Banking
Querist :
Anonymous
(Querist) 18 January 2012
This query is : Resolved
My friend had availed personal loan from citi financial.citi financial had taken five security cheques on a condition that it would not deposit them without intimating him. The mode of repayment was ECS. citi financial did not furnish the copy of the loan agreement and other documents despite several requests. Due to recession when My friend lost his job he requested citi financial not to deposit the ECS but citi financial bounced the security cheques given & sent the notice under section 138; which was duly replied that those cheques were not meant for repayment of the loan and the customer should have informed before depositing them. But still citi financial has filed case under section 138 against him. what are the legal remedies available to get the case dismissed as this is clearly the matter of breach of trust & mental harrassment by citi financial?The cheques given were signed blank.
Raj Kumar Makkad
(Expert) 18 January 2012
Have your friend any writing from the bank that those cheques are only for the security and shall not be encashed without permission of your friend. I think your friend has no such writing so it is difficult to take this plea for the defence of your friend.
If citi financial had not provided the demanded copy of loan agreement, your friend might have taken legal recourse like sending a legal notice and approaching RBI.
Even today, your friend can approach RBI because citi financial is NBFC directly controlled by RBI and should redress his grievances though there are very little chances to get justice there from without having any document in hand but your friend should try seriously.
H.M.Patnaik
(Expert) 19 January 2012
Adequately advised.
Deepak Nair
(Expert) 19 January 2012
Yes. You are rightly and sufficiently advised by mr.Rajkumar.
You have strong grounds as your defence. You had given blanc cheques which were later filled up by citi finance and deposited even though your mode of repayment was ECS. You can take the defence of manipulation in the cheque which was issued as security cheque.
malipeddi jaggarao
(Expert) 19 January 2012
First of all, no bank is generally interested to drag its customers to court of law on frivolous grounds. You are linking the matter of not providing copies of documents signed by your friend to the default. What is relation between these two? Unless your friend is having something in writing about presentation of cheques as you were claiming, that will not be a defence at all. The problem is when there is default, the borrower avoids meeting the Bank, finally forcing it to take its own decision for recovery. If the default is not wilful and based genuine reasons, a proper representation should be made to the Bank by meeting the officials personally, assuring them, the repayment will be made the moment the position is improved, the Bank can find a way out. It can reschedule the instalments. If the borrower completely stops repayment, Bank will also not help him, as it has to recover the money lent, because the money is its own, but belongs to depositors. Even now, you can have a reconciliation with the Bank by depositing part of the defaulted amount and request the Bank to reschedule the instalments.
