S.1 Short title, extent and commencement

       (1) This Act may be called the Hire-purchase Act, 1972.
       (2) It extends to the whole of India except the State of Jammu and Kashmir.1
       (3) It shall come into force on such date2 as the Central Govern­ment may, by notification in the Official Gazette, appoint.
       -----------------------------------------
       1.   The Act has not been extended to the State of Sikkim.
       2.   This Act was to come into force on 1st June, 1973, vide GSR 222 (E), dated 30th April, 1973, but this notification was rescinded by GSR 288 (E) dated 31st May, 1973 and the Act was made effective from 1-9-1973 but this notification was also rescinded by GSR 402 (E) dated 30th August, 1973. This Act has not come into force as yet
  &nbs

S.2 Definitions

       In this Act, unless the context otherwise requires,—
       (a) “contract of guarantee”, in relation to any hire-purchase agreement, means a contract whereby a person (in this Act re­ferred to as the surety) guarantees the performance of all or any of the hirer’s obligations under the hire-purchase agreement;
       (b) “hire” means the sum payable periodically by the hirer under a hire-purchase agreement;
       (c) “hire-purchase agreement” means 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 includes an agreement under which—
       (i) possession of goods is delivered by the owner thereof to a person on condition that such person pays the agreed amount in

S.3 Hire-purchase agreements to be in writing and signed by par­ties thereto

       (1) Every hire-purchase agreement shall be—
       (a) in writing, and
       (b) signed by all the parties thereto.
       (2) A hire-purchase agreement shall be void if in respect thereof any of the requirements specified in sub-section (1) has not been complied 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 agreement is not so signed, the hire-purchase agreement shall be voidable at the option of the onwer.

S.4 Contents of hire-purchase agreements

       (1) Every hire-purchase agreement shall state—
       (a) the hire-purchase price of the goods to which the agreement relates;
       (b) the cash price of the goods, that is to say, the price at which the goods may be purchased by the hirer for cash;
       (c) the date on which the agreement shall be deemed to have commenced;
       (d) the number of instalments by which the hire-purchase price is to be paid, the amount of each of those instalments, and the date, or the mode of determining the date, upon which it is payable, and the person to whom and the place where it is pay­able; and
       (e) the goods to which the agreement relates, in a manner suffi­cient to identify them.
      &nbs

S.5 Two or more agreements when treated as a single hire-purchase agreement

       Where by virtue of two or more agreements in writing, none of which by itself constitutes a hire-purchase agreement, there is a bailment of goods and the bailee has an option to purchase the goods and the requirements of section 3 and section 4 are satisfied in relation to such agreements, the agreements shall be treated for the purposes of this Act as a single hire-purchase agreement made at the time when the last of the agree­ments was made.

S.6 Warranties and conditions to be implied in hire-purchase agreements

       (1) Notwithstanding anything contained in any con­tract, in every hire-purchase agreement there shall be an implied warranty—
       (a) that the hirer shall have and enjoy quiet possession of the goods; and
       (b) that the goods shall be free from any charge or encumbrance in favour of any third party at the time when the property is to pass.
       (2) Notwithstanding anything contained in any contract, in every hire-purchase agreement there shall be—
       (a) an implied condition on the part of the owner that he has a right to sell the goods at the time when the property is to pass;
       (b) an implied condition that the goods shall be of merchantable quality, but no such condition shall be implied by virtue of this

S.7 Limitation on hire-purchase charges

       (1) In this section,—
       (a) “cash price instalment”, in relation to a hire-purchase instalment, means an amount which bears to the net cash price the same proportion as the amount of the hire-purchase instalment bears to the total amount of hire-purchase price;
       (b) “deposit” means any sum payable by the hirer under the hire-purchase agreement by way of deposit or other initial payment or credited or to be credited to him under the agreement on account of any such deposit or payment, whether that sum is to be or has been discharged by payment of money or by transfer or delivery of goods or by any other means;
       (c) “net cash price”, in relation to goods comprised in a hire-purchase agreement, means the cash price of such goods as re­quired to be specified in the hire-purchase agreement und

S.8 Passing of property

       Subject to the provisions of this Act, the property in the goods to which a hire-purchase agreement relates shall pass to the hirer only on the completion of the purchase in the manner provided in the agreement.

S.9 Right of hirer to purchase at any time with rebate

       (1) The hirer may, at any time during the continuance of the hire-purchase agreement and after giving the owner not less than fourteen days’ notice in writing of his intention so to do, complete the pur­chase of the goods by paying or tendering to the owner the hire-purchase price or the balance thereof as reduced by the rebate calculated in the manner provided in sub-section (2).
       (2) The rebate for the purposes of sub-section (1) shall be equal to two-thirds of an amount which bears to the hire-purchase charges the same proportion as the balance of the hire-purchase price not yet due bears to the hire-purchase price.
       Explanation.—In this sub-section “hire-purchase charges” means the difference between the hire-purchase price and the cash price as stated in the hire-purchase agreement.
       (3) The

S.10 Right of hirer to terminate agreement at any time

       (1) The hirer may, at any time before the final payment under the hire-purchase agreement falls due, and after giving the owner not less than fourteen days’ notice in writing of his intention so to do and re-delivering or tendering the goods to the owner, terminate the hire-purchase agreement by payment or tender to the owner of the amounts which have accrued due towards the hire-purchase price and have not been paid by him, including the sum, if any, which he is liable to pay under sub-section (2).
       (2) Where the hirer terminates the agreement under sub-section (1), and the agreement provides for the payment of a sum named on account of such termination, the liability of the hirer to pay that sum shall be subject to the following conditions, namely:—
       (a) where the sum total of the amounts paid and the amounts due in respect of the hir

S.11 Right of hirer to appropriate payments in respect of two or more agreements

       A hirer who is liable to make payments in respect of two or more hire-purchase agreements to the same owner shall, notwithstanding any agreement to the contrary, be enti­tled, on making any payment in respect of the agreement which is not sufficient to discharge the total amount then due under all the agreements to appropriate the sum so paid by him in or to­wards the satisfaction of the sum due under any one of the agreements, or in or towards the satisfaction of the sums due under any two or more of the agreements in such proportions as he thinks fit, and, if he fails to make any such appropriation as aforesaid, the sum so paid shall, by virtue of this section, stand appropriated towards the satisfaction of the sums due under the respective hire-purchase agreements in the order in which the agreements were entered into.

S.12 Assignment and transmission of hirer’s right or interest under hire- purchase agreement

       (1) The hirer may assign his right, title and interest under the hire-purchase agreement with the consent of the owner, or, if his consent is unreasonably withheld, without his consent.
       (2) Except as otherwise provided in this section, no payment or other consideration shall be required by an owner for his consent to an assignment under sub-section (1), and where an owner re­quires any such payment or other consideration for his consent, that consent shall be deemed to be unreasonably withheld.
       (3) Where on a request being made by a hirer in this behalf the owner fails or refuses to give his consent to an assignment under sub-section (1) the hirer may apply to the court for an order declaring that the consent of the owner to the assignment has been unreasonably withheld, and where such an order is made the consent shall be deemed to be u

S.13 Obligations of hirer to comply with agreement

       Subject to the provisions of this Act, a hirer shall be bound—
       (a) to pay the hire in accordance with the agreement, and
       (b) otherwise to comply with the terms of the agreement.

S.14 Obligation of hirer in respect of care to be taken of goods

       (1) A hirer in the absence of a contract to the contrary,—
       (a) shall be bound to take as much care of the goods to which the hire-purchase agreement relates as a man of ordinary prudence would, under similar circumstances, take of his own goods of the same bulk, quality and value;
       (b) shall not be responsible for the loss, destruction or dete­rioration of the goods, if he has taken the amount of care there­of described in clause (a).
       (2) The hirer shall be liable to make compensation to the owner for any damage caused by failure to take care of the goods in accordance with the provisions of sub-section (1).

S.15 Obligation of hirer in respect of use of goods

       If the hirer makes any use of the goods to which the hire-purchase agreement relates which is not according to the conditions of the agree­ment, the hirer shall be liable to make compensation to the owner for any damage arising to the goods from or during such use.

S.16 Obligation of hirer to give information as to whereabouts of goods

       (1) Where by virtue of a hire-purchase agreement a hirer is under a duty to keep in his possession or control the goods to which the agreement relates, the hirer shall, on receipt of a request in writing from the owner, inform the owner where the goods are at the time when the information is given or, if it is sent by post, at the time of posting.
       (2) If the hirer fails without reasonable cause to give the said information within fourteen days of the receipt of the notice, he shall be punishable with fine which may extend to two hundred rupees.

S.17 Rights of hirer in case of seizure of goods by owner

       (1) Where the owner seizes under clause (c) of section 19 the goods let under a hire-purchase agreement, the hirer may recover from the owner the amount, if any, by which the hire-purchase price falls short of the aggregate of the following amounts, namely:—
       (i) the amounts paid in respect of the hire-purchase price up to the date of seizure;
       (ii) the value of the goods on the date of seizure.
       (2) For the purposes of this section, the value of any goods on the date of seizure is the best price that can be reasonably obtained for the goods by the owner on that date less the aggregate of the following amounts, namely:—
       (i) the reasonable expenses incurred by the owner for seizing the goods;
       (ii)

S.18 Rights of owner to terminate hire-purchase agreement for default in payment of hire or unauthorised act or breach of express conditions

       (1) Where a hirer makes more than one default in the payment of hire as provided in the hire-purchase agreement then, subject to the provisions of section 21 and after giving the hirer notice in writing of not less than--
       (i) one week, in a case where the hire is payable at weekly or lesser intervals; and
       (ii) two weeks, in any other case, the owner shall be entitled to terminate the agreement by giving the hirer notice of termination in writing:
       Provided that if the hirer pays or tenders to the owner the hire in arrears together with such interest thereon as may be payable under the terms of the agreement before the expiry of the said period of one week or. as the case may be, two weeks, the owner shall not be entitled to terminate the agreement.
       (

S.19 Rights of owner on termination

       Where a hire-purchase agree­ment is terminated under this Act, then the owner shall be enti­tled,—
       (a) to retain the hire which has already been paid and to recover the arrears of hire due:
        Provided that when such goods are seized by the owner, the reten­tion of hire and recovery of the arrears of hire due shall be subject to the provisions of section 17;
       "
       (b) subject to the conditions specified in clauses (a) and (b) of sub-section (2) of section 10, to forfeit the initial deposit, if so provided in the agreement;
       (c) subject to the provisions of section 17 and section 20 and subject to any contract to the contrary, to enter the premises of the hirer and seize the goods;
  

S.20 Restriction on owner’s right to recover possession of goods otherwise than through court

       (1) Where goods have been let under a hire-purchase agreement and the statutory proportion of the hire-purchase price has been paid, whether in pursuance of the judgment of a court or otherwise, or tendered by or on behalf of the hirer or any surety, the owner shall not enforce any right to recover possession of the goods from the hirer otherwise than in accordance with sub-section (3) or by suit.
       Explanation.—In this section, “statutory proportion” means,—
       (i) one-half, where the hire-purchase price is less than fifteen thousand rupees; and
       (ii) three-fourths, where the hire-purchase price is not less than fifteen thousand rupees:
       Provided that in the case of motor vehicles as defined in the Motor Vehicles Act, 1939 (4 of 1939), “statutory pr

S.21 Relief against termination for non-payment of hire

       Where the owner, after he has terminated the hire-purchase agreement in accordance with the provisions of sub-section (1) of section 18, institutes a suit or makes an application against the hirer for the recovery of the goods, and at the hearing of the suit or application, the hirer pays or tenders to the owner the hire in arrears, together with such interest thereon as may be payable under the terms of the agreement and the costs of the suit or application incurred by the owner and complies with such other conditions, if any, as the court may think fit to impose, the court may, in lieu of making a decree or order for specific delivery, pass an order relieving the hirer against the termina­tion; and thereupon the hirer shall continue in possession of the goods as if the agreement had not been terminated.

S.22 Relief against termination for unauthorised act or breach of express condition

       Where a hire-purchase agreement has been terminated in accordance with the provisions of clause (a) or clause (b) of sub-section (2) of section 18, no suit or application by the owner against the hirer for the recovery of the goods shall lie unless and until the owner has served on the hirer a notice in writing,--
       (a) specifying the particular breach or act complained of; and
(b) if the breach or act is capable of remedy, requiring the hirer to remedy it, and the hirer tails, within a period of thirty days from the date of the service of the notice, to remedy the breach or act if it is capable of remedy.

S.23 Obligation of owner to supply copies and information

       (1) It shall be the duty of the owner to supply, free of cost, a true copy of the hire-purchase agreement, signed by the owner,—
       (a) to the hirer, immediately after execution of the agreement; and
       (b) where there is a contract of guarantee, to the surety, on demand made at any time before the final payment has been made under the agreement.
       (2) It shall also be the duty of the owner, at any time before the final payment has been made under the hire-purchase agreement, to supply to the hirer, within fourteen days after the owner re­ceives a request in writing from the hirer in this behalf and the hirer tenders to the owner the sum of one rupee for expenses, a statement signed by the owner or his agent showing—
       (a) the amount paid by or on b

S.24 Discharge of price otherwise than by payment of money

       Where an onwer has agreed that any part of the hire-purchase price may be discharged otherwise than by the payment of money, any such discharge shall, for the purposes of section 10, section 11, section 17, section 20 and section 23, be deemed to be a payment of that part of the hire-purchase price.

S.25 Insolvency of hirer, etc.

       (1) Where, during the continuance of the hire-purchase agreement, the hirer is adjudged insolvent under any law with respect to insolvency for the time being in force, the Official Receiver or where the hirer is a company, then in the event of the company being wound up, the liquidator, shall have, in respect of the goods which are in the possession of the hirer under the agreement, the same rights and obligations as the hirer had in relation thereto.
       (2) The Official Receiver or the liquidator, as the case may be, may, with the permission of the Insolvency Court or the court in which the winding up proceedings are pending, assign the rights of the hirer under the agreement, to any other person, and the assignee shall have all the rights and be subject to all the obligations of the hirer under the agreement.
       Explanation.—In this section,

S.26 Successive hire-purchase agreements between same parties

       Where goods have been let under a hire-purchase agree­ment, and at any time thereafter the owner makes a subsequent hire-purchase agreement with the hirer, whether relating exclu­sively to other goods or to other goods together with the goods to which the first agreement relates, any such subsequent hire-purchase agreement shall not have effect in so far as it affects prejudicially any right which the hirer would have had by virtue of section 20 under the first agreement, if such subsequent hire-purchase agreement had not been made.

S.27 Evidence of adverse detention in suit or application to recover possession of goods

       (1) Where, in a suit or application by an owner of goods which have been let under a hire-purchase agreement, to enforce a right to recover possession of the goods from the hirer, the owner proves that, before the commencement of the suit or application and after the right to recover possession of the goods accrued, the owner made a request in writing to the hirer to surrender the goods, the hirer’s possession of the goods shall, for the purpose of the owner’s claim to recover possession thereof, be deemed to be adverse to the owner.
       (2) Nothing in this section shall affect a claim for damages for conversion.

S.28 Hirer’s refusal to surrender goods not to be conversion in certain cases

       If, during the subsistence of any restriction to which the enforcement by an owner of a right to recover posses­sion of goods from a hirer is subject by virtue of this Act, the hirer refuses to give up possession of the goods to the owner, the hirer shall not, by reason only of such refusal, be liable to the owner for conversion of goods.

S.29 Service of notice

       Any notice required or authorised to be served on or given to an owner or a hirer under this Act may be so served or given—
       (a) by delivering it to him personally; or
       (b) by sending it by post to him to his last known place of residence or business.

S.30 Power to exempt from provisions of sections 6, 9, 10, 12 and 17 in certain cases

       Where the Central Government is satisfied that having regard to—
       (a) the short supply of any goods or class of goods, or
       (b) the use or intended use of any goods or class of goods and the persons by whom such goods or class of goods are used or intended to be used, or
       (c) the restrictions imposed upon the trade or commerce in any goods, or class of goods, or
       (d) any other circumstances in relation to any goods or class of goods,
       it is necessary or expedient in the public interest so to do. The Central Government may, by notification in the Official Gazette, direct that clause (b) of sub-section (2) of section 6, section 9, section 10, section 12 and section 17 or any of them shall not apply or