Sir I am Bhargav, My dad is a government employee, He gave surety to his friend to get the chit amount from Sriram Chits. Now he was missing since September 2014, we don't have any details about him now since he was missing. Here I need to mention one thing According to the norms chit fund companies have to take minimum 2 or 3 securities from individual persons but they misguided my dad now we got to know that we are the only one gave him surety, now they are forcing us to pay the full amount of 4.5 lakh with interest.
Sir We are middle class family my dad salary amount monthly 23000 and I have one sister she is 12th now. Am about lo leave Germany sir I got full scholarship in University of Kiaserslautern for masters. Don't know what to do, can we proceed legally, as they are cheated my dad for surety.
Asked in Property Law from Hyderabad, Andhra Pradesh
1. What is the nature of document by which your father was stood as surety?
2. if it was by a written document and the loan was valid and permissible then your father is liable to make the payment in the event the borrower is failing and neglecting to make the payment.
3. many Ponzi schemes in india are unlawful. So check whether this one is valid or illegal.
1) since your father has give surety for his friend your father would be liable to make payment in the event of default by the principal borrower .
2) it is necessary to peruse the document executed by your father to advice further .
3) in the event your father makes payment your father can sue his friend to recover the said amount with interest
1. What is the nature of document which your father executed with his friend?
2. In a contract of guarantee there are three parties: creditor, debtor and the surety-guarantor. Section 128 of the Indian contract Act provides that the liability of the guarantor is co-extensive with that of the debtor. In the absence of contract to the contrary the creditor can recover the loan from the guarantor without taking steps to recover it from the debtor. If your father stood as a guarantor then he will be liable in the event the amount is not paid by his friend as the liability of a guarantor is co-extensive with the liability of the debtor.
Hi, as your father has stood suriety if the principal borrower had fail to pay amount it is the duty of surity to pay the amount and thereafter you can recover the same from principal borrower. You have no option Better settle the mater amicably.
1. The documents are required to be seen for giving proper advise,
2. Most of the chit funds in India are unlawfully conducting their businesses,
3. It has to be examined first whether the said chit fund business is legal or not,
4. If, not the the said surity given to guarantee payment committed by an illegal chit fund is not binding,