Legal Question in Banking Law in India

sec 138

i had issued pdc to an mnc co. during the course of business but i instructed my bank for ''stop pymt'',after clearing a few chqs.,against a couple of chqs.as that co. is not forthcoming in clearing my pending a/c with them.the co. is not willing to settle my claim till i pass their chqs.and stopped business with me.i have invested a good amt. of money in the business.they have filed a case of 138 against me. cant i adjust my genuine pending claims against the chq.amt. will i have to pay the amt. and forego my money.wot abt. my money that i invested in the business which is stuck in the market due to their sales personnel?now that the business is shut down,no debtors is willing to pay me back.the mnc co. is carrying the business on its own and supplying to the same retailers.


Asked on 3/03/09, 3:08 pm

4 Answers from Attorneys
Sudershan Goel India Law Offices of Sudershan Goel - Advocate

Re: sec 138

Once the case u/s 138 has been filed against you, the only option left for you is defend yourself in the case. You may of course take all available defences, including non-existence of your liability towards the company represented by the cheques in question.

You may also consider filing a civil suit against the company for settlement of accounts; if you establish your claim against the company successfully, the amount receivable by you may possibly create a good defence in your favour in the 138 case.

However, as of now, it may be better if you prepare yourself to pay the cheque amount to avoid criminal liability; or try to reach an amicable out of court settlement with the payee.

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Answered on 3/03/09, 5:21 pm
Pranav Desai PD Legal & Associates

Re: sec 138

I believe in this situation you can file a suit for recovery of your pending amount. Further, you can also try to produce documents in the court informing that the cheque payment was stopped because there was no obligation on your part to pay.

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Answered on 3/08/09, 11:45 am
Aniruddha Pawse Aniruddha.P.Pawse Advocates

Re: sec 138

you will have to defend case u/s 138 and simulteanously can file for recovery.

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Answered on 3/11/09, 1:38 am
J. Radhakrishnan independent Practice

Re: sec 138

So far as prosecution under Sec.138 you have to defend the same by showing that the cheques which bounced do not represent as given in discharge of any subsisting liability to the MNC. You must also file a civil suit against the company for establishing your claim. Long litigation is on the anvil. Try to work out some settlement and purchase peace.

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Answered on 3/04/09, 9:19 am


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