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Report No. 168

2. Amendment of section 2.-

In section 2 of the Hire-purchase Act, 1972 (hereinafter referred to as the principal Act),-

(a) for clause (c), the following clause shall be substituted, namely:-'

(c) "hire-purchase agreement" means-

(i) an agreement under which goods are let on hire and under which the hirer has an option to purchase them in accordance with the terms of the agreement, and

(ii) an agreement for the sale of goods under which the purchase price or part of it is payable in instalments, and the property in the goods is to remain in the owner (notwithstanding that the hirer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise, as may be specified in the agreement, are fulfilled.'

(b) for clause (d), the following clause shall be substituted, namely:-

(d) "hire-purchase price" means the total sum payable by the hirer under a hire-purchase agreement in order to complete the purchase of or the acquisition of property in, the goods to which the agreement relates; and includes any sum so payable by the hirer under the hire-purchase agreement by way of a deposit or other initial payment, or credited or to be credited to him under such agreement on account of any such deposit or payment, whether that sum is to be or has been paid to the owner or to any other person authorised by the owner or is to be or has been discharged by payment of money or by transfer or delivery of goods or by any other means; but does not include any sum payable as a penalty or as compensation or damage for a breach of the agreement, and also does not include any sum-

(i) payable as expenses for delivering the goods to the hirer and the installation thereof, in accordance with the terms of the agreement, or

(ii) payable as any fee, in respect of the goods and the agreement, for the purposes of registration or otherwise under any law for the time being in force, or

(iii) payable as insurance premium, or

(iv) payable as penalty, compensation or damages for a breach of the agreement.'

(c) for clause (f), the following clause shall be substituted, namely:-

'(f) "owner" means the person who lets or has let, or the person who delivers or has delivered possession of goods, to a hirer under a hire-purchase agreement and Includes a person to whom the owner's property in the goods or any of the rights or liabilities under the agreement has passed by assignment or by operation of law.'

(d) After clause (f), the following clause shall be inserted namely:-

'(ff) "prescribed" means prescribed by rules made under this Act;'

2. Amendment of section 3.-

For section 3, the following section shall be substituted, namely,-

"3. Hire-purchase agreement to be in writing and signed by parties thereto.-(1) Every hire-purchase agreement shall be-

(a) in writing;

(b) signed by all parties thereto; and

(c) accompanied by a declaration in the prescribed form containing the main rights and obligations of the hirer and signed by all the parties to the agreement.

(2) A hire-purchase agreement shall be void against the hirer if any of the requirements specified in sub-section (1) has not been compiled with.

(3) Where there is a contract of guarantee, the hire-purchase agreement shall be signed by the surety also, and if the hire-purchase greement is not so signed, it shall be voidable at the option of the owner.

(4) The Hire-purchase Agreement and the declaration shall be executed in two sets, duly signed by the parties. One such set shall be handed over to the hirer and where there is a surety, yet another set to the surety, immediately after the execution of the Agreement."

The Hire-Purchase Act, 1972 Back

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