An NRI or foreign company can recover money from an Indian debtor through a legal notice, a criminal complaint if a cheque has bounced (Section 138 of the Negotiable Instruments Act), a summary suit under Order XXXVII of the Civil Procedure Code on a written contract or invoice, an insolvency application under section 9 of the IBC for operational debts of ₹1 crore or more, or arbitration where the contract provides for it. A power of attorney holder in India can file and give evidence on your behalf.
- Cheque cases
- Section 138, NI Act 1881
- Civil suit
- Order XXXVII CPC
- Insolvency route
- IBC section 9, ₹1 crore
- Limitation
- Generally 3 years
Choosing the right route
| Your situation | Main route | Why it works |
|---|---|---|
| You hold a bounced cheque | Section 138 complaint, plus civil suit if needed | Criminal liability and interim compensation push the drawer to pay |
| Written contract, invoice or loan agreement | Summary suit under Order XXXVII | The defendant needs the court's leave to defend |
| Unpaid supplies or services to an Indian company, ₹1 crore or more | Demand notice and IBC section 9 application | The company risks insolvency proceedings if it cannot show a genuine dispute |
| Contract with an arbitration clause | Arbitration, with interim relief from the court | The clause usually rules out a civil suit |
| Money taken by deception | Police complaint for cheating, alongside civil recovery | Fraud is a crime; see our cyber and fraud page |
Every route starts with a properly drafted legal notice. Many debtors pay or propose instalments at that stage, especially when the notice comes from an Indian law firm and refers to specific proceedings.
Bounced cheques when the payee lives abroad
If an Indian debtor gave you a cheque that bounced, the strict Section 138 timetable applies: a demand notice within 30 days of receiving the bank's return memo, 15 days for the drawer to pay, and a complaint within one month after that. The complaint is filed where your bank branch is, so an NRO or resident account in India is usually where the cheque is presented.
You do not have to fly back to depose. In A.C. Narayanan v. State of Maharashtra (2013), the Supreme Court held that a complaint can be filed through a power of attorney holder, who can also give evidence, provided they have personal knowledge of the transaction and the complaint says so. Where the attorney holder lacks that knowledge, your own evidence can often be recorded by video. On first appearance of the accused, the court can order interim compensation of up to 20% of the cheque amount.
Summary suits and commercial courts
Order XXXVII allows a fast-track suit to recover a debt or liquidated sum based on a written contract, a bill of exchange, a promissory note or a guarantee. The defendant cannot simply file a defence; they must apply for leave to defend and show a real triable issue. Courts often grant conditional leave, requiring the defendant to deposit the amount first.
Where the claim is a commercial dispute of ₹3 lakh or more, the suit is heard by a commercial court under the Commercial Courts Act 2015. Before filing, pre-institution mediation under section 12A is mandatory unless you seek urgent interim relief. Limitation for most money claims is three years from when the amount fell due, and an acknowledgment of debt in writing restarts it.
Insolvency and MSME routes for business debts
A foreign supplier owed money by an Indian company is an operational creditor under the Insolvency and Bankruptcy Code 2016. It sends a demand notice under section 8; if the debtor does not pay or point to a pre-existing dispute within ten days, the creditor can apply to the National Company Law Tribunal under section 9. The minimum default is ₹1 crore. The IBC is not a debt collection tool: if there is a genuine dispute raised before the notice, the application fails, as the Supreme Court held in Mobilox Innovations v. Kirusa Software (2017).
You may have heard of MSME Samadhaan, which lets small suppliers claim delayed payments with high interest. It is available only to Indian micro and small enterprises registered on the Udyam portal. A foreign supplier cannot use it, though an Indian subsidiary registered as an MSE may be able to.
Running a recovery case from abroad
Most clients appoint a family member or our team as attorney holder through a power of attorney signed abroad, notarised and apostilled or consular-attested, then stamped in India within three months of receipt. Pleadings and affidavits can be signed where you are. We send you scans of every filing and a short update after each hearing, and arrange video calls in your time zone before key dates.
Money recovered in India is credited to your NRO account and can be sent abroad within FEMA limits; see repatriation of funds.
When the debtor is a relative or friend
A large share of the recovery work we do for NRIs involves money lent to relatives or friends, or handed over to them to buy property, invest or look after. These cases are rarely documented like a commercial loan, but they are often stronger than clients expect. Bank transfers from your NRE or overseas account prove that money moved. WhatsApp messages and emails in which the person refers to the amount, promises repayment or describes what they did with it are admissible as electronic evidence with the required certificate. If a relative bought property in their own name with your money, the claim may also be for a declaration of your interest, not just repayment.
Family cases benefit from a staged approach: a firm but measured legal notice, an offer of mediation, and proceedings only if those fail. We draft settlement agreements that record the amount, the instalments and what happens on default, so that a broken promise leads straight to a decree rather than a new dispute.
Mistakes we see in NRI recovery cases
- Lending without paper. Money sent by bank transfer leaves a record, but a short written acknowledgment of the loan makes recovery much easier.
- Missing the 30-day notice deadline on a bounced cheque because the cheque was presented by a relative who did not pass on the return memo.
- Letting limitation run while waiting for promises. Three years passes quickly; get a written acknowledgment or file.
- Threatening criminal action without a basis. A civil debt is not cheating unless there was dishonest intent at the start, and false complaints can backfire.
Documents you need
Scans by email or WhatsApp are enough for us to advise. Originals are needed when we file.
- Loan agreement, contract, purchase orders or invoices
- Bank transfer records showing the money paid
- Bounced cheque and the bank return memo, if any
- Messages or emails in which the debtor admits the debt
- Your passport, visa or OCI card and overseas address proof
- Power of attorney in favour of the person acting in India
- Company documents and board resolution if the creditor is a company
How we handle it for you
Review the paper trail
We check the documents, the limitation period and which routes are open.
Send a legal notice
A notice that states the debt, the deadline and the proceedings that will follow.
File the strongest proceeding
Cheque complaint, summary suit, IBC application or arbitration, or a combination.
Seek interim protection
Interim compensation, deposit orders or attachment before judgment where justified.
Settle or enforce
A written settlement with default clauses, or execution against bank accounts and property.
Why clients choose ProudLegal
Built for clients abroadVideo calls in your time zone and documents signed where you live.
Advocates who appear in Indian courtsYour case is drafted and argued by enrolled advocates in India.
Written fee quote firstScope and fees confirmed in writing before any work starts.
Updates after every stepScans of every filing and order on WhatsApp and email.
Frequently asked questions
Can an NRI file a cheque bounce case in India without coming back?
Yes. The complaint can be filed and evidence given by a power of attorney holder who knows the transaction, as the Supreme Court held in A.C. Narayanan (2013). Your own evidence can also be recorded by video where needed.
How much time do I have to recover a loan in India?
A suit for money lent is generally to be filed within three years from when the loan became repayable. A written acknowledgment signed by the debtor before the period expires starts a fresh three years.
Can a foreign company use IBC to recover dues?
Yes, as an operational creditor, if the unpaid operational debt is at least ₹1 crore and there was no genuine dispute before the demand notice. It is a serious step that puts the company's survival at stake.
Can a foreign supplier use MSME Samadhaan?
No. The delayed payment remedy under the MSMED Act is available only to Indian micro and small enterprises registered on Udyam.
What is a summary suit?
A suit under Order XXXVII CPC on a written contract or negotiable instrument where the defendant must get leave to defend. It is faster than an ordinary suit when the paperwork is clear.
Is it a crime if someone does not repay a loan?
Not by itself. Non-payment is a civil wrong. It becomes cheating only if the person intended to deceive when they took the money, which must be shown by facts.
How do I receive the recovered money abroad?
It is paid into your NRO account in India and can be remitted abroad within the USD 1 million a year facility with Form 15CA and 15CB.
What will the recovery case cost?
Court fees depend on the state and the amount claimed. We quote a fixed fee for the notice and stage-wise fees for proceedings, in writing, before we start.