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The following are the points of distinction between hire purchase and installment system:
(1) The parties to the contract are called hire-purchase and hire-vendor.
(2) The property in the goods passes from hire-vendor to hire-purchaser only after the hire- purchaser has paid all of the stipulated number of instalments.
(3) The relation between hire-purchase and hire-vendor is that of a bailee and a bailor. As a result, the hire-purchaser has no right of disposal of goods till he becomes the owner.
(4) If the hire-purchaser has taken as much care of the goods as is required to be taken by a bailee, he is not responsible for the loss of the goods.
(5) If the hire-purchaser makes a default in payment of an instalment, the hire-vendor gets the right to repossess the goods.
(6) The hire purchaser can terminate the contract. He will return the goods but will not be required to pay the remaining instalments. However in cases, he may be required to pay a sum not exceeding the termination charges mentioned in the contract.
(1) The parties to the contract are called buyer and seller.
(2) The property in the goods passes from seller to buyer as soon as the contract is signed. In other words, the buyer becomes the owner of the goods immediately on the signing of the contract.
(3) It is a contract of sale. No bailment is involved. As a result, the buyer can dispose of the goods as he likes.
(4) As risk lies with ownership and the buyer becomes owner of the goods on signing of the contract, any loss of goods will have to be borne by the buyer.
(5) If the buyer makes a default in payment of an instalment, the seller can only sue for the balance of the amount unpaid together with interest; he cannot repossess the goods.
(6) The buyer cannot terminate the contract and escape the liability of the payment of the remaining instalments.
Possession and ownership is the difference
i guess to hire is away for immediate need but the installment is away of possession but after a period .
