Ni 138 act, misuse
Vivek Manoj Gangishetty
(Querist) 03 August 2015
This query is : Resolved
Dear All,
Namaskar!
I am from working class, I wanted to take a piece of Land and build a house in Hyderabad, my friend has recommended that I should try Manipal Housing Finanace Syndicate for the Loan, We have finalized a deal for the land and House from a Builder known to the Bank at 30 Lakhs, I have down paid 5 Lakhs and taken a 25 Lakhs loan from the said Bank, with an understanding of the Loan as " Housing Loan", I was later given to understand that the bank has transferred the entire amount to the builder, who has not given us the possesion of the House, but just the land, which does not even value to 12 Lakh Rupees, when approached the bank and told them the same, the Bank has told us that the Matter needs to be settled between the Builder and us, the builder is however not reachable, we have spoken to the Manager there and informed that unless we get our house, we shall not pay any more of EMIs, for which they have not agreed and put in a blank security cheque worth 1,50,000 and invoked "NI 138", the case is sub judice and they have put one more Cheque, which I havent given them at all worth 40 Lakhs and sent me a Legal notice, Please advice what needs to be done?
SAINATH DEVALLA
(Expert) 03 August 2015
What needs to be done is,I don't think that the bank is wrong in its approach and they had gone only as per rules.But the cheque for 40L is something which has to be given importance.
U have not mentioned the dates as to when the transactions took place?Have U received legal notices regarding UR liability? Bank has transferred the entire amount to the builder means they have taken the flat as colleteral security.U have to come out with somemore facts for a better assessment.
Vivek Manoj Gangishetty
(Querist) 03 August 2015
Hi Mr. Devalla,
Namaskar!
Thank you for the response, The Loan was on independent house, the loan was for a fully constructed house in 320 Sq. yds., the land is collateral against the land, the Transaction happened in 2010, the cheque presented was on the 2nd July 2015, they have sent a legal notice under NI 138, which does not mention any liability, which I received on 1st August 2015, the total liability would not be more than 20 Lakhs.
SAINATH DEVALLA
(Expert) 03 August 2015
Can U mention the contents of the legal notice?Is the notice a general repayment notice or a statutory notice issued for dishonour of cheque? If the liability is not mentioned in the said notice,then it is not maintenable u/sw 138 NI ACT.
Section 138 Negotiable Instruments Act as it is at present after coming into force of The Negotiable Instruments (Amendment And Miscellaneous Provisions) Act, 2002:
138. Dishonour of cheque for insufficiency, etc., of funds in the account:
Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice. to any other provision of this Act, be punished with imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the cheque, or with both.
Rajendra K Goyal
(Expert) 03 August 2015
Consult a lawyer and reply the notice.
Lodge FIR against the builder.
Bank has proceeded to evoke the documents it has from you.
Cheque bounce case should be handled by some expert lawyer to gain benefit of any lacunae (if exist) from the Bank in the case.
