KARNATAKA DEBT RELIEF ACT, 1976
25 of 1976
22nd January, 1976
STATEMENT OF OBJECTS AND REASONS [KARNATAKA ACT No. 25 OF 1976] Karnataka Gazette, dated 22-1-1976 The problem of Urban and Rural indebtedness from sources other than Government and institutional agencies has assumed serious dimensions in recent time. One of the factors responsible being the tightness in the money market. Exorbitant rates of interest are being charged and malpractices are being indulged. Agriculturists with small holdings, landless agricultural labourers and the weaker sections of the community have all been exploited. The State Government, therefore, considered it necessary to provide adequate relief to the said categories. This is consistent with the 20 point programme announced by the Prime Minister also. Hence the Karnataka Debt Relief Ordinance, 1975 was issued declaring that debts owed by the aforesaid categories stood discharged. The Bill is to replace the said Ordinance.
An Act to provide relief from indebtedness to small farmers, landless agricultural labourers and weaker sections of the people in the State of Karnataka. Whereas, it is expedient to provide relief from indebtedness to small farmers, landless agricultural labourers and weaker sections of the people in the State of Karnataka; Be it enacted by the Karnataka State Legislature in the Twenty- seventh Year of the Republic of India as follows :-
Section1 Short title, extent and commencement
(1) This Act may be called the Karnataka Debt Relief Act, 1976.
(2) It extends to the whole of the State of Karnataka.
(3) Sections 3, 4, 7 and 8 shall be deemed to have come into force on the twenty-first day of October, 1975. Sections 5 and 6 shall be deemed to have come into force on the eleventh day of November, 1975 and Section 9 shall be deemed to have come into force on the twenty-eighth day of November, 1975.
Section2 Declaration
It is hereby declared that this Act is for giving effect to the policy of the State towards securing the principles specified in Article 46 of the Constitution of India.
Section3 Definitions
In this Act, unless the context otherwise requires,
(b) "Debt" means any liability in cash or in kind, whether decreed or not and includes any amount which is in substance a debt; but does not include arrears of taxes due to the Central or the State Government or a local authority;
(d) "Landless agricultural labourer" means a person who does not hold any land and whose principal means of livelihood is manual labour on land;
(e) "Small farmer" means a person who holds whether as owner, tenant, or mortgagee with possession or partly in one capacity and partly in another not more than one unit of land and who has no income from any source other than agriculture;
Explanation. Where a person holds more than one category of land referred to in clause (f), the extent of land held by him shall be determined according to the following formula namely: Two hectares of unirrigated lands - one and one-fourth hectares of rain- fed wet land = half hectare of land having facilities for growing one irrigated crop = half hectare of land used for growing plantation crops or grape or coconut or arecanut or for growing mulberry by irrigation - quarter hectare of land having perennial irrigation facilities or facilities for growing more than one irrigated crop in a year;
(f) "Unit" means
(ii) one and one-fourth hectares of rainfed wet lands; or
(iii) half hectare of land having facilities for growing one irrigated crop; or
(iv) half hectare of land used for growing plantation crops or grapes or coconut or arecanut; or
(v) half hectare of land used for growing mulberry by irrigation; or
(vi) quarter hectare of land having perennial irrigation facilities or facilities for growing more than one irrigated cropin a year;
Explanation. In this clause 'plantation crop' means cardamom, coffee, rubber and tea;
(g) "Weaker sections of the people" means persons not being small farmers or landless agricultural labourers, whose annual income from all sources does not exceed two thousand and four hundred rupees.
Section4 Relief from indebtedness
Notwithstanding anything in any law for the time being in force or in any contract or instrument having force by virtue of any such law and save as otherwise expressly provided in this Act, with effect from the date of commencement of this section,
(a) every debt advanced before the commencement of this section including the amount of interest, if any, payable by the debtor to the creditor shall be deemed to be wholly discharged;
(d) every debtor undergoing detention in a civil prison in execution of any decree for money passed against him by a Civil Court in respect of any such debt shall be released;
Explanation. Nothing in this section shall be construed as entitling any debtor for refund of any part of any debt already repaid by him or recovered from him before the commencement of this section.
Section5 Creditors to file statement, etc.
(8) Pending determination of the question under sub-section (2), no creditor shall sell or dispose of the articles pledged.
Section6 Penalty
(1) Any person failing to furnish the statement or to comply with the order made under Section 5 or otherwise contravening the provisions of Section 5 shall be liable to imprisonment for a term which shall not be less than three months but which may extend to one year and with fine which shall not be less than one thousand rupees but which may extend to five thousand rupees
(2) Every offence punishable under sub-section (1) shall be cognizable
Section7 Burden of proof
Notwithstanding anything in any law, in any suit or proceeding, the burden of proving that the debtor is not entitled to protection of this Act shall lie on the creditor.
Section8 Certain debts and liabilities not to be affected
Nothing in this Act shall affect the following categories of debts and liabilities of small farmers, landless agricultural labourers and weaker sections of the people, namely:
(a) any rent due in respect of any property let out to such debtor;
(b) any amount due under a hire purchase agreement;
(c) any amount recoverable as arrears of land revenue;
(d) any liability arising out of breach of trust, or any tortous liability;
(e) any liability in respect of wages or remuneration due as salary or otherwise for services rendered;
(f) any liability in respect of maintenance whether under a decree of a court or otherwise;
(h) and debt which represents the price of goods purchased by such debtor
Section9 Power to make rules
The State Government may, by notification in the official Gazette make rules to carry out the purposes of this Act.
Section10 Repeal of Karnataka Ordinance Nos. 15 of 1975,19 of 1975 and 21 of 1975.
(1) The Karnataka Debt Relief Ordinance, 1975 (Karnataka Ordinance No. 15 of 1975), the Karnataka Debt Relief (Amendment) Ordinance, 1975 (Karnataka Ordinance No. 19 of 1975) and the Karnataka Debt Relief (Second Amendment) Ordinance, 1975 (Karnataka Ordinance No. 21 of 1975) are hereby repealed.
(2) Notwithstanding such repeal anything done or any action taken under the said Ordinance, shall be deemed to have been done or taken under the corresponding provisions of this Act.
RULE
KARNATAKA DEBT RELIEF RULES, 1975
In exercise of the powers conferred by Section 6-A of the Kar- nataka Debt Relief Ordinance, 1975 (Karnataka Ordinance No. 15 of 1975), the Government of Karnataka hereby makes the following rules, namely:-
Rule1 Title and commencement
(1) These rules may be called the Karnataka Debt Relief Rules, 1975.
(2) They shall come into force at once.
Rule2 Definitions
In these rules, unless the context otherwise requires.
(a) "Form" means a form appended to these rules;
(b) "Ordinance" means the Karnataka Debt Relief Ordinance, 1975;
(c) "Section" means a section of the ordinance
Rule3 Other particulars to be furnished
In addition to the particulars specified in sub-section(1) of Section 4-A, a creditor shall also furnish in the statement referred to in the said sub-section the estimated annual income of the debtor. The said statement shall be in Form 1.
Rule4 Service of Notice
On receipt of the said statement, a notice shall be served on the debtor along with an extract of the statement relating to him, calling upon him to file his objections, if any, to the particulars relating to him in the statement. The notice shall specify the date on or before which the objections should be filed. The Sub-Divisional Magistrate shall also intimate the creditor and the debtor the date, which shall not be earlier to the date specified in the notice, on which and the place at which a summary enquiry shall be held.
Rule5 Receipt for articles delivered by the creditor
(1) In respect of every article delivered by the creditor in pursuance of an order made under subsection (2) of the Section 4-A, the Sub-Divisional Magistrate, shall give a re- ceipt in Form 2.
(2) A debtor shall, in respect of every article delivered to him by the Sub-Divisional Magistrate, give an acknowledgement in Form 3.
Rule6 Maintenance of register
Every statement furnished by a creditor under sub-section (1) of Section 4-A shall be given a serial number in the order of its receipt. The Sub-Divisional Magistrate shall maintain the register in Form 4, in which he shall enter the particulars furnished'in the statement, the gist of his orders, articles delivered by the creditor, articles delivered to the debtor and other particulars specified in the said Form.
APPENDIX 1 FORM
FORM 1
[See Rule 3]
Name of the
Creditor:..........
Licence No. and
date..........
SI.No. Name of the debtor and his full address Date of advance drawn on pledge Amount advanced Pawn Ticket No. Amount 1 2 3 4 5
Amount outstanding as on21-10-1975 Full description of the articles (weight to be noted in case of jewels) Estimate of the annual income ofthe debtor. Principal Interest Total Descriptions Weight Value 6 7 8 9 10 11 12
Date:
Signature
of the Creditor
Address of the Creditor
APPENDIX 2 Receipt for articles delivered by the creditor
FORM 2
[See
Rule 5(1)]
Receipt for articles delivered by the creditor
Date
Received from..........this day....of... ..Month........year.
........articles described below in pursuance of Order No.......dated..
. .of the sub-divisional Magistrate.........under Section 4-A(2) of the Karnataka Debt Relief Ordinance, 1975.
Seal of the office of the Signature
Sub-divisional
Magistrate
Designation.
APPENDIX 3 Acknowledgement by the Debtor
FORM 3
[See
Rule 5(2)]
Acknowledgement
by the Debtor
I, hereby acknowledge the receipt of the following articles:
(Here specify the description of the articles)
Date:
Signature of
Debtor and his
Witnesses full address.
1.
2.
APPENDIX 4 Register to be maintained by sub-divisional Magistrate
FORM [See Rule 6]
FORM 4
[See
Rule 6]
Register to be maintained by sub-divisional Magistrate.
S1. No.
Name of the Creditor and hisfulladdress
Date of receipt of statement filled by thecreditor under Section 4-A Names of debtors shown in thestatement
Gist of the orders of sub- divisionalMagistrate
Description of the articles delivered
Delivered by the creditor
Delivered to the debtor
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