How people usually put it
The builder took my money and never handed over the flat. The insurance company rejected my claim. His cheque bounced and he is not picking up the phone. Shop will not replace a defective phone. Cheque bounce ayi, paisa tharunnilla. Builder flat tharunnilla. ചെക്ക് മടങ്ങി. ഇൻഷുറൻസ് കിട്ടിയില്ല.
Cheque bounce: the dishonour, the notice and the 30 days
A prosecution under section 138 of the Negotiable Instruments Act, 1881 needs three steps kept in order: the cheque is presented within its validity and returned unpaid; a written demand notice is sent within 30 days of receiving the bank's return memo; and if the money is not paid within 15 days of that notice, a complaint is filed before the Magistrate within 30 days after that period ends.
Dashrath Rupsingh Rathod v. State of Maharashtra (2014) 9 SCC 129 and the amendment that followed settled where the case is filed: the court where the payee's bank branch is located. In Re: Expeditious Trial of Cases under Section 138 of the NI Act, 1881 (2021) 16 SCC 116 gave directions to speed these trials up, including summary trial as the norm and encouragement of settlement.
Interim compensation of up to 20 per cent of the cheque amount can be ordered while the case is pending, and the Appellate Court can order a deposit before hearing an appeal.
Insurance cannot be refused on a technicality
Courts have held that an insurer cannot repudiate a claim on a ground that has no bearing on the loss. Exclusion clauses must be proved by the insurer, and a policy is read against the person who drafted it. Delay in intimation, by itself, has been held not to defeat an otherwise genuine claim where the delay is explained.
Builders and delayed flats
Pioneer Urban Land and Infrastructure v. Govindan Raghavan (2019) 5 SCC 725 holds that a one-sided builder's agreement is an unfair trade practice, and a buyer faced with long delay may refuse to take possession and claim a refund with interest rather than being forced into the contract. Remedies lie before the consumer commission and, for registered projects, before RERA.
Where a consumer complaint is filed
Under the Consumer Protection Act, 2019, a complaint may be filed where the consumer resides or works, not only where the trader is, and it can be filed online. The limits are: District Commission up to ₹50 lakh, State Commission up to ₹2 crore, National Commission above that. A complaint must ordinarily be filed within two years of the cause of action, with delay condonable for sufficient reason. There is no need for a lawyer; the consumer may appear personally.
Medical negligence
Indian Medical Association v. V.P. Shantha (1995) 6 SCC 651 holds that medical services for payment come within consumer law, so a patient may go before a consumer commission. Jacob Mathew v. State of Punjab (2005) 6 SCC 1 sets the standard for criminal liability of a doctor, which is much higher than for compensation.
How to use this
Keep every receipt, the agreement, the bank memo and the notices with proof of dispatch. In a money claim, the date of the bank's return memo or the date of the agreed payment starts the clock, and these limitation periods are strict. The District Legal Services Authority helps with drafting for those who cannot afford an advocate.
This guide is legal information, not legal advice, and reading it creates no advocate–client relationship. Laws change and every case turns on its own facts. For anything serious, consult an advocate — and if you cannot afford one, the District Legal Services Authority will give you a lawyer free of cost.
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