Apni Law Staff asked 6 months ago
A real estate company’s Vice President issued a handwritten receipt to a client for an office space booking. Later, the company claimed that their records showed a smaller amount than what the client’s receipt indicated. This discrepancy arose because the booking was initially made by a person named ‘B’ and then transferred to ‘A’. Faced with police pressure, the company forced ‘A’ and ‘B’ to settle the difference by depositing the missing amount. The company is now the first party, and ‘A’ is the second party. How can ‘B’ protect themselves from potential legal action under Section 138 of the Negotiable Instruments Act?
Best Answer
Apni Law Staff answered 6 months ago
Since ‘B’ was not directly involved in the transaction with the company, they are not liable under Section 138 of the Negotiable Instruments Act. However, ‘B’ might be held liable for the transfer of the booking to ‘A’ if it can be proven that the transfer was fraudulent or involved misrepresentation.
Please login or Register to submit your answer
