Madras High Court, exercising powers under Section 9 of the Arbitration and Conciliation Act, 1996, appointed an Advocate Commissioner to repossess a defaulted vehicle, granting authority for police assistance and setting conditions for its return upon repayment of dues.

Case title

Cholamandalam Investment And Finance Co Ltd v. Anil Dhansing Dhainje & Ors.

Neutral Citation: Arb Appln  No. 630 of 2025

Bench : Hon’ble Mr. Justice N. Anand Venkatesh

Issue of Law 

Whether the court should appoint an Advocate Commissioner under Section 9 of the Arbitration and Conciliation Act, 1996, to repossess a vehicle from the respondent due to loan repayment default, with authority for police assistance if necessary.

Brief Facts

The applicant, a non-banking financial institution, lent money to the respondent under a loan agreement dated 25.03.2023. The respondent defaulted in repayment, with arrears totalling Rs. 2,97,856/- as per the account statement dated 05.04.2025. Arbitration proceedings had been initiated with the appointment of an arbitrator as per Section 21 of the Arbitration and Conciliation Act. The loan agreement empowered the applicant to repossess the vehicle in case of default in repayment. The applicant faced difficulties repossessing the vehicle on its own and thus sought court intervention for the appointment of an Advocate Commissioner to repossess the vehicle. The respondent had defaulted on 16 installments as on the application date. The respondent subsequently died, prompting the applicant to bring the legal heir on record

Judgment

The court appointed Ms. S. Janani, Advocate, as Advocate Commissioner to repossess the vehicle described in the schedule, from the respondent's premises or wherever found. The Advocate Commissioner was authorized to break open premises and avail police assistance if required to repossess the vehicle. After repossession, interim custody of the vehicle was to be handed over to the applicant, who shall keep it safely. The Advocate Commissioner must inform the (legal heir of the) respondent of the arrears amount (Rs. 2,97,856/-) immediately after repossession, via Registered Post with Acknowledgment Due (RPAD) or by hand delivery. The respondent or legal heir is entitled to get the vehicle returned upon payment of Rs. 2,97,856/- within one week of repossession, alongside an undertaking to pay future installments timely. The applicant shall redeliver the vehicle with proper acknowledgment and commissioner assistance upon payment. The applicant must initiate arbitration within 90 days; failure to do so automatically vacates the order, requiring vehicle return to the respondent/unconditionally by the applicant. The Advocate Commissioner is entitled to an initial remuneration of Rs. 25,000/-. The applicant will bear all other expenses (boarding, lodging, travel). The Advocate Commissioner confirmed vehicle repossession and informed the court of the respondent’s death; consequently, the legal heir was impleaded as the second respondent. The court allowed private notice to be issued to the legal heir and later noted no representation from the legal heir at the hearing. Given the vehicle repossession and impleading of the legal heir, the application was disposed of with no further orders and no costs awarded.

Subsequent Development

The Advocate Commissioner physically repossessed the vehicle from the third party as per the 23.04.2025 order and filed a report of the same. The respondent's death was officially notified, and the legal heir was brought on record (Application A No.4596 of 2025). The applicant was directed to pay an additional Rs. 25,000/- remuneration to the Advocate Commissioner within two weeks from the date of the copied order. Private notice to the legal heir was provided, with affidavit of service filed before the court. No further representation was received from the legal heir or counsel at the hearing on 07.10.2025. The matter was disposed of post vehicle repossession with no further judicial intervention or costs.

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