Legal Question in Banking Law in India

Hi, I got a cheque for 1300K from my creditor. I deposited this to my account and my bank given me the credit to my account. next day I have issued a cheque to my debtor for 700K and he also got the credit. on 3rd day, my bank came back to me saying that the cheque I got from my credtor got bounced and asking me to refund the 700K to bank which I gave to my debtor. else bank is going to sue me. can bank do this? how can a bank give me credit for such a big amount with out getting confirmation and now after`3 days asking to refund back the amount. my bank say that if I dont refund this 700K they are going to seize my locker which is in thius bank. is this justified?


Asked on 3/24/11, 1:28 pm

1 Answer from Attorneys
J. Radhakrishnan independent Practice

your bank having given instant credit has discounted the the cheque . That does not mean the BANK cannot reversse the credit when the cheque deposited by you bounced later. The Bank may not seize your locker. It is only a threat to you to pay the debit balance caused on account of the bouncing of the cheque. Better credit sufficient funds to the Bank account to come out of the situation

Read more
Answered on 3/25/11, 9:54 pm


Related Questions & Answers

More Banking Law questions and answers in India