Piyush is the founding Partner of Delhi based law firm named PSP LEGAL. Presently, Piyush and PSP Le... Read More
How To Defend A Money Recovery Case?
I took some amount from a person to do business. I have lost the entire amount in business. I have no money to pay him back. What can I do if he takes a legal action?
- Sector-1, Noida
You can file for insolvency with the help of a business lawyer in India.
On filing petition of insolvency, the court will fix a date for hearing and the borrower will be required to file all books of accounts, income statements, details of his assets etc. The court will investigate on this to ensure that he is genuine and he has made full disclosure of his assets. The treatment of the debt will be as per the court’s verdict. However, if the loan is having collateral, the lender still has all the rights to acquire the mortgaged asset. For non-collateralized loans like personal loans or credit card loans, the lender will have to follow the court's directives. On being declared as insolvent, the court will appoint an officer who will take charge of the property and take decisions on dividing it among the lender(s) to settle his debts. There is no fixed period for legal recourses and the proceedings depend upon the complexity of each case. The advantage of the borrower on declaring insolvency is that the lenders will no longer be behind him for recovery. Also, while the matter is in the court, the lenders cannot file separate suits against the borrower without the court’s permission.
Answered on 03 Sep 2019
1/1 people found this helpful
Didn't find the answer you are looking for?
Talk to experienced lawyer online and get your answered in minutes.