Sales Executive Withheld Customer Payment: What Legal Steps Should I Take?

Hi everyone,

I need your help. One of my Sales Executives received an amount of 25000/- from a customer but has not yet paid the company since February 2015. We have verbally informed him to pay the due amount to the company, but he still has not paid.

Kindly advise me on the legal procedure to pursue in this situation. Should I issue a memo to him? If a memo is required, please send me the format.

Thank you.

Do you have any proof that this Sales Executive took the $25,000 from the customer, like a receipt given to the customer, etc.? If yes, then it amounts to outright theft/embezzlement from the company. Issue him a letter to pay up within a specific timeframe, 1-2 weeks. There's no specific format—it's a straightforward letter giving the details of the transaction and what you want the guy to do. If he still ignores it, just lodge a police complaint. Guess you have waited long enough.

Regards, TS

Documenting the Transaction

Talk to the customer and get all details of the transaction in writing on company letterhead and rubber stamp. Include the date, voucher number, purpose, amount, recipient's signature, etc.

Drafting a Letter to the Salesman

Afterward, write a simple, clear letter to the salesman:

Shri ----

It has been reported by M/S ---- Company that a sum of Rs ------ on account of ---- (Nature of transaction) was handed over to you on -----. However, the said amount has not yet been deposited into the company account.

You are hereby directed to account for the said transaction by ---(date not more than one week). Please provide reasons for the delay in recording the transaction by ---(date).

Necessary action will be initiated against you in case of any further delay. Kindly give it to him and obtain a receipt for the letter.

Further Actions

Subsequently, take action, including filing a police complaint if necessary. The integrity of the person is doubtful based on this action.

Since the transaction took place over a year ago, it is now more urgent to expedite actions on top priority.