Keyword(s):
Central Act Amendment, The Usurious Loans Act, 1918

An Act to amend the Usurious Loans Act, 1918,
in its application to th? 3[State of Tamil Nadu],
for certain purposes.
‘e~lts;tl WHEREASit is expedient to amend the Usurious Loans
‘(of Act, 1918, in its application to the ‘[State of Tamil

  1. Nadu], for the purpose hereinafter appearing ;
    ANDWHEREASthe previous sanction of the Governor-
    General has been obtained to the passing of this Act;
    It is hereby enacted as follows :-
  2. (1) This Act may be called the Usurious Loans short title,
    extent and
    application
    C
    (‘[Tamil Naduj Amendment) Act, 1936. –
    (2) It extends to the whole of the 3[State of
    Tamil Nadu].
    (3) The provisio~lsof this Act shall apply to all
    !eatraI suits to which the Usurious Loans Act, 1918 (herein-
    L
    918′
    after referred to as the said Act), would apply and
    ~
    ~
    ~
    ~
    which are pending on, or are instituted on or after,
    the date ofthe commencement of this Act.
    1 Thew words were substituted for the word ” Madras” by the
    Tamil Nadu Adaptation of Laws Order, 1969, as amended by the
    Tamil Nstdu Adaptation of Laws (Second Amendment) Order, 1969.
    For Statement of Objects and Reasons, see Fort &.George
    Uazene, dated the 4th November 1936,Part IV, pages 360-361.
    a This expression was substituted for the expression “Presi-
    dency of Madras *’ by the Tam11 Nadu Adaptation of Laws Order,
    1970,which was deemed to have come into force onthe 14th January
    1969.
    I
    Y
    i.iI.
    *
    ..
    506 Usurious Loans [I937:T.N. Act VIU
    (Tmil Nodu et)
    Aw-t of 2. In section 3 of the said Act-
    section 3,
    central
    ActX of
    1918-
    (i) in sub-section (I), for the words, letters and
    bracketE begi~ingwith ”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 11and 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~llpoundinterest is charged, the Court
    shall presume that the interest is excessive “; and
    (iv) the Explanation to clause (d) of the same
    sub-section sl~allbe omitted.

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