I have taken equipment on finance for 1 cr. I have paid approx 50 lacs and the balance due is 50 lacs on monthly emis of 3 lacs. Now i am defaulting on these payments as my client has cancelled the contract.
The financier/bank had filed section 138 charges on me for bounced cheques against these emi dues. In the meantime he has taken over the asset and sold it for a value of 15 lacs (35 lacs still being due)
MY question is are the section 138 criminal charges still applicable as he has sold the assets and the recovered amount is more than the cheque bounce amount
If you have already given post dated or blank cheques to the financier/banker, then yes, they will put the cheque whey they will become due and may get cause to initiate action against you under section 138. It has nothing to do with how many cheques have been dishonoured and how much amount they have already recovered. If some amount out of 50 lacs unpaid is remaining due, then they can get the cause of action after cheques get dishonoured for the amount mentioned in the cheques.