(Guest)

Time barred debt

Good Evening Honourable Panel Members, I am writing in regard to my personal loan of Rs. 225,000 taken from a reputed bank. My wife was the primary applicant and myself secondary applicant. I do not remember the year the loan was taken (2006 or 2007). I made prompt payments Rs. 6700/month till July 2008. After July 2008, I moved to UK and handed over these finances to a friend to care off. I used to send the EMIs regularly to my friend until I discovered that he is not making the payments after a year. I stopped sending him money from then. Unintentionally I defaulted this loan and ignored it completely thinking I will not return back to India. In January 2012, I returned back to India due to family issues. On February 13, 2015, (three year after my return) a day after my younger sister’s wedding two executives visited my house stating they are from the Bank. By this time I completely forgot that I had defaulted the loan. They brought in my loan repayment history which showed I paid about 50% of the term and 50% was pending. These visits were very professional, but slowly the pressure was mounting to clear the debt. I was not in a position to clear because of my Sister’s wedding, new flat and car. After the wedding I was carrying a debt of Rs. 300,000 and this shock was not expected. They demanded to restart paying. I spoke to one of my friend and he advised not to make any payments until the executives provide the agreed foreclosure/waiver letter. He also advised me not to visit the branch. Pressure was at its peak and in a weeks’ time they would visit my house everyday and sit for hours and hours discussing. Now they started to intimidate and forcing me to visit the branch or start repaying slowly. As I was unwilling to visit the branch the team advised me to write a letter for discount/negotiation to a manager in the Bank and also made me write the date when I will be making the payment of Rs. 10000 as first payment. In the letter I clearly mention that I will not be able pay more than Rs. 75000 and that too if it is in writing from the Bank. I also mentioned I will not make payment of Rs. 10000 if I do not get the foreclosure letter before the agreed date. I did not provide any fresh cheques. Me and the executive both mutually signed the letter. This letter I thought was a unilateral agreement from my side requesting waiver in the loan amount. The team failed to provide the Foreclosure letter on the said date and eventually I did not pay the said amount. Unable to bear pressure and humiliation I decided to shift my house and moved to the new flat immediately. This happened in April 2015. Now after the gap of 16 months they are back to my new place and demanding money. I am not in a position to pay. The only asset at the moment is a 2-year-old car which I do not want to sell. They are advising me to sell and payback and not ready to negotiate. Me and my spouse both work and major portion of the income goes to a personal loan and home loan. Making both ends meet is really tough at this time. Please advise what are the repercussion for this loan which was taken in the year 2007 and the letter which I gave it to them in 2015. Will this affect our jobs or do we have to face criminal or civil litigations???? Thank you for going through this long request.

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8 Replies

Kumar Doab (FIN) 17 September 2016

You have borrowed, you should pay.

Borrower should always remember th debt and pay debt first.

It is not at all clear if th letter given by you would amount to admission of debt.

An able counsel that has examined all record can advise you the best.

G.L.N. Prasad (Retired employee.) 18 September 2016

You have acknowledged the debt and written a letter to Bank, there by extending the limitation period. You can not escape the liability and now that you are in India, and now the debt is in force, Bank will certainly proceed legally against you, as by this time they might have concluded that you are a wilful defaulter. No way you can escape. The money you have borrowed is certainly given by the Bank, and the money belongs to public and they are just custodians and accountable. Now those intentional defaulters are comparing themselves with mallayas, rai and what the banks are doing against them. Banks may not be able to proceed against them for several constraints, but surely they can proceed against those defaulters who are under their control.

(Guest)

Thank you Panel Members for the responses. The letter which I provided clearly mentions if I get foreclosure letter or any writing from bank about agreed amount then only I will start paying, like unilateral agreement. They are reluctant to provide anything in writing. They are saying I won't get any no due certificate or foreclosure letter, but just an receipt for the amount paid. I am aware of the fact that if I start paying, the loan will be active again and they also want the same thing to be done. They are collection executives working for recovery department. I am not sure if anyone of them have IDs provided from the bank. I am thinking to go to banking ombudsman to check if this can be treated as time barred loan. Please advice. Thanks a lot in advance.

AV Bagur Advocate (Advocate ) 18 September 2016

I agree with the views of Sh GNL Prasad.

Your recourse would be to proceed against your "Friend" in civil and criminal proceedings, subject off course to other issues, especially limitation. You should consult a advocate for further course of action in the matter.

(Guest)

Thank you all, but will it be okay to go ahead with settlement without any documentation except the receipt which does not state nodue or foreclosure. Why are they so reluctant to provide any documentation, but want the payment. Is this correct from their part. Can't I get any realistic help??? Thank you.

G.L.N. Prasad (Retired employee.) 18 September 2016

Go any where, any forum, your attitude in changing address, in telling stories, in demanding Bank to accept your terms and conditons for repayment of money legitimatelly lent to you will not be tolerated appreciated. The forum is bound to brand you as wilful defaulter. One should not play smart with Banks, as every defaulter uses such cards and a banker is well aware of the intentions.

Banking Ombudsman is for deficiency of services and do not expect that they take up cases of non performing advances also.

This not end of all, and you have to approach any bank for further prosperity. Think positively, you can not get any remedy any where. Honestly pay the bank debt, the compromises are not possible at the demand of borrower. It is possible where there is no security and there are genuine reasons for default and during observance of such month, and such decisions have to be taken at higher levels. Beware if they sell away the NPA to other companies, they do not show this mercy to borrower.

(Guest)

Thank you Sir for the branding. I always knew and believed speaking truth and being open always helped. I did not know this will lead to stories and branding. I feel that is a strong word and don't know whether it is in line with the forum rules. Well Sir, I may not be as clever as you all are, but showed courageous integrity and that's the reason I came into this forum. This branding could influence others judgement. I am sure there would be someone who can show empathy for me. I started working when I was 16, I wished somebody was there to look and brand this as child labour. I took this loan when I was 25, no one can imagine why someone would need this huge sum and I don't intend to explain cos this will be another story which will eventually lead to branding again. I am simple, down to earth, and self made man and default loan of Rs. 225000 does not determine my character. Thank you all for responding and branding. I am willing to payback, but have lot of limitations. May I know why these reputed banks do not respond in writing andwhy they refuse to give foreclosure or no due certificate and is it okay to pay without these letters??????