Money Recovery Suit
A money recovery suit is a legal remedy that may be used to collect money from a defaulter who has failed to repay a borrowed amount, despite multiple chances and reminders. The suit can be filed under Order IV of the Code of Civil Procedure 1908 (CPC) or under Order 37 of the CPC, which is a summary procedure for suits involving bills of exchange, hundies, promissory notes, or other debts or liquidated demands in money.
The steps involved in filing a money recovery suit are as follows :
Step 1
Send a demand notice to the defaulter, asking him to pay the due amount within a specified time, failing which legal action will be initiated. The demand notice should contain the details of the loan, the amount due, the interest rate, the date of repayment, and the consequences of non-payment. The demand notice should be sent by registered post or courier, and a proof of delivery should be obtained.
Step 2
If the defaulter does not respond to the demand notice or refuses to pay the due amount, file a plaint in the appropriate court, along with the relevant documents, such as the loan agreement, the demand notice, the proof of delivery, the receipts of payment, etc. The plaint should contain the facts of the case, the cause of action, the relief sought, and the valuation of the suit. The plaint should also mention whether the suit is filed under Order IV or Order 37 of the CPC.
Step 3
Pay the court fees and the process fees, and obtain the summons from the court. The summons is a notice issued by the court to the defaulter, asking him to appear before the court on a given date and time, and to file his written statement in response to the plaint.
Step 4
If the defaulter appears before the court and files his written statement, the court will proceed with the trial of the suit, and examine the evidence and the witnesses of both the parties. The court will then pass a judgment, either in favour of the plaintiff or the defaulter, and decree the suit accordingly. The court may also award interest and costs to the successful party.
Step 5
: If the defaulter does not appear before the court or does not file his written statement, the court will proceed ex parte, and pass a judgment and decree in favour of the plaintiff, based on the plaint and the evidence submitted by the plaintiff.
Step 6
If the defaulter does not comply with the decree of the court, the plaintiff can file an execution petition in the same court or in the court where the defaulter resides or has his property. The execution petition is a request to the court to enforce the decree and recover the money from the defaulter, by attaching and selling his movable or immovable property, or by arresting and detaining him in civil prison, or by appointing a receiver to manage his property.
These are the steps involved in filing a money recovery suit in India.
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