• Retired person Cheated by a son’s friend

I am a  retired person living  in Chennai about70 yrs.
My son’s  friend  ‘SR’  (Defaulter)  approached for a loan as he was in a very very difficult situation that  he received a SARAFESI and AUCTION notice from bank.
As I in Chennai and another friend (VJ)Bangalore were running  a very small private part-time chit fund work as a partnership  among friends in need(not a registered business  but with a name S  and nominees)
Though our chit fund work is very small  to help DEFAULTERs’ requirement, considering the plight of my son’s teary situation,  we told DEFAULTER that we will try our best to help through S and nominees at this time of very difficult situation of loosing his dwelling.
•	Immediately Defaulter sent an email request to ‘S and nominees’ email address for a loan of 25 Lakhs with the request that SR (Defaulter) will transfer the mortgage held by the the bank to S and nominees or anyone whom we may suggest. This amount was too big for us. So we told DEFAULTER that using our equity and friend’s circle we will try to help him out.
Our son also recommended AS’s situation considering the plight.
•	Then DEFAULTER sent an agreement in Rs20, signed by him and his brother as the guarantee with two witnesses. The agreement was not registered. The terms mentioned are 
1.	Repayable  latest by 14-12-2016
2.	Interest 1.5% per month Payable every month
3.	Failure to pay every month to attract additional 1% interest per month
In the agreement SR did not mention about “the transfer the mortgage from the bank to S and nominees or anyone whom we may suggest”. Unfortunately, we overlooked this point, considering DEFAULTER’s plight and confidence and as he was recommended by my son.
So we discussed with the bank where defaulter’s property was held and arranged for stepped payment as we had good relationship with that bank .Unfortunately we failed to make a triparted agreement with Bank and DEFAULTER.
Eventually, through my bank account we paid all dues to DEFAULTER and in turn SR (defaulter)  paid the bank by 15-12-2014.
Just after redeeming the documents from bank, DEFAULTER started the delay tactics to not to transfer the mortgage to S and nominees or anyone of us.
He managed to convince my son saying, he will give a GPA to my son’s name  and GPA is more valuable than mortgage and he will settle the loan with in few months.
Out of trust and stupidity, my son accepted to this and convinced to agree for GPA which was registered at SRO.
Then DEFAULTER started hurling his surprises
After 4 to 5 months, he cancelled the GPA
Never paid any interest and principal
Stopped answering to emails and phone calls.
As novices, we trusted this fellow DEFAULTER and his brother and my son’s stupid recommendation, about which he is at remorse now.
We checked and confirmed that he legitimately owns the property.
We met DEFAULTER at his house in November 2016 and requested to fulfil his promise of Transferring the Mortgage and we are willing to give more time to pay the loan.
•	But he flatly refuses to Transfer  the Mortgage saying he will soon pay the loan.
To the extent he goes saying, “do you want to kill me?”  It was pathetic and appalling.
Now it is March 2017, and he never responds to phone calls or emails.
It is a very shameful situation to tell anyone.
Any one except SR will understand  the mental stress that I go through every day for helping some one in difficult situation.  My son is paying interest to the lenders along with his problems with lot of regrets.
If we complain to the police do we still have chance: 
1.	To get the property mortgaged to either a) S and Nominees or b) any one whom we suggest or c) to me as the funds went through my account?  Now I prefer it is mortgaged to me or to my family members as I am getting weak and tired , and my partner is OK with that.      Is it possible?
2.	To Recover the principal and Interest?
As it is a cheating scenario, will it be a criminal case or just a civil case ?
How long will it take if it is either criminal or civil case ? I am 70 years plus now.
How much will be the legal cost and court fee? It is going to be another issue to pay these.
3.	Can someone (son/friend/daughter) represent me to police and court considering my age?

Thank you
Asked 7 years ago in Criminal Law
Religion: Other

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4 Answers

1) file police complaint of cheating and crriminal breach of trust against the defaulter under section 406, 420 of IPC

2) file summary suit to recover the loan amount with interest under Order XXXVII of CPC

3) there is no clause in agreement for mortgage . you cannot insist borrower mortgage property to you

4) you can get faster results in summary suit . if defense raised by borrower are moonshine court would direct him to deposit principal with interest in court then only permit him to defend the suit

Ajay Sethi
Advocate, Mumbai
95221 Answers
7612 Consultations

5.0 on 5.0

cheating is a civil wrong as well as an offence. so you can file both civil case and criminal case simultaneously. you can claim damages under civil suit and punished him by filing criminal case. you have right to recover principal amount with interest under section 34 of CPC.

Shivendra Pratap Singh
Advocate, Lucknow
5127 Answers
78 Consultations

4.9 on 5.0

1. A complaint with the police will not deter the defaulter but he may even pretend to agree before the police to execute mortgage deed as promised earlier, however he my not be willing to do so anytime in future nor you will get any solution for this through police.

2. This is a civil issue if you want to recover the amount from you or it can be a criminal case if he has just to be punished for cheating.

The civil litigation would cost in the form of court fee and lawyer's fee, this would depend on the geographical location where you would initiate legal process.

The court fee differs from one state to another.

The time taken in both civil as well as criminal cannot be predicted.

3. You can execute a power of attorney in favor of any of your close relatives to prosecute the case on your behalf.

T Kalaiselvan
Advocate, Vellore
85422 Answers
2239 Consultations

5.0 on 5.0

1. Actually, you should have taken legal opinion before providing the said loan but it is a reverse case for you.

2. Hope you have all the evidence of his praying for loan from you to be paid to the mortgagee bank from where he had availed loan.

3. You have evidence that you have paid the said amount to him at his account.

4.Please note that you can t charge interest as per your own wish beyond RBI guidelines and you can not lend money commercially without obtaining license from the RBI.

5. However, you should now lodge a police complaint against he aid person alleging that the has taken loan from you being your son's friend and is not returning the same now which he had earlier assured.

6. Also file a Civil Suit claiming refund of the said amount with inter as per Bank's rate of interest, damage and cost.

7. You can file a writ Petition before the High Court against the police inaction seeking relief.

8. Litigation is expensive all over the world and the fees varies from lawyer to lawyer and place to place, Each case might take Rs.50 K to be filed and Rs.3 K per appearance to be charged by he lawyer towards his appearance fee.

Krishna Kishore Ganguly
Advocate, Kolkata
27245 Answers
726 Consultations

5.0 on 5.0

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