1. Civil Suit for Recovery of Debt

You can file a civil suit in a court of law to recover the debt. This is generally done in a civil court where you present evidence of the loan agreement and the failure of the borrower to repay. To strengthen your case, you need to provide evidence such as a written loan agreement, promissory notes, receipts, or any communication between you and the borrower regarding the loan. If the court rules in your favor, it will issue a judgment against the borrower. You can then take steps to enforce the judgment and recover the amount, which may include garnishment of wages or seizure of assets.

2. Negotiation and Mediation

Before pursuing legal action, try negotiating with the borrower to resolve the matter amicably. Sometimes, borrowers may be willing to repay the loan in installments or agree to a settlement. You can also opt for mediation services, where a neutral third party helps both parties reach an agreement. Mediation can be a quicker and less expensive way to resolve disputes.

3. Criminal Proceedings for Cheque Bounce

If the borrower issued a cheque that bounced due to insufficient funds, you can file a complaint under Section 138 of the Negotiable Instruments Act, 1881. This section deals with dishonor of cheques and provides a legal recourse for recovery. To file a complaint, you must first issue a legal notice to the borrower demanding payment. If the borrower fails to pay within 15 days of receiving the notice, you can file a criminal complaint in the appropriate court.

4. Debt Recovery Tribunal (DRT)

If the amount of debt is substantial, you can approach the Debt Recovery Tribunal (DRT) under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. The DRT is a specialized tribunal that handles cases related to the recovery of debts and is often faster in handling such matters compared to regular civil courts.

5. Consumer Forum (If Applicable)

If the loan was provided in the context of consumer services or goods, and the borrower is a business or service provider, you may file a complaint with the Consumer Forum under the Consumer Protection Act, 2019. The forum can provide redressal for disputes related to service deficiencies or unfair practices.

6. Arbitration

If there is an arbitration clause in your loan agreement, you may need to resolve the dispute through arbitration. Arbitration is a process where a neutral arbitrator makes a binding decision on the dispute.

Conclusion

If someone does not repay money you lent them, you have several legal options to recover the debt in India. You can file a civil suit, engage in negotiation or mediation, pursue criminal proceedings for cheque bounce, approach the Debt Recovery Tribunal, or file a complaint with a consumer forum if applicable.