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Friday, 23 January 2015

Steps to Recover Pending Dues

Be it clients or employers who refuse to settle your dues, here is the legal ways available to get back the money:-

  • Civil Remedy: Order of Civil Procedure Code allows the creditor to file a summary suit. Summary suits are disposed of faster. Once the suit instituted and the summons are issued, the defendant has 10 days to make an appearance, failing which the court assumes the plaintiff's allegations to be true and, accordingly, awards the plaintiff. The summary procedure applies to all suits for recovery of money that arise from written agreements. This could be promissory notes and contracts, bills of exchange or cheques, so long as the plaintiff seeks to recover specific-debt.

    Another option is the Negotiable Instruments Act, 1881, which only deals with the recovery of money arising from instruments such as bills of exchange or cheques. Another option is the Negotiable Instruments Act 1881 which only deals with the recovery of money arising from instruments such as bills of exchange or cheques. This act contains several sections, each outlining the procedure for recovering money under a specific instrument.

  • Criminal Proceedings: There is also an option of initiating criminal proceedings against the defaulter under the Indian Penal Code. A case of criminal breach of trust or cheating or even mischief can be filed. Criminal proceedings usually take to conclude. Plaintiff may end up wasting valuable time and effort in court to recover dues.

  • Out of Court Settlement: Arbitration or conciliation will be the most economical ways of recovering money. Apart from these options, one can also file a winding up petition against a client if he is not able to pay the debits.

  • To avoid all the above time-consuming processes, it is best to take some precautions at the outset. Experts recommend a written contract between the parties involved. The contract must contain details of the transaction in clear terms, including the date on which the amount was lent and the exact principal amount and the interest. Though not mandatory, it is ideal to have the documents executed on a stamp paper and get it registered.