138 n.i.act

He has to prove that he has got so much of amount.

Mere saying he lent so much does not sffice

Cheque need not be entirely written by the drawee only.  Signature is sufficient and if rest of the contents are filled by third party, it is acceptable to bank, it is general banking practice.  Hence forensic test is of no use.

Your friend should reply to the notice saying, the amount mentioned does not constitute a legally enforceable debt, because the drawer of cheque had never indulged in any transaction which makes him owe such huge amount of money to the payee.  The drawer of instrument could not have given the cheque after closure of account, because the bank closes the account after having taken back all the cheque books and cheque leaves if any pending with the customer. The cheque was stolen from the cheque book and subsequently as account was closed in 2010 no need was felt to issue stop payment instruction to the concerned bank.  If that is a legally enforceable debt, then any such (big) transaction amounting to Rs.28.00 lacs should at least be supported by some promissory note (if it is a debt) or bills of exchange of hundi (if it is a trade transaction).  If any such document is there, the copy of it may be forwarded to the alleged drawer of instrument. 

Sec 138 of NI Act applies to "discharge, in whole or in part, of any debt or other liability". "Debt or other liability" means a "legally enforceable debt or other liability". The questions that arises are:

1) Was the fact that your friend had taken a loan documented? Meaning - was there any loan agreement? If no, then it is virtually impossible to prove that any loan was taken, and the terms and conditions of repayment are also virtually impossible to prove. (Oral agreements are legal but how is the loan giver going to prove it?) 

2) There are specfic guidelines as to how to send notices u/s 138 and the time frame within which notices have to be sent.  Has the notice that your friend received been served within the time frame? If no, sec 138 is of no use.

3) Was the blank chq undated? This is important because if the chq was dated and it was presented after the expiry of 6 months from the date, sec 138 is again not applicable.

4) What was the Rs.100/- stamp paper for?

It is surprising that people make such callous mistakes and then face troubles. Your friend should immediately visit a competent lawyer and seek advice.

Regards

Prasun.

On Chandrasekhar's comments:

1)Cheque need not be entirely written by the drawee only.  Signature is sufficient and if rest of the contents are filled by third party, it is acceptable to bank, it is general banking practice: FULLY AGREE

2) The drawer of instrument could not have given the cheque after closure of account, because the bank closes the account after having taken back all the cheque books and cheque leaves if any pending with the customer: DISAGREE. This is no longer the case. If the customer writes in the a/c closure form that all unused chq leaves which are not being submitted may be destroyed, the banks shall destroy in its software all the unpaid chq leaves, whether returned to the bank or not at the time of a/c closure.  

Cannot and should not comment on legal issues because both Mr Rajeev and Mr Chandrasekhar are in the legal profession and I am not. Pls ask your friend to personally see an advocate.

Prasun.

thanks sir..account was closed by bank because it has not been used for long time.no transaction take place in that amount,

there is no promisory not or any proof regarding transaction as it has not been taken place in actual....that may be different if he make forged document.. as cheque was lying with that guy since 2006.

i think 28 lac is very big amount and court will not accept case without having adequate proof.

or court accept every case???please advise us lawyer becouse this is being done by that person with the help of his lawyer friend(u can say young lawyer who can misguide people aroud them to misuse the law)

Court will accept the case but burden lies on him to prove that he is got so much financial capacity.  Cross examination is very important, mere denial is not sufficient.  It is good case to contest, but cross examination should be done very intellegently.

@Prasun Chandra Das:  Johny had given the information that account closed due to lack of transactions in the account in the second mesg.  Based on earlier mesg, I had given him the suggestion to claim, "The drawer of instrument could not have given the cheque after closure of account, because the bank closes the account after having taken back all the cheque books and cheque leaves if any pending with the customer. The cheque was stolen from the cheque book and subsequently as account was closed in 2010 no need was felt to issue stop payment instruction to the concerned bank."

These two sentences should not be read in isolation.  These two statements mean that the Drawer went to close the account, bank asked him to surrender cheque book, he informed about stolen cheque to the bank and asked bank to take "stop payment instruction", but bank informed, as the account is being closed, stop payment instruction cannot be taken for that cheque.  So no letter of stop payment given to bank, no acknowledgement taken.

Now the cross would be like this:

Petitioner advocate :  You have written it is necessary that cheques should be surrendered to bank to close the account. It is not necessary to surrender cheque in order to close account.   Is it not?

Respondent :  I don't know.  As bank specifically asked me to surrender cheque book, I inquired it is mandatory to surrender cheque book, the official closing my account said "yes". 

Petitioners advocate :  Why didn't you take care to issue stop payment letter to bank if you had known that the cheque was stolen?

Respondent:  I told the bank to issue stop payment the day I went to close the account.  That the cheque was stolen came into my notice only two days before closing the account.  I went to bank to give stop payment, bank advised me to close the account as there were no transactions.

Petitioner's advocate: Why didn't you think it was merely lost?  What made you think it is stolen?

Respondent:  I am generally very careful about the cheque book.  If anything is lost, it is definitely the act of some thief only.  That is why I say, it is stolen.  I used to leave the bag containing cheque book on the table of the petitioner's office and go out with him to have coffee.  He would have told someone to steal it.

WHAT ABOUT RS. 100/- STAMP PAPER, IS IT THAT ALSO BLANK OR WRITTEN, IF YES THEN WHAT`S WRITTEN IN IT. KEEPING THE STAMP PAPER AT ONE SIDE FOR A MOMENT TAKE UP ONLY THE CHEQUE,  WHICH IS SIGNED BUT NOT FILLED IN STILL ATTRACTS 138 NEG. INS. ACT.   MERE CLAIMING THAT ITS STOLEN WILL NOT HOLD ANY WATER. UNLESS OTHERWISE ITS PROVED THAT YOU HAVE LOST IT. 

INSTEAD YOU TAKE A CORRECT STEP THAT YOU HAVE TAKEN LOAN AND REPAID AND LEFT THE DOCUMENTS WITH HIM ( STAMP PAPER & CHEQUE) LEFT WITH OUT BEING COLLECTED/ RETURNED.

ON THE OTHER SIDE EVEN YOUR FRIEND ALSO MUST PROVE THAT(burden lies on him to prove), WHAT FOR THE CHQUE AMOUNT OF SUCH AN AMOUNT IS RECEIVED BY HIM. ( IS THERE ANY LIABILITY STANDS AGAINST YOU)

IT`S BETTER YOU GO TO AN ADVOCATE WITH ALL YOUR DOCUMENTS AND EXPLAIN THE ENTIRE CIRCUMSTNCES.

Advocate will give you the advice which will be according to your requirements and limitations.

as far as i know private lender take stamp and cheque.my friend also did the same .

my point is i know my friend did mistake by not taking stamp and cheque BUT CAN anyone file a suit under 138 if he is having cheque and blank stamp.(there is no other evidence which shows there is any transaction) and fill big AMOUNT LIKE 28 LAKHS?

ihow he will pay that big amount if he found guilty which he is not?

PLS READ HERE THAT I DESCRIBED THE FINANCER AS YOUR FRIEND( that guy,) (SORRY FOR THE MISNAMER)

ON THE OTHER SIDE EVEN YOUR FRIEND(that guy) ALSO MUST PROVE THAT(burden lies on him to prove), WHAT FOR THE CHQUE AMOUNT OF SUCH AN AMOUNT IS RECEIVED BY HIM. ( IS THERE ANY LIABILITY STANDS AGAINST YOU)

FINANCER MUSTPROVE THAT HE HAD LEND MONEY AND SUCH HUGE MONEY IS DUE TO HIM. AND ALSO VERIFY THAT IS HE  A LICENCED FINANCER OR NOT.

mr chandrashekhar in criminal cases there is no cross of accused.

@JSDN - advocate DEFENSE:  accused can also be a witness

criminal advocate please explain the concept of criminal trial  and how it is conducted to Mr Chandrashekhar.