Sri Lanka Police have clarified the legal procedure governing the repossession of vehicles and other equipment supplied under finance leases, warning that leasing companies and their agents cannot simply use force when a customer resists repossession.
The clarification concerns agreements governed by the Finance Leasing Act No. 56 of 2000.
What can a leasing company do?
According to Police, a lessor or authorised representative seeking possession of leased property must follow the procedure set out in law.
The lessor should notify the Officer-in-Charge or Headquarters Inspector of the police station in the area where the property is located.
Police protection may then be requested for the purpose of maintaining public order and preventing a breach of the peace.
However, police officers do not physically repossess the vehicle or equipment on behalf of the leasing company.
What happens if the customer resists?
Where the person in possession offers no resistance, the lessor may take possession peacefully in accordance with the applicable law.
If the person resists repossession, the lessor must seek relief through the relevant District Court rather than forcibly taking the property.
Police said complaints may be made where repossession is allegedly carried out contrary to the law.
If an investigation establishes offences such as robbery, theft, criminal trespass or other criminal conduct, legal action may follow.
Hire-purchase agreements are different
Police also distinguished finance leases governed by the Finance Leasing Act from hire-purchase agreements under the Consumer Credit Act No. 29 of 1982.
The same police-intervention provisions should not automatically be assumed to apply to both types of agreement.
Repayment obligations remain
The clarification does not mean customers may ignore contractual repayment obligations.
It concerns the lawful method of repossession when possession is disputed, not whether valid debts or contractual obligations remain payable.