Chapter IV SUPPLY OF MACHINERY ON THE HIRE PURCHASE SYSTEM

No machinery shall be supplied on hire-purchase system unless the applicant for the State-aid deposits with the Director such percentage (not being below ten per cent) of the cost thereof as may be prescribed.

When an application for such State-aid is allowed the Director shall, subject to and in accordance with any rules that may be made under this Act, make an order specifying the following particulars, namely:—

1. (a) the amount of each instalment of rent to be paid for the hire of the machinery and the number of such instalments to be paid before the machinery shall become the property of the hirer;
2. (b) the amount of interest, if any, to be paid along with each instalment of rent on the remaining unpaid instalment;
3. (c) the dates on which and the manner in which the aforesaid payment shall be made; and
4. (d) such other particulars as may be prescribed.

Until the hiring is terminated in the manner hereinafter provided, the following provisions shall apply, namely:—

1. (a) the hirer shall pay punctually without demand, the instalments of rent and mount of interest specified in the order referred to in section 23;
2. (b) the hirer shall retain the machinery in his own possession in good and serviceable condition and shall not without the previous written consent of the Director make any addition thereto or alteration therein, nor shall remove the machinery from the premises specified in the application for the supply thereof;
3. (c) the machinery shall remain the sole and absolute property of the State Government and any transfer thereof or assignment of any right, title or interest therein or the creation of any mortgage, encumbrance or any other charge thereon by the hirer shall be void as against the State Government unless it has been made with the previous written consent of the Director;
4. (d) The machinery shall not be liable to restraint, attachment or sale by any process under any law for the time being in force;
5. (e) the machinery shall bear a metal plate in the prescribed form and any person who wilfully removes or defaces such plate shall be liable to a fine not exceeding five hundred rupees and it shall be presumed until the contrary is proved that the machinery bearing such metal plate is the property of the State Government hired out under this Chapter;
6. (f) the hirer shall permit the Director or any person acting under his authority in this behalf to inspect the machinery at all reasonable times, and the Director or such other person shall have all such powers of entry as may be necessary for the purpose of making an inspection; and
7. (g) the hirer shall be bound by such other conditions as may be prescribed or as may be imposed by the Director in any particular case.

If the hirer makes default in payment of the rent of the machinery, the interest or any other charges payable by him under this Chapter, or fails to comply with any of the conditions specified in or imposed on him under section 24, the Director may, after considering the explanation, if any, offered by the hirer, terminate the hiring, and may himself enter or authorise any other officer in this behalf, to enter upon the premises, in which the machinery, for the time being, is kept and seize and take away the same, whether such premises belong to the hirer or not.

If the machinery is seized and taken away under section 25, the hirer shall have the option to be exercised within one month after such seizure or such longer period as may be allowed by the Director, of purchasing the same on payment to the Director of the unpaid balance of the cost thereof, such propor- tion of the interest on the said costs as may be pres- cribed and the expenses incidental to such seizure and removal.

The hirer may at any time terminate the hiring by returning the machinery to the State Govern- ment in the manner prescribed.

If the Director terminates the hiring under section 25 and the hirer does not purchase the machi- nery under section 26 or if the hirer returns the machinery to the State Government under section 27, the hirer shall not be entitled to the refund of the per- cent of the cost deposited by him under section 22, or unless the State Government otherwise directs, to the refund or remission of any payment made by or any amount due from him during the hiring and he shall be liable to pay such amount as determined by the Dire- ctor in respect of any loss or damage, other than by reasonable wear and tear, that may have been caused to the machinery during the hiring.

When the hirer, after deposit of the percentage of cost with the Director under section 22, has paid in full, all the instalments of rent, mentioned in clause

1. (a) of section 23 together with the interest, cost and other charges payable by him under this Chapter, he shall become the owner of the machinery and shall thereupon remove the metal plate mentioned in clause
2. (e) of section 24:

Penalties

1. (1) If the hirer wilfully omits after receiving due notice to remove the metal plate from any machinery which may become his property under section 29 and to return the same to the Director, he shall be liable to pay a penalty which may extend to fifty rupees.
2. (2) If the hirer causes any interference in the action of the Director or any other officer authorised by him in this behalf in entering upon the premises in which the machinery for the time being is kept, or in seizing or taking back such machinery, whether the premises belong to the hirer or not, as provided in section 25, the hirer shall be liable to pay a penalty which may extend to one hundred rupees.

All sums payable under this Chapter shall be recoverable as if they are arrears of public demand.