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mjreddy   26 August 2017

House sold to return lending money - cheque bounce case

Sir,

    My brother-in-law has taken money from his friends and relatives for earning income from lending at 4% rate of interest. He has taken 1% & has given 3% to the lenders. Finally 1 day all of the people to whom he had given the money are no longer paying him any interest, but he did not want to give this impression to his friends hence continued paying them the interests from his own salary. However that could not sustain for long, so finally he concluded the situation to them and mentioend the situation, but none were ready to agree. Due to their threatens and demands he sold off his house and payed few of the lenders back their money, however there are more people who could not be paid because they are asking for interest + principal, but he is ready to pay them the "principal" amount only. 

    Now they have gone to Legal and sent Court Notice and have filed cases against him because they had Cheques for security. Now what options does he have because none of them are agreeing to the settlement for principal only.

1) In truth he has paid all the lenders lot more money as interest than the principal amount also, however lot of this is in the form of cash.

2) He has few cheques from the people to whom he has lent money and he also has put case against them, but they are all missing.

 

So what options does he have, given he has already sold his house.

 

> Can he go to the court and proceed legally, will there be any benefit for him given that he has paid interest amount more than the principal.

> Also the lenders to whom he has given money have cheated him. Will there be any benefit for him if this case is presented in the court ?

> Can he apply for insolvency, though he has job 

> Can he agree the repay the amount to the lenders in monthly installments after deducting the livelihood expenses ?

 

Would be great if a good lawyer can provide their contact, so that this can be fought in the court of law in bangalore.

Thanks for your help.



Learning

 7 Replies

Siddharth Srivastava (Advocate)     26 August 2017

Do not get dishearted. Are there agreements between your brother in law and the persons from whom he had taken money or had lend money? There are remedies for which details and documents are required to be examined. Cheques given as security does not attract prosecution u/s.138 NI Act. You require detaied advise. Sidharth 9811776422

Rama chary Rachakonda (Secunderabad/Telangana state Highcourt practice watsapp no.9989324294 )     27 August 2017

the exchange of money is usually based on mutual trust. The heirs of the deceased only have a moral obligation to repay the loan. However, if any such loan is accompanied by a legal document, then the repayment liability will depend on the required clause mentioned in the document. Keep up promise is more important than money.

 

Sudhir Kumar, Advocate (Advocate)     31 August 2017

घर में नहीं दाने पर बाबा चले भुनाने Basically his over smartness betrayed. He wanted to earn by lending other's money (apparently on large scale) assuming all others to be fools. When he had no capacity to recover he thought borrowers to be fools who will refund having no motivation to pay. Such loans are either taken for illegal purpose or by persons unsound enough to take bank loan When his creditors had capacity to recover he assumed them to be fools to let him go while they were wise enough not to lend directly @ 4 percent.

Sudhir Kumar, Advocate (Advocate)     31 August 2017

घर में नहीं दाने पर बाबा चले भुनाने Basically his over smartness betrayed. He wanted to earn by lending other's money (apparently on large scale) assuming all others to be fools. When he had no capacity to recover he thought borrowers to be fools who will refund having no motivation to pay. Such loans are either taken for illegal purpose or by persons unsound enough to take bank loan When his creditors had capacity to recover he assumed them to be fools to let him go while they were wise enough not to lend directly @ 4 percent.

Sudhir Kumar, Advocate (Advocate)     31 August 2017

You said he is getting salary Is he government employee

Sudhir Kumar, Advocate (Advocate)     31 August 2017

You said he is getting salary Is he government employee

Sudhir Kumar, Advocate (Advocate)     03 September 2017

Money given to friends and relatives is always a charity in the garb of loan which is given in expectation of refund but always taken with intention of non-refund.

 

Such loan is taken by a person:-

 

  1. Who lacks business sense and cannot raise funds out of his own business and suddenly wants to be rich.

 

  1. who cannot raise bank loan because :-

 

Either

he himself is not creditworthy

 

Or

 the purpose for which he seeks loan is illegal

 

or

the purpose for which he seeks loan is not at all commercially viable.

 

  1.  Who knows he can afford not to refund.
  2. Who trusts his thick skin
  3. Who intends not to refund
  4. Who has made fortification against action of refund.

 

So he has to find someone who can part with his money. SO he finds a lender near him (friend or relative)

 

Such loans are given by the persons :-

 

  1. Who has surplus money.
  2. Who displays and boasts of such surplus money.
  3. Who stupidly believe that there will be a refund.
  4. Fails to realise as to why he alone (not bank) is being contacted for loan.
  5. Who has extreme trust on the debtor
  6. who are either stupid or extremely greedy of the unusual (or illegal) rate of interest.

 

Such loans are always given

 

  1. Without documentation.
  2. Without witness
  3. Without guarantor.
  4. During cordial relations

 

Soon after giving such loan :-

 

  1. Relations are no more remain cordial
  2. Business started by such money  (easy money belonging to other) invariably fails.
  3. Such loans always sink and not refunded.
  4. Person seeking such refund suffers at legal process.
  5. Person seeking such refund legally or by persualtion is socially criticised.

 

 


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