Unsecured loan

mukthala@yahoo.in (Querist) 26 August 2013 This query is : Resolved
Dear Expert,
One of my friend had given an unsecured loan of Rs.50000/- with a monthly interest of 2% to a acquaintance 2 years back, with a assurance that the loan will be re-payed back in two months time. That person is now not responding to phone calls and is avoiding my friend. The money was given in the form of 2 cheques, there is no promisory note or any other documentary evidence available.
What are the legal options available to my friend now? Please advice.
Thank you.

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Rajendra K Goyal (Expert) 26 August 2013
Recovery suit can be filed after issuing a legal notice, but following factors should be kept in mind:
a) The cheques were given for loan. There should be evidences to prove it. In absence of written documents it would be difficult to prove.
b) The borrower should have sufficient means so that the money can be recovered in execution proceedings if suit decreed in favor.
c) A stay should be obtained on some of his assets, if possible, so that he can not dispose it.
d) It may take 3 to 10 years or more for complete realization if case is decided in favor.

Guest (Expert) 27 August 2013
Issue legal notice at his known address.

Sudhir Kumar, Advocate (Expert) 27 August 2013
2% p.m. ?
does it make 24% p.a.?
how much more money he lent on such rates?
whether he pays income tax and service tax on this tune?

Most likely your friend is unlicesed money lender. Only persons of unsound credibility take such loans and highly greedy and unscuplous persons give such loan.

Let you friend arrange for court fee (25% of the loaned + interest amount)+ advocates charges + logistic charges etc and file civil suit. Only then he will have a change to prove laon and default before court. Still no guarantee he will get the loan

Further Mr Rajender K Goyal has already advised you.

Raj Kumar Makkad (Expert) 27 August 2013
Well advised by experts.

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