section 6
Security for repayment of loans
The East Punjab Refugees Rehabilitation (Loans and Grant) Act, 1948Finance194816 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. 2,000 the applicant shall furnish one surety and for loans exceeding Rs. 2,000 two sureties, and the person and property of the applicant as well as the surety or the 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 '[Co-operative Society], firm or company the bond shall be executed by a duly authorised representative thereof and the bond shall thereupon be deemed binding on the said '[Co-operative Society], firm or company and the property of the said '[Co-operative Society], firm or company shall be liable for the repayment of the loan in the same manner as if the loan had been granted to an individual. [(3-A) When the application has been made by a group, the bond shall be executed by all the members of the group and the bond shall thereupon be deemed binding on all the members of the group jointly and severally and the property of the said group and of all the members of the group shall be liable for the repayment of the loan.]
- (4) Any plant or machinery which the borrower purchases with or with the aid of the loan advanced to him shall, until the loan be repaid in full, 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] Government, unless it has been made with the previous written consent of the Controlling Authority. [(5) Any plant or machinery such as is referred to in the last preceding sub-section, and the stock in trade of the borrower purchased with or with the aid of the loan advanced to him shall, until the loan be repaid in full, not be liable to attachment or sale in the execution of a decree or order of any court.]
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