Finance Company Victim (Investor) 21 August 2022

Finance company not paying interest for 3 years

About 5 years ago, I invested some amount with a finance company. They gave a promissory note as receipt once they received my funds.

They paid interest for about 2 years but they stopped paying interest for the last 3 years. Inspite of several reminders, they haven't paid any interest nor returned my principal back. They claim they have properties and are asking me to pay a huge lump sum (since they have pledged the properties with another money lender) if I wanted the property.

I am not interested in acquiring the property as I want my amount back.

What options do I have? Is breaking the promissory criminal?

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LCI Thought Leader Adv. Ravish Bhatt, ADIT, CIOT (Dual Qualified lawyer/ Solicitor International Tax Affiliate CIOT) 21 August 2022

Its not a crim per se. However, somehow if you could show that they had intention not to repay from the beginning, that may be a crime. Additionally, if they are not paying to huge number of people, depending on facts, not paying per se also may be an offence under State Protection of Interest of Depositors Act.

Apart from remedies under criminal law, you have remedy of filing a civil suit/commercial suit for recovery and may be of going to NCLT if amount by any chance exceeds INR 1 crore. May be issuing a notice as regards possible civil as well as criminal action(mainly under State Protection of Interest of Depositors Act) could solve your issue without further action.