Suit u order 37 cpc against legal heir against dishonored ch

Madhu Mittal (Querist) 18 January 2020 This query is : Resolved
A loan is given to Mr. borrower on 25.04.2017 by taking in repayment a post dated cheque dated 25.04.2018 when presented on its date, it returned with remarks a/c freeze. When notice u/s 138 was issued, It has come to our knowledge that he expired on 21.03.2018 i.e. before presentation of cheque in Bank on 25.04.2018.
Last payment of interest by cheque was on 06.02.2018.
1. Whether suit under Order 37 CPC can be filed on behalf of this returned cheque of borrower against his legal heir i.e. wife.
2. If yes, whether notice u/s 80 CPC is to be issued again or notice u/s 138 earlier issued was sufficient.
3. Any other remedy.

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Quick Summary

This discussion explores the complexities of pursuing legal action against a legal heir following a dishonoured cheque, particularly when the original borrower passed away before the cheque was presented. It questions the maintainability of a suit under Order 37 of the CPC against the legal heir, considering whether prior notice under Section 138 or 80 of the CPC is sufficient. The consensus leans towards pursuing recovery against inherited property rather than directly against the legal heir, with advice to consult a local senior counsel for specific guidance.

P. Venu (Expert) 19 January 2020
The claim lies not against the legal heir of the deceased, but against the property, if any, inherited by the legal heir(s) of the deceased.

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Dr J C Vashista (Expert) 20 January 2020
Since the borrower is no more, no case can be made out against such deceased person, hence no case or notice Section 142/138 of the NI Act, 1881 is maintainable and filed..
Notice u/s 80 CPC may be issued to all LRs of deceased borrower.
Whether suit u/o XVII Rules 1 & 2 is maintainable against LRs of deceased borrower, simple answer is "NO" if I am correct?
Under such circumstances straight case for recovery may be suitable.
It would be advisable to consult a local senior for better appreciation of facts/ documents and guidance.

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Sb Karma (Expert) 20 January 2020
Try to recover by his property,not direct by legal heir(wife).Consult local lawyer.

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Raj Kumar Makkad (Expert) 20 January 2020
You similar query already stands addressed by various experts so there is no need to repeat again and again.

T. Kalaiselvan, Advocate (Expert) 28 January 2020
Order 37 Rule 1 of Sub Rule (2) provides as under:

"Subject to the provisions of subrule (1), the Order applies to the following classes of suits, namely:

(a) suits upon bills of exchange, hundies and promissory notes;

(b)suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising,

(i)on a written contract; or

(ii)on an enactment, where the sum sought to be recovered is a fixed sum of money or in the nature of a debt other than a penalty; or

(iii) on a guarantee, where the claim against the principal is in 3 respect of a debt of liquidated demand only.

(iv) suit for recovery of receivables instituted by any assignee of a receivable.

Aug 29, 2017 - AIR 2002 MADRAS - 296, it is observed that "In a suit for recovery of amount filed against legal heirs of borrower, on basis of pronote, there is nothing to show that said heirs though related to maker, have inherited his estate, so as to become liable to repay the debts and as such suit is not maintainable."

Suit on basis of cheque against legal heirs of deceased

Section 29 and 29A of Negotiable Instruments Act 1881….. Order VII Rule 10 and Order XXXVII Rule 2 and 3 of Civil Procedure Code 1908….. Summary suit against the legal heir of the executant of negotiable instrument— Maintainability—– plaintiff filed suit for recovery of money on the basis of cheque whose maker died before encashment of the same— suit was dismissed by the trial court— validity— Maker of cheque had died before the same could be presented for encashment— said cheque has ceased to have any effect as a bill of exchange on the death of its maker —- summary suit cold only be filed against the executants of bill of exchange hundies or promissory notes and not otherwise— party who has not a drawer or maker of the cheque bill of exchange was ot liable thereon and he could not be sued under order XXXVII rule 2 and 3 CPC—- Legal representatives of deceased must sign the instruments in order to make them liable thereunder—- defendant s has not signed the disputed cheque they were not liable to be plaintiff against the cheque issued by their predecessor

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Madhu Mittal (Querist) 06 February 2020
Respected Sirs, thanks a lot for guide me by giving your valuable time, special thanks to Sh. T.kalaiselvan, who guided with citation to avoid litigation if one does not have information about the estate of died person.

T. Kalaiselvan, Advocate (Expert) 06 February 2020
you are welcome for your appreciations especially happy to note that you are relieved by my reply/opinion to your query

Madhu Mittal (Querist) 16 January 2021
Respected Sirs,
Please guide where deceased borrower died before institution of suit and suit is filed against legal representative, whether the onus of proof whether legal representatives got any property in inheritance or not to be decided in 1. Suit itself or in Execution Proceedings, and 2. If decided in Suit itself again, onus of proof whether legal representatives got any property in inheritance or not is on the lender or on legal representatives 3. If decided in Executing Procedings again, onus of proof whether legal representatives got any property in inheritance or not is on the lender or on legal representatives.
I am requiring this as I found a citation that is complete reverse what was decided in (Govindammal and Anr. vs. Bhuvaneswari Financing Corporation (19.10.2001 - MADHC) AIR2002Mad296 in this citation it is decided, the onus on lender as well as it should be decided in Suit itself. While in below mentioned citation it has been decided that this will be decided in executing process.
Please have a look on it at Para 31...:
M/s. Technica International Engineering Pvt. Ltd. and Ors. etc. etc. vs. Kokan Mercantile Co-op. Bank Ltd., Mr. Masood Mahmood Rakhe and Mrs. Sofiya Masood Rakhe etc. etc. (02.04.2013 - BOMHC)
31..…..Under this definition a person who is entitled to the possession of the assets of the deceased becomes legal representative irrespective of whether he is actually in possession or not. If he is not the heir then it is necessary to prove that he is actually in possession. It was held in Lallu Bhagvan v. Tribhuvan Motiram, that a decree could be passed against the legal representative although the deceased debtor may have left no assets. All that the Court has to see is whether the right to sue survives and is enforceable against one who in law represents the assets of the deceased. All that is necessary is that the legal representative must be a person on whom the estate would devolve. Section 52(1), Civil P.C., also shows that a decree may be passed against the legal representative of a deceased person without proof that the deceased left any property. The decree passed against the legal representative only declares his liability to account for the assets of the deceased debtor in his hands. Consequently it is not necessary to inquire in this suit as to whether the respondent has any assets in possession of Mt. Rukmabai or even that Mt. Rukmabai had left any assets. On this point there was disagreement between the Judges of the Allahabad High Court. In Tamiz Bano v. Nand Kishore : MANU/UP/0074/1927 : AIR1927All459, Mukerji, J., was of opinion that the question has to be determined in execution and Ashworth, J., was of opinion that it must be determined in the suit itself. It would appear however that Ashworth, J., was influenced by the rule of English law in this respect. In view of Section 52, Civil P.C., it appears to me clear, as observed by Mr. Mulla, p. 181, Edn. 9 of 1930, that the plea is confined to execution only: see also Shankarlal v. Ganesh Singh and Rajaram v. Nathu.
It is contended for the respondent that the plaintiff is not entitled to the relief asked for in second appeal. I do not see any reason why he should not be entitled to this relief. Order 7, Rule 7, Civil P.C., states:
Every plaint shall state specifically the relief which the plaintiff claims either simply or in the alternative, and it shall not be necessary to ask for general or other relief which may always be given as the Court may think just to the same extent as if it had been asked for.
The plaintiff has pleaded that the respondent being the daughter of Rukmabai is her heir and representative and has also asked for a decree, against her. He in reality asked for more than he was entitled to. There is nothing to prevent the Court from giving him as much relief as he is entitled to. The appellant has now claimed for what was already covered by the relief which he asked for in the plaint. The prayer made by him now is based upon admitted facts and all I have to see is whether he is under law entitled to it. I am of opinion that, to meet the ends of justice, the plaintiff must be given a decree against the assets, if any, of Mt. Rukmabai in the hands of the respondent. I therefore pass a decree accordingly.

Guest (Expert) 16 January 2021
In Simple Words -- The Legal Heirs are liable to the lender only to the extent of value/assets inherited from /of the deceased borrower.

Madhu Mittal (Querist) 16 January 2021
Respected Sir,
Thanks fot attending my query.
I agree what you have written in simple words, but guide on following:

Please guide where deceased borrower died before institution of suit and suit is filed against legal representative, whether the onus of proof whether legal representatives got any property in inheritance or not to be decided in 1. Suit itself or in Execution Proceedings, and 2. If decided in Suit itself again, onus of proof whether legal representatives got any property in inheritance or not is on the lender or on legal representatives 3. If decided in Executing Procedings again, onus of proof whether legal representatives got any property in inheritance or not is on the lender or on legal representatives.

Madhu Mittal (Querist) 15 June 2021
Respected Sir T. Kalaisevanji,
I am grateful and wants to thank you with your guidelines by your quoted citation, AIR 2002 Madras 206, I have mentioned the properties got by legal heirs in Suit itself, thus saved my suit against legal heirs. thanks a lot for guiding this way.

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