• Blank cheque and stamp paper given as security

Hi, i am a 28 yr old female and i had given a blank signed cheque and blank 100 rs stamp paper that also signed as security for the amount taken by my brother from one of his friend . My brother went somewhere without giving any information.His friend is saying that he had given him the amount but I don't have any confirmation about it and now his friend is asking me to refund the amount on my brother's behalf otherwise he will take legal actions against me.please tell what will be the consequences for this.and what should be done now? Please help
Asked 9 months ago in Criminal Law from Pune, Maharashtra
Religion: Other
1) if yiu have given signed blank cheque yiu have authorised the drawee to fill n amount of cheque 

2) drawee can fill in amount and present cheque for payment . If it is dishonoured cheque bouncing case would be filed against you . In addition summary suit would be filed to recover money with interest 

3) you have to take defence that there is material alteration in cheque and date and amounts have been filled in without your consent 

4) contest case on merits 

Ajay Sethi
Advocate, Mumbai
23316 Answers
1220 Consultations
5.0 on 5.0
1. You have stood as guarantor for the loan taken by your brother,

2. You have given the blank and signed stamp paper which will be converted to a guarantee agreement,

3. the cheque will be filled up and deposited as if you have issued it for refund of the loan of your brother,

4. Actually by standing as a guarantor, you have stepped in to the shes of your brother as borrower, if he refuses to repay the loan,

5. Ask your brother to repay the loan and/or get your guarantee released by returning the cheque and stamp paper which the lender will do if and only if some one else can be offered to stand as a guarantor in your place. 
Krishna Kishore Ganguly
Advocate, Kolkata
12127 Answers
233 Consultations
5.0 on 5.0
Your case is very complicated.  You have to hire good, experienced lawyer only.  There are every chances of that person filling up the blank cheque and 100 rs stamp paper and claim the amount. Your Advocate should be able to prove that you have given blank cheque and Rs. 100 stamp paper and later it has been filled up by that person without your consent, thus they are null and void.  
Ravinder Pasula
Advocate, Hyderabad
316 Answers
68 Consultations
4.9 on 5.0
If you cannot locate your brother I will give you one idea.  File a missing complaint in the local Police Station.  The Police will find out him.  Also publish in the local newspapers with caption "Missing".    

Yes, you can instruct your banker for stop payment.  

Taking sign on blank paper is illegal, but the friends fill up the blanks, then it will be difficult to prove that blank cheque has been given.  Hence, I suggested you to hire experienced lawyer.  
Ravinder Pasula
Advocate, Hyderabad
316 Answers
68 Consultations
4.9 on 5.0
1) you can issue stop payment instructions of cheque to your bank 

2)you made mistake in issuing blank signed cheque 

3) also issue notice to drawee that blank cheque had been only issued as security and not to fill in any amounts on the cheque . 

4) call upon person to retrun blank signed stamp papers given by you 
Ajay Sethi
Advocate, Mumbai
23316 Answers
1220 Consultations
5.0 on 5.0
You gave him a blank signed stamp paper which he could have filled up to show that you guaranteed the repayment of loan. The liability of a guarantor is co-extensive with that of the borrower. So the lender can fill up the cheque and present it to bank and if it is dishonoured he can file a criminal complaint for cheque bounce against you. This apart, he can also file a lawsuit for recovery of money with interest against you and your brother. 
Ashish Davessar
Advocate, Jaipur
18167 Answers
449 Consultations
5.0 on 5.0
1. You were supposed to execute the guarantee on stamp paper (or signed the blank stamp paper) only after getting it confirmed from your brother that he has got the loan amount,

2. At least after some time also you could have got the conformation from your brother. No Court will accept your plea now that your said guarantee is subject to the conformation from your brother about his taking the said loan,

3. If you issue stop payment instruction to the Bank, the cheque will bounce (if he deposits it) and he can sue you u/s138 of N.I. Act. Your claiming that you have paid in cash will not hold any water since you will not be able to prove such payment by submitting any evidence in the form of Money Receipts,

4. The said blank stamp paper signed by you shall not stay as blank any more and will be filled up properly  by the lender making it an excellently drafted guarantee agreement.
Krishna Kishore Ganguly
Advocate, Kolkata
12127 Answers
233 Consultations
5.0 on 5.0
Hi, i am a 28 yr old female and i had given a blank signed cheque and blank 100 rs stamp paper that also signed as security for the amount taken by my brother from one of his friend . My brother went somewhere without giving any information.His friend is saying that he had given him the amount but I don't have any confirmation about it and now his friend is asking me to refund the amount on my brother's behalf otherwise he will take legal actions against me.please tell what will be the consequences for this.and what should be done now? Please help

On the basis of the threats he is posing by holding your cheques and bond paper, he is doing a mistake of indulging into a high handed illegal act.  You can issue a legal notice asking him to return the same at the earliest or else you can lodge a police complaint against it.
If he goe to the court, this legal notice shall shield you from the liabilities. 
T Kalaiselvan
Advocate, Vellore
14105 Answers
127 Consultations
5.0 on 5.0
The main thing is we are unable to contact my brother, neither on phone nor with any other sources.we don't know where he is.only he can confirm whether he had actually taken the amount or not.and if taken,then he only can confirm the exact amount taken.The lender has taken the documents from me but he didn't gave the amount in front of me, and neither my brother nor the lender confirmed me about the transaction.I got to know all this after my brother left.

You are not liable to account or vouch for your brother's personal loan or debt,  do not entertain any such demand, ask them to go o the court where yo can challenge their case.





And also let me know if I can request for stop payment for that particular cheque to bank (saying paid in cash).

You can give instructions to bank for stop payment.





And i have also heard that taking sign on blank stamp paper is illegal.

Yes, taking sign on blank stamp paper is illegal and not valid in the eyes of law. 


T Kalaiselvan
Advocate, Vellore
14105 Answers
127 Consultations
5.0 on 5.0

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