Section 30 of The National Dairy Development Board Act, 1987
Notwithstanding anything contained in any agreement to the contrary, the Board may, by notice in writing, require any person to which the National Dairy Development Board or the society or the dissolved company has granted any loan or advance, to discharge forthwith in full, its liabilities to the Board,--
- (a)if it appears to the Board that any false or misleading information in any material particular was given in the application for the loan or advance; or
- (b)if the person has failed to comply with the terms of its contract in the matter of the loan or advance; or
- (c)if there is a reasonable apprehension that the person is unable to pay his debts or that proceedings for liquidation may be commenced in respect thereof; or
- (d)if the property pledged, mortgaged, hypothecated or assigned as security for the loan or advance is not insured and kept insured by the person to the satisfaction of the Board (or depreciates in value to such an extent that, in the opinion of the Board, further security to the satisfaction of the Board should be given and such security is not given after demand); or
- (e)if, without due permission, any machinery, plant or other equipment (whether forming part of security or not) is removed from the concerned premises without being replaced; or
- (f)if it appears to the Board that any condition in the loan agreement relating to the supply of goods or implementation of the project is being substantially violated; or
- (g)if, for any other reason, the Board considers it necessary so to do for protecting the interests of the National Dairy Development Board.
Summary
- The Board must issue this demand by sending a written notice to the borrower.
- This power can be used even if the loan agreement specifically says early repayment cannot be demanded.
- Early repayment can be triggered if the borrower gave false information, broke contract terms, or moved machinery without permission.
- The Board can also act if the property used as security for the loan loses value, is uninsured, or if the Board simply feels it is necessary to protect its own interests.
Practical examples
FAQ
1. Can the board demand early loan repayment under Section 30 of the National Dairy Development Board Act?
Yes, Section 30 of the 1987 dairy law allows the board to demand immediate and full repayment of a loan with a written notice. This applies even if there is a contrary agreement.
2. Why would the board ask for early repayment under Section 30 of the NDDB law?
Under Section 30 of the dairy development act, early repayment can be demanded if a borrower gave false information, failed to follow contract terms, or seems unable to pay their debts.
3. Does damaged collateral trigger early repayment in Section 30 of the dairy act?
Yes, Section 30 of the national dairy board legislation says the board can demand repayment if the secured property depreciates in value. It also applies if the borrower fails to keep the property insured.
4. What if a borrower moves equipment under Section 30 of the 1987 dairy legislation?
Section 30 of the NDDB Act states that removing machinery or equipment from the premises without permission and replacement is grounds for demanding full repayment.
Test yourself
Q1.Under Section 30 of The National Dairy Development Board Act, 1987, how must the Board inform a borrower that they need to repay their loan early?
Q2.According to Section 30 of The National Dairy Development Board Act, 1987, what happens if a borrower gave misleading information in their original loan application?
Q3.Under Section 30 of The National Dairy Development Board Act, 1987, can the Board demand early repayment if the loan agreement specifically states that early repayment cannot be demanded?
Q4.Which of the following is a valid reason for the Board to demand early repayment under Section 30 of The National Dairy Development Board Act, 1987?