Money lending
Rishi
(Querist) 05 September 2017
This query is : Resolved
My mom lended money of 220000 INR to a neigbhour at an interest rate of 5% per month for construction of house which Worth's 3000000 INR. Borrower paid interest for few months which is a sum of around 80000 INR but from last 6 months borrower is neither paying interest nor returning the principal amount, now we came to know that the borrower is owing money to many people but she is not paying to anyone and the money she owes is more than than the value of the house constructed. What are legal proceedings available to my mother and as well as the borrower?
Arvind Singh Chauhan
(Expert) 06 September 2017
Money lending on interest without licence is totally illegal.
Advocate Bhartesh goyal
(Expert) 06 September 2017
Money lending license is not required for one or two transactions,it requires where person engaged in lending business.You have to file a suit for recovery of money.
Adv. Yogen Kakade
(Expert) 06 September 2017
Do not call it as a transaction out of money lending if you do not have a licence of money lending. DO you have such transaction on paper? If yes.. then file a recovery suit. And if No, then collect the evidences and then go for the suit.
P. Venu
(Expert) 06 September 2017
The money your mother had advanced as a friend and well wisher could be recovered, but not the money she had allegedly lent on exorbitant interest.
R.K Nanda
(Expert) 06 September 2017
file recovery suit in civil court against said neighbor.
Rishi
(Querist) 06 September 2017
can the borrower get a stay from court saying that "I can't pay the debts and claim Insolvency"?
Rajendra K Goyal
(Expert) 06 September 2017
If your mother has proper documents to prove the advanced money to your neighbor, chances of success in recovery suit are better.
Money given at such an heavy rate of interest is very difficult to return.
If court pass a decree, the money can be recovered from his house.
Rishi
(Querist) 06 September 2017
can we at least recover the principal amount if not interest
V R SHROFF
(Expert) 06 September 2017
CAN YOU RECOVER THE AMOUNT??
ANS: It depends on Documents you have, and Documents you can get from neighbour .
You also need proof of your withdrawal of 2.2L and payment to your neighbour.
There are many alternatives, few with lenghthy procedure; few are for quick recovery.. [ all depends on type of Documents prepared/ can procure now]
Dr J C Vashista
(Expert) 07 September 2017
Vital informations are missing from your query, consult a local lawyer.
M V Gupta
(Expert) 10 September 2017
You have not stated whether ur mother obtained promissory note from the borrower setting out the rate of interest etc. If there is promissory note she can file a summary suit under order 37 Rule 1 of CPC to recover the amount. Disposal of such suits does not take much time. But she will not get the interest at the rate mentioned by you as it is exorbitant and hit by the Usurious Loans Act. Further as stated by you if the borrower's debts exceed the value of her property and other assets, she can file an insolvency petition (IP) to save herself the agony of facing multiple suits.by her various creditors.
