I want to sell goods to a new party. He is asking for the for 15 days credit for the payment. So i decided to give credit against check. What precaution should i take for this deal so that the other party cant faud with me. The bill amount is around 35000 so eway bill will not available. What other security steps can i follow to do this business safely?
1. There has to be a adequately stamped written agreement signed by both parties, in which you can mention the sale of goods to him for Rs. 35000/- and you have obtained Cheque No...... drawn on.......Bank on........date.....for the amount from the buyer, towards sale consideration for the goods you are selling to him.
2. Above procedure is required to be done followed in case the Cheque bounces and if so, you can file a case against him U/s. 138 of N.I. Act to recover your money.
Dear client,
When offering credit to a new party, it's important to take precautions to ensure that you're protected from fraudulent activities. Here are some steps you can take to safeguard your interests:
Verify the party's identity: Before agreeing to any credit terms, make sure you have verified the identity of the party you're dealing with. Ask for their name, address, and phone number, and check them against a government-issued ID or a business license.
Get a written agreement: Have a written agreement that outlines the terms of the credit deal. This should include the amount of credit, the payment due date, and any late payment penalties or interest charges. Make sure both parties sign the agreement.
Use a check as payment: Since you've already decided to accept a check as payment, make sure it's from a reputable bank and that there are sufficient funds to cover the amount of the check. You can also consider using an electronic funds transfer (EFT) instead of a check.
Follow up on payment: Once the due date has passed, follow up with the party to ensure payment has been made. If the payment is late, you can send a reminder letter or call them to remind them of the payment due date.
Use a collections agency if needed: If the party doesn't make the payment or if the check bounces, you can use a collections agency to recover the funds. Make sure you have all the necessary documentation, including the written agreement and any correspondence related to the credit deal.
Consider security deposits or guarantees: If you're still concerned about potential fraud, you can consider asking for a security deposit or a personal guarantee from the party. This will help ensure that you're protected in case of non-payment.
By following these steps, you can help protect yourself when offering credit to a new party.
You enter into an agreement with him towards this sale with terms of payment, legal action on default in payment etc.
You raise invoice and get the delivery receipt signed by him and obtain the cheque for payment.
Hello,
Obtain letter from party authorising you to deposit cheque after 15 days
Invoice is necessary as proof of nature and delivery of goods. In case cheque bounce, you can file case u/s 138 N I Act.
If i make an agreement for 12 payment (for each month and each payment is 35000 rs) ... how much amount of stamp is sufficient? I am thinking one agreement for whole year ... just fill detail on every month ... check .. bank ... due date etc Is it possible?
it can be by exchange of letters wherein you request him to pay rs 35000 per month and in reply he agrees to do so
not necessary that you need agreement on stamp paper
It will on 100rs stamp. Notorised is sufficient.
Is it possible? YEs
Stamp Duty is a State subject and differs from one State to another State. Therefore you have to obtain the details of Stamp Duty from your State' Sub Registrar's Office of your jurisdiction.
The stamp duty will be for the total agreement amount and not for the 12 monthly payments.
Do not take any step in haste on false rumours or misguidance.
You can proceed as suggested by various experts instead of getting confused over your own fancy ideas.
It’s better job take pdc cheques from him in said case else you need to file civil suit if he regfuses
Execute an agreement and take security cheques from him in advance and sell your goods. If he default in making payment than you may present the security cheques for encashment and in case of dishoner of cheques you may file a criminal case against him before the magistrate court under section 138 of NI act.
Feel free to call
Stamp duty requirements vary by location and the nature of the agreement. In India, stamp duty is levied on the value of the agreement and varies from state to state.
Assuming you are in India, if the agreement you are making is a monthly payment plan for a year with each payment being 35,000 INR, the total value of the agreement would be 4,20,000 INR (35,000 INR x 12). To determine the required stamp duty, you would need to check with the state government where the agreement is being executed, as each state has its own stamp duty rates and requirements.
Regarding the possibility of having one agreement for the whole year with details filled in for each month, it is possible to have such an agreement, provided that it is executed correctly and meets all legal requirements. However, it is important to ensure that the agreement is clear and includes all necessary details, such as payment terms, due dates, and consequences of default, to avoid any misunderstandings or disputes later on.