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

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 instance of delay, for which he paid Rs 11,500 in