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.