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Hire Purchase Act, 1972


20. Restriction on owner’s right to recover possession of goods otherwise than through court.-

(1) Where goods have been let under a hire-purchase agreement and the statutory proportion of the hire-purchase price has been paid, whether in pursuance of the judgment of court or otherwise, or tendered by or on behalf of the hirer or any surety, the owner shall not enforce any right to recover possession of the goods from the hirer otherwise than in accordance with sub-section (3) or by suit.

Explanation.- In this section, "statutory proportion" means.- one-half, where the hire-purchase price is less than fifteen thousand rupees and, three-fourths, where the hire-purchase price is not less than fifteen thousand rupees.

Provided that in the case of motor vehicles as defined in the Motor Vehicles Act, 1939 (4 of 193(0, ":statutory proportion" shall mean.- one-half where the hire-purchase price is less than five thousand rupees.

Three-fourths, where the hire-purchase price is not less than five thousand rupees but less than fifteen thousand rupees.

Three-fourths or such higher proportion not exceeding nine-tenths as the Central Government may, by notification in the Official Gazette, specify, where the hire-purchase price is not less than fifteen thousand rupees.

If the owner recovers possession of goods in contravention of the provisions of sub-section (1), the hire-purchase agreement, if not previously terminated, shall terminate, and - the hirer shall be released from all liability under the agreement and shall be entitled to recover from the owner all sums paid by the hirer under the agreement or under any security given by him in respect thereof, and

The surety shall be entitled to recover from the owner all sums paid by him under the contract of guarantee or under any security given by him in respect thereof.

Where, by virtue of the provisions of sub-section (1), the owner is precluded from enforcing a right to recover possession of goods, he may make an application for recovery of possession of the goods to any court having jurisdiction to entertain a suit for the same relief.

The provisions of this section shall not apply in any case in which the hirer has terminated the agreement by virtue of any right vested in him.



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