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Q1: Whether Companies/ Banks of a foreign country could prosecute an Indian national and Indian passport holder, who has taken a financial facility from the Company/ Bank in a foreign country and has subsequently fled into, and for the time being residing in India ?

Ans. YES. Both civil and criminal prosecution can be initiated against the person in India under the relevant statutes. Under Section 83 of the Code of Civil Procedure and Section 188 of the Criminal Procedure Code read with Section 3 & 4 of Indian Penal Code, the Civil Courts and the Criminal Courts of India respectively have the civil and criminal extra territorial jurisdiction to try and adjudicate such cases.

Q2: Whether under the laws of Republic of India, a criminal case can be made out against a person, who does not or fails to liquidate his financial obligations to a Bank, Company or any other organization or person?

Ans. YES. However, before instituting such a complaint, one has to ensure that the conduct of such a financial defaulter from the inception of the transaction constitutes mens rea (dishonest intention). The Indian Penal Code recognizes such offences as “cheating”. Various Courts of India including the Hon’ble Supreme Court of India on different occasions, have also reinforced the view that “many a cheatings are committed in the course of commercial and money transactions".

Q3: Does Capital Factors initiate or cause to initiate civil prosecutions on behalf of its clients against their defaulters?

Ans. As a matter of principle, in Debt Recovery Assignments, Capital Factors does not resort to civil litigation, because, in case of civil suits for recovery, one has to pay a substantial court fee. Even otherwise, a civil litigation in India involves a lot of procedural compliances, which elongates the time span of final adjudication of the case to years. The aggrieved companies normally are not open to make further investments in terms of court fee against presumably a fictitious asset (doubtful debt) nor do they wish to wait for a long period of adjudication, in which case, the very purpose of recovery is vitiated, if the decree is passed in their favour after a long span of time.
Even though a money decree is passed by a competent court against any defaulter of a Company, the execution of such decrees in India is again time consuming and involves a lot of legal complications.

Q4: How does Capital Factor initiate prosecution on behalf of the clients?

Ans. Capital Factors does not initiate prosecution for any client, rather it facilitates a successful prosecution against defaulters of such companies. The companies have to initiate prosecution through duly constituted attorneys.

Q5: Do Capital Factors has a research wing to support its client companies in legal research?

Ans. YES. Capital Factors has a well constituted research wing comprising of brilliant lawyers and professional legal managers, dedicatedly doing legal research pertaining to various services provided by Capital Factors including Debt Recovery. Capital Factors for the purpose of research has sufficient subscriptions to database for domestic law and legal materials such as www.manupatra.com and www.scconlline.com. For the purpose of research on international law pertaining to the services provided by Capital Factors, the company also has sufficient subscriptions to international legal data base such as WESTLAW ® and LEXIS NEXIS ®

Q6: What is the fee structure acceptable to Capital Factors and how does Capital Factors charge its fees?

Ans. For recovery assignments, Capital Factors charges a fee ranging from 15% to 30% of the actual recovery effected from the defaulters. However, in case Capital Factors has to depute any person for the sole service to the client, the cost of such person has to be borne by the client.

Q7: In case of any NBW or Warrant of Attachment issued by a competent Court against any defaulter of a Company, do Capital Factors has any mechanism to facilitate execution of such NBWs or WAs by way of tracing, identifying or locating the assets of the defaulter?

Ans. YES. Capital Factors has a well constituted mechanism comprising of experienced and trained professionals to facilitate execution of NBWs and Warrant of Attachments.

Q8: Who on behalf of Capital Factors does the negotiations with the defaulters of its clients?

Ans. Capital Factors has a negotiation department comprising of professional, legal managers, especially trained with modern negotiation techniques and negotiation psychology, who are capable enough to derive utmost advantage for its clients, by way of negotiation with adamant and hard core defaulters.

Q9: What role does CFR play, in case a defaulter initiates any retaliatory litigation against any client of CFR, in consequence to CFR’s recovery drive?

Ans. Capital Factors always strive to ensure that every legal action taken on behalf of the client is based upon substantial legal substratum and will be sustainable upto the higher courts of India . However, it is impossible to stop any defaulter from initiating frivolous litigation and in such an event, Capital Factors provides utmost legal support to its clients to defend such retaliatory litigation.