Debt Recoverey
7 months ago
The issue at hand involves a substantial sum of money, specifically, an outstanding debt of 4 lakh rupees that my father lent to a certain individual. We have a written letter outlining the terms of the loan and a blank cheque as evidence of this transaction.
A.Dear Client,
Since there is no date on an undated cheque so the person holding the cheque is free to present the same on any date by putting a date on the cheque. The Supreme Court in the case of Sripati Singh v. State of Jharkhand, 2021 SCC OnLine SC 1002, decided on 28.10.2021, held that a cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance and that there cannot be a hard and fast rule that a cheque which is issued as security can never be presented by the drawee of the cheque. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified timeframe and issues a cheque as security to secure such repayment; if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if the same is dishonored, the consequences contemplated under Section 138 and the other provisions of N.I. Act would flow. In the case of Sunil Todi v. State of Gujarat, Justice D.Y. Chandrachud observed that a security cheque issued for the advancement of a loan would be mature for presentation upon the default of repayment of a loan. Upon dishonor of such a security cheque, the same would lie under the ambit of Section 138. In view of the aforesaid averments of Apex Court, you need to consult with an Advocate for guidance and steps.
Since there is no date on an undated cheque so the person holding the cheque is free to present the same on any date by putting a date on the cheque. The Supreme Court in the case of Sripati Singh v. State of Jharkhand, 2021 SCC OnLine SC 1002, decided on 28.10.2021, held that a cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance and that there cannot be a hard and fast rule that a cheque which is issued as security can never be presented by the drawee of the cheque. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified timeframe and issues a cheque as security to secure such repayment; if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if the same is dishonored, the consequences contemplated under Section 138 and the other provisions of N.I. Act would flow. In the case of Sunil Todi v. State of Gujarat, Justice D.Y. Chandrachud observed that a security cheque issued for the advancement of a loan would be mature for presentation upon the default of repayment of a loan. Upon dishonor of such a security cheque, the same would lie under the ambit of Section 138. In view of the aforesaid averments of Apex Court, you need to consult with an Advocate for guidance and steps.
Helpful
Helpful
Share
A.Dear client,
According to the Debt Recovery Act, the penalty for violating debt recovery laws can be jail time, a fine, or both. The Act also includes a provision that states the penalty for violation of debt recovery laws can be a jail term of up to two years and a fine of ₹1 lakh.
According to the Debt Recovery Act, the penalty for violating debt recovery laws can be jail time, a fine, or both. The Act also includes a provision that states the penalty for violation of debt recovery laws can be a jail term of up to two years and a fine of ₹1 lakh.
Helpful
Helpful
Share
Read Related Answers
Education Loan
Dear Client,
In the prevailing situation, you need to obtain a course cancellation certification from the institute, and based on said cancellation certificate you need to inform the concerned NBFC t...
Regarding surity and stay of execution
Dear sir,
You have to implead yourself as a party in the pending case if any otherwise file separate case to discharge you from suretyship.
Recovering Loan given to a Friend
Dear sir
As cheques are undated you can file cheque bounce case which is financially feasibly and you need not pay any court fees.
Credit card payment
Dear Client,
You can try to negotiate a debt settlement with the Bank on your own if your pocket permits to repay the entire outstanding of your credit cards at a time for a one-time settlement of du...
Joint account Chaque with minor signature only
Dear Sir,
Please check whether cheque is acceptable with the signature of minor normally it is not acceptable. Please get an endorsement from the Bank and then get issue a legal notice as provided und...
Read Blogs on Debt and Lending Agreement
Debt and Lending Agreement Lawyers
Find Lawyers by Location
