Amendment status not verified — confirm the current text below against the official source.
Conditions for grant of loan.—(1) No loan shall exceed the prescribed percentage of the value of the assets of the industry to which it is granted and of other property, if any, offered as collateral security without deducting the encumbrances, if any, existing thereon at the time when the application for the loan is made, the value being ascertained by the sanctioning authority in the prescribed manner. (2) No loan shall be granted if the encumbrances on the assets of the industry and on other property offered as collateral security exceed 50 per cent of the value of such assets and collateral securities in the case of an existing industry and thirty-three and one third per cent in the case of a new industry. (3) The authority granting the loan shall, from out of the loan, discharge all encumbrances on the assets of the industry and other property, if any, offered as collateral security existing at the time when the application for the loan is made, and shall secure a first charge on the assets and other property aforesaid. (4) Every loan shall be repayable in instalments within a period not exceeding twenty years after the date of advance of the loan, or where the loan is advanced in instalments, after the date of the advance of the last instalment. 9 (5) In special cases the Government, for reasons to be recorded in writing, may, on the application of the owner of an industry to which such loan has been granted, vary the terms fixed by the order granting the loan. (6) All the insurable assets of the applicant offered as security shall be insured against loss or damage with the State Insurance Department and the policy assigned in favour of the Director of Industries and Commerce.