(1) Notwithstanding anything in the Andhra Pradesh (Andhra Area) Agriculturists Relief Act, 1938, the 1Telangana Money Lenders Act, 1349 F., the Andhra Pradesh (Andhra Area) Pawn-brokers Act, 1943, the 2Andhra Pradesh (Telangana Area) Agricultural Debtors' Relief Act, 1956, 3the Telangana (Scheduled Area) Money Lenders Regulation, 1960, the 3Telangana Indebted Agriculturists, Landless Labourers and Artisans (Temporary Relief) Act, 1976 or any law for the time being in force, or any contract or other instrument having the force of law with effect on and from the commencement of this Act, every debt borrowed or incurred during the period between the 29th December, 1976 and 4[the 31st May, 1989] including interest, if any, owing to any creditor by an agricultural labourer, a rural artisan or a small farmer shall be deemed to be wholly discharged.
(2) (a) No Civil Court shall entertain any suit or other proceeding against the debtor for the recovery of any amount of the debt, including interest, if any, which is deemed to be discharged under sub-section (1):
Provided that where any suit or other proceeding is instituted jointly against the debtor and any other person, nothing in this sub-section shall apply to the maintainability of such suit or proceeding in so far as it relates to such other person.
(b) All suits and other proceedings including appeals, revisions, attachments or execution proceeding pending 4[as on the 31st May, 1989,] against any debtor for the recovery of any such debt, including interest, if any, shall abate:
Provided that nothing in this clause shall apply to the sale, in respect of any such debt of
(i) any movable property held and concluded before commencement of this Act;
(ii) any immovable property, confirmed before such commencement.
(c) Every debtor undergoing detention in a civil prison in execution of any decree for money passed against him by a Civil Court in respect of any such debt, including interest if any, shall be released.
(3) (a) Every movable property pledged by a debtor whose debt is deemed to be discharged under sub-section (1), shall stand released, in favour of such debtor and the creditor shall be bound to deliver the same to the debtor forthwith.
(b) Every mortgage executed by such debtor in favour of the creditor shall stand redeemed and the mortgaged property shall be released in favour of such debtor.
Explanation: Nothing in this section shall be construed as entitling any debtor for refund of any part of any debt repaid or interest paid already by him or recovered from him before, such commencement.
(2) (a) No Civil Court shall entertain any suit or other proceeding against the debtor for the recovery of any amount of the debt, including interest, if any, which is deemed to be discharged under sub-section (1):
Provided that where any suit or other proceeding is instituted jointly against the debtor and any other person, nothing in this sub-section shall apply to the maintainability of such suit or proceeding in so far as it relates to such other person.
(b) All suits and other proceedings including appeals, revisions, attachments or execution proceeding pending 4[as on the 31st May, 1989,] against any debtor for the recovery of any such debt, including interest, if any, shall abate:
Provided that nothing in this clause shall apply to the sale, in respect of any such debt of
(i) any movable property held and concluded before commencement of this Act;
(ii) any immovable property, confirmed before such commencement.
(c) Every debtor undergoing detention in a civil prison in execution of any decree for money passed against him by a Civil Court in respect of any such debt, including interest if any, shall be released.
(3) (a) Every movable property pledged by a debtor whose debt is deemed to be discharged under sub-section (1), shall stand released, in favour of such debtor and the creditor shall be bound to deliver the same to the debtor forthwith.
(b) Every mortgage executed by such debtor in favour of the creditor shall stand redeemed and the mortgaged property shall be released in favour of such debtor.
Explanation: Nothing in this section shall be construed as entitling any debtor for refund of any part of any debt repaid or interest paid already by him or recovered from him before, such commencement.
Source footnotes
1. Substituted by the Telangana Adaptation of Laws (No.2) Order, 2016, issued in G.O.Ms.No.46, Law (F) Department, dated 01.06.2016.2. Repealed by G.O.Ms.No.46, Law (F) Department, dated 01.06.2016.
3. Substituted by G.O.Ms.No.45, Law (F) Department, dated 01.06.2016.
4. Substituted by Act No.2 of 1990.
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India Code, Government of India. Text fetched 12 Oct 2026. Check the linked official text and subsequent notifications when applying a provision.