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Forcible repossession of vehicle is illegal

A financier cannot take forcible action to repossess a vehicle. It has to adopt a juridical remedy and cannot take the law in its hands

Jehangir B Gai

It is common to find finance companies refusing to sanction a loan unless the borrower gives his signatures on blank papers. This enables financiers to misuse these pre-signed documents. K Subrahmanyan wanted to purchase a lorry. He approached Shriram Transport Finance. He was compelled to sign on blank papers before the loan was approved. The company then sanctioned a loan of Rs 2,20,000. A loan-cum-hypothecation agreement was executed that provided for paying an EMI (equated monthly instalment) of Rs8,500 for three years. Subramanyan paid his EMIs on time. There was just one ...