TMI Blog2009 (11) TMI 1011X X X X Extracts X X X X X X X X Extracts X X X X ..... the court is satisfied that at the time when the loan or any part thereof, to which the suit relates was advanced, the moneylender held a valid licence, and if the court is satisfied that the moneylender did not hold a valid licence, it shall dismiss the suit. As per explanation to Section 138 of the Negotiable Instruments Act debt or other liability means a legally enforceable debt or other liability. So, a loan advanced by a money lender who is doing business of money lending without licence is not a debt or other liability and provisions of Section 138 of the Act will not apply to such transaction. In the light of above, it cannot be said that in the present case, that the cheque issued by the Respondent in favour of the applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onths. The applicant paid the amount. However, according to the applicant, the respondent failed to repay the amount and therefore demand was raised by applicant pursuant to which the present respondent issued cheque dated 24.5.2005 drawn on Post Office Savings Bank, Ahmednagar Branch, for ₹ 2.00 lakhs. On 25.5.2005, the applicant deposited that cheque in the said bank for encashment, but the same was dishonoured on the ground of insufficiency of funds. 3 . Thereafter on 4.6.21005, the applicant issued notice to the Respondent calling upon him to pay the amount within fifteen days and since the amount was not paid, the complaint under Section 138 of the Negotiable Instruments Act was filed. The trial court took cognizance of the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mployee of the Income tax Department. She produced income tax returns of the present applicant at Exhibits 52 and 53 and in paragraph 16 of the judgment, the trial court noted that the total income of the applicant in the year 200203 was ₹ 60,000/= and for the year 200304, it was ₹ 57,989/= and it is amply clear that the person having such income could not have lent amount of ₹ 4.00 lakhs in lumpsum to the respondent accused. There is no other documentary evidence led by the complainant to prove that he actually lent ₹ 4.00 lakhs. It is the case of present Respondent that he borrowed amounts of ₹ 10,000/= and ₹ 20,000/= from the applicant and repaid ₹ 50,000/=. However, while giving loan, the applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nding except in the area for which he has been granted a licence and except in accordance with the terms and conditions of such licence. It is not the case of present applicant complainant that he has any money lending licence. Section 10 of the Act lays down that no court shall pass a decree in favour of a moneylender in any suit to which said Act applies unless the court is satisfied that at the time when the loan or any part thereof, to which the suit relates was advanced, the moneylender held a valid licence, and if the court is satisfied that the moneylender did not hold a valid licence, it shall dismiss the suit. In other words, carrying on money lending business without licence debars a person from doing money lending and recovering ..... X X X X Extracts X X X X X X X X Extracts X X X X
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