Legal Question in Criminal Law in India

u/s 138 NI Act agst guarantor pending two cases agst borrower u/s 138

A loan of rs. 100000/- repayable by 12 instalments post dated cheque of rs.9750/- each with a cheque of guarantor Rs. 50000/- in case instalments were not paid within time with a guarantee agreement of rs. 100000/- was disbursed. six out of twelve cheque were paid , but remaning 6 were not paid so two cases u/s 138 NI Act one for rs. 9750/- and another for rs. 48250/- was started against the borrower. Afterwards a regt notice dt 26.12.2005 invoking guarantee to pay rs. 64903/-(including interest upto 10.12.2005) was issued to guarantor telling him either you should pay the amount within 15 days or your cheque will be encashed as per your promise and u should pay remaining rs. 14903/- in cash or by cheque to avoid any legal action.But not answered. on presenting guarantor cheque, it was also dishonoured so a case for this cheque was also lodged against guarantor u/s 138 NI Act. Whether a case of Rs. 50000/- against guarantor u/s 138 NI Act can be dismissed only on the ground that there was already two cases u/s 138 pending against borrower for rs. 57000/- so there is no legal enforceable debt on the date of presentation of cheque of guarantor.


Asked on 3/15/08, 3:16 pm

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

Re: u/s 138 NI Act agst guarantor pending two cases agst borrower u/s 138

Please contact alongwith the agreement. As your case needs an extensive research with some more details.

Read more
Answered on 3/19/08, 6:32 am
Parmanand Sharma Sharma

Re: u/s 138 NI Act agst guarantor pending two cases agst borrower u/s 138

In your problem it is clear that you were guarantor. It is your mistake that you have not gave any reply to notice. It is not clear that while the guarantor have received any notice after dishonour of cheque. Legally in this case the guarantor can not be prosecuted u/s 138 N.I.Act.

Read more
Answered on 3/15/08, 9:10 pm

Re: u/s 138 NI Act agst guarantor pending two cases agst borrower u/s 138

Yes,case u/s.138 NI Act is not maintainable in view of latest law that cheque given as security does not attract prosecution u/s.138 NI ACT,however,civil liability of guarantor can not be ruled out.

Read more
Answered on 3/15/08, 9:10 pm
Shrichand Nahar S.V.Nahar, Advocate

Re: u/s 138 NI Act agst guarantor pending two cases agst borrower u/s 138

As on the presentation of cheque and its dishonour, there was a enforceable debt, subject to law of limitation.

Filing of matter U/s.138 NI against principal borrower does not absolve the guarantor, since the liability is joint and several.

Read more
Answered on 3/16/08, 1:36 am
Aniruddha Pawse Aniruddha.P.Pawse Advocates

Re: u/s 138 NI Act agst guarantor pending two cases agst borrower u/s 138

if there was no legal enforceable liability the case can be dismissed otherwise no.

Read more
Answered on 3/17/08, 10:53 am
Vivek Mapara Vivek N. Mapara

Re: u/s 138 NI Act agst guarantor pending two cases agst borrower u/s 138

It would be better to analyse your case.

The cheque issued by guarantor was issued wiht a view to discharge the liability of the principle debtor,in case principle debtor fails to discharge his liability. So when debtor was not able to pay the amount, the liability of guarantor arouse. Hence the cheque issued by guarantor cannot be said to be without any legal enforciable debts, or a mere security. Hence when the cheque was dishonored, it attracted the penal provision of section 138, and hence complaint under 138 is maintainable, even if previsious complaint against principle debtors are pending

The above advise is given on law point, however, the agreement between you and bank are relevant to consider to give u exact line of action.

Feel free to contact

Read more
Answered on 3/16/08, 9:34 am


Related Questions & Answers

More Criminal Law questions and answers in India