1) issue legal notice to pay your outstanding dues with interest
2) you can demand interest rate on principal amount till date
3) you can deposit cheques . if dishonoured you can file complaint under section 138 NI
Borrower not returning overdue amount (approx 8-10L) for over 2 years now
I have lent rupees 8 Lakhs to a person in June 2020, with an agreed rate of return was 5% per month and all amount was expected to be returned in around 6 months, all to be cleared maximum by Feb 2021 ( 8 months). However they have cleared part payment only, Rupees 5.5 lakhs ( including interest) , so still more than Rs. 4 lakhs payment is due and if I take interest of 5% , the due is nearly Rs. 10 L. Despite my regular follow up with them through emails, WhatsApp messages and phone calls. Most of the time they will not pick the phone. If once In a while, they always say they are trying, they are working on it, they give some dates but will slip. T they have not paid anything for last 8-9 months and I don't think they intend to pay and outstanding is nearly 10 Lakhs. They have issued PDC cheque with 4L , 4L and 2L which is with me. My 3 questions 1. Can you advise what best action can be taken to get my payment back with interest. 2. They have accepted to pay @ 5% interest. I know it is high compared to general interest rate. Can I demand same interest rate on total principal amount till now, or can the court say that interest rate is not acceptable, and I can be challeged. 3. What kind of legal notice /action be taken against them to have pay my overdue money. Kindly advise. 4. Can I deposit the cheque and if it bounce, do I take Cheque bounce case route, but not sure, if it really will yield any result For reference to what agreement exist between us. Here is summary. If required, I can share complete MOU copy An MOUs was signed to lend money to Mrs. XXXX (representing a propriterosriship firm resgitered in Hyderabad) and second party ( i.e. me as an individual investor) on Rs. 100 Non Judicial stamp paper and signed by her and her husband as witness on 27th June 2020. They are based in Hyderabad.
Asked 2 years ago in Criminal Law
Religion: Hindu
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12 Answers
1. You can fill up the cheque, get it bounced and then you may proceed with cheque bounce case.
But remember that the interest @5%per month is exorbitant and not maintainable in law.
2. Since your interest rate is exorbitant, he may lodge a criminal complaint against you for charging exorbitant interest for which, if found guilty. you may be punished.
3. Read the first answer above.
4. You can.
1. Since, you have PDC cheques , then on the date written on the cheques you can present the same before the bank for encashment
- If bounced , then you can file a compliant against him before the court for getting refund of the amount.
- You can also file a recovery suit before the court for getting refund of the amount with interest.
2. You can claim the amount as mentioned in the cheques.
3. Before filing the above cases , you can send him a demand legal notice
4. Take steps as mentioned in earlier reply
- If cheque dates are within 90 days, present the cheques, after return of cheque issue a lawyer's notice within 30 days after intimation giving fifteen days’ time, thereafter file a criminal complaint for bouncing of cheque.
- On the basis of cheques, file a summary suit in which the defendant need to give security in the court for the amount claim within ten days failing which Court will decree the suit.
- File a regular suit fore recovery of money, and seek attachment of properties of borrower. You get such attachment order immediately.
- Only a licensed money lender can demand interest of sum lend. You cannot demand any interest.
1. You should first try to resolve the issue amicably with the person who borrowed your money. Reach out to them and ask for repayment of the loan. If they are not willing to pay back, you can send them a demand letter, with a copy of the MOU, stating the amount that is due and the date by which payment needs to be made. If they don't respond, then you can file a civil suit for recovery of the amount due and interest at the appropriate court of jurisdiction.
2. The court will determine the amount of interest that is due, taking into consideration the rate of interest agreed upon in the MOU, the amount of time for which the loan was taken, and prevailing market rates.
3. If the borrower has issued post-dated cheques, then you can proceed to encash them. If the cheques are dishonoured, then you can file a complaint against them under Section 138 of the Negotiable Instruments Act.
4. You can also approach the police to register a criminal complaint against the borrower for the offence of cheating, if there is sufficient evidence to suggest that the borrower has been dishonest in the repayment of the loan.
I am also available now in Qatar. You can book an appointment through this website for legal consultation.
1. Civil suit for recovery
2 yes
3. Send legal notice for recovery of money else file suit
4. Yes if you have cheque you can bounce and file criminal case of cheque bouncing after giving notice under 138 of NI Act
5. Yes yoy can share take legal advice and act accordingly
Based on responses, below 3 follow-up questions, pls advise. 1. Legally, how much maximum interest is permitted per month or per year. Is 5% per month acceptable or let me know the limit I should keep. They voluntarily offered 5%, so, we agreed, but I don’t want that this 5% is seen as high amount and I have any other kind of issue. Will charging that 5% is considered illegal as mentioned by one of the lawyers below. 2. Pls note that the cheque they have given are for 4L and 2L, and it has no date, which we agreed that I can fill the suitable as needed. Can I fill it or is it must that , only the issuer of cheque should fill the dates 3. One of the responses said, “ Only a licensed money lender can demand interest of sum lend. You cannot demand any interest”. I am an investor(as agreed in contract), based on that, we agreed for this return. a. Will it be legal to have this agreement at 5% return, or , does it mean, I can’t get any interest. b. Will there be any issue for me lending money( or investing) at an interest, as I don’t have license to lend money ( as I was not aware that we need license to lend money) c. Then can I get at least my principal amount, or not even that ?
Asked 2 years ago
it is usurious rate of interest .
2) better ask issuer of cheque to fill in dates .
3) you are not carrying on money lender business . it is only occasional transaction . you dont need money lender licence
4) you will get interest but not at 5 per cent per month
5) you will get your principal amount back
1. Charging 5% interest per month is considered as an exorbitant interest and punishable under the prevention of Exorbitant interest act. Maximum interest tht you can claim legally would be 2% per month on the principal amount.
2. You can fill the date in the cheque as per your convenient.
3. Investment if different to that of lending money.
a. Even though there may be an agreement between you and the opposite party, you cannot charge an exorbitant interest as return of your investment. The interest amount should not exceed 24% per annum.
b. The interest you have quoted is illegal and exorbitant
c. You can very well get back your principal amount and the interest towards the principal amount to the extent of 2% per month.
You can change as per interest Act
Yes you can file the same by bouncing the cheque
You can show you have given a friendly loan to him on agreed interest
If he has agreed to that percentage then yes.
You can definitely get principal
1. Legally , you cannot charge 5% interest per month , and court generally allowed maximum 9% annual
- However, out of the court , you can take agreed for this interest rate
2. If the said cheques are dully singed by him , then you can also write the amount and date over the cheques .
3. Yes, for getting refund of the amount , you should not show that you are working as a money lender without having a licence for the same.
Dear client,
Legal action can be taken against the borrower to recover the outstanding amount along with interest. You can send a legal notice demanding payment of the outstanding amount along with interest, and if they fail to respond, you can file a civil suit for recovery of the amount in a civil court.
The interest rate of 5% per month is on the higher side, but if it was agreed upon by both parties at the time of the loan agreement, it can be enforced. However, if you want to claim interest on the principal amount at the agreed rate till now, you will have to take the matter to court and prove that the borrower had agreed to pay the interest on the principal amount.
You can send a legal notice to the borrower demanding payment of the outstanding amount along with interest. If the borrower fails to respond or pay the amount, you can file a civil suit for recovery of the amount in a civil court.
Yes, you can deposit the cheques and if they bounce, you can initiate legal action against the borrower under the Negotiable Instruments Act. However, it is important to note that the legal process for cheque bounce cases can take time and there is no guarantee of recovery of the amount through this route.
It is recommended that you consult with a lawyer to understand the legal options available to you and to take the necessary steps to recover your money.
