Legal Question in Banking Law in India

Cheque stop payment

A party deposits cheque after verbal agreement via broker for purchase of property. Then the cheque gets stopped. What is outcome of this?

Asked on 12/13/08, 11:48 pm

5 Answers from Attorneys

Sudershan Goel Sudershan Goel - Advocate, International Visiting Scholar, USA [2008-10]

Re: Cheque stop payment

The transaction may be cancelled. However, you may not be able to recover the cheque amount. If you have received any amount in cash, you may be entitled to forefeit depending upon the agreement.

This is very common in property transactions when the market is facing a slow down.

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Answered on 12/14/08, 8:00 pm
Homi Maratha N.N. Maratha & Co.-Advocates

Re: Cheque stop payment

Transaction stands cancelled.

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Answered on 12/15/08, 3:41 am
Nasir Butt Nasir Law Associates

Re: Cheque stop payment

You may annul the agreement forfeiting the amount which you have received in cash.

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Answered on 12/15/08, 8:49 am
J. Radhakrishnan independent Practice

Re: Cheque stop payment

The person in whose favour the cheque is issued is likely to proceed under Sec.138 N.I.Act and in case it goes to the level of prosecution , you will have to defend the same by proving that the cheque was not given in discharge of debt. Your questions should be more specific.

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Answered on 12/14/08, 7:36 am
Aniruddha Pawse Aniruddha.P.Pawse Advocates

Re: Cheque stop payment

already replied.

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Answered on 12/14/08, 8:37 am


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