Complaint under section 138 NI is maintainable
2) also file complaint t of cheating and criminal breach of trust against developer under section 406,420 of IPC
3) it would not attract money lending act
Cheating by Developer
Sir, I have invested amt of ₹ 2 Cr with a Pune based Developer through Notarized MOU,agreed return on invstmnt was18%pa.He agreed to give 2 underconstruction flats from his project & to Buy-Back them after 1yr.The Developer also made a Notarized agreement to give me Power of Attorney for the said 2 flats until final payment is made. Developer made partial payments during the yr but could not make full payment.He requested extnsn multiple times. With each extnsn request,he provided security cheques with revised payment amount as per agreed terms. Developer revoked PoA by sending a letter & gave some other undrconstruction flats as collateral & promised to close transaction in next 4 mnths.(for some of these flats he did not get permission from PMC & hence were not constructed) Once again,Developer requested for another extension,after taking request letter & fresh PDCs.(I had no option but to cooperate with d builder).This time Developer offered his Shares (equivalent to amount payable)(via a signed agreement without Notarizing it). He said their Pvt Ltd Co.was about to be acquired by another firm & his money will get released which he can use to pay me back.The last extension was done in July 2022. After this Developer started avoiding meeting n phone calls,so we had to deposit the security cheques as validity expired in Oct 2022.All cheques were Dis-honored. I sent a legal notice for the same U/s 138. Developer replied to this notice saying that he was expecting an interest rate of 9-11% pa & he has already paid the interest+principle amt based on his assumption & the cheques were for security only. Developer now is threatening to take legal action under Maharashtra Money Lending Act as excessive interest is charged.We supported the Developer for more than 4 yrs & now he is playing a new trick to avoid balance payment.The original MOU clearly mentions 18% interest as agreed return on invstmnt,also he has repeatedly provided cheques with calculation as per 18%. We need your advice on following points : 1. We had to deposit security cheques since Developer stopped comunication since 3 mnths & had regularly failed to keep his promises. Hope we can take action U/S 138 2. Our investment was for a period of 12 mnts against 2 flats which we did not get, the same were sold without paying the agreed amnt. PoA for these said flats was revoked by Developer without consent. Other flats given as collateral too were never constructed as permission could not be obtained.Can I lodge a Criminal case against Developer? 3. Developer offered Collateral rights on his Share in a Pvt Ltd Co,which is now acquired by another Public Ltd Co., How can we Protect my interest/ Create our charge on his receivable amt.in the deal & Block his payment to be made to him by d acquiring co.? 4. Invstmnt on a Notarized MOU with agreed rate of interest,why shud it attract Money Lending Act? Kindly advice on above questions n any Other Options to recover my amnt.Thanks
Asked 2 years ago in Criminal Law
Religion: Hindu
7 Answers
1. You can proceed with the filing of the cheque bounce cases because the cheques issued for security purpose also attracts the provisions under section 138 NI Act.
2. If it is found to be an act of cheating, you can lodge a criminal complaint against the developer for the commission of the said offence.
3. If you have documentary evidence towards the collateral rights in your favor you can issue a legal notice to the public limited company and demand them to pay the amount directly to you in proportion to your rights or shares in the company.
4. He is taking it as a defensive weapon agaisnt you to threaten you that he will take action under the provisions of money lending act, however it will not attract any action under the said actbecause it was an investment and not an act of money lending and you have documentary evidence to prove the same, hence you may just ignore his threats.
- Cheques are not against security, cheques are issued by discharge of investment.
- Sell of agreed flats and cancellation of POA is an offence of cheating under Section 420 with documentary proof of cancellation of POA. You also have evidence failure to construct agreed flats.
- This is clear case of fraud under Companies Act, you can file a criminal complaint for fraud under Section 447 of Companies Act, 2013 in the designated Court under Companies Act. Designated Court is located in Pune.
This is investment in business not lending of money against the Money Lending Act
Dear client I am sorry to hear that but in this case you can approach RERA and register a complaint against them.
Thanks a lot for your advice! Would appreciate if you can clarify on below queries too : 1. Can we lodge separate complaints against developer for : A) PoA revoked & flats sold without consent. B) Other flats given as COLLATERAL .. Which are NOT CONSTRUCTED. 2. TO BLOCK DEVELOPER'S PAYMENT (BY ACQUIRING PUBLIC LTD. COMPANY) : A) Can we approach NCLT National Company Law Tribunal for getting a STAY ORDER to BLOCK d further payment to Developer B) To pay our receivable share Direct to us? 3.A) How can I create a charge on a flat given as COLLATERAL ? (which seems to be still with Developer). B) Can I create a charge on any other assets he possess. Developer is enjoying Anticipatory Bail in some earlier cases registered against him U/sec 406 , 420 n 438. Since similar type of cheating is repeated in my case , can Hon. Court cancel his earlier Anticipatory Bail ? Thanks again
Asked 2 years ago
Court would consider fact that earlier cheating cases have been filed against him and deny him anticipatory bail
2) his earlier bail may not be cancelled
3) file case of cheating,criminal breach of trust against builder for having sold flats without consent
1. If it is related to a separate incident then you can lodge a criminal complaint for the offences of cheating and breach of trust, this will be separate from the cheque bounce cases.
2. Instead of approaching NCLT, you can file a suit for permanent injunction against the developer and his new company restraining them from receiving any money or further encumbering or alienating the property in any manner.
3. You may have to file a money recovery suit in which you can file an application for attachment before judgment to attach the properties he owns towards security for your money.
4. The anticipatory bail granted earlier cannot be cancelled for this reason.
You can get his ABA cancelled showing his antecedent
