Cheque 138

Dear Sir,

Please let me have your thoughts on the appended query related to Education Loan I have taken: -

1. Loan taken date: Oct. 2006

2. Purpose of loan: Higher Studies

3. Duration of the Course: 2 years

4. When the course completed (date): August 2008

5. Repayment started by: December 2009

6. Monthly EMI: 10,000

I have paid till Mid 2012, and due to unemployment and financial crunch at family could not start repayment.

I understand that it is a public money and should be repaid amicably while discussing with Banks but efforts could not succeed.

Guarantor is my mother and she has the pension account with bank therefore they have blocked pension account and sent us a letter stating " we have received a Cheque from Guarantor which shows inefficient fund" in her account hence we will take legal action.


1. I have not signed a promissory note since the loan taken in Oct 2006.

2. Seems they are using cheque book of Guarantor which has been submitted at a time of taking loans. Please suggest what action I should follow as same can be resolved amicably.

Regards, Vishva


If the borrower is defaulting in loan repayment, the bank has rights to proceed against the guarantor but they cannot stop or freeze th pension account.  The recovery cannot be made from pension account, that will contradict the provisions of rights protected by constitution.  Better talk to bank authorities and arrive at an amicable situation to avoid embarrassment to your mother in the cheque dishonor case.


Thanks a lot sir for your valuable input,

One more suggestion required from your end, we have lost our father early while he was on duty in the same bank.

That time Compassionate Ground Appointment Scheme was not there hence we have not taken a single money from bank thinking whenever scheme comes in force will be an opportunity from the Bank.

 Bank Authority at Zonal, Regional and Head Office level have always communicated no policy once come up consider your case.

Now when new circular came in, old cases are not included and bank says only people who dies after 05/08/2014 would be considered.

Waited so long and now we have to listen their message as " either you reach prime minister, that's even not going to solve your case"

please suggest what legal measure we can take


You have done a blunder mistake of waiting for the one which is not there and only on the false assurances. You cannot blame somebody for your own irresponsible act.  The government's policy, until it is seen  in black and white, cannot be guessed as to ow it will take a shape.  I dont believe that any further efforts in this regard by you may fetch a fruitful result, instead, avail of the terminal benefits which are due to your father immediately so that it is not barred by limitation.


Thank you very much sir for your suggestions and time spent to resolve our issues.



Read Sec.60 of Civil Procedure Code, 1908...there are certain properties which cannot be attached even by Court in execution of a decree.  Pension to a old aged woman must surely be one amongst them.  Banks do not initiate criminal proceedings under Sec.138 for default loans generally, they only take recourse to selling of securities if they are mortgaged or pledged.  Pay some good amount into the account and then start negotiating.  But do not think that on the ground of lapse of AOD period you can have advantage of limitation, because the fresh limitation period always starts with last payment date or the bank had taken additional blank AODs at the time of giving loan to you which they will fill up and produce in court when your case comes up.



Is there any rule that you as legal heir of your father should not take terminal benefits if you are to avail an opportunity of employment in that bank on compassionate grounds?  I do not think there would be any such rule.  May be it is your personal view that if you behave like a good samaritan not taking money due from bank they feel compassion for you and offer you a job.  It never happens like that don't mix up feelings with law, they never work.   My view is there is no link between the two unless there is some rule stating so.  Apply for terminal benefits as legal heirs of your father immediately. 


Thanks a lot for your guidance,

I've heard most of the cases related to cheque dishonor (138 NI) always won by Bank is it so.

Morally, I may be in approaching wrong way of handling or communication with Bank but what would be the way If left with no option but to defense the case.

Cheques has not been issued to the bank in recent months, what they are using is blank cheque book issued at the time of taking loan in Oct. 2006.

No AOD's signed in last 7years.

Thanks & Regards,





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