hand loan cheque bounce

[Lakshmi Gudipati]

Hi
I gave a cheque for security purpose in a settlement case to my friend. as it is given for security purpose, I issued stop payment and cheque bounced because of the same. Now he filed false case stating that I took hand loan from him in cash and the cheque is for hand loan. There is no promisory note or any other legal tender or bank trasaction to prove that I took loan from him. Please advice

[Dr. Ashok Dhamija]

Please read the following reply for cheque bounce case for hand loan: Cheque bounce under S. 138 for friendly cash loan or hand loan.

Also see: Dishonour of cheque given as security – whether offence under Section 138 N.I. Act made out?

     

---

Dr. Ashok Dhamija is a New Delhi based Supreme Court Advocate and author of law books. Read more about him by clicking here. List of his Forum Replies. List of his other articles. List of his Quora Answers. List of his YouTube Videos.

[Lakshmi Gudipati]

Sir My lawyer told me that the cheque is mentioned by the complaintant in his income tax return. hence legally enforceable debt and regarding cash loan of 12 lakhs and one should not lend more than 20,000 in cash, my lawyer is telling that it is court won’t bother about the same as that voilation is for income tax dept to take care of. kindly direct us
regards

[Dr. Ashok Dhamija]

You may have to take all possible defences. For example, you said that the cheque was given for security purpose. Then you said that there was no cash loan and it is a false allegation. No promisory note, or any agreement, etc. So, you should adduce evidence for all these things. Merely because the other party has shown the loan in Income Tax return may not be sufficient. You can also use the legal ground of cash loan of an amount above Rs. 20000 not being legally permissible and thus not being legally enforceable, more so the same being in the absence of any proof of the cash loan having been given. Since the burden will be on you (after having given cheque), you will have to do whatever best is possible in the situation, and then leave it to the court.     

---

Dr. Ashok Dhamija is a New Delhi based Supreme Court Advocate and author of law books. Read more about him by clicking here. List of his Forum Replies. List of his other articles. List of his Quora Answers. List of his YouTube Videos.

[Author]

Posts