1)under section 128 of indian contract act liability of principal debtor is co extensive with that of guarantor
2) the creditor has a right to obtain a decree against the surety and the principal debtor.
"The surety has no right to restrain execution of the decree against him until the creditor has exhausted his remedy against the principal debtor for the reason that it is the business of the surety/ guarantor to see whether the principal debtor has paid or not
3) since your uncle has absconded the lender can proceed against you to recover the chit fund amount taken by your uncle with interest
4)you can repay the loan amount and then proceed legally against your uncle
5) The surety after making the payment to the creditor will step into the
shoes of the creditor
6) surety has got a right to recover the
amount which he has paid to the creditor. It may include the principal amount, it
may include the interest and it may include the cost also