section 6
Security for re-payment of loans
The East Punjab Refugees Rehabilitation (House-building Loans) Act, 1948Finance194815 sections
Statutory text
- (1) When an application for loan has been sanctioned, the applicant shall execute a bond in the prescribed form undertaking to apply the money lent to the purpose or purposes for which, and to fulfil the conditions on which, the application has been sanctioned.
- (2) For a loan not exceeding Rs. 5,000 the applicant shall furnish one surety and for loans exceeding Rs. 5,000 two sureties, and the person and the property of the applicant as well as the surety or sureties, as the case may be shall be liable for the repayment of the loan with interest and costs if any, incurred in making or recovering the loan : Provided that the Controlling Authority may in any case exempt the applicant from furnishing a surety or sureties as the case may be.
- (3) When the application has been made by a firm, company or co-operative society the bond shall be executed by a duly authorised representative thereof, and the bond shall thereupon be deemed binding on the said firm, company or co-operative society and the property of the said firm, company or co-operative society shall be liable for the repayment of the loan in the same manner as if the loan had been granted to an individual.
- (4) Any plant, building material or building which the borrower purchases or builds with or with the aid of the loan advanced to him alongwith the land on which the building is constructed shall, until the loan be repaid in full, not be liable to attachment or sale in the execution of the decree or order of any Court, and 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 borrower shall be void against the [State]
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