 was not duly 昀椀lled up 8 and the signature of the complainant was obtained on a blank form, it is to be noticed that the amount of the two monthly instalments admittedly paid by him was to the tune of Rs. 3,566/- exactly @ Rs. 1,783/- per month. The complaint does not say as to when these two monthly instalments were paid. In the First Information Report which he had lodged he had not stated that the third monthly instalment was payable on July 31, 1973. Rather, from the statement in the First Information Report it appears that the instalment had already become due on 28.7.1973 when the complainant went out of Kanpur according to his case. The question as to what were the terms of the settlement and whether they were duly incorporated in the printed agreement or not were all questions which could be properly and adequately decided in a civil court. Obtaining signature of a person on blank sheet of paper by itself is not an o昀昀ence of forgery or the like. It becomes an o昀昀ence when the paper is fabricated into a document of the kind which attracts the relevant provisions of the 9 Penal Code making it an o昀昀ence or when such a document is used as a genuine document. Even assuming that the appellants either by themselves or in the company of some others went and seized the truck on 30.7.1973 from the house of the respondent they could and did claim to have done so in exercise of their bona 昀椀de right of seizing the truck on the respondent’s failure to pay the third monthly instalment in time. It was therefore, a bona 昀椀de civil dispute which led to the seizure of the truck. On the face of the complaint petition itself the highly exaggerated version given by the respondent that the appellants went to his house with a mob armed with deadly weapons and committed the o昀昀ence of dacoity in taking away the truck was so very unnatural and untrustworthy that it could not take the matter out of the realm of civil dispute. Nobody on the side of the respondent was hurt. Even a scratch was not given to anybody.” 10 10. The Hon’ble Supreme Court, in the matter of Charanjit Singh Chadha & Others v. Sudhir Mehra, (2001) 7 SCC 417, has categorically held in paragraphs 5 and 11:- “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 hire-purchase scheme gained popularity and in size, the dealers who were not endowed with liberal amount of working capital found it di昀케cult to extend the scheme to many customers. Then the 昀椀nanciers came into picture. The 昀椀nance company would buy the goods from the dealer and let them to the customer under hire purchase agreement. The dealer would deliver the goods to the customer who would then drop out of the transaction leaving the 昀椀nance company to collect instalments directly from the customer. Under hire purchase agreement, the 11 hirer is simply paying for the use of the goods and for the option to purchase them. The 昀椀nance charge, representing the di昀昀erence between the cash price and the hire purchase price, is not interest but represents a sum which the hirer has to pay for the privilege of being allowed to discharge the purchase price of goods by instalments. xxx xxx xxx 11. The whole case put forward by the respondent- complainant is to be appreciated in view of the stringent terms incorporated in the agreement. If the hirer himself has committed default by not paying the instalments and under the agreement the appellants have taken re-possession of the vehicle, the respondent cannot have any grievance. The respondent cannot be permitted to say that the owner of the vehicle has committed theft of the vehicle or criminal breach of trust or cheating or criminal conspiracy as alleged in the complaint. When the agreement speci昀椀cally says that the owner has got a right to re-possess the vehicle, there 12 cannot be any basis for alleging that the appellants have committed criminal breach of trust or cheating.” 11.The Hon’ble Supreme Court in the matter of Surya Pal Singh v. Siddha Vinayak Motors & Another, (2012) 12 SCC 355, has categorically held that: “2.Under the Hire Purchase Agreement, it is the 昀椀nancier who is the owner of the vehicle and the person who takes the loan retains the vehicle only as a bailee/trustee, therefore, taking possession of the vehicle on the ground of non-payment of instalment has always been upheld to be a legal right of the 昀椀nancier…...” 12.The Supreme Court has, time and again, held that repossession of the 昀椀nanced vehicle upon default is purely a civil consequence of the contractual terms of a hire-purchase agreement, and such repossession does not amount to theft, extortion, robbery, criminal breach of trust or cheating, as ownership remains with the 昀椀nancier. In Trilok Singh (supra), the Supreme Court emphatically held that where repossession is undertaken due to non-payment of installments under a 13 hire-purchase agreement, the dispute remains purely civil in nature. The said legal position was reiterated in subsequent decisions where the Supreme Court held in clear terms under the Hire Purchase Agreement, it is the 昀椀nancier who is the owner of the vehicle and the person who takes the loan retains the vehicle only as a bailee/trustee; therefore, taking possession of the vehicle on the ground of non-payment of instalment has always been upheld to be a legal right of the 昀椀nancier. 13.Applying the above authoritative pronouncements, this Court is of the considered view that, even if the allegations in the FIR and charge-sheet are taken at their face value, no o昀昀ence under Sections 294, 392 or 34 IPC is made out against the petitioners. The act of repossessing the tractor is squarely protected under the terms of the hire-purchase agreement and recognised legal rights of the 昀椀nancier. The allegations in the FIR appear to be an afterthought, having been lodged with unexplained delay, and allowing such proceedings to continue would amount to abuse of process of law, as criminal law cannot be permitted to be used as an instrument to settle 14 private civil disputes or exert pressure on the 昀椀nancier or its employees. 14. In view of the settled legal position laid down by the Supreme Court in the aforesaid decisions, and considering that the allegations disclose at best a civil dispute arising out of non- payment of instalments, this Court is satis昀椀ed that continuance of the criminal proceedings against the petitioners would amount to a manifest abuse of the process of Court. 15. From the attending facts of the case when it is found that the lender or 昀椀nancer took repossession of the vehicle, pursuant to the agreement executed by and between the parties, it cannot be said that the lender committed o昀昀ence within the meaning of Penal Code with the requisite mens rea and dishonest intention. At best it could be a civil dispute which has been imbibed with the colour of criminality. 16.Accordingly, the petition under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, is allowed. The FIR No.6/2024 dated 09.1.2024 and charge sheet bearing No.13/2023 昀椀led by P.S. Keshkal under Section 294, 392, 34 of I.P.C. and criminal 15 proceedings in criminal case no.23/24 pending before J.M.F.C are hereby quashed. Sd/- Sd/- (Bibhu Datta Guru) (Ramesh Sinha) Judge Chief Justice Shoaib