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Rajan Salvi (Lawyer)     04 September 2008

Hand loan , 138 case

I am for the complainant who out of a long lasting relationship gave hand loan to the accused. Case is decided against me on the grounds that [1] There is no eye witness to the transaction. [2] there is no account maintained by me [3] Cheque amount/ loaned amount Rs 2 Lakhs does not reflect in my income tax nor in the account books.
           My argument is that [1] a person does not lend money to a friend dvertising it. I.E. he is discrete. [2] for hand loan why there should be maintaining account books [3] If i have not paid income tax on that amount , the matter is not the subject of dispute in this case. It has come in the evidence that I am a wealthy person, then in such circumstances the court ought not to have insisted on proof whether i really had that amount or not.
           Accused lead evidence to show that a blank cheque was given to me towards another transaction and i falsely filled in the amount . However this contention of the accused is disbelieved by the Ld. Judge and he decided against me on the three grounds stated above .
I have preferred an appeal agst acquittal in the High Court which is pending admission. Can anybody give any judgment in my favour. Most of the judgments on hand loan are against me.   REGARDS


Learning

 11 Replies

Narayanan. R (Advocate)     04 September 2008

dear rajan


admittedly any monetary transactions should be proved by documentary evidence either for criminal offence or for recover in civil suits.  for cheating offence the hand loan may be taken up for consideration. but the commission of offence should be proved either by a eye witness, or an authoritative proof of accounts maintained towards the legally enforceable debt exclusively or that at the time of extending the loan you might have paid such income tax including the amount lent for loan.  that may be prove that you may have such huge amount with you to lend the loan and you have the capacity.   this may not be a dispute but it proves you ability to lend such amount. any transaction more than rs.100 should be maintained by accounts or other records.   in the absence, it would be against you.

Rajan Salvi (Lawyer)     04 September 2008

Dear Mr Narayanan,


Is there any law that every transaction above Rs 100/- account should be maintained. Does the debt become a legally unenforeable one only because no account are maintained .

mahesh (Advocate)     04 September 2008

as per the provisions of the income tax act any transaction above Rs. 20,000/- should be by cheque only and not otherwise. based on the said provision many judgments are being passed in karanataka.

K.C.Suresh (Advocate)     05 September 2008

Dear Rajan


As such your case is a week one. But you have a cheque in blank. That is the only evidence to you to prove that there was a transaction between you and the accused. The contention that the blank cheque issued by the accused was for another transaction eans there was transactions between you and the accused. Now the burden shifts to accused prove that the cheque really issued was for another transactions. It is the duty of u to lead evidence that the cheque is issued by the accused and there was legally effected debt. Is there any chance for using the presumtion u/s 139 NI Act.

MANISH (Advocate)     06 September 2008

Dear Friend / colleague,


Just argue the case further in higher authority, i.e. in sessions and take the please of section 139 of the negotiable instruments act.  Just state that a blank cheque signed by the drawer in itself states that the drawer of the cheque owes some money towards the payee, and there is a good consideration for that, which is the foremost essential of the proceedings under section 138, NI Act.


Then it is burden on the opposite party / accused, that there is no such consideration.


 


BYE FOR NOW.


 


 

jayaveladvocate (Lawyer)     12 September 2008

pravin jain (proprietor)     06 September 2009

Originally posted by :Rajan Salvi
" I am for the complainant who out of a long lasting relationship gave hand loan to the accused. Case is decided against me on the grounds that [1] There is no eye witness to the transaction. [2] there is no account maintained by me [3] Cheque amount/ loaned amount Rs 2 Lakhs does not reflect in my income tax nor in the account books.            My argument is that [1] a person does not lend money to a friend dvertising it. I.E. he is discrete. [2] for hand loan why there should be maintaining account books [3] If i have not paid income tax on that amount , the matter is not the subject of dispute in this case. It has come in the evidence that I am a wealthy person, then in such circumstances the court ought not to have insisted on proof whether i really had that amount or not.           Accused lead evidence to show that a blank cheque was given to me towards another transaction and i falsely filled in the amount . However this contention of the accused is disbelieved by the Ld. Judge and he decided against me on the three grounds stated above . I have preferred an appeal agst acquittal in the High Court which is pending admission. Can anybody give any judgment in my favour. Most of the judgments on hand loan are against me.   REGARDS

 
"


 

B.N.Rajamohamed (advocate / commissioner of oaths)     06 September 2009

 

There are precedents that when there is no proof of hand loan the case fails. But the only way you can challenge is by stressing section 139 of the Act. There is noo dipute with regard ot the signature of the drawer it seems. He has not challenged the hand writing on the face of the record . You proceed in this aspect. This is the only option left to you.


 

pravin jain (proprietor)     09 September 2009

 

A private limited company  has paid professional fee to chartered accountant for setting  up a project of Bio -Diesel and cultivation of Jetropha plantation .  cheque in the name of Chartered accountants firm's issued for project report preparation fee. Another cheque issued to cultivate the nursery for plantation in favor of his HUF the karta of HUF is proprietor  of Chartered Accountant's firm.( karta and Chartered Accountants are same) 
After  preparation of project report and raising of nursery for saplings  due to some disputes ,  the  karta of HUF  has issued the cheque for entire amount to the company. The cheques returned and Director of the company  has filled the suite under sec. 138 of N.I. Act.
Now question arises that whether the karta of HUF shall be liable for  fees received by  Chartered Accountants firm ?  
Whether fees received by HUF returned to the company is  a Debt or Legally enforceable debt ?
Whether cheque issued to return the fees is for consideration?
The  karta of HUF has made an application under sec. 91 of Cr. p.c.  for production of agreement , MOU, books of accounts, vouchers, other relavant records in support of transaction. The Company  denies  to produce any thing. And  through its director furnished an affidavit that the company has no records, vouchers nor account books in his possession on nor in control and can not produce. The case is at evidence stage steel evidence has not started.
On the basis of above facts  can a discharge petition be filed by HUF? 
Or Director of company can refuse to produce the documents which the company is legaly liable to maintain under section 209 of Companies Act 1956.
PLEASE COMMENT ON THE PROBLEM,
 

Amit Patwa (Manager)     30 September 2010

Mr. Rajan Salvi, 

Could you please advice me the case number and judgment ref no. or date.

I am requesting this because some one has falsely accused me and above could me of my help.

Shall be grateful for your reply. 

Thanks.

Amit

Curious Sam (Self)     12 June 2012

I am in the other boat, but my question pertains to the situation of hand loan.  In my case, the complainant has claimed when filing a 138 case against me that he had given me a hand loan (friendly loan) exceeding  10 lakhs about seven years back and taken post dated cheques from me (post dated 3 years from date of loan). The cheques then were made to bounce. The truth is that no evidence has been presented of the friendly  loan given, no entry in the cheque is in my handwriting (IN FACT ALL THE CHEQUES HAVE  DIFFERENT HANDWRITINGS).

It looks like the signature on the cheques are also forged. The cheques are more than 10 years old.

Regarding the question that how the complainant got hold of the cheques in the first place, he happens to be my brother.

Can the learned lawyers please cite judgments which were not in favor of complainants because the loans were not through cheque or not documented in Income Tax returns or in books or where the cheques had been forged.


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