This order has been issued by the High court, where you financiers are in a position to cease your vehicle if you have not been paying your EMIs and eventually have defaulted on your car loan.
The High Court had to listen to go through 21 hearings of GE Capital Transportation Financial Services Ltd against customers who stopped paying installments and then obtained injunctions from a lower court against the vehicles being seized but without any course of harassment or any assault.
GE was apparently on the verge of closing down its operations in West Bengal after a large number of customers – who had got lorries financed – started defaulting on their payments of their loan. All the defaulters were granted relief by a lower court in the form of injunctions, forbidding GE from repossessing the lorries. Finally, GE counsel Phiroze Edulji moved HC, seeking scrapping of the injunctions.
The HC pointed out that even the Motor Vehicles Act has no law prohibiting repossession of vehicles by financiers in the case of default. Under the law, any possession is considered illegal unless “ripened” into a “settled possession”.
This law has been adhered by all motor companies, but they have taken a precaution where the will ensure that borrowers pay their EMIs on the due dates to avoid any kind of harsh measures be imposed on them.