The Usurious Loans (Tamil Nadu Amendment) Act, 1936

(1) This Act may be called the [Tamil Nadu] Amendment) Act, 1936.

(2) It extends to the whole of the [State of Tamil Nadu].

(3) The provisio~ls of this Act shall apply to all !eatraI suits to which the Usurious Loans Act, 1918 (hereinafter referred to as the said Act), would apply and which are pending on, or are instituted on or after, the date oft he commencement of this Act.

In section 3 of the said Act-

(i) in sub-section (I), for the words, letters and bracketE b e g i ~ i n g with ''has reason to believe" and ending with "any of the following powers, namely, may," the following shall be substituted, namely:-

"has reason to believe that the transaction was, as between the parties thereto, substantially unfair, the Court shall exercise one or more of the followins powers, namely--" ;

(ii) the Explanntion to the same sub-section shall be renumbered as Explanation 11 and the following shall be inserted as Explanation I, namely :-

"Explanation I.-If the interest is excessive, the Court shall presume that the transaction was subs-tantially unfair ; but such presumption may be rebutted by proof of special circumstances justifying the rate of interest." ;

(iii) to cla~ise (b) of sub-section (2), the following proviso shall be added, namely :-

"Provided that in the case of loans to agricul-turists, if co~llpound interest is charged, the Court shall presume that the interest is excessive "; and

(iv) the Explanation to clause (d) of the same sub-section sl~all be omitted.