Legal Question in Banking Law in India

Personal Loan Security Cheque Encashed

Hello,

I had taken a PL from a bank for 1,40,000 for which I was unable to pay my EMIs for last 5 months.

The Bank had used a security cheque that I had given them last year (they have 7 cheques more) to take out Rs. 17, 650 from my account which got bounced because of insufficient balance. Today, they sent me a letter from the lawyer that if I do not pay this amount in 15 days, there will be severe legal proceedings.

Is that correct that the Bank can use security cheques to withdraw money?

I am ready to pay the EMIs from now on as I have money now, but I cannot pay the big sum now.

What to do?


Asked on 12/24/08, 6:44 am

5 Answers from Attorneys
Homi Maratha N.N. Maratha & Co.-Advocates

Re: Personal Loan Security Cheque Encashed

Already replied.

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Answered on 12/26/08, 12:13 pm
J. Radhakrishnan independent Practice

Re: Personal Loan Security Cheque Encashed

Cheques given as security cheques are not mere pieces of paper to be kept by the Bank, even when you default in the payment of EMIs. They are meant to be utilized when you commit default. Nothing wrong in the Bank in presenting the cheque(s) for payment when you have admittedly defaulted. Please ensure that you make payment for the dishonoured cheque and meet the Bank officials to work out an amicable compromise, explaining to them your difficulties and showing your earnestness to settle the debt.

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Answered on 12/24/08, 10:06 pm
Prof.Somnath Mukherjee s.mukherjee associates,09874053359

Re: Personal Loan Security Cheque Encashed

You may contact to a lawyer

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Answered on 12/28/08, 2:11 pm
Sudershan Goel India Law Offices of Sudershan Goel - Advocate

Re: Personal Loan Security Cheque Encashed

You may better contact the Bank to sort out this issue; if you make payment of the EMI payment missed earlier, they may not take any further legal action which they are otherwise entitled to take.

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Answered on 12/27/08, 10:50 am
G. M. Gupta gmguptaandassociates

Re: Personal Loan Security Cheque Encashed

no problem

just approach the bank and negotiate with them. i will advice you to please have a good lawyer with you in negotiation so that you benefit more. if you have icici or kotak then we can help you

bye

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Answered on 12/26/08, 7:54 am


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