#THE USURY LAWS REPEAL ACT, 1855 
___________ 

##ARRANGEMENT OF SECTIONS 
________ 

###Preamble. 

###SECTIONS 

2.  Rate of interest to be decreed by Courts. 
3.  Rate of interest upon a judgment or decree. 
4.  Contracts for usufruct of property in lieu of interest. 
5.  Amount of interest to be deposited in certain cases of conditional sales under Bengal 
Regulations. Proviso—.
6.  Rate of interest on future adjustments of accounts.



#THE USURY LAWS REPEAL ACT, 1855 

##ACT NO. 28 OF 1855 [^1]

[19th September, 1855.] 

An Act for the repeal of the Usury Laws. 

Preamble.—WHEREAS it is expedient to repeal the laws now in force relating to usury; It is enacted 

as follows:— 

1. [Repeal of enactments.] Rep. by the Repealing Act, 1870 (14 of 1870). 

2. Rate of interest to be decreed by Courts.—In any suit in which interest is recoverable, the amount 
shall be adjudged or decreed by the Court at the rate (if any) agreed upon by the parties; and if no rate 
shall have been agreed upon, at such rate as the Court shall deem reasonable. 

3. Rate of interest upon a judgment or decree.—Whenever a Court shall direct that a judgment or 
decree shall bear interest, or shall award interest upon a judgment or decree, it may order the interest to be 
calculated at the rate allowed in the judgment or decree upon the principal sum adjudged, or at such other 
rate as the Court shall think fit. 

4. Contracts for usufruct of property in lieu of interest.—A mortgage or other contract for the loan 
of money, by which it is agreed that the use or usufruct of any property shall be allowed in lieu of interest, 
shall be binding upon the parties. 

[^1]. Short title given by the Indian Short Titles Act, 1897 (14 of 1897). 

This Act has been declared to be in force in the whole of India, except former Part B States and the Scheduled Districts, by the 
Laws Local Extent Act, 1874 (15 of 1874), s. 3.

It  has  been  declared,  by  notification  under  s.  3(a)  of  the  Scheduled  Districts  Act,  1874  (14  of  1874),  to  be  in  force  in  the 
following Scheduled Districts, namely:—
West Jalpaiguri, the Western  
Dvars, the Western Hills of  
Darjiling, the DarjilingTarai 
and the Damson Sub-division of 
The Darjiling District.          See Gazette of India,		1881, Pt. I, p. 74.
The District of Hazaribagh. Ditto 					1881, Pt. I, p. 507.
The District of Lohardaga (now  
the Ranchi District,  		see Calcutta Ditto
Gazette, 1899, Pt. I, p. 44).      .Ditto 				1881, Pt. I, p. 508.
The District of Manbhum          .Ditto				1881, Pt. I, p. 509.
Pargana Dhalbhum in the District 
Of Singbhum 				.Ditto 				1881, Pt. I, p. 510. 
The Scheduled portion of the 
Mirzapur District    .     .            Ditto 				1879, Pt. I, p. 383. 
Jaunsar Bawar.     .                    Ditto 				1879, Pt. I, p. 382. 
The District of Lahaul .      .       Ditto 				1886, Pt. I, p. 301.
The Scheduled Districts of the C. P.           Ditto 		1879, Pt. I, p. 771. 
The Scheduled District in Gan- 
jam and Vizagapatam .           .                 Ditto 		1898, Pt. I, p. 870. 
The Districts of Kamrup, 
Naugong, Darrang, Sibsagar, Lak- 
h i m p u r , G o a l p a r a ( e x c l u d i n g    
t h e   E a s t e r n   D v a r s )   a n d   C a c h a r  
( e x c l u d i n g   t h e   N o r t h   C a c h a r  
Hills) .     .   .   .   .. . 				Ditto 		1878, Pt. I, p. 533. 
It has been extended, under s. 5 of the last-mentioned Act, to the following Scheduled Districts, namely :—
Kumaon and Garhwal .       .           See Gazette of India,  1876, Pt. I, p. 606.
The Tarai of the Province of 
Agra (now U. P.).                                      Ditto 		1876, Pt. I, p. 505. 



5. **Amount  of  interest  to  be  deposited  in  certain  cases  of  conditional  sales  under  Bengal Regulations.  Proviso.**
—Whenever,under the [^1]Regulations of the Bengal Code, a deposit may be 
made  of  the  principal  sum  and  interest  due  upon  any  mortgage  or  conditional  sale  of  land 
thereafter to be entered into the amount of interest to be deposited shall be at the rate stipulated 
in  the  contract,  or,  if  no  rate  has  been  stipulated  and  interest  be  payable  under  the  terms  of  the 
contract, at the rate of twelve percentum per annum: 

Provided that, in the latter case, the amount deposited shall be subject to the decision of the Court as to 
the rate at which interest shall be calculated. 

6. **Rate  of  interest  on  future  adjustments  of  accounts.**—Inany case in which an adjustment 
of  accounts  may  become  necessary  between  the  lender  and  the  borrower  of  money  upon  any 
mortgage, conditional sale of landed property, or other contract whatsoever, which may be entered 
into after the passing of this Act, interest shill be calculated at the rate stipulated therein; or, if no 
rate of interest shall have been stipulated and interest be payable under the terms of the contract, 
at such rate as the Court shall deem reasonable. 

7. [Saving  of  prior  transactions.]Rep.  by  the  Repealing  Act,  1870  (14  of1870),  s.  1  and  the 
Schedule Part II. 

8. [Commencement of Act.] Rep. by s. 1 and the Schedule, Part II, ibid. 

9. [Schedule of Repealed Enactments.] Rep. by s. 1 and the Schedule, Part II, ibid. 

________ 

[^1]. See Bengal Reg. 1 of 1798, s. 2. This Regulation is, however, now in force only in the SonthalParganas and with the exception 
of the Parts which relate to interest, the Regulation is also in force in the Punjab.