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Chapter – 4

Chapter – 4

Notification of Election

15. Election : The Commission shall hold elections for members of the Constituent assembly to be held pursuant to this Act on such date as specified by the Government of Nepal in accordance with Sub-article (2) of Article 63 of the Constitution.

16. Notification of Election:

(1) In order to complete the holding of polling for members of the Constituent Assembly on such date as specified by Government of Nepal in accordance with Sub-article (2) of Article 63 of the Constitution, the Commission shall specify the time for polling and issue a notification thereof and publish such notification in the Nepal Gazette.
(2) The Government of Nepal may, taking into consideration the geographical situation, weather and other circumstances as well, specify the single day date or different dates for taking polls for the election in one or more election constituencies and election held as per the election program on the single day date or different dates so specified by the Government of Nepal shall be deemed to have been held simultaneously.

17. Notification of Election Program:

(1) After the publication of the notification of the election pursuant to Section 16, the concerned Returning Officer, in accordance with the program determined by the Commission, shall publish a notification of the election to be held under First Past The Post Electoral System, specifying the date, time and place for the registration of nomination papers of candidates, publication of the list of candidates whose nomination papers have been registered, the filing
of petitions against candidates, scrutiny of nomination papers, publication of the name list of candidates nominated, withdrawal of candidature, publication of the final list of candidates and allotment of election symbols to the candidates.
(2) After the publication of the notification of election pursuant to Section 16, the Commission shall publish the program for submission of the closed list of candidates for the election to be held under the Proportional Electoral System to the Commission, filing of petitions against candidates and publication of the final closed list of candidates as well.

Chapter – 5

Chapter – 5

Candidates and Nomination Papers

18. Qualifications for Candidate: A person shall have the following qualifications to become a candidate for election:
(a) A Nepali citizen,
(b) Completed the age of at least twenty-five years of age,
(c) Not been convicted of a criminal offence involving moral turpitude,
(d) Not holding an office of profit.
Explanation: For the purpose of Clause (d) above, “office of profit” means any position other than a political position to be filled by election or nomination, for which a remuneration or economic benefit is paid out of a Government fund.

19. Disqualification of a Candidate :

(1) Notwithstanding any thing contained elsewhere in this Act, the following persons shall be deemed disqualified to become a candidate in the election:
(a) A person whose name is not enlisted in the Electoral Rolls,
(b) An incumbent office-bearer of the Government of Nepal or any institution owned or controlled by, or receiving grants from the Government of Nepal subject to receiving remuneration,
(c) A person who has not completed two years after serving sentence upon being sentenced pursuant to the prevailing laws relating to election,
(d) A person who has been finally sentenced by a court of law on corruption charges,
(e) A person who has been enlisted in the blacklist pursuant to the prevailing laws upon deliberately defaulting loan of a bank and financial institution,
(f) A person who has loses mental balance,
(g) A person who has held the political appointment and has been shown guilty in the report of the Probe Commission constituted pursuant to the Inquiry Commission Act, 2026 (1969) for loss and damage of lives and properties, abuse of power, authority and position, violation of human rights or misuse of state treasury at the time of Peoples’ Movement held for democracy in 2062 (2006) and 2063 (2006).

20. Computation of age of candidate: While computing the age of a person to become a candidate for the election, he/she must have reached twenty-five years of age by the date of filling nomination paper for First Past The Post Electoral System and submitting the closed list of candidates to the Commission for the Proportional Electoral System.

21. Nomination of a candidate:

(1) A person who is qualified to be a candidate pursuant to the Constitution and this Act, and whose name registered in the Electoral Rolls as a voter of any constituency may be nominated as a candidate for the election to be held pursuant to this Act.
(2) While nominating a candidate for a constituency pursuant to Sub-section
(1), there shall be one proposer and one seconder. Such proposer and seconder shall be voters registered in the Electoral Rolls of the same constituency.
(3) In the case of a candidate set up by a Political Party registered for the purpose of election, such a party shall have to provide a formal letter to him/her and the office bearer of the party authorized to provide such a formal letter shall forward a copy of such a letter to the Returning Officer, as well.
(4) In cases where any person is proposed pursuant to Sub-section (1), he/she shall have to set down his/her consent in the nomination paper and sign it.
(5) A person may be nominated by three nomination papers in maximum for the election of the same election constituency.
(6) Notwithstanding anything contained any elsewhere in this Section, while filing a nomination for the candidate under the Proportional Electoral System, the nomination shall be deemed to have been filed if a Political Party has included the names of the qualified candidates in the closed list of candidates and has submitted such closed list to the Commission. Such list shall contain the places of the Electoral Rolls where the names of each candidate so nominated are registered and the duplicates of their Nepalese citizenship certificates as well as their address.

22. Provision on Office-bearer certifying Nomination Paper:

(1) Any Political Party registered with the Commission for the purpose of election shall have to provide the Commission with the name, surname and post of the Office bearer of the Political Party authorised to provide a formal letter nominating candidates, as well as his/her specimen signature certified by the official designated by the Central Executive Committee of the Political Party, prior to at least seven days from the last date for filing nomination papers.
(2) In cases where a nomination paper is filed without fulfilling the procedures as referred to in Sub-section (1), the candidate of the concerned Political Party shall not be recognized as the candidate of that Political Party.

23. Filing of Nomination Paper:

(1) The Candidate himself/herself or his/her agent or proposer or seconder shall have to deliver the nomination paper of the candidate to the Returning Officer of the concerned constituency.
(2) The concerned Returning Officer shall scrutinise as to whether the nomination paper delivered pursuant to Sub-section (1) fulfils the requirement pursuant to this Act, and if it is found to be due, file the nomination paper and provide a receipt thereof as prescribed to the person delivering the nomination paper.
(3) If any nomination paper which does not contain the names of the proposer or seconder or where the proposer and seconder are duplicated, which is not accompanied by the receipt of deposit as required under this Act or which does not bear the signatures of the proposer or seconder or the person to be candidate or does not fulfill other requirements, the Returning Officer shall have to file the nomination paper after getting corrected the matter not incompliance with the formalities. If one wishes to get the nomination paper filed without correcting such matter not incompliance with the formalities as required to be corrected, the same matter shall have to be mentioned in the nomination paper and a notice thereof shall have to be issued to the person delivering the nomination paper.
(4) After the expiry of the time for filing the nomination, the Returning Officer shall publish a list of candidates whose nomination papers have been filed on the date, at the time and place as specified in the notification of the election program.
(5) Any candidate or his/her agent intending to make an objection to the qualification of any candidate mentioned in the list published pursuant to Sub- section (4) may make an objection before the Returning Officer on the date, at the
time and place specified in the notification of the election program.
(6) Notwithstanding anything contained anywhere else in this Section, the nomination papers of the candidates shall be deemed to have been filed as per the closed list of candidates submitted for the purpose of nominating candidates by the Political Party pursuant to Sub-section (6) of Section 21 for the election to be held under the Proportional Electoral System.

24. Scrutiny of Nomination Paper:

(1) The proposer, seconder or the candidate him/herself or attorney authorized by him/her in writing shall have to be present on the date, at the time and place as specified in the notification of the election program for scrutiny of the nomination papers filed for the election to be held under First Past The Post Electoral System.
(2) The Returning Officer shall scrutinise the nomination papers of all the candidates in the presence of the persons as referred to in Sub-section (1). Provided that, this Sub-section shall not be deemed to be barred from the scrutinising the nomination papers and making decision thereon according to the law even if any proposer, seconder or candidate or his/her attorney required to be so present is not present.
(3) While scrutinising the nomination papers of the candidates pursuant to Sub-section (2), the Returning Officer shall also have to make decision by holding necessary inquiries into objection, if any, made against any candidate pursuant to Sub-section (5) of Section 23. While scrutinising accordingly, if the proposer and seconder are found to be duplicated, the concerned candidate must be given an opportunity to make correction thereof and a nomination paper shall not be invalidated only by virtue of minor error and omission contained in the nomination paper. Explanation: For the purposes of this Sub-section, “minor error and omission” means any technical error or error of letters, numbers or vowel signs relating to the writing or printing or name, surname, address or serial number of a candidate, proposer or the person related with them contained in the Electoral Rolls or nomination paper, which does not cause any substantial difference.
(4) The Returning Officer may, in the following circumstances, postpone the proceedings on scrutiny of the nomination papers as required by this Section.
(a) If any mobbing including other abnormal situation erupts in the place and at the time of scrutiny of nomination papers, or
(b) If there occurs any situation beyond control owing to natural calamity.
(5) If the proceedings on the scrutiny of the nomination papers are postponed under Sub-section (4), the Returning Officer shall specify the time and place for the scrutiny of nomination papers and scrutinise them as soon as possible.

25. Invalidity of nomination paper: A nomination paper shall be invalid under the following circumstances:
(a) If the Candidate does not possess the qualifications as referred to in the Constitution and this Act,
(b) If there does not exist the consent of the candidate or the nomination paper does not bear his/her signatures or the signature of the proposer and seconder nominating him/her as a candidate or contains forged signature,
(c) If the deposit required to be furnished pursuant to Section 67 is not furnished,
(d) If the nomination paper is not filed within the time pursuant to Section 17,
(e) If the nomination paper is not filed as referred to in Section 22 and 23,
(f) If other requirement as referred to in the Act are not fulfilled.

26. Name list of candidates: After the nomination papers have been scrutinised, the Returning Officer shall have to prepare a name list of the candidates as referred to in the nomination papers meeting the requirements as per the law in the prescribed manner and publish a copy of the name list at his/her office. Provided that, the Commission shall make public the name list of the closed list of candidates submitted by the Political Parties for election under the Proportional Electoral System.

27. Withdrawal of names:

(1) If any candidate wishes to withdraw his/her name in order to get his/her name removed from the list of candidates, such a candidate may withdraw his/her name by giving a notice in writing to the Returning Officer within the time specified pursuant to Sub-section(1) of Section 17.
(2) The notice of withdrawing name pursuant to Sub-section (1) shall have to be submitted by the candidate him/herself or his/her representative.
(3) After the notice of withdrawing name pursuant to Sub-section (1) has been submitted to the Returning Officer, the notice shall not be allowed to be cancelled or withdrawn.
(4) The Returning Officer shall, if he/she is satisfied with the genuineness of the notice submitted pursuant to Sub-section (1), remove the name of the candidate withdrawing his/her name from the name list of candidates, and immediately publish a notice of the name removal at his/her office.
(5) If the authorized person of any Political Party so writes to the Returning Officer as to withdraw the name of any ♣ candidate set up by within the time limit specified pursuant to Sub-section (1) of Section 17, he/she shall not be retained as a candidate of that party.
(6) If a candidate enlisted in the closed list of candidates wishes to remove his/her name from the closed list of candidates within the time as specified pursuant to Sub-section (1) of Section 17, an application shall have to be filed
before the Commission. When such an application is filed, the Commission shall remove the name of such candidate from the closed list of candidates and the same must be notified to the concerned Political Party.

28. Final name list of candidates:

(1) After the expiry of the time specified for the withdrawal of names by the candidates pursuant to Sub-section (1) of Section 17, the Returning Officer shall have to prepare a final name list of the remaining candidates in such a manner as may be prescribed and immediately publish a copy of the name list at his/her office. A copy of the name list shall have to be forwarded to the Commission, as well, immediately.
(2) The names of the candidates shall be arranged in an alphabetical order in the name list as referred to in Sub-section (1), and in the case of a candidate nominated by any Political Party, the name of that party shall also be mentioned in the address as mentioned in their nomination papers

29. Provision regarding objection to the candidates under the Proportional Electoral System:

(1) The Commission shall have to make necessary scrutiny of the closed list of the candidates received pursuant to Section 7 and make it public.
(2) While publishing the closed list of candidates pursuant to Sub-section
(1), a notice must be published inviting to make objection thereto along with an application within seven days, if any candidate whose name is enlisted in such list does not possess qualification as referred to in the constitution and this Act,
(3) The Commission may publish and broadcast the closed list of candidates as well as the contents publishing a notice inviting objection thereto pursuant to Sub-section (1) and (2) at the national level media as and when so required.
(4) Any Political Party or any candidate having his/her name on the closed list, may raise an objection with evidence to the Commission within the specified time, indicating that the candidate of the closed list of the candidates is not qualified in accordance with the Constitution and this Act pursuant to Subsection (1).
(5) When an application of objection is received pursuant to Sub-section
(1), the Commission may make a necessary scrutiny and if the person of the closed list of candidates is not found to possess the qualifications as referred to in the Constitution and this Act, the Commission, shall remove such a name from the list setting out the same contents.
(6) After the completion of all the procedures regarding the raising of objection the Commission shall publish a final closed list of candidates at its office.
(7) After the completion of all the procedures regarding the raising of objections the Commission shall have to certify the final closed list of candidates and send it to the concerned Political Party.

30. Unopposed Election : If there remains only one candidate in any constituency under the First Past The Post Electoral System, the Returning Officer shall declare, as prescribed, that the candidate has been elected unopposed.

31. Election Symbols :

(1) The Commission shall specify the election symbols to be allotted to the candidates and the Political Parties for the election to be held under First Past The Post Electoral System and the Proportional Electoral System respectively.
(2) The election symbol specified pursuant to Sub-section (1) shall be allotted to the Political Party and candidate as prescribed.
(3) While allotting election symbol pursuant to Sub-section (2), the Commission shall so allot the symbol of the same kind to every Political Party registered under this Act as to be used by the candidate set up by it in any election
constituency for the election under the First Past The Post Electoral System and to be used by that Political Party for the election under the Proportional Electoral System.
(4) No person other than the candidate of that Political Party or the Political Party itself shall be entitled to use the election symbol allotted pursuant to Sub- section (3).
(5) Once a candidate has received an election symbol, the election symbol shall not be subject to alteration even if he/she abandons that Political Party or joins another party. If such a candidate is elected and if the Political Party providing such election symbol files a complaint accompanied by evidence, his/her membership shall be cancelled.
(6) While allotting election symbol pursuant to this Section, the election symbol received from the Commission for the purpose of election prior to commencement of this Act by a Political Party representing to Legislature- Parliament at the commencement of this Act must be allotted to that Political Party. If the Commission thinks that any mistake or inconsistency has occurred in the allotment of the election symbol as specified in this Section, the
Commission may alter such symbols.
(7) The Returning Officer shall allot, in such a manner as may be prescribed, an election symbol specified to be used by an independent candidate out of the group of election symbols set aside for the use of independent candidates.

32. Death of Candidate :

(1) If any candidate, set up by any Political Party whose nomination paper has already been held to be due and who has not withdrawn his/her name list, dies prior to the publication of the final name list of candidates pursuant to Section 28, and a written notice of such a death is received from the concerned candidate’s election agent or the concerned Political Party, the Returning Officer shall have to immediately postpone other program scheduled for that constituency and give information of the event to the Commission. The Returning Officer shall have to affix at his/her office a notice of such postponement of the program for information of the other candidates, as well.
Provided that, the election program shall not be postponed in the event of death of any candidate included in the closed list of candidates for proportional election.
(2) If after publication of the final name list of candidates pursuant to Section 28, any candidate nominated by a Political Party dies and a written notice of such death is received from the concerned candidate’s election agent or the concerned Political Party, the Returning Officer shall have to immediately postpone other program scheduled for that election constituency and inform the event of death to the Commission. The Returning Officer shall have to affix at his/her office a notice of such postponement of the program for information of other candidates, as well. Provided that, the election program shall not be postponed in the event of death of any candidate included in the closed list of candidates for proportional election.
(3) Upon receipt of information as referred to in Sub-section (1), the Commission shall have to so determine other program that it has no real impact on the polling program in that constituency, and that the program relating to the nomination of candidates can be completed as early as possible, and send the program to the Returning Officer. While determining the program in this way, the program shall have to be determined in such a way that the party whose candidate dies can only re-nominate another candidate.
(4) Upon receipt of information as referred to in Sub-section (2), the Commission shall re-determine other program as referred to in this Chapter for election including the date for polling in that constituency and send the program to
the Returning Officer.
(5) Candidate whose name is mentioned in the final name list of candidates published pursuant to Section 28 shall not be required to re-file a nomination paper, and the Political Party whose candidate died may only re-file a nomination paper on its behalf.
(6) Notwithstanding anything contained elsewhere in this Section, when election is to be postponed because of the death of a candidate, if the duration required to complete the activities as prescribed in election program remains more than fifteen days, it shall not be required to publish another program. Adjustments shall have to be made to complete the filling of the candidate’s nomination paper within the period as per the said program without causing any real impact on the polling

33. Identity card of candidate: The Returning Officer shall provide the identity cards, as prescribed, to the candidatesunder First Past The Post Electoral System, remained on the final name list pursuant to this Chapter.

Chapter – 6

Chapter – 6

Polling Station, Ballot Paper and Ballot Box

34. Polling station:

(1) The Commission shall specify the polling stations and sub- stations in the required number within the constituency and shall publish a list thereof in the manner as prescribed.
(2) The basis, process and other provisions of specifying polling stations shall be as prescribed.
(3) The Returning Officer may, if required, add to, and decrease the number of polling stations or transfer polling stations to a place that is more appropriate from the viewpoint of convenience or practicality, with the prior approval of the Commission.
(4) There may be more than one polling station or sub-station or polling compartment within the area of one polling station.

35. Ballot Paper :

(1) The Commission shall have to make arrangements of separate ballot papers in separate colours in such format as specified ……. ∝ for the election to be held under First Past The Post Electoral System and the Proportional Electoral System……… ∝
(2) Other provision regarding ballot papers shall be as specified by the Commission.

36. Ballot box: The Commission shall have to make arrangement for separate ballot boxes to be used for the polling in the elections to be held under the First Past The Post Electoral System and Proportional Electoral System

Chapter – 7

Chapter – 7

Polling

37. Time for Polling : The time for polling on the polling date shall be as specified in the notification as referred to in 23

38. Polling :

(1) A voter, whose name is registered in the Electoral Rolls of any ward of a Village Development Committee or Municipality of any constituency, shall be entitled to vote in the same ward of the same Village Development Committee or Municipality of that constituency. Provided that, this restriction shall not be applicable to the Provisional Voters.
(2) A voter shall be entitled to cast vote only at the polling station assigned to him/her in accordance with the Electoral Rolls.
(3) A voter shall first obtain the ballot paper for the First Past The Post Electoral System at the polling station assigned to him/her and cast his/her vote in the ballot box kept therefor and thereafter he/she shall obtain the ballot paper for the Proportional Electoral System and cast vote in the ballot box kept therefor. Provided that, a provisional voter may cast his/her vote only for the election under the Proportional Electoral System, as prescribed.
(4) No one other than a voter shall cast vote in the name of the voter whose name is registered in the Electoral Rolls.
(5) No one who is not qualified to cast vote pursuant to this Act shall cast vote.
(6) No voter shall vote at the same election in more than one constituency or at more than one polling station of the same constituency.
(7) No voter shall vote more than once in any constituency other than the elections under the First Past The Post Electoral System and Proportional Electoral System.

39. Polling Method:

(1) The Polling Officer shall give prescribed ballot paper to the voter present at the polling station for voting by fulfilling the procedure as prescribed.
(2) Before giving the ballot paper to a voter, the Polling Officer shall enter the matter as prescribed in the Electoral Rolls and give the ballot paper as prescribed.
(3) The voter shall have to vote by marking in the ballot paper with such seal or sign as prescribed in a secret manner.
(4) The voter shall vote for the First Past The Post Electoral System by marking the seal or sign in the ballot paper’s box contenting the election symbol of any one candidate whom he/she choose and for the Proportional Electoral System in the box of the ballot paper’s box containing the election symbol or sign of any one Political Party whom he/she chooses as referred to in Sub-section (3) and drop the ballot papers into the designated ballot box.
(5) Notwithstanding any thing contained elsewhere in this Act where electronic device are used for polling purposes, the voter shall have to cast vote through electronic device as prescribed.

40. Power to postpone polling in special circumstances:

(1) Where the Polling Officer appointed to a polling station or the Returning Officer of that constituency is satisfied that the act of polling cannot be conducted owing to any commotion as well as other extra-ordinary situation at the polling station or owing to non operation of electronic device or any riot or natural calamity or any force majeure, he/she may postpone the polling at that polling station immediately and publish a notice thereof at that place. Where the Polling Officer has postponed the polling, he/she shall give a notice thereof to the Returning Officer immediately.
(2) The Returning Officer should give information of the postponement of polling pursuant to Sub-section (1) to the Commission immediately and to other concerned authorities, as well.
(3) Upon receipt of the information pursuant to Sub-section (1), except as otherwise directed by the Commission, the Returning Officer publish a notice indicating the date and time for re-polling in that polling station and conduct such re-polling.

41. Unauthorized seizure of polling station:

(1) A polling station shall be considered seized in the following circumstances:
(a) If any one, by using force or coercion, or showing intimidation or giving threat, takes control over the polling station or the voting compartment (or place fixed for voting) or electronic device and affects the polling or allows
only the voters supporting any candidate to vote or prevents other voters
from voting,
(b) If any one, with or without using force, shows threat or fear to the voters to or not to vote for any candidate or prevents the voters from going to or entering into the polling station for polling,
(c) If any one, with or without using force, prevents the employees involved in the act of polling from discharging their duty, or snatches the ballot papers, ballot boxes, electronic device for voting or other election materials or so
affects that the polling cannot be held in an impartial and free manner by doing similar other acts.
(2) Where any event as referred to in sub-section (1) occurs, the Polling Officer shall give a report thereof, accompanied by his /her opinion, to the Returning Officer, and the Returning Officer shall give such report to the
Commission immediately.
(3) On receipt of the report as referred to in sub-section (2), the Commission may depute a Monitoring Team to make inquiry in that place; and the Commission may, based on the report given by the Monitoring Team, if any, so deputed and other state of affairs, as well, cancel the polling of that polling station. The Returning Officer should, as directed by the Commission, specify the date and time for conducting re-polling at the polling station where polling has been so canceled.
(4) Where it appears from the report as referred to in Sub-section (2) and other state of affairs that the unauthorized seizure of the polling stations could affect the results of election, the Commission may cancel the election of that
constituency; and the Returning Officer may specify the date and time for re- polling.

42. In case of damage or destroy of ballot box and electronic device :

(1) Where any ballot box used for polling or electronic device installed at the polling station is lost accidentally or knowingly destroyed, the Polling Officer shall have to give a report thereof to the Returning Officer of the election constituency where the polling station is located immediately and the Returning Officer shall have to give a report thereof to the Commission.
(2) Where any ballot box used or electronic device for polling and already handed over by the Polling Officer to the Returning Officer is snatched in any way or lost accidentally or is knowingly destroyed, the Returning Officer shall give a report thereof, accompanied by his/her opinion on the event, to the Commission immediately.
(3) The Commission upon receipt of the report along with the opinion as referred to in Sub-section (1) or (2), depute a Monitoring Team to investigate all the related incidents and circumstances, also upon studying the report of the Monitoring Team, if so deputed, cancel the polling of that polling station.
(4) The Concerned Returning Officer shall, at the direction of the Commission, specify the date and time for re-polling at the polling station where the polling has been cancelled pursuant to Sub-section (3) and publish a notice thereof.

43. Objection to impersonation of a voter :

(1) If any person falsely impersonating any other voter presents himself/herself to receive a ballot paper to vote, a Political Party or candidate or their agent may register an objection with the Polling Officer in such a manner and along with a deposit of such sum as may be prescribed.
(2) If an objection is made pursuant to Sub-section (1), the Polling Officer shall make a summary investigation and decide immediately and shall forthwith record the objection so made and the decision thereof in such a minute book as may be prescribed.
(3) If the objection as referred to in Sub-section (1) is held to be correct, the Polling Officer shall return the sum of the deposit to the concerned person. If the objection is not held to be correct, the sum of the deposit shall be forfeited.

44. Admission to polling station:

(1) The Polling Officer shall not allow other persons except the following persons to enter into the polling station:
(a) Voters,
(b) Agent of a Political Party or a candidate or one of his/her agent,
(c) Observers permitted by the Commission,
(d) Persons permitted by the Commission or Returning Officer or Polling Officer,
(2) No voters other than those who have already entered into the polling station shall be entitled to enter into the polling station after the expiry of the time for polling.

45. Inspection by Polling Officer: If a voter stays in the voting compartment for more than reasonable time or the Polling Officer has any suspicion, he/she may enter into the voting compartment and inspect there.

46. Disabled Voters:

(1) If any voter being unable to vote by him/herself owing to physical disability or any other reason requests for permission to be accompanied by any person whom he/she trusts and the Polling Officer shall, if he/she considers it to be reasonable, allow such a person accompanied by the voter to enter into the voting compartment.
(2) If any voter being unable to vote by him/herself requests the Polling Officer to mark his/her vote in the box containing the symbol of his/her choice on the ballot paper or requests the Polling Officer for permission to be accompanied by another person to mark his/her vote in the box containing the symbol of his/her choice, arrangements shall have to be made so that the Polling Officer or the person whom the voter has with his/her free will and consent, chosen on his/her behalf, shall assist the voter in marking the vote.
(3) Notwithstanding anything contained elsewhere in this Act, the Commission may make special arrangement for voting by the blind, disabled, elderly persons, pregnant women and other voters suffering from other similar physical infirmities.

Chapter – 8

Chapter – 8

Counting of Votes and Election Results

47. Returning Officer to carry out, or cause to be carried the counting of votes: The Returning Officer shall carry out, or cause to be carried the act of counting of votes of his/her election constituency under his/her direct supervision and control.

48. Notice of counting of votes: After receiving from the Polling Officers all the ballot boxes used for polling at all the polling stations in the constituency, the Returning Officer shall publish a notice specifying the place, date and time for counting of votes for information of the Political Parties and candidates. While specifying the time for counting of votes, the time shall be specified as far as possible in such a manner that the counting of votes of both the electoral system shall coincide and if it is impossible to so carry out the counting of votes simultaneously the priority shall be given for counting of votes under the First Past The Post Electoral System.

49. Counting of votes:

(1) The Returning Officer, as far as possible, shall have to commence the act of counting of votes under both Electoral System simultaneously at the place, date and time as referred to in the notice under Section 48 and if it is not possible to commence the act of counting of votes simultaneously, the Returning Officer shall have to commence first the act of counting of votes of the election under the First Past The Post Electoral System as prescribed and after completion of such counting of votes , the Returning Officer shall have to carry out the act of counting of votes secured by the Political Parties in the election under the Proportional Electoral System.
(2) The Political Parties, candidates or their agents and necessary counting agents may appear at the place, time and on the date for the counting of votes as referred to in Sub-section (1).
(3) If re-polling is to be held at any polling station of any constituency pursuant to this Act, the counting of votes of other polling stations of that election constituency shall not be commenced until the completion of the polling at that
polling station.

50. Entry into the place for counting of votes:

(1) The Returning Officer may allow representatives of the Political Parties or candidates or their election agents and counting agents, the person deputed in the counting of votes, persons deputed for observation and monitoring, employees deputed for security, and the person deputed by the Commission to enter into the place for counting of the votes.
(2) The Returning Officer may order any person who causes obstruction in the act of counting of votes to go out from the place of counting of votes, and the person receiving such an order shall have to go out of the place for counting of votes. The employees deputed for security in that place shall, by the order of the Returning Officer, expel from that place the person who does not carry out that order and becomes self-willed.

51. Counting of votes to be continuous :

(1) Once the counting of votes is commenced, the Returning Officer shall keep on the act of counting of votes continued until the completion of the counting of votes.
(2) If, owing to any circumstances of force majeure , the act of counting of votes has to be adjourned in the meantime, the Returning Officer shall prepare an inventory of the ballot papers already counted, documents relating to the counting of votes, ballot papers remain to be counted, and the ballot boxes of which ballot papers have not been counted, and keep them in different envelops, bags or sacks and seal them with his/her own seal. The Political Parties or candidates or their vote counting agents or election agents, as well may, if they so wish, also put their own seal on the envelopes, bags or sacks.
(3) The act of counting of votes adjourned pursuant to Sub-section (2) shall have to be resumed as soon as possible. A notice on the resumption of the counting of votes pursuant to this Sub-section shall have to be given to the Political Parties or candidates or their election agents or counting agents present in that place and be published also in the place for counting of votes. Provided that, the counting of votes shall not be barred for the reason that the Political Parties or candidates or their agents are not present.

52. Loss of ballot papers prior to completion of the counting of votes:

(1) If, prior to the completion of the counting of votes, the ballot papers and ballot boxes containing the ballot papers used at any polling station or the electronic device kept for polling are taken elsewhere out of the custody of the Returning Officer in an illegal manner or opened or destroyed or deliberately broken or lost or damaged accidentally, the Returning Officer shall adjourn the act of counting of votes, and give a report thereof to the Commission immediately .
(2) After the counting of votes has been adjourned pursuant to subsection
(1), the Commission shall declare the whole polling of such polling station to be illegal; and the Returning Officer shall, at the direction of the Commission, publish a notice specifying the place, date and time for re-polling at such polling station.

53. Unlawful seizure of place for counting of votes:

(1) The place for counting of votes shall be deemed to have been unlawfully seized in the following
circumstance:
(a) If any one by using force or coercion, or showing intimidation or giving threat, seizes the place for counting of votes or seizes the ballot papers or ballot boxes containing such ballot papers or electronic device kept for voting from the custody of any official or employee engaged in the counting of votes or interferes with, or affects, the counting of votes by committing similar other acts, or
(b) If any person engaged in the counting of votes commits the act as referred to in Clause (a) or aids to or acquiesces in the commission of such act.
(2) Where the place for counting of votes is seized unlawfully pursuant to Sub-section (1), the Returning Officer shall immediately adjourn the counting of votes and give a report thereof to the Commission immediately.
(3) Upon receipt of the report as referred to in Sub-section (2), if the Commission may, if it deems necessary to hold inquiries into the incident, depute a Commissioner of the Commission, or a Monitoring Team, to hold inquiries there into.
(4) If, on the basis of the report as referred to in Sub-section (2), or of the report of the Commissioner or the Monitoring Team deputed to hold inquiries pursuant to Sub-section (3), the Commission holds that the place for counting of votes was unlawfully seized as referred to in Sub-section (1), it may declare invalid all the ballot papers of the polling station affected from that seizure and cancel the polling.
(5) The Returning Officer shall publish a notice specifying the place, date and time for re-polling at the concerned polling station in respect whereof the polling have been cancelled by the Commission pursuant to Sub-section (4).

54. Invalidity of ballot papers : A ballot paper shall be invalid in the following circumstances:
(a) If it does not bear the signature of the concerned Polling Officer,
(b) If the mark indicating the vote is not placed as prescribed but marked with any other manner or it bears any other symbol,
(c) If the mark indicating the vote is so used that cannot be identified,
(d) If it bears the mark indicating vote elsewhere than in a box containing the symbol of the candidate or Political Party,
(e) If it has been returned to the Polling Officer with the intention of abstaining from voting,
(f) If the mark indicating the vote is so placed that it is not clear to signify definitely as to which candidate or Political Party the vote has been given for,
(g) If the mark indicating the vote is placed in the boxes of more than one box in a manner that it cannot be ascertained as to which candidate the vote was given,
(h) If the vote is cast with a ballot paper other than the ballot paper specified for the concerned polling station,
(i) If the ballot paper other than that issued by the Commission are used, and
(j) If the ballot paper specified for the concerned constituency has been used for another constituency.

55. Recounting of votes :

(1) A representative of any Political Party with regard to counting of votes of election held under the Proportional Electoral System and any candidate of the concerned constituency or his/her election agent or counting agent with regard to counting of votes of election held under the First Past The Post may, before the completion of the counting of votes or prior to sealing the counted ballot papers, make an application in writing setting out the reason there for to the Returning Officer forthwith for recounting of any or all the ballot papers.
(2) If an application is made pursuant to Sub-section (1), the Returning Officer shall immediately register the application and may recount the votes if it seems necessary to recount the votes.
(3) If it is not necessary to recount the votes pursuant to Sub-section (2), the Returning Officer shall make a decision accordingly and give a notice of the decision to such candidate, his/her election agent, or counting agent so present at that place prior to the declaration of the election result.

56. In case of tie : If, after the completion of the counting of votes of the election under the First Past The Post Electoral System, two or more candidates receive equal number of votes, the Returning Officer shall decide by drawing lots amongst the candidates receiving equal number of votes.

57. Publication of the result of the First Past The Post Electoral System:

(1) After the completion of the act of counting of votes of all the polling stations polled in any constituency under the First Past The Post Electoral System, the Returning Officer shall prepare a chart of counting of votes as prescribed and publish the election results as prescribed and shall have to forthwith send a copy of the result chart to the Commission.
(2) While publishing the results of the election pursuant to Sub-section (1), the Returning Officer shall have to declare the candidate receiving the highest number of valid votes as elected and award the certificate to him/her indicating his/her election as prescribed.
(3) After the publication of the results of the election, the Returning Officer shall prepare his/her report including the details relating to the election as prescribed and send it to the Commission as soon as possible.
(4) Upon receipt of the chart of the results of election pursuant to Sub- section (1), the Commission shall prepare a name list of the elected members and send copy of that name list of the candidates elected accordingly to the Prime
Minister and the Legislature-Parliament and the Commission shall also publish the name list in the Nepal Gazette.

58. Declaration of the result of the proportional election results:

(1) The Returning Officer shall have to count the votes cast for the election under the Proportional Electoral System and forthwith send the total number of valid votes secured by each Political Party to the Commission by setting out in a chart as prescribed.
(2)After receiving the report of total number of valid votes secured by the Political Parties through out the country in the election under the Proportional Electoral System upon considering the entire county as a single constituency, the Commission shall declare elected the candidates presented to the Commission upon selecting by the Central Executive Committee of each Political Party pursuant to Sub-section (6) of Section 7 from amongst the candidates enlisted in the closed list of candidates submitted by the Political Party to the Commission in proportion to the votes secured by that Political Party. The Commission shall send the name list of the candidates so elected to the Prime Minister and to the Legislature-Parliament and also publish the said name list in the Nepal Gazette.
(3) For the purpose of determining the number of seats to be won by a Political Party in proportion to the total valid votes secured by that Political Party in the election held under the Proportional Electoral System, the Commission shall apply the Results Divisor Method as mentioned in Schedule-5 and decide the number of seats to be won by that Political Party accordingly.
(4) If more than one Political Party are found secured an equal number of votes with regard to any seat while distributing number of seats to be won by the parties upon dividing total valid votes secured by the Political Parties as per the Result Divisor Method as referred to in Sub-section (3), the issue as to which Political Party shall win such a seat shall be decided by lots.

59. Date of Election (1) With regard to the election held under the First Past The Post Electoral System, the date of declaration of the results of election by the Returning Officer pursuant to Section 57 shall be deemed to be the date on which the concerned candidate has been elected.
(2) With regard to the election held under the Proportional Electoral System, the date of the declaration of the candidate of the Political Parties elected from the closed list of candidates by the Commission pursuant to Section 58 shall be deemed to be the date on which the concerned candidate has been elected.

Chapter – 9

Chapter – 9

Agents of Candidate

60. Election agent:

(1) If any candidate appoints a person as an election agent, the notice thereof shall have to be given in writing to the Returning Officer.
(2) The Political Party may appoint its election agent as prescribed for all the activities of election under the Proportional Electoral System.
(3) The candidate or Political Party may, at any time remove the election agent appointed pursuant to Sub-section (1) and (2) and appoint another agent and shall have to give a notice thereof to the Returning Officer immediately.
(4) The qualification of the election agent shall be as prescribed.

61. Duty of election agent : It shall be the duty of the election agent appointed pursuant to Section 60 to perform such functions as mentioned in this Act and the Rules framed under this Act to be performed by the election agent.

62. Polling agent and counting agent :

(1) A candidate or his/her election agent, a Political Party or its agent may appoint polling agent in such number as prescribed for each polling station and shall have to give a notice thereof in writing to the Polling Officer and the Returning Officer.
(2) A candidate or his/her election agent or a Political Party or its agent may appoint counting agents in such a number as prescribed to be present at the place of counting of votes and shall have to give a notice thereof in writing to the Returning Officer.
(3) Any candidate or election agent may at any time remove the polling agent or counting agent appointed pursuant to sub-section (1) or (2) and appoint another polling agent or counting agent, and shall have to forthwith give a notice thereof to the Polling Officer in the case of appointment of polling agent and to the Returning Officer in the case of appointment of counting agent.
(4) The qualification of the polling agent and the counting agent shall be as prescribed.

63. Duty of the polling agent and the counting agent:

(1) It shall be the duty of the polling agent to perform all functions required to be performed by him/her at the polling station pursuant to this Act and the Rules framed under this Act.
(2) It shall be the duty of the counting agent to perform all the functions required to be performed by him/her pursuant to this Act and the Rules framed under this Act.

64. Absence of candidate or any agent: If an election agent or polling agent or counting agent is not appointed pursuant to this Act and the Rules framed under this Act, or the candidate or any of his/her agent is not present as and when required, or any of them fails to perform such functions as are required to be performed, the act of polling or counting of votes shall not be adjourned and such act shall not be deemed to be invalid merely on that ground

Chapter – 10

Chapter – 10

Miscellaneous

65. Bye-election: If a post of Member of the Constituent Assembly elected under the First Past The Post Electoral System falls vacant at the time when the term of office of the Constituent Assembly shall remain valid for a period more than six months, the Commission shall fulfill such vacant post through bye-election.

66. Provision for tendered ballot papers :

(1) If anyone has, by impersonation, already obtained the ballot paper or voted in the name of another voter, and the person who has come afterwards to vote, is found, from the evidence submitted by him/her, to be the real voter, the Polling Officer shall give a tendered ballot paper to such a voter. Where such tendered ballot paper is given, after the voter has indicated his/her vote on the ballot paper, such a ballot paper shall not be inserted into the ballot box but shall be placed in a separate envelope kept for that purpose.
(2) The procedures for giving and placing of the tendered ballot paper pursuant to Sub-section (1) and other procedures pertaining thereto shall be as prescribed.
(3) While counting the votes pursuant to the provisions of this Act, the tendered ballot papers placed in a separate envelope pursuant to Sub-section (1) shall not be counted at that time. If a petition relating to the election is filed and the court holds that the tendered ballot papers are necessary to settle the petition, the court may also count such tendered ballot papers.

67. Deposit to be furnished:

(1) To be a candidate under First Past The Post Electoral System from any election constituency, a sum of three thousand Rupees shall have to be deposited, and a Political Party submitting a closed list of the candidates before the Commission for an election under the Proportional Electoral System shall have to deposit a sum of ten thousand Rupees.
(2) If more than one nomination paper is filed for one candidate in one election constituency for election under First Past The Post Electoral System, it shall be sufficient to furnish the deposit for one nomination only.
(3) While filing a nomination paper for a candidacy of the election under First Past The Post Electoral System, the nomination paper submitted to the Office of the Returning Officer must include the cash or bank receipt of the cash deposit. When a Political Party submits a closed list of the candidates before the Commission for the election under the Proportional Electoral System, the closed list must be accompanied by a receipt of a cash deposit or bank receipt in favour of the Commission.

68. Forfeiture of Deposits:

(1) The deposit of the candidate who receives less than ten per cent of the total valid votes cast in any election under First Past The Post Electoral System shall be forfeited. Provided that, in the case of the elected candidate, this provision shall not be applicable.
(2) If any Political Party fails to win at least one seat from the total valid votes cast in the election under the Proportional Electoral System, the deposit furnished by such Political Party shall be forfeited.
(3) Except where the deposits are liable to be forfeited pursuant to sub- section (1) or (2), the candidates and persons whose nomination papers have been rejected or who have withdrawn their names, shall get back their deposit within
three months after the declaration of election results.
(4) If the deposit is not withdrawn within the time frame as referred to in Sub-section (3), the sum of deposit shall be credited to the Consolidated Fund.

69. Election expenses :

(1) The ceiling of the amount allowed to be expended by the candidate in the election under First Past The Post Electoral System and by the Political Party in the election under the Proportional Electoral System shall be as prescribed by the Commission upon a notification published in the Nepal Gazette.
(2) A Political Party, a candidate, or its/his/her election agent shall have to maintain the records of all expenses incurred in the election during the period of election in such a format as may be prescribed. Explanation: For the purposes of this Section, “period of election” means the period beginning from the date of filing of the nomination paper of the candidates for the First Past The Post Electoral System or from the date of the filing of the closed list of candidates for the Proportional Electoral System to the date of declaration of the election results.
(3) The total expenditure incurred by any Political Party or candidate in the election shall not exceed the ceiling of expenses as prescribed in Sub-section (1).
(4) In the case of the Proportional Electoral System, the statement of election expenses as referred to in sub-section (2) shall have to be given to the Commission by the Political Party within thirty five days after the declaration of the election results and the expenses incurred in the case of the candidates of the election under the First Past The Post Electoral System the same shall have to be given to the District Election Office by the candidates or their agents within thirty five days after the declaration of election results. The District Election Office shall have to forward the statement of expenses so received to the Commission.

70. Secrecy of documents related to election :

(1) Out of the documents used in the election, those required for the purpose of the counting of the votes shall be opened and looked into and sealed after the completion of the counting of the votes and, thereby, shall be kept in custody of the District Election Officer.
(2) The sealed envelopes, bags or sacks containing the counterfoils of the ballot papers sealed pursuant to Sub section (1), the Electoral Rolls used in the polling, and the valid and invalid ballot papers may be opened and looked into only by the Court in connection with the petition filed pursuant to the prevailing laws.
(3) After they have been opened and looked into by the order of the Court pursuant to Sub-section (2), the Court shall seal and restore them in their original form. No official or body other than the Court shall have the authority to open and look into such sealed envelopes, bags or sacks.
(4) The documents mentioned in this Section shall be preserved for three months from the date of the final settlement of the case, if any filed, and from the date of the expiry of limitation for filing a petition if no case has been filed.

71. Prohibition on divulgence of secrecy:

(1) Except as authorized by the law, any employee deputed in performing the act relating to election or candidate or election agent or polling agent or counting agent or any other person shall not divulge to any person, write or disclose in any manner, the vote marked by the voter in the ballot paper or any other matter pertaining thereto known to him/her or which he/she comes to know.
(2) Notwithstanding anything contained in this Act or other prevailing laws, no witness or person shall be asked in the course of legal proceeding instituted under this Act any question as to whom he/she has voted for election or who has voted for whom.

72. Power to issue orders and give directives :

(1) In addition to the matters contained in this Act and the Rules framed under this Act, the Commission may issue necessary orders in regards to the elections and the Commission shall publish such orders in the Nepal Gazette.
(2)The Commission may issue necessary directives to the employees deputed in the act of election for the conduct of the election.
(3) It shall be the duty of all including the Government of Nepal, governmental offices and bodies, governmental, semi governmental and non- governmental organizations and bodies, Political Parties, candidates and their agents, as well as person carrying out election canvassing and the employees deputed in the act of election to abide by the orders and directives issued by the Commission pursuant to this Section.

73. Power to seek assistance:

(1) The Returning Officer, the Polling Officer or Monitoring Team, Observer or any official deputed by the Commission in the act of election may, in the course of the act of election, seek assistance from any governmental body or body relating to security including the police at the local level.
(2) If assistance is so sought pursuant to Sub-section (1), it shall be the duty of the concerned police as well as government and security related body to render the necessary assistance.

74. Power to frame Rules: The Commission may frame necessary Rules in order to carry out the objectives of this Act.

75. Power to formulate and enforce directives: The Commission may formulate and enforce necessary manuals to implement the objectives of this Act subject to this Act and the Rules framed under this Act.

75A. Power to make procedure : the commission may make necessary procedure for implementation of this act or Rule made thereunder this Act and such procedure shall come into force .

76. Power to remove difficulties: If any difficultly arises in connection with the implementation of this Act and Rules, manuals and orders issued under this Act, the Commission may issue necessary orders to remove such difficulty.

Preamble

An Act made to provide for levying court fees

Preamble: Whereas, the Nepal law on the provision of court fees previously existing has applied only to the Kathmandu Valley is not adequate and it is expedient to apply it also to other areas of …………..Nepal1 , in order to maintain order for the public interest and maintain the convenience of the citizens of ……………Nepal2 ; Now, therefore, be it enacted and enforced by the Parliament in the Sixth year of reign of His Majesty King Mahendra Bir Bikram Shah Dev.

Chapter-1 Preliminary

Chapter-1 Preliminary

1. Short title, extension and commencement:

(1) This Act may be called as the “Nepal Court Fees Act, 2017 (1960)”. (2) This Act shall extend throughout ………Nepal3 . (3) Sections 1 and 26, and Sub-section

(2) of Section 4 of this Act shall come into force immediately and the other Sections and Sub-sections shall come into force in such areas and on such dates as the Government of Nepal may appoint, by a Notification in the Nepal Gazette.4 2. Definitions: Unless the subject or the context otherwise requires, in this Act,

(a) ” Court fee” means such a fee as is chargeable and collected by a court along with a plaint, complaint or appeal and with a petition for review or revision as specified in this Act.

(b) ………..5

(c) …………6

(d) “Suit (Nalesh)” means a plaint (Phiradpatra).

(e) “Complaint” means a submission for the institution of a case originally, by a petition, instead of a plaint.

(f) “Court” means and includes the bench of an office or individual authorized to carry out the functions of a court.

(g) “Tax (Tiro)” means the land revenue or land tax.

Chapter-2 Amount in question and offence to be set out

Chapter-2 Amount in question and offence to be set out

3. Case not to be filed without payment of court fee: Except as otherwise mentioned in the other Sections of this Act, no court shall take a suit or complaint or memorandum of appeal or petition for review or revision, and proceed with the same without collecting the court fee as specified by this Act.

4. Matters to be set out in making plaint or complaint:

(1) In making a suit or complaint of a case chargeable with court fees pursuant to this Act, no suit or complaint shall lie if it does not clearly set out the cash value or amount in question of the movable or immovable property where the suit or complaints claims for the entitlement or disentitlement to such a movable or immovable property or clearly set down the matter of claim where the claim is only that any matter required to be done has not been done or any matter required not to be done has been done or about to be done by another person. Provided that:

(1) In relation to a case for the execution and provision of partition, a suit shall lie even if it does not set out the amount in question. After it is found that partition has to be executed, the amount in question/value shall be fixed upon taking an inventory of the partition share to be partitioned indicating its value and amount in accordance with the Nepal law and the court fees shall be collected accordingly.

(2) Where, while making a suit or complaint, only a claim that another person has not done any matter required to be done or has done or is going to do any matter required not to be done has been made in the beginning but it is required subsequently to settle (Taikat) also the matter involving the provision and recovery of a value and amount in question, such a case shall not be tried without payment of the chargeable court fees in relation to such a value and amount in question. (2)7 In setting out the value and amount in question pursuant to subsection (1), the value and amount in question shall be fixed as follows in the case of a land or other immovable property:

(a) The value/price, if any, determined by the Government of Nepal for the purpose of determining the registration fee or amount of tax. Provided that, where such a land or other immovable property has been purchased and sold and the price of the purchase and sale exceeds the value determined for the purpose of registration fee or amount of tax, the court fees shall be levied according to the value or price set while making such a purchase and sale.

(b) Where the value/price is not determined pursuant to Clause (a) nor is the price of sale and purchase is set out, the locally prevailing value.

Chapter-3 Determination of amount in question and rate of court fees

Chapter-3 Determination of amount in question and rate of court fees

5. Determination of value, amount in question: While determining the value, amount in question in order to collect court fees, the value, amount in question shall be determined as follows, in the following matters including the matter of claim made by the plaintiff or for release from claim:-

(a) Where the claim is for entitlement to cash or for disentitlement to cash, according to the figure of cash as entitlement to which has to be established or de-established,

(b) Where the claim is for the recovery of gold, silver, ornaments (Jawaharat), utensils, livestock, grains, timber etc. movable property or the disentitlement of a claim thereon, according to the figure upon determining the value and amount in question of the property at the rate of the property in question prevailing at the local village or market,

Explanation: 8 If there arise any dispute as to the local village or market price of the gold, silver or ornaments, the value or price determined by any other bank or financial institution recognized by the Nepal Rastra Bank or the Government of Nepal shall prevail.

(c) In relation to goods of which selling price or value is not prevailing at the local village or market, according to the figure of value or amount in question determined by the plaintiff,

(d) Where a claim is made on entitlement to an immovable property or land or on disentitlement of right in such property, according to the figure of value or amount in question as determined by the suit or complaint maker pursuant to Sub-section (2) of Section 4,

(e) Where a claim is made on disentitlement of a secured farmer to the right of secured farmer, half the value, amount in question of the land as determined pursuant to Clause (d) shall be considered as its value or amount in question, and according to that figure,

(f) …………….9

(g) …………….10

(h) ……………11

(i) Where a claim is made for crops yields of a land cultivated on half crop-sharing basis or for disclaimer, according to the figure of income of the half crops of a previous year in which a divine act (Daibi) did not occur,

(k) In a case claiming that the half crops of the land suffering a divine act were not remitted, according to the figure, if any, specified that the same need not be paid,

(l) Where a claim is made for a house (building), cartilage and crop income, as well, or for disentitlement of right therein, according to the value of the house at the rate prevailing at the local village, market and the value as per that set forth in Clause (d) in the case of cartilage and according to the claimed amount of crop income,

(m) ……………….12

(n) ………………13

(o) ………………..14

(p) In a case requesting for the remission of any thing other than the crops of a land, according to the figure of amount in question requested for remission,

(q) In a case requesting for entitlement to the function of Guthi, Mahantyai, priest, store in-charge (Bhandare), Tahaluwa, server (Susare) etc. or for disentitlement of right claimed therein or for dismissal from the function, according to the figure of the residue or surplus receivable upon operation of the Guthi, and where claim is made for other, according to the value, amount in question of the land where the land is assigned and that of one year’s income receivable where the land is not assigned,

(r) In a case claiming that a land was disentitled in an unauthorized manner or that a land to which one is entitled was provided to another, according to the figure of tenant’s share in crops (Mohiboti) of one year,

(s) Where a claim is made that in making eviction (Pajani) of land, the land was given to another, which should have been given to him or her, according to the figure of such value of the claimed land as to be set pursuant to Clause (d),

(t) Where a claim is made that eviction of land was made by an unauthorized person (Betaluk), according to the figure of such value of the land as to be set pursuant to Clause (d),

(u) Where a claim is made for entitlement to a contract amount or for disentitlement of right therein, according to the figure of contract amount for the years as so claimed and where a claim is made against the loss of income, according to the figure of the loss of income as claimed,

(v) The price or valuation of a mortgaged (Bandhaki) land etc. the right or claim in which has not been given up shall be set as the amount in question, and according to that figure,

(w) In a case involving a suit by a debtor for insolvency (Damashahi) or specification of a repayment date (Bhakha), according to the figure of the amount in question indicated by the debtor,

(x) In a case claiming that one has not paid or received a salary, allowance, installment, food allowance, Jyuni, alimony (Manachawal) or that the same should be allowed not to be paid, where a land is claimed or claim is made that one be allowed not to pay the same, according to the figure of the value to be set pursuant to Clause (d) in the case of land, and according to the figure of the value claimed where other cash or in-kind has been claimed,

(y) In a case claiming that one has not paid or received a salary, allowance, installment, food allowance, Jyuni, alimony or that arrangement be made for the non-payment of the same, according to the figure thereof for one year, upon determining such figure,

(z) Where a claim is made for wages loss (damage) or compensation, according to the amount in question so claimed and in a case requesting for authorization for the non-payment of the same, according to the figure of the amount in question so requested for authorization for non-payment,

(aa) Where a claim is made for, Naso deposit or guarantee, according to the amount in question so claimed and in a case requesting for authorization for the non-payment of the same, according to the figure of the amount in question so requested for authorization for non-payment,

(bb) Where many matters including principal, profit, interest, land crops, yields, house, shop, rent thereof and movable and immovable property, cash, in-kind are claimed or a request is made for ordering non-payment of the same, according to the figure of the price, value to be set pursuant to Clause (d) in the case of land, and according to the figure of price and amount in question thereof in the case of other sum, profit, interest, rent, income, cash and in-kind,

(cc) Where a suit or complaint is made claiming principal and interest as well, court fees shall be charged according to the figure of interest to be accrued up to the date of such a suit or complaint, and if the interest is recoverable thereafter and up to the date of judgment, court fees chargeable on the interest from the date of making of the plaint or complaint to the date of final judgment shall be recovered when the amount in question is recovered,

(dd) In determining the amount in question of the goods the recovery whereof is requested for by making a suit or complaint as per the rate prevailing at the local village or market, then the value or amount in question thereof shall be set out in the complaint at the rate prevailing at the place of payment where a deed or contract is available to the effect that payment thereof shall be made at that place at the rate prevailing at the time of making suit, and failing such a contract, as per the rate prevailing at the village or market of the place where the price is fixed or of the place where it has to be to be received or taken and court fees collected accordingly; and if the price or value so set out seems doubtful, the suit or complaint hearing authority may ascertain the matter upon inquiring thereinto,

(ee) Where a claim is made for the establishment of right in a land or for the registration or transmission of a land or voiding the registration or transmission of a land, court fees shall be charged according to the figure of the value or amount in question of the land to be set pursuant to Clause (d), in the case of claim for the establishment of the right in the land, and court fee of One Hundred Rupees15 shall be charged in the case of the claim for the registration or transmission or voiding the registration, transmission.

6. Rate of court fee: In hearing a suit in a case charged with the court fee, there shall be charged the court fee as follows: (a) In a case involving a claim in, or request for disentitlement of claim in,……….16 in accordance with the following in each case according to the figure of value or amount in question:

(1) ……………17

(2) 18 Rs.100.00 (One Hundred Rupees) for the first Rs. 2,000.00 (Two Thousand Rupees),

(3) Up to Rs.25,000.00 (Twenty-five Thousand Rupees), at the rate of Four percent for the second up to Rs. 23,000.00 (Thirty Three Thousand Rupees),

(4) Up to Rs.100,000.00 (One Hundred Thousand Rupees), at the rate of Three percent for the third up to Rs. 75,000.00 (Seventy Five Thousand Rupees),

(5) Up to Rs.250,000.00 (Two Hundred Fifty Thousand Rupees), at the rate of Two percent for the fourth up to Rs. 150,000.00 (One Hundred Fifty Thousand Rupees),

(6) In the case of more than Rs.250,000.00 (Two Hundred Fifty Thousand Rupees), at the rate of One and half percent for the over and above figure.

(b) In the following cases where the amount in question is not set out, and despite that the amount in question is set out, the prevailing law provides for specific punishment but not according to the value or amount in question and where punishment is imposable at the discretion according to offence, the following court fees in relation to each case:

(1) Rs. 1,00.00 (One Hundred Rupees) 19 in relation to each case requesting for the establishment of the figure of partition share only, without involving the recovery of partition, or for settlement without establishing the right in partition or for ascertaining the portion of share only,

(2) Rs. 1,00.00 (One Hundred Rupees) 20 in relation to each case, also out of the following cases:

(1) Requesting for the voidance of bonds, deeds,

(2) Claiming that a deed executed in household and required to be registered has not been caused to be registered, and requesting for the execution of registration thereof,

(3) Claiming that a receipt was not given upon payment, and requesting for the execution of the receipt thereof,

(4) Claiming that a bond, deed of date of repayment (Bhakapatra), guarantee letter (Jamanipatra), bond, receipt etc, was not voided upon the completion of act of receiving and giving or that a receipt was not given,

(5) Requesting for the eviction of any person staying in a land, house or shop or for an order against the eviction,

(6) Claiming that counterpart (Dohori) documents duplicates required to have been made were not made and requesting for the execution of the same,

(7) Requesting that amount be recalculated, upon being dissatisfied with the amount calculated,

(8) Claiming that one has not been allowed to make a barrage, ditch or course or to carry water through the same or that another person has not been involved in making the same,

(9) Claiming that one has not been allowed to irrigate a land with the water carried through a barrage, ditch or course,

(10) Claiming that, in irrigating a land, one should have done so in according to roll order, but one whose turn is later has taken water and irrigated one’s land earlier, and then requesting for an order requiring irrigation of land according to roll order or that water be provided,

(11) Claiming that one has closed or not allowed to open an exit, door, veranda, passage, window, and then requesting that the same be ordered to be opened or closed,

(12) Claiming that one has not allowed to install an window, door, veranda, exit and add a storey, and then requesting that the complaint be allowed to install the same or that the exit be closed,

(13) Claiming that registration, transmission be effected or the effected registration, transmission be voided, without a claim for the establishment of the right in a land, and

(14) Requesting for the issuance of an injunction ordering someone to refrain from doing a specific act. (3) 21 Notwithstanding anything contained in Clause (2), where the right in any movable or immovable property has to be established or de-established by the plea of the defendant or opponent, the court fee as referred to in Clause (a) shall be charged.

(c) Where, on a suit or complaint of partition case requesting for the execution of partition by taking an inventory of properties (Tayadati) because of the amount in question not being set out, after it is held that one is entitled to partition and the amount in question is set out upon taking the inventory of properties, the court fee shall be charged according to the amount in question. Deduction shall be made from the court fees paid in making a suit as referred to in Subclause (1) of Clause (b), and the shortfall shall be recovered subsequently, and surplus amount, if any, shall be refunded.

(d) Even in relation to a case tried summarily (Thado Karbahi) by a complaint, it shall be filed only upon collecting the court fee as if a suit were filed. No such complaint shall be tried if the court fee is not paid.

(e) The whole court fee shall be charged even in relation to a suit or complaint made by or against a woman or minor.

7. Provisions on levying court fee in some cases: (1) Where it appears that, if the claim made by the plaintiff on the same suit is sustained, one or more than one defendant are liable to punishment according to the value or amount in question and one or more than one defendant are liable to punishment according to the offence or to both punishments, the court fee shall be levied according to the figure of the value, amount in question in the case of punishment to be imposed according to the value, amount in question, according to the punishment of offence in the case of punishment to be imposed according to the offence, and according to that of both in the case of both punishments to be imposed.

(2) Where a suit or complaint is made for the provision of partition and the amount in question of some is set out and that of some is not set out, the whole court fee shall be levied to the extent of the amount in question so set out, and the court fee of One Hundred Rupees shall be levied in relation to that portion of which amount in question is not set out, and the remaining shall be recovered subsequently as mentioned in Clause (c) of Section 6.

(3) If, in collecting the court fee, some denomination less than Paisa has also to be collected according to the calculation of the court fee, such denomination shall not be collected.

8. Fee for statement of defense (Pratiuttar Patra): In making a statement of defense on a case chargeable with the court fee, the fee for the statement of defense leviable pursuant to the prevailing law cannot be waived, and on a case in which a statement of defense is not required to be made and which is inquired summarily (Thado Karbhi), the fee for the statement of defendant is not chargeable on the defendant.

Chapter-4 Exemption and non-exemption of punishment

Chapter-4 Exemption and non-exemption of punishment

9. Punishment not required to be imposed: In a case chargeable with the court fee pursuant to this Act, no punishment imposable by the other prevailing law, other than the punishment that cannot be exempted by virtue of Section 10, shall be imposed. If the plaintiff wins the case, the plaintiff shall be entitled to the recovery of such court fee, as well as the amount in question, paid or held to be payable by the plaintiff as held recoverable by the plaintiff from the losing defendant. If the plaintiff loses the case, the plaintiff shall not be entitled to have the recovery of the court fee paid by him or her from the defendant; and where the case has been filed without collection of the court fee or without collection of the whole court fee, then judgment has to be made that the court fee that remains recoverable upon deducting the paid court fee be recoverable from the party who is liable to pay the same pursuant to this Act and recovery thereof shall be made in accordance with this Act.

10. Punishment cannot be exempted despite payment of court fee: (1) In spite of the court fee being chargeable, no punishment imposable for omission to do any act required to be done under, or for doing any act prohibited by, or default on giving any thing required to be given by, the prevailing Nepal law, including the matters set forth below shall be exempted:

(a) Punishment as referred to in law imposable on a person who makes a suit or complaint that can be made pursuant to the prevailing law, but upon producing a document that does not meet the requirements prescribed by the prevailing law.

(b) Punishment imposable on a person who fails to give a counterpart (Dohori) document or slip as required to be given or otherwise makes difference in witness and contents in a counterpart document.

(2) If the prevailing Nepal law provides for punishment to the publicly inquired persons who have been subpoenaed for evidence on a case chargeable with the court fee for having made false deposition (perjury), or being failure to appear within the time-limit, such punishment cannot be exempted.

(3) Any punishment imposable by the prevailing law on a person who, consequent to a judgment on a case chargeable with the court fee, does not do any act required to be done pursuant to the prevailing law, or causes obstruction in the recovery of the amount in question, in the foreclosure and does any forceful act in that course and conceals property cannot be exempted.

11. When case is dismissed, canceled or compromised:

(1) No fee for compromise (Baksauni) shall be charged on a case filed upon paying, or on the condition of the payment of, the whole court fee, and if that case is dismissed, canceled (Kharej), no punishment shall be imposed for the same.

(2) Where a case chargeable with the court fee has been filed without collecting the court fee is to be compromised in accordance with the prevailing law, compromise can be executed only upon collecting the remaining shortfall court fee, upon deducting the court fee paid from the court fee chargeable on the matters to be compromised payment, from the plaintiff or appellant. Where a case is dismissed or canceled (Kharej), the remaining shortfall court fee, upon deducting the court fee paid from the court fee chargeable pursuant to this Act, shall be recovered from the plaintiff or appellant in accordance with this Act.

(3) Despite that a case is dismissed or canceled after the filing of the case upon charging the court fee or subject to the payment of the court fee, no court fee already collected or about to be collected can be refunded or waived in any case. However, where such a case is compromised, only half the total figure of the court fee chargeable by this Act shall be collected, and surplus court fee collected, if any, shall be refunded and the remaining, if any, unchargeable shall be remitted. Provided that, in the event of cancellation of a case, if the case could not be instituted by the very writing of the suit or complaint but it appears that the case was filed by collecting the court fee by mistake of the court, the court fee remaining upon deducting the suit fee (Nales Dastur) chargeable pursuant to the prevailing law22 shall be refunded.

(4) Where a case which has already been dismissed, canceled or compromised in accordance with the procedures prescribed by law is revived in any manner and retried by a complaint of the litigant, the litigant on the complaint of whom the case is so retried shall pay again the court fee chargeable by this Act at the original or appellate level at which the case is being tried.

12. Security chargeable for giving attorney not to be collected: If, on a case chargeable with the court fee, in which attorney may be appointed, any attorney is appointed by the plaintiff or defendant or both, no security chargeable by the prevailing Nepal law for appointing the attorney shall be collected.

13. 23 Ten percent fee, Five percent fee and Jitauri: (1) Where Ten percent (Dashaud) fee is chargeable by the prevailing Nepal law in executing the recovery of the amount in question or foreclosure, no Ten percent fee shall be collected on a case charged with the court fee. 24Provided that, in the case of a party in relation to whom the case trying officer or judge has executed a memorandum pursuant to Section 23 to the effect that the party is not able to pay the court fee, no fee as referred to in this Sub-section shall be collected from that party in executing the recovery of the amount in question valued up to Rs. 5,000.00 (Five Thousand Rupees) or in foreclosing any property valued up to Rs. 5,000.00 (Five Thousand Rupees).

(2) No Jitauri and royalty (Salami) chargeable by the prevailing Nepal law shall be collected on a case charged with the court fee. (3) No Ten percent fee chargeable by the prevailing Nepal law shall be collected while executing the recovery of the amount in question or foreclosing any property on a case charged with the court fee.

Chapter-5 Provisions on collection of less or more court fee

14. Provisions relating to where suit or complaint or memorandum of appeal mentions lesser court fee and where more court fee is collected:

(1) A case chargeable with the court fee shall be filed by collecting the chargeable court fee by determining the value, amount in question according to what is mentioned in the suit or memorandum of appeal tendered for filing or in a complaint or statement on a case tried summarily or directly.

(2) Where a party, with intent to pay less court fee, does not show the correct value, amount in question but shows more value, amount in question, and a complaint is filed on that matter and upon an inquiry into the matter, it is so held, the shortfall court fee shall be collected subsequently in accordance with Sub-section (10), and the party shall also be punished in accordance with this Act.

(3) Where it appears that the party tenders lesser court fee than that chargeable according to the writing of a suit, complaint or memorandum of appeal filed on a case chargeable with the court fee, the case can be filed only upon payment of the shortfall court fee. If the party, being unable to pay the court fee, makes a submission for a time-limit for payment of the same and the period of limitation for making suit, complaint or appeal is less than Fifteen days, the court may extend the time for up to Fifteen days running from that remaining period. In the event of failure to pay the court fee within that time-limit, no suit or memorandum of appeal or complaint shall lie.

(4) If the court knows in any manner or it is held, after the filing of case, that the court fee that is lesser than that to be collected according to the writing of a suit, complaint or memorandum of appeal has been collected or paid, the court shall give an order slip to the concerned party to pay the short fall amount of court fee within a time-limit not exceeding Fifteen days. In the event of failure to pay the court fee, the court shall void the suit or complaint or memorandum of appeal.

(5)25 If it appears that more court fee than that required has been collected from any litigant, the excess court fee shall be refunded to the litigant in accordance with this Act. In having the recovery of the court fee by a litigant who has filed a suit on payment of the court fee and won the case from the losing litigant, that winning litigant is entitled to the recovery of only the court fee that is chargeable on the case. In refunding the court fee upon finding that more court fee has been paid, a memorandum shall be executed indicating that such-and-such amount has been paid instead of such-and-such as chargeable and such-and-such excess is to be refunded, and recorded in the case-file.

(6) Where, after the collection of the court fee by determining the value, amount in question according to the writing set down by the plaintiff or appellant, a complaint is made that lesser court fee has been charged or though a complaint is not made, more value, amount in question appears from the evidence recorded on the case-file, and it appears that lesser value, amount in question is shown in order to charge lesser court fee, adjudicating authority or judge shall personally or through other employee subordinate to him or her determine or cause to be determined again the court fee of such lesser value, amount in question, 26 and take action, pursuant to Sub-section (10), against one who has shown such lesser value, amount in question for having shown the value, amount in question of lesser court fee, and the case cannot be instituted and shall be canceled in the event of failure to pay the shortfall court fee within the time-limit specified pursuant to Sub-section (3).

 

(7) Where, on a suit or complaint made indicating the value, amount in question, for making partition, the court fee has been charged according to the value, amount in question as so indicated and shown but when having execution of the recovery of partition share, the party is entitled to more partition share than that so indicated and shown, the remaining court fee shall be recovered at the time of executing the recovery of partition share, after the judgment on the case.

(8) In examining the case-file by the official empowered to do so or also by the appeal hearing official on a case appealed, such official shall examine whether the required court fee has been collected or not, and if it appears that lesser court fee has been collected, such official shall order to collect the shortfall court fee from the plaintiff or appellant in accordance with Sub-section (3). In the event of failure to pay the court fee within the specified time-limit, such case shall be canceled (rejected). The concerned employee of the court shall be liable to action as referred to in this Subsection (14).

(9) If a party who is not satisfied with the court fee as determined by the court makes a complaint with the appeal hearing authority within Three days excluding the time required for journey where the party has not yet paid the court fee as determined and prior to the passing of judgment on the case on which the court fee has been paid where the court fee so determined has already been paid, the appeal hearing court shall inquire into the matter and ascertain the matter within the time-limit of Seven days specified for payment of the same, whichever is earlier, and punish the concerned employee of the court who has collected or determined the court fee in accordance with Sub-section (14) if it is held that more court fee has been collected or determined and punish the complainant with a fine at the rate of Fifteen percent of the figure as alleged to have been collected or determined in excess if it is held that the court fee has been collected or determined correctly and that the complaint is false. Where a suit, complaint or appeal is tendered for filing, accompanied by the court fee as held chargeable, within Three days, excluding the time required for journey, after the date of settlement of a complaint made that excess court fee has been determined, the limitation cannot expire where the suit, complaint or appeal was earlier tendered for filing with the competent court within the limitation as referred to in the prevailing law, and the official of the court shall set down that matter as well as all other required matters on the heading of the suit or complaint and sign it and file the case, and record it on case-file, accompanied by an evidence of the settlement of complaint.

(10) One who files a case showing lesser value, amount in question in order to pay lesser the court fee shall be liable to the following consequences:

(a) If, upon inquiring into the matter by a complaint of the opponent, a party is held to have shown and set down lesser value, amount in question, the party who has so shown and set down lesser value, amount in question shall, despite that the party wins the case on the judgment of the case, not be entitled to have recovery of that court fee so paid subsequently from the person who has provided that such lesser court fee has been shown and set down and lost the case.

(b) If, upon inquiring into the matter by a complaint of any person other than the opponent or also upon examining even without a complaint, a party is held to have shown and set down lesser value, amount in question in order to pay lesser court fee, the party who has so shown and set down lesser value, amount in question shall be liable to a fine of One Tenth (1/10th) of the court fee so lessened and to a fine of One Twentieth (1/20th) in the case as referred to in Clause (a).

(c) If it appears that the court itself knowingly or having reason to know has collected the court fee that is lesser than that chargeable, the plaint or appellant shall not be liable to the fine.

(11) In giving a notice process as mentioned in this Section for the payment of the short fall court fee where lesser court fee has been collected, it shall be written in the heading or margin of the notice process so given that the notice process corresponding there has been received on such-andsuch date, which shall be signed by the recipient plaintiff or appellant or his or her attorney, and where such plaintiff or appellant are not on recognizance, the notice process shall be served in accordance with the procedures to be followed while serving a process or summons, and one copy of the served notice process shall be recorded on the case file.

(12) Where the shortfall court fee so appearing has been collected or excess court fee refunded after the filing of a case upon paying the court

fee, the same matter shall be indicated in the receipt issued against collection of the court fee earlier. (13) Where a complaint is made claiming that lesser value, amount in question has been shown and set down in order to pay lesser court fee, and upon inquiring into the matter, it is not held that the value, amount in question has been so lessened, the false complainant shall be liable to a fine of Five percent of the court fee alleged to have been lessened. (14) Legal action shall be taken against the employee of the court who knowingly collects more or less court fee than that chargeable, and where the case in relation to which less court fee has been so collected has already bee adjudged finally or the time-limit for making appeal has already expired, the amount of court fee omitted shall be recovered from such person who has so omitted to collect.

Explanation: The term “knowingly” mentioned in this Sub-section means non-collection or excess collection of the court fee of the amount in question as shown from the writing of a suit or complaint or memorandum of appeal or from the evidence, in accordance with this Act.

Chapter-6 Recovery of court fee

Chapter-6 Recovery of court fee

15. Execution of recovery of court fee:

(1) If the plaintiff or appellant wins a case filed upon payment of the chargeable court fee, he or she shall be entitled to the recovery of the court fee paid by him or her from the losing party.

(2) In executing the recovery of the court fee to the plaintiff on a case containing Two or more defendants, the court fee shall be recovered, in relation to the recovery of the amount in question, according to the respective figure of amount in question to be recoverable from each of the defendants, and in relation to the disentitlement or relinquishment of right or claim, according to the amount of respective disentitlement or relinquishment from each of the defendants, and in relating to the other matters or amounts, the court fee shall be recovered on pro rata from the losing parties.

(3)27 Where a case chargeable with the court fee has been filed without payment of the court fee, the court fee as held to be chargeable on the plaintiff or appellant winning the case shall be recovered from the opposite party as a fine, penalty.

(4) Where the plaintiff or appellant makes claims on several matters and wins on some and loses on others, he or she shall not be entitled to recover the court fee on the matters lost from his or her opponent.

(5) Where the plaintiff or appellant loses a case filed without payment of the court fee or on payment of partial court fee, the chargeable court fee shall be recovered from the losing plaintiff or appellant.

(6) If the plaintiff loses a partition case filed on payment of the court fee of One Hundred Rupees28 or on payment of partial court fee, the remaining chargeable court fee shall be recovered from the plaintiff, upon deducting the collected court fee from the court fee chargeable according to the amount in question.

(7) Despite that the defendant or opponent dies prior to the recovery of the court fee recoverable to the plaintiff or appellant, the plaintiff or appellant shall be entitle to recover the same from the inheritor of such a defendant or opponent.

(8) If, on a case requesting for insolvency or giving a date for repayment, the defendant creditor agrees thereto and insolvency or a date for repayment is made or given, the plaintiff debtor shall, despite winning the case, not be entitled to have the recovery of the court fee from the defendant. If the defendant creditor pleas that insolvency or a date for repayment should not be made or given and the plaintiff wins the case, the court fee shall be caused to be recovered from the losing defendant to the plaintiff.

(9) If the plaintiff or appellant wins a partition case on which amount in question is not set out or any other case filed upon payment of partial court fee or without payment of the court fee at all and the winning plaintiff makes an application within the time-limit specified by the prevailing law, requesting for the recovery of amount in question to which he or she is entitled, the remaining court fee upon deducting the court fee already collected on filing the suit or complaint or memorandum of appeal from the property of the defendant attached for the amount in question recoverable by the plaintiff shall be recovered or realized, and the surplus amount shall be recovered to the plaintiff in consideration for the amount in question, upon collecting the fee chargeable for the court fee. Where an application is not made within the time-limit as referred to in the prevailing law for the recovery or after the application has been made for recovery the plaintiff gives up in the meantime, within Fifteen days after the expiration of the time-limit for making application or after the expiration of the time-limit for the extension of the expired appointed date for appearance after the making of application, the property of the defendant shall be attached in the sum of the court fee due and recoverable on the case, in addition to the figure of the amount in question held recoverable by the plaintiff from the defendant, and the court fee shall be recovered accordingly. The remaining court fee not recovered from the attachment of the property of the defendant shall be recovered from the attachment of the property of the plaintiff.

(10) If such court fee or fee as held recoverable by the winner from the loser or as recovered from the plaintiff himself or herself pursuant to Sub-section  (9) cannot be recovered in full from the attachment of the property of the loser, and the winner makes an application, 29 showing any property, within Two years, for the recovery of the remaining court fee or fee, and it is held that the loser has such property, the recovery of the same shall be executed as if it were the recovery of the court fee or fee originally.

(11) In requesting for the recovery of such fee, court fee, amount in question as held to be recoverable30from the loser, one application may be made for the recovery of the court fee as held to be recoverable or the fee, charge paid on the case, after the expiration of the time-limit for making appeal or after the settlement of appeal thereby ruling out the possibility of appeal complaint. Provided that such an application has to be made no later than Two years31 after the date of final judgment.

12) If the defendant who makes an appeal upon furnishing the security of the court fee held to be recoverable by the plaintiff loses and the original verdict is upheld, even though the plaintiff does not make an application for the recovery at the same time of the court fee which has been furnished as security by the defendant in making appeal as well as the amount in question and fee pursuant to Sub-section (11) but for the recovery of only the money furnished as security for the court fee in making such an appeal, the recovery shall be executed in accordance with the procedures as referred to in the prevailing Nepal law.

(13) In executing the recovery of such amount in question or court fee and other fee or charge levied on the case as held to be recoverable, the recovery of the amount in question shall be executed only after executing the recovery of the court fee and fee or charge.

(14) If, prior to making an application by the winner, the judgment debtor appears to pay all moneys required to be paid by him or her within the time-limit for making an application for recovery, the court shall receive the same and give a receipt thereof, and credit the same to the deposit revenue, and post a time-limit notice/process within Three days, indicating that the judgment holder is thereby required to appear within the time-limit as referred to in the prevailing law and that recovery of the same cannot be executed and it shall be as per the prevailing law, after the expiry of the time-limit, and the recovery shall be executed and receipt given if the judgment holder appears to receive the same within the time-limited; and if the judgment holder, despite getting such notice, does not appear within the time-limit, the money remaining upon deducting any money, if any, chargeable under this Act, from the same shall be dealt with in accordance with the prevailing Nepal law.

16. Recovery of expenses from losing party to winning party: (1) 32 If the plaintiff or appellate making a suit or complaint or appeal wins the case, he or she shall be entitled to have recovery from the defendant or opponent the summons, process and duplicate fees paid by him or her and such legal practitioner’s fee, reasonable expenses incurred for experts, witnesses and attorneys as may be recoverable pursuant to the prevailing laws and such other expenses as well, as appear reasonable from the case-file, and if the plaintiff or appellate loses and the defendant or opponent wins the case, the defendant or opponent shall be entitled to the recovery of the above-mentioned fee, charge or expenses required to be paid by him or her from the losing plaintiff or appellant.

(2) If the case is canceled (rejected) or dismissed by virtue of the suit, complaint being incapable of being tried since only the plaintiff gives up the recognizance while the defendant is in attendance on the appointed dates, the defendant shall be entitled to have the recovery of the fee chargeable on him or her from the plaintiff.

17. Refund of court fee:

(1) If the party entitled to the refund of such court fee as held to be refundable appears to have refund of the same within Two years after that date on which such refund is so held, and it is required to wait until the time-limit for appeal, the refunding court shall, subject to the budget provision, refund or cause to be refunded the moneys from the income reserve of the court, after the expiration of the time-limit for making appeal. If the income reserve does not allow for making such a refund, the sanction of the remaining amount shall be obtained and refund made accordingly.

(2) After the refund required to be made has been pursuant to Subsection (1), the matter that such-and-such more court fee or such-and suchcourt fee held to be refundable has been refunded on such-and-such date shall be set down in the receipt issued against payment of the court fee earlier, and the receipt shall be signed by the refund maker.

Chapter-7 Provisions relating to court fee on making appeal

Chapter-7 Provisions relating to court fee on making appeal

18. Court fee chargeable on making appeal:

(1) On making an appeal the following provisions shall apply to the following matters, and the fee for memorandum of appeal shall not be charged:

(a) In making an appeal on a case in which the amount in question is set out, the court fee shall be charged on appeals of all levels at the rate of 15 (Fifteen) percent of such court fee as is chargeable, while making a suit or complaint originally, on those matters on which appeal is made upon being dissatisfied therewith.

(b) If, in a partition case filed upon payment of the court fee of 33One Hundred Rupees only, the plaintiff loses the case upon being held to be entitled to the claimed partition and makes appeal and the amount in question is not set out, the court fee equivalent to that chargeable originally shall be charged on appeal of any level.

(2) Only after the payment of such court fee as held to be payable to the plaintiff and the specified penalty, fine by the appellant defendant who has, on the first appeal, lost the case and made appeal and after payment of such court fee as held to be payable and the specified penalty, fine by the plaintiff who has lost the case filed without payment of the court fee and made appeal or only after furnishing a wealth guarantee in consideration for the same, and an appeal has to be made subsequently, such appeal may lie only after making payment of what is required as per the judgment of first appeal or furnishing a wealth guarantee for the same.

(3) If an appeal, complaint is made upon paying the court fee or subject to the payment of the court fee and the appellant litigant loses the case upon the verdict of the lower court being upheld, the litigant shall not liable to other punishment for making such an appeal.

(4) If the appellant litigant wins the case in whole or in part, the litigant shall be entitled to the recovery of such court fee as held chargeable on the matter won by and paid by him or her from the losing opponent. Such court fee, penalty and fine as paid or furnished as security on making appeal and held refundable shall also be refunded in accordance with the procedures as referred to in the prevailing Nepal law.

Chapter-8 Miscellaneous

Chapter-8 Miscellaneous

19. Court fee chargeable on review or revision:

(1) In making a petition to the court competent to do so by the prevailing law for the review (reexamining) or revision (revisiting the verdict) of a case, no action shall be taken on the petition for review or revision unless and until such court fee or charge or penalty as chargeable by the judgment for the review or revision of which the petition is made is paid or any other provision made by law in relation thereto is made.

(2) If an order is made for review or revision, the court fee shall be paid at the rate of 10 (Ten) percent of the court fee chargeable on making a suit in the original court or after judgment.

(3) If, in making review or revision, the petitioner if wins the case partly or wholly, it shall be equivalent to the case appealed pursuant to Subsection (4) of Section 18. 20.34 Collection of court fee in cash: (1) In collecting and giving the court fee on a case chargeable with the court fee, it shall be collected and given in cash.

(2) After collecting the court fee pursuant to Sub-section (1), the court shall credit the same to its cash book, duly prepare a receipt thereof in duplicate, give one copy receipt to the litigant paying the court fee and retain the other copy of receipt in the concerned case-file.

(3) After examining a suit or complaint or appeal chargeable with the court fee and upon finding it to be capable of being file, the concerned official shall get it to be signed and mention on the top of the deed that such-and-such court fee has been collected and clearly mention that so much has been collected out of so much as required where court fee has not been collected at all or full court fee has not been collected originally, and duly sign the same.

(4) The Registrar of the Supreme Court or other officer designated by him35 or her and the chief officer of any other court shall on daily basis examine, or cause to be examined, whether such court fee as leviable on a case chargeable with the court fee has been collected properly or not and where the income of collected court fee has been maintained or recorded or not, and indicate the proof of examination. No case may be entered on the diary unless and until examination is made whether the court fee is credited to the revenue book and proof thereof is indicated.

(5) It shall be the duty of the Supreme Court to examine, or cause to be examined, each year the matters including whether the sub-ordinate courts have collected such court fee as required to be collected and income of collected court fee has been credited to income or not.

(6) Where a case has been filed without collecting the court fee leviable pursuant to this Act or the security fee and judgment on it has also been made and the court fee could not be recovered from the litigant, then

legal action shall be taken against the employee who have collected less or more court fee for that loss in relation to the court fee not recovered.

(7) The court inspecting authority shall examine and inquire whether the court fee has been collected in full and the court fee has been credited in accordance with this Act or not, and if appears in order, the authority shall indicate the same, and if it appears that the court fee has not been collected in full or the court fee required to be credited has not been credited, the authority shall take required action against those who fail to do so, in accordance with the prevailing law; and after an appeal, compliant is made on a case chargeable with the court fee and the case-file is submitted to the appeal hearing court, that court shall also examine the above-mentioned matters. If some defects or irregularities are found, the appeal hearing authority who makes examination of courts shall set down the matter found and date and sign the same and submit that matter to the Supreme Court.

(8) In relation to the cases filed prior to the commencement of this Act, the then prevailing law shall apply, and the court fee as referred to in this Act shall not be levied on such cases.

21. Procedures to be followed while recovering remaining court fee: In recovering the remaining court fee, the recovery shall be made by taking action as if it were a court penalty, fine.

22. Register of court fee to be maintained: There shall be a duly established and maintained register clearly showing cash figure of court fee, and indicating how much court fee has been collected from whom on which case.

23.Cases of those unable to pay court fee may be tried: Notwithstanding anything contained in the other Sections of this Act, the Adjudicating Authority or judge may, in the following circumstance, and for reasons to be recorded in a memorandum, order to file a suit, complaint, memorandum of appeal or petition for review or revision, subject to the collection of whole or some of the court fee subsequently:

(a) If the Adjudicating Authority or judge has any reasonable ground to believe that the person making a suit, complaint, memorandum of appeal or petition for review or revision, being indigent, is not able to pay whole or some of the court fee,

(b) If it is recommended by the concerned Village Development Committee or Municipality that the person making a suit, complaint, memorandum of appeal or petition for review or revision has no other asset other than the goods in dispute and is thus unable to pay the court fee or the Adjudicating Authority or judge has any reasonable ground to believe that matter.

24. This Act to prevail: (1) This Act shall not apply to sate cases and criminal cases as referred to in the then prevailing Nepal law. 38 (2) If any local self-governance body is conferred the powers of court by any Nepal law or in accordance with Nepal law, such a body shall not be entitled to use this Act.

25. Power to frame Rules: The Government of Nepal may frame Rules in order to accomplish the objectives of this Act.

26. This Act or Rules under this Act to prevail, and repeal: (1) The Khadga Nisana Sanad of 8 Marg 1999 and of 17 Shrawan 200 in relation to the court fee shall and the Act of 28 Number of the Chapter on Punishment are hereby repealed with effect from the date of commencement of this Act. (2) The matters contained in this Act or the Rules framed under this Act shall be governed by this Act or the Rules and the other matters shall be governed by the prevailing Nepal law.

27. Power to remove difficulties: (1) If there arises any difficulty with the implementation of the objectives of this Act, the Government of Nepal may, by a Notification in the Nepal gazette, issue necessary order in order to remove such difficulties, and such an order……………39 shall be deemed to have been contained in this Act. (2) ………………….40

Preamble

Act number 8 of the year 2049(1992)

An Act Made to Provide for the Cooperative Associations and Societies

Preamble: Whereas, it is expedient to make provisions on the formation and operation of various types of cooperative associations and societies based on the mutual support and cooperativeness for the economic and social development of the general pubic consumers by the farmers, craftsperson (Kaligadh), class of people with low capital and low income, labors, landless and unemployed people or social workers of the country; Be it enacted by the Parliament in the twenty-first year of the reign of His Majesty King Birendra Bir Bikram Shah Dev.

Chapter-1 Preliminary

Chapter-1 Preliminary

1. Short title and commencement: (1) This Act may be called as the “Cooperatives Act, 2048(1992)”. (2) This Act shall come into force immediately.

2. Definitions: Unless the subject or the context otherwise requires, in this Act: (a) “association” or “society” means a cooperative association or society registered pursuant to Section 5. (b) “member” means a person, association, society or other body who has obtained membership by subscribing shares of an association or society in accordance with the Bye-law of such association or society. (c) “board” means the board of directors formed pursuant to the Bye-law of an association or society. (d) “Registrar” means the registrar appointed pursuant to Section 21.

(e) “general meeting” means the general meeting of the concerned association or society. (f) “Bye-law” means the Bye-law of the concerned association or society. (g) “prescribed” or “as prescribed” means prescribed or as prescribed in the Rules framed under this Act.

Chapter-2 Formation of Association or Society

Chapter-2 Formation of Association or Society

3. Formation of association or society:

(1) An association or society as follows may be formed with a view to rendering services and facilities for the economic and social development of its members in consonance with the cooperative principle.
(a) A preliminary association consisting of at least twenty five persons as its members.
(b) A sectoral society consisting of at least five associations as referred to in Clause (a) as its members.
(c) A District cooperatives society consisting of at least five associations or sectoral societies out of those as referred to in Clause (a) or in Clause (b) or both as its members.
(d) A central cooperatives society consisting of at least twenty five sectoral associations as referred to in Clause (a) or at least five sectoral societies as referred to in Clause (b) as its members.
(e) A national cooperatives society consisting of at least fifteen societies as referred to in Clauses (b), (c) and (d) as its members.

(2) Notwithstanding anything contained in Sub-section (1), not more than one District cooperatives society or sectoral society of the same nature and not more than one central cooperatives society of the same nature may be formed in the same District.

(3) The jurisdiction/domain of an association or society shall be as specified in the Bye-law of that association or society.

 

4. Application for registration of association or society: (1) The members concerned have to make an application to the Registrar for the registration of an association or society formed pursuant to Section 3. (2) An application to be made pursuant to Sub-section (1) has to be accompanied by two copies of the Bye-law of the concerned association or society, work plan and description of shares which the members have undertaken to subscribe and signed by at least the members as referred to in Section 3.

5. Application for registration of association or society: (1) On an application made pursuant to Section 4 for the registration of an association or society, the Registrar shall hold necessary inquiry as to whether the Bye-law of that association or society is in consonance with the cooperative principle. (2) If the Registrar so considers appropriate on an inquiry held pursuant to Sub-section (1), the Registrar shall register the association or society and issue the registration certification, as prescribed.

6. Powers to refuse to register: (1) If, on an inquiry held pursuant to Sub-section (1) of Section 5, the Registrar thinks that any matter needs to be amended, the Registrar shall give the persons making application for the registration of the concerned association or society a notice for amendment within fifteen days. (2) If the applicants refuse to make amendment pursuant to the notice as referred to in Sub-section (1) or fail to make amendment within thirty five days after the date of receipt of such notice, the Registrar may refuse to register the association or society and assign the reasons for such refusal to register and give information thereof to the concerned applicants. (3) Where the Registrar refuses to register an association or society pursuant to Sub-section (2), an applicant who is not satisfied with such refusal may make a petition to Government of Nepal.

7. Association or society to be body corporate: (1) An association or society shall be an autonomous and body corporate with perpetual succession. (2) An association or society shall have a separate seal of its own for all of its activities. (3) An association or society may, like an individual, acquire, use and otherwise deal with any movable and immovable property. (4) An association or society may, like an individual, sue by its name and be also sued by the same name.

8. Liability of association or society to be limited: (1) The liability of an association or society shall be limited. (2) The name of each association or society shall contain the word “cooperative” and the word “limited” as its last word.

Chapter-3 Membership of Association or Society

Chapter-3 Membership of Association or Society

9. Membership of association:

(1) The Nepalese citizens as follows may be members of an association: (a) Persons who make an application for the registration of the association, (b) Persons who reside within the jurisdiction of the association, subscribe the shares sold pursuant to Section 23 and intend to avail the services of the association, undertake to bear the responsibilities attached to membership and fulfill the terms and conditions mentioned in the Bye-law, (c) Bodies which subscribe the shares sold pursuant to Subsection (1) of Section 23.

(2) A person who intends to become a member of an association has to make an application to its board.

(3) In the event of refusal by the board to provide membership, the applicant may make a petition to the general meeting; and a decision made by the general meeting on such petition shall be final.

(4) The membership of those persons who have become share members by virtue of conversion of compulsory saving into share capital shall ipso facto lapse once they get the amount of saving refunded.

10. Membership of society: (1) The concerned sectoral associations within the jurisdiction of a sectoral society may obtain membership of the sectoral society in consonance with the provisions contained in the Bye-law of that society. (2) All associations and sectoral societies within the concerned District may be members of a District cooperative society in consonance with the provisions contained in the Bye-law of that society. (3) Sectoral associations and sectoral societies may be members of a central cooperative society in consonance with the provisions contained in the Bye-law of that society. (4) All associations and other bodies as referred to in the Bye-law of a national cooperative society may be members of such national cooperative society in consonance with the provisions contained in the Bye-law of that society. (5) The bodies which subscribe the shares of a society sold pursuant to Subsection (1) of Section 23 may be members of the society.

11. Termination of membership: The membership of an association or society shall be terminated in such circumstances as prescribed.

Chapter-4 Modus Operandi

Chapter-4 Modus Operandi

12. Bye-law: (1) An association or society may, subject to this Act and the Rules framed under this Act, make a Bye-law for the operation of its business. The Byelaw so made shall come into force after having been approved by the Registrar. (2) Every association or society shall be operated and managed in accordance with the Bye-law of that association or society.

(3) The Bye-law has to set out the name, address, jurisdiction/domain, objectives, modus operandi of the association or society and such other details as may be prescribed. (4) The Bye-law may be amended by a two-thirds majority of the members present at the general meeting of the concerned association or society. (5) The Bye-law amended pursuant to Sub-section (4) shall come into force after having been approved by the Registrar.

13. General meeting: (1) Every association or society shall have its one general meeting. (2) All members of an association shall be members of the general meeting of the association. (3) The general meeting of a society shall consist of such members as mentioned in the Bye-law.

14. Functions, duties and powers of general meeting: The functions, duties and powers of the general meeting shall be as follows: (a) To examine and endorse annual accounts of the association or society. (b) To elect the board of directors and the accounts committee and make decision on removing any director or dissolving the board. (c) To discuss the reports of the board of directors and the accounts committee and give necessary directives. (d) To make decision on amendment to the Bye-law. (e) To make decision on the division of the association or society or on its unification with another association or society or on its liquidation.

15. Meetings of general meeting: (1) Every association or society has to convene its preliminary general meeting within three months after the date of its registration. (2) Every association or society has to convene its annual general meeting within six months after the expiration of every fiscal year. (3) The extra-ordinary general meeting of an association or society may be convened in such circumstances as prescribed.

(4) The quorum for a meeting of the general meeting shall be as prescribed. Provided that, the presence of fifty one percent members of the total number of members of the general meeting shall be required while making amendment to the Bye-law.

16. Board of directors:

(1) Every association or society shall have one board of directors.
(2) The formation, functions, duties and powers of the board shall be as provided in the Bye-law of the concerned association or society.
(3) The tenure of the board shall be as provided in the Bye-law but shall not exceed a period of five years. (4)The board has to get a new board elected prior to the expiration of its tenure.
(5) If the board does not hold election in time pursuant to Sub-section (4), any member may give information thereof to the Registrar.
(6) Irrespective of whether information as referred to in Sub-section (5) is received or not, the Registrar shall hold election to the board within six months after the expiration of the tenure of the board.
(7) The previous board may continue to function as provided in the Bye-law pending the holding of election to a new board pursuant to Sub-section (4) or (6).

17. Accounts committee: (1) The general meeting of every association may elect and form one accounts committee consisting of three members including one coordinator. (2) The accounts committee may perform the internal audit of the association in a regular basis and give suggestions to the board. (3) The accounts committee has to submit its accounts related report to the general meeting.

18. Expulsion of member of board or dissolution of board: (1) If a majority of the general meeting adopts a proposal submitted to the general meeting by five percent members of the general meeting, setting out the reasons and rationality for expelling any elected member of the board or dissolving the board, such member of the board may be expelled or the board dissolved.
(2) If any member of the board is expelled pursuant to Sub-section (1), the general meeting shall elect another member to the office of the member so expelled for the remainder of term.
(3) In the event of dissolution of the board pursuant to Sub-section (1), the general meeting make provision of election to the new board. (4) All the provisions contained in Sub-sections (1), (2) and (3) shall also apply to the expulsion of a member of the accounts committee or dissolution of the accounts committee.

19. Sub-committees: (1) The board may, for the performance of the business of association or society, form sub-committees as provided in the Bye-law.
(2) The functions, duties and powers and procedures of a sub-committee to be formed pursuant to Sub-section (1) shall be as provided in the Bye-law.

20. Appointment of employees and advisers: (1) The board may appoint employees and advisers, as per necessity, for the operation of the association or society, in accordance with the process endorsed by the general meeting.
(2) The remuneration and other conditions of service of the employees and advisers appointed pursuant to Sub-section (1) shall be as mentioned in the Byelaw of the concerned association or society.

Chapter-5 Registrar

Chapter-5 Registrar

21. Appointment of Registrar: (1) Government of Nepal shall appoint one Registrar to register associations or societies and perform such other functions as prescribed, subject to this Act and the Rules framed under this Act. (2) The remuneration and other conditions of service of the Registrar shall be as prescribed.

22. Delegation of powers: The Registrar may delegate any of the powers conferred to him/her pursuant to this Act or the Rules framed under this Act to any officer subordinate to him/her.

Chapter-6 Financial Source and Mobilization

Chapter-6 Financial Source and Mobilization

23. Sale of shares: (1) An association or society may collect share capital by selling its shares to those persons who are under its jurisdiction and are eligible to become its members, members and other bodies as prescribed. (2) An association or society may, with approval of Government of Nepal, sell a maximum of twenty percent share of its total share capital to a foreign cooperative association or society which is a member of the International Cooperative Alliance. (3) In selling its shares pursuant to Sub-section (1), an association shall so sell shares to a person or association that it does not exceeds twenty percent of its total share capital to the same person or association. Provided that, this restriction shall not apply to Government of Nepal or an organization or body owned by Government of Nepal. (4) A member shall be entitled to cast vote only on the basis of one person one vote irrespective of the number of shares subscribed by that person.

24. Power to issue debentures and borrow loans: An association or society may issue debentures and borrow loans from a native or foreign bank or other body. Provided that, approval of Government of Nepal has to be obtained prior to issuing debentures or borrowing loans.

25. Security of Government of Nepal may be obtained while borrowing loans: If an association or society intends to obtain the security of Government of Nepal against debentures to be issued by the association or society or loans borrowed from a foreign bank or other body, the association or society has to make an application to Government of Nepal for the same.

(2) If Government of Nepal, upon consideration of an application made pursuant to Sub-section (1), thinks appropriate, it may provide security against such debentures or loans. In providing such security, Government of Nepal may prescribe necessary terms and restrictions in respect of repayment of such debentures or loans; and the association or society has to make repayment of debentures or loans subject to those terms and restrictions.

26. Powers to carry on banking transactions:
(1) An association or society may accept saving deposits from its member and lend loans to its members.
(2) An association or society has to obtain prior approval of the Nepal Rastra Bank in order to carry on other banking transactions including acceptance of deposits and disbursement of loans limited only to its members, other than the transactions mentioned in Sub-section (1). Such association or society has to observe the terms and conditions prescribed and directions given by the Nepal Rastra Bank.
(3) An association or society carrying on business after being registered prior to the commencement of this Act has to make arrangements for carrying on transactions pursuant to Sub-section (1) or Sub-section (2) within one year after the date of commencement of this Act.
(4) Notwithstanding anything contained elsewhere in this Act, associations or societies may jointly form a cooperative bank. (5) If an application, accompanied by a recommendation of the Nepal Rastra Bank, is made for the establishment of a bank pursuant to Sub-section (4), the Registrar may hold necessary inquiry and register such bank. (6) A bank registered and established pursuant to Sub-section
(5) may carry on the banking transactions under the Commercial Bank Act, 2031(1975) approved by the Nepal Rastra Bank; and the bank has to observe the terms and conditions prescribed by and the directions given from time to time by the Nepal Rastra Bank.

27. Distribution of saving: (1) The funds as prescribed may be established out of the amounts that remain after depositing into the reserve fund at least one-fourth of the net saving of an association or society in any year. (2) A dividend or bonus to the extent mentioned in the Bye-law may be distributed from the funds, other than the reserve fund, in consonance with the purpose of such funds. Provided that, the amount of share dividend for a year shall not exceed fifteen percent of the share capital.

28. Prohibition on providing financial assistance: No association or society shall provide donation or any other kind of financial assistance to any organization or association working for any political party or religion or community.

29. Prohibition on awarding contract: No association or society shall award any contract of that association or society to any member of its board or accounts committee or its employee.

30. Share or right of member not to be auctioned: The share or right of any member remaining as the principal amount of an association or society shall not be sold by auction of any loan or liability, other than the loan or liability of the same association or society.

Chapter-7 Unification or Division

Chapter-7 Unification or Division

31. Unification or division:

(1) In order to merge and unify two or more associations with each other or divide one association or society into two or more associations or societies, a two-thirds majority of the general meeting of the concerned association or society has to make a decision to that effect. Such decision shall also set out the terms and procedures of unification and division.

(2) The Registrar shall, based on the decision as referred to in Sub-section (1), unify or divide the concerned association or society.

Chapter-8 Information, Records and Examination of Accounts

Chapter-8 Information, Records and Examination of Accounts

32. To maintain records of decisions: Every association or society has to maintain updated records of the meetings of, and activities carried out by, its general meeting, board, accounts committee and sub-committees.

33. Accounts and other records: Every association or society has to maintain records of accounts of all transactions carried on by it and other necessary records as prescribed.

34. Submission of information: Every association or society has to submit an annual report of its transactions and audit report as well as a report including the following details to the Registrar or official designated by him/her within the prescribed time each year: (a) Policy and plan set in respect of saving description, (b) List of names of directors and their remaining tenure, (c) Fixed date of the meeting of the general meeting, and (d) Such other details as prescribed by the Registrar from time to time.

35. Powers to inquire: (1) If at least five percent members of an association or society make an application mentioning that the association or society is not functioning satisfactorily, the Registrar may him/herself inquire into the matter or get such inquiry held by any official empowered in writing to that effect.
(2) In the event that the business transaction of any association or society does not appear satisfactory, the Registrar may him/herself inquire into the matter or get such inquiry held by any official.
(3) It shall be the duty of every member and employee of the association or society to render assistance in every respect by providing such information as sought while holding inquiry by the Registrar or the official authorized by him/her pursuant to Sub-section (1) or (2). (4) An information of the results of an inquiry held pursuant to Sub-section (1) or (2) shall be given in writing to that association or society.

 

36. Powers to make inspection and give suggestions: (1) The Registrar or official authorized by him/her may inspect the association or society. (2) If, in making inspection pursuant to Sub-section (1), it is not found that provisions of this Act or the Rules framed under this Act or Bye-law have not been complied with, the concerned official may give necessary suggestions to make provisions pursuant to the Act, Rules or Bye-law.

37. Examination of accounts:

(1) Every association or society has to get its accounts of every fiscal year examined by any registered auditor recognized by the Registrar or official designated by him/her within three months after the expiration of that fiscal year.

(2) Notwithstanding anything contained in Sub-section (1), the general meeting of the concerned association or society may, with the approval of the Registrar, appoint a registered auditor and cause the accounts of that association or society to be examined by such auditor.

(3) In appointing an auditor pursuant to Sub-section (2), the same person or company may not be appointed for more than three consecutive times.

(4) A report on examination of accounts has to be submitted to the general meeting and got endorsed.

(5) If the general meeting does not endorse the report on examination of accounts submitted to the general meeting pursuant to Sub-section (4), the general meeting may appoint another auditor and have an inquiry held or accounts reexamined.

(6) The remuneration and facilities of auditor shall be as determined by the general meeting.

Chapter-9 Concessions and Facilities to Association or Society

Chapter-9 Concessions and Facilities to Association or Society

38. Exemptions and facilities to association or society:

(1) Notwithstanding anything contained in the prevailing law, the association or society shall be entitled to the following exemptions and facilities: (a) The association or society shall not be required to have registration pass of any instrument relating to its transaction, other than an instrument relating to immovable property. (b) No revenue stamp fee or registration fee shall be charged on a document or any kind of instrument related with the purchase and sale or exchange of an immovable property as carried out by the association or society. (c) ———– (d) No local tax shall be levied on the goods traded by the association or society.

 

(2) Government of Nepal may, by a notification in the Nepal Gazette and pursuant to the prevailing law, exempt fully or partly from chargeable customs tariff or sales tax such machineries, industrial and agro-machines, equipment, spare parts, raw materials, office equipment and means of transport as are imported by an association or society for its use.

(3) Government of Nepal may, by a notification in the Nepal Gazette and pursuant to the prevailing law, exempt fully or partly from chargeable excise duty or sales tax the goods produced by any association or society.

(4) An association or society doing industrial business shall also be entitled to such other exemptions, facilities and protection as the industries are entitled to pursuant to the law, in addition to the exemptions mentioned in Sub-sections (1), (2) and (3).

39. Recovery of dues of association or society: Any association or society itself or the Registrar on recommendation of the association may recover the loans borrowed by any person form the association or society or any amounts due and payable to the association or society, the amount of such property of the association or society as has been embezzled as well as interest chargeable in such amounts by auctioning the assets of such person by fulfilling the procedures as prescribed.

40. Preference of association or society: If any member does not pay to the association or society any amount payable by such member, the association or society shall have preference to the amounts that remain after setting aside the amount for payment of a right or claim, if any, of Government of Nepal over the assets of such member.

Chapter-10 Dissolution of, and Cancellation of Registration of, Association or Society

Chapter-10  Dissolution of, and Cancellation of Registration of, Association or Society

41. Dissolution of, and cancellation of registration of, association or society: (1) A two-thirds majority of the total number of members of the general meeting of an association or society may decide to liquidate the association or society. (2) On receipt of an application accompanied by the decision as referred to in Sub-section (1), the Registrar or person authorized by him/her may cancel the registration of such association or society. (3) If, in holding inquiry pursuant to Sub-section (2) of Section 35 or making inspection pursuant to Section 36, any association or society is found remaining inoperative being failed to carry on any transaction for two consecutive years or any association or society is found to have acted contrary to its objectives, the Registrar or person authorized by him/her may cancel the registration of such association or society. In the event of such cancellation of registration, the association or society shall be dissolved and the certificate of registration shall ipso facto be void.

42. Appointment of liquidator:

(1) If any association or society is dissolved pursuant to Section 41, the Registrar or person authorized by him/her may appoint one liquidator to implement matters pertaining thereto.

(2) The functions, duties and powers and remuneration of the liquidator shall be as prescribed.

Chapter-11 Punishment

Chapter-11 Punishment

43. Imposition of fine for failure to submit information: A fine not exceeding One Thousand Five Hundred Rupees shall be imposed, by order of the Registrar, on any association or society which fails to submit a report pursuant to Section 34 or information as referred to in Sub-section (3) of Section 35.

44. Imposition of fine on person carrying on trade by using the word cooperative: A fine not exceeding Two Thousand Rupees shall be imposed, by order of the Registrar, on a person, other than an association or society registered pursuant to this Act, who carries on trade and business in violation of Section 46. If such person who has once been punished with fine is held to have again carried on trade and business in violation of that Section, such person shall be liable to a fine not exceeding Five Thousand Rupees for each instance following the second instance.

45. Appeal: The concerned association or society or person who is not satisfied with the cancellation of registration of such association or society made by the Registrar or person authorized by him/her pursuant to Sub-section (3) of Section 41 or with an order made by the Registrar pursuant to Section 43 or 44 may make an appeal to the Court of Appeal within thirty-five days.

Chapter-12 Miscellaneous

Chapter-12 Miscellaneous

46. Restriction on the use of word cooperative (or translation thereof): Any person, firm or organization, other than any association or society registered pursuant to this Act shall be entitled to carry on trade or business by adding the word cooperative (or its English translation) to its name.

47. Companies Act, 2021(1964) not to apply: The Companies Act, 2021 (1964) shall not apply to the association or society registered under this Act.

48. Powers to frame Rules:
(1) In order to implement the objectives of this Act, Government of Nepal may frame necessary Rules.
(2) Without prejudice to the generality of the powers conferred by Subsection (1), Rules may be framed particularly on the following matters: (a) Prescription of the format of application for the registration of the association or society and of certificate. (b) Making provisions on the powers and procedures of the general meeting and extra-ordinary general meeting of the association or society. (c) Provisions of financial source of the association or society and mobilization thereof. (d) Monitoring and supervisions of the association or society.

49. Repeal and saving:
(1) The Common Association (Sajha Snastha) Act, 2041 (1984) is hereby repealed.
(2) Any association or society registered under the Common Association (Sajha Snastha) Act, 2041 (1984) shall be deemed to have been registered pursuant to this Act.

CONSUMER PROTECTION ACT, 2054 (1998) Complete Book

CONSUMER PROTECTION ACT, 2054 (1998)

Date of Authentications and publication : 2054/10/15, (January 28, 1998)
1. Some Nepal Acts Amendment Act, 2055 2055/10/07(January 21, 1999)
2. Strengthening Republic and Some Nepal Laws Amendment Act, 2066 (2010) ACT NO. 20 OF THE YEAR 2054 (1998) Preamble: Whereas, it is expedient to make provisions for protecting consumers from irregularities concerning the quality, quantity and prices of consumer goods or services, ensuring that no one lowers or removes the attributes or usefulness of consumer goods or services, preventing circumstances in which monopolies and unfair trade practices may lead to an increase in prices, as well as false and misleading propaganda regarding the use and usefulness of consumer goods or services, selling, supplying, importing, exporting and storing safe and quality consumer goods or services, and protecting the rights and interests of consumers through the establishment of an agency for redressing the hardships of consumers, and thus maintaining the health, convenience and economic welfare of consumers,

Now therefore, the Parliament has enacted this Act in the 26th year of the reign of Majesty’s King Birendra Bir Bikram Shah Dev.

1. Short Title and Commencement : (1) This Act may be called “Consumer Protection Act, 2054 (1998).” (2) It shall come into force on Baisakh 1, 2055 (April 13, 1999).

2. Definitions : In this Act, Unless otherwise meant with reference to the subject or context;
(a) “Consumer” means an individual or institution consuming or using any consumer good or service.
(b) “Council” means the Consumer Protection Council formed under Section 3.
(c) “Compensation Committee” means the Compensation Committee formed under Section 23.
(d) “Consumer goods” mean goods or materials made through the admixture of several goods which are consumed or used by consumers and this term also includes raw materials, colours, flavors or chemicals used in the production of such consumer goods.
(e) “Service” means any labour, facility or consultancy provided for any work on payment of any kind of service charge or other consideration.
(f) “Production” means the process of producing, preparing, processing, converting, packing, repacking, assembling or labelling any consumer goods, or all or any process to be adopted in that connection.
(g) “Label” means a tag, symbol, picture or other descriptive objects written, printed, lithographed, symbolized, embossed, affixed or otherwise shown in consumer goods or their containers.
(h) “Unfair trade practices” means the sale or supply of consumer goods or services by making false or misleading claims about their actual quality, quantity, price, measurement, design, make etc., or the sale or supply of consumer goods produced by others by affecting their quality, quantity, price, measurement, design, make, etc.
(i) “Sub-standard consumer goods” means consumer goods of any of the following conditions:

(1) Consumer goods in which the quantity of an essential ingredient has been lowered, or any other material has been mixed, in such a manner that the quality falls short of the standard determined under Section 11.

(2) Consumer goods which are stale, rotten or stored or prepared in dirty or toxic conditions or in which any chemical, colour or flavour has been used, so that they become harmful to health.

(3) Consumer goods which are fully or partly made of any diseased or disease-generating animals or birds or harmful vegetation. (4) Consumer goods of a quality which falls short of the minimum necessary standard or exceeds the maximum standard prescribed, if any, in Act or in the orders issued under the Rules framed under Act.

(j) “Vendor” means an individual or a governmental or non-governmental organization or cooperative society selling and supplying consumer goods or services on a wholesale or retail basis.

(k) “Laboratory” means an institution which has been established with the objectives of testing the purity, completeness or quality of consumer goods, and which has been recognized by Government of Nepal.

(l) “Consumers Association” means an association established under prevailing law with the objective of protecting and promoting the rights and interests of consumers.

(m) “Inspection Officer” means an Inspection Officer appointed or designated under Section 14.

(n) “Prescribed” or “as prescribed” means prescribed or in the manner prescribed in the Rules framed under this Act.

3. Formation of Consumer Protection Council :

(1) A Consumer Protection Council shall be formed in order to formulate policies relating to the protection of the rights and interests of consumers, and offer suggestions to Government of Nepal on matters concerning the rights and interests of consumers. (2) The Council mentioned in Sub-Section

(1) shall comprise of the following Chairperson and members:
(a) Minister/Minister of State for Supplies – Chairperson
(b) …………
(c) Secretary, Ministry of Supplies – Member
(d) Secretary, Ministry of Industry – Member
(e) Secretary, Ministry of Agriculture – Member
(f) Secretary, Ministry of Home – Member
(g) Secretary, Ministry of Commerce – Member
(h) Director-General, Nepal Standards and Weights and Measures Department – Member
(i) President, Federation of Nepalese Chambers of Commerce and Industry – Member
(j) Three representatives nominated by Government of Nepal from non-governmental organizations associated with the rights and interests of consumers – Members (k) Two women representatives nominated by Government of Nepal from among women working in the fields associated with the rights and interests of the consumers – Members (l) An officer of Government of Nepal designated by Government of Nepal – Member-Secretary (3) Members nominated under Clauses (j) and (k) of Sub-section (2) shall have a tenure of two years, and may be re-nominated for one more term. (4) The Chairperson and members of the Council shall receive meeting allowances as prescribed by Government of Nepal.

4. Functions, Duties and Powers of the Council : (1) The functions, duties and powers of the Council shall be as follows: (a) To offer suggestions to Government of Nepal on matters relating to the protection of the rights and interests of consumers, the supply system and prices, quality and purity of consumer goods and services. (b) To disseminate or cause to disseminate information relating to the rights and interests of consumers in order to inform them about the standard of goods and services so as to protect them in matters concerning consumer goods and services. (c) To inform or cause to inform consumers about the prices, quality, quantity and purity of consumer goods and services, as well as about unfair trade practices concerning them. (d) To conduct or cause to conduct studies in connection with the protection of the rights and interests of consumers. (e) To offer suggestions to Government of Nepal on changing the existing policies or framing new policies relating to the protection of the rights and interests of consumers. (f) To maintain or cause to maintain updated national and international information relating to the protection of the rights and interests of consumers. (g) To monitor or cause to monitor the rights of consumers and offer suggestions to Government of Nepal to rectify the shortcomings noticed in the course of such monitoring. (h) To discharge or cause to discharge the functions prescribed by Government of Nepal. (i) To discharge or cause to discharge such other functions as are deemed appropriate for the protection of the rights and interests of consumers. (2) The Ministry of Supplies shall function as the Secretariat of the Council.

5. Procedures Relating to Meetings of the Council : (1)The Council shall meet on the date and at the time and place appointed by the Chairperson. (2) The quorum for a meeting of the Council shall be deemed to have been fulfilled in case it is attended by at least fifty percent of its total membership. (3) Meetings of the Council shall be presided over by the Chairperson, and, in absence, by a person chosen by the members from among themselves. (4) Decisions of the Council shall be authenticated by the MemberSecretary. (5) The other Rules of procedures of the Council shall be as determined by the Council itself.

6. Protection and Promotion of Consumer Rights : (1)For the purpose of protecting the rights and interests of consumers, every consumer shall have the following rights: (a) Right to be protected from the sale and supply of consumer goods and services which may harm life, body, health and property. (b) Right to be informed about the prices, attributes, quantity, purity, quality, etc. of consumer goods and services so as to be safe from unfair trade practices. (c) Right to be assured of an opportunity to choose consumer goods and services at competitive prices as far as possible. (d) Right to be assured that an appropriate agency will hear matters concerning the protection of the rights and interests of consumers. (e) Right to be heard and compensated against exploitation and grevances……. hardships resulting from unfair trade practices. (f) Right to consumer education. (2) Government of Nepal shall issue necessary directives to the Council in order to create an atmosphere favourable for the protection and promotion of the rights of consumers mentioned in Sub-Section (1).

7. Prohibition to Influence Demand, Supply or Price : No one shall influence the demand, supply and price of any of the consumer goods or services by taking any of the following actions in collusion with others: (a) By fixing the quota of raw materials needed for any of the consumer goods, or reducing the production of any of the consumer goods, or taking any other similar actions. (b) By hoarding any of the consumer goods or service or otherwise creating an artificial shortage, or selling and supplying such goods or services at specified times or places only, or taking any other similar actions.

8. Power to Systematize and Control Supply of Consumer Goods and Services:

(1) For the purpose of protecting the rights and interests of consumers, Government of Nepal shall exercise the following powers in order to systematize, control and regulate the supply of consumer goods and services:

(a) To formulate policies relating to the quality, price and the supply system of consumer goods or services.
(b) To formulate action plans in connection with the monitoring, prevention and control of unfair trade practices and monopolies which are likely to harm the rights and interests of consumers, and implement such plans.
(c) To analyze and review the situation in respect to the demand and supply of consumer goods consumed within the country.
(d) To make necessary arrangements for checking any undesirable increase in prices by producers, vendors or distributors of consumer goods.
(e) To discourage unfair trade practices which are likely to create shortages through artificial or other improper means.

(2) Government of Nepal shall make necessary arrangements in order to effectively implement the provisions concerning the protection of the rights and interests of consumers, regulation of the supply system, and control of the prices and quality of consumer goods and services.

9. Particulars to be Mentioned in Consumer Goods : A producer shall compulsorily mention the following particulars on the labels of consumer goods: (a) Name and address of the producer, and registration number of the industry. (b) In the case of consumer goods such as food and medicines, their ingredients as well as their quantity and weight. (c) Quality of consumer goods whose quality has been determined, if any. (d) Method of consuming consumer goods and possible impact of such consumption. (e) Price, batch number, production date and expiry date of the consumer goods. (f) In the case of consumer goods such as electronic goods, hardware and machinery, guarantee thereof, date of guarantee, and other necessary matters. (g) In the case of consumer goods which are inflammable, dangerous or fragile, precautions for their safety. (h) Other particulars as prescribed.

10. Prohibited Actions Regarding Consumer Goods or Services: No one shall take or cause to take any of the following actions in respect to any of the consumer goods or services:
(a) To produce, sell, supply, export or import a sub-standard consumer goods.
(b) To imitate any of the consumer good in such a manner as to mislead consumers.
(c) To sell or supply any of the consumer goods or services by making false or misleading claim that the consumer goods or services are separate one or by describing the substandard consumer goods or services as of higher standard.
(d) To engage in unfair trade practices in such a manner as to make false or misleading publicity or advertisements relating to the use, usefulness, or efficacy of any of the consumer goods or services.
(e) To produce, sell or supply any of the consumer goods or services which may cause harm to the health of the consumers’.
(f) To take such other actions as prescribed.

11. Standard of Consumer Goods or Services :
(1) In case the limits of the quality or quantity of any ingredient to be used in any of the consumer goods or services have been determined, Government of Nepal shall determine the standard of such good or service according to the prescribed procedures.
(2) Government of Nepal shall publish a notice of the determination of the standard of any of the goods and services under Sub-section (1) in the Nepal Gazette.

12. Price Lists to be Kept : Every vendor shall keep at a conspicuous place of shop a price-list of all consumer goods sold and supplied by him/her, explicitly mentioning its wholesale and retail prices.

13. Power of Government of Nepal to Conduct Inquiry and Inspections : (1) In case there is a reasonable ground to believe that any person is engaging in any unfair trading activity in such a manner as to adversely affect the rights and interests of consumers, or affecting the price and the supply system of the consumer goods or services by exercising a monopoly or through any other means, or producing or selling sub-standard goods, or taking any action which is contrary to this Act or the Rules framed hereunder, Government of Nepal may conduct or cause to conduct necessary inquiry and inspection.
(2) Government of Nepal shall take necessary action according to prevailing laws against any producer, dealer, agent, vendor, individual or institution found guilty through inquiry and inspection conducted under SubSection (1).

14. Power to Appoint or Designate Inspection Officer : Government of Nepal may appoint Inspection Officer or designate any officer to work in that capacity in the prescribed manner in order to monitor the supply of qualitative consumer goods or services to consumers in a simple manner and at fair prices by making the market and supply systems effective.

15. Powers of Inspection Officers to Inspect, Inquiry or Search : (1) In case, there is a reasonable ground to believe that any of the consumer goods or services which is not safe, efficacious or below the standard is being produced, sold or supplied, or that any action is being taken in violation of this Act or the Rules framed hereunder, at any place, the Inspection Officer may inspect, conduct inquiry or search such place. (2) In case, it is found in the course of an inspection, inquiry or search conducted under Sub-section (1) that any of the goods or services which is not safe, efficacious or below the standard is being produced, sold or supplied, or that actions are being taken in violation of this Act or the Rules framed hereunder, the Inspection Officer shall take a sample of such goods (or service) in the prescribed manner and impose a ban on the production and sale or supply of such goods or services for a prescribed period. (3) Reports of actions taken by the Inspection Officer under Sub-section (2) shall be submitted to Government of Nepal within three days. (4) The procedures to be adopted by the Inspection Officer while conducting inspection, inquiry or search shall be as prescribed. (5) The other functions, duties and powers of Inspection Officer, and provisions concerning the implementation of the reports submitted by them, shall be as prescribed.

16. Testing of Consumer Goods : Samples of consumer goods taken by an Inspection Officer under Section 15 shall be sent to the laboratory for a test within the prescribed time-limit.

17. Sub-Standard Consumer Goods to be Confiscated: In case any of the consumer goods is found to be of sub-standard following the test of its sample at the laboratory where it is sent under Section 16, it shall be confiscated.

18. Penalties : A person who commits or cause to commit the following Act shall be punished as follows, depending on the degree of offense:

(a) A person who commits or cause to commit any Act in violation of Section 7 shall be punished with an imprisonment for a term not exceeding three years, or with a fine not exceeding Fifty Thousand Rupees or with both.

(b) A person who commits or cause to commit any Act in violation of Clause (a) of ∝ ………..Section 9 shall be punished with imprisonment for a term not exceeding two years, or with a fine not exceeding Thirty Thousand Rupees or with both.

(c) A person who commits or cause to commit any Act in violation of Clause (a) of Section 10 shall be punished with imprisonment for a term not exceeding three years, or with a fine not exceeding Fifty Thousand Rupees or with both.

(d) A person who commits or cause to commit any Act in violation of Clauses (b), (c) and (d) of Section 10 shall be punished with imprisonment for a term not exceeding five years, or with a fine not exceeding One Hundred Thousand Rupees or with both.

(e) A person who commits or cause to commit any Act in violation of Clause

(e) of Section 10 shall be punished as follows: (1) If there is a threat to life, for a term not exceeding fourteen years, or with a fine not exceeding Rs 500,000, or with both. (2) In case the strength of any organ of the body is likely to be reduced or lost, with imprisonment for a term not exceeding ten years, or with a fine not exceeding Rs 500,000, or with both. (3) In other circumstances, with imprisonment for a term not exceeding five years, or with a fine not exceeding Rs 300,000, or with both.

(f) Any person who takes or instigates others to take any action, other than those mentioned above, which violates tact or the Rules framed under this Act shall be punished with imprisonment for a term not exceeding two years, or with a fine not exceeding Rs 200,000, or with both.

19. Government of Nepal to be the Plaintiff : Government of Nepal shall be the plaintiff in cases under this Act.

20. Investigation and Filing of Lawsuits : (1) Lawsuits relating to offenses punishable under this Act shall be investigated by Inspection Officers and lawsuits shall be filed with the concerned District Court within 35 days from the date of completion of such investigations. (2) While investigating and filing lawsuits under Sub-section (1), an Inspection Officer may seek the opinion of the Government Attorney, and such cases shall be defended by the Government Attorney.

21. Summary Trial Procedure to be Adopted : The procedure mentioned in the Summary Procedure Act, 1972 shall be adopted in the process and disposal of lawsuits filed under this Act.

22. Claims for Compensation May be Made: In case any consumer suffers a loss or damage of any kind as a result of the sale of any consumer good or service contrary to this Act, such consumer, or any Consumer Association on behalf, may file a complaint with the Compensation Committee within 35 days from the date of such loss or damage, requesting for the realization of compensation from the person who has sold or supplied such consumer good or service.

23. Compensation Committee :

(1) A Compensation Committee as follows shall be formed in each district in order to conduct inquiry into complaints filed under Section 22 and realize compensation in consideration of losses or damages suffered by the consumer:

(a) Chief District Officer – Chairperson
(b) District Attorney – Member
(c) District Medical Officer – Member
(d) A representative of the District Consumers Association designated by Government of Nepal – Member
(e) Representative, District Chamber of Commerce and Industry – Member
(f) An officer designated by Government of Nepal – Member-Secretary

(2) The Compensation Committee shall take a decision on a complaint filed in connection with compensation within the prescribed time-limit. The working procedure to be followed while taking decision shall be as prescribed.

24. Realization of Compensation : In case the Compensation Committee holds that a consumer has suffered a loss or damage following inquiry into a complaint filed for compensation under Section 22, it shall arrange for the payment of compensation on the basis of such loss or damage to the concerned consumer or heir.

25. Appeal : Any person who is dissatisfied with the decision taken by the Compensation Committee under Section 24 may file an appeal with the concerned Appellate Court within 35 days from the date of such decision.

26. Power to Initiate Lawsuits Under the Prevailing Laws : In case any action which is an offense under this Act is also an offense under any other prevailing Nepal Law, this Act shall not be deemed to have prejudiced the right to initiate lawsuits under any other law.

27. Power to Form Sub-Committees: (1) Government of Nepal or the Council may form necessary Sub-Committees in order to fulfill the objectives of this Act. (2) The functions, duties, powers and procedures of a Sub-Committee formed under Sub-Section (1) shall be as prescribed by Government of Nepal or the Council.

28. Delegation of Powers: Government of Nepal or the Council may delegate some of the powers vested in it under this Act to any Sub-Committee formed under Section 27, or to any officer as it requires.

29. Immunity for Actions Taken With Bona fide Motives : Inspection Officers, Compensation Committee or employee of the Government of Nepal shall not be held personally liable for any action taken by him/her with good intentions in the course of fulfilling their duties under this Act or the Rules framed hereunder. 30 Power to Frame Rules : Government of Nepal may frame necessary Rules in order to implement the objectives of this Act.

Chapter -1 Preliminary

An Act Made to Provide for legal provisions on contract

Preamble : Whereas it is expedient to update legal provisions concerning contract; Be it enacted by the Parliament in the 20th year of the reign of His Majesty the King Birendra Bir Bikram Shah Dev.

Chapter -1

Preliminary

1. Short Title and Commencement: (1) This Act may be called Contract Act, 2056 ( 2000) ‘.

(2) It shall come into force immediately.
2. Definitions: Unless the context otherwise requires; in this Act;

  1. (a)  ‘Contract’ means an agreement enforceable by law concluded between two or more parties for performing or not performing any work.
  2. (b)  ‘Proposal’ means a proposal presented by one person to another with the intent of obtaining his/her consent to do or not to do any work.
  3. (c)  ‘Consent’ means the consent given by the person to whom a proposal has been presented in the same meaning of that offer.
  4. (d)  ‘Consideration’ means the promise made to do or not to do

any work in return of doing or not doing of any work mentioned in the proposal.

Chapter- 2

Chapter- 2

Contracting Parties and Proposal and Consent

3. Person competent to Conclude Contracts :

(1) Any person other than those mentioned below may be competent for concluding a contract;
(a) Those who have not attained 16 years of age.
(b) Those who are of unsound mind.
(2) Notwithstanding anything contained in Sub-section (I) any person not qualified to enter into a specific contract under the prevailing law shall be deemed to be incompetent to conclude that contract. ,
(3) The guardian of a person who is incompetent to conclude a contract under Section 1 may conclude a contract on his/her behalf in his interest.
(4) Notwithstanding anything contained elsewhere in this Section, in case the prevailing law provides for a provision even to persons who are incompetent under this Act to conclude a contract on any specific matter, they shall be deemed to be qualified to conclude a contract on such that matter accordingly.

4. Parties to be autonomous : The parties to contract, subject to this Act shall be free to choose the form and content of contract and to determine consideration and its quantum, the terms and conditions of the contract and the nature of the remedy in the event of its violation, as well as to determine the measures for resolving disputes under the contract.

5. Contract to be deemed to have been concluded : A contract shall be deemed to have been concluded once the person to whom a proposal has been presented by another person communicates his/her consent thereto.

6. Place of contract :

(1) The place where the person advances a proposal expecting to receive consent shall be deemed to be the place where the contract has been concluded
(2) In case the place has not been specified under Sub-section (1), the place where the offerer received consent shall be deemed to be the place where the contract has been concluded.

7. Processes of proposal and consent to be deemed completed:

(1) The communication of a proposal shall be deemed to be completed when it comes to the knowledge of the person to whom it is made.
(2) In case the offerer receives a notice of consent to the sent to him/her by the person to whom he/she had sent a proposal, the process of consent shall be deemed to have been completed in the case of the offerer, and in case the offerer is noticed that the consent has been given in the proposal the process of giving consent shall be deemed to have been completed in the case of the proposed person.
(3) The person who has been presented with a proposal shall be deemed to have given his/her consent to it even if he/she has not done it directly to the offer in case he/she compiles with the term and conditions mentioned in the proposal, or accepts any consideration, benefit or service mentioned in the proposal or expresses his/her consent in any other form.
(4) In case the offerer has mentioned in the proposal that he/she would deem the proposal to have been accepted unless he receives a notice of refusal within a specified period, the proposal shall not be deemed to have been accepted in case a notice of refusal has been sent within that- period.

8. Proposal or Consent may be cancelled :

(1) The offerer may cancel his/her proposal through a notice. Provided that, in case the offerer has received from the person whom he has presented a proposal a notice to the effect that he/she has approved the proposal before receiving a notice of the cancellation of the proposal, the proposal shall not be deemed to be cancelled.
(2) The person to whom, a proposal has been presented may cancel proposal through a notice. Provided that, the consent shall not be cancelled in case the offerer
has received the notice of consent before receiving the notice of cancellation of consent.
(3) The person who has sent a notice expressing his/her refusal of a proposal may again send a notice expressing his/her consent to the proposal. Provided that, in case the notice of refusal reaches first out of the notices of refusal or consent the contract shall not be deemed to have been concluded. In case the notice of consent reaches first; the contract shall be deemed to have been concluded.
(4) In case the notice mentioned in Sub-section (1) has been sent after sending the proposal, or the notice mentioned in Sub-section (2) has been sent after sending a notice of consent, or in case a notice has been sent under Sub-section (3) after sending a notice of refusal shall not be deemed to have been concluded if the concerned person receives such notices at the same time.

9. Proposal to be deemed cancelled: A proposal shall be deemed to be cancelled in any of the following circumstances:
(a) In case the offerer has proposed that the notice of consent to the proposal be given to him/her within a specified period, and the offerer does not receive the notice of consent given by the person to whom the proposal has been presented within the period.

(b) In case the period for sending a notice of consent is not specified as mentioned in Clause (a), and the person to whom the proposal has been presented does not furnish a notice to the proposer within a reasonable period.
(c) In case the offerer dies or loses his senses before receiving consent after presenting the proposal.
(d) In case the proposal is cancelled as mentioned in Section 8.
(e) In case the person to whom a proposal has been presented dies or loses his/her senses after giving his/her consent but before the offerer receives the consent.
(f) In case the person to whom a proposal has been presented accepts it after altering any particular contained in the proposal or attaching any condition thereto.
(g) In case a proposal has been presented subject to the condition that the person to whom the proposal has been presented has to do anything or fulfill any condition before accepting the proposal, and her/she accepts the proposal without doing that work or fulfilling that condition.

10. Contract according to proposal presented before the public :

(1) In case any person, by means of an advertisement, advances a proposal in public to the effect that he/she will pay a specific prize or any person for performing any work specified in the advertisement, and incase any perso  the work as mentioned in the advertisement, the advertiser shall pay the specific remuneration to that person.
(2) In case the work mentioned in Sub-section (2) is performed by one or more persons, only the person who has performed the work first shall be paid prize. Provided that, in case two or more persons have performed the work mentioned in the proposal at the same time, all of them may share the prize among themselves. In case the prize can not be shared, the proceeds of the sale of the same shall be equally distributed among them.
(3) In case a specific period has been prescribed for performing the work as per the advertisement published under Sub-section (1), the proposal, mentioned in the advertisement shall be deemed to have been cancelled immediately after the expiry of that period.
(4) A proposal advanced under Sub-section (2) may be cancelled through the medium through which it was published.
(5) Notwithstanding anything contained in Sub-section (4), in case anyone has, performed the work mentioned in the advertisement published under Sub – section (1) before the publication of a notice of cancellation of the proposal, he/she shall be paid the prize mentioned in the advertisement. Provided that, the person who has performed the work as mentioned in the advertisement must have notified the advertiser about the completion of the work by the quickest possible means.
(6) In case any person has begun the work according to the advertisement published under Sub-section (1) and furnished a notice thereof to the advertise, he/she shall be paid an appropriate remuneration for the work, performed by him/her before the cancellation of the advertisement.
11. Indirect contract : Notwithstanding anything contained elsewhere in this act, a contract shall be deemed to have been concluded as follows in the following circumstances:
(a) In case a person who is incompetent to conclude a contract under this Act or other prevailing Nepal law, or any other person who is to be maintained by him/her is provided with any material, commodity or service which material commodity service paid from the property of such he/she needs and that is consistent with his social status, to have the cost of such person to the person so meeting his/her need.
(b) In case any person, who is concerned with the payment or non- payment of any amount to be paid by another person under the prevailing Nepal law makes such payment him/herself, to have that payment repaid to him/her from the property of the person who is actually under obligation to make the payment.
(c) In case any person gives anything to another person, or employs him/her in any work, to pay the appropriate cost or remuneration.
(d) In case any person keeps under his/her personal possession any property belonging to another person that may be kept as such under the law, to keep that property as a bailment property.
(e) In case any person pays any amount (to any person) by mistake, to refund the same.

12. Contingent contracts :

(1) In case a contract has been concluded to performing or not to perform any work if any event happens in the future, the contract shall not create any liability until such event happens.
(2) In case a contract has been concluded subject to the condition that it shall be deemed to have been concluded in case person performs any specified work in the future, no liability shall be deemed to have emerged from that contract if such person does anything in such a manner as not to perform that work or acts in such a manner that the work can not be performed.
(3) In case a contract has been concluded to perform or not to perform any work if any uncertain event does not happen in the future, liability under that contract shall emerge only after the happening of that event becomes impossible.
(4) In case a contract has been concluded with a provision to perform or not to perform any work if any event happens within a specified period in the future, the contract shall be deemed to have become invalid after the happening of that event becomes impossible within the specified period or after the expiring of that period.
(5) In case a contract has been concluded with a provision to perform or not to perform any work if any event does not happen within a specified period in the future, liability under such contract shall emerge if that event does not happen within that period or if it becomes certain that the event will not happen within that period.

Chapter : 3

Chapter : 3

Void and Voidable Contracts

13. Void Contracts : The following contracts shall be void:

(a) A Contract preventing anyone from engaging him/herself in any occupation, profession or trade which is not prohibited by prevailing law. Provided that a contract shall not be deemed to have been concluded in preventing profession or trade in the following circumstances:
(1) A contract preventing the seller from engaging him/herself in a profession or trade at the time and place as mentioned in the contract concluded between the buyer and the seller on selling and buying of the goodwill of any trade;
(2) A contract concluded among partners in preventing their engagement in any trade or business, other than those of the partnership firm, similar to those of the partnership firm or any other trade or business together with other competitors belonging to the same kind of trade or business as long as the partnership continues.
(3) A contract concluded among the partners in preventing them from engaging in a trade or business under the partnership firm for the specified time or place after being separated from the partnership;
(4) A contract preventing any individual from receiving the service of any such agency, company, firm, individual or competitor of such agency, company, firm, or individual for the specified period of time after the retirement from service or during the service of such agency, company, firm or
individual pursuant to contract concluded by any individual with any agency, company, firm or individual.
(b) A contract restraining marriages other than those prohibited by the prevailing law.
(c) A contract preventing any one from enjoying the facilities already being enjoyed by the general public.
(d) A contract seeking to prevent the legal rights of any person from being enforced by any government office or court.
(e) A contract concluded in matters , contrary to or prohibited by the prevailing law.
(f) A contract concluded for immoral purpose or against Public morality or public interest.
(g) A contract which cannot be performed because the parties thereto do not exactly know about the matter in relation to which it has been concluded.
(h) A contract which is considered impossible to fulfill even at the time is concluded.
(i) A contract which is vague as it does not provide reasonable meaning thereof.
(j) A contract concluded by an incompetent person to conclude such contract.
(k) A contract concluded with an unlawful consideration or objective.

14. Voidable Contracts :

(1) The following contracts may be made void by the aggrieved party:
(a) A contract concluded through coercion: Explanation A person shall be deemed to have indulged in coercion if he/she, with the objective of compelling any person, to accept any contract against his/her will, withholds or threatens to withhold property belonging to him/her, or threatens to defame him/her, or takes or threatens to take any other action in contravention of prevailing law.
(b) A contract concluded through of undue influence: Explanation
(1) Undue influence means influence exercised by a person upon another person who is under his/her influence and is amenable to his/her personal benefit
or interest.
(2) Without prejudice to the generality of Clause (1), the following persons shall be deemed to be under the influence of any person and amenable to his/her
wishes:
(i) A person living under his/her guardianship, protection or custody.
(ii) a persons who cannot take care of their interest temporarily or permanently by reason of old age, sickness or physical or mental weakness.
(iii) A person who can be subjected to under one’s economic or ranking influences.
(c) A contract concluded through fraud: Explanation A party to the contract or his/her agent shall be deemed to have committed fraud if he/she, leads the other party or his/her agent to believe or takes any action to believe the particular matter is true, although he/she knows that it is false, or suppresses any information in his/her possession, or indulges in any other fraudulent act punishable under prevailing law, with the intention of deceiving the opposite party or his/her agent.
(d) A contract concluded through deceit: Explanation
(1) Any of the following act shall be taken as deceit:
(i) Submission of false particulars on any matter without reasonable basis for doing so;
(ii) Misleading any party so as to aggrieve him/her;
(iii) Causing any wrong deliberately on the matter of contract;
(2) In a case of a voidable contract under this section, the following matters shall be dealt with as prescribed below:
(i) The party caused to enter into a contract may, instead of making the contract void, demand his/her position to be remained the same, as it was prior to conclusion of the contract.
(ii) Burden of proof of innocence of undue influence shall be rest in the party who claims that such contract is not concluded under an undue influence in case a contract is concluded with the person who is under one’s influence and amenable to his/her wishes

Chapter- 4

Chapter- 4 :

Contracts relating to Guarantee, Indemnity and Subrogation

15. Contracts relating to guarantee :

(1) A contract relating to guarantee shall be deemed to have been concluded in case it provides that if any person defaults in the repayment of the loan obtained by him or fulfillment of the obligation accepted by him/her, it shall be repaid or fulfilled by a third person.
(2) In case a third party has provided guarantee under Sub-section
(1) and in case the person who has to repay the loan does not repay it or fulfill the obligation to be fulfilled, the person guaranteeing such loan or obligation shall repay the loan or fulfill the condition according to the contract.
(3) Contract relating to guarantee must have been concluded in writing.

16. Surety’s liability : Except when otherwise provided for in the contract, the surety’s liability shall be as follows:
(a) Liability of the surety shall emerge from the very time when the person who has to meet the liability fails to meet it.
(b) Liability of a surely shall be similar to that of the person who has to repay the loan or fulfill any obligation. The surety shall remain responsible until the person becomes free from the liability of repaying the loan or fulfilling the obligation.
(c) The creditors may impose the surety with the liability immediately after the default by the person who is under obligation to repay the loan or fulfill the obligation.
(d) In case both security and guarantee have been provided in consideration of any loan or liability, the surety shall have no liability to the extent covered by the security so provided.
(e) The liability of a surety shall not terminate simply because the person who has to repay the loan or fulfill the liability becomes free from the liability through the mobilization of law. Explanation For the purpose of this Act, the term ‘creditor’ shall denote a person who has supplied the loan and this term also includes a person who may obtain any benefits from or have any work done by the person who has to repay the loan or fulfill the liability.

17. Circumstance in which surety will be free from liability :

(1) Except when otherwise provided for in the contract, the surety shall be free from liability to the extent as mentioned in any of the following circumstance:
(a) In case the person who has to repay a loan or fulfill a liability changes the terms and conditions of the contract in such a  way as to have a substantial impact on the contract without the approval of the surety, in respect to the transaction to be carried out after such changes.
(b) In case a contract is concluded to absolve from liability to the person who has to fulfill the concerning matter in respect to which the guarantee has been provided.
(c) In case the person who has to repay a loan or fulfill a liability is absolved from liability, or in case the loan is waived, due to the action of the creditors.
(d) In case the creditor agrees to absolve the debtor from the liability by collecting a sum less than what is due, or to provide additional time limit for repaying the loan, or not to initiate a lawsuit.
(e) In case any action of the creditors causing an adverse impact to the surety’s right to legal remedy against the person who is under obligation to repay the loan or fulfill the liability.
(f) In case the creditor loses, damages or returns any security obtained by him from the debtors, to the extent of the value of that security.
(g) To the extent to which the person who is under obligation to repay a loan or fulfill a liability has repaid the loan or fulfilled the liability according to the contract.
(2) Notwithstanding anything contained in Sub-section (1), the surety shall not be deemed to have been absolved from the liability, except when otherwise provided for in the contract, simply because the creditor fails to initiate legal action against the surety or try to realize the amount to be realized by him/her in time.
(3) In case there are two or more sureties, and in case the creditors absolves any one of them from the liability, the other surety/sureties shall not be free from his/her/their share in the liability. In case the share in the liability of the surety/sureties can not be separated, no surety shall be deemed to have been absolved from his liability simply because; the creditor has absolved him/her from the liability.
(4) In respect to a contract relating to guarantee which concerned with the fulfillment of a liability, the surety shall not be deemed to have been absolved from the obligation of fulfilling the liability under the contract simply because a dispute has arisen among the parties in relation to that contract, except when otherwise provided for in the contract.

18. Relationship between the Surety and the Debtors : Except when otherwise provided for in the contract, the relationship between the surety and the debtors in respect to the following matters shall be as follows:
(a) The surety shall cause a person who is under obligation to repay a loan or fulfill a liability according to the contract.
(b) In case the debtor has supplied any property or security to the surety in consideration of the guarantee provided by him/her while obtaining the loan or accepting a liability, the surety may not mortgage, sell, or otherwise transfer the title, thereto without the consent of the debtor.
(c) In case a guarantee has been provided in consideration of any loan obtained or liability accepted for any specific purpose, the objectives, nature or terms and conditions of that loan or liability may not be changed without the consent of the surety.

19. Surety to substitute creditor :

(1) After the surety repays the loan to be repaid by the debtor or fulfills the liability to be fulfilled by the debtors under the contract, the surety shall substitute the creditor in regard to that loan or liability, and may initiate legal action against the debtor like a creditor under this Act or prevailing law.
(2) Notwithstanding anything contained elsewhere in this chapter, the total amount and interest due on that amount, or any other fee or amount payable on that, shall be paid by the debtors to the surety in consideration of the loan repaid or liability fulfilled by the surety on his behalf according to the contract relating to guarantee.
(3) In case it becomes necessary to take legal action because of the failure the debtor to pay the amount payable by him/her under Sub- section (2), or in case it becomes necessary to incur any other expenses in consideration of the surety may have such expenses recovered from the debtor.

20. G uarantee related viable contract : The surety may cause to declare void the contract relating to guarantee in the following circumstances:
(a) In case the creditors him/herself, or any other person with his/her consent, has obtained the guarantee by supplying wrong or misleading information or notice to the surety in connection with the matter connected with the transaction in respect to which the guarantee has been provided;
(b) In case the subject matter, property (cash or kind) involved or facts relating to guarantee have been concealed or not mentioned:
(c) In case the contract has been concluded with a provision a third person as a surety, and the third person has not given his/her consent to provide the guarantee.

21. Equal liability of co-sureties :

(1) In case two or more person have jointly or separately provided joint guarantee for any loan or liability, and in case the debtor fails to repay the loan or meet the liability, the co-sureties shall repay the loan or meet the liability or the requirements of the contract on an equal basis, except when otherwise provided for in the contract.
(2) In case the guarantee has been provided on a sector wise basis while providing joint guarantee under Sub-section (1), a surety shall be required to meet only the liability for that sector for which he/she has provided the guarantee.

22. Contract relating to indemnity :

(1) In case person has entered into a contract relating to indemnity with a provision to pay any party to a contract or a third person for any loss or damage that may result from his/her actions while working under the direction of that party to that contract, he/she may realize as compensation all or any of the following amounts, subject to that contract:
(a) The indemnity amount mentioned in the contract;
(b) In case any loss or damage has been caused to a third person, the amount to be paid or borne in consideration thereof;
(c) The amount spent on the case filed or defended by him/her in connection with the contract relating to indemnity;
(d) The amount spend on the legal action, if it becomes necessary to initiate such action for failure to pay the amounts mentioned in Clause (a) to (c).
(2) Notwithstanding anything contained in Sub-section (1), in case any person, while working under the direction of the other party, works negligently or with the intention of causing any loss or damage to that party or a third person, and in case the concerned party or the third person suffers a loss damage as a result thereof, he/she shall him/herself be responsible for such loss or damage.

23. Provision concerning subrogation :

(1) In case any person has concluded a contract with any other person against any loss or damage that could be caused by a third person to his/her property, facilities, rights or profits that could result from his/her business, the other person who has signed the contract shall him/herself bear any such loss or damage
irrespective of who is responsible. Provided that, in case the contract has been signed with a provision to have any such loss or damage borne by any other person, such loss or damage shall be realized from that person. (2) In case the amount or compensation to be paid for any loss or damage under Sub-section (1) has been mentioned in the contract, it shall be done accordingly and in case no such provision has been made in the contract, an appropriate amount or compensation shall be paid, or arrangements be made for payments, to the person affected by the loss or damage, or to his/her heir in case he/she is dead. (3) In case there has been any loss or damage as mentioned in Sub-section (1), the person paying the amount or compensation under Sub- section (2) shall be deemed to have subrogated the person who has sustained the loss or damage, and, accordingly, the subrogator may have the amount or compensation in consideration of such loss or damage recovered from the person causing such loss or damage.

24. Rights of subrogator : The rights and liabilities of a subrogator shall be as mentioned in the contract, if any, and if not, it shall be as follows:
(a) All the rights of the person who has sustained the loss or damage shall devolve on the subrogation.
(b) The subrogator mentioned in Clause (a) may realize from the person who has caused the loss or damage, or from the party to a contract concluded in that connection, if any, the amount or reasonable compensation paid by him/her to the person who has suffered the loss or damage, as well as the expenses incurred in
contesting a case, if any

Chapter- 5

Chapter- 5:

Contracts Relating to Bailment

25. Contract relating to Bailment: A contract relating to bailment shall be deemed to have been concluded in case any person delivers any property to another person on a returnable basis or for handing it over to any other person or selling it as ordered by him/her. Provided that, a deed must be execute while bailing any property wort more then Rs.5,000.00 Explanation: For the purpose of this chapter, the term ‘property’ includes any movable property and title to such property.

26. Process of bailment to be deemed completed :

(1) The process of bailment shall be deemed to have been completed after the bailee receives the bailment property for being kept as such.
(2) In case any property is already being kept by any person or a person authorized by him/her under his/her custody or control, the concerned property shall be deemed to have been taken by him/her as a bailed property.

27. Particulars of bailed property to be mentioned:

(1) In case the bailee knows that the bailed property must not be used due to any defect in it, or because it could cause any loss or damage or because separate
arrangements or provisions be made for its protection, he/she shall inform the bailee about all such matters to the best of his/her knowledge.
(2) In case any information to be supplied under Sub-section (1) is not supplied even while knowing about it, the bailer must bear the loss or damage caused by that property or because of that property to the bailee.
(3) Notwithstanding anything contained in Sub-section (1), in case : any property given on rent or as collateral or for sale causes any loss or damage while using it due to its defect, the bailer must bear such loss or damage even if he/she has no knowledge about the defect in the property.

28. Bailee’s liability :

(1) A bailee shall look after and arrange for the safety of the property received by him/her as bailed property as mentioned in the terms and conditions of the contract, or as his/her own property in case nothing has been mentioned in the contract.
(2) Except when otherwise provided for in the contract, in case any bailed property depreciates or is lost, stolen, damaged, destroyed, decreased or harmed because of a natural calamities despite taking care and arranging for its security under Sub-section (1), the bailee need not return such property. Provided that, in case the property is depreciated or is lost, stolen, damaged, destroyed decreased or harmed because of the negligence or malfide intention of the bailee, or of his/her failure to take care or ensure its safety according to the terms and conditions of the contract, he/she must return the property or pay an equivalent amount to the bailer.
(3) In case the bailee uses the bailed property without having the right to do so under the contract or in a manner contrary to the terms and conditions of the contract, and in case such use causes any loss, damage, destruction, depreciation or harm to the property, the bailee shall pay for compensation to the bailer.
(4) Except when otherwise provided for in the contract, the bailee shall not mix-up the bailer’s property with his/her own property. Provided that, in case the bailee has mixed-up his/her own property with that of the bailer, both parties shall have title on that property, as well as to the income accruing there from, in proportion to their respective shares.
(5) In case the bailee has mixed-up his/her own property with the bailer’s property and the property so mixed-up can be separated, the two parties shall have title to their respective property so separated, and the expenses incurred for separating the property so mixed and the loss, if any caused, to the bailer while mixing-up such property in that manner shall be borne by the bailee.
(6) In case the bailee has mixed-up his/her own property with the bailer’s property without the consent of the bailer and their property cannot be separated as mentioned in Sub-section (5), the title of the bailer to the bailee’s property shall terminate if he/she agrees to obtain his/her share from the property so mixed-up. In case the bailer does not agree to take his/her share from such property the bailee shall be required to pay compensation for his/her property.

29. Bailed property to be returned:

(1) After the expiry of the , period prescribed while bailing a property or fulfillment of the objectives with which the property has been bailed, the bailee shall return the bailed property to the bailer.
(2) In case the property is not returned under Sub-section (1) within the prescribed period, or within a reasonable period according to the nature of the property where no such period has been prescribed, or in case the bailer does not take it back and the property is lost, stolen, damaged, destroyed or reduced after that date or bailer suffers any loss or damage due to that property after that date the party because of which the loss or damage has resulted shall bear the loss or damage.
(3) Except when otherwise . provided for in the contract, in the case of a bailed property owned by several persons, it may be handed over to any one of such owners or to the person ordered by them, and the hand over of the property in that manner shall be deemed to have been done duly.
(4) Except when otherwise provided for in the contract, the property raised or earned through the bailed property shall also belong to the bailer.

30. Person bailing other’s property to be held responsible : In case any person bails any property on which he/she has no title, right or ownership to any other person to keep as a bailed property, and the bailee has to bear any claim of a third party or any loss, damage or any expenses in for accepting that bailment the bailer shall be required to bear such expenses as well.

31. Found property may be kept after notifying the police : In case person finds any property in any way, he/she may keep it safely with him/herself until the concerned owner is found out after notifying the police. The expenses incurred for finding out the owner of the property and for keeping the property shall be borne by the concerned owner, and the person who has found the property may keep it with him/herself until the owner pays such expenses.

32. Property given for repair and maintenance to be returned :

(1)In case person has given any property for repair, improvement or renovation in any way to any person, the latter shall return it to the former after
collecting expense or service charge fixed for repair, improvement or renovation.
(2) The property handed over under Sub-section (1) sha1I be returned to the concerned owner after repairing, improving or renovating it within the period mentioned in the contract. In case it is not returned within the prescribed period, or any additional loss or damage is caused to the property or the property is damaged in such a way as to become unusable in the course of repair, improvement or renovation, action shall be taken as provided for in the contract, and if no provision has been made in the connection in that contract, an appropriate compensation shall be paid to the concerned owner.
(3) Notwithstanding anything contained elsewhere in this Section, the person repairing, improving or renovating any property may keep it with him/herself until the cost of repair, improvement or renovation or the service charge fixed for that purpose is paid. In case the cost or service charge is not paid within a reasonable period, the person repairing, improving or renovating the property may recover his/her expenses or service charge by selling the property,

33. Bailment Expenses : While bailing a property, expenses incurred for looking after and ensuring the safety of the bailed property shall be borne by the bailer, except when otherwise provided for in the contract.

34. Contract relating to bailment to be void:

(1) In case it is proved that any property has been bailed with the intension of avoiding a partition of property or payment of any government charge or any amount involved in any claim or to be paid to anybody, or with any other illegal motives, the contract relating to such bailment shall be void. In case the bailee does not keep the bailed property according to the term and conditions of the contract, the bailer may get back the bailed property at any time.

Chapter -6

Chapter -6

Contracts relating to Collateral and Deposit

35. Contracts relating to collateral or deposit :

(1) In case any person has obtained a collateral while supplying credit to anybody as a security for that credit, or obtained any property as a deposit in the form of a guarantee to perform the concerned work while having any work performed a contract relating to collateral or deposit shall be deemed to have been concluded. Explanation: For the purpose of this Chapter, the term ‘property’ shall denote any movable or immovable property , and title or document establishing title to that property.
(2) In case a collateral has been obtained while supplying a credit, the credit and interest thereon, and incase any deposit has been obtained to perform any work the other expenses relating to that work, as well as the expenses incurred for looking after the collateral or deposit, shall also be deemed to have been included in the contract relating to collateral or deposit.

36. Collateral or deposit to be returned:

(1) Except when otherwise provided for in the contract, the collateral obtained for a credit shall be returned after the repayment of the credit, or the deposit obtained for a work shall be refunded to the concerned person after the completion of that work.
(2) In case the collateral or deposit kept under Sub-section (1) has been or can be divided into different parts, the collateral or deposit may be returned to the extent covered by the portion of the credit repaid or work performed.

37. Rights of person obtaining collateral or deposit :

(1) In case a credit has been obtained by pledging any property as collateral and the debtor fails to repay the credit or interest thereon, if any, within the prescribed period, the person who has taken the collateral may initiate action according to , law and realize the amount to be realized in consideration of that credit by selling or auctioning the collateral according to current market price or transfer the title to such collateral subject to law in case it can not be sold or auctioned.
(2) In case the property kept as collateral is sold at a price lesser than the amount to be realized from the debtor by the person who has the collateral under Sub-section (1), the shortfall may be recovered form other assets of the debtors. In case the collateral is sold at a price higher than the amount to be recovered, the excess amount shall be refunded to the debtors.
(3) Notwithstanding anything containing in Sub-section (1) and
(2), in case the property kept as collateral has not yet been sold or the title to it has not yet been transferred, the person who has pledged the property as collateral may clear his property by repaying the credit and interest thereon and any other amount payable at any time. Provided that, the person pledging the property as collateral shall also bear the additional liability emerging on the property kept as collateral owing to his failure to repay the amount within the stipulated period.
(4) In case anyone has been entrusted with the responsibility of performing any work by obtaining any property as deposit, and the concerned person fails to complete the concerned work or the concerned work fails to be completed within the stipulated period, the property kept as deposit may be used to complete the work or to recover the expenses incurred thereupon. In case the work can not be completed with the property kept as deposit, the amount in shortfall may be recovered from the other assets of the person who has furnished the deposit.

38. Consequences of pledging property without sufficient title as collateral or ‘deposit :

(1) In case anyone has obtained a credit or work by pledging as collateral or depositing any property to which he/she has no title or ownership or any property received under a contract which is void under this Act, and the person obtaining such collateral or deposit has no knowledge about the matter, the latter may demand the property from the ….. to which the he/she has a title so as to be kept as collateral or deposit. In case the former fails to provide such collateral, the latter may cause the contract to be void.
(2) In case any property received under a void contract has been pledged as collateral or deposit, and such contract had become void before furnishing such collateral or deposit or the party receiving the collateral or deposit know that the concerned property did not belong to the person furnishing it as collateral or deposit, the person obtaining such property as collateral or deposit shall have no right to it and may realize the amount to be realized by him/her or have the work to be performed from the other property of the party furnishing the collateral or deposit.
(3) In case the person furnishing the collateral or deposit has a partial or limited title to or ownership of the property pledged as collateral or deposit, the person accepting such property as collateral or deposit shall also have title to that property to the same extent.

39. Creditors to have equal status :

(1) In case anyone has obtained credit from several creditors in one or several installments by pledging his/her property as collateral, and the property so pledged as collateral is not sufficient to repay the credit of all the creditors, all the creditors who have used the property as collateral shall be deemed to have equal status in
respect to outstanding credit and all of them may make a proportionate claim on the property, except when otherwise provided for in the contract.
(2) In case any property which has already been pledged as collateral under Sub-section (1) is again pledged as such with a provision to give priority to the second creditors in the future, the concerned contract shall be void. In case the (second) creditor has already realized his/her credit from the collateral before the contract becomes void even while knowing that there are other creditors in respect to the collateral, he/she shall refund the amount to the other creditors and realize his/her credit from the other assets of the person who has pledged the property as collateral.

Chapter- 7

Chapter- 7

Contract relating to Sale of Goods

4o. Contract relating to sale of goods :

(1) A contract relating to sale of goods shall be deemed to have been concluded . in case any seller agrees to hand over any goods to the buyer immediately or in the future by receiving a price. Explanation  For the purpose of this chapter, the term ‘goods’ means any type of movable or immovable property except current used currency, security, or actionable claim .
(2) A contract relating to sale of goods may be conditional or unconditional.
(3) A contract may be concluded with a provision to sell goods owned or possessed by the seller or those to be produced or acquired by him/her in the future.

41. Contract relating to sale of goods to be void : In case a contract has been concluded to sell specific goods, and in case the goods have suffered any loss or damage at the time of or before concluding the contract and the seller had no knowledge thereon at the time of concluding the contract, the contract shall be void.
Explanation For the purpose of this Section, ‘Specific goods’ means the specific goods mentioned at the time of concluding the contract.

42. Determination of price of goods :

(1) Except when otherwise provided for in the contract, the price of goods shall be determined on the basis of the terms and conditions of the contract or according to the procedure agreed upon in the contract or in the process of transaction between the parties.
(2) In case the price of goods has been determined according to their weight and measurement, the price of goods shall be fixed on the basis of the net weight and measurement, except when otherwise provided for in the contract.
(3) In case the price of goods can not be determined under Sub- section (1) or (2), the buyer shall pay to the seller a reasonable price taking into account the concerned circumstances.

43. Price of goods to be paid : Except when otherwise provided for in the contract, the price of goods must be fully paid as follows in the following circumstances:
(a) A buyer shall pay to the seller the price of goods bought by him/her at the time of buying them.
(b) The price of goods shall be paid in cash.
(c) The contract shall be deemed to have been concluded with a provision to pay the price and. hand over the goods simultaneously. Explanation For the purpose of this Section, the term ‘cash’ includes cheques, traveler’s cheques, promissory notes, bills of exchange, letter of credit, bank draft, credit card and telegraphic transfers payable through bank.

44. Particulars of goods :

(1) In case the name, brand, trademark or specification of goods to be sold are mentioned in the contract, the contract shall be deemed to have been concluded to sell goods of the same name, brand, trade mark or specification.
(2) In case the name, brand, trademark or specification and sample goods to be sold have been mentioned, the bulk of those goods shall correspond not only to the sample but also to their name, brand, trademark or specification as mentioned in the contract.

45. Title to be deemed to the goods to be sold :

(1)Except when otherwise provided for in the contract, the seller shall be deemed to have or going to have title to the goods agreed to sell in the future. Goods agreed to sell in the future shall be considered to be or going to be free from anybody’s seizure, control or procession .
(2) Except when otherwise provided for in the contract, the seller shall be deemed to have the right to sell the goods sold or to be sold by him/her.

46. Goods to be deemed to be of merchantable quality :

(1) Except when otherwise provided for in the contract, goods sold or to be sold shall be deemed to be of merchantable quality.
(2) In case specific goods sold or to be sold for any specific purpose are suitable for that purpose, they shall be considered to be of merchantable quality. Provided that in case any defect in the goods has been mentioned in the contract itself, or in case the buyer had become aware of any defect before signing the contract or while inspecting the goods, those goods shall not be deemed to be of merchantable quality.
(3) In case the quality of specific goods has been mentioned in  contract, those goods shall be deemed to be of the same quality. In case the quality of the goods is not mentioned in the contract, their quality shall be as of the current standard.
(4) Except when otherwise provided for in the contract, the seller shall not be deemed to have given a warranty to the effect that the goods sold or to be sold are of a specific quality.

47. Sale through samples:

(1) In case provisions have been made in a contract to sell goods after inspecting their samples directly or otherwise, it shall be deemed to have been signed to sell goods after inspecting their samples.
(2) In case a contract has been signed to sell goods after inspecting their sample, it shall be deemed to include the following conditions, except when otherwise provided for in the contract:
(a) The bulk of the goods shall correspond to the samples in quality.
(b) The buyer shall have, a reasonable opportunity to compare the quality of the bulk of the goods with the sample.
(c) The goods sold or to be sold shall be free from any defect, and that their merchantable quality shall be apparent while inspecting them at the time of comparing them with the sample.

48. Provisions concerning transfer of ownership of goods :

(1)In case a contract has been signed to sell specific or particular goods, their delivery shall be made as provided for in the contract, if any, and if not, according to
the conditions of the contract, the conduct of the parties, and the intention of the parties expressed through the concerned circumstances.
(2) Except when otherwise provided for in the contract, in case a contract has been signed in such a situation that specific goods can be delivered immediately, the parties shall be deemed to have the intention of delivering them after concluding the contract or paying their price.
(3) In case a contract has been signed in such a situation that specific goods can be delivered immediately, and in case the buyer has to weigh, measure and examine them or execute any function to determine their price, such goods shall not be delivered until such functions are executed and information thereof is supplied to the seller within a reasonable period.
(4) Except when otherwise provided for in the contract, a contract shall be deemed to have been made with a provisions to deliver the goods at the very place where they have been sold or are to be sold.
(5) Except when otherwise provided for in the contract, the title or ownership of the buyer shall be deemed to have been established on the goods from the very moment when they are delivered to him/her.

49. Risk to be borne :

(1) Except when otherwise provided for in the contract, the seller him/herself shall bear the risk of any loss or damage to the concerned goods until they are delivered to the buyer.
(2) In case there has been a delay in the delivery of goods due to any reason concerning the buyer or the seller, the party responsible for such delay shall bear the risk of loss or damage under Sub-section (1).
(3) In case the seller has agreed to deliver goods from the place of purchase to the place specified by the buyer, the seller him/herself shall bear the risk of any loss or damage to goods, except when otherwise provided for in the contract.

50. Buyer’s right to inspect goods : In case sold goods are delivered to the buyer; the buyer shall have a reasonable opportunity to examine and ascertain whether or not they, conform to the contract and he/she shall not be deemed to have accepted the goods until this is done.

51. Goods to be deemed delivered: The buyer shall be deemed to have received the goods in any of the following’ circumstances:
(a) In case the buyer or his/her representative receives the goods;
(b) In case a receipt or letter acknowledging the delivery of the goods is issued;
(c) In case the buyer inspects the goods and ascertains that they conform to the contract under Section 50, and accordingly keeps them in his/her stock;
(d) In case the goods reach the buyer and are retained by him/her, even if he does not send information about his/her refusal to accept them within a reasonable time limit,
(e) In case he/she does anything to prove his/her ownership of such goods.

52. Time-limit for delivering goods :

(1) In case the contract provides that gods to be delivered at any specified time or within any specified period, the seller must deliver the same to buyer at that very time or within that very period.
(2) Notwithstanding anything contained in Sub-section (1), in case the buyer accepts goods delivered by the seller before the time or period prescribed in the contract, or after the time of period prescribed in the contract, the seller shall be deemed to have delivered the goods.

53. Documents relating to sold goods to be handed over: Except when otherwise provided for in the contract, the ownership of goods shall not be deemed to have been transformed after sale until basic documents connected with their ownership or required for their use are handed over.

54. In the event of delivery of goods in a quality different from the
contracted quality:

(1) In case the seller delivers goods to the buyer in a quantity less than the quantity mentioned in the contract, the buyer may refuse to accept them. Provided that, in case the buyer accepts goods even in the quantity, he/she shall be required to pay the price of the quantity at the rate mentioned in the contract.
(2) In case the seller delivers goods to the buyer in a quantity higher than the quantity mentioned in the contract, the buyer might accept them only in the quantity mentioned in the contract, and reject the rest or the entire quantity. Provided that, in case the buyer accepts the entire quantity of goods so delivered, he/she shall be required to pay for them at the contract rate.
(3) In case the seller delivers to the buyer, he has contracted to sell mixed with goods of a description not included in the contract, the buyer may accept the goods mentioned in the contract and reject the rest, or reject the entire lot.
(4) Except when otherwise provided for in the contract, the buyer shall not be bound to accept delivery of goods in installments.
(5) Excepts when otherwise provided for in the contract, in case the buyer refuses to accept goods brought by the seller for delivery, the buyer shall not be bound to return them to the seller. Provided that the buyer shall inform the seller through the quickest possible means about his/her refusal along with the reasons thereof.

55. Special provisions concerning compensation : Notwithstanding anything contained elsewhere in this Act, action in respect to compensation for contract under this chapter shall be taken as follows:
(1) In case a buyer does not accept or refuses to accept or refuses to pay the price of goods after once signing a contract relating to sale of goods, the seller may, subject to the contract, claim compensation from the buyer in consideration of the buyer’s failure to accept or refusal to accept the goods.
(2) While determining compensation under Clause (a), in case goods not accepted or rejected by the buyer are available in the market, compensation shall be determined on the basis of the difference between the price of goods mentioned in the contract and the market or current price.
(3) In case the seller does not deliver or refuses to deliver goods according to the contract after signing a contract relating to sale of goods, the buyer may claim compensation from the seller in consideration of his/her failure to deliver the goods. While determining Compensation under Clause (c), in case the goods which the seller has refused or failed to deliver to the buyer are available in the market, compensation shall be determined on the basis of difference between the price of the goods mentioned in the contract and the market or current price

Chapter- 8

Chapter- 8

Contracts Relating to Agency

56. Contracts relating to Agency : Any person may appoint any other person as his/her agent to do anything on his/her behalf, except something connected with his/her personal skills or to conduct business as his/her agent of may transaction with a third person on his behalf or to represent himself to such person, or to establish any kind of legal relation with the person appointing an agent and a third person, and in case an agent is so appointed, a contract relating to agency shall be deemed to have been concluded.

57. Recognition of transaction made or carried out by an agent:

(1) The liability resulting from the contract concluded through an agent appointed under Section 57 or from the action taken or work performed by the agent, shall be recognized as resulting from a contract signed or work performed by the principal person, and implemented accordingly. Provided that, the principal person shall not be responsible for any action taken by the agent beyond his/her authority.
(2) Notwithstanding anything contained in Sub-section (2), among the actions taken beyond the authority, in case some of them are within his/her authority and some beyond it, and in case the action taken from within his authority can be separated principal person shall be responsible for actions taken to the extent of his/her authority.
(3) Any information supplied to the agent in the course of transactions with the principal person through his/her agent shall be deemed to have been supplied to the principal person.

58. Power to appoint Sub-agents :

(1) In case it is necessary to appoint, a sub-agent according to the nature of any trade, business or transaction, or in case a sub-agent can be appointed according to provision contained or practice followed in the contract relating to agency, the agent may, except when otherwise provided for in the contract, appoint a sub-agent with the consent of the principal person. Provided that, an agent who has been appointed on the condition that he/she will personally represent or personally execute any work may be able to appoint a sub-agent.
(2) In case a sub-agent is appointed under Sub-section (1), the principal person shall be informed accordingly, and a sub-agent so appointed in that manner shall have right and duty equal to that of the agent appointed by the principal person.
(3) In case any agent appoints a sub-agent without the consent of the principal person, the latter shall not be responsible for any action taken or work performed by the sub-agent. A sub-agent so appointed shall be personally responsible.

59. Matters to be complied with by agent:

(1) Except when otherwise provided for in the contract, an agent shall comply with the following matters:
(a) Work subject to the conditions of the contract relating to agency and the directives issued by the principal person.
(b) In case no condition has been mentioned in the contract or the principal person has issued no directive, the agent shall work as entrusted to him/her in the manner in which it has to be performed according to the nature of the trade and business and the laws and practices of the place of transaction, with bona fide motive, full dedication and necessary skills and efficiency. Provided that in case the principal person has a knowledge in advance that the agent has a knowledge in advance that the agent has no skill or capability in respect to any subject, the agent shall not be responsible for any loss or damage resulting from such lack of skill or capability.
(c) An agent who has been removed from his/her position shall not do anything on the same subject, as before, in the capacity of an agent.
(d) The agent shall supply or show details of account and record relating to the agency business when deanded by the principal person.
(e) In case any obstruction, obstacle or difficulty arises in the course of performing work relating to agency, the agent shall notify the principal person as soon as possible and obtain necessary directives, and the principal person shall him/herself be responsible for any action taken according to the directives so issue.
(2) In case the principal person suffers any loss or damage because of the failure of the agent to fulfill his/her duties under Clause (a), (b) and (c), agent shall personally bear loss or damage so incurred.

60. Agent to be responsible:

(1) Except when otherwise provided for in the contract, the agent shall be personally responsible for transactions made by him/her on behalf of the principal person in the following circumstances:
(a) In case he/she concludes a contract with a third party in relation to any transaction with provision for personal responsibility.
(b) In case any work has been done for or on behalf of an unidentified principal person, in case the principal person is not identified;
(c) In case the principal person can not be sued for any reason;
(d) In case the contract has been signed in his/her own name;
(e) In case anything has been done in contravention of the contract relating to the appointment of agent or beyond his/her authority;
(f) In case any fraud or cheating has been committed in the course of the transaction
(g) In case the agent has to bear personal liability according to the nature of the trade;
(h) In case the interest of the agent is also involved in the transaction.
(2) Except when otherwise provided for in the contract concluded between the agent and a third person, only the fact that the gent is personally responsible under Sub-section (1) shall not be deemed to have prejudices the right of the third person to make any claim against the principal person and legal action may be initiated against the principal person as well for arrears due from the agent.
(3) For the purpose of initiating legal action against the principal person under Sub-section (2), the time limit shall be deemed to have begun from the date of the last payment made by the agent.

61. Termination of agency :

(1) Except when otherwise provided for in the contract, the agency shall be deemed to have epso facto terminated in the following circumstances;
(a) In case the agent voluntarily decides not to continue it;
(b) In case the principal person conceals the authority granted or contract signed with the agent or gives a notice to the agent regarding the impossibility of complying with the contract;
(c) In case the agent has been appointed for any specific work that works is completed;
(d) In case the agent has been appointed for a specific period, after the expiry of that period;
(e) In case the principal person or the agent loses his/her senses;
(f) In case the principal person is declared bankrupt;
(g) In case the subject regarding, which the agent has been appointed no longer exists;
(h) In case an agent is appointed by a company or an agent of a company, if the company is liquidated.
(2) All or any of the power granted by the principal person to the agent may be cancelled at any time before the agent exercises them. Provided that, in case the agent has already exercised some of such powers, the work performed regarding to those powers shall not be deemed to have been cancelled.
(3) Notwithstanding anything contained elsewhere in this Section, in case the agent has a share in the property connected with the main subject of the agency, the agent may not be dismissed, in such a manner as to have a negative impact on such share.

62. Prohibition to remove an agent :

(1) Except when otherwise provided for the contract, in case an agent has been appointed for any specific period or work, the principal person shall not remove him/her before that period or before the completion of that work without appropriate and sufficient reasons.
(2) An agent who has been appointed without prescribing any specific period or work can not be removed without a prior notice mentioning appropriate reasons;
(3) In case the principal person removes any agent in a manner opposed to Sub-sections (1) or (2), the principal person shall pay a reasonable compensation to the agent.

63. Agent prohibited from giving up agency :

(1) Except when otherwise provided for in the contract, the agent who has been appointed for a specific period or work shall not stop working as an agent before the expiry of the specific period or completion of the specified work without appropriate and sufficient reasons.
(2) An agent who has been appointed without specifying the period or work under Sub-section (1) shall not give up that work without informing the principal person in advance along with the reasons for doing so.
(3) In case any agent stops working in that capacity contrary to Sub-section (1) or (2), the principal person may claim a reasonable compensation.

64. Sub-agent also to leave if agent leaves: In case an agent no longer remains in that capacity under this act, the sub-agent appointed by him/her shall also be deemed to have automatically left

Chapter- 9

Chapter- 9

Contracts Relating to Transportation of Goods

65. Contracts relating to Transportation :

(1) A contract relating to transportation shall be deemed to have been concluded if it provides for the transportation of goods from one place to another.
(2) Except when otherwise provided for in the contract, the receipt to be issued by the transporter to the owner of goods for their transportation at the time of handling them over for the purpose of transportation shall be recognized as proof of contract between them. Explanation: For the purpose of this Chapter, the term ‘transporter’ means a person operating a transport service other than air or marine transport, or a person operating a business of such operation, and the term also includes a person operating the transport business through animal or any other means. Provided that, in case any person employed by the owner of goods on wage basis or his/her agent or a person working under him/her transports goods, he/she shall not be recognized as a transporter for the purpose of this chapter.

66. Transporter’s obligations :

(1) It shall be the obligation of the transporter to transport and condition goods received from their owners for transportation at the prescribed place and in their proper condition.
(2) In case goods received from the owner for transportation are lost, destroyed, broken, harmed or damaged, or in case they do not reach their destination in proper condition for any other reason, the transporter shall be held responsible.
(3) The transporter shall transport goods within the period mentioned in the contract, and within a reasonable period in case no period for transporting the same has been mentioned in the contract, and hand them over to their owner or his/her agent or a person designated by him/her.

67. First transporter to be held responsible in case goods are transported through several means of transport: In case it becomes necessary to transport goods through more than one transporter or though more than one means of transport, the transporter to whom the owner of goods has handed them over shall be held personally responsible for the purpose of this chapter, except when otherwise provided for in the contract.

68. Liability of transporter to be limited :

(1) Except when the owner of goods or his/her agent has clearly declared at the time of concluding the contract that the goods to be transported are worth more than Ten Thousand Rupees or except when otherwise provided for in the contract, the amount of compensation to be paid by a transporter for any loss or damage to goods transported by him/her shall not exceed Ten Thousand Rupees.
(2) Notwithstanding anything contained in Sub-section (1), the transporter shall not be held liable for any loss or damage to gold, sliver, diamond jewels or goods made thereof, precious stone, negotiable instruments, securities, documents registered by offices, certificates issued by educational and other institutes, coins, bank notes, postal stamps, fish, meat, fresh fruits and vegetables, insecticide, inflammable materials, petroleum products, precious art pieces, idols, curio goods or fragile goods, wildlife and pets, handicrafts, arms and ammunition, explosives, radio, television, computer and similar other goods and their spare parts, machinery and goods specified in prevailing law as those which have to be declared by the owner before their transportation, except when the owner or his agent has clearly declared them at the time of signing the contract or at the time of handing them over to signing the contract or at the time of handing them over to the transportation for the transporter.
(3) For the purpose of bearing the risk involved in the transportation of goods mentioned in Sub-section (2), the transporter might have them insured against the risk through their owner or his/her agent or by him/herself by collecting a separate fee for the purpose, or take other necessary arrangement to avoid the risk.

69. Transporters to be responsible : A transporter shall pay a reasonable compensation to the concerned owner for any loss or damage in the process of transportation of goods declared at the time of signing the contract of handling them over to the transporter for transportation under this Chapter, or for goods which need not be declared, as provided for in the contract, if any, and, if not, reimbursement of the transported goods with the agreement of their owner, or in case no such agreement is reached or can be reached, according to the current price of the goods, and if the current price can not be determined, according to a reasonable price, subject to Chapter 12.

70. Transporter’s liability to be ended: Except when otherwise provided for in the contract, the liability of a transporter shall be deemed to have ended in any of the following circumstances:
(a) In case the transporter or his agent transports the goods and hands them over to the owner or his/her agent, or a person designated by him;
(b) In case the goods handed over to the transporter are received back by the owner or his/her agent.
(c) In case the transporter or his agent returns the goods to the owner or his/her agents citing the reason why the goods can not be transported within the prescribed period in the circumstances mentioned in Clause (b) of Sub-section (2) of Section 79.

Chapter- 10

Chapter- 10

Time, Procedure and Place for Performing Contracts

71. Times and Procedure of performing contract :

(1) In case the time and procedure of performing the contract has been mentioned in the contract, it shall be performed within the specified time and according to the specified procedure.
(2) In case no time or procedure of performing the work mentioned in the contract has been specified, whereas, in case the work can be performed only at any specific time or according to any specific procedure, the contract shall be deemed to have been concluded so as to perform the work at that time and according to that procedure.
(3) Except in the circumstances mentioned in Sub-section (2), in case the time and procedure of performing the contract has not been mentioned in the contract, the contract shall be performed within a reasonable time by adapting a reasonable procedure.

72. Place for performing contract:

(1) In case any specific place has been specified in the contract for performing the work, the work shall be performed at the same place.
(2) In case any party has to hand over or deliver goods to the other party under the contract, and the place where those goods are to be handed over or delivered has not been specified in the contract, the contract shall be deemed to have been concluded with a provision to and over or deliver the goods at the place where those goods are stored.
(3) In case the specific place where the work mentioned in the contract has to be performed, has not been specified in the contract, and where as that work can be performed only in a specific place, or in case the work needs to be performed in any specific place due to the general practice and custom or the nature of the work, the contract shall be deemed to have been concluded with a provision to perform at work at place.
(4) In circumstances other than those mentioned in Sub-sections (2) and (3), in case the place for performing the work prescribed in the contract is not mentioned in the contract, the party performing the work according to the contract shall inform the other party to specify a reasonable place for performing the work, and the other party shall specify a reasonable place to perform the work.

73. Circumstances in which contracts need not be performed: Work under a contract need not be performed in any of the following circumstances:
(a) In case one party to the contract absolves the other party from fulfilling the obligations according to the contract;
(b) In case a voidable contract is made void by the party concerned;
(c) In case one can not execute the contract due to its violation by the other party;
(c) In case it becomes unnecessary to perform the work mentioned in the contract under any provision of this Act;
(d) In case it becomes unnecessary to comply with the contract under Section 79

Chapter- 11

Chapter- 11

Execution of Contract and Obligation Arising out of the Contract

74. Obligation under contract to be fulfilled : Each party to a contract shall fulfill his/her obligation under the contract.

75. Reciprocal compliance with contract :

(1) In case a contract has been concluded with a provision requiring both parties to simultaneously fulfill their respective obligations, and in case one party fundamentally shows a conduct or intention of not fulfilling his/her obligation the other party shall not be required to fulfill his/her promise.
(2) In case the order of priority relating to fulfillment of any promise has been specified in the contract itself, it shall be fulfilled accordingly, and in case no such order of priority has been specified, the party who is required to do so first according to the nature of the contract shall fulfill it.
(3) In case one promise can not be fulfilled without fulfilling another promise under any contract containing reciprocal promises, the party, which can not execute the contract because of the failure of the other party to fulfill its promise, may recover the loss or damage caused by the failure of the other party to execute the contract.
(4) In case a contract of the type mentioned in Sub-section (1) has been concluded, and any party obstructs the other party from executing the contract, the party which becomes unable to execute the contract may the contract cancel and also recover any loss or damage suffered by him/her from the cancellation of the contract in that manner.

76. Devolution of rights and liabilities of contract : In case party to a contract dies or loses his/her senses, the rights accruing from the contract shall devolve on the heir to his/her property, and the heir shall also bear liability to the extent covered by the property received by him/her. Provided that, the rights and liabilities accruing on the basis of personal skills and qualification shall not devolve on such heir.

77. Person to execute contract:

(1) Except when the person concluding contract is under the obligation to execute the contract, he/she may have it executed by his agent or a person appointed by him/her or any other person on his/her behalf. Provided that, no party to a contract may transfer the obligations under the contract to any other person without the consent of the other party.
(2) Except when otherwise provided for in the contract, once a party accepts a work done by a third person, he/her may not later claim that the work has to be done by the party signing the contract.
(3) In case two or more person have jointly signed a contract with any other party, any of the persons jointly signing the contract shall fulfill or cause to do so for the fulfillment of the obligation under the contract, except when otherwise provided for in the contract.
(4) In case any person has fulfilled his/her obligation under Sub- section (3), the person so fulfilling the obligations may recover compensation or loss on a proportionate basis from the other persons jointly signing the contract.
(5) In a contract signed in the manner mentioned in Sub-section (3), in case any party gives concession to any person belonging to the other party from the obligations of his/her share, the other person shall not be free from the remaining obligation of the contract.

78. Only the party shall have right to execute the contract :

(1) Only a person who is a party to a contract may demand the execution of that contract from other party. Provided that, in case the contract has been signed for the benefit of any person, such person may demand the execution of that contract even if he/she is not a party to that contract.
(2) In case two or more than two persons jointly agree upon to perform or not to perform any work, except when otherwise provided for in the contract, all persons so concluding- the contract may demand the execution of that contract.

79. Contracts need not executed in the event of fundamental changes in the situation:

(1) In case it becomes impossible to execute a contract as a result of fundamental change in the situation prevailing at the time of signing of the contract, the work under the contract need not be performed.
(2) Without prejudice to the generality of Sub-section (1), fundamental change shall be deemed to have come in the situation prevailing at the time of signing of the contract in any of the following circumstances:
(a) In case the contract becomes illegal and it can not be executed;
(b) In case it becomes impossible to execute the contract due to emergence of such situations as war, floods landslides, fire, earthquakes, and volcanic eruptions, which are beyond the control of human beings;
(c) In case anything essential for executing the contract is destroyed or damaged, or no longer exists, or can not be obtained;
(d) In case the contract has been signed with a provision to provide services on the basis of efficiency, skill or talent, and the person providing such service dies or loses his/her sense or becomes incapable of performing the contract because of physical or mental disability.
(3) Notwithstanding anything contained in Sub-section (2), fundamental changes shall not be deemed to have come in the situation prevailing at the time of signing the contract in any of the following circumstances:
(a) In case it becomes difficult to perform the contract;
(b) In case profit margin is low or loss is expected;
(c) In case any party to a contract is dependent upon any third party who is not a party to the contract for performing the contract, if the third party commits a mistake or becomes unfit;
(d) In the event of strikes and lockouts;
(e) In case it becomes necessary to pay additional tax, fee or other revenue;
(f) In case the contract has been signed with several objectives and only some of them can not be fulfilled.
(4) In case it becomes impossible to execute a contract because of fundamental changes in the situation as mentioned in Sub-section (2), action in the following matters shall be taken as follows;
(a) The amount paid by one party to the other in consideration of the contract before such a change in the situation occurs shall be refunded to the other party.
(b) Payment to be made or due from one party to the other in consideration of the contract shall not be made after such a change in the situation.
(c) In case any party has performed any work or paid any amount before such a change in the situation, such work or amount shall be calculated and the amount to be paid to each other should be determined, and reasonable expenses incurred by one party in consideration of the contract may be recovered from the other party.
(5) Notwithstanding anything contained in this Section, after the end of the situation mentioned in Clause (b) of Sub-section (3), the parties to a contract may agree to fulfill their respective obligations by executing the contract.

80. Facilities to be provided: The parties to a contract shall provide facilities needed for executing the contract from their respective sides. In case the contract can not be executed due to failure of providing such facilities, the party failing to execute the contract in that manner shall not be held responsible.

81. Contract may be suspended or altered:

(1) In case the parties to a contract agree, all or any of the portions of the work to be performed under the contract may be changed or amended, the time-limit for performing any work under the contract extended, the contract suspended by not making it obligatory to perform any work to be performed under the contract for
some time, the work mentioned in the contract may be replaced by another work, or a new contract may be signed as a replacement of the original contract.
(2) In case any change or amendment is made in the contract under Sub section (1), a new contract shall be deemed to have been signed, and the contract shall become effective accordingly. In case a new contract is signed in this manner, liability under the initial contract need not be borne except when otherwise provided for in the contract.

Chapter- 12

Chapter- 12:

Breach of Contract and Remedies

82 . Breach of contract :

(1) In case any party to a contract does not meet liability under the contract, or gives a notice to the other party that he/she will not perform the work to be performed under the contract, or in case his/her action or conduct shows that he/she is incapable of performing the work under the contract, he shall be deemed to have breached the contract.
(2) In case a party has broken the contract under Sub-section (1), or in case his/her action or conduct shows that he/she has not basically compiled with the contract, the other party shall not be compelled to perform the contract, and may cancel the contract by furnishing a notice thereof to the other party.

83. Compensation on breach of contract:

(1) In case a contract has been breached under Section 82, the aggrieved party may realize from the party who has broken the contract, the actual loss or damage suffered by him/her a result of such breach of contract of the loss or damage, which the contracting parties had anticipated at the time of signing the contract.
(2) In case the contract provides that any specific amount or compensation shall be paid in the event of breach of contract, the aggrieved party may recover from the other party a reasonable amount not exceeding that amount.(3) In case the amount of compensation under Sub-section (2) is not mentioned, the party making a claim for such compensation may realize a reasonable amount in consideration of the direct and actual looser damage that has resulted form the breach of contract, or in consideration of the breach of contract, or in consideration of the breach of contract, or in consideration of compensation. No compensation may be recovered for any indirect or imaginary loss or damage.
(4) In case a contract has been signed for completing any work within a specific period, and in case provision has been made for payment of compensation under Sub-section (1) for failure to complete that work within the specific period, the party paying compensation may request for extension of the period for completing the contract in proportion to the amount paid by him/her as compensation.

84. Compensation in the event of cancellation or termination of contract:

(1) In case a contract is terminated with the mutual consent of both parties or it is no longer necessary to perform the contract under this Act or other prevailing laws, or in case the contract is made void under the law or becomes void or cancelled under this Act, after one party has already received some amount in cash or in kind or any other benefit from the. other party as per the contract, the cash or goods which have to be refunded after adjusting the accounts until the term of the contract expires from the amount paid in cash or in kind shall be refunded. In case any service or benefit other than cash or goods has been provided, the beneficiary must pay a reasonable amount to the other party in consideration thereof.
(2) In case it becomes necessary to initiate legal action owing to the non-refundment of the amount paid in cash or kind or the non-payment of amount under Sub-section (1), the concerned party may also realize reasonable expenses incurred for the purpose.

85. Right to recover a reasonable amount: The aggrieved party may claim payment in proportion to the work performed or the amount paid by him/her in cash or in kind in any of the following circumstances;
(a) In case the contract is terminated due to the mistake of the other party at a time when he/she has already completed the work to be performed under the contract or was performing it;
(b) In case the other party utilizes any service or commodity that has been given to him/her without the clear intention of giving it free of cost.

86. Execution of contract as stipulated (Specific performance ):

(1) In case the cash compensation paid in consideration of the actual loss or damage suffered by the aggrieved party as a result of breach of contract is not reasonable or adequate, the aggrieved party may demand the execution of the contract as stipulated specific performance instead of making a claim for compensation.
(2) Notwithstanding anything contained in Sub-section (1), no claims for execution of the contract as stipulated specific performance shall be heard in any of the following circumstances;
(a) In case the amount paid in cash as compensation for breach of contract is adequate;
(b) In case the court can not supervise whether or not the work to be performed under the contract has been actually performed;
(c) In case the contract has been signed for providing services relating to personal expertise, skill or knowledge;
(d) In case the situation is – such that the contract can not be executed as stipulated;
(e) In case the party violating the contract him/herself demands that the contract be executed as stipulated.

87. Power of the judiciary to issue orders :

(1) In case it becomes impossible to execute the contract because any party about to take any action or behave in a manner contrary to the nature of the contract, the party . aggrieved by such action or conduct may file a complaint with the Appellate Court to stay such action or conduct.
(2) In case a complaint is filled under Sub-section (1), the court may issue an appropriate order to any party to immediately stop his/her specific action or conduct with a provision to settle the dispute resulting from that contract according to the contract or prevailing law, notwithstanding, anything contained in prevailing law.
(3) In case such order is issued, the aggrieved party may also realize the additional loss or damage resulting from the failure of the other party to comply with the order issued under Sub-section (2).

Chapter- 13

Chapter- 13

Miscellaneous

88. Prevailing law to be obeyed: In case prevailing law prescribes that any specific procedure must be followed for executing any specific contract, or that any specific contract, must be registered at any government office, a contract signed without fulfilling such formalities shall not be valid.

89. Limitations:

(1) In case prevailing law prescribe any specific limitation in respect to any specific contract or any specific matter relating to contracts, such time limits shall be applicable.

(2) Complain in respect to the following contracts or matters other than those mentioned in Sub-section (1) shall not be heard unless these are filed within the limitation as mentioned hereunder;
(a) In the case of void a contract, to have them declared void at any time;
(b) In the case of a voidable contract, within a year from the date when the party that can have the contract declared void learns about the reason for having the contract declared to be void;
(c) In the case of contracts mentioned in Chapter 7, within two years from the date of emergence of the reason for filing a lawsuit;
(d) In the case of any other claim under this Act, within two years from the date of emergence of the reason for filing a lawsuit for such a claim.

90. Repeal and saving: The Contract Act 2023 (1966), and the Chapter on Bailment and Deposits of the Muluki Ain (Legal Code) have been repealed

Civil Aviation Act, 2015 (1959)

Civil Aviation Act, 2015 (1959)
Date of Authentication                                                                                                                                                                  Publication Date on Nepal Gazette
2015.12.31                                                                                                                                                                                                   2016.1.10
Amendments
1. Some Nepal Laws (Amendment and Rearrangement) Act, 2020                                                                                               2020.11.16
2. Civil Aviation (First Amendment) Act, 2023                                                                                                                                2023.5.24
3. Civil Aviation (Second Amendment) Act, 2030                                                                                                                           2030.5.16
4. Civil Aviation (Third Amendment) Act, 2034                                                                                                                                 2034.6.6
5. Administration of Justice Act, 2048                                                                                                                                                     2048.2.16
6. Civil Aviation (Fourth Amendment) Act, 2053                                                                                                                                     2053.8.5
7. Some Nepal Laws Amendment Act, 2063                                                                                                                                      2063.6.28
8. Republic Strengthening and Some Nepal Laws Amendment Act, 2066                                                                                    2066.10.7
Act Number 22 of the Year 2015
An Act Made to Control and Regulate Civil Aviation
Preamble: Whereas, it is expedient to control and regulate civil aviation to create conditions favourable to promote the development of civil aviation so that the country could acquire maximum benefit from the air transportation, and to maintain peace, order and convenience of the people in general, Now, therefore, be it enacted and promulgated by His Majesty the King on the advice of the Council of Ministers

1. Short Title, Extent and Commencement

1. Short Title, Extent and Commencement:

(1) This Act may be called “The Civil Aviation Act, 2015 (1959)”.
(2) This Act shall extend all over the Nepal, and also apply to the following aircrafts and persons –
(a) Every citizen of Nepal wherever he/she may be, and
(b) Every aircraft registered in the Nepal, wherever it may be, and every person on board an aircraft.
(3) This Act shall come into force from such date as Government of Nepal, by a Notification published in the Nepal Gazette, may appoint