Cheque bounce case
sachin sharma
(Querist) 02 August 2018
This query is : Resolved
A company had financed the auto loan. The borrower stopped paying the EMI. The company bounced his cheque after filling the complete loan amount. Now, if the question raise in a proceeding of 138 N.I. act, if it was a loan on EMI, why the borrower would give you the cheque for the entire amount. What should be the defence for a company against the defaulter on this point.
rajeev sharma
(Expert) 02 August 2018
Go through the agreement. If the agreement gives a right to the finance company to realize the total loan after the default of certain number of installments and the cheque for the total loan amount is presented after that then only then the act of the financier may be defended.
sachin sharma
(Querist) 02 August 2018
Yes, Sudhir G, it was a blank cheque which company has filled. I m advocate in this case from the defence side, i.e. from company's side. Recently joined this company. They bounced the cheque by filling it for complete amount prior to my joining as an advoacte in this company. Now, all these questions are in my mind.
Rajeev Sharma sir, I have carefully analysed the loan agreement but unfortunately no such thing mentioned. Though recovery suit would be another option but 138 N.I. is far better than a civil suit.So, any valuable advice in this scenario.
sachin sharma
(Querist) 02 August 2018
Yes, Sudhir G, it was a blank cheque which company has filled. I m advocate in this case from the defence side, i.e. from company's side. Recently joined this company. They bounced the cheque by filling it for complete amount prior to my joining as an advoacte in this company. Now, all these questions are in my mind.
Sudhir Kumar, Advocate
(Expert) 02 August 2018
when drawer leave any item blank in cheque he gives license t payee to fill it as per his convenience
K Rajasekharan
(Expert) 02 August 2018
A person who signs a cheque is legally responsible for any amount written on a cheque as per the rebuttable presumption under the law unless the person proves otherwise.
On the other hand, a company writing an amount in excess of what is authorised in express terms by the person who signs the cheque is unacceptable as something fair, even though the law does not categorically decries it.
rajeev sharma
(Expert) 02 August 2018
The presumption of liability is always against the drawer of cheque unless proved otherwise by him. But in your case the drawer is liable for the EMI fallen due. The amount which is not due till the date of cheque may not be demanded. If your company is governed by RBI norms of categorization of assets and the loan has been categorized as NPA then full loan may be realized. NI Act is a criminal proceeding not ment for recovery of loan.
Kumar Doab
(Expert) 02 August 2018
The borrower has a right to get authenticated copies of all docs e.g; loan brochure/offer/agreement/statements ….
Approach in person a very able senior LOCAL counsel of unshakable repute and integrity specializing in such/civil matters and well versed with latest citations, LOCAL applicable rules/laws/ … and having successful track record…. and worth his/her salt…..and share inputs /show the documents/evidence for a considered opinion..
At each location three are some counsels that specialize in such matters and they are well known.
Check for such counsels at LOCAL civil courts, HC, SC……
