2001 (8) TMI 1414 - SC - Indian Laws

Supreme Court ruling on vehicle possession, profits, and benami transaction appeal

VASANTHA VISWANATHAN & ORS. Versus V.K. ELAYALWAR & ORS

The Supreme Court upheld the High Court's finding on forcible possession of vehicles, ruling against the appellants. It held that the plaintiff was ... - Issues Involved:1. Legality of the High Court's finding on forcible possession.2. Entitlement to profits derived from plying of the vehicles.3. Question of benami transaction.4. Allegation of trafficking in permits.5. Privity of contract between the plaintiff and defendant nos. 4 to 7.6. Rejection of additional evidence by the High Court.7. Award of 12% interest per annum by the High Court.Issue-wise Detailed Analysis:1. Legality of the High Court's finding on forcible possession:The High Court's finding that the Ist defendant took forcible possession of the vehicles was contested by the appellants. However, the Supreme Court upheld the High Court's decision, stating that the High Court had considered all relevant materials and evidence before arriving at its conclusion. The Supreme Court found no reason to interfere with this finding.2. Entitlement to profits derived from plying of the vehicles:The Ist defendant and subsequent defendants argued that the plaintiff was only entitled to the price of the vehicles and not the profits earned from plying them. The Supreme Court rejected this argument, explaining that under Section 19 of the Sale of Goods Act, the property in the vehicles did not pass to the Ist defendant as the price was neither ascertained nor paid, and possession was forcibly taken. Consequently, the plaintiff was entitled to the profits earned by the defendants from plying the vehicles.3. Question of benami transaction:The appellants contended that granting relief to the plaintiff would amount to permitting a benami transaction, which is prohibited under Section 48A of the Motor Vehicles Act. The Supreme Court dismissed this argument, noting that the issue of benami was not raised in the written statements, nor was it framed as an issue or argued before the trial court or High Court. Therefore, it could not be raised for the first time before the Supreme Court.4. Allegation of trafficking in permits:The appellants claimed that the plaintiff was engaged in trafficking permits, which is prohibited by Rule 199 of the Tamil Nadu Motor Vehicles Rules and Section 23 of the Indian Contract Act. The Supreme Court found that this issue was not pleaded or proven with evidence in the trial court. It was raised for the first time before the High Court, which found the agreement valid. The Supreme Court held that the question of trafficking in permits is a mixed question of fact and law and could not be entertained without proper pleading and evidence.5. Privity of contract between the plaintiff and defendant nos. 4 to 7:The appellants argued that there was no privity of contract between the plaintiff and defendant nos. 4 to 7. The Supreme Court upheld the High Court's finding that these defendants were not bona fide purchasers and had notice of the agreement between the plaintiff and the Ist defendant. The Supreme Court referenced Section 58 of the Sale of Goods Act and Section 19(b) of the Specific Relief Act, which allow for specific performance of a contract against subsequent purchasers with notice. Therefore, the High Court was justified in passing a decree against defendant nos. 4 to 7.6. Rejection of additional evidence by the High Court:The appellants' request to admit additional evidence, specifically a joint application filed before the Regional Transport Authority, was rejected by the High Court. The Supreme Court found no infirmity in this decision, noting that the document was not put to the plaintiff during testimony and the copy produced was not a certified copy.7. Award of 12% interest per annum by the High Court:The Supreme Court found that there was no basis in the documents, Exhibits A-1 and A-2, for awarding interest. In the absence of any stipulation for interest and considering the facts and circumstances, the Supreme Court modified the High Court's judgment to exclude the award of 12% interest per annum.Conclusion:The appeals were dismissed with the modification that the plaintiff would not be entitled to any interest. There was no order as to costs.