Peer Mohammed vs. The Superintendent Of Police
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The petitioner, Peer Mohammed, filed a writ petition seeking a direction to the police to take action against Cholamandalam Investment and Finance Company Ltd. (the fourth respondent) for allegedly taking illegal and forcible possession of his JCB vehicle (registration No. TN 60 BW 5761). The petitioner had availed a loan for the vehicle and claimed to have defaulted on only the last two installments, offering to settle them. However, the finance company proceeded with an online auction. Arun Prakash (the sixth respondent), who purchased the JCB in the auction for Rs. 25 Lakhs, was impleaded, asserting his lawful ownership and possession. The finance company contended that the petitioner defaulted on three installments, and despite issuing notice (which was allegedly returned due to a wrong address provided by the petitioner), conducted the auction.
Held
The Court found that the fourth respondent finance company acted hastily and did not take necessary steps to provide proper notice to the petitioner. Even assuming implied service of notice, which was returned as 'addressee left without instructions,' the company failed to provide a reasonable 'breathing time' of at least 10 days before conducting the online auction within a period of 10 days. The Court noted that the sixth respondent, the auction purchaser, had paid the sale consideration, GST, and yard rent. The Court directed the fourth respondent to forthwith return the entire sale consideration of Rs. 25,30,000/-, along with GST of Rs. 29,854/- and yard rent of Rs. 6,500/- to the sixth respondent. Additionally, the fourth respondent was ordered to pay Rs. 1,000/- per day as compensation from the date of the auction sale until the date of the order (totaling Rs. 28,000/- for 28 days) to the sixth respondent. The Court also granted liberty to the petitioner to approach the appropriate civil forum for remedy and directed the second respondent to maintain the status quo until the petitioner takes necessary steps. The issue of the petitioner's claim for repossession of the vehicle was implicitly addressed by directing the return of funds to the auction purchaser and advising the petitioner to pursue civil remedies.
Key Issues
1. Whether the fourth respondent finance company acted illegally and in breach of contract by conducting an online auction of the petitioner's JCB vehicle without providing adequate notice and reasonable time for the petitioner to respond, thereby violating principles of natural justice? 2. Whether the sixth respondent, as a bona fide auction purchaser, is entitled to retain possession of the JCB vehicle, and what is the recourse for the parties involved given the alleged hasty auction process? Petitioner's arguments: The petitioner argued that the finance company acted hastily in conducting the auction on June 29, 2026, shortly after issuing a notice on June 17, 2026, which was returned on June 20, 2026. The petitioner contended that at least 15 days' notice should have been provided, and the auction was conducted without giving him sufficient time to respond or take necessary action. Revenue/State's arguments: The learned Government Advocate for the second respondent stated that the RC book of the JCB had been blacklisted as per court directions, preventing further transactions. The fourth respondent finance company argued that the petitioner defaulted on three monthly dues, and despite issuing notice, the petitioner provided a wrong address. They also claimed to have issued an SMS notification. The sixth respondent argued that he is a bona fide purchaser and should not be dispossessed.
Sections Cited
None explicitly discussed or named in relation to GST provisions, though GST amount was mentioned in the context of the auction sale.
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Before: and
Seeking to direct the third respondent to take action as against the 4th Respondent for the illegal forcible possession of petitioner's JCB vehicle registration No.TN 60 BW 5761 and repossess the same to the petitioner within the time stipulated by this Court, this writ petition is filed.
The learned counsel for the petitioner submitted that the petitioner had availed vehicle loan with Cholamandalam Investment and Finance Company Ltd, who is the 4th respondent herein for the purchase of the said JCB bearing registration No.TN 60 BW 5761 and had been paying the monthly dues without default except for the last two months. However, without notice, the fourth respondent finance company is trying to take the possession of the JCB illegally and forcibly, despite the petitioner is promptly willing to settle the pending two instalments dues. While so, an impleading petition has been filed in WMP(MD)No.948 of 2028 by one Arun Prakash stating that he had already purchased the said JCb in an online auction which was conducted by the 4th respondent finance company by making a payment of Rs.25 Lakhs and he was also 3/10 https://www.mhc.tn.gov.in/judis handed over with the possession of the said JCB by the 4th respondent company and hence his possession with respect to the said JCB is lawful, legal and he is the legal owner of the said JCB.
The learned counsel appearing for the 4th respondent committee submitted that the claim of the petitioner is completely incorrect and he had committed default of three monthly dues, pursuant to which proper action was taken to conduct an online auction with respect to the said movable property. He also pointed out that the petitioner had entered into a hypothecation deed with the 4th respondent company where he had volunteered to agree that even at default of a single month's due, the 4th respondent company is indicted to conduct online auction with respect to the same and only pursuant to his default for three dues, the 4th respondent company had taken proper steps by issuing notice which was tactfully reverted back by giving a wrong address to the 4th respondent company. Thereafter, the 4th respondent company had also indicated the same through SMS in the number given by the petitioner at the time of availing loan. Hence, pursuant to the failure of the petitioner to turn up, the auction was conducted. 4/10 https://www.mhc.tn.gov.in/judis
The learned counsel for the petitioner submitted that, even assuming the conventions of the 4th respondent company is true, that they had issued a notice seeking repayment, the same is claimed to have been issued only on 17.06.2026 which is claimed to have returned as addressee left without instructions on 20.06.2026. At least the 4th respondent company ought to have given at least a period of 15 days time for the petitioner to respond to the said notice or to take necessary action at his end. Having not done so in a hurried manner, he had conducted online auction on 29.06.2026. Without giving the petitioner a breathing time, which is per se illegal, and sought the indulgence of this Court.
The learned counsel for the sixth respondent / auction purchaser submitted that he should not be dispossessed with the property since he had purchased the same in a proper manner in an online auction and had completely remitted the entire sale consideration to the 4th respondent company and it is for the 4th respondent company to deal with the issue and the auction purchaser should not be penalised since he is a bona fide purchaser. 5/10 https://www.mhc.tn.gov.in/judis
The learned Government Advocate appearing for the second respondent submitted that already on the directions of this Court, the RC book and the transfer of the name of the owner in the RC book pertaining to JCB bearing registration No.TN 60 BW 5761 has already been blacklisted and no further transaction would be permitted until further orders from this Court.
Heard either sides and carefully perused the materials available on record.
From the nature of the issue which has popped up before this Court, it is clear that the matter in hand is a clear breach of contract between two parties. When the matter came before this Court, already the possession of the JCB in question has been taken by the 4th respondent company from the petitioner and it is also claimed by the sixth respondent that he had already purchased the same by online in an online auction and the possession of the JCB has been handed over to him, but the transfer of ownership is still pending. 6/10 https://www.mhc.tn.gov.in/judis
In view of the same, liberty is given to the petitioner to approach the appropriate civil forum, for appropriate remedy. The second respondent is directed to maintain the status quo till the petitioner is taking necessary steps to before the appropriate forum. It is made clear that the 4th respondent company had acted hastily and had not taken necessary steps to give proper notice to the petitioner and despite the earlier notice stated 16.06.2026 has been returned as addressee left without instructions. Though the counsel for the 4th respondent claimed that an SMS was issued to the petitioner, the same is not properly reflected in the materials placed before me. Even assuming the implied service of notice, since the notice has been returned as addressee left without instruction, having not given a breathing time of at least 10 days, the online auction has been conducted in a hurried manner within a period of 10 days.
In view of the same, it is for the parties to work out the remedy before the appropriate civil forum. It is also made clear that the sixth respondent is entitled for proper compensation from the fourth 7/10 https://www.mhc.tn.gov.in/judis respondent company for having sold the property in a hurried manner without clearing the ownership to him.
The learned counsel for the sixth respondent submitted that the sixth respondent is the real victim in the instant case and the fourth respondent company had also collected an amount of additional amount of Rs.29,854/- for G.S.T., and Rs.6,500/- for yard rent, apart from the sale consideration of Rs.25,30,000/-.
Since it is brought to the notice of this Court that the sixth respondent had purchased the same by auction purchase 29.06.2026 and the possession was handed over only on 30.06.2026 for having parked the JCB in the yard of the 4th respondent company for two days, they have collected an amount of rupees 6,500/- from the sixth respondent.
Since all the submissions made by the petitioner as well as the impleading petitioner made it clear that the 4th respondent are doing a reckless business. Therefore, the fourth respondent is directed to forthwith return the entire sale consideration of Rs.25,30,000/- along 8/10 https://www.mhc.tn.gov.in/judis with GST of Rs.29,854/- and yard rent of Rs.6,500/- to the sixth respondent. In addition to that, the 4th respondent is also directed to pay a sum of Rs.1,000/- (One Thousand only) per day, from the date of auction sale till the date of this order, as compensation ie., Rs. 28,000/- (Rupees Twenty Eight Thousand) for 28 days.
With the above direction, this writ petition is disposed of. Consequently, connected miscellaneous petition stands closed. 28.07.2026 NCC : yes / no Index : yes / no pnn 9/10 https://www.mhc.tn.gov.in/judis L. VICTORIA GOWRI, J. pnn To 1. The Superintendent of Police, Theni District, Theni.
The Regional Transport Officer, Uthamapalayam, Theni District.
The Inspector of Police, Cumbam North Police Station, Theni District.
The Regional Manager, Cholamandalam Investment and Finance Company Ltd, Madurai.
The Additional Public Prosecutor, Madurai Bench of Madras High Court, Madurai. ORDER IN and WPMP CRL.(MD). No.847 of 2026 Date : 28/07/2026 10/10 https://www.mhc.tn.gov.in/judis
Reproduced from the public record of the Madras High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.