Saswatabanerjee
Partner - Risk Management
Sushilkluthra@gmail.com
Consultant In Legal Matters
+2 Others

Thread Started by #RAJ8432

Dear All, I have a recruitment placement company, I served one of our clients and he gave us a cheque of Rs. 1 lac, that cheque got bounced 2 times, I filed a case under section 138, however nothing is being done yet, its being over a month now, dont know what to do next, please help me out ......
3rd June 2015 From India, Delhi
you can raise your query with The Ombudsman of RBI, whose email id available on the net.
3rd June 2015 From India, New Delhi
If the terms and conditions were written and in pursuance to which they give you cheque which got bounced, you can file summary procedure suit under Order 37 rule 2 CPC in which decree may be passed without leave to defend to defendant.
Thanks
Sushil
3rd June 2015 From India, New Delhi
You should be asking this to your lawyer.
Or getting a better lawyer.
However, with the condition of the courts as they are, you are unlikely to get immediate relief. In any case, I am sure the customer is going to raise objections saying there is no doubt due and that there is a dispute, etc. the case will go on for a long time.
A settlement with the client is more optimum

3rd June 2015 From India, Mumbai
Generally a criminal lawyer does not know civil remedies and vice versa and similarly one professional çannot suggest solution regarding all other profession strategies. The queriest was not finding solution to his problem that is why he knocked the citehr. Here even persons having obtained legal advice yet approach citehr to doubly check whether they have properly advised. If I do not know solution to a problem, I will better not answer the query.
Everyone knows it takes years to get relief out of section 138 relief but his curiosity was to find alternative quick remedy.
Thanks
Sushil
3rd June 2015 From India, New Delhi
Giving false hope to any poster is a bad thing.
Which you seem to like doing :)
If you have a solution, please call the person and offer to do it for him.
It just happens that I deal with law and lawyers extensively and I know that it takes a very long time and a lot of money and efforts to get any real benefit or relief from sec 138 cases. From the original post, it's clear that the poster does not know that. Telling him it will get done quickly, which is not going to happen, is unfair.
Let's talk on this after you have helped him in getting his money back quickly. I will be more than happy to admit I was wrong.

4th June 2015 From India, Mumbai
Without knowing the content of order 37 CPC and the condition which I set out in the post, it is wrong to allege about false hope. Pl discuss with your lawyer in how many cases relief has been given to plaintiff without allowing defendant to fdefend. If you want I can give you citations. Pl correct your statement.
Thanks
Sushil
4th June 2015 From India, New Delhi
XXX owner has shown his company as bank rupted, now whenever I ask lawyer anything about it, he give me lot of different advices and force me to pay more and more in order to keep this case going.
I heard lot of things about cheque bounce that, criminal will get non baylable warrent, however it is so difficult to get it done.......
4th June 2015 From India, Delhi
The Supreme Court arrived at the conclusion that for maintaining the prosecution under Section 141 of the NI Act, arraigning of a company as an accused is imperative. What will be the fate of prosecutions under section 138 NI Act if a company is liquidated, has to be ascertained in view of the latest law of the land holding that the decision in Anil Hada is overruled with the qualifier as stated in para 51.Thus it was held that the decision in Anil Hada has to be treated as not laying down the correct law as far as it states that the Director or any other officer can be prosecuted without impleadment of the company.

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.1364 OF 2014

(arising out of SLP(Crl.) No.7039 of 2007)

Anil Gupta … APPELLANT

VERSUS

Star India Pvt. Ltd. & Anr. … RESPONDENTS

14. Again the same question was considered by three Judge Bench

of this Court in Aneeta Hada v. Godfather Travels and Tours Pvt.

Ltd. (2012) 5 SCC 661. The Court noticed the decisions in Anil

Hada (supra) case and Aneeta Hada (supra) case. The three Judge

Bench while partly overruled the finding of Anil Hada (supra)

affirmed the decision of Aneeta Hada (supra). This Court held

“51. We have already opined that the decision in

Sheoratan Agarwal runs counter to the ratio laid

down in C.V. Parekh which is by a larger Bench and

hence, is a binding precedent. On the aforesaid

ratiocination, the decision in Anil Hada has to be

treated as not laying down the correct law as far

as it states that the Director or any other officer

can be prosecuted without impleadment of the

company. Needless to emphasise, the matter would

stand on a different footing where there is some

legal impediment and the doctrine of lex non cogit

ad impossibilia gets attracted.”

“53. It is to be borne in mind that Section 141 of

the Act is concerned with the offences by the

company. It makes the other persons vicariously

liable for commission of an offence on the part of

the company. As has been stated by us earlier, the

vicarious liability gets attracted when the

condition precedent laid down in Section 141 of the

Act stands satisfied. There can be no dispute that

as the liability is penal in nature, a strict

construction of the provision would be necessitous

and, in a way, the warrant.”

“58. Applying the doctrine of strict construction,

we are of the considered opinion that commission of

offence by the company is an express condition

precedent to attract the vicarious liability of

others. Thus, the words “as well as the company”

appearing in the section make it absolutely

unmistakably clear that when the company can be

prosecuted, then only the persons mentioned in the

other categories could be vicariously liable for

the offence subject to the averments in the

petition and proof thereof. One cannot be oblivious

of the fact that the company is a juristic person

and it has its own respectability. If a finding is

recorded against it, it would create a concavity in

its reputation. There can be situations when the

corporate reputation is affected when a Director is

indicted.

59. In view of our aforesaid analysis, we arrive at

the irresistible conclusion that for maintaining

the prosecution under Section 141 of the Act,

arraigning of a company as an accused is

imperative. The other categories of offenders can

only be brought in the drag-net on the touchstone

of vicarious liability as the same has been

stipulated in the provision itself. We say so on

the basis of the ratio laid down in C.V. Parekh17

which is a three-Judge Bench decision. Thus, the

view expressed in Sheoratan Agarwal does not

correctly lay down the law and, accordingly, is

hereby overruled. The decision in Anil Hada is

overruled with the qualifier as stated in para 51.

The decision in Modi Distillery has to be treated

to be restricted to its own facts as has been

explained by us hereinabove.”

15. In the present case, the High Court by impugned judgment

dated 13th August, 2007 held that the complaint against respondent

no.2-Company was not maintainable and quashed the summon issued by the Trial Court against respondent no.2-Company. Thereby, the

Company being not a party to the proceedings under Section 138

read with Section 141 of the Act and in view of the fact that part of the judgment referred to by the High Court in Anil Hada (supra)has been overruled by three Judge Bench of this Court in Aneeta Hada (supra), we have no other option but to set aside the rest part of the impugned judgment whereby the High Court held that the proceedings against the appellant can be continued even in absence of the Company. We, accordingly, set aside that part of the impugned judgment dated 13th August, 2007 passed by the High Court so far it relates to appellant and quash the summon and proceeding pursuant to complaint case No.698 of 2001 qua the appellant.

16. The appeal is allowed with aforesaid observation."

It follows that you must seek intervention in liquidation proceedings for recovery of amount due. Better it would be to file summary procedure suit under Order 37 RULE 2 CPC through a civil lawyer and obtain decree and even implead the liquidator as defendant if you come to know about details.

Thanks

Sushil
4th June 2015 From India, New Delhi
That is, unfortunately the reality.

Lawyers are out to get as much money as possible from you.

The courts are clogged with pendency that stretches the simplest of the cases.

And the police don't care for criminal cases in sec 138 as they have much better (more important) things to do. Sec 138 has reached end of its usable life. But that's another story.

Pursuing a sec 138 case today has little benefits today. It's only scare tactic where the other party does not want to get on the wrong side of a law that can land him in jail. Where the person does not care, or is sure his lawyer will keep him out, and where he is bankrupt, there is little benefit. In this case, you are mostly unlikely to get your money.

The matter then you need to evaluate is the cost benefit analysis. How large is your business, can it sustain a legal battle with little possibility of recovery, does it have deterrent impact on other clients that you are not to be messed with, etc. not something that a member of this forum can help you online. You need to take a call your self or have your business consultant / CA help you with that.


5th June 2015 From India, Mumbai
Since there is an element of criminality in cheque bounce case,people may think twice to allow their cheques to bounce.
Whether proceedings take time or not,there is no other option but to approach courts.
So in future clients should be asked to pay as per work progress and not at end of job.
Trusted dealings are becoming difficult at times with such attitudes of people who enjoy from delays in courts.
So this is another risk factor.
5th June 2015 From India, Pune
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