Hi - My name is Varun. On 5th Oct I signed an rental agreement with an lessee with an understanding were he gave me post dated cheque dated for 10th Oct for advance deposit amount. But around 10th he constantly kept pushing me to not produce the cheque due to lack of funds. After 20 days of waiting I produced the and cheque and received a return memo to make the agreement void. In the agreement we mentioned the cheque details and also stated possession will be most realization of the cheque. Original agreement and property keys is still with me. I wanted to confirm if I need to do anything else to make the agreement void... Send any written notice or anything. Also, wanted to understand if he can sue me under any other reason
1. Since the cheque was returned for lack of sufficient funds in the account of the lesse and the cheque number and the amount is mentioned in the agreement, the agreement automatically becomes null and void.
2. Better to send a legal notice, mentioning the fact of dishonour of cheque and thereby the cancellation of the agreement of lease already entered.
3. The Lesse cannot sue you, reason being that the breach of contract was from his side only.
Send notice to lessee that cheque has been dishonoured on presentation
2) that as per x clause in agreement possession was only post cheque clearance
3) hence you are unable to deliver possession of premises to lessee and agreement stands terminated
Dear Sir,
The terms of the agreement to be looked into. In the meanwhile file cheque bounce case by following the below given procedure:
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Cheque bounce FAQs Negotiable Instruments Act
1A. Amended Cheque Bounce Provisions- 143A & 148…what is it?
Ans: Section 143A- It empowers the Court to order the drawer of the cheque to pay Interim Compensation - 20% - Without depositing this amount the accused cannot defend the case.
Section 148 – It empowers the Appellate Court to order payment pending the appeal against conviction
The Appellate Court may order the appellant to deposit an amount which shall be a minimum of 20% of the fine or compensation awarded by the trial Court.
This amount shall be in addition to the amount already paid by the appellant under Section 143A.
It received the assent of the President and was notified in the Official Gazette on 02.08.2018
1. In which court do I need to file the complaint case under Section 138 N.I. Act in case drawer did not pay after receiving notice?
A complaint case under Section 138 N.I. Act can be filed in any competent court in whose jurisdiction any of the following acts have occurred:
a) Place of drawing of the cheque,
b) Address of bank where cheque was presented (holders bank address),
c) Address of bank where cheque is payable (drawers bank address)
d) Place from where notice was received by drawer of cheque
a. It is possible that each of these four acts could have occurred at different localities. The complainant can choose any one the above places to determine jurisdiction of court where they wish to file complaint.
Thanks. I don't want to file cheque bounce case as I have other tenants who are interested to rent and want to close it. Good to hear agreement automatically becomes void and null. Few follow questions - 1) If the lessee does not even have the original copy of the agreement can he even go to court? As the original copy was retained by me and he just took photos 2) If I have to send notice what would be the charges?
You are welcome.
1. The Lessee is not likely to go to Court, more so, as per your information that the Lessee does not have the original.
2. The charges differ from Lawyer to Lawyer and it can't be quantified. However, it may be less than Rs.5000/-.
1) he can go to court on basis of xerox copy of agreement
2) take plea that original is lying with you
3) if you say you do not have original then they can lead secondary evidence for the lease deed
4) charges for issue of legal notice vary depending upon lawyer engaged by you
See since the cheque bounced and deposit amount is not realised the agreement is void , you can issue legal notiCe intimating same and can seek damages from.him for the loss of revenue and other expenses.
1. He basis of the Xerox or photos can go before court though he is at default so no relief is available to him.
2. It shall be as per lawyer you engage.
1. There is no need to send any legal Notice and neither the courts will entertain any grievance in the matter. Further the Tenant has no legal standing, AFTER his cheque has bounced for whatever reason. The lease agreement stands revoked.
2. IF you had not given possession in anyway THEN do not try to initiate anything legal, since it will affect your future other tenants probabilities, since the Tenant could get a interim stay order on you from keeping any other tenants, based on the certified copy of agreement which he can procure from the registering office (if the agreement was registered). IF the agreement was NOT registered, THEN as it is the agreement is legally null & void and has no legally enforceable value.
Dear sir,
The tenant who is in possession may approach the court and get stay against owner and thus continue his stay . You may get issue a legal notice Under section 106 of transfer of property act . It costs Rs 5000- 10,000/- depending upon the profile of advocate you choose.
If the rental agreement clearly states that possession of the premises will be given post realization of the cheque and the cheque has not been honoured, then the Lessee/tenant cannot claim possession, if he is not put in possession why would he go to the court where is there a binding agreement for him to take the legal recourse.
On the other hand since the cheque has bounced and you have not received payment, you are not legally bound to accept the terms of the rental agreement. Hence you can proceed to destroy the rental agreement (Original rental Agreement) and enter into a fresh or new rental agreement with any third party. You don't even have to send him any written notice or e-mail to this effect as his bank would have informed him about the return of his cheque.
The rental agreement entered into with the previous lessee/tenant has become void.
Cheque bounce case not maintainable. Cheque is bounced, lease deed expired. Photos are secondary evidence, original court can summon.
At least you have to inform him about cheque bounce and consequently deed expired.
- As per law, if either of the parties of an agreement fails to honour the clauses /conditions , then that agreement not having any legal value,
- Since, there was a condition , that the possesson will be handed over on the realizatioin /encashment of the given cheque , then upon bouncing of the said cheque , the agreement itself fails, and cancelled.
- It doesnt matter , who is having the origional copy of the said rent agreement, and a suit upon the said void agreement is not maintainable.
Since he ha failed to pay the advance amount as per the agreement, i.e., as the cheque given for the purpose has been returned by the bank without honoring the same, the agreement is null and void.
You can inform him that the agreement stands cancelled due to this reason, if at all he wants to continue with the agreement, let him make the payment by transfer towards the deposit amount after which you can consider his request.
You dont handover the keys, he cannot initiate any legal action on this.
Since the cheque submitted by him for the deposit has bounced, the agreement stands cancelled automatically because that was the basis for this agreement, hence no case is maintainable.
The lawyer's fee for sending the notice hall depend on the lawyer who you will be engaging.
Send a written notice and cancel the said agreement
issue a notice to lessee that cheque has been dishonored . It would depend upon the terms in the agreement. If there is a clause in the agreement that stipulates that if the cheque of the lessee is not honoured than the agreement will become void and ineffective.
While filing any case one has to sign an affidavit that all the documents or evidence/evidences filed by the filing person is true and therefore any Xerox of the original can have the same effect as the original copy.
1. this exercise was not needed
2. the parties could simply sign a cancellation agreement for cancelling the original agreement
3. was the lease deed registered?
Yes the agreement will be null and void but for that you have to send him a legal notice for providing him a opportunity to pay the money.
In legal notice You should mention that In case of failure in payment of money the agreement stand null and void.
Charges of notice depends on the advocate you will hire.
