Loan

sajid patel (Querist) 19 October 2017 This query is : Resolved
Respected sir/madam, I have given some amount of money to one of the friend on his request, but now he has no intention to give it back to me. The money was given by cheque and money transfer. He did gave couple of cheques in return for first couple of month but stopped after that. Still 95% of the amount is remaining, please advice me is there any legal action I can take against him. There is no written agreement between us but I want my money back, please help, thanking you.

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Sudhir Kumar, Advocate (Expert) 19 October 2017
Money given to friends and relatives is always a charity in the garb of loan which is given in expectation of refund but always taken with intention of non-refund.

Such loan is taken by a person:-

(i) Who lacks business sense and cannot raise funds out of his own business and suddenly wants to be rich.

(ii) who cannot raise bank loan because :-

Either
he himself is not creditworthy

Or
the purpose for which he seeks loan is illegal

or
the purpose for which he seeks loan is not at all commercially viable.

(iii) Who knows he can afford not to refund.
(iv) Who trusts his thick skin
(v) Who intends not to refund
(vi) Who has made fortification against action of refund.

So he has to find someone who can part with his money. SO he finds a lender near him (friend or relative)

Such loans are given by the persons :-

(i) Who has surplus money.
(ii) Who displays and boasts of such surplus money.
(iii) Who stupidly believe that there will be a refund.
(iv) Fails to realise as to why he alone (not bank) is being contacted for loan.
(v) Who has extreme trust on the debtor
(vi) who are either stupid or extremely greedy of the unusual (or illegal) rate of interest.

Such loans are always given

(i) Without documentation.
(ii) Without witness
(iii) Without guarantor.
(iv) During cordial relations

Soon after giving such loan :-

(a) Relations are no more remain cordial
(b) Business started by such money (easy money belonging to other) invariably fails.
(c) Such loans always sink and not refunded.
(d) Person seeking such refund suffers at legal process.
(e) Person seeking such refund legally or by persualtion is socially criticised.

adv. rajeev ( rajoo ) (Expert) 19 October 2017
Burden lies on you to prove that you had given a hand loan to your friend. Only thru., the cheques you cannot, so try to get hand loan chit from your friend or try to take another cheque from him.

P. Venu

(Expert) 19 October 2017
A civil action could be initiated if the matter is within period of limitation.

Dr J C Vashista (Expert) 20 October 2017
Issue legal notice followed by filing a suit for recovery through a local lawyer if you have adequate evidence to prove the loan.
Whatsoever, advancing loan to a "friend or relative" should be considered a charity even before advancing the amount.