Query regarding misuse of cheques


Hi

 

I had mortgaged a property. Later the mortgage was cancelled by returning the money.  But initially there was some shortage of money, for which we agreed that I give couple of cheques and the party will present monthly one cheque and get the money in EMI. Accordingly few cheques were given to him alongwith the balance amount. But latter just before the cancellation of the mortgage, he insisted that he need the entiire money before the mortgage caancellation and then only he will cancel the mortgage. Having paid maximum money to him, I dint want to cancel the mortgage and acccordingly I managed to arrange the balance money and paid him the entire moeny before the cancellation of mortgage and the  mortgare was caancleed in all respects. But he dint return me my cheques. He said he had kept it in hotel room and he will return it once we go back after the canccellation of the mortgage in sub regisstrar office. But later he dint give me the cheques.

I sent him a letter narrating the details and asked him to return my cheques. For whcih he replied saying that he doesnt have my cheques. However he wrote me saying that after the cancellation of the mortgaage, I agaain asked him to give me 30 Lakhs for a period of 1 month and for whcih I have given him 3 cheques of rs. 10 laakhss each and he is going to present them. Accordingly he presented 3 cheques out of my 8 cheques that was taken by him before the mortgage caancellation. All these 3 cheques got bounced. After few days some other people started presenting my other cheques that was with him and all got bounced.

 

Kindly advise how to handle this situaatioh, as it is purely misuse of my cheques that was taaken by him initally . I have never taken money from him after te caancellation of the mortgaage. If I had to take money, then I would not have cancelled the mortgage at all on that day.

 

Kindly aadvise the way forward for me.

 

many Thanks in advaance.

 
Reply   
 
student

Hi Pradeep,

First you should have cancelled the cheques from bank the moment he refused to retutn it back to you i.e after you payed the complete balance.

Secondly, you have not mentioned that was there any written doccument pertaining to the mortgage and also when you repayed the mrtgaged amounts did you take any recipts with proper dates and signature on it?

 
Reply   
 



Your liability exists till the mortgage of property is in operation. If you can prove that you have given the cheques in lieu of that mortgage and the mortgage is now cancelled, it will automatically exit you from any liability. 

For your benefit, must do the follows. 

1. File a criminal complaint against the cheque holder describing all the facts (for not returning the cheques, which are lying with him as security and making misuse of the cheques).

2. Along with copy of FIR, go to the bank and tell them to stop the payment of cheques, as somebody is trying to blackmail you.

At last, use the word "security cheques" instead of only word "cheque" every where you have to discuss this matter.

The term of "Security cheques" keep you out from the sec-138 of Negotiable Instrument Act (criminal liability) and you will remain liable for civil suit (recovery for money) only.

 
Reply   
 

Thanks for your  promppt responses.

Initially the the morgtgage was done as a registered mortgage in sub registrar office and the cancellaton also was done in the same sub regestraar office with a  registered receipt document. Since he had not returned me the security cheques, I had wriiten a letter to my bankers requesting them to STOP Payment for all the cheques and the same is done from my Bank's side.

In the mortgage cancellation recipt document it is clearly mentioned that the  mortgage amount, interest and costs if any are fully settled and the mortage is cancelled.

Also when the mortgage is caancelled fully, where is the question of me again taking the money from the same person ?. Also if I was in need of the money then I would not have cancelled the mortgage on that day instead would have cancelled after a month.

 

 
Reply   
 

Don't worry. File a criminal complaint against him describing all the facts and demand your "security cheques" back from him.

One query from my side:

You have told that he is trying to prove that you owes money to him even afte the cancellation of mortgage. Have he any other proof with him to prove such liability from your side inspite of mortgage money. Because, if there is only mortgage transaction place between him and you, for which you have give him that security cheques, then there is no issue due to cancellation of mortgage deed. Your liabilty is over with the cancellation of mortgage deed. But, if he have some additional proof to prove any other liability (as business liability or any other liability) or other document such as promissory note to prove any such liability, then it may create problem for you.   

 

 

 
Reply   
 

Thanks again for your quick response. There is nothing other than my cheques with him. Please find below the activities took place. 1) I mortgagued my property to him 2) After 3 months, I got some money so wanted to cancle the mortgage and approaached him. But I had a shortfall of 15 lakhs , for whcih we discussed and agreed that I give him 12 cheques for 12 EMIs to clear the balance. 3) Accordingly a loan agreement was prepared by him and he took my signature in that and also took 12 signed blank cheques from me along with the Balance cash amount. 4) We both were about to sign the cancellation document in sub registrar office, he went out and spoke to someone through mobile and after the call he came back and insisted that he need this pending 15 lakhs also in cash before the canclation or else he wont do the cancellation. 5) We had some heated arguements due to the above. Couple of my friends were there with me and they managed to arraange for this 15 lakhs and we gave that money as well and asked him to return the cheques and the agreement paper. 6) By then he had sent them with someone from there and told me that he would give them to me after the completion of the process in sub registrar office. But after the completion of the work in sub registrar offie, he was not available for me. 7) I waited for few days thinking that he would return, but he dint. 8) I wrote him a letter explaining the whole episode and asked him to return my cheques alongwith the loan agreement paaper. I also gaave a letter to my Banker to stop payment of all these 2 cheques. 9) He replied saying that, there was no laon agreement paper signed and cheques collected from me, Instead after the cancellation of mortgage, I approached him for 30 Lakhs for a period of one month and he gave me that money and against to this I gave him 3 cheques for rs. 10 lakhs each. And he is preesnting these cheques. after few days he prsented these cheques. He also presented 3 cheques from the 12 cheques lot and they are bounced. 4) After few days of the above another 3 cheques of mine were presented by some other 3 people and all these cheques also bounced. The above is the status as on date. Kindly guide me the way forward and also advise me the consequences of this incident. many thanks for your understanding and guidance.
 
Reply   
 

Thanks again for your quick response.

There is nothing other than my cheques with him. Please find below the activities took place.
1) I mortgagued my property to him
2) After 3 months, I got some money so wanted to cancle the mortgage and approaached him. But I had a shortfall of 15 lakhs , for whcih we discussed and agreed that I give him 12 cheques for 12 EMIs to clear the balance.
3) Accordingly a loan agreement was prepared by him and he took my signature in that and also took 12 signed blank cheques from me along with the Balance cash amount.
4) We both were about to sign the cancellation document in sub registrar office, he went out and spoke to someone through mobile and after the call he came back and insisted that he need this pending 15 lakhs also in cash before the canclation or else he wont do the cancellation.
5) We had some heated arguements due to the above. Couple of my friends were there with me and they managed to arraange for this 15 lakhs and we gave that money as well and asked him to return the cheques and the agreement paper.
6) By then he had sent them with someone from there and told me that he would give them to me after the completion of the process in sub registrar office. But after the completion of the work in sub registrar offie, he was not available for me.
7) I waited for few days thinking that he would return, but he dint.
8) I wrote him a letter explaining the whole episode and asked him to return my cheques alongwith the loan agreement paaper. I also gave a letter to my Banker to stop payment of all these 12 cheques.
9) He replied saying that, there was no laon agreement paper signed and cheques collected from me, Instead after the cancellation of mortgage, I approached him for 30 Lakhs for a period of one month and he gave me that money and against to this I gave him 3 cheques for rs. 10 lakhs each. And he is presnting these cheques. after few days he prsented these cheques. He also presented 3 cheques from the 12 cheques lot and they are bounced.
10) After few days of the above another 3 cheques of mine were presented by some other 3 people and all these cheques also bounced. The above is the status as on date.

Kindly guide me the way forward and also advise me the consequences of this incident.

Many thanks for your understanding and guidance. Please help me out by providing your valuable guidance.

 

 
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