Vol. 17, Part I · pages 301–305

276 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES Particulars of license to be given in the plaint 36. (1) Every plaint by a money-lender shall contain the particulars of the license held by him at the time when the transaction in the suit was entered into; (2) If a money-lender without lawful excuse fails to comply with the provisions of sub-section (i) of this section the court shall order him to pay to the defendant the cost of the suit. Interrogatories to be delivered to money-lender 37. (1) In any suit or proceedings for accounts or for the recovery of money lent or advanced if the person lending or advancing the money denies that he is a money-lender the court shall deliver to such person interrogatories for the purpose of ascertaining- (a) whether he either alone or in conjunction with or in the name or through the agency of any other person or persons or corporation, made any and if so what loan or loans or advances within a reasonable time before and after the date of the transaction in suit or proceedings and if so, (b) whether he or any and if so on what occasion or occasions, lent or advanced money under any name other than his own name and; (c) whether he has been registered as a money-lender under his own or any other or what name as a money-lender and if so when. (2) The provisions of Order 11 of the Code of Civil Procedure, 1908 shall apply to such interrogatories. Power of Court to re-open certain transactions 38. Where in any suit or proceedings instituted after or pending at the time when this Act comes into force the transaction discloses that– (a) the interest is excessive, or (b) the transaction is as between the parties therein, unconscionable,

277A BILL............MONEY-LENDING the court shall exercise one or more of the following powers, namely— (i) re-open the transaction, take an account between the parties and relieve the debtor of all liability in respect of any excessive interest, (ii) notwithstanding any agreement, purporting to close previous dealings and create a new obligation, re-open any account already taken between them and relieve the debtor of all liability in respect of any excessive interest, and if anything has been paid or allowed in account in respect of such liability, order the money-lender to re-pay any sum which it considers to be re-payable in respect thereof, (iii) set aside either wholly or in part or revise or alter any security given or agreement made in respect of any loan, and if the money-lender has parted with the security, order him to indemnify the debtor in such manner and to such extent as it may deem fit. Certain transactions not to be re-opened 39. In the exercise of the powers conferred by section 38 the court shall not— (i) re-open any agreement purporting to close previous dealings and to create a new obligation which has been entered into by the parties or any person from whom they claim at a date more than twenty years from the date of the transaction, or (ii) do anything which affects any decree of a court. Explanation.—In the case of a suit brought on a series of transactions for the purposes of clause (i)of section 38 the expression “transaction” means the first of such transactions.

278 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES Rate of interest when deemed excessive. 40. For the purposes of section 37, interest shall be deemed to be excessive if— (i) in the case of an unsecured loan it is at a rate in excess of three times, (ii) in the case of a loan secured by a second or subsequent mortgage it is at a rate in excess of two and a half times, (iii) in the case of loan secured by a first mortgage or pledge it is at a rate in excess of one and a half times, the Bank rate of the Reserve Bank or of the Imperial Bank or the Bank of Bombay, as the case may be, at the date of the loan or transaction. Mode of taking account 41. The account under section 37 shall be taken in accordance with the following rules, that is to say— (i) separate accounts of principal and interest shall be taken, (ii) in the account of the principal there shall be debited to the debtor such money as has from time to time been actually received by him from the money-lender and the price of goods, if any, sold to him by the moneylender as part of the transaction, (iii) in the account of the principal there shall not be debited to the debtor any accumulated interest which had been converted into principal at any settlement of account or by any contract made in the course of the transaction, (iv) in the account of interest there shall be debited to the debtor monthly simple interest on the balance of principal for the time being outstanding at a rate agreed between the parties but in no case exceeding the rates specified in section 38, (v) all moneys paid by or on account of the debtor to the money-lender or on his account, and all payments in kind, all profits, service or other advantages of every

279A BILL............MONEY-LENDING description received by the money-lender in the course of the transaction shall be credited first in the account of interest and when any payment is more than sufficient to discharge the balance of interest due at the time it is made, the residue of such payment shall be credited to the debtor in the account of the principal. Explanation.—Where for purposes of accounting it is necessary to estimate in terms of money the value of any profits, services or advantages received by the moneylender including profits, rents and other advantages of property in the possession of the moneylender held by him as a security for the loan, the same shall be determined in accordance with the market rates prevailing on material dates or with the aid of assessors appointed by the court or failing which by the court in its own discretion, (vi) the accounts of principal and interest shall be made upto the date of instituting the suit and the aggregate of the balance due on both such accounts against the debtor on that date shall be deemed to be the amount due at that date, except when the balance appearing due on the interest account exceeds that appearing due on the principal account, in which case double the latter balance shall be deemed to be the amount then due. Power to direct payment of amount due on mortgage decree by instalments. 42. The court may, at any application of a judgementdebtor, after notice to the decree-holder, direct that the amount of any decree passed before or after the commencement of this Act, in respect of a loan, including any decree in a suit relating to a mortgage by which a loan is secured shall be paid in such number of instalments and subject to such conditions on the dates fixed by it as, having regard to the circumstances of the judgement-debtor and the amount of the decree, it considers fit.

280 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES Decree may direct payment of amount due on mortgage by instalment. The court may at the time of passing the decree in any suit relating to a mortgage by which any loan is secured order that payment of any amount decreed in such suit, shall be made by instalments notwithstanding anything to the contrary contained in any contract between the money-lender and the person to whom the loan was advanced. Court to estimate the value of judgement-debtor’s property. 44. When an application is made for the execution of a decree by the attachment and sale of the judgement-debtor’s property, the court executing the decree, shall, notwithstanding anything contained in the Code of Civil Procedure, 1908, hear the parties to the decree and estimate the value of such property and of that portion of such property the proceeds of the sale of which it considers will be sufficient to satisfy the decree. Only sufficient portion of judgement debtor’s property to be sold. 45. Notwithstanding anything contained in the Code of Civil Procedure, 1908, the proclamation of the intended sale shall include only so much of the property the proceeds of the sale of which the court considers will be sufficient to satisfy the decree and such property shall not be sold at a price lower than the price specified in the said proclamation. Saving of power of court under Usurious Loans Act. 46. Except as is otherwise provided by this Act nothing herein contained shall affect the powers of a Court under the Usurious Loans Act, 1918. Contract for payment outside the Province void. 47. Any contract entered into between a money-lender and his debtor in respect of a loan advanced after the commencement of this Act providing for the payment of the amount due on such loan at any place outside the province of Bombay shall be void.